Generative Artificial Intelligence (AI) in the Digital Marketing Market 

The global generative AI in digital marketing market size was valued at USD 2.9 billion in 2024 and is projected to grow at a CAGR of 37.1% during the forecast period. Generative AI is useful for developing intelligent chatbots capable of handling complex inquiries. The AI-powered chatbots utilize natural language processing to enhance consumer experience. AI handles large-scale marketing efforts. Ensuring data privacy and security is crucial when using AI to personalize marketing campaigns. 

Generative AI helps meet the growing demand for highly customized content such as text, images, and videos. Brands face immense pressure to produce content quickly. Generative AI automates the creation of blogs, advertisements, product descriptions, and videos. The growth of e-commerce boosts the demand for AI-generated product descriptions, targeted ads, and recommendation engines.

Marketers are using gen AI to analyze competitor moves, assess consumer sentiment, and test new product opportunities. Rapid generation of response-ready product concepts can improve the efficiency of successful products, increase testing accuracy, and accelerate time to market.

Growth Drivers 

Due to the increasing demand for personalized experiences, generative AI can create unique content for each customer, including email messages, landing pages, and product recommendations. Marketing professionals can leverage this to boost engagement and improve the relevance of their marketing communications. With rising demand for richer and more engaging interactions, generative AI can facilitate augmented reality experiences. AI leverages extensive datasets to predict which segments respond best, forecast trends, and optimize budget allocation. The growth of AI agents and AIaaS platforms is becoming crucial for managing tasks in marketing and finance—AI-as-a-service solutions make it easier for companies to use AI without needing a lot of their technology. With AI-driven answer engines, marketers need to adopt answer engine optimization to maintain visibility.

In countries like the United States of America, most marketers are using AI tools like ChatGPT.  AI is deeply embedded into the digital marketing landscape, and based on the latest reports, more than 80 percent of industry experts integrate some form of AI technology into their online marketing activities. This vast adaptation of artificial intelligence for marketing purposes is no surprise considering that its benefits include task automation, campaign personalization, and data analysis, to name but a few.

Market Segmentation

Generative AI in Digital Marketing by Component

·         Services

·         Software

Generative AI in Digital Marketing Systems by Type

·         Text Models

·         Multimedia Models

Generative AI in Digital Marketing by Application

·         Content Generation

o   Text Generation

o   Image/Video Generation

o   Audio Generation

·         Search Engine Optimization (SEO)

·         Lead Nurturing & Lead Scoring

·         Reporting & Analytics

·         Social Media Marketing

·         Other End-Use Application

Generative AI in Digital Marketing by End-User

·         Media & Entertainment

·         IT & Telecommunications

·         Healthcare

·         Automotive & Transportation

·         BFSI

·         Retail and E-commerce

·         Other End-Use Industries

By Region

·         Asia Pacific

·         North America

·         Latin America

·         Middle East and Africa

·         Europe

Generative AI in Digital Marketing Systems by Type

Based on the Type the Generative AI in Digital Marketing Market is segmented into Text Models, and Multi-Media models. Text models are the leading market segment, and are expected to dominate the market during the forecast period because of their use in content generation like in blogs, and social-media campaigns, and high adoption across the industries. Text-based tools like ChatGPT and Copy.ai is widely used by marketers. Less data is required in it, and text content directly affects customer journey stages like awareness, consideration, and conversion.

Multimedia models are rapidly growing due to interest in dynamic content, and they are less mature in direct ROI delivery in comparison to text models. Effective use of Generative AI requires a collaborative approach between humans and AI to achieve optimal results. 

Generative AI in Digital Marketing by Component

Based on the component, generative AI in digital marketing market is segmented into services and software. Software is the leading market segment because generative AI relies heavily on software platforms, tools, and algorithms to generate content like text, images, videos, and codes. Software platforms are easily scaled, customized, and integrated with CRMs and digital ad platforms. Services (like consulting, deployment, training, and managed services) are crucial for implementing GenAI solutions, as they often depend on software tools, and adoption of GenAI software often precedes and drives demand for services.

Generative AI in Digital Marketing by Application

Based on the application, the Generative AI in Digital Marketing market is segmented into Content Generation, Text Generation, Image/Video Generation, Audio Generation, Search Engine Optimization (SEO), Lead Nurturing & Lead Scoring, Reporting & Analytics, Social Media Marketing, and Other End-Use Application. Content Generation is the leading market segment, and is expected to dominate the market during the forecast period because it is at the core of digital marketing efforts, and generative AI tools are extensively used to create high-quality content. Text generation in particular is the leading market segment for improving customer engagement, and brand presence online.

Other segments like Search Engine Optimization, and social media marketing is also witnessing steady growth during the forecast period, as generative AI optimizes content and enhances engagement strategies in these areas.

Generative AI in Digital Marketing by End-User

Based on the end-user, generative AI in digital marketing market is segmented into media & entertainment, IT & telecommunications, healthcare, automotive & transportation, BFSI, retail & e-commerce, and other end-user industries. Retail and e-commerce are the leading market segments and are expected to dominate the market during the forecast period. Retailers use generative AI to create personalized marketing content at scale, increasing engagement and conversions. The growing demand for frequent content updates is driving efficiency through automation provided by generative AI.

Media and entertainment are another leading segment due to the high demand for fresh, engaging content. Heavy content consumption, production needs, and AI-powered code generation for digital campaigns are fueling market growth. Healthcare is also witnessing steady growth due to the need for virtual health assistants and AI-powered telehealth promotions. AI-generated vehicle ads and digital showrooms are significantly boosting market growth. The BFSI sector is benefiting from AI-generated investment newsletters and fraud alerts. Among all segments, media, and entertainment stands out as the top segment due to the high demand for creative content and the rapid adoption of GenAI-powered tools for consumer engagement.

Regional Outlook

Based on region, the generative AI in the digital marketing market is analyzed into five areas: Asia-Pacific, North America, Latin America, the Middle East and Africa, and Europe. The North American region is the leading market segment and is expected to maintain its dominance during the forecast period as the area broadens the scope of AI-driven customer engagement strategies. Increased demand for chatbots, virtual assistants, and personalized recommendations is significantly driving market growth.

Asia Pacific is expected to emerge as the fastest-growing regional market, with a CAGR of 40.1% over the forecast period. A significant development in the Asia Pacific generative AI market is the rising adoption of AI-fueled influencer marketing strategies. Businesses are leveraging generative AI to identify suitable influencers, analyze audience demographics, and generate tailored partnership proposals.

Over the last decade, e-commerce companies and other organizations have deployed AI for various marketing applications, including A/B testing advertisements and automating marketing campaign essentials like email blasts. However, with the emerging sophistication of generative AI tools like ChatGPT, new technologies are set to revolutionize digital marketing. These advancements have led to significant innovations in AI marketing in a short time. Generative AI models utilize machine learning techniques to generate text, images, audio, and video. These models are trained on extensive datasets, learning patterns, and structures within the data to produce outputs that replicate human decision-making. The presence of key market players in the region is fueling the market growth significantly.

The European market is also experiencing steady growth during the forecast period due to the presence of key players, with businesses in Europe increasingly seeking ways to automate repetitive tasks and personalize customer experiences to remain competitive.  Generative AI offers tools for content creation, customer service, and more, enhancing operations and improving customer engagement.  Europe has a vibrant AI startup ecosystem, with numerous companies focusing on generative AI solutions.  These startups are driving innovation and introducing new ideas to the market. The European market also benefits from growing awareness of AI across various industries, the availability of large datasets, and the increasing adoption of cloud-based AI platforms. The presence of key players is fueling the market growth significantly.

Increasing smartphone adoption, digital consumption, and support by the governments is the reasons behind the growth in Generative AI in Digital Marketing Market. AI in Latin America is also experiencing significant growth, with companies like SAP and Google offering AI tools for digital marketing. Countries like Brazil, Argentina, South Africa, and the United Arab Emirates are witnessing significant growth during the forecast period.

Key Players

·         Adobe Inc.

·         Amazon Web Services Inc.

·         Genie AI Ltd.

·         Google LLC

·         IBM Corporation

·         Microsoft Corporation

·         MOSTLY AI Inc.

·         Open AI

·         Synthesis AI

·         Paige.AI

·         Rephrase. AI

·         Other Players