Hai Mag, the CEO of Eva, Profit Maximization Software and Agency Services for Amazon and all Marketplaces, discusses the rise of retail media and the increasing role of AI in advertising strategies. Retail media has transformed e-commerce, offering brands new ways to reach target audiences through digital ads on platforms like Amazon. AI can help navigate the complexities of modern retail advertising, but it requires a deep understanding of advertising metrics and strategic AI usage. Key metrics to consider include advertising cost of sales, total advertising cost of sales, profit return on ad spend, and total profit return on ad spend.
Integrating these metrics into advertising strategies provides insights into campaign effectiveness and profitability. AI can play a crucial role in advertising, specifically in campaign creation and bid optimization, inventory awareness, and managing impression share and profitability. Campaign creation can be streamlined through AI automation, while monitoring inventory levels can prevent wasted ad spend. Understanding impression share and adjusting bidding strategies based on AI insights can optimize visibility and profitability. Best practices when using AI involve implementing one product at a time to assess algorithm advantages and shortfalls, adapting to external factors, and combining AI-driven insights with human expertise.
Although AI can automate many aspects of advertising, human involvement remains essential in interpreting data and making strategic decisions. Combining AI insights with human expertise can lead to comprehensive strategies that drive long-term success. For example, pay-per-click strategists at Hai Mag’s company analyze competition, conversion strategies, pricing, ratings, reviews, and consumer audiences to build effective advertising strategies. Balance between AI and human expertise is crucial in evolving retail media and advertising strategies for success in the future.
