Shrinking Budgets, AI Overload & Strategic Drift

Episode transcript

James Gill: Welcome to another episode of Content Conversations, with myself, James Gill and the co-host and founder of Method Marketing, Lucy Mowatt. We’ve got a bunch of stuff we wanna rattle through. trying desperately not to make it all about ai, all the time, all the ai all the time. we’ve got a handful of things to, to roll through.
should we kick off with a bit? Digital marketing outlook and forecasting for the next three years.
Lucy Mowatt: Yeah, I think that’s a good place to start.
James Gill: Okay. if you had a, a little minute to have a little look at some of these headlines, shall I read some of these out and I Yeah. Get you to reflect on some of the key takeaways?
I’ll, we’ll put the link to the report. I think it’s, e-marketing or econsultancy. This report is from, but it won’t surprise anyone who’s in marketing, in-house or agency side, none of this I think will come as much surprise. I think it probably vindicate much of the stuff that we feel ambiently through our own budgets, and through the things that are happening to friends and neighbours in agencies and on.
But that essentially the sector and the budgets are shrinking, and that that’s set to happen until 2028. I dunno if that, I dunno if that surprises you.
Lucy Mowatt: It is, I’d to know what they’re basing that on. the length of time in particular, while they think it’s gonna go on until 2028, I’d be interested to know why they think that.
I dunno if the article says, I can’t remember.
James Gill: Yeah, I think it, a lot of it’s around digital ad spend. and that ad spend that has been growing year on year for by 20% over the last decade, is, is now only growing, is gonna drop from 20%. 8% or nearly 9% by 2028. basically people spending less and less on ads.
They, they say that it’s due to macroeconomic uncertainty. the stuff that won’t surprise anyone. I wonder whether it’s because, and I know this is a complete confirmation bias, but as my rant for the last couple of years is as all these budgets have been crushed crunch, we’ve seen all that is digital, is that marketers are saying,
If we’ve only got this much to spend and I’m being hammered on ROI and leads, leads, leads, sales, sales, sales. I’m not gonna put stuff into nice fun brand campaigns, creative campaigns. Mm-hmm. We’ll we’ll focus for, for the minute on Low hanging fruit, quick wins, et cetera. And that is always performance.
And what that’s done is it’s driven the cost per click up. And we’ve seen that over the last couple of three years, that cost per click, cost per lead, et cetera, has all gone through the roof. I wonder if there’s gonna be a bit of a, a backlash against it. ’cause there is no money. It’s become, it’s not worth paying, someone to manage an account that GI gives you an ROI of, a penny.
Lucy Mowatt: But again, it comes back to that shortsighted thing with long term and short-term benefits and I can’t remember what the, the study is, but over the long term brand building always has better returns.
James Gill: Yeah, absolutely. again, it’s, you heard me say endlessly, it’s the pension. You’ve gotta pay a pound.
of your wages now, and you won’t see it, it won’t feel it’s doing anything for quite a long time, but when it does, you thank God you’ve got it. and it, it compounds and all the analogies that, that also work. digital ad growth is down. what else does it say? It’s interesting, it says that media habits are stabilising, that plat platforms are now in a zero sum game with one platform’s gains increasingly coming at the expense of another.
I wonder if that is, there are many social platforms. You and I have both seen it over the last 15 years when there’s a new platform that emerges most recently TikTok. But I remember when. Vimeo and YouTube. Were battling it out people. Oh, there’s another one. Oh, there’s a new one.
It’s called Twitter. we need to be on Twitter now as as Facebook, and MySpace. And every, everything gets divided and divided and divided. And budget gets split and split and split, and the people’s time gets split and split. I think. sorry, I don’t think this is what they’re saying is that people are focusing on key channels.
This is our channel. We’re on LinkedIn. This is gonna be our channel. We’re Reddit and Quora.
Lucy Mowatt: that makes total sense, and again, it’s something that I recommend to all clients when I’m working with ’em, when they’re oh, let’s start an Instagram channel. And I’m why are your audience there?
Or are they on LinkedIn? And maybe we should go all in on LinkedIn because that’s where they’re active.
James Gill: Yeah, absolutely. I think, everything seemed a good idea. And, we’ve all worked with B2B clients who are oh, we should be on Pinterest. why? You’re you’re a recruitment agency, whatcha are talking about?
Or, or something that’s,
Lucy Mowatt: you have nothing visual to share again. that whole Instagram thing, oh, we wanna be on Instagram. We should start Instagram camp. Okay. Who’s supplying the pictures for that?
James Gill: Yeah. Are your audience there.
Lucy Mowatt: And, you’re a service business, are you. Ha where are you taking pic pictures.
We’re not gonna share stock imagery if, if you don’t have anything new and innovative to share.
James Gill: Yeah. another interesting one, I know I said I try not to make it all about ai, but they said that ai, while it’s still a very small bit of ad spend, it is growing. they say it’s gonna grow from 0.7% of total search ad spend to 13% by 2030.
Now that seems a long way, but it’s five years. It’s not tons. I think it elsewhere. They also say that adoption is, is unclear because it’s, it’s rapid, but it’s also in certain areas and not others. that’s too early to say. the big thing I, I think, it’s interesting is they talk about agent AI and how that’s reshaping product discovery, especially for low ticket items.
it’ll be interesting to see the impact of when we plug our GPT into email, CRM, HubSpot, all these other things and how that will, Impact budgets and activity.
Lucy Mowatt: Mm-hmm. Yeah, that is interesting. ’cause at the moment I don’t think there’s much of that happening.
James Gill: I think what would be tragic is that small and medium sized companies won’t be able to get into that first.
it’ll be big companies who have whole ops teams and IT teams who will be able to. Pay devs to work with agent ai, make or whatever, to say, how can we streamline these whole systems? how can we, invest in this and then we’ll get off the shelf ones further down the line. I would think,
Lucy Mowatt: yeah, that’d be interesting.
As, as you say, it’s a, it’s a rapidly evolving market, I think even in 30 days alone, 2030 things will look different.
James Gill: Yeah, absolutely. it says that retail, retail media is booming. I’m less in the retail space. I think you, me neither have more experience with that. but apparently, yes, retail media is, is from a lot of the digital marketing budgets.
What it say here, despite tariff threats, retail media ad spend could hit, 56 to 61 billion this year. it’s a big number. I dunno really what it means to be, it doesn’t have a growth percentage in there. I guess people are battling it out.
Mm-hmm.
James Gill: with, with ads, it also adds to that says that e-commerce is is holding up, holding up
Which is interesting. again, I, I would have to drill into these to see if there’s any particular things that are driving that, whether it’s the new iPhone or Xbox or, whether it’s generally, is it a trust and adoption thing? Are people happy to buy stuff online or are there people who are more traditionally offline who are still arriving online with new shops?
you and I both know people at Shopify and, e-commerce web build agencies that. Going great guns still. clearly people are investing in it. maybe that’s, not that surprising.
Lucy Mowatt: also the High Street is dying if you go. our local city is obviously Norwich. There aren’t many clothes shops.
you can’t go out and buy many clothes in Norwich. same with hardware stores. If you live in a city, there’s nowhere necessarily to buy anything. I think a lot of it is to do with convenience because you can’t buy much on the High Street. People are going online. Also, again, a coming of age, as you say.
As older generations get more with the internet, it probably will increase that spending online as people become more confident.
James Gill: Yeah. And, and as you say, I think it’s that slightly a spiraling thing where, people might have gone to the high street, but if it’s not there on the high street, then they will go online.
And and then if you’re online, then there’s no point in having a high street. it’s a it’s a gravitational pull. That’s, it’s not rosy, but I guess it’s a recession. It’s what happens in a recession. We haven’t had one for, since 2007, 8 0 9, and 10 obviously when, when we were in, in recession,
Lucy Mowatt: technically there was a recession in 2020.
James Gill: And that’s, that’s what I was gonna say is the other point is that there’s this binary idea of either in recession we, or we’re fine, but. the graphs, it’s basically basically been pretty flat. we’ve had the jolts of COVID, a death, not death, a crash in the stock market because of, COVID obviously.
And then everyone went mad afterwards and spent loads of money. But it’s all evened out and there’s a pretty straight line through that since about, yeah, 2012 ish, in terms of salaries and business growth and, and on. it’s It’s a bit flat. maybe it’s a soft landing recession.
We’ll have to see what happens. It’s funny history tends to repeat itself despite the amount, the amount that you say, oh, we’re in unprecedented times. Or, this is this time it’s different. But I do feel tempted to say that I, I do think it’s different this time. and I really genuinely think that AI are gonna be a massive part of that.
If not, it’s actual impact. The fact that people aren’t willing to, I dunno, hire new people or pay for things when they know that AI is coming to fix that problem for free Pretty soon
Lucy Mowatt: I had, I was having an interesting chat with, a marketer that we both know, and she was saying that one of her clients is heavily into ai, is always using it.
and that she ran an ideation creativity session to come up with ideas for pr. They came up with some great ideas and she was developing them. And then after the session, the client came back and went, oh yeah, but can we ask ai? having done all that work, it decided to defer to AI above the human creativity and the ideas that they’d come up with, which I think is interesting and slightly sad.
James Gill: It is. It goes back to, I’m not sure whether we’ve discussed it on the pod before, but, the idea, gen Z, gen Z don’t trust. Experts, they trust tools. and I think that’s probably what happens if you grow up with a phone in your hand. and everything is mediated through technology. it, it feeds into that is that I I don’t know that I trust you as a person enough, whereas I’ll ask GPT and, and, oh, thank God Trust.
Which is ironic ’cause I see many particularly Gemini boo boos, of things that gets wrong endlessly in my LinkedIn feed.
Lucy Mowatt: Yeah, I, I think, I think there’s a lot of excitement. It’s, there’s a lot of novelty, there’s lot of early adopters who are going out and going, oh yeah, create a load of content and create a load of LinkedIn waffle.
But I think over time it’ll become. More refined, more skilled. I think with, SEOI remember back in the day when s started working at SEO and people were writing keywords at the bottom of their pages, a, a business would have loads of keywords related to Britney Spears in white text and a white background at the bottom of their page to try and stuff, keywords and things that.
I think possibly AI will be a bit more that. Its abilities and also our human ability to deploy it will become more refined hopefully over time.
James Gill: It’s very interesting leads to my next point. Something I was, again, it’s ambiently this conversation’s been having, but to really pin the point is that I think, taboos around AI will be broken down.
it’s clearly, it’s too cheap, it’s too brilliant, it’s too easy, it’s too quick. and even people who are, if we are nervous about using it or saying that we use it, I think that will start to be chipped away at. And I use social media as, as an analogy relevant one. I remember in 2005 six the idea that you would use social media at work at all.
Because obviously there was no role for it. in the work. In the work. What would you do with, with it? But it was emerging that some companies, I worked at a music magazine, it made sense that we were talking to people. ’cause our audiences were young blokes mainly, and they were on Facebook. we used this emerging channel for Facebook and after a while it made sense.
Oh we could use it for a business, should have a Facebook page. Surely. ’cause then you have an audience and, but people were, were a bit no, we’re not gonna do that. It’s, it’s, it was what am I trying to say? It was a new thing. It was, it was an innovation and people resisted that change, because it felt a cultural mismatch to have a business on a Facebook page.
And I think that’s the same with ai.
Lucy Mowatt: I think that also the platforms themselves saw the opportunity, their rollout of business tools also facilitated that. I remember businesses having Facebook profiles. And that was when it seemed, yeah, it was the wild West where, there was no, what am I trying to say?
There were no, there was no analytics, there was no control. It was be a friend with X company. And that has changed. And you’ve got Facebook pages that related to businesses. LinkedIn developed business pages. ’cause back in the day, those didn’t exist. I think the, the platforms themselves have seen the opportunity to appeal to businesses and have built the.
The, the tools that businesses and marketing teams want to make it more, I guess more palatable in some ways. and you get a first few front runners and a FA few early adopters, and then other businesses start rolling on until you get to the point where you’ve got, you’ve got brands that are going, oh, should we boo on Instagram?
Even though there’s, it’s almost it’s gone too far the other way with businesses going, right, we should have a TikTok account, we should have an Instagram account, we should have LinkedIn, we should have X. And it’s and a thread and a blue sky, and you’re whoa, there. it’s almost it’s gone too far the other way.
James Gill: John, it’s funny, I hadn’t thought of it, but you’re absolutely right. Because as many people will know, you can have a, a corporate, GPT account, I think it’s 200 bucks a month and gives you infinite deep research and, various bits of pieces. they’re already gearing the tool up for, specific business accounts and business uses.
yeah, I, it’s it’s too good, for it. Chipped away at, and I think we, we have talked about it on here, the, the LinkedIn blister pack, put yourself as a, blister pack that meme. It’s a real, gateway drug. I think people will have seen its power, seen the ease with which you can use it.
Everyone I’ve shown, it says, oh, is that it? You it’s Google and it’s a. A chat bot and you’re yeah.
Mm-hmm.
James Gill: oh, maybe I will use it then because it’s it’s it’s too easy to, low cost. that’s, that’s my prediction.
Lucy Mowatt: But there has been an article to, as a counterpoint this week, and I, I’ll be honest, I haven’t completely read the article.
I saw the headline. but it’s that this conversation has prompted it in my head is that there is now research saying that AI use makes pe, affects people’s brains. And it’s negatively affecting people’s brains. I think relying on it. creativity is a muscle that has to be flexed. if you are relying on AI to come up with creative ideas, then your own ability to be creative or you’re not practicing it, it drops away.
I’d be interested, interested to read the article properly, after this video.
James Gill: you’re right, I remember it. It was, was it, the one about how, universities. People are getting, GPT to write their essays. And the problem with that is that it’s not about producing an essay. It’s gonna sound very obvious maybe, but what does the teaching is the.
Preparing to write the essay. Writing the essay is what teaches. and if you haven’t gone out and done all the reading done, all the structuring and all that stuff, you haven’t learned anything. And what they’re seeing is that they’re getting these amazing essays handed in, but when they’re asked questions about it, they have no idea.
And that’s obvious, but the thing being that yes, we, as. We would, be new to a client in a sector, know nothing. You write 10 blogs, 20 blogs, and before it, you’re an expert on, on their subject matter. and I guess depending on the level of usage of, by content creators, that will happen.
People might say, I’m, I’m happy with that trade off. If the content is good and I get more of it because you’re more productive. Great. And we of course. experts in using GPT rather than experts in any given subject.
Lucy Mowatt: it’s interesting, it brings me onto a topic that I saw, an article on search engine land, before we came on this call, which was the title was SEO Copywriting in 2025, and it was a bunch of what I would consider common sense.
That’s how you should be writing articles anyway. I think the first point was to be human centric and it’s yeah. That’s the point. Whether you’re writing for a magazine, whether you’re writing for web content, it still has to be created with the audience in mind and, and one of the other points was what makes it unique?
I was and what makes your take unique? It’s yeah, obviously. ’cause otherwise you’re scraping the internet for stuff that already exists. And I’m how is this? The advice that’s being given out. it feels obvious as someone who’s a writer. But I dunno if it’s appealing to people who maybe are stepping into the sector, people who recently graduated, or people who are using AI all the time.
I, I dunno what your thoughts are, whether I’m being overly sensitive as, as someone who’s got a writing background, that this seems it’s really dumbing down and really obvious.
James Gill: It’s interesting, there’s many interesting things to say to that. If I was being catty, I would say that GPT is allowing people who aren’t writers to.
Become content creators. And again, the difference between a content creator and a copywriter, often they’re both, you and I, I think are both. but yeah, is that, if you’re a marketing manager, and let’s say you’ve been doing it for eight years, you’re not really a, a journalist or a writer or an editor.
And this knowledge is new to you. Anyone else who’s come up. Editorial publishing, content marketing, SEO writing, they will know about writing. Whereas all these other people who have arrived at, oh, I’m now responsible for creating the blogs for our website using GPT, and I’m a marketing manager.
I, I’ve done a bit of PPC maybe. but that is gonna be news to those people. They, they do need to, to learn it at that stage.
Lucy Mowatt: Maybe I’m being hypersensitive, and it comes back to that point you made in a previous episode around how marketers have to wear all of the hats.
James Gill: increasingly, yeah. It’s funny.
Here’s a really fun, game is if you go to any job website and click put in your job title and see how many jobs there are, get the job ad and put, put it to GBT and say, how many roles is this? I’ve done a couple that have come back with two and three. Oh, this, this looks a job for three people because it’s got three disciplines and, and what have you.
I dunno. the feels, feels funny.
Lucy Mowatt: on the common sense front. There was also another article again, I literally saw this morning, I think it was the Content Marketing Institute, and it was about how marketers aren’t being strategic anymore. And again, I know we’ve touched on this previously, but again, it seems to be a recurring topic that everything is very short term.
again, maybe it’s to do with the economy, but everything’s very tactical. And even if you have a strategy, it’s very performative and that you’d go through the exercise and then frankly ignore it. I dunno if you’ve seen that. I certainly have. I’ve worked with brands where, you’ve spent months coming up with a really in-depth strategy for how you’re gonna take the business forward.
And then a stakeholder comes along and says, yeah, but we wanna advertise on this roundabout. And you’re yeah, but that’s not part of the strategy. It’s not part of reaching our audience. And yet somehow that overrules the strategy and the strategy falls by the wayside and you never come back to it.
I dunno if you’ve had that experience.
James Gill: And, and many thoughts around that. One, I think is an idea that strategy is too hard to implement. and you you do tactics because there are many channels now, to be strategic is very difficult. sorry. It’s increasingly difficult. A, it’s difficult.
B the pressure is for whatever you can do tomorrow. Not what’s gonna happen next year, not we’re on this nice curve of growth, let’s continue putting money in our content marketing pension. Bit of title, brand pension. you’ve got that. You’ve got the, the no one thinks you can, Implement strategy, it’s too difficult.
And then the other thing, which I always think is interesting is related to that second point is people act in the interest of their job and not in the interest of the company. what marketing manager or marketing director is going to turn to their, the MD, CEO, whatever, and say, I’m sorry, I’m not prepared to move all of our budget to PPC and performance to drive leads tomorrow.
Because I want to continue to build our brand through a bit of digital pr or social media or brand ad campaigns because no one’s gonna, no one’s gonna do that, because it’s not in the interest of their job. I’d rather do it. How do you get
Lucy Mowatt: away from that? How do you get there? I suppose my thing thinking is, even if you’ve been through the strategic process with that stakeholder, you’ve demonstrated, what you’re trying to do over the longer term and the tactics that are involved in that.
Surely it’s better for the job in the long run, in
James Gill: the long run to speak with
Lucy Mowatt: the strategy. I know. Maybe that’s what it is.
James Gill: I think as we’ll have all have seen this is you, you go through the, the strategy with senior leadership and they love it and it’s great. But then there’s a bit of a disconnect where you get to the actual tactics and they’re we don’t wanna do that.
Or budgeting, love the strategy, but don’t wanna spend any, any more. There’s a disconnect between saying, what the strategy means, right? It means that we’re going to be doing 50% performance and 50% brand. Really? Is that what that,
Lucy Mowatt: but surely in my experience, a good bud, a good strategy will have a budget.
Factored in. Sure. And, and, and certainly the plan that falls out of the strategy should have a budget factored in. I dunno, I, I find it really difficult. I feel it’s really common sense that you have a strategy and a plan, but my own experiences such that marketers don’t have any control over whether that’s enacted or not, especially if there’s no one at C-suite level representing marketing.
James Gill: Another thing I’ve heard is the idea that strategy particularly sorry, particularly content strategy is baked into everything. And I was oh, that’s interesting. What does that mean? I think it’s that more and more companies not doing it but are conscious of brand, what’s your brand?
our brand stands for brand values and that filters through. Everything. it is a little strategic, you don’t have a formalised content strategy. ’cause if you have a brand strategy and a marketing strategy, a marketing plan, and a brand strategy, that becomes your, your content strategy.
people aren’t buying it or wanting it off the shelf because it’s already starting further upstream, which I thought was interesting because not necessarily something I’ve seen tons of, but certainly a bit of where. Is really directing about how they want to position themselves in a way that, I think that was probably a marketing role thing 20 years ago.
Maybe it says more about the companies that I work with.
Lucy Mowatt: I think it probably does. I think when I do strategies, I come at it from ’cause of my background. I come at it from a content first perspective. I suppose it depends on maybe the marketer or the, the business that you are working with, they will lead with their lead discipline.
James Gill: Yeah, I certainly see, marketing strategy as through a content lens.
Mm, me too. I
James Gill: often have to go, Ooh, ads shit. after thought. I’m not sure if you wanted to cover off. There were a couple of other bits or whether we bank those for, for next time.
Lucy Mowatt: let’s, let’s quickly run through what you’ve got left on your, agenda to runt about.
James Gill: Okay. it wasn’t, it wasn’t much a rant, I thought it was, I’m gonna try and tie these two bits together. People would’ve seen, I think the company called Calci and they had the first ever entirely AI generated video that aired on, the American equivalent of the terrestrial, I’m not sure what it’s called.
Big channels. amazing looking video. and not. It, the, the ad, the ad itself is, is quite fun. But it’s the fact that it’s ai, I guess that makes it interesting and impressive, and I’ve been thinking about this for, for a week or is the thing with humans is. We get a lot of meaning from eyes.
it, this won’t work for anyone listening, but if, and, and even if you are watching, the subtleties of this, may be slightly lost, but hopefully I’ll be able to explain it is if I wave my arms around or do things, signals with my arms, of covering a lot of physical ground in doing that with my hands, but it doesn’t necessarily carry much meaning.
Whereas if you do ever such slight movements to your eyes. We can express the difference between suspicion, anger, contempt, love, surprise in microscopic almost, millimeter movements in our eyes. And that is the bit that AI will find very difficult is that it needs to hyperfocus on the different what is emotional or what is sad eyes.
What are happy eyes. It’ll know the extremes maybe, and get those earlier. The subtleties, and I think there’s a Reddit meme called dead eye. It’s ai dead eye. this idea that people are doing crazy really fun things, but in, when they say about people who don’t smile with their eyes.
the people who are laughing and still, it’s this dead eyed look. I’ve no doubt they’ll master it. But that was something that’s in that video is that all these people are doing these mad crazy things jet skis and flying around, but their facial expressions don’t mirror that of a real human.
Were they doing a bungee jump?
Lucy Mowatt: It’s the, it’ll play into that uncanny valley thing that you have with, with CGI and AI is that people find it a little bit creepy and I think I watched some of that ad and then stopwatch it, ’cause it felt a bit weird. It was a bit a, a fever dream and I didn’t it.
James Gill: Yeah. I would say apparently it cost three, three grand to make, which is insanity, particularly watch it. Yeah, we’ll, it’s clearly the, there’ll be more of it and we’ll see how they deal with the eyes.
Lucy Mowatt: We’ll put the link in the, show notes that people can go and watch it for themselves.
James Gill: Great stuff. thank you very much for, if you’ve made it this far. Thanks for listening. thank you to Lucy, and we’ll see you next week for another episode of Content Con Conversations,
Lucy Mowatt: easy for you to say.
Thanks very much. Bye.
Why isn’t it stopping? Okay, there we go.