Google and Meta, which already dominate the buying and selling of digital advertising, are using generative AI to handle more of the creative development -- the foundation upon which Madison Avenue's largest agencies were built.

"In the coming years, AI will be able to generate creative for advertisers as well, and will also be able to personalize it as people see it," Meta CEO Mark Zuckerberg said during an investor call earlier this year. "Over the long term, advertisers will basically just be able to tell us a business objective and a budget, and we're going to go do the rest for them."

Meta, which works with millions of small businesses, said in September that more than a million advertisers have used its generative AI ad tools and created 15 million ads with the technology over the prior month.

Brands such as Coca-Cola, Toys "R" Us, L'Oréal and Mars are rushing to experiment.

Mondelez, the maker of Oreo, Ritz Crackers and Sour Patch Kids, is working with Google, Accenture and Publicis's tech consulting arm, Sapient, to build an AI platform to improve the performance of its marketing. Mondelez is allocating $100 million to this three-year initiative, aiming to save 20% on agency fees and production costs -- approximately $40 million.

"Generative AI is revolutionizing the creative process," said Jonathan Halvorson, Mondelez's global senior vice president of consumer experience.

Mondelez and its agencies have spent more than a year training AI models with historical ad and marketing content, from logo designs to food photography styled to make products like chocolate chips appear irresistibly delicious. It is currently developing ads using generative AI for its Chips Ahoy cookie brand that feature its cookie-mascot Chip.

Ad development for Chips Ahoy historically relied on weeks of brainstorming sessions, manual storyboarding, design iterations and then animation. The entire process would take at least three months. Mondelez believes using AI in creative development can cut that down to a few weeks.

It recently used the technology to create a storyboard for its Belgium chocolate brand Côte d'Or in just three days, work that otherwise would have taken three weeks. The two-dozen frames progress from images of a woman backstage at a comedy club to a close-up of an elephant and then a herd running in the savanna. Returning backstage, a glass of water tumbles, then a nut splashes into chocolate and an elephant-logo Côte d'Or bar snaps into pieces.

"Whether we like it or not, the 'Mad Men' era is receding in our rearview mirror while we drive at full speed into the age of the 'Math Men and Women,'" said Jon Miller, a digital-media veteran and Interpublic board member.

Write to Suzanne Vranica at Suzanne.Vranica@wsj.com

(END) Dow Jones Newswires

December 13, 2024 21:00 ET (02:00 GMT)

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