ITV’s new gen AI ad-making tool for small businesses opens the gate for a flood of video advertising content that may drive up CPMs for the whole industry.
On 9 October, ITV announced that it had partnered with the sell-side advertising platform Magnite to launch its GenAI Ads Manager, which will allow small- and medium-sized businesses to create ads in under thirty seconds.
ITV’s new service will leverage Magnite’s streamr.ai technology to create BCAP Code-compliant AI-generated ads at a low cost.
GenAI Ads Manager will enable ‘thousands of SMEs to create broadcast-ready ads in seconds,’ said Jonathan Moffie, head of agentic product at Magnite. Media analyst Ian Whittaker described ITV’s move as potentially ‘revolutionary’, if it’s executed well.
‘Big money in the UK advertising market really comes from SMEs. There is no exact number but, given digital is over 70% of UK ad spend — and in a market such as the UK — SMEs represent probably c 75-80% of Google’s Search and Meta’s spend, the opportunity is huge,’ Whittaker wrote on LinkedIn.
In order for it to succeed, Whittaker says that the broadcaster needs to market it ‘as aggressively as possible to SMEs’ and focus on making the platform ‘as easy and simple to use’.
But what happens when everyone starts producing cheap, AI-generated video ads?
In his Marketing Economics substack this week, Henry Innis, co-founder and CEO of Mutinex, predicted that ‘video CPMs are about to explode’ because generative AI will open the doors for ‘millions of previously priced-out SMEs’.
‘The great promise of AI in advertising was cheap creativity at scale,’ he wrote. ‘That promise will be fulfilled. The uncomfortable truth is that cheap creativity begets expensive distribution.’
He predicts that video CPMs will rise steeply and ‘faster than most planning models expect’. As such, he advises media planners to revise their forecasts if their plans assume that video CPMs will ‘track gently with overall ad inflation’.
‘Update your planning curves quarterly and treat any comfort from “last year’s cost” as a bias to be corrected. If your finance team demands stability, give them transparency instead. It is better to forecast a 30% CPM increase and prove yourself conservative than to promise flat and spend the year writing variance notes,’ Innis advised.
