Online advertising revenue has continued to tumble in recent years, thanks in part to increased regulation and an uptake in consumer privacy controls. But how will AI factor into ad-tech, and will you even know you are being marketed to?
Attention seeking and data mining worked for a while
For years online advertisers had it good. They were able to utilise the power of the almighty internet cookie to target audiences of interest, tracking users across the web and serving up uncannily specific ads based on the data they harvested. Many in the know disputed the ethics of such activity, whilst the general public both praised the convenience of federated services yet seemingly grew more suspicious at the near surgical precision of targeted advertising.
Some went so far as to question whether Big Tech was listening to their phone calls, or scanning their emails. After all, how could they possibly know what you were interested in outside of what you searched for online? Well, turns out that ad-tech is both interconnected and baked into everything. Apps, games, and all manner of online services are funnels of data, providing a rich tapestry of your personal likes, dislikes and purchasing habits. Each page, post and pin you visited builds a profile that online advertises can tap into in order to serve you the most relevant and effective ads.
Then came the algorithms and everything got a little crazy.
TikTok deploys an endless feed of algorithmically-tuned videos that will encourage you to never put down your phone. Ever.
Notifications and like-counts alone were no longer enough to keep users hooked. Social media apps and content platforms began prioritising information that received the highest engagement. Browsing, search and watch history informed the algorithm as to your viewing preferences, and each scroll, tap and pinch ever guided these systems toward serving you ads based on your behaviour. Like a finely oiled machine, these platforms would learn what it would take to keep you glued to your screen, and reinforce that action with targeted and highly-engaging content. Anyone that has used TikTok for even a few hours knows this. With little prompting, the app will deploy an endless feed of algorithmically-tuned videos that will encourage you to never put down your phone. Spliced between are direct-to-consumer ads, sometimes in the guise of product placements and less overt marketing.
It was the perfect storm, until it wasn’t.
Advertising under fire
Facing increased scrutiny from regulators and privacy pundits, along with rising consumer awareness, surveillance advertising and the attention seeking economy was ripe for some disruption of its own. Suprisingly, change came from a place that many would never expect – Big Tech itself. With the release of Apple iOS 14.5, a new App Tracking Transparency feature landed onto millions of phones, dealing online advertisers a huge blow through powerful and easily accessible privacy controls. Released alongside promotional information that educated users on the privacy risks of surveillance tracking, the update provided users the ability to block ad tracking from apps and websites. A user prompt would flash onscreen when the system detected information tracking was at play, allowing those to opt out if they so wished.
One consequence of this was that the general public now began to notice just how frequently their data was being requested, and by whom. Millions decided to block requests from the likes of Facebook, who relied heavily on data-mined advertising for revenue. So heavily, that in 2022 the company reported a drop in advertising to the tune of $10 billion USD. Further ripples have been felt throughout the tech sector, especially among social media platforms, who themselves are reeling from reduced ad-spends due to ongoing fluctuations in the global economy. Others, like Twitter, have seen drops in ad-revenue of up to 23% in 2022, and forecasts suggest this will drop by a further 40% in the next earnings period (though admittedly the platform itself is going through a rough transition as it grapples with new management).
Having the social giants and ad-industry on the ropes, must be leading to a happy ending, right? Well, not so fast.
Artificial Intelligence is a gamechanger
The thing about AI’s is, especially the generative kind like GPT, is that they have already been fed huge quantities of data just to get them off the ground. Data that has been sourced from every corner of the internet. Data that users continue to contribute toward with every AI interaction, be it conversation, prompt, face filter or image generation request. Just when we seemed poised to get a handle on the use of our personal information from the clutches of data-brokers, AI threatens to blow things wide open. All this, without a regulation in sight.
Imagine a world where AI scans your documents, emails and other digital activities. It follows you around the web, offering help and assistance, whilst also keeping tabs on your likes and dislikes. Sounds eerily similar to the data trackers we’ve just blocked, only with far reaching efficacy. How long before AI’s are infused in marketing or advertising strategies?
Big Tech will soon enable advertisers to utilise generative AI for their ad campaigns, helping them regain their laser focus and precision.
Turns out the answer is, any day now. Big Tech will soon enable advertisers to utilise generative AI for their ad campaigns, helping them regain their laser focus and precision, resonating with potential audiences like never before.
But, you might be thinking, I made it through the era of television advertising and then target ads served up on social media, surely AI will be no different? What if every ad is powered by the equivilent of all of humanities’ combined knowledge? And what if those ads are in fact served by your trusty, handy and reliable AI chatbot? How would you be able to tell what is and what isn’t an ad? Where will the data be sourced from, and will it follow you across devices and accounts?
All of these are questions worth asking as we grapple with this new technology. With AI companies locked in a battle for superiority (and market share), combined with the slow place of government regulation, it is almost a certainty that AI will increasingly disrupt life as we know it.
How long before your next AI-chat interaction turns from you researching a product, to being guided toward a purchase by that same chatbot… and could you tell the difference between unbiased help and sponsored recommendations?
The solution would appear to be slowing down development of AI systems in time for regulators to catch up. But at this point, is that even possible? Perhaps instead we need some white-hat tech startups to come along and foster development of even better AI tools that can help us reign in this new ad-paradigm before it gets away from us. In order for that to happen, demand for a better system needs to exist. Let’s hope that people realise that for a fleeting moment, we have the upper hand over advertisers and that our personal data appears to be respected. It’s a feeling worth preserving.