Brands lean in on AI’s creative and operational uses despite hesitation

The insight: Coca-Cola’s AI remake of its “The Holidays are Coming” ad drew controversy and criticism for its quality, but it nonetheless shows the creative potential of the technology and the strides it has made in a short time.

Though the beverage giant is one of the most prominent brands to incorporate AI in ad creative in a big way, it isn’t alone.

• Toys R Us unveiled an ad at Cannes made entirely with OpenAI’s text-to-video tool Sora in June, marking one of the first high-profile AI spots and one of the first public uses of Sora, which is now publicly available.
• IT management platform Atera used AI to generate visuals to build on human concept development and scriptwriting. The AI video production completed work that would have cost up to $1 million in real life.
• PetSmart Charities used AI to produce colorful profiles of animals available for adoption.
• Klarna used AI for image generation, translation, and other tasks once performed by outside firms. It unveiled a customer service chat that can do the work of 700 people and plans to cut 1,800 jobs as it leans in on AI
• Ad agencies have invested in AI, with leaders like WPP and Publicis disclosing plans to spend hundreds of millions on the technology. A Forrester survey of ad executives found that 91% of US ad agencies were engaging with generative AI.

Brands increasingly recognize AI’s ability to pinpoint ad improvements and tailor messages. Jonathan Woolf, chief revenue officer at AI analytics provider Intent HQ, outlined some practical applications of the tech in an EMARKETER interview.

• The technology can predict conversion rates for engagement activities across customer segments and identify when to send messages based on user behavior, such as during a morning commute, evening at home, or specific activities.
• AI’s ability to refine message timing led one financial services provider to realize a nine-fold increase in clickthrough rates. "The AI on the phone is able to choose that optimal moment to engage," Woolf explained.

Yes, but: Even as AI use in marketing and advertising picks up, concerns persist, with 80% of multinationals uneasy about how their creative and media agencies use genAI on their behalf, per September 2024 research from the World Federation of Advertisers. Legal (66%), ethical (51%), and reputation risks (49%) were also cited as top concerns.

VML’s chief growth officer JJ Schmuckler noted that the tech has become table stakes for clients of big agencies. But he noted brands were not requesting that AI be used to create campaigns, calling that “a step too far for everybody.” It’s a recognition that clients value the human element of storytelling.

Our take: As AI technology continues to be refined, it offers the opportunity to bolster creative and operational aspects of advertising. The technology is becoming indispensable as it offers brands the ability to solve practical problems at dramatically lower costs.

Go deeper: Read about other ways brands are using AI in our report, Generative AI for Ad Creative.

This article is part of EMARKETER’s client-only subscription Briefings—daily newsletters authored by industry analysts who are experts in marketing, advertising, media, and tech trends. To help you finish 2024 strong, and start 2025 off on the right foot, articles like this one—delivering the latest news and insights—are completely free through January 31, 2025. If you want to learn how to get insights like these delivered to your inbox every day, and get access to our data-driven forecasts, reports, and industry benchmarks, schedule a demo with our sales team.