How AI Will Force Agency Models to Change

Almost two-thirds (63%) of CMOs plan to deploy generative AI in the next 12 months, and 55% expect to change their relationship with agency partners due to its impact, according to an executive at IBM. 

Why generative AI matters

AI is disrupting the world of advertising – and agency models need to change. That’s the view of Priscilla Kim, APAC marketing and communications vice president at IBM. She was taking part in a WFA-hosted panel discussion at Spikes Asia 2024. “The agency partners in the past were content creators. Now they’re moving more towards becoming content curators,” said Kim, who quoted findings from a global study.

Takeaways 

• The VP called for the advertising industry to be “intentional” about the agency model across the content supply chain. “There has to be an agreed model – right at the front – around who owns and who gets it at what stage in terms of development, iterations, revisions, adoptions, testing and optimisation,” she argued.
• Brand protection is even more paramount with the acceleration of generative AI. “The most important thing I believe agency partners can help us with are things like our privacy, content credentials, legal implications of the content created, and of course … the impact of unintended bias and ethics.”
• What is “absolutely critical” is a governance framework for brand safety, as brands look to agencies for help with matters such as “privacy, content credentials, and legal implications of the content created.”
• Brands also need support from agencies to navigate the unchartered waters of AI. “Agency partners can help us take a step back and ask the question, ‘Is this really what’s going to be meaningful? Is this what’s going to deliver the outcome? What is the benefit for the client and for the end customer?’”
• Change is coming, whether one likes it or not. Former WPP CEO and S4 Capital founder Sir Martin Sorrell summed this up in a separate session at Spikes Asia 2024: “‘Turkeys don’t vote for Christmas’ is my favorite phrase in relation to this and the ability of people to accept change, particularly when it’s not just in our industry.”

Key quote

“Media planning and buying will be revolutionized… the major holding companies probably employ about 200 to 250,000 people in media planning and buying. There will not be this amount of people in three years’ time. The headcount will be drastically reduced because US$650bn on the digital side of the media industry can be reduced by algorithm” – Sir Martin Sorrell, founder and executive chairman, S4 Capital, speaking at Spikes Asia.

Credit: Spikes Asia,  WARC