The AI Ad Race Has Begun. Local Markets Still Have an Edge

(5 minute read)

Artificial intelligence has moved from the conference stage to the income statement.

Ad agency holding company, Publicis Groupe Chairman and Chief Executive Arthur Sadoun recently said AI continues to be a “tailwind” for the company, helping drive growth and widen its lead over competitors. The more striking number was not the word “tailwind.” It was the figure Publicis attached to its business: 86% of first-quarter 2026 net revenue was attributed to AI-powered capabilities.

That number should get the attention of every local media seller and ad agency executive.

For years, AI in advertising has been discussed as a coming disruption. Now the large agency holding companies are beginning to describe it as a central operating system. AI is being used to plan media, optimize bidding, personalize messages, automate reporting, generate creative variations, segment audiences and interpret data faster than traditional teams could manage manually.

The debate is no longer whether AI is coming to advertising. It is already here. The better question for local media and agencies is: What should we do with it?

The answer is not to panic. Nor is it to pretend that AI is simply another shiny object. For local-market advertising, AI represents both a threat and an opening.

The threat is obvious. If national agencies and platforms can use AI to automate buying, creative production and campaign optimization, some local sellers may find themselves pushed further down the value chain. The buyer may see them as inventory providers rather than strategic partners. The conversation may become more about price, impressions and dashboards than about market knowledge, customer behavior and sales results.

The opening is just as important. Local media companies and local agencies have something AI does not possess by itself: local judgment.

A machine can process data. It can identify patterns. It can produce dozens of ad variations. It can recommend an audience segment. But it does not know that one side of town thinks differently from another. It does not know which local car dealer has built trust over 30 years, which bank sponsors half the community events, which restaurant group is expanding, which hospital is fighting perception issues or which home-service advertiser has quietly lost share to a more aggressive competitor.

That is where local media and agencies can win.

The big advertising companies are using AI to increase efficiency. Local media should use AI to increase relevance.

For radio sellers, AI can help identify which advertiser categories are active, which audience segments matter and which sales stories are most compelling. But the real value comes when the rep connects those insights to a local business problem. A radio station should not merely say, “We reach adults 25-54.” It should say, “Here is where your best prospects are, here is what they care about, here is when they are likely to buy, and here is how our station can help you stay top-of-mind.”

For television and cable sellers, AI can improve campaign planning, proposal writing, competitive research and post-campaign reporting. But TV and cable still have a powerful advantage in sight, sound, motion and local credibility. The opportunity is to combine AI-enabled analytics with the emotional force of video. A local TV seller should be able to show not only who a campaign reached, but why that reach mattered.

Print has its own opening. Newspapers, city magazines and local publications can use AI to help advertisers understand neighborhoods, lifestyle segments, content interests and purchasing intent. But print’s larger role may be trust. In an environment filled with automated content and synthetic media, established local publications can position themselves as curated, credible environments for serious advertisers.

Outdoor companies should view AI as a planning and proof tool. Artificial intelligence can help analyze traffic patterns, trade areas, competitive locations and creative performance. But outdoor’s strength remains simplicity and public presence. The local billboard or transit campaign that makes a brand impossible to ignore becomes even more valuable in a fragmented media world.

Digital sellers face the most direct AI impact. Programmatic platforms, search, social and connected TV are already deeply automated. But that also creates an opening for local digital teams that can explain what is happening behind the dashboard. Many local advertisers are overwhelmed by digital complexity. They do not need more jargon. They need a trusted local advisor who can translate AI-driven performance into plain English.

That may be the central point for local ad agencies.

AI will not eliminate the need for agencies. It will raise the bar for what agencies must do. If an agency’s value is simply placing media, resizing creative or generating reports, AI will put pressure on that model. But if the agency’s value is strategy, judgment, creative direction, market interpretation and client leadership, AI can make the agency more powerful.

The same is true for media sellers.

The weakest salespeople will use AI to send more emails, create more generic proposals and produce more noise. The best salespeople will use AI to prepare better questions, find stronger category insights, tailor presentations, identify business opportunities and follow up with more useful information.

That is the difference between AI as automation and AI as intelligence.

Local media companies should begin by auditing their sales process. Where are reps spending time on low-value tasks? Proposal formatting, basic research, first-draft emails, competitive summaries and recap notes are all areas where AI can help. But the goal should not be to replace the salesperson. The goal should be to free the salesperson to spend more time thinking, advising and building trust.

Second, local media should build AI-enhanced category playbooks. Auto, banking, healthcare, home services, legal, retail, restaurants, furniture, real estate and entertainment all have different buying cycles and consumer triggers. A smart sales organization can use AI to help create sharper category stories, but those stories must be grounded in local data and local advertiser realities.

Third, agencies and media sellers should become more transparent with clients about AI. Many advertisers are curious. Many are nervous. Some have already been disappointed by automated campaigns that produced clicks but not customers. Local professionals can build trust by explaining where AI helps, where it falls short and where human oversight remains essential.

Fourth, local media should use AI to improve creative, not cheapen it. The temptation will be to produce more ads faster. But more creative is not necessarily better creative. AI can generate ideas, headlines, scripts and variations. Human professionals still need to decide what is believable, distinctive and emotionally persuasive.

Fifth, local sellers should connect AI to business outcomes. Too much digital advertising has trained clients to look at surface metrics: impressions, clicks, views and engagement rates. AI could make that problem worse by creating more dashboards and more data points. The local seller’s job is to bring the conversation back to sales, store traffic, leads, calls, reputation, market share and top-of-mind awareness.

The Publicis number is important because it suggests that AI is becoming embedded in the machinery of advertising. But there is another number worth noting. Some analysts define AI advertising much more narrowly, limiting it to campaigns where AI controls targeting, bidding, placement, budget allocation and optimization with minimal human involvement. Under that definition, AI represents a far smaller share of the market.

That difference matters. It shows that “AI-powered” can mean many things. It can mean a fully automated buying system. It can mean a planning tool. It can mean a creative assistant. It can mean a reporting engine. It can mean a data-analysis layer inside a much larger human-led process.

Local media and agencies should not get trapped in the terminology. They should focus on the practical question: Can AI help us serve advertisers better?

The answer should be yes.

But only if AI is paired with human judgment, local market knowledge and disciplined sales strategy.

The future local seller will not be the person who knows the most about avails. It will be the person who can walk into a client meeting with a sharper understanding of the advertiser’s category, customers, competitors and growth opportunities. AI can help prepare that seller. But it cannot replace the trust created when a knowledgeable local professional helps an advertiser make a better decision.

That is the lesson for radio, TV, cable, print, outdoor and digital.

Do not sell against AI. Sell with it.

Use it to become faster. Use it to become smarter. Use it to make your sales presentations more relevant. Use it to uncover better advertiser opportunities. Use it to give clients clearer evidence. Use it to reduce wasted time.

But do not let AI become the story.

The story is still the advertiser’s growth. The story is still the customer. The story is still the local market. The story is still whether the campaign produces results.

The largest advertising companies are now telling Wall Street that AI is central to their growth. Local media companies and agencies should hear the message clearly. AI is no longer a back-office experiment. It is becoming part of the competitive infrastructure of advertising.

The winners in local markets will not be the firms that merely use AI. They will be the firms that use AI to become more human where it matters most: in strategy, creativity, trust and local insight.

Source: MediaPost

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