October 5, 2023

Unlocking the Potential: How AI Can Empower Ad Tech’s Next Era

By Heather Allerdice-Gerow

Sr. Director, Industry Leader for Media Portfolio

While AI awareness is reaching new peaks in the consumer space, those working in advertising technology have long been aware of the potential and power of AI and machine learning. The terms have been part of ad tech marketing for more than a decade now.

Still, the recent surge in AI capabilities can bring many new benefits to ad tech, much like it can for other parts of the media industry. Developments in AI and machine learning are bringing on a new era of ad tech, and it’s important that companies understand how to take advantage.

How AI can solve ad tech’s challenges

Like other kinds of media businesses, ad tech companies are battling to differentiate themselves amid a crowded and competitive market. Ad tech stands apart in that almost all of its products are business-to-business tools. In many ways, ad tech needs to think about how applying AI can help transform both their products and their customers’ businesses.

  • Ad Optimization: AI can sort through massive amounts of anonymous consumer behavior data to identify commonalities and build these into audience segments that are most likely to respond to certain brands, messages and offers. When ad tech can deliver this optimization with great speed and accuracy, it radically benefits the end results for the brands or agencies deploying the products.
  • Personalization: The promise of many digital advertising products is that they can align the right message with the right person at the right time. Personalization is key to success in modern advertising, and AI can fuel even greater improvements in dynamic creative optimization and message customization, so that every ad engages the consumer who sees it.
  • Cost Savings: All media companies are fighting for revenue, and ad tech in particular has felt the headwinds of economic uncertainty. Advances in AI means that ad tech tools may be able to rapidly lower their computational costs, as well as increase their speed and efficiency. Together, these cost differences can go towards areas like marketing, sales, engineering and data science – critical departments needed for research and development and revenue growth.

AI use case for broadcasters: Ad optimization

Advertising technology has long been at the edge of using new technology for targeting, delivering, and optimizing media. This is where AI has most commonly been used as a marketing term, promising platforms and tools that learn as they go, improving ad performance with each permutation and campaign flight.

While many ad tech tools have this capability, recent advancements in AI can help ad tech take several gigantic steps forward, rapidly expediting the process of segmenting, testing, optimizing, and reporting across campaigns.

Every incremental improvement here helps differentiate the ad tech product, but more than anything, it helps the end user in their business. The faster that an ad tech tool can process data and segment audiences, the faster a brand or agency can put that tool to use.

This is especially important as brands and ad agencies look to navigate the evolving media ecosystem themselves. AI can finally help ad tech make the connections around which channels drove outcomes over the course of a campaign, and then use that information to build out detailed multi-channel media plans that will deliver similar – if not better – results.

Put another way: brands need their ad dollars to be much more accountable. When ad tech tools leverage the full capabilities of AI and predictive intelligence, these tools can ensure that those ad budgets deliver measurable results. That results in revenue for the advertiser, and continued success for the ad tech company.

Where to start

Ad tech companies may think they already have the latest and greatest AI capabilities and that they don’t need to tune up their technology. No matter how cutting edge your solution, it makes sense to explore what’s new and emerging in the field of AI and examine how that might help with some of your core business problems. Faster computations, improved optimization capabilities and cost savings are all things most ad tech companies would greet with open arms. Here at 3Pillar we’re continuing to monitor the latest developments in AI and identify how ad tech and other media companies can apply AI to build breakthrough products that transform their business. To get started on a conversation about how AI can apply to your business, contact us.