The Impact of Generative AI on the Future of Advertising
I recently had the opportunity to attend Google Marketing Live (GML) 2024 at Google’s Mountain View headquarters, and what I witnessed was truly remarkable. Google unveiled over 30 new features designed to enhance advertisers’ capabilities, with a particular focus on ecommerce. However, there were notable gaps in terms of B2B use cases. One of the most significant trends that emerged from the event was the impact of generative AI on the future of advertising.
Generative AI is set to revolutionize technology and greatly influence consumer behavior, which will subsequently affect how advertisers connect with consumers. During GML 2024, Google provided a glimpse into the future of search advertising and highlighted the potential changes that generative AI will bring.
One of the key aspects of this future vision is the concept of omnipresent generative assistants. Philipp Schindler, a Google executive, demonstrated how AI can act as a constant helper for people. This means that advertisers will have continuous opportunities to connect with consumers in meaningful and helpful ways. The generative assistant can also serve as a digital memory, helping consumers recall past experiences and creating additional marketing opportunities.
Furthermore, there is a growing trend of hands-free assistants that are emerging in the market. These assistants, such as Meta’s AI Glasses and button-like assistants like the Rabbit R1, Humane AI Pin, and Limitless Pendant, allow users to interact with their environment without needing to pull out their phones. This opens up new possibilities for advertisers to connect with prospects and customers in more convenient and seamless ways.
Generative AI also has the potential to enhance consumer memory. Through multimodal inputs such as cameras and microphones, AI can understand and interpret consumer behavior. This offers advertisers new opportunities to engage with consumers even after they have expressed interest in a product or service. For example, consumers can ask their assistants to remember specific items from conversations and help them find similar products nearby. This expanded memory capability reduces the reliance on keywords and enables advertisers to deliver more relevant results based on user intent and engagement history.
Another significant impact of generative AI is the potential for custom ads when creative costs approach zero. As technology continues to advance, the marginal cost of creating personalized content is decreasing. We are already seeing examples of generative AI cutting the cost of production dramatically in the entertainment industry. This opens up the possibility of creating custom commercials that are tailored to each consumer. Imagine watching a car commercial where the driver looks just like you, and the car is driving around your city. These personalized video ads have the potential to significantly boost conversion rates.
Generative AI also has the power to increase conversion quality by reducing transactional friction. For example, a storage company used generative AI to classify furniture and estimate its sizes based on photos. This removed the usual friction of deciding the appropriate storage unit size after clicking on an ad, making it easier for consumers to reserve the best product for their needs. By streamlining time-consuming tasks and providing more appropriate suggestions, generative AI can accelerate the decision process and help advertisers identify high-quality leads more efficiently.
In conclusion, GML 2024 showcased a future where generative AI transforms advertising by offering immediate solutions and a visionary outlook for the years ahead. While the focus was primarily on ecommerce advancements, it is evident that generative AI has the potential to reshape B2B marketing and lead generation as well. Advertisers can enhance efficiency and effectiveness by leveraging AI-driven tools, integrating first-party data, and reducing transactional friction. As we navigate these changes, staying adaptable and embracing innovation will be crucial for maximizing the opportunities presented by this new era of advertising.
