Artificial intelligence is used across many industries to optimize operations and improve effectiveness. In addition, due to the digital advertising space’s ability to integrate technology easily, we have seen an exponential increase in the use of AI in the advertising sector. With 77% of companies either using it or exploring its capabilities, AI and advertising are now inseparable! While many have found it effective in optimizing campaign performance and enhancing user engagement, there’s simply no doubt that AI in advertising means better returns on marketing investment. But, how does one use it successfully? In this article, we will provide our insights into the successful implementation of AI and explore its many possibilities.

What Is AI in Advertising?

Britannica defines artificial intelligence as the ability of a digital entity to perform tasks that we previously thought only humans could perform. And with how quickly this tech is developing, we may witness the capabilities of AI in advertising expand even more! Today, advertisers are using artificial intelligence for various aspects of digital marketing, including:

  • Targeted advertising;
  • Copy optimization;
  • Content personalization;
  • Customer experience enhancement;
  • Strategy refinement.

With the constant evolution of advertising AI technologies, the role of a marketer in advertising could permanently change, making understanding AI a necessity within the industry.

Why Do You Need AI in Advertising?

Advertisers have been able to survive in the marketing industry for many, many years without artificial intelligence. So, you’re probably wondering, do we really need AI in advertising? The answer is a resounding yes! To be clear, advertisers can still create advertising campaigns without the help of artificial intelligence; however, removing AI from advertising is akin to taking our laptops away from us as we write this article. We could still use pen and paper, but it would just be way harder!

AI in Advertising Helps You Do More

Do you know how they say that two heads are better than one? They probably say the same thing about brawn! It’s easier to get something done when you have multiple people helping out. Even if you’re flying solo, having AI in advertising is like having an entire team at your disposal. One of our favorite things about artificial intelligence is how it automates processes, which helps us in more ways than one:

  • finishing tasks more quickly;
  • eliminating the chance of human error.

So, if you’re pressed for time and want to get things done without sacrificing the quality of work, artificial intelligence is the way to go!

AI in Advertising Helps Improve Your Campaigns

Artificial intelligence has come a long way from just task automation. Nowadays, you can also expect AI to give you valuable insights into your campaigns. This is especially important if you want to set up a campaign on your own. With AI, you’ll be able to get great ideas even without someone lending a second pair of eyes. Humans are naturally bound to their biases, which prevent them from seeing certain perspectives. AI can help illuminate those blind spots. That way, you can consider all angles for improvement.

AI in Advertising Can Improve KPI Tracking and Measurement

Insights are only as good as the data they’re derived from. Therefore, if you have formulated an insight based on erroneous data, the insight itself will be erroneous. Having AI in advertising means higher data accuracy. As we have said, AI is not prone to human errors. This makes it a great tool to use for measuring and monitoring the success indicators of your campaign. With enhanced dashboards that you can receive thanks to AI in advertising, you’ll be able to accurately track what elements led to the success — or failure — of an ad.

Artificial Intelligence Can Boost Your ROI

Have you considered whether you’re allocating your ad budget in the best way possible? AI technology can help you identify platforms and channels that can yield the best returns, which is especially important if you’re on a limited budget. Because don’t you want to distribute your funds where they’ll have the greatest impact? Some AI tools can even provide suggestions on ad placement, allowing you to get more impressions and engagement.

Everybody Else Is Doing It

AI-powered advertising for advertisers is a must if you don’t want to lose leads and sales. As we mentioned, 77% of companies are doing something that’s related to AI. Do you really want to be the only one using your fists in a sword fight? Previously, using AI in advertising gave industry professionals a huge advantage. But today, it’s a necessity to simply level the playing field. Considering the competition out there, you want to be armed with every weapon possible. AI is one of the weapons that you don’t want to keep locked up.

How Is Artificial Intelligence Used in Marketing and Advertising?

We hope that, by this point, you’re convinced of the power of artificial intelligence in advertising. The next step is to know how to use it. In the previous section, we touched on what AI in advertising can deliver. Now, let’s get into the specifics. In the following subsections, we will talk about how you can use AI in various aspects of marketing and advertising, ensuring you’re maximizing the potential of AI in advertising campaigns.

AI-Driven Targeting and Personalization

Targeting and personalization are both crucial in digital marketing. They ensure that:

  • Your ads are being seen by your intended audience;
  • Your ads can resonate with the viewer.

In essence, targeting and personalization improve the odds of getting a response. Therefore, using AI in advertising can mean streamlining your ad campaign budget. In the end, isn’t the goal always to get more for less? Even before artificial intelligence, we made great leaps in terms of laser targeting the audience to deliver personalized ads. But, thanks to AI in advertising, we’re able to get even better results!

How Does AI in Marketing Improve Targeting Accuracy?

It’s not a secret that artificial intelligence can work at a pace and accuracy unmatched by humans. Using AI in advertising has allowed marketers to process more data compared to traditional methods. In addition, it can use real-time data to take the latest changes and responses from the audience into account. But this is not the only reason AI in advertising works so well. Thanks to machine learning algorithms, AI can use all this information to improve targeting based on more accurate predictions of user preferences and behavior.

Personalization of Ads Using AI Programmatic Advertising

Artificial intelligence can take things further through programmatic advertising. With this capability, AI can analyze data from users and present the most relevant advertisements, and as cookieless tracking slowly becomes the norm, AI in advertising will become even more valuable. This is because instead of cookies following every user around the web, advertisers can use AI native ads. This allows them to attain a high level of ad personalization while still respecting the privacy of their audience. All you’ll have to do is create multiple ads that are relevant to various segments of your target market and AI will do the rest!

AI-Powered Ads for Content Creation and Optimization

Another area where AI in advertising can help is in content creation. Even in the most rigid and formal of industries, a certain level of creativity is still required for ad creation. Meanwhile, those who consider themselves to be ad-creating virtuosos can still benefit from AI in advertising, using it to ensure that they’re only publishing the most optimized versions of their work. We’ll go into the hows in the following subsections. There, you’ll see that AI in advertising can be useful in multiple aspects of content creation.

Dynamic Creative Optimization (DCO) in Native Ads

AI images took the internet by storm in 2023 creating some of the year’s most viral content, but did you know you can use the same principles with AI in advertising? At MGID, we have a free AI image creation feature that lets you bring concepts to life using text prompts. Consequently, AI-generated images have even been found to be more effective than stock images, with an average clickthrough rate of 20% higher. In addition, through dynamic creative optimization, AI uses real-time data to create various iterations of the ad using the same base elements. This way, the creative is always tailored to generate the best user experience, considering the context, placement and past performance.

AI in Advertising Design Creation: Boosting Creativity and Efficiency

From our discussion in the previous section, you know that it’s possible to create images using AI. However, the choice of whether or not to use the image in your campaign is still up to you. In fact, instead of taking the images generated as is, you can take inspiration only from the elements that you believe will work best for your campaign. Thus, AI in advertising speeds up the creative process, allowing you to create graphical inspirations that fit exactly what you’re looking for. For all these things, you can use the MGID generative AI feature, which is completely free.

AI for Advertising Campaign Management and Analytics

As mentioned, employing AI means gaining the capability to handle large amounts of data. This makes it a great tool for data analysis. From the analyzed data, AI can generate insights that will help you improve your campaign. This is crucial to AI’s effectiveness as a one-person (term used loosely) team. Combined with its power to improve personalization and predict content, AI has all the skills required to run the show, even without your help. For you, this means limiting the time and resources needed to generate income from advertising.

Digital Advertising Intelligence for Monitoring Competitors

Competitor analysis is a crucial part of marketing. After all, competitors can be a source of valuable insights that you can apply to your own campaigns. Digital ad intelligence makes this easier than ever. Among other things, it lets you evaluate what is already working for your competitors, thus helping you improve your campaign. Digital ad intelligence can track many things, such as:

  • Best-performing ad content;
  • Key performance indicators;
  • Ad spend.

What does this mean for you? If you’re a new marketer, ads intelligence marketing using AI can help you get off on the right foot. Like the data from your target audience, you can also monitor these analytics as part of your campaign to get more sales.

Best of Artificial Intelligence in Advertising Examples

The use of AI can just be in the background (data analysis and targeting) or right in front of the target audience (content generation). Here are our favorite AI in advertising examples that incorporate AI in various aspects of advertising:

  • Copywriting Approach of Chase Bank: Chase displayed more humanized versions of their copy that resonated better with their customers, thanks to AI in advertising.
  • Predictive Analysis by Starbucks: Starbucks increased their organic revenue by 21% using AI to create a personalized experience.
  • Trend Identification by Ben & Jerry’s: Using AI in advertising, Ben & Jerry’s discovered the link between breakfast and ice cream and created breakfast flavors.

Challenges and Ethical Considerations of Using Artificial Intelligence Ads in the Media Industry

How much should we delegate to AI? How do we ensure that AI is learning from high-quality data? These two issues may be the greatest challenges AI in advertising faces today. And, of course, there will always be privacy concerns. If we continue our reliance on AI in advertising to process big data, it may gain insights that invade user privacy, even when using ethically sourced data. Ethics is one thing that we can’t outsource to AI. To responsibly use AI in advertising, it’s important to incorporate human oversight. This helps ensure that companies protect user privacy even as we move towards AI adoption.

What Is the Future of AI-Native Advertisements?

With various countries setting very strict rules to protect internet users from invasive practices, native advertising has become more important than ever. We’re sure that when advertisers went on to advertise the Sprint AI commercial in the 2018 Super Bowl, you were amazed and entertained. The use of AI in native advertising may not be as amusing, but it’s definitely going to have a huge impact on your bottom line. AI in advertising is expected to overhaul how things are done in digital marketing while still adapting to the ever-changing regulations surrounding online ads.

The Biggest Emerging AI Tech and the Impact of AI in Advertising

Beyond the expected changes in other forms of marketing, there is a specific technology that will apply to native ads. The future of advertising will breathe life back into contextual promotion. Here, AI in advertising relies on the context and content of the web page where the ad is placed. This way, the ad is still highly relevant to the browsing intent of the user. So, even if cookies become banned everywhere, using AI in advertising will still yield positive results without using invasive data-gathering practices. This will give advertisers a workaround for the absence of personal data that they once obtained using cookies.

FAQs About AI in Advertising

How does machine learning contribute to more effective ad targeting?

Machine learning algorithms can use past and real-time data to adjust targeting techniques. With AI in advertising, current user preferences and responses will be accounted for. This means that over time, the ads in your campaign will become more effective in eliciting responses from various segments of your audience.

What is the role of AI in advertising, and how has it evolved over the years?

Artificial intelligence can take on many roles and tasks for advertising. These include:

  • Generating ad creatives for advertisers;
  • Improving targeting and personalization of ads;
  • Helping to manage a campaign through ads intelligence;
  • Gathering valuable insights based on real-time data;
  • Shortening or eliminating the decision-making time for a campaign;
  • Monitoring competitors in the industry through digital advertising intelligence.

From simply automating tasks, AI now takes a more important role. Beyond mere task automation, it can handle complicated tasks that were once fell in the exclusive domain of a human advertiser.

What are the key benefits of leveraging natural language processing (NLP) in artificial intelligence ad campaigns?

With natural language processing, computers can communicate with users in the same language. For your AI ad campaign, this means getting the following benefits:

  • Deeper insights into the target market and their behavior;
  • Streamlined campaign operations;
  • Improved ROI from the ad budget.

Can you share examples of the best AI-targeted advertising campaigns that have been successful?

There are many campaigns that heavily use AI in various aspects of the ad campaign. These are just three of our favorite uses of AI in advertising.

  • Split testing by euroflorist: Euroflorist used AI to test thousands of ad variations and found the best combination, which boosted conversion rates by 4.3%.
  • Personalized emails by image business development: Using AI in advertising, Image Business Development personalized the content of each email as well as the time it was delivered to each subscriber, which increased conversion rates by 100%.
  • AI-generated images by Heinz: Heinz used AI in advertising to bank on people’s amusement at AI images, specifically on what AI thinks ketchup looks like.

How does AI enhance the personalization of advertising content for different audiences?

AI in advertising has improved personalization through:

  • Analyzing data and creating insights;
  • Making predictions based on past data;
  • Customizing ad content for individual users;
  • Tracking how close a customer is to a sale;
  • Continuous multivariate testing;
  • Personalizing ad delivery time.

What ethical considerations should advertisers keep in mind when using AI for ads?

The biggest concerns when using AI in the advertising industry include:

  • Intellectual property: This primarily concerns AI-generated images, as there’s a question of fairness because AI may be basing its output on human-created art.
  • Transparency: AI in advertising (and in practically every other industry) is a black box, which can be concerning since it’s relied upon to handle large amounts of data.
  • Data privacy: Artificial intelligence may be able to infer various information about people from seemingly harmless data fed into it.

To responsibly use AI in advertising, we should incorporate human oversight. This helps ensure that companies are protecting user privacy even as we move towards AI adoption.

What is the future outlook for AI in advertising, and what trends can we expect to see?

As far as advertising is concerned, the future is now! We expect more marketers to adopt AI into their processes. The trend for AI in advertising will always be toward personalization of content. After all, the more personalized the content is, the more effective it becomes.

Adapt and Evolve with AI in Advertising

Artificial intelligence is still a new terrain for many people, not just marketers. One thing’s for sure: it can potentially change the face of digital advertising as we know it. Therefore, we should approach artificial intelligence advertising the same way that we do any new thing: with exploration!

Native advertisers can benefit greatly from this emerging technology. If you need help maximizing the impact of a native artificial intelligence advertisement, register on the MGID platform. We have all the tools you need to make your AI campaign a success! With your assigned personal manager and our team of creative specialists, making an artificial intelligence advertising campaign will be a breeze.