 Hey, welcome back everybody. Jeff Frick here with theCUBE. We're having a CUBE conversation in our Palo Alto studio. The conference season's taken a little bit of a break so now we can do interviews in the studio which is a little bit more comfortable situation and we're really excited to have first-time guest, Karen Steele. She's the GVP of corporate marketing at Marketo. Karen, welcome. Thank you. Very happy to be here, Jeff. Absolutely. So you are talking about something that I've seen in the research giving up to this about engagement and everybody talks about engagement. What is engagement? People are trying to measure engagement but then it seems like so many people are still stuck though on the mass, broadcasting kind of numbers. They want big numbers which is a very different number than engagement. So you guys are getting really into this, obviously Marketo, a leader in marketing innovation and marketing platform. Is this new? Is it renewed focus? I mean, how do you guys deal with this whole concept of engagement? Yeah, so thanks, it's a great opening question because we are passionate about engagement and in fact we believe that today people, human beings want to be engaged with as opposed to marketed to. So our CEO created a vision of this idea called the engagement economy. And the idea is that everybody and everyone is connected. Today with the digital transformation happening around us, you can touch people, touch customers anywhere and everywhere throughout their journey. Before they buy from you, during the sales process and post sales. So it's all about creating an experience and we think the way to do that is through engagement. But it's kind of interesting because the dichotomy is we're in this Google world, right? And the Google world is, you know, build great engineering, people will come. It's all about the data, it's cookies and where have you been and, you know, recommendation engines and more this kind of feels more machine-y, not necessarily engaging, which is more of a person-to-person than necessarily a machine-to-person. Correct. But yet even the person-to-person is still supported by and enabled by a lot of this technology. So this intertwining of both kind of a person to machine or machine-to-person, excuse me, versus really connecting with it, whether it be the brand, whether it be a person that represents the brand. So how do you see this kind of evolving and how can people not get too wrapped up in the machine-y part and actually build a relationship, another word, instead of engagement, with their customers or even take it another step, really their constituents, if you will. Yes. Their community, even more passionate. Yes, yeah, so I think it's interesting you brought up the machine aspect because there's sort of a positive and negative. So if you think about the spaceware and it's called marketing automation and it does feel sort of process oriented and machine-like, but at the end of the day, marketing has always been about the human being and building that relationship. And technology has simply helped facilitate that and do it through multiple channels like never before, but it still comes down to the marketer's primary role is to connect with in a personalized way, in an authentic way and create a relationship, a relationship that's going to generate advocacy for the brand that's going to ultimately generate revenue for their business. So it's really important that engagement is about the human being and it's about how you can create positive experience throughout the life cycle of the journey. Right, it's interesting you say experiences too because we've seen a huge shift in two customers wanting really more of an experience or an engagement that's potentially tied to a brand, but you look at great experience marketers like Red Bull to pull one out, that buying and drinking a Red Bull, the way they've positioned that in the marketplace is really being part of this really cool thing that's visually stimulating. It's a lot of adrenaline and a lot of cool stuff. And then the other one I always think of is Harley-Davidson and the passion that that community has around that motorcycle but it's so much more than driving that motorcycle. It's the open road and it's all the accessories and stuff that they put, but people brand it on their arm, a lot of people. So in terms of how does that translate with newer brands, how do you try to get that type of connection with your customers, hold it. And I think you've mentioned in some of the things I looked up for the interview, really thinking about the lifetime value of the customer as opposed to a transactional relationship that's a one-time shot. Yeah, I mean a lot of the examples you just gave are very experiential in terms of the physical aspects of seeing and feeling and touching a brand, but a lot of digital marketing is not physical. And so you're communicating with people through a lot of channels that are bits and bytes and they're not looking somebody in the eye. And so I think being in touch with your brand and the messages you wanna deliver, making sure they're relevant and they carry your brand promise forward and they connect with what that person wants to hear at exactly the right time. So for us, engagement is about being smart in terms of reaching the person if I use a social or excuse me, a mobile device and that's my preferred way of communicating with you. I want you to reach me through that device and not try and get me through direct mail or an email campaign. I might not pay attention to any of those things. So having that intelligence about your customer or your prospect or your partner or even your employee is gonna give you a better option to engage with them and create that one to one while you're still marketing one to many in terms of the actual relationship. The other challenge a marketer obviously has too I don't know who said it, you did too many shows but when it's done well, when suggestive selling is done well and recommendation engines are working well, it's magical, right? It's what I want when I want and it's presented to me. If it's done poorly, it's creepy, right? I don't necessarily know that you wanna know that that was what I was looking at and obviously did the target example which now is way far in the rear view mirror but just because you have all the data doesn't mean you can use all the data and the challenge and the nuance of knowing what to use when and where and now you have so much more kind of ammunition in your quiver if you will is a whole different type of a challenge. Yeah, I think it's a good point. I think you're right, you don't want it to feel like big brother and somebody's following or stalking you, that's the last thing you want but I think paying attention to the response, paying attention to a personalized message, testing that message, seeing what comes back and helping execute the next thing that you do and so there's sort of a fine line but I definitely think the marketers that are using analytics today and it's just getting smarter and smarter and we're gonna talk about adaptive coming up here, I hope and the big buzz right now which is AI, what does AI mean for engagement and we have some ideas around that as well. Okay, so you broke it down to the big threes of the engagement economy so the art of storytelling, adaptive engagement as you just mentioned in advocacy which you talked about early before so let's kind of touch base on each one of those things. How do you define them, why are they important so we'll start with the storytelling. Yeah, so it comes back to what we've already been talking about which is the one-to-one relationship, understanding who you're talking to, crafting a message that resonates, having that message be front and central to what your brand value is. We are more prone to buy from somebody if we value their brand. You might make choices and pay a price premium if you care about a brand or how a brand interacts with you so crafting the art of storytelling is the right message, making sure it resonates, understanding your audience and connecting it to the brand so you can make that emotional connection. So done well, you can do a very good job. Right, and it's always interesting to me I always think watch sports on TV, right? I always think of the poor guy that just got assigned, I gotta do a car commercial. How many car commercials have been created up till now and I gotta think of a new one. But traditional high-end TV broadcast commercials are really storytelling. Some of them are fascinating what they can actually convey in a 30 second ad or whether it's a coat commercial and it makes you cry at the end. So that in that format has pretty well developed but how are you seeing it translated into all these various digital formats and really short engagements or it's a Snapchat or it's a quick hit on Instagram or it's a Facebook post. How are you seeing some of that storytelling evolve into these different kind of communication mediums if you will and you have so many that you have to manage, right? Huge challenge. Yeah, and again, I think it's the authenticity as I said but also the personalized nature of it. I wanna deliver a message that matters to you where you wanna receive that message. I might wanna deliver something different to somebody else through an entirely different channel. So but crafting the story, having the story be based on what you stand for as a brand and the value for that customer or whoever the message is you're attempting to land it on is still foundational and fundamental. And I think that a lot of the marketing because technology's automated so much we've lost a little bit of the art of the story and really making the story connect back to you as a brand so that you deliver the best message to your customer. That kind of feeds into your cycle in which you described as adaptive engagement which I presume was situational, contextual. Correct. That's defines the how, the when, the where. Yeah, yeah and I think in terms of our vision so yes, it is about delivering the right message at the right time to the right person to get the response you want. That's sort of the basics of adaptive and being able to do that very flexibly with technology. But when we think about adaptive in the next generation of it we think about the impact that AI will have on engagement or marketing. So imagine a marketer today could say to their engagement platform, let's say the Marketo engagement platform, I wanna understand an outcome and the best way to go about it. I wanna know how I can increase sales in a particular region in a particular quarter. And the engagement platform based on that outcome that I want will help determine what the right campaign is, what creative elements you put in that campaign based on the assets you've created and importantly who you target and what is the audience and think of almost just creating that outcome, having the platform deliver that whole experience when you push a button and that entire campaign gets executed. So that I think is the future of adaptive. Because you'll be able to run AB test is probably not a very accurate description, because it's a much more multivariate test that you can run and really start to optimize for a much tighter group of attributes of your customer than you ever could in the past. You try to think of every kind of variable. And we do that today, but I think now what we're saying is the marketer is gonna truly be in the power seat where they can say, not just here's two ideas test one against the other, it's basically here's the outcome I want, tell me exactly the best way to put that message out, what channel it should go through, who it should be delivered to and run it. And so I think that's gonna be the future of adaptive. Interesting. And then the third A that you have of engagement economy is advocacy. Heart and soul of any brand strategy. You know, customers, loyal customers are great customers and you want to create advocacy in relationships. I think when companies talk about advocacy, they talk about I want a customer reference. I want somebody who's gonna approve a customer story or a quote in a press release. We go far beyond that when we think about advocacy. We want customers that are going to partner with other customers and make the community around us better. And so they're speaking on behalf of our brand Marketo, but they're also making our brand stronger in the relationships they're creating around Marketo. So we have a program called Purple Select, which has about 1200 customers that every single day, we're putting challenges forward for them. We're offering them places to go, generate conversations in community. And as a result, they give stuff back to us and they make things available to us that otherwise it wouldn't be. It's really kind of analogous to open source, right? The fact that, you know, all the smartest people in the world don't happen to reside in your four walls. And you know, if you can use your product service, offering, platform, store as a basis point for an engaged community to engage around through with. Correct. You get, you know, one plus one makes three or 10 for that. So huge, huge kind of shift in thinking to really kind of open it up and to share and be collaborative and find out what other people are doing. And I think that's a great point. And let the advocates be your heroes. Let them advance their careers based on learning your technology, participating in your community and taking, you know, their businesses forward in terms of success from a marketing standpoint. So I'm just curious in terms of the holy grail of measuring engagement, you know, kind of your thoughts on that. I mean, there are obviously engagement measures out there. Right. How do you, you know, what are some of the things you look at to measure engagement or you tell people they should look at to measure engagement? And how do you see engagement as a metric, as an actionable metric kind of evolving now that we have so many more potential touch points, data points, other ways to measure? Yeah, so I think in the traditional marketing automation world, which we have played a big part in over the years, the true measurement has always been about pipeline because you're doing campaigns to generate revenue for your business. I don't think that goes away, but it gets extended to across the entire life cycle. So it's not just new customer acquisition, it's upsell, it's cross-sell, it's renewals if you're in a software as a service business. So it's lifetime value, not just revenue. Right, right. It's advocacy, not just references. It's, you know, peer to peer. There's this whole idea of voice of the customer. There are new companies out there like Trust Radius and G2 Crowd, which provide platforms now for customers to do reviews on products and rank companies and making that available to users gives everybody a voice in the process. So there's a whole bunch of new metrics. Many of them are going to be, you know, very, very much around emotional connections back to your brand and participation in the community. Today we have the Marketing Nation, which is a 60,000 person community. The way I can cultivate content on that and grow people's roles in participating in that dialogue is certainly an engagement measure for us and it will lead to stronger sales. It will lead to stronger, you know, preference in terms of our brand. It will lead to premium pricing if we want to do that in the future, et cetera. Right. And then I wonder too if you could just speak the evolving role of marketing. Not only within the company, but specifically within IT spend and business analytics spend and really as a driver. Because before the analytics was really a service provider to the rest of the company and we gave you your quarterly's and your weekly sales reports and, you know, that was kind of the role of IT. Now we're seeing IT as a business partner stepping in to say here's all these cool technologies but now marketing and the marketing automation, which is way ahead of the automation. And a lot of the other places is really driving that and you've got measure results and you can connect all the different channels that are new that weren't there two years ago when you just had newspaper and billboards and TV. So, you know, as that has evolved, how have you seen marketing's role change in terms of kind of power seated at the table, driving IT investment decisions and those types of things. Obviously, Marketo's one of those decisions for a lot of companies. Yeah, and it's a great conversation because there's been a lot of talk about the hybrid CMO and what does that look like today because the CIO and the CMO now have to be in lockstep and many cases now the CMO's technology budget is looking as large as the CIO's technology budget. And so, and then there's this other notion of if marketing owns the customer experience or all things around customer engagement, are they not in fact the chief customer officer? And so, there's a whole bunch of things that I think are crossing lines but I think it's great news for the marketer because they need to be more customer centric, they need to be more data centric and ultimately they sit in a really pivotal place in the organization to achieve many of those things. Right, and it's still interesting and for all the soft things, I'll call it a soft thing of engagement and lifetime value and some of these things that aren't necessarily tied to the bottom line at the end of the quarter, every quarter, we still have to respond to that and at the end of the day there has to be some tie, some connection, some demonstrated value of these efforts. It can't just be for apple pie and lemonade, I forget the expression, but anyway. So, because it still has to tie back to business, right? Still has to pay the bills, it still has to get more sales. But what you're saying is it does. Engagement does translate to sales. Engagement translates to sales. Engagement translates to brand preference. Engagement translates to price premium. Engagement translates to advocacy. I mean, engagement is, it's such an active way to move the market forward that I think there's going to be a whole set of new metrics that combine sales enablement and sales processes as well because as marketing and sales partner, from a sales engagement standpoint to go after named accounts, the ones that are most strategic to the business, we're going to see a huge shift in terms of sales engagement metrics as well. Just as you're saying that, I'm thinking of brands, right? There's always a debate about the power of brand and does brand still have power? And I think it does, but the market's really kind of bifurcated where either the brand is super powerful or has zero power, you know, kind of depending on the product or the engagement. And it sounds like really, engagement is probably the best way to make sure your brand can't be replaced by the old white label stuff that they used to have at the grocery store. Because people got to be connected, not just the label. And they need to care about, people need to ultimately care about the relationship, not the one thing. I, you know, it used to be you dropped a direct mail. It was sort of an episode and you were never having a dialogue. Today, there's so many ways and so many channels to reach people. You have to have a consistent way to engage and a consistent way to look at, did I move the needle forward? Am I ultimately renewing that customer or generating more loyalty from that customer or, you know, reference ability or advocacy? And so engagement helps you do that through all the channels. It's interesting because the customer can engage with you whether you, or communicate with you whether you necessarily want it or not in new ways that were here before not existent. That's right. Fun stuff, great place to be. Well, Karen loved sitting down and talking about engagement. It's a thing we talk about here all the time. Great. It's really how we should measure success. That's how we know we're getting through and look forward to follow up and we have some research coming out and some books coming out and Marketo's up to all kinds of stuff. So we will look for that in the not-so-distant future. Awesome. Thank you. We look forward to it. Absolutely. She's Karen Steele from Marketo. I'm Jeff Frick. You're watching theCUBE. Thanks for watching. We'll see you next time.