← MarTech Podcast ™ // Marketing + Technology = Business Growth
MarTech Podcast ™ // Marketing + Technology = Business Growth
How AI orchestration will shape the next wave of software innovation
00:25:46
Loading summary
Transcript35 lines
- [00:00]
Benjamin Shapiro
The Martech Podcast is a proud member of the I Hear Everything Podcast Network. Looking to launch or scale your podcast, I Hear Everything delivers podcast production, growth and monetization solutions that transform your words into profit. Ready to give your brand a voice? Then visit iheareverything.com.
- [00:26]
From advertising to software as a service to data across all of our programs and clients, we've seen a 55 to 65% open rate. Getting brands authentically integrated into content performs better than TV advertising. Typical lifespan of an article is about 24 to 36 hours. If we're reaching out to the right person with the right message and a clear call to action, then it's just a matter of timing.
- [00:54]
Welcome to the Martech Podcast, a member of the I Hear Everything Podcast Network. In this podcast, you'll hear the stories of world class marketers that you technology to drive business results and achieve career success. Here's a host of the Martech Podcast, Benjamin Shapiro.
- [01:16]
Recent research from McKinsey Digital identified 63 AI use cases in marketing that they estimate will generate $4.4 trillion in economic impact annually. It's no secret that AI's future impact is staggering. But today's reality fuels the illusion that every business must universally adapt or die. Here's the real, real US marketers are drowning in AI hype today. Tools promise everything, but they don't deliver meaningful returns. So how can you separate out real innovation from empty promises? I'm Benjamin Shapiro and joining me today is Tom Chavez, a co founding general partner at Superset. Tom has built and sold startups to some of the biggest tech companies in the world and now he runs a venture studio that funds data driven AI applications to deliver practical business results. And today Tom and I are going to delve into what's real and what's not when it comes to AI's impact on marketing. Tom, welcome to the MarTech podcast.
- [02:16]
Tom Chavez
Good to be here. Thanks for having me.
- [02:18]
Benjamin Shapiro
Ben, excited to have you on the show. It's an honor and a privilege. I said before, you've done some great things, started startups, sold them to big companies, and now you're passing it forward in your venture studio. You said something smart to me when we first met was that you described the AI arms race as a head fake. So how do you view the landscape of AI software innovation today?
- [02:41]
Tom Chavez
I find it incredibly exciting. Right. So it was funny that I was at a party recently and there's a curmudgeon there who's talking about, oh, this AI stuff. It's such a bunch of Nonsense. It's just endless hype as far as the eye can see. And I found myself putting the brakes on this and letting this person know, no, I've been at this for a while, and I've seen fads and I. I've seen things that were never meant to be. Right. In tech, we get very excited about new possibilities. That's why we love what we do. And some of those things never come to pass. AI is very real, very deeply rooted, so certainly not a fad. On the other hand, and I think the reason I think of it as a head fake is that in this particular case, the hype is just hopelessly out of control. Right? So we can hold this idea of the promise of AI without subscribing to all of the breathless assertions about artificial generalized intelligence. You know, the AI fairies swooping down from the sky to take care of everything, to do all of our thinking, for us to do all of this gut work that we don't want to handle anymore. I think that's wrongheaded. So my concern as everybody rushes into AI is that we just take a more balanced view. I think there's an equilibrium point here in the middle where it's possible to harness the potential of AI to radically transform what we're doing in the marketing realm, but with a view towards what I think of more as augmented intelligence. So, AI, but let's have the A stand for augmented intelligence. And what I have in mind is this idea of putting the machines to work to make what modern marketers do cooler, better, faster, stronger. That's the premise.
- [04:16]
Benjamin Shapiro
I hear you. I agree and I disagree. I agree with the principle of augmented reality being the reality. I'm thinking about the stages of prepping for this interview. I'm using artificial intelligence to mine data sources that I know are important to marketers to figure out what is the most relevant so I can frame my questions. I did research on you, right. I analyzed my own tone. We created our copy for our thumbnails in advance and our titles for YouTube. We do all these different things in advance to get ready. It's amazing. It makes my whole job easier and it augments the entire process. It is an external brain.
- [04:55]
Tom Chavez
It's awesome.
- [04:56]
Benjamin Shapiro
Your argument for me to take the counterpoint is, well, but it's not going to be an AI fairy that drops down from above and hopefully not the Terminator to come and kill us all. But I do think that there are stages. There is an evolution here where we get to a point where actually that does become the Case. And we are just so in the first inning of what's probably a 25 year rollout of the sort of manifestation of AI in the same way that mobile technology is still rolling out. And the first wave of iPhone apps were groundbreaking, amazing. But Uber didn't come around till 10 years after the iPhone. So I hear you in the sense of like, it's not going to be life changing, but I also want to say not going to be life changing and take over everything now, but what's stopping it from getting to that point over the life cycle of the technology, which seems to be moving very quickly.
- [05:47]
Tom Chavez
So if we're talking about 25 years, Ben, I'm all the way with you. It really comes down to the time horizon we're using to structure this conversation. I think certainly in 25 years, agentic AI will be doing the lion's share of the work that we think of in the context of modern marketing. No question. Is it going to happen next year? Is it going to happen within five years? I'm out of the business of trying to predict exactly when these things happen, but I do like to just in this moment, let's recall you and I have been at this for a while. In the late 90s, I think it was 99, at the height of the dot com bubble, there was this concept that Rogers and Peppers were putting forth called one to one marketing. The reality is, if you've been in the boiler room of digital marketing, there's smidges of one to one marketing here and there, but it's really been one to many marketing. Right. We do a lot of segmentation and cohort analysis and so on.
- [06:37]
Benjamin Shapiro
Hang on, hang on. Yeah, but aren't we getting to one to one marketing now? Like, weren't they just wrong about the timeframe?
- [06:43]
Tom Chavez
We finally are and instructively it's 26 years later. Right. So if we're taking the long horizon, absolutely, these things unfold. By the way, I also want to say with AI, what used to happen in nine months is unfolding in nine days now. So that's why I stay out of the business of trying to predict exactly when. What I am proposing is that in the next one to five years there will be transformative possibilities in the use of AI to remove so much of the scut work that modern marketers deal with. Right. As they try to synthesize data from different sources and cobble it together into a picture of what actually worked. With the last marketing campaign, they launched new techniques for experimentation, personalization, targeting synthetic data I'm really excited about those possibilities, but it's not going to blow up the entire apparatus, I don't think in the next one, two or even three years.
- [07:35]
Benjamin Shapiro
We've both been around for a little while, but not forever. But we've seen a couple of the cycles here and I think it was, let's not go back to the invention of the telephone and the newspaper, but we saw sort of the peak of television advertising, the rise of the connection of the world with digital marketing, the mobile marketing revolution. And this seems to be the next evolution. Are there common stages that you've seen from some of the other changes in technology that have affected marketers?
- [08:05]
Tom Chavez
Well, I think you have your thumb on so many of the most important ones. Right. There was the movement to mobile. I'm thinking of my friend Greg Stewart who started the Mobile Marketing association and now it's the modern Marketers association. Because as mobile just became part of marketing. Right. Once upon a time and you were there for it. There was a thing called online banking, now it's just banking. So what part of marketing for the modern marketer is not mobile or multichannel, multi surface and so on. But that was one big revolution, I think the movement to big data. We used to use that word, we don't use it anymore, but big data in the cloud, that was equally transformative. In my first startup it used to take us literally two days to compute something equivalent to the calculation of a segment, an audience segment in our second company that we used to do in about seven minutes. So I've experienced those transformations myself. I think cloud and data was equally tectonic. AI is going to be at least as huge and as you said a minute ago, we're in the first inning for sure. So when I say as a head fake, I'm not a luddite about this stuff, I think it's really happening and it's happening fast. I just reject the idea that all of the work that clever creative marketers do is going to be immediately supplanted by machines. I think the claim on the table here is that the near term possibility is really about augmenting what marketers do again to make it cooler, better, faster, stronger.
- [09:29]
Benjamin Shapiro
The only argument I have for expediting the pace, like when we think about these sort of generational technology changes, 15 to 25 year rollout periods and there's this incredible hype up front, Al Gore created the Internet, whoever we're going to credit for it and then all of a sudden everybody's excited and there's websites and there's oh look, the first blogging platform and aol and then the shine goes off the Apple and then it gets more into a slow, steady pace of innovation over time and people don't think about it and then it just kind of gets normalized into the way that we do things. Mobile is the one that I think that we saw most recently. Nobody thinks of their mobile strategy. They think of their strategy and they have to have a mobile component to it because that's how the world works. Now with artificial intelligence, there is a notion of the AI does the work for you and gets smarter and you can build faster. And so I guess the only question I have for you is when you compare these 15 to 25 year segments, do you think the artificial intelligence technology wave happens faster? Does it consolidate faster? Do we peak hype and drop and then go steady? Or is it just straight up and to the right?
- [10:40]
Tom Chavez
Look, in my second company, it wasn't just in the calculations and computations we were doing. Things that used to take two days suddenly are happening in seven minutes. The way the markets moved, what used to take years would happen in quarters as I moved from my first company in the early aughts to the second one in the 2000 and tens. So we're dealing with that here today. And I don't know if, is it 5x, is it 10x? I don't know exactly, but it is up and to the right. To your point, Ben, it's exponential. It's way faster. In our studio, I work with our teams and I always aim to be realistic, but a little bit unreasonable too, where I say, listen, if that thing that you thought you could do in two weeks, if you could do it in two days, just know that your competitors are getting it done in two days. The speed at which we using these new Vibe coding platforms and the like, the way software is generated is fundamentally transformed. And I was, by the way, six to nine months ago, I was a little skeptical. And then I wrapped my head around it got closer to these developments. Holy guacamole. It's not a state of mind. So is it 10x faster? Is it 50x faster? I don't know, but it's a hell of a lot faster.
- [11:45]
Benjamin Shapiro
I broke my leg and I spent the last two weeks on my back with ice packs on my leg, in bed with my laptop and I became an email deliverability expert. I have no idea why, when I had every excuse in the world that all I wanted to do was build infrastructure for my company. But Somehow I got locked into talking to AI about how email deliverability works and how our infrastructure should change. And I basically went under the hood, ripped out the engine, rebuilt it, popped it back in, and now we've solved all of our deliverability issues. I'm not an engineer, I'm not an email deliverability expert. And so to me, what's interesting for marketers, and maybe this goes beyond just our craft, is your ability to execute in areas where you are not a specialist is now possible. I guess that's the definition of vibe coding, but maybe it's vibe marketing. You can do so much more with very little knowledge of what you're actually doing.
- [12:42]
Tom Chavez
I'm curious to know what systems or platforms you are using, but it sounds like you're doing some vibe coding and you're experimenting with the Lovable and Cursor and similar systems. I think vibe marketing is coming soon to a theater near you. It's unfolding now. My concern for the marketers who are letting somebody else do that, right? I love to ask people when I bump into them, like, how many times per day are you using an LLM to do anything to get an answer that satisfies curiosity or to get your job done, to rewrite some of your copy, to write some code, to get some data, how many times are you using it? And the folks that scare me the most are the ones who kind of fumble about and say, oh, still, you know, I'm not quite on it yet. Or I have some guys who do that for me, like, oh my God, dead man walking. You've got to be on these systems.
- [13:28]
Benjamin Shapiro
I use it for everything. I craft emails, I identify my tone. I use it to research my guests, every single part of my world. I'm using it to diagnose whether the level of pain I'm having for my ankle is normal, so I don't have to harass my doctor. Like, I use it for everything. And the scary thing is I don't know if it's right. I just changed all my email marketing infrastructure. Boy, I hope a consolidated DMARC is the way to go and I don't blow up all of my deliverability for all of my podcasts, but I guess we'll find out. So talk to me a little bit about some of the practical applications. How can marketers integrate AI into their existing workflows to maximize their efficiency?
- [14:10]
Tom Chavez
I think that where we live today, the highest, best use of these kinds of AI techniques is in dull, repetitive, high stakes tasks. So in the context of marketing and you mentioned it. Listen, Nobel Prize winners and Pulitzer Prize winning authors are using AI to make their copy cooler, better. That's what the Nobel Prize winners are doing, by the way. I'm using it a lot myself in the same way. Use the AI to write smarter, better copy. I think that there's a lot of opportunities in the analytic realm now to do what you might call AI for bi, AI for business intelligence. Marketers are exhausted by all of these damn dashboards hunting and pecking in yet another dashboard. I'm not in looker tableau. All of those systems were awesome for a long, long period of time. But what I see is a lot of exhaustion out there among marketers who have to hunt and peck through 25 screens to get the answer that they need. It's happening now. We're building it in my shop. A marketer can go now to what we call a chat with data interface and ask how many women between the ages of 25 and 35 who buy $250 of groceries or more per month use my coupon to buy my product in April. Boom. Right away, no dashboards. Just give me the answer. Right? That's what we love about. I like to point out LLMs are obviously a technology transformation, but I also think it's a revolution in the interaction mechanism now that we have with machines. I don't want to go and poke all around your website, by the way. This is dangerous ground for publishers because too many people are just going straight to the answer engine. They don't want to go to a new source anymore. They just want the answer. So there we are again, all of us using. I think marketers have the opportunity to use these kinds of techniques to change what they do in the realm of analytics, targeting and personalization. I don't know why we don't pay more attention to this, Ben, but whenever it was three, four years ago, my chronology is always a little off. Meta's sole regulator, a company called Apple, decided that they were going to start asking all of us, do you want this app to track your movements around the Internet?
- [16:19]
Benjamin Shapiro
I heard about that.
- [16:20]
Tom Chavez
And so in one fell swoop, 70% of us said no. 70% of Meta's data used for targeting and personalization was vaporized and their market cap nearly collapsed. It was a really scary thing. And there were a number of people who were foretelling the end of Meta. Well, I wasn't in the room, but I'm pretty sure there's a guy over there named Yann Lecun who's the Head of AI probably went to Zuck and said, listen, man, I think we're okay. Believe it or not, 30% of the data we used to have is plenty good. Let's put the machines to work and create synthetic data with the same statistical properties as the broader data set and use that data for personalization and targeting. It worked.
- [17:04]
Benjamin Shapiro
Let's dive into synthetic data because I've had a couple of interviews where we've touched on it and haven't really gone deep. I get the general principle, which is you take an existing data set and you kind of extrapolate out what it might look like if the data set were bigger. But how is it accurate when you are taking 100 million Facebook users and you're saying, okay, well, what would this look like if there were a billion Facebook users? They're assuming what the other 900 million, whatever the number is, that's the delta that they know what's going to happen. Without the actual interactions happening, it seems like it is predicting the future. Walk me through how synthetic data actually works.
- [17:43]
Tom Chavez
These techniques, by the way, predated LLMs, and we should be clear about that. Some clever statisticians around Stanford and other places developed a set of techniques. Back in the day. There was something called boosting. Same idea. I'm going to take a small sample of data set, I'm going to recycle that data. I'm going to boost it in a way that maintains the statistical properties of the core data, the same means and modes and moments of a statistical distribution. Right. So by emulating the behavior of that data as if it were a larger data set, but in a way that retains the core statistical properties of the seed, you could get more data to feed. And this is where it became so powerful in the context of AI, because we know AI is hungry for data. You can take that much larger data set and not predict the motion of individual users. We're not at Minority Report yet, but you're able to predict with very high efficacy.
- [18:37]
Benjamin Shapiro
Scares me. You said yet?
- [18:38]
Tom Chavez
Yes. Yeah, it's probably coming. You could take me via my participation in a cohort of other users who look, walk, quack, talk like me and give me more of what I want in that little moment of truth when there's something happening on a screen. And lo and behold, the combination of these tools for processing of very large data pipelines, coupled with the statistical properties that were invented a bit ago, this kind of grand synthesis of all of these techniques now to create the synthetic data that saved Meta's ass as far as I'm concerned. Right. Advantage plus is the AI system that they use now for targeting and personalization. By the way, we use it in some of our companies inside my studio. It's magic you can train those algos on. Here are users who converted, here are users who bought my product. There's no way to decompile and that's what's scary and frustrating for some marketers. I can't tell you why because it's deep, deep in the third layer of a multi layer neural network and nobody knows why. Geoffrey Hinton, the inventor of all of these kinds of systems, will also tell you we don't know why. I can't explain it, but it just effing works and it's working at gigantic scale. Meta's numbers are evidence of that. So when it comes to modern marketers, my point to them is, listen, this is the game you can run but you can't hide. This is the game Meta, Google with those kinds of AI based systems for targeting and personalization, it works. Do you really want to show up at a gunfight with a really sharp pencil? You're like, don't play along, play the game. You've got first party data and it doesn't have to be as huge as you think it needed to be. In my last company, Ben, we had a very prominent digital marketing brand who came to us hanging their heads and said, well, we only have about 250,000 records in our loyalty database. And at that time, because we didn't have all of these new techniques and all of this new compute power, yeah, you had to go out to the open Internet and buy a bunch of third party data which they didn't have a lot of confidence in, but you had to boost the signal from what felt like this meager data set to go and do personalization at scale. Well now 250,000 high quality like this is the triumph of small data now over big data. Small data that has a lot of fidelity and accuracy to it is high octane fuel for the modern marketer. If you're going to play this game.
- [21:01]
Benjamin Shapiro
I guess that's really the takeaway is that small quality data can be synthesized to be more powerful than big dirty data.
- [21:09]
Tom Chavez
And listen, I'll do a mea culpa here with you. In my last project I used to sit on stages and I would crow about the 3.5 billion monthly uniques that my company's infrastructure was seeing and managing. Monthly. That's a huge number. What I didn't want to talk about was that a good 20% of it was bots. I don't know. Another 15, 20% of it was fraud. And then a lot of it was just, as you said, just dirty, unreliable data targeting behind the targeting of those uniques. Like, we were barely hitting the side of the bar with some of the uses of that data at that time. It's not like that anymore.
- [21:45]
Benjamin Shapiro
Tom, I want to move on to your current role, understanding the funding phenomenon when it comes to artificial intelligence, does AI integration create a competitive advantage in marketing? Like, how much of this is a hype cycle and how much of it is companies that are actually saying they use AI or invest in AI or have built AI actually increasing their valuations?
- [22:09]
Tom Chavez
I think there are a number of companies who are talking the talk, and God bless them, they probably should, and they're seeing the results in their equity valuations as a result. Yank back the covers. And as you said, we're in the first inning still. So lots of pilots. Nobody's moving effectively yet, to our knowledge, from pilot to production. And that's okay. That's exactly how these kinds of technology cycles evolve. The marketers who aren't taking shots are the ones who worry me the most. Take some shots, invest in some experiments, and be Zen like about the fact that not all of them are going to work, but, oh, my God, you got to get off the couch and start experimenting.
- [22:46]
Benjamin Shapiro
I wonder about the positioning the marketer in me sitting here saying, you have to position yourself to be an AI led, whatever you are. We are an AI led podcast production company now. I'm using ChatGPT and Claude and zapping data around to ask different queries. I'm not inventing anything proprietary. I'm just using the tools that are at my and everybody else's disposal. Does that mean that we're AI led because it's integrated in what we do? Well, if it comes down to the valuation of our company, you bet your ass. I'm saying we're AI led because I think that actually means something right now. What does actual AI LED mean?
- [23:23]
Tom Chavez
Well, you can hate the game or you can hate the player. I urge everybody to hate the game. Right. I think you're doing it exactly right. You are an AI LED studio and that's what you do. Now, how do you pay that off so you can take a few liberties, I guess? Ben is the point at the beginning, but you have to pay it off with real outcomes and real results through systematic investments in these kinds of techniques. Over time, there's going to be a big Washout. Right. We've all seen the trough. You know, we enter the back end of the hype cycle and we enter the trough of disillusionment, where the bubble bursts and everybody says, okay, you were high and or you were lying. That's going to happen. But there will be a number of serious contenders and serious players who emerge from all of that, and they're going to win because they weren't afraid to take shots, in my view, and they were just learning from those experiments and the ones that failed at least as much from the ones that worked. And they're doing it faster than everybody else. So that's sort of the way I look at it. I'm excited by all of it. Right. I think sometimes this technology stuff exhausts people. Like, oh my God, you guys all get all worked up about these things and then so much of it doesn't work. Yeah, yeah, yeah. But listen, the pieces that do work are really consequential. So not a good time to be a curmudgeon. I think it's full of possibility these times we live in.
- [24:40]
Benjamin Shapiro
I think the metaphor is you miss all the shots you don't take. I might be butchering that, but it sounds like it should ring true in this case, where if you're not leading with AI and flouting how you use it and how it is transforming your business, you are missing a great opportunity to a position yourself to be a leader, somebody, an expert. And also there's a valuation wave that is very much tied to the hype cycle around AI. And that wraps up this episode of the Martech podcast. Thanks to Tom Chavez, the co founder and general partner at Superset, for joining us. If you'd like to contact Tom, you could find a link to his LinkedIn profile, which is in our show notes, or on martechpod.com or you could visit his company website, which is superset.com you can also find Tom on his podcast, which is closed session. If you haven't subscribed yet and you want a daily stream of marketing and technology knowledge in your podcast feed, hit the subscribe button in your podcast app or on YouTube and we'll be back in your feed next week. Okay, that's it for today, but until next time, my advice is to just focus on keeping your customers happy.
- [26:08]
Thanks for listening to the Martech podcast and I hear everything. Production. Looking to launch or scale a podcast like this one for your brand? Then visit iheareverything. Com.