How the generative A.I. boom could forever change online advertising

Shortly after ChatGPT went public last year, it immediately made headlines for its ability to answer user queries with a human touch, says the digital marketing veteran. Sean Lasnak start trying.

As someone who has made a career creating online ad campaigns for clients, Rasnak has seen how generative artificial intelligence can change his industry.does it make headlines Facebook Jobs that used to take 30 minutes to an hour can now be done in 15 minutes, Rasnak said.

And that’s just the beginning.

Rasnak also experimented with generative artificial intelligence tools such as halfway, which turns text-based prompts into images, as he tries to come up with compelling visuals to go with his Facebook ads. Rasnak says the software is especially handy for those without a graphic design background, and works with Canva and Adobe’s Photoshop.

While all this is still brand new, Lasnak said generative AI is “like the advent of social media” in terms of its impact on the digital advertising industry. Facebook and Twitter enabled advertisers to target consumers based on their likes, friends and interests, and generative artificial intelligence now enables them to create customized messaging and visuals as they build and refine ad campaigns.

“It completely changes everything in terms of how we market our titles, the volume, quality and quantity they’re able to put out, and the level of personalization that you get from that,” Lasnak said.

Rasnak isn’t the only one on the hype train.

Yuan, letter and amazonLeaders in online advertising are betting that generative artificial intelligence will eventually be at the heart of their businesses.They have all recently launched a product or announced plan Various tools are developed to help companies more easily create messages, images and even videos for their respective platforms.

Their products are mostly still experimental and, in some cases, have been criticized for rushing to market, but advertising experts told CNBC that, taken as a whole, generative AI represents the next logical step in targeted online advertising A step of.

“This is going to have a huge impact on digital advertising,” said Cristina Lawrence, executive vice president of consumer and content experience at Razorfish, the ad giant’s digital marketing agency. Publicis Groupe.

In May, Meta announced the AI ​​Sandbox testing suite, making it easier for companies to use generative AI software to create background images and try out different ad copy. The company also rolled out an update to its Meta Advantage service, which uses machine learning to improve the effectiveness of ads running on its various social apps.

Meta has been touting the Advantage suite as a way for companies to perform better after their marketing campaigns. apple The 2021 iOS privacy update limited their ability to track users over the internet.

Meta’s Advantage service has been popular with retailers using its automated shopping ads, according to data the online marketing company shared with CNBC. City.

About 2,100 companies spent $47 million on Advantage+ in May 2023, or about 27.5% of their total monthly dollar ad budget, according to Varos. A month earlier, those companies had spent 26.6 percent of their budgets, or $44.9 million, on Advantage+.

Last August, when Meta was officially launched Debut With its Advantage+ Automated Shopping ads, the company dedicates less than 1% of its meta-ad spend to the product.

Varos Chief Executive Officer Yarden Shaked said the increase showed Facebook had some success in convincing advertisers to rely on its automated ad technology. Shaked, however, said he “hasn’t seen the creative work yet” on Meta’s fledgling attempt to provide advertisers with generative artificial intelligence tools.

Likewise, Rasnak said Midjourney’s tools are “not yet sophisticated” at generating realistic imagery that could be incorporated into online ads, but are effective at generating “cartoon designs” that resonate with some smaller customers.

Jay PattisolAccording to Forrester analysts, there are several major obstacles preventing generative AI from having a significant and immediate impact on the online advertising industry.

One is brand safety. Companies are reluctant to outsource activities to generative AI, which can generate visuals and phrases that reflect certain biases or are offensive and inaccurate.

Earlier this year, Bloomberg News set up Images created by the AI ​​through the popular Stable Diffusion tool produce visuals that reflect many stereotypes, generating images of darker-skinned people when fed prompts such as “fast food worker” or “social worker,” and Link lighter skin tones with high paying jobs.

There are also potential legal issues when using generative AI powered by models trained on data “scraped from the internet,” Pattisal said. Reddit, Twitter and Stack Overflow say they will charge artificial intelligence companies to use vast amounts of data on their platforms.

Longtime marketing author and consultant Scott McKelvey cites other limitations related to output quality. McKelvey said that based on limited experience with ChatGPT, the artificial intelligence chatbot created by OpenAI, the technology has not been able to generate long-form content that companies can use as promotional copy.

“It can extract fairly generic content from the information that’s already there,” McKelvey said. “But no unique voice or point of view, and while some tools claim to be able to learn your brand voice based on your cues and input, I haven’t seen that yet.”

An OpenAI spokesman declined to comment.

A spokesperson for Meta said in an email that the company has conducted extensive research to try to reduce bias in its AI systems. Additionally, the company said it has brand safety tools designed to give advertisers more control over where their ads appear online, and will remove any AI-generated content that violates its rules.

“We are actively monitoring any new trends in AI-generated content,” the email said. “If the substance of the content, regardless of the mechanism by which it was created, violates our Community Standards or Advertising Standards, we will remove that content. We Our public-facing policy is being reviewed to ensure that standard is clear.”

A Meta spokesperson added that as new chatbots and other automation tools enter the market, “the industry will need to find ways to address the new challenges of deploying AI responsibly in production” and that “Meta intends to maintain at the forefront.”

Stacy Reed is an online advertising and Facebook advertising consultant currently incorporating generative artificial intelligence into her daily work. She’s using the software to create variations of Facebook ad headlines and short copy, saying it’s helpful in a world where tracking users online has become more difficult.

Reed described generative AI as a good “starting point,” but said companies and marketers still need to hone their brand messaging strategies instead of relying on generic content. She explained that generative AI doesn’t “think” like human strategists when generating content, but often relies on a series of prompts to refine the text.

Therefore, companies should not simply rely on technology to think big picture, understand which themes resonate with different audiences, or how to execute major campaigns across multiple platforms.

“I’m working with big brands that are struggling because they’re so disconnected from their average customer that they don’t speak their language anymore,” Reid said.

For now, major advertising agencies and large corporations are mainly using generative AI for pilot projects while they wait for the technology to develop, industry experts say.

Earlier this year, Mint Mobile Ad aired Actor and co-founder Ryan Reynolds reads a script he says was generated from ChatGPT. He asked the show to use his voice to write commercials, and used a joke, a swear word, to let viewers know the promotion was still going on.

After reading the text created by the AI, Reynolds said: “It’s kind of scary, but it’s compelling.”

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