WFA finds copyright and IP issues are stalling GenAI in marketing

Concerns over copyright and intellectual property (IP) issues are preventing brands from fully embracing the potential of generative AI (GenAI) in marketing, according to new research by the World Federation of Advertisers (WFA). Its report highlights the key risks and offers practical steps for advertisers to mitigate them.

Titled "Managing IP Risk When Using Generative AI in Marketing," the report finds that many of the risks stem from the inappropriate use of AI tools. However, with the right safeguards, brands can reduce their exposure and still benefit from the technology.

The research draws on insights from a 10-member steering board and IP experts within WFA member companies. The steering board includes representatives from AXA, Diageo, Essity, IKEA, Infosys, Kraft Heinz, Lego, L’Oréal, Mars, and Teva Pharmaceuticals.

They have identified six primary risks associated with GenAI in marketing, including loss of control over brand IP and data, breaches of third-party rights, unintentional copyright infringements, lack of ownership over AI-generated content, fraudulent AI-generated ads, and impersonation via organic AI-generated content.

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One of the biggest concerns is that inputting proprietary data into GenAI tools could make it accessible to a wider audience, including competitors. Similarly, using third-party data without permission could put brands in breach of contracts. There is also the risk of AI-generated outputs inadvertently copying existing trademarks or copyrighted works, exposing brands to legal disputes. Additionally, fraudulent ads and deepfake-style content can harm brand reputation by misleading consumers.

These concerns are not just theoretical. A WFA study from September 2024 found that 66% of brands see legal risks as the biggest barrier to GenAI adoption, with 77% specifically worried about IP and copyright issues. As a result, only 40% of brands currently using GenAI apply it to user-facing marketing communications.

"Addressing GenAI's legal risks is a top priority for brands," said WFA CEO Stephan Loerke (pictured). "This report comes at a crucial time, providing brands with a clearer understanding of the IP challenges they face when using GenAI in marketing and actionable insights on how they could tackle them."

To mitigate these risks, the report outlines three broad strategies for marketers. First, companies should establish clear policies and training to ensure employees understand the legal implications of GenAI. Second, they should manage contracts with AI providers, agencies, and partners to ensure compliance. Finally, implementing monitoring systems can help track AI usage and identify potential IP violations.

"Our goal is to empower marketers to unlock the technology's potential as part of our steadfast commitment to providing members with the knowledge and voluntary best practice they need to protect their brands and drive more effective and efficient marketing," added Loerke.

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