AI took the spotlight last year, thanks to the hype around generative AI. While the rise of ChatGPT demonstrated remarkable progress in AI accessibility, the use of AI in the digital advertising tech sector isn’t new.
AI has been operating in the background for years where digital advertising is concerned. As the world becomes increasingly data-driven, harnessing AI in new and innovative ways has emerged as a game changer for advertisers.
However, it’s important to emphasise that relying entirely on AI to run our campaigns isn’t the best approach. Human involvement is key in advertising. So, the relationship between humans and AI will be a collaborative partnership akin to a pilot (human) and co-pilot (AI).
But how does that work in practice?
An analytical force
One of the primary strengths of AI in ad tech has proven to be its analytical capabilities. Where front-end generative AI has its limitations in advertising, back-end applications excel at processing and making sense of complex data sets. AI has taken the guesswork out of finding the right audiences, saving advertisers time and effort by extracting insights from vast datasets comprising demographic data, purchase history, and customer behaviour.
Today, AI helps advertisers extract valuable insights and understand behaviour more granularly by identifying patterns and trends to inform and fine-tune targeting strategies. For example, those using The Trade Desk tap into AI-driven insights off the back of 1 trillion ad opportunities per day, which is roughly 13 million ad opportunities every second.
As a result, advertisers can go beyond basic segmentation and create campaigns with greater precision for their strategies. By understanding the specific preferences and interests of individual consumers, advertisers can deliver more personalised messages that resonate on a deeper level. This level of precision and personalisation boosts engagement, increases conversion rates, and enhances the overall consumer experience — delivering stronger business-level results for the advertiser.
Yumi’s — an Australian consumer packaged goods brand known for healthy snack dips — recently combined human intelligence with the power of AI on The Trade Desk’s platform to optimise the cost-per-acquisition (CPA) for its campaign promoting its latest products. As the campaign progressed, Yumi’s ultimately saved 6% of the total budget thanks to AI analysing vast data pool of historical clearing prices and choosing the optimal bid for each impression. With this insight, the campaign team were able to identify the best channels and reinvest back into the campaign.
Embracing the real-time revolution
Real-time campaign optimisation is another example of humans and AI in action. Traditionally, advertisers have relied on post-campaign analysis to evaluate success. AI revolutionised this process by offering real-time campaign insights so marketers can monitor and optimise their campaigns on the fly. Thanks to these valuable insights, advertisers can swiftly adjust targeting parameters, creative elements, and media placements based on AI-driven recommendations, ensuring their ads consistently reach the right audience with the highest impact.
Automotive manufacturer Volvo recently showed the world how this is all done. The brand was looking to raise brand awareness of its modern, sustainability-focused brand in New Zealand with an emphasis on making the world a better place. Volvo leveraged The Trade Desk’s AI-powered platform to funnel investment and prioritise spend on audience segments that were better performing. This led to more precise targeting, enabling Volvo to expand their reach and deliver over 3 million impressions, while improving overall spend efficiency.
The potent collaboration
In the last decade, AI has demonstrated that humans and machines complement the strengths of each other and never has this use case been more apparent than in advertising. With AI streamlining processes and providing data-driven recommendations, humans can focus on more strategic responsibilities such as leading the strategy and navigating the complex advertising landscape.
While front-end generative AI continues to make headlines, it is the collaborative efforts of ad-tech platforms, marketers, and AI, that are redefining the boundaries of what is possible.
