Marketing Adjacent

Episode 2 Rapid Fire
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[00:00:00]

[00:00:00] Mike Grinbeg: I like that.

[00:00:06] Garrio Harrisson: I'm stealing that.

[00:00:06] Mike Grinbeg: Creator. Enabler. Creator enable. Hey, Pete, starting today. Trademark.

I think that is the way that you diversify risk. Mm. Because you,

[00:00:28] Garrio Harrisson: and how do I do it in a way that honors

[00:00:32] Mike Grinbeg: the,

[00:00:34] Garrio Harrisson: the investments of blood, sweat, and tears.

[00:00:40] Mike Grinbeg: Are we considered geriatric millennials? Is that what we, you know what?

[00:00:47] Garrio Harrisson: Legacy building.

[00:00:48] Mike Grinbeg: Garrio, what's up? [00:01:00] So I, I think we gonna, I think I need to cut down that intro to maybe like a quarter of that length. I'm even getting tired of listening to it.

I'm gonna spare everybody else moving forward. I think I'll have to recut that. All right, well, we got a episode two jampacked jampacked episode of Marketing Adjacent. Uh, it is April 20th, which is important to note recording on April 20th. By the time this goes live, we'll be about a week later or so, so we'll see if it's all still relevant at that point.

A lot of things to talk about. We're talking about AI and copyright. We're talking about the speed of innovation in AI and how new business models and revenue models are gonna need to be created for people to adapt. We're gonna talk about identity as a core layer, uh, of how maybe some of the problems and issues we're seeing right now get resolved.

Um, We're gonna talk about rebrands. There's been a lot of [00:02:00] them recently. Mm-hmm. Some good, some bad. We'll talk about those. And are they helpful? Uh, and something you and I both have been noticing we're gonna talk about is vertically integrated service models, especially for like agencies and consultancies.

Um, like an interesting topic to talk about. So with that, let's jump into the right now.

All right, I'll cue this up. I'll cue this. Topic number one, AI and copyright. So you sent me this thing, Garrio, and I think everybody's probably seen it, um, at this point. Um, the Drake and the Weekend track. Mm-hmm. I'm gonna pull this up real quick here.

Right. So if you haven't seen it, haven't heard it. [00:03:00] Somebody I can't remember who created this, sounds like them. And people are going wild about it when viral. Mm-hmm. Right. Um, there a number of things for me that come to mind. You know, obviously the, the question here is, well, this is clearly breaking copyright law, obviously that's what there, there's, I know there's also like a, a big one.

Um, there was a Jay-Z track. There was also supposedly an m and m track too. Uh mm-hmm. They all seem to be happening kind on this hip hop and r and b genre for the most part. And I, I wonder, wonder why that is, but that's a whole separate conversation. Maybe. Um,

stripping the, the legal stuff aside. I kind of keep coming back to. What's the value? Like what are the, what is the actual value in these things? What are the different use cases? So, [00:04:00] um, on the one hand, uh, it's okay if I'm an artist, do, do these tools allow me to churn out more volume of tracks of music, right?

I can bypass the production layer to a certain extent. I mean, I can, I can bypass, I'm gonna go in a studio potentially by creating, you know, training models and on my voice and maybe instrumentals and all this kind of stuff, and I can just turn out more volume. Is that a good thing or a bad thing? And should that be regulated?

Or do you let the market decide? Do you let the consumer decide with their wallets, if you will? How much of Drake's music do they really wanna listen to? Mm-hmm. Um, You know, on, on the flip side, obviously it's, well, it's the knockoffs that's clearly a bad thing in my mind. I don't think it [00:05:00] should be, I don't think some random person off the street should be allowed to create a, an AI model of Drake's voice.

If the weekend's voice of Adele's voice doesn't matter whose voice. Yeah, I agree with you. And just be able to profit off of that. Now the question is how do you regulate against it? And, you know, one idea you and I discussed prior to jumping on here is identity being one thing. And we'll jump into that topic separately.

Mm-hmm. Um, the other thing that I think is valuable to think about is what about the non-famous people? Hmm. Right? Where the voiceover artists. Mm-hmm. Um, and not like the famous ones. We're not, we're not talking about, you know, Eddie Murphy being. No. Was was Eddie Murphy? Was it, uh, Chris Rock? That was the donkey in Shrek.

I don't remember. Uh, I think it was Eddie Murphy. Eddie Murphy. Yeah. Yeah, yeah. Like we're not, I'm not talking about that. I'm talking about Eddie Murphy. I'm talking about the unknown person [00:06:00] who's doing a voiceover of like an audio book or something. Right. Right. Um, now you've got companies building AI models off of their voice models, off of their voice and mm-hmm.

Not paying them. Right. That to me is a bad thing. So what do we do about that? How does it get regulated? What's a different business model that should be created? That kind of thing. Um,

Sam, what, what do you think Garrio?

[00:06:30] Garrio Harrisson: Well, I like, I like the, the framing that, that, that you gave it here. Um, cause I think there, there, there are pros and there are cons, and I think the discussion that's being had right now is kind of trying to have the same conversation. All at once. And I think that that becomes, um, unproductive.

Right? Um, you know, earlier, earlier in our, our convo, we were chatting a little bit about just, you [00:07:00] know, when has there been a time in history when new technology forces an industry to rethink their entire business model from the ground up? Um, and we landed on, um, Napster, right? The Napster moment. Right.

And, you know, the, the Steve Jobs famously going in and saying like, look, you can sell an entire album. And the whole unit economics, that was just literally printing money from distribution deals to 360 deals with artists. Um, the, the music industry as a whole were making a lot of money before Napster came out.

And they literally went down to zero, right? Because music was free pirating. So then the question then became, okay, well do you want a hundred percent of nothing? Or cuz you were making 2 99 per track before whatever it was. Um, and at [00:08:00] that point you're just promoting to get as much, uh, exposure as possible.

Or are you comfortable with 99 cents and retooling your business model to adjust for, um, this new change? Which meant things like, now you're investing in an artist's entire career. You're investing in artists y beyond their one hit album. You're, um, you know, changing the way you compensate artists, you know, with streaming them different cuts.

Like, so the model itself ended up evolving based on, based on this. So I think these. You know, if you think about is it possible to find a solution, I would argue yes. Um, because there, the podcast that I, that I, that I was mentioning on the blog era, uh, earlier the, they were talking about just [00:09:00] the whole what was happening behind the scenes.

I mean, you, you and I were in, were in college at the time, right? Like we, as far as we were concerned, it was Limewire and Napster. That was, that was our understanding of the experience. And, and then BitTorrent. Yep. And then BitTorrent. And there was so much stuff going on behind the scenes, just legally business models like screaming matches in boardrooms, like, you know, tussling around like long-term contracts.

Um, educating people on the fact that, you know, what does it mean to have a thousand songs in your pocket, right? Like there's a whole ecosystem happening behind just. Our experience of it. And I think that's what's what's ha what's happening now. Um, so yeah, I, I, I'm with you. I think, I think the business models need to evolve, but in the meantime, man, it is, it's gonna be real messy,

[00:09:54] Mike Grinbeg: let's put it that way.

Yeah. And I think, I mean, what the interesting thing to me is maybe to round out the, the topic of a [00:10:00] versus copyright, and we can jump into the next topic here, is I think it's easy to make the argument and to say, well, yeah, this is definitely going against copyright law like this, the Drake and the weekend thing that we just talked about, for example, or any of the other things that are happening now.

Like that, the question becomes how do you actually regulate this? I mean, sure, you can go after one or two, whatever, but I think, uh, if you, if we think back to na, like na, yeah, Napster got shut down, but mm-hmm. Limewire, I think maybe did at some point too, but. BitTorrent never did.

[00:10:39] Garrio Harrisson: And they tried to sue the downloaders and

[00:10:43] Mike Grinbeg: up they tried to sue Downloaders and there were a few.

Exactly. Yep. Right. But it, it never really went away. I think what, what solved at least a big part of that problem was streaming. Mm-hmm. Streaming and the extra features that came along with it, like the recommendation engines and whatever. [00:11:00] It became so much easier and more valuable for somebody to go and just sign up for Spotify and Pandora and whatever else.

Then to just keep having to download things and create playlists and manually and save things and have hard drives and blah, blah, blah, all this kind of stuff. It's like, well screw it. I'll just do that. Are there people that still do that? Yeah. But it's such a small part considerably. And you created a business model that was viable.

That's solved for a lot of this. Um, so I think Yes. Does it go against copyright? Sure. Are they gonna, are they gonna be lawsuits? Yes. Is copyright law gonna be the thing that solves this? I don't think so. I don't think so either. And that gets us into our next topic, which is adapting to the speed of innovation.

Oh, yeah. Mm-hmm. And there are a lot of things that we actually, we didn't even get to talk about in our last conversation, or the pre-conversation before we [00:12:00] started recording. Mm-hmm. But, um, you know, it's like all this stuff that's happening around, where is AI being used and how is it being trained? What is it being trained on?

Right. Where there's privacy regulation and there, I mean, there's all sorts of messy stuff, right? I mean, there's this, we, we didn't get a chance to talk about it. I'm gonna, I'm gonna pull a bit of an audible here. Um, uh, you know, there's the, there's this article from, uh,

Uh, m i t tech review, right. Of, for data's coming back to Bite it. Right? Or there was this other one around, um, uh, oh shoot. There we go. Ah, it's behind a gate. But anyway, it was a, it was a article about Reddit, um, uh, wanting to now charge these mm-hmm. Like [00:13:00] open AI and whoever else to train off of their data.

Um, then there was this other thing I saw around, um, oh, where is it? Here? I have it up somewhere. Here we go. Um,

You know, Elon threatening to sue for, you know, uh, open AI illegally using Twitter data to train their models, all this kind of stuff. Obviously Elon's now starting a AI company of his own, so there's obviously some self-serving things there. But, uh, there's the privacy components. Obviously we know that the Italians and a bunch of other European EU regulators are suing open AI or at least looking to sue open ai.

Um, then there is the healthcare space with Epic, right? Um, I think I've got that somewhere. Yeah, here we go. Right? Epic. Now having apo, uh, supposedly starting a [00:14:00] partnership with Microsoft to do GPT-4 into their, uh, you know, electronic records management and, and whatnot, system. Um, what does that do to privacy?

Mm-hmm. Of healthcare data and all this kind of stuff. Right. So, regulation needs to be there. I'm not saying regulation isn't a solution. I think there are certain things that need to be regulated. The question is at what level mm-hmm. Do we reg, do we regulate? And then I really do think there's gotta be some sort of business model that gets created around, um, around the privacy component itself and the, um, identity component, which is our next topic here.

Mm-hmm. That incentivizes ethical use, because I don't think regulation's enough.

[00:14:59] Garrio Harrisson: [00:15:00] Right? Yeah. It's, it's, it's, it's funny when I, when I, um, When I shared, when you shared that the Epic article, I, I shared it with Joanna, my wife's a nurse, and her immediate reaction was exactly what she said. Like, what is this?

What, how does this affect, how does, where does HIPAA come into all of this? That was her very first question, right? Mm-hmm. And, you know, I, I look at all these, all these models being trained on, you know, third party data. And I think, I think what's happening right now is people have found a different use for the, the exhaust of people just using the stuff, right?

So, you know, advertising was the model of, of digital publications. It was unlimited. We could charge cost per million. So the goal there was to get as many people reading it as possible. So let's just make it look at Buzzfeed, [00:16:00] like let's just go viral, right? Well, The need to go viral means that you are open, which means that your rules that you put in place meant that people could use your, your, your, your information in certain ways.

You know, a good example would be like the light button, right? Like the light button was just the thing that was created for us to indicate whether or not we appreciated someone's post. And we wanted to see more posts like that. Well, we were essentially training Facebook's advertising platform to better serve us ads, right?

But at the time, nobody cared, right? Until now. So you can't put the genie back in the bottle. But what does that mean going forward, right? Because I think there's, you know, you're hearing like the EU saying, you know, uh, Facebook and so on, or these large language models should compensate. [00:17:00] Um, News publishers for accessing, for training their, their, their, their models on their data.

Well, that wasn't the model before, so I'm okay with renegotiating what that contract looks like, but to, to say now that what they're doing is wrong is disingenuous because you are fine with it when it was economically in your favor. Right? So I like, I like how Reddits approaching this of like, look, we trained on, on this and that was great.

That was our model. Now things are changing and we're gonna have to start charging you for access. Just like Facebook is starting to charge for, you know, new features and benefits for identity. Um, you know, as deep fix become more and more a thing, like we have to come up with new economic models, but mm-hmm.

Yeah. Like it's gotta be, we gotta start from the fact that. [00:18:00] Things have changed, therefore let's reimagine it from the ground up instead of this docking back and forth on, forth on, Hey, you should be making money on the thing that I gave you access to for free. There's no there, there, there's no takebacks in this, in my humble opinion,

[00:18:21] Mike Grinbeg: I no, I, I totally agree.

You can't put the genie back in the bottle and, and Right. Again, I do think that this technol, these technologies are changing the way business will is and will be done. So the question is what needs to adapt? Is it the right, is it the regulation, is it the business model? Probably both. Well, I like also, oh, go ahead.

[00:18:48] Garrio Harrisson: Oh, go, go, go back

[00:18:49] Mike Grinbeg: to like, I have nothing more valuable to add to it, so go for it.

[00:18:53] Garrio Harrisson: It's good to revisit the, the, the concept that you shared about agile. [00:19:00] Regulation. I think it, when you mentioned it before, it, it, it stuck in my head and it's now the lens that I look at a lot of this stuff through, right? Um, that's the beauty of these, of these Congos, right?

Um, and I think that, that, that might be the solution at the regulatory level and the way that you framed it as earlier in our pre-call of let's really spend the time understanding what problem we're trying to solve to make sure that it's a root cause solution while still giving the flexibility to change it, you know, to adapt based on things change, right?

Because things are moving so fast. I don't think, you know, setting another law or amending an existing law is gonna be enough because, you know, let's say you saw the section two 30 issue. They're just gonna find a way around [00:20:00] it. Right.

[00:20:01] Mike Grinbeg: Um, well, and again, as we talked about last time, the system just isn't built to move fast enough.

Right? Cause how, how many times are you gonna keep amending law every month, every two months, every, every couple weeks? What are you gonna do? So, right. Uh, um, totally agreement with you on that. All right, so we talked identity just very briefly. Here's the, uh, you sent me this, which I, I hadn't seen until you did.

I think it's fascinating for a variety of reasons, this partnership between LinkedIn and Clear for verification features. You also just mentioned Facebook releasing premium features for verification. Although I don't know the details of how they're going about it at this point. I haven't delved, deepen up into it.

Um, I think it's fascinating the timing of this, and I don't think it's a coincidence. Mm-hmm. Because again, Deep fakes and AI generated stuff and all this, all these kinds of things. I think it's so much more like identity has become [00:21:00] currency. Mm, mm-hmm. In a way. Mm-hmm. Right. And your identity is literally your ip, especially if you're any sort of creator.

And let's be honest with the way things are going, everybody is to a certain extent, some kind of creator, whether a huge one or a teeny tiny one. You need to own your own likeness and whatever. So what do you, what do you think about this? Like, uh, I mean, all sorts of stuff going in my head in terms of why now and how do you think it's gonna play out and things like that.

What, what do you think?

[00:21:33] Garrio Harrisson: Um, I think you're, I think you're, you're, you're, you're, you're spot on with this idea of we're all creators at, in some degree, right? Just like the resume, which is essentially just saying, Hey, here's what I have done, here's what I've accomplished. To this point, and here's why I can be a good asset to you.

Right? And before, you know whether you're gonna get a, a job at McDonald's and [00:22:00] you're, you know, putting on a, a a a shirt that doesn't quite fit with a tie, and you're walking in and saying, you know, I would like to work here at this Starbucks. You know, when you're getting your first job outta high school or you're writing a cover letter, um, to go get, you know, a, a grownup job, at the end of the day, all you're doing is saying like, here's who I am.

Here's what I've accomplished. Here's a story and how I'm presenting myself. And this, this should result in economic opportunity for me. Right? If you're a plumber, the way you walk up to the door, present yourself, take your shoes off. Like all, all those things start to to to matter, right? And I think this next wave of the internet, That's gonna become even more important because, you know, if you meet, if you meet someone, let's just, let's say you meet someone and, and it is not even about work.

You are, [00:23:00] is this somebody that I want to get to know better? What's the first thing you're gonna do? You're gonna Google them, right? So how they show up online is an indication of whether or not you return that text message, right? Or if you schedule that, that, that happy hour drink, or if you invite 'em to your house, right?

These are all things that we start to do. We start to create narratives about ourselves now with the, with tools like generative AI and, and, and photos and, and all this, like, now the identity who you are is at a premium, right? Because they're ne there's, they're nefarious reasons from, you know, a, uh, from a.

LinkedIn standpoint, which is why I think it's important that they did the whole clear thing and they made it free, right? Because it's like, look, if you come into my business and you say that you worked at Microsoft and you use that to get another [00:24:00] job and all that, there's a lot of stuff that can, that you can manipulate to make that happen.

So identifying who you are becomes really important. So I can understand why Microsoft did it that way. Facebook, on the other hand, I wanna know, I'm willing to invest in people knowing that this is the real me, right? Because for whatever reason, professionally or personally who I am, and being in control of my own identity becomes really, really important.

At some point it's gonna be free, right? It, it just has to be. Um, but for now, if you have, if there's value in it, you're going to, to to, to make that investment. And I think, yeah, just. With the rise of deep fakes and just the explosion of content that we're about to see, there has to be some sort of indicator that this is, this is, this is me, and therefore when I say something, it's coming from me, not some, you know, [00:25:00] a bot or an agent or someone trying to in impersonate me to, you know, further some nefarious means

and rant.

[00:25:16] Mike Grinbeg: I just realized I was on mute. The, the interesting thing to me is, you know, about a year ago everybody was thinking that, um, Blockchain and everything was kind the new thing. And there was this concept of synonymous identity. Like that's the next thing, like separating the real you from the digital you, you know, to, uh, you know, decrease, um, uh, like discrimination and all this kind of stuff.

Which, we'll, we'll, we'll set that aside now. It's almost the o it is the opposite, which is No, no, no, no. I want everybody to know what, who the real me is, and I want everything I do to be associated with the real me. But now we're talking about potentially using that same [00:26:00] technology, the blockchain to, to do that, to achieve that.

Mm-hmm. That thing. Mm-hmm. So that you can then, whatever, you know, you can have a smart contractor or whatever certificate that shows Well, this piece of content that we are recording now, this is Mike and Garrio. This other fake thing that somebody created does not have that, that stamp on it. That is not Mike and Garrio do not listen to that.

Right. Right. And then going back to kind of some previous conversations, the previous two topics we were talking about, that really could be a way to incentivize proper behavior rather than using regulations. So kind of carrot versus stick, right? Hmm. If you can make it really clear what's real, what's not that incentivizes streaming services, for example, in platforms, Facebook, YouTube, TikTok, if they don't get banned, right, uh, you know, whatever, um, to say, oh, either a, just not [00:27:00] recommend or even allow those on their platform at all.

Or if you don't wanna regulate that way, at least remove it from your recommendation engine or something. So it's like the only way you can find it is by really, really looking at that point, who's really gonna spend their time? Right. So that affects that economic model,

[00:27:19] Garrio Harrisson: right? Yeah. That's. It's interesting.

Guess. Yeah. If you're, as you're talking, I'm thinking of, you know, why would a, someone that is investing in their career, I'm thinking, you know, someone passed a, a manager, right? Director and above, you know, at some point you start to manage your executive presence, right? Mm-hmm. And that, you know, it used to be, you know, the, the events you go to, speaking opportunities, all that kind of thing.

And I think now when you're competing against someone that's [00:28:00] just churning out content about your subject matter expertise, right? And you are sharing your lived experience about a particular topic, it becomes really important for, for you to be clear. Like, this is me talking about this topic and not, um, this.

Piece of content that's written in my style or it uses my voice or whatever it is, becomes really important, um, to avoid misinformation and, you know, mixed mischaracterization and that sort of thing. And the only way that happens is if there is an identity layer that we can go back to and reference.

[00:28:39] Mike Grinbeg: Yep.

And that gets into one last thing I'll, I'll throw out in there. We'll, we'll switch gears here real quick. We talked about in the, in the pre-show, around about, um, like what is inspired by, what does inspiration look like these days mm-hmm. Versus the way it did before. And I think that's a big important part too, is, you know, in the past, artists and creators, they could say, [00:29:00] oh, I was inspired by what somebody did and I'm gonna do something like them, but in my own voice.

Now all you gotta do is type a prompt that says, you know, create a track that sounds like Drake or whatever, and off you go and mm-hmm. I mean, it's not as obviously as simple as that, but not too far off. Yeah. So, right. All right. Let's, let's switch gears here. Uh, let's, let's talk about branding.

All right. So I still like that one. That one, that one's a favorite. Yeah.

[00:29:45] Garrio Harrisson: Yeah. Yeah. And it works, worked for this topic.

[00:29:49] Mike Grinbeg: Um, there's been a number of rebrand, like just in the last week, I feel like that have popped up, that all to me scream the same issue, [00:30:00] which is are we actually building long-term brand capital or not?

I'm gonna share a few things here. Seven up. Okay. There's a seven up rebrand. Uh, I don't, somewhere in here. I think there's a side by side maybe. I know this one doesn't have it anyway, so there's a seven up rebrand. Pepsi just did theirs, which seven up is a Pepsi company, I believe, aren't they? So there's that.

Mm-hmm. There's are side by side. There we go. And then probably one of my favorites, which you sent HBO O Max, which is now Max, where you can find hbo, O Steph. Um, pretty hilarious this tweet here. So, you know, la last time we chatted about something very different, I, to me this screams to a certain extent, lazy yet again.

But you had some really interesting points [00:31:00] on this in terms of where you want to take it. So I'll, I'll kick it over to you. Well, I,

[00:31:07] Garrio Harrisson: you know, the, I mean, you and I always, always go back and forth on, you know, What's the economic value of the investment being made? Right? Because at the end of the day, it is an investment, right?

Like why this investment, why now? Right? And I'll be honest, and I'm sure our design friends are not gonna be pleased with this. Like, but you know, economically, Pepsi and Seven Up, were doing just fine. Right? Their, their, their mots were established. They've got distribution in, you know, these different places.

You know, if, if you go to somebody, say, Hey, can I get a Coke? Say, is Pepsi okay? Like, whatever their distribution is is fine. So the rebrand to me,

[00:31:57] Mike Grinbeg: Go ahead. Sorry. I, what I'm [00:32:00] envisioning in my head is have you ever, I mean, I'm, I'm sure you've been there, you're sitting at a restaurant and that question gets asked and you just see the, the contortions of the face that the, the loyal Coke or Pepsi person is going through.

Like, oh, what do I do?

[00:32:14] Garrio Harrisson: Right. And, you know, it, it's, it's, they're so similar, but, you know, if you're a diehard Coke fan, sure. If you're a diehard Pepsi fan, sure. You're gonna make that, that call. And if you're right down the middle, you just say, sure. Right. As far as capital, the investment moving from there into the, the coffers of, of Coke has nothing to do with the look and feel of the brand.

Right. It's purely their, their economic model and their distribution channels. Right. You take a, you know, the, the example that we were talking about, okay, well, what does, what does a brand actually do in terms of. Defensibility. Like, no, nobody's competing with Koch and nobody's competing with [00:33:00] seven up.

Right? Like, yeah, you got some of these incumbents coming up, but they're playing a very different game. Right? Um, I think that the amount of capital that got spent on that rebrand should have been spent in r and d figuring out how do we, you know, reduce the impact of sugar on, you know, in our product whilst in maintaining the taste, right?

Whatever. Like I'm just saying like your economic value is people drinking your thing. This doesn't get people to drink more Coke or Pepsi or a seven up, right? Your narrative and your message around why, that's where the investment should have been. And the example that I was giving was around Lululemon, right?

So Lululemon started this whole movement of yoga pants, right? And they down on their brand. The store, the logo, the experience, the way they trained their team. Um, you know, when you [00:34:00] purchased the packaging, like they invested so much in that brand, you could argue, what are they doing? They're just selling yoga pants.

Well, there's so many copycats that popped up on the market after that, and they still maintain market share. And they did that because when all of these folks are doing exact same marketing on Instagram with, you know, you know, beautiful women doing yoga or, you know, different models and different sizes doing yoga, um, it was all about, Hey, look at how cool you could look in these pants.

The brand of Lululemons stood for something different. They invested in a brand narrative, not just a brand. So I, I'm gonna

[00:34:43] Mike Grinbeg: slightly challenge this cuz I, I'm, I'm scrolling through this, uh, article here. I'm gonna pull it up again just really quick. Okay. Because here's a quote. Yeah, people can read that.

You know, a lot of people don't even notice The black is [00:35:00] there says Todd Kaplan, CMO Pepsi. It's an intentional color. We added in with Pepsi Zero Sugar, which will be the lead brand we use Marketing

[00:35:09] Garrio Harrisson: the Pepsi Zero.

[00:35:10] Mike Grinbeg: Yeah. Connect is a master brand statement right now. So I'm only challenging it slightly because clearly they've done the r and d about around Pepsi, zero and zero sugar and this, that and the other.

We can, any health conscious person, I don't, that's worth their salt, I don't think will actually buy the zero sugar thing. Like it's still not good for you. Uh, but that's a whole separate story. Um, but I, I think we're, the thing you're talking about is valid is I can only imagine the amount of money. Both internal and external resource that went into this.

Mm-hmm. Where all they have to do is just make the logo bold, slap zero sugar on it, call it a day, we're done. [00:36:00] Like that's really all this is. Right. And really what they're doing is they're, they're tapping into the sugar is the enemy narrative that's been playing out for what a decade at this point. Like technically, you can argue they're late to the game with this rebrand.

If, if that's what really they're going for. Um, I think the, the problem is, is these companies have so much freaking money they don't even know what to do with it. So it's like, yeah, they're gonna spend a ton of r and d and they're gonna just dump all this into a rebrand of the big rebrand agency cuz that's what people do.

I dunno, it's got my take on it.

[00:36:33] Garrio Harrisson: It's gotta, you kinda hinted at, at something that I, I don't think a lot of folks realize when you do a rebrand like this, it's not just the can and the running of the can moving forward. It's everywhere. The Pepsi brand. Is so every theater across the world, they have to spend to re to, to, to like change that.

[00:37:00] If, you know, there's, so, you know, there's books, there's art, there's, there's t-shirts, there's like, everything has to get recalled, repackaged, and re-put out there. And my, my argument with this is, sure, you're getting a big splash and people recognize the brand differently and so on, but could those dollars have been spent in a more cost efficient way?

Was there, was there a better use for that capital? I

[00:37:36] Mike Grinbeg: think they hundred percent that, that's, that's my argument for it as well. I think they a hundred percent could have, you know, and I think this is why you see a lot of challenger brands. Mm-hmm. Doing much cooler and better things in branding because they don't have the deep pockets of a Pepsi and a Coca-Cola.

Right. So they have to be smarter and they have to go bigger. [00:38:00] Right. And they have to show the ROI to a certain, to not to a certain extent. They have, they have to show the ROI on their investment, otherwise they're gonna go outta business. Pepsi's not gonna go outta business. This, this brand, like barring a, uh, the, the new Coke, if you will, right.

Scandal. Yep. Scenario. Barring that, which that was by the way, I think an r and d failure as much as it was a branding failure. Right. Um, uh, barring that kind of thing, they're not gonna go outta business, let's be honest. Right, right. So yeah. I, I, I think we, I think we can leave it at that. Yeah. All right. So with that, let's give some, let's give folks some perspective on some interesting things we've been seeing.

All right. All right. [00:39:00] So what we wanna talk about, you and I both, interestingly, were thinking about the same thing with or without this article actually, that you, uh, that you shared with me, um, which I'm gonna pull up. So I, I'll let you talk through it. Like, well, you, you sent this to me for obvious reasons to you, let's share that with, let's share that with the class and we'll go from there.

Right.

[00:39:25] Garrio Harrisson: Well, the, the, the, the thing that we were, we've been talking about, um, for a while now is just, you know, what is the future as all this stuff is changing so rapidly, what is the future of the. Marketing agency or advertising agency look like in order to meet this new expectations. Right? And the, the, the, the metaphor, pun intended, that's adjacent to this is, um, startup fundraising, right?

[00:40:00] So, or, or capital allocation. So what Andreessen Horowitz did was, that was interesting, is they took existing agency, um, or VC model and said like, look, we're going to invest in the founder and we're going to provide everything or access to everything else that they might need in order to maximize the return in our, so they worked backwards from the return on their capital, right?

Which made them more attractive to their limited partners. Which made founders that wanted to maintain control of their, their, they essentially built a, a nice, clean flywheel. And what was interesting is they could have gone and said, um, you know, we're gonna be, we're gonna focus exclusively on helping you be a better leader.

But they went ver they, they vertically integrated their [00:41:00] entire model to go, okay, well if we give you capital, all of a sudden you're going to be, um, things change for you. Right? And we don't want you to worry about, okay, well what do I do with 5 million? Now that it's sitting there, don't worry about it.

We can help you put that money to work so that you don't, you can focus on building your company. Well, I've never let a sales team before. Don't worry about it. We can help you find the right sales leader to to, to take care of that for you. Um, you know, We've had, we had people that have scaled companies to where we expect you to scale.

Don't worry about it. We'll, we'll help you get there. They look at, Hey, um, I need to get a mortgage from my home. Ah, don't worry about it. We have relationships with Silicon Valley Bank. We can help you get a mortgage. Right? So they, they really went in and said, how are we going? They were backwards from how do we make sure that this founder or this company is successful enough to, to see, [00:42:00] for us to see the maximum return on our investment and what are all the accelerate services that we need to support them with in order to do that.

You saw that with, um, we're starting to see that from an agency standpoint to back to marketing for like creator houses. So if you're a, a creator, a YouTube star, you're probably young. You probably have never seen this much money. You probably don't know how much you're worth to a brand. Like there are all these things you don't know.

So they created these or you don't have. If you had access to filming resources so you didn't have to be doing all the work yourself, could you create more content? So they create these creator houses that, hey, you get to make cooler stuff cuz the equipment's cooler and it's just bigger. YouTube did this, um, with their creator spaces, they can broker those brand deals for you, right?

They go and they work with the brand, like, hey, these are the creators that you should be working with to, you know, for an influencer program. So they took care of all that [00:43:00] for them. And, you know, my, my my, my thought here is we're gonna start to see agencies get away from, hey, we do social and hey, we do, um, uh, performance based marketing, or Hey, we do LinkedIn, or whatever it is, to what business problem do you have that we can help you solve and create services and like this business models to specifically.

Uh, service that, and I think it's gonna come back to revenue. Like, how can we help you a hundred percent make more, make more with the investment that you're making

[00:43:40] Mike Grinbeg: in us? Totally. So here's, I'm gonna share an, a really interesting example. It's not an agency per se, they're actually a tech company. Um, we, we spoke with their CMO recently, and she should be coming on our show, on our, on our, uh, master marketer podcast at some point soon here.[00:44:00]

Um, so it's this company called Nimbus. We're not associated with 'em, they're not a client free publicity. Uh, so Alison, here's some free publicity for you, um, if you're listening or watching. So what I do is they're technically a banking technology company at the core. Okay. But they help niche, they help develop niche banks.

So they do everything from helping 'em validate the concept, the branding, the launch plan, the marketing, and then that leads them to their core product. I, I believe is all this backend, you know, technology, right? So they've got like banking as a service, online banking, yada, yada, yada, onboarding operations, et cetera.

Blending like, it's the technology that's the core product, but they do all these other things to help launch the brand. Right. And I love where you're going with what you were talking about for marketing agencies, because that's how we're thinking about Proofpoint. I know that's how [00:45:00] you're thinking about, uh, curious and it.

Mm-hmm. You know, I think the way that marketing agencies have traditionally niched down mm-hmm. It's not completely done yet, but is close to being done. Right. If you think about at one point, everybody was trying to be the, the full service agency at some point, Hey, we do everything for everybody. Mm-hmm.

Like the, the, the differentiator was, we're really good at doing everything. Mm-hmm. Okay. In the marketing space specifically, then it was these kinda micro agencies in terms of, uh, channel specific. Mm-hmm. Hey, we're, we're a PPC agency, or we're in a co agency with this. Then it was, well, we're, you know, PPC for e-commerce or we're, you know, we're social for SaaS or we're demand gen for sass.

Mm-hmm. And [00:46:00] now I, I don't think you can maybe get away with that last, last one still a little bit. You might be able to do that. But I think if you really want to innovate and if you want to grow an existing agency, I really do think you should be thinking about ver vertical integration, which is, okay, what am I doing?

And for who and what else can I do for them? Mm-hmm. So the example, and I'm not gonna turn this into a Proofpoint pitch here, but the way we're thinking about it is, okay, we do what we're calling relationship led growth. Mm-hmm. The outcome of that, of that is growth is revenue at the end of the day. Okay.

What are other things we can do that drive revenue? And one thing, we haven't released this yet, so stay tuned, but one thing we're really strongly kicking around and gonna be putting out there is things related to the employer brand. Because the mistake that we believe people make is they disconnect the [00:47:00] two and the corporate brand from the employer brand, and they treat 'em very separately.

We're, in reality, it's the employer brand can have a major impact. If you do it right, your culture can have a major impact on. Revenue and pipeline. Right. And connecting, you know, enabling personal brands, the things that you and I talk about a lot. Yeah. So there's a, there's a very real service line, or maybe even a separate business that's adjacent that can be created under the same umbrella.

Mm-hmm. So we're thinking about it that way. Um, I know you, you've, you've talked about a number of things as well. I dunno if you wanna talk about some of the examples openly or not. I'll leave it up to you. Well,

[00:47:41] Garrio Harrisson: there's, you know, one, I wanna throw this, throw this out, left failure, um, um, that I've been seeing lately that I think is interesting to illustrate this.

So companies that handle, I've only seen a few, a few companies [00:48:00] do this, where they're essentially like accounting firms, right? And, you know, wealth management firms, right? Where they, you know, they manage the, the, the income of, of people that are like a, a small business or mid mid-market manufacturing company.

Right. So they manage the taxes and tax prep for all that. Well what do they need in order to be, continue to be more effective? They need marketing. Right? And before what was happening was agencies, they would have like a, a preferred agency partner. Right? Well if they can have a tighter, if they can be more tightly integrated with the agency.

Right. Cuz agencies need taxes too. Agencies need back offices as well. If they can, you know, have an, an equity stake in [00:49:00] that agency, they can be a lot more comfortable making that recommendation cuz they're sharing the upside. So I think we're gonna start to see, you know, an example that I've, I, I think about with that is like, You know, management consulting, right?

They did. Oh, digital transformation. Yeah. Yeah. You need to digitally transform. That is our recommendation. How are you gonna implement it? Well, we, you know, it's gonna walk you down the street here to our digital transformation group, um, which is essentially an agency cuz Oh, what do you need as a part of this transformation?

A new website and a new backend. Well, we have developers on staff that can help you do that. Right? Like, you know, and it just so happens that during that implementation you're gonna find more work that needs to be done that you can, you know, by all means we can help you with, you know? Yeah. And I think that model of, that flywheel of we understand so much about your business, including what you can afford to spend, right.

And [00:50:00] we can recommend and guide you based on, you know, what business goals you're trying to accomplish and help you understand timing-wise. Um, And have these different entities on different PNLs, you we're gonna start to see more and more of that because now you have one person that you're talking with and dealing with.

Right?

[00:50:19] Mike Grinbeg: Yeah. I mean it's, it's that bundling and unbundling. I think it's, we're, we're bundling is happening, but it's happening in these niche spaces for sure. Yeah.

[00:50:31] Garrio Harrisson: I feel like we should do more of these.[00:51:00]