Could Meta's automated ad creation end traditional agency models?

A brand executive uploads a single product image, sets their marketing budget, and within minutes, a fully-fledged advertising campaign is created, targeted, and ready to launch; all without human intervention. This is Meta's vision for the future of advertising, and it's sending ripples of concern throughout the traditional marketing industry.

The social media giant is developing AI tools that aim to fundamentally change how brands approach advertising, allowing them to create and target campaigns using nothing more than AI by the end of next year, as per a report by the Wall Street Journal. As Mark Zuckerberg boldly described, this future could require "no creative, no targeting demographic, no measurement", and this has advertising agencies questioning their very existence.

This shift comes at a time when marketing budgets are already under pressure. According to Gartner's 2025 CMO Spend Survey, marketing budgets have remained stagnant for a second consecutive year at 7.7% of total company revenue. 

The timing couldn't be more pressing. As marketers grapple with budget constraints and efficiency demands, many have already turned to AI tools and reduced labour expenditure to maintain profitability. Now, Meta's ambitious plans threaten to bypass agencies entirely, leading to staggering financial implications.

Global corporate spending on AI is projected to reach $200 billion by 2025, and Meta is positioning itself to get big bucks. The platform has updated its spending outlook for the coming year, with a plan to invest between $64 billion and $72 billion in capital expenditure, and a significant portion dedicated to building AI infrastructure.

Meanwhile, established advertising giants are scrambling to keep pace. For example, Publicis is investing approximately $325 million over three years in AI technology, while WPP has committed to spending $318 million annually on AI. Traditional agencies are increasingly allocating resources from people-powered services to technology-driven solutions.

While huge network agencies have the resources to turn towards AI, will smaller agencies go out of business?

Adaptation over elimination

The agency world isn't accepting this disruption passively. They are reshaping their strategies to remain relevant in this landscape. Swati Nathani, Co-Founder and Chief Business Officer, Team Pumpkin, notes that her agency is shifting focus from executional tasks to strategic consulting, creative brand storytelling, and holistic campaign orchestration; areas where human insight and contextual understanding still matter.

"Meta's push toward fully automated AI-powered ad creation does pose a real risk of disintermediation for agencies, particularly with small and mid-size brands that may be drawn to the promise of lower costs and simplicity," Nathani explains. Her team is investing in upskilling their workforce in AI literacy, positioning themselves as guides who can help clients leverage these tools effectively while ensuring they remain indispensable partners in an increasingly automated landscape.

Vivek Kumar Anand, Chief Strategy Officer at DViO Digital, on the other hand, argues that the platform's advancement isn't threatening good creative work; it's exposing lazy practices that have persisted too long in the industry.

Anand states, “If an agency is still charging to resize creatives, tweak targeting, or export reports, then Meta isn’t the threat. Redundancy is.”

But this doesn’t mean small or mid-size clients don’t need agencies. It means they don’t need execution vendors, according to Anand. 

“What they need is someone who sees around corners. Someone who can tell them how to differentiate, and where to play before the platform swallows their budget and also what not to automate.”

His agency is keeping downstream operations lean, automated, and AI-first, while focusing human talent on strategic thinking and cultural insights that machines cannot replicate.

Justifying human expertise in an AI world

While AI can’t replace human intelligence, the implications for creative work present a fascinating paradox. On one hand, AI democratises advertising creation, allowing brands the speed and scale required to produce content. On the other hand, this efficiency may come at the cost of originality and brand differentiation.

Anand is concerned that AI content trained on the same datasets and optimised for the same click-through rate metrics could lead to what he calls "a sea of sameness." This homogenisation is a challenge and an opportunity for agencies willing to inject originality.

The Indian market provides evidence of AI's potential. According to Adobe's 2025 AI and Digital Trends India snapshot, Indian businesses are at the forefront of generative AI adoption. Nearly a quarter of businesses in India are demonstrating results from generative AI, the highest figure in the APAC region. For business, the advantages include greater volume and speed of content ideation and production (73%) and increased productivity and efficiency (67%).

Sahil Chopra, Founder and CEO of iCubesWire, views this as validation of a balanced approach to AI integration. "Tools like Meta AI are going to make it super easy for brands, especially emerging brands, to not only create full-fledged campaigns but also manage them," Chopra observes. 

However, he argues that AI cannot understand the nuances of a brand's voice or values that come from the real people behind a brand. The key to survival, he suggests, is adapting to become strategic partners rather than just execution arms, focusing on positioning, storytelling, and long-term growth.

However, as AI-generated content becomes faster and cheaper through platforms like Meta, agencies face a fundamental challenge: how do they justify their value, especially to cost-sensitive clients?

Soumabha Nandi, EVP - Creative Strategy & Growth, Social Panga, notes, "Agencies bring in nuances and contexts. Agencies will also be more tailored. So I see no substitution happening."

He thinks that creativity isn’t dead; it’s evolving, and people will value it more in the days to come.

"Less Photoshop and more prompts is just a new way of working. But it is still work humans need to do," Nandi continues.

Chopra echoes this statement. 

According to him, "AI is not a threat. It can generate a hundred ads within seconds, but it still needs direction. And the output can be as creative and fresh as the direction." The key is supporting clients while demonstrating what AI misses: context, quality, and differentiation. 

Anand further argues that integrating AI capabilities has become non-negotiable for every agency. However, he notes, "Platforms are great at reproducing what's already known. The real value lies in spotting what isn't. Judgment on where culture is heading before the data shows it. That's the real value and where the winning agencies will play."

How agency roles will change 

The transformation isn't just about what agencies do; it's about how they are structured and compensated. Team Pumpkin’s Nathani's team is already experiencing this shift, with roles evolving from manual execution to insight generation, creative direction, and strategic consulting. 

This operational shift is driving changes in business models as well. As automation reduces manual production work, agencies are pivoting from traditional retainers to performance-linked and consultative models. Future compensation will increasingly be tied to strategic input, creative innovation, and business impact rather than just execution volume.

"The future agency will be less about volume and more about value creation in partnership with clients," Nathani predicts.

Social Panga's Nandi has a pragmatic response to this and says that there's no point romanticising it. 

"AI is already ghosting some departments. What survives? Taste. Judgment. Storytelling. And people who know when to say, “That’s a terrible idea, even if the data loves it.” Tasks are automated; taste is not," he continues.

However, despite the rapid advancement of AI capabilities, certain aspects of advertising work remain fundamentally human. The question isn't whether AI will eliminate jobs, but which roles and skills will remain indispensable as the industry evolves.

Anand believes, "AI is excellent at answers. It's terrible at better questions. So the irreplaceable functions aren't titles. They're instincts.”

As per him, who sees the cultural ripple before the trend report, reframes the brief so it's worth solving, has the uncomfortable conversation with the client that saves a campaign will win. The focus shouldn't be on protecting existing roles but on evolving them to emphasise human capabilities.

Chopra identifies specific functions that will remain resilient, including strategy, creative direction, and brand building. These areas require judgment, empathy, and big-picture thinking that remain difficult to automate. 

This includes account strategy, creative leadership, cultural insights, and brand tone-of-voice development, all requiring human perspective and understanding.

Even in media planning, knowing where to show up and why requires a human read of the market that goes beyond algorithmic optimisation. The key is encouraging teams to lean into work where their perspective matters.

This extends beyond operational changes to shifts in how agencies structure their businesses and generate revenue. The traditional model built around production-heavy retainers is giving way to more flexible, value-driven approaches.

Nandi comments that there are new models being explored, including how VCs get paid. "There will be more changes. There will be models like consultative, performance-linked, and even co-investing in outcomes. It’s a shift, but a healthy one."

Chopra acknowledges that retainers built around long production timelines won't disappear entirely. 

He notes that some clients will always value long-term relationships over speed. However, the definition of performance must evolve beyond simple metrics like clicks to reflect brand growth, loyalty, and genuine engagement.

Agencies need to position themselves as advisors, creators, and collaborators rather than just service providers.

As Meta's AI tools move from development to deployment, the technology aims to democratise ad creation, potentially reducing costs and increasing speed for brands. However, this efficiency comes with trade-offs that forward-thinking agencies are positioning themselves to address.

The future landscape will likely feature a hybrid model where AI handles routine tasks and basic campaign mechanics, while human expertise focuses on strategy, creativity, and brand differentiation. The agencies that thrive will be those that double down on what machines cannot offer: strategic thinking, integrated campaign planning, and creativity tailored to each brand's unique context.

Having already conquered digital ad distribution and search-driven targeting, Meta is now coming for the very act of ad creation itself. If successful, this leaves agencies with no choice but to evolve, or be outpaced by the platform they once relied on. 

 

 

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