Coca-Cola’s latest holiday commercials, developed using the most advanced AI video-generating models, may be evidence the technology is capable of turning out TV-quality ads. And the fact that they came from such a major brand is starting to reverberate through ad land.

“To date, this is the most impressive gen-AI commercial I have seen,” said Mathias “Maty” Ramos Sr., art director at Gravity Global. “Although we have not achieved anything close to perfection, this is a huge step in the right direction for artificial intelligence, and they are setting the stage for others to follow and showing what is truly possible. I admire the approach of not pushing for perfection since the technology isn’t quite there yet but really testing the boundaries of what the future of advertising will look like.”

Reactions from the creative community, so far, have been a familiar mixture of dread, with some lamenting AI artistry as “soulless,” while others compliment the technological achievement Coke’s ads represent.

Below, a look at the Coca-Cola commercials produced by Secret Level, Silverside and The Wild Card, in that order:

On Thursday, Coca-Cola shared the three new commercials for the first time with Ad Age—AI-generated versions of the brand’s classic “Holidays Are Coming” commercial from 1995. The original spot (below) showed a convoy of Christmas-lighted Coca-Cola trucks traversing wintry climes to reach a small town for the holidays. Coca-Cola tapped three studios—Secret Level, Silverside AI and The Wild Card—to make the new ads using the latest AI video-generation models, including Leonardo, Luma and Runway. The commercials share similar themes with the original, big red trucks, snowy scenery and quaint, holiday-decorated towns, and are undoubtedly technological achievements, with Coca-Cola perhaps being the largest brand to build a TV ad campaign with AI.

Below, a look at the original commercial:

But creative clap-back has surfaced with now-common criticisms about the look and feel of AI. “Lifeless,” “soulless,” “creepy” and “dystopian,” were just some of the words in the comments of one Instagram post about the Secret Level version of the ad. It is important to note that these have become predictable refrains from online chatter almost every time a new piece of AI marketing content gets posted. There have also been snarky retorts about Coca-Cola's use of its popular tagline “Real Magic” appearing alongside its AI marketing.

There are also champions of AI, who vouch for its ability to unlock creativity, impressed with what Coke made. “It’s interesting how AI allows us to remix something so nostalgic,” said Craig Elimeliah, chief creative officer, Code and Theory. “This shows us that AI is not replacing anything … It’s about the creative process having more room to breathe and evolve.”

“We are still telling stories but with a new palette and endless possibilities,” Elimeliah said. “That’s where the magic is."

As for a snap gauge of everyday consumer sentiment: System1 Group, which tracks consumer attitudes around ads, ran Secret Level’s commercial through an analysis and found it scored as high, if not higher with audiences, compared to the original ad. “It’s the highest going Christmas ad we’ve seen” this year, said Andrew Tindall, senior VP of global partnerships at System1, referring to the star-rating the ad received when the firm put the commercial through its sentiment analysis. Secret Level’s spot got a 5.9 score, the highest score, which signifies the top predictor of maintaining “long-term market share growth,” according to System1’s scoring. System1 shows the commercial to at least 150 people and tracks the emotional resonance—from disgust to happiness to surprise.

“What it’s based on is how the ad leaves real human people feeling,” Tindall said. “So, if you leave people feeling more positive and intensely positive, and not neutral or negative, and you get a higher star rating, it’s basically how you know how much consumers love that piece of advertising.”

System1 was just an early indicator of how the commercials are faring with viewers. The firm also intentionally did not alert viewers to the fact that AI was used in the making of the ads, which could have unduly swayed sentiments if audiences were primed with that information, Tindall said. The commercials themselves do have asterisks noting in fine print they were “created by real magic AI” at the end of each spot.

Also read: The best holiday ads of 2024

At Ad Age’s request, another ad testing company, Daivid, put the new spots—as well as the original “Holidays Are Coming” spot—through its own testing process to compare the results. The new executions scored well for attention in the first second and brand recall, but were let down by their relative failure to evoke intense positive emotions, which were all below the industry norm, Daivid said.

The difference between the AI spots and the original was most stark in their evocation of warmth, a mainstay of Christmas advertising. The original spot evoked intense warmth among 33.0% of viewers, whereas the AI versions were significantly below this (Silverside, 23.9%; The Wild Card, 21.1%; Secret Level, 18.7%). 

“While the AI is producing images which on the face of it seem cute and heartwarming, the human viewer to some degree discerns their synthetic nature, which detracts from their impact,” said Daivid’s CEO, Ian Forrester.

AI in the mainstream

Coca-Cola was not immediately available to respond to comments about the reception of the ads, but last week, Pratik Thakar, Coca-Cola’s VP and global head of generative AI, talked with Ad Age about how the commercials were produced. Meanwhile, Jason Zada, founder of Secret Level, spoke at Ad Age’s Emerging Tech Summit during a workshop about whether video AI is getting to the point of being able to handle TV commercials. Despite some opinions circulating online, AI ads are clearly ready for airing in living rooms and beyond. “It will be on social, in cinema halls, TV channels,” Thakar told Ad Age. “We will be reusing it as our mainstream content across different channels.”

Coca-Cola’s AI endorsement is a major leap for a brand that spent $5 billion on worldwide ad spend in 2023, an all-time high, which was up 16% from $4.3 billion in 2022, according to Ad Age Datacenter.

Exclusive for Ad Age All Access subscribers: Inside Coca-Cola’s ad spending and marketing spending

Coca-Cola worked with the three AI studios to get variations of the commercials, each with their own flair that make them customized for different regions for this global campaign, according to Thakar. They all are reminiscent of the original, with parades of Coca-Cola trucks traversing different scenery.

Deciding to use video AI for the production presented the brand with more options, including being able to produce three ads within a tighter timeframe than usual, Thakar said. Also, they were able to show varied settings and create more lifelike animals. All the commercials have the Coca-Cola polar bears but Secret Level’s ad showed squirrels, Silverside’s ads had puffins and The Wild Card’s ad had macaque monkeys. Secret Level’s ad was the only one that showed closeups of people. And they all have glimpses of Santa without showing his face, similar to the original, which also did not have a Santa actor in 1995. Keen AI watchers could notice in Secret Level’s commercial the ending that gets a closeup of Santa’s hand reaching for a Coke, and as a sign of the evolution of AI, the hand had five well-manicured, chubby fingers. Early AI imagery was famous for messing up hands, often adding extra digits and even limbs.

Coca-Cola used real actors’ likenesses for the Secret Level ad, getting permission to use them in AI form, Thakar said. Also, the soundtrack is still real musicians and singers performing the holiday anthem that chugs along throughout the spots.

Coca-Cola has been investing heavily into AI in its marketing. For instance, it worked extensively with Microsoft, OpenAI, Accenture, Leonardo.ai for AI images and video, and Mimic, which helps create 3D digital twins. This week, Coca-Cola launched an AI twin of Santa Claus on its “Create Real Magic” website, a platform that allows consumers to talk to the virtual jolly old elf to share holiday memories and then create AI-generated images based on those memories. Coca-Cola launched the site last year as a tool for people to make holiday images sans Santa’s digital twin.

All this work is possible thanks to Coca-Cola training AI on its history of data and marketing material, including the early illustrations of Santa Clause from artist Haddon Sundblom.

“The Sundblom Santa from 1931, which we created, people never saw him in a dynamic version, so this was the first time” it’s come to life in this way, Thakar said. “It was always a static painting or image.”

Balancing humanity and tech

The brand is trying to be careful with how it deploys AI in its marketing; for instance, there are guardrails about the kinds of topics the AI version of Santa will discuss, and there are age-gates to enter, Thakar said. And the brand is fully aware of the sensitivities around AI being used to create marketing material, according to Thakar. In the case of the holiday commercials, video AI made sense, because the technology is proficient with “hyper-realism,” a style that doesn’t require 100% real-life fidelity, Thakar said.

“AI is always good at creating fantastical, hyper-realistic stories, and that's where the whole imagination went into next level [with the commercials], because AI does that very well,” Thakar said. “If I want to go very realistic, maybe it's difficult, but if I want to go hyper-realistic and fantastical, AI is actually a much better tool.”

“We wanted to use AI, not just for the sake of using AI,” Thakar said, “but to use AI where its strengths lie. Also, at the same time, we wanted to make sure that the humanity and originality and craftsmanship is there.”

The new commercials now enter a field of AI-generated video productions that have at times polarized the creative community. In March, Under Armour ignited a creative tug-of-war between AI supporters and its doubters, with a commercial directed by Wes Walker and starring boxer Anthony Joshua. In the infancy of AI image- and video-generation, the technology was widely panned for creating hallucinations and producing uncanny content. Coca-Cola’s commercials have led to some similarly negative reactions.

“There will come a time when AI can be used to create magical TV ads, but that time clearly isn’t now,” said Tor Lemhag, executive creative director, Dunn&Co. “Watching these, I’m trying to decipher why I feel nothing.

“Is it because things go from picture perfect one moment to downright weird the next,” Lemhag said. “Perhaps it’s because the people, while sometimes looking quite real, are not, and our brains know that. Or is it simply that everything tries to be louder than everything else and nothing stands out. Perhaps it’s all of the above, but the magic is anything but real: It’s dead.”

PJ Pereira, creative chairman at agency Pereira O'Dell and founder of Silverside AI, which produced one of the three AI ads, discussed the process in a LinkedIn post on Thursday.

“It was summer when we first pitched the business, too much time for things to go wrong, for people to change their minds, for the technology to take giant leaps that would render the work too old,” Pereira said. “Yet, more than 10,000 frames rendered, 5,000 video segments and 100+ final assets delivered (including custom spots for lots of different markets), here we are.”