Around 32% of marketers report using AI in paid advertising, and startups are increasingly turning to AI for tasks such as writing ad copy and optimising budgets. However, AI can offer much more when applied strategically. It can improve targeting, automate repetitive marketing tasks, and optimise ads and creatives in real time.
In this article, you’ll explore:
- Unlocking AI’s potential for your campaigns
- Top AI tools and how to use them
- Overcoming challenges to improve campaign performance with AI
Understanding AI in Paid Advertising
AI in advertising refers to the use of machine learning models to automate, optimise, and enhance ad campaign performance. It can be applied across various aspects of paid ad management, including:
- Automated bidding
- Audience targeting
- Ad creative optimisation
- Predictive analytics
- Brainstorming
Why Startups Should Leverage AI in Their Ad Campaigns
AI can help startups manage costs, scale, and reach the right audiences:
- Manage ad spending: AI can reduce spending on low-converting audiences. For example, Google Ads’ smart bidding helps target high-intent users.
- Scale content creation: AI tools can scale ad copy and creative production. AI-powered Lookalike audiences also help startups expand their reach.
- Enhanced targeting: By feeding data into AI models, startups can target audiences more precisely. For instance, a FinTech startup can focus on users who have previously engaged with financial content.
AI’s Role in Improving Ad Creative and Copy
While AI is increasingly used to create ad copy and creatives, its outputs can often be generic. Startups should be cautious about over-relying on AI, as human expertise is still needed to fine-tune campaigns. Kieran Flanagan, CMO of Zapier, highlighted this in a recent podcast, discussing how AI should reflect human knowledge to create effective marketing strategies.
The takeaway: AI can help startups compete with larger companies, but expert human input is crucial for achieving the best results.
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Key AI Tools for Startup Ad Campaigns
Popular AI tools like ChatGPT and Gemini are essential for content creation. Ad platforms like Google and Facebook also provide built-in AI tools, including:
- Google Ads: Performance Max, search ads, demand generation campaigns
- Facebook Ads: Meta Advantage, text generation, Advantage+ creative
How Startups Can Leverage AI in Advertising Campaigns
Here are four key areas where startups can use AI to improve their ad campaigns:
AI-Driven Targeting: AI can segment audiences into groups, such as abandoned cart users or one-time landing page visitors, enabling remarketing. Facebook’s Lookalike Audience feature helps target high-value users who resemble your current audience.
AI-Powered Bidding Strategies: AI algorithms adjust bids based on real-time data, optimising ad spend. For instance, Google’s AI-driven smart bidding can target high-intent users without exceeding your CPA goals. FishingBooker, for example, increased their ROAS by 49% using smart bidding.
đź’ˇ Tip: For sales-focused campaigns, start with AI-driven bidding strategies like ‘Maximise Conversions’ or ‘Maximise Conversion Value.’ However, human oversight is still needed to set realistic CPA and ROAS targets aligned with business margins.
Real-Time Ad Optimisation with AI: AI supports Dynamic Creative Optimisation (DCO), allowing you to personalise ads based on real-time data. Google and Facebook both offer DCO features to serve the most relevant ads at every impression. AI tools can also A/B test multiple ad variations and identify top performers.
Predictive Analytics for Future Campaign Success: AI analyses creative elements and predicts future performance based on historical data, enabling you to tailor future campaigns more effectively.
Overcoming Challenges in Using AI for Advertising Campaigns
While AI offers many advantages, it comes with challenges such as:
- Cost and complexity: Building predictive models requires technical expertise, which may not be available to all startups. 5 Blocs can help bridge this gap.
- Data quality: Clean, organised data is necessary for AI to optimise campaigns. Startups often struggle with scattered data, which can hinder AI performance.
- Human oversight: AI systems don’t understand business goals or strategy as humans do. Regular monitoring of KPIs like CPCs, CPAs, and ROAS is essential for campaign success.
Future Trends in AI-Powered Ad Campaigns
As AI evolves, here are some key trends to watch:
Conversational Ads: Automated, messaging-based ad campaigns powered by chatbots are gaining popularity. For example, LinkedIn’s Conversational Ads enable more personalised engagement based on a customer’s journey.
Augmented Reality (AR): AR offers immersive product experiences to boost engagement. For instance, Revolut recently partnered with Apexl Studios to create an AR experience for its Ultra metal card.
AI can unlock immense potential for startups, but expert guidance is crucial to avoid costly mistakes. 5 Blocs offers a combination of human expertise and AI solutions to help you make the most of your ad campaigns.
To see how 5 blocs differs from traditional marketing agencies, click here.