January 25, 2023
Sarah Fay On Ad Industry AI: 'Don't Do Nothing'
- by Joe Mandese @mp_joemandese, July 12, 2022
Long-time agency media chief turned venture capitalist Sarah Fay wants the ad industry to accelerate its embrace of artificial intelligence -- and it’s not just because her VC firm, Glasswing Ventures, specializes in it, but because the technology is accelerating so fast that advertisers and agencies can’t afford to sit on the sidelines and wait for AI to mature.
“The important thing is don’t do nothing,” Fay said during one of investment banker Madison Alley’s “executive lounge” webinars late last week, adding: “Because if you don’t start adopting technologies for the way you are running your operations and your business, you’re going to turn around and find yourself very much behind.”
Fay, whose firm includes a number of advertising, marketing and media-related AI startups within its portfolio, described how one of them -- Elsy -- utilizes AI to automate the media-planning process, doing in hours what it might take a human media planner weeks or even months to manage.
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“I’m not saying you just let the machine do the work,” Fay explained, adding, “There’s usually a planner testing assumptions and making changes, but it’s a really helpful framework for a planner to work with and get the answer within hours, rather than weeks.
“I would say, if your competitor is using Elsy and you're still doing it the old way, you’re going to be left in the dust.”
Fay, a former CEO of Dentsu’s Carat and Isobar units, and currently the chairman of Ziff Davis’ board of directors, gave a number of examples for automating marketing and media processes via AI, while keeping the “human in the loop” in order to ensure that AI is actually beneficial intelligence that benefits not just a brand, but its consumers as well.
She was joined by fellow former Madison Avenue media guru – Rishad Tobaccowala – who also sung the praises of AI transforming marketing, including “creative,” which he said is actually being embraced by agency creative executives.
“To a great extent AI will be like electricity. We won’t be able to do without it,” Tobaccowala asserted, adding, “But on the other hand, electricity alone doesn’t differentiate. It’s how you use it.”
2 comments about "Sarah Fay On Ad Industry AI: 'Don't Do Nothing'".
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Ms. Fay, my question has to do with Return on Investment, (ROI) in AI. AI is not simple nor cheap as a investment for any company. I agree many companies would benefit from AI. However, a company can easily spend too much and not get the return they expect.
What is a point a company should consider the AI investment be a positive one?
An AI system, however clever, that is not directly integrated with downstream workflow systems is dissociated from reality and therefore a largely useless rube goldberg machine. Having a system to create scenarios absent of business rules, booking and measurement data is like running your business on reports (or graphs) that are out of date as you render them. The only way to overcome this reality is for the AI system to be intimately integrated into the transaction workflow at strategic junctures with specifically defined business objectives. Finding people with the business knowledge and technical expertise to build such systems is almost impossible. A much better solution is to buy this capability from a vendor with a proven track record and installed client base. The ROI is known, and the results are deterministic. Trying to build one from the ground-up is quixotic.
Importantly, the overall message of Ms. Fay is valid, AI is essential as the complexity of Omnichannel planning is way beyond the capabilities, experience and training of a single channel media specialist. There is a lot of money being left on the table that AI is finding.