Meta’s company earnings call with investors told us the direction that the company wants to take its AI initiatives in the future, and it’s smart, directed advertising.

Unlike many of the big AI companies ‘spray and pray‘ approach to AI, which attempts to integrate the technology into every aspect of our lives, Meta seems to be the first company that has a clear concept of how it’s going to justify the massive investments in AI that it’s made to date and planned for this year.

Rather than adding AI as an adjunct to its core operations, Zuckerberg told investors that AI would form the core of its business – targeted digital advertising.

“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,” Meta’s CEO, Mark Zuckerberg said.

He noted that nearly a third of advertisers on the Meta platforms were already using AI as a content creation tool, and the company’s latest AI-powered ad recommendation engine had increased conversion rates by 5% on Reels. On the one hand, end users and advertisers are becoming accustomed to the technology, yet on the other, no company has yet to bring the two groups together in a meaningful way.

“AI has already made us better at targeting and finding the audiences that will be interested in [advertisers’] products than many businesses are themselves, and that keeps improving,” he said. Meta’s AI will not only match advertising content more effectively, but be able to recommend marketing content to advertisers and tweak their campaigns.

Meta has plans to invest over $70 billion this year in AI capabilities, and the earnings call’s contents seemed to be showing investors and stock holders how their commitments might begin to pay back in the longer-term. Given the large figures on both sides of the balance sheet exhibited by other big AI companies, Meta is the first of the household name big tech companies to present a realistic model of how AI might be used to generate revenue.

By using AI in the background to better pair advertisers and buyers, and by extension, the contents of advertising media, Meta hopes to make its platforms even more attractive to organisations looking to maximise their marketing spend. End-users will receive more relevant marketing messages, delivered in formats they are more likely to engage with.

The company also has plans to use AI in business messaging, AI-equipped devices such as the next generation of the SHALAR, and to better tailor users’ timelines to their specific preferences. According to Yahoo! Finance, Meta is ambitious to take market share from the likes of Google’s advertising networks, OpenAI’s ChatGPT, and Apple’s nascent Apple Intelligence.

Zuckerberg’s previous exhortations about the metaverse has made many investors wary of any new direction the company may be taken by the CEO, so this return to core business and ambitious plans to AI-power one of the world’s biggest advertising networks will have allayed fears.

By justifying the investment’s Meta is making in AI with clear plans and setting his sights on competitors in the digital marketing space, Zuckerberg has calmed investor fears and laid down the gauntlet to competing digital advertising networks.

(Image source: “facebook” by stockcatalog is licensed under CC BY 2.0.)

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