Fintech firm cuts annual marketing budget with Generative AI by $10M
By Ralph Tathagata
Klarna, a fintech firm and one of the early adopters of Generative AI (GenAI), said it has cut its sales and marketing budget by 11% in the first quarter, with AI responsible for 37% of the cost savings, while increasing the number of campaigns.
The company said it is using AI for purposes such as running marketing campaigns and generating images, saving about $10 million in costs annually.
In a statement to Reuters, David Sandström, Karna’s Chief Marketing Officer, said, “Traditionally, it would have been very costly to cater to these occasions with bespoke imagery, but with AI that is no longer an issue. Essentially, we have removed the need for stock imagery.”
Using GenAI tools like Midjourney, DALL-E, and Firefly for image generation, Klarna said it has reduced image production costs by $6 million.
It is using GenAI to update images on its app and website on a weekly basis, reflecting key retail events such as Valentine’s Day, Mother’s Day and summer sales.
The statement further revealed that it has generated more than 1,000 images in the first three months of 2024 using GenAI, reducing the image development cycle from six weeks to seven days.
A further $4 million in savings comes from cutting spending on external marketing suppliers for translation, production, and social agencies.
Klarna noted that it had partnered, opened new tab with OpenAI for an AI assistant for its customer service that the company said was doing the equivalent work of 700 full-time agents.
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