Artificial Intelligence is a hot topic right now – in advertising of course, but in a much broader sense too. The applications, benefits and potential dangers are being widely debated across society. Many believe this is going to transform how we live, from medicine to the military. However, there are concerns that without the proper regulations from government, this has the potential to be misused.
Probably the most high-profile example of misuse within the advertising industry was Cambridge Analytica. They were found to have influenced important political elections both in the US and the Brexit referendum in the UK, using social media to harvest personal data without proper consent, and to target the dissemination of misleading stories about political opponents. With clear examples of the damage it can do, it’s important that we have the right regulations in place to ensure that this powerful technology is properly controlled.
But let’s look at the benefits of such technology within the programmatic space. We recently started to test AI with Scibids, a next generation technology company. Their first-party AI algorithm makes 10,000’s of decisions per day, identifying users who are likely to be in-market for a given product and finding them at the most competitive price. The great thing about AI algorithms, unlike many out-of-the-box solutions offered by standard DSP’s, is that you can set multiple goals for them. This means that instead of just one targeting option and one KPI we can have several, and the algorithm will find multiple audiences who can drive performance against different KPI’s. We’ve been testing this for a few weeks now and already we’re beginning to see the benefits of applying this type of technology to our programmatic campaigns. With an uplift in performance in some campaigns of 40%, initial results are encouraging.
The increased use of AI across programmatic has led to the obvious question; is the role of the trader going to become obsolete? The answer I think, at least in the short term, is no. The success or failure of these tools depends very much on the ability of traders to set the correct campaign structure up in the first place. The real advantage that AI tools have over traders is the ability to analyse 10,000’s of bits of data – from day part, creative size, audience, site category etc – and do that 100,000’s of times a day. However, if the initial campaign set-up is not correct then it doesn’t have the levers it needs to pull in order to deliver incremental gains. This is where the expertise of traders comes to the fore.
The rise of AI in programmatic offers many benefits. Sure, it’s going to change the way that agency traders spend their time – more strategy, less optimisation – but that outcome offers many benefits for advertisers.