MarTech interview with Parry Malm, CEO of Phrasee
Hello Parry, tell us about your journey in technology. What prompted you to launch Phrasee?
I like to think I was predestined to build something that combined language and technology: my mother was a language teacher and my father was a physicist turned inventor who brought an AI product to market.
As for Phrasee: the idea arose out of my hundreds of interactions with email marketers when I was working for an ESP. Every time they asked me their # 1 question: “What makes a good subject line?” “- I always said” try a bunch of things and see what works “. It was always like a cop outside. I knew there had to be a better way – a more scientific way – and of course there was.
Of brand-side marketer running an AI company as savvy as Phrasee – what inspired you to take the leap into the industry?
It occurred to me that marketers have traditionally relied on their intuition and instinct to choose the best language to use. The marketing of the future is data driven. Standing out from the crowd and keeping audiences consistently engaged across all channels, while remaining loyal to the brand, can no longer be left to the Don Drapers of the world.
So we decided that the market was ready to adopt cutting edge technology to optimize the language of marketing campaigns.
How does adding an element of AI to your martech platform actually help convince your customers and justify their trust in your platform?
In fact, we’ve always been an AI / MarTech parallel company – putting science behind language has always been our MO, and that science component has always been AI.
Natural Language Generation (NLG) is the AI that generates human language tailored to a brand’s style, tone, target audience, and campaign goals. Deep learning is how we tap into historical data and the results of automated experimentation. All of this translates into more optimized messaging and better marketing performance for our customers. We justify their faith with the numbers we produce!
Can you tell us more about Phrasee’s offerings for the ecommerce industry and the unique features that you currently offer to Martech users in ecommerce?
It sounds fancy (because it is), but the math is straightforward. Your brand, plus Phrasee’s real-time linguistic optimization, equates to increased engagement throughout the customer journey. Phrasee generates a high performing, personalized and relevant brand language for your target audience, in real time and at scale. It helps you get the right message, at the right time, to the right people, with your brand’s unique voice.
What is the Phrasee score? What type of data science engine determines the performance of Phrasee Score?
Phrasee Score confronts the dirty secret of marketing: that no existing individual email KPI is perfect. For example, clicks and opens are often obscured by bots, click fraud, and accidental or random opens. So rather than relying on these isolated metrics, Phrasee Score uses ensemble learning to aggregate multiple data points, producing a score that more accurately and reliably represents the overall impact of your email.
Holiday shopping trends
During the COVID-19 pandemic, we learned how marketing managers led their marketing teams through the accelerated need to shift to digital shopping trends. Have you analyzed this unique trend in digital shopping behaviors that has helped or could help your customers meet today’s retail shopping demands?
Most of the data shows that the majority of shoppers still prefer in-store shopping – even the younger generations – but the mix of physical and digital purchases is accelerating rapidly. It is now necessary to balance continuous digital innovation with a return to physical purchases.
Online marketing has a much greater impact on in-store sales. Therefore, providing in-store experiences that are perfectly suited to the digital world could help you differentiate your brand and retain your customers through a better shopping experience. For example, imagine having a QR code next to the price tag that customers could scan to see reviews on a product before purchasing, or use that same QR code to access stock alerts. This is how retailers should think.
A few weeks away from holiday shopping, what should be the action plan for retailers? How can retailers leverage Phrasee to increase CLTV?
Inboxes are of course overcrowded during peak retail season, so it’s essential that you optimize your brand language enough to stand out. Our analysis of thousands of subject lines from last winter’s peak retail sales revealed that clear, concise, and direct language tended to work best. Empathy and sensitivity were also essential, as were emojis. That said, every brand is unique – the most important thing is taking what makes your business special and optimizing the way you communicate it to your customers. Phrasee does this by distilling your brand’s style, tone, target audience, and campaign goals, and generating optimized language that you can tailor to your communication channels for maximum engagement.
AIOps, IT, Security and DevOps in Martech
Are you highly regarded as an AI SaaS company for digital advertising and AI fields? Can you tell us how these two distinguished technology areas really converge at Phrasee? We’re very curious to learn more about the AI Lab and how it works with Phrasee’s broader product development and marketing team.
The process we go through with each client combines the power of AI with great digital marketing. First, we build a language model to suit a brand’s style, tone, target audience, and campaign goals. Phrasee can then produce coherent, natural and scandal-proof language in real time with a single click. Deep learning is how we then leverage historical data and the results of automated experimentation so that Phrasee always learns from past performance and improves with every send.
Hear it from the AI pro: Do you agree that data privacy is a major concern for marketers? Tell us how the AI-powered metric could help email marketers overcome the challenges of Apple’s upcoming message privacy protection feature.
Yes, data privacy concerns introduce new restrictions (and statistical noise) for email marketers – but unlike some headlines, the sky isn’t falling on us. Nothing has fundamentally changed about what makes an email work: you still need a killer subject line, a clear list, a good layout, a compelling offer, strong CTAs. What has changed is that we all need to get smarter about the way we track and optimize email performance.
That’s why we created Phrasee Score – it solves the problem of noisy KPIs by combining information from multiple sources to give our clients a single weighted score they can trust. This is how we equalize the extra noise introduced by Mail Privacy Protection.
IT support and service customization are critical to the adoption of any new technology, especially if it means catering to an industry as large as e-commerce and digital advertising. What type of IT support do you offer to customers to ensure a better customer experience (CX) and better security on your platforms?
Very little IT customization is required to implement Phrasee – we have plugins out of the box with all major marketing automation and CX systems, from Salesforce to Adobe.
Parry, here is my favorite part of the interview: Tell us about your AI ethics policy. Do you think every CEO of a global tech company should have a very clear AI ethics policy?
We have always believed that AI should be used for good. Since we founded Phrasee in 2015, our focus on ethics has remained unwavering. Our AI ethics policy was one of the first of its kind, but it is also an evolving document as the world does not stand still. It is important that our ethics policy is practical, specific and explicit. It is accessible to the public on our website and covers everything from not using data to target vulnerable populations to willingness to take action to avoid prejudice and prejudice, and always being open about what our AI is doing.
As for my take on other CEOs and how they should act, I think it would be grandiose for me to say what I think my peers should be doing. What I can say is that for Phrasee our AI ethics policy has had a huge impact, both from a business standpoint and from a cultural standpoint. Our team have all read and know the policy, and trust our goal as a company to adhere to it.
Tips or advice for young professionals who wish to join or already work in the Martech or AI Data Science industries in the coming months:
Don’t focus on the industry, focus on the people you work with and the culture you enter. There are many ways you can make money these days, so why not do it with cool people while having fun?
Your plans for the next holiday shopping season:
Buy as little as possible, because I’m not great at material things. Although I can give my sons remote control cars.
What are you currently reading / which book would you recommend to our readers:
The best business book I have ever read is hundreds of years old. It’s about scarcity and how scarcity causes humans to behave in interesting ways. It’s called Candide, by Voltaire – and I would recommend it as required reading for anyone in the business world, or for that matter, the world.
Which webinars / podcasts have you subscribed to: how do these help you stay on top of your goals?
I am not a heavy consumer of business-oriented media. The only podcast I listen to regularly is Business Wars, a podcast by Wondery, which pits two all-time competitors in a market area and describes the story of their competitive struggles. My favorite miniseries was from Monday Night Wars – WWE vs WCW wrestling. Highly recommend!
Thank you Parry for answering all of our questions!
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