As Holding companies and independents alike are collectively investing billions in architecture, tools and processes that leverage AI in ways that go far beyond simple machine learning, the technology is creating efficiencies across all corners of the media business. Speaking to Digiday, Omnicom Media Group CEO Florian Adamski addressed the potential impact on agency compensation models – and at what point clients will start asking for the efficiencies to translate to reduced fees.
“Frankly, if you believe you have the luxury of waiting for clients to ask about AI-driven compensation models, you might already be behind the curve,” said Adamski. There are two types of clients — the ones that will ask and the ones that will take matters into their own hands. As an agency leader you’re not in a great position if you don’t start the conversation with either category as there might be a tendency to start viewing agency outputs as commodities, not strategic value.””
While noting that the impact of generative AI on remuneration between agency and client is leading both down the road toward outcomes, Digiday acknowledges the challenge of changing long-established practices. To Adamski’s thinking, that problem can be solved — in fact it needs to be, given the pressures on clients to show growth.
“Clients feel the cost pressure every single day. AI is more than just a cost cutter – it can help to reallocate investment to where it drives incremental results which is a win for both sides,” he said. “Preparing clients for value-based conversations rather than time-spent ones is what creates an opportunity to evolve into a higher-value partner … Being open to explore outcomes-based compensation models now is a sound approach.””