📺️ Television ads are dying...

PLUS: AI is the star of India’s 1 billion person election; Elon Musk is moving at the speed of light with xAI

Today’s market performance 🏆️ 

S&P 500: -0.27% 📉
Nasdaq: -0.18% 📉
Dow 30: -0.51% 📉
Russell 2000: -0.79% 📉

TOP STORY
📺️ A new era of advertising is upon us

📸 Getty Images

Besides the money being spent on obnoxious political campaigns and re-runs from the Super Bowl, companies are starting to tighten their purse strings when it comes to TV ads.

  • Mondelez, the maker of Ritz crackers and Sour Patch Kids, is spending just 15% of its U.S. ad budget on TV this year, down from 42% three years ago.

  • It's the same story with Hershey: their TV ad spending has dropped from 80% to 30% over the past five years.

💬 Another 9% of Mondelez’s budget is going to streaming, with over three-quarters of the ad spend directed elsewhere.

💬 Brands as a whole are expected to spend $60 billion on traditional and digital TV advertising in total, which is down from $64 billion five years earlier.

Brands are realizing that more and more people are stepping away from their TVs in exchange for their tablets and smartphones. 

But while streaming giants like Netflix and Disney Plus are cost-effective for viewers, they don’t provide a great alternative to TV advertisers.

  • 🫰 Buying an ad on a platform is very expensive. The ad can only be 15-30 seconds long, and perhaps most importantly, it only reaches the people who actually pay for the ad tier (which is much fewer people than you’d think).
     

  • For example, In Q1, only 7.5 million Netflix subscribers—or 10% of the company's U.S. customer base—paid for the ad-supported version of the platform.

But don’t fear big brands; there are a couple of options:

  • 📱 Social Media: Platforms like YouTube, Instagram, and TikTok are great options because their billions of users directly engage with ads and content, making them very attractive for brands with IRL products.

  • 🛒 Retail media: Retail media, put simply, is when giants like Amazon and Walmart allow brands to place precise ads on their websites.

    • This is extremely effective because retailers have data on hundreds of millions of customers, which big brands can use to create targeted ads tailored to entice specific customers.

Next time you see "exactly what you were looking for," just remember it is no coincidence.

It's a high-key cheat code that virtually every brand can exploit. Talk about making the rich richer.

POLITICS
🇮🇳 AI is the star of India’s 1 billion-person election

📸 New Scientist

While we’re stressing about our own presidential election coming up, across the pond in India, nearly 1 billion people are expected to vote when this year’s nearly two-month election is over.

Interestingly enough, the star of many campaigns? Artificial intelligence.

💬 More than 50 million AI-generated voice clone calls were made in the two months leading up to the election.

And while the videos are unique, more importantly, they’re practical.

  • Deepfakes can help politicians navigate India’s 22 official languages, not to mention the thousands of regional dialects that would otherwise take millions of hours (my own estimate).

  • And maybe some people like getting a personalized call; it makes them feel special. I would personally think it’s just another scam call, but maybe that’s just me.

Now, Donald [Trump] and [Joe Biden], before you jump on this new tech, you should know something…

Many people are concerned about the lack of consent and disclosure when voters get AI-generated messages without knowing they are fake.

That being said, AI-driven political campaigns are inevitable. Whether they start this election or next, politicians will soon have an unlimited toolbox at their disposal full of ways to trick us.

ARTIFICIAL INTELLIGENCE
💨 Elon Musk is moving at the speed of light with xAI

xAI was founded by Elon Musk in March 2023 with a noble mission: to push the boundaries of what AI can achieve in understanding and interacting with the world.

Musk wants to create AI that anyone can use but, most importantly, do so safely, which he believes OpenAI is not currently doing.

💬 Elon Musk originally co-founded OpenAI with Sam Altman and others in 2015.

💬 One of the main reasons he sued OpenAI a couple of months ago was because he didn’t think they were being safe and were straying from the company’s original mission.

xAI was his new ticket into the AI game… 

  • Grok, the witty chatbot available to all premium X users on the platform, is the biggest weapon arming his new venture.

  • We’re starting to think that Grok is the underlying reason Musk bought Twitter in the first place.

We know what you’re thinking: $44B is a pretty expensive price to pay for just one piece of the puzzle, but for Grok, it’s everything.   

Grok, unlike other chatbots like ChatGPT, has access to real-time knowledge because it’s trained on X posts and continually gathers more data whenever people post.

You’re quite literally feeding the beast by posting on X.

Now, xAI is working on allowing users to input images into Grok and get text-based answers, similar to GPT. This would be a game-changer for a chatbot that’s only been around since November.

Look, even Musk could agree that Grok is still a bit behind GPT at this moment.

But with real-world knowledge and multimodal functionality, Grok 1.5V could really close the already tightening gap with GPT-4, and we’re here for it.

Let the battle of the AI models commence!