Explore how agencies are leveraging AI to surface valuable insights and drive creative success in digital marketing, including predictive capabilities and asset-based approaches to discover new audiences and optimize conversions.
Activate audiences
Leading agencies are leveraging the most recent AI advancements not just to convert a brand's identified "top audiences" and prospects, but also to discover new client categories and pockets of demand. These new clients can eventually become incremental sources of long-term growth. Many agencies, for example, have experimented with wide match, which is driven by Google's AI, to assist businesses in unlocking new search queries that boost performance.
Marketers have always shunned broad-match keyword tactics due to worries about reduced relevancy. Broad match, on the other hand, can recognise more nuanced variations between search queries to better forecast intent given that AI can factor in a larger spectrum of intent signals.
Increase conversions with AI-powered Search advertising
With AI's expanding power, Brainlabs chose to firmly establish wide match as a fundamental pillar of its Search methodology after performing 54 customer tests across 12 verticals across the world. Broad match keywords beat other match types in these tests, which were done using Brainlabs' proprietary tool Hippocampus, producing additional conversions at a lower cost than precise match keywords.
"In the last two years, we've seen a significant shift in a broad match not only being a great way to reach people but also driving great results," said Andy Goodwin, Brainlabs' head of search. "However, measuring the wrong metrics will ensure that your broad match test fails." Broad matches will generate additional income, but they will also reduce your click-through and conversion rates. You'll lose out if you look at measures that are a few steps from the final performance. Broad match can help you get in front of clients who matter as long as you provide AI reliable conversion data connected to business results."
Discover new customer segments
Agencies are assisting businesses in augmenting their consented, first-party data with AI technology to uncover new additional client categories. These organisations are speeding up AI's capacity to learn from existing consumers to locate new lucrative clients.
To unleash future growth, prioritise new client acquisition
iProspect collaborated with H&M's global paid media team to leverage Search to not just boost revenue but also to attract new consumers.
H&M first intended to optimise Search advertising for revenue and return on ad spend (ROAS), a strategy typically used by retailers to generate short-term success. iProspect and H&M collaborated on a study to better understand the impact of sponsored search activity on overall sales statistics over time. They came to some intriguing conclusions. They noticed, for example, that optimising for short-term income caused the algorithms to focus on consumers with a higher conversion rate, resulting in ads that were heavily focused on current customers.
To reach more people who had never purchased at H&M before, the team decided to establish a new critical statistic called "new customer share." To support this important performance metric, iProspect, and H&M needed to first develop a thorough knowledge of the worth of each client category. They created a strategy based on a customer life cycle model using first-party data from H&M's membership club.
iProspect and its client saw a 65% rise in new customers and a 70% increase in paid search income after implementing bespoke revenue multipliers in Google Ads to affect how the system optimises for H&M's consumer groups. "The results are interesting because many would expect the opposite revenue trend, as new customers typically have a lower conversion rate and average order value because they have not yet bought into the brand," says Anna Calciolari, iProspect's global director of product and partnerships.
"We fed the algorithm signals that better reflected H&M's business objectives," Calciolari explained. "We drove long-term growth by prioritising new customers and adapting our bidding strategy, as well as investing resources in strategic tasks such as account restructure and feed and app optimisation."
Asset optimisation
Finding the correct demographic is useless if a business cannot engage them with a meaningful advertising experience. Agencies can also be of great assistance in this regard.
When it comes to AI and innovation, agencies already have high expectations. According to Forrester, the main benefits of AI for agencies will include the expanded capacity to create high-quality creative assets, improved client experience, and improved outcomes for marketing strategies.
Agencies may get the most out of AI-powered features by offering as many creative assets and formats as feasible, such as well-written text, gorgeous graphics, and attention-grabbing videos. AI benefits from having as many assets as possible to determine the most relevant and best-performing combinations for a particular audience and context.
With innovative video creativity, you can increase conversions
Asset testing functionality was utilised by agency SEM and its client LC Waikiki, a market-leading fashion brand in Türkiye, to deploy fresh video creative in Google's App campaigns for installations. The researchers devised an experiment with an even split of the audience and a high 95% confidence interval threshold. They wanted to make certain that the results were as conclusive as possible because the test would have a long-term influence on their app creative approach. They experimented with video assets that highlighted their app's unique selling proposition and limited-time discounts.
The new video assets from LC Waikiki outperformed its evergreen assets, resulting in a 32% increase in installations and a 7% decrease in cost per install across video inventory.
"We know that providing a high number of quality creatives to the smart algorithms of App campaigns is critical for best results," stated Erim Birol, digital marketing manager at SEM. "We were able to observe the incremental benefits with tangible results with this experiment."
Quickly discover new information
Brands rely on agencies to assess the effectiveness of their digital initiatives and determine where to invest next. According to Forrester, 56% of marketers rely on agencies for consumer analytics, intelligence, and insights, and this figure is expected to rise to 73% in the next 24 months.
Agencies used to spend hours manually sifting data-heavy reports to assist their clients in generating useful insights. They may now use tools like Google Ads' Insights page to swiftly curate and surface learnings. These tools assist them in tracking campaign success, troubleshooting problems, and identifying new performance possibilities.
Discover information on lucrative new audiences
After launching a Performance Max campaign for one of its clients, Solutions 8 recognised such an opportunity.
"One of our clients sells shelf-stable food products." (think apocalypse-proof food). This gave us confidence that we were pursuing a certain avatar. (doomsday preppers). "We used Performance Max to advertise products to this audience," stated John Moran, co-founder of Solutions 8. "After running the campaign for a while, we discovered from the Google Ads Insights page that audiences interested in boating and sailing outperformed the client's traditional audiences." When we considered it, it made logical because individuals travelling great distances across the ocean without access to grocery shops require it.
"We gave Google's AI a well-researched audience that brought in results, and it used that as a starting point to find audiences that were even better," Moran explained. Of course, we immediately built advertising assets tailored to that group and launched a fresh campaign for the yachting audience."
Make accurate forecasts
Based on previous data, agencies are also employing predictive modelling to anticipate which consumers are most likely to purchase or churn.
Previously, if a business wanted to reach customers who were most likely to buy, a popular strategy was to establish an audience of people who added things to their shopping carts but did not buy. However, marketers may miss out on contacting those who have never purchased an item but are likely to do so in the future if they use this method.
Today, professional agencies may utilise predictive audiences to assess which consumer activities on an app or website are likely to result in a purchase, assisting in the identification of more individuals who are likely to convert at scale.
Respond quickly to changes in customer behaviour
During the epidemic, the agencies Media.Monks and OMD assisted McDonald's in responding to shifting patterns in Hong Kong. McDonald's was able to employ AI-powered solutions to swiftly gather consumer insights and apply them in ad campaigns to enhance in-app orders and in-store pickups thanks to the collaboration of the two firms.
As McDonald's data analytics partner, Media.Monks collaborated with its client to integrate Google Analytics 4 and begin gathering real-time e-commerce data from the McDonald's app.
"Agencies must have the technical knowledge to assist clients in implementing new solutions, and AI-powered solutions that assist agencies in gaining insights can be game changers," said Billy Kwan, Southeast Asia and Hong Kong analytics head at Media.Monks. "We saw this when we assisted McDonald's in implementing GA4 and identifying predictive audiences."
McDonald's discovered that the "likely 7-day purchasers" category delivered the highest ROI as a consequence of Media.Monks' analytics work. Predictive audience segmentation may then be automatically transferred to McDonald's ad campaigns thanks to the connection of Google Analytics 4 and Google Ads. At this point, OMD, McDonald's media agency, took over. App campaigns, a completely AI-driven Google Ads campaign type that urges app users across Google advertising channels to take action, were recommended by OMD for engagement.
McDonald's Hong Kong raised conversions by 550% among "likely 7-day purchasers" and reduced cost per acquisition by 63% within the same group as a consequence of this activity. Furthermore, McDonald's sales surged by 560% within that group. The McDonald's Hong Kong marketing team is thriving in its digital transformation thanks to this new data-driven approach and key partners on its side.
"We created a powerful tool for McDonald's to reach customers more effectively and drive in-app orders by using the unique insights on likely purchasers and developing a value-based bidding strategy," said Joanna Chow, associate digital director at OMD Hong Kong. "At the same time, we were able to automatically test different text, image, and video combinations to create optimised ads."
"AI enables us to do so much more to increase media efficiency and sales," Chow stated, "and we look forward to seeing more breakthroughs brought about by GA4 and other Google AI-powered solutions."
Take action on AI right now
AI is expanding the role of agencies, allowing them to increase their expertise and focus on new strategic possibilities. For some organisations, this may imply expanding their scope to encompass additional areas such as a first-party data strategy and privacy compliance. Other government agencies are establishing new centres of excellence to maximise AI and build budgeting, bidding, targeting, creative, and insights techniques to achieve better results.
In today's rapidly evolving digital landscape, artificial intelligence has emerged as a powerful tool for digital marketers to activate audiences, increase conversion rates, and discover new customers. AI-powered algorithms and tools have revolutionised the way digital marketers approach asset optimisation, as well as how they discover new information and make accurate forecasts about customer behaviour.
One of the greatest advantages of AI in digital marketing is its ability to respond in real time to customer behaviour, enabling marketers to deliver personalised experiences that increase engagement and drive conversions. DigitalxMarketing leverages AI in our digital marketing strategies, so your business can improve your bottom line while also enhancing the customer experience. Contact us to know more and discuss how we can help you succeed.
Overall, the integration of artificial intelligence and digital marketing has opened up new avenues for businesses to succeed in the competitive world of online marketing. With the ability to activate audiences, increase conversions, discover new customers, optimise assets, and respond to customer behaviour in real-time, AI is a game-changing technology that every digital marketer should consider incorporating into their marketing strategy.