The AI train shows no sign of stopping. Cumulative AI investments by the big four US tech giants (Alphabet, Amazon, Meta and Microsoft) could be close to half a trillion dollars in 2026 if current trends continue. Both the Chinese and US governments have made it clear that they view supremacy in AI as key to their superpower rivalry. Wherever we look, AI seems to be at the centre of things.
If you believe the AI evangelists, then this level of attention is warranted. AI transformational power will lead to a revolution across all manner of industries and even society, according to this mantra, just as the Industrial Revolution transformed the 19th century.
Yet it may also be the case that the talk about AI is running ahead of its capabilities. More importantly, it may be running ahead of what the average consumer wants and is willing to tolerate. While most people are likely to be aware of the technology (who could not be), they probably do not view it in the same positive light as those who are making the most noise about the new technology.
For the average person, AI means—most of all—the potential for job losses. At least in terms of its impact on jobs, AI already seems to be delivering, as firms use the rationale of AI to make job cuts and reduce graduate hiring.
The disconnect between the claims around AI and what it can actually do is particularly relevant for the advertising industry. The industry is embracing the technology. AI-produced adverts are already appearing, as are AI media plans. In an industry where headcount forms the bulk of costs, the temptation to automate will be considerable.
Yet it should be resisted.
One reason is that the industry may talk itself out of a business. Mark Zuckerberg's comments that Meta could run an ad campaign for a client from start to finish (from creating the adverts to showing them) should serve as a warning: if advertising becomes simply about who can deploy the best AI features to create adverts at the cheapest price and at the quickest pace, then the advertising industry will lose.
However, there is a more important issue here, and that is consumers. For a start, the human race has evolved to view the artificial and fake as a warning signal, embodying a potential risk to self-preservation. Start bombarding the screens with AI-generated adverts, and consumers may start to associate the products being advertised with being artificial and fake. That's never a good look.
Moreover, AI is only ever likely, because of its design, to produce something average. It might be average good, but it may also be average bad. In any event, it is very unlikely to ever produce the result that a truly brilliant advertising campaign can produce.
And that may not be the worst of it. AI doesn't really care about whether your advert lands with a thud but, as the example of the controversial Bud Light's 2023 US ad campaign featuring Dylan Muhlvaney shows, a poorly received advert can wipe literally billions from your top line. Of course, humans mess up (as happened with Bud Light), but AI-produced adverts combined with reduced workforces open up the potential for these types of events to occur more often.
It is very easy, sitting in the advertising world, to believe that the average consumer thinks and acts as you do. That is why, as Thinkbox in the UK has shown, media executives overestimate significantly the recanted of consumers using the likes of TikTok and underestimate those watching television. Yet, if the industry starts to believe that AI is more important to its success than its creative brilliance, then it risks losing consumers altogether—and the industry.
Ian Whittaker is the founder and managing director of Liberty Sky Advisors. He writes a regular column for Campaign about the advertising landscape from a financial standpoint. This opinion piece is not investment advice.
