In 2018, Marketers Will Discover More AI Applications in Programmatic Advertising - eMarketer

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In 2018, Marketers Will Discover More AI Applications in Programmatic Advertising

December 6, 2017

Chris Victory
Vice President, Partnerships

Even when digital ads are highly targeted down to individual users, it’s hard to get consumers to pay attention to them—let alone interact with and enjoy them. Using artificial intelligence (AI) to further optimize digital ad spending is the next step marketers are taking to make ads a more welcome part of consumers’ digital lives. eMarketer’s Tricia Carr spoke with Chris Victory, vice president of partnerships at demand-side platform MediaMath, about the demand for AI in the programmatic advertising space and the core elements of his company’s partnership with IBM’s Watson.

p>eMarketer: Are marketers typically aware the benefits of AI in programmatic settings, or are you doing a lot of education on this front?

Chris Victory: Marketers who use programmatic advertising have seen the benefits of implementing machine learning into their decisioning and spend of their marketing dollars. AI is the next step in this journey, and everybody is super excited about it. But the challenge lies in delivering something that goes beyond what machine learning does today and is truly artificial intelligence. Those in the programmatic setting are perfect candidates to use the next generation of AI, because machine learning is core to what they do and it’s much more palatable to them.

eMarketer: How are you helping to propel the use of AI in this sense through your partnership with IBM Watson?

Victory: There are three main areas where we focus on the power of AI. The first is infusing AI into the decisioning process on how to better spend your money. Today that’s based on machine learning, but think about all the additional data that can be ingested, like sentiment and mood of the user, and a deeper contextual analysis of a page. These types of things are driven by AI and can be infused into the bidding process to make better decisions.

The second is AI-driven ad creative—it’s like the next-gen version of dynamic creative optimization—to deliver things like interactive ad units. For example, you can interact with an ad by asking a question, and it will give users different answers based on the question asked.

The third is using AI across customer analytics and marketing insights. Today you can look at analytics through a number of different technologies that give insights into your customer base. But the next generation of that is using AI for more predictive analytics. For example, don’t just tell me who my lapsed customers are, but show me who my potential lapsed customers are based off of behaviors. Then you can create user segments to target with specific messages related to their potential of becoming a lapsed customer.

eMarketer: Are there any roadblocks in the industry preventing marketers from experimenting with AI to optimize their programmatic advertising?

Victory: There’s a lot of noise out there—this doesn’t just apply to AI, but marketing technology in general. AI is the buzzword now, and there are a lot of companies getting money from venture capitalists because they have AI in their strategy. But it’s getting harder for a marketer to cut through the noise and understand exactly what they can do with AI—what’s real and what’s not.

eMarketer: Will consolidation happen in 2018, or is it a long way off?

Victory: I think there will be a proliferation of companies before there is consolidation. Next year will be interesting. You’ll see a lot of companies coming in.

There will be a real need for agencies to play a role here and become experts in the use and the application of AI, because agencies are engaged with their clients. It’s very similar to the evolution of the agency role in the programmatic world.

eMarketer: What else do you expect to happen in this landscape in 2018?

Victory: There will be a lot more marketers and advertisers jumping in headfirst to embrace and adopt AI. Once they start seeing the results of some of the applications of AI, there will be a snowball effect and people will want to do more.

There will also be continued proliferation of companies in this space and in the different applications of AI. Virtual reality has been the hot topic for the last year and a half, but now AI is. It’ll be interesting to see where venture capitalists make their nest here, and where that directs the market.


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