Solved: AI's impact on marketing value distribution

Hi there,

Thanks for reaching out! Really interesting points you've raised there. I've been seeing this from the sharp end of paid advertising for a while now, and it's definitely changing the game, but maybe not in the way most people think. Happy to give you some of my initial thoughts on it all from my perspective.

The short of it is, while everyone's getting excited about AI automating execution, they're missing the bigger picture. It's making the stuff that *actually* matters—deep customer insight, a killer offer, and a truly unique strategic angle—more valuable than ever before. Execution is becoming a commodity, but thinking is becoming priceless.

We'll need to look at what AI is actually good for...

You're spot on that clients are expecting things faster. The pressure is immense. Someone sees a competitor launch a campaign with a dozen different video ads and they immediately want the same, assuming it was all knocked up in an afternoon with a few prompts. The reality is a bit different. AI is fantastic at creating *variations*. If you have a solid, human-developed core concept, a strong message, and a clear visual direction, you can use AI to spit out hundreds of slightly different versions to test. Change the background, swap the spokesperson's shirt colour, rephrase a headline twenty different ways. It's an incredible tool for A/B testing at scale.

But here's the problem. Most people aren't using it like that. They're using it as a replacement for the initial creative thought process. They're typing in "create a video ad for my accounting software" and expecting magic. What they get back is a generic video of smiling people in an office, stock footage of charts going up, and a bland voiceover talking about "streamlining your workflows." We've all seen it. It's the visual equivalent of elevator music. It fills the space but nobody remembers it five seconds later.

The quality just isn't there yet for true, thumb-stopping creative. The visuals often have that weird, polished, slightly-off look. The copy lacks any real punch or empathy. It can't tell a compelling story because it's never felt a real emotion. So yes, you're right, we're seeing a massive increase in volume, but it's a volume of mediocre, forgettable content that's making everything look the same. In a world where everyone has an AI content machine, the only thing that stands out is genuine human creativity and insight. It's made a brilliant, original idea even more powerful because it's so much rarer now.

This shift from manual execution to automated output fundamentally changes where the value lies. If anyone can generate a hundred ad variations in an hour, the skill is no longer in the 'doing'. The skill is in the 'thinking' that comes before it: knowing *exactly* who you're talking to, what their deepest frustrations are, and what you can offer them that feels like a life-raft in a storm.

I'd say your ICP is a Nightmare, Not a Demographic...

This leads to the most important point. If everyone is pumping out generic content, the only way to cut through the noise is to be so ridiculously relevant to your ideal customer that they feel like you're reading their mind. And that's something AI is absolutely terrible at.

You need to forget the sterile, demographic-based profiles. "Companies in the finance sector with 50-200 employees" tells you precisely nothing of value. It's a lazy shortcut that leads to generic ads that speak to no one. To stop burning cash on ads that don't work, you have to define your customer not by who they are, but by the specific, urgent, expensive, career-threatening nightmare that keeps them awake at night.

Your ideal customer isn't a job title; they're a person in a specific state of pain. The Head of Sales at a tech startup isn't just a 'decision maker'; she's a leader staring at a sales dashboard that's flatlined, terrified she's going to miss her quarterly target and have to explain it to the board. The founder of an e-commerce brand isn't just an 'entrepreneur'; they're someone who just got a £10,000 bill from their ad agency with almost no sales to show for it, wondering if they'll have to lay off their first employee.

Your Ideal Customer Profile (ICP) isn't a person; it's a problem state. Once you've truly understood that nightmare, you can start building your entire marketing strategy around it. Where do these people go to find solutions? What niche podcasts do they listen to on their commute? What industry newsletters do they actually open and read? Who do they follow on LinkedIn or Twitter for advice? Are they members of specific Facebook groups or Slack communities?

This isn't just data; it's the blueprint for your targeting. It tells you exactly where to place your ads and, more importantly, what to say. An ad that starts with "Are you tired of unpredictable sales forecasts?" will hit that Head of Sales right between the eyes in a way that "The leading CRM for tech startups" never will. AI can't do this work for you because it requires empathy. It requires digging deep, talking to actual customers, and understanding the emotional context of their business challenges. If you don't do this work first, you have no business spending a single pound on ads, AI-assisted or not.

You probably should rethink the offer...

Even if you get the ICP nightmare right and craft the perfect message, your campaign can still fall flat at the final hurdle: the offer. This is the most common point of failure I see in almost every ad account I audit. People spend thousands on creative and media spend, only to send their perfect customer to a landing page with a "Request a Demo" button.

Let's be brutally honest. The "Request a Demo" button is the most arrogant Call to Action in marketing. It presumes that your prospect, a busy and important person whose problem you claim to understand, has nothing better to do than schedule a 30-minute meeting to be sold to. It's high-friction, it offers zero immediate value, and it instantly positions you as just another commodity vendor clamoring for their time. It's a massive ask.

In a world of AI-generated noise, your offer's only job is to deliver an "aha!" moment of undeniable value, right now. It has to solve a small part of their nightmare for free, to earn you the right to talk about solving the whole thing. It needs to make them sell themselves on your solution.

For SaaS companies, this is your superpower. The gold standard is a free trial (with no credit card required) or a generous freemium plan. Let them get their hands on the actual product. Let them experience the transformation firsthand. When the product itself proves its value, the sale becomes a simple formality. You're not generating Marketing Qualified Leads (MQLs) for a sales team to chase anymore; you're creating Product Qualified Leads (PQLs) who are already convinced and asking you how to pay.

But what if you're a service business? You're not exempt. You have to bottle your expertise into a tool, a piece of content, or an asset that provides instant value.

• -> For a marketing agency, this could be a free, automated website audit that uncovers their top 3 SEO opportunities.
• -> For a data analytics firm, a free 'Data Health Check' that flags critical issues in their database.
• -> For a corporate training company, a free 15-minute interactive video module on 'Handling Difficult Conversations' that a new manager can use immediately.

For us, as a paid ads consultancy, it’s a free 20-minute strategy session where we audit their failing ad campaigns and give them actionable advice on the spot. We solve a real problem for free. This builds trust and demonstrates expertise far more effectively than any sales pitch ever could. Your offer has to be as automated and low-friction as the AI tools you're using to create your content. If it's not, you're creating a massive bottleneck that will strangle your growth.

You'll need a message they can't ignore...

Once you have your nightmare ICP and your low-friction offer, you need to connect the two with a message they physically can't scroll past. This is where creative strategy comes in, and it's another area where human insight beats AI nine times out of ten. AI can string words together, but it can't craft a message that resonates on a deep emotional level.

You need to use proven copywriting frameworks that are built around the psychology of your customer's pain.

For a high-touch service business, you use Problem-Agitate-Solve (PAS). You don't sell "fractional CFO services"; you sell a good night's sleep.

• Problem: "Are your cash flow projections just a shot in the dark?"
• Agitate: "Are you one bad month away from a payroll crisis while your competitors are confidently raising their next round?"
• Solve: "Get expert financial strategy for a fraction of a full-time hire. We build dashboards that turn uncertainty into predictable growth."

For a B2B SaaS product, you use the Before-After-Bridge. You don't sell a "FinOps platform"; you sell the feeling of relief.

• Before: "Your AWS bill just arrived. It’s 30% higher than last month, and your engineers have no idea why. Another fire to put out."
• After: "Imagine opening your cloud bill and smiling. You see where every dollar is going and waste is automatically eliminated."
• Bridge: "Our platform is the bridge that gets you there. Start a free trial and find your first £1,000 in savings today."

These frameworks work because they mirror the customer's internal monologue. They start by acknowledging the pain they feel right now, amplify it slightly to create urgency, and then present your offer as the clear, obvious solution. An AI can be prompted to use these frameworks, but the output often feels robotic because it doesn't truly understand the nuances of the 'Agitate' or 'Before' state. It hasn't lived it. A human strategist who has spoken to dozens of CFOs will know the exact phrasing that triggers that knot in their stomach. That's the difference between copy that gets glanced at and copy that gets clicked.

We'll need to look at how this changes campaign strategy...

So, what does this all mean for the actual structure of a paid ad campaign? It means you have to stop thinking about AI as a content creator and start thinking of it as a hypothesis testing machine.

This brings me to a hard truth about platforms like Meta (Facebook/Instagram). When you set your campaign objective to "Reach" or "Brand Awareness," you're telling the algorithm to do one thing: "Find me the largest number of people for the lowest possible price." The algorithm, being incredibly efficient, does exactly that. It finds the users inside your targeting who are least likely to click, least likely to engage, and absolutely, positively least likely to ever buy anything. Why? Because their attention is cheap. No other advertiser wants them. You are literally paying the world's most powerful advertising machine to find you the worst possible audience for your product.

Stop doing this. The best form of brand awareness for any business that isn't Coca-Cola is a sale. It's a happy customer telling their friends. Awareness is a *byproduct* of effective, conversion-focused advertising, not a prerequisite for it. Every campaign you run should be optimised for a conversion event that is as close to revenue as possible—a lead, a free trial signup, a purchase.

So where does AI fit into this? You don't use it to generate 1,000 fluffy 'brand awareness' videos. You use it to rapidly test your strategic hypotheses.

• -> Hypothesis 1: "Our ICP is more motivated by fear of falling behind competitors than by the promise of efficiency gains." Let's use AI to create 10 ad variations of our PAS copy, each with a slightly different 'Agitate' angle focused on competitive pressure.
• -> Hypothesis 2: "A free 'Data Health Check' tool will convert better than our standard free trial for cold audiences." Let's use AI to create a set of visuals and headlines for a campaign promoting this new, low-friction offer.
• -> Hypothesis 3: "A user-generated style video from a 'customer' will outperform our polished corporate video." Let's use AI video tools to quickly mock up three different UGC-style scripts and visuals to test the concept before we invest in a full shoot.

This approach keeps the human strategist in the driver's seat, focused on the big questions. The AI becomes a powerful intern, executing the variations needed to get data back quickly. This is how hybrid creative/strategist roles will evolve. It's not about being a prompt engineer; it's about being a great marketer who knows how to use new tools to validate their ideas faster and more efficiently.

I'd say you need to understand the numbers that matter...

Finally, all this strategic work is useless if you're measuring the wrong things. The most dangerous question in marketing is "What's a good Cost Per Lead?" It's the wrong question because it's completely devoid of context. A £5 lead that never converts is infinitely more expensive than a £300 lead that becomes a £10,000 customer.

The real question isn't "How low can my CPL go?" but "How high a CPL can I afford to acquire a truly great customer?" The answer lies in its counterpart: Customer Lifetime Value (LTV). This is the metric that should guide every single decision you make about your ad spend. It's the North Star that AI-driven vanity metrics like 'reach' and 'impressions' only distract you from.

Calculating it is simpler than you might think. You need three numbers:

1. Average Revenue Per Account (ARPA): What do you make per customer, per month/year?
2. Gross Margin %: What's your profit margin on that revenue?
3. Monthly Churn Rate: What percentage of customers do you lose each month?

The formula is: LTV = (ARPA * Gross Margin %) / Monthly Churn Rate

For example, if your ARPA is £500, your gross margin is 80%, and your monthly churn is 4%, your LTV is (£500 * 0.80) / 0.04 = £10,000. Each customer is worth £10,000 in gross margin to your business over their lifetime.

Now you have the truth. A healthy business model often aims for a 3:1 LTV to Customer Acquisition Cost (CAC) ratio. With a £10,000 LTV, that means you can afford to spend up to £3,333 to acquire a single customer. If your sales process converts 1 in 10 qualified leads into a customer, you can afford to pay up to £333 for that qualified lead. Suddenly, that £250 lead from a perfectly targeted LinkedIn campaign doesn't seem expensive; it looks like a bargain. This is the maths that unlocks intelligent, aggressive growth and frees you from the tyranny of cheap, low-quality leads that AI-driven volume campaigns so often generate.

Use the calculator below to get a feel for your own numbers. It might just change the way you look at your entire marketing budget.

This is the main advice I have for you:

To wrap up, you're right to question what happens to value distribution. It's shifting dramatically. The value of manual, repetitive execution is plummeting towards zero. The value of deep strategic insight, empathy, creativity, and business acumen is skyrocketing. The future isn't about agencies being replaced by AI; it's about agencies that can't move beyond execution being replaced by agencies that can provide genuine strategic leadership.

The roles aren't just becoming hybrid creative/strategist positions; the best marketers are becoming part business consultant, part psychologist, and part scientist. They understand the numbers, they understand the customer's mind, and they use tools like AI to run experiments and find the truth faster than anyone else.

Getting this right is complicated, and it involves a fundamental shift in how you approach marketing. It can be a lot to handle on your own, especially when you're also trying to run a business. A lot of businesses find it helpful to work with an expert who has navigated this shift many times before and can provide an outside perspective on their strategy, ICP, and offer.

If you'd like to chat through your specific situation in more detail, we offer a completely free, no-obligation 20-minute strategy call where we can take a look at what you're doing now and give you some actionable advice. It could be a really valuable next step in figuring out how to navigate this new landscape.

Regards,

Team @ Lukas Holschuh