Global research study examines the adoption of and potential uses for machine learning in brand's online advertising operations
Dubai, United Arab Emirates – 7 January 2018 – Criteo (NASDAQ: CRTO), the leading commerce marketing technology company, has commissioned IDC to conduct a global research study to explore the present and future impact of the application of machine learning on advertising creativity. The research published in an IDC White Paper entitled “Can Machines Be Creative? How Technology is Tranforming Marketing Personalization and Relevance” , highlights the drivers and concerns of using programmatic advertising content, revealing how machine learning has the potential to transform future advertising and creative methods by delivering mass creative personalization.
The study found that marketers are transitioning from creative content produced by humans toward content produced by machines, and plan to use machines to automate the personalized delivery of creative content via online advertisements, for individual consumers. 64% of marketers believe optimized message targeting and real-time personalized advertising insertions are primary growth areas where machines will consistently and effectively be delivering business benefits by 2020.
Managing Director Emerging Markets Criteo, Dirk Henke, said, “As smart technologies like data analytics, automation and machine learning continue toward their inevitable convergence, marketing and advertising will experience yet another dynamic shift which will transform the nature of these industries. Machine learning and automated personalization will eventually reach a point when their functionalities will be unified enough to automate the production of personalized creative content and deliver it to consumers in real time.”
Although marketers are aware of the value and benefits of machine learning within the context of personalization, few are currently using it for this purpose. This is due to a lack of internal expertise and trust in machine-learning technology to provide the required level of customer data privacy and brand control.
According to the White Paper, “IDC believes these brand concerns will gradually be assuaged as machine learning becomes more established within online advertising operations, and forecasts that machine learning will become pervasive across all elements of the advertising technology industry supply chain over the next five years to 2022.”
“The future in which AI (Artificial Intelligence) will be increasingly pervasive and operational in the global economy is nearer than ever. It is critical for organizations to begin thinking about the momentum driving these technological advances and the direction in which it is proceeding, to outline a growth strategy that will drive competitiveness, profitability, and most importantly, engagement in our digital age”, added Henke.
IDC predicts that spending on AI software for marketing and related businesses will grow at a very fast cumulative average growth rate (CAGR) of 54% worldwide, from around $360 million in 2016 to over $2 billion in 2020.
Some of the key findings of the survey are as follows:
- Digitizing Marketing Communications for Personalization is Now Table Stakes – 34 % of advertisers and marketers are using digital technologies to personalize marketing communications.
- Digital Enables Automation of Creative Content Personalization - over 50%, of our sample uses digital technologies to automate the personalization of creative content in marketing communications and over 30% plan to use digital technologies to personalize creative content in the future.
- Familiarity with Machine-Learning Applications is High, but Usage is Low - 83% of the sample are familiar with machine-learning applications for communications personalization, only 14% are using it today. 33% of marketers are planning to invest in machine-learning technology for communications personalization, which suggests that latent demand is strong and the market willgrow significantly in the coming years.
- Machine Learning Delivers Applications Today, with More to Come by 2020 – 66% of respondents believe that machine-learning technologies for personalized headlines and advertising copy; personalized advertising design formats such as layout, color sets, and sizing; and personalized advertising creatives are deliverable today.
- Data-Driven Advertising Will Drive Customer Loyalty and Brand Relevance - Today, brands' advertising agenda is focused on generating customer loyalty (cited by 41%), gathering customer data (36%), and remaining a relevant brand that is at the top of consumers' minds (34%).
The incorporation of machine learning into automated, targeted personalized creative content, as well as its generation, represents the next frontier to be transformed by machine learning technology. These attributes maximize the brand's opportunity for customer retention and life-time customer value (LTCV) to assure enterprise revenues and cash flow, and if utilized properly by early adopters, stands to be a powerful vehicle for the sustainable growth and competitiveness of organizations in the digital world.