With AI ad tools expanding, Meta courts agencies while reshaping their role

**Kamika McCoy** (0:06)
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Hello, hello, and welcome to another episode of The Digiday Podcast. I'm your cohost, Kamika McCoy, Senior Marketing Reporter here at Digiday, coming to you live from this year's Cannes Lion International Festival of Creativity in the South of France. We're coming to the end of this year's festival, and if you've made it this far, congratulations. A lot of this year's conversation has been big beachside announcements and claims about AI as always, but one thing that's becoming pretty clear is that AI is everywhere, especially in how ads are built, how they're bought, how they're measured, and the growing question around where that leaves the agency role. If you want a full rundown of everything that's been coming out of CAN, Digiday's obviously got you covered. We've got a newsletter coming out every day. If you haven't checked it out, please be sure to do so.
In this episode, I'm talking to Nicola Mendelsohn from Meta. She's head of global business group, and we talked about how Meta is leaning further into automation and AI with ad business, but they're trying to do so in a way that doesn't necessarily get out the ad agency or the whole co-row. So without further ado.

**Nicola Mendelsohn** (1:52)
Welcome to the show. Oh, thank you so much. I'm absolutely delighted to be here with you.

**Kamika McCoy** (1:56)
What can is this for you?

**Nicola Mendelsohn** (1:58)
This is Can 23, I think. 23 years of coming here. 13 with Meta, and before that, it was 20 years plus in advertising.

**Kamika McCoy** (2:07)
Oh my goodness, so you've seen a lot change. But I would also imagine that you've seen a lot change within Meta's own ad business, which is what we're here to talk to you about today.
A couple years ago, I was reporting that Apple had privacy changes and there was the rise of TikTok, and there was all this tumultuation happening. And the question was, what is Meta going to do now that this space is starting to get crowded? Today, Meta has really solidified itself as an ad business, and it's even per eMarketer on track to surpass Google's ad business. Talk to me a little bit about what's changed.

**Nicola Mendelsohn** (2:40)
Wow, there's a lot of questions in there. But I think the main thing has changed is the fact that we've been working with AI for the business side well over a decade. We use the models to service the right content to people that are using our platforms. So the fact that more than three and a half billion people are utilizing our platforms every single month, every single day, actually, is an extraordinary thing because we're giving them the information that they want to see the content that they love. So that part of the business is very strong, where the people actually are. And then we're also using it to ensure that we're serving the right ads to the right people at the right time. And we built a whole new system, actually, called the Advantage Plus system.
And in that, it helps to do better targeting, better personalization, better creative, better shopping, if that's the thing that you're looking to do. And that's at the heart of it. And we just announced today, the new research from the University of Berkeley is showing that for every dollar that is invested in the US by an advertiser, they're seeing on average a $4.13 back in return on ad spend. So this is a huge number.
And that's because we're also investing heavily in the generative AI tools. We're seeing more than 8 million advertisers are now embracing those tools. We had a whole load of new announcements around that area as well that were enabling people to build on the success that we're already doing. So every bit of the business that we have, we have AI that touches it in some way. And more and more, what we're focusing on is how we can make it easier for our advertisers to be able to run campaigns at scale, find people they didn't know that they could with new and exciting creative work as well.

**Kamika McCoy** (4:21)
Absolutely. Now, given that you managed the relationship with marketers and advertisers, how does that then show up in the conversations that you're having with them?