Could AI technology replace ad agencies?

Three months ago, Italian lingerie brand Cosabella, a 35-year old family-owned company, did something unconventional for an SME in the Italian fashion industry. It set aside its relationship with traditional advertising and marketing agencies to let an artificial intelligence company do the job. The brand says the move has paid off and brought it a huge return on its investment with a 155% increase in sales.

The company contracted two AI partners: Albert, which specializes in cross-channel campaign execution, and Sentient, which focuses on website content optimization.

Since making this jump, Cosabella has seen astounding success, achieving a return-on-ad spend of 336% and a 155% increase in revenue in Q4 of 2016. The lingerie company has also seen its email subscriber list double since pairing with Albert.

Guido Campello, Cosabella's CEO told the press in a statement, “After working with Albert and our other AI partners, I would never hire a human to manage the technical aspects of our ad campaigns ever again. We’ll leave the tech stuff to the tech and hire humans for the high-level strategic and creative.”

Albert autonomously executes multi-channel campaigns from start to finish for the lingerie brand. It also controls all media bidding and buying for Cosabella. The AI platform relies on direct-marketing tactics, targeting potential customers via email, mobile, search, and display.

The 'Albert' platform helps brands by identifying which consumers spend the most time on the site and specifically targets them through calls-to-actions and direct marketing tactics. Albert is also able to identify customers who only spent a few seconds on the website, noting that these customers are not interested in the products and not to continue marketing efforts.

Another of Albert’s benefits is its high rate of accuracy when it comes to success measurement. Albert can track every customer’s online trail – whether they made a purchase after clicking on a Facebook ad or if they made the purchase after receiving an email.

Another early adapter of AI tech, Harley Davidson, has also found success by ditching traditional advertising agencies and working with Albert. Asaf Jacobi, president of Harley-Davidson told the press in October that while the motorcycle company was very successful at reaching their target consumer, their target consumer was only 2% of shoppers. Albert has helped the company quickly identify possible target consumers in the remaining 98% of shoppers, based on the behavioral and purchasing patterns of its current highest-value customers. Since launching its partnership with Albert, Harley-Davidson has found a 566% increase in website visits, 40% of current sales have been credited to Albert.

B2C marketing platform Emarsys, which boasts clients like Nike, L’Oreal, and Luisa Via Roma, launched its own AI initiative in December. While its offerings aren’t as autonomous as those of Albert, Emarsys' new AI layer offers clients product recommendation services catered to each customer's browsing history. The AI layer can also determine the appropriate incentive for target consumers, such as discounts or other promotional deals, as well as recommend the most successful way of reaching potential customers.

Could AI technology replace ad agencies?

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