Hero or villain: how AI is transforming paid media

Artificial intelligence is transforming paid media, reshaping the entire landscape of digital marketing. However, the big question that remains is whether AI is a powerful ally, offering unmatched precision and measurable results, or a potential risk that brings new challenges. 

Today, we’ll dive into how this technology is shaping the future of paid media, looking at its benefits, the hurdles it presents, and real-world examples that showcase both its successes and failures.

The dual nature of AI in paid media

In recent years, artificial intelligence has moved from being an emerging trend to a key player in high-level digital marketing. 

Stanford University’s AI Index 2024 report highlights the growing use of AI in marketing and media, with increasingly sophisticated models improving the targeting and personalization of ad campaigns. 

McKinsey’s report also shows that 65% of companies are now regularly using generative AI—double the number from the previous year—demonstrating the rapid adoption and growing dependence on this technology to power marketing strategies.

Is this a ‘healthy dependence’?

It depends. Artificial Intelligence can be a powerful tool to spark creativity and find quicker solutions, giving you more time to develop deeper strategies and build solid tactics.

However, some people rely too heavily on this technology, making their work seem robotic and lacking authenticity. That’s why we’re here to show you how to use AI as an ally, not as a catch-all solution.

AI is a hero when it comes to customization

Personalization and targeting are among the biggest competitive advantages AI brings to paid media. Tools like Google Ads and Meta Ads leverage AI to analyze vast amounts of data, allowing for highly precise audience segmentation. 

According to a Gartner report, companies using AI for personalization see up to a 30% increase in conversion rates compared to traditional strategies. By understanding consumer interests and behaviors, AI ensures that relevant content is delivered at the right moment, maximizing campaign impact while reducing costs.

Optimizing resources

AI also allows for real-time optimization of bids and spending strategies, continuously adjusting campaigns based on their performance. This means campaigns can be fine-tuned on the go to maximize return on investment (ROI), with companies reporting revenue increases of over 5% in a short amount of time.

Predicting scenarios

Another area where AI shines is predictive analytics. By forecasting behaviors, trends, and future outcomes, marketers can make more informed decisions and fine-tune their strategies. In fact, using AI for predictive analytics in advertising campaigns has boosted customer engagement by 22%, according to a Forrester survey.

Automating content creation

AI goes beyond just analyzing data; it can also generate content automatically. From visual banners and videos to entire campaigns, AI can create marketing materials with minimal to no human intervention. This not only saves time and resources but also frees up marketing teams to focus on more strategic tasks.

AI as a villain: challenges and risks

Privacy concerns

That said, AI in paid media comes with its own set of challenges. One of the biggest concerns is user privacy. The massive collection and analysis of data bring up serious questions about security and how personal information is stored and used.

Unemployment

Another risk to consider is the potential impact on jobs. As AI automates tasks like media planning and content creation, there’s growing concern that it could replace human professionals in many areas of marketing. A 2024 study by the World Economic Forum estimates that 12 million marketing jobs could be lost to automation by 2030, raising concerns about the future of work in a field traditionally driven by creativity.

Bias in AI algorithms

AI algorithms, if not carefully monitored and adjusted, can unintentionally perpetuate or even amplify existing societal biases. This is especially troubling in advertising, where AI might unknowingly target or exclude certain demographic groups, leading to discriminatory practices. 

A report from Stanford University revealed that 40% of the algorithms studied showed some form of bias, potentially harming campaigns and brand reputations. After all, generative AI is always learning and can be shaped for better or worse.

Overreliance on automation

Last but not least, relying too heavily on automation can stifle creativity and strategic oversight. No matter how advanced AI gets, it still can’t replicate the intuition, innovation, and critical thinking that humans bring to the table. This can lead to campaigns that feel generic and lack originality, falling into the trap of being “just more of the same.”

AI and Paid Media in real life

A success case

There are numerous examples of AI in campaigns, highlighting both its strengths and weaknesses. 

One standout success was Coca-Cola’s 2023 paid media campaign, which used AI to personalize video ads in real time for millions of users. The results were impressive, with a 35% increase in engagement rates and a 20% reduction in acquisition costs, showcasing the powerful impact of AI when used effectively.

AI can also make mistakes, since it was created by humans

On the flip side, a report by the Digital Marketing Institute highlights how a major fashion brand faced backlash in 2024 when its AI-driven campaign unintentionally excluded a segment of consumers due to algorithmic bias. Not only did the campaign fall short of its goals, but it also sparked a public debate about the ethics of using AI in advertising.

Finding the balance: how to navigate AI in Paid Media

Best practices for marketers

To fully harness AI in paid media, marketers should take a balanced approach, blending human creativity with AI’s analytical power to craft innovative and effective campaigns. Equally important is the need to establish ethical guidelines to ensure that campaigns remain fair and inclusive.

Human-AI collaboration

The collaboration between humans and AI should be seen as a true partnership. While AI excels at data analysis and automation, handling complex tasks quickly, humans bring strategic oversight and creative innovation to the table. Together, this blend leverages the efficiency of AI and the critical thinking of humans, offering the best of both worlds for producing optimal results.

The future of AI in Paid Media

The future of AI in paid media holds great promise but also brings significant challenges. As technology evolves, marketers must stay ahead of new tools and techniques while keeping a close eye on ethical concerns and social implications. 

According to the same 2024 Gartner survey, 78% of CMOs believe AI will be essential to their marketing strategies in the next five years, though 60% acknowledge the need for a balanced approach to avoid potential pitfalls.

AI has the potential to be both a hero and a villain—not just in paid media, but throughout the digital ecosystem. The key lies in knowing how to use it. While AI can revolutionize campaign effectiveness, it also introduces risks that must not be overlooked. Future success will hinge on how companies strike a balance, using AI responsibly and strategically to create campaigns that are not only effective but also ethical and sustainable.