Thanks to generative AI, advertising’s business models will be reinvented

Agencies must embrace the opportunity to transform their revenue model. Value-based pricing could be a good option.

Advertising and disruptive technologies. In many ways, you can’t have one without the other. In past years, disruptive technology meant programmatic media buying, SEO, and mobile. Today, it means artificial intelligence— more specifically, generative AI. Brands and consumers expect the industry to remain two steps ahead of the digital curve and while AI is not new to the industry, generative AI has caused many agencies to shift priorities and the way they operate. In 2024, it will be more about augmentation, not automation.

In a soon-to-be-published paper by the 4As and the ANA on agency compensation, agencies and marketers are encouraged to embrace experimentation. Begin with smaller projects or engagements to test and learn from. Be prepared for setbacks, as they often yield valuable insights that can guide the journey toward more effective practices.

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