Google is set to revolutionize its advertising business by incorporating generative artificial intelligence (AI) into its operations, as major tech companies race to harness the potential of this groundbreaking technology. In an internal presentation obtained by the Financial Times, the Alphabet-owned company revealed its plans to leverage AI to create innovative ads based on materials generated by human marketers.
Dubbed “AI-powered ads 2023,” the presentation emphasizes the vast creative possibilities that generative AI unlocks. While Google already utilizes AI to create basic prompts for user purchases, the integration of its latest generative AI, also powering its Bard chatbot, will enable the company to produce highly sophisticated campaigns akin to those crafted by marketing agencies.
The presentation outlines how advertisers can provide “creative” content, including images, videos, and text, related to a specific campaign. The AI will then “remix” this material, generating ads tailored to specific target audiences and objectives such as sales targets.
However, some concerns have been raised regarding the potential for AI-generated text to spread misinformation, as the AI chatbots may confidently present false information. The worry stems from the AI’s focus on converting new customers, with limited regard for the veracity of its statements.
Addressing these concerns, Google assured the FT that it would implement stringent safeguards to prevent such errors or “hallucinations” when deploying its new generative AI features in the coming months.
This move by Google aligns with the larger trend of tech giants capitalizing on generative AI, which has gained prominence for its ability to create sophisticated content in response to human inputs, such as text and images. Last month, Google introduced Bard as a competitor to Microsoft-backed OpenAI’s ChatGPT, capable of producing convincingly humanlike responses.
Furthermore, Google has recently integrated generative AI into its widely used productivity applications like Google Workspace, Google Docs, and Gmail.
The new technology will be integrated into Performance Max, a Google program that has been available since 2020. Performance Max utilizes algorithms to determine optimal ad placements, allocate marketing budgets, and generate simple ad copy.
The advertising industry is currently facing challenges, including cost control measures and increased restrictions on using personal data for marketing purposes. Google’s advertising revenue experienced a 4% decline in the last quarter of 2022, resulting in Alphabet’s overall revenue growth being just 1%.
Social media platforms heavily reliant on advertising revenues, such as Meta (owner of Facebook and Instagram), are also investing in automation technologies. Meta launched Advantage+ last year, a similar offering to Google’s Performance Max, and aims to incorporate generative AI into its advertising systems by year-end.
How it works?
The integration of generative AI into Google’s advertising business presents an exciting opportunity for enhanced creativity and sophistication in ad campaigns. Advertisers can submit their creative content, including images, videos, and text, for a specific campaign. The AI then “remixes” these materials, leveraging its capabilities to generate ads that precisely target desired audiences and achieve objectives such as sales targets. This process allows for customized and tailored advertisements that can potentially yield higher conversion rates and more effective marketing strategies.
Despite the potential benefits, concerns have been raised regarding the dissemination of misinformation through AI-generated text. As the AI chatbots confidently produce statements, there is a risk that false information could be presented to users. It is important to note that the AI is primarily optimized for converting new customers and may not possess a comprehensive understanding of truth.
To address these concerns, Google has assured the Financial Times that it will implement rigorous safeguards to prevent errors or “hallucinations” when deploying its new generative AI features. By taking proactive measures to ensure the accuracy and reliability of the AI-generated content, Google aims to maintain the integrity of its advertising ecosystem.
The integration of generative AI into Google’s advertising business signifies a significant development in the digital advertising landscape. It empowers advertisers with innovative tools to create compelling and targeted campaigns, ultimately providing businesses with a competitive edge in reaching their marketing objectives and adapting to the evolving dynamics of the industry.