New business consultants have seen a rise in the use of AI overpromising during pitches in the Australian market. It is occurring across holding companies and indies in both media and creative reviews, often focused on efficiency and cost reduction rather than effectiveness.
B&T spoke to several consultants in the wake of Publicis Groupe global chief executive Arthur Sadoun bemoaning the use of AI overpromises to win pitches.
Publicis Groupe released a video ahead of the Cannes Lions Festival of Creativity, which B&T understands was created using AI technology, that calls out ‘the wrong promises’, such as a holding company offering a client a $5 million bonus if it adopts their AI platform, reducing the cost of agency headcount by 80 per cent or not having to pay an agency until they won their first Cannes Lion.
“The compound effect of overpromising on AI and unsustainable commercial offers in pitches to generate headlines is leading to massive jobs cuts in our industry,” Sadoun said in a press release.
“Collectively, we have to stop this race to the bottom and reaffirm our unique ability to deliver what clients really want: love for their brands, growth they can see, success they can measure. That’s why Publicis’ sessions in Cannes will demonstrate that the only pitch promise that counts is business results.”
‘AI promises a lever to cut costs’
B&T wanted to find out whether Sadoun’s concerns are legitimate, and whether AI promises are being used to win pitches in this market.
Peter Coffey, a partner and project director at Enth Degree said he hasn’t noticed AI being pushed as much by agencies in the creative space.
“My feeling is that they want to use AI behind the scenes but maintain the same headcount, having resources charged across multiple accounts,” Coffey said.
“From a media perspective, we do see AI used from a planning perspective, which of course begs the question from clients (and us) as to why a full strategy team is needed if a campaign is just run through a computer program.”
Jen Davidson, the founder and managing partner of Tumbleturn, has noticed an uptick of AI overpromises in this market.
“There is definitely an emphasis on AI solutions across the industry across both media and creative agencies. But it tends to be pitch commitments on how AI can be a lever for lower costs and greater efficiencies,” she said.
“Creativity and strategic ideas driven by talented people still trumps any productivity gains from AI.”
In investigating the issue, B&T has heard cases of clients approaching their suppliers during contract renewals to see how AI is being used to drive efficiencies for their business, and encouraging agencies to use AI to drive cost efficiencies that could be passed back to them, rather than the agencies retaining the benefits.
AI’s expanding the opportunity
Overpromises in pitches are as old as the process of choosing advertising agencies itself. There have long been stories about advertising luminaries walking into a pitch with a novelty $2 million cheque telling a client that’s how much would save them in the first year, agencies offering to work for the first year for free, or provide their senior team on speed dial.
“What we’re seeing now is lots of promises, like we can do your production for 70 per cent less with no proof or substantiation on how that’ll be achieved other than AI,” argues TrinityP3 founder and global CEO Darren Woolley. “And it’s not just holding companies.”
“What worries me is that most of the promises are about productivity improvement. There’s very few that are saying this about improving effectiveness or improving quality, they’re all talking about speed to market and cost reduction.”
Woolley said that although overpromising has “been around forever”, it’s gotten worse recently and expanded by “the promise of AI”.
Too often, he adds, promises aren’t delivered and marketers are left in an awkward position where they cannot turn around and fire their agency for fear , and they are stuck with them (at the expense of trust) until they go to market again.
Woolley, who points out that overpromising doesn’t occur in the majority of cases, the “agencies that play hard, play really hard”.
“Let the buyer beware. Procurement and marketers have a responsibility for due diligence and corporate governance,” he added, noting that procurement squeezing agency and media rates can often lead to overpromising.
“Whatever the agency offers, they need to validate and put in place at least a mechanism to ensure that that promise will be delivered.”
