In my conversations with marketers, artificial intelligence is increasingly top of mind. The reasons why are clear. For instance, a recent McKinsey study across regions, industries, and company sizes found that the value realized from AI has shifted in recent years with marketing and sales reporting the biggest revenue effect.
Today I’d like to address some AI questions I’m hearing in meetings with many of you and to explore how Google Ads products can help marketers deliver the performance and impact you need in today’s increasingly unpredictable world.
Breakthroughs in AI are making it easier for marketers to show up for customers in more connected and consistent ways.
Why does AI matter for marketers?
Over the past several years, people adopted digital in a huge way for just about every aspect of their lives. And we’re seeing many of these new behaviors and habits stick. As a result, it’s harder for marketers to predict a consumer’s next step. The key to succeeding in this new world is being able to analyze huge amounts of data and react to it in real time. That’s why I’m excited about the opportunities AI is creating for marketers.
We’re on the cusp of a technological revolution in AI that’s poised to add immense value for businesses and marketers around the world, much like the advent of the internet did in the late 90s and the emergence of mobile computing did in the early 2000s.
Today’s breakthroughs in AI are fundamentally changing how people interact with technology, while making it easier for marketers to show up for customers in more connected and consistent ways. In fact, we’re seeing AI become a multiplying force for businesses by empowering marketers to stay on top of consumer needs and trends, and jump on new insights to build campaigns faster with proven ROI and performance.
How is AI already being put to work in ads?
Google has been a pioneer in AI development for over a decade, and AI has been foundational to the Google Ads business — from AI-powered creatives like responsive search ads to how we optimize bids for every auction. We’ve also led the way on building AI responsibly, publishing and updating our AI principles since 2018.
Our large language models are now 50% better at understanding human language. That translates into real business results for our customers.
Over the years, we’ve improved these technologies based on feedback from marketers and breakthroughs in Google AI. Our large language models are now 50% better at understanding human language.1 That translates into real business results for our customers. For example, advertisers who upgrade from exact match to broad match (our AI-powered targeting option for Search Ads) in campaigns that use a target cost per acquisition see 35% more conversions on average.2
Performance Max is our new goal-based campaign type that’s powered by AI. It helps find valuable new customers and demand opportunities across all of Google’s inventory like YouTube, Search, and Gmail. On average, we’re seeing advertisers who adopt Performance Max achieve 18% more conversions at a similar cost per action.3 Best Buy, a multinational consumer electronics retailer, is one such advertiser.
Best Buy wanted to respond to the changing business landscape and new consumer expectations by enhancing its performance with Google Ads. The team had used AI applications in other parts of their business and decided to test two Google AI products: Performance Max and broad match. Extensive testing found that Performance Max helped Best Buy increase return on ad spend by 33%, while broad match boosted its omnichannel revenue by 42%.
How do you see the marketer’s role evolving?
Even as more powerful AI technologies emerge, the marketer will remain firmly in the driver’s seat. In fact, we think the marketer’s role has never been more critical.
To deliver these results, it’s critical that the marketer’s expertise is guiding the AI.
AI is a powerful enabler that helps businesses achieve their full potential by coupling the marketer’s expertise with the power of AI in a flywheel that continually drives down marketing costs, improves performance, and helps you discover new customers no matter how unpredictable their behaviors. We’ve found that when we put this flywheel — where AI and marketers learn from each other — into motion, we can multiply business results. But, to deliver these results, it’s critical that the marketer’s expertise is guiding the AI. From budgeting and bidding to audiences and creative, the marketer’s inputs are key in guiding AI to deliver the best ROI and new avenues of growth for your business.
What steps should advertisers take today to prepare for an AI-powered future?
Now is the time for businesses of all sizes to start thinking about their AI marketing strategy. If you are looking for a place to start, Search remains one of the biggest untapped opportunities for advertisers. We believe AI is the technology that will help advertisers unlock the power of Search. As I mentioned, many of these tools are already available today.
Be sure to tune into Google Marketing Live on May 24 at 10 a.m. SGT, where we’ll showcase more AI-powered advertising solutions and discuss the latest marketing strategies with leaders from the world’s most innovative brands.
