Meta, Google and Snap are preparing for generative AI, as the technology has caught on with consumers through products like ChatGPT, and they see it as a powerful tool in advertising and creator economies.
Last week, Snap CEO Evan Spiegel discussed the potential for generative AI to power the app’s augmented reality features. Meanwhile, Meta CEO Mark Zuckerberg talked about generative AI in similar terms, to generate “images and videos and avatars and 3D assets, and all kinds of different stuff.” And Google CEO Sundar Pichai said that the company was “extremely well positioned as AI reaches an inflection point.”
The CEOs touched on generative AI in their fourth-quarter earnings calls. The tech brands all reported dips in advertising demand, which affected their revenue outlooks. Google’s Search and YouTube businesses reported year-over-year ad sales declines of 2% and 8%, respectively. Meta’s ad business was down 4% year over year, and Snap’s revenue was flat year over year.
The tech companies are dealing with a downturn in digital ad markets. They are grappling with changes to how data is shared across apps and devices under new privacy restrictions online. AI and machine learning are among the tools that could fix ad targeting. AI is useful in developing models that plan marketing campaigns and measure ad performance. Generative AI, though, is a creative catalyst—a technology that conjures text, images, videos and digital renderings in seconds. It’s also a nascent and unknown technology that could be used for deepfakes and lead to unforeseen consequences in culture.
Related: A marketing guide to generative AI
Generative AI has caught on among consumers, too. Last year, OpenAI shot to popularity with DALL-E and ChatGPT. DALL-E translates text prompts into images, and ChatGPT writes fast responses to complex queries, like a more dynamic search engine. Google and Meta have already been working for years on similar technology, but they have not quite entered the consumer conversation. Google, for one, sees a threat to its search dominance after Microsoft invested $10 billion into OpenAI and started to incorporate the AI into its consumer products, like Teams and Bing.
Here is how Meta, Google and Snap are answering:
Meta’s AI advertising plans
Meta is “working on things that could really empower creators to be way more productive and creative across the apps and run a lot of different accounts,” Zuckerberg said. Now, Meta is looking at generative AI as a long-term goal, like its metaverse ambitions. But the technology is already seeping into ad products, as marketers rely on machines to slightly adjust ad creative and copy.
“We’re using it in creative, we’re using it in targeting,” said Marne Levine, Meta’s chief business officer, in a recent phone interview. “We’re making it easier for advertisers to test.”