OpenAI on what every CMO needs to know about AI with BCG

14:45Elke Karskens:But talking about websites, building a website has never been easier. I'm not sure if you're familiar with Codex, like perhaps for our listeners, worth like a really quick voiceover. But Codex is our agent tool, which was initially developed for developers. We launched it on desktop back in February. And today we have over 5 million weekly active users using Codex. But what the really interesting trend is, or trend is perhaps not entirely, well, observation that we're seeing is that Codex is being used by people who don't have a technical background. So as a marketer, I truly can't write a line of code for the life of me, but I am able with Codex to develop a website from scratch.

15:26Mark Abraham:Yeah, our BCG consultants are using it too. We're past like writing slides now. now we're building microsites and websites for our client presentation so it's truly changing

15:35Elke Karskens:the game for us we even build websites that are for internal use only so for my team like when we're trying to track certain things build a really quick site can see exactly what's happening where and when we flash it up during team meetings so yeah i like your point on presentations as well

15:51Mark Abraham:so this time last year at can i sat next to colin fleming who's just joined you as one of your cmos and he just showed me his chat and said, because we were both at Adobe Summit a few weeks ago, but he was presenting on the kind of main stage and he said, oh, you know that presentation I gave? I said, yeah, yeah, yeah, it was brilliant. He said, you know 70 % of it was written by chat and I'm like, no, really? And then he showed me and he'd downloaded like episodes of the podcast, he'd downloaded articles, he'd downloaded research and basically trained it and then he put a prompt in saying, I'm going to do a presentation, this is the audience, this is the message i want to get across these are the sources i want to quote build me a presentation and he said it's about 70 right yeah amazing amazing yeah that is a lot of prep time

16:34Elke Karskens:and effort like shortcut it is it is yeah and colony yeah he joined two weeks ago we're so excited to have him but you're right like presentation would normally be something you'd block an hour out for in your calendar to make literally within minutes prompted boom

16:47Mark Abraham:we have the output yeah for me it's like my chief of staff this con is the first one i use chat GPT to prep for and just like putting in all the notes, putting in all the context from our teams, putting in my articles and boom, like I think I can do double the number of entries and the like this week.

17:06Elke Karskens:Talking about chief of staffs, I actually made my own chief of staff. I also, by the way, gotten in a habit where I use voice a lot. So now in the office, I walk around with a tiny microphone so that I can chat to Kodak's the entire time. And I made a chief of staff, I guess, similar to yours. But it goes through all of my slacks and emails every three hours, then sends me an update, the things I have to respond to, what's worth knowing. It drafts all of my emails. And the only thing I have to do is like go back in and basically press send. So it's been a true game changer. That's amazing.

17:37Mark Abraham:I'm taking notes after this. I'll send you the prompts. I need this. That would be revolutionary. That's amazing. Mark, I was keen to find out a bit more about your CMO surveys. You've interviewed 300 CMOs. What's changed in the last year when it comes to AI? Because I think you said this a bit earlier, but in all the conversations I have, there's a feeling that AI is being done to CMOs. And it's like, got to save some money and where's the efficiency and can we cut down on time to market, that kind of thing. But that's shifting a bit in terms of who owns kind of the impact of AI and growth, isn't it?

18:11Mark Abraham:And that was the most striking thing this year in the CMO survey. So over half of CMOs for the first time ever told us that they're in the driver's seat on the AI investments and the decisions about those in the marketing function. And this is unique because CEOs, actually, they're in charge of 70 % or so of them tell us that they're driving the decisions across the enterprise and in most other functions. Tech and marketing are the only exceptions to that. So CMOs are now getting to make these decisions now with great power comes great responsibility. So you're also seeing expectations going way up on delivering ROI from these investments.

18:55Mark Abraham:And that's where CMOs are also telling us they've got some work to do on the actual transformation itself. The other big learning from the survey was this whole dichotomy between the illusion of transformation. Almost every CMO told us they are seeing AI transform critical parts of the marketing function. But when you dig into it, it's really a broad, not deep transformation. Only about a third of the CMOs have really done the hard work of wiring the organization, upskilling their teams, actually putting in place that new agent tech stack that's required to deliver on that transformation. That's very interesting.

19:36Mark Abraham:How do you do that? Because I see exactly what you say. People in marketing are taking bits of the task and automating it. How do you start with AI and work back to deliver that kind of transformation? So last year, you already saw specific workflows getting piloted and then scaled. Content is the obvious one where CMOs have been piloting AI for a long time. I think what's new now is being able to connect those workflows. So insights agents that sit on top of your data and provide insights for the marketers, democratizing those insights where you have to go to the data analyst to get those insights.

20:14Mark Abraham:Or creating creative briefs with ChatGPT and tools like that, or actually using your tools to generate content. And then on the measurement side as well, automating a lot of those reports that took days and weeks to deliver. When you connect those workflows, you see about 8 % of CMOs saying they're actually running autonomous campaigns end-to-end for certain types of creative and content and certain types of channels. but then you also see still the human part of the workflow is critical when it comes to checking the quality as well as setting the brand standards up front. And what does it mean for like the skill set of the future CMO?

21:00Mark Abraham:Like what skills are going to be in demand to deliver that kind of change? I think collaboration is even more critical. So the role of the CMO has completely changed. That partnership between the CIO and the CMO has never been more important. A lot of the critical decisions on big IT investments are made by the CIO these days, but the strategy, the requirements, even the foresight on what tools are necessary has to come from the CMO. And that's where smart CMOs are setting up strong. MarTech functions and side their organization. One CMO told us she's established a group of AI wizards. So these AI wizards are looking at the latest tools and for example, including Codex, but a bunch of off-the-shelf startup tools to really figure out what's the next tools that their companies need to onboard and really scale and go through the security checks.

22:01Mark Abraham:And by doing that, they've now got a set of train-the-trainers who can then adopt the tools, be early advocates, and really jumpstart the transformation. Because in one sense, it's a human transformation, isn't it? It really is. In a way. It is. It is. It is.

22:16Elke Karskens:And it's hard, especially for certain functions within the market, there's nowhere to get started, but I agree with everything that you said. It's like, I think every CMO or senior marketing leader should really think of themselves as the architect of intelligence. and very early on bringing on board the expertise an AI ninja somebody that can sit across the different functions within the organization really look at the workflows where where do the problem sits and help figure out how AI can help improve things is a really helpful start yeah and and that

22:48Mark Abraham:talent doesn't exist out there so you really have to upskill your own team to get there I think That's what CMOs are telling us too, is how you upskill folks in bite-sized chunks every week. It's not just sending them to a big training and then suddenly they're upskilled. It's doing the hard work every week. And then also rethinking the roles is another big chunk of the work. You may not see functional specialists that only focus on one channel, like email versus paid versus website anymore. you can see a lot more cross-channel orchestration because the tools are there to do the last mile execution.

23:30Mark Abraham:Now, you see a lot, Mark, don't you? Because you cover a lot of sectors, a lot of different customers. Who's doing this really well? Who should we be looking at? Well, I love looking at the beauty space for inspiration. You see some great marketers there. And also, just because of how much has been transformed with influencers, with digital marketing itself, content has been really critical in that space. So you're seeing some of the largest beauty companies, but also emerging brands really employ agentic workflows, not just in the content creation, but in insights and an activation and connecting the three.

24:09Mark Abraham:The other pieces in media and entertainment, those companies are the ones trialing autonomous campaigns, but also So really using the insights detection piece when you bring together a great agent with your proprietary data, third-party data, and the what I call brand intelligence layer, which is everything the brand needs to think through in terms of guardrails, how their best marketers do these workflows, and really tap into detecting trends at the speed of culture. So when you're a music company, you can understand which audience and which artist is trending right now and tap into that real quick with the right campaign.

24:54Mark Abraham:Now, a couple of years ago, you know, Cam was all about the potential for AI. A year ago, we're talking about agentic, you know, now in sort of agentic commerce, like you're saying, autonomous, you know, connecting all things together. Maybe a question to both of you, just to kind of speculate a bit. What are we going to be able to do in a year's time that we can't do today?

25:12Elke Karskens:Yeah, that's a good question. Now, I think you're right. There often is a perception that AI is still a technology platform, but it's become an operating layer and we're already at the next frontier. Like when you look at our models, like JetGPT 5.5 is our smartest and most intuitive model yet. It is absolutely incredible. Codex, I talked about that a little bit already, like fundamentally helps audiences, including non-technical ones, to do work in a different way. And then ads helps reach people.

25:41Mark Abraham:So two predictions. Oh, all right. We're on. We're on. Come on then. Okay, so two predictions. We are recording this. Number one, so I lead our marketing, sales, and pricing practice at BCG. And across these functions, we've always had some tension. You know, marketing generates the leads, but can sales convert them? And is pricing at fault for not being able to convert them? I think you're going to see these silos start to break down. because with agentic workflows, the handoffs become much cleaner and easier, and more of the work can be spent on the strategic layer. So that's number one. I think the other piece is the big brands have to close this gap between illusion and reality in terms of their agentic transformation.

26:30Mark Abraham:Otherwise, they will see these agentic native startup brands start to take share. We're already seeing this in spaces like beauty or apparel where small brands are gaining share very quickly because they're using the latest tools, not just on content creation, but how they deploy to channel, optimize their campaigns, then tap into new trends. And we're just barely scratching the surface. It's a really good point. It's never been probably a better time to be a startup now because you don't have all the legacy infrastructure and technology that's holding you back or the ways of working. You suddenly got able, like you said earlier, just a small thing about building websites can be done immediately.

27:10Mark Abraham:You don't need to be technical. So it's a huge opportunity, isn't it, for smaller challenger brands to kind of compete with the large ones.

27:15Elke Karskens:It's true. And I think that the smaller rising companies right now, like they are already seeing AI as a fundamental operating layer where there is sometimes still perception with slightly more traditional organization that it's just a technology platform that they have to figure out. But we're already at the next frontier. When you look at our models, like our latest model, ChatGPT 5.5, it is the most intuitive and smartest model yet. Codex allows everyone, technical, non-technical, to do work in a different way. AI is doing the actual work. Ads allows brands to really reach people in a different way.

27:51Elke Karskens:So perhaps my prediction is more that I think all brands, regardless of where they sit, how long they've been around, that they have to be a lot more intentional moving forward and meeting people where they already are.

28:02Mark Abraham:Yeah. And I think because a lot of, you referenced this in your report from Illusion to Reality, a lot of it has been potential and talking about what's possible, but now we're seeing actual results and brands achieving great things. And that'll be the exciting change next year, won't it, to see the reality? Yeah, that's what I'm excited about is finally we can move from just productivity gains to really pursuing growth with all these amazing tools. And you're seeing it in our survey, 30 % of B2C CMOs and 20 % of B2B CMOs said they have realized real measurable gains on the growth front from using tools like ChatGPT.

28:41Elke Karskens:Yeah, but I'm also really excited next year to hear the stories from the creative community and how they have been using AI to develop the next campaign and big bodies of work. At OpenAI, we do a lot of design sprints. And it is absolutely incredible to see how fast we can move from idea to concept, as I'd mentioned earlier, to see some of the work that we're supposed to present to leadership, to see that instantly come to life, to really play around with the settings in which the potential work shows up, the people in the work, the talent itself. and so I think that next year hopefully we're going to see some very interesting things coming from the creative community as well in terms of how they've been using AI.

29:24Mark Abraham:Yeah I just love that speed point of before we would spend when we were working with clients together with you like so much time on creating the actual output versus now it's a lot of the time is spent on iteration and getting input and making the work better because you can actually show them what it looks like.

29:45Elke Karskens:Yeah.

29:45Mark Abraham:So we've come such a long way. So we're sitting here together. I know you guys have got this kind of great partnership working together. What's the power behind you two collaborating? What does it allow you to do?

29:57Elke Karskens:Yeah. Well, I mean, we are incredibly grateful to partners like BCG to be able to help scale the work because from the seat of a marketing leader, it isn't always that easy to know where to start, but it really is thanks to partners like you who have been truly phenomenal that we can really scale the magic and power of what this technology brings to so many more organizations.

30:18Mark Abraham:Yeah, and I'm especially proud that we've been able to do it pretty much in every corner of the world, from Asia to Europe to the U.S. And I think attack both sides of the issue. On the tech front, our BCGX, four deployed engineers work seamless with yours to actually get the technology humming. but then so much of the heavy lifting 70 as we like to say of the puzzle is about that human element and driving the change upskilling people training people uh figuring out who those ai wizards are going to be that are going to lead uh the charge and then really scale to the rest of the organization so mark given how much you see and how many different industries like if you had to pick one thing that you think people haven't properly understood yet what would be the thing people haven't understood i think it's that deploying agents just on top of your data is not good enough in this age of ai companies will compete not just on their data but also how their best marketers do the work and that's what you need to codify in this brand intelligence layer as i like to call it and that is hard work actually you have to define the guardrails what kpis matter how you do the work what quality checks should be applied that's where companies really need to invest the time to get it right yeah that makes it sound so good because your data is your moat isn't it in terms of the information you have on your customers and all that kind of thing but then it's how you use it exactly the value you can extract from that yeah it's like you're competing on your best talent and being able to codify it into this new agentic tech stack paired with your data yeah so it's a new age it's only just begun yes yes we're just scratching we do forget that don't we because it's a bit like the a when the internet was created

32:07Elke Karskens:exactly that's why i was talking about my socks i swear to god maybe that says more about me than about like but it is absolutely incredible seriously people talk about chat gpt like it's been around forever people forget like sometimes the answer isn't perfect i'm like do you understand what sits behind that it is it's wild yeah i got my surfboard out this weekend for the first time

32:30Mark Abraham:it's six years old there we go double the age of chat gpt uh i got i got two teenage daughters are going through education i've just i've just watched how suddenly chat gpt is now being used in class uh for research but also how they have to audit to make sure that you put some original thought in yeah because obviously it's a combination of both original thought and the research together but even that's moved you know you'd see as kids of certain age whether or not they've kind of you know educated with the benefit of and that's why like we keep on building

33:01Elke Karskens:products that people truly love and like one of my absolute favorite ones my kids are a little bit younger still but not that young is study mode um i think because i work at open and yeah they're of course very exposed to like gpt specifically but study modes allows them to learn in a different way so i upload a curriculum or a particular assignment and it just asks questions to help

33:21Mark Abraham:expand their thinking which is fantastic yeah i think you're gonna find entirely new jobs get created here and that's the piece that's not in the conversation um so our latest ai study we looked at 1500 job families and only about 15 of them in our judgment will go away the rest will actually expand or even get created as new jobs. So actually, we're not even yet appreciating how much of the economy there is to unlock through AI. And for example, in our sales practice, you're seeing young, fresh out of college kids that are agent native, get paired with established, well-respected salespeople and just completely transform their workflows and triple, quadruple their productivity.

34:13Mark Abraham:So yeah, yeah, lots of great stories. I mean, stats I looked at the other day, actually, just just to put this in perspective, the amount of investment in AI blew my mind, right? So I look back at big, big investments in humanity, like humanity changing level, Manhattan Projects, obviously huge, right? 36 billion, the Apollo space program, 298 billion to get us on the moon, right? AI so far, 2.5 trillion has already been invested. It just shows the scale of potential, doesn't it? Yeah. That sits in front of us.

34:42Elke Karskens:Yeah, it really does.

34:44Mark Abraham:Yeah. And we are seeing that in our CMO survey as well. This year, the average CMO said they're spending upwards of$15 million on AI tools. That's on top of everything they're spending on their MarTech stack and core systems. And they're in charge of those investments now. So they're in the driver's seat. Well, that's good news, actually. Exactly. CMOs finally get some control back. Exactly. They just have to deliver. Yeah, expectations are just about through the roof. Yeah, be careful what you wish for. So one of the things I'm seeing in a lot of conversations is how up to now, particularly the focus has been on efficiency and cost saving rather than effectiveness.

35:21Mark Abraham:I love particularly what you said earlier about the judgment and the craft and all these things, because there's a danger, isn't there, sometimes with AI, that it makes us lazy. That what we do is we outsource thinking, we outsource creative ideas, rather than focusing on actually where the value gets added. So I was just thinking from your perspective, how do you see that element, the effectiveness being improved through AI rather than just the efficiency?

35:45Elke Karskens:Yeah, the efficiency is something that's easy to measure. So very understandably, like that's where we started. But if that's where we would end, so much of the opportunity would be lost. So from a CMO's perspective, this is the moment to really help figure out how AI can evolve particular workflows and start with one, build on top of it. How from a creative development perspective, you're approaching production in an entirely different way that might feel a little bit uncomfortable in the beginning. But once you get going, you'll be astonished by how much it is that you can indeed evolve.

36:23Mark Abraham:I think that's so true. And I would build that a lot of CMOs are under cost pressure still, but leading CMOs are taking that as an opportunity. So when they're faced with a restructuring or a cost out target, they're not just going in and taking out 10, 15 % of their function. They're actually saying, let me create some investment pool back. Let me invest that into tools and new workflows and new technology and new types of roles and upskilling my own team and maybe make harder, bigger changes, but really build for the future rather than just take another 10 % out. By the way, I loved your reinvestment quote.

37:07Mark Abraham:There you go. That's a great pitch for a CMO, by the way, to say, of everything I save, what percentage can I reinvest in growth? Because that's the win-win. I think we've forgotten that equation. We've gone all in on the how much can I save rather than how much does that liberate to grow the top line of my business? Yeah, I mean, one CEO we worked with said across all the functions, over half will be reinvested and the marketing function actually led the way in the change.

37:35Elke Karskens:Yeah. And the true marketing style, it's about flipping on its heads. It isn't just about the efficiency flip, like look at it from the other perspective. Imagine the growth that you can generate when things are more efficient as well.

37:47Mark Abraham:Exactly. CMOs are leading the way. They are leading the way. It's good to have such an optimistic view of this, I think, which is really exciting. It's well needed, this conversation. It is.

37:56Elke Karskens:I honestly can't think of a more exciting moment in time to be in marketing and advertising than right now. And this place right here. And this place here in Cannes especially. Like, it is absolutely amazing.

38:08Mark Abraham:Now, maybe to round off, you two are both working in very influential positions at the forefront of technology, seeing great changes happening in front of you. What would be the one best bit of advice that you've both been given from a career point of view that our listeners could benefit from? I would say when I was elected partner at BCG, someone twice told me, you know, invest in the people on your teams. That is the single most important. And we actually have the data to show this across thousands of partners. long-term measure of success. And it's definitely been true. I've had some incredible people that I've had a chance to work with over the last decade who've gone on to have stellar careers inside and outside of VCG themselves.

38:57Mark Abraham:That's interesting. I've just done my first ever uncensored CMO survey of CMOs I've interviewed early this year. And one of the questions was, what's the single biggest challenge you face? It wasn't strategy. It wasn't investment. It wasn't tactics, it wasn't technology. The top two by a country mile were leadership and people.

39:15Elke Karskens:Yeah, I would agree with that. Yeah. The best advice I think I've been given by my previous boss, Kate Rau, who was a CMO here at OpenAI, who unfortunately, due to some personal health issues, stepped away from the role. But I've had the fortune of working with her at Coinbase before this as well. And we had a bit of an overlap at Facebook as well. And what Kate's always told me, she's like, it is all about operating with your hands wide open and creating a safe space for experimentation because things move so incredibly fast and if our teams feel any sense of fear for failure when they're trying to adopt new technology or do things in a different way you're never going to see any of the output so really creating a safe space where people are are willing and open to experiment is i think incredibly important it goes back to your first

40:04Mark Abraham:question on the CMO as well I think curious CMOs are gonna win the future yeah it is so true and you're fighting against the corporate desire to risk mitigate all the time isn't it because in most corporate organizations it's how do I take the risk out how do I make sure I don't look for silly how do I avoid making the big mistakes that get me fired but on something like AI where we're making generational leaps into the unknown often aren't we you can't afford just to sit back and wait to see how it plays out you gotta jump haven't you yeah true i think when your teams feel that you trust them magic can happen yeah that's amazing advice thank you both i very value both those advice that's really really good thank you thank you well thank

40:47Elke Karskens:you for having us yes what a great start yeah you're joining me thank you yeah no thank you

40:52Mark Abraham:so i hope you enjoyed that episode of uncensored cmo as much as i enjoyed making it now by the way I've got a new newsletter. So if you'd like to get my thoughts on the one thing that I take out from each episode every week, then do subscribe to the One Thing newsletter. I'd really appreciate it. Also, I have another podcast. Just launched Uncensored Renegades with the fabulous Cori Marchesotto. She is one of the world's best CMOs. She's an absolute rock star. Every week we pick one topic, spend 20 minutes trying to fix it. So check out that. It's in your feed, Uncensored renegades and finally i want to give a huge thank you to my sponsor system one they generously provide so much support for this podcast it would not happen without them so big thanks and lots of love to system one i'll see you next time