David Patton: why AI will break advertising unless creativity Is priced properly
Advertising used to operate in a world where both thinking and making were expensive. Strategy development was a slow, detailed process and ambitious creative production required time, people and capital. In that context, bundling creative judgement and execution into a single commercial model worked well enough. Inefficiencies were absorbed by healthy agency margins and quality of output generally correlated with perceived client value.
AI has fundamentally changed that context and, in doing so, has challenged the economics of the entire advertising ecosystem by collapsing the cost of execution. Content variants, formats, localisation, adaptation and optimisation can now be produced at near-zero marginal cost. What once required large agency teams, time and significant budgets can today be delivered instantly and repeatedly.
This shift is now creating friction across the entire advertising eco-system.
Client procurement teams are responding exactly as efficient supply chains do. When execution becomes cheaper and more scalable, they expect unit costs to fall and transparency to increase. At the same time, marketing teams still expect originality, differentiation and creative leadership. Agencies are caught between these two pressure-points, asked to deliver more value while being paid less for the work that actually determines outcomes.
The friction arises because advertising still prices creativity and execution as if they were the same activity.
When AI applies automation logic to a bundled commercial model, procurement pressure is applied across the entire fee structure. Creative judgement, which has not become cheaper, faster, or more predictable, is unintentionally pulled into a commodity pricing framework designed for production. What procurement sees as efficiency, marketing experiences as dilution and agencies as margin erosion.
AI has exposed a structural flaw that was previously hidden. Advertising never properly separated creative judgement from delivery. Other professional services industries solved this long ago. Law and accountancy recognised that senior judgement carries risk and must be priced independently from execution effort. Advertising did not, because until now it did not need to.
Defining the problem, choosing a creative direction, interpreting culture and making decisions under uncertainty remain high-risk acts. Getting them right reduces downstream waste and complexity. Getting them wrong multiplies cost through rework, inconsistency and strategic drift. Treating that judgement as a commodity does not reduce risk. It increases it, while also intensifying tension between functions.
This is why clearly separating and valuing investment in human creativity from production is now in everyone’s collective interest.
For CMOs, it protects the decisions that drive brand growth and relevance in a world flooded with sameness. For procurement, it creates clean scopes, clearer accountability and genuine cost control where scale actually sits. For advertising agencies, it restores responsibility and credibility by paying for creative judgement and holding it accountable. For finance, it reduces total cost of ownership by preventing decisions being endlessly revisited downstream.
This is not about slowing AI adoption or defending legacy models.
It is about updating commercial logic to match a new economic reality. The longer creative judgement and production remain bundled, the greater the friction, waste and erosion of value. The opportunity is to redesign the model collaboratively, before efficiency gains harden into structural conflict and quietly undermine creative effectiveness.
David Patton has held senior positions at Jellyfish Pictures, The Mill, Y&R, Grey (both WPP) and Sony Europe.
