Marketing Consulting Services NAICS 541613

Aug 19, 2025 - Advertising Industry Struggling to Catch Up to AI

• Few industries are being as completely transformed by technology as advertising, and AI adoption by agencies and clients alike is driving that transformation. So far big ad agencies have struggled to adapt to AI doing more and more of the creative heavy lifting. Technology has already taken over the distribution side of the business, with half of all US ad spend last year going to Google and Meta, and now AI could be coming for the rest. Tech companies including Snapchat, Pinterest, and Google have created AI tools for creating and editing advertising campaigns, increasingly pushing out agencies as companies cut ad spend and bring those duties in-house. Now agencies are pushing ahead to catch up - WPP is spending $400 million to develop AI tools to sell to customers, and rival Publicis is also investing in AI tech.
• Non-management jobs at US advertising agencies have declined 10% since the beginning of 2022, according to Live Data Technology, as the industry grapples with significant change brought on by AI adoption. Entry-level jobs are the hardest hit, as most of those creative tasks have largely been taken over by AI in what is an industry-wide shift to technology. Executive and director-level roles, however, have remained stable. Mentions of AI in global job listings for advertising and marketing companies increased 67% year over year, according to Autodesk. The trend has opened the door for independent ad shops and those backed by private equity to boost hiring to compensate and compete. Overall advertising industry employment is stuck in pre-pandemic levels at about 220,000 jobs - agencies are down 4% year over year in employment, well below its high of 280,000 roles in 2023.

• Employment was down but wages climbed in the marketing consulting industry in early 2025, reflecting advertising industry consolidation, a growing adoption of AI, and stagnant hiring. Employment fell 4.4% year over year in April 2025 and wages for non-supervisory employees rose 4.4% to an average of $44.15 per hour. The massive merger between ad giants Omnicom and Interpublic Group, which will be the world’s largest advertising company, is expected to control about 30% of the dollars among all media-buying agencies. The combined firm plans about $750 million in cost cutting, which will include headcount. Omnicom had already cut its US workforce by 11% in 2024, a loss of about 2,800 industry jobs. In addition, AI is taking over more of the heavy-lifting of research and creative services, reducing the need for headcount, and the industry is hiring more pre-MBA graduates who have lower starting salaries.
• With about 85% of US households now subscribing to at least one streaming service, per Statistica data, media buying is now firmly entrenched in a new era of advertising. The once dominant ad market of broad-based distribution through linear television and radio has given way to digital ad buys on streaming services that are more demographically targeted and provide advertisers with better data to track success. The move to streaming is also changing how ads are created, shifting away from a simple 30-second filmed spot to campaigns with more interactive features designed to engage the consumer, who is no longer a captive audience. Downsides of streaming ads include a highly fragmented audience, high cost depending on the streamer, and concerns about potential fraud and a lack of transparency about the audience being reached.