ad:tech 2024 - Keynote - AI IS NOW

Summary

The video script discusses the rapid evolution of AI in the creative industry, particularly in photography and film, through the metaphor of 'the jerk,' representing acceleration of acceleration. It highlights the impact on jobs, the transformation of advertising economics, and the potential for AI to revolutionize content creation and marketing strategies. The speaker suggests embracing AI as a new tool, likening it to a camera, and proposes a shift in agency models towards efficiency, personalization, and innovative workflows to stay relevant in the changing landscape.

Takeaways

• 🌟 The rapid advancement of AI, particularly in the field of photography and film, has revolutionized the industry, making high-fidelity, professional-level work accessible to a broader audience.
• 🚀 AI's impact is not limited to technology but is also accelerating the pace of change in various sectors, including advertising, culture, and creative industries.
• 🤖 The term 'the jerk' is used metaphorically to describe the acceleration of acceleration, reflecting the current fast-paced evolution driven by AI and technology.
• 🧐 There is a significant shift in job roles, with some positions becoming obsolete due to AI advancements, while new types of creatives and roles are emerging.
• 💡 AI tools like co-pilot are enabling people to bypass traditional marketing and advertising to get straight-to-the-point information, which could disrupt the current economics of advertising.
• 📈 Investment in AI and technology is leading to a boom in the market, with new players experiencing growth while traditional networked agencies face challenges.
• 🛠️ The adoption of AI in creative processes is allowing for more efficient workflows, reducing costs, and enabling the creation of personalized content at scale.
• 🔍 Tools like Persona Flow are being developed to provide deeper customer insights, enabling businesses to communicate and create content that resonates more directly with consumers.
• 📈 The integration of AI into various workflows is creating a 'flywheel effect,' where personalization and localization of content drive better results and increased conversions.
• 🛍️ AI is influencing not just digital marketing but also product design, sales, and other areas, creating new opportunities for innovation and efficiency.
• 💼 The traditional billing models of the advertising industry may be challenged by AI's ability to create content more quickly and cheaply, necessitating a rethink of agency economics and value propositions.

Q & A

What was the initial perception of Chat GPT about a year ago?

A year ago, Chat GPT was seen as an interesting tool with okay results, and there was a dialogue about its potential to be pretty big at that time.

How has Chat GPT evolved over the past year according to the script?

Chat GPT has evolved from being an interesting tool to changing the face of photography and film, particularly in drone photography, by mimicking lensing and providing unexpected fidelity typically done by large teams.

What does the term 'the jerk' refer to in the context of the script?

In the script, 'the jerk' is a physics term for the acceleration of acceleration, which is used metaphorically to describe the rapid pace of change and advancement in technology and its impact on various industries.

What is the potential impact of AI on the global ad industry as discussed in the script?

The script suggests that AI could significantly impact the global ad industry by creating a large number of images, potentially leading to questions about the scale of creative content production and the future of certain job roles within the industry.

What is the role of AI in transforming the way creative content is produced and consumed?

AI is transforming creative content production by enabling the creation of high-fidelity images and personalized content at scale, which can be consumed across various formats and platforms, thus potentially bypassing traditional marketing channels.

How does the script describe the current economic model of advertising in relation to AI?

The script suggests that the current economic model of advertising, which is based on time-based billing, may be challenged by AI's ability to create content more efficiently and at a lower cost, thus disrupting traditional agency economics.

What is the potential cultural impact of AI on creative agencies as mentioned in the script?

The script indicates that AI could lead to the birth of new types of creatives and influence, accelerating the transformation of fame and influence, and creating the ability to be in all markets and formats at all times.

What are some of the challenges faced by creative agencies in adopting AI tools as discussed in the script?

The script mentions that change readiness, including preparing the organization for AI adoption and managing change resistance, is crucial. It also highlights the need to rework creative workflows, remove inefficiencies, and embrace new tools to avoid being disrupted by AI advancements.

How can creative agencies leverage AI to improve content efficiency and effectiveness?

Agencies can use AI to automate and accelerate content creation, find real customer insights at high resolution, and personalize content to reach a maximum number of customers, thus creating a flywheel effect that drives additional results.

What are some of the potential new surfaces for customer engagement that could be created through AI as suggested in the script?

The script suggests that new surfaces for customer engagement could include in-store experiences, packaging, and interactive digital platforms, all of which can be informed by AI-driven insights and personalized content creation.

What is the potential future of agency-client relationships in the context of AI adoption as discussed in the script?

The script speculates that traditional billing models may be challenged, and agencies may need to explore new commercial models such as service level agreements (SLAs) and technology platforms to provide value to clients and adapt to the efficiency brought by AI.

Outlines

00:00

😲 The Impact of AI on Creativity and the 'Jerk' Phenomenon

The speaker introduces the concept of 'the jerk,' a term for the rapid acceleration of change, particularly in the context of AI's impact on various industries. They reflect on the past year's developments, noting AI's transformative effect on photography and film, specifically drone photography. The dialogue also touches on the fear and excitement that accompany such rapid technological advancements, as well as the potential for AI to replace certain jobs, such as photo retouching. The speaker poses questions about the global ad industry's image creation and the implications of AI tools like co-pilot, which could allow people to bypass traditional marketing to access information directly. The paragraph concludes with a discussion of the 'jerk' affecting not just the work but also the markets and culture, with the emergence of new types of creatives and technological advancements in various fields.

05:03

🤖 Embracing AI as a Creative Tool and the Future of Advertising

This paragraph delves into the speaker's perspective on AI as a new type of camera and the importance of change readiness within organizations. They discuss the challenges of adopting AI, emphasizing the need to manage change and lead people through it. The speaker suggests that overcoming change resistance is crucial for successful AI integration. They also highlight the importance of content efficiency, using AI to streamline creative processes and make content creation less expensive. The speaker introduces 'persona flow,' a tool that uses large language models to facilitate direct communication with customers, thereby collapsing the distance between business and consumer. The paragraph concludes with a vision of AI-powered advertising that respects customer diversity and drives results through personalization.

10:04

🛠️ Enhancing Workflows and the Role of AI in Content Creation

The speaker discusses the integration of AI into content creation workflows, focusing on efficiency and personalization. They describe the process of removing steps and gaps in creative workflows, which accelerates the supply chain and allows for the creation of content at scale. The speaker introduces the concept of an 'extended flywheel,' which incorporates visually intense workflows and data sources beyond marketing, such as product design. They highlight the benefits of digitizing product design and integrating it with marketing to create more varied and personalized content. The paragraph also touches on the potential for AI to transform interactivity, as seen in the gaming industry, and the importance of building workflows to create compounding advantages within organizations.

15:08

💡 The Future of Agency Economics in the Age of AI

In this paragraph, the speaker addresses the challenges and opportunities that AI presents to the advertising industry's economic models. They critique the time-based billing model of network agencies, which they argue incentivizes inefficiency. The speaker suggests that the advent of AI tools that can work faster and cheaper poses a threat to this model. They propose that agencies need to consider new commercial models, such as service level agreements (SLAs) and technology platforms, to adapt to the changing landscape. The speaker concludes by expressing optimism for the potential of AI to become a beneficial companion in the industry's evolution.

Keywords

💡Jerk

In the context of the video, 'jerk' is a physics term referring to the rate of change of acceleration. It is used metaphorically to describe the rapid and accelerating changes in technology and its impact on various industries, particularly in the way creative work is done. The script discusses how this acceleration is affecting the current pace of work and the need to adapt to these changes.

💡Chat GPT

Chat GPT is mentioned as an example of an AI tool that has evolved significantly over the past year, moving from being an 'interesting tool with kind of okay results' to one that has revolutionized photography and film production. It illustrates the theme of rapid technological advancement and its transformative effect on creative industries.

💡Drone Photography

Drone photography is highlighted as an area that has been transformed by the application of AI, with the script mentioning the mimicking of drone lensing and the unexpected fidelity it brings to the field. This serves as an example of how technology is enhancing traditional creative processes.

💡AI

AI, or artificial intelligence, is a central theme in the video, representing the driving force behind the 'jerk' or acceleration of change. The script discusses AI's role in transforming various aspects of the advertising and creative industries, from content creation to customer insights.

💡Content Efficiency

Content efficiency is discussed as a key step for organizations to streamline their creative processes and reduce costs. The script mentions the use of generative AI tools to automate and accelerate content creation, which is a direct response to the challenges posed by the acceleration brought about by AI.

💡Persona Flow

Persona Flow is introduced as a tool that uses a large language model and a rag system to enable direct communication with customer profiles. It exemplifies the script's theme of using AI to gain deeper insights into customer behavior and preferences, thereby personalizing content more effectively.

💡Flywheel Effect

The flywheel effect is a concept used in the script to describe the virtuous cycle created by the combination of insights and content/media workflows. It illustrates how personalization and respecting the diversity of customers can drive additional results and is a direct outcome of the efficiency and effectiveness brought by AI.

💡Product Design

Product design is mentioned in the context of integrating it with marketing through digitization. The script suggests that by bringing product design into the marketing workflow, organizations can create more images per product and achieve hyper-personalization, which is a part of the broader theme of leveraging AI for innovation.

💡Workflows

Workflows are emphasized as a means to create compounding advantages within an organization. The script discusses how building more workflows and reducing manual work can lead to innovation and optimization, which is essential in adapting to the 'jerk' or acceleration of change.

💡Billing Model

The billing model is a critical concept in the script, particularly in relation to network agencies and their traditional time-based billing practices. The script suggests that these models may be counterproductive in the face of AI-driven efficiency and may need to evolve to stay relevant, reflecting the broader theme of industry adaptation to technological change.

💡SLAS

Service Level Agreements (SLAS) are presented as a potential solution to the challenges posed by traditional billing models. The script speculates that agencies might move towards a platform model with SLAS to deliver value in the new landscape shaped by AI and efficiency, indicating a shift in the commercial model of creative agencies.

Highlights

The rapid evolution of AI, particularly in the field of photography and film, has transformed the industry in the past year.

The concept of 'the jerk', a term for the acceleration of acceleration, is used to describe the current pace of technological change.

AI tools like drone photography with mimicked lensing have revolutionized the fidelity and accessibility of high-quality imagery.

The shift from human labor to AI is both exciting and intimidating, with implications for job roles like photo retouching.

The potential for AI to provide direct, unfiltered information could bypass traditional marketing channels.

The current economic model of advertising is being challenged by the efficiency and capabilities of AI technologies.

The emergence of new types of creatives, such as the 'omnistar', is accelerating the transformation of fame and influence in the digital age.

AI is being embraced as a new type of camera, offering creative opportunities alongside traditional photographers.

The second AI Film Festival is an example of how AI is becoming integrated into cultural events and creative expression.

Change readiness and preparing organizations for AI adoption is crucial for managing the transition to new technologies.

The importance of managing change within an organization to ensure successful AI integration and adoption.

Content efficiency is the first step for organizations to streamline workflows and leverage AI for creative content production.

The use of AI tools like Persona Flow to gain deep customer insights and personalize content at scale.

The potential for AI to create a 'flywheel effect', driving personalization and localization in marketing strategies.

The integration of AI into various workflows, from product design to sales data, to create a more efficient and effective process.

The impact of AI on the traditional billing models of the advertising industry, challenging the time-based billing system.

The exploration of new commercial models for agencies, such as SLAs and technology platforms, to adapt to the AI-driven market.

The need for agencies to innovate and adapt to the 'jerk' of acceleration to remain relevant and competitive.

Transcripts

thank

[Music]

you okay well here we are about the jerk

the jerk is coming to dinner and uh

you're going to meet the jerk but first

I'll give you a little bit on the uh

next or the last 12 months and about

five quotes and you know about a year

ago this dialogue happened between our

CE o and and one of my colleagues about

chat GPT we thought it was going to be

pretty big at that time and you know

today forester's metric is is that

they're saying it's going to be about

this big the blank iPhone no iPhone apps

on that and you know what happened next

and we saw you know over the course of a

year it going from being an interesting

tool with kind of okay results to

changing the face of Photography and

then 6 months later something like film

and not just any film drone photography

with the lensing of a drone mimicked and

uh you know just giving us all of that

Fidelity that's completely unexpected

and typically done by huge teams of

people this is really a um a refrain of

this uh a16z quote you know that

software will eat the world but I think

right now we can see quite clearly that

it's being digested you know we're going

from goys to Ai and for a lot lot of

people this is an exciting time but it's

also a little scary you know U this is

an actual text dialogue I had with with

an agency creative uh about a photo

retoucher who realized that her job was

no longer um so who's coming to dinner I

mentioned it was the jerk um and the

jerk is actually uh the physics term for

the acceleration of acceleration and

isn't that exactly what we're

experiencing right now

so if the acceleration of acceleration

is coming to dinner what's for

dinner well there's a few things that

we've heard from people over the course

of the past year questions that we've

been asked as an agency questions like

this this is an interesting question

isn't it how many images does the global

ad industry create I can tell you the

answer afterwards if you like but that's

an interesting question that's a scary

question and this is a kind of a hurtful

comment but uh you know it's relevant

right like can you imagine being a

creative agency right now seeing tools

like co-pilot and so forth uh on the

table and and and of course of you have

conversations with your friends and your

colleagues over the over the course of

dinner and they say things like this you

know I can I can ask chat GPT what's the

best Garmin watch for me and my behavior

and you can get that without any

marketing BS you just get the straight

features and so there's this potential

of the for people to entirely skip the

internet to skip marketing and get to

this information and so really what I

propose is that what's what's for dinner

is the current economics of

advertising and the jerk also dines not

just on what we do but uh on the markets

and we can see you know in the past year

that uh the the largest networked

agencies experienced their their worst

year since

2020 meanwhile we see these curves go up

and that's because of an investment in

in not just ad spend um and also of

course these guys you've heard of them

but the market as a whole is having an

incredible boom and the jerk is also

dining in culture from the birth of new

types of creatives the omnistar

accelerating the transformation of Fame

and

influence uh and and creating the

ability to be in all markets and all

formats at all times little Michaela is

a great example from

BMW to predictive fashion where we're

accelerating Trend Discovery and fashion

and folks like Adidas are hard at work

here and then also things like the reach

of Fame people like YouTubers creating

virtual doubles so that they can also be

in all markets in all formats at all

times and sales agents these these are

deep fakes of Chinese influencers that

exist across their um e-commerce

platforms that's a bit better isn't it

um and then of course accelerating

interactivity the mobile game of the

year all of the NPCs were powered by

large language models so that's uh quite

a

thing um and while many fear the

acceleration many more are are embracing

it like a new type of camera and we're

really celebrating those folks um both

the photographers on our team and the

new photographers that we're bringing

together as part of artist. monks um

people that are embracing the change and

see um see AI as a new type of camera

and and we've published some of their

work in this book ahead of the

lens and right around the bend is not

the first AI Film Festival but the

second one so our partners Runway ml are

uh hosting this very very soon so um

that's another thing that the

acceleration of acceleration brings and

really so the jerk really waits for no

one and and let alone marketers so back

over to dinner here's how I learn to

love the

jerk and to be a diner and not the

dinner um so when you start a dinner

party you serve an appetizer to

stimulate the conversation here's a

little bit of it we um one of the things

that we we like to talk about first is

change Readiness preparing really the

organization for AI adoption is is not

the starting point it's it's preparing

the organization for The Jerk It's a new

Pace right and um and but often these

conversations start with what how can I

get p&l impact like right away how how

do I workflow my organization how do I

adopt these tools and how do I mitigate

these risks these are all super

important questions but it's about the

management of that change and leading

your people through it that makes that

change

stick so it's not changing technology

that's the hard part let's not

underestimate it these are interesting

times to be an integrator but change

resistance is uh from our people is

often the the real

blocker um McKenzie puts a failure rate

at something like

70% and that's usually because it's a

culture of change resistance um and so

it's our jobs to make sure people are

agents and that they have the right

incentives not just you know pay

packages but that the culture itself is

one that's embracing of change um these

are really really important things to

tackle um so building change Readiness

that's that's really the appetizer and

that's how we that's that's what we go

for first uh for the first course of

dinner um is serving up content

efficiency this is the first step of any

organization and for years we've had

incredible data Fidelity we know our

customers like never before and we cons

serve um our media with Incredible

Precision um when and where people are

most

receptive and for years we've been

avoiding the workflow of the creation of

creative content why well content has

just been too too

expensive whoops that's backwards um but

we're solving that today working with

our marketers

our marketing customers helping to

rework flow their

creative um organizations removing steps

removing air air gaps and providing

orchestration of these new tools so by

simplifying by bringing people's PE by

bringing your people along and by

connecting the steps we're accelerating

the supply chain and avoiding a

situation where you have people picking

out tools

from this list for example and and

really getting incredibly s squishy

gains along the

way so Co marketers can deliver content

like

this at with variation like this and it

scales across all kinds of

categories using generative AI tools

powered by

workflows and really we call this the

ability to automate to accelerate and

this is the first step for any

organization second

course uh we serve up Effectiveness this

is the SEC Second Step once you have

this efficiency layer you can start

looking at things like this finding real

customer Insight at really incredible

resolution this is a tool that you're

getting a sneak peek of here we're

launching this next week at nvidia's GTC

it's called persona. flow it uses a

large langu model and a rag uh system so

that you can take your uh customer

profiles and speak to them directly this

really collapses the distance between

the business and the consumer and is

unlocking really interesting things

where anybody within the organization

not just your head of insights um can

speak to their customers and from that

be able to test creative and make better

decisions and so and and yeah and so you

can really start to get closer to this

original promise of digital marketing

which was this idea of a unique piece of

content for each and every

customer and through that you build a

flywheel where that localization that

personalization that respecting of

diversity of your of your customer

starts to drive additional

results so this combination of an

insights workflow through something like

Persona flow this content content and

media workflow this is what gets you

that flywheel effect and for years we've

been trying to optimize both our our

media spend and our creative and or

creative process and instead this

unlocks an opportunity to start

maximizing instead creating a maximum

amount of content to reach a maximum

number of of customers that you might

ordinarily have

ignored and this creates this up uptick

and

conversion that is the end of the second

course for our third course course um we

serve up an extended flywheel so other

visually intense workflows um and and uh

and and data sources are brought into

these workflows it doesn't stop at

marketing you can bring in sales data

from Salesforce for example you can pipe

it through your content creation and

from that you get cool results as well

through product design um product design

has often been very divorced from from

marketing where a product design team

creates a new product they they take a a

great interest and level of refinement

in the tiny little details and then the

marketers go off and do all the

photography and they clever stuff well

by by digitizing product design and

integrating it into marketing you can

create thousands more images per skew

and again do that variation uh for for

localization and Hyper

personalization uh and that's only

possible if you start at the beginning

of the U product design um process this

is actually the um HP capus digital

scanner which um which scans and brings

in High Fidelity uh fabric Swatch

imagery and services the a large chunk

of the um of the fashion and design

world we also can uh touch into in into

other sources like that that allow us to

do Trend seeking picking up what's

happening in culture and bringing that

into our into our uh

workflows creating new data lakes and

allowing us to start to um develop new

surfaces for our customers and um you

know the the panel earlier was talking

about this being the beginning and us

not really knowing what may come next

and I think really um for for

interactivity this is especially true

the the interactive paradigms of today

which have just been shifted to going

back to a promp boxed are going to shift

yet again and yet again uh and and by

freeing up through efficiency and

Effectiveness we free up um investment

possibilities into new surfaces and

those surfaces don't have to be uh

digital ones they can be in store and

they can touch packaging as well and

these are all examples of places where

we're working with our customers on um

on those external to marketing workflows

now workflows are an incredible thing

that they they bring down learning or

they bring down costs they um they

create efficiencies and this concept of

the learning curve is one that I'm

pretty obsessed with right now there's

sort of two ways to create Innovation

with an within an

organization um you've got this constant

investment and optimization learning

through doing like you can see with the

Model T Ford they brought down that cost

um dramatically over the space of a very

very short period of time and then

there's learning through Innovation

which is that that new Surface design um

where you can create real step change

within the

organization so building more workflows

and less manual work this is how we

create compounding

advantages now the final last sticky

course now the network ad agent ad

industry is a is a world in which time

equals money where you Bill for people

at a percentage over the course of the

year and you try to do that as many

hours as possible and when w with these

tools where we can work faster and

cheaper and we can create more content

at less cost you can be sure that

they're going to fight this um it's

really it's a perverse incentive really

when you think about it that that you

build for the hour so the incentive is

to take your time at this um said every

agency ever so efficiency is

counterproductive it hits the

p&l um and it will be resisted and

you'll you'll see this uh and you're

seeing it already really uh the jerk is

great news for clients it's bad news for

the current Network

economics uh and that's because of the

almighty uh time-based billing model

where uh the network agencies are

incentivized to run an inefficient

billing model they're incentivized to

control and hinder access to data to

control access to Media through scale

discounts uh and but we're seeing this

getting disintermediated already with

the platforms uh you know uh doing what

they're doing and wherever possible you

know there's this this uh desire to

drive all creative all creation through

a laborous uh pitch model so I'm going

to speculate a little bit here go out on

a limb but I think there's um there are

models and there are places that we can

go as creative agencies uh to uh to look

at new ways to provide value to our our

clients and to share some of the bounty

that uh these opportunities provide um

we probably won't choose billing codes

this is a sort of tent amount to

unionization if there's one thing that

agency owners are is is is independent

and profit motivated and and there's

really not enough consolidation in the

uh in the uh industry any way for

something to uh like that to work and

we'll probably not do outcomes based

billing either um it's a tricky thing

due to client agency alignment issues

already pretty thin margins and the risk

that would be the burden to agency

owners some agencies have tried this but

typically those agencies are are smaller

with um headed by really strong um

independent leaders um so they they tend

not to be able to scale

well uh but we believe that uh slas and

and and Technology are really The Way

Forward um where agencies can um create

a um a platform

model and uh and deliver in that way so

that was that was dessert uh it's no

small task it's it's the changing of the

commercial model and I I I but I really

believe we're going to see this uh take

place over the next 18 months we'd like

to have a really great dinner party in

2024 and make uh the acceleration

acceleration a great dinner companion so

I think that putting our minds to work

on on the things that we apply uh to the

menu um will'll uh will'll get us there

and and those these are those things

thank

you