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Make Your Marketing Matter.

From 2016 to today, two of the top ten buzzwords in Digitial Marketing have been Native Advertising and Artificial Intelligence.  They are very important topics and will help drive the future of Digital Marketing as we know it.  However, for most marketers, and those who are attempting to reach marketers with online content, these two topics are misunderstood.  

In this episode of Marketer-to-Marketer, Chad Pollit, Author of the Native Advertising Manifesto, and Paul Roetzer, CEO of PR 20/20, dive deeper into these topics and give us a State of the Field for each Native Advertising and AI.  The conversation does a great job and driving insights and connecting these topics together in the context of Content Marketing.

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Transcripts

- What's up man?

- Paul.

- Good to see you again.

- What do you know we're at another Content Marketing World.

- How many is this now? How many have you done?

- Well this is only my third.

- Okay.

- But uh--

- It's doubled up and then one.

- Yeah, you got me doubled up. You got me doubled up. So we've been in this space a long time, we've dealt with lots of different companies from SNBS to enterprise companies and we've seen the evolution of marketing and digital marketing, content marketing, so on so forth. What's the hottest thing on the horizon that's here today that's going to be even bigger tomorrow?

- It's so fascinating when I was actually, Travis Wright, we both know Travis. Travis was just talking to me about Blockchain which I still just don't comprehend. And in three years we can come back and watch this and laugh that I have no comprehension of it right now. But that's one of those things that I just don't get. And I've tried now to get into that space. I think that one's still a ways off. Like I think from a marketer perspective and really caring about it and seeing it effect our daily lives, that one's really out on the horizon. Artificial intelligence to me is the one that's kind of here now. It's where I've been spending most of my time and you and I have talked a little bit about this with your work at the Native Advertising Institute and we had launched the Marketing Artificial Intelligence Institute, so our focus there was really just trying to figure out what is going on. Because you start looking around even here at the exhibit hall, you see AI over here on Acrolinx, and you go running and see artificial intelligence now being promoted on a lot of these companies, but as the average marketer, people one, don't really know what that means, and two, even if they do, it's hard to know how intelligent the software really is becoming. Like is it still a human telling the software what to do? Or is the software actually starting to learn and get better on its own? And eight months ago or so when we launched the Institute, that was the thing I didn't know. Like we would look at 100 companies that all said they did AI, and I had no way of knowing whether they truly did or not. And now we're at the point we're trying to actually start help marketers filter through that. Figure out what is AI actually capable of doing today to make your job easier, more efficient, more productive, and where is it gonna take us in the future? That's my talk on Thursday's machine assisted narrative. It's in terms of creating and promoting content how can artificial intelligence today make your job as a marketer more efficient? Which tools do you need? What should you be looking for? So that's where we're spending the majority of time now. So we still have our core agency but most of my time's in the AI space tryin' to learn about that.

- So would you say that for something to be truly AI, it has to have machine learning? Or is it more than that?

- Yeah, so the basic on, AI is the umbrella. It's like the collective of technologies and processes that machines become smarter basically. So Watson is the one everybody knows or everybody's like familiar with Watson. Machine learning and deep learning are kind of the two main subsets within artificial intelligence. And the basic way to look at what is machine learning is does the software get smarter on its own? So an example would be, if you use a software to tell you when to schedule your social media shares. If there's some tools here that'll do it, say, "Hey send it at 3 p.m." Jay mentioned in his talk this morning, send it at 3 p.m. Well that's a data scientist. They just looked at a data set and said, "Okay the optimal time to send it is this." And until that data scientist or the programmer updates that rule, it will continue to be a human based rule that said when the best time is. In machine learning, the algorithms actually in real time monitor when that optimal time to share changes and what the optimal share time may be for your specific company. And it would, so today it might say 3 p.m. tomorrow it might say 1:44. That's machine learning. It's actually the machine with no human guidance getting smarter and updating what it recommends you to do. That is very rare to find in marketing software today. So there are marketing tools that are using types of artificial intelligence, very few of them are actually getting smarter on their own and thereby changing what they would guide a marketer to do. So that's the machine learning thing I thought a year ago was much further along than it really is in the marketing space. There are lots of really interesting things being done with AI and really interesting companies, but not much in the way of machine learning.

- Gotcha. So what do you think of Salesforce's Einstein?

- Salesforce is interesting they've made massive bets, so they I think bought about nine AI companies, couple billion dollars worth and then they mashed them together into Einstein and it's basically a layer over the core CRM product. So that's the other thing in AI's. There's no platform. There are narrowly built use cases. There's software built for narrow use cases and in Salesforce's case they try to mash these all together. Early feedback I've heard is it's really interesting it probably helps a lot with efficiency, but it's not fully baked yet and it's, like a lot of software companies it was probably announced before was truly what it's capable of doing, so I think, I wouldn't they're by no means in a beta form, but they're in very early stages of realizing AI's potential and actually integrating it into the software.

- Gotcha. Very interesting.

- [Paul] How bout you? What's the thing you're focused on?

- Well, so I took, I felt very European this summer. I took a--

- [Paul] Were you in Europe?

- No, well I did spend a little bit of time in Europe, but no, I actually took a lot of time off. Spent it with my kids. In fact for over a month I didn't touch my desktop, which is where I do all of my work, so, I lied actually I think I touched it four, three or four times. But I, that's the first time I've done that in 17 years in the business.

- [Paul] And that's from agency world--

- Yeah.

- [Paul] to the academic world to--

- Yeah, yeah. Exactly. Because as you know I teach at the Indiana University Kelley School of Business and the summer is my real time off where I don't have to deal with students, and not that that's a bad thing, but I don't have to grade papers, lecture, things like that. So if I wanna take a significant amount of time off, I have to do it in the summer, so I did. Which by the way, if you haven't taken three to four weeks off in a long time, I recommend trying.

- [Paul] Not since college.

- So yeah, I'm still tryin' to lead the way in thought leadership when it comes to content promotion and distribution, both paid and earned. I feel like a lot of people have sort of hogged up that influence or marketing earned side, of earned content promotion through influencer marketing. So I focus most of my attention on the paid side. So earlier in the year I spent nearly a month just researching the native advertising tech landscape. And what I discovered was there's over 272 companies that are involved in native advertising, someway on the technology side.

- [Paul] And define native advertising for me, like what do you--

- So native advertising is content that matches the form, feel, and function of the media that surrounds it. Okay, so a good way to think about it and to get clarity around native advertising is anything in feed that looks like it's supposed to be there. It can say sponsored. So Facebook's a perfect example. You see sponsored posts there, but it's in feed and it looks just like everything else, it just annotated as sponsored.

- So sponsored content, native advertising, same thing or are they, is there distinctions?

- So this is a big problem in native advertising. You also have something called long-form native advertising. And the most famous example of that is Netflix's Orange is the New Black in the New York Times.

- [Paul] I met the lady last night that wrote that article--

- Melanie. Melanie wrote that article, she's here. So that's native advertising too.

- So the reason I bring that up is because to your average person that Facebook ad and that entire article in the New York Times, are totally different things. But they're not. They're both sponsored, they're both in feed, in the natural feed of the website, and they're both paid for. Okay so there's really, there's four categories, there's long-form, programmatic, non-programmatic, the fourth one is social media.

- Okay.

- Those are not the IAB categories, those are the categories that I've come up with because I don't like the IAB's categories.

- [Paul] Interactive Advertising?

- Interactive Advertising Bureau. So anyways, back to your question about sponsor content. Most brand marketers that wanna do sponsored content or long-form native advertising, are gonna call it sponsored content. Now, a publisher's not gonna call it sponsored content. A publisher's gonna call it branded content. So there's a disconnect in the language. Publisher's are starting to adopt content marketer's language to describe what they do. But what they do is actually a form of paid media and content marketers are mostly focused on owned media, with paid as a distribution channel. So there needs to be some clarification in the industry as to the language. And I wrote an article about this on the Native Advertising Institute.

- I remember seeing that.

- Tryin' to clear that up. I mean it's a deep conversation with a lot of people that can go back and forth from the publishers to the marketers, so on and so forth.

- So for us like we, I have an agency and part of our job is to not only create the content, but to promote it and we haven't done much with native advertise, like where do you start? Like if I'm looking at distribution channels for clients, how do you get started in that space? Where do kind of filter through it? There's 250 or however many tech companies you said doing it.

- Well today there's over 350.

- Okay.

- Yeah. So I would start off simple. Run some experiments using, say Facebook, Twitter, maybe Linkedin, if you're B2B especially. Start off with some experiments and get a feel for those channels, okay? Now, there's also a DSP's or, technology service providers that offer a platform that plugs into literally dozens of other channels, okay?

- So you're a pulse point? Isn't that those guys do that?

- Yes, pulse point does that. So they'll plug into social media channels, they'll plug into Outbrain, Tabula, Adblade, Revcontent, so on and so forth. And then through one dashboard, one person can set up a campaign and do optimization and hopefully there's some machine learning built into the platform to help with some of that, do your AB testing, all under one platform. So that's gonna give you scale. So experimenting with those is the next step and might be--

- So I could go direct to Outbrain and just run through their networks or you could go to like an aggregator that has access to all of them and--

- Yeah. And the main advantage, well there's a couple advantages with the aggregators. One is there's generally a service layer. Some are more white glove than others, but if you need the support, that's good to have. The other thing is that their technology and their ability to optimize can have major impact. So for example, I know of a company that the New York Times is actually invested in. They're called Kiwi. Now what they do is, they have machine learning, natural language processing, and other algorithms built into their system, but rather than, say you need to target first-time moms for your customer, okay? So rather than going into Facebook and targeting first-time mothers, because that would be expensive, they use their technology to figure out well okay, what other words are highly correlated to first-time mothers? And maybe for example, Peppa Pig. Peppa Pig might be highly correlated to first-time mothers. Now what if you can find 30 Peppa Pigs and it only cost a penny to bid on Peppa Pigs? Right? Where it cost 50 cents to bid on this. So rather than bid on this, you're now bidding on all these and you're spending just a small portion of what you would have spent doing it the other way.

- What are the obstacles to native advertising? And what I mean by that is like I think about the future of online advertising, you think about the archaic model of using cookies. Like, if not to be too cliche, but if the cookie crumbles, if that stops being a major mechanism to enable personalized advertising, doesn't the industry go away? Like if you look at native advertising, what are the things that maybe are blockades to its continued rise?

- So I think the biggest blockade is simply our mindset today. Now this is starting to change, but let's look at television advertising executives. Television advertising executives, for every one dollar they spend on creation, they're spending five dollars on distribution. Do you know what the average content marketer does?

- [Paul] 90% on creation?

- The complete opposite. And I've done research and it told me this. I'm just not making this up. But it is starting to change. There are some exceptions now. So we as marketers, we need to start thinking like television ad executives, because the age of build it and they will come is over, for most industries. And let's say you're a snail farmer. If you're a snail farmer you can do the old in-bound marketing, build it and they will come, organic only, throw some keywords in there, and you'll do fine. But that's about it. So we gotta change our mindset.

- Yeah, we always tell people, and I think for a lot of our clients it's been a shift, and I'll tell people in the proposal process before we even take them on as a client, you're gonna spend 8,000 a month with us on creation, you need at least 8,000 a month in promotion, but ideally far more than that, but it has to at least be a 50, 50.

- Yeah. Now you can make up for some of that through the earned media side, so influencer marketing is one, media outreach. If your executives have bylines on say, Ink.com, Forbes, Huffington Post, wherever, so that could go a long way too for that. So are you guys doin' any influencer marketing?

- It's so funny I feel like that's one of those buzzwords that is just PR but we call it influencer marketing 'cause it makes for better blog post titles. I actually don't know the answer to that question. Including what influencer marketing is. I think we do, but I've never actually sat in on a session on influencer marketing, but I think it's what I learned to do in college as a PR major.

- Yeah. So PR, media outreach, I like to tell my students the first day of class, that the internet has put the power of the media in the hands of every human being that has access.

- [Paul] Of non-media, basically.

- So in that regard you're exactly right.

- So it's PR but not to the media gatekeepers, it is now to the average person who now has a following on Instagram or wherever and it's understanding, yeah. So no actually, we don't do a ton of it 'cause we don't have a lot of big brands. Like I think my perception of influencer marketing in that sense is consumer brands were probably the most logical starting point. Like the audience is being built around say the fitness industry or things like that where there's just these natural people build massive followings. In the B2B space, I guess we've probably done it. Again now that I think about it within the context of the definition, like we've run webinars for B2B software companies, where we've brought like Jay Barron as a guest speaker, and like you leverage the reputation that those people have built up as a way to draw audiences and leverage their audience and so yeah, I guess yes, we do some influencer marketing.

- So it's interesting under the native advertising umbrella there's a section called influencer advertising. So where you actually pay influencers--

- Like Kim Kardashian?

- Like Kim Kardashian. That's one version. But there's solutions for micro-influencers where they have maybe 2,000 followers, but you scale that and you pay 'em a little bit for interactions. There's some where they actually pay in Amazon gift cards. Where they pay in like a point system where they can cash those points in.

- Are there software companies built around influencer marketing? 'Cause I know like Buzzsumo has an influencer search function where you can look for authority based on keywords and things like that.

- Right but these software companies that I'm talking about facilitate some type of quid pro quo. Buzzsumo doesn't do that.

- No they're just database.

- Discovery, yeah. But what's cool about this is Disney's in the game now. Disney has their own influencer network. The New York Times has their own influencer network now. So it's really starting to spread.

- I did see a cool one, application again on the consumer side. Million Dollar Listing, I have like it's an obsession. There's very few shows I still DVR and watch, but that's one of them, and in that case, Million Dollar Listing, Ryan I think did it where they were trying to sell a loft or a penthouse in New York and so they just went and found like the 50 people who are photographers in New York who just average consumers who love to take photos in New York, they found the 50 people with the biggest followings on Instagram and they invited them all for a private showing and that was influencer marketing. They spread the word about it through those people instead of a standard broker open. That's awesome. So I was telling my wife, I was like, "That's kind of what I do." and she's like, "Oh, okay." 12 years later she doesn't know what I do.

- The first time I got exposed to it was believe it or not here in Cleveland, I just moved here. And I was invited by the Cleveland Indians to attend a game against the Yankees.

- [Paul] The social media suite?

- In the social media suite. And all they wanted me to do was tweet and Facebook about my experience. And there was a bunch of other people there.

- And the Indians were like a forerunner in that. They kind of started that movement. I remember actually at the first Content in Marketing World I moderated a panel where we had one of the heads of communications for the Indians, the Cavs, and the Browns and we were talking then about what the Indians were doing on the social media side. 'Cause they weren't a World Series Team seven years ago, and so they were struggling to pull people in and social media was one of the ways they tried to do it.

- Yeah, but that was my and I didn't--

- [Paul] That's cool.

- I wasn't aware at the time, I was just, "Cool, free game. I'll go."

- [Paul] Yeah, and they used to do it in the bleachers and then they moved it to a suite, and they actually had a social media suite and--

- Yeah, yep.

- [Paul] That's awesome.

- So what else do you have on the horizon?

- A lot of it's AI stuff. Yeah, that's the majority of it. But we're also working on some stuff on the agency side so you know my first book was The Agency Blueprint. And then we never built a business model around that though. Like we put the book out, did some online education, that was 2012 and then that was it. Like we had marketing agency inside or a separate site dedicated to agencies, that we don't do much with but we keep the lights on basically. But we're in the process now of taking some of the proprietary processes we've built, like our point pricing model and our marketing growth hackathon strategy model, and we're working on licensing models for that. We're actually gonna do online education and then enable other agencies to take and run with those programs. Give them materials, how-to's, things like that, so a lot of my time's on the non-service revenue side. Like these new initiatives that aren't--

- The fun stuff.

- Yeah it's the more scalable stuff honestly.

- Yeah, so are you working Agile into any of that stuff?

- Agile was part of the inspiration behind the points model. We don't follow Agile in the sense that Jeff writes about Agile, but in 2011, 2012, actually it was right after my first book came out, we were working on building software for the first time and so I was doing a lot of research into Agile development to aide in the building of our online assessment tool, and somewhere between that, and it's so funny I can go back through every note of the chronology of how this all transpired. But I was on a flight to Texas, I was always trying to find the single value metric that people buy from us, so it's not a blog post, it's not an hour, like what is it they're buying? And I wanted a simplicity of a SaaS model. Like with HubSpot it's number of contacts, with Basecamp it's number of projects, with Wistia it's number of videos, with Dropbox it's number of megabytes of storage, and so I settled on maybe we standardize it as a point. And the point is universal, so a blog post is three points, and email is two points, and a landing page is three points and sort of become this standard service guide of point values and that was the origin of point pricing. So then we spent like, I don't know, 12 to 18 months building out the whole model, like how would we price it? How would we roll it out to clients? How would we move our legacy clients over to it? How would we adapt our project management, our time track, and like everything that went into it. So we spent a lot of time working it and basically what I did is I wrote it up as a here's what I'm envisioning, here's a Q and A of what I expect everyone to ask, and then I turned it over to our leadership team in the agency. I said, "Tell me I'm crazy. "Like shoot holes in this concept "before we ever even think about going to market. "Like what am I missing here?" And so we went through iterations of that internally where the senior team was able to actually then collaborate on the building out of the model. And then we started in January of 15 rolling it out to new clients. And then somewhere in mid to late 2015 we started then, we did a two year regression analysis of what would clients have been paying per point had they been on the point system, and then that was what we grandfathered them in at. So we have some clients still paying insanely low price per point rates. Like in some cases half of the market value of them today, because that's what we grandfathered them in at. We honored that.

- Well I have some experience with that myself. I've been using HubSpot since 2010, and I'm so grandfathered in that even if I were to drop to their lowest solution, it would still cost me more than what I'm paying for Enterprise.

- We got our first HubSpot licenses in 2007, and I put my wife's art business website on one and I won't even say what we're paying for that one because HubSpot may have to go in and have to change the system around a little bit. That's funny.

- Yeah it is funny. It is funny. So you've got another book on the horizon?

- I haven't signed anything yet, but we're likely working on an artificial intelligence book.

- Awesome. For marketers, right?

- [Paul] Yeah.

- Okay.

- It's been, and honestly I've been working on it for three years. But what happened was last summer when I went to actually try and write it we realized we didn't know, I knew kind of where I came from. I had a pretty strong belief I knew where I was going, but I actually didn't know the middle part of the story of what do we do about it now? And so the Institute became our discovery process to try and figure that out. Like if you're a marketer and you want to get started how do you do it? Where do you go? And so building the framework of the types of artificial intelligence that exist and being able to understand what's possible with it, that's what we've spent the last, guess probably 10 or 11 months figuring out. And now I feel like I could probably tell the story that I wasn't able to tell this time last year.

- So are you actively recruiting contributors that know about AI?

- If you can find any let me know. But we're building a benefactor program right now and the general plan is the benefactors will have the ability to contribute guest content, but up til now we have not published a guest article.

- Gotcha.

- So it was a very closed system. Instead of tryin' to get just get a ton of content we went for let's figure this out, because honestly nine months ago I couldn't have even edited somebody's AI content and known whether it was BS or not. Now I can look at 'em and call BS on stuff and if we don't think it's legitimately AI.

- Gotcha, gotcha. Yeah, as you know I helped co-found relevance.com. It was the first website or digital publication dedicated to content, promotion, news, and insights. Now we--

- [Paul] We created some content for it if I remember correctly.

- Yes, yes. We actually, so we sold it. I'm still affiliated and participate, but I think we, we were able when we sold it I think we had around 343 unique contributors,

- [Paul] Wow, that's--

- over the time and as you know we won a content marketing award for subscriber growth, but we recently sold it. And they're still actively recruiting contributors. So we're still tryin' to build that community and it's exciting, and you're doing the same thing with your artificial intelligence.

- Yeah so many people have followed that model. I mean like CMI has obviously through the years done that. Now a lot of the major media outlets, like even Forbes and like they're opening up the contributor networks. Huffington Post obviously built their model on it. And we may go in that direction at some point, but honestly we were just in the let's prove the market exists mode and let's create as much really good content as we can, and if it attracts an audience and starts building a subscriber base then we'll put our chips in. And that's, we've seen enough now to know, now is the time to move on it, so we're gonna put more resources behind it and start building it up and putting a business plan in place.

- Yeah, yeah. So we're at Content Marketing World. We're in Cleveland. You're from Cleveland. I lived here for two years from 2010 to 2012, in the suburbs and I was working ridiculous hours. I barely made it down here. So what do you want to tell people about Cleveland? And next year when they come to Content Marketing World, what should they do?

- I mean for me it's just been an incredible Renaissance. I grew up in Cleveland so I actually grew up in the city. Probably about five miles outside of Cleveland, five, seven miles outside of Cleveland, so in the city proper. And where I grew up isn't a great place anymore. Like it changed over time, but what ended up happening is the urban core revitalized over the last decade and in incredible ways. So ten years ago we didn't have for sale housing in downtown Cleveland. There was no wait list for apartments, there were no new hotels going up. And in the last 10 years, I mean I think last year in the last 18 months, I think six new hotels opened up here. So the Republican National Convention being here last year was huge. That was the largest event I think we've ever held. And so you had north of 50,000 people come in, and the city by every standard I've seen, every article I've ever read, shined. Like there was New York Times and Washington Post, they did incredible articles about the food scene, the arts, the culture, the performing arts center, the museums, the metro park system, the waterfront. Like there's so many things here people just don't even realize. I ran into a guy last night at the, one of the events and he said last year was his first time here in Cleveland, and he brought his wife with him. And they went to the art museum and they went over by the University Circle, and he said when he told his wife he was coming back, she said, "Can I come?" Like there's other stuff I wanna do in Cleveland. He's like my friends think we're crazy but we're actually like staying extra days to go over to East 4th Street, and to go over to the museums. Like that's, that's awesome. Like I think last night doing the Rock and Roll Hall of Fame opening, it was such a beautiful night and I think a lot of people came to Cleveland for the first time were probably in awe of the lakefront and everything that's here. 'Cause it really is a beautiful city that has seen an incredible turnaround in the last decade, so for me and for a lot of Clevlander's I think we all take immense pride in what the city's been able to accomplish. And for those of us like me who chose to build a business here, 'cause you could leave like in the early 2000's, there was a realistic chance like if you were starting a business you were gonna go somewhere else to do it 'cause you didn't really wanna try to do it in Cleveland. And my feeling was always if we were gonna build something significant, I wanted to be part of the solution not part of the problem. So I didn't wanna leave. I wanted to bring people here, so I think that's the Cleveland we've all come to know and love is, it is, it's everything LeBron wrote about in his letter back. Like if the Sports Illustrated letter about you know, nothing's given, it's earned kinda thing. It's the true spirit of what goes on here. Whether LeBron stays or not, I don't know.

- Is he staying?

- I don't know. I don't think LeBron knows if he's staying yet.

- What are the Vegas odds, you know?

- I do not. I would say it's 50, 50 right now though.

- Okay. Okay. So who'd you have your money on the other weekend? Mayweather or McGregor?

- I did not watch and I actually didn't care.

- Didn't watch? Oh it was a spectacle. It was quite entertaining.

- I checked Twitter at 1 a.m. and found out who won.

- Nice, nice.

- How bout you? Which did you?

- You know I didn't really have, I knew Mayweather was gonna win. I just wanted to see a train wreck. That's all.

- You didn't get a train wreck though right?

- I did a little bit. It was a little train wreck-y. For sure, for sure.

- It was good marketing, that I know.

- I was in awe by the marketing.

- Yeah, it was amazing. That's probably what we could take away from that, it was pretty incredible.

- Yeah, that's what I took away from it. For sure.

- All right man well, should we get back to the show?

- Sure.

- Always good to spend time with you brother.

- Definitely.




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