How Criteo Uses AI for Retail and the Customer Journey

Criteo is a global commerce media platform with one of the largest retail media footprints (200 retailers worldwide, including half of the top-25 in the U.S. and 2,300+ brands). Criteo’s retail media business activates around $1 billion in media spend. Criteo partners with major retailers like Best Buy, Macy’s, Dollar General, travel companies, automotive brands, consumer goods manufacturers and financial institutions. Romain Lerallut, VP of Engineering at Criteo, sat down with StreetFight to discuss the governance and investments that will be necessary for ad-tech and AI to truly converge, which can ultimately reshape the customer journey.

What’s the best application of AI for multi-locational, hyperlocal marketing?

For a marketing strategy that targets multiple locations, AI helps by using location-based data and personalized content to reach local audiences. It analyzes data to create tailored marketing campaigns for each area. For franchise businesses, AI improves ad targeting by making sure promotions and content are relevant to each local market, which boosts customer engagement and increases foot traffic. This technology also automates real-time adjustments and optimizes campaign performance, allowing marketers to focus on strategic planning and creative development that can be used to support additional marketing initiatives. AI should help marketers to bridge the gap between consumers and brands, ensuring that all parties benefit from more effective and growth-oriented hyperlocal campaigns.

What is preventing ad-tech and AI from truly converging, if anything, and why?

The convergence of ad-tech and AI has been challenging due to the complexity of combining AI models with already existing ad-tech systems. Data privacy regulations add an additional layer of issues as the industry struggles to navigate ever-changing policies. While AI can significantly improve ad targeting and personalization, the industry must adapt to various privacy laws and the uncertainty around opt-in for third-party cookies, which complicates data collection. Ad-tech companies need to invest in technology and expertise to ensure seamless AI integration with legacy systems, while also developing privacy-compliant solutions to overcome these barriers.

What kinds of governance and investments are needed and from whom?

Effective governance and investment in AI require approaches involving both public and private sectors. This means working with top universities and research institutions and regularly updating AI models to stay current. The focus should be on building up AI systems, improving data privacy and security, encouraging innovation and following regulations. AI being a fast-paced domain, those regulations need to be written with flexibility and effectiveness in mind, in order to balance protection and innovation.

Will the spending on AI-related products increase in 2025 and beyond?

Yes, spending on AI-related products is expected to increase significantly in 2025 and beyond. As AI technologies continue to advance and integrate into different sectors, the demand for AI-driven solutions is assumed to grow. Companies are investing heavily in AI to improve efficiency and tailor customer experiences, and AI is becoming a key part of staying competitive and advancing technology.

It’s said that most agencies and other entities use AI for data analysis and research and less for content creation. Do you see that changing? Why or why not?

It’s hard to say for certain, but with a growing focus on content creation as of recent years, the trend of using AI primarily for data analysis and research could change. As AI advances, it can become more capable of creating high-quality content. The efficiency and scalability offered by AI in producing content makes it an attractive tool for meeting the changing demands of digital marketing.

What’s your opinion on the agency world’s resistance to AI-generated commercials and other forms of advertisement? Is it an overreaction or do they have a point?

Resistance to AI-generated ads stems from valid concerns over whether AI can really match creativity. However, AI has come a long way and can now produce some impressive ads. It’s not about replacing creativity but using AI to support and enhance it. Agencies can explore potential opportunities to reevaluate how AI fits into their creative processes, and the actual customer journey, to help them deliver more personalized and effective campaigns.

Can you provide a real-world example?

When analyzing the decisions made by our AI optimizing banners, we found that for highly engaged users, the model would choose to only show one product, with its price and other information. Conversely, for less engaged users, the model chose to show a larger set of products, with more diversity and less individual details for products. It’s interesting to see how the model can adapt to the broad or narrow interests of a shopper, depending on their level of engagement. More importantly, no human wrote that behavior into the model, it was entirely emergent from observing the behavior of shoppers online, reinforcing winning strategies and avoiding non-performing ones.

What’s the best way to describe Criteo and its use of AI?

Criteo started with AI technology for recommending movies and then moved into online advertising. We used our AI to show relevant products in display ads and expanded its use across advertising, including user evaluation, creative optimization, catalog analysis, fraud detection, and brand safety.

For 18 years, our main goal has been to connect people with products along the customer journey. We focus on finding the best audiences for products, brands, or retailers, using AI to enhance commerce.

How can AI’s evolution influence product innovation and the capabilities put in place to safeguard consumer experiences? 

As AI improves, it makes product innovation more precise and relevant by better understanding consumer behavior and preferences. This leads to better personalized ads and product recommendations. At the same time, protecting consumer data and being transparent about AI use is crucial. By following strong privacy practices, businesses can keep consumer trust and ensure their advertising is ethical.

Join us at Street Fight LIVE 2024, where you’ll hear from Criteo, as Lucy Kriz brings to life the realities of the customer journey as it stands today.