AI Ad Spending Skyrocketed in 2023
If you look at any industry at this point one thing that you will find to be common is the adoption of AI technologies. Marketing world is being ruled by the integration of AI as well. Businesses are integrating AI ads for better customer reach and to offer personalized ads to targeted customers.
Generative AI is becoming one of the most commonly adopted trends of 2023 – The reason? Enhanced creativity, lesser turnaround time to build high-converting ad copies and creatives, and its ability to create personalized content at scale.
Generative AI has tipped the scale towards massive adoption of AI in advertising, hence the increase in AI ad spending.
What’s Fueling the Rise of Spend in AI Advertising?
In the year 2023 it has been observed that most companies and brands have launched their gen-AI tools enabling them to offer better services to their customers, hence generating more revenue. The question of AI ad spending persists unchanged. Here’s the unfolding of events.
In the initial months, over $9 million were invested for ads in different formats such as digital, print, and other AR promotion. This number turned out to be a 9% increase as compared to the year before.
Furthermore, it has been observed that in the third quarter of 2023, the majority of advertisers have spent around $35million on AI Ads which marks an increase of 550% as compared to the year 2022.
This study indicated that brands are preferring to invest in AI ads instead of traditional methods of ads such as print and digital.
What Data Says?
In another report by Media Radar it was further indicated that in just two months June to August, the AI ad spending had reached a record level of $6.8 million. This spend was 60% more than the $4.2 million spent from the previous year. Clearly indicating that businesses are transitioning towards using the AI ads and incorporating digital strategies.
The key point to consider here is that since these brands are integrating different forms and formats of advertisements, it is essential to have an attribution management platform to offer you a detailed understanding of ads, revenue generation, and ad spend. Hence, a right partner such as Trackier is an essential part of this journey.
Commenting on the same, Udit Verma, Co-Founder and CMO of Trackier said,“As Google takes the lead with Performance Max campaigns and AI-powered optimization, and Meta follows suit by the end of 2023, the trajectory of the advertising industry is unmistakably heading towards a significant transformation driven by artificial intelligence.
The imminent AI overhaul, however, doesn’t imply the elimination of ad professionals from the equation. Instead, it signifies a shift in their role, allowing them to concentrate on high-level, strategic decision-making. By automating routine tasks, AI liberates ad professionals to delve into areas that demand human creativity and nuanced understanding.”
Why is AI Advertising Beneficial for the Future?
Based on the current trends observed in the AI ads spending, experts have concluded that this trend is going to go more viral in the coming years, especially in 2024. The reason being the introduction of new and advanced AI tools integrated.
Since AI is becoming more and more acceptable and advanced, it is being integrated into different divisions such as performance marketing. Some of the biggest spenders are: IBM (IBM watsonx), Microsoft (Microsoft 365 Copilot), Dialpad, Salesforce (Slack GPT), and YourHana.AI.
All these tech leaders have been working on launching next genAI tools and have further spent on AI ads. The total count of AI advertisers in 2023 increased by 135% where 180+ AI advertisers were compared in the MediaRadar’s report.
Concluding Thoughts
In the marketing world, in today’s era the majority of CMOs and leaders have admitted to using AI tools. In a report by Matter Communications, it was found that around 41% of these marketers use these AI tools regularly. With AI ads offering more clarity and widespread use of AI tools, the use of AI ads is bound to have substantial growth.
