Episode 282: Meta Ads Performance & Profitability: What's Really Happening in 2026

Speaker A: Foreign.

Speaker B: Welcome back, everybody, to the Smart Marketer Podcast. If meta ads have felt less predictable lately, you're not imagining it. In this episode, Molly Pittman and Pet Hoofin break down what they're seeing across hundreds of campaigns, why profitability has become harder to protect in 2026, and the strategies helping brands adapt to the changing advertising landscape. But enough from me, here's Molly.

Speaker A: Hello, everybody, and welcome back to the Smart Marketer Podcast. It is your host, Molly Pittman, with a very Special return guest, Mr. Pep Houfen. How are you doing, Pep?

Speaker C: I'm doing very well.

Speaker A: Thanks for hopping on the podcast. So, as most of you know, Pep is one of our business partners here at Smart Marketer. He does lots of amazing things, but his main role is running the agency, uh, which is a, uh, really tough but exciting role, I would say, of anyone in our company. Pep really has his thumb on what's working, what's not working, what is the pulse of the industry, which I know, um, you guys, and we are always looking for, right? What are other people experiencing, right? When you can, uh, relate or hear what other people are experiencing. And it can be really validating or it can be really eye opening to what's going on in your business or in your accounts. So today we are going to look at meta Advertising in 2026. This is a little bit less of what's working now, which we usually cover. Very tactical. This is more of, um, what the heck is going on. How are things looking in 2026? Um, uh, Q1 seemed to have been strong for many of you out there, and Q2 has been a big question mark. You guys know I've been doing this stuff 15 years and this is nothing new, right? We are riding this roller coaster that is direct response marketing. That is meta advertising. There are thousands, if not millions of variables that go into the success, um, or failure of a brand on these platforms. But our job in this industry is to look at what is happening across our portfolio of businesses, across all of our clients. What are we seeing and how can we give you guys that information? So, Pep, I know you've put together, uh, sort of a pulse of meta advertising so far in 2026. I'm, uh, excited to dive in and see what you found.

Speaker C: Yeah, it is super exciting because, um, the day to day, it's hard to get a grasp of actually what's going on. High level, right? Like on average in the industry because we work with so many clients, there are always brands that are scaling, there are always brands that are Going to tough spots. So it was fun to basically look at all of the brands and what are we seeing overall, uh, in the industry. And Molly, to what you said, you're right, like Q1 actually turned out to be a really good quarter. Um, if we look at our client portfolio, on average the brands were up over 10%. Right.

Speaker A: Year over year. So year over year. Okay.

Speaker C: Year over year compared to Q1, 2025. On average the clients were up in top line revenue, um, and obviously also corresponding profit compared, um, to uh, Q1, 2026. Right. So we were up, which was great for most of our clients. Now if you look at Q2, sorry, let's go back. And you can, you can.

Speaker A: No puppets. One of my favorite parts of the agency world. And you know, owning the businesses that we do, uh, I think it's really, uh, allowed us wisdom in this discipline that I definitely didn't have earlier in my career. And it's the understanding that, yes, there are similarities of what works and what doesn't and kind of what's going on in the environment. But it is so wild to, you know, open my laptop every day and see how vastly different it is for different clients. Right. It's like some clients are taking off, they're having huge success, some are really struggling. And I, um, think that younger Molly thought that everyone was kind of having the same experience and I think that's a really fun part of our job. It makes it difficult, especially for the clients that are struggling. Um, but it's just so interesting to see that isn't that surprising to you? Um, it's like the pendulum swings so far depending, uh, on the business. And there's not always a correlation between who's winning and who's losing in that particular moment. It is almost like a game sometimes.

Speaker C: Yeah, you're absolutely right. Uh, because there are always brands that are winning, right? No, probably. No matter how bad the economy is, how bad Meta is doing, there are always brands that are winning. And I think when a brand, or maybe if you're listening, you're going to a tough spot to some extent. Also confirmation bias. Right. Because you are, you're going to start looking online for signals that other brands are also struggling, for example, because Meta is underperforming. So that there's also, yeah, there's a danger to that. So there's there, there are always brands winning regardless of what, um, the online sentiment is.

Speaker A: Yeah. And when you're struggling, of course you're going to go dig for validation or other people that are having the experience. How do we get out of this? You know, sometimes when clients are struggling, they'll send, you know, Reddit threads and it's like, look, this is happening here. And I'm doing research. And all of that is. That's a superhuman thing to do. And that's really the point of this episode. So, uh, yeah, Q2, I got to speak at Nick Shackelford's event in April in Austin, and I asked who has been struggling with Meta M the past month or two, and it was wild to see. This is a room of some of the best direct response marketers in the world. And most people are like, ah, uh, what is happening? What is this black box? So, yeah, what are we seeing this quarter?

Speaker C: Yeah, exactly. Ah, I think that's very fair. And what was interesting to read, actually, was that. So North Beam published, uh, basically a brief report, and they compared conversion rates and cost per click to last year or basically the last 12 months. And they reported that right now, cost per click and conversion rates are at historical lows. Like they are the lowest they have ever been over the last 12 months. So, um, I actually wrote the exact numbers down. So conversion rate went from an average 1.4% in January 2025 to.7. So it halved Right. Across all of the brands that North Beam tracks.

Speaker A: And that's not surprising. You know, when we do quick diagnostics on accounts, you know, I'll go in from a strategic level. This isn't working. What is the variable that is underperforming the most the last few months? It's. It's always the page, it's always the conversion rate.

Speaker C: Yeah, for sure. Um, but the cost per click as well. Right. Like, the cost per click went from around $2.70 in January 2025 to $1.33 around now. Right. So, like May 2026. So the thing is, those are averages, right? Because if your conversion rate drops with half, but your cost per click also drops in half, you could then basically your cost per acquisition or your roas could be the same. But obviously that's not how it works.

Speaker B: Right.

Speaker C: It's not for every brand. It's halved. And therefore the RO obviously not, uh, is the same. It doesn't work like that. Um, so I think that was a very insightful report because northbeam, it's not like one person on Reddit, for example, this is really a really good source of information across many brands. So I think it's definitely a confirmation that specifically Q2 was hard. And a lot of brands are struggling, um, right now. And one of the things that we've seen, Molly, in a few of our client accounts actually is that Meta has been for some reason pushing quite a lot of traffic towards the audience network. Right. And the audience network, it's basically not the advertising that you're seeing in the feed or in your stories. Right. It's really completely different placement. And if you see a lot of traffic go there, your cost per click might be really low. Um, but it's generally, it's generally junk traffic. And that is something that we have met us like we have actively seen it do in multiple client accounts. Um, and that, that can absolutely be a factor in, uh, declining conversion rates.

Speaker A: Yeah. It's interesting. I know one of our biggest accounts in the last few weeks, we were really struggling. We identified that placement as part of the issue, shut it off. And it seemed to lift performance a bit. Other than that, you know, this is really fascinating to see. Uh, let's leave CPC out of it. I think that's just part of the economics of Meta is a whole. And how they are adjusting to make sure people keep spending. Not that we can't come back to it, but the conversion rate part is really interesting to me. Not in the last 15 years of my career have I actually seen that. Like, that is a dramatic. That's half. For those of us that are bad at math. That is half. There is really no account that we run that is not seeing this, which is very interesting. Some sort of drop in conversion rate other than audience network. What do you think this is? I have my own hypothesis. Again, I'm sure it's thousands of things, but where does your amazing media buyer brain go with this?

Speaker C: It's a really good question to think about what the true answer is. The true answer is from a conversion rate. I don't really know.

Speaker A: Yeah. And that's valid.

Speaker C: Yeah. Because you could make an argument about the economy. You could make an argument that there have been a lot of Meta outages starting in March for us as well, which is generally annoying. So maybe something like through the algorithm off, you could think about geopolitics that creates uncertainty when it comes to consumer spending. It's really hard to, to definitively say this is the one thing. And the easiest thing to say is probably a combination of all of it. And that's also probably most like closest to the truth.

Speaker A: Absolutely, I agree. I also, you know, something that we know that we've been talking a lot about, you know, Andromeda, whatever you want to call the new era of meta ads that we've really seen the last year, um, which is still constantly changing every day. Part of this is more trust in the algorithm, or whatever you want to call it. All right? Meta is so smart from their internal algorithm. They have so much context on every single user now. I think I've had Facebook for 20 years now, so think about the amount of data points they have on me in 20 years. And it's not just what I do on their platforms. Almost every website has the Facebook pixel, the meta pixel, right? This is an insane amount of data, right, which is beneficial. But we almost went from like the old school way of doing things as an industry, not just us at Smart Marketer, to the new way of doing things with meta ads. Consolidation trust. What? Um, you know, that meta is smart enough to know what they're doing and you know, we found and we talked about on this podcast that still to this day, it's really half and a half for us. Right? The old way still works in a lot of accounts. Having more control, having more ad sets, using more ABO versus the new way, CBO consolidation. Let meta figure it out. Um, and I think that there is a middle ground there that is getting skipped over in a lot of scenarios. So, not that the new way is bad, right? I would probably say a hybrid way, if you had to pick the best way right now in May of 2026 is probably the best, but so many people are leaning into this. Oh, I just need one or two campaigns. And yes, that works for many accounts. And that's an easy, beautiful way to do media buying. I wish it was always that way, but I'm not quite sure meta is quite there where that is 100% true all the time. And I believe that that's affecting conversion rate too. From the standpoint of, yes, audience network is a placement, um, but just the quality of traffic as a whole, right. That we are receiving to our pa. I don't think it's quite what it was pre, um, Andromeda, especially with everyone using more of this consolidated approach. So even if you go into our accounts that are using more of the new way because it works, those accounts have the worst conversion rate, right? It's like, okay, yes, the costs are down, but the conversion rate is so much worse than it was with the old way. Again, neither is right or wrong. It's just really interesting to look at this and I think that has so much to do with it because in this new way, really, as media buyers, all we have control of is the Creative, the copy and the offer page. And I think because of that, Meta is leaning so hard on indexing our pages and trying to figure out what the hell to do with our offers, who to show it to, within what context, you know. All right, Pep is on the subway from 5 to 5:30pm every day, so we're going to show him a longer page versus a shorter page. I think this system is so complex, which is beneficial, and in a year I think will be fricking amazing. It will be super power, uh, beyond what we ever could have expected. But I feel like right now we are just in this, this middle ground and I think we're seeing that. And then you layer on the economy and people just have less disposable income and all of the macro things going on in the world. Um, I feel like all of that is coming together to, uh, really cause this current environment.

Speaker C: Yeah, I agree. And I think you're really right when you say we're in a transition point. And I think a lot has to do. Yes, it has to do with the consolidated approach versus more manual approach, let's say, or more control. But if you think about it, Meta is taking so much steps that are like, even deeper than that, right? Yes, it's that. But also if you look at the creative level, for example, like you said, you have control over your creative. Well, yeah, that is true to some extent. Because if you let Meta, uh, do whatever they want to do with their AI, it will even completely change your creative. Right. If you now go in and you upload an image or you upload a video, what AI ads it generates with that, it can, it can actually either change your product completely, some actually are, are fairly good. But there are so much more that Meta is doing besides than just the recommendation or the consolidation. They are adding all other creatives automatically. Like if you create now an ad just for one single product, they will automatically add a bunch of other creatives even for different products. So you have to actively opt out of that. Right. So there are so many more things that Meta is bringing or another big thing, obviously that's changing in this ecosystem right now is that Meta is not only looking at the first purchase, but they have been really starting to actively look what is the lifetime value actually of the buyers that you buy. Right.

Speaker A: If you now the ability to optimize for that, like, lose my mind.

Speaker C: Yeah, yeah.

Speaker A: That is a gift from the marketing gods.

Speaker C: It's incredible. It is incredible. But like, Molly, like, even if we would have a higher cpa, but Meta knows that, uh, that buyer will actually drive a higher lifetime value, but it might hurt our profitability on the front end and it might generate reports that we just have seen. Is that, uh, not actively actually a good thing for us long term?

Speaker A: Like it might. Yeah. And I think, you know, it's direct response marketers, we're so used to looking at the conversion rate. Right. And these secondary metrics which matter, they will always matter. But with meta system now, they're looking so high level. Right. And we kind of have to zoom out too. I also think AI is playing a part here. I don't think this will always be the case, but you know how much I love landing pages and offers. And um, you know, the last year I've seen some of the worst pages I've ever seen in my life.

Speaker B: Right.

Speaker A: Because people are like, oh, I can build a page with AI. Ah, that is true. It doesn't mean it's good. It doesn't mean that you actually know what you're doing. So I think we also have that factor here of like, uh, as my dad would say, it's an issue, uh, between the hands and the keyboard. It's actually nothing to do with meta, where our behavior has changed as advertisers and a lot of people are putting out AI slop and their pages are. And I think that is really factoring in. And again, that, uh, won't always be the case as these tools become more sophisticated as we continue to develop agents that do CRO for us. I'm so hopeful about that. But I think also just in the AI realm, we're in this transition period where people are like, oh, I can build a page with AI. And it's like, that doesn't mean that it's good.

Speaker C: Definitely.

Speaker A: So. And there's such a higher volume of landing pages too than you saw when we had to build everything manually. So definitely something to take into account here when we're looking at Q2. Pep, how are things looking year over year in aggregate with the same analysis that you did Q1 over, uh, 26 and 25.

Speaker C: Yeah. So I have the data as well. Right. Because, um, top line revenue is down in Q2 now with about 10%. Right. And we haven't finished Q2, Q2 yet. So we're basically flat for the year right now if you, if you sum Q1 and Q2 up together.

Speaker A: And Pep, uh, I think that's the first time in my career really since we've started looking at aggregate metrics like this that you see even like A quarter really be down from the year before. Right. Like, the business is smaller, essentially, it's doing less revenue than the year before. Now, it doesn't mean that profitability has also taken, uh, that, that same course, but it's really interesting to see, like, that's, uh, not what we usually see year over year. Usually traffic gets more expensive. Usually businesses grow at about 10 to 20% and life moves on. So this is a big shift. And guys, this is not like meta advertising doesn't work anymore. I don't think that will ever be the case. Right. This is just us acknowledging, hey, stuff is changing. And, um, you know, you might not be alone in your, in your experience.

Speaker C: No, exactly. And that's the hard thing, right, because a lot of brands came in Q1 and they were like, yeah, we're beating last year. Year were really outpacing last year. And then Q2 took a very significant dip because if you go from plus 10% to minus 10%, that's a 20% swing. Right. And that obviously, like, that doesn't feel good because as humans, we want to progress. We want to beat last year basically every year. Um, now that's. For now, that's just not the case, unfortunately.

Speaker A: Yeah. How is profitability looking?

Speaker C: Um, yeah, obviously that depends on, um, that depends a bit, obviously, client by client. But what we're seeing that profitability is also taking a little hit because we're down 10% in terms of revenue, but we're down 5% in terms of revenue. Sorry. In terms of ad spend. Right. So we're basically spending a bit more to generate still that revenue. Because if ad spend would have dropped as well with 10%, assuming that the other factors are the same, then you could make an argument. Well, the profitability percentage is similar. Um, but that doesn't seem to be the case because ad spend only dropped with 5%.

Speaker A: Yeah, that's fascinating. You know, we're at the end of May right now as we are recording this in 2026. So we have one more month left of this quarter. Then we go into my favorite part of the year, Q3, Q4, things start to heat up again. It'll be really interesting pep to see what happens. You know, this has been a, uh, very different year than we've ever seen. What do you think we'll see in Q3 and Q4? I know it's impossible to predict, but what does your gut say?

Speaker C: Yeah, I think there's a good probability that will actually still do really well in Q3 and Q4. Uh, Meta's performance can really come with ups and downs and obviously there is no other way that they are feeling this internally as well. Obviously, Meta is a gigantic business with a tremendous amount of revenue, but like, they obviously monitor what is happening. Um, so I'm sure that they are actively working on this. Um, though you're obviously never able to speak to someone, so we don't really know. Um, but I do think that Q3 and Q4 will be pretty good.

Speaker A: Yeah, it's interesting. I think they just laid off what, 20% of their work, uh, which I think would have happened either way with this, this AI age. Um, but what we do know is that Meta wants to make money and to make money, advertisers have to spend money and we spend money when we're getting the results that we want. Um, so there's no world that we live in that they don't care about this or that they aren't looking at it in the back end. Um, but I don't think it's something, you know, a few people have told me, oh, the algorithm shifted in March, like something really big changed. I don't necessarily believe that that's the case. Again, I think this is a mix of, uh, many variables coming together that's creating the current environment that we're in. Um, and I think when you're in an environment like this, you can do one of two things. You can say, oh, this isn't working, I'm going to be frustrated, I'm going to have a negative mindset about it. Or you can step back and say first off, how amazing that we live in the Internet age, that we can literally start and run a business with a few clicks of button, right? That we get to live the lives that we do. And business is about riding that roller coaster, whether it's emotionally, whether it's top line revenue, whether it's profit, whether it's the up and down of your team size or Meta ads or performance. I think this is so important to talk about Pep, because when I look at our clients, um, that are growing right now even right, right in this moment, I was thinking about that this morning. Every single one of them has a very forward thinking, positive mindset. It sounds very simple, but there are a few people I won't name by name that I'm sure are swirling around your head right now. And they're not complaining. They're not like, oh, uh, why isn't this working? Of course they're questioning it. Uh, but they're like, hey, what do we do? Moving forward. I know this is part of riding the wave. Um, and they are the ones that are actually seeing a little bit of growth even with top line revenue, even in this really hard climate. So what do you see there with mindset? Because I think that is so important, whether it's the media buyer, whether it's the creative strategist, whether it's the owner of the business or someone internal that we're working with. It's like, uh, everyone's collective mindset really plays a part in what happens in these accounts too. And that's super fun to see because I think when you have a positive mindset, you're more likely to, to try to work out the problem, you can more quickly work it out versus going to that dark place that kind of shuts you down. Um, and yeah, it's just cool to see how that works across the board.

Speaker C: Yeah, for sure. And I think there are still brands that we are, ah, working right now that are winning and are doing really well. And I think some of the things that they do very well is that they just, just they work with the cards that they're dealt with. Right. So platform instability, up and down, that's just something that they cannot really control. So I think a few things that I think that they do really well, they work very actively with us or an internal person to protect profitability so that they can sleep at night. Right? Yeah.

Speaker A: They're okay to spend a little less and have higher profitability for this, um, season.

Speaker C: Exactly. Because they don't have the ego that they're like, I need to beat last year top line number, even if that hurts my profitability. No, like, profitability will actually allow you to sleep well at night. So that's one.

Speaker B: Right.

Speaker C: And I think second, like a lot of the brands that we work with, the founder and the CEO, um, that person is very often very passionate about the products. Right. And the problems that they're trying to solve. So I think the brands that are winning, they are very actively thinking about what new products can I launch. Uh, because at the end of the day, you can outperform anyone else if you have the best product in the world that solves the biggest problems and it will generate the biggest transformation. Right?

Speaker A: Yes. And, and also pep, just to add on to that, it is really interesting to see the founders that stay in their lane in that way. They're like, cool, I'm going to go focus over here on staying in touch with my market and what they want. Right. That's something we can never really Measure. But that's the name of the game here, right? Am I actually selling something people want? Adding new products so that lifetime value is higher, so that we can pay more to acquire a customer. Um, and they're not trying to control the marketing process as much. Right. They're not as, uh, like one thing that pops up in my mind, you know, we have some clients that are very controlling over like the creative process. Right. Which I understand that you want it to be on brand. You want everything that comes out to be the proper representation of your company. I get that. I feel that way. Um, but there are some leaders that try to control that so much that there's never really forward motion there. Right. It's like nothing is good enough. Or it makes something like the creative process really stagnant. Then we don't have the volume or the diversification that we need because that person isn't really staying in their lane. They're kind of coming over here to this lane and trying to control that process. That is really interesting to look at. And the founders that stay very high level, that stay thinking about the company as a whole, the products as a whole, the future, where is this going? And sure, they might approve creative, they're still watching what's going on, but they aren't holding it so tight and controlling it so much that, you know, it makes it hard for us to do our job. That seems to be a huge correlation of who is winning and who's struggling right now too. And that all goes back to mindset, because when things aren't going to expectation. Right. Whether you put ego aside or not, a lot of people's first instinct is to try to control the situation, which I totally understand. And you should in some way monitor and be involved in what's going on. But there is, uh, also a pendulum there where there is so much control that it just creates a stagnant environment in your whole marketing ecosystem. And I think that is a really bad place to be. Um, and just something for everybody out there to think of. Like, am I doing that right? We all do it to some extent, but am I doing that right? Am I actually part of the problem? Uh, I think that's really important for, for everyone to reflect on, especially if you're, you're the leader of a company.

Speaker C: Yeah, 100% agree. Because you're cutting the oxygen to some extent. Right. And it's also like, where does your time have most impact and ROI on the business that is probably thinking about product expansion and potentially like channel diversification, protecting Profitability, you know, working with suppliers. Right. That's generally, you know, what is the highest roi, what I, what I think, um, for people in, in that specific role. Right. Thinking about, you know, like, you could also say that like, like channel diversification right now when Meta, you know, gets hit in Q2 is probably something that we all should have done in 2025 or Q1, 2026, because it would be easier to manage the. The volatility that Meta brings.

Speaker A: Absolutely, yeah. And just being open to channel diversification into trying something, um, and maybe it won't work, or maybe it will. Uh, very, very interesting. So what do you think? Q3 and Q4, like, hopefully meta is getting its ducks in a row, uh, here during the summertime, which is usually more of a lull period, of course, unless you sell something seasonal. Um, but for most businesses, the summertime is softer. Um, and this could be a good time to sort of rein things back for a minute to look big picture in your business. Right. What new stuff are you bringing to the table? Are you just trying to do the same thing you have always done? Uh, this is a great time to reorganize, um, and accept. What if Meta is never as powerful as it was before? I don't think that's the case. But what. Okay, maybe there is a world where we never go back to what it was last year. That's okay, too. This is still an amazing channel. Right. This is still something that most businesses should be using. And what does that look like for you? Right. I think that's a really important exercise to do and take this summertime so that we are ready when things heat back up from a consumer standpoint, usually around September, and then really going through Q4 and then Q1 of 2027 with some momentum that's brought from somewhere else. That's not just an ad channel. Right. That's brought from new products, that's brought from new channels, that's brought from a whole new outlook on, um, what you're doing than what you've had before.

Speaker C: Yeah, I totally agree, and I think it's an excellent time right now to actively think about that. And I truly believe that focusing on the product is probably the most important thing because that, again, like I said earlier, an amazing product positioned well will beat any platform, um, volatility. And in addition to that, what are other platforms and what can I do from a branding perspective as well? Because, Molly, what we see as well, like, we have clients that are crushing it, and a common denominator is that they Are very actively with organic as well. They do podcasts, they create a bunch of organic content and that will just massively help with ads as well. Your roas will be higher when you have a brand, right? When you run ads from your page or Ezra's page, it does better.

Speaker A: Yes, well, and it's not just an organic thing. It's back to understanding the audience, right? They're an audience of people that I understand. I know what they care about, right. I know what they respond to. So even when I put something out organically that's not paid, I receive data, right? I receive engagement here. So it's really back to the fundamentals that have mattered for hundreds of years. And I think when we get into drier periods like this, going back to the basics, there's nothing more important. I was having a conversation last week with a nine figure brand owner that's in our masterminds. He's like, molly, all I have ever done is focus on the fundamentals, right? I don't get caught up in anything fancy. I try not to stress when platforms have roller coaster moments and I really stay in the fundamentals of who am I serving and what do they care about and what am I selling them. So uh, that should be a, uh, for anyone listening that's feeling stressed, that should relieve you, right? It doesn't have to be as complicated, uh, as you think. Pep, what are you seeing too on the AI side of things? Whether it's from uh, the standpoint of how people are using AI to build assets or how that's changing things like the way that meta functions or even how we interpret data, like how do you think that whole topic, this whole uh, evolution of AI, how do you think that's affecting what we're currently seeing?

Speaker C: Yeah, a few thoughts. I think the first thing I think that you said earlier is that we are basically in a transition period right now because most people have used AI as basically a tool in their tool stack to basically increase their productivity, right? So to generate more, to generate more assets, more copy more pages and so on. So to some extent we really have become AI enabled. And something that I've heard from a lot of people, it's just like, what am I doing wrong? Because it's not saving me time, it's actually costing me more time because I still have to go and edit, I still have to go and check. And I think we are in a transition period where we are now going from an AI enabled place to or AI enabled businesses to becoming AI native businesses where AI is actually starting to do a lot of the work. Uh, right. Like a few months ago, OpenClock came basically out of nowhere, which was the first period that the industry was really shocked. That was like, wow, actually like, wait, this allows AI agents to actually start and go do work versus it being a step in my workflow. And I think for 2026, 2027, I think that's the biggest topic in AI is like, how do we become AI native businesses versus an AI enabled business? Right. What are the AI workflows versus what are the human workflows where we use AI as a step in the process?

Speaker A: Yeah, absolutely. And we have lots, uh, of exciting things coming on that front too, through a partnership that's going to enable all of you guys to really go deeper into having an uh, AI native first business versus just using it as a tool and really using it in a way where you're looking at the entire business through this lens. Not just here's a tool that makes creative using AI or here's a tool that writes copy like an actual underlying operating system of agents that are working together as a team. And also allowing you to see big picture what's going on in your business, not just saving time or not just allowing you to operate a little leaner because you need less team members. So I think we're going through the biggest transition that I've ever seen in my career and I'm really, really excited about it. And I think if you take nothing else away from this conversation, guys, it is your mindset that is going to dictate your success. And I know that sounds woo woo, but it is so true. If you get really down about this or you get into a negative place about meta or about the future of this, it's going to be really hard for you to participate. So that's, I think how you handle the downtime says so much more about you and where you and your business are going to go than how you handle things when you are on top of the mountain. So I would say there are more folks in the valley right now, uh, than usual. And that's okay. If you're there, you're not alone. And if you're winning, amazing. If you're winning during hard times, imagine what it's going to be like when things catch up and normalize. Um, so I'm excited about it. I also think pep, even though AI makes things faster and more obtainable, I do think this stuff is harder and more complex than it's ever been actually for many reasons. And I think the barrier to entry feels easy because it's like, okay, we have all these tools, you can kind of have a business in a box, but then you have just the saturation and the complexity and like how advanced everyone who has been in the game for a while now is, right. To sort of catch up to. And so that's another pendulum we have to look at. Right. It's like, wow, okay, there is momentum here.

Speaker B: Right.

Speaker A: Even if it doesn't feel like this in Q2, there is momentum. Ah. And there are people that have been in this game for a long time. Um, and it's going to be really interesting to see how the businesses who are entering the market now how that ends up, uh, shaking out with the businesses that have been in the game that have rode these waves for a while. And what that means moving forward.

Speaker C: Yeah, absolutely. And what you said is 100% correct, right? Like, AI is not only the biggest thing that has happened in our career, it's probably the biggest thing that has ever happened to human history to some extent. Like human technology is search, it's bigger than the Internet. Right. This probably has as big as an impact, um, on society as for example, electricity had. Um, so, um, this is how society is going to move forward. And back to what you said about mindset. Like, having the right mindset about this is absolutely crucial. And there are a lot of studies right now where AI actually is seen very negatively, very negatively in society. It's a major issue right now in society about the perception of AI. Um, so I totally agree with you that mindset here is everything and the willingness to adopt it and to see that it actually is a massive enabler versus a net negative, I think is, um, is only becoming more important.

Speaker A: Yeah. And I just want to add, you do not have to be the biggest proponent of AI or think that it's the greatest thing that's happened in human history to have a positive mindset about where you are going with your business. Right. I'm still very much in the middle. I think it is so amazing, so cool. I'm very excited. And I love humans. I love old school slow way of living out on my farm. I have lots of questions and concerns about what AI will mean for humanity if you don't. I, uh, don't know. You should. Again, there is a pendulum here and the truth probably lies somewhere in the middle. So we are not saying that you have to 100% think that this is the best thing that's ever happened. And it's more of the Acceptance of change, which is really hard, especially if you've been in this game for a while. It's like, wow, things are changing at a quicker rate than they ever have been. And am I open to that? And this is something I've really had to work with myself on, uh, because I don't have another option. And also, am I resisting the change or am I riding the wave? Wow. I can still at the same time have concerns or, you know, wonder what this is going to mean for humanity. So I know a lot of you out there are, you know, very anti. Like, we have a client that was like, molly, I don't want AI to touch my business. And I'm like, okay, well, that's pretty much impossible. But I feel you. I understand that. I see where you are. I feel that that is a camp you can be in. We have clients that are fully AI, right? Like, their entire business is even now in 2026, fully running on AI. Essentially, we have the people in the middle where I think I live. Um, and all of that is okay too. Right. But wherever you stand, I just want you to sit and think, am I accepting that this change is happening or do I have some sort of internal pushback to this? Because wherever you sit, this is gonna happen right there. There is no way. This is not going to happen. And someone in your market is going to move forward and accept this change. Um, so it's really something we, we have to sit with as business, uh, owners and as people. And sometimes it's okay to separate those things too. Right. Like, I see it as the biggest opportunity we've ever had in business. And then Molly is a person living in small town Kentucky is like, uh, I would rather that not infiltrate my whole life.

Speaker C: Right?

Speaker A: Like, I'm happy that I live in a place where there probably aren't going to be robots roaming down the street delivering food for a while. Uh, and that's okay, too. So, yeah, Pep, this has been a really fun conversation. And again, just going back to transitions. We are in a transition, uh, and it's going to be really fun to see not only what happens the rest of the year, but, goodness, where are we in five years? Where are we in 10 years? It's impossible to imagine. I don't think anyone can truly predict or imagine, but the things that we can control are ourselves, our businesses, and the way that we think about, uh, what's going on in 2026.

Speaker C: Exactly. And, um, that's also something that Ezra always says, right? You can't control what happens Outside, you can only control how you show up every single day in your life and to the business.

Speaker A: So, yeah, that's what we try to do, baby. All right, dear, anything else you want to add? Pep, do we have any room for clients for people that are struggling with meta or scaling, uh, and looking for more assistance? There. Are the books full? How are we looking right now?

Speaker C: Yeah, no, we have quite a lot of, um, services right now, which is very exciting. So we have always some spots somewhere, right? Because we have meta for sure. We have a few spots there. We do Excel now, App Love and ads as a service. We have answer engine optimization, we have email. So, um, yeah, if you are interested in working with us, you can always head over to smartmarketeragency.com or just email me pepsmartmarketer.com and then, uh, yeah, we can always chat.

Speaker A: Yeah, and if we can't service you, we will point you in the right direction. Also, be on the lookout for this agentic system. We're finding the right name for this thing. I'm calling it Smart Marketer OS right now. Uh, be on the look in the next month or two. This is something that we're not only using internally, but we will be launching to the general public and something that all of you guys can install in your business. So thank you guys, as always, for listening to the Smart Marketer podcast. If you enjoyed this episode, please subscribe. Please leave us a review. I don't have to tell you why that matters. As marketers, you know that that helps us in the podcast algorithms, uh, to the fullest extent. So please show your appreciation by subscribing, reviewing, sharing with a friend. Thank you as always for listening. Uh, thank you for spending your time with us and we'll see you in the next episode. Bye all. Cool. That was really good.

Speaker C: Awesome. That was.