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AI is completely broken advertising. And every marketer I know has to be doing advertising. On today's show, I'm going to tell you three secrets to advertising in the post AI world. I'm going to show you one channel that has gotten crazy expensive because of AI. I'm going to show you the biggest deal in AI ads today. And I'm going to show you the advertising channel every B2B marketer is really confused about and how to think about it the right way. And on today's show, we are going to tell you how your 2027 marketing budget is probably already wrong, given everything that's changing. Let's get into today's
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Today we're going
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to show you exactly how AI has changed the different ad placements you're using, what they cost, where you should be putting your money, which ads got more expensive, which ads got less expensive. Whether you're spending a few hundred dollars or a few hundred thousand dollars, advertising has never been more important. And AI has really broken a lot of the traditional advertising channels that businesses have relied on. I've talked to founders, I'm talking to founders all the time, and what they're telling me is their ads just don't perform the same way they used to. And the reason that is is because the channels themselves have been disrupted. I want to show you a great example of what I mean. I'd done some research and I dug in and here's some data around one of the most tried and true advertising channels out there, Paid search. Specifically Google Paid search. Now, if you want to look at this, what's really fascinating is I've got two charts stacked up here. The top chart here represents the amount of coverage of Google's AI Overviews feature where you actually get the answer and you don't have to click through to the website. And what you'll see from January 2025 till essentially today, that's gone from about 6% to over half of search queries now have those AI overviews. What's fascinating is if you then overlay that with the actual impact that's had on paid search, it's pretty revolutionary. The cost per click or what you actually have to pay per click on Google has risen about 14% over that period of time. Look, ad prices change, but that's actually not the whole story. The whole story is that the engagement, the paid impressions, the amount of people who are seeing Those ads are down 6% over that same period of time. So your ad prices are going up. And that's not just it they're actually being seen by less people. You're spending more money to get your ads in front of less people on Google because of this changing search landscape. Do I think Google is a smart company and they're going to figure out how to evolve this over time? For sure. But we're spending money, we're buying ads today. And if we're buying ads today, we need to know that AI is completely disrupted search ads and every business is spending a ton of money on search. It doesn't mean you should stop spending money on search ads, but it means you should rethink how you're placing your budget on search and what other channels you're playing on. The really interesting thing about AI is that it's not just disrupting your ads and making them more expensive. There's some places where the ads are actually getting cheaper. What I want to show you now is I, I'm unveiling what are the five most expensive ad channels in this post AI world and what are the five cheapest ones. And it's actually pretty interesting. You see a lot of expense around other programmatic cost per click channels like Amazon and LinkedIn. But then you also see it around really high prime brand placement because as paid search is getting disrupted, people are also spending a lot more money on brand dollars. That's why you see the big takeovers in Times Square or premium TV like Netflix and prime really increase in costs. There's one line on here though that I think is the most important line on this chart and it's right down here. It's YouTube Shorts. The price of YouTube Shorts, which is a $4. 85 cost per thousand impressions. So it costs you $4.85 for a thousand people to see your ad on YouTube Shorts is I think one of the biggest arbitrage opportunities in marketing. It's a huge opportunity to buy low and sell high. Why is that? It's an amazing opportunity because AI has made it easier to make videos. And so if you are a influencer or you're a creator, you can make better videos and you can make more of them. And that takes the inventory of videos, especially short form videos on platforms like TikTok and, and in this case YouTube shorts means there's more of them. And so you've got more people making videos, more people consuming them. The gap is in the companies placing those ads. What's happening is that there's been a gap from the creators adopting AI tools to make more videos and the businesses adopting AI tools to make more video Ads, Video ads take a little bit more work. You have to have product shots or screenshots. You, you have to have the right visual effects, the right text. What you can't do is just write a sentence of copy and put it in Google search. That you can do really, really fast. Video ads take a little bit more time and that time and effort is your opportunity. Hey, if you're loving the show today, I'm giving everything away. You can get the research, you can get the prompt I used to do a version of the research for yourself. If you want it all, click that QR code, click the link in the description below and you can get it all for free. If I were running marketing for any company right now, the number one thing I would do is I would figure out the tooling I would be using hey gen and captions, AI and all these awesome video tools canva to actually build a new workflow to make video ads for YouTube shorts. Because the cost at $4.85 per 1000 impressions is a bargain. And it's a bargain because I have far less competition. And if I can make really great ads, I can likely get more customers and as a leading indicator of customers leads for my business than I can on a lot of the traditional channels like paid search and classic cost per click channels. This is the dynamic of ads. If you're willing to take a little bit of risk and you're willing to build a new motion, in this case learning how to build video ads, you can get a huge upside of growth and get a lot more customers for a lot less money. And for me, YouTube Shorts is the ads opportunity because these AI video tools have made it easier for everyone to create compelling, high quality, human focused videos. And advertisers have not caught up yet. I don't think this is a long window. I think this window is going to last for 12 to 18 months before the cost of YouTube shorts really comes back in line. But it is a great buying opportunity right now and if you are a marketer, it is some place where I would at minimum be running some tests and if not even be bolder and consider moving a real part of my budget into YouTube shorts. So on September 22nd, if you've been following the show, you know Kieran and I have our new book coming out. It's called Loop and it is a new four step framework for how you do anything you want to do in marketing. And I want to bring what I'm saying with YouTube shorts to life right now using that framework. It's a quick four step framework. The first step is express and it's how you actually come up with the initial concept and idea of what you want to do. And so case of YouTube shorts ad you would take customer interviews, sales calls, any information like that you had, as well as any product information or whatever you're trying to promote. Put that in your AI tool of choice and ask it to generate some core scripts for YouTube shorts. And what you'll see is you'll get five, ten scripts back. You'll probably really like one. Take that. And you've already done the first stage of the loop because you have this rough script that you can kind of edit and shape. The second stage here is tailor. And tailor is all about how you make that message personal to your audience. And for something like YouTube shorts, it's actually about targeting. So you'd go in and make sure that you're not targeting your whole audience so, but instead a subset of your audience that really goes and aligns with the message you've taken. The third step is amplify. That's like, hey, I gotta go make and record this ad now and actually make the video and hit publish and put some dollars behind it. That's pretty straightforward. And the last stage of the loop is evolve. And evolving is all about how you measure and make better. And so what you want to do is you want to actually look at the data. And I would even take the data from the first week or two of your ad being live, take that as well as your content, put it in your AI tool of choice and use that to get real insights on how you could make it better and how you could get the performance better the next time. And that's what we mean when we talk about the loop. Once you actually get a core set of learnings, you start the loop all over again. Because you can then go make a new script, a new video, new targeting, and actually get better. And what we found is that if you just work and do marketing like this, you, you learn at an exponentially faster rate and you keep getting better and better performance. And it's going to change how you think about marketing, but more important, how you think about something as simple as an ad test on YouTube shorts.
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The third takeaway for anyone doing ads in the world today is that LinkedIn for B2B marketers is the most confused, misunderstood advertising platform out there. This is a hill I will die on. I talk to two types of marketers. One type of marketers, it's like, oh my gosh, LinkedIn is so expensive. It's my most expensive channel. I just can't get it to work. I just don't understand. The other type of marketer I talk to is, oh my gosh, LinkedIn is incredible. The targeting is amazing. You, it is by far and away our most effective ad channel. I wish I had the opportunity to spend more money on LinkedIn because I know I could get more customers. So why is there such dichotomy of marketers out there when it comes to LinkedIn? Because I am more in the latter, that LinkedIn is an amazing underutilized channel in B2B advertising, especially because I think most marketers are just touching the surface of what LinkedIn can do. And the reason for that is also something we talk about. In the Loop book, we talk about this idea of creative equations. And in the new world post AI of marketing, the best marketing happens when you start with new equations of how you think about and measure your marketing. And LinkedIn is a perfect example of that. The marketers who tend to just think LinkedIn is super expensive is one, they just look at it on a cost per impression basis. And if you look at LinkedIn on a cost per impression basis, it's actually very expensive. You know, you see here single image ads, the cost per thousand impressions is almost $60 versus less than $5 on YouTube shorts that is exponentially more expensive. However, the level of targeting that you get can mean that your cost per click is much, much lower than on other platforms. And it's likely, depending on your product or service, you could have a lower cost per click on something like LinkedIn compared to to YouTube shorts. But it's all going to come down to one, how you measure it, and two, are you able to run the loop? Are you able to actually say, here is my unique message that's very focused. Am I then tailoring that audience and I'm getting the right targeting that's deeply aligned with that message? And this is where most marketers fall apart. They have a generic message and they send it to a broad audience and then their ads are really expensive. Instead you want to do the exact opposite, have multiple specific messages that you deliver to individual groups of very tailored audiences. Then you also still need to through that amplify stage, make really good ads and have really good copywriting, really good creative. And then again got to look at the data and look at that data in a creative way to make sure that you're not getting blinded by an initial cost like a crazy high cpm and instead you're focused on the customers you're getting through really relevant messaging and targeting. LinkedIn should be a key part of every B2B marketer's advertising budget. And if it's not, I would implore you to rethink how you're measuring your LinkedIn performance. Get that new creative equation right and run some new tests using the loop here and I wrote a book together. It's almost here. Loop Out, Learn Out Market Outgrow Drops in September to celebrate the launch, I'm hosting an early reading Aug. 18 at the Boston Public Library from 6:30 to 8:30pm there's going to be a preview of a book, there's going to be a Q and A where you can ask any of the questions about the Loop framework that you might have and the event is totally free. We'll have some food, some beverages and we get to hang out and have a great time. If you're in Boston and you can make it, we'd love to see you. The registration link is below. Grab a spot before they're gone. On today's show, I told you three major things that were happening in advertising. One, that the disruption in AI search is causing cost per click ads in search engines, especially Google, to increase in cost while being shown to fewer and fewer people. And so you still need to show up there and still needs to be an important part of your mix. But it might not be as big of a part of the mix as it has been historically for you. The second thing is I showed you what I thought was the biggest deal in B2B advertising today, and that is YouTube shorts because the supply demand is out of whack. If you can build the muscle to create really good video ads, you can get customers for a much lower price than many of the other channels because the costs are so low. The last thing is we talked about the LinkedIn paradox and how so many B2B marketers are divided. I helped you think about using creative equations and really changing your ad strategy to be much more focused and targeted to drive much more effective cost per clicks and therefore lower cost of customer acquisition using LinkedIn as you're thinking about your marketing spend next year, I hope you consider how advertising is changing and these three opportunities. We'll see you real soon on the next episode of Marketing against the Grain.
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Let me tell you about another great podcast, this Old Marketing, hosted by Joe Pulizzi and Robert Rose. Joe Polizi and Robert Rose, two of the most well known experts in the content marketing space, talk about the latest content marketing trends and discuss how business businesses can use content to attract and retain customers. Each podcast show features a discussion of content marketing headlines, rants from Joe and Robert on what's going on in the industry, and a this Old marketing example from the past that we can learn from. Always useful, entertaining, and never more than 60 minutes. They recently did an episode called Doing the Job Is no Longer Enough about the changing relationship between companies, creators and employees. Listen to this old marketing wherever you get your podcasts.
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This data is wrong every freaking time. Have you heard of HubSpot? HubSpot is a CRM platform where everything is fully integrated.
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Whoa.
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I can see the client's whole history. Calls, support, tickets, emails, and here's a task from 3 days ago I totally missed HubSpot grow better.