Advertising Revolution: How AI Disrupts Digital Ads

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0:37And we're going to talk about a couple announcements out of Google and Meta, which obviously owns Facebook, and what they are doing to integrate AI into their current ad businesses. So the first thing is, today, Meta announced that they're introducing something called AI Sandbox for Advertisers, and they're expanding their Meta Advantage suite. Essentially what's happening. I think they're really just trying to capitalize on AI and the buzz around it for a lot of this stuff. They do have a few pretty cool features, though, that they're adding into this. And this is something that I see as a trend across like a lot of different companies.

1:12The fact that companies are using AI is not new, right? This has been around for a while. This has been a buzzworthy topic for quite a while now. but a lot of people seeing everything that's happening in the news now are kind of trying to capitalize on it more now than before I would say and so this announcement from Facebook you know they're like since the earliest days of newsfeed in 2006 we've used machine learning and AI to power all of our apps and services blah blah blah they go on but like yeah they've been using AI since 2006 like this isn't this super new thing so some of their announcements I'll glaze over because I think they're kind of nothing burgers or whatever they're not that important but This is what I do think is cool.

1:51They announced that they will be doing text variations in their sandbox. So you'll be able to generate multiple versions of text to highlight the important points of your ad copy. And I think they're also going to do background generation. So like if you have a picture of a watch, they'll remove the background and add a new background that is like an image generated. and they'll do image outcropping which essentially just adjusts your ads to fit different aspect ratios um so like in you know instagram reels or stories uh there's different aspect ratios and i guess they're calling the image outcropping ai i mean i guess it's ai it seems really not very exciting right it's like you have a picture of a toothbrush and there they choose how to auto crop it into a square instead of a rectangle like i guess you need ai to identify that the product is in the middle.

2:44So it's not just like, it's straight up, I don't know, whatever, that doesn't seem that exciting. But anyways, that is one of their announcements. Now, I'll tell you why I think this is actually bigger broadly, not necessarily for what this is exactly, but for where this is going. I think this is going to be massive. In the future, these people, this is what they're going to inevitably add. Because we start we start seeing it here where like essentially you throw in like some text and they use AI to generate more text. And Google announced something recently in along the same line that we'll cover in a second.

3:17But anyways, where I think this is going overall, why I think this is relevant, and I'm talking about it today is because inevitably in online ads, what's going to happen is you are going to take a picture of your product, it could be a terrible picture, you could literally take your phone, you know, you can walk into your warehouse, see a picture of like a couch, you're going to sell, take a picture of the couch on your phone, upload it, then say, you know, this is the price I would like to sell it at. And then Facebook or an ad thing is going to be able to take that image, they're going to be able to upscale it, they're going to be able to make it look really nice, you're going to be able to put that in like a living room setting, they're gonna be able to have design all around it, they're going to be able to manipulate the image and the different angles that you're looking at the image, you know, this is something that is going to be possible, we're seeing similar things literally with, they'll be able to take that image and turn it into a video.

4:04They're gonna be able to take that video and look at it from different angles. This is all literally stuff that is quite possible. Synthesia just yesterday announced that you can upload a video shot from two angles and they can take that through an AI and look at like 360 degree any angle, any way you want to look at that object or subject. This is all going to be integrated into advertising. So eventually you'll be able to take a picture of a thing and they will be able to put it in the most amazing, sexy, beautiful lighting and like, you know, whatever your product or object is, it's going to look incredible.

4:38They'll be able to turn it into video and text. They're going to have automatic text generation for all of the, you know, for the descriptions and the titles and they'll, they'll A-B test everything to see which titles perform the best, which videos perform the best. It might even be to a point where like you pay more to have them do more variations. It's like, look, all you do is uploaded this little, you know, kind of junky image. If you want us to be able to make like 20 full on TV commercials out of this thing, essentially, or like, you know, product sizzle reels or hype videos from all these cool angles and all this cool editing, it's going to cost you x, y, and z and computational power.

5:15And so you just like pay the price, and they'll do all the work for you. And they'll be able to do it. Now, there is a big concern when we look at like, inevitably, this is how ads are going to go, Like you just know that we're starting there. This is the very beginning. That's how it's going to go. You're going to take a picture of your product or you're going to write a quick description of your thing and it will generate all the stuff, make it look amazing, make videos and all your ass, all your brand assets you need. So it's interesting because it's like what role does a modern day graphic designer and copywriter and all these different people play in this kind of sphere when AI is inevitably going to be able to do this.

5:54and it's going to get more and more hands off. So that's a question you would you'd have to ask yourself, perhaps. Yeah, it's going to be very interesting. That aside, I think one of the biggest issues that I can think of, and that people have voiced concerns around this trajectory, because Google is also going down a very similar route, is what happens when the AI makes up false information about your product, right? Like what happens when you take a picture of your couch, and it kind of like maybe it's like a beige couch but beige didn't perform as good as a gray couch so it has like it like cranks up the contrast essentially and the couch looks a little bit more beige in this photo someone buys the couch it comes in or i'm sorry it looks more gray the couch they buy the couch it comes in and all of a sudden they're like hey i ordered a gray couch not a beige couch but like that's what the picture looked like because google found that's what performed the best or facebook or whoever um i think that's the problem another thing is like when you want it to auto-generate captions and text and features about your product.

6:55Like, obviously, you could put stuff in there, but it's going to make stuff up. It's going to add extra information. And what happens when they say, you know, this couch will last you 10 years because of the high quality and it's just some cheap Chinese couch and it only ends up lasting six months and someone's like, hey, what the heck? And they go contact the company and said, you said this will last 10 years. And they said, no, we didn't. and then, you know, like it was in the ad. So those are the issues is like false information or embellishment. I mean, this isn't also super far off from ad agencies and advertisers in general.

7:32Some people I know will hate that. I come from a marketing background. There's plenty of marketers that embellish and, you know, hype up their products beyond what the product team would like them to say. Lots of salespeople do the same thing. So if this AI is doing that, is that even far off from you know what people are doing obviously it would be considered like ad fraud or something like that so not good Google is actually going to be essentially doing the same thing with their ad business in a way apparently they did some internal presentations and someone someone at the Financial Times saw them and essentially what they're doing is it's generative AI to kind of what they say unlock the world of creativity but you know, pretty much what they're doing is integrating their bar chatbot and the AI technology behind that to help supply creative content and images and videos and texts related to a particular campaign.

8:27So essentially, the AI is going to remix all of the content you give it, right, you could throw out a whole bunch of videos and text and images about whatever your campaign or product is, they remix that, and they generate ads based on the audience it aims to reach, as well as any other goals like sales targets and that kind of stuff you have. So someone that apparently was familiar with Google's presentation said that they were worried the tool was going to start spreading misinformation like we're talking about because essentially the text produced by iChatbots definitely can say falsehood. So the problem I think with all of this is that you know it's optimized to convert new customers but it doesn't you know it unless you specifically instruct it, it may not have any idea what truth actually is.

9:10And so Google actually ended up telling the Financial Times when they reached out about the story that they planned to put firm guardrails in place to prevent that kind of errors, those types of errors, right, the hallucinations or whatever you want to call them. So when it really ends up rolling out this new AI feature in the coming months, that should be fixed, they said. So it's going to be really interesting to see where that goes to see where all these new AI ads go. But inevitably, I think we're moving to a space where you have very minimal inputs, right? Like the easier, the better, the easier the product and the easier services, the more used it will be.

9:48So the easier, the better people eventually are going to put minimum inputs, right? So probably like a photo of their product, and Google will be able to generate all of the ad assets around that and be able to optimize them based off what people click on what they interact with and what they buy the most of and that is going to be the ads that people begin to see online so it's going to be a really interesting space to watch obviously google and meta have some preliminary stuff they've launched but very soon we're going to start seeing i think a more broader and a more full rollout of some very robust ai tools that really start taking over the advertising space and start disrupting this industry in a very big way.