Latest / Reframe First / Christian Jacobsen, Partner & CEO at The Many Studios | How Brands Are Evolving in the Age of AI
Transcript
- Oleksij Rak: Hey guys, welcome to another episode of Reframe First. I'm Alexey, the host of the podcast and let me welcome our today's Christian Jacobsen, co-founder of Daimony. So, hi Christian, it's great having you here. Christian: Thank you very much. appreciate ⁓ having some time to chat with you this morning and exploring where your podcast goes. Oleksij Rak: Yeah, awesome. Thanks a lot for joining. And from what I learned about the company is you're kind of already a group company, but you are a full cycle marketing strategy agency that helps brands grow via some marketing and content. And you're kind of working with some huge brands like eBay, Juliette and others. So that's impressive. I would say so could you tell us more about the agency? Christian: Sure, happy to do so. So I'm one of the co-founders, and the company is about, I don't know, 16 or 17 years old. And we are an integrated, now global, primarily ad agency, although we've been expanding beyond that. We originally started as a purely creative agency. I was actually born more out of Red Bull, and that relates potentially to where I explain where we're headed as a company. But over the years, you know, and we were launched out of the United States. We're now in Australia. We're also in Canada. ⁓ We've just completed our first kind of buy side transaction where we've just brought in an immersive tech company into our world. So we're starting to expand beyond our core premise. And it's all based on our strategic expertise, which is around the concept of participation, where we really look at a brand's audience, their community, we help them build this and we help them harness this community. Oleksij Rak: Yeah. We're starting to expand our program to facilitate the participation the students who are interested in participating in the program. It's a community of thousands of supporters of this community. We do have a lot of students who are interested in in We're doing this in a more positive way. It's a good thing that we're doing this in a more positive Christian: ⁓ we do classical advertising as well, but this is a space that we've always been in since, you know, our founding. It's the thing that's made us most unique and it's our thesis as we move forward is what will be most important in our industry as we face all the challenges that are coming from technology, automation, the agents and all of that stuff. You know, some sense of human participation and involvement is really important to us. So we're using that thesis to expand, to expand our company. Oleksij Rak: Mm-hmm. Christian: ⁓ and as you were saying, we've primarily been based out of Los Angeles and through the course of our history, we've typically worked with really established brands to help them rethink the way that they're going to market, change some of their approaches, launch new products. So typically, you know, large blue chip U S brands, but we're expanding me on that. Oleksij Rak: Awesome, that's impressive history and like 15 plus years and working with huge brands. How did it happen that you started working with such huge brands? Like from what I understand you started with Red Bull and then... Christian: Yeah. Well, we have an interesting founding story just because a number of us had been working on the Red Bull brand. And that's kind of my personal journey where I started on Madison Avenue, learned the classical ways of going to market through large, very established global agencies, and then ended up in the early days at the agency that helped co-create Red Bull with Red Bull. It was kind of born out of an agency. It's called Kastner Partners. They're global. Oleksij Rak: ⁓ huh. Christian: And they had very different approaches. And Red Bull is a brand that always did traditional advertising, but it was a much smaller percentage of how they would spend their money versus all the things that they're known for doing. All of those interesting events, activations, community building, or oriented activities. And so I would always look at this as, ⁓ you know, they had a pull strategy versus a push strategy, you know, where a lot of classic brands might have a very small marketing team and a big media budget and they push it out. Red Bull flipped the paradigm. spent a lot less money on media, had a larger team, but invited people in. And those people helped build that brand. And so we all learned a unique way to think about marketing. And then we brought on some creative partners that were also doing more non-traditional approaches. And so we founded our agency off that premise. It was originally called Mistress, which is a name that went through a cultural change. And we grew, so we outgrew this. But we immediately started working with large brands to bring a different kind of thinking to how they went to market. And the opportunity that basically landed the agency on the map was ⁓ Hot Wheels, which is Mattel. ⁓ And typically they had for, you know, as long as they could remember, created toy ads for kids. They actually engaged us because they had an appetite to try different things. And they were thinking, maybe we do a stunt. They knew that we had come from this world. Oleksij Rak: Mm-hmm. Christian: ⁓ we had great connections with them. I'm a brand strategist, so I jumped right in into their brand. And we did a lot of work around where kids were and realized they're getting older, younger. They're looking at games. They're looking at entertainment. The problem with Hot Wheels is there's no, there are no characters. There's no narrative. There's just toys. So we actually created a whole world and we eventually built life-size, ⁓ Red Hot Wheels, ⁓ toys. a door that was a hundred Oleksij Rak: Mm-hmm. Christian: foot tall and we actually brought it to the Indy 500 and we set a world record. went to the X games with another toy. So we started actually adding these new dimensions to their brand and changed the way that they were thinking about themselves as much more of like an entertainment oriented brand. If you think about like Transformers and they had a movie beyond just the toys and that put us on the map and actually opened us up to many other large brands that just realized we were a small place, but we thought in really big ways. Oleksij Rak: Thanks. Christian: And that was our specialty. We had all come from larger brands anyway, so our ideas always required more resources. It was always a challenge to maybe work with startups. We're not experts in the early days of trying to generate traction, although we've created some of our own brands and products on the side too. So that's kind of our genesis story. And then over the years, we've expanded to be full service where we have all the data and analytics that you could need. Oleksij Rak: Mm-hmm. Thank Christian: A whole suite of tools from a media perspective. We do a lot of business now in the media and buying and planning space. ⁓ that's, think go to market and, and strategy around how you actually connect with your customers has been a core proposition of ours over the past few years as clients are trying to figure out like, how do I spend my money? There are myriad ways to go to market. ⁓ and then we still do all the creative things, but our, our expertise and what we're focused on is really that community. Oleksij Rak: you Yeah. Christian: really how do we get that community into that brand? How do they help that brand? know, from just say engaging to co-creation to maybe even co-invention in the future. But we think that this is a really potent lane and it's one we've always played it. Oleksij Rak: Okay. Yeah, that's impressive. With regards to convenience, that's what I'm hearing recently. Especially coming from the tech world, like in San Francisco in 2010, engineers were the top of the world. Then all of a sudden, in 2015 to 2020, it's about product. It's about building product, it's product people and so on. But nowadays, products are commodity, engineers are tons of engineers on the market. Christian: Mm-hmm. Oleksij Rak: with all the layoffs and all of a sudden go-to-market strategies are alive. People benefited from the shift. And what I'm hearing about like go-to-markets recently is go-to-market is all about building the community first and the product second. And this is something that you're referring now. Christian: Yeah. I just to build off that, ⁓ you know, there's classical go to market strategies and there's a classic, like, I'll, I'll just give you two, two scenarios. So one is the classic way that a, like a CPG product launches where somebody has the idea. You know, they create the idea, they create some kind of proof of product. They raise some capital. They get that into the marketplace. They work on their distribution. Eventually they market this and then they have to figure out how do I. beyond the small group that I create traction with. And usually they're going to create traction because they know this intimately. And if it's kind of sticking, they, then they try to figure out how do I talk to mass folks, you know, and eventually that grows. And that's typically where the agency would step in and say, here's how we get you higher up the funnel. Here's how we find more efficiency. We've seen a disruption in this over the past five or six years with the creators. And this is a little bit more of what you were referring to where if you think about Mr. Beast or Oleksij Rak: Yep. You Christian: You know, the unwell brand or many of these brands that have launched Dude Perfect has gone there. So many of the creators started in content creation, built an audience, and then actually have rolled out products. So they flipped the paradigm where they're actually, they are the talent, they are the authenticity. They're actually creating an audience and then they're interacting with their audience, finding what their audience would like from them, launching products through them and letting that audience scale their products. It's a totally different paradigm. Oleksij Rak: there. you Yeah. Christian: ⁓ we are not in that business, but I'm fascinated by that business because it just seems to, well, we'll, we'll see, but it seems to help these brands really accelerate because you have one of the most important things from the start, which is that community. And you've kind of built that community with a different set of economics than if you're trying to do it through pure advertising. Oleksij Rak: Do you think it's something you can repeat? Is it something repeatable or is it just here and there? And it happens occasionally. Is there some playbook after becoming a Christian: I believe... believe it's replicable. And I've, I've experimented in this and, and I do think that there is an opportunity for more creators to, to actually create and monetize their brands in different ways beyond media. As long as the, as long as there's an authentic connection there, the problem is it's a distraction. And I was even just reading with the unwell brand this week, you know, how there's a bit of chaos there. just because the core founder and her husband's the CEO, she's so consumed by the content. You're making content, it requires a lot of time and energy and planning. It's also hard to run a scaling business if you have a growth business on the side. And so juggling that is a different kind of skill set. So not everybody will make it unless you build the right team. But I do see that there's a real potential lane here. And if you think about so many of the large, Oleksij Rak: Thank Yeah. Christian: consumer good products that we have. These brands have been around forever and they have a moat, is all those years ⁓ of investment, all that distribution, powerful sales staff, being on the shelves, but technology is disrupting this. And I can imagine, and those brands operate, think, personally, out of my experience, more out of like maintenance and fear because Oleksij Rak: ⁓ yeah. Christian: These folks don't run those brands. They're just there for a certain amount of time. They're building their careers. They're maintaining where these brands are. I could see a world where this gets disrupted in a way where there are many more new products and brands that are launched from people that potentially the world thinks are interesting or cares about, and they have a tighter story and they're not trying to dominate globally. And they actually eat more and more share because there's more authenticity to them. Oleksij Rak: You Christian: something there, it's not being manufactured by advertising or marketing. ⁓ it's coming from those people, especially due to the fact that we're losing those scale opportunities to tell those stories, like the most interesting man in the world or, you know, dove real beauty. When we had those big mass channels where we could create a narrative and put that and inject that narrative into culture and give that brand meaning because media is fragmenting and so fractured right now. It's really difficult to do that. You don't have all those consistent eyeballs. You can't just pound that message. Oleksij Rak: you Christian: So I think being flanked by creators and new brands could really have an impact. We'll have to see. And they are going to have all these new tools that are going to enable them to create at scale and have intelligence that they never had before to run these businesses. Oleksij Rak: Yeah. Exactly. We've touched technology a few times already, in the modern world with current technology, can create, especially when it comes down to digital products, you can create them easily. And there are a lot of stories of one person startups that are growing like huge. And if you have this mixture of skills of being a creator and a bit of an engineer, you could have a bright future. Christian: It's a fascinating time. so where I am in my career is I don't work within my agency on the day-to-day level. I'm writing books. I'm writing a sub stack. I'm basically, you know, an evangelist for participation. I sit on our board. I'm helping manage the trajectory of the company, but I'm also doing lots of little experiments on the side. So I'm building intelligence products on the internet related to what I'm, you know, I'm, I'm, ⁓ Oleksij Rak: Yep. Christian: I'm involved in some ⁓ &A, I'm working on a content studio where we're creating shows because I think that's quite interesting. Media is really changing again through technology and there's an opportunity there for storytelling and IP in a different way. But I too am involved in just examples of like what you were just saying where I'm working with ⁓ an entrepreneur and there's a product called AI Team Scout. ⁓ And this is actually a trained AI that can help Oleksij Rak: Yep. Christian: So in the U S we have, ⁓ know, football, like American football is our, is our largest sport. And there's so much money and attention. And, ⁓ and we have these new regulations now where, where, when people go to university, they can actually get paid either by that school or by brands, which we, which was prohibited in the past. So, and, and our, and our educational system is kind of broken where the cost of university is like through the roof. Oleksij Rak: Yeah. Mm-hmm. Christian: For a lot of these parents, the idea of spending an enormous fortune or going into debt to send your kid into school versus giving them a scholarship through sports to potentially even having them get paid for playing the sport. There's a huge delta here of opportunity. And so there's a lot of pressure and emphasis on having kids develop in athletics because it could really help the family and things are breaking down and the kid can actually make quite a bit of money. Oleksij Rak: you Christian: Football offers a huge opportunity, but there's a problem, which is the recruiting system and knowing what school you need to go to and what are my best and what is the roster? If I'm even going to go there, am I going to get playing time? You know, is it the right way to spend money? So I work with an entrepreneur who actually built an AI tool that actually helps do this. And it's him and a developer and just some people that he has on the side. And they are a reflection of this new era of entrepreneur right now that are using technology. And then we helped him by actually creating a podcast where he was building his product while speaking with people. And so it was a recursive loop where we would run basic podcasts. He would be exploring the product with folks. They would give him feedback. would, he would go back and advance the product and, ⁓ and the loop continues. And I think this is a world that we're going to all see develop over time. many of the folks in Silicon Valley are talking about. single company billionaires at some point. Who knows, but anything's possible. Oleksij Rak: Yeah, one person with unicorns. Yeah, some altman was pitching that idea, but it's close. Christian: Yeah. So it's a fascinating time. And, ⁓ for me, I'm just staying very open, ⁓ as to where it might go. I, my industry and what might be interesting for you and, and, and your community is just, you know, I'm, on the front lines because we're in the States primarily, and, ⁓ and we're on the West coast and, ⁓ and I'm in advertising. So with all this new technology that's primarily from the West Coast of America, if you listen to any of the podcasters, like the first thing, especially the abundance community, the first thing they talk about is marketing is dead. Everybody can market now. So I've been navigating this company through these changes since we were founded. You know, we've had media changes, but the last... Few years have just been wild because we've had all the macro economic changes that really have happened in the States based on how we responded to COVID, you know, our political systems, the different wars that are around the world, because my industry is driven by consumer optimism and consumer optimism kind of, ⁓ that informed CEO optimism as to how much they want to invest into driving their business growth, you know, when they set goals. So I'm, Oleksij Rak: Yep. Christian: I'm downstream from those decisions. Those decisions are impacted by the macro conditions. And then on top of that, like I noted, we have these creators that are highly influential in the States that have basically driven, think, I don't even know the size of this business, but it's been exponential growth and they're driving so much kind of business for brands right now that they've eroded a lot of traditional advertising. And now we're facing all the new technologies. We thought blockchain was maybe going to have... Oleksij Rak: Mm-hmm. Christian: create a bigger hit than it has. but AI is highly debated right now. And, um, and so we're facing a number of technological kind of challenges that were we as a, as an industry are navigating every single day. And there's a lot of debate and a lot of tension. And you also just have all these folks going, ah, it's all dead. You know, it's going to I think even professor G, one of the main pundits right now, just, I didn't even read, I just saw the topic of his podcast last week and it was like, Oleksij Rak: Hahaha Christian: advertising is dead in two years. That might have just been a provocation, so I should be careful. But there's a lot of that being thrown out. So we could talk about also what I've been seeing and what that might mean in terms of opportunity and some of the challenges that we face if you want to go into that too. Oleksij Rak: Yeah, sure. That actually was my next question, especially since our conversation is going that way. So is advertisement that or not? What do you think? And what actually do you see? What trends do you see nowadays? How do they affect your... Christian: Yeah. Well, yeah, maybe I'll attack a couple of the big trends and then I'll give you my answer because I've got, I mean, I have a book and my book is coming out in October and my book ends on kind of that provocation too. And who knows is really the thing, but I spend a lot of time on the tools. I watch everything, I read everything. I'm traditionally a Luddite. I was one of those guys where I did everything analog. You don't see me on social media, you know. Data privacy, all that type stuff. And I've had to completely change my worldview over the past few years because it's just here and you can't deny it. And I've been talking to my clients for years about the fact that every company is a tech company, even though they didn't think it because tech has set a tempo and we are all working to a tech tempo. And that tempo continues to increase. And if we don't embrace it, we're all going to die because that tempo won't stop. are too many dollars invested into it. And the reality is it started with the social media platforms. So the tensions that... Oleksij Rak: Yep. Christian: I think some of the biggest tensions that I'm seeing from my industry, which could create massive opportunities and people are playing with them right now, one is in this world of increasing synthetic data and personalities, what is real and what isn't? And again, I'm in the U S where everybody's questioning what is real and what isn't on a daily basis. ⁓ it's probably a unique situation compared to like some of the other countries that we have an office in where they, they're not feeling the same thing that we're feeling when I talk to the leaders of those offices. ⁓ but here, you know, we're, we're, questioning everything and, ⁓ and we're flooded with, with data and information. So if you even just look at like how humans buy, make a purchase, you know, you're going to read or do some research before you buy something. Oleksij Rak: Thank you. Christian: But like 30 or 40 % of, I think it's 90 % of people are gonna read some kind of review, but there's over 30 % of reviews now are bots. There's like all these ⁓ influencers, they're like fake influencers online. There's a ⁓ large degree of traffic that you see on the social platforms, which have been so influential now, that are also bots. ⁓ Many of these platforms are really open for the bots to actually just start reporting. So we're running into this space of, Oleksij Rak: Yep. Christian: And then if you just think about, you know, clicks and impressions and the traditional ways that we measure things, you know, it's, I've read something it's 35 or 40 % of just the internet as a whole is actually just synthetic interaction between bots and bots. All right. I, I've been, yeah. Oh, please. Oleksij Rak: Yep. Yeah, absolutely. We actually work a lot with travel and we are seeing that in travel industries or so. It's growing, you know. So one of the podcasts I had, like a lady who told me she is from destination management company. She's telling people are coming with images they are from. We want to go to this cave restaurant. She's like... There is no restaurant here. People purchase tickets, they purchase some tours, they came there and like, we want to go to this restaurant. She's like, there is no restaurant in cave. There is no cave. Christian: ⁓ my gosh, yeah. Wow. So that's like a whole other degree that I hadn't even considered, but I was going to talk about our products even real. ⁓ The first thing that I think that we're all going to grapple with, if you see like Mark Andreessen was posting a bit about this recently, some other folks have posted about this, which is this concept of proof of humanity, or I refer to as like, why I'm in the business of participation is that people really participate. Like that's a proof that humans are there. Oleksij Rak: Yeah, yeah, sure. Christian: So I think proof of human from a marketing perspective is going to be really important. And there's a massive tension here because people, how do you prove your humanity? Like I recently signed up for Stripe and it gave me a heart attack because I had to give a bunch of my information, but I don't know if you ever done it, but there's a number of selfies that it wants because it's actually, and it's not straight. It actually wants multiple to act because things could be faked. There's a real tension that people are going to go through. in giving away your biometrics to prove that you're human. There are some platforms out there like World ID and I heard Snap is trying to do this, you know, Iris like staring in and look, I don't know, but brands are going to want to know that the folks that they're interacting with and the media that they're buying is actually consumed by humans, just not bots until it's bots and bots. So I think this proof of humanity has not been figured out. ⁓ There's going to be a lot of tension here. And I think as the AI proliferation of content continues, this is going to become a massive conversation in my world. ⁓ How do we verify that's a real human? What is the value of a real human? ⁓ And what is the role of a real human? To me, when I think about brands, advertising drives transactions, but actually advertising also has created an emotional engagement or attachment to brands that helps drive preference. The machines are going to drive the transactions, but the humans need to have an emotional connection. So how do we do that? You know, with the real human. So this is something that needs to be sorted out on the other end of the spectrum. My industry is facing a real paradox because we've for many years had a lot of pressure on pricing and, our speed to market and our pricing versus the amount of deliverables. Oleksij Rak: Mm-hmm. Christian: And humans have not been able to meet this conundrum, right? Because the cost of having a human to do these things. And so, so many people have been overworked, burned out, frustrated, and so much of the work is becoming ephemeral. You know, you're just putting out something in social and it's not there. So all that work, like, what was it for? Technology actually offers the promise. Like, hey, we can help this, solve this issue, which has been a 15 year issue and growing tension between a client and an agency. Oleksij Rak: There. Christian: because the clients are feeling the pressure and the agencies are feeling the pressure. So when AI first showed up, everyone was like, wow, this can actually help us solve the problem. The challenge is right now, we haven't figured out how to use it. And there's all these promises of, and we've seen the $2,000 Coca-Cola ad or the Cal-She ads or whatever they might be that were clearly put out there based on AI. And that's fine. But ⁓ the bigger issue right now is that the Oleksij Rak: Yeah. Christian: broad set of brands and clients that are out there in the world of marketing are still very fearful because they're in spreadsheets all day. They're not like on the frontier models all day long pioneering in technology. So they're concerned about their data. They're concerned about rights. They're concerned about legality. Their job is to step steward these really large existing brands. So they're very risk averse. And so they are basically not fully engaged in how to use this stuff. And they don't really want to give their agencies pure agency to use it. However, they're still pushing timetables and compressing what they're willing to pay because their margins are getting cut within their own company or their budgets are getting cut, you know, in terms of efficiency. So there's a squeeze that my industry is feeling right now, which is margin and cost compression because the clients are driving it down and they expect that, Hey, you have some efficiencies due to AI, but just don't use AI on us. Right. And so I have no idea how that's gonna get resolved either. So it's a wild time. Every single day there's something new we have to navigate. Oleksij Rak: ⁓ Awesome! ⁓ Christian: So on all that, know, we'll see. We'll see where advertising ends up because we started this question, you know, is advertising going to exist? It's a really great question. You know, on one end, people are saying there will always be a role of human salespeople, humans, craftsmen, AI kind of is better looking backward than looking forward. Maybe it gets better looking forward in terms of new ideas. ⁓ There's always a role. for a company to be fired. know, like there's, it's nice to have a third party that you could fire if you're running marketing. So there's a role potentially of an agency there. ⁓ but on the other end, there are agencies that are being created every single day right now, because we have well over a hundred years of, of research and data on how our advertising works. That they're just training. They're just training the machines to be able to, to do the persuasion, to do the persuasive work. I believe that like that work is going to get optimized. That work will be replaced. ⁓ to push the creative boundaries, humans will orchestrate this. but, ⁓ but there's going to be a bunch of other advertising and marketing work where humans are going to be really valuable. And, our thesis is one where we need to automate how we develop and create a move things through a pipeline, but we still need the creativity, the strategy. And I think, the human connection. Oleksij Rak: Yep. Christian: as a part of this so that we can create very human oriented outcomes, you know, and whether those are more live events or different ways that people are experiencing something or connecting with a brand, that's going to be valuable. The industry that we probably have known for so long that we've been training machines on, we might've optimized ourselves to the point where they're just going to do it better. And because we're moving into hyper personalization, the machines are going to do that better on their own. So that's kind of where my head's at on this stuff. Oleksij Rak: Yeah, there are a few dimensions to that that you mentioned. ⁓ First is the dimension of trust. ⁓ That you need to trust somebody and that's probably where creators will succeed because for both in here and for other businesses, they are more more relying on creators. promote their brands and to bring their customers to the companies. Another one is a tool set. A tool set is still not there. That's what I'm hearing from local creative agencies that like, there are tools but they have no clue how to use them and have to use them like in a proper way to make something. But tools probably will get there. Yeah, and the third dimension that I see is like, will the digital marketing exist at all? Because in the end, you mentioned hyper personalization and stuff. imagine that's like theory that you have on your iPhone is all of a sudden is getting smart, not so dumb as it is. And when I need to buy a new pair of shoes, I will not... probably go to Google anymore. And I will just tell like, hey, go find me a pair of shoes. It already knows my color preferences. It already knows my style preferences, my sizes and so on. It just goes and buy something. And is there a room for digital marketing? Is there a room for CPC ads? Because it will just go to some platforms. search for some results, show me three options and I will choose probably this one. What do you think about that? Christian: hold on where you just were. And then I want to ask you a little bit about the tools and the creators. I think it's all fascinating for me. So I would, not trying to one up you here. But I, I, I'm like one of those people who I see the agentic world coming. I'm playing with agents, you know, I've got some products that we've done with claw bots, I've done stuff with Claude code. I subscribe to the future. And I don't know how far it will be, where it won't be me talking to Siri, it will be my agent. Oleksij Rak: Yep. Christian: saying, Hey, Christian, you know, I know you love those shoes. They're on sale. You me to you want me to pick them up? They're in your favorite color right now. And, and I'm probably it will be ahead of me. I think the agents will be ahead of me and the agent will then go deal with the Nike agent or whatever creator created those shoes or whoever it is, and there'll be an agent to agent transaction. Now again, I have to be comfortable enough to give all my you know, Oleksij Rak: Yep. Yeah. You Christian: Financial data, but agents already making purchases anyway right now that we know we're claw bought So I I think we're gonna head to that and so your question is really important, but that is the world that I believe it will be so hyper personalized that your agent will be ahead of it and Your age will be getting messages from other agents and it will defend you from What will be I think a lot of AI? advertising pollution that we're gonna deal with we're starting to deal with so ⁓ Oleksij Rak: Yep. Christian: So that's why I believe in the participation side, because at least if you want to believe in the brand, because you might not even be seeing the ads, your agent's going to be getting the correspondence. know, seeing these other things we're invited in or, or realize what that brand really stands for, ⁓ will be important. So digital marketing is going to transform. It's the, it's the first thing that's going to get hit. and the, the, the really, kind of tragic or ironic part of this. In my, from my perspective is that over the past few years with the macro economic changes that we've faced, creativity has taken a dip because the tenure of marketing people has shortened. ⁓ because we're looking at results on like a daily basis right now. And so they have so much pressure on them to deliver a very strong ROI and to defend how they're spending money to their CFOs and CEOs. that everything has become so performance-based and so data-based, ⁓ which is fine because like the work actually works. There used to be a saying where I know 50 % of my advertising spend is wasted. I just don't know what half, right? We far transcended that period of time. We can basically, you know, determine where everything is coming from, from an attribution perspective. The reality though is that That has forced every agency to get really great at data and analytics and really great at performance marketing. And that's the first stuff that the AI is coming for because the AI will be better at that. ⁓ So we've actually been, I think, ⁓ optimizing ourselves in some ways and putting ourselves in a position where these tools are going to come. And those are the first tools that will be built because they're really, really important. And that those are the tools that these giant holding companies around the world, there are whole bunch of them from every major continent. That's what they've been developing. So I think it's gonna hit the digital in a really profound way, to be honest. ⁓ And we just see, and from a trend perspective, I was just reading some data on, Coachella, where brands are now spending in totally different ways at festivals, events, and live experiences, because they think that that's going to be probably the future of where they're gonna be making these connections. Oleksij Rak: Yeah. Yeah, since you're being on the frontline of all of this, all of the change, how do you adapt? What do you do? What do you change? You already mentioned that your company structure has changed and what do you do? What do you try to... Christian: Man. Well, so this is a really great question because ⁓ my business typically is one where there's fires every single day. You know, if you're the client, if you're in any service business, there's always something it's almost impossible. And I've tried this and failed to try to ask your team. That's kind of servicing all that business to also be pushing and pioneering all the all the new entrepreneurial shit you need to do and innovating and trying all these new tools. It's impossible. ⁓ And so what we've done and our approach is that the founders have all taken these different roles where we're starting to experiment and play and do a lot more work. And we elevated out of the day to day. So we created an AI lab with one of the founders who's an engineer. You know, I've jumped into this similar space and another couple of founders have played with this so that we're letting our core business evolve at the pace of the industry. But we, as a company, we can't do that because who knows what will happen. So there's a small group of us that are kind of more pioneering and playing with the frontier labs and figuring out where these things are going and trying to find. Oleksij Rak: and Christian: the right spaces for us to play and have the right philosophy. And to the point you were making before that we should get back to the tools. What are the right tools that we should be building so that we can bring them into the company at the right time. So it's a holistic strategy, but at first we just said everybody jump in to use these tools and it's, really difficult. Everybody's, ⁓ tech adoption rate is quite different. ⁓ there's so much kind of fear, ⁓ miscommunication. Oleksij Rak: Mm-hmm. Christian: You know, it's really hard to have a compass of where things really are. then especially for folks that are in the business right now and they're dealing with clients, so many of these marketers are not ready to have all of that ⁓ automation in the system or the pipeline yet because their company is not ready for it. So we have to have kind of a multi-year strategy and we have multiple tiers on who's embracing this and playing with it and seeing what's real and what's true and maybe what's some noise. ⁓ And we've been building our own tools, which is really interesting because you read so much about what's happening with SAS. We've been building our own personalized tools right now in terms of how we forecast, how we're looking at our enterprise. We're building dashboards, things that we would have never been able to do before. And we don't need to go there for exactly how we want to do our management reporting. So there's huge opportunities, too. Oleksij Rak: Yeah. Yeah. That's a smart move actually, because it's really hard to make the whole company use the tools which are not ready yet, but which are evolving so fast and it requires a lot of just time spent. to all the technology, learn all the technology while the team has to do actual work. Trying to move with a smaller group of founders who want to understand what's next. That's what I'm doing. I'm trying to understand what's next. So I'm also working in the services business and I'm running a services business. And I don't know what our services will be looking like in like years time or half a year's time. So that's why we are trying to learn all this technology and understand what's moving and understand like what's next, what's next, like what should be the pivot probably of the business or whatever. So yeah, I absolutely hear you here. Christian: And you'll probably then understand the next point that I'll make. And again, this is just me watching many podcasts, thinking about where the future is, realizing that we are kind of in an intelligence economy right now that will enable us to have pretty incredible tools. So I personally see a swap in terms of service-based. Oleksij Rak: Mm-hmm. Christian: You know, where we use tools for our services to probably more tool-based where the services sit on top of the tools and the tools could be proprietary, but they accelerate things. ⁓ many people probably see it, the world going that same way. And at some point we're going to have to make a switch because we have human labor based, ⁓ like policies, but also like processes right now that, that are very entrenched in every industry. And the larger the businesses. Oleksij Rak: . Christian: These are more more codified, you know, they're, really the norms. It's how things work. But the agentic world that we're transitioning into is going to create new processes. And so it's really difficult to transition a traditional modality and pedagogy of how you do something into this. so there are, you know, many pundits out there saying you probably have to build both. And then eventually like. Oleksij Rak: Mm-hmm. Christian: switch one into the other, we don't know, but there will be a time where, to your point before, the tools will be relevant enough and ⁓ trusted enough that they'll be so powerful that you're going to have to change your processes. ⁓ And some of these, my industry, the processes are so entrenched. And we're pioneering and changing all the time, but you have an entire industry's gravity. of people who go from company to company to company, and like, well, this is how we do it. So everybody does it, you know, any industry has has that same gravity and every large company and probably the larger they are, the the harder this transition will be, the more pain they will go through. And I have no idea what it's going to what it's going to mean. Oleksij Rak: Absolutely, many, either. But yeah, you're absolutely right. At least we are trying to approach it in a way that we like build symbols. Like in the process where we have a bill, like we find the steps, we show the most repetitive and the most library intensive and trying to like build some simple agents that will just handle this small. Christian: you Mm-hmm. Oleksij Rak: particular step, but we'll handle it well. And yeah, it's question of trust, but when you get to the level of failure, to the failure or success level of like 95 plus percent, it's already better than a human. people also fail. And that's probably the point when you can just trust it and if it breaks, it breaks, but in most cases it will just work. Christian: Yeah. So where if we go back to the two comments that you made before, which were really interesting to me, ⁓ you said, okay, the tools that were not there yet, but they're coming. And you've also heard through your conversations, you know, that creators are becoming more important. If you could just give me a little bit more on both of those, because I'm just a student of my own industry. So if we go back to the tools, how far out, where do you see us right now in the world of companies building tools or having their bespoke tools? ⁓ Oleksij Rak: Yeah. Yeah. Christian: Where do you see the next year going? I mean, you come from tech. Oleksij Rak: It's really hard to predict, frankly, but the advancements that we are seeing ⁓ in tools like year over year, they are getting more more sophisticated. I mean the FrontierLab tools. The same cloth, they are releasing new models and right now they releasing, they did not release that new model, Mithos, because they are scared to release it. The level of sophistication is... Christian: Yeah. Yeah. Oleksij Rak: is like incredible. So I understand why people are worried about job security is because a lot of digital marketing, a lot of tech world, a lot of people can be replaced with tools. And I think it can happen quite soon. It cannot be replaced with tools, but it will be replaced with other people who are using these tools. In terms of create... Christian: using it. Yeah. Oleksij Rak: Creator economy. ⁓ It's about trust. I heard a lot of discussions on this channel already and everybody is mentioning people want to rely on other people's opinion. People do not trust auto-generated content or whatever content, fake content. There is a lot of fake content. And creators are probably those who can bring this level of trust. ⁓ Especially I was chatting with a lot of businesses in travel industry and most of them are trying to work with some creators. And for some of them it's like 10 to 20 to 30 % of their client acquisitions. That's huge. Google is still big, but these are niches that are growing. Creators plus LLMs. People are coming from this agentic harnesses like lot, whatever, chat, GPT. And these are two niches that are really growing fast in terms of customer positions. That's why for creators, this is a big economy that's growing probably. So it's great to have a skill of a creator nowadays. Christian: Yeah. It's, I think, ⁓ just to build on what you were saying, travel is a fascinating space for both of those when, ⁓ so I'm like a power user on every LLM. ⁓ just part of my job is to be experimenting for the company. And I remember, I don't know, it was like a year ago when chat verse was like, ⁓ everybody's going to have like access to our agentic thing, which was really before Claude cowork. And I remember the first thing I tried was just to actually have it plan a trip for me. Oleksij Rak: Yeah. Christian: ⁓ so the first thing that came to mind was like, ⁓ that's always a complex approach. And I've kind of missed the travel agent, you know, technology came and took the concept of the travel agent out. And I, and at first it seemed like it was a great promise. And now travel is so freaking confusing because you don't even know what sites are stacked on top of sites. And it's, it's such a complex web that I think the LLMs are going to wipe that out. ⁓ but then I want to verify, right. And so before I just noted to you. Hey, we are full of all this synthetic content. I don't know how I can trust reviews. Maybe 30 % of Amazon reviews are fake. So I guess the creator serves that need then to your point, because if I do some preliminary work in a, in an LLM, now I'm going to go watch a real authentic human. And they're not just going to tell me like in a written review, ⁓ this place was great. They're most likely have a camera going, ⁓ here I am. And I was just in Mexico, you know, that's where I just was weeks ago. So here I am in this town of Mexico and Oleksij Rak: Yeah. Christian: here's this and this and this is really great. And I actually can make an informed decision. And so while there are a lot of people who are disturbed by how many creators there are, and no matter where you go, there's somebody, like I live in LA, there's somebody on every corner with a camera set up doing something. It is, I guess, providing a utility for people in terms of trust right now in the digital world and making these decisions. Oleksij Rak: Absolutely. And you mentioned travel agents. Travel agents are also doing that. So everybody was expecting that travel agents will be phased out from the market by LMS. They are not. People want to trust some other people. People want to trust somebody who will book the trip for them. So that's why travel agents are still there. And the more I chat with travel industry, the more they confirm that. We were thinking like the travel agents are dead, but they are not, they are still there. Christian: I think about, because I've always been in the agency business, I constantly think about the concept of an agency. And I'm actually working on an essay on this, but it's so, know, the concept of an agency, like a body between two entities is to resolve a friction, right? Technology has always tried to do the same thing. So agencies and technologies are either in competition or they're in combination. So if you think about travel, you know, we had travel agents because planning a trip was really difficult. Oleksij Rak: Yeah. them. Christian: And so you had travel agents when I was younger, technology came in and said, we're going to kill all them. But technology ended up making it more confusing. Now I'm not surprised that the agents are coming back because people just want to have a friction free experience. ⁓ and so there there's always this coexistence. so anybody who's in like that, that, that business in as an intermediary, I keep saying, you know, if you're just the intermediary intermediary of the past, it's probably going to get taken out by technology if it hasn't, but there's always room for an intermediary. Like we just have to keep advancing. So I like what you were even just saying. The concept of travel agent has returned, but it's a new version where the travel agent is actually working with or looking at influencers to really try to help the person get the most information they have. So there's a role for service businesses. They just have to stay at the forefront to resolve a friction. You know, if you're just trying to do what you did pre Oleksij Rak: Yeah. Yep. Christian: agentic world, it's going to get wiped out. But what can you be doing ahead of this? What new frictions are going to come out of this that you could be solving for? And most likely in collaboration with these tools or orchestrating these tools. That's what the economy is going to be. Oleksij Rak: Yeah. Yeah. And actually, to add up on top of that, I've had a few discussions in the industry with different companies in travel industry. Some companies are thinking like that, and I've read some posts, some comments, LinkedIn, whatever, so that intermediaries will be out of business, especially in travel, because there is huge... user with his agent or the LMA or whatever and he can just, the agent can just book a trip or whatever from his end service provider, whether it's like hotel or a tour guide or whatever, you know. And then, and the intermediary market is like shrinking. ⁓ On the other hand, I was chatting with some light travel agencies, these big ones and they're like, no, no, we are not, we are not out of business because... ⁓ Christian: Is it? Oleksij Rak: Yeah, guess what? We've spent like last 20 years by digitalizing calls and craps ⁓ all around the world. You cannot even imagine the level of how far behind technology all these service providers are. So we brought all of that together and it's in our platform. Agents cannot do that. And in the end, what they are trying to do is they are trying to expose what they have to the agents. Christian: Mm-hmm. Mm-hmm. Oleksij Rak: They are trying to be the tools that agents will be using to book something or to order something. That's what you mentioned. Intermediaries will have to evolve and will have to be agent-ready to be able to stay in the market. But if they do that, they're still in the market. Because the rest of the world, when you have 10,000 service providers and they... Christian: Yeah, I think, yeah. Oleksij Rak: They are structured in different ways and some guys ⁓ do not even have digital presence. They operate via the phone. So it's archaic. And what these intermediaries are doing is they're just gathering all of that together. So probably in each industry, there was room for intermediaries. Christian: Yeah. I think so. And, you know, and then like I was saying, is this place real? Like you were saying before, like there's gotta be some sort of verification on this because people could make up almost anything at some point. So, and then the other really interesting thing to me, if we just stay in the travel business as well is, you know, the great promise of, ⁓ listen with all the agentic stuff that's coming and technology that's coming, it's most likely going to hit us before it helps us. And I don't know how long that Delta will be. ⁓ But if we do end up with a really positive outcome ⁓ of this technology, people theoretically would have more time, more freedom. We see it with virtual work. So travel should be, you know, an amazing industry for the future. ⁓ If we actually go to shorter work weeks or there's more of a virtual work modality or whatever. So that's a really interesting industry just to watch because you're right. It was one of the first ones that got hit by technology. then technology almost killed itself in that. Like, I don't know, last time you tried to use Expedia or Kayak or something, it's really freaking confusing. I just go directly now to the brands because the intermediaries are more confusing. I would love the real human. ⁓ So we're coming full circle and right now travel feels like it's almost impossible in our world, but in the future it might even boom. So... ⁓ Oleksij Rak: Thank Christian: really interesting space to pay attention to. I'll pay a lot more attention to it now, because I think there's a lot of lessons in that space. Oleksij Rak: Yep, yep. There should be some dip and that dip is coming because, you know, more and more is getting automated and like human labor is not needed so much anymore and we see it in all the industries but at some point it should change, I think. We will get through the dip and we will get out of that because... Christian: Mm-hmm. Oleksij Rak: Yeah, people will just embrace that technology, will start using technologies and it will stabilize because nowadays businesses are trying to fight for operational efficiency. At some point when everybody is like operational efficiency, you still need human to use these tools to build something, you know. Christian: And what so many of the abundance people out there are talking about that it's going to be a huge entrepreneurial opportunity for people. there's always been like ⁓ our economy is based on scarcity. But when things become a lot easier, ⁓ there'll be a lot of opportunity for people. And I actually think the new scarcity will probably be humans. You know on the internet like that's gonna be what's scarce. There are going to be so many bots and agents and and fake influencers and all this kind of stuff that the real humans will be the most valuable things to actually get ⁓ That will be the scarcity and so people will probably be building businesses around are there real are there real humans? Is there real community like that? That's gonna be valuable used to be maybe because I have an audience and it's that intention The tension from an advertising perspective, it might be a totally different thing, but I think that will be the scarcity that we're going to experience because all these other barriers are going to break down and people are going to be creating all kinds of wild things. Oleksij Rak: Yeah, for sure. That's an interesting future. We will see. Christian: Who knows? Who knows? Oleksij Rak: Yeah, also awesome, Christian. That was really fun and great discussion, I would say. Is there any other? Christian: Yes. ⁓ I didn't stick to advertising, I'm, you know, listen, because I'm a strategist and I'm always trying to figure out how things work. And I've looked inside hundreds and hundreds of companies. That seems to just be a little bit of a passion of mine. Like just trying to figure out where are we going? How do things work? That's what I've been writing about. ⁓ what I'm excited about, but also terrified about in the future, but we're all going through it. So we have to approach it with optimism. Oleksij Rak: for sure. Is there anything else you would like to add to top of that? Christian: No, think I appreciate the opportunity to chat with you and hear some perspective that you had. And yeah, just thank you for the chance to share some of my perspectives to the world and your listeners. Oleksij Rak: And thanks a lot for joining. That was a great discussion. Christian: All right. I appreciate it. ⁓ If anybody wants to read more about my participation, it's the participation exchange.com. I write essays every week, mostly about my world, but you'll get my perspective. I cover all these same topics from AI to tribal gatherings to what have you, relates to all the work that I'm putting out in the world. So if anybody found any of the participation thinking interesting, that's the fastest place to find it. Oleksij Rak: If you send it to me, I will put it down in the description of the video. Christian: Fantastic. I'll send you some of my contact information. Oleksij Rak: Yeah, sure. Awesome. Thanks a lot. Christian: All right, sir. Have a great one. Enjoy your day. Take care. Oleksij Rak: And you.