← The CPG Guys
The CPG Guys
Live from Cannes Lions with U.S. Bank’s Michael Lacorazza & Supergood’s Mike Barrett
00:46:09
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- [00:01]
Mike Barrett
If you're planning on attending grocery shop this fall, make sure to arrive in Las Vegas mid afternoon on Sunday, September 28th. That way you'll be able to attend the Big Grocery Shop Kickoff Party being hosted by the CPG Guys in partnership with Rethink Retail. The party runs Sunday, September 28th from 6:30 to 8:30pm Our kickoff party is where all the industry luminaries customarily gather to celebrate the beginning of this annual event. In the coming weeks, we'll provide more details on how to register and how to sponsor. In the meantime, make sure your travel plans ensure your arrival in Las Vegas. To join us for the Kickoff Party, I'm Mike Barrett.
- [00:43]
Michael Lacaraza
I'm the Co Founder and Chief Strategy Officer of Supergood. I'm joined today by Michael Lacaraza, who's the Chief Marketing Officer at U.S. bank on the CPG Guys Podcast.
- [00:55]
Mike Barrett
Welcome to the CPG Guys Podcast. Your host, Shree Rajagopalan and Peter Vs. Bond explore how brands and retailers engage consumers in an increasingly digitally driven world. And now, here are the CPG Guys.
- [01:15]
Sree Rajagopalan
Hello and welcome to the CPG Guys Podcast live from the Cannes Lions International Festival of Creativity straight from Cannes, France. I'm of course sri, your co host and joining me today is the other co host, Peter Vs Bond. When not on the CPG Guys, I'm also CRO and co founder of Think Blue Consulting, a management advisory firm focused on omnichannel brands and retail transformation. Please do listen to my older daughter's music@www.riaraj.com. that's R H E R A J. My younger daughter Lara Raj is a member of the fast growing global girl group Catseye. The new hit Gabriella is out on all channels. We recently hit episode 500 with Amazon VP of ADS Dana Elton, released on June 18th. Please do check it out on all podcasting platforms. We appreciate you leaving us a review and rating on the Apple Podcast platform. It informs us how we're doing and if you're having the right conversations on this podcast. The CPG Guys were here all week and recorded several episodes with industry luminaries from CMOS to brand and retail media leadership. Enjoy this episode. And now onto our guest today. Let's welcome Mike Barrett, Co Founder and Chief Strategy Officer, Supergood and Michael La Corazza, CMO of U.S. bank. You have two leaders who both mastered brand building, modern strategy and performance marketing, but from very different industries. This is a chance to explore where consumer brands and financial brands actually intersect and what lessons they can pass on to our industry from each Other Mike and Michael, welcome to both of you on the CPG guys. This is the second financial guest to actually appear on the show because we go to Cagny, we work very closely with Wall street, and we have Nick Modi, one of the analysts from RBC on our show pretty frequently evaluating CPG stocks. So welcome to you both on the show.
- [03:00]
Peter Vs Bond
Thank you for having us.
- [03:01]
Sree Rajagopalan
We'll of course include your LinkedIn profile super good in US Bank Brands website and LinkedIn pages for our listeners to access in the digital liner notes of this episode. So let me kick it off with a very important one and it's for both of you. Maybe you can go first, Mike. How do you both define a brand today? In a world where consumers expect two things and every single time meaning value.
- [03:30]
Michael Lacaraza
I think the measurable value definition of a brand hasn't changed much. It's still the relationship that people have with a company, however they experience and express that relationship. That's what your brand is. I think what is changing is how those relationships happen. And I think one of the most interesting things about being alive right now from a marketing perspective is the way consumers are using media as an operating system to engage with brands. And I think if you're a brand right now and you're thinking about your relationship with customers, programming content into an operating system that they're using to engage with your brand, other brands is something that increasingly brands need to be doing.
- [04:13]
Sree Rajagopalan
What about measurable value?
- [04:15]
Michael Lacaraza
There's no question that there's more pressure on measurable value now than there has been at any point in my career that I, I can speak of. And whether you're measuring that value in terms of soft metrics like awareness, consideration, preference, or whether you're measuring hard ROI measures because of the explosion and proliferation of data types, there's never been a more intense focus on proving the value and making the business case. For every single marketing activity that you take on as a brand, you as well, right?
- [04:47]
Sree Rajagopalan
The same two things. Consumers are everything to you guys. And in a world where they expect both meaning and measurable value, how do you think about that?
- [04:59]
Peter Vs Bond
We think about it on a couple of different dimensions. And first, I fully align with Mike's assessment of the meaning of a brand is still the meaning of a brand. And what has changed is the expectation for how you deliver that. And the first lens that we think about through is what's the experience that you're delivering, what's expected by your customers. So we have both a physical channel delivery in the form of humans and a Virtual channel delivery apps, mobile, you know, mobile, web and so forth. And getting that combination of those things is really critically important. It's interesting because there's a lot of maybe perspective that in financial services and baking that no one goes to branches anymore or cares about having retail branches. It's actually not the case. People want to have that physical connection, especially for getting advice that might be a little bit more complex. And then I think the second way I think about it from a, from a marketer perspective is how you tell your story in the most compelling way that explains through the customer experience how you're going to deliver that value is foundational to building and maintaining a strong brand.
- [06:19]
Sree Rajagopalan
No, no, can. You know, I find myself at a physical branch at least once a quarter for something that I actually cannot do in the app or in an online mechanism.
- [06:30]
Mike Barrett
Sree. I went to a bank branch last week to get a stack of $2 bills. I can't do it anywhere else.
- [06:36]
Sree Rajagopalan
You got to tell the story, though. Why two dollar bills?
- [06:38]
Mike Barrett
Oh, because they're just great to give out as tips wherever you go. Because you always remember, oh yeah, somebody gave me a $2 bill. They're great to hang out.
- [06:47]
Peter Vs Bond
Yeah, that's fun. I once had a friend in college and at his wedding, he threw a stack of $2 bills out into the crowd for everybody to scramble and get off the floor.
- [07:00]
Mike Barrett
I love that. That's a great story, Mike. This is, by the way, to both Michael and Mike. Thank you for joining us today. We're really excited to have you on the podcast. Mike, my question to you is how do you balance emotional storytelling with performance pressures in your respective industries?
- [07:18]
Michael Lacaraza
So I think that the, the balance between emotional storytelling and performance is sort of a false dichotomy. I think that the best performing stuff is the stuff that generates an emotional reaction.
- [07:33]
Mike Barrett
That is an integral component of building loyalty.
- [07:36]
Michael Lacaraza
There's no question that it's not just building loyalty, but it's also building openness to becoming a customer when you enter the buying window.
- [07:47]
Mike Barrett
Okay, so the point of market entry, so to speak.
- [07:50]
Michael Lacaraza
So particularly in high consideration categories, consumers get overwhelmed by rational information. And when human beings have an overwhelming amount of rational information, they make emotional decisions. That's just what they do. And so the role of emotional storytelling is to get people comfortable with the brand. That's how we see it. Working across really high consideration categories like financial services, like automotive, where a consumer may not have the time and energy to drill into every single rational proof point that goes into the choice of a car. Or the choice of a bank. But what they can decide is who they feel comfortable with, who they trust, who they like. And those things become really, really important in driving performance. Very good.
- [08:45]
Sree Rajagopalan
Michael, I want to ask you that exact same question. Emotional, because again, high consideration, selecting a bank, developing a relationship, hopefully lifelong relationship with y'. All. Emotional storytelling has got to be a very big part of what you do.
- [09:02]
Peter Vs Bond
100%. That's 100% accurate. You know, when we think about our category broadly that it's easy for brands and you see examples of this where we might just focus on the product features and the benefits and that's super important to be able to communicate. But what's underneath it all is it's the emotional relationship that people have with their money that's behind the choice. And so if you find yourself able to get in and communicate how you're going to help people have a healthy relationship with their money and that you're the trusted choice for them and that you have the right mix of products and services to enable that, you've got a huge win.
- [09:50]
Sree Rajagopalan
And then so let's say the emotional storytelling starts with hey, how do you have a healthy relationship with your money? And then the consumer decides to become a friend of the bank, actually opens an account, multiple accounts, you know, develops a relationship. You continue that story over the course of the partnership that hey, having a healthy relationship with money is important as they continue to do business with you. Or is it a one and done?
- [10:17]
Peter Vs Bond
No, it's for us it's a long term endeavor and our business works best when clients stay with us for lifetime. A lifetime for sure. Right. And if you can start that relationship early, even as a student or even maybe as a teenager and they're part of their parents account and they can evolve into adults in their careers, that's where the lifetime value of that relationship for us is really powerful and important. When we think about how we do that, one big part for us is we have a lot of data and knowledge about our customers financial lives. And the expectation now is that we're going to do something with that that's of value and we're going to provide advice in the right moment, we're going to offer up the right products.
- [11:09]
Mike Barrett
That's the value equation in the consumer's mind.
- [11:11]
Peter Vs Bond
That's right, that's right. And so it may take the form of tools that we have in our mobile app to help someone budget or help someone plan or to understand their cash flow, or it may be advice during a life event, a marriage Or a wedding, a child's wedding, or saving for college for their children. How awesome.
- [11:35]
Sree Rajagopalan
So to both of you, if you could imagine this awesome co branded campaign between Supergood and US bank, what would it look like? Oh, wait, wait, wait. I think we already have one. It's called the Power of us. Did I get that right?
- [11:50]
Peter Vs Bond
That's right.
- [11:51]
Sree Rajagopalan
So let's learn all about the power of us. Michael, I'll ask you first, what is the power of us with the lens of a brand US Bank? And then, Mike, I'd love to come back to you. How did this formulate? How did you help design this for U.S. bank and play it out into the marketplace?
- [12:08]
Peter Vs Bond
Right, so the essence of it is our brand purpose, which is all around empowerment, empowering human potential and through the lens of their financial lives. And for what we do, yes, we sell credit cards to people or we, you know, we have checking accounts and so forth, but we have a broader responsibility to the financial system for what we, for what we enable in communities and in economic development. So our purpose is much, much bigger than just, you know, selling products and services and it lives at a really emotional core as well. And so part of what we asked Supergood to help us with is what's the right kind of framework for how we would tell that story of empowerment through the lens of our products and services and what we deliver? And then second, sorry, one other thing I was just going to mention is we're position wise. We're not as well known as the, the, the really big brands, the really big banking brands, but we're more well known than say the regional banks. We're kind of a super regional, we're kind of positioned in the middle. So how can we then get more resonance with our brand to separate us from, you know, maybe what our economically pure banks are?
- [13:41]
Sree Rajagopalan
Well, I've personally known you guys forever because my mortgage is with you guys and I also have credit cards from U.S. bank. But the word, the power of us, what does that mean?
- [13:51]
Peter Vs Bond
Yeah, the power of us fundamentally is how we as US bank work side by side with the customer to enable their success.
- [14:02]
Michael Lacaraza
Yeah, got it.
- [14:03]
Sree Rajagopalan
And then agency side, tell us, how did this come to bear? How did you all formulate this? How did you all actually partner with US bank to bring it out into the marketplace and then does it live on?
- [14:16]
Michael Lacaraza
Sure. So we started from the positioning of powering potential. That was where we started from. And we also knew that it was really important to tell the story of the bank, the parent brand, through the lens of the products. So to get really specific about how the bank powers potential in the communities and in the areas that Michael was talking about. And so that's where we started from, from a strategic perspective, from a sort of advertising strategy perspective. We recognized immediately that U.S. bank had assets that almost no one else in the category had. The name the shield, the opportunity to build memory structures in the audience that would, as Michael was saying, separate them from their peers and separate them from, you know, the more massive national players like the chases of the world. And so it was taking those two things and putting them together in one campaign that landed us on the power of us. And we knew that we needed a sort of mnemonic strategy that there was, there was not going to be that every dollar that U.S. bank spent had to work, you know, two, three, four times as hard as every dollar that Chase or, you know, Citi or Bank of America spent. And so we focused really hard on a mnemonic strategy that built memory structures that brought the positioning to life through the lens of the service lines. How the bank actually impacted the communities that it, you know, hidden in what.
- [16:10]
Sree Rajagopalan
You said right there is a little bit of a master class about designing a campaign. Peter and I probably in the post show notes will get into it a whole lot, a whole lot further. I'd love for you also to tell us how do you see this living on in the future?
- [16:24]
Michael Lacaraza
Ideally this is the type of campaign that can live in my opinion, ultimately it's Michael's call, can live forever. I don't believe that campaign ideas wear out. I don't believe that top level campaign ideas wear out. I think if you look at the historically great campaigns, they just go on forever and you know, they trigger consumers, right?
- [16:47]
Mike Barrett
There's, there's an element of nostalgia, there's an element of trust. And of course that's what you're trying to build.
- [16:53]
Michael Lacaraza
Fundamentally what you're trying to do is prepare the market for when the consumer enters the buying window so that they think of your brand as they enter the window, when they're open to switching banks or they're open to.
- [17:07]
Mike Barrett
So the consideration set they're.
- [17:09]
Michael Lacaraza
And they're entering the consideration set. And you know, I think one of the things that's true about advertising is that it is really well understood how advertising works academically and extremely poorly applied by the industry. And I think if you apply some of the basic foundational academic understandings of how advertising works, consistency matters, you know, be clear about what you're selling and how it solves a problem. That people actually care about. Make it easy to remember. Don't force people to close the loop or anything like that. Just be really clear. If you apply those things, you can go a long way.
- [17:47]
Sree Rajagopalan
Remember I just said literally two minutes ago, a little bit of a masterclass. The word that comes to my mind or the sentence is to get a campaign right. It's not that hard. It's back to basics. All the things you just said. If you remember that with consistency, you're going to get it right.
- [18:03]
Michael Lacaraza
What I always compare it to is it's like running a marathon. It's not hard to figure out how to do it. All you got to do is put one foot in front of another for 26 miles.
- [18:13]
Peter Vs Bond
It's not said.
- [18:14]
Sree Rajagopalan
Indeed.
- [18:14]
Mike Barrett
Actually I think there's another 2/10 of.
- [18:16]
Michael Lacaraza
A mile because if you get to.
- [18:18]
Mike Barrett
26, I don't think you quite cross the finish line.
- [18:21]
Michael Lacaraza
It's not that hard to figure out what you have to do. It's just actually it's a little bit.
- [18:26]
Sree Rajagopalan
Of a reminder to the CPG industry the way we fuss about campaigns and.
- [18:30]
Mike Barrett
Oh my goodness, the back to base.
- [18:34]
Sree Rajagopalan
It's about the outcome.
- [18:35]
Mike Barrett
Michael, this is for you. Love to hear your thought on significant shifts you're seeing in consumers purchasing or making financial decisions. And how's U.S. bank adapting to some of these, these changing trends, especially the.
- [18:52]
Sree Rajagopalan
Crazy times we live in. Inflation is the fear of the day go as it comes. And plus tariffs new in the mix. I mean you guys surely must be seeing impacts.
- [19:01]
Peter Vs Bond
There's certainly a lot of uncertainty about how the economic situation is going to land most of the financial institutions. The bigger banks are not seeing significant shifts in behavior in the US People are still spending, they're still doing what they need to do. But there's maybe a little bit more of a cautious mindset on it. And we're not a business that is directly impacted by tariffs as we don't have like sort of the supply chain production type of manufacturing thing. But, but certainly if there's, you know, if there's upward pressure on inflation and you know, those types of outcomes, then they will, they will put pressure on the consumer and on businesses for how they allocate capital, how they hire and so forth. But so far we're not seeing like significant shifts in that in terms of what's been publicly reported. What's interesting too about your question is there's a component of it that just hasn't changed, that people really want great advice and they want a fantastic customer experience. They want to manage their money. Well, the choices that people are making are different now too. When you're in a higher interest rate environment now, things like CDs and money market accounts and you're getting interest on your money where it used to be, kind of it was zero.
- [20:24]
Sree Rajagopalan
Hasn't happened in a long time for.
- [20:25]
Peter Vs Bond
Quite a long time. See money flow shifts into money market funds and those types of things. In terms of how the asset classes play out and we have to be there to service that and accommodate that. I would say what's happening that has a big impact on marketers, not just financial services, is the way people are starting to shop now. Using the answer engines as ways of getting at questions is pretty big, right?
- [20:56]
Mike Barrett
It's a pretty big contextual from it is we talk in CPG about what made marketplaces like Amazon very successful is a very spear phishing mentality. You go, you enter in a product and it gives you that product. Now people are getting a customer. I've heard wholesale changes in people actually using AI engines like ChatGPT as their primary search engine. And that's now providing contextual, what we would call moving search from being very vertically focused to being very horizontally focused. Like why don't we go into a grocery. Why do we always go to a grocery store to shop for a 4th of July party? Because they set up a nice 4th of July section with all the products there. If we tried to do that in a traditional search engine, we'd be sitting there adding items to basket for it's not worth it. But now we can change that saying I'm throwing a fourth of July party, give me all the products I need.
- [21:55]
Peter Vs Bond
That's a great metaphor for it. And so a couple examples that come to mind the customer experience. People would go to Google search and then they would say, okay, well here's a series of links. Now I've got to go hunt and find the answers. And instead the answer engines are summarizing it oftentimes with a lot of depth and knowledge. And so you get the answer that you need and you don't need to go hunt all through the different sites that Google has decided to weight as important. And I'll show you a little bit of insight. In our own businesses where we're not seeing in this initial phase traffic declines to our website, to our main core pages, people are still coming to get information and to transaction do what they need to do with us. But there are some like secondary pages where we're not seeing as much traffic. So as an example which Used to be kind of high volume for us. They weren't necessarily important to driving the business, but they served a purpose. So for example, people want to know, how do I get my routing number and account number? And we had a page for that. It was super well optimized and it was on the first page and we got a lot of traffic because people would just go to Google and ask that question. Well, now they're getting that answer from the search from the displayed right in the results. Right in the results.
- [23:13]
Mike Barrett
So they don't have to click.
- [23:14]
Peter Vs Bond
They don't need to click.
- [23:15]
Mike Barrett
They've got the information.
- [23:16]
Peter Vs Bond
That's right. They don't need to click to come to our site. And that's okay. Yeah. As long as they're getting the answer that they need to do to do business with us, then we're okay with that.
- [23:25]
Mike Barrett
That is awesome.
- [23:26]
Sree Rajagopalan
I am tempted to ask you, Mike, a little bit of an offshoot of the question we asked Michael on the consumer shifts. As an agency, are you studying consumer shifts, demographics habits, purchasing habits, all the time. Is it a few times a year? Like how do you stay abreast of this?
- [23:45]
Michael Lacaraza
It is the most important thing we do. I mean our role is to connect brands with consumers. And we can't do that unless we understand consumers and we understand brands. We have a number of different ways that we do it. The way that is most persistent and that we get the most traction, both with our internal teams and with our clients is we, we create consumers out of data. So we have a massive data set with tens of millions of data points on hundreds of thousands of consumers in the US and we animate different consumer segments using AI so that you can just talk to them. And so we talk to synthetic representations of audiences all day long, every day. When you come to work at our shop and you log in, one of the things that you can do the first time you log in is fire up an audience insights engine and just start talking to people. You can talk to, you know, the young, affluent, mass affluent, high affluent, Target for, for U.S. bank. You can talk to a representation of them that's data's refreshed weekly. So we're able to talk to them about things that are happening. We're able to talk to them about some of the stuff you were talking about earlier. What's the impact of interest rates? What would it take to actually move you?
- [25:11]
Sree Rajagopalan
So it's like a live focus group.
- [25:13]
Michael Lacaraza
It is like a long term, ongoing focus group conversation that you can just have whenever you want. You can show them ads and ask them what they think. You can show them competitive ads and ask them what they think about those. You can ask them about the relative likelihood of, of moving based on what they're seeing. Fundamentally, we are always trying to answer some very specific questions about consumers. Who are the most, who are the best ones for a particular client? How do they make decisions? How can we influence those decisions? And understanding everything that's going on in their lives helps us answer those questions. Of course, we do more than just synthetic representations of audiences. We're always staying on top of consumer trends. But it is the most important, important.
- [26:00]
Peter Vs Bond
Thing that we do.
- [26:01]
Sree Rajagopalan
Let me remind our audience that we're speaking with Mike Barrett, co founder and Chief Strategy Officer at Supergood, and also with Michael La Carraza, CMO of US Bank. Now, I want to come back to what you had just spoken to with AI. AI in the industry has some great outcomes. We're already seeing. Both you and Peter have already given examples. AI also has a notorious reputation now for deep fakes. And the word I want to use is the trust component. So let me ask you first, but I would love to hear an agency perspective as well. How does trust play a role in the brand narrative for U.S. bank? And then how do you earn it? How do you maintain it? All of that. And then given that we have such a large brand audience who are also encountering AI every single day, what is your advice on AI? How does that trust get created? But first, let's hear what does that word trust mean to a financial institution?
- [27:04]
Peter Vs Bond
It's core and foundational to everything. Warren Buffett once had a quote that it can take you 30 years to build a reputation when you can lose it in 30 minutes. At the core, if you're doing business with a bank, you have to trust the bank to take care of your money and to take care of your needs. So it comes in several forms. The first is the data that we have on our clients has to be kept really pristine and protected. There are bad actors in the world that are constantly trying to scam people and steal their money, right? So we play a role in helping inform our clients on how to avoid those kinds of situations, Right. Because it's often kind of user initiated when these scams happen, right? They're not hacking into our systems, they're doing it kind of social engineering and so forth. And then I think it's just how you live it. You know, if you have the customer front and center and your values are customer centric, and every day you're making decisions that are about doing the right thing, then you should get the trust back because you're doing the right thing.
- [28:28]
Sree Rajagopalan
Understood. And the word AI, is that a scary thing? Or at this point have you said I have to adopt it and figure out how to make it work?
- [28:41]
Mike Barrett
Chain Drug Review's focus is on reaching the key decision makers across all retail channels, delivering comprehensive coverage of the latest shopping trends and in depth category analysis on health, beauty, over the counter products and wellness. Whether it's the latest trends, emerging technologies or strategies for adapting to new consumer behaviors, mass market retailers deliver the critical information retailers need to navigate the this dynamic environment. To subscribe to the newsletters of CDR and mmr, simply follow the hyperlinks in the digital liner notes of this episode. Chain Drug Review and Mass Market Retailers are published by Retail Media iq.
- [29:24]
Peter Vs Bond
It's, it's not, I don't think that see it as a scary thing so much. It is definitely a disruptor and no one, no one has the answers for how it should be incorporated into your business, into your customer experience. Experience. Every marketer, every company is at maybe a different stage of development. Some are more ahead, some are more behind. We're in a stage where we've outlined where we think the big use cases are for us within say the marketing analytics space around automation, content creation, acceleration, insights and customer experience. One example is you can now, we can now near real time understand what's happening in a phone call with the customer. Have the AI do that analysis instead of relying on surveys and that gives us insight to go back and improve the customer experience or maybe even predict why someone's contacting you.
- [30:26]
Sree Rajagopalan
As an agency, what does that word mean to you?
- [30:29]
Michael Lacaraza
AI Opportunity. It is the we are an AI native agency. It's at the core of our business. And I think what is important for us to communicate about AI first and foremost is that it is in no way shape or form enough. AI is great. AI is relatively evenly distributed now, but it will be even more evenly distributed in the future. And you know what matters more than AI to us is our data strategy. If you look at how we invest our money, we invest 4 to 1 data to AI. What matters more than our data strategy is the people that are using it. AI we see as a tool set. And it's a tool set that's going to be used by people. It's going to be used to work faster and more effectively just as other forms of technology have allowed us to work faster and more effectively. It's not magic, it is disruptive. And what I tell particularly the young people who work at Supergood is there's an analog for what's happening on the creative side right now. And it's what happened on the media side during the shift to programmatic. So I was working on the media side when media buying shifted completely to programmatic. And yes, there was a technical disruption and yes, there was a whole bunch of business model disruption. But what there also was for younger people was an opportunity to just jump rungs on the career ladder. If you embrace it and you make change work for you rather than against you, it is an amazing time to be doing what we do.
- [32:17]
Mike Barrett
Michael, I'll tell you five years ago when we started this podcast and SRI chose to part with me. Dear Warren Buffett comment, he lost about 95% of his audience trust. We've been working for the last five years to help him recoup it. But that's okay. Stick with me. We'll get you back up there.
- [32:36]
Sree Rajagopalan
Street the Dodgers fans always try to be wise. 27 championships we talk.
- [32:41]
Mike Barrett
But we're the reigning World Series champions.
- [32:43]
Peter Vs Bond
Reigning World Series champions.
- [32:45]
Sree Rajagopalan
That's like saying Brady's.
- [32:46]
Mike Barrett
No crying in baseball. Street Playing a baseball. Michael would love for you to share advice to our audience of CPG professionals about what they can learn from financial services around loyalty and long term customer value, which seems to be the core component of the financial services sector.
- [33:17]
Peter Vs Bond
It's a really interesting question. I think of CPG companies as being historically on the forefront of marketing and understanding customers and insights and measurements and loyalty and which segments are most important to go after. So there's a lot of similarity for us. Is is making the priory decision of where you want to focus your investment, which segments matter to you?
- [33:46]
Sree Rajagopalan
Okay.
- [33:48]
Peter Vs Bond
And that's if you're. If you're able to do some math and quantify the economic value of the various segments, it helps you make some of those decisions with a lot more confidence.
- [34:01]
Mike Barrett
Okay.
- [34:03]
Sree Rajagopalan
For both of you. Roi, significant pressure for short term roi, short term metrics. Tell me tomorrow morning how my campaign is doing. It's a world right now of brand marketing because of the data availability that you already spoke to Mike. Where the ask is give me the metrics instantly. So what are Those go to KPIs that you as an agency make available to U.S. bank. And then what are those? Go to KPIs. Maybe we'll start with you. What do you feel? Are those KPIs that would make you feel that as an ad is placed and a campaign is placed out there, it's actually delivering on the money for you.
- [34:43]
Peter Vs Bond
There are layers to the measurement and some aspects of what you do that may be more performance marketing, direct marketing, have a bit more deterministic way like impressions clicks. Well, so what I would say is like impressions clicks are more kind of operational. They're not KPIs for us. So for us it would be say on the retail side of what we do, it's accounts and balances. And so it's both a combination of the volume and the quality of the new clients that you're bringing in. For existing clients it's, you know, how we are deepening those relationships. Are we serving across a broader set of needs? Those are kind of the big outcomes. And then you know, we have economic values associated, attached to, to different types of relationships. Right. So that's at the core. And then we have tools like a media mix model that can measure or estimate best estimate of the economic value of brand investments that don't have the same kind of linear connection point into the behavior. So the layers of it are typically like for us, the performance and product marketing. And when you've got affiliates and search and those kinds of things that are more, you can see the behavior more directly, you can measure those more directly. And then for the mass market type of investments, you need to model that and you need to be able to kind of trust it to help you make the decisions about your investments.
- [36:11]
Mike Barrett
Double clicking down on that because you brought up marketing mix modeling. Do you think about this concept of multi touch attribution and what are the right points on the journey that will drive to the ultimate outcome, outcome of building that long term relationship and how do you approach that?
- [36:28]
Peter Vs Bond
Yeah, and it's funny because as I've lived through this, I've worked over the years with multiple different kind of the last touch attribution, multi touch me and mix model, all these kinds of things. Right. And what I found is that they each have a series of trade offs. Some are more effective than others depending on the category. There's no one bullet, there is no silver bullet. You need a combination of things. So in our case, I think, you know, we have sort of the more lower, lower funnel performance metrics, type or performance, you know, investments where we can get a really more deterministic view. Like say if you're doing direct mail, you have control cells, you know what the lift is like, you get a really good sense of how that's performing. And then, and then more for the upper funnel where sort of the Media mix model piece comes into play and then the other pieces that a lot of marketers forget sometimes is that you have to be doing constant experimentation to train these testing and learning because it's never a set it and forget it and then the model will just keep.
- [37:34]
Mike Barrett
It's not a Ron Popeel oven.
- [37:35]
Peter Vs Bond
No, right, exactly. It's not a, you know, shake and bake or whatever. Like you have to keep, you have to keep learning and experimenting and match market tests and that type of thing.
- [37:48]
Sree Rajagopalan
In order to, to get the insights then agency perspective. KPIs, where do you go first?
- [37:55]
Michael Lacaraza
KPIs are always client dependent. So there is no like one size fits all. And it's also, it's client dependent in terms of the KPIs the client needs and it's also client dependent in terms of the KPIs the client wants from the agency. So most clients over the years, and in particular, you know, most larger clients have migrated to a model where their first party data stack is the best data, period, full stop. And so what we find ourselves in a position of doing is being ready to give clients a full funnel measurement of everything that we're doing. But what we wind up doing mostly is using those to drive hypotheses that we then go and test and market or to fill in the blanks if for some reason they don't have a specific set of data or something like that. But generally speaking, what we use our data for is generating hypotheses, generating ideas that we then go and that we then bring to clients and say, you know, hey, what do you think about this? And we'll use their data as the, as the data of record to optimize the campaign from, or to make decisions.
- [39:07]
Peter Vs Bond
From, you know, to build on that. Just one other point is, is one of the things that I learned over the years through my kind of career marketing, different categories and so forth, is a huge part of your success is how you partner or how you work with your business partners that you're serving at the end of the day and the language that you use and the metrics that you use and those outcomes need to be aligned. And so that's why for us, the business metrics is where we start. And a lot of marketers maybe will see the world kind of through their lens on like the behavioral indicators like clicks and views and look at how many impressions we got and you know, the business.
- [39:51]
Sree Rajagopalan
But you already called that operation.
- [39:53]
Peter Vs Bond
Yeah, yeah, they're sort of operational and the business of the business, if you Lead with that type of, that language, the business kind of looks at you like you're from Mars. But if you lead with like here is the economic value of what it's producing for you and why, and here's what your investments are getting you. Now you've got a shot. Right now you've got a partnership.
- [40:12]
Mike Barrett
So my latest trend obsession is understanding doom scrolling and people just swiping through all theirs. That's mine because it's just so fascinating to me is how you break through and get a message when people only give you maybe eight seconds if you're lucky. Love to hear from each of you. I'll start with, with Mike, what trend is most intriguing to you right now in consumer behavior, in marketing technology or creative culture? What's kind of got your attention?
- [40:48]
Michael Lacaraza
That's a really, really good one. I am going to go with the wholesale shift from search engine based search to LLM based search. I think it's so interesting. I think it's the most transformative thing right now. I also think that the conversations that people are having with LLMs are really, really interesting. You know, I.
- [41:19]
Mike Barrett
Using it for therapy.
- [41:21]
Michael Lacaraza
Yeah. Or for long form conversations about ideas. I think it's really, really fascinating and I think it's going to be transformational in a way that we're just starting to grapple with. I mean, obviously the businesses that have been built over the years on SEO and SEM are going to have to be at some point rethought. I'm not saying I have any answers for how they need to be rethought, but I do think that we need to start from figuring that out. But I think that consumer behavior of having human conversations with artificial intelligence is arguably the most interesting thing happening right now.
- [42:04]
Mike Barrett
Mike, I was at a conference in Palm beach last week. There were about 150 people in the audience. I was moderating a panel and I asked the audience, how many of you are using LLMs, using chat GPT or whatever as your primary search engine? Over half the audience stuck their hand up. Yeah, that is just amazing.
- [42:24]
Michael Lacaraza
I was talking to a buddy last night who runs an agency and he has, he was, he was showing me he has an ongoing voice conversation with Chat GPT. He has a relationship about his, it's about the business. It's learning upon itself and he's just, he's just talking to it about what's going on. So he goes, every morning he goes for a walk and he has a conversation with it about what's going on in his business. And he was like, it's like 20% usable stuff. But otherwise, I'm just, what, listening to music like this is a good way. It's more productive. Yeah. To be productive. I just think it's really interesting.
- [43:03]
Mike Barrett
Phenomenal, Michael, to you.
- [43:05]
Peter Vs Bond
Yeah. It's hard to top that one. That was a good one, right? Well, maybe somewhat relatedly, as. As we think about the younger generations and having a. Having a Gen Z, you know, kid in our household, we live this firsthand, and it's just. I think it's nothing short of addiction to the phone.
- [43:26]
Mike Barrett
Yeah.
- [43:27]
Peter Vs Bond
And these, you know, these kids have their nose in their phone, and they.
- [43:32]
Mike Barrett
Don'T leave the room without their phone.
- [43:34]
Peter Vs Bond
They just don't. And, you know, we have a rule in our household. No phones at the dinner table. We were going to have a conversation and, you know, if my son has his phone in his pocket and we're at the dinner table three or four times, he will pull it out. Yeah. He'll get pings and he'll. He just. It's like a. It's like a reflex. They just have to do it. And certainly there are communities and they're with their friends and they're doing. But some of it's just that. That death scroll that you're talking about.
- [44:02]
Mike Barrett
It'S so hard that we were accustomed not to doing that. And now there's this. There's this culture, particularly among professionals that are very young, that if you have to respond to a message immediately, like, you can't block your time to just deal with things. They want an immediate response.
- [44:20]
Sree Rajagopalan
It's the attention economy. That's the way I think of it.
- [44:22]
Peter Vs Bond
Yeah, but then. But do they respond to the messages that are actually important now?
- [44:26]
Mike Barrett
No. That's the problem. My kids don't. Everything that's. Let me prioritize, and I'm not going to do it.
- [44:33]
Sree Rajagopalan
They'll respond to me when they want to respond, not, not if it's important.
- [44:36]
Peter Vs Bond
That's right.
- [44:37]
Sree Rajagopalan
But, gentlemen, busy conference. You both have a lot going on. Thanks for making time for the CPG guys and joining us today. I did not expect the conversation to go this way. There's a lot of masterclass stuff you both have dropped that the CPG industry can learn from. Thank you to both of you for joining us today.
- [44:53]
Michael Lacaraza
Thank you.
- [44:54]
Peter Vs Bond
Thank you, guys.
- [45:01]
Sree Rajagopalan
Foreign.
- [45:07]
Mike Barrett
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