The News
The Dor Brothers became popular with AI-generated music videos of Kamala Harris flipping the bird and President Donald Trump puffing a cigar over a burning American flag.
Now, they find themselves in one of the hottest sectors of the US economy, bringing in corporate clients and attracting investor interest as a new kind of AI content studio.
The German company charges roughly €200,000 (about $235,000) for its larger advertising spots, said CEO Yonatan Dor — part of a rapid turn by brands looking to save money on production, or simply feeling the pressure to at least dabble in the hot technology. (Yonatan’s brother is no longer making videos with the company.)
The AI revolution was born, in no small part, out of the advertising industry. Researchers at Google, whose revenue primarily comes from advertising, shepherded the breakthrough that birthed today’s AI industry. And many of the other key players, including Meta, are fundamentally ad companies. So it’s no surprise that marketers have adopted AI, using it for everything from brainstorming to media buying to physical ad production. An April report by advertising automation platform Basis Technologies found that 76% of global ad agencies plan to boost AI spending this year, with 70% already using it multiple times a week.
“The beauty of AI is that if I generate a video and something happens that I would have never expected, I can use that,” Dor told Semafor, adding that some marketers aren’t ready for the spontaneity that AI creators provide. “They want all the storyboarding, and it’s like [they] have to ruin everything that’s good about AI by forcing an older way of making things.”
Consumer brands like Coca-Cola and Toys “R” Us have published AI ads, and Meta is preparing AI tools to let brands create personalized campaigns by next year. Meta and Google, which offer both AI-generation tools and ad distribution platforms, are well-positioned to create a one-stop-shop for marketers.
“Marketers Are Serious and Excited About Adopting AI—But Also Stressed,” read a representative headline in AdWeek. Making AI ads typically requires fewer people and different skills — ones honed by AI-native creators like Dor, who spend their days working inside video generation tools like Google’s Veo 3, Kling AI, and Midjourney.
Much of the promise of the technology is how it will level the playing field. AI production could help small- and mid-sized companies create production-grade campaigns without the budgets of their larger competitors.
One of The Dor Brothers’ most viewed ads, which aired in Times Square, depicted a bull and bear dancing on Wall Street for Israeli trading app eToro. (The company’s head of creative marketing, Shay Chikotay, said he wasn’t concerned about the studio’s other content.) eToro has also worked with Los Angeles-based AI studio Secret Level and creator László Gaál to make other AI-generated ads, in addition to developing some in-house.
“The agility and production costs of working with AI are significantly lower, which means we create better [ads],” Chikotay told Semafor. AI is also allowing the company to create more commercials in different languages, with content specific to individual locations, which he said is a “much more human experience.”
“It’s the golden era of production and advertising,” he said.
Know More
In one of the highest-profile exhibits of AI advertising on television to date, betting marketplace Kalshi aired an AI-generated ad during the NBA finals earlier this year. PJ Accetturo, the former television producer behind the ad, told Semafor he made it “in like two days in my underwear.” His content studio, Genre.ai, charges around $100,000 to make a 30-second commercial, though he only spends a few thousand dollars for credits on Veo 3 to create them.
Depicted in the 30-second Kalshi ad: an alligator wrestling match, a jet ski chase, and explosions. Elaborate productions like that can cost in the hundreds of thousands to millions of dollars, while an AI studio could produce them for much cheaper and finish them in a matter of days.
“Capitalism is going to capitalism,” Accetturo said. “If you can compress six- and seven-figure budgets into five figures — where you’re getting 90% of the same look and fidelity — why wouldn’t you switch to AI?”
Step Back
Advertising firms have long invested in tech companies that focus on data and analytics. But more recently, they’ve also taken an interest in AI startups that work more closely on ad creation. Earlier this year, Adweek reported that 50-year-old advertising agency R/GA made its first-ever acquisition in Addition, which has developed AI-powered campaigns for clients like Google and Realtor.com.
Rachyl’s view
Advertisers adapted to the rise of online content creators by shifting some of their spending towards influencer marketing, seeking to monetize the connection these creators maintain with their audiences. Globally, advertisers are expected to spend $33 billion marketing with creators this year, up from $1.7 billion a decade ago, according to media firm Influencer Marketing Hub.
Marketing through influencers allowed brands to cut some costs, offload the burden of producing advertising, and differentiate themselves — all of which AI studios are now offering. AI won’t replace influencers outright — there will likely be brands and products that sell better with a human touch, like skincare. But as AI studios grab more of available marketing budgets, creators may face fiercer competition with each other and with new technologies — and may have opportunities to capitalize on artificial intelligence themselves.
Room for Disagreement
Some in the ad business consider many of the current crop of AI ads weak and gimmicky. Coca-Cola received blowback for a Christmas commercial last year, which some called “soulless” and “devoid of any actual creativity,” NBC reported. The resulting public relations flare-up for the company pushed Coca-Cola to justify its decision to journalists. Nearly half of consumers across global markets are “uncomfortable” with the use of AI in ads, according to a 2024 survey from market research company YouGov.
Notable
- WPP Chief Technology Officer Stephan Pretorius disputed that AI will displace workers in his field: “AI replaces tasks, it eliminates tasks, it doesn’t eliminate jobs,” he told The Guardian. “A lot of what we used to get paid for is now getting automated and therefore our commercial models have to change, our team structures have to change. The way we are incentivised by our clients is changing. But that is the transition.”