Generative AI is rapidly penetrating advertising: how impactful will it be?

Published: April 21, 2023

min read

In the coming months, Google plans to expand generative AI technology into its advertising operations.

According to an internal presentation to advertisers seen by the Financial Times, the Alphabet-owned company intends to begin using the AI to create novel advertisements brd on materials produced by human marketers.

Financial Times

Google already employs AI in its advertising businesses to create brief prompts that entice users to buy. With the addition of generative AI, the platform will be able to develop highly advanced campaigns.

Google plans to incorporate this cutting-edge technology into its Performance Max programme, which has been in place since 2020.

According to the report, the technology will use an algorithm to identify the best ad placement and marketing budget allocation, as well as generate ad copy.

It is well known that Google's biggest source of revenue is search advertising. Alphabet, Google's parent company, saw a 1% increase in revenue during the fourth quarter of 2020, while Google's advertising revenue fell 4%.

For generating ads using AI, advertisers can provide creative content related to a specific campaign, such as imagery, video, and text. The AI can repurpose the provided content to create advertisements that are tailored to the intended audience and meet specific goals, such as sales targets.

Nevertheless, amid concerns about the possible effect of AI on concerns such as false information, phishing attacks, and cybercrime, Google has announced plans to implement safeguards to reduce these risks when its new generative AI features are made available, according to the Financial Times.

It is also noted that Meta recently introduced Advantage+, a product similar to Performance Max, last year. It also announced plans to integrate generative AI into its advertising systems by the end of the year.

What does the generative AI incorporation into Google Ads mean to advertisers?

Tech giants’ push towards AI technologies is getting hotter by the day. Regardless of economic downturns, all tech companies tighten their belts and come up with something innovative every day to maintain their competitive edge.

Needless to mention, CRM giant Salesforce’s recent announcement to integrate generative AI into its workflow tool.

Now, Google is joining others in the market by incorporating this technology into its ad businesses. With Google Performance Max, which uses artificial intelligence to display responsive ads, already helping advertisers in many ways to accelerate the launch of campaigns, the incorporation of generative AI will possibly level up the game for advertisers.

Enhance the campaign effectiveness:

As generative AI is trained on existing successful campaigns, advertisers will be able to better understand the trends and patterns that work best. This way, advertisers will be able to create campaign ideas that resonate well with their target audiences. As a result, they can boost the engagement and conversion rate of the campaigns.

Maximize creativity:

Be it generating creative taglines or messages for Google Ads, the generative AI incorporation will be immensely beneficial. This will allow advertisers to explore a wide range of innovative possibilities and experiment with creative ideas so as to draw the attention of target audiences and increase the impact of the ad.

Save plenty of time:

Because generative AI can assist marketers in generating compelling content and images and finding the right audiences and placements, advertisers will no longer have the need to spend significant time on all of these processes. As a result, it will save them a significant amount of time, allowing them to focus on other important tasks to help build their brand.

Sharpen targeting and optimize budgets:

With generative AI in place, advertisers will be able to identify the audiences that are most likely to show interest in their products. That is, they will be able to reach the right audiences at the right time. This, on the other hand, prevents advertisers from spending dollars on low-quality audiences. As a result, advertisers can both sharpen their targeting and maximize their ROI with generative AI incorporation.

With that said, the possibility of spreading misinformation is also present when using AI. But, as Google emphasizes implementing strict safeguards to prevent those, we believe the incorporation of generative AI into Google Ads will be a huge game-changer for advertisers.


Bill Walker

Bill is a marketing strategist who believes in the power of storytelling. He's known for his creativity, wit, and ability to connect with audiences across all channels. When he's not crafting marketing campaigns, you can find him hiking in the mountains or reading a good book.


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