The Unseen Consequences of Automated Online Ads: Rising Fraudulent Activities

Top stories from an overview of what's happening at the intersection of Advertising and AI this week:

• The Unseen Consequences of Automated Online Ads: Rising Fraudulent Activities

• Revolutionizing Food Delivery: Chatbots for Personalized Orders

• Navigating the Risks and Rewards of Marketing Automation

• Narrative Innovation: How Technology is Transforming Marketing Storytelling

  On Edge

• The Creative Frontier: Generative AI and Virtual Production Reshape Advertising

1. The Unseen Consequences of Automated Online Ads: Rising Fraudulent Activities

The issue of fraud in programmatic advertising is a well known phenomenon. According to data from Statista, approximately 20% of ad impressions served programmatically in the United States are directly fraudulent with may more imprssions making their way into dubious Made For Advertising content. These figures are expected to rise significantly in the coming years, posing a serious challenge to the industry.

Artificial intelligence technologies are playing a significant role in amplifying this problem. AI has the capability to create not just bad inventory but also generate fake traffic to these sites. Tyler Nall of Publicis Health Media emphasized in a recent Digiday article that AI can easily create hundreds of thousands of websites with bogus ad impressions, making it exceedingly challenging for industry professionals to catch these fraudulent activities.

The financial ramifications of this issue are staggering. The Association of National Advertisers (ANA) has estimated that the $88 billion open programmatic media ecosystem results in some $20 billion in wasted spending. This accounts for approximately 23% of total investments in the sector. This waste is attributed to a lack of data access, transparency, and other inefficiencies throughout the advertising process.

Given these challenges, marketers are being urged to reevaluate the metrics they use for campaign success. The current focus on CPM incentivizes the creation of more impressions, which in turn leads to more opportunities for fraud. Industry experts are now suggesting a shift towards transacting on cost per engagement or valid traffic as alternative metrics that could provide a more accurate measure of campaign success.

Brand safety is another growing concern in this context. Humphrey Ho of Hylink Group warned that AI-generated content and SEO manipulation continue to attract ad placements on spam sites and ad farms, posing significant risks to brand reputation. Moreover, the use of bots to gather data creates what Vitaly Boitelet of Stagwell Marketing Cloud describes as an "unvirtuous cycle." These bots distort data and weaken the quality of machine-learning insights, further complicating the fight against fraud.

In summary, the rise of programmatic advertising fraud is a multi-faceted issue that requires immediate attention from marketers, ad platforms, and even financial and identity fraud services. The role of AI in exacerbating this problem cannot be ignored, and a multi-pronged approach is essential for tackling this growing concern.

Read the full story here (Paywalled content summarized by Edge)

2. Revolutionizing Food Delivery: Chatbots for Personalized Orders

Uber Eats is taking customer service to the next level by developing an AI-powered chatbot designed to enhance the user experience. According to a recent report by TechCrunch, this chatbot will inquire about users' budgets and food preferences to facilitate quicker and more personalized orders.

This development is part of a broader strategy by Uber to integrate machine learning into its various services. Uber CEO Dara Khosrowshahi recently mentioned that the company already employs AI to match customers with drivers and couriers, optimizing the logistics and efficiency of their platform. The new chatbot is an extension of this ongoing effort to make the entire Uber ecosystem more responsive and user-friendly.

The food delivery landscape is becoming increasingly competitive, especially with the adoption of AI technologies by other major players in the field. DoorDash has announced the launch of an AI-powered voice ordering technology to assist restaurants in managing calls and increasing sales. Similarly, Instacart has launched an "Ask Instacart" search tool, powered by OpenAI’s ChatGPT, designed to offer personalized shopping recommendations to users.

The role of AI in enhancing customer service is becoming more prominent across industries, and food delivery is no exception. These chatbots and voice technologies are not just speeding up the ordering process; they are making it more personalized. By taking into account various factors like budget and food preferences, these AI-powered tools are elevating the customer experience to new heights.

In the broader context, this trend signifies a paradigm shift in how food delivery apps engage with their customers. The integration of AI allows these platforms to offer more personalized and efficient services, setting a new standard for customer engagement in the industry. It's not just about faster delivery anymore; it's about creating a more engaging and personalized experience for the consumer.

In summary, the adoption of AI technologies by food delivery apps like Uber Eats is reshaping the customer experience, making it more personalized and efficient. This trend is likely to continue, setting new benchmarks for customer engagement in the food delivery sector.

Read the full story here 

3. Navigating the Risks and Rewards of Marketing Automation

A recent article by Mark Ritson in Marketing Week warns that the hasty adoption of AI by advertisers often lacks a well-defined strategy and can even dilute a brand's identity. According to the article, more than half of the briefs that brands provide to their agencies lack strategic objectives, and over 60% are unclear about their target audience. This lack of focus is exacerbated when brands indiscriminately adopt AI, often merely to appear modern or innovative.

The dangers of following the herd mentality in AI adoption are significant. Brands risk losing their unique selling propositions and differentiators in a market where AI is becoming increasingly commonplace. The article argues that the value of brand differentiation will only increase as more brands adopt similar AI approaches. However, it's not all doom and gloom. When used thoughtfully, AI has the potential to enhance a brand's unique selling proposition. But this requires a clear understanding of the brand's identity and objectives, something that is often missing in the rush to adopt the latest technologies.

While AI offers exciting possibilities for marketing, its indiscriminate adoption can come at a high cost. Brands need to approach AI with a clear strategy and a focus on their unique selling propositions to ensure that the technology enhances rather than undermines their market position.

Read the full story here 

4. Narrative Innovation: How Technology is Transforming Marketing Storytelling

In an age where capturing and retaining attention is increasingly challenging, artificial intelligence is emerging as a game-changer in the realm of marketing storytelling. A recent Adweek article delves into how AI is revolutionizing personalized, real-time, and socially driven marketing, offering brands new ways to connect with their audiences.

Two key approaches have emerged in this AI-driven landscape: story-led and social-first marketing. Story-led marketing moves beyond traditional campaigns to embrace personalized, purposeful, real-time content creation. For instance, platforms like TikTok have become fertile grounds for this approach, where personalization reigns supreme and adds a new level of credibility to brand stories.

Social-first marketing, on the other hand, transcends mere content publishing to foster dialogue, feedback, and engagement. Brands like Heinz have turned to social media to uncover and highlight their customers' passionate devotion, thereby creating content that is not just about posting but is inherently social.

AI is also streamlining the content creation process. Tools like Adobe Express and Adobe Firefly are making it easier for marketers to create content faster and gain insights more quickly. Services like Sensei Gen AI are allowing marketers to understand their customer cohorts better and deliver content with unmatched speed.

However, as the industry embarks on this exciting journey of AI-driven storytelling, it's crucial to remember that technology must serve the human element of storytelling. The fusion of human creativity and AI prowess can pioneer a new era filled with creative and empathetic narratives that resonate with audiences on a profound level.

AI is not just a tool but a transformative force in marketing storytelling, offering new approaches and efficiencies while emphasizing the importance of the human touch. As brands continue to explore these new avenues, the balance between technology and human creativity will be pivotal in shaping the future of marketing storytelling.

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On Edge

This week, Edge spotlights the transformative impact of generative AI and virtual production on the advertising industry. Developed in collaboration with experts from Wunderman Thompson, Media.Monks, and Publicis Groupe, these technologies are heralding a new age of efficiency, creativity, and personalization.

The convergence of generative AI and virtual production is achieving remarkable outcomes. In the realm of ideation, generative AI accelerates the concepting process, allowing creative teams to explore options and pre-visualize ideas more quickly. Simon Legrand from Untold Studios notes, "AI is very sophisticated in copywriting," making it particularly useful for brands with a defined creative platform.

In production, AI is optimizing workflows and enabling real-time element generation. Filmmaker Kristyna Archer mentions the use of generative AI 3D plugins like Cuebric or Dash, which she calls "game-changers." These tools allow for the creation of more dynamic and realistic visual effects, thereby enhancing storytelling.

The campaign's impact on engagement is significant. Sergio Lopez from Publicis Groupe highlights that AI's ability to process data and modify visuals within minutes is changing how work is adapted and delivered. This leads to engagement boosts of 15-41% for clients, according to Publicis Groupe's DCE tool.

However, as these technologies evolve, the human element remains crucial. Melania Kulczycka from VUFINDER STUDIOS emphasizes that AI should complement and augment human creativity, not replace it. "Embracing AI and understanding its proper utilization is essential for improving our efficiency without undermining the human touch," she says.

The integration of generative AI and virtual production is revolutionizing the advertising industry, offering unprecedented levels of efficiency and personalization. It showcases the potential of AI-based innovations for brands to explore in future advertising endeavors, highlighting the power of leveraging media, creativity, and technology to forge meaningful connections between brands and consumers.

Read the full story here 

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