A Crossroads: Artificial Intelligence And Advertising
According to Elon Musk, artificial intelligence (AI) is “our biggest existential threat.” Whether that is fact-based or hyperbole is determined by the reader’s perception of Musk as either the real-life Iron Man or a classic hype marketer. Whether Elon is trying to wake humanity before it’s too late or simply sell tickets on a Mars-bound Tesla is beside the point. The focus here should be that Elon Musk has discovered and successfully exploited the intersection of AI and advertising and so can you.
We have reached an inflection point in the advancements in, and democratization of, artificial intelligence. The technology allows businesses to harness its value daily to realize new business development opportunities and capitalize on tangible results -- chief among them is a more intelligent way to advertise products and services, verify campaign efficacy and measure return on investment. On top of this, and perhaps in direct contrast with Musk’s comments, legacy radio and television are poised to be the prime benefactors of this AI-driven advertising revolution.
For many years, digital advertising has been the safest and arguably most sound bet in advertising. Cookie tracking, intellectual property (IP) targeting and other technologies allow brands and agencies to gather user and audience data in order to target their advertising campaign placement, track overall efficacy and measure return on investment (ROI) down to the click. This level of ROI transparency is tough to argue with and ultimately led to digital ad spend reaching $209 billion worldwide, which accounted for 41% of the market in 2017. Digital finally eclipsed traditional TV spending, which brought in $178 billion, or 35% of the market. With no definitive way to target, track and measure advertising efficacy, radio and television have been struggling to compete with digital until now.
While digital advertising currently makes up the lion's share of brand and agency advertising spending, traditional radio and television companies are fighting back in a big way thanks to artificial intelligence. Developments in natural language processing, logo recognition, object detection and other AI technologies have enabled radio and television broadcasters to bring structure to a medium that has been heretofore impossible. With every word, logo, object and face indexed in near real-time, radio and television content becomes just as searchable, trackable and actionable as digital content. This is critical because without true structure -- a temporal record of exactly what aired -- agencies and brands had been struggling to successfully target, engage and unlock the value hidden within radio and TV. Now, with AI, legacy challenges have fast blossomed into new opportunities and there is plenty of nectar to go around.
Just take it from top media agency Carat’s chief compliance officer (CCO) Shannon Pruitt, who, in speaking to CNBC regarding product placement within traditional distribution windows, said, "Advances in audience targeting, the understanding of the role of product integration, as well as the focus on measurement capabilities to prove ROI, while still not comprehensive, has elevated the acceptance and pursuit of the opportunity to be part of the story."
In other words, the convergence of AI technology used for audience targeting and ROI evaluation with the shifting desires of TV and radio audiences away from traditional interruptive-based 30- and 60-second commercials, has agencies and advertisers alike rushing back to TV and radio to cash in on new in-content branding opportunities. According to PQ Media, the “value of U.S. product placements will reach $11.44 billion in 2019,” surging up from $6.01 billion in 2014. This type of growth for traditional mediums who had been left with mere scraps in recent years is one very concrete example of how AI, when leveraged appropriately, can revolutionize an industry overnight.
So whether you are looking to streamline operational efficiency, innovate products or unlock additional revenue streams, you might consider taking a page out of Elon’s book and look towards artificial intelligence.
Source: All the above opinions are personal perspective on the basis of information provided by Forbes and contributor Logan Ketchum.