Generative AI is never far from the headlines or the conference hall. The technology has promised sweeping changes to the way advertising works. But now those promises are becoming reality–at least for Microsoft Advertising and its clients.
In the company’s guide to Chatbots and Agents, Microsoft Advertising said that generative AI was moving from “wow” to “now”. In essence, the initial wonderment of this promising innovation has shifted to become deployable, usable technology.
Nowhere was that more apparent than at Microsoft Advertising Accelerate, its recent flagship event for advertisers which saw the business launch a raft of new product innovations–including new consumer engagement opportunities and AI-powered solutions for advertisers–alongside case studies and proof points that AI is really changing the game.
“The ‘a-ha’ moment for clients was the evolution of Copilot,” said Nick Seckold, Microsoft Advertising’s APAC vice president.
“This is our second Accelerate event and while last year was largely about what’s coming, what would be possible with generative AI and how the landscape is changing, this year there were lots of examples of how things have changed and how Copilot and generative AI are working in the real world.”
But there was also a larger shift at play. Generative AI is not only changing the way media buyers book their ads and the way creatives craft those ads, but generative AI is also becoming an incredible advertising canvas because of its interactive and dynamic nature.
“The world we operate in is far more fragmented and increasingly complex. Consumers receive a lot of messages each day and it’s hard to navigate,” added Seckold.
Generative AI-powered conversational experiences, such as Microsoft’s Copilot, enable users to obtain answers more quickly and efficiently than before. It represents a shift from traditional search methods, where users input queries and are presented with multiple links, to a system that allows for more complex and detailed questions. Copilot processes and personalises its responses rapidly, significantly reducing the time needed to find the desired information.
It’s something that Mustafa Suleyman, EVP and CEO of Microsoft AI spoke about at length during Accelerate.
“It was fascinating. He’s thinking deeply about this space and is leading the charge globally” added Seckold.
Central to Suleyman’s vision is the rich, personalised experiences that generative AI can unlock for people. This translates into limitless opportunities for brands to transform how they engage with audiences.
“It’s the holy grail for advertisers,” Seckold said of Suleyman’s vision.
“If we can have a dialogue as opposed to a one-way conversation, it feels more natural–creating intuitive, seamless and personalised interactions. You’re not going to passively scroll any more. You’re not going to scour pages of results. You’re not going to get blasted with the same generic message as 10 million other people.”
For Nicole Prior, Microsoft Advertising’s APAC head of media and adtech solutions and chair of the IAB’s executive technology council, generative AI offers new speed of gathering, analysing and, ultimately, purchasing. It’s a true funnel flattener.
“To give you an example [from Accelerate], there was a family spread across different countries, but they were all meeting in Italy to go on holiday. Everyone had different views on where they wanted to go and what to see. Copilot was able to pool that information and create an itinerary based on different family members’ needs and wants, including hotel suggestions and restaurant recommendations. That would be hours of work and research but here the AI generated a tailored itinerary. Imagine pulling through sponsored opportunities designed for the AI experience that enable seamless booking of hotels and excursions in this very same Copilot conversation. This is powerful, and personalised,” she said.
New and Now
The key announcements from Accelerate included several new ad formats. First, Showroom ads. These aim to recreate the experience of visiting a brick-and-mortar store to learn everything about a product. For example, if a user asks questions to Copilot about a particular product, indicating purchase intent, they may be invited to enter a Showroom ads experience. Here, rich sponsored content complements the organic experience, helping to showcase the product benefits as people ask Copilot more questions.
Second, Dynamic filters give users the chance to quickly refine product searches with Copilot’s conversational experience. At times, people may see ads for a product they’re looking for, but they want to refine their search. This feature removes the friction of typing additional questions and quickly narrows down options that are more likely to drive conversions based on an individual’s preferences.
Renee Stopps, Microsoft Advertising’s APAC channel partner sales director, added that these new features could be transformational for small-to-medium-sized businesses.
“They enable SMBs to reach customers in a new way that they haven’t been able to do before because for them, it’s all about scale–how can they reach many more potential customers in the right mind frame at the right time,” she said.
Bringing Ads Studio to the Microsoft Advertising Platform will also be a significant boost to SMBs. Designed to create better-performing ads with ease, Ads Studio is an AI-powered creative tool built for performance marketers. With the increase in asset variety made possible by generative AI, Ads Studio helps to easily find, create, manage, and optimise creative assets with insights to boost advertising results.
“SMBs are very short on time,” added Stopps.
“They don’t have the people power and resources of larger enterprises. Having a product like Ads Studio integrated into platforms they’re already using will save a lot of time. It’s also going to give them a first step into the creative world as they’ll be able to build assets through search, video and display. We’re bringing this capability into our advertising platform with plans to expand into other solutions like our DSP.”
“AI has the ability to revolutionise the advertising industry,” added Stopps.
“It’s changing personalisation, deepening connections between brands and customers. Which is why we are developing AI-powered tools to enhance customer engagement. Plus, these experiences aren’t only available in a single platform. Copilot is in everything from Outlook to Edge and will continue to be rolled out across other platforms such as Xbox and MSN. It’s embedded into every product we have.”
Gaming and Beyond
It wasn’t only generative AI firing synapses at Accelerate. Microsoft also announced App campaigns across its King and Microsoft Casual Games products via the Microsoft Advertising Platform. Brands now have the ability to promote apps on games such as Candy Crush across Android, iOS and Windows. App campaigns are also coming to the Windows start menu–used by more than a billion people worldwide, and the Microsoft Store.
“Gaming is an incredibly powerful medium for brands,” said Prior.
“There are approximately 3.4 billion players globally, spending on average 12 hours plus per week. Gamers are highly engaged, and they play across console, PC and mobile. It’s an incredibly diverse audience.”
Microsoft’s gaming offering is compelling because it’s rare that marketers get a chance to reach multi-platform, engaged consumers in premium environments.
“It’s a great opportunity because you can be personalised, relevant and immersed in the gaming experience. What’s really exciting is that gaming can talk to both top and bottom funnel elements with interesting and creative ad formats, rewarded video and immersive playable experiences,” she said.
While Microsoft’s gaming exploits may seem tangential to its work in generative AI, they’re birds of a feather. Audiences are no longer passively consuming media or skimming over reams of blue links in a search engine. Brands and consumers can have two-way conversations with high engagement and personalisation.
All of this is underpinned by Microsoft Advertising’s vast audience data. The business reaches more than a billion people around the world as they search, browse, connect, play and shop. As Stopps said there’s a vast amount of proprietary, privacy-compliant data on offer. But rather than hindering marketers’ ability to see the wood for the trees, the reams of audience data is helping to truly personalise communications with audiences, again with the help of AI.
“AI is able to analyse data at scale in ways that we haven’t been able to before. With that analysis, we can leverage various products or tools to display the data. For marketers, bringing it all together gives us the ability to both educate audiences and promote brands within a privacy-compliant environment,” said Stopps.
A New World, Now?
It can be hard to cut through the noise when it comes to generative AI. From vocal detractors to even more vocal enthusiasts, few technologies have created such buzz around their capabilities–whether real or not.
However, Microsoft has been rather quietly building out an enviable slate of tools and features that actually move the needle for marketers. And they’re here. Showroom ads, for instance, started testing in April. Dynamic filters started their pilot testing in March.
Together, these new tools, along with brand agents (coming soon) and two-way search have the potential to fundamentally reshape the marketing funnel.
“I don’t think the role of top-of-funnel or bottom-of-funnel is changing,” said Prior, “I think it’s an integration of the two.”
Now, consumers can go from awareness to consideration to action in minutes, not hours; days, not weeks; and weeks, not months–depending, of course, on the category.
As Microsoft Advertising demonstrated at Accelerate, generative AI is here, now. Don’t get left behind.
Discover how Microsoft Advertising is transforming the future of audience engagement.
