How AI is Redefining Paid Media:  Key Benefits and Strategies for Success

Imagine being years ahead of your competition, reaping the benefits of sophisticated marketing strategies that deliver unparalleled ROI and position your brand as a leader in your industry. 

Marketers who have harnessed machine learning and AI technologies are doing just that, leaving their peers scrambling to catch up. According to a report by McKinsey & Co, companies that use AI in marketing can achieve an average ROI improvement of 27% within the first six months of integrating AI into their paid media strategies. For most businesses, this means literally hundreds of thousands or millions added to their bottom line in a relatively short time frame.  Additionally, a recent Gartner study found that 37% of organisations have implemented AI in some form within their marketing processes, emphasising the rapid adoption and success of AI-driven strategies to improve customer experience, conversion and retention.

This blog delves into how AI is revolutionising advertising and why it's an essential tool for modern marketers, offering insights into its benefits, applications, and our very own client success stories. 

What is AI in paid media?

AI in paid media involves the use of machine learning and data analysis to automate and optimise advertising campaigns. This technology leverages large amounts of data to deliver personalised ad experiences to the right audience at the right time, reducing ad wastage and increasing efficiency. 

In short, it delivers more 'bang for your advertising buck'!

How AI Enhances Paid Media Strategies

AI can be integrated into various aspects of paid media strategies through multiple platforms and tools. For instance, Google's programmatic advertising platform, Display & Video 360 (DV360), employs a campaign type called Automated Bidding as its AI activator. Put simply, advertisers set goals like increasing traffic, qualified leads, or sales, and the AI learns how to achieve these goals at the right price through automated bidding in a real time auction.

Another popular web based audience targeting strategy accessible programmatically is called Predictive Audiences.  This method uses AI to analyse past behaviour and predict future actions, enabling marketers to target and engage the right customers more effectively, resulting in higher conversion rates and lower costs to acquire subscribers, leads, or sales.

While Predictive Audiences and Automated Bidding are distinct features, they complement each other to enhance the overall effectiveness of a campaign. Predictive audiences help identify and segment high-value users who are likely to convert, while automated bidding ensures that the right amount is bid to reach these users in the most cost-effective way.

Other examples include Meta's campaign types that utilise AI for audience segmentation and advanced targeting. By analysing user data, AI can identify high-value prospects and tailor ads to their specific needs and preferences, improving engagement and conversion rates. Example of Meta campaign types that utilise AI are:

1.  Dynamic Ads:  Dynamic Ads use AI to automatically show the right products to people who have expressed interest on your website, in your app, or elsewhere on the internet. For example, if someone browses a particular product on your website, AI-driven Dynamic Ads can show that specific product or related items to that person in their Facebook or Instagram feed. This personalisation increases the likelihood of conversion.

2.  Advantage Plus:  A relatively new AI tool that boosts social campaign performance by automating ad creation, targeting, and optimization. It pulls top-performing images and brand messaging to deliver personalized, high-engagement ads. For advertisers, this means increased brand visibility, engagement, and conversions through smarter, data-driven ad strategies.

2.  Lookalike Audiences: Lookalike Audiences allow you to reach new people who are similar to your existing customers. Meta AI analyses the characteristics of your best customers and finds people with similar traits and behaviors. This helps in expanding your reach to a more highly targeted audience that is more likely to be interested in your offerings, thereby improving the efficiency of your campaigns.

Why AI Matters in Paid Media Campaigns

Artificial Intelligence (AI) is reshaping marketing by automating and enhancing decision-making processes. AI uses machine learning to analyse massive datasets, uncovering hidden patterns and consumer behaviours. This allows marketers to:

1.  Target with Precision: AI goes beyond demographics. It identifies your ideal customer based on online behaviour, interests, and purchase history. This laser focus ensures your message reaches the most receptive audience, increasing the likelihood of engagement and conversion.

2. Personalise the Experience:  AI tailors your ad content and offers to individual consumers. Imagine a website that displays products a customer is most likely to be interested in based on their past browsing behaviour. This level of personalisation can significantly boost engagement and sales.

3. Optimise in Real-Time: AI algorithms constantly analyse campaign performance, identifying what works and what doesn’t. This real-time optimisation maximise your return on ad spend (ROAS), ensuring that your budget is always being used effectively.

4. Gain Deeper Customer Insights: AI unlocks a wealth of information about your target audience, providing insights into their preferences, pain points, and buying journeys. These insights allow you to refine your overall marketing strategy, making it more effective and responsive to customer needs.

5. Predict Future Behaviours: AI analyses past data to predict future customer actions, allowing you to anticipate their needs and deliver targeted messages at the most opportune moments. This predictive capability, commonly referred to in programmatic advertising as "Predictive Audiences" helps you stay ahead of the competition by being proactive rather than reactive.

Case Studies

FMCG: Adgility increases WaterWipes New Biodegradable Sales by 22%

Objective: WaterWipes aimed to launch their new biodegradable range, increase sales through key retail channels, and maintain their position as the purest baby wipes brand on the market.

Strategy: Leverage market-leading social and web platforms, Meta Campaign Manager, and Google Display & Video 360 (DV360) to run an omnichannel campaign. This approach allowed for reaching larger audiences more cost-effectively using various AI-fuelled audience targeting tactics for optimization.

• Meta: Used to run a giveaway competition targeting new mums and active parents to educate, generate interest and excitement, and increase subscribers.
• DV360: Employed for an omnichannel campaign including display, native, video, and digital out of home (pDOOH) to scale reach, maximize engagement, and drive in-store purchases.

Execution:

• Social: Ran targeted social media campaigns to engage new mums and active parents, boosting brand awareness and participation in the giveaway competition.
• Web: Utilised AI-driven audience targeting and automated bidding strategies to connect with potential customers, optimizing ads based on real-time interaction and engagement data.
• pDOOH: Placed digital panels strategically outside leading grocery retailers (Coles, Woolies, IGA) to reach and engage shoppers, encouraging point-of-sale purchases at key metro shopping precincts.
• Automated Bidding: Implemented automated bidding strategies to optimise ad performance in real-time, increasing the campaign's efficiency and reach.
• Targeting and Audience Segmentation: Used several different AI-fuelled targeting tactics including Predictive Audiences for precise audience segmentation, targeting new mums and active parents interested in biodegradable baby products.

Results:

• Increase in Subscribers: Saw a 47% increase in subscribers to WaterWipes database, allowing for effective remarketing efforts.
• Boost in Sales: Achieved an 22% increase in sales within 3 months across s all major retail distribution channels (Coles, Woolies & IGA) when comparing previous 3 months.
• Effective AI Implementation: The automated bidding feature in DV360 was instrumental in learning which audience segments were most likely to convert, thereby optimising bids and maximising engagement.

This AI-driven approach not only drove significant sales growth but also reinforced WaterWipes positioning as the premium baby wipes brand in the market.

Fintech: Adgility Drives 38% Increase in Qualified Leads for ClearScore

Objective: ClearScore, a leading credit scoring platform, primary marketing goal was to increase engagement and drive lead capture over key local markets during its peak seasonal period.

Strategy:  Expand audience reach more cost effectively in prime geo locations using display and video over web channels to attract qualified traffic and lead them through the sales funnel. We leveraged programmatic advertising platform Display & Video 360 (DV360) to gain scale quickly and cost-effectively, testing various creative channels, formats and AI-fuelled audience targeting strategies.  This approach enabled us to connect with and engage individuals interested in financial services such as personal finance, credit, home loans, and car loans.

Execution:

1. Audience Targeting:

• Predictive Audiences:  Utilised AI-driven audience segmentation to identify people in the market for financial services.
• Automated bidding: Employed different automated bidding strategies to pinpoint high-value prospects and bring them back at the right cost (eCPA).
• Retargeting:  Created tailored ads and landing pages to meet the specific needs and interests of these prospects who have already been to site and engaged with 2+ more pages.

2. Campaign Optimisation:

• Dynamic Ad Insertion: Utilised dynamic ad insertion to serve personalised ads to users based on their country, browsing history and preferences, enhancing relevance and engagement.
• Frequency Capping: Applied frequency capping to limit the number of times an individual sees an ad, preventing ad fatigue and improving user experience.
• Geo-targeting Adjustments: Made real-time adjustments to geo-targeting settings to focus on regions with higher conversion rates, optimising budget allocation for maximum impact.
• Bid Strategy Optimisation: Continuously fine-tuned automated bidding strategies to ensure the most efficient use of budget, maximising ROI by prioritising high-value prospects.
• Audience Segmentation Refinement: Regularly updated audience segments based on the latest data insights, ensuring the campaigns targeted the most relevant and high-intent users.
• Dayparting: Implemented dayparting strategies to run ads during peak trading times, increasing the likelihood of reaching users when they are most active.
• Cross-Device Tracking: Monitored and optimised cross-device user journeys to ensure a seamless experience and consistent messaging across different devices, improving overall campaign effectiveness.

Results

Our AI-driven approach led to a significant improvement in campaign performance:

• Lead acquisitions: increased between 19%-24% across all market within 6 months from campaign start.

• Reduced eCPA: the AI continuously learned from user interactions, further optimising the campaigns to attract even more qualified leads reducing eCPA by 36% within 3 months from start date.

In summary, ClearScore experienced a 24% increase in qualified leads in its largest metro market, showcasing the effectiveness of AI-driven targeting strategies in achieving marketing goals.

Conclusion

Incorporating AI into your paid media strategy can revolutionise your advertising campaigns and give you a significant competitive edge. By precisely targeting the right audience, personalizing ad experiences, and optimising campaigns in real-time, AI helps you maximise your advertising budget and achieve superior results. Embrace AI to enhance your media strategy, gain deeper insights into your audience, and stay far ahead of the competition.

Contact Adgility today to book a free, no-obligation consultation and discover how AI-powered advertising can transform your business.