Beyond First Order Effects: AI and Cultural Change.
Beyond the Initial Effects of AI: Understanding AI's Impact on the Cultural Economy.
The Second-Order Effects of AI
When new technology emerges, the immediate focus is often on its first-order effects, such as job displacement or productivity gains. This perspective, however, is limited. A more complete analysis requires an understanding of second-order effects, the ripple effects that emerge over time. These are often driven by feedback loops, where an initial change leads to subsequent, sometimes unintended, consequences. For marketers, understanding these effects is crucial for adapting to the coming shifts in brand strategy and cultural norms.
This concept is analogous to the phenomenon of induced demand in highway construction. The addition of new lanes, intended to ease traffic, paradoxically encourages more people to drive, ultimately leading to greater congestion.
This same mechanic applies to taste and culture. The rise and fall of the "Instagram Face" aesthetic provides a relevant example. As the cost of cosmetic procedures decreased, the value of this look diminished as it became more accessible to the middle class.
As a result, many celebrities began to reverse these procedures, favoring a look that, while not necessarily natural, was more distinctive. This shows that as the price of fabrication falls, the value of veracity and originality rises.
The Cultural Devaluation of Abundance
In culture, scarcity creates value. This is evident in the desirability of luxury goods with long waitlists, the high resale value of rare sneakers, and the enduring appeal of a debut album. Generative AI is a tool of abundance, making visual art and design creation easier and cheaper. This will inevitably lead to a decline in the market value of skills that were once in high demand, such as 3D modeling and photo manipulation.
Beyond this, a broader aesthetic shift is inevitable. As generative AI converges on a homogeneous aesthetic, this output will devalue itself. The polished, generic renders of AI will fall out of fashion, as trend cycles demonstrate that a widespread aesthetic eventually loses its appeal.
When the cost of producing a work drops to zero, its value becomes less about technical mastery and more about how attention-grabbing it is. This forces brands to shift their focus. A hypothetical marketing dystopia illustrates this point: as generative engines lower the cost of producing marketing messages, a "tragedy of the commons" will ensue.
Our inboxes would be flooded with an unmanageable volume of AI-generated content. It is logical to conclude that we would turn to AI to filter these messages, creating a scenario where AI-generated content is read by AI, and humans communicate in a condensed, "bot-like" manner.
While first-mover brands may see a short-term advantage, the long-term result will be the devaluation of the entire channel.
The Future of Brand Value
The chaotic nature of second-order effects makes precise prediction difficult. However, one conclusion is clear: brands that focus solely on the productivity gains and cost savings of AI automation are missing the larger picture. The real losers will not be the workers whose skills are made redundant, but the brands that fail to adapt to the cultural changes that follow.
Marketers must anticipate the cultural devaluations that will accompany AI-driven abundance. The value of output will no longer be tied to the cost of its creation. Instead, it will be tied to its authenticity, originality, and ability to capture attention in a saturated environment.
A brand's ability to thrive will depend on its capacity to read the aesthetic shift and evolve to what will likely be a significant change in cultural norms and preferences.
Bottom Line
The primary impact of AI will not be on jobs, but on culture.
Brands must look beyond the immediate cost savings and focus on how to maintain value in a world where technical creation becomes cheap and authenticity becomes the ultimate scarce resource.
