By Marty Swant • August 2, 2024 •
Ivy Liu
Despite warnings of an impending AI downturn, companies have been ramping up advertising to help market various AI products and services.
Companies spent more than $107 million on ads marketing AI-related products and services in the first half of 2024, more than 19 times the $5.6 million total spent in the same period last year. The findings, based on data provided by MediaRadar, also show the total number of companies buying ads to market AI products increased from 186 in 2023 to 575 so far in 2024. Nearly half of total ad spend came from just three companies with various AI products — IBM, Microsoft, and GoDaddy — which accounted for $52 million, or 48% of total spend through June 2024. Of the rest, just 45 other companies spent more than $100,00 each. (MediaRadar didn’t provide a full list of every company spending on AI-related ads.)
According to MediaRadar, TV advertising accounted for 54% of all AI-related ad spend. Online video advertising passed $15 million, making up 14% of total ad spend, while digital display ads captured 13% at over $14 million. Paid social advertising exceeded $13 million, accounting for 12%, with a concentration on ad buys via X (Twitter). The remaining 7% was a mix of print, native, OTT, and mobile advertising.
Through this year, Digiday has found other examples of tech companies pitching AI in paid media include tech giants — including Adobe, Salesforce, Qualcomm and Apple — as well as various AI startups and mobile apps. Some have fun on out-of-home ads on taxis and billboards with others running across social media and streaming platforms.
Tech giants are also marketing AI products and services rather heavily during the Summer Olympics. Advertisers with AI-related messaging in paid media or sponsorship deals include major brands like Microsoft, Google, Intel and Alibaba.
During the Olympics opening ceremony, Microsoft aired a new commercial for Copilot, the company’s flagship AI platform. The new ad follows a different commercial that debuted during in February during the Super Bowl. This one, titled “They Say,” shows athletes — including an elderly runner, a young boxer and a pregnant weightlifter — using Copilot in their daily lives as it aims to portray AI as a tool that enhances human performance for Olympians and non-Olympians alike.
Panay Films, a production company and creative agency, made both Microsoft ads. According to CEO Andrew Panay, the goal is to make AI more relatable and explain how products like Copilot can help people “get an edge on your life, even 1%.” The new campaign is integrated across Microsoft’s apps and products, with different versions of the main ad running during the Olympics.
“Part of watching the Olympics is you feeling empowered to go out and get inspired in your own life,” said Panay. “The Olympics have so many different sports and there’s something that you’re going to connect to. Maybe you’re not a basketball fan, maybe you’re not a track and field fan, but you’re going to be a fan most likely of something.”
Not all ads are landing in the same way. Google’s commercial, “Dear Sydney,” uses Google Gemini — the company’s Copilot rival — to help a young fan use AI research and write a letter to U.S. Olympic track star Sydney McLaughlin-Levrone. However the ad has been criticized for relying on AI to downplay creativity. When asked for comment about the ad, a Google spokesperson told Digiday that the company believes AI “can be a great tool for enhancing human creativity, but can never replace it.
Along with its new commercial, Google also is the “Official Search AI Partner” of Team USA. The partnership, in collaboration with NBCUniversal, includes using Google’s AI features to enhance NBCUniversal’s coverage of the Paris Olympic and Paralympic Games. Other aspects include ways to explore athlete stories and competitions through Google Search and integrations with other Google apps like Maps, Gemini, and Google Lens and Circle to Search.
Other tech companies have also found ways to integrate their AI in the games. Intel, the “Official AI Platform Partner” for Paris 2024, is using AI to give fans personalized insights while also helping broadcasters use AI to generate real-time highlights and enable 8K livestreams.
Another is Alibaba. With a free “Wonder Avenue” experience in Paris, the e-commerce giant is showing attendees its intelligent shopping assistant — powered by the company’s Qwen language model — for attendees to create personalized avatars, as well as to create photo and video content.
Eric Haggstrom, vp of business intelligence at Advertiser Perceptions wondered whether companies are spending more on advertising overall or if they’re just shifting budgets to new products. Tech companies overall significantly reduced their ad spending in 2023, Haggstrom said, which makes this year’s increases appear more dramatic. But with ad spending often tied to product launches, he expects so many AI products arriving on the market could lead to a significant increase.
Every few years, a new category emerges and spends heavily, according to Haggstrom. However, will AI ad spending be like crypto and rise fast and before a big drop? Or will it be more like sports betting, which has enjoyed sustained momentum as companies found their footing with new applications and audiences?
“A lot of the companies who are involved in these AI products were already some of the world’s largest advertisers,” Haggstrom said. “You think Google, you think Microsoft, Meta… is this truly incremental to the market, or is this just reallocation from other advertising products? Is Google’s budget coming from their consumer products, their hardware services, or is it net new promoting Gemini?”
https://digiday.com/?p=551535
