How AI will transform the advertising industry

How AI will transform the advertising industry

The advertising industry is only just beginning to glimpse the impact of artificial intelligence (AI), according to Kate Scott-Dawkins, global director, business intelligence of GroupM.

The Next 10: Artificial Intelligence, a report written by Scott-Hawkins and other contributors across GroupM, forecasts the size of AI in advertising and reports on the technologies and behaviours that will shape advertising over the next decade.

GroupM estimates AI will reach more than $US370 billion this year, or roughly 45%of all advertising, and is likely to inform the vast majority of media by 2032, reaching $US1.3 trillion, or more than 90% of total ad revenue.

Scott-Dawkins » “While an exercise of this kind is speculative by nature, this report is rooted in the insights of the GroupM analysts, strategists and technologists who necessarily incorporate a long-term view when shaping the next era of media where advertising works better for people.

“It produces estimates around the size of AI-enabled ad revenue globally through the lens of how media channels are likely to evolve over the next decade due to the growth in application of AI, along with emerging technologies like edge computing and augmented reality.

“For the purposes of this paper, we define AI-enabled advertising as any artificial intelligence used in the process of advertising, from insight generation to activation and optimisation.

“We include technology and algorithms that sit under the umbrella of AI, such as machine learning, neural networks, computer vision, natural language processing (NLP), and intelligent process automation.”

groupm AI

Technology and behaviours shaping the next decade of advertising::

  • Declining reach of linear TV and less tolerance of irrelevant, interruptive ad pods.
  • Growth of audio-first devices with digital assistants (e.g. ear buds and smart home speakers) means that voice search will overtake text-based search.
  • Data will most often be managed on-device and will be increasingly obfuscated or anonymised by AI and privacy services.

Scott-Dawkins: “One of the most important implications of the growing use of AI is that marketers looking to capitalise on its capacity to drive personalisation will increasingly tie products, consumer experiences, and advertising closer together.

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