AI In Programmatic Advertising: Here’s What You Need To Know

Learn how AI is improving programmatic advertising with smarter predictive targeting.

A November 2023 survey of U.S. programmatic advertising leaders showed that 52% believe AI is key for demand-side and supply-side platforms. Brands, agencies, and publishers use AI to improve how they reach their target audience. But how exactly does AI change programmatic advertising?

In this blog post, we’ll look at how AI is shaping the industry, share real success stories, and discuss the challenges and future trends ahead.

But before we get to that, let’s take a quick refresher course on artificial intelligence.

What is artificial intelligence (AI)?

Artificial intelligence (AI) is a field of computer science that creates machines capable of performing tasks typically requiring human intelligence.

Gartner defines AI as the application of advanced analysis and logic-based techniques to interpret events, support and automate decisions, and take action. So, in simpler terms, AI enables machines to learn, reason, solve problems, understand language, and recognize patterns.

AI vs. ML

Artificial Intelligence (AI) is the broader concept of machines performing tasks we consider "smart." In programmatic advertising, AI automates the ad-buying process, analyzes data, recognizes patterns, and makes real-time decisions.

Machine learning (ML) is a subset of AI. It trains algorithms to learn from data and make predictions or decisions. ML is one of a few methods used to achieve AI. While AI encompasses various technologies, ML focuses on using data and algorithms to help machines learn and improve over time.

In programmatic advertising, AI manages entire campaigns, while ML fine-tunes targeting and personalization based on user interactions and feedback.

The role of AI in programmatic advertising

AI plays an important role in programmatic advertising: it automates the buying and selling of ad space and helps advertisers target the right audience more effectively, create personalized ads, and optimize ad placements in real time. 

By analyzing vast amounts of data quickly, AI improves the efficiency and effectiveness of advertising campaigns. This integration of AI into programmatic advertising is empowering the industry, making ads more relevant and engaging for users, while maximizing return on investment for advertisers.

Present applications of AI in programmatic advertising

AI is transforming programmatic advertising through several key applications:

1. Predictive targeting

AI-driven predictive targeting uses data analysis and machine learning to forecast and target the most relevant audience for ads. This enhances engagement and advertising performance.

For example, Quantcast's AI-driven platform leverages real-time data to create custom predictive models for each campaign. It forecasts potential reach, impressions, and engagement for your ad set. With these insights, you can fine-tune your campaigns to ensure they reach the most relevant and responsive audience segments.

2. Consumer behavior insights

Consumer behavior insights reveal what motivates and engages audiences.   

Quantcast's AI-powered TopicMap analyzes billions of URLs daily, providing real-time insights into consumer behavior, interests, and intent. Advertisers can target audiences based on predefined interests or build custom audiences. 

And most importantly? TopicMap unlocks valuable audience insights for accurate campaign planning and activation.

3. Autonomous campaign execution 

AI powers autonomous campaign execution by automating tasks like ad placement, budget allocation, and performance optimization, allowing advertisers to focus on strategy and creativity. 

For example, Quantcast’s AI engine self-learns key factors for effective campaigns, autonomously managing them in a closed-loop fashion to achieve specified goals and KPIs efficiently. This leads to more efficient campaigns and better overall results. 

4. Real-time bidding optimization

AI enhances real-time bidding (RTB) by processing data at lightning speed to make more informed bidding decisions. Digital advertising platforms use AI to adjust bids based on various factors like time of day, user engagement, and ad placement. With improved bidding decisions, advertisers get the best value for their ad spend. 

5. Ad creative optimization

Personalized ad experiences boost engagement and conversion rates. AI-powered tools allow advertisers to test different versions of creative elements like images and headlines. These tools assess performance and customize ads in real time based on the viewer’s behavior, preferences, and context, providing a unique ad experience for each user.

Success stories of AI in programmatic advertising

Here’s how businesses and brands have leveraged AI in programmatic advertising to drive real and measurable results:

American Express

• Challenge: American Express struggled to increase credit card adoption in the Netherlands, where debit cards are far more popular.
• Solution: Their agency, Matterkind, used Quantcast's AI advertising platform and cookieless solution to target potential customers using real-time data for a mix of prospecting and retargeting.
• Result: The campaign saw a 57% improvement in delivery efficiency and a 12% lower cost per acquisition (CPA) than the nearest competitor.

yourtown

• Challenge: yourtown, a renowned nonprofit service provider, needed to build brand awareness and drive lottery ticket sales at scale.
• Solution: GroupM Nexus, using Quantcast’s advertising platform, employed a full-funnel strategy combining brand and performance ads with real-time audience insights.
• Result: The campaign delivered a 39% increase in conversions and achieved a 39x return on ad spend (ROAS).

Standard Chartered Bank & Dentsu

• Challenge: Standard Chartered Bank wanted to attract new digital credit card customers while minimizing costs.
• Solution: Dentsu used Quantcast’s Ara AI engine to target credit card reward seekers with predictive modeling and personalized display ads.
• Result: Quantcast drove 40% of new credit card customers, reducing the cost per acquisition by 68%​

Future trends in AI and programmatic advertising

Curious about what the future holds for AI in programmatic advertising? Here are a few insights: 

• Programmatic audio advertising: AI analyzes real-time listener data to deliver personalized ads in podcasts and music streams. Brands can seamlessly insert relevant ads into audio content, boosting engagement.
• AI-powered attribution models: These models use multi-touch analysis to track consumer interactions across channels. Advertisers gain clearer insights into customer journeys, optimizing budgets for better ROI.
• Blockchain in programmatic advertising: Blockchain improves transparency and security by recording transactions in an immutable ledger. This reduces ad fraud and ensures fair compensation for publishers.

Advance in advertising with an AI-powered platform

AI is rapidly advancing programmatic advertising, delivering more personalized, data-driven solutions across formats. Agencies, publishers, and advertisers looking to stay competitive should embrace these innovations for better targeting, efficiency, and results. 

Quantcast’s demand-side platform (DSP) uses AI and big data to deliver real-time audience measurement and advertising. We offer all the tools and solutions you need to understand your audience better, optimize your advertising strategies, and measure your campaign performance. 

Try Quantcast today for the best of AI-powered programmatic advertising.