Madison Avenue Braces for the AI Apocalypse
The industry experts are discussing the future of advertising and the challenges it faces in the digital age. Many are concerned about the rapidly changing landscape and the impact it will have on traditional advertising methods. The Cannes Lions festival is a hub for these discussions and debates about the future of the industry. Executives are exploring new strategies and technologies to adapt to the evolving media landscape and reach consumers effectively. The conversations at Cannes Lions reflect the industry's urgent need to innovate and stay ahead of the curve.
Is the advertising industry staring down its “let them eat cake” moment? Thousands of media and tech executives are descending on France for the annual Cannes Lions festival (June 16 to 20), where they will schmooze and sip Aperol Spritzes at parties, and perhaps commiserate in between panels at Meta or Spotify Beach, or on one of the dozens of yachts docked in the harbor.
The Current Landscape
The talk of the town is what one veteran media exec frames as the “insane chaos and disruption” that AI is beginning to unleash as the major ad agencies and buying firms slash thousands of jobs in the name of automation and consolidation. It already is being felt at the very top of the industry: Just days before the Cannes Lions kickoff, WPP CEO Mark Read revealed his intention to depart at year’s end, reassuring staff that “we are now leading the way as AI transforms marketing” and that the company is equipped “to face the future confidently and capture the opportunities ahead.”
And Omnicom and IPG are lurching toward a $13 billion megamerger, which is premised on creating an ad giant that will be “poised to accelerate innovation and harness the significant opportunities created by new technologies in this era of exponential change,” as Omnicom CEO John Wren said when unveiling the deal.
The Impact of AI
That exponential change, ad agency veterans say, is based on a few things: The practice of buying and selling, which was once hashed out in smoke-filled rooms and at glitzy events, is already increasingly automated, and AI will only turbocharge that as potential AI agents tasked with creating full media plans are deployed. On the creative side, AI will dramatically change the creation of ads themselves.
Meta, for example, wants to have AI tech in the market allowing brands to create, target, and deploy ads by the end of next year. Across the industry, tools are being developed that allow brands to upload images of their product, which can be quickly iterated into dozens of ads or video spots. The end result is a business that could be radically smaller.
The Role of Agencies
While some believe that agencies will continue to play a vital role, others foresee a more significant impact. “I’m afraid that in a couple of years, the big ad agencies will be a shadow of what they are today,” admits the former CEO of a top Madison Avenue firm. “Nothing can match human creativity and experience, but from research to placement to creative, a lot of what the agencies have done can be replicated pretty well by AI.”
The Future Outlook
Not everyone agrees that the end is near. Alex Schultz, the CMO of Meta, believes that AI will enhance agencies' ability to focus on creativity. However, the AI revolution is inevitable. Coca-Cola and Kalshi have already utilized AI tools for creating ads, and more companies are likely to follow suit.
As the industry evolves, traditional media and streaming services will need to adapt to the changes brought by AI. While entertainment giants have advantages, such as live sports content, they will still need to embrace AI-driven strategies to stay competitive.
HONESTAI ANALYSIS
Despite the looming disruptions, the industry sees potential in the blend of human creativity with AI tools. As the landscape evolves, the future of advertising will likely involve a balance between automation and human input. “The good news is AI is not going to kill advertising. The bad news is AI is not going to save advertising. We’ve got to save ourselves, by believing in what’s always made this industry special: human creativity,” remarked Apple vp Tor Myhren.