As the Cannes Lions International Festival of Creativity (now in its 65thyear) kicks off today, bets are high that the realization that advertising is broken and humans alone can’t fix it will be top of mind among the nearly 20,000 marketers, advertisers and tech companies set to descend on the high-profile event.
Indeed, there is no overlooking the numbers that underline a dangerous disconnect in what brands want to say and what people want to hear. Millions of ads are ignored every hour by consumers, record numbers are using adblocking technology to cut out unwanted noise and evidence is mounting that people crave meaningful experiences, not marketing speak. However, the work required to deliver personalization at scale–sifting through billions of data points (trillions if you count the input from the sensor networks that make up the Internet of Things)—has moved beyond human capacity.
This hard truth is driving interest and investment in AI into the stratosphere. It’s also escalated the “AI arms race,” where companies are competing to elevate the customer experience based on their ability to make logical predictions about what a consumer is highly likely to do or want next. Against this backdrop, marketing, a data-driven activity where AI can provide the most immediate and recognizable return on investment, might end up looking like ground-zero.
“The impact of AI on business as a whole is poised to be more dramatic—and disruptive—than the Internet,” Stephen Upstone, CEO of LoopMe, tells me in an interview. LoopMe is a mobile video programmatic and advertising platform provider that uses AI to optimize brand outcomes.
Others warn the outcome could be seismic and irreversible. Malcolm Frank, executive vice president at IT and consulting company Cognizant and co-author of What To Do When Machines Do Everything: How to Get Ahead in a World of AI, Algorithms, BOTs and Big Data, believes marketing will never be the same again. As he puts it: “Five years from now marketing without artificial intelligence will be no marketing at all.”
Frank’s observation speaks volumes about how AI will transform marketing in the future. But it begs the question: where does AI make a profound difference right now?
In a word, everywhere.
“AI has a role to play at every step of the journey and every stage of the funnel,” says Celine Saturnino, Chief Commercial Officer at Total Media. The UK-based agency looks back on a 35-year history in digital marketing and envisions a future where AI and its ability to understand and predict audience behavior will play a pivotal role. It’s why the company also operates as “The Behavioural Planning Agency,” a title it has trademarked showing its commitment to evolving with the capabilities of AI and technology to drive better business benefit for clients through a deeper understanding of what motivates and activates audiences at scale, Saturnino explains.
In the pre-campaign stage, for example, AI powers content optimization to help make the match between what clients need to say and what consumers want to hear. “It’s about analyzing online conversations across the breadth of the web to understand the emotion of those conversations and determine the messaging that will resonate with those audiences,” Saturnino says. These insights naturally flow into the planning stage, where the focus is on activation.
It’s here, she says, that AI “connects the dots in Big Data” to understand how consumers think, feel and behave in order to identify patterns and trends and—more importantly– predict response rates to advertising that strikes a chord. “Effective advertising understands the customer, and this is where AI brings the biggest benefit and uplift.”
Mobile video moves the needle
Mobile video, which captures both the attention and emotion of consumers, stands out as an ad format where the uplift from AI is both impressive and immediate. Recent research from Google that shows how video is shaping how people shop further underlines how consumers are “drawn to the richness of video to help them experience a product in ways that words can’t convey.” Little wonder that both AI and video figure prominently in the list of where marketers plan to increase investment and efforts in 2018.
According to a recent survey of 425 global digital marketing professionals from mobile growth marketing platform provider YouAppi conducted by Dimensional Research, 85% of marketers plan to increase their investment in video this year, up 10% over 2017. Moreover, 36% of marketers say AI tops the list of technologies they plan to bring on board in 2018, compared to 23% in 2017. Machine Learning, a current application of AI, is also a top priority for 43% of marketers, up from 37% the previous year.
The ability of AI to “aggregate data at scale, identify prospects who are more likely to interact, and drive rapid optimization of campaigns” ensures mobile video attracts and engages the right audiences, Saturnino observes. While she believes AI can boost the effectiveness of all ad formats, including display and interstitials, the fit with video goes one better. It doesn’t just sharpen targeting to stop wastage. “It drives high-quality engagement with high-value audiences, not customers who are here today and gone tomorrow.” In many cases, she says, the outcome is a 20% uplift—and can be much more.
Just how much more becomes clear when we examine the findings of “Closing the Loop on Brand Advertising,” an April 2018 study from LoopMe. Based on data drawn from more than 150 campaigns run in more than 20 countries the report concludes that, on average, applying AI to “optimize toward brand outcomes like purchase intent, brand consideration, brand favorability or awareness in real-time drives a 6X increase in brand metrics.”
In this scenario, AI baked into the company’s PurchaseLoop solution, which was recently awarded ‘Best Video Marketing & Advertiser Platform’ at the Digiday Media Awards Europe, powers a predictive model to determine the likelihood of the user completing a desired outcome at a specific moment in time. Audiences identified by the AI as most likely to respond or convert are then served the ads. Marketing and messaging aside, the LoopMe study sheds important light on the how and why of AI and where it moves the needle.
LoopMe’s Upstone tells me AI optimization delivers the biggest boost the further along you are in the funnel. “The opportunity to create an uplift is much higher against an event that is less likely to happen or happens much less frequently,” he explains. In the case of purchase intent, a deep-funnel metric and goal, AI delivered a brand uplift of 51.3%, a whopping 19X more effective than traditional advertising optimization.
Knowing what flies—and fails
But brand uplift is just part of the picture. AI also serves as an early-warning system for advertising that misses the mark. “Marketers who harness AI are looking for incrementality and if metrics don’t add up, then it’s a sure sign there’s something fundamentally wrong with the customer experience.” The opposite, Upstone says, is also true. “If the metrics are positive, then it’s compelling evidence messaging, and targeting are perfectly aligned to your audience, and it’s all-systems-go to scale those results using AI.”
This is possible because AI is rapidly evolving to a stage where it can close the loop. While attribution and tracking get high ranks for providing marketers critical visibility into what people do after they see video ads, it’s AI that can wield this data to predict consumer behavior with a high degree of confidence. “This is linked to the unique ability of AI to understand and interact with individuals in a highly personal manner based on a deep knowledge and understanding of their unique attributes, not just the ones brands think they know based solely on demographics and surface data,” Upstone explains. From there marketers can wash, rinse and repeat results, relying on AI to optimize this process continually based on what it “knows” is working and what isn’t.
This is critical in an industry where an October 2017 study by Forrester Consulting, aptly titled The Machine On Your Team, reveals most marketers have yet to grasp AI and how to best leverage it in order to reach their KPIs. Ironically, the knowledge gap about the potential of AI doesn’t deter marketers from plowing money into AI-driven marketing strategies and solutions. The vast majority (78%) of marketing decision makers say they plan to adopt or expand AI marketing platform initiatives and 86% said they believe AI can add value to their business.
This dovetails with eye-opening data from GumGum, an AI company with deep expertise in computer vision. It surveyed advertising executives and marketers in June 2017 to gauge the level of interest and activity in AI and its many applications, which include machine learning, deep learning, natural language processing, computer vision, and bots. While 61% of marketers said they were “generally aware of AI and its potential,” only 3% considered themselves experts. Once again, the lack of AI understanding doesn’t inhibit investment. GumGum’s study found that over half of companies plan to deploy AI in the form of predictive analytics to “learn” from consumers to create more tailored experiences and advertising they can’t refuse.
Top 3 AI checklist
Marketers may invest in AI expecting to deliver personalization at scale, but it takes more than resources to drive results. Below is a checklist of 3 guidelines (based on interviews with brands, agencies, and companies driving advances in AI including LoopMe) marketers can follow to wring the most value out of their AI investments and efforts.
#1 Don’t just buy AI; interrogate it. AI is a hot topic, but marketers are buying into more than a headline. Before you take the plunge, do your homework to understand the AI technology solution you plan to implement. Vendors that work with third-parties to benchmark their effectiveness should be at the top of your list.
#2 Listen to what AI is telling you. AI is a silent partner in the creative process, helping marketers identify the marketing, messaging and creatives sure to resonate with consumers based on a deep understanding of their past behavior and preferences. Pay attention to the analytics and set constraints when you feel you must. But you may find that giving it a free reign to open the aperture of how you see and engage your audience may pay dividends. LoopMe’s Upstone recalls a client case study with a major handset maker sharply targeted on acquiring and engaging males that saw conversions rise through the roof when it allowed AI to suggest creatives catering to a female audience. “The client would have missed out on that opportunity entirely if it had failed to listen to what the data was telling it,” he says.
#3 Don’t let AI be a black box. AI is getting remarkably good at automating data analysis to help marketers predict customer behavior and prepare for positive brand outcomes. But that’s no reason for marketers to assume they won’t understand (or don’t need to understand) the calculations and connections that go into a decision. According to a Forrester Research report commissioned by AI startup Amplero, 44% of marketers do not trust AI platforms that lack transparency. The takeaway: humans must remain at the helm–and marketers must cultivate skills that will allow them to “collaborate” with AI to achieve the best results for their clients.
The more information AI receives, the better the outcome. However, AI does much more than cut through the murky sea of data to surface actionable insights, David Skerrett, an independent digital strategist working with brands, agencies and start-ups, tells me in an interview. AI has the power and potential to “unlock unlimited opportunity, making the invisible visible and the impossible possible.” The outcome is a “marketing and experience superpower” that combines the data intelligence of machines with the emotional intelligence of marketers, he says.
But first marketers must learn to embrace AI as a companion and co-worker, not a competitive threat. (Over 60% of senior executives from nearly 1,000 organizations already implementing AI surveyed in a June 2017 study by Capgemini reported the majority of employees are concerned about the impact of AI on job losses.) A positive and productive blueprint for how humans and machines should interact comes from Mickey McManus, a pioneer in the field of collaborative innovation, pervasive computing, human-centered design and education. “We need to explore the idea of humans and machines playing together like jazz improvisation,” McManus explains. In this scenario, humans bring the passion and AI brings the ability to predict, and the two collaborate and co-create to produce amazing outcomes and incredible value at the “human-machine intersection.” This is where the output of AI just keeps getting better and—even better—this is just the start.
This article first appeared on Forbes.