The seductive promise of AI in content production and campaign running also comes with the risks of bad actors, or the ungoverned machine mind itself, misusing the technology to create misleading or malicious content that tricks consumers.
The latest study from global consultancy Forrester, GenAI Amplifies Advertising’s Risks And Rewards, explains generative AI’s impact on advertising and what marketers must do to maximise its value.
The advertising and media industry is throwing mountains of cash at developing AI, and thereby cutting overheads, in a form of arms race to be the dominant player.
Among the global advertising groups, WPP has a budget of £250 million (AUD480 million) each year for AI.
And the big digital platforms are spending big, including Meta which plans $10 billion just in 2024.
Analysts expect advertising industry enthusiasm will result in job losses but this will be applied unevenly, with some, such as creative problem-solving roles, thriving.
On the client side, brands now expect more versions of a piece of creative, serving different markets or segments, from their agencies. And this is where AI fits in workflows.
“GenAI empowers advertisers to actively deploy and curate AI throughout the advertising process to accelerate workflows, mitigate waste, and break the fourth wall (between a product and a consumer),” said Forrester senior analyst Nikhil Lai.
“However, GenAI risks widespread misinformation, hallucinations, and bad ads.
“Marketers must decide how much autonomy to afford AI, where to source data to train brand language models, and how to use and reuse the time AI saves.
“When they do, they can effectively practise AI-integrated advertising across functions, agencies, and vendors.”
GenAI helps marketers do more with less, accelerating processes such as copywriting, image and video creation and pattern detection.
Retailer Foot Locker used Smartly’s genAI-powered Generation on Feeds tool to reshoot more than 10,000 products in new scenes in minutes, resulting in a 32% increase in click-through rate and a 28% reduction in cost per acquisition
But there’s a dark side.
“The surge of genAI magnifies AI’s upside, but it also brings the technology to a market that can’t adapt fast enough,” Nikhil Lai said.
“If implemented as often as it’s mentioned, AI would distort workflows by forcing creative directors and performance marketers to cede control to semiautonomous, capricious machines.
“Integrating genAI makes brands susceptible to various risks, including regulatory noncompliance, reputational damage, and lost loyalty.
“Advertisers we talk to express sincere fears, doubts, and uncertainties about integrating AI into their processes.”
Without careful governance, genAI threatens: Widespread misinformation (especially during election years); Hallucinations that distort results (making incorrect predictions, often by detecting false patterns in training data); and bad ads (the technology makes it easier for bad actors to create misleading or malicious content that tricks consumers).
Advertisers must trust their CMO to responsibly own AI.
“GenAI’s impacts span various teams and initiatives, but the technology needs to be owned by a cautiously optimistic CMO who separates fact from fiction,” Forrester says
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