How to Use AI in Advertising: Benefits and Challenges (2024)

Today, 95% of marketers believe that artificial intelligence (AI) offers a more efficient approach to campaign management. Many use it to provide a more personalized customer experience.

In this new era of advertising, using AI is key to keeping up with the competition. However, the technology comes with its own risks and challenges. Using it to your advantage requires careful implementation – and a few practical best practices. Learn more about the benefits and challenges of using AI in advertising and how you can use it for your business.

How is AI used in advertising today?

Artificial intelligence (AI) helps companies and the advertising industry design successful advertising campaigns more efficiently. From automating manual tasks and advertising content creation to predictive analytics that enable advanced personalization, AI advertising tools can improve results while saving time and money.

For example, generative AI uses machine learning to create original content such as text and images. Shopify Magic, an AI tool included with every Shopify account, can change the background of images and write product copy, making it easier to update product pages and design ads faster.

“I use Shopify Magic to write product descriptions by entering desirable keywords for SEO,” says Kwame Chambers, CEO of lifestyle brand Glitch Anomaly. “It gives me the opportunity to work more efficiently and save costs. It’s a game-changer.”

Benefits of using AI in advertising

AI can be an invaluable tool for your company’s advertising efforts. There are three benefits to consider here:

Improved efficiency

AI can significantly reduce the time and resources required to create, manage and optimize advertising campaigns. Repetitive tasks that might take human workers hours or even days – such as content creation, data analysis and audience segmentation – can often be automated and carried out in real time by AI systems.

For example, Google’s AI-powered Smart Bidding tool can automatically adjust bids on Google ads, ensuring you stay competitive in search results at the lowest possible cost. This automation minimizes human error and helps marketers save time so they can focus on more strategic tasks like creative development and campaign planning.

Advanced personalization

AI-powered tools like BrightBid enable advertisers to deliver personalized ads at a level that would not be possible manually. Traditional advertising is typically based on broad demographic categories, but AI can go beyond that and personalize ads and ad placement for each audience. By analyzing user behavior and purchase history, AI technology can generate advertising that appeals to specific target groups.

For example, you could use AI to swap creative elements of dynamic ads—like ad copy, product descriptions, or product photos—to deliver exactly what each potential customer wants to see. Placing the right ads to your target audience leads to more effective campaigns and higher click-through rates and conversion rates.

Predictive analytics

AI tools use historical data to uncover deeper insights and patterns that humans might miss (or spend hours identifying). AI predictive analytics tools can predict future trends by identifying patterns and correlations in data. This foresight allows you to make more accurate predictions and develop targeted strategies, adjusting them as necessary to achieve better performance.

Challenges when using AI in advertising

Despite all the benefits, working with AI comes with some unique challenges. There are three issues to monitor here:

Privacy concerns

AI typically requires large amounts of data to train machine learning algorithms. Collection and processing of consumer data – such as browsing habits, purchase history and location data. This raises ethical and legal questions regarding data security and user consent.

Many customers are reluctant to share information, and mishandling it can lead to a loss of brand trust. Regulations like the California Consumer Privacy Act (CCPA) and the European Union’s General Data Protection Regulation (GDPR) also limit companies’ ability to collect data and fully utilize AI.

Be careful when it comes to consumer data. Collect, store and use data responsibly and consult a legal professional to ensure you comply with laws and regulations.

Lack of human touch

While AI excels at data analysis and automation, working on more creative tasks can sometimes leave something to be desired. Generative AI has made great strides in its ability to mimic your brand’s tone in copywriting, but because it relies on existing data patterns, it can’t be truly creative.

To avoid sharing impersonal AI-generated ad copy, focus on delegating the more formulaic and data-driven tasks to AI. Leave creative brainstorming and content development to people who can bring emotional nuance and cultural context to their work.

Inaccurate or biased results

It’s not just people who can make mistakes. Flawed machine learning algorithms can misinterpret information, take satire literally, or simply not have enough data to produce accurate results.

Equally worrying is that AI systems are trained on historical data that may reflect existing biases. For example, AI could favor certain populations or perpetuate potentially harmful stereotypes when creating text and images.

When using AI, always make sure the work is reviewed by a human to avoid sharing false information or content that doesn’t align with your brand’s values.

How to start using AI in advertising

1. Find out how AI can help you
2. Find an AI tool that meets your needs
3. Integrate across different platforms
4. Avoid common pitfalls
5. Invest in continuous learning and adaptation

Want to harness the power of AI to improve your company’s advertising efforts? Use this step-by-step guide to get started:

1. Identify how AI can help you

There are so many different ways to use AI that it’s hard to know where to start. First, consider your company’s advertising goals and identify where you are encountering obstacles in your existing process. Do you want to process large amounts of data? Or do you need help brainstorming the first drafts of blog posts? Knowing where you need help can help you narrow down your options and find a tool tailored to your goals.

For example, an online retailer looking to increase sales could use AI to generate personalized product recommendations based on a customer’s past behavior and purchasing history.

2. Find an AI tool that meets your needs

Once you figure out how you want to use AI, research AI tools that specialize in those functions. You’ll find a variety of options in the Shopify App Store. Evaluate each tool’s features, scalability, ease of integration, and cost.

For example, Wiser is an AI-powered product recommendation app that combines commonly purchased bundles and discounts into a one-click upsell.

3. Integrate across different platforms

To integrate AI across different platforms, use AI tools (such as inCharge) that can unify data from multiple sources, including social media, your website, and email campaigns. Sync AI-driven insights with each platform’s ad management system so personalized ads can be automatically adjusted and placed based on audience preferences.

4. Avoid common pitfalls

Implementing AI is exciting, and when it works well, it can be tempting to leave more and more work to intelligent machines. However, make sure you balance AI automation with human oversight to bring creativity to campaigns and ensure you catch errors. Consider ethical considerations such as privacy by complying with regulations such as CCPA. Monitor AI performance regularly and make adjustments as needed.

5. Invest in continuous learning and adaptation

AI technology is evolving rapidly. So stay abreast of advances and see if your strategies could benefit from new tools. Continue to experiment with AI-powered solutions to ensure your advertising efforts remain competitive, innovative and aligned with evolving market dynamics and user behavior.