- The AI Marketing Newsletter
- Posts
- AI's Hidden Costs Are Eating Your Budget
AI's Hidden Costs Are Eating Your Budget
The real bottleneck isn't production anymore—it's approvals. Here's what to fix.
Aleric Heck
December 26, 2025
In partnership with
The AI marketing landscape just delivered some fascinating insights right in time for the holidays—and I couldn't wait to share them with you before you dive into the festivities.
Here's what's particularly striking this week: while everyone's been focused on AI's promise to slash production costs, a hidden problem has emerged that's catching marketers off guard. AI can now collapse a 7-week campaign timeline into just 2 weeks... but approval processes built for quarter-long shoots haven't budged. As one chief creative officer put it: "AI moves in minutes and clients move in weeks and months."
That disconnect is costing teams real money—and it's reshaping how the smartest agencies are structuring their entire workflows.
📍 In Today's Newsletter:
The hidden costs lurking behind generative AI adoption (and how to avoid them)
Why 36% of CMOs are planning headcount reductions—and which roles are most at risk
Voice commerce's explosive trajectory toward $50B+ annually
A powerful new tool that turns product links into video ads instantly
The mobile-only shift that's making "mobile-first" obsolete
Let's dive in.
📈 Today's Top AI Marketing Story
Here's a paradox that's becoming impossible to ignore: 58% of marketers now use generative AI for content creation, yet many are discovering that the savings they expected are being eaten by unexpected costs.
The culprits? Three main issues are emerging:
Infrastructure investment — Building proprietary AI production systems (like Unilever's semi-automated approach) requires significant capital. As industry experts describe it, you're essentially "building your own house instead of renting someone else's."
Unpredictable usage-based pricing — OpenAI and competitors charge by usage, making budgets harder to forecast, especially during high-volume campaign periods.
The approval paradox — This is the big one. AI has collapsed production timelines dramatically—Hogarth reduced promotional campaigns from 7 weeks to just 2 weeks using generative AI. But here's the catch: approval processes designed for traditional production schedules haven't adapted.
The smartest organizations are responding by overhauling their briefing processes entirely. They're using AI to generate higher-quality creative briefs before submission to agencies, reducing revision cycles and approval delays.
⚡ QUICK ACTION TIP
Audit your current approval workflow this week. Map out each touchpoint and identify where AI-generated content gets stuck waiting for human sign-off. Then work backward to create pre-approved templates and guidelines that let AI-generated variations flow through faster.
🚀 AI Marketing Quick Hits
Voice & Conversational AI Becomes the Default
ChatGPT's voice integration (launched November 25) marks a genuine inflection point—real-time voice, text, and visuals now operate in a unified interface with no mode-switching required.
Why This Matters: Voice interactions are showing 40-60% higher engagement than text-only sessions. Industry projections suggest 50%+ of AI interactions will include a voice component by mid-2026, with voice commerce expected to exceed $50 billion annually.
✅ Action Item: Review your top-performing content pages. Do they read naturally when spoken aloud? Add conversational FAQ sections with proper schema markup to capture voice search queries.
36% of CMOs Expect AI-Driven Headcount Reductions
The Spencer Stuart CMO Survey (November 2025) quantified what many suspected: over a third of chief marketing officers expect to reduce team sizes over the next 12-24 months through AI utilization or operational streamlining.
Why This Matters: This represents the first major quantification of AI-driven marketing job displacement. Content production, campaign optimization, data analysis, and customer service roles face the most pressure.
✅ Action Item: Position yourself (or your team) on the strategic side of this shift. Focus on developing skills in AI oversight, creative direction, and strategic planning—the areas where human judgment remains essential.
Mobile Dominance Is Now Absolute
For the first time, mobile exceeded desktop by a significant margin during peak shopping days: 56.1% of Black Friday purchases and 56.5% of Cyber Monday transactions happened on mobile devices. Digital wallets (Apple Pay, Google Pay) processed 38% of those mobile transactions.
Why This Matters: "Mobile-first" design is no longer sufficient. Organizations must adopt "mobile-only thinking"—designing for mobile first, then adapting for desktop. Vertical video becomes standard; horizontal becomes the exception.
✅ Action Item: Test your entire purchase funnel on mobile using only one thumb. Any friction points? Fix them before Q1.
AI Traffic to E-Commerce Surges 805%
AI-driven traffic to retail sites increased 805% compared to 2024, according to holiday season data. AI-driven leads showed 38% higher conversion rates, while AI-powered chatbots delivered 45% conversion rate improvements.
Why This Matters: AI isn't just changing how we market—it's fundamentally changing how consumers shop. Being discoverable by AI systems (whether chatbots, shopping assistants, or search overviews) is becoming as critical as traditional SEO.
✅ Action Item: Check whether your products and services are being accurately represented when users ask AI assistants for recommendations in your category. Test queries across ChatGPT, Google's AI Overview, and other AI interfaces.
Meta's Controversial AI Data Policy Triggers Backlash
Meta's December 16 policy update introduced one of the most controversial changes in platform history: AI conversations from Facebook and Instagram will now inform personalization and ad targeting, with data shared to Microsoft. The announcement triggered organized "Blackout" boycott campaigns and viral opt-out guides.
Why This Matters: For marketers, this creates a paradox. On one hand, hyper-granular intent signals from private AI conversations could reveal purchase intent before traditional search behavior. On the other hand, there's real reputational risk and potential reduced reach if boycotts gain traction.
✅ Action Item: Accelerate your first-party data collection strategy. Privacy-first brands are gaining competitive differentiation as consumer concerns intensify.
🔍 Featured AI Tool Spotlight
Notch — Cinematic Shorts
This just launched, and I'm genuinely excited about the possibilities here.
What It Does: Notch converts product links directly into conversion-focused video ads. You paste a link, and it generates fully customizable video content designed specifically for sales—at a fraction of traditional production costs.
What Makes It Noteworthy:
The timing couldn't be better. With video content dominating engagement across every platform and production costs remaining a barrier for smaller businesses, Notch addresses a real gap. It's not just another video generator—it's specifically optimized for conversion-focused commercial content.
Potential Use Cases:
E-commerce brands needing rapid product video content for social ads
Agencies managing multiple client campaigns who need to scale video production
Small businesses wanting professional-looking video ads without the production budget
Affiliate marketers promoting product-based offers
What You Can Do With It:
Generate video ads directly from product URLs
Customize outputs in real-time to match brand guidelines
Produce multiple variations for A/B testing without reshooting
Scale video content production without scaling costs proportionally
🔗 Explore Notch: notch.ai (Note: Verify current URL and pricing on their official site)
Get 5 Days of Unlimited AI YouTube Scripts
Our Gift: 5-Day Unlimited Access to VideoIdeas.ai's Full Creator Suite
VideoIdeas.ai is Your Complete AI YouTube Content Factory (Trusted by Channels with 600k+ Subscribers!)
If you've been grinding on YouTube, you know that consistent, quality content is the only path to growth. And you know that writer's block and endless planning sessions are killing your upload schedule!
Now imagine having AI that can generate complete video scripts in minutes, analyze your channel for fresh ideas, and even clone the style of top creators – turning you into an unstoppable content machine.
By Popular Demand, you can now get…
FREE 5-Day Unlimited Access to VideoIdeas.ai - Create Unlimited Scripts & Ideas!
What You'll Unlock During Your 5-Day Trial:
✅ Unlimited Full Video Scripts - Generate complete, ready-to-film scripts on any topic
✅ AI Channel Analysis - Get personalized video ideas based on YOUR content
✅ Viral Shorts Generator - Create engaging short-form scripts that explode
✅ Style Cloning Technology - Replicate the tone of any successful creator
✅ Video Ad Script Builder - Turn viewers into customers with compelling ads
✅ Zero Restrictions - Full platform access, create as much as you want!
🛠️ More AI Tools Worth Exploring
Analytify — GenBI Platform
Category: Analytics & Business Intelligence
AI-powered analytics generating fast business insights through intuitive dashboards
User feedback emphasizes impressive speed and well-designed interface
Transforms complex data into actionable visualizations
Mistral AI OCR v3
Category: Document Processing
Document understanding with 94-95% accuracy on complex layouts
Processes 2,000 pages per minute
Outputs structured JSON/Markdown for easy integration
Ideal for agencies handling large volumes of client documentation
Runway Gen-4 Turbo
Category: AI Video Generation
Generates clean motion in 3-5 seconds with minimal distortions
Perfect balance of speed and quality for social content
Excellent for ad creatives, Instagram reels, and character animation
Currently considered the standout video tool of December
Ideogram 3.0
Category: AI Design
Multi-font text composition for posters and ads
Addresses one of AI image generation's persistent weaknesses: accurate text rendering
Strong contender for marketing materials requiring precise typography
Shoppers are adding to cart for the holidays
Over the next year, Roku predicts that 100% of the streaming audience will see ads. For growth marketers in 2026, CTV will remain an important “safe space” as AI creates widespread disruption in the search and social channels. Plus, easier access to self-serve CTV ad buying tools and targeting options will lead to a surge in locally-targeted streaming campaigns.
Read our guide to find out why growth marketers should make sure CTV is part of their 2026 media mix.
💡 Pro Tip of the Day
Restructure Your Briefing Process to Match AI Speed
The agencies seeing the biggest gains from AI aren't just using it to produce content faster—they're restructuring their entire briefing and approval workflows to match AI's pace.
Here's the implementation approach:
Step 1: Create pre-approved style guides and templates that define acceptable variations. This lets AI-generated content flow through without individual approval on every asset.
Step 2: Use AI to generate higher-quality creative briefs before they go to production. Better input = fewer revision cycles = faster approvals.
Step 3: Adopt a "component mindset" where post-production dominates your workflow. Instead of one monolithic approval, break campaigns into modular pieces that can be approved independently.
Step 4: Set up tiered approval levels—routine variations get auto-approved within guidelines; only genuinely new creative directions require full stakeholder review.
📊 Success Metric: Track time-from-brief-to-live. Hogarth reduced this from 7 weeks to 2 weeks using these approaches. What's your current timeline, and where can you compress it?
⚡ Supercharge Your Ad Targeting
Speaking of working smarter with AI—all these developments in AI-powered marketing only matter if you're reaching the right audiences in the first place.
That's exactly why we built KeywordSearch.com's AI Audience Builder.
While you're navigating voice search optimization, mobile-only design, and approval workflow restructuring, your ad targeting shouldn't be another time sink.
What You Get:
AI-powered audience creation in seconds (average: 2.6 minutes to your first audience)
One-click sync directly to Google & YouTube Ads
Pre-built targeting templates across every major niche
Access to 100k+ competitor ad examples for inspiration
Try It Free for 5 Days — unlimited access, no credit card required, no obligations.
🔮 Looking Ahead: What to Watch
The Zero-Click Future Is Accelerating AI Overviews now trigger on 40% of queries (up from 25% in September), with a 61% CTR drop for the #1 organic position when an AI Overview appears. Being featured in AI Overviews now matters more than traditional ranking for many queries.
Open-Source AI Is Reshaping Economics DeepSeek released V3.2 models claiming GPT-5 parity on advanced reasoning benchmarks, under MIT open-source license. Mistral announced an 11.7 billion euro funding round. Both developments reduce dependence on US providers and lower infrastructure costs for privacy-conscious applications.
Social Commerce Is Primary Revenue Now TikTok Shop generated $3.2 billion GMV during BFCM weekend alone—127% growth versus 2024. Live shopping events saw top creators driving $50K+ per hour during peak windows. Social platforms aren't just marketing channels anymore; they're shopping destinations.
That's a wrap for today's newsletter. Wishing you a wonderful holiday—and I'll see you back here soon with more AI marketing insights.
Aleric & Greg KeywordSearch.com
P.S. Curious how AI can supercharge your ad targeting? Take KeywordSearch for a test drive with our unlimited 5-day free trial and see for yourself. → keywordsearch.com
This AI Marketing Newsletter is Also Sponsored by:
Can you scale without chaos?
It's peak season, so volume's about to spike. Most teams either hire temps (expensive) or burn out their people (worse). See what smarter teams do: let AI handle predictable volume so your humans stay great.