Ad agencies are ready to put AI to work

Ad agencies are moving fast and spending big to be some of AI’s early adopters.

What happened: Publicis Groupe, one of the world’s biggest advertising and communications holding companies, announced a €300 million AI investment over the next three years. That includes building Core AI, its own platform for creating and targeting ads, as well as adjusting strategies in real-time.

• Features include “consultant-level intelligence” to come up with marketing strategies, as well as personalizing content for individual audiences.
  
  
• It will also optimize ad targeting, something agencies are concerned about being able to do after Google phases out third-party cookies.
  
  
• Tech division Publicis Sapient helped Nvidia design the chips that trained ChatGPT. That relationship helped it secure its own supply of chips custom-made for Core AI.

Why it matters: For all the talk that generative AI has received for its ability to create things, its ability to find connections between different data points is also something that ad agencies are willing to spend big on. But it could possibly creep out consumers.

• Publicis has pointed to data division Epsilon as a growth driver over the years. It is also one of several firms that has faced scrutiny for data buying and selling practices.
  
  
• Among the data Core AI will use are 2.3 billion profiles of people around the world that Publicis owns, along with customer data owned by its clients.
  
  
• Core AI can also make applications customized to clients, with safeguards to keep their data contained. But that is less of a privacy feature and more of a way to make sure a company isn’t using an AI trained on data owned by a competitor.

In Canada: Across the many agencies it owns, Publicis clients in Canada include (deep breath) Canadian Tire, Rogers, Bell, TD Bank, Procter & Gamble, Heineken, Sephora, Visa, Kellogg’s, Starbucks, GMC, and Pizza Hut.

Zoom out: Rival holding companies have made their own investments in AI, but unlike Publicis building Core AI itself, they have typically partnered with outside companies.