AI, Web3, purpose and SVB: Takeaways for marketers from SXSW 2023

SXSW has wrapped up in Austin, TX following 10 days of technology, film, comedy and music-centered events.

Advertising attendees said the conference felt more vibrant and dynamic than prior years, as people return to in-person events after the pandemic. The festival is expected to have drawn in 300,000 attendees across its full breadth of programming — slightly higher than the approximately 277,000 who descended on Austin in 2022.

“It’s the first year in a handful of years that it feels like the festival is back,” said Maria D'Amato, ECD of GSD&M.

It also reflected a workforce that is more focused on solutions and ROI than excess. Headline sessions from speakers such as OpenAI cofounder Greg Brockman drew long lines and audiences asked thoughtful questions during Q&A sessions.

“It really feels like SXSW of old, where there’s been a lot more focus on the talks, conversations and panels and less about what party can I get into tonight,” said Wilson Standish, head of content and creativity at Hearts & Science.

“A lot of the conversation this year is about the builders that have actually done the work to deliver beyond the tip of the iceberg initial experimentation,” said Sosti Ropaitis, EVP and head of Web3 Advisory Practice at MediaLink.

@campaignus Three agency leaders take us on a tour of key trends to emerge from #sxsw 2023 #creativity #advertising #technology ♬ Lo-fi hip hop - NAO-K

The brands that usually have a major presence at SXSW, including Google, Meta, Snap, TikTok and Twitter, were expectedly quiet as they navigate revenue headwinds, ongoing layoffs and political challenges. 

In their place, entertainment brands including Amazon Prime Video, Audible, HBO Max, Hulu and Paramount filled Austin’s venues.

“I think the entertainment world is really where innovation is happening,” said D'Amato.

Campaign US was on the ground covering advertising and technology tracks and brand activations, from which several common themes have emerged.

Artificial intelligence: Approach with caution

Artificial intelligence dominated conference programming amidst the explosion of ChatGPT, with many sessions focused on how it will affect specific industries such as art, music, journalism and healthcare.

“[With AI] I feel like we are at that peak of the hype cycle,” said Hearts & Science’s Standish.

There was a mixture of excitement and caution about the power of AI. Companies excitedly showcased how AI is transforming their work and helping to combat challenges like climate change, while scientists and academics tackled ethical issues such as copyright, deep fakes and bias.

“I’m hearing a lot of very intentional language that you don’t always hear about the hot topic of SXSW,” said GSD&M’s D’Amato. “When it was metaverse, no one was curtailing their language at all. With AI people are being more careful, they are considering what the problems of it are — even if we’re not hearing a lot of the details on how they are going to solve those problems.”

The ad community is particularly concerned about intellectual property in generative AI as more artists bring forward lawsuits. 

“A lot of the conversations that I’ve been attending are about the ethics of ownership and attribution, and also the bias that goes into who is monitoring [the technology],” said Standish.

“From the advertising perspective, that’s a really big consideration for how we utilize tools like Midjourney and DALL-E,” added D’Amato.

Metaverse hype dies down, but underlying tech remains on show

Discussions about the metaverse and Web3, which were popular at last year’s SXSW, evolved from visionary concepts into practical showcases of its underlying technology.

Activations offered to turn attendees into holograms, demo games or attend a concert in VR, while sessions showcased how VR is being used as a medical treatment and to aid sustainability projects.

“We saw a lot of the experimentation last year which was the first foray of NFT projects, tokenization. This year is very much about, what does this mean for my day-to-day? How should I be thinking about the space in terms of investment, participation and what does that mean for my long-term roadmap?” said Ropaitis.

In adland the metaverse excitement “has burned off a little bit,” said Standish, but the “hard work is being done in the back end in things that maybe aren’t as sexy,” such as virtual and physical identity matching for customer loyalty. 

@campaignus Creative and innovation leaders from @gsdm.agency, Hearts & Science, MediaLink and @nokia share how metaverse and Web3 content, which dominated #sxsw last year, has shifted #metaverse #web3 #advertising ♬ Lo-fi hip hop - NAO-K

Purpose and sustainability take center stage, but diversity backpedals

Brands took stronger stances in their conference sessions and activations.

Lush stepped up its fight against big tech, Ben & Jerry’s protested the ad industry’s work with fossil fuel clients, Chobani sought to prove that purpose and profit can be happy bedfellows and HBO Max showcased how it infuses the LGBTQ+ perspective throughout its programming.

Meanwhile, agency leaders said brands are increasingly considering the emissions impact of technology investments given the computing power required to power AI and Web3 programs.

“A ChatGPT query takes seven times more energy than a Google search, and so as we use more of this AI and machine learning, there’s an energy crisis to address as well,” said Standish.

Around the festival, musicians rallied for fair pay.

Yet discussions about diversity and human rights backpedaled and few businesses were keen to address SXSW’s roots in Texas, a state which drew boycotts last year  for rolling back women’s and LGBTQ+ rights.

A large proportion of LGBTQ+-focused programming concentrated on protecting fundamental rights to education, marriage, medical care and the military.

There was one session on the data privacy implications of Roe v Wade’s reversal, but it was programmed at the end of the day and drew a smaller crowd than SXSW’s headline sessions.

Kate Wolff, founder and CEO of Lupine Creative, said layoffs across the tech industry are affecting DE&I leaders and budgets, which risks reversing progress made over the past few years.

@campaignus The co-founders of Do the WeRQ, which is aiming to increase LGBTQ+ representation in advertising, discuss how SXSW programming focused more on survival than queer joy #lgbtq #sxsw #advertising ♬ Lo-fi hip hop - NAO-K

Silicon Valley Bank

As SXSW was kicking off, Silicon Valley Bank was collapsing, striking an ominous tone in the first weekend of the conference.

On panels, tech leaders expressed fears about paying their staff and losing venture capital (VC) funding. Some startups and VCs who were planning to attend the full week of programming were rumored to be swiftly rushing home.

The news “loomed large” in the first few days of SXSW, said Standish, but conversations dissipated as the government quickly stepped in to help.

“The conversation seems to be happening on the internet more so than on the ground,” said Standish.