AI and the evolution of the digital industry in 2023

As businesses try to adapt to the rapidly changing geopolitical and economic environment, 2023 will see significant shifts in the digital landscape. With a view to prioritising efficiency, sophisticated new technologies will be increasingly sought after, particularly AI. 

It’s clear how far AI has already come since the term was first coined back in the 1950s. And as a result, it now features within many of the devices and digital platforms used today. But there’s still much more that can be done. With that in mind, here are my top four predictions of how AI will continue to revolutionise the digital industry in 2023.

1. Technological Innovation

Thanks to the looming threat of recession and ongoing geopolitical strife, it is likely that IT spending will remain static for 2023, not increasing until 2025. However, rather than spelling a slow down of technological innovation, next year will see existing technologies converge and become “mainstream” in the digital industry. Robotics, VR, AI, IoT and 5G, for example, will all become more widely integrated, delivering richer online experiences to consumers and faster, more agile solutions for businesses at a cheaper cost.

AI in particular will become commonplace. Thanks to the growth of cloud computing capabilities, coupled with increasing availability of powerful, open source libraries like PyTorch or TensorFlow, these resources have brought AI within reach of any organisation willing to invest in it as a marketing or business strategy.

For digital marketers, AI offers significant benefits for ad campaign optimization and design, and the industry will likely experience significant uptake of the technology in 2023. Some brands will take this in-house. Others will leverage third party, AI-led platforms. A knock-on effect of this will be that traditional, creative, network agencies will struggle to achieve historic levels of profit growth, as digital campaign delivery becomes more heavily commoditized and automated through these more agile solutions.

2. Privacy legislation

With the value of both cookies and cross device-IDs diminishing, and privacy legislation particularly in the US forcing a pace, more and more tech companies and brands will be seeking to generate and control their customer data. This will lead to some consolidation in traditional ad tech providers as well as the launch of new, very agile players that address specific audiences, interests or devices.

These new entrants will steadily circumvent the “walled gardens’’” wholesale use of behavioral data by generating, owning and monetizing it inside their own environments. This will increase the need to manage this data in house in a continuous cycle, for which AI will be invaluable. 

3. New channels

CTV will become increasingly popular for marketers as streaming platforms develop content and continue to direct consumer engagement. The Metaverse meanwhile will see some commercial success, in areas such as gaming, retail and healthcare, as VR hardware costs begin to drop and the technology becomes more accessible. Gaming more broadly will see the level of in-game purchases increase and so too the amount of in-game advertising and targeting. 

Nevertheless, these channels will still be regarded as auxiliary components of wider marketing strategies, for which mobile will remain dominant as the preferred device for advertisers. Moreover, as these devices become increasingly capable with 5G connectivity and improvements to battery life and resolution, this will further cement mobile as the primary marketing channel. AI will be key here, for marketers in deterministically managing the balance between engagement and relevance, and privacy and intrusion on user devices.

4. Energy

With the growing visibility of digital’s high energy consumption, the demand for companies to demonstrate carbon neutral solutions, or better, will grow louder in 2023. The energy crisis is compounding this, and has already led to big changes in the digital landscape. For example, the energy fees associated with mining Bitcoin have contributed to the cryptocurrency’s sharp decline in value, and enabled the rise of more sustainable, Ethereum-based applications. 

Technology will assist many businesses in achieving their sustainability goals, from the digital industry to society more broadly. AI will once again be particularly useful here; whether it be in reducing ad wastage to the integration of smart devices in housing developments.

Thanks to its wide range of applications, there is little doubt that AI will dominate the digital sector in 2023. With the pace of technological integration unlikely to be impeded by macroeconomic obstacles, the majority will be looking to AI to future-proof their businesses through this turbulent time. Mobile marketers will be particularly empowered by AI and, as the walled gardens contend with ongoing privacy regulation, more nimble players will use these technologies to give themselves greater access to market share.