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A new study from one of the world’s biggest ad firms, its digital ad agency and a programmatic ad tech company suggests that digital ad campaigns optimized by machine learning tools outperformed campaigns managed by humans over the course of one month.

Expand chart

Data: Magna Global; Chart: Axios Visuals

Why it matters: Although advertising has traditionally been a creative industry, stakeholders — like agencies, ad tech firms, and even brands — are pushing the effectiveness of their automation and machine learning tools, to lure clients that are focused on cost-efficient data-driven ad campaigns.

The study was conducted by:

  • IPG Media Lab, the media advisory arm of Interpublic Group (one of the world's biggest ad holding groups)
  • MAGNA, the investment and innovation unit within IPG Mediabrands
  • and true[X], a programmatic ad tech company.

It suggests that humans and machines need similar exposure to an ad campaign to learn, absorb patterns and predict incomes. Given that same input, the machine-learning programs performed better than humans at optimizing the campaign — basically, putting the most effective ads where they will have the most impact.

  • For example, the average number of ad impressions across all three experiment campaigns that it took to reach a consumer with a human-managed ad campaign was 4.13, while the average number of ad impressions that it took a machine to reach a person was 3.08.
  • Overall, the study found that all three brands achieved higher levels of brand familiarity, brand interest and purchase consideration when their campaigns were optimized by machine learning instead of human campaign managers.

The bigger picture: The integration of automated ad technology (called programmatic advertising) has been proven to improve the outcomes of digital advertising when properly managed by humans, but it will require a new set of skills and jobs to implement.

If machine learning takes over routine tasks — like allocating ad impressions to parts of a website where they will perform better, or swapping an ad's creative elements with more compelling art — humans will only need to step in to solve complex problems and make big decisions.

  • That bodes well for experienced managers, but potentially poorly for people who perform easily automated tasks.
  • The addition of these jobs and resources will likely displace some advertising jobs that are no longer necessary. For example, fewer sales people are needed to perform small-level direct sales jobs that can be done digitally.
"Smart media companies no longer invest as heavily in digital media web site sales because the return is now lower .... Instead they hire programmatic to optimize their sites for machines who want to buy. This in theory frees sellers up to sell "experiences." So yes — web sites are barely mid-funnel marketing tools. They are “bottom funnel,” mostly. 
— Ryan McConville, President & COO, Kargo, a mobile advertising company

Yes, but: Almost every new ad tech firm, marketing agency and tech company is touting awesome machine learning products, but right now none of them performs wildly better than the human-built systems we have today.

Bottom line: Advertising and marketing jobs are increasingly becoming more automated, but it will take time and experimentation to best understand what the balance should be between automation and human engagement.

Go deeper: How media companies lost the advertising game

Go deeper

Updated 5 hours ago - Politics & Policy

Omicron dashboard

Illustration: Brendan Lynch/Axios

  1. Health: Pfizer and Moderna boosters overwhelmingly prevent Omicron hospitalizations, CDC finds — Omicron pushes COVID deaths toward 2,000 per day — The pandemic-proof health care giant.
  2. Vaccines: The case for Operation Warp Speed 2.0 — Starbucks drops worker vaccine or test requirement after SCOTUS ruling — Kids' COVID vaccination rates are particularly low in rural America.
  3. Politics: Biden concedes U.S. should have done more testing — Arizona says it "will not be intimidated" by Biden on anti-mask school policies — Federal judge blocks Biden's vaccine mandate for federal workers.
  4. World: American Airlines flight to London forced to turn around over mask dispute — WHO: COVID health emergency could end this year — Greece imposes vaccine mandate for people 60 and older — Austria approves COVID vaccine mandate for adults.
  5. Variant tracker

Arizona governor sues Biden administration over COVID funds tied to mandates

A teacher prepares a hallway barrier to help students maintain social distancing at John B. Wright Elementary School in Tucson, Arizona, on Aug. 14, 2020. Photo: Cheney Orr/Bloomberg via Getty Images

Arizona Gov. Doug Ducey (R) filed a lawsuit Friday against the Biden administration for ordering the state to stop allocating federal COVID relief funds to schools that don't comply with public health recommendations such as masking, the Arizona Republic reports.

Why it matters: The Treasury Department said last week that the state would have to pay back the money if Ducey does not redesignate the $173 million programs to ensure they don't "undermine efforts to stop the spread of COVID-19."

Federal judge blocks Biden's vaccine mandate for federal workers

President Biden speaking from Eisenhower Executive Office Building on Jan. 21. Photo: Yuri Gripas/Abaca/Bloomberg via Getty Images

A federal judge in Texas blocked the Biden administration from enforcing its coronavirus vaccine mandate for federal workers on Friday, citing the outcome of last week's Supreme Court ruling that nullified the administration's vaccine-or-test requirement for large employers.

Why it matters: It's a blow to President Biden's efforts to increase the U.S.' vaccination rates, though much of the federal workforce has already been vaccinated against the virus.