The Unhousing Trend
The grass is always greener on the other side of the in-house fence.
Five to 10 years ago, many large brands began in-housing their media and/or creative agency services.
This was justified as a cost savings, with the idea that brands could manage their own tasks and avoid additional agency or vendor fees. However, as Ad Age reports, the pendulum is swinging for some in-house agency teams.
Keurig Dr Pepper’s in-house group, called Liquid Sunshine, was unexpectedly dismantled last month. Suntory Global Spirits shut its in-house agency last year. And Pepsi recently shifted some of its in-house work back to VaynerMedia.
“When you have the enterprise consultancies coming in, they look at the internal agency the same way they look at a copy machine or the catering,” says Fred Schuster, CEO of InnerGroup, a services operations provider for in-house agencies.
“If we do it right, [saving money] will be a byproduct of doing this,” says Darren Moran, who helped form Liquid Sunshine in 2020 and served as creative chief through 2023. “But when you create an agency just to save money at the macro level, then every individual decision you make comes down to controlling expenses.”
Pinch And Scrape
Big online platforms and consumer AI operators (OpenAI’s ChatGPT, Google Gemini, Anthropic’s Claude, et al.) are finding out what it feels like to have their data scraped.
And now they’ve gotta figure out how to deal with it. Guess the shoe is on the other foot.
Reddit is a useful example because of its groundbreaking data licensing deal with Google – but also because Reddit is a hybrid open-closed platform. Many subreddits are scrapeable, so they appear in search results, and non-users who aren’t logged in can read them.
On Wednesday, Reddit filed a lawsuit against Anthropic alleging that the Amazon-backed generative AI search company scraped its data. To be fair, the data was there to be scraped, but the practice goes against Reddit’s terms.
Recall that last year Google considered suing OpenAI for having unabashedly scraped more than 1 million hours of YouTube videos to train ChatGPT. Except, awkwardly, Google did the same for Gemini, so it held back.
State Of The States
After a better-than-expected Q1, the ad industry has slightly more optimistic growth projections for 2025.
That’s according to Madison and Wall’s Brian Wieser, who previously predicted a 3.6% growth rate in US ad spend this year in anticipation of a tariff-related pullback. However, in an update released this week, Wieser revised his projection to 6% growth.
Why? Mainly because US advertising growth was solid in Q1 at 9.7%, which represents a “slight acceleration” from Q4’s 6.8% growth, Wieser writes.
But what explains the strong Q1, given all the tariff doom and gloom?
For one, tariffs created a “pull-forward” effect, as many consumers stocked up before expected price hikes. Brands, meanwhile, ramped up imports and marketing to secure a greater share of this spending bump.
Imported goods accounted for 43% GDP growth in Q1, according to Wieser. If imports remained at typical levels, GDP would have grown by just 2.7%.
Also, foreign manufacturers may have boosted their spending ahead of the removal of the de minimis tariff exemption on low-cost goods. And retail media networks have taken steps to increase on-platform spending, such as allowing competitive conquesting.
But Wait! There’s More
The messy end of the pageview economy. [The Rebooting]
A short video app with lots of terrible, explicit content called XShorts – no relation to X – was miscategorized by Google as appropriate for ages 13+. And so ads from major brands were programmatically served in highly inappropriate contexts yet again, of course. [Adweek]
You.com, an AI search startup, is in talks with Cox Enterprises to raise funds valuing the company at $1.4 billion. [The Information]
MIT crunched the numbers on AI’s energy usage. [MIT Technology Review]
You’re Hired
StackAdapt hires Patrick McGill, formerly a political accounts leader at The Trade Desk, as director of its political client services. [Adweek]
