InterviewAI hype bubbles as companies fall short of full adoption

Against a backdrop of soaring investment in artificial intelligence (AI), companies are still largely experimenting with the technology rather than overhauling their businesses, advertising veteran Martin Sorrell said, as a lack of economic pressure slows the shift toward widespread adoption.

Sorrell, executive chairman of S4 Capital and former CEO of WPP, said companies have been slower to adopt AI at scale than the market’s enthusiasm might suggest, with businesses reluctant to fundamentally change operations that are still performing well.

“The sad reality is that people only change when there's an existential threat,” he said in a recent interview with The Korea Times. “People don’t change voluntarily at this scale.”

Despite heavy investment in AI infrastructure, Sorrell said spending on the technology should not be mistaken for a fundamental shift in how companies operate. Most businesses remain focused on experimenting with AI rather than committing to large-scale transformation.

“My view is that you will not get huge implementation transformation until there's economic pressure to do it,” he said, adding that companies are not yet under sufficient economic pressure to make the shift.

“What (the companies are) doing is experimenting, they are testing, auditing and launching test programs to see whether there is a benefit and things can be improved.”

He said that companies facing existential threats are more likely to move aggressively, citing automakers under pressure from Chinese electric vehicle makers, financial firms challenged by fintech companies and consumer goods businesses squeezed by margin pressure, slowing growth and geopolitical uncertainty.

The picture is different among consumers, who are adopting AI much faster than companies. He noted that businesses face greater bureaucratic hurdles, as well as concerns over intellectual property, legal liability and the risks of deploying AI across complex organizations.

Sorrell, an ad mogul with decades of industry experience, said AI’s biggest disruption may come not in creative production but in media planning and buying.

“The real impact (of AI) is going to be on media because that's where the algorithms will have the most impact,” he said.

Generative AI has drawn attention for its ability to produce images, video and copy. However, Sorrell said while AI tools are likely to lift the overall quality of creative work by eliminating more mediocre output, human creativity could become more valuable in producing exceptional work.

“Because everybody can use the tools, the brain, the human element, will become even more important,” he said.

But he expects AI to have a bigger impact on media planning and buying, where algorithmic systems can automate data-driven decisions on audience targeting, campaign allocation and media investment.

As advertising becomes increasingly digital, Sorrell said such decisions will increasingly resemble investment management, with algorithms playing a greater role in determining where and how advertising budgets are allocated.

Turning to Korea’s growing global cultural influence — from music and drama to beauty and food — Sorrell said he does not see the K-culture boom as a passing phenomenon.

“I don’t think it’s a one-time thing,” he said, adding that Korea has further room to expand globally across technology, cosmetics, food and entertainment.

For Korean companies seeking growth overseas, Sorrell said one of the biggest challenges will be balancing global scale with local relevance as geopolitical tensions and trade barriers make markets increasingly fragmented.

He said global companies will need to become “much less centralized,” giving regional and local operations more flexibility to respond to differences in culture, consumer behavior and market conditions.

Sorrell added AI could make that shift more practical by allowing global companies to adapt content and campaigns for individual markets at much greater speed and scale. Instead of creating separate campaigns from scratch for each market, companies can increasingly produce a core set of assets and tailor them to local languages and cultural nuances.

“The technology favors flexibility,” Sorrell noted.