Commerce Crashes Cannes

[00:00:01] Phillip: Hello, and welcome to Future Commerce, the podcast at the intersection of culture and commerce. I'm Philip, and you can see I'm not in Florida. I am in London, and this is Borough Market. It is an outdoor market that is near London Bridge, and I would say is one of the places where culture and commerce collide. It is also the place where I have been basing my operations out of for the past month, and it is also the place where a lot of people wound up post Cannes - and that's, of course, the Cannes lionsFestival for creativity.

[00:01:50] Phillip: We had a lot of people in the Future Commerce ecosystem who have wound up in Europe and passed through London in the last few weeks. I did get a chance this week to sit down with Michael Miraflor to talk about the Cannes lionsFestival and all of the conversation, some of the controversy that took place during and after this year's Cannes Festival. And I wanted to break down some of the points and counterpoints around this year's Cannes Lionss. Of course, this should be the celebration of creativity in our ecosystem, and what historically was an advertising-based awards and creativity ecosystem, is now also a retail media conversation and, also a very technology centered conversation. So who better to speak on that topic of what that festival was and what it is today and where it might be going in the future than Michael Mirofloor, friend of the podcast, and he sits down with me for about an hour to discuss it. And we do touch on some of those more controversial subjects. I think it's well worth your time as our subscribers, and I think that this is a pertinent and a very important conversation for this moment. So without any further ado, let's go to my conversation with Michael Mirofloor on the podcast. Oh, I'm coming to you, Michael, from a nondescript Airbnb here in London. It's probably, like, fourth week here in London. I know that you spent a good amount of time in Europe. You were hopping around a bit post Cannes, but I'm glad to have you back here on Future Commerce.

[00:03:26] Michael Miraflor: Thank you. Thanks for having me. And, I just got back about thirty hours ago. So a bit jet lagged, but awake enough for this conversation, hopefully.

[00:03:37] Phillip: Yeah. Well, yeah. And there's a lot to talk about. I was wondering and maybe a little concerned that maybe the Cannes conversation would be a bit old and tired, but I think the conversation is banging on. I think there's been a little bit from AI manipulation controversies and some discourse that continues to bang on around DEI debates and award withdrawals. Cannes seems especially charged this year. There's a lot to talk about, but I think just even the energy on the ground felt especially charged. It seemed like there were more people from even the commerce industry that were more involved this year, and for a lot of us, you were the person who was actually the one who was doing the on the ground reporting. I felt like I was living vicariously through you. So you're the veteran. I would love for you to give us your perspective on Cannes, and that's why we brought you here today. I thought we'd get into that today, but for those who aren't familiar, what are you up to these days?

[00:04:39] Michael Miraflor: I'm up to a lot. I feel like I'm sharpening all the tools on my Swiss army knife of capabilities and helping out everyone from agencies to platforms to publishers, everything in between these days. So I tested explaining what my role was in the ecosystem at Cannes and I landed on being a marketing mercenary. That's what resonated with people the most. You know, otherwise, it would take me three or four sentences, and of course, that's provocative. But Matt Klein said that's the thing at Cannes when we were having conversation that landed, so I'll take that from him.

[00:05:21] Phillip: I like that. And you were marketing mercenary on behalf of a handful of companies, one company in particular. What was your goal or your mission while you were there?

[00:05:31] Michael Miraflor: So I worked with Paid, which is a creator platform. So they brought me over with them. We had been working for a few months together to help prepare them for their first ever Cannes. And so, from someone with several years of experience preparing for, helping people on the ground and with everything from planning to execution, I was their guy. And I also had a couple of people on the brand side that I was helping out, also, their first time in Cannes. So that was the completely other side of, if you want to call it, a marketplace. So I had my hands in a few places, but that's how I tend to operate these days.

[00:06:11] Phillip: You're a big proponent of sort of making the most of the multifaceted sides of an event like this. I knew you before we actually ever met. I knew you as the sort of ambassador of events like this, like CES and sort of understanding the layout, understanding the culture of an event like a CES or Cannes and sort of making the most of it. And I would follow you on social media as sort of the eyes and ears there. This is your, I don't know. How many years have you been attending Cannes?

[00:06:49] Michael Miraflor: I think this was my eighth year.

[00:06:52] Phillip: What has changed in that time?

[00:06:57] Michael Miraflor: I think I have unique perspective in that the first three or three to four times I went, I was on the agency side. And that was on the big agency side, like a holdco. So I would be the recipient of a lot of the invites or a lot of the access that is rolled out. Another way that I guess you can frame that is that I was on the buy side. So that's a completely different experience than being on the sell side or helping a platform or a publisher get in front of marketers and agency folks. I had also attended as an operator in every sense of the word as a consultant over at MediaLink. So that is one of the primary companies that helps facilitate the collision of sellers and buyers on the ground. But that's all within the context of the culture or the micro culture or whatever you want to call it that is can that exists during the week. And it's everything. It's physical. It's emotional. It's people that you've known your entire career. And everyone gets there on the same weekend. All of the builds go up miraculously within no longer than a seventy-two-hour span.

[00:08:14] Michael Miraflor: On Monday morning, things are still being bolted and nailed and wrenched. And then it all comes down starting on Thursday evening, right? And then by the weekend, everything is gone. So I think the physicality of it, basically a small town being built on top of a city that is already frequently visited by tourists, and then having it all kind of wind down within the course of five or six days, it's a real rush, Right? Add to that, it was extremely hot this year. Yeah. I know you're feeling it in London right now, but the heat wave really started as everyone was touching down in Cannes. I think that added a bit to the character of it all this year in that everyone was sweating through everything they wore. Everything from blisters to trying to find shade to those who were lucky came equipped with those little bootleg Dyson motor fans. And that really made the merch game important this year as well. Like, I don't know if some companies strategically prepared for a heat wave, but things like hats, umbrellas, mini fans, I mean those went a lot further than your typical merch fair.

[00:09:32] Phillip: I guess that sort of gives me the feeling of what it was like to be there in person, but there were a lot of people and there's a lot of discourse about the tenor of the event, and I'd like to get into some of that, but , how does that, how would you say this year's social media reaction to Cannes compares to prior years? Because I think like we're I think there's more exposure at least in the commerce industry to an event like CAN these days than there has been in the past which I would have maybe ignorantly relegated more to like the marketing or to an advertising and industry event, right? So I think the commerce industry is much more exposed to this now than we've ever been before and maybe there's more voices that are contributing or more folks that are feeling like they should insert themselves into discourse. I'm curious if you think that's part of what's making this event more visible or if this has always been the case. And maybe we then we can talk to some more of the commentary. But how's this conversation around Cannes been like at like what has been we've seen this year, or is this something new?

[00:10:58] Michael Miraflor: It felt different this year. It did feel like there was more commentary from the likes of which you wouldn't have expected in the past. I think a part of it is the new channels that exist. Retail media networks being a huge channel of -- I don't want to say new, or maybe it's repackaged -- distribution for a lot of big brands to find additional or incremental reach. That's one. And alongside that, you have the big behemoths like Amazon. Amazon had, I think, more square footage than... Or they had as big as square footage profile as anyone else along the beach. It was really impressive. But there were a lot of independent agencies and operators as well. There were a lot of creators on the ground. I think this feels like it was really year one for creators to be acknowledged and established as being not just the talent or the entertainment part of the evening, but they were sort of, in a way, creators are an all-in-one, right? Like they are the distribution, but they are also the creatives. And in an interesting way, it kind of fills the gap and directly addresses the friction that was also talked about a lot this year, which is the increasing distance between the commercial activity that was happening on the beach, which has been taken over mostly by tech companies over the past decade, and the Palais, which is that's where the film festival happens.

[00:12:36] Michael Miraflor: That's where all the talks happen, but is increasingly expensive, increasingly gatekept, and is almost exclusively attended by the creatives that also attend. So I guess another way of indirectly answering your question is that, Ken, for as large as it is, I think they said around 13,000 people attended this year, and that was just people that could be tracked. Uh, I felt like there were maybe three conferences in one. Right? So you can have a badge, can have an official Cannes badge and try to spend as much time listening to very smart people in the Palais and going to the actual creative award ceremonies every evening where the case studies are played and the lines are handed out. A lot of pomp and circumstance, it kind of feels like you're being at the equivalent to the Oscars for commercial creativity, which is what it is. Or you could not have an official badge and you can have all these invites to all the stuff happening on the beach and you're in a dozen different WhatsApp groups with people that you know throughout your have known throughout your career trying to get in contact with, organize things. And then there's a long list of people that you want to meet that you know are there. Right? And that's in addition to whatever you are kind of preordained to be doing from a business perspective.

[00:14:03] Michael Miraflor: So everyone kind of has a role on the ground, right? Like very few people go to Cannes without an agenda. It's either you're celebrating the work that you've done and you're trying to generate new business, or you are literally a seller, or you're looking to find new vendors. Or, I think what's been growing over the past few years are people that attend Cannes that aren't in either of those camps but find a lot of value in attending. And this year, that's where some of the conversation came from as well, I think there were a lot of people there and a lot of people not there that had interesting conversation about the value of being there. And I think it's a noteworthy one because it is quite an investment. It does look very, you know... It's the South of France, so people are gonna be doing South of France things. Think there's an assumption by some people that there isn't really business getting done because all the Instagram uploads kind of portray us or you know, it's it seems very lifestyle. But, know, there are there are a lot of people that attend, and it's just it's work twenty four seven, and it's exhausting while you're there because because of the environment.

[00:15:18] Phillip: I would like to get into some of that. But, I do think that, just kinda coming back to the... Something that I feel like was said... I don't know if it was you or someone else I was I was speaking to who also attended, a good friend of ours, but we should probably -- I mean criticisms aside, we should always level critique. I think that nothing is above reproach like we we should be able to level critique if we see room for critique, especially of any large organization. But, how many places are there in this world that celebrate creativity? And Cannes is a festival that celebrates creativity and arguably the largest one. We should probably in a world that we're trying to manufacture and rubber stamp creativity through AI, shouldn't we be trying to uphold and celebrate the last place that is giving creatives some sort of... Is awarding creatives for their creative work? And I felt like that was a really interesting counterpoint to some of this social media discourse around the lifestyle of the Cannes lionsfanfare and the festival and the event. I'm not sure what you think about that as the counterbalance to the cost of it all and the discourse about the lifestyle of that culture of the event.

[00:16:52] Michael Miraflor: I think part of that friction or that discourse, as you called it, comes from the fact that there are a lot of people that have been increasingly attending over the past decade that I don't wanna say care nothing about the actual creativity happening in the Palais and all the creative directors that attend who they might never bump into or have any sort of dialogue while they're there. That, to some people, has been noticeable. And that is a worthy conversation, especially if you boil it down to brass tacks, you have people meeting with each other that it's cliche to say, but this meeting could have happened in New York or Los Angeles or London or maybe even Miami, right? But that's just the way that global business gets done these days. You know, a conversation that you have in the South of France will probably stick, or be easier to refer to in the future than your standard meeting in a conference room in New York. Like, that's just what it is. I do agree with you that there are fewer congregations or concentrations of creative or smart people that get together to celebrate the act of commercial creativity. Like, don't know where you would really find that unless you kind of stacked a bunch of events globally on top of each other on a year long calendar. So to me, that's one of the benefits of going to Cannes is that there are so many people. I mean, there are advertising legends who attend. And then there are just very smart strategists that found their way there that, they want to have that collision, right? And those things happen. You have to lean into it. You have to put effort into getting access.

[00:18:46] Michael Miraflor: Like nothing just comes your way if you're not on the buy side. But magic happens at places like that, as you know. Right? And it is a choose your own adventure because no one comes back experiencing the same thing that anyone else experiences. Like every day is different for everyone. And again, all those things that you want to do are on top of the things that you need to do because most people are there to get something done and to work. So I mean, other than Cannes Lionss, mean, is a celebration of creativity to an extent at places like CES, maybe Mobile World Congress, not really. South by Southwest. I know a few friends that are at the Aspen Ideas Festival that is happening right now. Davos has become something of a gathering for smart people, even if they're not involved in anything. Geopolitics. It's sort of besides the fact, right? Like it's about the people who that caliber of conversation attracts, that becomes the gravity, right? I think for the same reason, people flock to things like Art Basel Miami Beach on the flip side, because maybe they just want to be around interesting, sophisticated, sort of a certain brand of creativity that's difficult to access elsewhere. You don't have to be in the art world, but you get enough of it as long as you're halfway intentional about it, right? Because you know that there's a collection of people, there's a critical mass of people there where you could have the conversations or exist in that environment. And I think for commercial creativity, Cannes is one of the only places to really get that global perspective and to get all those people in one place.

[00:20:35] Phillip: It's interesting when the shortlist is does incorporate a few of those places, yeah, I think have been Davos is a good example of one where the, like the the long-standing critique is that these are events that are for elites. I find it interesting that a lot of the criticism come from people who have jobs in creativity that I think are quite elite jobs. In my field, I feel like we're all quite lucky to be where we are. I do think that there is a general tenor of being... We can be critical and I think my job has been to be critical.

[00:22:20] Phillip: I am a critic. I think that's what I do for a living. If I'm being really honest, I'm critical of work that we do in this industry. I write criticism for a living to some degree. But I also think that we all have some element of privilege to be able to do that kind of work. And so I do think that there's a challenge inherent in that we all have, we all sort of benefit from the existence of that system, whether we're participating in it or not. And by the way, like we at Future Commerce have also published a number of the critical pieces over the last couple weeks around the Cannes discourse. And I think that there's some really worthwhile conversations to be had there. We can actually post some of those. I think there are some really interesting conversations to be had there. I think what would be interesting to to see is that more venues to be outside of the criticism to see more venues be offered up as alternatives. Like we I'd love to see more grassroots movements or more accessible alternatives be offered up or some people to band together to create more opportunities. Maybe that's something we can sidebar about as a community, but anyway.

[00:23:34] Michael Miraflor: Yeah. It's all fair. I mean, if you really wanna take a trip down memory lane and the years that predated it becoming more of a commercial conference, like it was a pure celebration of creativity and pretty much only creative agency, creative directors and copywriters and you know, that side of the industry are the only ones who really cared about Cannes. Like that was who it was for and it was a much smaller conference. And I am friends with a few people that are a decade and a half, couple of decades my senior who tell stories about what Cannes was like in the days predating the tech platforms taking over the beach and well prior to ad tech and even media agencies being involved. And it sounds like it felt very different. And in a lot of ways, I feel very envious for the type of experiences that they had. In a way, from a pure creativity, capital "C" perspective, it felt like a bit of a retreat for some of the greatest minds that created commercial capitalism, I guess. You still have advertising legends attending and giving talks. And you could bump into them on the beach, in the Carlton, in any one of these activations up in the hills. But they're no longer the only draw. Right? Mhmm. And there's something to be said about the necessary trajectory that any big global conference needs to follow or adhere to or adjust to to make sure that they're still relevant over time? Like, if you took away all of the tech companies and platforms and big agencies from the beach, what would Cannes Lions be reduced to? I'm sure a lot of people would be happy about that prospect, but I don't know if it would even make enough money, like, let's keep it real, to sustain still having that award ceremony in 2025. I mean, that isn't to say that it's not important. I think that I am maybe one of a few. Like, if you would separate all the attendees of Cannes Lions into different buckets. Right? Like, there are the the pure creatives from creative agencies that are there because they're going to win awards, And they're there to to learn primarily to learn. And then you get people who are there primarily to make deals. And then you get another bucket of people that are there to be around great thinkers or they're there to network. I felt more of that this year than I had in previous years. Like, people who just wanted to be where other people who they admire and respect and would like to work with are. And then there's another bucket where you kind of dip your toe into each one of those things. And I think I'm one of those, in that... I knew quite a few people and this was the first time that I've attended that so many people that I knew mostly through the Berlin School of Creative Leadership where I got my MBA. A lot of those alumni are Brazilian. Brazilians kinda dominate the award ceremony. So I was in a couple of group chats where every evening during the award ceremony, there would be an explosion of celebration, pretty much, and sending congratulations to people who are on stage winning some of the biggest awards in commercial creativity in the world. So meeting up with them and just seeing the joy that comes out of that was a very unique but different experience than the value that I got from hanging out over at any one of the villas that were sponsored by any one of the social media platforms. That also has its upside, but is a very you know, these are very different worlds. Wow. So it's like I just the fact that these different -- it feels like there's different conferences happening within this single week, celebrating so many things. And you know that isn't to say that striking a deal or advancing a conversation on the commercial side is also not something to celebrate. I mean this is to your point, yes we're all privileged to be there but you know this is us doing our jobs.

[00:27:57] Phillip: Forgive me for overthinking, but this is what I do. I would say that this is what's indicative of a culture that's formed is that Cannes, too... It is indicative of what a you know, is its own culture and sort of a functioning culture and people outside of that sort of in group don't understand how that necessarily works but we have a, in any given sort of culture you have people that have people that produce that are producers of like cultural artifacts, like they may be in some in some cultures that might be like valuable pieces of art. There might be economic creation, things that, like, have value. So maybe in Cannes, like, this is works of creativity. Um, you have people that are critics of that work. You have people that are collectors of that work, and you have people that are curators of that work. I think that's sort of what makes up in my mind a culture that's sort of a functioning culture, and people that outside of that culture don't really understand it. And I so the role of a critic use just you can be a critic without being inside of the end group, but I think being in the end group is the person who creates the commercial value of the cultural production and the critic of the the cultural production is the one who actually creates the value that makes all of the other three groups worthwhile, the collector the curator and I think that's where we have sort of discounted this this or not understood the reality here is that maybe there's something bigger at play, is that each one of these events have actually become their own sort of functioning sort of cultures or subcultures. And to that degree, when we start bringing in more people from the outside -- retail media is a good example -- they start to grow, they attract more attention, and now there's sort of an adaptation of the culture that's necessary. And I think that's always a challenging shift to make. Maybe it happens a little slower with tech, but I think it's a little more difficult when you have the cultural production is performance marketing on Amazon.com. That was my two cents of the overthink. I don't know if you have any thoughts about that.

[00:30:40] Michael Miraflor: You know, from a critic's perspective, from the outside looking in, objectively, it's ridiculous. Right? You have a lot of the same companies making headlines for needing to lay off X-many thousands, or tens of thousands, if you're really adding everything up in the industry, but also spending millionsof dollars per company to send groups of people over to the South of France to have to ostensibly have conversations about advancing business or striking deals or celebrating an industry that some would argue is in dissent. And there was a lot of that. I think it always looks indulgent from the outside looking in, but I do feel like there was a bit of a layer of kind of existential dread, you want to call it that, in some conversations. Obviously, everyone is there to celebrate, everyone is happy to be there. I think that very few people who go to Cannes lionsactually live that lifestyle. You know, part part the reason why everyone stays in Europe for a couple of weeks after going to Cannes Ligne is because, like, they they wouldn't be in the South of France or have been able to use that as a home base if it weren't for you know, having to having to be there for work or for that event. It it was inevitable that every other conversation that you would have would become one about AI replacement theory to a certain extent. Or jokes about, like, how we're like, this year feels like we're all on the Titanic. And everyone's just seeing who has the best violin to play while everyone is seeing the iceberg coming in the form of AI.

[00:32:36] Michael Miraflor: But it's not like those conversations, that sort of existential dread hasn't happened, maybe to a lesser degree in the past because this is a festival. And I think there's a big difference between a festival and a conference. I still think that Cannes Lions is a festival. Maybe there's a conference within the festival at this point because of all the commercial activity. But yeah, I mean, every significant digital disruption that has happened that has affected publishing or advertising distribution or any of these fundamental things that kinda grease the wheel of capitalism has been felt at Cannes and has been discussed. I think most people would admit that this year feels different because we're on the precipice of extraordinary change. And that was discussed explicitly almost everywhere you went. People leaned into that conversation. Obviously, if you're at one of the social media platform, beaches, they're going to address it with products. They're like, Here's what is actually going to enhance creative output or help you brands get business done more efficiently, more effectively, blah, blah, blah, blah, blah. But you head up into the hills to any one of these more curated conversations about the state of the industry or looking forward, and then you get maybe a bit more of a raw expression of the fears and opportunities. You know, like And the smaller the gatherings, I think the more likely people would be to actually express concerns about the different directions that things were going. And I think everyone would admit that it is a huge question mark, but it's not something that people ran away from.

[00:34:25] Michael Miraflor: I don't think anyone was there to celebrate creativity without there being a bit of fear about like, okay, how are we going to define creativity moving forward? Like, if it's going to be in the is it going to be more in the context of what's happening on the beach or what tends to be celebrated in the Palais? I'll tell you that in the Palais, I went to two awards evenings. Right? And that does take some compromise because they're in direct conflict with some of the -- it happens around dinnertime. Right? So it's a little bit of a shuffling of the schedule. But I went the evening that the Luxury Lions and I believe the Commerce Lions were also given away the same evening or awarded the same evening. But the word craft was used so many times in that evening. It was almost like it almost felt like a passive aggressive affront to everything that was happening outside of that building, which made for a really interesting friction. But from a critic's perspective, it's it's a necessary one. Right? And, again, people didn't run away from that conversation. Everyone kind of expressed their peace, but everyone knew that next year, the year after that, it would be a different story. Like, we're writing it in real time, right? You would hear that from creatives. You would hear that from technologists. You would hear that from strategists. You would hear that from salespeople, Right? Like, everyone's kinda wondering what it what this is going to look like from a conference environment perspective in the years to come.

[00:36:07] Phillip: I think that it's a really good bridge to sort of talking about what's happened since, because whether or not that was gonna be in years to come or now in the days since, know, we've now seen, some are calling it a scandal, think it's probably just inevitable. We've now seen a retraction of some awards that were given out because it's come to light that AI was used in the process of those campaigns that were we can link it up in the show notes.

[00:38:33] Phillip: I don't think we need to actually talk specifically about the agencies or the actual brands. But generally, I believe that if we were to go back to some original primary research that Future Commerce did in 2024, we found that 91% of people in the commerce industry were using AI whether or not their corporate policy allowed it. And I have to believe that we, even back in 2024, were already at the place of people taking the path of least resistance in their jobs whether or not their agency or whether or not their corporate policy would have allowed it. I believe, in this one particular case, people got found out or owned up to it. We're probably at just at the beginning of this and it seems like Cannes has drawn a line in the sand at least for now saying that this is not where we're gonna be, and not how we're gonna award for this moment. I'm curious if you have any thoughts on that and how we would look at AI as a tool or a creative partner going forward, and how that might evolve in the future. Or if it's the right call for this year and how that might change in the future?

[00:39:47] Michael Miraflor: There's two ways. I think there's more than one way to answer this question. I think to address the news that has come out in the past week and a half about certain campaigns not meeting the standards of Cannes Lions in terms of use of AI or not. That doesn't speak to the work. From my understanding, it's not like the creative product. It's not because... It wasn't disqualified because the work was generated in part or whole using AI. It's because the case study material in the form of whether it was press or other forms of PR or any of the evidence of success was doctored in sort of an intentional, malicious isn't the right word, but in a nefarious way to reflect a reality that didn't exist. That was more of the that I think that was more of the case with one of the the retractions, I believe.

[00:40:59] Phillip: I see. I see.

[00:41:01] Michael Miraflor: It was more in the case study evidence and like -- oh, that new that news clip that you included in your case study video that was supposed to be a real life reporter saying that whatever you did in the campaign was amazing that was actually, like, created by AI. So, it wasn't the work. It was the

[00:41:22] Phillip: Yeah. It's supporting. Okay. I understand now. So that is great. That's that's really great context to have included here rather than to have someone go have to fish that out themselves. So, yeah, that's helpful. Thank you. Yeah.

[00:41:38] Michael Miraflor: Yeah. Yeah. But the other way to answer your question is I don't think it is a huge question for most people that using AI tools is going to be a necessary part of just how we get work done, including creative work. This is gonna be really cliche, but like there was a way of getting things done prior to Photoshop, right? And then Photoshop became a standard. I'm not saying everything that we're doing with AI tools right now has been figured out or is even above board at this point. I think we're all still figuring it out. I do think it's really interesting to have conversations with people at Cannes and everywhere else, really, the extent to which people are utilizing these tools. It's very surprising. Some people who I would expect to be knee deep in this stuff are barely using it at all or just using it in a very shallow, kind of surface level kind of way. Then other people are kind of going full throttle, like building dozens of agents to do various things that help facilitate day to day, either for themselves or for their companies. I don't know if there's an easy way other than hanging out on social media, which isn't always reflective of reality of the extent to which people are actually leveraging these tools. I would have to think that people who adopt them and use them in an intelligent, productive way are going to come out on top because it is a force multiplier, right? I think that applies to indies as well as large organizations. Obviously, takes longer for large organizations to adopt anything at scale and there's institutional training and all that stuff. So it'll it'll be interesting to see over time how much the indies catch up to or become competitive to larger companies just because of the the reality of how long some things take to adopt and implement.

[00:43:28] Phillip: This happens at the same time. This is gonna seem like a sort of tangent, but I think it's closely related because it's it's something else that's happening in a unrelated field, but I think it speaks to a cultural tenor around the adoption of AI. But MrBeast this week released a an app for creators, which was a thumbnail generating app. So if you if you're an you know, a YouTube creator your your dependence on having a compelling thumbnail that drives click through is sort of your success metric for success on on was one of the key performance pieces on YouTube. MrBeast created an app that made that easier for creators, and it used AI to look at your video and suggest a bunch of thumbnails, and people in his audience sort of like lost their minds, and he he responded. He took he took this down and replaced it instead with a marketplace that suggested in his words, real thumbnail artists, like actual thumbnail artists. And my favorite of the comments on this thread in which he retracted the app was, let's get rid of photographers because oil painters need jobs, and I felt like that was a really great summation of the kind of things like, all progress is somewhat disruptive, um, but old technologies don't just sort of go away, like we still have they're still around, they're just probably not as as useful. They become artistic mediums. So yeah, it's inevitable I think. Between Marques Brownlee and you know, Jimmy Donaldson, I think we have culturally, there's not a lot of people that seem to be really buying into the idea of AI generated creativity, at least on the consumer side. So we'll we'll have to wait and see. I'm sure. Or maybe they're just the loudest voices. I'm not sure what you think about something like that. How far do you think we are from from our tenor changing around that? And should we be capitulating to the voice of the crowd in that space?

[00:45:48] Michael Miraflor: It's a great question. I don't think the next MKBHD or the next MrBeast can happen without leveraging a certain set of AI tools because that's just the way things are starting to get built these days. I haven't looked into the MrBeast thing too much. I've read a couple of short articles about it. But I have a feeling that it's because it's reflective of his audience's attitudes towards generative AI, which is pretty split. I mean, this is from just casual observation that I see on the Internet having to do with a certain subset of very young people. Not very young people, but young people being very anti AI or you know talking shit about other people using ChatGPT. Sure. And then you get the flip side of that coin is you know the viral video from the other week with the graduate from UCLA showing all the work that he did. You know, I think it was during graduation like ChatGPT but basically graduated for me. I think there is we talked about tension earlier the tension between craft and AI. I feel like that plays out all the way down to everyday consumers. And I think that conversation gets more interesting the younger you are. So I feel like Jimmy is a Mr. Beast is a he's a huge media company at this point. Or I shouldn't even say media company. He's a conglomerate now. So he has to listen to his customers. And he's a very smart business owner and operator, so he's going to do what he needs to make sure that his brand stays intact, Right? Because he really does care about what his audience thinks about him. Like, that's at the end of the day, that's that's that's what his continued success is predicated upon. Right? But yeah. How I mean, how many thumbnail artists are there out there?

[00:47:46] Phillip: Apparently, thousands. You know? He he spun up this marketplace in the space of a week, and people signed on in droves and made me wonder if I should go hire one myself so I could do better on YouTube because we we don't have the greatest YouTube following. I was like, hey maybe that's a thing we should be doing. I you know, so that's you know, there's there's that. And I do see like I think the word artist maybe throws some people off because there were definitely some some spicy comments there. But I do think that having having a there is a commercial there's a job there. Right? So there's a there's a commercial marketplace to be had. So maybe that's the best outcome in this moment for everybody.

[00:48:26] Michael Miraflor: I would have to think that something like thumbnail artists is sort of like a transitory job. And this is not to hate on all of the thumbnail artists out there that are probably doing well if they can command good budgets from their work. Because I do I do believe that it does move the needle. I mean, MrBeast has there was a episode of Colin and Samir where he went on one of his, like, three hour interviews, and he spent, like, twenty five minutes talking about thumbnails. It was insane. So it very important. But it feels like we're in this like liminal zone from the way things were to the way things will be. And the thing that's the cause for all of this disruption and how unsure we are about how things are going get done is because of AI. So I think even people who are successful thumbnail artists must know that they themselves are going to be disrupted by these tools that can get anything greater than 50% as good as what they're doing will probably not kill that market, but will really compromise it.

[00:49:29] Michael Miraflor: So I would have to think that the best thumbnail artists in the world are thinking about what they're going to pivot to next. And that might be an interesting proxy for all of us in this, like, white collar kind of creative creator strategist, like all you want to call the worlds that we inhabit from a commercial perspective. Like all of us should be thinking really hard about not just means to get to our output, but just the nature of the output as well. I mean, it's getting to the point where the AIs getting so good that you can get tricked. Even if you're really sophisticated and you're media literate, whatever that means these days, and you're extremely online, so you've kind of developed all these muscles to detect when things are bullshit. Things are getting so good that those detectors don't work as quickly as they used to. So what does that mean? What does that mean for all of us in terms of the means of production, right? Does it matter? Should it matter? What do your audiences think? Response

[00:50:41] Phillip: To anybody and so you say it's a maybe it's transitory. I'll give you the last word. I'll I'll I'll put this in there and I'll give you the last word because I feel like we're in a really great place because I really love what you had to share. Any YouTube is a platform and the law of platforms as future commerce sees it is that platforms will always consume the work of their third parties and eventually absorb the opportunity that the that their that their partners and their third party marketplace has built for them. So like a third party marketplace in an e commerce platform or any platform business recognizes opportunity, capitalizes opportunity in the marketplace, and then the platform proper cannibalizes that on behalf of the marketplace. So YouTube has already done this. YouTube has incorporated third party apps into its proper platform. It's done that with AB testing, it's done that with thumbnail testing, it's done that with analytics, and now it's done that creative conceptualization and trending topics. And I have to believe that if there is a thumbnail marketplace to be had or if there is AI thumbnail generation as a potential commercial avenue, eventually, who is the greatest generator of thumbnails? I feel like a well, YouTube is probably the best generator of thumbnails that will ever be. Um, so at some point in the future, the best thumbnail is the one that's purpose built for the person who's going to watch the video and not one thumbnail to rule them all. So I have to believe that's the eventuality. So yeah, it's all transitory is the thing I'm trying to say. It'll all eventually be competed away. Anyway, last word, Michael. I'd love to hear what what what else is on your mind, what you got going on next.

[00:52:28] Michael Miraflor: I think the second half of this year is gonna be an interesting one for me. The past few months have been pretty much just leading up to Cannes as the big thing which also represents a midpoint of the year. There are several projects that I'm pursuing, also some opportunities that, um, will look very different planning for something like a big singular event. So lots to look forward to. I know that's very vague, but because of NDAs and other things, can't really get into it. But you'll see it and you'll feel it. You know, I really appreciated this conversation. I feel like there's so much more that we can talk about. You know, I think at the end of the day it's a privilege to go to something like Cannes Lions. You know, I don't go every year. I've manufactured a reason for myself to go this year. That's how important I think it is. I know that not everyone shares that POV, and that's fine. If you can get the same sort of inspiration and satisfaction that someone like me gets at Cannes Lions at other places, more power to you. Keep on doing that, right? But I feel like I need to be in that mix. I need to find my place on the circuit of events around the world where people tend to congregate and talk about big ideas and celebrate creativity or whatever else, right? So different strokes for different folks in a way. But it's undeniable that Ken Lyon in 2025 is a much more interesting and nuanced value proposition to many more people than it was ten years ago.

[00:54:09] Phillip: I think that's a great place to leave it. Appreciate you, Michael.

[00:54:12] Michael Miraflor: Thanks, Phillip.

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