Brand isn't dead, the 95:5 rule & why AI is B2B's most powerful painkiller - Jon Lombardo and Peter Weinberg

Summary

Podcast Summary: Uncensored CMO – "Brand Isn't Dead, the 95:5 Rule & Why AI is B2B's Most Powerful Painkiller"

Release Date: June 11, 2025
Host: Jon Evans
Guests: John and Peter from Evidenza, Scott Galloway

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Introduction

In this engaging episode of Uncensored CMO, host Jon Evans welcomes returning guests John and Peter from Evidenza. The trio delves deep into three pivotal topics: the controversial assertion by Scott Galloway that "the era of brand is dead," the influential Ehrenberg Bass Institute's 95:5 Rule, and the transformative role of Artificial Intelligence (AI) in B2B marketing. Throughout the conversation, the guests provide insightful analysis, backed by empirical data, challenging prevailing marketing narratives and showcasing how AI is revolutionizing market research.

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Scott Galloway's Claim: "The Era of Brand is Dead"

The discussion kicks off with Scott Galloway's provocative statement that branding has become obsolete. John and Peter vehemently disagree, presenting compelling counterarguments based on data and real-world examples.

• John criticizes Galloway's marketing insights, stating, “His marketing advice, it's some of the worst marketing advice that money can buy. You know, almost everything he said was just, like, demonstrably untrue” ([09:07]).

• Peter emphasizes the importance of distinctiveness, noting, “You have to find an unfair way to compete... building your brand around distinctive assets” ([07:47]).

• Scott Galloway defends his stance by labeling himself an "attention merchant," arguing that polarizing opinions generate buzz and keep the conversation alive ([10:59]).

The guests highlight how established brands like Amazon continue to invest heavily in advertising, directly contradicting Galloway's claims. They assert that branding remains a crucial element in securing market share and consumer trust.

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The 95:5 Rule in Marketing

Central to the conversation is the 95:5 Rule, a concept from the Ehrenberg Bass Institute that posits only 5% of the market is actively in the buying phase for a given category at any time.

• Peter introduces the rule by explaining its significance in targeting future buyers rather than just the current 5% in-market consumers ([22:06]).

• John elaborates, “My creative is to create a memory that will be recalled in the future when someone goes in market” ([22:06]).

This rule shifts the marketing focus from immediate conversions to long-term brand building, emphasizing mental and physical availability. The guests discuss how adhering to this rule aligns marketing strategies with the natural purchasing behaviors of consumers, ensuring sustained business growth.

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AI as B2B Marketers' Most Powerful Painkiller

A significant portion of the episode is dedicated to exploring how AI, particularly Evidenza's advancements, is transforming market research in B2B sectors.

• John explains Evidenza's capability to generate synthetic data, allowing marketers to conduct extensive market research efficiently: “You can create a thousand permutations of a CEO who buys ERP software... much more cost-effectively than traditional methods” ([31:05]).

• Peter highlights the flexibility and depth AI brings to research, enabling real-time analysis and dynamic insights that were previously unattainable ([48:12]).

• Scott Galloway praises the integration of AI in reducing traditional research barriers: “The Internet is basically the world's biggest market research study... the voice of customer is now accessible like never before” ([43:24], [38:40]).

The trio discusses how AI empowers B2B marketers to gain deeper customer insights, enhance segmentation, and maximize marketing effectiveness, positioning AI not just as a tool for automation but as a strategic asset for informed decision-making.

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Case Studies and Data Insights

John and Peter present empirical data supporting their arguments, particularly focusing on how different categories adhere to the 95:5 rule.

• John references their research across 20 categories, revealing varying purchase frequencies and reinforcing the necessity of brand investment: “We have 10 B2C categories and 10 B2B categories... it's a lot of it should be brand because most people are just not buying” ([34:02]).

• Peter shares a specific case with Lucozade, illustrating how understanding purchase frequency can inform long-term marketing campaigns: “It came out to them, okay, fine... this is like a four-year campaign” ([36:24]).

These insights underscore the importance of tailored marketing strategies based on category-specific behaviors, advocating for sustained brand presence to capture future market opportunities.

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Future of Marketing with AI

Looking ahead, the guests discuss the evolving landscape of AI in marketing and its potential to further enhance marketing strategies.

• John anticipates AI's role in providing timely insights and personalized research, making every marketing decision data-driven: “You can have every single marketing decision informed by some sort of quantitative research” ([45:12]).

• Peter envisions AI enabling marketers to conduct on-demand research, similar to interactive elements in television shows: “Focus group on demand, Customer on demand. Quantitative research on demand” ([46:09]).

• Scott Galloway emphasizes the qualitative improvements AI brings, stating, “We know our employees' time better than we've ever. And the downside is you have to manage data...” ([43:24]).

The conversation highlights a future where AI not only streamlines traditional marketing tasks but also innovates new methods for engaging with and understanding customers, ensuring that brands remain relevant and resilient in a rapidly changing market.

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Conclusion

The episode wraps up on an optimistic note, reaffirming that branding is far from dead and that AI is poised to enhance, rather than replace, human-driven marketing strategies. John and Peter celebrate their first-year milestone with Evidenza, acknowledging the pivotal role AI plays in democratizing access to high-quality market research. They confidently state, “Brands will never die. I don't think marketers will ever die either.” ([62:30]).

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Notable Quotes

• John: “His marketing advice, it's some of the worst marketing advice that money can buy... almost everything he said was just, like, demonstrably untrue.” ([09:07])

• Peter: “You have to find an unfair way to compete... building your brand around distinctive assets.” ([07:47])

• Scott Galloway: “We're in an attention economy, so you need a device that cuts through and gets attention.” ([06:41])

• John: “If you reach them at the wrong time, assuming they're a category buyer, you'll then have the chance to sell to them at the right time.” ([25:47])

• Peter: “Nobody uses characters, but characters are wildly effective... very similar to the character idea.” ([40:32])

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Key Takeaways

1. Branding Remains Crucial: Contrary to claims that branding is obsolete, it continues to be a vital component for both large and small brands, providing a competitive edge through distinctiveness and memorability.

2. The 95:5 Rule: Focusing marketing efforts on influencing the 95% of future buyers rather than just the immediate 5% in-market consumers ensures long-term brand growth and sustainability.

3. AI Revolutionizes Market Research: AI enables marketers to conduct extensive, cost-effective, and real-time market research, transforming traditional methods and unlocking new opportunities for data-driven decision-making.

4. Empirical Insights Over Anecdotes: Data-backed strategies and empirical research are essential for effective marketing, challenging anecdotal approaches that may lead to flawed strategies.

5. Future of Marketing: The integration of AI will not only enhance existing marketing practices but also pioneer new methodologies, ensuring that brands remain relevant and can adapt to evolving market dynamics.

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This episode of Uncensored CMO offers a rich blend of critical analysis, empirical data, and forward-thinking insights, making it an invaluable resource for marketers seeking to understand the enduring importance of branding and the transformative potential of AI in the B2B landscape.

Transcript

[John]

Foreign.

[Peter]

Gentlemen, welcome back to the uncensored cmo. Now we have some returning guests in this episode, none other than John and Peter from Evidenza. Now you will discover in this episode their new fluent device. They're turning up in character. I might even participate in that as well. But we're here to talk about a few things. We are going to respond to Scott Galloway's rather contentious claim that the era of brand is dead with. We have a few points of view on that, which you'll discover in a second. Talking about the 95. 5 rule, which I think is one of the most profound, most important rules in all of marketing at the moment. And of course, given that they run an exciting AI company in marketing, what can AI do for marketers? And specifically, how can AI inform us informed marketing decisions and give us access to market data quickly and more effectively? John and Peter, as always, are very entertaining. And in this episode, they don't disappoint. Here we go. John and Peter from Evidence. Welcome back, chaps.

[John]

Delighted to be here and lovely to see you.

[Scott Galloway]

John, something's different about you. What is it?

[Peter]

I don't know.

[Scott Galloway]

Did you get a haircut?

[Peter]

I didn't get. Well, I mean, Scott Galloway said he liked my hair, but now you haven't.

[John]

Changed it since, or you've been getting haircuts every day.

[Peter]

So, yeah, just explain what you two are wearing at this moment.

[John]

Well, why don't you tell. What do you see? What do you think we're wearing?

[Peter]

Right, well, I see. I see. Sort of got a bit of court jester vibe going on here, which I think is probably in keeping with maybe some Italian Renaissance painter vibes somewhere in that territory. A bit of green and gold, maybe some soft, muted sort of cardboard tones, sort of, you know, we call it bone.

[Scott Galloway]

Bone is bone.

[John]

Bone is the hex code. Do you have a hex code, John?

[Scott Galloway]

It's X5.8.

[John]

X58734.

[Peter]

You know it. Do you have panto in the US now? He's just thrown out.

[Scott Galloway]

We do Pantone. We have many Pantone. Evidence of Pantone.

[Peter]

Exactly. Well, good to see you On. On. On Brand.

[Scott Galloway]

In brand, John. In brand.

[Peter]

Not just in brand, on brand.

[John]

So brand is a way of life.

[Peter]

How is the hottest new startup in AI in the marketing category going?

[Scott Galloway]

I think it's going pretty well. I think it's unlikely we would show up wearing these beautiful, you know, flowing tunics and plumed berets if it wasn't going well. But I. I think, yeah, we are in brand and we are on brand, but it's been going very well. I mean, we've grown very quickly, which has been great. Learned a lot, made a lot of mistakes, had a bunch of triumphs, and we're here today. And. Yeah, what would you say?

[John]

Mark Andreessen has a great quote, a great one. He has a great. He has a great quote on startups. He says there's only two emotions in a startup, euphoria and terror. I'd say that sounds about right.

[Scott Galloway]

Yeah, that's pretty good, actually.

[John]

It's been great. It's been great. I think we've had more euphoria than terror, as John said. Grown super fast, you know, working with the biggest brands in the world, mostly B2B, but also some huge CPG companies. And it's been an incredible, incredible experience having two very young children and a new business. Just super relaxing. I would describe it as the most relaxing time of my life. If I had to describe it in a certain way.

[Scott Galloway]

It's. I should give Sadie a shout out. Sadie, baby, what's up?

[John]

Sadie loves podcasts, right? Marketing podcasts specifically, particularly. She's four years old.

[Scott Galloway]

She's more of like a marketing AI kind of podcast listener. But she insists that it be in a Renaissance setting with Renaissance garb. So, you know, just kind of. This just appeals to her. Many kind of peculiarities.

[John]

Sadie's also in a rebellious performance marketing phase, I've noticed, which has just been sad to see for John.

[Scott Galloway]

You should see the fights at home so hard.

[Peter]

Just, well, I have to compromise. At least you're living up to your distinctive assets claims as well.

[Scott Galloway]

You know, we are, I think, in many ways, evidence that small brands actually can market like big brands. Like, there's actually a lot of conversation on Twitter. Actually, not Twitter, LinkedIn. Sorry, on LinkedIn. Probably on Twitter too, though, about small brands and how small brands grow, and small brands don't grow in the same way that big brands grow. But actually, I think you can look at us right now. I mean, one thing that I learned very early on, Peter learned very early on, is the power of distinctive assets and the power in particular of characters. And nobody actually is willing to take the risk of actually dressing up as a character. Like we talked about it earlier. Like, you'd have to get so many people to sign off on it at a big company in order to dress up like we do. A small company, you don't have to do that. You can actually follow the data. Everyone says they follow the data. Pay attention to the data. I'd like to think we're actually doing that, like, living it, you know, breathing it, dressing as it.

[John]

Yeah, it's super interesting. I think we've always. If you were to criticize us from our time at LinkedIn and the B2B Institute, you'd say we were just sort of consultants or commentators. It was like, if you believe in this stuff so much, you know, why aren't you running a brand? Why aren't you running real business? Business? And now we are. And I would say we are running the Aaron Brick Bass playbook. I mean, we're monomaniacally focused on mental and physical availability being distinctive, as evidenced by us coming to your podcast dressed in entire Italian Renaissance garb. And to John's point, I. I don't think the playbook of how you grow is different for big brands and small brands. I think it's the Aaron Burg Bass playbook. The difference is just that big brands are too slow and scared to run the playbook in many cases, especially when it comes to distinctiveness. You know, like, products can be copied. But you're not going to see the CEO of, like, Nielsen come on your show wearing a Renaissance costume. I could pretty much guarantee.

[Peter]

I think. I think you're about right. I think the difference is with small brands, you have to move quicker and you have to move more boldly, I think, because big brands have got the benefit of legacy and.

[John]

And reach and scale.

[Peter]

Exactly.

[John]

Right.

[Peter]

You know, they can. Yeah. So you guys have got to, you know, punch above your weight, so to speak.

[John]

Yeah. With creative, especially, you know, you've got it. Your creative's got to be super weird to out to compensate for the fact that you can't, you know, get as much reach in media as a big brand. And Renaissance costumes have been a nice way to do that.

[Scott Galloway]

I mean, you also. The amazing thing is, you know, we put our podcast out as, you know, and, you know, we've gotten a ton of messages, and every single message mentions the costumes.

[John]

So you need your stylist.

[Peter]

Where can I buy one?

[Scott Galloway]

Have the same style.

[John]

What Venetian silks are you wearing? Exactly. We'd be happy to share our Venetian silk dealer with anybody who's links in the bio, links in the link in the podcast.

[Scott Galloway]

But we're in an attention economy, so you need a device that cuts through and gets attention. And actually, we're in a low attention economy because people pay low attention to things. So anybody who sees this episode or sees one of our episodes, they can just scroll through the feed, which is where the majority of Stuff is happening. Majority of attention is. And they don't have to listen, they don't have to watch. They'll know, oh, those are the guys who wear the plumed berets and the beautiful flowing, you know, tunics and they say, sell synthetic research, do marketing, AI. It's kind of what you need to have. Like, I feel like if you don't have that, I'm not sure how you grow today. And you need that as a big brand or a small brand.

[Peter]

Yeah. I mean, to be fair, you're absolutely right. I mean, look at the data. Characters are one the most effective devices, but they're not used very much, are they?

[John]

In B2B, it's less than 1% use characters. I think we did that research with you guys.

[Peter]

Yeah. That's crazy, isn't it? Like, it's brought in the biggest competitive advantages that no one's bothering to use.

[John]

Yeah. And we said that for years. We said it's the biggest arbitrage opportunity in B2B. And then when we started the company, people told us, they're like, so you guys going to have a character? Of course, of course. The first characters are ourselves, as you can see. But over time, I'm sure we'll morph into a. Some sort of Renaissance pocket professor type thing we're playing around with.

[Scott Galloway]

But you have to find, as a small company, you have to find an unfair way to compete. And one of the only unfair ways I can think of to compete is to dress up essentially like Renaissance characters. Because when we would, Peter and I would travel the world and we would talk to all these B2B companies and we would tell them or show them a slide on the effectiveness of characters, you know, uniqueness and fame. They're in the top. Right, right. Top right is all right.

[John]

Show them the Geico Gecko.

[Scott Galloway]

And they would always say the same thing. Right. They'd be like, well, we can't, or that's not serious enough for us. And so nobody will play there. Well, then that creates an opportunity for a small company like us to go play there.

[Peter]

And the other thing that people forget is you can do it for free. Right. It's not life to pay a celebrity to endorse your brand. Like the Duolingo duo. Right. The owl. For free. And they've built a character that's got something like 120 million followers now.

[John]

Yeah. To be clear, the costumes we're wearing were not free. These are the nicest Italian Renaissance costumes that Amazon can buy. You know, it's probably cost it could easily be $100 in merchandise. Huge expenditure.

[Scott Galloway]

It's interesting, you're right. Like, we are creating ip, right. Intangible asset that we own, and we don't have to pay anybody for it. It ought to be a recurring asset for us, a fluent device for us. You know, it ought to create tons of value for us over time and nobody will copy it, even though it's the most obvious thing and it's the thing that they should most copy.

[Peter]

Anyway, so you just started your podcast, and I love the title of your last one, inspired by a conversation that we had between Rory Sutherland and Scott Galloway, where Scott did his usual clickbait thing of the era, brand is Dead. And then the whole of marketing LinkedIn went wild in response. But I thought we should talk about it because actually, I haven't had a chance to talk about it either. So. Yeah. What did you think of what Scott said? Obviously?

[John]

Well, first of all, huge kudos to you for getting Galloway and Rory together. I mean, that was one of the greatest podcast episodes I've ever listened to.

[Scott Galloway]

It's the only time I've ever heard Rory listen and not talk. Quite a feat.

[John]

I couldn't help but notice you didn't get a lot of words.

[Peter]

I'm Josh Jo. It was meant to be. Like, I was meant to be facilitating the debate between them, but the stage.

[John]

Didn'T need to happen.

[Peter]

And I'm like, I'm not even going to say anything. It's impossible with those two to get words. It'd be impossible. Right. But I just thought the idea of alchemy versus, you know, algebra effectively, like, which is the philosophies they both come from, could be really interesting. So I kind of thought, what are two debates that they're going to absolutely disagree over? One was going to be Jaguar rebrand, because I think Rory's got this contrarian view on Jaguar, which I think is quite interesting.

[John]

Yeah, he loves it.

[Peter]

And then obviously, Scott's famous for believing that the era of brand is over. And I thought, well, no one better than Rory to come back at him.

[John]

Yeah, listen, we found it to be quite appalling. I mean, I love Scott Galloway in terms of his life advice. I find it to be very entertaining and charismatic. But his marketing advice, it's some of the worst marketing advice that money can buy. You know, almost everything he said was just, like, demonstrably untrue. And you, in your very polite British way, did a great job pointing that out. You know, he's like, Amazon doesn't advertise you're like, Amazon's the largest advertiser in the world. That he's like, oh no, but it's just their ad business. And then it's like, no, it's not just their ad business, it's their expenditure on advertising. And then he's like, oh no, it's all direct response. And it's like, well, actually it's not all direct response. They're one of the largest TV advertisers in the world, which is not a direct response channel. So he's just kind of like, I notice, I couldn't help but notice on your podcast when he's talking about his life advice and sort of like, what percentage of men go on dates? It's actually very empirical and data driven. When he talk about marketing, suddenly it's just all anecdotes. And I don't remember seeing an Amazon ad. So Amazon doesn't advertise. You know, he doesn't seem to hold marketing to the same empirical standard that he holds like his, you know, invest in the s and P500 type advice.

[Scott Galloway]

Well, he's, he's in the business of attention. He's not in the business of marketing anymore. I think he started in the business of marketing and he had the viral event, you know, one of his classes went viral and he built a big brand. But I mean, he's all about, it's like, think about this. You know, in this conversation, half the, everyone maybe does disagrees with him. But like half the people love them, half the people hate them. 100% of the people talk, everyone's talking about it. You know, he's, he's an attention merchant. He's really quite good at that. That's actually how he's built his brand. Counter positioning against Silicon Valley, counter positioning against can, counter positioning against this, counter positioning against that. It's like, go take something that a lot of people go to, a very polarizing topic, either personally or professionally, counter position against it. And there's actually like a very clear path. You can kind of grow your brand, grow your business on that very clear trajectory, very clear path.

[Peter]

But he even admits that, right? So he talks about, you know, if he doesn't get negative comments, he hasn't, he hasn't pushed it far enough.

[John]

Yeah, which is totally true.

[Peter]

Again, so he knows that. He says I asked him a question right at the end is does he think he's ever been wrong? And he was like probably between a third and half the times. So he's quite open to being wrong.

[John]

Yeah, As a reminder, he said that Macy's was going to surpass Amazon as the big E commerce player. So, you know, we can look at what's in the Galloway portfolio, compare that to the S and P 500.

[Scott Galloway]

He has an. There's an important, maybe somewhat kind of sad insight. I'm not sure he's saying this, and I don't put words in his mouth, but, like, one could interpret it broadly in this way that you can say 100 wrong things. And if you say one thing that's right, because culture moves so fast, it moves kind of at the, like, speed of the feed that, like, you just say the one thing people remember you for, the one thing that might be enough to be known these days, you know, and so nobody remembers what you didn't get. Right. They kind of know the one time you said the market was going to crash or this thing was going to happen. And you string together enough of those things and it starts to look like a pattern.

[John]

Yeah. It's also like, listen, it's funny and we respect the guy and he gets attention and it's all great. But, like, there is something a little sad about it. Like, as a reminder, he's a professor of marketing.

[Scott Galloway]

I just like to remind everyone, adjunct professor of.

[John]

Adjunct professor of art. So he's teaching the next generation of marketers at nyu, which is top business school. And also, I know for a fact, like, a lot of executives listen to Galloway. Like, at LinkedIn, like, the executives reference Galloway all the time. So his idea that, like, brand is dead. Nobody advertises. All you need is a great product that will grow through word of mouth. He says it with incredible eloquence and confidence. It's wrong on a thousand different levels. Demonstrably wrong. But, you know, it really, like, it has a negative effect on the whole industry to have someone so charismatic saying something so wrong at scale.

[Scott Galloway]

I was shocked, actually, when he said, I believe, because I was in the crowd. It was a wonderful event, John. Thank you for having me. And he said something like, yes, he.

[John]

Let anybody into play.

[Scott Galloway]

You know, doesn't advertise five times bigger than McDonald's. I literally checked on my phone in real time, and McDonald's is five times bigger than Chipotle. Yeah.

[John]

And Chipotle advertised.

[Scott Galloway]

This is like, it's not just demonstrably wrong, it is immediately falsifiable.

[John]

Right. It's like you Google it while he's talking. You're like, that's not true at all.

[Scott Galloway]

But again, his. His game has shifted from being marketing to being commentary. He talks about so many different things now. When you're the game of attention, you're talking about every new thing. You know, you're talking about culture now. And I mean, how many different things can you, you know about? I mean, you know, Warren Buffett, our boys is retiring.

[John]

You know, one of our close friends, if you're listening, we love you, we miss you.

[Scott Galloway]

Him and Buffett have the idea of circle of competence. It's like you have a circle of competence. You probably know about very few things, you probably keep to those things. And the other things you probably shouldn't have a lot of confidence talking about. But yeah, you can. If you're not being held accountable, then talk about it.

[John]

You compare Galloway to like Ritson, you know, they're both marketing professors, right. The difference is like Ritson is talking about marketing, and when Ritson's talking about marketing, he's talking about the most cutting edge and empirically rigorous ideas in marketing. Galloway's hopping back and forth between, you know, Macy's gonna beat Amazon, brand is dead, invest in S P500.

[Scott Galloway]

You aren't going on another phase.

[John]

Like, it's just, how many things can you possibly be an expert expert in?

[Peter]

You know, I mean, I mean, Galloway is way beyond marketing really, in terms of what he talks about.

[John]

No, he's, he's like a life professor.

[Peter]

Yeah, more like a life.

[John]

He's a life coach.

[Scott Galloway]

He's what we call famous.

[Peter]

Yes, he's famous.

[John]

He's famous, God bless him.

[Scott Galloway]

We're talking about, may we all be as famous. It's working day. It's working. Don't stop.

[John]

Don't stop. No, don't stop.

[Peter]

He'll be very happy right now. Yeah, right, exactly. I mean, the other thing I think that he, he kind of misconstrues is by picking examples of tech disruption. And that applies to everybody. So if you're Nvidia, of course you're going to not rely on advertising to begin with or brand building to begin with, because you've got an advantage technologically. But most of us working on most brands are having to fight a different fight. And even the tech, as Amazon is a great example, is you had a product advantage at one point, but when everyone catches up, what have you got left? You've got your brand. And that's going to be the thing that's.

[John]

Yeah, it's reasoning from the extremes. John and I would get this all the time. We'd go to Singapore or say, invest in brands. Someone hand would go up and somebody would be like, Airbnb doesn't need to advertise. And what would we say, John, you're not Airbnb. You're not Airbnb. You're not Scott.

[Peter]

Well, ironically, Airbnb then did get.

[John]

And then, of course.

[Scott Galloway]

Right. That's the funny part.

[John]

If, like, even these companies that are held up as not advertising, like Amazon, which famously said, you know, ads are the tax you pay for a bad product, like, Jeff Bezos has certainly eaten his words on that one. They're the largest advertiser in the world.

[Scott Galloway]

And they run an enormous advertising marketplace. That's how people find products on, you know, high quality brands are found on Amazon. I mean, there's a million Chinese copycats. How do you find high quality brands? It's the signaling you get with advertising.

[John]

I think the interesting take that Galloway started to get, to which I think you could have a very interesting conversation about, is in an AI first world, where people are no longer Googling necessarily, like, what hostel do I stay in in Istanbul? They're just asking ChatGPT, you know, what does that mean? And is that the end of brand? But I think if you look at all the data, actually, it'll just be the same thing. Like, just like humans use brand as a shortcut to get to the right answer, the LLMs will do the same thing. You know, we've already seen it for ourselves. Like, I'll take someone's phone and I'll say, hey, who's the leader in synthetic research? And our brand, Evidenza, will come up. And why does it come up? It's because we were in the Harvard Business Review and we were in Marketing Week, and the models are upvoting, they're upweighting those reputable brands. So whether it's a robot making the decision or human looking the decision, either way, they're going to default to familiar brands.

[Scott Galloway]

Well, this is a. This is a big misconception. I was actually listening to a podcast, maybe last night or the night before, with Andrew Bosworth.

[John]

You listen to a rival podcast, not John Evans podcast, it was an Andreessen.

[Scott Galloway]

Horowitz podcast who just unwent their own. Interesting reread.

[John]

It's a good one.

[Scott Galloway]

He's the CTO of Facebook and he's talking about AI, and they have the exact same conversation with AI. Like, brands are going to die, you know, and so obviously there is this kind of undercurrent that flows through Silicon Valley, which only believes in technology and product. That assumes brand doesn't matter. Technology is all that matters. But in the same way you have to think of what to type into the chat box on Google you have to think of what to say into OpenAI or what to say to Claude or what to say to Gemini. And so it's the same idea. You have to program the mind. Like you win the mind to win the market and the brand. Brands are shortcuts. We do things that are easy and so like hacking the mind or programming the mind or mental availability, however you want to talk about. Like the mode may change, you may go from typing to talk, but it's going to be the same mental shortcut brand.

[John]

Yeah, let's just, let's just use an example. Okay, so let's say you work in IT or a CIO and you need IT service management software. You're probably going to go with ServiceNow, which is the market leader in that space. You're not even going to go to Google or ChatGPT. Now let's say we're in the AI era and actually you go to Chat GPT and you say, hey, I need a new IT service management platform. Who should I use? Let's say ChatGPT brings you two options. Okay, they bring you ServiceNow or like Jimmy's Discount IT Service Management Shack. Like which is the human going to pick? You know, so there's just no way around it. Like at the end of the day the human is always making the decision and the human prefers familiar brands. We're biased towards familiar brands, as are the large language models. So just an ice cold take for gallery.

[Scott Galloway]

We can tie that to B2B by the way. Like let's say that it brings you, let's say ChatGPT brings you these two answers.

[John]

Baba Ghanoush and Baba.com a service.

[Scott Galloway]

Now you may want to go with Baba Ganoush, but you're going to think, well, I've got to justify this to like 10 other people on the buying committee. Do I want to make a fool of myself? Do I want to risk losing my job by recommending something I've never heard of, but came to me through an AI and you know, I, I don't know if I want to do that.

[John]

And can the AI go to the meeting and defend it for me? No, I have to go to the meeting and defend it.

[Peter]

Right?

[Scott Galloway]

So the AI may own, you know, you don't want both the AI both taking your job and losing your job, if that makes sense. You know, it's like you're going to choose brand for like a very specific reason. Which is risk mitigation or blame mitigation.

[Peter]

Yeah, but I mean, at the end of that, for me, I think you touched on this, that it's the psychology that actually wins this argument, because the way humans make decisions hasn't changed for a very long time, isn't about to change quickly. So there's this lovely heuristic we use at System One, which is fame, feeling and fluency. Right. Have I heard of it? Do I have positive feelings and associations towards it? And does it come to mind first or quickly? Right. And that predicts about 85% of a brand scale. So that's how we think the routes to market might change in how we get those messages across. But how the consumer is making decisions hasn't changed.

[John]

That's the great fallacy at the heart of the Galloway argument is he's overly fixated on how has culture changed, how has technology changed? And he's missed the big picture, which is that it's the human brain, and the human brain hasn't changed in 300,000 years. And brands exist because people do not want to research. They don't want to spend 10 hours deciding what hotel to stay at in Istanbul, so they will default to the Mandarin Oriental and, you know, the Four Seasons, which were the examples. Gal. Oh, by the way, Galloway's like, I don't stay at those brands anymore. Now I stay at the Soho House. Not a brand. I'm like, what? What? That's a brand. What are you talking about? It's like. But that's the whole point. Like, you can't escape from people like.

[Peter]

You who don't want to go to mainstream brands, you know?

[John]

Exactly.

[Peter]

It's a premium brand. That's what they.

[Scott Galloway]

I just interpreted that as bragging. He's like, I don't stay at the Ritz Carlton anymore. I now stay at the Soho House.

[John]

So.

[Scott Galloway]

And I go there because there's lots of, like, hot dogs and chips. This is interesting. I don't know where we're going with this.

[John]

I learned more about Galloway than I did about marketing effectiveness. Let me tell you that much.

[Scott Galloway]

Galloway effectiveness, very high.

[John]

Marketing effectiveness, very high. Very low.

[Scott Galloway]

Quite a bit lower.

[John]

Very low.

[Scott Galloway]

Brilliant.

[Peter]

Right? We must talk. We must. One of the data points that I know we're both big fans of, which I think absolutely puts the nail in the coffin for the era of brand is dead. I know something you guys had a hand in kind of popularizing is the Ehrenberg Bass 95.5rule, which I just think is it's one of those so it's such a simple insight that when you think about it, makes complete sense, but it completely changes how you approach marketing. Because if, if on average, only 5% of people are in the market today to buy the brand that you're selling, you have to spend a lot of your time and effort trying to capture the future buyers of your brand. And yet, you know, in most categories, particularly in B2B, we spend all our time trying to chase after the 5%, don't we?

[John]

Yeah, I mean, listen, it's the keystone concept. You know, it was John Dawes idea. Credit to Professor John Dawes of the Armberg Bass Institute. I like to think John and I had a role in popularizing it. You know, we wrote some of the first articles about it. But ultimately the reason it's gone so far and been so widely adopted is because everything just kind of falls into place. It's like, okay, now I get it. My objective is to influence future buyers, get future cash flows from future buyers. My creative, I get it. The job, my creative is to create a memory that will be recalled in the future when someone goes in market. It's not to say, buy now, buy now, buy now to people who are not going to buy for years, the media, you know, I need to broadly reach all the people who could buy from us in the long term. And in the short term, the measurement, you know, I need to measure how sticky those memories are, how likely we are to be recalled, not how many people are clicking or converting. So every aspect of the job of marketing just sort of falls into place. When you get your head around the 95.5 rule.

[Peter]

It also explains why you've turned up in costumes. Right?

[Scott Galloway]

It does.

[Peter]

The point is to be remembered at the point you're thinking about buying the products. Right.

[Scott Galloway]

Well, in advance. Yeah, I mean, the thing I really love about it is coming back to the point about, you know, Silicon Valley or Galloway, they think it's technology that matters, or it's product that matters, or it's culture that matters. Like, I think a Ritzen idea that has been very influential is market orientation. The customer is the person that matters. And in fact, the 95.5 rule is very customer focused. It's not talking about the funnel. Like, no customers at the top of the funnel or the bottom of the funnel. The customer is either thinking about your category in market or not thinking about your category at all out market. And most people are not thinking about the category. They're out of the market. And so actually you have to kind of Sell to people who are not in the market to be sold to. One of the only real ways you can do it is what we're doing, right? It's building your brand around. These are people that are doing synthetic research, marketing, AI. I broadly get that about them. They're dressed up in a costume so I recognize them whenever I see them. I don't have that need today, but maybe tomorrow my boss is going to say, should I name my after party, you know, Data After Dark, or should I name it Supply Chain and Champagne? You know, and then they're going to be like, I need that answer really fast. And the only way I can get that is synthetically. Right. And so you kind of have to market to people who are not going to buy it to you. You have to do it through what we're doing. Characters, fluent devices, distinctive assets. That's just a very customer focused way of seeing the world. Like, I know that they don't care, so I have to do something that's very easy for them to like low cognitive load to get them to kind of pay attention or just even notice. And then if I've done that, I've probably earned the right, once they move in market to be shortlisted and make the sale. But it's very customer focused. Then there's a cash flow analysis.

[John]

Well, it's both customers. The 95.5 rule anchors you in your actual customer, they in market or out market, but it also helps you with your internal customer, which, if you're in B2B, is sales and finance. So the message to finance is, hey, 95% of people are future buyers, which is the source of future cash flows, which is what determines our valuation as a business. Businesses are predominantly valued on future cash flows. So you could say to finance, I'm not doing brand because it's like cute and I'm like obsessed with, you know, brand mood boards and personal. I'm doing it to make us more money. When people enter the market, and that's a story to finance, to sales, you say like, hey, you know, the 5% that we're going after today, they're actually, they're mostly spoken for because there's great research from, you know, Bain and Google saying that something like 80% of the time people just choose whatever brand popped into their head on day one of the sales cycle. So then you basically said it's sales, like, hey, let's not play that losing game that everyone else is playing. Let us help you fill the pipeline so that you get more leads coming in when People actually enter the market. But maybe somewhat counterintuitively, that's not by running lead gen advertising, it's by running, you know, talking geckos saying, hey, when you need car insurance, think of Geico.

[Scott Galloway]

But people have basically for a long time said right person, right message, right time, which is wrong. It is right person. It is right message, it's wrong time. Actually, it's well before they're going to buy. It's not right time, it's wrong time. If you reach them at the wrong time, assuming they're a category buyer, you'll then have the chance to sell to them at the right time.

[John]

Right? People don't think about you reach them when they're in market, it's too late. And it's actually a great finance idea. I was talking to my financial advisor the other day, lovely woman, Courtney Marilyn shout out Courtney hurt. Sure, she's listening to the podcast, but she sent me this thing from bank of America where they're like, it's not about timing the market, it's about time in market. And it's the same thing in marketing. It's not about timing the customer and trying to reach them right when they're in market, it's how long have you been investing in your brand? Just like how long have you been investing in the s and P500. That's the predictor. Talk about some good advice from Scott Galloway. He talks a lot about this. Right. Compounding. And it's just like, how long and how early did you invest in the S&P 500?

[Scott Galloway]

I would say that again, you can go back to Buffett here. Buffett was very early on Geico, so Buffett very quickly understood, if I can build this kind of memory device, the get Geico gecko, if I can win the mind, I will win the market and then that will grow my share and it'll be extremely profitable. But I mean, I credit him with being, I mean he's actually in many ways a brilliant marketer. A really brilliant marketer. If you go read the old papers he wrote, he's written these like one pagers that have been circulated around Sees candy and stuff. You get to see all of the hallmarks of mental and physical availability well in advance. He gives incredible advice, I would say on life, incredible advice on business, incredible advice on brandy. But he really understands you win the mind to win the market. Memory is a bit of a moat. Like we're trying to build memory around synthetic research. Our characters build a moat there, but that's not an idea. That obviously is widely pursued even today. But I was amazed that the most financial person, the greatest investor, the greatest investor of all time was deeply invested in Coca Cola and Amex and Geico and Apple. Like, he really internalized that in a way that's extraordinarily powerful. And so Buffett on brand is kind of like, that's. You should go read about brand, not Galloway.

[Peter]

I love your. Bring it back to Scott. Talking about compound interest as well. Because the other thing that people forget about building brand is exactly how it compounds and becomes greater and greater return. We did some research last year, actually system one called compound creativity. We were looking at creativity. But you look at this gap emerge. Those that are consistent about how they present their brand to the world, the return just gets bigger and bigger. And those that keep on changing what they're saying end up flatlining.

[John]

Yeah, marketers are day traders. You know, they're changing their tagline and their creative every five minutes. That's the equivalent of buying and selling stocks every five minutes. Just like in financial markets, it's the people, you know, the people. Have you ever seen that famous Fidelity study of the people who had the best performance in Fidelity? They were like these people who just kept crushing the market. And Fidelity was like, what do these people have going for them? Are they like financial geniuses? Are they mathematicians? And at the end they found that they were just people who had forgotten their password and couldn't, couldn't change their investments because they couldn't log into the platform. So it's like, if we could actually just figure out, if we could figure out how to lock marketers out of changing their creative, you know, if it was password protected and then we wouldn't tell them the password, all their brands would probably be a hundred times stronger.

[Scott Galloway]

There's another point we kind of should make also about, in my experience, all B2B marketers have a problem making the case to finance and sales, right. Why they should invest in brand. But you can also. It's not just that the 95.5rule puts it in customer terms, it puts it in cash terms. So you can say these people, the in market customers of 5%, they're your current cash flows. These people are your future cash flows. You need a steady stream of future cash flows in order to underpin the value of the business, the market cap of the business. And so you have to be balancing those two things. Things. And if you don't, as you said, you will grow, maybe in the short term, but you will flatline. And then you will decline. And that's not a place anybody wants to be. The problem is that most people are not in market in their job. In market like don't have their job or tenure long enough to make these kinds of longer term investments. I mean, it's overwrought the idea that all CMOs lose their job in four or five years, but you have to think in decades rather than in kind of minutes. And as Peter said, that's just not how it works, especially in a world of chasing clicks rather than memories.

[Peter]

Well, I've got a theory that actually brand matters even more in B2B, right? Because if I think of B2C, if you can get yourself on shelf, let's say you're a new toothpaste, if you can get yourself on shelf, you've got a chance. Because people might buy toothpaste two or three times a year and you're side by side, you've got some physical availability, you have a chance, right? If you're in a product category that's bought every five years and there's no shelf, like you've got a really, really big brand job on our hands. And yet if you look at where people spend their money in B2C, it's well established. You might do 60, 40 B2B. In fact, I've been doing a few workshops recently with some senior B2B marketers asking for the average split. And most people come back with 9010 in the performance. Now they should be saying to me, 9010 brand. You are saying to me 92 theory.

[Scott Galloway]

A theory about B2B brand and where you should spend.

[John]

Would you like to see some data?

[Scott Galloway]

What if I told you, John, there's a company that can do synthetic research and ask category buyers how often they buy the category?

[John]

Would that be something you might.

[Peter]

Yeah.

[Scott Galloway]

And you could calculate personalized or customize or category kind of.

[Peter]

Could you get them on the podcast?

[John]

Yeah, we could actually. Oh, I think they're on the podcast. Yeah. Well, why don't I tell you what we did and then John can show you the data. So as a reminder, what we do at Evidenza is we build synthetic samples. So you choose a category buyer in B2B. Let's say it's a CEO of a company with, you know, 10,000 plus employees in Minneapolis and the manufacturing sector. So you get a tightly defined audience, 3M. And then you get AI to impersonate not only that individual respondent, but you do it at scale. So you create a thousand permutations of a CEO who buys ERP software. And then you can actually get these synthetic respondents to take the surveys and get it, you know, a thousand times faster and much more cost effectively than you could have if you even attempted to get a CEO of a Fortune 500 company to take a quantitative survey, which is basically impossible. So in this case what we did, and John will walk through some of the data is if you actually look at John Dawes seminal paper on the 95.5rule. One of the best things about the 95.5 rule is that you can actually immediately test the theory for yourself because it's a survey. You just field a survey to people and say how often do you purchase the category? You know, is it every quarter, is it every month? It's actually a pretty simple survey. The problem is nobody runs the survey because people don't run surveys. It's too slow, too expensive. So what we basically did is. John, you want to talk about what we did?

[Scott Galloway]

God, I thought you'd never ask.

[John]

You thought I'd never ask. I did, yeah.

[Scott Galloway]

I mean we will produce synthetic data that estimates how many people buy in a week, how many people buy in a month, how many people buy at a quarter, a year, two years, five years. And that data is synthetic, but it's rooted often in a real piece of evidence somewhere around people talking about how often they buy the categories. This is the way that synthetic data is often modeled on real world actions. Right. But the data is very interesting because the data shows for CRM, for example, over a five year period, 100% of people in that category will buy the product. Product cybersecurity, same thing, 100% cloud, 100% medical devices. Only 71% of companies will buy medical devices over a five year period. And ERP only 63% over a five year period. So you're going to basically try to get everybody to buy. Now when in the case of ERP, maybe only three people will buy over a five year period. So there's another 40% who probably won't buy for another three, four years. So it really just tells you that like you need to kind of think in a five year horizon and that's the way to kind of program your brand and demands. But like really like it's a lot of it should be brand because most people are just not buying. Right. They're only going to buy once every five years or so. So I would spend like you're saying it's 1090. And at LinkedIn we saw, I think it was 1585 and the number I'M not sure the numbers should be reversed. It shouldn't be necessarily 90, 10, because you have to compete very fiercely for customers in the market. John Dawes made that point to us. But I think at a minimum it should be 50, 50. I mean you should think of it like you should be like a hedge fund, right? Like I'm hedging part of it on the future and part of it on.

[John]

The current stocks and bonds.

[Scott Galloway]

But that's not. People are doing like everyone is basically short brand and they should be long brand.

[John]

So we did this for like 20 categories. We did it for 10 B2C categories, 10 B2B categories. We fielded the John Dawes survey and now we have, you know, you should show the quarterly view as well, because I think that's interesting.

[Scott Galloway]

Yeah, the quarterly view is interesting because, you know, as you can imagine, like everybody buys milk in a week. You know, as we just saw only 60% of people buy ERP in five years. So like that just teases out a little bit of the difference between obvious differences between BNB and B. So B&B, B2B and B2C. But in any given period there's basically like 11 times more people in B2C who are buying the category. So B2C is a very common category. Means to me it ought to be more activation, right? More kind of like lead gen, depending how you want to think about it. And it means that brand should be the opposite. Basically consumer should be B2B and B2B should be consumer. But it's the complete opposite.

[John]

But it is category dependent. I think the critics of the 95 Faber were always like, well, is that true for every category? Like now you can look at every category, we have it and you can see it makes sense to think, you know, maybe in terms of months if you're selling B2C, it makes sense to think literally in decades if you're selling erp, you know, and these are the kinds of, like, these are the kind of things that you need to know to explain to your CFO.

[Peter]

So what percentage kind of range? So if 95, 5, I'm guessing is an aggregate or an average of the study, what kind of variance did you see in the data from the most.

[Scott Galloway]

Categories will over a 5 year period get 100 of buyers? But again, like ERP was the one I think we saw where it has the fewest buyers over a five year period. And that's again, two thirds of the people will buy the category. So like that's probably like something you buy every eight years, right. Cars you buy every 10 years.

[John]

Right. Which is very cloud.

[Scott Galloway]

You buy every three years.

[John]

The cars thing is interesting though, because there's actually B2C categories that are purchased even less frequently than B2B categories like cars look more like error pee than they do look like toothpaste, you know, and actually things like cybersecurity or CRM are like a little more frequently purchased. You know, maybe those are more like televisions than they are. They're certainly not toothpaste. But there is this whole range and it makes sense to actually think about like the category content.

[Peter]

One I worked on, which I'll test you guys out on then, is, is I worked on the number one energy drink in the uk, Lucozade. Right. And we had a bit of a brand relaunch. I got the data out inspired by, you know, how brands grow. I thought, well, I better check, you know, how often do you think that one's consumed on average?

[John]

I would think people buy it maybe like once every six months.

[Scott Galloway]

I think 20% of people buy. 50% of the category usually is the Ehrenberg Bass idea.

[Peter]

So, yeah, pretty spot actually. Yeah. The average purchase frequency was 2.

[John]

Right.

[Peter]

So it actually bang on in a year. But this is the data that blew my mind.

[Scott Galloway]

Other people probably wants every three.

[Peter]

We were looking. The mistake we made is we cut the data by a year because we started with the assumption that let's look in a year, right, how many people buy? And it came out to them, okay, fine. And we had 26% penetration. So 26% of the UK will buy at some point during the year. I then said, I said to the team, just reset that for three years. Just out of interest, is anyone else in there? 46%. So one in five people were buying less than once a year. So when we had our relaunch campaign, I got the conclusion you came to, which is like, hang on a minute, this is not an eight week campaign, this is like a four year campaign.

[John]

Yeah.

[Peter]

Like if we're going to genuinely reach everyone and that 20% is huge, you know, they're the people we need to get back to. The light buyers, you know, is where your volume comes from. So even in energy drinks, which you'd think would be a high frequency category, that plays out.

[Scott Galloway]

What I love about this data though is, and this is like an interesting segue into AI and what AI is capable of. When John Dawes did his research, he's a single professor who has many things going on and over the course of a month, he Pulled together a paper that referenced, I think, three categories. And now, you know, you don't have a professor in a department. You basically have a professor, a PhD in your pocket. And so there's all these things that we would have wanted to know empirically that you can now start to establish empirically. Like there just wasn't category data for 20 different B2B categories. Previously there was maybe 2, maybe 3, and now you can produce 20. You could do it on the B2C side. On the B2B side.

[John]

I mean, it's like you can cross markets. You could do 150 markets. What's the 95.5split for CRM? How does it vary by CEOs and CTOs? I mean, the kind of scale at which you can now field this type of research synthetically, just. It's staggering.

[Scott Galloway]

So you can take evidence for the first time, often with like a cited study, you know, that you, you could take it to your head of sales, you could take it to your head of finance and say, like, here's the case, the financial case for investing in brand. And it's rooted in category behavior, it's rooted in customer behavior. Whereas previously you didn't have the Evidenza to go on the offenza, now you do.

[John]

Ah, beautiful.

[Peter]

There it is.

[John]

John loves to rhyme all the time. It should be a crime, but it's not. John likes to rhyme how much you whine.

[Peter]

There's the clip, ladies and gentlemen.

[John]

There we go. That's great. We're done.

[Peter]

You do. You do need a jingle, though. I mean, you've got the, you've got the characters. We definitely, surely the jingles.

[John]

We definitely.

[Scott Galloway]

I mean, we've been talking about going the defenso with evidenza go on the offense.

[John]

We've been singing the paw patrol jingle a lot lately.

[Scott Galloway]

Paw patrol get there on the double.

[John]

We do, yeah, it's unfortunately, it's taken, but maybe we could do that with synthetic data.

[Scott Galloway]

We do.

[Peter]

It feels like a little brief, doesn't it?

[John]

Yeah, it's a good brief. We accept. Brief accepted. John, we'll come up with.

[Scott Galloway]

I mean, the question, I guess around this is do you think that the. Do you think it needs to make sense or do you just think it needs to be memorable? Like memorable? Yeah, I think so.

[Peter]

No, no, making sense.

[John]

Nothing needs to make sense. We'll be giving demos of our, our, of our platform to clients and they'll interrupt. I'll have just shown them category entry points for aviation maintenance services and the guy or, you know, the Woman will interrupt and be like, sorry, I couldn't help but notice, why is everything in Italian Renaissance branding? And I was like, well, you just answered your own question. You noticed it. Like, that is the point. The point is that it's weird and noticeable. Is there any, like, logical reason why a synthetic market research company should have Italian Renaissance branding? Not particularly. Other than me and John plan to retire to Italy someday, I think. But short of that, you know, it doesn't need to make sense. It just needs to be memorable.

[Scott Galloway]

Lesbinette and Sarah Carter in their book 66 Ways, not the Plan. I don't remember the exact data, but it's very similar to the character idea. It's like, nobody uses characters, but characters are wildly effective. Maybe it's less than 1%. And I think the same thing was true. Nobody uses jingles, but jingles are wildly effective. So you could just probably build a brand on a jingle and a character. Keep that in mind, by the way, and that would be an incredibly, like, empirical growth strategy.

[John]

Next time you have us back on your show, John, I vow to you, I make this, Val. We will have a jingle. We will have a jingle by the next time we're here.

[Peter]

I mean, question is, it will be.

[Scott Galloway]

On the offense or the defensive.

[John]

I'm not saying it's going to be a good jingle.

[Peter]

Surely you can ask the audience, get them silly. But I mean, going back to my good friend Orlando, which I know you guys know well, love Orlando, his work on the left and right brain and what features and advertising get remembered. And music, melodic music, comes out top right in the box. You know, it creates an emotion and it sticks in the memory.

[Scott Galloway]

Top right is all right.

[Peter]

There you go.

[Scott Galloway]

All right, all right, all right.

[Peter]

So he talks about 95.5rule as being something you can get to very quickly in a way that you wouldn't do before. What are the kind of biggest marketing questions that people are asking you to answer with AI that couldn't be answered before. Now they can, because evidence are here.

[John]

I think a good way to think about what should you use AI for is basically like, how painful is the traditional equivalent. So in other words, like market research, very broad category. But within market research, there's types of research that are pretty fast and cheap, and there's ones that are really slow and expensive. So if you're looking for efficiency gains from AI, the largest gains will be on the most complex, low and expensive forms of research. So sure enough, like, that's mostly what we're doing. You know, clients come to us for segmentations and Persona research. Personas, I mean they're usually put together qualitatively or talking to sales. If you try to do it quantitatively, like a segmentation could easily spend half a million or a million dollars, you know, it could take up to a year. So now with AI, you could do 100 segmentations a day across 10 different categories and 100 markets. So the efficiency gain there is staggering. Category entry points is something we're doing a lot of work on. So John and I used to do that with real humans at the B2B Institute. It was phenomenal. But you know, cost 200 grand took six months. Now again, you can do that across 11 categories, 150 markets, fraction of the time, fraction of the cost. So I think it's a good mental model in general is, you know, and this happened when we first took our business to Linda Boff, who's the legendary CMO of GE and now is on our advisory board. We told her about our company and she was like, the reason I love that idea is because, you know, you can be a vitamin or a painkiller, famous thing in startup life. And you want to be a painkiller. Like right now in AI, everyone's like, how can we get AI to develop the creative. That's marketers favorite part of the job. That's the last part of the job they want to give to robot. Running a quantitative survey that cost you half a million dollars, you know, took six months and maybe got you fired because it came back with the results you didn't want. That's a real pain. That's like you'll happily hand that off to the robots. So I think it's just a good mental model for AI in general is what is the sort of work worst part of the supply chain. That's where you should apply AI first.

[Scott Galloway]

I mean, the way that some like VCs talk about categories you should try to build a business in is low NPS so nobody likes it and nobody rates it. And then high fragmentation, lots of vendors and those things are related. And market research is the most obvious place that that's true. There's all sorts of problems with, on the one hand, survey fatigue. You know, people get tired taking the surveys. On the other side of the client side, it's survey remorse. I didn't ask the question properly. I got back the research, didn't tell me what I wanted. And in some ways we're solving both of those problems. And once you reduce the risk on kind of the fatigue side and then the kind of client side, then you lower the kind of cost of asking questions. And people, it turns out, want to ask a lot of questions. And the reason they want to ask a lot of questions is they want to understand what their customer thinks and says and does and, you know, who they talk to and what matters. And so I've been amazed by. On the one hand, as Peter says, there are very substantive things people want to figure out, like who's on the buying committee, how long is the process, why do they buy? You know, what should our segmentation look like? And then there are. On the opposite side, there are very superficial questions, which, in their own way, are just like a wonderful way of understanding what the customer thinks, which is, again, like the Data After Dark or Supply chain.

[John]

What should I call my after party? What should it say when you submit a form? Should it say, thank you? Should it say, you know, I mean, these are tactical things? Where previously the cost of complexity was so high or the cost of curiosity was so high, I should say that, you know, you reserved market research not just for the biggest brands, but the biggest questions. Now, as that comes down, all of a sudden, you can have every single marketing decision you make informed by some sort of quantitative research, which nobody really does. I mean, we did synthetic research on this. We asked synthetic marketers, how often do you do, you know, quantitative research to inform a marketing decision? I think it was like 10% said, yeah, we do that. You know, always.

[Scott Galloway]

Microsoft famously used to say they wanted to put a computer on every desktop. And I think our idea would be put a customer in every marketing plan. Because right now, most marketing plans do not have voice of customer or data from the customer or verbatim from the customer in any meaningful way, because the.

[John]

Customer'S too hard to find.

[Scott Galloway]

But they should, right? It's too hard.

[John]

Have you ever heard the Jeff Bezos empty chair thing before?

[Peter]

Yes.

[John]

Yeah, it's a great example. It's like Jeff Bezos leaves a empty chair in every room to represent the customer. But there is a reason that the chair is empty, because it would be deeply impractical to fill the chair every single time you need to make a decision with the customer, even though the customer is the most important person in the room, as Bezos is saying. Now, with AI, you can literally fill the chair for every marketing decision. You can have the voice of the customer. And, you know, it's very paradoxical. You'd be like, how did the invention of robots make marketers more focused on humans and their customer? But I think it's absolutely what's happening.

[Peter]

I don't know if you have the same program over here. We have like who Wants to Be a Millionaire program on tv.

[John]

We do.

[Peter]

And they have this ask the audience, right? Where you get stuck on a question, you press a button and you get to ask the hundred people that are there live in the show. And that answer is usually the right one.

[John]

Right?

[Peter]

Because it's wisdom of crowds.

[John]

Wisdom crowds.

[Peter]

It's like that, isn't it? It's like the same thing. You get, press a button every time you got make a decision, ask the audience.

[John]

Yeah. Focus group on demand, Customer on demand. Quantitative research on demand. I mean it's wild.

[Scott Galloway]

The Internet is basically the world's biggest market research study. And if you think of it in that way, you can start to ask all sorts of interesting questions. You know, no matter how big, how small. I mean that's the number one thing I think every CMO should think about is how can you bring the voice of customer into your organization, you know, for as many big or small decisions as you want. But the truth is, as Peter said, you know, you can use it for. People traditionally use it for one big survey a year. You should have one big survey a month. You should probably have one big survey a week. I mean it's just, that's where the world will go. And frankly, like we'll all understand our customers better. We will build better businesses, customers will be happier as a result. Like economies will probably grow. I think there's a very positive way to think about this. The closer you are to the customer, the better your business does.

[John]

I think we, I think that's probably my big takeaway from like being in this AI space for a year is like you've got the critics who think everything's going to get worse and then the optimists are kind of like, oh well, it'll just be the same but faster and cheaper. I think John and I at this point truly believe it's actually going to be better. Like lab grown marketing will be better than man made marketing. It will not just be faster and cheaper, it will be more flexible. So you can go back and change the sample, change the questions. It can be informed by marketing science. So you can be like, how would Ritson position the brand and bake that into your positioning research? It can be more financial. You could say, hey, go read all the earnings calls in this category and append that financial data to the quantitative research. Now all of a sudden you have a market research report that is not as good as the traditional equivalent, it's probably a thousand times better. It's faster, it's cheaper, it's more flexible, it's more financial, it's more grounded in all the marketing books that nobody took the time to actually read.

[Scott Galloway]

I mean, it's going to be great.

[Peter]

Well, on that, we were working on a similar thing with System One, where at the moment you can afford to use the approach maybe on the top 5% of communication. And we're like, well, hang on, what if we trained the AI on Orlando Wood's work on all the human responses? We've got 160,000 times 150, whatever that number is. It's a lot, right? So all the emotional responses and we can tag everything, encode it all up and that sort of thing. Imagine if you could just. Just test everything in the world, right? Everything in the world.

[Scott Galloway]

This is why the AI will not be average, because you won't ultimately train it on the average thing. You'll train it on the Orlando Wood or the Jenny Romaniac or the Jeff Bezos or the Warren Buffett or the. Whoever it is, right? You'll train it on brilliant people and you'll get brilliant insights. You already see that. I mean, the new models are not trained on the average insight. They're usually trained on PhDs who are grading answers. And so you're getting PhD level answers back. I mean, the problem isn't now that the. The answers aren't good, it's that people don't have good enough questions to actually get the intelligence out, or that there's.

[John]

Actually too much answers and they're like drowning in the data. Signal versus noise.

[Scott Galloway]

Drowning in data, but parched for wisdom.

[John]

Beautifully put, John.

[Peter]

There we go. It's there, isn't it? I love your point earlier about painkillers versus vitamins as well, because I mean, to. To give our good friend Galloway another outing as well. The. There's one thing you said on the podcast that's been viewed that was right.

[John]

One thing that was right.

[Peter]

Well, the. There's been viewed 10 million times.

[John]

What is it I've died to know?

[Peter]

It's quite. He said, the less sexy the industry you're in, the greater your return on Capital. Yeah, everyone wants to be actors and bartenders and, you know, models, etc. Etc. Which have a very short lifespan.

[Scott Galloway]

I've got a rhyme for all of these things, John, and the rhyme for this is boring is soaring.

[John]

Well, but you're exactly right, like Galloway, that is good life advice, but it's also Good advice to anybody looking to start an AI business right now, which is like, look for the least sexy thing that requires some sort of real subject matter expertise and that everyone hates. When we go into a CMO today and we're like, hey, are you happy with your segmentation work? Nobody is like, love it. Loved spending a million dollars on that shitty segmentation. You know, that's like a universal pain point.

[Scott Galloway]

So sorry, what Peter meant is there's no money in B2B. It's very boring.

[John]

You shouldn't. Stay away, stay out of B. Don't do it like there's no money there. You'll hate. Stay away, stay away, stay away. Yeah, but it is too sexy for everyone.

[Scott Galloway]

He is right about that.

[John]

Yes, totally.

[Scott Galloway]

It's a brilliant insight. I mean, there is like a company in called Viva that's a CRM just for healthcare. I mean, Salesforce is one of the world's biggest businesses. And yet in that market, that market is so big it can afford a publicly listed company. It's a pretty big company, just in the CRM category, you know, so like there's riches and niches.

[Peter]

That is insane, isn't it? Yeah, but you're absolutely right. Go for the boring categories.

[John]

Solve the pain and don't be scared. You know, people think AI is just gonna like eliminate their jobs, but in many cases it's doing jobs that weren't getting done in the first place. You know, I mean, segmentation category entry points, great example. It's not like people were doing that job. Now it's gonna be replaced by synthetic research. They weren't even bothering to do that job because they didn't have the time or money. You know, why don't you talk about the bank tellers thing? I always love that.

[Scott Galloway]

Well, before that, I went to an insurance conference recently. It was a marketing insurance conference. It's just like, how many people in this room have done a segmentation study? Yeah, there's probably 60 people in the room. I think probably four people raised their hands. So to Peter's point, nobody's doing segmentations. So if they get to do a segmentation, it'll literally be the first time they get to do it. And AI will probably be the first time they can actually do it. Right. So it's all these things that were never possible. So it's, it's not removing those jobs, it's creating those jobs for the first time. And that's actually really exciting. There's actually a whole new set of category entry points, especially in B2B that are kind of like birthing as we speak. Like, there's the question, like, hey, I need this answer by tomorrow. About, like, let's say, like, should I show this message when I'm, you know, sponsoring a post? Or like, should I show this message? Or I want to do a segmentation? Or like, I need Data on the 95 rule to bring to my board meeting next week. Previously, there just wasn't the ability to do that. So it's probably going to create a market that never existed. And honestly, when it's the digital market, it's usually 10 times bigger. So it's going to create not just a new market, but a huge new market in B2B.

[Peter]

I think that's what people are missing is you're growing the market you're making. You're creating accessibility to something that up to now hasn't been accessible. If you work in pharma and you want to talk to an oncologist about whether this message is going to make them recommend this drug over that drug, that's something that would have cost a lot of money.

[John]

Yeah, well, that's actually a very interesting. So there's things we didn't anticipate about the business. One of them is like, how big it's been in pharmaceutical categories, because John and I don't come from a pharma background, but in pharma, it's actually like, in many cases, you cannot talk to the customer. Not just because it's hard to reach a nephrologist and we have literally done research with synthetic nephrologists, but because there's so many, like HIPAA rules and regulations or, you know, there's risk. Like, you don't want the small pool of rare disease doctors to know what new products you're thinking of rolling out. Now that you're talking to, not you're talking to AI doctors who are not real people. All of the risk is actually removed. Like, you skip months of regulatory compliance and like reputational risk of new product ideas or rebrands leaking to the press. So it's just like another example of how it's not all just faster and cheaper. It's like, better in ways that you wouldn't even anticipate.

[Peter]

We're dealing with complexity there because, you know, you might have government regulations, you know, you might have very technical products that would take you months to even understand before you even gets the answer. But it's able to kind of think through all those, all that.

[Scott Galloway]

We have a medical devices customer who told me that she's thrilled that we let her talk to fake customers because she tried working through legal and procurement to do research and she literally couldn't do it for nine months. So she's like, I literally cannot talk by law to real customers. So I'm delighted to talk to fake customers, you know, and that's a really fascinating and as Peter said, kind of unanticipated, unexpected idea, but that just makes something new for the first time, something possible. I mean, it's actually. It is physical availability in a way, although it's more like digital availability in a way that was never possible before. So, like, if you pair the mental availability with the physical availability, I'm told big brand or small brand, you get growth.

[Peter]

There you go.

[John]

That's what the book says. I think it's true. The book is right.

[Scott Galloway]

Yeah.

[Peter]

Right. So exciting first year. Congratulations on where you've got to with the business. And AI is just changing all the time, isn't it? I mean, I know I was at our good friend Colin Fleming. I bumped into him at Adobe. In fact, his episode came out last week.

[John]

It was a great episode. Colin.

[Peter]

Yeah, Colin's great. I mean, what a brilliant way of. He's got such a good way of communicating complex things in simple ways.

[Scott Galloway]

Let's say he was raising millions at 13.

[Peter]

That. That is amazing.

[Scott Galloway]

Right?

[Peter]

That is a brag, isn't it? I mean, that's legit, but yeah.

[John]

I don't meet a lot of former race car drivers that become CMOs of gigantic enterprise technology companies.

[Peter]

Oh, as my daughter would say, that's a flex.

[John]

God bless.

[Peter]

That's pretty impressive, isn't it? But even at the conference I was like learning like, what agentic AI is, which I hadn't heard of before. But even the language is changing, going from a kind of, is it deterministic to probabilistic. Probabilistic in terms of like not just answering a question, but actually thinking through a brief and an issue and coming and solving it. Where do you guys see the big change coming in AI over the next year?

[John]

I think the big change we've seen in our business, so like a lot of times we'd be presenting our product to clients and they'd be like, this seems too good to be true. Like, what is it not good at doing? Which is a great question. And we always said there's a lag in the data with a lot of these large language models. So it's not very good at real time analysis. In other words, like, they just announced a new Pope while We're filming this podcast.

[Scott Galloway]

It wasn't Pizza Ball.

[John]

It wasn't me. Sadly, an American Pope who has.

[Peter]

And there's been a trade deal with the US And UK all in the same.

[Scott Galloway]

We'll talk about tariffs in a minute.

[John]

So if you were about to poll, you know, Catholics or supply chain managers, you know, if you tried to do that six months ago using synthetic research, we would have told you it's not good at that because it doesn't know that happened. Like, our synthetic respondents have kind of like been in a box. They don't know what happened probably in the past two to three months. What's happened now is that almost all the models have become real time. And so we've had a few clients now where we've been running these tests where, you know, like, let's say they want to know how people are feeling about the tariffs. Well, again, think about the traditional equivalent. First of all, trying to, you know, survey supply chain managers about what they think about tariffs will take forever. Cost a ton of money. But, you know, the news on the tariffs is changing every single day. So by the time you get the data back, it's like, what. When was this even based on? Now that the models are real time, you can literally, like, take a news event and say, how is the market? Or how are CEOs or CMOs or CTOs? How are they responding to this news? And I think that's very, very exciting because now you can start to get these, like, you know, both timeless insights and timely insights to inform your marketing decisions.

[Scott Galloway]

Another thing people worry a lot about, which to me is a bit of an outdated idea, is hallucinations. Like, we were on a call today and somebody brought up hallucinations. And Peter, I always like to joke there is a hallucination problem.

[John]

There is.

[Scott Galloway]

It's with people. You know, the models have gotten much bigger and much smarter now. And so their hallucination rates are literally in many cases, 1/20 the hallucination rates you would get from a person if you. If you surveyed them. So, like, there is a hallucination problem. It's now the opposite.

[John]

Did I tell you my Toto toilet story, John?

[Peter]

I don't think you have.

[John]

So I was in this demo, I was doing a demo, and there was just a guy who was like, agency guy, super skeptical of synthetic research and kept trying to do, like, gotcha stuff. So I was talking to a synthetic person in the UK and a synthetic person in Germany in this synthetic panel, and the guy, the agency guy, the skeptic was like, ask them if they've heard of toto toilets. So I was like, all right, sure. So I go in and I type in, have you heard of Toto's toilets? The German woman says, yeah, actually, I just remodeled my house. We were thinking about toto toilets. It was too expensive. British guy's like, yeah, I've seen that in some upscale hotels. You know, I know about toto toilets. The agency guy's like, gotcha. I gotcha. And I'm like, what are you talking about? And he's like, that's a hallucination. Because toto toilets are only sold in Japan. It's a Japanese brand. So there is no chance people in the UK and Germany have heard of toto toilets. And I was like, that's super funny because I live in Brooklyn and I have a toto toilet. So, like, again, the human is hallucinating. The marketer is hallucinating about what they think they know about the brand, the robots. The synthetic research is actually right, you know, so it has a lower hallucination rate in some cases. So that's been a fun nuance.

[Peter]

That's a great one.

[John]

Yeah. And there's been a lot of those moments where people are just like, no, no, no, no, no. Or we have times where, you know, marketers will present a cmo, will take our research to someone in marketing, and they'll be like, oh, no, no way. And then they'll take it to someone in sales, and salesperson will be like, oh, yeah, we hear that every single day. So there's just so many assumptions that humans have. You know, that's going to be. One of the interesting wrinkles with synthetic research is, you know, you actually see this in medicine. So there was this. This newspaper article in the New York Times of doctors with AI and doctors without AI and then just AI by itself. And everybody wants the story to be that the doctors with AI were better than just the pure AI but the pure AI actually won by a large margin.

[Peter]

If you're having an operation, you want the AI.

[John]

Yeah, because the doctors were overconfident in their opinion. They kept overriding the AI, you know, so it's like, the human is not always right. The machine is not always wrong.

[Scott Galloway]

There's a different angle on the doctor story, too. There's another study on doctors versus AI and in fact, people enjoy talking to and spending time with the AI more than the doctor because the doctor is very busy and very tired and has to get to the next patient. The AI doesn't have to do that, the AI is infinitely patient, it's infinitely empathic. So there's a weird way you can start to think about AI as like it has a heart, like I'm not surprised it has a brain. Like there are large language models, they're trained on tons of data, they're kind of genius. But it actually, that's not surprising. It's the heart that's surprising to me. And then also like another thing that's very big trend obviously is the multimodal nature. So like they have brains, they have hearts, they have mouths, they can talk to you, they have eyes, they can look at stuff, they can listen to you. And so like you now basically have like they are called neural networks, right. And it is called artificial intelligence. And you're kind of getting, you can very quickly see you're getting kind of a digital twin, so to speak, that is capable of doing all the things that humans are capable of, which is that in some people inspires hope and in other people it inspires fear, you know.

[Peter]

Well, I think, I think it was a bit of a branding thing. I mean, coming back to Colin, I thought the whole agentic AI sounded a bit scary. It sounds like kind of like the FBI taking over matters, right. But he just said think about it as your own personal minion. And I was like, oh, right, oh that's great. Somebody can do all the work for you, all the boring tasks, doesn't have to sleep, gets on with it, makes your life better.

[John]

Yeah. The marketing of AI is very interesting. And you know, these Silicon Valley companies that are way ahead of the industry are going to have to figure out how to tell normal everyday people what it does. And you're going to see all. I mean probably the best metaphor I've seen for, you know, agentic AI is this idea of self driving computers, you know, so it's like you can sort of begin to understand what that means. It's that you're not asking the computer what ho Galloway's not going to say, hey, what hotel should I stay at in Istanbul and then go book the Soho House. The robot's going to go self drive computer going to go book its own, your reservation for you and probably at the lovely suite that Galloway likes to stay at at the Soho House.

[Scott Galloway]

I mean that's obviously scary to some people because they see that as I'm going to lose a job if I'm a driver, right? Or if I'm a booking agent, I'm going to lose a job. But there is lots of examples of Automation, like the history of technology is basically the history of automation, right? Where like at some point you had ATMs and that replaced bank tellers. There's actually more bank tellers now than there was in 1960 and then you had kind of like self checkout at grocery stores, but there's actually more cashiers now than you know, there were in the 1960s. And the same thing is true now with Amazon has robots in the warehouses and there's more warehouse jobs. So automation has a weird way of creating more jobs, not removing jobs. I mean that's the hopeful case for it, obviously. Like we have to see how it goes. I don't know if that's hope or cope, but that is one of them.

[John]

It's one of them.

[Peter]

Well, I think that's a perfect place to end, actually. You always say always end on a high, you know, as they say, which is good. And I tend to agree with you actually, because history tells us that with every technical revolution, as you say, it creates more jobs. They're just different to the ones that it replaced.

[John]

But.

[Peter]

But you know, we haven't made ourselves redundant yet, so.

[John]

Not yet.

[Peter]

Not yet.

[John]

Brands will never die. I don't think marketers will ever die either.

[Peter]

Well, listen, I look forward to the new evidence of Jingle next time we meet.

[John]

Thank you. That is our value brief's out there.

[Peter]

But thanks go on the Offenza evidence. Congratulations on an amazing first year.

[John]

Thank you for having us, John. Hugely appreciate it.

[Scott Galloway]

Lovely to see you, John. Have a good one.

[Peter]

Take care. Thank you very much for listening or watching Uncensored cmo. I hope you enjoyed that. If you did, please do hit the subscribe button wherever you get your podcast. If you're watching, hit subscribe there as well. I'd also love to get a review. Reviews make a big difference on other people discovering the show. So please do leave a review wherever you get your podcast. If you want to contact me, you can do I'm over on X censoredCMO or on LinkedIn where I'm under my own name, John Evans. Thanks for listening and watching. I'll see you next time.