Next in Media: Emily and Mike Talk AI in Media Buying, Agency Layoffs, and Trade Desk Bounceback

Release Date: May 13, 2025
Host: Mike Shields
Guest: Emily Riley, Consultant to the Ad Tech Universe and Former Analyst

Introduction

In the latest episode of Next in Media, host Mike Shields welcomes his regular guest, Emily Riley, a seasoned consultant in the ad tech industry. The episode dives deep into the evolving landscape of media buying, the impact of artificial intelligence (AI) on the advertising ecosystem, recent agency layoffs, and the surprising resurgence of The Trade Desk.

Ad Tech Earnings: The Trade Desk's Surprising Bounce Back

The conversation kicks off with a discussion on recent ad tech earnings, particularly focusing on The Trade Desk and Applovin. Emily Riley highlights the unexpected positive performance of The Trade Desk, countering the prevailing "gloom and doom" sentiment in the industry.

Emily Riley [00:52]: "When they came out beating expectations, you look at what they said did well. Honestly, it's the stuff that they've been building towards for a while, including Open Path, which is a more direct buying opportunity."

Mike Shields acknowledges the significance of this turnaround, noting that The Trade Desk's success may indicate a broader shift in the media buying landscape.

The Trade Desk as a Market Bellwether

Emily elaborates on why The Trade Desk's performance is significant, emphasizing its reliance on large agency buyers compared to giants like Google, Meta, and Amazon, which draw revenue from smaller advertisers.

Emily Riley [02:19]: "If you look at Google or Meta, a huge part of their revenue is coming from these much smaller advertisers. The Trade Desk, most of the revenue comes from big agency buyers..."

Mike concurs, suggesting that The Trade Desk's stability may not necessarily reflect the broader market but still serves as a valuable indicator.

Current Business Climate: Resilience Amid Uncertainty

Despite economic pressures and potential price hikes in various sectors, Mike notes that ad spend from clients remains robust, with no immediate signs of significant budget cuts.

Mike Shields [03:29]: "I've been waiting and I'm not hearing that. It's just a lot of 'we have to proceed with business.' I haven't gotten the scary call yet from the client to cut everything."

Emily adds that while there's currently a buying frenzy, it's unsustainable in the long term as prices begin to rise.

Emily Riley [03:29]: "People are kind of in a buying frenzy. It's not going to last, but you're going to see the prices go up."

Agency Dynamics and the Rise of AI

The discussion shifts to recent changes within major agencies, including Group M's rebranding to WPP Media and ensuing layoffs. Emily questions whether AI is being leveraged as a scapegoat for reducing workforce or if genuine technological advancements are at play.

Mike Shields [05:12]: "I wonder if it's a great excuse right now to use AI or say we're doing this because of AI or the market then just get smaller or is something going on here?"

Emily delves into the concept of agentic AI, which refers to AI systems capable of making autonomous decisions in media buying.

Emily Riley [08:00]: "Agentic AI is basically humans just let the AI go and let it make decisions on its own, like booking media buys and setting price points."

She raises concerns about the reliability of such systems, especially in handling complex, high-stakes advertising campaigns.

The Double-Edged Sword of AI in Ad Tech

Emily discusses the challenges posed by AI, including the phenomenon of AI hallucinations—instances where AI generates incorrect or misleading information.

Emily Riley [09:49]: "AI hallucinations are getting way worse. Up to 25% of the time, AI gets things wrong, like misgendering users in targeted ads."

This highlights the risks of fully automating media buying without human oversight, as mistakes can compound and lead to ineffective or even harmful advertising strategies.

Mike reflects on the balance between AI efficiency and the necessity of human relationships in the advertising industry.

Mike Shields [06:44]: "Technology will make media buying more efficient, but you will be losing the power of relationships with the biggest money part of the market. That's dangerous."

The Future of Media Buying and Connected TV (CTV)

The conversation moves to the rise of Connected TV (CTV) and its role in democratizing media buying. Emily explains how major tech companies, including Samsung, LG, and Vizio, are developing their own CTV buying platforms to make advertising more accessible to smaller brands.

Emily Riley [14:10]: "They have self-service tools to make it easier and are hoping that CTV becomes democratized, unlocking access to new advertisers beyond the top 300 brands."

Mike notes that while platforms like YouTube have advanced in democratized buying, major sports events and flagship content deals continue to drive significant advertising conversations.

Mike Shields [16:16]: "Super Bowl, FA World Cup, exclusive streaming deals are driving more of the conversation in the market than the long tail."

The New Search Frontier and Advertising

In the latter part of the episode, Mike brings up the evolving landscape of search and advertising, referencing the transition towards conversational and answer-driven search. Emily shares insights on how platforms like OpenAI are venturing into advertising, challenging traditional models.

She recounts an anecdote about Facebook's initial resistance to advertising, highlighting the perennial tension between user experience and monetization.

Emily Riley [19:22]: "Mark Zuckerberg initially said they don't believe in advertising, but six months later, ads became a crucial revenue stream."

The duo discusses the complexities of integrating advertising into new search paradigms, such as ensuring relevance without compromising user trust.

Conclusion

The episode wraps up with a reflection on the transformative impact of AI on media buying and advertising. While technological advancements promise greater efficiency and democratization, they also introduce challenges related to transparency, reliability, and the preservation of human relationships in the industry.

Mike Shields [20:51]: "Everybody's trying to decide what this whole brave new world is going to look like."

Emily and Mike agree that while the future holds exciting possibilities, it requires careful navigation to balance innovation with the foundational elements that have traditionally driven successful advertising strategies.

Key Takeaways:

• The Trade Desk's Resilience: Despite market skepticism, The Trade Desk outperformed expectations, signaling potential shifts in media buying trends.

• AI's Growing Influence: The rise of agentic AI offers efficiency but poses risks related to accuracy and the erosion of human-centric relationships in advertising.

• Democratization through CTV: Connected TV platforms are lowering entry barriers for smaller advertisers, potentially reshaping the advertising landscape.

• Evolving Search and Advertising: The integration of advertising into conversational and answer-driven search models represents a significant shift, requiring new strategies and considerations.

This episode provides a comprehensive overview of the current state and future directions of the media, marketing, and advertising industries, underscored by the transformative role of technology and AI.