What the Agency AI Survey results mean for PR and marketing firms

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Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, as, as we sit here on a Monday and record this, I am truly optimistic. I have published my planned photo schedule for the evenings this week, and despite the fact that- … it says it’s gonna rain Wednesday, Thursday, and Friday, I still have games on that calendar, and I am optimistic that we will actually get those games in even though they don’t generally play baseball and softball in the rain.

Gini Dietrich: I don’t know if that’s optimistic or masochistic.

Chip Griffin: Oh. No, masochistic would be they were lacrosse games and I know they’re gonna be played in the rain, and I’m still looking forward to getting wet while I take the photos.

Gini Dietrich: And you’re still looking forward to it.

Chip Griffin: No, I suspect if the forecast is what it is, I think it is highly unlikely that any of those games will be played.

Gini Dietrich: Well, good, then you can be optimistic that you don’t have to go and shoot photos.

Chip Griffin: There you go. Yeah. I can be optimistic to have some, some evenings to catch up on, on real work instead of-

Gini Dietrich: That’s right. That’s right …

Chip Griffin: photography. But- That’s right … optimism is kind of the theme of the day here though, because we have recently completed the SAGA Agency AI Survey, and it, it turns out that agency owners, to nobody’s surprise, are eternally optimistic, and they are astoundingly optimistic about AI, and how they’re using it and what it means for their businesses.

Gini Dietrich: Yes, indeed. So I looked at the results, and that is my takeaway as well, is that they’re extremely optimistic.

89% have regular or widespread use, 74% use it every day, 89% expect AI use to grow over the next 12 months. And so, yes, it is very optimistic. 88% report productivity gains, and 79% report quality gains.

Chip Griffin: It is amazing how much work AI is doing for agencies today. It is, it is frankly unbelievable, and I mean that literally.

Gini Dietrich: Literally, yes.

Chip Griffin: I do not believe it. Yeah. I have either stumbled across a sample of the earliest adopters who are most interested in AI and have really taken it the furthest, or more likely, people don’t really understand what’s out there and so therefore think they are further ahead than they are.

Gini Dietrich: Yeah.

I think it’s… Well, I mean, I will, I will say that the head of, the ahead of peers piece of it, so the data said that 53% believe that they’re somewhat or further ahead than their peers, and only 13% think they’re behind. That’s mathematically impossible. And so I think my take on it, and I’d love your take as well, is that they’re grading themselves on their usage and not on the operational depth of it.

So for instance, they’re using ChatGPT every day as a habit, but they’re not operationalizing AI as a business model, and I think that 53% are confusing the two.

Chip Griffin: Yeah, I mean, I, I think it’s probably a multitude of factors. I think part of it is that agency owners visualize a very low bar for their peers when it comes to AI.

Gini Dietrich: Okay.

Chip Griffin: And I, I think part of that is that people aren’t hearing a lot of examples of how agency, other agencies are using-

Gini Dietrich: Sure …

Chip Griffin: AI. They’re not as active as some of us may be in going out and seeing how other industries, similar industries are using AI and really testing the limits and understanding what’s possible.

So I think part of it is that they don’t have an appropriate baseline to know whether they are indeed ahead or not because they’ve set the bar so low in their own minds. And I think that part of it is, you know, this point that if they’re just using it at all, they think that puts them ahead.

Gini Dietrich: Yeah, I think that that’s what’s going on.

I think that they’re, that they’re saying, “Well yeah, I use it every day.” And that’s, and that’s what makes them think that they’re ahead.

Chip Griffin: Right. But I, I think as we dig in deeper and we look at how they’re actually using it, it’s pretty obvious that, that most of the usage by these owners is what I would call generative AI 101.

Draft me an email. Yep. Help me create a blog post or a social post.

Gini Dietrich: Yep.

Chip Griffin: It is– There’s nothing in this data that suggests that there is widespread innovative use of it, widespread use of it for internal operations or for business development or any of those things. It really appears to be sort of the basics, sort of the things that people were talking about a year or two ago in terms of generative AI, and that seems to be where most of the activity and most of the stated value is.

But even in those areas, there’s a good swath of agencies that aren’t even doing that.

Gini Dietrich: Right.

Chip Griffin: I think the, if I recall correctly, the number was only like 74% are using AI to help revise or edit content. It’s mind-boggling to me that that’s not almost 100%.

Gini Dietrich: Yeah, I agree. Yes.

Chip Griffin: Because it’s the easiest way to improve the quality of your content.

Gini Dietrich: Yes, it is. Yes.

Chip Griffin: So I just, I can’t even imagine not just saying, “Hey, take a quick look at this.” I mean, even if it’s just to proof it. Just take a look through- Right … make, make sure I haven’t- Right … missed anything obvious here, and you know. Right. Because anytime I run it through, it tends to find something.

Gini Dietrich: Yep.

Chip Griffin: So why aren’t you at least doing that?

Gini Dietrich: Yeah, I mean, it’s funny you say that because we just submitted an article to PR Daily, and I know that Allison Carter is a huge, huge, huge, huge stickler for AP style. So I have an AP style agent, and I ran it through there, and it, I think it got five or six different things that I had missed.

I was like, “Thank heaven.” Like, ’cause she, she will send it back. She’ll be like, “Nope.” I mean, huge stickler. So, and like, yes, to your point, like you should be using it for that, 100%.

Chip Griffin: Yeah. I mean, that’s just– to, to me that’s a very basic use, but there are so many great things that you can do with it. I mean, the, the tiny percentage of people that are using it for anything design related-

Gini Dietrich: Right.

Yeah … was- It was almost 0%. Yeah. Yeah. It was, it was shocking to me- It was shocking, yep …

Chip Griffin: that such a small percentage seem to be using it for that, at all. I mean, we didn’t say you’re using it for every image or every video or those kinds of… But if you’re not even experimenting with it-

Gini Dietrich: Yeah …

Chip Griffin: you’re missing a real opportunity because there’s a lot that you can do with it.

Now, I don’t– you know, one of the things that, that I don’t know is, you know, what percentage of these people may not do this because they have the ethical concern, right? And I’ve, I’ve been at a few events recently and watched a few talks online where, you know, there, there’s, there is an, what I consider an unnatural resistance to AI because of use of electricity or-

Gini Dietrich: Yeah

Chip Griffin: or because of- Data centers and, yeah … concerns over copyright and that kind of stuff. And so it causes people to swear off the platforms and tools altogether, rather than saying, “Let’s try to find solutions to all of these things.” And l- and let’s face it, there are solutions being sought for all of it, whether it’s the electricity angle, whether it’s the copyright angle. There’s a lot of work being done in that area, and for individuals to just say, “No, I’m just, I’m not even gonna do this,” is extraordinarily shortsighted in my view.

Gini Dietrich: Oh, 100%, yeah. I, I mean, I think we’ve both talked about this ad nauseam, that you should…

I don’t believe that AI is going to replace us. I believe that people who know how to use AI effectively are, is what’s gonna replace you. So if you’re putting your head in the sand, you are, you will be replaced for sure.

Chip Griffin: Yeah, absolutely. I, I think the other place that was interesting, and you flagged this in, in your pre-show notes, is that they’re reporting largely productivity gains, and yet revenue seems to be flat or declining. Doesn’t really match up.

Gini Dietrich: Nope. Again, doesn’t work. AI’s making everyone faster at work, but it’s not growing the business. That is not what we’re trying to do. So what it tells us, right, is that AI is being absorbed into the existing scope There’s silent commoditization so that clients are getting more for the same less, for, for the same fees, so we’re, we’re over-servicing.

We’re filling our freed hours with admin, more client servicing or more meetings, and more billable work on undifferentiated services rather than building anything scalable. So that’s what I think is happening, is all of the work, all of the AI that… All the work that AI is doing is being absorbed into existing services, into existing fees, and we’re over-servicing rather than building new product lines or new service lines.

Chip Griffin: Yeah, and there are so many opportunities for agencies to truly be innovative and to find these new things that it seems to me that, that any agency owner should be thinking about that and not so much just, you know, “How can we incrementally improve productivity? How can we make sure that we’re claiming we’re ahead of the rest of the pack?”

How can you actually make a difference for your business for the long term? Because there is, there is huge runway to be had here, and now is the time to be experimenting when costs are much more reasonable than they are likely to be in the not-too-distant future. I can’t put a particular timeline on it- Yep

but it is, is blatantly obvious that the cost of all of these tools is going to go up.

Gini Dietrich: Yep …

Chip Griffin: as it has with everything else. I mean, I remember the early days of the land grab of Google Ads, and I built an entire business on the back of really cheap Google ads in the early days. And those same ads that I got for pennies back twenty-five now are twenty dollars or more per click for the exact same search terms.

And so the, these costs are going to increase. Now is the time to experiment and figure out what works and what doesn’t when the cost of failure is much lower.

Gini Dietrich: Yeah, I mean, I think you’re right. Like, the cost of failure is lower. The risk to failure is lower. Like, it’s… And it’s actually fun. You know, I did an, a webinar for IABC last week, and I showed them the PESO Model diagnostic that we just launched, and people were like, “How did you do this?”

And I’m like, “I vibe coded it.” Like, I did it. Right. I was like, “Here’s what I want. Here’s what I want it to do,” and it took two or three iterations for me to get it exactly right, and there will be a version two because now that I’m seeing people take it, I’m like, “Oh, okay, we should change that question or move this around.”

Like, right? But I launched a version one out there just to see, and we’re getting data from it. I get all of the data, which is fantastic. I can see where people sit in the PESO Model maturity ladder. You don’t have to have a copyright like I have with the PESO Model. You can absolutely do… Like, we just vibe coded an ROI calculator for our lead nurturing program for, you know, prospects.

Here’s an ROI calculator. Here’s the four things that we hear prospects say they have challenges with. Here’s how much we think it… Like, and you can move the numbers around, and you can toggle things. We vibe coded that. Right. We didn’t have to hire a developer for it. We did it internally, and it was super fun to work on as a team.

So there’s so many things that you can do.

Chip Griffin: That really there’s no shortage, and there are plenty of people out there who are sharing different ideas- Yes … and so the inspiration that you can take-

Gini Dietrich: Yes. Yes …

Chip Griffin: from others is immense.

Gini Dietrich: Yes.

Chip Griffin: But I, but I do worry that, you know, that this survey sort of reinforces what you and I have talked about which is that, that there’s not enough awareness and incentive apparently amongst agency owners to be pursuing these paths, and it does seem to be much more of a complacent attitude towards the use of AI in their businesses.

I will say, it, I mean, at least it is… I was encouraged by the fact that agencies do not seem to be seeing clients calling up and saying, “Hey, we wanna cut your fee.” So that’s- Yep. Yeah, that’s good. Yep … that’s, that’s been a widespread fear- Yep … but it was- Yep … the, the data was quite clear that that is not something that is happening at least at the moment.

We obviously don’t know whether clients are just deciding to do things on their own internally, and so, you know, maybe agencies are losing renewals or pitches to internal use of AI. Didn’t ask that question in particular. Maybe for a follow-up on somewhere down the road, that would be a good follow-up question.

Mm-hmm, mm-hmm. But honestly, I was a little surprised that, that there didn’t seem to be any direct pricing pressure, at least from AI from clients.

Gini Dietrich: Yeah, and I will, I mean, focus group of one, I will agree with that. One of the things that we are seeing is not pricing pressure, but we work with big companies, and going through procurement, which is always fun, the questions that we’re getting are, “How are you using AI? What environments do you use? How are you protecting our data? You know, how will you use this specific data?” So they, they ask those really specific questions, and we have to outline exactly what we’re going to do, and we can’t stray from that. So if something comes along six months from now that will improve it or make it better, we have to go back and revise sort of the AI policy that we’ve created with them with procurement.

But that’s what we’re seeing so that it’s less about you should charge us less and more about we wanna know exactly what you’re doing with our information so that we can protect it, and we can firewall it and do all of the things that we need to do to make sure that it stays safe.

Chip Griffin: Yeah, and the largest enterprise clients are always more worried about that stuff than anybody else.

Of course. And so if- Of course … you know, as, as we’ve talked about before, if that’s a market you’re gonna play in, then you need to understand the impact not just on AI but other things. You need to price accordingly for that headache. And more importantly to your point about, you know, making sure that you don’t make a change six months from now that, that it violates the agreement, that, you know, it’s, it’s important that you have the infrastructure in place to manage those kinds of accounts.

Which is, you know, these are all just more reasons why I would encourage most smaller agencies to steer clear of these because while they, they sound like great opportunities- … they come with a whole lot of extra headaches- Oh, yes … that you’re probably not-

Gini Dietrich: Yes …

Chip Griffin: thinking about. And if you’ve never had to experience it directly yourself, you have a, a real good chance of stepping in something somewhere along the way because you, you didn’t set up and you didn’t make sure that everything you do gets vetted by somebody who is familiar with the contract terms.

Yeah. Which in a small agency is probably you, the owner, and do you- Yeah … really wanna be- Yep … filtering all of that kind of stuff?

Gini Dietrich: Yeah. Yeah.

Chip Griffin: Go ahead.

Gini Dietrich: Oh, I was just gonna say, there’s also the, which we started to talk about, but 99, 98% are using AI in client work, 13% put it in contracts, 15% charge for it, 61% have no plans to charge, and you mentioned that 88% haven’t had a client ask for a discount.

Chip Griffin: Yeah, I mean, I guess this is an area where I had less concern, honestly, because, I think that I, I’m not sure I would agree that agencies should be charging for AI explicitly. I think it should be creating new value that you can charge for.

Gini Dietrich: Yes. Yes.

Chip Griffin: But I, you know, one of the reasons why I put that question in there was because I was actually a little concerned that agencies might be explicitly trying to charge-

Gini Dietrich: Interesting

Chip Griffin: for some of these AI tools, and I, and I think that you shouldn’t because to me that’s like, you know, charging specifically for a freelancer or something like that. You, you need to be in a position where you’re focused on what are you producing in terms of deliverables, results, et cetera, for the client, and not the mechanics of how you get there.

Because if you get into the, the space where you’re charging for the tools or for the use of AI, it takes away some of your flexibility in the future-

Gini Dietrich: Mm-hmm …

Chip Griffin: to either earn a greater profit or shift how you’re just doing things operationally or any of those kinds of things. So I’m actually not a fan of calling it out specifically, but it should create additional value for you- Yeah

that you can charge for that.

Gini Dietrich: Yes.

Chip Griffin: I, I don’t- my guess is that people looked at it as a more direct are you charging for AI itself, and- Yeah … and so I was actually happy that there wasn’t a lot of that.

Gini Dietrich: Yeah, I would agree with that. You know, I think if you think about using AI to create new service lines, to create new opportunities- And really, I’m, I’m sure that every single person listening to this has a list of things they’ve always wanted to do.

Our ROI calculator’s a great example of that. The PESO model diagnostic is another one. Like, I have probably four pages in my notebook of things that I would love to try at some point. This makes it accessible. You can do it yourself. You don’t have to wait until you can hire a developer.

You don’t have to wait if you wanna build an app. You don’t have to wait until you can afford to hire an app developer. You can actually do this on your own. Will it be perfect? Will it be, you know, as great as, as if you hired a developer? No. But taking it out there as a beta test or a version one, absolutely you can do that, and test it out and see if it works, see if your idea has legs and has merit.

And then use that to generate some income that then eventually you would hire a professional to help you repackage it and make it beautiful.

Chip Griffin: Yeah, because I mean, you know, a lot of people are vibe coding apps and that kind of thing, and, and it is, it’s great that it gets you there, and it’s great that it, it’s causing you to expand your horizons.

I think people do need to keep in mind that maintaining these applications over time- Yeah … requires a little bit more effort than- Yeah … than I think some people realize. Yeah … I’ve seen plenty of people vibe code these apps and be like, “Oh, cool. We’re all done.” Well, yeah, but if you’re gonna have a lot of users on it over time, there are gonna be hiccups.

People are gonna do things that, that you don’t imagine. So if it’s something simple-

Gini Dietrich: And I saw on Reddit yesterday that somebody had vibe coded an app and, and took it to, like, 40 people to beta test it, and it worked so well that it was costing him a significant amount of money- Yeah … to keep it going and he was like, “I don’t know what to do.”

So there are those pieces of it, too, but I think just experimenting with some of your ideas, AI can help you do that for sure.

Chip Griffin: Yeah, and if you can get to the proof of concept stage, that at least opens the door- Yeah … for you to, to begin to think through a rational business model for it. But you know, you, if you don’t even experiment, then you’re never gonna have that opportunity.

And that brings us to the last point that I wanted to raise from the survey, which is this, the disconnect between how owners perceive their own capabilities with AI and their team’s capabilities- Mm-hmm … with AI.

Gini Dietrich: Mm-hmm, mm-hmm.

Chip Griffin: And owners, their optimism, extends very much to themselves, and they see them as at the – themselves as at the leading edge of AI, with their teams lagging behind.

Not incompetent or inept or anything like that, but it was, I think it was 84% of owners rated themselves as moderately or very knowledgeable about AI, and 61% of their team as the same. So obviously a meaningful difference between those two. I think that, that 84% is extraordinarily generous scoring for the owners in terms of their knowledge of AI because I have conversations with a lot of owners.

I would describe very, very few as very knowledgeable- And a small percentage as moderately knowledgeable. I think slightly knowledgeable is where I would put more-

Gini Dietrich: Yes, I would agree with that …

Chip Griffin: at least if we’re not grading on a curve. If we’re, if we’re grading on, you know, comparison to other similar professionals, I, I just don’t see small agencies as a place where AI today, at least, is thriving.

Gini Dietrich: Yeah. I totally agree with that, and like you, I mean, I’m not so much in the coaching business anymore, but I have lots and lots and lots of friends who run agencies, and same thing. Like, it’s… I would say it’s slightly knowledgeable.

Chip Griffin: Yeah. And, but I do agree that probably many of their teams lag behind them because the teams don’t have the time.

The owner isn’t making the investment in them in terms of time- Yep … or products or services.

Gini Dietrich: Yep.

Chip Griffin: And so if you want to see that change in your agency, you know, you do need to drive that. You do need to encourage your team to be using more of these things. I mean, I… One of the numbers that did concern me was, I think half of the owners said that one of their biggest concerns with AI was their team’s over-reliance on AI.

I am not seeing any evidence anywhere of over-reliance on AI by any agency employee.

Gini Dietrich: Oh, I do.

Chip Griffin: Over-reliance?

Gini Dietrich: Mm-hmm.

Chip Griffin: Okay.

Gini Dietrich: Yeah.

Chip Griffin: Do tell.

Gini Dietrich: Mm-hmm. My own team. Sometimes I’m like, you guys-

Chip Griffin: And I suppose part of this is how you define over-reliance.

Gini Dietrich: Let’s not use AI for everything. You gotta actually use your brain.

Chip Griffin: Fair enough. Mm-hmm. I guess, yeah, I, I guess to me, in the use cases that I see, with most agencies, it’s not relying on the AI enough and less so over-reliance, but I’m sure there are cases.

Gini Dietrich: It is over-reliance in my organization for sure.

Chip Griffin: Okay. That is good to know. So in any case, lots of room for agencies to continue to improve on AI, but happy that, that there is this optimism.

I, I much prefer this to… I, you know, I when I put this survey out, I wasn’t sure if it was gonna be just all fear and doom and gloom and oh my God, you know- Yeah, sure … what is AI gonna do to my business? Yeah. ‘Cause you hear a lot of that- Mm-hmm … you know, when you’re talking with- Mm-hmm … agency owners. But for the most part, it doesn’t seem to be the case.

It, it does… I think there are certainly pockets of over-optimism to a degree that, that needs to be addressed, and there needs to be more experimentation, more innovation, more investment and all of those things if agencies are really going to thrive with AI in the future.

Gini Dietrich: Yeah. I totally agree.

Chip Griffin: So with that, that will wrap up this episode of the Agency Leadership Podcast.

I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.