AI and the future of marketing agencies

Speaker A: If you feel like you've done everything right but still find it impossible to grow, you have to check out our latest masterclass at, uh, Kinship Co Free. Kinship Co Free. I'm sharing the exact system we use to help our clients scale profitably. It's not theory. These are actionable strategies that you can start implementing right away. Sign up for free at Kinship Co Free and see you there. Today, I'm jumping right in because the thing I want to talk about today is something I think most agencies and the brands that are hiring agencies are about to get very wrong. And the uncomfortable truth, and we all know this, is that I, ah, can now write a recommendation about as well as most marketers can. It'll pull the data or read the account, tell you what it would do, and it'll do it competently, and it'll do it in about three or four seconds. Right? So I want to answer the question that should be keeping every founder really, whether brand agency up at night, if the machine can recommend, what are you actually paying a human? Inform. And I'll tell you up front, this is not a doom episode. There's enough of that out in the marketplace already. It's actually the opposite, I think the more AI automates, the more valuable the right humans become, but only really the right ones doing the right thing at the right time. So by the end of this, you're going to know exactly where the value lives and how, uh, specifically we're building kinship around it and what you can take from it, whether you're a brand or, or you run an agency yourself. Let's dive in. So if you've been around the show you've heard me talk about and do a whole episode on why people should hire an agency, why you ultimately hire one, the short version is because I think it's the foundation for a lot of what we're going to talk about is, you know, people don't hire kinship to run their Facebook ads. They can get execution anywhere now, right? Freelancers, tools in house AI. So what they're actually paying for is strong opinions, strategic counsel, and then ultimately backed up by execution. The way that I would define an agency is a business that uses its wealth of knowledge and experience earned across a lot of different clients, to guide and execute toward an outcome that's good in the near term and in the long term. So guide and execute. Both words matter. And I think that's the whole separator, right? Like a consultant hands you ideas and ultimately walks away the buck, doesn't stop with them. So they're strategy and no execution. A freelancer execute exactly what you tell them, nothing really more. So there's execution. There's not really a point of view. An agency, I think is supposed to do both. Uh, it's the strategic brain and the hands. There's a line that I keep coming back to. Done is not always beautiful. You can check the box, ship the thing, complete the task, and still completely miss the mark because there is no point of view behind it. There's not a point of view on the right thing to do at the right time. A quick story that made this click for me is when we were hiring a partner to build something for us, the thing that I wanted most, the thing that I was actually paying for, was for them to look at me and say, no, that's a stupid idea. Do this instead. I didn't want an order taker. I wanted people who do this all day, every day to walk in with enough authority that they could equip me to make the right call, right? So I think of the way, you know, the president and the cabinet is supposed to work, right? Like the founder, you are the president. You make the final call. It's your company, it's your money. But a good president has a cabinet of people who know their domain cold and walk in it so well prepared that the president can actually decide well, and that's ultimately our job as an agency is to be the Cabinet. I think here's the part a single in house hire or a tool can't replicate is when a beauty brand hires us. Part of what they're buying is that we work with five other beauty brands, right? We can say, hey, here's what's actually working right now, this month for a brand that looks like you. Different price point, sure, but the same customer. Ultimately, at the macro level, they're buying beauty products from a macro level. That pattern is something that literally you cannot get inside of one company. Why does this matter? Okay, so that's the case for an agency in normal times, right? But let's talk about why this gets more important, not less, as AI gets better. Because I've been reading two pieces lately that I'll put in the show. Notes from completely different angles that are making the same argument. And I think every brand and every operator needs to actually sit with it. And I think the first one is an essay by Alex Imess. I might be mispronouncing his last name, but called what Will Be Scarce. His core point is really simple as AI makes production cheap. The kind of Thing that is scarce changes. So when execution gets cheaper and cheaper, the human element is what goes up in value. He gives an example of Starbucks. The short version of that example is that he tells it is that they leaned into automation, they took away all the baristas and ultimately decided it was a mistake and brought the baristas back. Because the human touch is what actually drove the customer satisfaction, not just the throughput, right? And this isn't surprising probably to most of you, but ultimately his point is that as people get richer, as they make even not necessarily fast, but they get more and more money, the money flows towards things where the human being is actually part of the value. So think of service based businesses, you know, as you get wealthier and wealthier, you pay for people to do things for you. So it is that human touch that was the kind of, the first essay is just like as production gets cheaper and cheaper, what is scarce, um, shifts and that scarcity actually shifts to the human element. More on that later. The second essay is called After Automation by Dan Shipper. And this one answers the obvious objection, which I'll get to in a second is his point is that AI is trained on everything that's already been done, right? Every playbook, every case study, every best practice that's been written down previously. Which makes it incredible at giving you the answer that already exists, right? But here's the catch. And his point is, so is everyone else's AI, right? Like same models, same training data, uh, same defaults. So when everybody leans on it without thinking, you get what he calls slop, right? And like everybody's ran into this. Slop isn't mistakes, slop is kind of sameness. It's the same competent generic answer showing up everywhere over and over. So you put those two together and I think, here's the punchline is a generic recommendation. The one any AI would spit out is now commodity. It's basically slop with a logo on it. And so what is scarce is the recommendation. That's right for now, let's make it personal to you for your brand in this specific moment that, uh, nobody else would have made, right? And that's where I think you start to see some generic things become more specific to who you guys are. Now here's the objection that you might be thinking, Cody, AI can write a recommendation too, right? Like a good one. So if the bar is just, you know, add a recommendation, the machine obviously clears that bar. And you're right. And I don't want to run from that because that's the actual question, if we all move from reporting what happened to recommending what to do as an agency AI can recommend, then what's actually left, right? What do you genuinely get paid for? And here's where I would say four things. Four things AI structurally cannot give you, and I'll make each one concrete. So one is framing the problem. AI is great at solving a problem. You hand it, ask it what you should do about our efficiency target, and it'll have an answer. What it can't do is decide whether efficiency is the wrong thing to be looking at this month. So it's setting the frame, deciding what the real problem even is, what's in scope, what matters right now. That's the human job. And I think the machine solves the frame. But we're the framers as an agency. So, yes, if you give it a specific thing, hey, what's wrong with my efficiency? What's wrong with my creative? It'll tell you what's wrong with your creative, but it won't tell you whether you shouldn't be looking at creative at all. Number two, AI gives you a recommendation it is not on the hook for. So ultimately, number two is about accountability. There's no name on the line. I think when push comes to shove, when a real partner tells you to put real money behind a call, they're staking their judgment and their reputation on it. I think ultimately, at the end of the day, it's very hard to keep AI accountable. People want to be able to have a human touch, to put the accountability on, whether it's themselves or someone else, whether it plays out good or bad. So ultimately, AI can advise, but it can't be held accountable to the outcome, which I think is a huge importance that is very human. At the end of the day, when you think about sports analogies, when you think about, again, the president and the cabinet, um, people get fired, there's nothing I can't fire. Claude. Yes, I can switch AI, but it's very hard to hold them accountable to the outcome that I'm looking for. Number three, conviction about your business. Again, ask AI a hard question and it hedges it, gives you the balance. View the options. You know, it depends. Hey, uh, here's what I'm thinking. The thing I described earlier. You're wanting someone to look at me and say, no, that's the wrong move. Do this. And yes, like, AI actually does that sometimes if you ask it to. Right? Like, give me the specific answer of what I should do right now. But that is the opposite of how These models behave by default. So I think real conviction really only carries weight when it's coming from a person who knows your brand has skin and your number has skin in the game has earned the sanding to say it to your face. Ultimately, I think that's what sets us apart of having conviction because you are paired with the outcome. And then number four, I think this is huge, um, and this is a subtle one. But I can retrieve patterns from public data. Right. Here's what the Internet says about beauty, customer acquisition costs. But it can't say I watch this exact play and exact framework work out for a brand like yours last month. And here's the nuance that doesn't show up in any data set, et cetera, et cetera. That's private, it's current, it's filtered through judgment. Um, and I think that's the cross client edge of an agency that gets more valuable the more generic everything else gets. So there's a way to picture all of this. Think of the work as a sandwich. The human is the bread on both ends. One person sets up the problem with real context going in and another judges whether the output is actually right coming out and turns it into a decision. The AI is kind of the, in the middle. So we're not competing with the middle. We uh, are the bread. That's not the job of AI is taking, that is the job. Now you have a person on the front end, a person on the back end. AI is kind of like helps in the middle, gets the data right. That's where agencies cannot compete in the middle of even a recommendation or even just inputting and um, collecting all the data. But it's really setting the frame and then owning the outcome on both the front and the back end. So I want to talk to you guys about how we're doing this at uh, Kinship specifically. To be clear, we are very much proponents, uh, of AI. Uh, we have a director of AI as a position at Kinship building tooling, um, building operating systems that are shipping to clients every day. And we're heavily investing in this. And so this is not abort AI or get rid of it. I hope that's been clear. But it's also recognizing the value of the human and, and knowing what AI its place is. And what I have made clear to Kinship is that the standard we're holding everyone to every single role has to move and is moving from being a, not only a reporter of information, but being a owner of the recommendation. Right. And not just a proponent of what here's the recommendation, but the framing of the recommendation. A growth strategist that walks in and kind of reports numbers is very replaceable ultimately by a model by Claude, a growth strategist who walks in with a point of view on what the number should be and a plan to get there and why this is the right thing to focus on in this particular month. And that's what we're pushing the whole org towards that ladder. And even in our creative philosophy ties in. We talk about human Forward content. And I used to think of that as partly an aesthetic choice. It's not if Emas is right. You know, he talks about the human being, the scarce thing. Human Forward is exactly where the durable value sits and that's where the strategy sits as well. So to make this useful for you wherever you're sitting, uh, two sides to this audience, agency and, and brand owner. I want you to walk away with something that you can actually do if you're a brand, hiring help. First. I would say stop buying execution, buy judgment. And here's a test you can run in the very next pitch you take. Ask them, what would you tell me not to do? I think that's a very simple question. If they can't answer that, they just want to nod and take the order. They're an order taker. So don't reward the agency that just sends you tidy reports. Reward the one that brings a point of view and is willing to own the number with you. Right. I think that's what we really value is like we integrate at the P and L level. So we're there. There is no hiding from an accountability standpoint. Treat AI Slop as the floor, not the ceiling. If the deliverable looks like what everyone else's tool would produce, I, uh, think you're going to be overpaying. And if you're an agency or an operator, I think the reporting layer is commoditized. Even the recommendation is commoditized. So you need to move your team from reporting to recommending, but also from owning the specific outcome and recommendation for that specific moment in that specific time for that brand. Again, compete on the four things framing, conviction, accountability and the pattern recognition. Use AI uh to do bigger work, not cheaper sameness. Be the bread, not the middle. Again, I would bring it all the way back. What you should value in an agency, in a hire honestly, in yourself, is strong strategic counsel and the execution to back it up. And I think that's the whole thing. The episode, the essays, all of it points at the same sentence. Because I think that's where the world is heading. The more automated everything gets, the more valuable the framer becomes. The machines are getting better and better at solving the frame, but somebody still has to set it. Somebody still has to own the call. Somebody still has to be the human a founder bets real money on. And that's not something you lose to a model over time. And I think that's the thing that gets more valuable the better the models get, actually. And that's not a threat. Um, I think that's the entire case for agencies, as long as we're pivoting. So that's the episode. If you want to talk through what that looks like for your brand links in the description, and I'll catch you on the next one.