Has Meta Figured Out How to Monetize AI - By Using It For Targeted Advertising?
Yahoo Finance reports that Mark Zuckerberg made bold predictions for investors on Meta's earnings call this week — about advertisers. "AI has already made us better at targeting and finding the audiences that will be interested in their products than many businesses are themselves," Zuck said, "and that keeps improving..." "If we deliver on this vision, then over the coming years, I think that the increased productivity from AI will make advertising a meaningfully larger share of global GDP than it is today..." If investors are still searching for answers to nagging questions about how massive AI investments will pay off, Zuckerberg provided the clearest reply yet: It will strengthen our core business. In fact, it is our business... On what many believe to be the cusp of an economic downturn, Meta isn't pitching its AI developments as an add-on to its operations, but as something central to its core proposition of targeted advertising... "While Meta's investments in GenAI have spooked certain investors who continue to question the return on these investments, we saw further signs of GenAI monetization in the firm's ad business," wrote Morningstar equity analyst Malik Ahmed Khan in a note on Thursday. In a powerful showing, coming after Alphabet's own impressive results, Meta noted that a new ads recommendation model it's testing for Reels has already boosted conversion rates by 5%. And nearly one-third of advertisers were using AI creative tools in the past quarter. For Zuckerberg, the enhancements AI offers to finding the right consumers and providing measurable results strengthen the case for boosting capacity and for a revamped model of advertising's scope. And with the company set to invest upwards of $70 billion toward its AI opportunity this year, the bet is not all about ads, of course. Zuckerberg outlined four other areas of focus for its AI efforts: business messaging, Meta AI, AI devices, and more engaging experiences. Meta's efforts can also be viewed as an ambitious play to take on its rivals across tech's legacy and emerging platforms. As John Blackledge, senior analyst at TD Cowen, said in a note on Thursday, the AI opportunities Zuckerberg outlined are about "ultimately taking on Google search, iPhone and ChatGPT all at once." In the pre-AI world, "Businesses used to have to generate their own ad creative and define what audiences they wanted to reach," Zuckerberg told Meta's investors this week. And by Friday's closing, Meta's stock had jumped 12.6% over its value Wednesday morning, leading Yahoo Finance to conclude that Wall Street "appears to be buying into" Zuckerberg's vision. Read more of this story at Slashdot.
Yahoo Finance reports that Mark Zuckerberg made bold predictions for investors on Meta's earnings call this week — about advertisers. "AI has already made us better at targeting and finding the audiences that will be interested in their products than many businesses are themselves," Zuck said, "and that keeps improving..."
"If we deliver on this vision, then over the coming years, I think that the increased productivity from AI will make advertising a meaningfully larger share of global GDP than it is today..."
If investors are still searching for answers to nagging questions about how massive AI investments will pay off, Zuckerberg provided the clearest reply yet: It will strengthen our core business. In fact, it is our business... On what many believe to be the cusp of an economic downturn, Meta isn't pitching its AI developments as an add-on to its operations, but as something central to its core proposition of targeted advertising...
"While Meta's investments in GenAI have spooked certain investors who continue to question the return on these investments, we saw further signs of GenAI monetization in the firm's ad business," wrote Morningstar equity analyst Malik Ahmed Khan in a note on Thursday. In a powerful showing, coming after Alphabet's own impressive results, Meta noted that a new ads recommendation model it's testing for Reels has already boosted conversion rates by 5%. And nearly one-third of advertisers were using AI creative tools in the past quarter. For Zuckerberg, the enhancements AI offers to finding the right consumers and providing measurable results strengthen the case for boosting capacity and for a revamped model of advertising's scope.
And with the company set to invest upwards of $70 billion toward its AI opportunity this year, the bet is not all about ads, of course. Zuckerberg outlined four other areas of focus for its AI efforts: business messaging, Meta AI, AI devices, and more engaging experiences. Meta's efforts can also be viewed as an ambitious play to take on its rivals across tech's legacy and emerging platforms. As John Blackledge, senior analyst at TD Cowen, said in a note on Thursday, the AI opportunities Zuckerberg outlined are about "ultimately taking on Google search, iPhone and ChatGPT all at once."
In the pre-AI world, "Businesses used to have to generate their own ad creative and define what audiences they wanted to reach," Zuckerberg told Meta's investors this week.
And by Friday's closing, Meta's stock had jumped 12.6% over its value Wednesday morning, leading Yahoo Finance to conclude that Wall Street "appears to be buying into" Zuckerberg's vision.
Read more of this story at Slashdot.
