1Mby1M Virtual Accelerator Investor Forum: With Ashu Garg of Foundation Capital (Part 3)

Sramana Mitra: Media buying has been the most obvious areas which needed to be automated because of the trends that you described. Machine learning applies very well into that space. Can you talk about other areas in marketing technology, where, powered by machine learning, there is venture-scale opportunity?

Ashu Garg: I’m going to talk about very broad themes. The beauty of entrepreneurship is, startups always prove investors wrong. I’m sure that there are folks in this audience who will have ideas that we haven’t even thought of. With that caveat, I published a book called The Decade of The CMO last year. We talked about five major technology trends within marketing technology and five buckets of areas where I think mostly billion-dollar companies will emerge.

The first is around measuring ROI. CMOs want a seat at the executive table. To get that seat, they need to be able to determine the impact on revenues every time we spend $100. They also need to be able to say that every time we spend, these are the three things that worked that we should do more of and these are three things that we should do less of. While there are a lot of people who solve pieces of the ROI puzzle, it is yet to solved in a holistic manner. That’s one big bucket.

The second big bucket is media buying. As you said, it’s one of the earliest areas of innovation. To a large extent, it’s hard to find interesting things there, but never say never. The third is, all brands are becoming publishers. Content marketing is becoming as important as advertising.

I think there is a lot of opportunity for providers, both on the B2B and B2C side, to build technology platforms to enable marketers to do content marketing at scale. That’s a very hard problem because of the number of channels which you have to do content marketing. The number of pieces of content is very large. That is a large unsolved problem.

The fourth major theme is personalization. Consumers demand personalization of their marketing experience. When you provide a personalized experience, there is tons of data to show that the engagement is dramatically higher. The challenge is doing personalization at scale is very hard. It is a Big Data or a machine learning problem. It also has issues around privacy and security. Technology providers that can solve the personalization problem at scale have a huge opportunity.

The fifth key is around the reinvention of the interface between sales and marketing. We believe that, increasingly, marketing will close the deal. What I mean by that is marketing will go from generating leads and passing them onto sales to pushing the lead through the funnel to the point where you can convert consumers using marketing technology. Dropbox does that. I expect that to happen more often. Those are some major themes.

Sramana Mitra: Let me point you to a few prior sessions. We have interviewed the founder of BloomReach. It’s an excellent company in this whole personalization area. One of the market leaders in the e-commerce personalization area.

We have an excellent case study. This is very close to our hearts because we’ve been very successful using that in content marketing. I share your belief that every brand basically needs to be a publisher. That’s extremely difficult to do.

What have you seen that has caught your attention? What have you seen as example of people doing it well in ways that can become pillars or bases of scalable solutions in that area?

Ashu Garg: It’s a great question. This shift from being a brand marketer who uses advertising as the primary communication channel to becoming a content marketer is a massive one. We see a lot of SaaS companies in Silicon Valley using content marketing very successfully.

In some ways, it’s easier for them because they don’t have a legacy that they are competing with internally. They don’t have the baggage that comes with having done brand marketing for decades. When you look at large brands, they have done a very good job of doing content marketing around an event. You’ll see massive programs around content to engage their audience, but they really struggle to build an ongoing content marketing channel such that as consumers, we can both be entertained and informed by the content they are providing. The reason it’s hard is because it requires a fundamental shift.

You have to build a newsroom and make that a center of the marketing organization. You have to think of the newsroom as the alternative to your ad agency in a sense. It has to be done in-house. Once you have that newsroom in place, that newsroom then begins to distribute content across channels.

This segment is part 3 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Ashu Garg of Foundation Capital
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