In a reality in which the average Internet user spends over 6 hours a day online, more than 2 hours of which in social media, having a successful digital marketing strategy can be a challenge to all business owners. How can innovations and creative automation serve the purposes of retailers?
Following the news about the late-seed €600K investment of Romanian digital marketing startup ProductLead, led by Romanian micro fund Sparking Capital and supported by Bulgarian Eleven Ventures and Swedish Founders Bridge, the Recursive team met with Mihai Bocai, Co-founder and CEO of the company. In our interview, we talked about ProductLead’s story, business model, and future milestones, while also discussing the digital marketing trends that are set to shape tech innovation in the area.
The Recursive: How did you decide to start your company – what is the story behind and how has it evolved?
Mihai Bocai: We come from a service business. Evonomix, the company we previously were part of, is a successful digital marketing agency with a strong background in eCommerce, mobile apps, and social media. However, we understood that a service business cannot be scaled exponentially year over year and it will be very hard to grow fast. The technology arose exactly out of this context and evolved side by side with the eCommerce businesses we were involved with. We went through several iterations/ pivots because we had somehow a unique approach – we wanted revenue from day one, we wanted to build something that somebody is willing to pay money right away. That is why we have iterated the minimum viable products very fast, got customers, got feedback, reinvented the product based on that. Spinning-off the product in a separate company was a natural move and it was anyway requested by Sparking Capital when they first invested.
What is your business model?
We are a SaaS platform and we charge a monthly subscription for our services. We target mid-tier and enterprise tier customers (deers and elephants, how they are called). For us that starts from an eCommerce business that has at least €1.5M per year revenues to top 10 players of an industry in a certain geography. We are ready to operate in 2 modes – self-service or managed services paradigm, leveraging our Customer Success team to guide the customer in setting up the platform, processes, and the creative flows in the platform.
How did you manage to attract your well-known clients (Douglas, Morphy Richards, Fila, etc.)? What advice would you give to startuppers who are trying to attract clients of this caliber?
We work with many known names and our oldest customer has been using the platform for 35 months. I think it is much easier to work with a big name than a not-so-known brand. Well-known brands are in that position because they invested early in innovation and they were early adopters all over. You just need to have the crazy courage to go and ask for a meeting or to make a demo and of course to ignore refusals.
First of all, I would tell founders that it is not as hard as it looks. Solve a problem, prove it, monetize it. However, there is also a pitfall in working with well-known names. It’s more important to get traction from cohorts of customers, rather than serving the very specific and complex needs of a big player. The hardest thing is to find the balance between customers that drive traction and customers that drive your innovation.
What are the current trends in digital advertising, both negative and positive?
First of all, the volume of all online communication increases exponentially – a song launched on Youtube now does in one day the lifetime views done by a song launched 5 years ago. Put that in perspective, add ad blockers, privacy issues, age gates and restrictions, budget concentrations, fake news and clickbait and you just defined the digital advertising nightmare. It’s now harder and harder to reach an ethically targeted audience with a correctly crafted message.
The trends in digital advertising focus on shading light on all this chaos: for one, we face combined revenue models, a mix between subscription and ad-supported models. Another trend is connected to the existence of hybrid formats – live, content streams, and shoppable streams. The industry will face decentralization towards local publishers and micro-communities, while data privacy will push us from micro-targeting to macro-targeting and from a third-party data paradigm towards a first-party data paradigm. Lastly, genuine creators will replace common advertising as we know it.
What are the biggest problems of digital advertising that your solution can resolve?
We address the brands’ challenge to scale a real-time consumer dialogue, one-2-one with ROI. A brand faces today quite a few challenges: firstly, the martech space is very crowded – there are simply too many tools, making it too granular. Next, technology for marketing is getting more and more complex while marketing teams are smaller, with bigger attrition. Customer data to be processed and understood is also voluminous, thus making it complex to adjust marketing operations and to truly optimize budgets for ROI. Lastly, it is too expensive to experiment fast, while data integration is just a chimera.
At a very high level, we provide a technology framework for brands to scale and control a meaningful journey with a Consumer that has a digital attention disorder. The implementations take many forms, from creative automation, to leveraging user-generated content, shoppable ecommerce assets and custom creative formats for various publishing options online and offline. We on-board all brand assets, earned, paid, owned, and we crunch those in our Creative Studio, providing superior creative assets to be further used in the customer funnels. Brands will orchestrate their funnels with a leading content creation platform, integrated at the core of their technology stack, taking advantage of smart social data, automation, and integration. We do not position ourselves as a granular tool, but rather as an ecosystem.
What are the future trends that will shape the digital marketing field and what will be the role of creative automation?
Digital marketing will be shaped by the consumption behavior driven by technological advances. Mobile, haptic, voice, these are all the new normal for the new generation and this generation will stretch boundaries like never before. There is an emerging trend, connected to the run towards privacy and closed micro-communities (groups, Clubhouse and clones, messaging). People are increasingly going to be connected through trends rather than geographical and age proximity. Marketers will have to tailor the brand narrative in ways that strike an emotional chord with the audience by linking it to a relatable situation rather than a straight-in-your-face ad message. Grasping all this information and getting meaning out of it will not be possible without automation. Analyzing big volumes of data and understanding how the brand narrative should be crafted is paramount in today’s and future economy. Creative automation is not an auto-pilot solution but rather an assistant. It will guide marketing teams to understand better the data, to make better use of it, and to speed up the narrative alignment to audience interests.
What are your future plans and milestones both in the long and short term? What are your fundraising goals?
First, we are very excited by the success of this round of investment, which will allow us to speed up our growth. Our business objectives focus on growth and partnerships, on-boarding customers across key industries and geographies, giving us the grip we need to strengthen our value proposition for Series A. A great product is built by a great team, hence first we will focus our efforts on strategically growing our team. Then, we are very interested to better understand how we can best serve CEE, DACH, and Nordics as key markets for us in Europe and not to forget SE Asia as our core interest.