Google’s AI technology, he added, “improves both productivity and creativity, freeing people up to focus on work that adds the most value”.
The agencies present represented hundreds of millions of dollars in annual billings on behalf of big brands and government entities. They included News Corp-owned News Xtend, XPON, Sparro, Atomic 212°, Incubeta, Digital Minds Group, Webprofits and Havas Media. After The Australian Financial Review inquired about the dinner, Google contacted agencies asking them for positive takeaways.
AI – the technology that closest simulates human intelligence – has become an indispensable part of many business functions over the past few years. The risks and opportunities it poses to the ad industry are enormous.
An IMF discussion paper on AI growth underlined how it differs from previous technological revolutions because higher-income earners now find themselves at risk of displacement.
“AI challenges the belief that technology affects mainly middle and, in some cases, low-skill jobs: its advanced algorithms can now augment or replace high-skill roles previously thought immune to automation,” the IMF wrote. “Even high-skill occupations, which were previously considered immune to automation because of their complexity and reliance on deep expertise now face potential disruption.”
Google is uniquely dominant in the global advertising ecosystem. Brands spend millions promoting their websites and products in search results, buy display ads on websites, ads around YouTube (which Google owns), and listings for individual products on Google’s shopping tab.
It is both the platform where companies spend their money to reach customers, and the software that makes it all possible. It made $8.4 billion in Australia in the 2022 calendar year, $7.1 billion of which was from advertising, according to its latest corporate filings.
In 2021, the Australian Competition and Consumer Commission found Google was “dominating the supply chain of ad tech services”, touching more than 90 per cent of all ads viewed by Australians.
“Over more than a decade, Google’s vertical integration and strength in ad tech services has allowed it to engage in a range of conduct which has lessened competition over time and entrenched its dominant position,” the ACCC wrote.
Its dominance stands in 2024, giving Google an authoritative position as a key trading partner for ad agencies.
Those with knowledge of the meetings said Google regularly talks to agencies, and such dinners are held twice a year to discuss trends in the industry. Google’s response to inquiries included three statements from agency executives at the dinner.
“The message I took from the event is how AI tools can be put to use by our agency in the best way to create additional value and growth opportunities for us, and the customers we serve,” Atomic 212°’s James Dixon said.
Webprofits’ chief operating officer, Catherine Dix, said Google’s presentation was “around how agencies should be thinking about AI, the value they offer, and how to innovate and convey that value”.
