Camille Morhardt 00:23
Hi. Welcome to InTechnology podcast. I’m your host, Camille Morhardt, and today we’re going to have a conversation all about digital marketing and how AI and automation affect it; how it’s evolving, and how it’s exploding. And we have a very interesting guest in today’s Intel Capital portfolio: Movable Ink.
My co-host today is John Gildea. He’s an investment director at Intel Capital, overseeing equity investments in its cloud, devices, and frontier domains. Board Director or Observer at Airy3D, AustinGIS, Certisign, Goldbelly, Occipital, Qnovo, and Two Bit Circus and, of course, Movable Ink. He joined Intel in 2001 and worked in various corporate finance and Treasury roles before joining Intel Capital. John is a US Navy combat veteran, and I might mention that today we are recording on Veterans Day. So, thank you for your service, John.
John Gildea 01:19
Thank you very much. Camille, it’s a pleasure to be here. It’s an honor and pleasure for me to introduce Vivek Sharma to your podcast. Vivek is a visionary co-founder and CEO at Movable Ink. Movable has a unique platform that enables omni-channel digital marketers to personalize every touch point, every customer engagement through automation and AI. Vivek has enjoyed leading the company through rapid growth. It’s currently leading market position with over 550 employees that are serving the world’s most influential and innovative brands. So, with that, Vivek.
Vivek Sharma 01:58
Great to be here, John. Great to be here, Camille.
Camille Morhardt 02:00
So Vivek, the platforms you’ve created at Movable Ink are part of an evolution in digital marketing. For listeners who aren’t as familiar with this topic, would you first talk a bit about what digital marketing looked like prior to this point? And then talk about what’s changed with the advent of AI tools like yours?
Vivek Sharma 02:19
Definitely. So Movable Ink was created as a reaction in a world where, in the 90s, everyone doing marketing got their start with database marketing; simply getting your customer file online and being able to digitally access it was a very useful thing. In the 2000s digital marketing really started to take off, and usually these were channel specific platforms. So, the big email service providers was a platform. There was a channel, email being the primary channel. Eventually mobile became an important channel, mobile push notifications and so Cheetah Mail, exact target responses and Epsilon were examples of companies that were helping get emails delivered from major airlines, from retailers, from your bank, from your credit card company, etc. And in the 2010s you saw the rise of data platforms. And so, it became very important to have a 360 view of your customer, and having a CDP customer data platform or a data warehouse and all of your APIs exposed.
But we believe we’re about to enter a new era, and part of the challenges we’ve got these legacy marketing practices today. So, Camille, John, if you’re if you get an email today in your inbox, there’s a good chance it was planned four to six months ago. And there’s a very complex production process that has to happen for people to select what is the right promotion or offer that’s going to go out to you that day. What segment do you belong in? Last minute, changes need to get made. Segments get recut. And, it’s a very arduous process, and every marketer who came to into this industry. Was hoping they’re going to work on creative ideas and strategy, and instead, they find themselves feeding this assembly line and making it work properly.
And so, what you end up having is marketers who are frustrated. All of your time is going and just feeding the machine. Their customers are starting to disengage, and they’re seeing the impact of top line revenue kind of slowing down, their margins being compressed and your customers starting to just expect a coupon in the inbox. So, we think we’re about to enter this era where it’s this age of AI; the 2020 are really going to be about intelligent systems that start to know each and every customer and what they care about and serve them the content the offer in the right time, in the frequency that’s appropriate to them, in the channel of their choosing. And this is a big transition that’s taking place right now.
Camille Morhardt 04:30
Can you talk about some of the mechanics of it? So, like pulling in real time data being predictive about what a customer might want, as opposed to just looking at the history and feeding them more of the same. How’s your platform enabling companies to incorporate this kind of data? And what other kinds of data have I not thought of that you’re able to pull in?
Vivek Sharma 04:51
Sure. So, other companies may focus on some different things, but Movable Ink prides ourself on focusing on first- and zero-party data. The definition really being that first-party data, I give the common analogy, if you were to walk up Times Square and walk into a retailer, and a personal shopper is looking at what departments you might be preferring, that’s considered first party data. You’re in their venue, you’re on their website, you’re in a place where you would expect that merchant or that brand to have an understanding of what your preferences are and be able to tailor the experience to you; but you’d be pretty creeped out if you walk down the street and that merchant is following you down to other stores and writing down everything that you’re doing–which is kind of an example of third party data. So, we tend to focus on first-party data, zero-party data, which is one of the more explicit things a customer is telling you. So, there’s a whole host of that.
There are systems called Customer Data Platforms that have emerged in the last, I’d say, decade, that have been focused on customer information kind of different from business type of information, like the history of offers that you have, what promotions can you run, and to have a centralized access to it and as fast as real time as you can be about a recent customer interaction that’s happened. If someone’s purchased from something from you on your website, and you’re catching that a week late later, or they’ve abandoned a purchase, it may be too late to act upon that.
So, you’ve got these CDPs, you’ve got data warehouses like Snowflake and Databricks that have risen in prominence over the last decade. You also have APIs that companies have built that are for internal use, and if you could tap into those in real-time, there’s another whole dataset available to you to personalize the marketing experience. And finally, whether we like it or not, lots of marketing departments still pass around information in CSV files. So, Excel is still the lingua franca of the marketing department, despite all these major technological tools and data platforms that have emerged.
Camille Morhardt 06:43
And you’re also pulling in real-time data like weather, external data that could be relevant to– I’m just picking weather, but something events happening in the world.
Vivek Sharma 06:52
We call the contextual factors. So, these are things you wouldn’t know until the moment of engagement, when a customer opens that email. So Movable Ink has the ability to detect the time of day, the weather outside, roughly where you happen to be, and these are factors that are unknowable before you send out that marketing communication. And so, in some marketing use cases, that ends up being very important if you want to sell snow jackets, versus there’s a blizzard that just happened, you want to sell snow jackets to someone, or there’s a time-based promotion or a daily deal. That’s actually when we started the company—”daily deal” and flash sale sites were very in vogue–and the time sensitive nature of the promotions, it was important to be able to pull items off and put new items on inside that email after it’s already been sent out. So, these are things Movable Ink really started out focusing on those contextual factors.
We didn’t know a whole lot about what data marketers had or didn’t have access to, and we were able to provide this very novel data source. And there’s still a lot of personalization that happens around this. However, over time, we found that the vast data stores that big companies like an American Express or Bloomingdale’s have on their customer file end up being far more important than some of those contextual factors, and those are the things that come into play as they are personalizing those marketing communications.
Camille Morhardt 08:14
Think you mentioned a couple of customers. Could you let us know some of the industries and customers that you are already working with?
Vivek Sharma 08:21
Sure, we work with a huge, broad set of industries and customers. So for example, in retail, Victoria’s Secret, with Walmart, with Bloomingdale’s. In travel and hospitality, we’ve got pretty much every airline in the US, except for one. We’ve got hotel chains like Hilton that use us and Expedia as a travel aggregator; in financial services, American Express, Citi, Morgan Stanley Wealth Management are all customers of ours. Media, entertainment publishing companies like ESPN or NBA in sports use us. And technology companies. We do work with many divisions of Amazon, we work with Meta, we work with Google. So, it’s really a broad cross section of companies, and the common thread is, with all these companies, they have a huge audience on the other side of a marketing communication. Meta might seem funny, but they actually have millions of small business owners that are using Meta to market through and use Meta’s tools. So, it behaves a bit like a B2C type of company in that regard. But it’s a huge cross section. And if you have a big audience and you have data, and you want to be able to personalize the experience, Movable Ink is the best tool on the on in the market to be able to achieve that.
Camille Morhardt 09:32
And when you were first talking about this, you know, in maybe in 2010 when you founded the company, email marketing was kind of a big deal. And I think, the world has moved on. Certainly, email marketing still happens, but there’s lots of other channels right now. So how are you helping, you know, triangulate, or come into people’s mindshare other directions besides email?
Vivek Sharma 09:57
Yeah, funny enough, in the mid 2000s I started a mobile company. The company didn’t work out because we were a little too early. And so, I wanted to do something in email, primarily because it was a ubiquitous channel. Everyone gets an email address, it’s their identity, it’s their digital wallet. It knows so much about you. It is a great marketing channel for communication, because you can reach anyone in a pretty easy way that you have not built the loyalty yet or they’re not going to download your app, which is a more down funnel kind of behavior; but you’ve got a huge audience, and there’s a lot of protections for the consumer in the email inbox. The big inbox providers like Gmail and Apple have spam protection, and they’re looking out for phishing, and deliverability is an important thing. So, there are protections against people getting to your inbox that didn’t get that consent. So, it’s an unbelievably good channel. And despite perception that email be may be fading, it is still the highest revenue driving, outbound channel for marketers, and it eclipses mobile and SMS and channels like that.
But the good news about email is that the learnings from that and when you start to go omni-channel as movable ink has done now, we support mobile push. We support mobile in-app. We support SMS. WhatsApp is coming in the first half of next year. When I went to Europe just a few weeks back for our London Think Summit, nobody uses SMS there for marketing, but everyone’s on WhatsApp. And when I was in Japan, everyone uses a messaging app called Line. So, the channel doesn’t really matter. Web is also something we’re going to be supporting. The idea is that people are engaging with content of some sort. They expect it to be personalized for them, and whether their preference is signing up for an email list or downloading an app and seeing marketing that is personalized in there, or it’s SMS marketing or a messaging app, Movable Ink is there with a common approach, helping marketers personalize that messaging to you wherever you go. And into the future, new channels will emerge that we will also support.
Camille Morhardt 11:56
So you have two platforms, Studio and DaVinci. Can you quickly run us through? You know what those do and actually what’s happening? You know, if somebody were to sign up with Movable Ink, how are they using those?
Vivek Sharma 12:07
Yeah. So ,Studio is able to take any data set within a company, activate it, and generate content from that in the moment of engagement inside a marketing communication. So, for example, American Express is a company that spent over $100 million in systems that manage data and how they get to know their customers. However, they’re not achieving their marketing objectives because that data, it might be useful for determining in a segment or who to message, but if you’re just putting generic content in front of them, it’s really like having a very shiny envelope but a very generic nothing to say in the message that comes inside of it. I’ve got my Amex platinum, and I use it all the time. I’m racking up the points on it. Just used it for booking flights for the holidays. But there may be many components of that email. Some are dealing with contextual factors, and based on the weather outside, it might be pointing you certain Resi restaurants. Resi’s an Amex company now to make restaurant reservations; they might be calling their internal loyalty system and realizing you might be ready to reach gold status with them. And how many points do you need to spend to achieve the next level of benefits. There may be, other data about you and your recent behaviors and your preferences that they’re able to tailor the experience for you.
They brought on Studio, and it’s able to wire up these different data sources, generate a dynamic piece of creative apply their business logic that mixes and matches between this and is generating a completely unique image for each and every customer on every send. It’s an evergreen piece of content they don’t have to think about again. And it’s essentially running an automated email marketing program for Amex, and they’re seeing enormous results and greater usage of points, greater redemption of offers that they have.
Now on the flipside, DaVinci is our newer product. We acquired a company called Coherent Path just about two and a half years ago, and Coherent Path, now that we’ve rebranded that as DaVinci. I kind of like to think of it as Lego blocks inside your email. You build a piece of dynamic creative you put it inside your email sending platform, and off it goes, and then does its magic when the email gets opened. Davinci has a very broad remit. It is looking at your marketing program and all of the gut feeling and intuition that used to happen in your marketing program, about merchandising teams arguing around a table about what offer should go out, who should get what? What should the send time be? Let’s have a fixed calendar, and let’s set these dates, and let’s decide to go. It’s very marketer focused. It’s very inward focus on what the marketer wants to talk about. But DaVinci excels at listening to each and every customer that you have understands what they’ve done before. But it doesn’t just reinforce that, it puts each customer on a path of discovery. So rather than one campaign, one size fits all, it’s able to produce an entire campaign that is tailored for each and every customer. And it’s telling you, Camille, a very unique story, compared to John, who’s seeing a very different story. And each of you will get a different send time for your message. Each of you will have a different frequency associated with you. Camille, you might be very passionate about getting your Amex offers, and John wants to receive it less frequently, and the algorithms, the machine learning, is able to detect that and adapt the frequency, on the fly.
We’re generating copy to speak to you in the language that you like to be spoken to. Some prefer a language of urgency. Others would react better to fun and joy, and so being able to associate creative with multiple ways of talking about it, the send time, the frequency, the channel preference, what story to tell each customer, Da Vinci is automating all of this, and it’s able to still deploy that email or mobile communication or what channel within the platform, within your existing marketing platform. So, both products have done really well in letting you keep your existing Martech stack, but enhancing the value through either the use of intelligence or automation or both.
Camille Morhardt 16:03
And is it building that intelligence based on people’s responses? So, like you say urgency versus joy: is it just learning what I’m most likely to respond to? Is it testing a bunch of different things? Is it grabbing information from somewhere else to make an assessment about that?
Vivek Sharma 16:18
Yeah, so all of the data sets I talked about earlier, these can be brought to bear, and these can be inputs into our models. And so, Movable Ink is unique in that our AI takes what we call an “ensemble” approach. This is a technical term in data science and AI circles, but “ensemble” means there’s different types of models that are brought together to solve this business purpose; we have a vision model that uses deep learning, and it’s able to evaluate all of your imagery, understand what it’s about, label it with metadata. If you’ve got a new piece of creative that you’ve never used before, we can actually give you a pretty good sense of how it’s going to perform, and start to–without a cold start–start to put it in front of the right kinds of people who are likely to resonate with that.
There’s a Generation model that, just like everyone else, we’re all excited about Generative AI, as well. But the Generative model is able to do data mappings in a very flexible way. It’s also able to generate copy in unique languages. And we feed it your brand guidelines, and it speaks in the voice of that particular brand. It’s been kind of tuned and trained for that. There’s a Prediction model, and this is more classic machine learning, which actually allows it to be a little bit more observable, explainable, than a black box model that is harder to kind of interpret. And this excels at putting you on the path of discovery. Where are you going next? What’s the next story to tell you? What’s the next send time? What’s the next best action for this individual?
And lastly, an Insights model that is helping to demystify what’s happening with all of these models. And executives love this. We provide reports that they’ve never had this feedback loop about how their marketing’s going and their creative teams, who’ve operated blindly in the past, that are building things based upon rough, creative guidance. Now, they’ve got a feedback loop about what’s really effective, and what should they produce more of, and what should they stop spending their time producing as much of?
But the best news is that the creative–the hard work they’ve done on building a new image, building a new design–it isn’t wasted; it lives on forever for the full season that it’s eligible and it shows up for the niche audience. It might be a really passionate niche audience that reacts well to that, and you don’t have to get rid of it, but it won’t be in the cycle for your mass audience, but for that niche, it’ll show up very prominently. So every piece of creative will be used to its maximal impact, and there’s this beautiful feedback loop that happens for the marketing teams about exactly what’s happening with each and every customer.
Camille Morhardt 18:39
So, two questions, one is, are we to the point yet where an engine like this could generate an incentive or a coupon or a discount or something on the fly based on new what somebody’s searching right then, more than just, you know, the pop up, oh, you get 10% off if you sign up right now. But something a little bit more, “oh, I’ve noticed you’ve been searching this well, if you buy that thing, plus this thing,” or whatever, you know, some kind of generative, customized, you know, incentive. And then the second question is, can any of this tie back to the supply chain at this point, where you’re actually building product, almost real time, or just in time?
Vivek Sharma 19:19
Both very interesting questions. On the first one, I will say there are companies that have pricing engines. I think the airlines are probably the most optimized with this type of thing. Financial service firms, too, about what particular kind of offer to give you, but the kind of destination that might be appealing to you is something that our algorithms are able to tease out. So, what we find is our customers have a promotional strategy. They’re going to be running the Black Friday sale and the cyber you know, the Cyber Monday promotions and everything like that. But separate from that, what’s happened is some companies have over relied on promotions and discounting as a strategy, and in the long run, that is brand eroding. It’s also margin compressing. You know, if you’re always going to do 50% off, you’ve trained your customers that you’re a coupon company and to just wait around for that.
And so, what our customers have been able to do is to be selective about when they’re running promotions, and in the rest of the time they can be far more editorial and personalized. And you’re showing people the things that they want to see and where they want to go without having to lead with a big discount as the pitch to that individual customer. So that’s an interesting transition we’re seeing happening, and that just builds healthier companies for the long term that are preserving their margins, but it’s also building happier customers.
Every single customer we have we do a holdout. They do their business as usual campaign that they’re going to run, we build a proxy control that is a synthetic proxy, so at some point they don’t have to go run that BAU anymore, and we do the AI based personalization. Movable Ink DaVinci doesn’t win deals if we don’t beat their numbers on revenue, on conversions, and the average customer we have sees an improvement of over 20% in lifts in revenue and conversion, but beyond that, we’re building happier subscribers. People aren’t unsubscribing. There are dormant subscribers that are waking up in a list. Victoria’s Secret just had this great experience with us, where they brought us on early last year, and their brand has gone through a lot of transition in the last few years, where there’s a more diverse customer base that they have; but they had a big dormant email file where a huge number of people weren’t engaging with their content. They brought in DaVinci to help figure out where people are going on their buyer’s journey, and this started to personalize within just a few weeks. The senior team got wind of this, saw the great results, got excited about it, saw that they were waking up the dormant subscribers, and they’ve been a wonderful customer for us since that point. This is kind of the example of how testing and measurement and leaving away the reliance on discounting works.
To your second question I think you were asking about, does this feed back into the supply chain? and how does this help people? Today it is not a fully automated process. We’ve certainly seen management teams at these companies look at this data and get a deeper understanding of behaviors of sub segments of their audience, and which starts to point to some trends of like certain products, or we’ve got a niche here which we never really understood, or there’s a spend ban that people were comfortable with, but when they started to see the algorithms serve them in this way, we get people to buy like a more premium shopper for us. So, there’s fascinating movement of the rivers of customer information, customer behavior that are starting to become unearthed, and this certainly helps impact the marketing program. But this absolutely is feedback we know buyers and merchandisers these companies are also taking this great input and starting to think more deeply about how do they build a supply chain that meets the demand and the interesting nuances they’re seeing in their engagement data.
Camille Morhardt 22:49
Really fascinating stuff. Vivek. John, what is your take on the future for this?
John Gildea 22:54
Well, it’s pretty interesting time. I mean this intersection of AI in Martech in general. And it’s interesting to see that clearly personalization at scale, SEO optimization, these are all clear winners. And a company like Movable Ink certainly has a differentiated advantage in this space. I guess I’m going to turn the tables and ask a question to the back. I mean, working with a lot of these major brands logos, knowing that there’s limited share of wallet for marketing expense for digital marketers, looking at the environment, I’m assuming there’s some consolidation in Martech, in general. But I mean, what is it that there’s they’re afraid of when they look at AI and what they’re traditionally used to doing in creating copy, right and releasing some of that control and brand management to automation. What are some of the risks or fears that you see from your logos when it comes to AI in automation?
Vivek Sharma 23:53
Yeah, it’s funny. Two years ago, I was chatting with our CMO, asking her, “how do we elevate marketers’ attention to AI as a key part of being in the marketer’s toolkit?” And some marketers were playing around with it. It was on the edges, but it was nothing in a major way. Yet, even though we just acquired Coherent Path to launch DaVinci. Luckily for us, a little company called Open AI launched a product called ChatGPT with the ugliest name ever and no marketing, which turned out to completely revolutionize and call attention to this great breakthrough in LLMs in the AI space. So suddenly we went from a very niche minority speaking about AI to everyone saying “we’ve got to do something about AI. We’ve got to get in on this,” but not being really clear about what that “it” is.
And so, what we noticed was a ton of interest early on. You know, “we want to understand the AI solution. We want to understand how this works,” to some pullback and caution about, “well, what does the information security look like? Is there data leakage?” We have a trust layer in our software, so privacy, safety and security are the three founding principles of this trust layer, where Privacy means we’re safeguarding your company’s data, it doesn’t become leaked into a public model. Security means we’ve got ISO 27001 certification, the highest standard standards for how we manage your first party data. And Safety being that your models are only being trained on your information. We’re not co-mingling and training other people with your learnings. We’re not other companies aren’t benefiting from that.
So, answering these questions, we are also offering an AI native workflow. So many companies, software companies, have rushed in and thrown GPT into their product and say, “we’re now an AI company” overnight. And what we’re sometimes chuckling about is, we’ve been doing this for years, and enterprise marketers, we understand the things that work and the objections or the safeguards that come up in that workflow that companies are only going to start to learn about in the next six months to 18 months. For example, we have companies that want to override the algorithmic result in certain cases where they say, “Hey, I want to run my promotion,” or “I need to clear this excess inventory.” And the AI is not going to know about that. They’ve got rules around prohibited creative pairings. You know, “this Gucci bag can’t sit next to this, this Chanel offer that I have. These things shouldn’t go together.” They want to be able to prove a million different variations of different content that could go to different people, because the machine’s making all these selections. And how do you build trust that that is doing something that is not only going to drive greater financial results, but doesn’t tarnish your brand?
So, these are all deeper questions that have to be confronted. And if you’re new to the space, you’re probably gonna have a big wakeup call when you realize that these are very important things you have to get right for enterprises, and there’s very little room for error, and it’s stuff we’ve really spent our time years focusing on.
Camille Morhardt 26:47
Well, Vivek Sharma, founder of Movable Ink, and John Gildea, Intel Capital Investment Director. Thank you so much for joining today. I learned a ton, and I found it fascinating, and I’m looking forward to more engaging, personalized offers that will benefit me.
Vivek Sharma 27:05
It’s great to meet you, Camille, great to see you again, John and happy Veterans Day. Thank you again for your service.
John Gildea 27:10
Thank you very much. And Camille, it was a pleasure. Thank you so much.
