Madvertising by AdQuick — Advertising, Marketing & Ad Tech Podcast
00:20:48 · Adam Singer
[00:20:48] S0: For listeners, we'll have to... We'll get a link, and we'll put that in the show description because I'm sure people listening will wanna read that. For my own for my own behavior, I've noticed things like, you know, I used to wanna know how to make a specific recipe. And before, I would, you know, query for how to make, you know, an... A certain type of soup or, you know, maybe a pico de gallo or something. I'm a really bad cook, so I always have to look it up. And instead of having to go through these pages that were optimized for ad revenue that I find from search, I just ask, you know, I I ask ChatGPT, I ask Perplexity, and you just get the answer. And it's just like, for so many things, there... There's it's just a better experience to go to, to go to AI. And I think Google even knows that too. I mean, they're presenting AI summaries at the top now for a lot of things. So, you know, I think for marketers, I wrote about this on my blog, and I basically just said, look. It's bringing us back to kind of where marketing was initially where everything is a rented channel. You're gonna have to buy ads. And then you're also gonna want an email list. Right? If all of your updates on social are controlled by an algorithm, you're not gonna reach all of your followers. You have to pay for ads to actually reach them. If search is going to go away, you know, it's it's just gonna be something where people go directly for an answer. And maybe for navigational queries. Okay. You know, use Google to go to a brand's website. But it actually takes us back to marketing from the nineties. And in a lot of ways, marketing used to be better. It wasn't this thing that was so growth hacky and trying to extract value and, you know, always at the the very end of the funnel. It was this exercise in brand building and building user love and and and telling me stories across time. And I think... Don't I think it's a bad thing for us to go back to that. I I don't think it would be the worst thing in the world for marketers. So if you are, you know, seeing what's happening with these shifts in AI and you're, like, really reliant on search, you know, start to work on that. But I I don't think... I I think it opens up a lot of different possibilities for your team and your budget.
00:22:57 · Mo Moubayed, Adam Singer
[00:22:57] S1: I'd I'd go a step further, Adam, and say, I think you're positioning in a way that's saying it's... You don't think it's bad if we go back to that. I think it's it's inevitable that we go back to that. Brand building is has been on the rise again. I I know there was a huge swing to performance. There's always a conversation about, oh, is brand better or or performance better? The the simple answer is you need to do both. And if you're just doing performance, then the the longevity of that is is is diminishing. And there's a lot of research around brand and performance together, increasing the ROI of of of performance. So think of it like a bit of a dolphin. Your brand is there. Brand building is sort of consistently there, and it sort of moves you to a new plateau, and your your performance gives you that that spike, but then it... Your your brand gets you to another plateau, which is which is really what you're after. [00:23:54] S0: Yeah. The the large... The largest companies... Can can you imagine Coke being built on performance ads? You can't. They're built on brand. So, you know, Apple wasn't built performance ads. None of the brands you love were were built on performance ads. It's like, it's all short termism. Yeah. It can work for some things, but it's like, you know, that... That's not how you build, like, the next LVMH. Right? They're they're not selling and performing.
00:24:17 · Mo Moubayed
[00:24:17] S1: You hit the nail on the head. Direct to consumer makes a... Direct to consumer online brands makes a lot of sense to be kicking off with performance and just figuring out how you get a really clear ROI for every dollar that you spend in the short term. I believe that. I I think that's the way you get off the ground for a d t... DTC online brand, right? But at a certain stage, when when that ROI starts to diminish with your performance marketing. Right? You need to start to invest in the brand, which which then allows your performance marketing to to to hit new heights. And and you see it all the time. You you see these d to c online brands be performance, performance, performance, and then at one stage, they they they start working on brand, and it really brings them to the front and and forefront of people's minds, consistently. And, you know, a great example of that would be Gymshark. I don't know if you you know them. They're from The UK, but there's a bunch of those those Aloe, I would say, was d two c first performance first, and then now you see their billboards everywhere. And billboards is is, you know, probably the... One of the last ways that you can build brand effectively long term. You know? There's... A lot of channels are trying to move to performance and and just be performance. Whereas I think Ada Home does a really great job of of of brand building.
00:25:51 · Adam Singer, Mo Moubayed
[00:25:51] S0: Totally. You know, the performance stuff is so interesting because for a while, there was so much VC money going into a specific performance playbook that... For example, you've heard of Blue Apron, the delivery company. There was a... They they were paying, so much for acquisition. There was a point where you could sign up for Blue Apron, eat for free for a month because they gave you a month of free food, Then... And then cancel the sign up, and then you could do the same thing three months later. People figured out this hack and posted it online, and, like, everyone was just getting free venture capital money food. And so this is performance marketing. They're they're paying for this offer. And the the problem is, like, you're bringing in a certain type of customer, and that customer may not be a high value customer. You don't really know, because you're just incentivizing them. And and I feel like it's just something in the kind of ZERP easy money era. Like, a bunch of people built companies that were were built on all of this performance ad and values and discounts, and a few did survive. Like, you know, I think DoorDash and a lot of the delivery companies built by having really cheap prices. And then over time, they they raised prices. So I think that playbook worked in some areas, but in in other areas, it's just kind of a a graveyard of dead companies, penny stocks. It... It's just a tough thing to do. [00:27:14] S1: Yeah. Exactly.
00:27:14 · Mo Moubayed, Adam Singer
[00:27:14] S1: Yeah. Exactly. [00:27:17] S0: So, in terms of... I guess we have to talk about AI because I talk about AI with all my guests. Do you guys have any thoughts, opinions on what AI means either from a creative standpoint or a process standpoint, from what you're talking to marketers about or anything you're hearing that's kind of interesting? However you wanna answer the AI question, really.
00:27:41 · Mo Moubayed
[00:27:41] S1: I think I gave you some ideas about how AI is gonna affect the out of home. Indirectly through AI affecting search, I think there's going to be a bucket of of of media investment that would have gone to search that will be looking for a home, and I I think Ada Home should be that that home for it, and we're seeing that more and more. So I'm I'm very bullish that AI will, create, growth opportunities for out of home. Secondly, I think AI is, and I'm gonna try to relate this to out of home as much as possible, my my answer. I think out of home is, AI is creating disconnection, and there's a a greater need for human in real life connection. And where does that connection happen? You know, we're we're learning very quickly that that connection is not happening on Facebook and on Instagram. You know, if you look at who people are following on Instagram these days, it's it's celebrities. It's not friends. Right? So that that... And there's there's research on this as well. Like, the the number of friends that people are actually following on on Instagram has gone down, and it's more celebrities. It's more news. It's more media. And so I believe real connections are built not on your phone and not on your computer. They're built in real life, and you look around, and I think more people are coming out and and spending time outside. People are... More people are going to work. You know, AI is is, yeah, I think fueling a little bit of that feeling that we need to go out and make connections. And so I think as a... At a cultural level, AI is gonna get people making connections outside, and and it's gonna drive more eyeballs onto to out of home. I see AI as, an assistant to humans, not as a replacement. So... And I'm and I'm excited about that. I'm excited about, what we can build, what other tech companies are gonna build. I don't see internally AI. I don't see it as a cost cutting exercise. I see it as a revenue generate... Revenue generating ability exercise for us and being able to do more, so increasing productivity rather than cost cutting. So I'm I'm really excited about that and and excited what the team are building. And, yeah, so I think, know, in summary, bullish AI makes me bullish on out of home. Number two, I think it's gonna get more people out... Outside.