Pat Murphy:
Hi and welcome to the MCA Prodcast, your fix for everything innovative in advertising production. I’m Pat Murphy and to mark the end of a really successful season 2, on this episode I’m bringing you some of my favourite bits from the conversations from the past few months.

I’ve been lucky enough to sit down with some of the real shining lights in our industry and we’ve talked about so many different topics; from diversity and inclusion, to AI and virtual production, and the seismic shifts that have happened in advertising production in recent years.

First up, is Rishad Tobaccowala, my favourite futurist. With over 40 years’ worth of experience, he was named by Time Magazine as one of five marketing innovators and called Advertising Legend by the Advertising Club of New York. He shared so many brilliant insights into our industry, and started with his definition of excellence.

Rishad Tobaccowala
Excellence, I basically believe, is a threefold thing. You need excellent clients, otherwise you can’t do things. You need excellent people, and when you have excellent clients and excellent people, you get excellent financial results and, primarily because of those two, you get excellent advertising, which then gives you excellent financial results.

So that clearly weakened a lot, probably between 2000 and 2015, 2017. What has changed a little bit is both inside the industry and outside the industry.

Outside the industry, especially in the last two or three years, the large competitors that are not necessarily the advertising business, but companies like Google, Meta, etc. Have become less attractive. A year ago, they did significant layoffs between 15 to 20%. They become less attractive because, in many ways, they become 150, 200,000 person companies that actually are run to avoid risk because of potential litigation and monopoly and other kinds of stuff and, as a result, it’s a little bit less fun. If that makes sense, and at the very same stage, what people are also beginning to realise is marketing has always been about this unique combination of math and magic, or what I call story and spreadsheet, and part of what happened is our business tilted too much towards the spreadsheet versus the story, and my concern was, if you’re going to make a business that is technology and quantitative oriented, you are going to drive the best people to where they’re comfortable with that, which is in the world of finance and technology.

So you need actually to have this fusion again, and I think we’re getting back to this fusion, in part because of AI, in part because of a lot of other things, and our business, which is actually a combination of plumbing and poetry, became too plumbing driven. It wasn’t a fun business that much anymore. Right, and obviously business should have some fun. I’m not saying business is fun, but business is no fun. That in effect. You can might as well go and work for where you maximize your revenue or maximize your income.

Pat Murphy
Exactly.

Rishad Tobaccowala
And that has started to change because the poetry is coming back into our business. It is becoming plumbing and poetry. The challenges are becoming bigger and, to a great extent, it’s starting to happen and, more importantly, the business has become far more… It looks like it’s consolidating, but, yes, the big guys get bigger or the big gals get bigger, but there’s much more fragmentation. You can have many more choices of where you can work and how you can work. But I think the single biggest thing comes back to talent. I truly believe and this is what most board of directors don’t understand is power has moved to talent, away from management, and it has only just begun. It has only just begun and part of what people are struggling with is they don’t know how to manage. They know how to boss and, as you know, I’ve written about the age of de-bossification, and so the bosses are in panic and usually when there’s this eclectic, crazy bohemian time, it’s a great time for advertising and marketing.

Pat Murphy
You mentioned telling stories. I’m a great believer in telling stories in every situation if I possibly can. I find that we are in the business of communication and many people are actually truly terrible at telling stories. What can people do to be better at telling stories to inspire or influence or change minds? What can they be doing to make themselves better?

Rishad Tobaccowala
I would say that there are four things that people should do. First of all is they should understand they themselves are moved by stories rather than by facts and data, so the senior most people sometimes I have to go into like very senior groups of people when I start this way, I basically say ‘hey, look, number one, how many of you all in this room are wearing a watch’? So almost everyone, puts their hand up, even if it’s an Apple watch? Second is, how many of you all drive an automobile that is more expensive than the equivalent of, let’s say, a Toyota Camry would be in your country, and a lot of people put their hands up because these are senior people.

And then I basically say okay, you’ve just proved to me that you only made two decisions that make no sense. Your phone has a better watch than the watch you currently wear, and once you start going beyond the quality of a Toyota Camry for every dollar you spend in a car, you’re not spending it for utility, you’re spending it for telling a story, identity, showing off design, comfort, and that’s because people choose with their hearts and may use numbers to justify what we just did. So you all have just proved to me that you’re not driven by that, so don’t talk to me about all your data driven stuff. But, more important, if this is all about data driven stuff and, as you probably know, I have an advanced degree in mathematics right and an MBA in finance. I said why is it that, while I appreciate data, I actually run away from any job that is very data driven? It’s because the machine will take away your job.

Pat Murphy
Quick question on that then – do you think that more clients, more marketers should take decisions based on gut instinct instead of the data that they’ve been given?

Rishad Tobaccowala
I believe that what tends to basically happen is data is like electricity you should not make decisions without it, because it illuminates the way and otherwise you are in the dark. But tell me a company that differentiates on how it uses electricity. So it’s an ingredient, but eventually what matters is judgment. It may not be gut judgment, experience, risk-staking, and if you can’t do that, and as anybody, you basically say this is what the spreadsheet or the math told me to do, you are out of a jobs soon. The machine will be able to do it much better, right?

So, in effect, I come back to the idea of stories by very simply saying A you are driven by stories. B the world’s greatest brands whether it’s Apple or Louis Vuitton or anything else, the most valuable companies, right, are about design, storytelling, provenance. They have data, they have utility, but that’s not where the differentiation happens. So if you’re in the marketing business and you aren’t in the storytelling business, and you’re in the wrong business.  In fact, I believe, and I’ve always basically believed, every single person is a salesperson and a storyteller, because without that, we would not have found the partners we have. We had to tell them a story.

Pat Murphy
Thanks so much to Rishad.

Another conversation I really enjoyed this season was with Efrain Ayala, Global Creativity and D&I Director at Reckitt. He has more than 15 years of experience with strategic, creative and digital transformation and is well known for his approach to DE&I,  being named in 2023 as a WFA Global D&I Ambassador

We talked about the challenges many individuals face when it comes to approaching diversity and inclusion in a meaningful way.

Efrain Ayala
The first piece of advice I always give every marketer is like don’t be paralyzed by fear. If you are so concerned about getting it wrong that it prevents you from doing anything, you’ve let the fear win. Think about those incremental steps forward that you can take, right? We’re on a long journey here. Social inequities have been baked into society for centuries and we’re not going to be fixing things overnight. And while consumers are turning to brands to do more to create positive change, in some instances they expect brands to create more positive change than even governments. It’s about what are those incremental things that we can do?

For example, a large portion of the Reckitt portfolio of brands sits within the hygiene and home cleaning category, and I think if your listeners were to close their eyes and think of an ad that covers a home cleaning product, you probably imagine a woman being featured doing all of the cleaning, and oftentimes that woman is in khakis, a nice cardigan, and that’s not the reality of how women are doing the home cleaning. But also, women and girls do three times more unpaid domestic labour, preventing them from social mobility. So what is our responsibility with such a large home cleaning portfolio that reaches millions and hundreds of millions of people a year worldwide with our ads. We need to take a choice on – there needs to be more representation of men and even the children taking some ownership of those household duties, because it isn’t one individual’s responsibility just simply based on their gender expression.

And it’s those small steps that can be taken. And when we took those small steps where we show the dad doing the laundry versus the mum in this instance, while that might feel like a small incremental change, it actually drove such a stronger response from consumers with that ad because it starts to feel much more authentic and it feels much more relatable to their lived experiences. And so I tell marketers don’t be paralyzed by fear And if you are nervous, think about those small incremental changes you can make now and then build on them year over year. And through that journey will come to a much more progressive place. And if you’ve seen any of the Kanter white papers that they’ve been producing over the last several years, progressive ads always outperform ads that are laden with stereotypes.

Pat Murphy
Is there some advice you can give agencies, production houses to get this right? When is the right time to discuss this in the process?

Efrain Ayala
As early as possible and think about when you want to start talking about D&I within the work and then do it earlier. For us at Reckitt, it’s about ensuring that our brands can take meaningful and measurable action to benefit society and the planet. So it starts with our brand strategy. Each one of the Reckitt brands aligns to one of the United Nations Sustainable Development Goals where they can make a tangible difference and contribution to those goals. Within that, that’s where our purpose sits right. Why do we exist? But uniquely at Reckitt, we also pick a fight, and a fight means we take action and that there’s an enemy and there’s a beneficiary, and it’s within understanding who will benefit most from those brand actions. We determine who the brand can claim as a D&I commitment or the community that it can benefit the most. So that sits within our brand strategy. And the fact that it sits there ensures that when we do insights and consumer research, we already have a lens to the communities we want to be bringing along in this journey, whether it be water-scarce communities with the finished work we do to skip the rinse, or whether it be women who suffer disproportionately from pain because there’s a gender pain gap that’s been created through biases.

So we know this going in. So then it guides our insights and research. It, of course, goes into our brief. Then we do it through the creative development process. So by the time we get to casting and working with production partners, we have a very clear vision as to who we want to benefit and how we can portray those people to make sure that that benefit lands within the work. So for us it’s about all the way upstream but also keeping a red thread through the entire comms media value chain.

Pat Murphy
Such great insight from Efrain, do check out our full conversation.
Next, you’ll hear from Andrew Robertson, President and CEO of BBDO since 2004. He’s worked with major clients including Meta, AT&T, FedEx, GE, Mars and many more and was inducted into the American Advertising Federation Hall of Fame in April 2022.

Andrew and I discussed some of the really big changes that we’ve seen in advertising production in recent years.

Andrew Robertson
The seismic shifts that have taken place in this business as opposed to the continuous evolution and development of this business have really been twofold so far. The first was the invention of the internet, which was obviously a turning point, and the second was the introduction of smartphones. Those are the two big, big moments over the last 30 years that had profound, profound impact on what we do and how we do it, but they really were primarily about how we reach people and how they interact with our work, rather than how we create. They affected what we create, but not how we create.

The third seismic shift that I see in our business is the one we’re in at the moment, which is that of generative AI, which I think, for me, is going to be the third profound shift and the first, which is really focused on how we make things, how we create things. The others, as I said, were more about how we distribute and what we have to make. I also think an area that is going to have its impact much faster than the other two.

I think it took like 10 years for the internet to become a real advertising medium, and it took five for smartphones to be, as this is something I see happening in two or three, and I’m really very excited about what it could mean because I think, if everybody just sees it as an efficiency play which allows everybody to get everything at average for nothing, we’re really, as an industry, agencies clients we’re going to have missed a big trick, because to me, this is a massive effectiveness opportunity and primarily because it enables us to close the most important gap for creative people, which is the gap between having an idea and bringing it to life, and that gap can be big because of time, it can be big because of money and it can be big because it’s something just isn’t possible.

You know – I’ve got a brilliant idea but it’s not possible. Then it’s just an idea, it doesn’t become work until you’ve made it. I’m really, really excited by the potential to close all three of those gaps – that gap between having an idea and bringing it to life that generative AI is offering, not so much, I have to say, from the perspective of the written word I think that’s good for summarising reports and stuff like that but for creating visual images and video and improving those images and video at a speed, at a cost and, in some cases, making something that wasn’t possible, possible like we’ve never dreamt of before.

Pat Murphy
And one of the other things you said in that presentation that I saw you do recently in Nashville, was you said that we’re all gonna have to be absolutely brilliant, prompt engineers in the years to come, a bit, like you know, Microsoft365, as you said. Do you still subscribe to that?

Andrew Robertson
Yeah, because I think when it comes to using these technologies, that’s where the craft skill lies. So there’s, if I take, two elements, one is can you have a great idea and not everybody can, but the people who can are gonna be really valuable! And the second is do you have the craft skills to make it as wonderful as it can be and being able to define exactly what you want to generate, which is what this technology does? That’s a craft. That’s how you’re going to get the perfectly crafted execution if you know how to ask for it.

I still think this is genuinely not a case where ‘any fool can do it’. I don’t think that is the case at all. I think what it means is really smart, really brilliant people can have ideas, and then people who really understand the craft can generate, produce those ideas.

Pat Murphy
Thanks so much to Andrew Robertson.

Next up, Nick Johnson, leading advertising law and digital regulation guru, and the global head of tech, media and comms at international law firm Osborne Clark. Our discussion included a question that’s certainly a hot topic right now; Can AI generated content be copyrighted?

Nick Johnson
Oh, it’s a really, really interesting point, this one, and it varies from territory to territory. So the US Copyright Office has come out and said that for purely machine created output they would not register copyright in that If a machine, if an AI is used as a tool by a human and the human is exercising some creative control and input in that, then that may be copyrightable in the US, but if it’s purely just to spat out by an AI, then no, that wouldn’t be registrable as a copyright there.

In the UK different story we under our law still have requirements of originality, but if the AI output of an artistic work or a literary work meets that originality requirement, then it should be protected by copyright in the UK.

In the EU it’s something of a mixed position in that literary works, artistic works created by purely by an AI, shouldn’t be protectable by copyright law, but sound recordings of any such work or a film of any such work would get some limited protection in the EU.

So it’s really different across different territories. I think the practical message there is if you’re using generative AI to create some work, some advertising work, for instance, you need to be using it as a tool to assist you with your human endeavour rather than just relying on the AI itself to do the creation. If you use it as a tool, you’ve got a good shout for saying that it’s protected by copyright globally. If you just take the output from the AI, there’s a big risk that, in some territories at least, there wouldn’t be copyright protection in what you have then created.

Pat Murphy
Another controversial matter is the training materials used by the tools to generate the so-called intelligence and the third party’s rights. I heard you talking about this issue in a webinar your law firm presented a few weeks ago. Can you explain that a little bit more for us?

Nick Johnson
Yeah, sure, it’s one of the big issues that’s being worked through in the courts at the moment. So the way that most AI and machine learning works is that you need to train it using masses of data, and it’s only through seeing massive amounts of data that the AI can identify patterns and learn from that data how to then create something itself.

And, of course, by training it on data, you may be infringing the copyright or other IP rights in that data, and so some AIs may have been trained on information just found out there on the internet and, of course, many of those items of information and content will be protected by copyright or other rights, and so there is currently a number of cases going through the courts where this issue is being explored.

Pat Murphy
Not least the one with Google, of course, the class action case with Google.

Nick Johnson
Yes, absolutely. So you’ve got. You’ve got a number of rights owners and, in some cases, rights owners acting as representatives on behalf of a class of potential rights owners suing those who have been operating AI engines and saying, basically, you’ve used my material, alongside a lot of other pieces of material, to train your AI and I never gave you permission. So it’s going to be down to the courts to decide whether that usage is actually an infringement of copyright and, if it is, what kind of damages should be awarded.

One suspects that over time, an ecosystem is going to arise and an understanding will arise where rights owners will get rewarded through a license fee for the use of their material to train AIs and that the courts the courts may recognise that that’s an appropriate thing to do. We’re going to have to see what these cases say, but at the moment it’s very much in flux.

Pat Murphy
Nick Johnson on just some of the challenges facing the future use of AI.

The final clip I wanted to bring you in this special episode of the MCA Prodcast comes from Melania Kulczycka, co-founder and client services director of Viewfinder Studios in Poland.

Melania has supported the execution of projects using virtual production technology for brands such as Beko, Bosch, Veet, Calgon, and many others. Not only is VP her speciality,  it’s also a real passion of mine and it was great to hear more of her expertise on the subject.

Melania Kulczycka
So one of the benefits of virtual production is that you have absolute freedom of creativity using VP, because you’re not limited by, for example, laws of physics! You can create any environment that you can think of. If you want to have a castle made of foam, for example, we can do it no problem, because everything is virtual. You’re not limited by any restrictions or permissions that you need to obtain. Maybe closing streets of New York, it’s quite problematic, expensive or sometimes even impossible to do, but with virtual production we can recreate the streets from the scratch, or we can scan the streets and then transfer them into Unreal Engine. So with virtual production you are limited only by your imagination.

Pat Murphy
I’m guessing from a director of photography perspective it’s much more controllable in a virtual production studio and of course you don’t have the issues around weather, if you’re a location, you’re in a studio, but you can control the lighting and decide how long you want to shoot, say the magic hour all day long if you want.

Melania Kulczycka
Exactly. You don’t have to wait the whole day for the magic hour, or you don’t have to wait for the rain, or you don’t have to wait for the sun. You can just have it straight away in our studio. You can shoot summer commercials during winter and winter commercials during summer, because we can create everything on our LED wall. And you know, it’s much nicer to be in a studio nice, warm and cosy studio rather than being outside when it’s very cold or rainy and shooting on locations where you are sometimes waiting a lot of time for the sun to show up or for the rain to stop or the snow to stop.

Pat Murphy
You are going to spoil it – these creatives, right, who love going on those locations, and they won’t be able to do that anymore if you carry on doing this. You know it’s a different way of operating, I know, but it means that a lot of this travel is a thing of the past as this technology progresses, I guess.

Melania Kulczycka
I know I hear a lot of that from our clients and the agencies that they, ‘okay, so that’s it, we cannot travel to South Africa anymore’. But yeah, unfortunately that is true. You know, with climate changing, it’s something that we should all be aware of, that we should actually limit our traveling, and COVID showed us that we can do everything remotely, so sometimes you don’t even need to fly to a shoot with BP, you can just be in your own country. So, yeah, I believe it should all change, or at least we should limit the travel, because we need to save the planet.

Pat Murphy
From a carbon footprint perspective, do you have much data to prove what the carbon footprint reduction actually is yet?

Melania Kulczycka
Yes, we try to collect data as much as we can, just to compare actually the traditional production with the virtual production. And we did a case. We actually calculated a case based on our previous commercial that we shot by the beginning of last year. We calculated the carbon footprint that was emitted during the whole process of producing the commercial and then we did a simulation. So we calculated the same carbon footprint if this commercial was shot using traditional production and it turned out that it would be about five times more carbon footprint to use traditional production than virtual production.

So of course, the main component is the travel. With virtual production you don’t need transport. You can just stay in one studio. But with this commercial it was, I think, about six different or seven different locations. So traveling to different locations just requires a lot of cars and a lot of company moves.

Also, accommodation, because we could limit the number of shooting days. We can shoot up to six different locations in one shooting day with virtual production, but with traditional production it’s quite difficult to get completely different locations within one day. So, yeah, we estimate that it’s usually about five times more eco-friendly virtual production than traditional production.

Pat Murphy
That’s a 75% reduction in carbon footprint by working in virtual production studio. That’s enormous. I mean, every single client should be thinking about this If they are serious about their sustainability plan. Right, it’s that simple, don’t you think?

Melania Kulczycka
Absolutely yeah. And there is a new law coming up in 2024 that all of the big companies will need to report their carbon footprint and they cannot exceed the limits. So virtual production will be helping with that.

Pat Murphy:
Melanie Kulczycka wrapping up this special episode of The Prodcast with some great insight into the future of our industry.

To find out more about the MCA Prodcast, please head to theprodcast.com where you’ll find details on all my guests, links to their favourite ads and full transcriptions of all the episodes.

You can also connect with us on LinkedIn, just click on the link in the notes to this episode.

If you’d like to feature on the next season of The Prodcast, coming early in 2024, or have any comments, questions or feedback please email us at podcast@murphycobb.com.

Thanks to my team at MCA and to my production team at What Goes On Media.
I’m Pat Murphy, thanks for listening, see you next time and have a great holiday.