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Episode 166: Alicia Richardson, Winner of the Marketecture Start-up Showcase, on Experiential Marketing and Whether Cannes Is Worth it
00:54:36
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- [00:01]
A
This is a paid ad from our friends at Vibe. If you're running performance marketing at scale and still treating CTV as an awareness only channel, you're leaving money on the table. Vibe Co is the most advanced streaming TV ad platform built specifically for performance teams, giving you the same self service, control, targeting, precision and real time optimization you get from Meta, but on the big screen. Right now, Vive is offering a 50% spend match up to $200,000. Head to Vibe Co and mention this podcast to claim the offer.
- [00:40]
B
This podcast is brought to you by audiohook, the leading independent audio dsp. Audio Hook has direct publisher integrations into all major podcast and streaming radio platforms, providing 40% more inventory than what could be accessed in omnichannel DSPs. What's more, audiobook has full transcripts on more than 90% of all podcast inventory. Enab enabling advanced contextual targeting and brand suitability. Audio Hook is so confident that in addition to CPM buys, they offer the industry's only pay for performance option where brands can scale audio and podcasting with peace of mind knowing they are only paying for outcomes. Visit audiohook.com to learn more. That's audiohook.com. Welcome to the Market Extra podcast. This is Ari Paparo. I'm here with Eric Franchi and we have a special guest today. We have Alethea Richardson, who is the co founder and managing partner of Crowd Access and she just became famous. We made her famous, I guess, which is she's the winner of the Market Live Startup showcase where her company won both the award for the judges and from the attendees. And I'm excited to have her on because we're going to talk about experiential, meaning like concerts, events, B2B. Can we all go to Cannes? Is it worth it? We don't know. So we're going to try to figure that out. Eric, what's your point of view on the company? Why did they win? I guess let's start there.
- [02:13]
C
Yes. So in MMA circles, when you have someone that is the winner of multiple categories, we got a name for it. It's Champ. Champ. So Alicia is the Champ Champ of Market. There were two things that stuck out. Number one, and I'm looking forward to people being able to see this. This was an awesome presentation. From the materials to Alicia's delivery to just, you know, getting everybody like really excited about a category they were not thinking about. It was just like a 10 out of 10. There was. It was an excellent presentation. And then number two, experiential is a big Market. I forget what she quoted in her presentation, but it was something like a hundred billion dollar market that has like zero measurement based on, you know, how we would expect things to work with digital. So it seems like just a greenfield opportunity. And she's a super strong founder. I've known Alicia, gosh, for the better part of maybe two decades, if not a decade and a half. She'll talk a little bit about how she got her start. It was, it was a unique beginning at my former company, Undertone. And she's just a force of nature and she's a great, great conversationalist. So she'll be fun.
- [03:18]
B
Yet another Undertone alumni. That is the way to get on the show. So we're, we're slowly but surely publishing record of Market Extra Live for those who weren't there or want to refer to them. So this past Monday, the Terry Quadra Bad Bunny presentation, Bad Banker came out on this podcast and on YouTube. The plan is we're going to put everything on YouTube and then we're going to drop some of our favorites here on this podcast on Mondays and then on the Ad Tech God podcast as well. I'm not sure which day of the week, but you should subscribe to that on your favorite podcast listener or subscribe to our YouTube channel. Any of that is acceptable. With that, let's dive in with Alicia Richardson from craf. Welcome Alicia Richardson, the co founder and managing partner of Crowd Access and now best known as the winner of the Market Live 3 startup showcase. The double winner, both crowd favorite and expert favorite. Thank you for being here.
- [04:15]
D
I'm excited to be here. Delighted.
- [04:17]
B
How's your life changed in the last two weeks, is it?
- [04:22]
D
It's changed greatly, as a matter of fact. I'm being noticed everywhere. I just can't stop talking to people. It's just it. Yeah, it has skyrocketed into something that I couldn't even imagine for myself.
- [04:36]
B
Oh my God.
- [04:37]
D
In all seriousness, it's been amazing. It's been really incredible. The feedback that we've gotten from that.
- [04:43]
B
Great, great to hear. And you did a great presentation. I think a lot of people were really interested because it's an area of marketing and advertising that's a little outside of the ordinary conversation. We're talking about experiential experiences. What. Give us a quick definition. What, what is experiential?
- [05:01]
D
Yeah, no, fair question. Experiential marketing is really any marketing that puts the brand in direct physical contact with the consumer. I think that's an easy sort of 30,000foot view or way of, of answering that. But some examples, think immersive experiences like what happens and can every, every year. Think about what you just did at marketecture, think about a trade show presentation, think about a brand own event pop up are included in Experiential.
- [05:30]
B
And Experiential works, right? Like it's, it's. We all invested it. Probably everyone who's listening to this podcast participates in some way in Experiential. But it's hard to measure correct, right.
- [05:43]
D
Like our gut tells us, I know this is working. It's sort of like this feeling of like momentum. Right. Like even at Market Tech. I'll stick with that as an example for this whole thing if that's, if that's fine. You feel an energy, right? You feel a vibe, you feel that people are taking it in. You feel that it's resonating. But how do you actually measure that where it makes sense going back to your board or going back to your CFO that they can then say, yeah, your vibes check out for the data that I actually need. Right, that this makes sense.
- [06:12]
B
We need an ROV return on Vibes. This was actually one of my, when I was recruiting for marketing people, I would always ask them, how would you calculate the ROI on attending can? And they pretty much never gave me a good answer. It was always just vibes. So how do companies, you know, it's not just obviously we have, you know, a soda brand might spend tens of millions, hundreds of millions advertising or sponsoring concerts. How do, what is the ROI calculation? Like, what is the state of the art on that?
- [06:44]
D
Yeah, I mean, by and large it's really been attendance numbers. I think if I take a step back for a second, it's been where Experiential has borrowed from digital before. Digital actually had its own metrics. It was borrowing from print and then it developed its own metrics about what makes sense specifically for that platform. Experiential is currently borrowing from digital where we'll look at impressions and attendance numbers and, you know, some sort of insight in terms of overall engagement. Some brands that are partnering with different third parties might even be able to pull in some attribution numbers. Net 30 Understanding of if I'm a retail brand, how many people bought after attending this event so that you have some hard figures that you can go back with. But there's no sort of central way of saying this is how you should be measuring this. Or better yet, what should I anticipate from this event if I come to marketecture versus going to can. What should the expectation be for me as a marketer, for what architecture will provide for me versus what can will provide for me? What's the status quo when it comes to that? And they're not at parity with each other, but how do we define that? And that's the piece that hasn't been done.
- [08:00]
B
So what is the. What's the recommendation? What are you pushing forward?
- [08:04]
D
Yeah. So while the recommendation is crowd access, okay, sure, essentially, I mean, that was a layup, so I had to take it. But the recommendation is really being able to standardize the ecosystem. When you think about what's happening across all other marketing channels, be it television. Television has Nielsen. Right. That helps to standardize that. Digital has comscore. And so there are unique standards across the board, in some instances more than one that you can go to that says here's what actually happened and that's what experiential needs. I think that being able to have just a standard within that marketing channel will help us understand what are the expectations going into this? And how do you actually measure every single event from an apples to apples comparison and not take out a new ruler every time?
- [08:51]
B
So what, what are the apples in this case? Is it attendance? Is it qualified attendance or something else?
- [08:57]
D
No, it's. It's actually far more deeper than that. Certainly reaches a part of it. Right. But that's table stakes, and I think that's what most people sort of lean into now because most marketers really hear about these events based on attendance numbers, based on how popular it is, and then they're like, okay, I definitely want to have a space here. But it goes way deeper than that. We have five different pillars that we look at that informs our experiential Power Index, which is a single metric that we look at for scoring all of the different events. So some of those elements, beyond attendance number, is market presence in terms of, like, what's the market value of this specific event? Right. Being able to look at historical performance. How has this done for brands in the past? Has it actually executed for them? What's the ROI that we've looked at? You know, things like infrastructure is also a part of it that is hugely important. As someone that has spent a lot of time within experiential, even on the event owner side, I know that when brands come in, you sell them something and then you're unable to execute what it is that you sold them, and that is, you know, that's always a disaster. So infrastructure is a huge part of it. And then logistics. How easy are you making all of this stuff for me? If I'm giving you this money and my team is coming in, how easy are you making this for me? So those are the things that we look at.
- [10:14]
B
So that's interesting. You have infrastructure and things like that. So I guess, like, the Fyre Festival wouldn't have done very well on crowd access.
- [10:21]
D
Sadly, no.
- [10:23]
B
And is there a difference between B2B and B2C? Obviously this is sort of a B2B podcast that we think can, but that's not the super bowl, so how do you think about that?
- [10:33]
D
So in terms of the way that we score, there's no difference. Right. Because all of those things still apply. It's just that the consumer looks very different in terms of who you're targeting. Right. But as far as the value of the event, the metrics still hold true, regardless of whether it's B2B or B2C or even, you know, a huge part of what we've been doing as well is measuring bespoke events. And I know we'll talk about that a little bit later for one of the questions, but looking at creating benchmarks against bespoke events that are cropping up far more from brands directly that are creating their own moments.
- [11:09]
B
Yeah, absolutely. So why don't you take us through, like, what the marketer's point of view. Maybe it's the CMO's point of view that they're doing their budget. You know, it's 2027's coming up and they. Do they have a line item for experiential, or is it just. Or do they just think about the opportunities and then back into how much they should spend on this? How do they figure out which events they should do, which they shouldn't? Obviously you would love it if all these decisions were just like using crowd access and. And, you know, just ranking them from top to bottom. But that's not really how it works just now. So get us in the mind of the marketer there.
- [11:42]
D
Yeah, absolutely. So today, what marketers tend to do is really go off of gut feelings and what they've been doing for years. Right. If it's a seasoned marketer, it's typically someone that has been operating within experiential for a while, and so they rinse and repeat. Oftentimes we, you know, it's not dissimilar to a certain extent. When you think about digital, where planning stages shrink, sometimes you're in a hurry, you're trying to get all of this stuff done. And so you go back to what you know, you're like, you know what, let's just continue to do this. Right. But most of the marketers only see 15 of the market. So they have no. There's millions of events that are out there. But some events have a smaller sales force, so they'll never be able to get in front of the marketers to really pitch for themselves. Others just don't really have the social presence of where you go viral. And it's just like, this is where I need to be. And so that's a lot of how marketers come into experiential. And then there's some test and learn, depending on what they see throughout the year. But that's largely what we see. It's really based off of gut instincts.
- [12:49]
B
And like, you know, a lot of marketers in B2C especially do their own events or they do, you know, custom activations, street teams going through cities and stuff like that. How, how in the world could you figure out what the ROI is going to be on? Like assembling a street team and going out and talking to people, you know, about your new soda or your new car?
- [13:10]
D
Yeah, I think a lot of that is really based upon create benchmarks that you get across the landscape. Right. So as far as being able to have some sort of insight into roi, the score is really there to give you a directional number. So it's constantly ingesting information so that it's course correcting along the way. And what I mean by that is, I can give you an example of. Here are the different types of activations that a retail brand has executed across B2B or B2C. Right. Whether it's a programming moment or a sampling moment or whatever that looks like. And I actually know what the benchmarks typically are in terms of the return that you get on that because I've seen it across enough retail or enough categories to be able to predict that or give you some directional number. It's not going to be a silver bullet where it's always 100% accurate, because I liken it to this and I'll take it back to digital because I know this is hugely the audience here. Right. Think about a publisher. And when you go on a publisher, that publisher is responsible for the audience that they are saying they reach on their platform. And for the infrastructure for you to be able to put your ad in front of that audience, what you are responsible for is the creative. Right. And so the way that you engage that audience highly depends on how engaging Your creative is. It's the very same thing when you think about experiential. The way that you show up to engage the audience on the ground will affect what your ROI is. So how much of it is it on? How much of it is on the event owners themselves versus the brand? And how do we make sure we find that middle ground so that it's fair and equitable when the measurement time comes?
- [14:56]
B
That's interesting. And how are you bootstrapping all this data? Crowd access is a relatively small company. You start with nothing. How. Where are you getting your data from?
- [15:04]
D
Yeah, no, great question. So there's three different ways that we look at data right now. The first is really public APIs. You will be surprised to just understand how much information is out there publicly for you to be able to, whether that's ticketing websites, understanding value and all of those different elements. And then licensing APIs which we also pull in. We have some commercial partnerships that we're leaning into as well to be able to understand things like geo targeting and folks that are locally coming into different events or another partnership that we just are close to embarking on but have already started using the platform is, you know, many events use survey based analysis to try to understand, hey, this is how you get sort of feedback from folks that have traversed an activation. A lot of what we do is really being able to take what's happening from a social sentiment perspective, but going even more granular than that with this company, where you get a sense of a pool, if you will, within that, that feels like it's more defined than just, you know, you think about your Facebook page, it's really your friends and typically it's the same sentiment. How do you get a good split of understanding different sentiments and different folks that aren't all grouped together. So almost like a survey, but really through social. So that's another piece of what we look at and to stick with market texture. Again, the whole point of why you guys are, you know, hosting this event and the content and all of that stuff is for you to be able to capture virality. Right. We want moments that people are going to get excited about or that's going to be out there and just folks talking about how they enjoyed the event. A lot of that is really helpful in understanding the value of the event, how it's improved and all of that messaging that comes out socially, it makes
- [16:59]
B
sense to harness social instead of treating it separately, make it part of the whole roi. So you're continuing a tradition here on this podcast of Being a guest who used to work at Undertone which is
- [17:13]
D
where Eric, who was the first besides Eric.
- [17:16]
B
Well we don't need a second after Eric, the founder of the company. I don't know Eric, can you rattle off some names of people who've been guests?
- [17:25]
C
We've had Jay asks, we've had Michael Cassidy, we've had Greg Glenday, we've had a bunch.
- [17:34]
D
Yeah, I'm in good company. You are wonderful folks for sure.
- [17:38]
B
So can you tell us a little bit about your journey from Undertone Double verify. How do you get into experiential and tell us about your career?
- [17:47]
D
Yeah, I'm happy to. When I was at Undertone and I spent eight wonderful years at that company and I used to be used as a token a little bit in the sense that when I started working at Undertone I actually started in the finance department and so I was really heads down into accounting for about a year. And Undertone, I mean Undertone was so amazing because it was sort of at the time it was the, the dot com bubble if you will. We were going through a recession but the bubble was just sort of like nothing was touching us. Everything was growing so fast and, and incredibly so. But here's the interesting that the, the interesting thing that the co founders did, which to this day I am still so grateful for. So they understood that dot com was new and fresh and you know, folks that were going to college were sort of graduating with marketing or advertising degree for the first time and they were coming into this world and in order to sort of lower attrition they would allow sort of this shadowing opportunity if you will. So if I wanted to learn about media then I can go and shadow someone that works in the media department. If I wanted to learn about account management I could do the same same thing for insights if you had an interest you can sort of move around the company as you see fit. And I thought it was such a brilliant idea because 20 years old, 20 something years old coming out of college, you have no idea of what you want to do. But if you're a skilled worker you could still benefit company by sort of moving around. And they used to be, this is back when budgets were aplenty and they would have, they would have conferences to, for employees like off sites like really well done and you got to hear all the updates about the company and how things were going and maybe this was sort of just a through line for startups at the time where they really felt like their, their employees was a part of the company and they want us to get us ingrained. And by the time you left there, you felt like, I really need to go out and win for this company. It was like a hurrah moment, if you will. And I would ask a ton of questions there. And finally Michael Cassidy came up to one of the VPs of sales and was like, you know, I think this girl, I think she should be in sales. Like I don't think she belongs in finance. I think, I think she should be in sales. And at the time I was actually studying for my LSATs because I was more going along the journey of becoming a lawyer lawyer and dodged a bullet there. Indeed. My, my brother in law worked at Lehman and what made this opportunity interesting, interesting for me is that all of the first years that had been hired had deferred, like their start date had been deferred because of the recession. And so I was like, I don't know if I want to get into this if they're already being deferred right out the gate and they have all these, you know, loans that they have to pay back. In any case, I, I, I initially frowned upon sales where I was just like, I felt like the only sort of reference point that I had for sales was a car salesman, a used car salesman. And it didn't feel like, it did not feel like that was like the realm of which I wanted to be associated with. And it didn't feel honest either. In any case, there I shadowed someone within the department and I recognized after going on a couple of meetings, oh, I could do this. Because here's the interesting thing and I'll be completely honest and candid on this, this, this podcast. The interesting thing was my association with used sale car salesmen. What I recognized was that when you're, when a used car salesman is selling to you, they're trying to get money out of your pocket. In advertising, we're getting money from brands that's already been allocated that agencies or brands directly have to spend. So the cell itself is not, not as much of a hard sell because, you know, some people are so tight with parting with their own money that in this one, if you don't spend it, you lose it. So all I had to focus on was doing a good enough job that the folks liked me enough and I could actually sell the product. And I thought that Undertone had a great product at the time and that I could do this. And so that is where my journey began.
- [22:08]
B
Amazing. You know, a lot of people still don't realize this, that the money has to be spent. The goal is to spend the money, not to. Not to convince them to spend the money. So last question is like, so give us the founding story on crowd access. How did you go from the career in kind of mainstream ad tech to this new thing, tell us about your co founder, et cetera.
- [22:29]
D
Yeah, no, absolutely. So I guess I spent so much time on Undertone I forgot to link the other part. So after Undertone I ended up going to a company by the name of Open Slate and I spent five years there at that company. And honestly that company was really fantastic opportunity for me because what I learned there is measurement. I learned a lot about what does self reporting Wall Garden. Right like with it. Because that's what the measurement was about. It was sort of bringing measurement to Wall gardens really. It started in YouTube and then we ventured into Facebook Watch and TikTok after that. But it was really being able to develop measurement. What does good look like when it's not television within digital video. Once I did that and I sort of solidly understood how to build out the measurement and understood a little bit more of how to push into sort of these self reporting aspects that really helped me to understand a world outside of sort of digital and the open web. And then looking into the Wall Garden and that was acquired by Double Verify after my fifth year of being there. I spent a short amount of time at DoubleVerify but learned a good bit even in that transition period of Open Slate, sort of mergin with the company. And then I went and led sales at Essence Ventures which really kind of bridged my knowledge of being a founder of crowd access. What I learned at Essence Ventures was super important and very hands on in terms of understanding that infrastructure matters when it comes to experiential. So Essence Ventures, for those who don't know, owns Essence, the brand they also acquired Beautycon, AfroPunk, Refinery29. So think about all of those properties that now is under one umbrella with a huge event portfolio that sits within them. And that I was leading sales across that. And so it helped me to truly understand we were sitting in rooms with brands that are at the top of the experiential bubble, whether that's McDonald's or you know, Target or Coca Cola or AT&T that, you know, are deeply entrenched when it comes to experiential. And I got the opportunity to hear firsthand from cmos what's wrong, what's not wrong, what are they looking for, etc. So I bridge the gap. A crowd access was birthed really out of our ability. My ability to see what measurement looks like within a wall garden where it doesn't exist and then experiential and the infrastructure of what needs to happen within that space. And I found my brilliant co founder Kerry Richardson which is so, so funny because we have the same last name but we're of no relation. So isn't it. The serendipitousness of that was just insane to me. But yeah, she has been a marketer for 15 plus years, has executed at the highest level when it comes to activation. So you know, huge brands and huge moments, whether that's super bowl and she led activations for Essence Ventures and you know we felt a lot of the pain points together which led us to in real time understanding. Here's how we would want to move the needle if we had a choice. What could we build to sort of fix this problem that has plagued us for a while?
- [25:45]
B
Wow, that's an incredible journey. It's really interesting stuff. So Alicia, thank you so much for sharing that with us. Crowd access, you can check it out if you're interested in experiential. It's really interesting product and the winner of our startup competition. So that gives us a little stamp of approval. So we're going to take a quick break and we're going to come back with all the news of the week with more trade desk drama, more AI drama. VCs don't like advertising, you know, all this good stuff. So we'll be back in a moment.
- [26:17]
E
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- [26:48]
C
We're back with the refresh. Let's talk about the news of the week. So I guess this counts for this week. Maybe it counts for the weekend. But. But there was a viral as these things go post on X about paid marketing. Interestingly, you didn't jump into the frayer. Why not? Why not before we get into it?
- [27:08]
B
Because it's just so tiresome that these west coast, these Silicon Valley people have the memory of a goldfish. And every year or two someone says something like this, which is like real businesses. I didn't do any sales and marketing to get to my 10 million ARR. It's just all natural. And they think that's like some badge of honor, like their geniuses. When in fact what it shows is that they haven't proven they can scale their business because inevitably, with the exception of maybe Google, every single business that has scaled in history has used paid advertising. And Google eventually started. Google's actually I think the world's largest advertiser right now. So this like VC thing where like oh, weak business plans have to use advertising. They're extrapolating from bad examples where there are businesses that have very low return on advertising. They're putting 80% of their revenue to Meta, let's say, and they're D2C brands and they're hoping to turn that curve. And yeah, okay, that's a bad business model. But then saying like, oh, only bad businesses spend money on advertising is like the dumbest thing I've ever heard.
- [28:16]
D
Yes.
- [28:17]
C
So what happened was Andrew Chen, who's a partner at a 16Z and he, he's an ex advertising person by the way. I think he used to work at like Value Click or Conversant back in the day. Anyway, he had this post, you know, basically saying there's lots of AI companies now and they're starting to experiment with paid marketing. And he said it was a bad idea. It's a tax on the products defensibility. The moment you can't outspend your competitors, you die. Build own channels, yada, yada yada. That then it got interesting when Bill Gurley, who's a legendary investor, just a legendary investor, he's been in Uber, Zillow, nextdoor, bunch of awesome companies. He goes on to quote, post it and say paid marketing is the crudest game you could play. It is admitting you have no creativity and actually restricts your creativity. Fire those that want to spend more. And he links a 2020, 2012 blog post of himself, Stuff X proceeds to go wild and points out all of the companies in his bio that he was an investor in, starting with Uber, just spent the hell out of hundreds of millions of dollars of his own money to be successful. It was quite funny to sit back and watch. And yes, it was also tiresome. There's so many examples of, of companies that have just taken off like wildfire. Tick Tock. Tick Tock was built on paid marketing. Built on paid marketing. Zillow Built on. It's just, it's, it's, it's wild. And the, and the receipts were, were plenty full and I just don't get it. Why every couple years they do this?
- [29:56]
B
I don't know. I think VCs and maybe you could speak to this, but VCS feel like they need to talk a lot, like they need to be out there saying things. And you say enough things and as a podcaster, I know this, you say enough things that some of them are wrong or stupid. Stupid.
- [30:13]
C
Well said, well said. You know, Alicia, I'd love to just. This can work. Do these like high end, you know, paid activations that we all see and inherently the vibes are good. Like does that stuff work or is there going to be a thread, you know, coming from some dumb VC about can and you know, other, other places that is just a, just a waste of money? Is that coming?
- [30:40]
D
Yes, it does work. I think it works if you are very strategic about what you want to get out of can. Right? You think about it from a B2B perspective. You have all the major decision makers that are literally going to that event. And so if you are strategic about who all is going to be there and can set up, you know, what you need to get done with these main decision makers, then it could be absolutely powerful for you. I think a lot of it is about how do you become strategic when there's so much happening on the ground and in this space. Right. You, you know, it is a hefty sum to go out and activate at a place like can. It's, it's not inexpensive and so you have to figure out is it the right place to be sort of a small fish in a, in a larger pond where so many people are spending you maybe much more than you and can ultimately be able to flex in that way. Or is it better to go to a market sector where you're spending less and you're finding similar folks, for example, that you can connect with and move the needle in that way. So it really depends on what the goals and the KPIs are for you to be able to determine. But it does work.
- [31:53]
B
And don't forget the product and the marketing matter too. Like you need to have the food the dog wants and you have to, you know, do a good job of sending the right people to the event and doing the right marketing and, and just, you know, throwing the right dinner, inviting the right people. There's a lot, lot to it.
- [32:08]
C
Absolutely, absolutely. I mean the, the post was seemingly around B2C companies.
- [32:14]
B
Yeah.
- [32:14]
C
Again, you have a great product and nobody hears about it. Like you're going to run out of money anyway. So, like market.
- [32:22]
B
So name some billion dollar B2C brands that didn't do any paid. I mean, it's just. That's a really tough question to answer. There was also a separate tweet. Like, Paul Graham, the founder of Y Combinator, posted something about things you should never do to entrepreneurs and number one was like, tell them to change their company name. Which, and then everyone in the comments were like, oh, Paul, you told me to change my company name like three times.
- [32:54]
C
I need to post it on my laptop, like right by the screen that just says never post.
- [32:59]
B
Never post. It's a good Advice.
- [33:01]
D
Post.
- [33:02]
C
Just VCs should not post. Anyway, let's get into ad tech. Last week we had the publicist bomb dropping about them challenging TTD with an audit. And this week, apparently Omnicom launched an audit of ttd. TTD said no issues have been uncovered. It was a standard audit. I mean, apparently, like these audits happen and we're just finding out about them here on the, on the architecture pod. But the stock continued to get hit. Feels like this is a nonstop barrage of things coming at ttd.
- [33:42]
B
Yeah, I mean, I put in my order to sell the shares I got from the Sincera acquisition a year ago and as soon as that happened, the stock's been in free fall. Right. So it's gonna. As soon as my shares clear, it'll be the low point and that'll be the buy. So I'd suggest everyone buy the shares probably in the next couple days.
- [34:01]
C
What else might be around the corner here? Do we anticipate more of this just audit pile on. Do we anticipate something turning for the positive for ttd? What do you think happens next, Ari?
- [34:15]
B
Well, on the audit side, I mean, it probably is incumbent on all of the major hold cos to do this now because if there is any reality to being overcharged, they want to know that they're agents for their customers. So getting to the bottom of an overcharge as part of their core business as to whether the audit comes out good or bad and whether we see leaks to the press of the results, that's where it gets really kind of messy. So. And these audits don't take a week, they take a while. So, you know, I think, I think the trade desk just has to do a better job on the comms. They're. They're getting battered here and I mean, I think the next Time we'll hear from them will be their earnings, which is probably, I don't know, probably, you know, a month and a half from now or something. I don't know exactly when the earnings are coming out. And everyone's, everyone's gonna be looking at those very, very carefully to see if there's any sign of this being a reality versus a press war.
- [35:08]
C
Yeah, exactly. Zeroing in on anything around what the Holdco representation is in terms of the mix and if it went down, that's going to be a biggie. On the positive side, they had a cool announcement. So Carson hooked us up with a post on LinkedIn. TTD is getting LinkedIn data for CTV. So I always just love this use case of trying to do really, really finely targeted CTV ads based on either people or account based marketing or super influential high ticket item decision makers. And TTD is getting the best data. So this could be super fun for B2B.
- [35:51]
B
Yeah, it's really interesting because previously LinkedIn data was only available in the Xander DSP and we all know Xander DSP got shut down. And the strategy for Microsoft was to enable their ad manager to use the data with their own algorithms. But their ad manager is not known for having a lot of external supply access. It actually kind of was dependent on Xander for external supply access. And so this kind of solves that problem in a really elegant way. It's only CTV and it's the leading platform and it's probably, you know, pretty sizable. Probably an enormous cpm. I can only imagine how high the CPM is for this. It's B2B micro segments on CCV. Like that's the combination could be $100 cpm. I don't know, I mean it could
- [36:38]
C
be a thousand dollar cpm. Right? Like just, you know, what would you pay on a CPM to reach a cto?
- [36:44]
B
Right?
- [36:45]
C
It's, it's, it's gotta be like super high. Listen, how do you think about like Experiential's role in Omnichannel? Right. Is Experiential maybe the ultimate upper funnel or with things like sampling and the ability to like, I don't know, capture first party data. Is it lower funnel? Right. Like where do you see it or is it both and I'm just like asking a dumb question?
- [37:12]
D
No, no dumb question at all. No, it's a great question. I think, think it's a blend of both. Right. So it is certainly the ultimate when it comes to branding because that's typically where you go in and you can kind of show off your stuff, right? So instead of sort of serving an ad, you're telling the consumer, come in, feel my product, touch it. You know, like you are, you are in their face trying to get their attention in that way. However, here's the, the, the piece that ties into sort of the lower frontal aspect, if you will. It's really the ability to get that data and then do something with it, right? So what we've seen as far as overall percentages is that conversion rates are much stronger and higher when it comes to experiential versus every other channel out there. Because 77% of folks, when they have traversed an activation or come into an experiential event, they feel like they can trust the brand a little bit more. So with that trust, that's currency, what are you doing with that? How are you using it? And that's a huge piece of where the standards I think needs to happen across experiential because many folks have, you know, thousands of people that traverse their activation, but they have no idea of who those folks are. Maybe 30 days after the event that think about even just your life, right, and how you move through something, you go to an event and you forget about it. Three days later, you're on to the next thing and then the next thing and the next thing. And so as a brand, not being able to access that data until 30 to 45 days after puts you at a huge disadvantage when you start talking about lower funnel activity. If I'm a brand, I'm aggressively looking at the high intent users that came into my activation. The ones that need a little bit more coddling in terms of, hey, learn more about the product. And then the ones that are a little bit further away, there should be immediate messaging that's going out to them, whether from a digital perspective or an SMS perspective. And that should happen within one to three days of the event, no more two weeks after that, 30 days, that's an autopsy report. You're dead in the water, Forget about it.
- [39:20]
C
Yeah, I asked because it just this stuff seems to be so fun for B2B applications, right? Like, you know, connect with a decision maker at marketecture, be able to take that data onboard it somewhere to start messaging them. Ultimately maybe on ctv. It seems like this could be like a really cool next gen mix.
- [39:40]
D
I agree, I agree.
- [39:42]
C
Yeah. All right, cool. So ads in AI, the Information reported that OpenAI advertisers aren't getting enough data to prove the ads work. And there was a couple of quotes that we'll put into the newsletter because information is pretty harshly paywalled. That came from the article. Two executives at agency is working with early ChatGPT advertisers said they haven't been able to prove the ads have driven any measurable business outcomes for their clients, end quote. Another one, OpenAI hasn't yet offered marketers any automated way to buy ad space. Buyers have had to rely on making phone calls and sending spreadsheets and emails to OpenAI reps. One ad executive said. Most importantly, advertisers found it hard to tell whether the ads were paying off. Surprised about this.
- [40:28]
B
They should really vibe code something, man. They should just be like, you know, hey chatgpt, build me an ad manager. Make no mistake, they should.
- [40:36]
C
But it, it seems like this was all just hey, be the first to get your ads on ChatGPT and we'll see how it goes. Like I'm not surprised about this at all from the rollout to the CPMs to all of it. And I think brands are still like happy to be there.
- [40:52]
B
Yeah, I mean I think if you want to go into the tech, they don't have their own pixel so you're not going to have anything closed loop. They're not going to allow cooking of the the exposure. So really the only piece of data they're going to the advertiser is going to get is a UTM parameter on a clickout and so they're only going to have click based conversion and it's dependent on the UTM parameter coming through accurately and the user effectively converting on that impression or within seven days. So yeah, not unexpected. They knew that going in that that was the data they were going to get. And the open question we don't know is whether the ads actually work work in general. Right. We know search ads work, we don't know if AI ads work and so this is pretty expected for the first attempt.
- [41:40]
C
Do you have any doubts that LLM ads are going to work just based on the intent signals? Well,
- [41:50]
B
so far the data from organic has been that you get a lot fewer clicks but that the users know more about the product and they convert at a higher rate rate. Right. Then that makes logical sense. So you would expect ads to follow the same pattern with high intent users clicking out and then potentially purchasing something. I don't think there's a reason to disbelieve that. The only counter argument is that Walmart we're going to talk about shopping in a minute But Walmart and OpenAI have changed the integration they were using because the first version where the products were kind of integrated into the results was producing very poor results. You know, I think one, one third as many clicks or something they reported. I don't remember exactly the data, but it was bad. And that's like a little bit of a red flag or a yellow flag that there's something going on here in the way the consumers are interacting with the results.
- [42:47]
C
Yeah, I think that makes sense. I mean I just again, I. With the, the, the amount of investment, with the sheer scale, with all of the signals with the hires that they're making, they're just higher. A former meta exec David Dugan to lead ad sales. I mean I can't imagine this is not going to be a monster. The only question from my perspective is when and how many mistakes do they make along the way?
- [43:11]
B
Yeah. If they continue to have the market share in AI that they do, which is, I don't know, the latest number, 60, 70% of consumer usage and they can't create a monster advertising business. It's like the greatest fuck up in business history.
- [43:24]
C
Yeah. It would be the biggest owl of all time.
- [43:26]
B
Yeah, like so let's. I would just assume they're gonna figure this out.
- [43:29]
C
Yeah, yeah.
- [43:30]
D
You just said something Ari, about they are retaining the information. So the ads, they are retaining it. Could it be. But how do they prove. Right. Like that. I guess that's what we're talking about now because you just said it would be the biggest. You know, miss, for example, it's not
- [43:47]
B
exactly what I said.
- [43:53]
D
If, if they can't, if you know, this is always an attribution play. Right. Like it's always going to boil down to that. Regardless of whatever channel that we're in, it's always sort of last touch attribution. How do you get around that? I suppose if, if, if, if what I'm sharing with you to your point is you're retaining it and finding out more about the brand, who then gets the credit for that? Right? Like who gets that? Is it a different messaging that maybe you put on AI to see if the way that folks interact or the actions that they take is directly attributable to that piece? I don't know.
- [44:28]
B
Yeah. Just from a plumbing perspective. All the major social networks have their own pixels. So you ask the advertiser to put their own pixels. So it's a closed loop within that. And then you have the E commerce feeds where you can get a feed of all products being bought by timestamp and geography and work back. Those are pretty, those are lifts, those are pretty big lifts. And, you know, we know that OpenAI is very stretched thin and there's been separate news that they're trying to consolidate the things they're working on to put more wood behind the arrow. They just announced that Sora is going away, or they just actually just pulled Sora. It's just not active anymore. So I think there's more evidence here that they're going to spend more time on the things that make the money and less time on the. On the side. Side quests.
- [45:14]
C
Yeah, pouring out for Sora. This Shopify Agentic storefronts thing I think is interesting. So they just rolled it out this week, basically, like Shopify merchants can sell to ChatGPT users, but then also Microsoft Copilot, AI Mode, Google Search, the Gemini app. I went and tried to do this. So in the post, which we'll put in the newsletter, they quoted Fenty Beauty as one of the pilot brands. So I went and like, you know, tried to look for products by Fenty Beauty and I started getting them and it was really well done. Like, it suggested a specific product, it suggested the, the color, the, the quantity. And I would do these dropboxes and then where I could buy it as a consumer, it was changing, like in real time. So started with like, you could buy it like on Sephora, on Ulta, like whatever, three stores. And then when I, you know, made a couple of modifications to the product based on what I presumably would want, it was like, okay, you can now buy this on Sephora and Sephora only. So this was really well done. I think this is going to be big.
- [46:25]
B
Yeah. So this is effectively OpenAI adopting Google's approach. So they both had shopping integrations announced last year. Google was in January, and they were slightly different because OpenAI, I think the way to characterize it is that there'd be a single shopping experience in ChatGPT that then the products would flow into. And OpenAI was going to take a 4% fee on that, like kind of like an affiliate basis. And yeah, this did not happen. And that didn't happen. That didn't work. Right. And so Google announced ucp, and UCP was like, put your, your checkout in our AI. And now OpenAI has moved to that. And now OpenAI has momentum because they're live with Walmart. And today in the Wall Street Journal, Sephora announced they were in there and this is there. And I think this is also kind of if we want to friend the pod, this thing, this sounds like really what our friend Michael Rubenstein has been building at firsthand. Right. Isn't this exactly what they've been. Because I've always had a hard time figuring out what the use case was going to be for his branded agents. But this seems like exactly where it's headed is every brand has their own agent or their own chat and agent.
- [47:35]
C
Yeah, yeah. So disclosure, we're by fund appearance as an investor in firsthand. But yeah, I mean that's the. Yeah, thank you. Knock on wood. That is, that's the thesis behind it, which is brands are going to have direct relationships with consumers via agents or chatbots. The question is like where do they live? Right. And where as a brand do you, do you send people? And I think you need to be everywhere, including the chat experiences on ChatGPT. So I'm impressed. I think this is pretty cool. I think we're seeing more of this.
- [48:04]
B
Yeah, it's very exciting. I think. You know, once again there's this debate. Agentic shopping. All that stuff people want to shop inside AI that's not agentic. That's just using the power of LLMs to find products and doing things. That is well underway. People are buying products. They're using Rufus, they're using all these products and it's exciting to see them go into the, into the mainstream AIs. ChatGPT. Gemini.
- [48:27]
C
Yeah, yeah. And the product name is good. Agentic Storefronts. I think it's, that's what it is. Right? It's not Agentic Commerce and Agentic Storefront. Just a different place to interact. You don't like the name?
- [48:38]
B
I, I at least word.
- [48:42]
C
He's the name king. So
- [48:45]
D
I watched a couple podcasts. I, I, I, I see the things that he hate. Hates as far as like some of the naming, which is, has been very funny.
- [48:53]
B
I don't hate. I think agentic is getting a little overused. I'm just like a little quizzical about throwing that word in there, but I don't have a strong opinion here.
- [49:01]
D
You just made a mention. If I could ask one tiny question for clarity, just for my own edification. But you said that's not agentic. It's just LLM using. How do you make the distinction between the two?
- [49:15]
B
Okay, this is one of those things where I'm going to get hate mail from people. But my understanding is that use the word agentic if it's, if the AI is like doing something for you, like it's an agent, if you tell the AI to do something, hey, go find me the 10 best products on these sites and come back, that's an agent, whereas a chatbot is not an agent. You're using an LLM. It's not. It's answering a question, but it's not proactively doing something for you. I guess there is kind of a blurry line between these things at some point, but that's just the way I would think about it.
- [49:49]
D
Got it.
- [49:49]
C
I think that's. That's well said. Yeah. All right, let's wrap it up with some weird stuff.
- [49:55]
B
So.
- [49:57]
C
So in from.
- [49:58]
B
From.
- [49:58]
C
In the not weird department, but maybe throwback. TikTok is adding some more ad formats and some more aggressive formats. Each one of them is like, you know, taking you back like 20 years. So when the app opens, you know, there's typically the TikTok logo and then it launches into videos. They're going to offer like a logo takeover. So you could have your logo next to the TikTok logo and then a couple seconds of your ad experience. It sounds just like the old Forbes welcome ad where you would go to Forbes.com and then you would get this full page ad and you would skip or wait. They have a prime time format so you can blast ads like in a 15 minute timeframe so during a game or something like that. So three ads in 15 minutes, day parting. And then they have something called Top Reach, which is basically you can. You kind of buy the most prominent formats, which are the top and bottom formats in the experience. So they're getting aggressive. I think they're really turning on the monetization. And these are like all throwbacks. I thought it was pretty interesting. Alicia has sold a lot of these in her day.
- [51:05]
D
That reminded me, I was literally thinking the first one you said, I was like, that's an undertone page grabber. That's literally like what we were selling. That was a money maker with the rich media. And then you take over that. You know, listen, is there something wrong with bringing back things that might have worked in the past? Right. To then sort of capture dollars like in these environments, are we, are we poo pooing that? Or is that okay to be done within this wall garden, if you will?
- [51:35]
C
I mean, it's what Applovin is building their business on. So I don't think anybody could question it.
- [51:40]
B
I think web publishers should get more aggressive. Fewer ad units that are a lot bigger here.
- [51:44]
C
Yeah, for sure. Okay, now, weird. So Samsung has smart fridges. They're super expensive. They're supposed to have some utility with respect to like product reordering or fulfillment or you're low on this stuff. Apparently they just started running banner ads on them and the Wall Street Journal did this expose and the quotes are so, so funny. People just started getting batter ads and some full screen ads, by the way, on their refrigerator where they're going like, you know, just like, get, get a glass of orange juice or something like that. This is nuts.
- [52:23]
D
No screen is safe.
- [52:25]
B
That's really, really not what I want. We now need like a ad blocker for Samsung fridges.
- [52:34]
C
They need to get. They. They need to get ahead of this and explain the value that they're bringing. Because this is a. This is a rough one. It's a journal article. I recommend you read it for the left.
- [52:47]
B
Yep. So there were also this week new fronts with tons of announcements. We're not going to cover every single one of them. Probably you're being bombarded with it. We'll talk about it next week. All right. Well, this is a great episode. Lycia. Thank you so much for joining us.
- [53:02]
D
Thank you so much for having me. It's been my pleasure. I learned so much from this podcast. I am excited that you guys obviously had me on. But just to, you know, have this conversation from folks that are so established, know a ton about all the things that are happening and moving and shaking and I'm happy to have Experiential get the place that it has earned unto itself in this podcast. So I hope to hear more about Experiential moving forward. It's earned its right.
- [53:33]
B
Absolutely. I want to talk about it more and I think. I'm sorry I don't have the specifics, but the whole startup showcase will be on YouTube at some point in the next week or so. So if folks want to see the presentation, just keep an eye out for our various social and we'll point people to the YouTube channel when it's out. Thank you so much, Eric. Thanks for hosting as always.
- [53:53]
C
Yes, thank you both. And we will see you next week, everybody. Bye bye.
- [53:57]
D
Thank you for subscribing to market.
- [53:59]
B
New interviews are added every week at
- [54:01]
D
marketing and your favorite PODC casting appointment.