Subscribe
Share
Share
Embed
Welcome to “It’s Marketing’s Fault”. If you are a marketer, this phrase is familiar to you. Sometimes deserved, often times not.
Don’t worry, you are among marketers and friends here. Let’s discuss how to do marketing the right way.
As a side note, in episodes 1 through 37, this was Build That Podcast. The goal of this podcast is to help you learn how to use a podcast to grow your business and expand your influence. If you go back and listen to earlier episode (those before November 2023) you will hear that name. Don't worry--it's good content too. :)
Nick Martin [0:00 - 0:54]: What I would tell you is that what we're experiencing firsthand is over the last two years, there's been a very consistent progression that is moving away from fear and even awe into practicality. And so chat GPT took the world by storm, November 2022. I'd say the first six months after that were, we got to figure out what this means. We don't know what to do. It hallucinates. We're a little worried. The years since then, last summer to now, most of the senior executives that we work with or talk to have moved into, we understand that this is happening. You can't put the toothpaste back in the bottle. We want to be on the front foot. We don't want to be reactive. We don't want to be the newspaper that didn't build a website until 2009. We don't want to be the digital media brand that didn't get on social until 2018. We know we need to be playing offense here. And they were very sober about that.
Eric Rutherford [0:54 - 1:20]: Welcome to it's marketing's fault, the podcast where we discuss how to do marketing the right way. I'm your host, Eric Rutherford. I'm thrilled today because I have with me Nick Martin. He is co founder of Direqt, the leading conversational AI platform for content publishers and creators so they can build, grow, and monetize their own branded chatbots. Nick, welcome to the show.
Nick Martin [1:21 - 1:22]: Thanks for having me. It's a pleasure to be here.
Eric Rutherford [1:22 - 1:30]: Hey, it's my pleasure. So I've got to start by asking, what is a branded chatbot?
Nick Martin [1:30 - 2:37]: Yeah, I think, like, rule number one to these questions is you're not supposed to use the name of it in the definition, so bear with me. Right? But it is a chatbot that represents a brand. So think of any brand, whether that's Nike or Walgreens or Best Buy or Amazon or Apple. It is their chatbot that allows the audience or the user to interact with them. And so for Apple, they built their own. It's called Siri. For Amazon, they built their own. It's called Alexa. OpenAI has one. It's called chatgpt. Right? We power those for the biggest media and entertainment brands and content publishers in the world. And if you think about what brands care about today, it's usually having a direqt relationship with their consumer, their customer, their audience. And that's become paramount, especially in a world where algorithms get in between a business and their customers. And is certainly true for the customers we service in the media industry. And so we think of it as like, well, if you want to have a relationship with somebody, you probably need to be able to have a conversation with them. If you think about the way the real world works, you've probably never had a meaningful relationship with anyone that you've never had a conversation with. And so we power the ability for brands to have conversations with their audiences through AI and through a chatbot that the user can interact with.
Eric Rutherford [2:39 - 3:17]: Okay, so I gotta confess, I had not thought of Siri or Alexa as a chatbot. I don't know why I had not, or even chat GPT, but that makes sense because I'm thinking chatbot, like the little customer service. Customer service, right? So just you saying, wow, Alexa's a chatbot, Siri is a chatbot. Like, chat, like, all of these are just a front end voice for that. So then it sounds like this is more than just like the little thing that pops up on your website. This could be anything. Is that kind of the feeling I'm getting?
Nick Martin [3:18 - 5:08]: Yeah, I think it's, in our version of the world, it is the way that a brand manifests itself to interact with consumers at scale. So today, you can't talk to all your customers if you service even a thousand, let alone millions of users or customers, whatever it might be, and conversational AI, a chatbot, an assistant, a companion, whatever you want to label it as allows you to do that. Siri, again, they might call it an assistant. The nomenclature is sort of interchangeable, but it can be whatever your brand wants it to be. To engage an audience through a conversation, that's the one through line. All of these, even those customer service chatbots that you might be familiar with from your airline or Internet provider, what they're trying to do is engage a customer for some purpose in a conversation. Now, customer service is a really narrow use case that I think is pretty well understood, because everybody's seen those for the last ten years. What's new today is that because of LLMs and generative AIH, a brand can now actually have almost an infinite number of potential conversations with the user. The user can co create what that looks like. That really unlocks all these other use cases that were previously not really accessible to brands. The only thing you could do pre generative AI really taking off over the last two years was customer service. That's why we're familiar with it, because brands were able to deliver an okay customer service experience ten years ago, because he didn't need a lot of AI, the audience, the customer has five or ten common questions. You answer them automatically. You don't really need AI to do that. Maybe it's not the best customer experience. They end up handing you over to a human who you have to talk to on the phone, who then makes you answer the same question sometimes. Nevertheless, we think of that as what chat was pre generative AI, and then today it's becoming much more than that. That means better customer service. AI's for the brands that use it for that purpose, but also just a much wider range of potential use cases for the audience.
Eric Rutherford [5:09 - 5:58]: Yeah, it really does. And that's kind of my experience is dealing with sort of the pre AI or what we think of the classic chatbot, so to speak, in terms of asking like, you've got a set number of questions, and when you run out of answers, they say, hey, why don't you talk to a customer service rep or something of that nature? So I appreciate that distinction and how it is. It's how a company can have a conversation with their customers. So I got to ask, because direqt's been around now for a few years. How did you, what problem did you decide? Okay, this is. I see this problem. So we're going to start direqt so we can address this problem. What was that sort of momentous?
Nick Martin [5:58 - 7:39]: Yeah, it was actually just a hypothesis on where the world was going, which was that AI was going to get better and better. And as a byproduct of that, the ability to interact through conversation. Right. Having a conversational interface where you can type in whatever you want and get a response back is actually going to work for the first time. And that if that was true, if AI got so powerful that you could interact with content through conversation, that the way people discovered content, the way they consume the content, the way they engage with content would fundamentally change. And that if that happened, that the people who create content, so individual creators, big media companies, everybody in between, would need new tools to create the content experiences in that medium, to distribute them, to get them in front of audiences, and then to monetize them. And this was somewhat informed just by seeing what happened from how audiences shifted going from desktop to mobile, which was really just a different form factor, it's just shrinking down the same experience. Whereas if you think about a conversational experience where the user sends a message into the brand, it's going to come up with something dynamically that is really co created and based on what the user is asking for, that's a very different problem to solve. It's much more in depth. You have to be much more thoughtful about what you build there. We set out to build the end to end platform, you can create your own AI, your own assistant, your own chatbot. You can distribute it to get it in front of your audiences and have conversations with them wherever they want to have conversations with you, then monetize it so that if your audience does move into the, the conversational medium, in addition to the incumbent web and app mediums that people spend time in today, that you're still able to drive meaningful revenue from it. And so that's what direqt is. It's this end to end AI publishing platform that helps creators build, grow and monetize conversational AI experiences for their audience.
Eric Rutherford [7:40 - 8:06]: So let me ask, just on the revenue side. So when you're able to create this experience to generate revenue from it, what does that look like? Just on a, on a general scale? Is that being able to sell products and services? Is that being able to connect brands with your audience? More like an advertising affiliate? More just brand recognition? What's that look like?
Nick Martin [8:06 - 11:19]: Yeah, it's a great question. So we looked at where the existing revenue for publishers was most meaningful and then we worked backwards from there. And so today, advertising is the primary way that content companies generate revenue. They also make money through commerce or affiliate, where they recommend or sell products direqtly to their audience. Also make money through subscriptions where you pay for access to premium content. There's a couple other ancillary revenue lines like throwing events and things like that. And over time, direqt will have offerings that enable publishers to drive revenue any way they are to drive revenue today. So across all four of those and maybe more, the first thing that we tackled was advertising because that is the bulk of the industry and the business today. And so that's the most important thing to get right. So for example, direqt has a partnership with Microsoft for what they call a chat ads API. It's effectively a new product completely built to monetize a conversation between a creator and their audience. And so for example, if I'm talking to a fashion publisher about the Met Gala, and I happen to ask them what dress Kim Kardashian wore last night, and they tell me, and I might say something like, wow, that's so cool, I can't afford that. Are there any dupes? Dupe will get cheap knockoffs. That is pretty much like a search query. They're actually explicitly giving us intent to say, I'm interested in buying a dress that looks like that, but costs less. And just as if we were Google on the publisher's behalf, we can actually pull in a relevant ad, show it to the user, and if they decide to click on that ad and make a purchase, we'll generate revenue and share that with the publisher. And that works across a whole host of different types of advertising experiences. So we can monetize the impression just somebody seeing the ad, the click event, just like search. And then if you work your way down to commerce, you could take a revenue share on the product that's sold. And so that's the first focus for us is getting the in conversation advertising experience to be great for users and be really relevant because that drives performance over time. And then you can imagine the ability to upsell somebody and do a premium content subscription where you're in a really in depth conversation with maybe a sports media company where you tune in to get analysis and insights in your favorite NFL team. Maybe you start asking them for recommendations on bets you can place during NFL Sunday this upcoming week. Maybe it's even halftime at the game and you're like, hey, it's half time. I lost my first half bet. I got to make up for it. I want to bet on the Ravens game because it's the only game they're showing at the bar and I'm trying to have some fun. What should I do? And that AI can go look at the live scores, the live odds, the fact that it's going to rain in the second half, the fact that they're up by seven and when they're up with a lead at halftime, they run the ball 30% more in the second half and go, Eric, I think you should probably place a bet for Lamar Jackson over 27 and a half rushing yards in second half based on all these factors, which is an incredible experience. It was never possible before. That would have taken you 45 minutes of research. And then at the end of that, maybe they get a commission on you placing a bet, but maybe they go, hey, Eric, for unlimited access to these types of insights, you can subscribe for $5 a month to our premium content, which includes unlimited conversations with the AI. That's where things might be going in terms of a subscription offering. Again, there's a host of other ways you could drive revenue that makes sense.
Eric Rutherford [11:19 - 11:43]: That really does, because I've seen different things of that nature, just from a content perspective anyway, whether it's email, whether it's something else, it's like, okay, you're getting the general information, but if you want more, if you want to go more in depth, if you want to do coaching, if you need some whatever, then here's the other on the upsell offering, it's just making it in a more dynamic way.
Nick Martin [11:44 - 12:17]: Yeah, exactly. What's old is new. It's not reinventing the wheel. The way to generate revenue from content is very well understood. It's quite mature. Maybe the emphasis changes. Maybe the medium is so engaging that it unlocks more potential from a subscription perspective. There are new experiences that you can deliver that weren't possible before, like the sports betting recommendation I just gave. And so that could drive improvements in your ability to convert an audience member into a customer by way of premium content or otherwise. But it's the same things that already happened today, just maybe at a different scale.
Eric Rutherford [12:18 - 12:38]: That makes sense now, what kinds of companies use these type of chatbots? You've mentioned several. But who are the companies, or even if not brands, like sort of the size, shape, texture of companies, so to speak, that, you know, that would use these.
Nick Martin [12:39 - 18:25]: So our view on the world is every brand will have their own AI that represents them. And again, that might be what we think of today as a chatbot or an assistant. It could be a little more involved than that over time. And so I'll give you a couple examples. The thing that's happening with customer service will continue to happen, and we'll get better. If you are familiar with the company Klarna, buy now, pay later. You know, fintech business, that's quite large. They put out data a few months ago that suggested they could automate 70% of their customer support inquiries through AI. Now, the CEO of Klarna called up Sam Altman a year ago and said, hey, I want to be your guinea pig. I want to be the first customer for everything. We're going to deploy it fast. We're going to be your way of testing things in market. They might be a little ahead of things, but what they did is not unique or novel to them. It is something that will be replicated. Customer service will just get better. And every business outside of content companies primarily has customer service. So that'll be really mature and deployed across the board. And I think people will move into a place where they're comfortable talking to these AI's for service because they'll be good enough to meet their expectations most of the time compared to maybe what they're used to today. Then I think you'll have marketing. So you'll have Nike and Adidas and Starbucks that'll have these AI's that you can chat with. And maybe that's to place an order and you get loyalty points. Maybe it's gamification around the shopping experience to deepen engagement with you, it could be them buying ads. So 40% of advertisers on meta today have tested running ads, or the destination of the ad is a chatbot. And so what that means is traditionally you buy an ad anywhere, but let's use meta to stay with the example. And when the user clicks on the ad, they go to a landing page, a stripped down website that is purpose built to convert somebody from an ad campaign. What these advertisers, 40%, so 4 million out of 10 million, so quite significant scale have done is when the user clicks on the ad, it actually takes them into a chatbot in Messenger, Instagram, DM's or WhatsApp, depending on where they found the audience, across Meta's three platforms. And the chatbot is the landing page. It says, oh, hey Eric, and it knows the ad you clicked on, and it might know a little bit more about you, and then it's going to send you a message. And they've shown that, that conversational experience, because it's more personalized, because it's more relevant, because it's more natural for the user. You don't have to go scroll through this long page and read everything. You just get to text somebody, just like you do with your friends and family, converts people better than a landing page. The Roas is stronger. And so 50% of those advertisers that have ran a campaign that points users at a chatbot now exclusively are running ads that do that. So that's really impressive performance to take two out of 4 million advertisers and move their default advertising behavior on one of the two biggest advertising platforms in the world to be driving users into conversation. So meta calls that click the chat, it's a huge initiative for them. It's also how they're monetizing the WhatsApp audience, which otherwise wasn't being monetized. So that's a huge part of it. And then what we do is on the content side. And so again, that could be, I go to the media company that broadcasts the NFL games and I'm interacting with them in the game to get stats and updates and insights and predictions. It could be going to a fashion publisher and asking them to, you know, help me pick out an outfit based on my appearance and what I want to look like this summer. It could be everything in between. It could be getting more insight and nuance in what's going on with the news and the political landscape from the newspaper that I trust and everything in between. We think it's going to cut across the entire business landscape, and then the places people interact with these AI's will be anywhere they already spend time. So when you go to a business's website, you'll see the AI, the chatbot you're used to, but it'll be able to do more. They'll start texting you when you opt in and say, hey, Nike, I want you to send me a text. Hey, ESPN, I want you to send me a text. And then they'll also engage with you across social. So we did an integration with Instagram so that our publishers, for example, could send you a DM based on what you commented. So if you commented something that would show intent, that you want to have a conversation or you want more information, you asked a question about something, the AI can send you a DM and answer your question for you and then engage you in that DM, just like you do where you spend time with friends and family. And Adam Masseri is the head of Instagram has said teenagers spend more time in the DM's on Instagram today than they spend in the feed. Right, is where teenagers are spending the most time. And so now brands are going to be able to have access to that channel to interact with audiences one on one at scale, and then potentially, and we'll see what meta does here. But they showed their hand a little bit this week that they'll probably allow you to be part of group chats. So if me, you and two of our friends have a group chat where we do whatever, we shoot the shit about sports, we hang out, we catch up, we do nostalgia, whatever we're doing, we can tagore an AI in the middle of our conversation. It can just jump in and be part of the conversation with us. So that exists with metas AI, which is called meta AI today, and you can do that and use it as a search engine and an assistant, a chat GPT type experience, you could imagine a really wide range of use cases where me, you and your two buddies want to settle a debate we're having, and we pull in the world's most renowned sports media brand to get their hot take on if Jordan's better than LeBron and we can say no, show me the statistics of how they played in year 17 of their career, because that's the central part of the argument that we've gotten stuck on this group. And so we think that'll unlock a ton of engagement for a bunch of reasons, one of which just being that people love talking in private and they don't love talking in public, right. We don't like public speaking. If you're in a work meeting with your colleagues, you kind of hold back. If you're at the bar with your best friend, you're very open. If you're in a group chat with your two buddies, you're really yourself. Brands will have permission to enter that space and users will invite them in. They don't just show up. And I think that'll be the cohort of the audience for a brand that's most meaningful to them, because you're only going to do that with the brands you really love and trust and get value from.
Eric Rutherford [18:27 - 19:20]: Wow, that's mind blowing. But it's logically the next step in the progression. It really, you know, from, you know, if you can go from Google to, you know, to Alexa to, you know, this, this next version of Chatbot or, you know, assistant, again, whatever you want to call it, it's a natural progression. So I gotta ask, if I'm thinking Google, and I'm thinking even something like chat, GPT or Claude, or even like perplexity, how does something like a chatbot that's branded specifically for your company, what does it do better than some of the other functions out there? Because I think some companies are probably out there saying, well, yeah, but if they want to find that stuff in my content, all they got to do is Google, or why don't they just use our website search engine?
Nick Martin [19:20 - 19:23]: Yeah, I'll refrain from comment on the website search engine.
Eric Rutherford [19:23 - 19:25]: I had to throw that in there just in case.
Nick Martin [19:25 - 22:31]: There's a lot there that we think could be done a lot better. And I think the best data point on that is if the biggest search engines in the world, that is Google, are overhauling their core user experience to be AI first. With AI overviews, we think it's likely that every business, publishers included, will change their on site search experience to be AI first because it's a better experience. You can sort the information better, you can provide relevance and give the user the answer. You don't have to force them to click around, you can get them to do both. And turns out when you give people good information, they actually want to go down rabbit holes and consume more content. So it's actually a win win there. The thing that for our customers, the publishers of content. So media, brands, broadcast networks, magazines, newspapers, think, the New York Times, the ESPN, the Washington Posts, the Forbes of the world, those are the types of companies that direqt serves. They have an audience for a reason. It can be that they have unique insights that nobody else does. It can be that they've built up trust with an audience. It's that they have great journalists that do a lot of investigative reporting and research. And so when you go chat with them, you can know that 100% of the content you're getting back from the AI, the answers you're getting, the conversation you're having is rooted in actual human produced content. And as amazing as chat GPT is, and Gemini and meta AI, and we work with all those companies. I'm a user of all those products. They're phenomenal. One of the things that they do a lot is they either hallucinate or they source information that's not high quality. So that could be including an answer from a comment on Reddit instead of prioritizing something that was like, investigated for hours and thoughtfully reported on and had an editor review before it went out. Again, that's a feature, not a bug. I think for most of the use cases of the big mainstream, horizontal chatbots like chat GPT, that's a good thing. They're not trying to replace the media industry and content publishers and content creators. For our publishers, they offer trust, they offer reliability. They also offer a perspective or a personality. Right? You might really like that. Kara swisher has a strong take on things and speaks her mind. And you might want, when you interact in the conversation, to get an opinion that's built off of her content from her. And that's no different than why people listen to podcasters as an example versus not so individual people. Andrew Huberman, as an example, has become really big in sort of health and wellness. Most of the information he's putting out there already existed. Right. He's typically citing research papers that are generally publicly available. Most people don't want to necessarily go read research papers, but they found that his style of communication, his delivery, his ability to explain things in simple concepts, resonated with them, made it easier for them to digest the information. Sometimes that's simply just like marrying entertainment with informative content and education. But there's a lot more flavors to that. And that cuts across everything from lifestyle to news, to finance and tech and sports. And so the biggest differences are point of view, personality, tone of voice, and then quality of the content, which is really, really important.
Eric Rutherford [22:33 - 23:36]: And that makes sense. So if with, especially with content companies, with their assistant, their chatbot being able to access their archives and their data, that is your source. Suddenly, yeah, that changes the scope of things suddenly. It is very much a huge research tool for that. Or I like how you described opinion, and that was really interesting, that idea of that brand and voice, because it sounds like then companies, if they don't already, they will be able to come up with their own true voice and personality and brand that will engage with customers. Are companies realizing that's possible? Are they afraid of it? Are they excited about it? Because I can believe there's got to be at least some executives going, oh, no, no, no. We don't want to do that. But I'd love to hear your take on it.
Nick Martin [23:36 - 29:02]: So it's always both, right? The world's not black and white, it's gray. There's always a little bit of everything. What I would tell you is that what we're experiencing firsthand is over the last two years, there's been a very consistent progression that is moving away from fear and even awe into practicality. And so chat GPT took the world by storm, November 2022. I'd say the first six months after that were, we got to figure out what this means. We don't know what to do. It hallucinates. We're a little worried the year since then, last summer to now, most of the senior executives that we work with or talk to have moved into, we understand that this is happening. You can't put the toothpaste back in the bottle. We want to be on the front foot. We don't want to be reactive. We don't want to be the newspaper that didn't build a website till 2009. We don't want to be the digital media brand that didn't get on social until 2018. We know we need to be playing offense here, and they're very sober about that. And maybe it's simply that we all lived through sort of the Internet and then mobile and then social in particular. And today's executives have, like, pattern recognition across one, maybe two, maybe three cycles where they kind of can see this is happening. And so it's really not as much of an uphill battle as maybe one might assume to get these huge brands on board with this idea of, like, you need to have an AI that represents you to engage your audience, and you want to layer a unique personality tone of voice perspective there. Now, the good news is they already have those things. They already have a personality. They already have a brand identity. They already have a perspective and a voice. It's why they're big businesses today. Manifesting that inside of a conversational experience can be simple, but it can be also nuanced. So, for example, if you're a brand that has, let's say, 100 journalists, your brand voice might really be more of like some synthesis of those hundred voices together. If you zoomed in on any given reporter, any given writer, any given analyst, it might be a little more clear kind of what the voice is, because it's just one person talking. One of the things that we're seeing is as we've started to build out capabilities to make it easier to create your own personality for your AI one, it automatically adopts the personality and perspective of your content. So out of the box it's representative of what you're already putting into the world. But then you can go in and say, you know what? I want the I'm a sports brand, my fans are diehard. I want the AI to talk as if it's a die hard fan. I want it to be abrasive when they're talking about the rival teams. I want it to use emojis, I want it to be witty and make jokes, and I want it to really feel this certain way when, when publishers have done that. In our platform today, we see engagement double, triple, quadruple in terms of the way the audience uses it, because it's more fun, it's more interesting, it's more engaging, just naturally. And so mainly because the data is showing it works really well, we have a pretty high level of conviction that this will become more of the norm and less of the exception over time. It's definitely one of the newer features or capabilities that's being adopted. I think again in the first year post Jack CPT 2023, it was more let's get our arms around the technology, let's play it safe, let's have a really narrow, simple experience to start. And then now, as the market is learning and evolving, everyone's going, well, where do we go from here? And the best example in terms of how most companies tend to adopt new mediums, new formats, new types of content, new audiences is going back and looking at things like the first television ad was a radio commercial with a picture. It was literally a radio ad with a picture in front of it. If you go look at the original websites, they're like PDF printouts of the newspaper. If you go look at the early posts on social, they're like screenshots from websites shrunk down into a square. Normally what people try to do is take the old thing and squeeze it into the new thing. And normally why they're doing that is it's just like a simpler way to get started. It's not some lack of understanding, it's just the easy thing to do. First. And it's good to start with something simple, something digestible, something an organization can sanction and get behind. And then as you do that, you just are confronted with the data and the capabilities and you start to understand what the audience cares about. And then everything opens up. And so I don't think 15 years ago, if I would have sat here with you, Eric, and been like, yeah, so this thing called Twitter that just came out, you know, whatever, let's back up a little longer than that. But imagine it's 2007 or eight and Twitter's brand new. If I were to tell you that Wendy's was going to use Twitter and all of social at this point to make fun of McDonald's and, like, harass them and put them down as if they're like high school kids, you know, verbally sparring in a cafeteria, that would have came across as crazy, right? But that's really common and in fact, across, like, the fast food category in general, when it comes to social, like, it's a very much meme culture, make fun of each other, roasting type of experience that is not necessarily from the tried and true playbook of how you do branding. That is something where the brands actually started to understand. Like, here's how people want to experience our brand in this world of social. What's the right thing we should do here? And they widen their periphery in terms of what they're comfortable with. I think that'll happen with AI experiences, too.
Eric Rutherford [29:06 - 29:56]: And I like that. That makes sense. And this idea of giving it the voice, giving it a personality. So and so, I'm thinking Fortune 500 companies versus startup small business, moving towards medium sized business. Different perspectives, different purposes, different audiences. Is one side more likely to go this way? Do you think the smaller companies are just going to adopt it, like out of the gate? I just. I'd love to hear that, you know, your perspective on the differences or similarities between, between those two, because I didn't know, you know, the more stockholders you get, the more shareholders you get, the more vanilla the voice becomes. I just love your take.
Nick Martin [29:56 - 33:13]: So it's a really good question. We focused on the biggest, most premium publishers in the world. The biggest media companies you've ever heard of are our customers today. What's happened over the last six months is smaller creators, smaller publishers, smaller brands have seen what we're doing and reached out. So we want to find a way to work together. So we started to, on a case by case basis, take on smaller creators that are more nimble and can move more quickly. And it is the cliche that you would expect, right? They're able to move faster, they're a little more creative, they have less constraints, they're not as tied down in bureaucracy. And this isn't to say that the big guys aren't doing this too. The last point, they really are eyes wide open and trying to get their arms around this thing in the best way possible. And I think social was this incredible training ground for big businesses to really understand how to stay on the front foot with modern consumers. But there's no doubt that when you're a little bit smaller and you just have less red tape, you go quicker and you do more things. So we are seeing that it is the independent creators, the smaller publishers, the up and coming challenger brands that are going, I want my personality of my AI to be sarcastic. I actually think it's good if my brand is sarcastic. To my audience, which is not the most logical thing on paper, it's a little counterintuitive. But if you really think about it, it makes a lot of sense for the right brand in the right context in the right market. So we're seeing things like that. We're seeing, instead of it being the chatbot being named after the brand, it's more of actually what Siri is, where the, the chatbot, the AI is its own name. It's not the apple bot, it's Siri. And we're seeing that's more common at the mid market, if you will, as well. And now it's producing really good results. And then you share that data with the big enterprise publishers and they go, oh, that makes sense to us. I've got some data which helps them go internally and explain to their colleagues why they're doing it. Because a lot of times the executives we talk, they know, like they're super sharp, they get it, but in practice, like, you just want to have a little bit of data to ground your decision in, really to help bring along the rest of your own organization so you can storytell to them on why this matters and then back it up with evidence. And so we're certainly seeing that. I don't think the spread is as wide as one might assume in terms of the way big companies and little companies are doing it, but certainly the smaller companies are moving faster. And again, I use social all the time, as you can tell, as an analogy. But if you think about direqt to consumer and what all these brands that got started on Instagram have done, movement watches comes to mind. They were a direqt to consumer watch brand. They probably launched in 2014, maybe a little before that. I don't remember exactly. That business got to like 100 million in revenue like that. And they did it because they were producing influencer content. They were doing things native for social, they were going direqt to consumer via Shopify, whereas their competition was still like brick and mortar and were too premium to pay this person with 8000 followers to promote us. And that created opportunity. Today everybody does influencer marketing. I don't think there's as much of a window for the smaller creators to compete by being first on new technology as there used to be, but there certainly is still a window.
Eric Rutherford [33:14 - 34:08]: So let me ask, because I'm thinking content libraries. I'm thinking, you know, you think you should talk about content companies. Let me flip over and just talk for and ask you about just if you think of the business to business sector as a whole. So those types of companies, large, small, in between who have content libraries, maybe it's in marketing, maybe it's in other places. You know, we're on a podcast. My mind always drifts a podcast because, you know, that's just where it goes. It seems to me like this could be like a tool that those B two B companies could use, especially whether it's with their sales teams, for potential customers, for any of those that could access their various podcasts and other related content. Are they doing any audio or does it come from transcript? I just love your take on that.
Nick Martin [34:08 - 37:07]: I think it absolutely will happen. I'm not as well versed in the B two B marketing space. We actually do work with some B two B content companies where there's like a ton of value for what we do, mainly because the audience there tends to be really looking to them for expertise, using them as a form of research. And so unlocking an archive that's ten, 2100 years old with a conversational interface has a ton of utility there. And so we're definitely seeing that, unlike B two B marketing. If I'm a software company as an example and I want to use conversational, aih, there's definitely applications. It's not our focus. But you could imagine one you called out podcasting. Really hard to remember the best practice you heard in a podcast last Tuesday in the middle of your three mile run in the morning. It'd be great if you go back to the brand that produces that podcast and just chat with them to basically search and be like, hey, what's the thing Eric said last Tuesday about the way I should retarget my Facebook ads and just get the answer, because the AI has been trained on all the podcast data as opposed to like open Spotify. Try to remember the episode and then start skipping every 15 seconds till you hear half of the word and then listen to it again. So there's definitely something there. Content marketing is obviously this massive industry. I do believe you could do a lot to unlock the value of the content that your brand produces for your potential buyers through a chat interface. One of the challenges with that, I think, will be so many brands in the B two B space have focused on SEO as the main purpose of their content. And typically SEO content is not actually what contains the best information or data. It is so reverse engineered off of trying to rank on search that oftentimes you're like keyword stuffing and it's actually not that insightful. And so the quality of the AI is going to be derivative of the quality of the content. But if you're producing incredible white papers and research and you have unique data and a perspective, and you think if somebody theoretically could consume everything your brand has ever published, and they'd be better at their job or more likely to buy or anything in that sort of realm, then the AI is going to be really helpful for you because it's going to make it easier for the audience to do that. And the new customers that you're going to service today and going forward into tomorrow are going to be people that are using chat, GBT and perplexity and are familiar with this mode of consuming, and they're going to expect that from you as well. And so I certainly think it will have a place. I don't know what like the drifts of the world are doing a tactically around that. I would assume they're well positioned if they're not already doing this from a product expansion perspective. But yeah, I mean, there's a really neat way to integrate the content with lead generation, really naturally. Oh, someone's asking this CRM software about how to integrate x, y and z, and the AI can pop in and be like, by the way, if you sign up for this plan, you get a specialist who's going to do this for you. Oh, now I know that. And that could convert you. So there's like all things in the sort of conversational AI world, there's probably an infinite number of examples, and I don't have a lot of concrete evidence of how much it's happening today, but it's certainly going to be a thing.
Eric Rutherford [37:08 - 37:58]: That makes sense, just that idea of it's seeing the progression the more people become familiar with it, the more they will begin to use it. I want to say I was listening to Lenny's podcast. He's got a newsletter, well known product podcaster. And I know he had talked about having created a chatbot for his newsletter and podcast content, which goes back I don't know how many years. We'll just call it a bunch. And so that kind of sparked the idea. I was like, oh, man, wow, that could be especially for. Especially for some other brands who might not be the most exciting, but they were incredibly practical. Wherever, like you said, I just need the answer. I don't want to read the documents. Just give me the answer.
Nick Martin [37:58 - 38:33]: Yeah. If you have good information, I think you're better positioned than you've ever been. Like, if you have good data or good content or useful information for people, everything that's happening in AI is a tailwind for you, in my opinion. If you're a commodity, if you're in the middle, we copy what everybody else does, and it's all sort of the same. I think you're in a tougher spot, but it's a meritocracy. And in my opinion, that means the people that are working harder and doing a better job are going to have better results. And that feels to the extent there has to be change, that feels like the right way to make change.
Eric Rutherford [38:33 - 39:06]: No, and I agree. I like how you describe that. That idea of the more I say unique, but I would say just more non cookie cutter. Is that the right word? Almost like the more unique value you offer people and companies, the better positioned you are. You know, it's. It's. Yeah, because once you get in the middle or you start becoming a commodity, it's a race to zero. And then it's. Then it's all about supply chain and, you know, everything else, because you just can't win.
Nick Martin [39:06 - 41:50]: One of the things that we see that's become really valuable to our customers, that I think will apply across all industries, is just the insights of what people want to have a conversation about. So here's what it looks like for us. Publisher launches their AI, they distribute it across their website, maybe they integrate it on social, maybe they have a text messaging version of it, and we help them. See, here are the top questions people have. Here's how you're answering them. Here's what your AI was asking them about. Here's what they're saying. Here's the sentiment analysis across these particular categories of content or pieces of info. Oh, your audience, like, absolutely loves Lionel Messi and really doesn't like Cristiano Ronaldo. And we know that not because they voted Messi versus Ronaldo, but because when we ask them in the middle of a conversation, they use the f word, and they had three angry emojis about Ronaldo. People really share how they feel when they're in a private conversation with you. And so we can do a bunch of sentiment analysis, package it up, and give the editorial teams that are publishers these editorial insights around what's happening. One of the things that can occur is we can go, oh, wow. 9% of people were all trying to learn more about this one particular part of this evolving news story, and you didn't have any coverage on it. The AI couldn't help them because you haven't produced the content. And our AI won't just go scan the web. We only use the content from the publisher. That can become an opportunity to be like, hey, there's a blind spot in your coverage. You have a lot of people who would really love to learn more about this particular part of this incident you're covering or this evolving trend, whatever it might be. I believe that applies really well into the b two b context that you brought up, where somebody might be asking the AI like, okay, but if I buy your CRM and I integrate it with this, how am I going to get my reporting? Because my reporting is over there. And it could be like, sorry, I can't help you. And that could be a great insight for that company to build, like, help desk tutorial content on how to integrate your reporting after you've done this specific integration, so that it's in the existing dashboard that you already have. Right. There's a lot of times where, like, a software company has a solution for something, but they think it's a fringe case or an edge case. They did it for this one enterprise account to win a deal, and they assume the SMBs don't want it. But when you actually get one to one, explicit feedback from the people that care about your product and what you're doing, you just see things that you wouldn't otherwise see. It's why the best advice to founders is go talk to your customers. Talking to customers is the best way to know what to build and when to build it and how to build it. And now you can actually do that at scale, and it's never as good as me and you talking one on one like we are here today, but, boy, is it a close approximation, and it's at scale, so it's quite valuable.
Eric Rutherford [41:53 - 42:27]: Preston, that sentiment analysis understanding. That's intriguing because usually we think of trying to get information from people, from customers, we think of surveys and surveys. People just think surveys, I don't know, laborious. They're just a pain. Whereas if you're getting, if you're able to gather insights from just the normal conversation, it seems then like that you're going to get better insights, you're going.
Nick Martin [42:27 - 44:02]: To get more insights and you're going to get better insights. There's something to be said just about who fills out a survey to begin with. It almost feels like it creates some amount of sample bias because it's not a natural reoccurring behavior. And one of the benefits if you have this really wide, deep conversational experience that cuts across all of your content and everything you do is that naturally, without having to force it, opportunities present themselves through those conversations. To effectively survey, you can have your AI ask 10% of people that have sent more than six messages to you in a conversation. Hey, what do you think about this one particular thing? You can do this dynamic real time polling and surveying in a way that's much more natural to the end user because they didn't show up to complete a survey. They started engaging with you because they wanted to have a question answered. They wanted to share their opinion to begin with. They wanted to better understand something that they're trying to learn about whatever it is. And as they're having the conversation, you have the chance to pull that in and it's just more seamless. Your friends survey you all the time. You don't know you're being surveyed, they don't know they're surveying you. But what is a survey besides asking a collection of people the same question and then obviously measuring the insights around that? Yeah, it's a great way to do that. There's a handful of these kinds of use cases that's like every business does. They've been done in a really legacy way and they're all kind of going to get tucked in and integrated into this conversational experience as it continues to scale. And survey is a great example. One.
Eric Rutherford [44:03 - 44:35]: So I also need to ask about text sms because I think you mentioned that earlier. Is that something that companies are leveraging a lot? Is it something they're experimenting with? Because I think so much of where it seems like where the conversation is is, you know, online social, but like text seems like it could be a big space for growth. I'd love. What? What? I'd love to hear your perspective.
Nick Martin [44:36 - 48:06]: So about 10% just under of time on mobile is spent in messaging apps today. So thats imessage in WhatsApp, messenger, viber, telegrams, a handful of them. Thats a pretty meaningful amount of time right like we spend a lot of time on our phones hours a day. 10% of that spent messaging its the biggest communication channel in the world. Theres 5.2 billion people that have access to text messaging. Theres only like 4.6 that have Internet connectivity because theres telecoms and you can tap into to just send text back and forth. At one point I don't know if this would hold. Zuckerberg's on the record. It's like 2015. He has a quote saying messaging is one of the few things people do more than social network. So it is a massive massive massive channel. It is a massive audience. There's absolutely opportunity there. Some of the things that we see happening one richer forms of messaging we're all familiar with SMS and if you're not familiar with SMS it's just like the default text messaging experience that comes on every phone. It is what you use when your imessage bubble turns green. That is the phone is tapping into SMS to send a message back and forth and it's on every single device so it's really powerful that way. Whenever you get a text from a business today that's like 65467 hey your prescription's on the way or your package is on the way or call me back if you need more support, whatever it might be. Thats SMS. Thats already actually quite a meaningful channel. I think most e commerce companies have really started to use it for remarketing. I added something to my cart I left, I didnt check out. They sent me a text because I got my phone number right before I did that and said hey eric you left this thing in your cart you want to check out. Youll get 10% off if you buy right now. They use it as a really effective way to get that low hanging fruit and convert it and theres a handful of other use cases. Messaging is going to get richer. So WhatsApp is a little bit of a richer experience than what you have in imessage. There are others Viber telegram that are quite rich. The default messaging on iOS and Android is actually being upgraded from SMS to something called RCS. This is an industry standard. It's not owned by any one company. It's like email or like SMS. It's a protocol that is a more advanced messaging technology. So you can send pictures and videos and carousels and you can have tappable buttons. You don't have to type every single thing out. It's a better experience. It basically combines the functionality of apps with the ubiquity of messaging. And when you get a text from CV's or Walgreens or ESPN or the New York Times, instead of it coming from 123456 where you're like, is this them? Is this spam? It'll come from ESPN with a verified check mark and so you'll know you're talking to the brand. That, along with things like Apple Business chat and a few others, are probably, in our opinion, what's going to unlock a very different level of engagement and scale in terms of audience consumption within messaging channels. Because you can trust it more. The experience is richer and text messaging otherwise is a little bit limited. With that being said, it has so much scale that it is a really meaningful channel already today, but it's going to get a whole lot better and get a whole lot more interesting. And I think Instagram again actually ends up being like the really good example here because teenagers spend more time dming than they do in the newsfeed. So social apps are becoming messaging apps. Messaging apps are starting to look like social apps. If you see what WhatsApp is doing with the way they're integrating channels and stories and such, it's all kind of converging. And I think that'll happen within text messaging as well.
Eric Rutherford [48:07 - 48:17]: That's fascinating. That's fascinating and that's a good perspective to understand. So just as we're wrapping up any takeaways you want to leave the audience with.
Nick Martin [48:19 - 49:44]: I think the one thing I would just call out is like, if you're somebody who's interested in the space at all, AI in general, not necessarily even conversational AI, you're probably ahead of the game. It feels when you're in it like it's the biggest thing in the world. It's the buzziest thing of all time. But most people probably aren't spending meaningful time every day using the tools and trying to understand how they can be better. And it is a tool. And so I definitely would make the recommendation to just be on the front foot, play offense, figure out how you can use even just chat GPT to make your life better. There was a period of time that lasted a while where everybody hired a 22 year old college kid to be their head of social media because they're like, oh, young kids know social. I don't think it's crazy to assume we're going to have heads of AI or AI marketing managers or some AI enabled role where if you were just someone who used the stuff for the last two years, you're two years ahead of everybody else. I think that's what's really fun about these new waves. And you have such a unique opportunity, no matter if you're a founder, if you're an executive, if you're a younger employee, if you're just somebody in regular day to day life, to really put yourself in an advantageous position by being an early practitioner, someone who uses these things. So that's probably the only thing that I'd call out. Unless you're a publisher, if you're a media company, if you're looking to grow your audience and deepen engagement and drive revenue, takeaway would be, hopefully, give me a call. But besides those guys, that's what I got for you.
Eric Rutherford [49:44 - 49:51]: I love it. So, Nick, if people want to know you, they want to know more about direqt. Where would you want them to go?
Nick Martin [49:51 - 50:12]: You can go to direqt AI. So direqt is d I r e q t a. I couldn't afford the c. It was owned by some bank overseas. Quite expensive. And you can find us on social. I'm on LinkedIn a lot, so just Nick Martin on LinkedIn. There's probably a bunch of Nick Martins. So the one that says co founder, direqt, those are. Those are the best spots. And you can reach me at email Nick at direqt if you need anything or have any questions.
Eric Rutherford [50:13 - 50:31]: Awesome. So, everybody, we're going to drop all those links in the show notes. Make sure to check out direqt. Definitely connect with Nick on LinkedIn. Nick, this has been a ball. I've learned a ton and I am so much man now. I'm excited about learning more. So this was just a wonderful conversation. Thanks for joining me.
Nick Martin [50:31 - 50:32]: Thanks for having me. I appreciate your time.