AI Disruption in Advertising: Cannes Lions Festival Highlights Industry Transformation

Madison Avenue Braces for the AI Apocalypse

A New Studio Bets That It Can Level Up Creators and Independent Filmmakers (Exclusive) Is the advertising industry staring down its "let them eat cake" moment? Thousands of media and tech executives are descending on France for the annual Cannes Lions festival (June 16 to 20), where they will schmooze and sip Aperol Spritzes at parties, and perhaps commiserate in between panels at Meta or Spotify Beach, or on one of the dozens of yachts docked in the harbor. The talk of the town is what one veteran media exec frames as the "insane chaos and disruption" that AI is beginning to unleash as the major ad agencies and buying firms slash thousands of jobs in the name of automation and consolidation. It already is being felt at the very top of the industry: Just days before the Cannes Lions kickoff, WPP CEO Mark Read revealed his intention to depart at year's end, reassuring staff that "we are now leading the way as AI transforms marketing" and that the company is equipped "to face the future confidently and capture the opportunities ahead." And Omnicom and IPG are lurching toward a $13 billion megamerger, which is premised on creating an ad giant that will be "poised to accelerate innovation and harness the significant opportunities created by new technologies in this era of exponential change," as Omnicom CEO John Wren said when unveiling the deal. That exponential change, ad agency veterans say, is based on a few things: The practice of buying and selling, which was once hashed out in smoke-filled rooms and at glitzy events, is already increasingly automated, and AI will only turbocharge that as potential AI agents tasked with creating full media plans are deployed. On the creative side, AI will dramatically change the creation of ads themselves. Meta, for example, wants to have AI tech in the market allowing brands to create, target and deploy ads by the end of next year. Across the industry, tools are being developed that allow brands to upload images of their product, which can be quickly iterated into dozens of ads or video spots. The end result is a business that could be radically smaller. "I'm afraid that in a couple of years, the big ad agencies will be a shadow of what they are today," admits the former CEO of a top Madison Avenue firm. "Nothing can match human creativity and experience, but from research to placement to creative, a lot of what the agencies have done can be replicated pretty well by AI." Not everyone agrees that the end is near. And that includes Alex Schultz, the CMO of Meta. "We believe AI will enable agencies and advertisers to focus precious time and resources on the creativity that matters. And we're seeing agencies using AI in a way that is aligned with this vision already," Schultz wrote on LinkedIn last month. "Advertisers, including our marketing teams at Meta, also rely on their agencies to make decisions across channels and across platforms. While we think there will ultimately be more automation in marketing, the role that agencies play is going to become ever more important through their ability to plan, execute and measure across platforms." Still, the AI revolution is coming. Last year, Coca-Cola released an ad created using generative AI tools, and in June, the prediction market Kalshi placed an ad during the NBA Finals (on the YouTube TV stream, at least) that was created entirely using Veo 3, Google's new video generation model. Thomas Iljic, the product lead at Google Labs responsible for Veo 3, tells The Hollywood Reporter that when it comes to using the tech for advertising, it "seems extremely promising, but I would say it's still very early in terms of gauging the size of the market." While the ad business will face the brunt of disruption first, the media business writ large will have to grapple with the consequences -- and what comes next. Everyone in Hollywood is aware of the threat that generative AI poses to production, but less focus has been placed on the disruption to processes. Meta and Google dominate digital ads, and when Amazon is added in, the three companies gobble up more than 60 percent of all ad dollars (excluding China), per Magna, and analysts see the potential for AI to further entrench the tech giants. "A key risk we see for smaller platforms is the further entrenchment of large-scale platforms and the inability to compete on scale of capital, engineering resources and [first person] data," Goldman Sachs' Eric Sheridan wrote May 7. Streaming services are among those smaller platforms, serving up digital ads to consumers. Tech giants have a "very different cost model, and it's allowed them to plow revenue into AI, into ad targeting, into tech areas where I think traditional media is just slower to innovate," says Kate Scott-Dawkins at WPP Media. But traditional media is giving it a go. Major media companies have already reorganized themselves to enable more automated ad buying and transacting, with data-heavy approaches, targeting, and guarantees. The scatter market that used to take place over games of phone tag now happens automatically in custom software. As the digital giants roll out more AI-driven ad options, streamers and publishers will have no choice but to follow. Of course, some streamers are already thinking about the looming disruption. At this year's upfront, both Netflix and Amazon unveiled AI-powered ad formats, that use the tech to blend an existing ad to whatever content the viewer is watching. TikTok unveiled its own AI ad format at Cannes Lions this week. Others will follow. But entertainment giants do have an ace up their sleeve: For major ad deals involving top brands, the human touch is likely to remain, and with live sports still among the most valuable content on the planet, those deals are unlikely to dissipate anytime soon. One ad sales exec predicts that companies will create more big, tailored bundles for clients that use sports as a hub, with other content like news and entertainment as spokes that can support it, and automated ad buying at the outer rim, more tailored to on-demand entertainment fare. But the not-too-distant future also carries with it enormous uncertainty around what content consumers will be watching, where they watch it, how ads are sold and consumed, and other big picture questions that would have seemed like science fiction not long ago. Creator-driven platforms like YouTube, Instagram and TikTok have disrupted the consumption of content, and the creation of content, and AI could further fragment that world. "I think what maybe people aren't ready for, is what happens with the explosion of machine generated content or AI generated content, and to what extent do these platforms allow that to flourish," Scott-Dawkins says. "To what extent do they try and tamp that down to keep the sort of authentic, person-driven narrative that they've had with users historically?" YouTube CEO Neal Mohan, for example, took to the stage at Cannes Wednesday to announce that Veo 3 would be added to its Shorts platform later this summer, enabling easier, faster use of the Google AI tool. "The possibilities with AI are limitless," Mohan said. "A lot can change in a generation. Entertainment itself has changed more in the last two decades than any other time in history. Creators led this revolution." For what it's worth, one top tech exec says that while AI content on user-generated platforms is inevitable, human creativity is still likely to be what people engage with most, though it may be augmented by AI tools. The future of ads will likely be similar. "Consumers already expect advertising to be relevant and engaging and buying experiences to be seamless; those expectations are only going to accelerate in the age of AI," WPP Media CEO Brian Lesser said May 28 in connection with the launch of the company. Or as Apple vp Tor Myhren declared at a Cannes Lions event this week: "The good news is AI is not going to kill advertising. The bad news is AI is not going to save advertising. We've got to save ourselves, by believing in what's always made this industry special: human creativity." So it goes that perhaps it is the art of buying and selling ads that may itself by supplanted by AI, even if humans retain some semblance of creative control. JPMorgan analyst David Karnofsky, in a June 9 report, outlined discussions with media buyers who describe "a Minority Report-esque world where advertising is personalized through virtual reality, digital, and physical media. Consumers may start to outsource purchasing decisions to AI agents (which we are already seeing in the clothing industry with Stitch Fix)." However even in that world outlined by JPMorgan where science fiction becomes reality, there is a silver lining for old-fashioned advertising. "In this scenario, media buyers highlighted that AI buyers may understand a consumer's goals, budget, habits, and use that information to make decisions on your behalf and communicate with AI sellers -- however, advertising would still play an important role in providing information that prompts consumers to highlight and update their goals/ instructions for their AI agents," Karnofsky writes. No need to call that 1-800 number or visit that website, just tell your AI agent about that AI-created Super Bowl ad, and it will do the rest.

Creatives, meet your new colleague: AI | Advertising | Campaign India

It works nights, weekends and doesn't bill by the hour. Should the creative fraternity be worried much? As he wraps up his shortlisting jury duties for Cannes Lions 2025, Arnab Ray, executive creative director at Landor India, reflects on what makes work award-worthy. "The difference between good and unforgettable lies in how deeply an idea resonates, how boldly it's executed, and how clearly it connects to culture. These are the three evergreen criteria," he says. Citing Matthias Spaetgens, Industry Craft Jury President at Cannes Lions, Ray adds, "If the work makes you feel jealous -- makes you exclaim, 'I wish I had done that!' -- then it's sure to go the distance." He believes the biggest wins at Cannes Lions International Festival of Creativity don't just impress; they shift perspective. Behind these lies smart strategy, originality, flawless craft, and cultural relevance. And therein lies the human edge. Even as AI floods workflows with speed and scale, professionals argue that it can't mimic instinct, cultural fluency or emotionally resonant storytelling. Yet, it's forcing a profound rethink of how agencies structure themselves, pitch work, and define value. Sam Altman, the OpenAI overlord behind ChatGPT, offered a bombshell prediction a few weeks ago, which could make every strategist, planner and creative director break into a nervous scroll. In Our AI Journey, a book penned by Adam Brotman and Andy Sack of Forum3, the techpreneur didn't pull punches when asked what artificial general intelligence (AGI) might do to marketing. His answer? Picture agencies and brand teams being outsourced -- not to a rival agency, but to a silicon-brained assistant that works faster, cheaper, and claims zero credit. According to Altman, future AI will be able to whip up campaign ideas, craft visuals and scripts, and run simulated focus groups for feedback -- all in real time, all for free, and all before you've had your morning espresso. "Images, videos, campaign ideas? No problem," he says. It's a bit like having an in-house team of award-winning creatives, strategists and data analysts -- minus the snack budget. When AI eats marketing While this may sound dramatic, it is not as far-fetched as many might want to believe. Altman's version of the near future is one where AI doesn't just assist with marketing -- it devours most of it, leaving humans to either reinvent their roles or risk being relegated to applauding the algorithms. So, should agencies panic? Not quite. But it might be time to stop treating AI like an intern and start seeing it as a power player. "AI is changing the game, but it still needs smart humans behind it," says Santosh Kumar, COO at Innocean. His agency launched its AI Labs over a year ago to move beyond hype and create agile workflows powered by AI. Now, tech and data teams work closely with creative leads, incorporating prompt writing, LLM training, and even agentic AI. According to the IAB's State of Data report released in March 2025, 30% of agencies, brands, and publishers have already embedded AI into their entire media campaign processes. Interestingly, agencies and publishers are outpacing brands in embracing AI, leveraging it largely to enhance operational efficiency. The IAB forecasts that the rise of generative and agentic AI is poised to transform the full spectrum of media campaign activities -- spanning planning, delivery, and performance measurement. That has meant rethinking hiring. Infectious co-founder Nisha Singhania says they now seek hybrid profiles: "strategists who code, writers who think like UX designers, and creatives who understand prompt engineering." AI, she argues, is not a threat but a collaborator -- one that frees up people to focus on cultural thinking and narrative design. For Upasana Dua, executive strategy director at Landor India, the shift is foundational. "Agencies that fail to proactively integrate and master AI capabilities risk not just competitive disadvantage, but obsolescence," she says. Her wishlist of future skillsets includes creative technologists who can translate insights into AI-powered campaigns, as well as behavioural scientists who can infuse those campaigns with emotional insight. "Their expertise in human emotion, motivation, and nuanced connection can ensure that the most impactful narratives are not merely conveyed, but deeply experienced." Into the new era AI is also changing the creative pitch. Agencies now walk into meetings armed with animated prototypes, voiceovers, and concept films rendered by synthetic media. "We've moved from static decks to immersive, AI-assisted storytelling," says Singhania. "Indian clients, especially digital-first brands, are receptive and often excited." Senior brand strategist Riddhima Chaturvedi agrees. "Some clients, especially those that are inclined towards tech, love it, while the others are taking time to accept this evolution. But overall, it's a big shift where agencies can show ideas instead of just explaining them," she notes. At many agencies, pitches now involve AI-generated manifestos and experiential prototypes. "Pitches are an exciting opportunity since one isn't quite restricted by 'mandatories' just yet," Dua points out. Yet Indian clients tread cautiously. They are intrigued by AI-led storytelling, but concerned about authenticity, deepfakes and erosion of human creativity. The automation of execution also calls into question traditional billing models. Chaturvedi admits that AI is reducing manual work. So, clients are naturally questioning retainer models. A bit of both In response, Indian agencies are experimenting with hybrid models that combine subscription-based AI tools with strategic consulting. Project-based pricing and outcome-driven contracts are also becoming more common. Yet not all see a retreat from retainers. "Clients know the value of having an agency on retainer," says Singhania. "They don't just pay for output but also consumer understanding and strategic thinking, which only an agency on record can invest in." Kumar echoes that sentiment. "AI helps us move faster and automate tasks, but the focus stays on solving business problems with the right mix of tech and talent," he says. AI isn't just a production tool; it's becoming core to strategic creativity. Dua cites examples from Landor's work on Nestle's Milo and Tata's Agratas. In the former, AI helped map experiential spaces; in the latter, employees could generate personalised logos to reflect agile workflows. These are stories told at speed, with nuance and depth. Singhania adds, "We're using AI not just to make content but to shape strategy -- analysing audience sentiment, cultural shifts, even subcultures emerging online." Chaturvedi believes AI is enabling not just faster campaigns, but smarter, more culturally relevant ones. It helps agencies tap into real-time trends, emotions, and behaviours. Innocean's Kumar says, "Campaigns like Cadbury's SRK My Store are great examples of how AI can build cultural love while solving business problems. That's the real shift -- from clicks to connection." This move toward micro-audience engagement is reshaping strategy. "We moved from thinking in terms of 'one big TVC' to orchestrating modular campaigns," says Singhania. With AI, planning begins not with media weights but narrative architecture. Metrics, too, are shifting: resonance, shareability and community impact trump impressions. Kumar sees hyperlocal campaigns as a sign of things to come. "AI is pushing us from mass messaging to precision. With Meta aiming for full AI automation by 2026, we're heading into a future of fully personalised campaigns." Cadbury Bournvita's 'D for Dreams' campaign -- conceptualised by Ogilvy -- aimed to get children back on the cricket pitch and into the sunlight. Last year, the chocolate malt drink offered kids a chance to be trained by veteran cricketer and former Indian team coach Rahul Dravid. The campaign utilised QR codes and AI to connect children with this opportunity with an ad film highlighting the role of vitamin D and underscored the importance of outdoor activity while Dravid shared key batting techniques. Dua, however, cautions against over-segmentation. "The metrics that truly matter are mass relevance, not simply mass reach. Every variation must reinforce core brand values." As AI commoditises production, the differentiator becomes emotional intelligence. Variations may be AI-generated, but the idea needs to be human intuition-based. Experiential storytelling and cultural sharpness will define standout work. "Clients want partners who solve real problems, who think beyond formats and platforms," says Kumar. His agency is evolving into a business solutions firm, fusing creativity, tech and data. Singhania concurs. In an age where execution is instant, she emphasises that originality, empathy, and cultural sharpness become the true differentiators. In her opinion, the best agencies won't just make ads -- they'll help brands build meaning. Ray, having seen the best in global creative work, sums it up: true impact lives beyond execution. It's rooted in resonance, cultural intelligence, and the kind of creativity that no prompt can fake. In India, as agencies pivot structurally and strategically, the challenge is no longer just about how fast or well AI can deliver. It's about whether the work still makes you wish you'd done it yourself.