AI Briefing: More Companies Advertising AI as Spending Grows

Tech giants and startups looking to stand out spent more than $35 million in the third quarter of 2023 alone, a 550% increase from the third quarter of 2022, noted MediaRadar, which analyzed spending data through September for over 360 advertisers. The total number of advertisers in the third quarter also increased by 135%, from 80 in 2022 to more than 180 in 2023.

Only 6% of AI advertisers spent more than $100,000, contributing $36 million to total spending in the first nine months. The remaining 94% collectively spent only $4 million. MediaRadar highlighted major new advertisers like IBM and Salesforce – for products like WatsonX and Slack GPT – as well as startups like cloud communications provider Dialpad.

The findings illustrate what could happen to this category as AI expands across various business and societal sectors. (In September alone, overall AI advertising soared 730% from August, which MediaRadar said was due to new advertisers and increased spending by IBM in the areas of television and online video.)

In terms of AI ad formats, 34% of total spend was on TV, 29% on online video and 12% on print. Digital advertising accounted for $19.8 million, or 49% of total spending. This included $11.7 million for online video, with digital display and paid social each receiving around $3 million. Exhibitions and event sponsorships accounted for $1.8 million, or about 5%.

As tech giants and startups collaborate and compete, it will be worth watching how marketing strategies evolve in different ad formats. Can newcomers create campaigns like a way to stand outor will be current holders use their size and familiarity to stay on top?

Earnings Season: A Preview of AI in the Third Quarter

It’s earnings season again, and AI is heavily mentioned in third-quarter results and accompanying earnings calls.

• As Meta increasingly focuses on generative AI, CEO Mark Zuckerberg expects AI to be “the largest area of ​​increased investment.” (Meta’s large Llama language models were downloaded more than 30 million times as of September.) However, he said it was difficult to predict the mix of people’s chats with bots and those with humans in various applications. “I think the foundational technology around generative AI is going to significantly transform the way people use each of the different applications that we build,” Zuckerberg said. “I think for Feed apps, I think over time, more of the content that people consume will be either generated or edited by AI.”

• Sundar Pichai, CEO of Alphabet and Google, said the company will continue to work on its generative search products like Bard and will also experiment more with new ad formats native to its search generative experiment (SGE). He also mentioned that the total number of active generative AI projects using Google’s Vertex AI platform increased 7 times. When an analyst asked whether search activity would stay in the search bar or be decentralized to Bard and elsewhere, Pichai said people have “always searched for (information) in many, many different ways” and he doesn’t think this will do it. change.

• Snap revealed that more than 200 million people have used its My AI chatbot, while the total number of messages sent has exceeded 20 billion. Most people still use it on a weekly rather than daily basis, said CEO and co-founder Evan Spiegel. Asked about ad performance in My AI – which is powered by a new partnership with Microsoft – Spiegel said first-time click-through rates “are very healthy” when ads are relevant to users, but did not mention any numbers particular. “The focus has really been on improving relevance, continuing to increase the relevance of sponsored links in My AI,” Spiegel said. “So far, in terms of signal integration, we’re using it to inform categories of interest. I think we can do a lot more in this regard. But we kind of took that first step again with the perspective of testing and learning.

• During the IBM show call for results, Chairman and CEO Arvind Krishna devoted more than half of his keynote speech to the topic of generative AI. In addition to mentioning IBM’s different AI models, Krishna said the top three uses of AI in business, based on current customer interest, will be code modernization, customer service and productivity tools. IBM also plans to launch its new platform by the end of the year to help businesses mitigate risk.

• For Microsoft, CEO Satya Nadella provided a series of updates related to its gen AI tools. On the society call for results, he said, Microsoft Bing users have participated in more than 1.9 billion discussions and generated more than 1.8 billion images. Over the past three months, search and news ad revenue grew 10% and 9% year-over-year – excluding traffic acquisition costs – while Microsoft Edge has now “gained share market for 10 consecutive quarters. Nadella also mentioned that the total number of LinkedIn members watching AI-related courses increased by 80% in the last quarter.

Beyond the black box: regulatory updates

• The Frontier Model Forum – an industry organization focused on developing safe and responsible AI – has announced Chris Meserole as its first executive director. (Meserole previously served as director of the Brookings Institution’s Artificial Intelligence and Emerging Technologies Initiative.) The founding companies of the Frontier Model Forum – Google, Microsoft, OpenAI and Anthropic – also announced a $10 million investment for a new “AI Security Fund”.

• On the regulatory front, nearly two dozen technology executives, researchers, investors and other experts traveled to Capitol Hill for the second “AI Insights Forum,” a closed-door meeting hosted by U.S. Senator Chuck Schumer.

• The United Nations announced the creation of a new AI advisory committee to explore various opportunities and risks and also focus on global governance related to AI.

• On the eve of this week’s AI Safety Summit, the UK government announced plans to create an “AI Safety Institute”. He also published a report examine processes for safe AI. According to the accompaniment political document62% of UK residents said the government should test AI to ensure it is safe, while results vary in other countries.

• This week, the International Association of Privacy Professionals (IAPP) will hold its Global AI Governance Conference 2023 In Boston. Speakers include former New Zealand Prime Minister Jacinda Ardern, as well as various technology executives and privacy experts.

Products requested

• Amazon launched a new AI product image generator for advertisers. In one test, placing a toaster on a kitchen counter next to a croissant resulted in 40% higher click-through rates than an image of the same toaster with a standard blank white background.

• In other image-related news, Shuttershock has launched a new tool that lets people use AI to edit real photos.

• A new tool called Nightshade allows artists to “poison” AI models with corrupted training data. The tool, first reported by MIT Technical Review, gives creatives a way to combat AI models amid a series of copyright issues. (Read more about this in the research paper published by the Department of Computer Science at the University of Chicago.)

• Qualcomm has launched its next-generation Snapdragon chip, which will power AI platforms on various mobile devices. He also announced that the chips will include TruePic technology which will help improve content authenticity at the device level.

• Lenovo and Nvidia announced a new partnership to help businesses quickly adopt generative AI.

Other AI news from Digiday:

• Forbes has launched Adelaide, a new AI generative search tool, which allows visitors to ask questions in the website’s search bar. (Digiday)

• The NBA is experimenting with generative AI content for the 2023 season while testing new ways to analyze and categorize the game. (Digiday)

• As generative AI grows across social media, agencies and brands are exploring new ways to measure content. (Digiday)

• For Digiday’s ongoing WTF series, Tim Peterson created a video that explains content credentials and why they matter in the age of generative AI. (Digiday)