The New Creative Code — How GenAI is Reshaping Industry Giants
Observatory International, has released its latest whitepaper: The New Creative Code — How GenAI is Reshaping Industry Giants. The report captures a moment in time where AI is not just influencing the marketing landscape but redefining its foundations.
The world’s biggest agency groups are in an AI arms race — slashing costs, speeding up delivery, and redefining how creativity happens. But Observatory International’s new report warns that behind the tech headlines lies a critical human story — one of shifting roles, skill gaps, and the risk that new entrants to the industry are at risk of bypassing some of the essential learning and understanding the fundamentals of their craft.
Following an extensive review during Q4 2024 of leading communications holding companies and networks including WPP, Publicis, Havas, IPG, Omnicom, Brandtech, and .Monks, the report provides deep insights into how these industry giants are adapting, investing, and innovating with AI.
Key Findings:
- Exponential Growth: Major holding companies are investing billions in AI, with Publicis committing €300 million, WPP £250 million annually, and Omnicom’s $13.25 billion merger with IPG signalling industry-wide acceleration.
- Efficiency Gains: Agencies report up to a 55% faster speed to market, 50% reductions in production costs, and double-digit increases in sales and engagement through AI-driven processes.
- Shift from ‘WOW’ to ‘HOW’: While 2023 marvelled at GenAI’s potential, 2024 is focused on practical deployment, and 2025 is anticipated to be the year of operational reality.
- Creativity and Caution: While AI optimises content production, human creativity remains irreplaceable for brand authenticity, strategic insights and nuance.
- Urgency in Governance and Education: The absence of a robust regulatory framework underscores the need for clear governance policies, data integrity measures, and widespread AI literacy across agencies and clients.
Christine Downton, Managing Partner of Observatory International London, stated: “We’re witnessing the most significant creative revolution in modern marketing. The question is not whether brands will adopt AI — but how intelligently and responsibly they will do so.”
The report also highlights challenges, including procurement barriers, the environmental footprint of AI technology, and the need for new remuneration models based on output and value rather than time and resources. As well as a concern that training and processes need to be in place to ensure that new recruits to the marketing communications industry need to know and understand the fundamentals of their craft.
For agencies and brands alike, the message is clear: AI will not replace humans — but humans equipped with AI will outpace those without.
