With AI mania driving heightened competition and elevating industry benchmarks, we are now faced with questions concerning the ad tech sector's trajectory. How can brands harness AI to enhance decision-making and deliver optimised experiences on a large scale?

Nothing has been quite as ubiquitous throughout digital marketing discourse within the last five years as AI and its vast potentials. It continues to permeate the digital marketing landscape, actively reshaping strategies and the way brands connect with their audiences, and is projected to be a $107.4bn (~£85.5bn) industry by 2028. 

As 2024 rolls around, the new dawn of digital marketing brings with it a new slew of industry concerns, including but not limited to the death of third-party cookies, growing ad fatigue, and the increased demand for privacy and data regulations. The advertising industry now finds itself at a crossroads, caught between the ever-expanding possibilities of AI-driven innovation and the increasing demand for ethical and sustainable advertising practices in an era of heightened consumer awareness. We take a look at how the ad tech industry can make AI work for them, through creative, data-driven, and sustainable pursuits.

AI-powered targeting: precision in advertising

Attending the needs of both creativity and efficiency, AI enables companies to do more with data, using it as a tool for driving content. Rather than replacing creative teams, which seems to be a real fear for some, it provides them with a powerful tool to guarantee that a wider range of content reaches its audience precisely when and where it's most effective.

Predictive modelling with AI is one way in particular that the ad tech industry can foresee consumer behaviours and trends, equipping advertisers to stay one step ahead of the competition using data-driven analysis. With the assistance of artificial intelligence, advertisers can swiftly analyse extensive datasets, gaining invaluable insights into emerging trends and prospective developments. These predictive insights empower those in ad tech to fine-tune delivery tactics, refine targeting efforts, and optimise messaging to enhance the overall effectiveness of  advertising campaigns. AI allows for vast swathes of data to be analysed and utilised - prior browsing activity but also every interaction a consumer has had with a brand, spanning websites, linear advertisements, emails, apps, and social posts - factoring in the user's complete journey for each impression delivered. This could have far-reaching implications for managing ad frequency and weaving sequential narratives across devices, platforms, and channels, a sort of curation for audiences within media consumption that allows to group certain behaviours. 

The future of AI applications can also be actualised within dynamic creative optimisation (DCO) – AI works best within somewhat structured environments, and this is the perfect opportunity for that. DCO solutions provide advertisers with comprehensive control over creative layouts, allowing them to fashion bespoke ad templates. Powered by predictive AI algorithms, these systems dynamically tailor the creatives in real-time, autonomously fine-tuning creative elements to enhance performance, and selecting key performance indicators (KPIs) based on business objectives.

Content curation with AI

As AI continues its evolution, so does its proficiency in content curation. With the advancements in natural language processing and machine learning capabilities, AI now possesses the capacity to delve deeper into content analysis, pinpointing key themes, gauging sentiment, and even detecting instances of fake news.

Moreover, AI excels at tailoring content curation to the unique interests and preferences of individual users. This implies that a single algorithm can furnish distinct content recommendations to two different users based on their prior interactions and behavior.

AI-driven content curation signifies the future of content discovery and sharing. Not only does it save time, but it also guarantees the utmost quality and relevance of content. By analysing user behavior, preferences, and historical data, AI can curate ads that are more likely to resonate with individual viewers, resulting in improved click-through rates and conversion rates. For consumers, this translates to a more personalised online experience, where they are exposed to advertisements that align with their interests and needs, reducing the irritation often associated with irrelevant ads. AI with curation in ad tech transforms digital advertising into a win-win situation, where advertisers achieve better ROI, and consumers receive a more tailored and enjoyable online experience.

Creative innovation: transforming ad content with AI

As ad fatigue remains a serious issue for the industry, the name of the advertising game becomes resonance and individualism, and where consumers go, digital advertising follows. In fact, a recent Adlucent survey found that 71% of respondents said they would prefer ads that are tailored to their personalised interests and shopping habits. Relevance is no longer just a nice addition, it's imperative for advertisers wanting to stay relevant, and if the name of the ad game is resonance, AI serves as a cheat code. The capabilities of AI empower brands to take into account the context surrounding digital content, moving beyond purely data and into behavioral targeting. This encompasses not only keywords but also factors like page types, phrases, and diverse media channels, along with a broad spectrum of other data that facilitates precise targeting of individuals based on their real-time interests. Genuine relevance thrives on comprehensive and precise data, surpassing mere demographics to provide understanding of a consumer's requirements, and this is exactly the benefit that AI offers.

Creative pursuits are also helped massively by AI within the clamoring ad marketplace of capturing attention, developing creative content development. Generative AI has the ability to modify the initial copy and subsequently evaluate these alterations to determine if they are better than the original version. This iterative procedure involves refining both the text and the images concurrently, with the guidance and supervision of a human analyst. AI is also employed to enhance the creative facets of advertising campaigns. Through the evaluation of various ad formats and creative components, AI algorithms can discern the elements that prove most adept at fostering engagement and driving conversions. This valuable insight can subsequently be applied to craft more potent ad campaigns, ones that are finely attuned to the preferences and interests of the target audience.

Cleaning up ad tech with AI

One of the biggest barriers in ad tech is waste - the lengthy supply chain that is involved in a single ad’s delivery to a publisher space shows that a programmatic ecosystem clean up is vital. AI can help in promoting sustainability within the advertising industry through countless ways, ranging from supply chain optimisation all the way to AI-driven insight into consumer behaviour, and optimising ad delivery time to reducing excessive ad impressions and energy consumption. Using AI, brands possess a significant opportunity to normalise sustainable choices by integrating them into advertising and content created by influencers. This can be accomplished by associating sustainability with tangible benefits like durability, cost-effectiveness, or even empowering consumers with knowledge as to how sustainability can positively impact their lives. One notable implementation can be seen with Garnier and Google teaming up to enhance sustainability messaging. They used ML-generated insights to craft a targeted media strategy for Veganuary in Germany, making vegan beauty their top category on a shopping platform. This boosted sales by 97%, promoting eco-friendly choices and supporting sustainable business shifts - a chance for marketers to drive green consumer habits. 

The bottom line

We are witnessing just the beginning of an era that holds tremendous promise for advertising, and with an increasingly convoluted ad tech ecosystem, the question isn't whether we can afford to embrace AI in ad tech; it's whether we can afford not to. As we witness the exponential growth of data and the complexity of consumer behaviour, AI emerges as a tool that not only optimises campaigns, but can help the industry make more relevant, ethical, and sustainable advertising choices in the future.