Daniel Head, CEO at Phrasee talks about the disruptive state of modern martech and what’s in store for the industry:

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Welcome to this MarTech Series chat, Dan, tell us about your B2B tech journey and what it’s been like taking over as Phrasee’s CEO since the last weeks?

I’ve spent nearly three decades in Enterprise technology but my journey in MarTech began 12 years ago at Salesforce with the birth of the Marketing Cloud. When I started, marketing technology was built to serve a specific channel purpose and utility – such as email, social listening, social publishing and ads.

Over these last 12 years we’ve seen several major shifts – Social, Mobile, Data Streaming, GDPR and AI. These factors have forced brands to become customer-centric, not channel-centric, so that communications are relevant to the individual and desired by that individual. I was only the front line of this change at Braze, which grew from startup to IPO in November 2021.

Customer-centricity challenged the conventional siloed approach to digital marketing. While email is well suited for some brands or types of engagement, if you’re going to get that recommendation for your favorite pizza place at 6 p.m. on a Saturday, for example, you’re probably not opening an email for that information.

Meanwhile, younger generations, in particular, stopped opening emails and preferred more immediate and engaging channels like Snapchat, Instagram, or WhatsApp.

This transformation led to a fundamental shift in how technology was designed; the pipes need to be able to activate and engage on any channel with consistency and relevance at all times. None of us want an ad for a product we’ve just purchased!

All of this causes a scale problem: Channels x Journeys x Variants x Experiments x Languages means a lot of content is needed. And good content!

Fortunately, the AI explosion has come along at the right time. Prior to ChatGPT AI was kind of interesting, maybe a bit geeky. Now, it’s a mainstream necessity for enterprises in order to automate and scale. The industrial revolution of our time has arrived, and the challenge for businesses is not whether to embrace AI but how to leverage it effectively and build trust in its capabilities.

Customer-centricity + AI content generation is highly compelling to me. Phrasee’s Enterprise advantage in this space and deep roots in architecture and logic are how I ended up here.

Phrasee, with over a decade of experience, is a pioneer in machine-driven language content. Phrasee provides marketers with the best-performing content across their digital marketing campaigns through a platform that is designed for Enterprise workflows. Not only is it channel-agnostic, it is LLM-agnostic. And with a metaphorical “separation of church and state” in that language generation (via an NLG/LLM hybrid model) is entirely separate from performance prediction (via a proprietary attention-based neural network).

AI is taking the centrestage across most business functions including marketing, what are the biggest trends you’d like to comment on as well as biggest safety concerns you feel modern marketers should be looking at when it comes to AI. 

The potential of AI has exploded onto the technology scene and into the world of content Marketers. Companies cannot stand on the sidelines. They must lean into this new Industrial Revolution. However, there are three problems:

1) Access (to the array of new AI models and their potential)

2) Scale (of AI into the operations of a mature Enterprise)

3) Trust (in AI, its outputs, and in the context of pending legislation and rapidly evolving cost models)

Of course, the last point is particularly problematic, which has resulted in many businesses finding themselves in a conundrum where CEO mandates to make progress with AI have been met with security/policy blocks on LLM usage. Companies need to plot a path that balances progress with the evolution of geopolitical legislation and corporate guidelines.

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How would you summarize the state of B2B martech and marketing as of today and what thoughts do you have for the near future – what trends will shape this market?

I think we’re seeing a significant fracture between client disruptors, early adopters and early majority, and late majority/laggards. On the one hand, many businesses have adopted the customer-centric mindset, technology, team design etc.

They are now progressing into automation with AI. Their scale, speed, adaptability, accuracy and competitiveness will increase exponentially. Onm the other hand there are many Enterprises that still focus their efforts on “the weekly email” or traditional website marketing that has evolved little from the dotcom boom. They are still stuck in technological and political status quo. I expect many of these businesses will be squeezed out despite their size and tenure in their respective markets. At some point the lead time to progress to a customer-centric state with AI for automation will be longer than declining revenue can support.

And, of course, the technology industry is accelerating, fuelled by AI and investment in AI, which will force the issue further. In marketing content alone we will see language, imagery and rich media coming together for highly personalized, accurate and compelling content for every individual, produced and optimized at massive scale by machines.

When it comes to B2B tech and the overall SaaS ecosystem, how do you feel marketers and sales teams in this segment can create better end to end journeys and experiences for end users? What are the biggest lags you see in an already-crowded digital market such as this?

Given the nascent, rapidly evolving environment, and constant hype in SaaS (it has always been a “fashion industry”!) it’s all about education, adding value to the client through knowledge and thought leadership, and earning the right to move to more commercial discussions. All too often, B2B SaaS companies are just looking for active projects and short-term revenue. But they can add value right out of the gate by educating, enlightening, and telling the end user something they don’t already know – ideas for improving their business, etc. Better end to end journeys begin by establishing the client/vendor relationship on the correct foundations. Unfortunately, Product Marketing often far exceeds actual Product.

Buyers need to pay attention to how technology is built, which means being willing to learn about fundamental (not complex) considerations of architecture and logic.

We’d love to hear about some of your marketing/sales processes at Phrasee and the martech-salestech that helps drive all of it – what takeaways would you share with our readers? 

We aim to cut through product marketing hype and highlight what makes technology fit for purpose. We start with the building blocks: What are the key considerations when it comes to architecture and logic? Buyers often glaze over this, but that’s a bit like a chef not being interested in ingredients. Understanding the fundamentals is incredibly empowering for the buyer. Our marketing approach is all about encouraging the marketplace and prospective buyers to pay attention to these things in the first place.

If you had to share a few AI trends that will lead the martech and adtech space in 2024 and beyond, what would you talk about? 

Trend 1: MarTech will see investment in workflows. Brands and software vendors will discontinue efforts to build low value veneers on LLMs purely for the sake of Product Marketing. Instead, they’ll invest in building proper software and workflows to deliver value to the client.

Trend 2: AI will enable brands to extend their marketing reach. Brands can’t keep up with the copy needed for true customer-centricity (users of modern Customer Engagement Platforms use an average of 5 channels and sometimes as many as 9). AI will allow brands to utilize those channels to a greater degree and increase the quality of these communications (more accurate, more personalized).

Trend 3: Brands will become multilingual despite the massive content volume requirements of a modern channel-agnostic stack. AI will unlock this most obvious form of personalization – i.e. communicating with the customer wherever they are in their native tongue. So obvious!

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