00:00I'm so interested in how you have seen the unfolding over the last decade or two.
00:05Incremental growth is something that you talk about so much,
00:07having direct impact with direct targeted ads in many ways.
00:11But then you've got to think of how a company has got long-term vision,
00:14a North Star, as you put it.
00:16How are companies, small and large, managing to balance this right now?
00:19Yeah, thank you for having me. This is awesome to be here.
00:21I mean, look, incremental growth is about being incremental
00:23to what would have happened without you doing your actions.
00:25You need to be incremental to what would have happened.
00:27You need to see what the lift is of your work.
00:29That fits totally with thinking long-term and what is your North Star?
00:33What is the goal you want to achieve?
00:35That is absolutely a question of, like, I have a goal.
00:38How do I incrementally lift that goal?
00:40Your North Star was writing this book in many ways,
00:44as well as the day-to-day in which you're understanding the analytics underneath,
00:47what's happening in terms of marketing for Meta and the growth story.
00:51Why did you put this out here into the world?
00:54I mean, my North Star for the book is to be useful.
00:55Like, I want small businesses and large businesses to be able to actually be better at using the tools.
01:00Like, you go back, Ogilvy on Advertising, 1985, Bible, absolutely incredible book.
01:05But there are new channels that have evolved since then.
01:08Digital marketing is 75% of the global advertising industry.
01:11There's no book for that.
01:12I kept being asked for a book for that.
01:13So I wanted to produce a useful book to help people be good at that.
01:16Alex, in the back part of the book on AI and its impact on marketing, you talk about an audience of one.
01:24The idea that the AI can make the ad so targeted to the individual.
01:29What are the risks with that?
01:31You're clearly needing a lot of data about that person to make that audience of one relevant ad.
01:36Yeah, I mean, from my perspective, there are clear, now we've reached the point where there are clear laws out there, there are clear platform policies out there about purpose use limitation of data.
01:46And so it's very clear what you can use the data for.
01:48And people like personalized ads.
01:50So people have control over what data you can get.
01:53Young people really understand how to manage their algorithm.
01:56And they love the personalized ads that they get where there's something relevant that's actually useful for them.
02:00So I think the balance is actually in a way better place than it was, say, 10 years ago in terms of people's understanding of these things.
02:06So I think the risks are much, much lower.
02:08And I think the biggest risk is not taking advantage of it.
02:10You look where Europe is.
02:11You look at how they regret the current regulations.
02:14You look at the Draghi report.
02:15They are regretting the lack of growth they have versus the growth the U.S. has.
02:20And I think one big part of that is they've hurt advertising.
02:22The big picture with Meta has been that all of the work in AI has paid off for, like, the bread and butter core business.
02:31Can you give us any sort of insight into how much more valuable an AI-powered ad is, what the conversion on it is relative to traditional advertising, how it drives growth on the top line?
02:43Yeah, I mean, you can step back completely.
02:44Our business has been completely transformed by AI.
02:47When TikTok came along, like, five years ago, everything that you were looking at on Facebook and Instagram was connected content.
02:57Today, the majority of Instagram and Facebook are unconnected content.
03:01And you can see in our earnings results what the impact of AI allowing you to rank content based on semantic understanding of content and semantic understanding of the individual does for engagement.
03:12And then you see it, too, on the ads in terms of the revenue that's coming through and the results we're providing for advertisers.
03:18So it's very high double-digit percentage uplifts if you adopt things like Advantage Plus shopping campaigns, make sure you feed the data through with Cappy, and do the basics right, which I describe in this book, both with Meta but also using anyone else's tools.
03:33What about human creativity at this moment?
03:37Yeah, one of my struggles is creativity is always about pixels.
03:40And, look, I love my creative team.
03:41They're incredible.
03:42We closed Fifth Avenue.
03:43We had Lewis Hamilton do donuts on Fifth Avenue.
03:45It was amazing.
03:46Things were great.
03:47Like, and it really, really worked.
03:48But there's a ton of creativity with data.
03:50There's a ton of creativity with targeting.
03:52There's a ton of creativity with conversion rate optimization and flow optimization.
03:56And what I get at in this book is creativity in the factors where it isn't David Ogilvie saying stick a car to a billboard with superglue to sell superglue.
04:03It's creativity in how you use data to give people amazing personalized experiences and high conversion rate flows.
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