Amazon intends to reinvent the holiday season with a secret weapon, generative AI, to offer discounts and optimize same-day delivery, all sprinkled with targeted advertising.
The giant Amazon has planned a bold strategy centered on generative artificial intelligence, to reign over the end-of-year holidays. With more than 160 million Prime subscribers, Amazon does not hesitate to use their data to improve advertising targeting and stimulate sales during the winter season. Let’s see how Amazon is exploring generative AI to increasingly position itself as the number 1 player in online sales.
Targeted ads and generative AI strengthen the Amazon marketplace
In addition to traditional Black Friday and Cyber Monday discounts, Amazon is banking on targeted AI-powered ads to attract both buyers and advertisers to its marketplace. Amazon CEO Andy Jassy points out that machine learning improves the relevance of ads shown to shoppers, providing a significant competitive advantage, in the online advertising industry.
Amazon announced in recent days that it is using generative AI to create more attractive product images, which advertisers can then reuse. The technology generates background images based on product characteristics, an innovation that could revolutionize online advertising. Although Amazon is not the first to do this, its aura should accelerate the adoption of this approach by other players in the sector.
The major advantage of generative AI lies, from Amazon’s point of view, in its ability to create personalized advertisements based on each user, further strengthening the personalization and the link between the customer and the platform. Creating separate ads is usually very expensive for advertisers. They could thus make considerable savings and invest more.
A hard blow for small advertising agencies and freelancers specializing in graphic design?
Analysts believe that Amazon’s generative advertising tool will be beneficial in attracting and retaining a segment of third-party sellers and brands advertising on Amazon. The potential benefits are already being demonstrated by other companies using AI generative imaging tools, who claim to have seen significant increases in sales and click-through rates.
But if this strategy should benefit Amazon and advertisers, the American firm’s AI could threaten small advertising agencies and freelancers who work in graphic design on a daily basis. Not to mention the fact that producing ads with similar images for different products could make it difficult to differentiate brands, which would then require a truly creative marketing strategy.
So yes, generative AI is emerging as an essential asset to attract more buyers, advertisers and sellers to the marketplace. But also to improve the entire delivery process, during a period that promises to be tense, particularly with last minute purchases. This approach also reflects the growing importance of artificial intelligence in online commerce, as the end-of-year holidays loom.
Source : Reuters
11