Debunking the Myth: AI Isn’t Destroying Marketing—Stock Buybacks Are the Hidden Culprit
Introduction
Amidst the buzz surrounding Artificial Intelligence in marketing, many industry observers believe that AI is primarily responsible for job losses and creative stagnation. Headlines often highlight how AI tools threaten to replace human ingenuity, transforming marketers into mere prompt engineers. However, a closer examination suggests that the real forces undermining the marketing industry run deeper—specifically, the rampant practice of stock buybacks orchestrated by corporate executives. This article delves into why stock buybacks, rather than AI, are quietly draining essential resources from marketing, innovation, and long-term growth.
The AI Narrative: Overhyped and Misunderstood
It’s undeniable that AI has made significant inroads into marketing functions. Automating routine tasks like copy generation, ad tweaking, and data summarization can boost efficiency. Yet, AI’s limitations are equally evident. Creative strategy, holistic messaging, and emotional connection—core elements that define compelling marketing—remain elusive for even the most advanced algorithms. AI struggles with originality, deep strategic thinking, and understanding the nuances of human experience. Therefore, the narrative that AI is devastating marketing employment and innovation oversimplifies the complex challenges our industry faces.
The Underlying Issue: Corporate Incentives Fueling Stock Buybacks
While AI’s role may be overstated, a more insidious problem persists beneath the surface. Many corporations are prioritizing short-term stock price enhancement over sustainable growth—primarily through stock buyback programs. These buybacks involve companies repurchasing their own shares from the market, effectively reducing the total number of outstanding shares. The immediate consequence? An artificial boost in earnings per share (EPS), which positively influences stock prices and rewards shareholders.
This practice isn’t accidental; it’s a deliberate strategy favored by corporate leadership to satisfy executive bonuses, secure investor confidence, and inflate perceived company value. Instead of channeling profits into research and development, marketing campaigns, employee development, or product innovation—investments that could foster genuine growth—companies divert massive sums into buybacks.
The Financial Engineering Behind Buybacks
The history of stock buybacks reveals a shift from value-driven corporate growth to financial engineering. Following the SEC’s approval of buybacks in 1982, the practice gained momentum as an “easy fix” to boost stock prices without altering fundamental business operations. Trillions of dollars have flowed into buybacks, especially after the 2017 tax
