Why Marketing Platforms Are Converging Into Expensive Mediocrity – News Round Up: 10/03-10/10

by Jeff Licciardi

The Great Platform Convergence: Why Every Ad Tech Tool Now Does Everything Badly – News Round Up: 10/03-10/10

There’s a peculiar phenomenon happening across advertising technology: every platform is morphing into the same bloated, AI-powered, full-funnel, retail-media-enabled behemoth. Google wants to be a retail network. Retail networks want to be streaming platforms. Social platforms want to be search engines. And they’re all racing to bolt on AI features that nobody asked for.

The result? A landscape of expensive mediocrity where specialized excellence has been sacrificed at the altar of “platform completeness.” This week’s industry news reveals the cracks in this convergence strategy—and why marketers are starting to notice they’re paying premium prices for increasingly average capabilities.

AI Everywhere, Value Nowhere

Let’s start with the AI gold rush, which has officially entered its “add AI to everything” phase. According to Digiday’s latest research, marketers are warming to AI—but creative challenges and legal risks still dominate the conversation. Translation: everyone’s adding AI features because they have to, not because they’ve figured out how to make them actually useful.

The pattern is unmistakable. Elon Musk is outlining an AI-led Grok future for advertising on X, while OpenAI has gone from hating advertising to building an entire advertising business. Even Google is rolling out AI Mode for ads, because apparently regular search advertising wasn’t complicated enough.

Here’s the uncomfortable truth: most of these AI features solve problems that platforms created themselves. Ad targeting got worse after privacy changes? AI will fix it! Creative production is expensive? AI will fix it! Attribution is broken? You guessed it—AI will fix it! Except it doesn’t, really. It just adds another layer of opacity and cost while making everyone dependent on black-box algorithms they can’t audit or control.

Retail Media’s Maturity Crisis

Speaking of convergence, retail media networks are experiencing their own identity crisis. After years of explosive growth fueled by “easy dollars” from endemic brands, the sector is facing what Digiday calls its maturity phase—and it’s not going well.

The problem is obvious: every retailer with a customer database decided they’re now a media company. As industry insiders warn, there’s a point of diminishing returns, and retail media’s reckoning is on the horizon. You can’t have 300 retail media networks all claiming to offer “unique first-party data” and “unmatched purchase intent signals.” It’s mathematically and strategically absurd.

The pivot? Everyone’s suddenly “full-funnel.” Retail media’s mid-2025 reality shows advertisers going all-in on full-funnel capabilities, which is consultant-speak for “we realized we can’t just be a point-of-sale advertising vehicle.” Meanwhile, smaller retail media networks are desperately trying to differentiate from Amazon and Walmart—mostly by offering the exact same capabilities at slightly different price points.

Even more telling, retail media networks are now pivoting to compete with ChatGPT, because apparently being a retail advertising platform wasn’t enough. Now they need to be AI-powered shopping assistants too. This is convergence thinking at its most desperate.

CTV’s Growth Masks Commodification

Connected TV is the one bright spot everyone points to, and for good reason. AdExchanger reports that CTV will keep growing in 2025, with Q3 earnings showing robust advertiser demand. Political advertising alone saw CTV impressions triple in October versus September.

But here’s what the growth numbers obscure: CTV is rapidly becoming as fragmented and complex as digital advertising was in 2010. Every streaming service has its own ad platform. Every ad platform has its own measurement standards. Every measurement provider has its own definition of “viewability.” The promise was TV’s simplicity with digital’s targeting. The reality is digital’s complexity with TV’s cost structure.

The Real Cost of Platform Convergence

When platforms converge on the same feature set, competition shifts from “who does this best” to “who bundles everything together most aggressively.” That’s great for platform revenue—you can charge more for an “integrated solution”—but terrible for actual marketing effectiveness.

Specialized tools that did one thing exceptionally well are being replaced by platforms that do twenty things adequately. The switching costs are high enough that marketers stay even when performance degrades. And because everyone’s using the same playbook, differentiation becomes nearly impossible.

This is why agencies are struggling to find real AI ROI and why Facebook is losing its groove. When your strategy is “add every feature our competitors have,” you end up with bloated platforms that serve shareholders better than they serve advertisers.

What Comes Next

The convergence era will eventually hit a wall. Marketers will tire of paying premium prices for mediocre, bundled capabilities. A new generation of specialized tools will emerge—likely AI-native, but focused on solving specific problems exceptionally well rather than everything adequately.

The platforms that win long-term won’t be the ones with the longest feature lists. They’ll be the ones that remember why they were valuable in the first place and resist the urge to become everything to everyone. Specialty will beat sprawl. Focus will beat features.

Until then, welcome to the age of expensive mediocrity. Your “unified platform solution” will be ready shortly, complete with AI features you didn’t ask for and integration complexity you definitely didn’t want.

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