MARCO ISLAND, FL — In the AI age, the adage “Garbage In, Garbage Out” may never have been more true. Given that machine learning and large language models rely on training data sets, the provenance of those inputs is critical.

Those in advertising hoping to harness the technology should take note.

In this video interview with Beet.TV at the IAB’s Annual Leadership Meeting, David Simon, GM, Growth Initiatives, Moloco, says data quality is critical.

Quality Over Quantity: The AI Data Mantra

“There’s so much noise about AI and machine learning,” Simon explains. The conversation around these technologies has been more about their presence rather than their impact, he says. “If you really want to think about the value that AI brings, you have to recreate how you use it and how we think about media buying,” Simon asserts.

“AI thrives on good data,” Simon continues, emphasizing the type of data that truly matters—signals that indicate success. For brands, marketers, or publishers, understanding the audience is crucial.

“What is it that you know about your audience, whether it comes to how they consume content and the yield against that content, or if you’re trying to sell products?” This knowledge is pivotal because “when you can capture those data points and feed them to an ML platform, that’s where the real value creation can happen.”

The Shift from Proxies to LTV

The advice to customers is clear: focus less on known segments and more on the raw inputs that equate to customer lifetime value (LTV).

“It’s a new data infrastructure, it’s a new way of engaging with customers,” according to Simon.

He cites examples of this approach in action. “When a customer goes from proxy metrics, like a quote for insurance, and instead starts feeding the models, the actual LTV that’s spit out by an actuarial table, that information drives significantly better return on ad spend for the brands when they buy.”

Moloco is a technology company that specializes in programmatic advertising solutions utilizing machine learning. It provides services aimed at helping businesses optimize their advertising campaigns in real-time across various digital platforms.

Its products focus on improving key performance metrics such as customer acquisition cost, lifetime value, and return on advertising spend.

You’re watching ‘Digital Media in Transition’, a Beet.TV Leadership Series at IAB ALM 2024 presented by Sharethrough. For more videos from this series, please visit this page.