We explore a dozen AI tools driving hyper-personalization and productivity on top ad platforms of Google, Meta and Reddit.
Artificial intelligence is changing advertising as we know it today. From automating processes and driving hyper-personalization to aiding idea generation, Generative AI is poised to catalyze a new age of advertising capabilities.
Major advertising platforms are rapidly embracing AI.
Consider Google’s conversational experience, which can seamlessly deliver intricate campaigns, or Meta’s Advantage+ shopping campaign, which uses machine learning for enhanced productivity - these are just a glimpse into the myriad of AI-powered applications in advertising.
A recent McKinsey report estimates that Gen AI could contribute up to $4.4 trillion in annual global productivity, and an estimated 75% of that value will come from just four groups—marketing and sales being one of them.
Marketing leaders are cautiously optimistic about Gen AI use cases, anticipating moderate to significant impact:
Source: McKinsey & Company
As businesses strive to expand their e-commerce operations, every major advertising platform has scaled up its AI efforts to automate, sell, target, and place adverts that are optimized in real time.
AI is poised to touch every area, from producing first drafts of brand advertising, headlines, slogans, and social media posts to writing SEO-compliant product descriptions.
This blog will explore the current state of AI tools on major Ad platforms. We understand these tools will constantly evolve; hence, this blog will be regularly updated.
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Google’s history with AI dates back to 2001, when the search giant used machine learning to correct spellings in its search box. Since then, Google has contributed to every major AI breakthrough - from AlphaGo defeating the world champion to developing early transformer models (on which chatbots like ChatGPT are based) to solving protein folding problems in biology.
As a pioneer in integrating AI into its advertising platform, Google today offers a suite of tools. Here's a detailed look at the AI tools and features on the ad platform:
1. Gemini-Powered Conversational Experience
In December 2023, Google announced Gemini, its largest and most capable AI model, which now powers Google’s conversational experience. This new workflow is designed to help users build better search campaigns through a chat-based experience.
It combines the advertiser’s expertise with Google AI to optimize search campaigns by generating text and other assets automatically. For example, conversational experience workflow tools can:
- Create new search ad headlines and descriptions
- Generate relevant keywords
- Suggest images
- Suggest site links
Using only the URL of your preferred landing page, the tool can generate a short description of your business and suggest relevant and effective keywords, headlines, descriptions, images, and site links for your campaign. This helps reduce the marketing efforts.
2. AI-Driven Search Ads Products
What consumers want and how they search for it constantly changes, making it difficult for advertisers to anticipate every possible search relevant to their business. Google uses AI to set the right bids, reach the right searches, and create the most relevant ad for consumers.
Smart Bidding
Smart Bidding evaluates billions of combinations of signals and metrics to set the right bid for every search query and auction based on an advertiser’s ROI goals. Value-based bid strategies, like maximizing conversion value, help advertisers capture the customers that matter most (and generate the most monetary value) for their businesses and optimize ad spending.
Broad Match
Broad Match uses AI to extend its reach beyond exact and phrase match by identifying related queries to reach more customers and drive better performance. Working with Smart Bidding, Broad Match ensures advertisers only bid on searches expected to perform for them. It helps them stay on top of market trends and rapidly shifting demand by reaching all relevant searches for their business.
Responsive Search Ads
Responsive search ads let advertisers create ads that adapt to show more relevant messages to their customers. For example, they could enter multiple headlines and descriptions when creating a responsive search ad.
Over time, Google uses AI to test and learn which combinations perform best. Advertisers can use the feedback to refine headlines and descriptions so ads resonate better with customers.
3. Performance Max with Generative AI
Performance Max launched in 2021 as the first AI-powered campaign to work across all Google Ads inventory, including Search, YouTube, Display, Discover, Gmail, and Maps. In May 2023, the platform received Generative AI features.
Advertisers can use Performance Max tools to generate or suggest text, images, logos, and video assets. It addresses one of the hardest parts of building and optimizing a cross-channel campaign: creating and scaling assets.
Using Performance Max, existing assets can also be easily enhanced. For instance, teams can test new variations of their usual images at scale, access image editing tools through the Google Ads asset library, or include sharable previews.
4. AI-Powered YouTube Ads
YouTube’s AI-driven approaches help display ads in the most relevant context, delivering unparalleled engagement and results.
Spotlight Moments, for example, utilizes AI to identify the most popular YouTube videos around major cultural events like Halloween. Advertisers can then sponsor a branded YouTube channel to feature their ads alongside this automatically curated event-related content.
Trim video is another video ad production tool that helps create shorter variations of longer video assets in custom ad lengths, such as 6/10/15-second skippable or 15-second non-skippable ads.
Trim video uses AI to simplify this process by identifying the most important frames in a long ad and turning them into trimmed-down versions. It also has simple editing features that allow advertisers to modify the final output.
Reddit sits on over a decade of valuable user content data, which had been a free teaching aid for companies like Google, OpenAI, and Microsoft when training their AI models. In April 2023, the platform started charging heavily for its API calls, the firehose of data from its 100,000 communities.
In February 2023, Reddit agreed to a $60 million yearly deal with Google to provide access to that information. In exchange, Reddit also secured access to Google’s Vertex AI, which it intends to use to enhance search and other capabilities.
Reddit has since gone public and has recently rolled out Ad creation updates, including Generative AI tools that simplify ad campaign creation and tracking.
5. Smart Headlines
Smart Headlines is a Reddit tool powered by generative AI designed to streamline the ad creation process. Like Google’s Conversational Experience, by entering website URL, advertisers are presented with headline options crafted specifically for their target audience.
These suggestions consider the language, tone, and formats that have historically resonated with Reddit users, making it easier for advertisers to capture the attention of the target demographic. The approach saves time and gives advertisers valuable insights into what drives engagement.
The platform also uses AI and machine learning to ensure anything that violates policy gets taken down.
6. Creative Asset Cropper
This tool uses AI to crop images to fit Reddit's ad format and specifications. This helps advertisers save time and avoid the frustration of mismatched or improperly displayed ad creatives, enhancing the overall impact of their campaigns.
7. Streamlined Bidding and Budget Management
Reddit has also introduced AI-powered bidding and budget management tools. Among them is the lowest-cost automated bidding strategy, which aims to maximize campaign results within specified budgets by automatically adjusting ad costs.
This option simplifies budget allocation for advertisers, making it easier to achieve campaign objectives without overspending.
Reddit is enhancing its daily budget allocation process and updating bulk edit and duplication options. These changes offer advertisers greater flexibility and efficiency in managing their campaigns, allowing for quick adjustments and optimized performance.
Meta Platforms
Meta is no stranger to AI. In November 2023, the company celebrated the 10-year anniversary of its Fundamental AI Research (FAIR) team. Meta pours over $30 billion annually into AI research and has achieved significant breakthroughs in AI.
Many of Meta’s AI models drive the company’s algorithm-first advertising strategy known as Advantage+. Here's a quick look at some of the AI tools Meta offers for advertisers:
8. Background Generation
Background generation is a creative optimization feature that generates multiple backgrounds and templates to complement advertisers’ product images, allowing them to tailor creative assets for different audiences.
Source: Meta
9. Image and video optimization
Seamlessly adjusts creative assets to fit different aspect ratios across multiple surfaces, like Feed or Reels, allowing advertisers to spend less time and resources on repurposing creative assets.
This includes media enhancements, ad-level compositional changes, image brightness and contrast, music additions, and 3D animations. These creative optimizations improve ad performance while maintaining the campaign's core message.
10. Text variations
A content creation tool that generates multiple versions of ad copy using the advertiser’s original text. The tool uses AI to highlight product features and suggests text that could increase conversion rates.
Some use cases include suggesting pricing information that could trigger purchase, adding data to show business value, automatically incorporating a quote from a review or testimonial, and asking a question to capture the audience's attention.
11. Estimated Auction Rate
To ensure that the winning ad maximizes value for both customers and businesses, Meta decides ad auction winners based on the highest “total value.” A combination of three major factors determines this total value:
- Bid: What the advertiser is willing to pay to achieve the desired outcome
- Estimated action rates: The probability that showing an ad to a person leads to the desired outcome for the advertiser (using predictive analytics)
- Ad quality: measured using multiple sources, including feedback from people viewing or hiding the ad and assessments of low-quality attributes in the ad, such as withholding information, sensationalized language, and engagement bait.
Meta uses machine learning to inform this process, as shown:
Source: Meta
12. AI Sandbox
Meta provides early features through AI Sandbox that allow advertisers to access and test generative AI capabilities for its advertising system. The idea is to study what works for digital marketers and include these elements in its mainstream ad products.
Conclusion
AI-driven advertising tools allow personalized messaging at a scale unimaginable a few years ago. Almost every major platform now makes it possible to execute marketing strategies with precise segmentation and high-quality feedback. Future marketing campaigns will be highly targeted and data-driven and will take on an AI-first approach.