Meta's Vision to Replace Ad Agencies with AI

So during Meta's Q1 earnings call, Mark Zuckerberg raised some eyebrows when talking about his vision for the role of AI in advertising. Here's what he said:

"Our goal is to make it so that any business can basically tell us what objective they're trying to achieve, like selling something or getting a new customer, and how much they're willing to pay for each result. And then we just do the rest."

Make no mistake, he's taking direct aim at ad agencies. The entire business model is at risk if his vision becomes reality.

Not surprisingly, a whole lot of people were angered by these comments. I'm also seeing some who are laughing it off as being impossible. But you're not going to hear me laugh this off. I believe it's probable that we end up somewhere close to what Zuckerberg describes. The question is the timeline.

Let's back up. What is he actually saying? What are the obstacles to achieving this? And what will it mean for advertisers and the ad agency business model?

Let me rephrase what was said on that earnings call. Any business will be able to provide the following information: an objective (like a sale) and how much they're willing to pay for that result. That's it. Once you provide that info, Meta does the rest, including the copy and creative.

I've also heard the theory of infinite ads, where Meta can iterate countless variations to find what works. This sounds crazy and amazing and risky and scary all at the same time.

Forget the ad side for a moment. We're basically already there with this vision when it comes to campaign setup. Advantage+ Shopping Campaigns, which are now being replaced by Advantage+ Sales Campaigns, eliminated all the various customizations we were used to. No targeting. No manual placements. One ad set. Just let the algorithm do its work.

That part of campaign creation is already a reality, even if there are exceptions when customizations are necessary.

The big hurdle is the ads. This is where Meta loses me a bit because it's just so difficult to imagine. Meta claims it can generate copy and creative for limitless ads with minimal input. Maybe Meta has your pixel and customer data and knows a lot about your business already. Maybe you don't even need to provide the links, kind of like Dynamic Ads with a catalog, but on steroids.

But those ads are tightly structured based on the title, description, price, and image in the catalog. We're missing a lot of details. Meta would have to know your site and business well enough to generate everything. How does it do it? That’s the part that sounds crazy.

Think for a moment about how much we're already inviting AI to build our ads for us, but with supervision. Meta has AI-generated text recommendations now. I find these to be pretty bad and I never accept them. But Meta also rolled out a new branding feature that allows you to define the tone for AI-generated text. This is going to get better.

I know advertisers laugh at the possibility of automated everything because there are so many issues with Meta's AI-powered creative right now. But many of these same advertisers are using AI more than ever to create their ads, and I’m one of them. They're using ChatGPT and other tools to help brainstorm a marketing plan. They're having AI write ad text, or at least help. They're using AI to produce images and videos. And in some cases, those videos feature AI-generated characters.

So yes, we're already relying on AI more and more. But our input is still required. What Zuckerberg describes is a huge leap forward from where we are now. It assumes you provide very little information at all, and Meta will create your ads for you. Maybe infinite ads until it finds what works best.

Worst case scenario? The ad copy says something that's completely wrong. That could do major damage to your brand if you're not careful. And that’s the biggest obstacle. Brands have too much at risk for a campaign to be that simple.

Imagine a big brand like Nike, Pepsi, or Coca-Cola, with multiple levels of legal and approval and red tape. This couldn’t ever fly. They would require approvals before going live.

Maybe there’s some middle ground. Meta could generate all the ads with minimal input, and you approve each one before it’s published. You could upload brand standards and directions, kind of like a system prompt, and all the details needed to craft the ads.

This might be perfect for small businesses. They don’t have the money to hire an agency or the time to learn best practices. I can see this being the future of the Boost button. It may not be perfect, but it could be better than what most small businesses can do themselves.

That seems realistic. Maybe even likely.

While I have doubts about applying this to big brands, nothing Zuckerberg said is impossible. It would be unrealistic to suggest it could happen this year in any meaningful way. But five years from now? We've seen how much everything has changed in about two and a half years with AI. Would it be crazy to think this could be possible in another two and a half?

So what does this mean for ad agencies and the digital advertising industry?

I can’t sugarcoat it. It could turn it upside down.

I know the reaction: This isn’t possible. Advertisers are too important to every step of the campaign. But I hear many of those same complaints about automation today. Advertisers reject algorithmic targeting because they've tied their value to being able to find the ideal audience. But that’s rarely necessary anymore.

If you're going to tell me I can create infinite ads with minimal effort and the results would be better than doing it manually. Yeah, sign me up.

But if that's possible, what does an ad agency even do?

We've already known you shouldn't build your agency's value on targeting. And really, you shouldn't build it on much of what’s done in campaign and ad set construction. But now the question is whether you should even focus on ad creation.

Set aside your defensiveness. Plan accordingly.

Yes, this could potentially end your business. That's scary. But don't walk into this willfully ignorant.

Be flexible while focusing on the things that have the most long-term value. Ad creation and management have value right now. Positioning the product and offer has value. The landing page experience has value. Attribution and setup to measure results and optimize properly have value. Knowing the rules for your industry has value.

Bottom of the Glass

We don't know exactly what this will look like in three, four, or five years. But don't cover your ears and pretend you have no idea. Meta is telling us what they plan to do. Listen to them.

Advertising isn't the only industry that's going to be impacted by AI. Almost everything about how we do business is going to change — and I get it, that's scary.

My best advice? Be ahead of this trend.

An ad agency's role is going to change. But that doesn't mean it's going to disappear. Be the agency that knows how to use AI, not the one that tries to deny it exists.

Be ready to evolve.