As retail sales moves from physical to digital, the need of digital marketing has increased and adaption to new technical possibilities.
Today marketers normally focus 80% of their budgets on 20% of their products (flagship models) both for Brand awareness and performance marketing activities. And like a waterfall let the results spill-over to the rest of the product portfolio.
This has been a great method to maximize results until now. But new AI-tools means marketing departments need to update their methods to utilize their budgets more efficiently within performance marketing, as for performance marketing, the 80/20-rule is not the most efficient method anymore.
Instead, there is significant more profit by letting the AI-systems of the major ad-platforms decide the optimal budget utilization, by giving them as much data as possible at every given moment, i.e. target all products, all relevant consumers and under longer periods.
We have concluded that using Facebook’s AI logic for ad-spend distribution over a catalog of products, is 30-40% more efficient than traditional cherry-picking of products.