Meta rolls out AI ad tools for e-commerce & retail businesses

Meta has announced new tools designed to drive growth and improve performance for e-commerce and retail businesses. As the e-commerce sector in India expands with the rise of quick commerce and online shopping in tier-2 and tier-3 cities, these new ad tools aim to further accelerate business growth.

Among the new offerings is omnichannel ads, which allow advertisers to display ads highlighting nearby store locations to shoppers most likely to visit in person. The platform is expanding access to omnichannel ads, adding features that help direct shoppers to nearby stores with in-stock products and highlight available discounts. Initial testing showed that advertisers using omnichannel ads saw a 15% lower omnichannel CPA and a 12% higher media ROAS compared to standard campaigns.

The platform recently hosted the Meta Marketing Summit E-Commerce Edition, bringing together leading marketers in Mumbai and Bangalore to discuss emerging trends in India’s e-commerce landscape.

Meghna Apparao, Director of E-commerce and Retail at Meta India, said, “E-commerce and retail are witnessing a material shift in India, driven by more offline retail brands reaching customers online, the rapid growth of quick commerce, and increasing online shopping in tier-2 and tier-3 markets. While AI-powered personalisation, Reels, creators, and messaging have already delivered immense value, Meta’s focus on innovative ad tools will be pivotal for the sector’s growth, enabling brands to create impactful shopping experiences and achieve their key business objectives.”

Aishwarya Omprakash, Head of Marketing at Taneira, said, “In our pilot campaign using Meta’s omnichannel ads, we observed a significant boost in performance, achieving 3.5x higher purchase conversions and 4.3x higher Return on Ad Spend (ROAS) compared to purchase-optimised campaigns. This reinforces the value of a multi-touchpoint strategy, and we are excited to explore it further.”

Harnessing AI, the platform will soon integrate Partnership Ads with Advantage+ catalogue ads to provide businesses with enhanced advertising capabilities.

Partnership Ads enable brands to run ads featuring content from creators, brands, and businesses. India has the world’s largest community of Instagram creators, and more than 4,000 advertisers in the country already use Partnership Ads.

Pawrush Elavia, Head of Growth at Zepto, said, “We used the authentic voice of creators to highlight our 10-minute delivery USP by leveraging Partnership Ads. The campaign resulted in an 18% lower CAC and a 33% higher CTR compared to business-as-usual strategies.”

The platform is also introducing an AI-powered optimisation for Advantage+ catalogue ads, allowing its system to display additional relevant products beyond the advertiser’s preferred set. In initial tests, advertisers saw a 14% increase in ROAS on average.

Continuing its AI momentum, the platform is developing Generative AI-powered features for e-commerce brands. In the coming months, the company will explore new tools, including virtual try-ons that use AI to display clothing on virtual models. The company is also testing background generation in catalogue ads and experimenting with personalised text generation for better ad merchandising.

Generative AI is already being used by Indian e-commerce businesses. BigBasket, an early adopter of Meta’s AI features, tested GenAI-powered catalogue ads and reported positive results.

Anand Bhaskaran, Head of Digital Marketing and Marketing Communications at BigBasket, said, “We are committed to staying ahead of the curve with new marketing approaches. That’s why we were eager to test GenAI-powered catalogue ads. The results were great, and we are confident this technology will continue to drive efficiency for our business.”

BigBasket ran a three-cell test for catalogue ads, comparing Background Generation and Image Expansion against standard campaigns. The test showed a 2.7% higher click-through rate (CTR) and a 3.4% lower cost per install (CPI) than standard ads.