Month: January 2023

How much appetite there is for generative AI in marketing depends on who you ask, but agencies say many clients are curious to experiment; others are only seeing a trickle of interest. (Earlier this week, Mint Mobile released a new ad starring Ryan Reynolds that was written using ChatGPT.)

Among the agency execs bullish on ChatGPT is Mark Himmelsbach, founding partner of the creative agency Episode Four. Despite its current limitations, he believes ChatGPT can help foster divergent thinking, adding that the agency has already used the platform for writing client briefs and strategy work.

“The amount of lateral thinking that ChatGPT can provide is an incredible starting point for creativity,” Himmelsbach said. “It still needs that human touch. We say that ideas can come from anywhere, but have to be honed by a few.”

Even before reports of Microsoft’s potential investment, OpenAI was seen by some as a potential threat to Google’s longtime dominance in search. Just last week, the companies were reportedly planning to integrate ChatGPT into Bing’s search engine. And in October, Microsoft itself announced plans to integrate DALL-E 2 into various consumer apps and services including Bing’s Image Creator. Meanwhile, the ad-free search startup Neeva also announced its own AI capabilities that don’t use ChatGPT.

Whether the startup could help Microsoft gain more market share is still a big question. OpenAI’s ability to bring new relevance to Bing would be an unexpected turnaround, said Erik Hamilton, VP of social and search at the independent media agency Good Apple. However, he said it’s typically startups — not giants — that disrupt other giants: “Are we going to see people flocking towards Bing? I think that would be a stunning reversal of how the internet has functioned.”

The applications of ChatGPT when it comes to paid advertising still are all hypothetical, but some see a potential that goes even further. For example, marketers would likely pay “sky high” prices if ChatGPT creates a way to show images and text about products based on whatever a user is inquiring about, said Hamilton. Even before OpenAI is integrated into search, it might be used to help marketers write blog posts based on high-demand keywords.

“Google’s right to quake in their boots a little bit,” Hamilton said. “But if they’re going to lose market share, it’s not going to be for a long time.”

ChatGPT could also be helpful for customer service operations, said Fergal Reid, director of machine learning at Intercom. For example, it could help customer service agencies better answer questions, as well as answer them in more creative ways. The company has been developing its own bot technology that doesn’t use ChatGPT. However, Reid said the top challenge with developing their own bots has been what he describes as “hallucinations” — when an AI doesn’t have an answer to something and instead tries to come up with something plausible that might not be right.

“The real magic comes when we look at this and really reevaluate what capabilities are new,” he said. “But then we get used to this stuff as a building block… We learn what it’s really great at, what are its strengths.”

Integrating with OpenAI could give Microsoft new advantages across various platforms such as Bing and various Office 365 products, according to Oliver Dore, partner at the design firm Work & Co. And even while it’s still early, he thinks generative AI is here to stay, especially as it evolves and expands.

However, there are still major limitations, added Dore. For example, the data sets are generalized and therefore not optimized for certain contexts — which could become a brand safety concern in some cases. Not too unlike the “hallucinations” Reid referred to.

The acceleration of content creation also creates new concerns related to the proliferation of misinformation. Justin Davis, co-founder and CEO of Spectrum Labs — which uses AI to detect and mitigate harmful content — said a big question with an open source platform like OpenAI will be who has access to the tools and who decides how it can be used.

“It is a dual-purpose tech,” Davis said. “If you don’t monitor [and] control — have the right governance, policy or compliance — in the way you give access to these tools to everyone and anyone on the internet, that’s where it starts to get really tricky.”

In doing so, the retailer wants to be more agile in creating content for internal teams as well as external communications. By having in-house employees handle copywriting, art direction, graphic design, video and broadcast production for meetings, events, digital communication and co-worker communication, the company believes it can have more consistency in its tone of voice as well as test out new formats faster. 

“It’s the first months, it’s mainly internal content but the ambition is that [the Ingka Content Factory work] does go into different channels, little by little,” said Frau Uriarte. “We’ve started slow and we’ll scale to see what’s relevant for the end users… Customer expectations and demands are greater than ever. The biggest risk is to stand still.”

Ikea is one of a number of brands including Sony, Coca-Cola and more building out in-house capabilities in recent years. Having more control — whether that’s of media spending or brand voice or whatever else it may be — has been a main driver for many brands in building out in-house capabilities, as previously reported by Digiday. Given the current economic climate, there has been a resurgence of interest in in-housing efforts by brands as they seek to find cost-cutting and more control once again.

Having the Ingka Content Factory create content for the company’s employees is part of the company’s “post-catalog era” plan for communications, explained Frau Uriarte. “Our co-workers are our biggest brand ambassadors and supporters,” she said. “To have coworkers engaged, aware, supporting and being creators of content [helps our brand]. One of the biggest movements I’d like to do in communication is raise the voices of coworkers. Communication for all and by all.”

Finding ways to bolster in-house capabilities makes sense to David Novak, co-head of marketing and sales at brand consultancy Prophet. The move “follows a trend we’re seeing where consumer product brands and retailers see the need for rapid content development,” said Novak. “They’ve got a lot of products and promotions that are changing rapidly and need explaining internally for store planning and employees.” 

In building out an in-house team to manage that content Ikea is able to move with “speed and familiarity,” per Novak who added that aside from content moving in-house brands are seeking more control of web development and analytics. 

Aside from the in-house agency, Ikea is also evolving its retail format. The chain is testing out smaller format stores in cities like San Francisco, Copenhagen and London to allow for more shoppers in urban dwellings to access the store. At the same time, the company is updating its digital experience as well, offering AI personalization to help consumers imagine the retailer’s products in their homes. 

“We’re continuing to transform ourselves,” said Frau Uriarte. “We want to be at the high level of agility and adaptability.”

When the Reuters Institute for the Study of Journalism asked over 300 media leaders where they will be investing more resources this year, 72% said they will be focusing on podcasts and digital audio, more than any other category, according to the annual “Journalism, Media, and Technology Trends and Predictions 2023” report released on Jan. 10.

Podcast team contraction

Since December 2020, podcast job openings hit its peak in May of last year, according to job posting site Indeed. In May 2022, there were 442 jobs with the word “podcast” in the job description, compared to 262 jobs in December 2020 (per 1 million total jobs). But last summer, podcast job openings declined, reaching 307 in December 2022. The largest month-to-month drop was from June to July, from 416 to 343 jobs. Jobs with “podcast” in the title on Indeed’s site also declined last year, from a peak of 21 jobs in May 2022 to 14 jobs in December.

Reports by Bloomberg and Vulture also mention a contraction among podcast teams, especially at big organizations like SiriusXM, Spotify (and its Gimlet Media and Parcast studios), Acast, CNN and NPR. 

Companies that have gone through recent layoffs seem to be taking a cautious approach. Insider and Vice Media Group do not have any audio or podcast job openings at this time, according to their job portals. CNN has one job opening for its podcast arm on its portal, but it is a senior-level one: an audio executive producer with a wide salary range of $183,000 to $340,700.

David Spiegel, CRO at Betches Media called the slew of investments in podcasting over the last couple of years a “spending spree.”

“The reality is, none of that is really returning the investment that they needed… interest rates are up, the economy is slightly uncertain, the ad market is a little shaky,” Spiegel said. “So yeah, maybe we shouldn’t go out and spend $200 million on something… It’s like a sign of the times that these businesses have to be a little bit smarter, which I think everyone has to be in times of economic certainty.”

“There is a stark difference and always will be between companies that do podcasting unprofitably and those that do… 2023 will put a sharp focus on those companies that are driving earnings,” added Conal Byrne, CEO of the iHeartMedia Digital Audio Group. (In Q3 2022, iHeart’s Digital Audio Group revenue was $254 million, up 23% year-over-year and its podcast revenue was $91 million, up 42% year-over-year. Adjusted EBITDA for the group grew 17% to $78,317 for the quarter.)

But publishers still see opportunity for podcast growth 

iHeartMedia is still hiring, according to Byrne.

When asked about recent reports on the contraction in the podcast space, Byrne said, “We scratch our heads a little bit at those reports. It feels completely, entirely different from our reality,” Byrne said. “No hiring slowdown. Still on pace to grow and support the growth,” he added.

Smaller media companies are also continuing to plan for growth this year: Tenderfoot TV hired six new people in the last three months, including producers, editors, marketing and research employees, said president and co-founder Donald Albright. He plans to hire one to two more people in the next couple months. Tenderfoot and another media company (whose executive agreed to share this information on the condition of anonymity) have plans to double their podcast output this year; the executive at the latter company said they will also be hiring more staff to accommodate for those new shows.

“We don’t plan on slowing down,” said Albright.

A number of media companies posted new podcast job openings this month. Vox Media, for example, posted a job opening this week for a $200,000+ ​​executive producer position for its daily show “Today Explained.”

Legacy publishers like The New York Times and The Wall Street Journal are also growing their audio teams. This week, the Times announced seven new hires, mostly staffing up its flagship show “The Daily.” A new audio programming team was created in December to work on the Times’ new audio app. Two people working on Opinion Audio shows were promoted last month to develop and launch new shows.

This past week, The New York Times posted a development editor job for Serial Productions, the podcast production company it acquired in 2020, to develop new shows. The Times also posted a producer job for “The Run Up,” the politics show it resurrected to cover the lead-up to the midterms last year, to lead the show towards the 2024 presidential election.

The Wall Street Journal recently posted job openings for a head of news audio (the salary range is notably $140,000 to $450,000), an executive producer to manage a team working to develop, launch and produce weekly feature podcasts and deeply reported, narrative series, an audio host/producer to develop and launch a new weekly interview podcast series, as well as a number of other audio producer roles.