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Greed(y) is good!

· AI Budget Allocation,Aitarget tool,Technology

Aitarget is pleased to introduce its new program, AI Budget Allocation, which redistributes campaign budgets to the most effective ads with the epsilon-Greedy Algorithm.

Sounds good, what is it?

AI Budget Allocation is an automated technology that can optimise marketing spending based on its effectiveness.

This technology redistributes a fixed part of your campaign budget between ad sets so that the more effective ones would receive more money. The effectiveness of each ad set is estimated by number of conversions and their costs.

The rest of the campaign budget is distributed in equal proportion between all ad sets not to have them turned off.

Okay, so what does that mean?

AI Budget Allocation is based on a mathematical algorithm called epsilon-Greedy.

With this program, the daily campaign budget remains fixed throughout the test. The algorithm evenly allocates the epsilon part of the budget (the smaller one) between all ad sets within the campaign. That allows the ad sets to stay at an above-zero level. The rest of the budget (which is calculated as the whole minus the epsilon part) is distributed between ad sets in proportion to the rating of their results (by CPC, CPI, CPA, ROI).

Simple, isn't it?

Why should I use it?

Do you care about the quantity and price of your results? Are you unable to spend days on end tracking the ad set delivery results? Do you get moody and grumpy because of the necessity to change your ad sets budgets manually? If you answered yes to any of these questions, Aitarget Budget Allocation will be of use to you.

Putting greedy into practice - a case study

Marketing Master Lab, a full-service marketing agency with headquarters in Argentina, kindly agreed to test the AI Budget Allocation technology with us.

We selected two completely identical campaigns for the test: each with 10 ad sets and the same daily budget. The goal was to get optimisation by redistributing budgets based on Cost per Comment.

After the first day of delivery (that’s how long is needed for statistical purposes), we added AI Budget Allocation to one of the campaigns. The program then started to redistribute the budget of that campaign based on the performance of each of the ad sets in it. The budget of the campaign with AI Budget Allocation stayed equal to the budget of the other campaign.

On the second day, the Cost per Comment began decreasing for the campaign with AI Budget Allocation, while total comments increased. This trend continued for several days.

Let's take a closer look

Campaign without AI Budget Allocation

Campaign with AI Budget Allocation

Note the difference between the budgets of two campaigns: the reference campaign budget stayed the same between all ad sets. In comparison, the test campaign budget was different on every single ad set.

Campaign without AI Budget Allocation

Campaign with AI Budget Allocation

To sum up:

  • The test lasted for seven days;
  • With AI Budget Allocation, the amount of comments increased by 20%; and
  • Cost per Comment decreased by 20%.

A satisfied client

Juan Cruz Pagnutti, Creative Director at Nitro Social Marketing

"We would like to thank the Aitarget team for the new effective tool. I was left completely satisfied with the results. Thanks to AI Budget Allocation we were able to achieve the results we were looking for: more comments for less money. Also, the Aitarget support team is especially nice to work with."

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