Build or buy: Inside indie agency Mod Op’s AI infrastructure

In a strategic move to enhance its operational efficiency and reduce costs, independent marketing agency Mod Op has developed its own AI infrastructure, named Orion. This initiative has reportedly allowed the agency to avoid approximately $3 million in licensing fees that would have been incurred by utilizing commercial AI tools such as Microsoft Copilot or Figma Weave. Tessa Burg, the agency's chief technology officer, highlighted that this decision was driven not only by financial considerations but also by the desire to maintain control over data and the client experience.

The Development of Orion

Mod Op's journey towards creating Orion began just before the launch of ChatGPT in late 2022. The agency quickly rolled out an internal version based on multiple large language models (LLMs), which are advanced AI systems capable of understanding and generating human-like text. By the end of last year, Mod Op introduced a client-facing layer of Orion, with plans to incorporate generative engine optimization (GEO) in the near future.

Orion functions as an operational layer that connects the APIs of major LLMs, facilitating tasks such as report generation and concept testing for both clients and internal teams. Some of its most utilized features include an agent that manages contractors and external creative resources, another that prioritizes tasks based on email content, and one that assists in creating presentations. Burg described Orion as a “managed program,” which combines licensed tools with proprietary software into a cohesive platform, thereby granting Mod Op greater control over user experience and data management.

Cost Savings and Productivity Gains

The financial implications of Orion are significant. While the agency has saved on licensing fees, the true return on investment (ROI) is reflected in productivity improvements. Burg noted that processes such as client discovery, event resourcing, and strategy development have been streamlined from a timeline of 20 to 30 days down to just one week. Additionally, reporting and analytics tasks, which previously took weeks to complete, can now be executed in real-time.

Internally, Mod Op is closely monitoring various metrics, including the speed of insight production, effective hourly rates, output per deliverable, and user adoption rates. Although most of Orion's applications are for internal use, the agency is also working to help clients understand the capabilities and outputs of the system. Interestingly, no client has yet requested individual logins to access Orion, indicating a cautious approach towards AI adoption in the industry.

Challenges in Client Adoption

Convincing clients of the value of AI remains a challenge for Mod Op. Discussions at the recent Cannes Lions festival revealed a growing gap between the capabilities of AI tools and the readiness of clients to embrace them. Burg acknowledged that clients are eager to engage with data, emphasizing that this is a critical phase in the journey towards full AI integration.

The broader context of AI adoption in the marketing industry is complex. A recent McKinsey study indicated that a staggering 93% of enterprise leaders exceeded their AI budgets, with one-fifth of respondents reporting that their organizations had limited AI usage due to associated costs. This scenario underscores the delicate balance agencies must strike between investing in AI development and realizing tangible business benefits.

As Mod Op continues to refine its AI infrastructure, it is betting that owning this operational framework will provide a competitive edge in the long run. Burg expressed confidence that having a proprietary platform will be a significant differentiator for the agency, even as they acknowledge the impracticality of building every tool from scratch.

In an environment where Big Tech continues to dominate digital growth, agencies like Mod Op are exploring innovative solutions to navigate the challenges posed by AI integration. While brands are investing in tools to assess their visibility within LLM outputs and AI search, the commercial impact of GEO strategies remains difficult to quantify. As the marketing landscape evolves, Mod Op's Orion may serve as a case study for other agencies contemplating the build-or-buy dilemma in AI infrastructure development.