2024 Predictions: Agencies Shift to Solutions-Based Model, Embracing AI for Growth
Agencies in various industries are poised to undergo significant changes in their economic model as they shift towards a solutions-based approach, integrating AI technology to maximize growth potential. This transformation comes after a successful post-pandemic period that has seen agencies’ earnings return to pre-pandemic levels, while AI investments skyrocketed to an impressive $92 billion in 2022 and reached $50 to $60 billion year-to-date in 2023.
The next wave of growth heavily relies on agencies’ ability to adapt their traditional services-based model into one that revolves around delivering innovative solutions and products that combine creativity and technology. This shift will impact all agency types, including creative, media, PR, digital, and in-house agencies, as they leverage the power of artificial intelligence to augment human capabilities.
Contrary to the common notion that AI solely leads to employee displacement, the rise of generative AI offers an opportunity for agencies to enhance their workforce’s skill set. Forrester, a leading market research company, predicts that only 7.5% of agency roles will be automated by the end of the decade. Technologies such as robotic process automation, deep learning, computer vision, and intelligent automation have shown potential in automating approximately 25% of agency roles. However, the focus should be on augmenting employees’ abilities rather than replacing them.
By pairing people with AI platforms, agencies can strike the right balance between cost efficiency, an area of interest for marketers, and the amplified impact of human creativity that is further enhanced by AI’s capabilities. Similar to the negotiations between the Writers Guild of America (WGA) and major Hollywood studios, the creative industries must find ways to leverage efficiency and effectiveness while embracing AI technologies.
B2C marketers are urged to embrace the AI era now rather than later. As agencies experiment and progress with generative AI, harnessing its speed, intelligence, scale, and creativity becomes crucial to stay ahead of the competition. The year 2024 will witness both triumphs and challenges as marketing executives, agency leaders, procurement professionals, and technology providers work together to commercialize AI capabilities and expedite agencies’ transformation.
In conclusion, the agency landscape is undergoing a significant shift towards a solutions-based model that integrates AI technology for exponential growth. Agencies should seize the opportunity to leverage generative AI, its ability to augment human capabilities, and its potential in delivering efficient and impactful solutions. B2C marketers are particularly encouraged to embrace the AI era, leveraging the power of speed, intelligence, scale, and creativity that AI offers. As the industry continues to evolve, agencies that strike the right balance between technology and human creativity will emerge as leaders in the new era of advertising.