Tastes Great, Less Filling? Report On Meta Plan For Cheaper, Fully AI-Made Ads Boosts Tech Giant's Stock As Media Agency Shares Slump
Meta Platforms is reportedly planning to deliver advertising creative materials produced entirely with AI, a move that would deliver significant cost savings to ad buyers and shake up the overall marketplace.
The Wall Street Journal report on the initiative sent Meta stock up 3% and dragged down shares in ad agency giants WPP, Omnicom and Interpublic between 2% and 4% apiece.
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Meta founder and CEO Mark Zuckerberg has long cited AI as a core strategic objective, recently outlining plans to spend hundreds of billions of dollars on developing large-language models like Llama. Advertising, which is the tech firm's primary source of revenue, could also be transformed.
An unidentified source told the Journal that the set-up would allow brands to present images of products it wants to promote, along with budgetary goals. AI tools would then create the entire ad, including imagery, video and text, at a considerable savings. A high degree of personalization would let brands determine subsets of Meta's billions of users across Instagram and Facebook would receive the spots. Further customization features would allow a brand campaign to be broken down into finer targets.
The news builds on a pattern over the past several years, with ad spending moving from traditional media to digital and social.
Zuckerberg addressed Meta's broader commitment to using AI to enhance ad capabilities during the company's annual shareholder meeting last week.
'In the not-too-distant future, we want to get to a world where any business will be able to just tell us what objective they're trying to achieve, like selling something or getting a new customer, how much they're willing to pay for each result, and connect their bank account and then we just do the rest for them,' the CEO said.
Even if Meta makes good on its projections to build a full-AI system, a number of advertisers will likely pause before fully committing. While social media has vacuumed up an increasing share of brands' overall spending, ad buyers frequently have to reassess when their create appears next to objectionable content, something that has happened with regularity. Given the laissez-faire shift across tech and government over the past couple of years, conditions could be setting up for another cycle of retrenchment.
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