Podcast Summary: Always Be Testing #86 – Beyond Best Practices: First-Principle Thinking in Performance Marketing with Svet Kazanjiev

Release Date: May 27, 2025

Introduction to Svet Kazanjiev

In Episode #86 of the Always Be Testing podcast, host Tye DeGrange welcomes Svet Kazanjiev, Principal at Blue Services, to delve deep into the realms of growth, performance marketing, and the intricate dynamics of digital advertising. Svet brings over two decades of experience in performance marketing, having traversed esteemed institutions like Stanford and McKinsey, and pioneering roles at companies like Nextag. His journey from the structured environments of academia and consulting to the high-octane world of online marketing provides a unique perspective on the industry's evolution.

Notable Quote:

“One of the big things I absolutely love about online marketing is the measurability and objectivity of this field… I enjoy the cat and mouse game between advertisers and platforms.”
— Svet Kazanjiev [00:50]

First-Principles Thinking in Performance Marketing

Svet emphasizes the importance of first-principles thinking, advocating for a foundational approach that challenges conventional wisdom. He illustrates this by discussing the rise of automation and AI in marketing, highlighting that merely adhering to best practices without understanding the underlying mechanics can lead to suboptimal performance. Svet draws parallels with DeepSeq's AI innovations, emphasizing the necessity of delving deep into algorithmic intricacies to achieve competitive advantages.

Notable Quotes:

“You need to really understand how these algorithms work… you need to go low level.”
— Svet Kazanjiev [07:50]

“Think like engineers. We need to think algorithmically in order to thrive in this algorithmic environment.”
— Svet Kazanjiev [09:08]

Differences Between Consumer (E-commerce) and B2B Marketing

The conversation shifts to dissecting the distinct strategies required for e-commerce versus B2B marketing. Svet outlines three pivotal elements for effective e-commerce performance: profitable growth, excelling in the comparison shopping experience, and mastering data utilization. In contrast, B2B marketing demands meticulous setup, robust lead scoring systems, and sophisticated feedback loops to align marketing efforts with sales objectives.

Notable Quote:

“For B2B businesses, having the right instrumentation and variables inputting into your model and then having the right feedback loops to optimize those.”
— Svet Kazanjiev [14:52]

Common Misconceptions in Paid Search

Svet addresses prevalent myths in paid search, cautioning against blindly following so-called best practices. He cites the misconception surrounding AI-driven optimization campaigns, where marketers are advised to wait a specific duration before tweaking campaigns. Svet argues that real-world performance should dictate actions, advocating for agility over rigid adherence to guidelines.

Notable Quote:

“If after three or four days it looks like you're losing your shirt on this setup… you should be cutting your losses.”
— Svet Kazanjiev [17:14]

The Role of AI and Automation in Marketing

Exploring the intersection of AI and marketing, Svet distinguishes between large language models (LLMs) like ChatGPT and other sophisticated AI applications such as reinforcement learning and transformer models. He predicts a convergence of these technologies, especially as Google evolves into a more advanced answering engine, blending content generation with optimized advertising strategies.

Notable Quote:

“There is so much stuff going on… the two worlds are going to merge because the LLM generated content in the answer is going to be the one that will be driving the ads.”
— Svet Kazanjiev [29:44]

SEO and the Case for Bing

Highlighting the enduring significance of SEO, Svet advocates for incorporating Bing into search strategies. Contrary to the dominant focus on Google, Bing offers competitive cost-per-click rates and serves as an excellent testing ground for SEO strategies. Additionally, Bing's integration with LinkedIn targeting presents unique opportunities for B2B marketers seeking refined audience segmentation.

Notable Quote:

“Bing integrates LinkedIn targeting with search functionality at very affordable CPCs and that can be very, very powerful and unique.”
— Svet Kazanjiev [32:09]

Future of Marketing with AI Search

Looking ahead, Svet expresses excitement about the transformative wave of AI in search. While acknowledging the challenges, especially for those solely reliant on SEO, he is optimistic about the opportunities that AI-driven changes will bring to paid search and advertising. He anticipates significant transformations as Google adapts to the evolving landscape, presenting fresh avenues for innovative marketers.

Notable Quote:

“Paid search, paid advertising is not going away. This is what Google does… when that transformation happens, it will be very exciting for a good marketer.”
— Svet Kazanjiev [34:13]

Advice for Marketing Leaders

Svet offers pragmatic advice for today's marketing leaders: immerse oneself in AI tools, study AI models, and engage with cutting-edge research. He stresses that superficial interactions with AI, such as using basic interfaces like ChatGPT, are insufficient. A deep, technical understanding is imperative to navigate and capitalize on the impending AI-driven transformations in marketing.

Notable Quote:

“We should use AI tools every day, read about AI models, study AI experiments, read research papers… we need to really understand these technologies.”
— Svet Kazanjiev [36:05]

Recommended Readings

To further grasp the complexities of AI and its applications in marketing, Svet recommends Peter Norvig's AI textbook. He praises the book for its depth and instructional quality, likening it to the renowned Feynman lectures in physics, which profoundly influenced him during his formative years.

Notable Quote:

“Peter Norvig's AI textbook is absolutely awesome… it reminds me of the Feynman lectures in physics.”
— Svet Kazanjiev [37:14]

Conclusion

Episode #86 of Always Be Testing provides an insightful exploration into the nuanced world of performance marketing through Svet Kazanjiev's seasoned lens. From dissecting foundational strategies to anticipating future AI-driven changes, Svet underscores the imperative of deep technical understanding and adaptability. His emphasis on first-principles thinking serves as a clarion call for marketers to transcend conventional practices and embrace a more analytical, innovative approach to drive sustained growth and performance.

Connect with Svet Kazanjiev

For more insights and to follow Svet's expertise in performance marketing, connect with him on LinkedIn.