Founder of Captain Growth Dmitriy Pleshakov, “Using Machine Learning, We Decide How to Manage the Advertising Budget” Founder of Captain Growth Dmitriy Pleshakov, “Using Machine Learning, We Decide How to Manage the Advertising Budget”

How to optimize advertising using artificial intelligence and what can marketers do in the world where algorithms took over? Founder of Captain Growth Dmitriy Pleshakov covered this issue at the AI Conference Kyiv on June 4.

Dmitriy works at the intersection of technologies and marketing. For the last 5 years, he has been leading data science teams. Two years ago, he founded the AI startup Captain Growth, acquired by Perion in April 2019.

On June 4, the speaker will make a presentation at the AI Conference Kyiv explaining how AI technologies help to optimize advertising in the cross-channel world.

AI to manage audiences, budgets, creatives, and sales

According to Dmitriy, today artificial intelligence allows efficiently promoting brands online. For example, Facebook has tools that independently decide how to manage the advertising budget.

“You tell Facebook how much money you have, for example, $10 thousand, and the network decides how to distribute the money among different audiences, announcements, products. You have created the budget, allowed Facebook to manage it, and the network makes everything on its own. This is standard. You will not be able to make it in any other way starting from this September,” the specialist said.

Facebook’s Lookalike audience tool allows reaching new users that are similar to existing customers of the company and are more likely to get interested in its products and/or services. “The point is that we do not describe our audience to the algorithm. We tell the program that these 100 people have already purchased our product and ask to find similar customers,” the expert noted.

Besides, Dmitriy explained how AI manages advertising creatives, “Instead of creating many different creatives, you develop a constructor. You provide the system with images, video, headline, and other elements, and it independently groups them and decides whom, what, and when to show with the most of efficiency. The system can also define that in the case of two different texts, the first one better suits one person, and the second one better suits the other person,” the expert said.

The speaker mentioned that “the most dramatic” moment was the capability of AI systems to decide which product to sell.

“For example, your online store offers 1,000 products. We tell the system, here are our products, here is our audience, decide what and whom to sell. And the system manages this task pretty well,” the expert said.

In what aspects can marketers outperform algorithms?

According to the speaker, today artificial intelligence fulfills a variety of tasks that previously were in the range of responsibilities of marketers. However, a human has a great advantage in the world where algorithms took over: the ability to use many AI tools.

“In what aspects can we outperform algorithms? In the fact that they do not know anything about one another. Facebook does not know anything about Google and Google about Amazon and vice versa. They do not exchange data. And the strong side of a human is the knowledge of subtleties and capabilities of every AI system. Using this information, you can turn into a marketer-bandmaster that manages the orchestra of different AI systems.

By trusting AI, such specialist does not take a lower position but a higher one, managing all tools, aggregating data from different sources, and using it correctly,” the speaker highlighted.

AI for the optimization of the advertising budget

To learn how Ukrainian specialists optimize advertising budgets using AI, we talked to Dmitriy in person. He told AI Conference Kyiv about services of Perion, tools helping to manage the budget, and fields interested in such tools.

AICK: This spring Рerion bought your AI startup Captain Growth. Tell us more about this company. What services does it provide?

D.P.: Perion is a global company. The services that we provide is software, a SaaS product intended for the optimization of advertising for big brands in any of online channels. It can be Facebook, Google, DSP, Snapchat, Twitter, and other platforms.

The principle of our operation is as follows: you as a brand spend significant amounts of money on online promotion. As a rule, promotion management is rather difficult, as usually, it embraces many channels, each with its own specifics, audiences, and peculiarities. In our turn, we help you to take daily decisions as to how to manage it all correctly.

You give us your budget, for example, $1 million per year or month, and tell us for which channels you want to spend it. We help to distribute the money among channels and properly optimize advertising in each of them by showing ads to the right people, at the right time, and with the right message.

AICK: Tell us about AI solutions you use at the Kyiv-based office of the company.

D.P.: At the Kyiv department of Perion, we deal only with issues of AI and ML. This is our main area of activity. We are doing optimization. Using machine learning, we decide how to manage the advertising budget. We have models that analyze data and define how much money is needed to solve a certain task in the most optimal way.

AICK: What companies do you work with? Please, give us an example of the successful application of AI solutions for the optimization of the advertising budget.

D.P.: We have been working with a great number of companies including several offices of Zara in different countries, various е-commerce brands. For example, we developed a pilot project for the large French online retailer Tammy&Benjamin. Besides, many advertising agencies are our customers.

We have recently rolled out the case with the American Fantom Agency, which promotes IT companies. With our product, they reduced the cost of the lead by 70%.

AICK: What tasks can business representatives solve using your AI developments?

D.P.: The main task is customer acquisition. Most of the companies solve it using advertising, which requires some budget spent in one way or another. We help to spend it in a more optimal way by reducing the cost per action. There is customer acquisition cost. We help to reduce it, to which extent – it depends on the business, its specifics, and other parameters.

AICK: What companies are interested in such AI solutions more than others are? What industries do they cater to?

D.P.: As a rule, e-commerce, as this business is developing online. For such companies, the Internet is the main channel of acquisition.

At the same time, any other business that uses the Internet as a source of customer acquisition can use the benefits of AI. Any company that places ads onFacebook, Google, or Amazon is our client.

AICK: You made a presentation at AI Conference Kyiv. In your opinion, how do AI-themed events influence industry development?

D.P.: Community is formed at such events. The AI Conference Kyiv gathered a business audience. This is good because these people will take something useful from the event, the understanding that today there are definite solutions and products. As a result, the market will catch up.

In general, the Ukrainian AI market is currently in a disappointing state. Over the time of our existence, we had just one or two clients from Ukraine, and the rest of the clients were from the USA and other countries. The reason is that the level of understanding of the technologies is low in our country, and it needs to be developed. Today people do not know that such solutions are useful, available, and affordable, in fact. Therefore, the educational role is important.

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