What does the future of online advertising look like? The answer: Ads that you can talk to.
You’ve been looking to travel in August and you see an ad for a hotel in the Caribbean that intrigues you. But you have a few questions: Is there a pool? How much for a room? Is it close to the beach? The ads of the future will answer all of your questions, in seconds. Using artificial intelligence, ads won’t just display information, they will be a conversation.
IBM is leading the pack in artificial intelligence for advertising and on June 2nd announced Watson Ads. The ads will run for the Weather Company and they will be powered by IBM’s Watson, which has defeated human jeopardy champions. Watson Ads will enable consumers to converse with ads either via typed-text or voice.
If Watson Ads works as intended, it could transform online advertising and help increase publishers’ revenues, but the question publishers and advertisers need to be asking is: will it be enough to defeat ad blocking?
What is ad blocking and why does it matter?
Ad blocking allows users to remove ads from websites using a variety of tools. With over 1 in 5 people using ad blockers on their smartphones, ad blocking has become a significant issue for both advertisers and publishers. In fact, a recent report projected that $41.4 billion in global revenues will be lost due to ad blocking by the end of 2016.
Is IBM’s Watson the answer?
In many ways, yes. Watson Ads is working towards a future of ad personalization and far more interaction between ad and user. The goal is to improve the user experience by better targeting consumers and making sure they are more well-informed about products.
Watson uses Big Data to understand consumers as well as collects data during interactions to provide the most relevant ads possible. Most importantly, Watson is designed to learn human behavior and language from users including vocabulary and even slang. The idea is to create an experience of human interaction between brands and consumers on a very large scale.
Does it really work? IBM only recently introduced Watson Ads so only time will tell. But if anyone is going to succeed at artificial intelligence, it will likely be IBM’s Watson.
Today’s answer to ad blocking: smarter ads
IBM’s Watson is only one answer to ad blocking, but it’s not the whole story. Across the industry, publishers and advertisers will need to focus on quality, not quantity. With ad blocking increasing each year, publishers that use ad products that leverage Big Data and semantic contextual analysis will be the ones that succeed in the long term.
The publishers that prosper will be those that present the most relevant and engaging ads on their sites, not the ones that clutter their sites with the most ads. Users have decreasing patience for sites that offer a subpar user experience due to ad clutter. Publishers that don’t adapt to the new realities of online advertising will only find lower site traffic and decreasing revenues.
However, publishers that get it right by using the most innovative monetization strategies such as in-image ads, content recommendation, and Watson Ads will not only find increased site traffic, but will see increased ad revenues.
The future of advertising?
Online advertising has completely transformed in recent years and is continuing to at an even faster pace than any time in its history. Here are a few of my predictions for the coming years:
- As ad blocking becomes more and more widespread in the coming years, publishers and advertisers will need to adapt by using the smartest advertising products on the market. In-image ads, content recommendation, and Watson Ads won’t just be an option in the future, they will become a necessity.
- It will be a long while before Watson Ads operates as it is supposed to, but within the next few years, it will completely transform the online advertising industry.
- Personalization and relevant advertising will be the only way to reach consumers in the future. If ads don’t engage users and provide an interactive, personal experience they will be ignored.
- Today, users aren’t asking for a great user experience, they are demanding it. Publishers that clutter their sites with too many ads will see lower traffic and decreased revenues. Users are only getting smarter and publishers will need to keep up.