 Live from Las Vegas, Nevada, it's theCUBE. Covering IBM World of Watson 2016. Brought to you by IBM. Now, here are your hosts, John Furrier and Dave Vellante. Hey, welcome back everyone. We are here live at the Mandalay Bay at the IBM World of Watson. This is SiliconANGLES Cube, our flagship program. We go out to the events and extract the signal from the noise. I'm John Furrier with my co-host Dave Vellante for the two days of wall-to-wall coverage. Our next guest is Michelle Poulouseau, who's the chief marketing officer for IBM. New the company, fairly new within the past year. Welcome to theCUBE. Past month. Past month. I can't keep track of all these new hires. A lot of new blood coming into IBM, but this is a theme we heard from Staples. To be agile, to be fast, you're new. What's your impressions and what's your mandate for the brand? I mean, IBM's strong brand, but what's the future? Look, look, I'm thrilled to be here and I'm thrilled to be here because this is an extraordinary company that makes real difference in the world, right? And that, I think, you feel it here, the world of Watson and the sort of everyday ways that Watson and IBM, such as consumers, such as end-users, makes their health better, allows them to have greater experiences. So that's an incredible new part of an iconic company. Having said that, and exactly to your point, it's a time of acceleration and change for everyone and IBM is not immune to that. And so my mandate here and my remit here and coming in and being a huge fan of what IBM has to say, well, how do we sharpen our messaging? How do we almost feel like a challenger brand? How do we think about what Watson can do for people? What the cloud can do? What our services business can do? And how is that distinctive and differentiated from everybody else out there? And I think we have an incredible amount of assets to play with. That's got to be through the line. It's no longer the case that we can have a message on TV and that attracts the world. The digital experiences are having every single day. When they're clicking through on an ad, when they're chatting with somebody, when they're calling our call center, when they have a sales interaction, is that differentiated messaging and that brand resident all the way through. Second thing is marketing's become much more of a science. And that to me is super exciting. I've been a CEO most of my career and the notion that marketing has to drive revenue, that marketing has to drive retention and loyalty and expansion. That we can come to the table with much more science in terms of what things are most effective in making sure that more clients love us more deeply for longer. I'm going to ask you the question because we've had many conversations with Kevin Egan who was just here, he was on last year. Bob Lord, the new Chief Digital Officer on him. We talked to your customers. Kind of the proof points in today's market is about transparency. And if you're not a digital company, how could you expect customers to work with you? Of course, of course. So this has been a big theme for IBM. You guys are hyper focused on being a digital company. Yes, yes. And how does that affect the brand? The brand contract with the users. What's your thoughts on that? Well, first of all, Bob Lord is awesome. We've known each other for 10 years. So it's so wonderful to be working with him again and Dave Kenny as well. I think that at the end of the day, consumers have experiences and, you know, think of every business unit out there as a consumer. And they're having experiences all the time. Their expectations are being shaped by the fact that they can go on Amazon and get Prime delivery, right? Their expectations are being shaped by, they can go on Netflix and get, you know, personalized recommendations for them or Spotify. And so our job, of course, we have some of the greatest technical minds in the world is to make sure that every experience lines up with the highest of their expectations. And so much of that is digital. And so my passion, my background is entirely of the digital space. I have a CEO of Travelocity and then CEO of GILT, Chief Marketing and Digital Officer at Citigroup. So the notion that, you know, the world's greatest digital experiences is something I'm very passionate about. So you mentioned, Michelle, the sort of big TV ads. And you think of the smarter planet, which was so effective, but it was this big TV campaign. So what's the sort of strategy that you're envisioning? Is it sort of digital breadcrumbs? Maybe you could talk about that a little bit. Yeah, well think about Watson. It's a perfect place to think about the Watson branding. What does Watson really mean, right? Watson is, and Ginny has said this so well, of course it's cognitive and cloud, but at the end of the day, it's about helping people make better decisions. And so you can do some advertising with Watson and Bob Dylan and Watson and, you know, the young girl in Serena. And you can get that messaging high, but then you've got to bring it all the way through. So that's why something like this is so powerful to see Woodside up there, Oli, or all these companies talking about Staples, how they are using Watson embedded in their processes, their tools to make their end users' experiences better and how nobody else could do this for them, the way Watson's doing it. That's taking a brand on high and advertising message on high and delivering value for businesses, for patients, for consumers all the way through. That's what we have to do. I got to ask you about that ad advertising trends. Obviously we all see ad blocker in the news, digital is a completely different new infrastructure kind of dynamic with social and whatnot. You know, talk about, Bob and I were talking last night about it too, you know banner ads are all out there, impression based and then coded URLs to a landing page, email marketing. Not going to go away anytime soon, but it's changing rapidly where you have now new channels. Yeah. Because this is now a new kind of ROI equation. Is there any thoughts on how you look at that and is it going to integrate into the top level campaigns? How are you looking at the new digital, the cutting edge digital stuff? I have huge amounts of thoughts on this topic. We do too. Incredibly passionate about this topic. So I think, you know, if you think back 15, 20 years ago there were always something called market mix modeling which helps advertisers and marketers to understand the effectiveness of their TV campaigns. And quickly, not too dissimilar from Nielsen, you know, there was art and science at best in it. And then all of a sudden the digital world evolved and you could get at a tactical level very, very clear about attribution and whether you drove something. The challenge for us now is much more sophisticated models that are multi-touch attribution because the reality is an average consumer doesn't do one thing or have one interaction with a brand. They're going to see a TV show and watch a commercial while they're watching that commercial that business user or that end consumer is on their iPad or on their phone. They're seeing a digital ad the next day at work or being retargeted because they were at some company. They searched for something, they see a search campaign. Our job is to connect those dots and understand what really moved that consumer, that business user to take an action. And there are many sophisticated multi-touch attribution models where you model a standard set of behaviors and you test correlations against a bunch of different behaviors so you understand of what I did of all the money I spent, what really drove impact. And by cohort, I think that's the other, there's no more of the sense of sort of aggregated everything. You really have to break it out by audience-based by cohort to see what moves the needle. And improve that experience, right? Which has been mixed. Of course. You gave the example the other day of the Hilton. The retarget is hard. You already know that the hotel was full. So obviously Watson plays a role in that. Absolutely. Data plays a role in that. It's all about data. It's all about, you know, that's where I think Watson can be extraordinarily helpful. So if you think about the tools a marketer has, they're becoming more and more sophisticated and retargeting with something I don't know, 10 years ago, whenever it was introduced, that helped all of us a little bit in getting that message. But it is only as good as the API's behind it and the experience behind it when, now when I was a guilt, I was CEO of guilt, we would put over a thousand products on sale every day that would be sold out by the next day. Sales down is 24 hour flash sale. We had to get really, really good at knowing how to, how to retarget because last thing you want is to retarget something that's sold out, right? Or go on the next day. And understand the user that was in and out and they're coming back and understanding that cohort. But that's where Watson to me is very exciting. And you probably saw this in some of the demos of where Watson can help marketers. You know, where Watson can really understand what are the drivers of behavior and what is likely to drive the highest propensity action. Why were you so successful at guilt and how are the challenges different here? Is it because there's a sort of relatively more narrow community or maybe? I did this at Citigroup too. So I was global chief marketing and digital officer at Citigroup and a tremendous budget and in a lot of transactions you have to drive every day. A lot of people you want to open credit cards and bank accounts and so around the world. I think that the relentless focus on marketing being art and science, art and science. And I think that's that passion for analytics, passion for measurement, having been a CEO, that passion for being able to say, this is what we're doing and this is what we're driving. It's critical. So you've been kind of a data geek in your career. You mentioned the financial services. You have to measure everything. Back to the ad question. You know, the old saying used to be, I'm wasting half my advertiser. I just don't know which half. Yeah, right. I think my advertiser is wasted. But now for the first time in the history of business in the modern era, you can measure everything online. That's right. So does that change your view and the prism of how you look at the business because you mentioned multi-touch? Yeah. So now does that change the accountability for the suppliers? I mean, ad agencies doing the big campaign. Well, it's working. Trust me. Of course. Look, I think it changes the game for all of us and there's no destination. This is every day you can get better at optimizing your budget. And I would be the first to tell you as much of a sort of engineering and data geek as I've always been and take pride in. The reality is there is art even in those attribution models. What look-back windows you choose, et cetera. You know, you're making decisions as a company. But once you make those decisions, you can start arraying all of your campaigns and saying, what really moved the needle? What was the most effective? That's not an indictment. That's say, what are we going to do differently tomorrow? You know, the best marketers are always optimizing. They're always figuring out at what point in the final can we get better tomorrow? I want to ask you about talent because that's one of the things we always talk about and also get your thoughts on women in technology, steam. We were just at Grace Hopper last week and we started a fellowship called The Tech Truth and we're doing this real passionary for us. We have a site at cube365.net slash women in tech. All women interviews, we're really trying to get the word out. But this is now a big issue because now it's not STEM anymore. It's steam, arts is in there. And we were also talking about the virtual reality, augmented reality user experience is now potentially going to come into the immersion experience. And there's not enough artists. So you start to see a combination of new discipline talents that are needed in the professions, as well as the role of women in technology. Your thoughts on that, because you've been very successful. What's your view on that? What's your thoughts? First of all, thank you for what you're doing, right? It takes a lot of people up there saying that this is important to make a difference. So most of all, thank you. You know, I think that this is obviously a place I've been passionate about forever. I remember being a CEO and being pregnant and that becoming this huge issue in news story and you're trying to juggle it, right? And how could a woman's CEO be pregnant? So this is something. Oh my God, you're getting tragedy. I mean, come on, it's so funny how people are ridiculous. But it was kind of a first at the time, you know? And so it was, it took attention. But I think that the point is that the advantages a company has when there are great women in engineering and great women in data science and great women in user experience and design are just palpable. They're palpable in a variety of ways, right? One, the team thinks differently. The team is more creative. The team is more open to new ideas. The output for the customers are better, right? I mean, we just saw Snapchat today just announced that in 2013, 70% of their users were women. So all the early adopters were women. You know, now it's balanced, but the early crowd were women. And so we have got to figure out how to break some of the divides. Now I'm incredibly encouraged though, while we still have a long way to go, the numbers would suggest that we're having the conversation more and more. And women are starting to see other women like them that they want to be like. It's a global narrative, which is again, why we're putting some journalists on there and funding it as a fellowship because it's a global story, okay? And the power women. I mean, it's like there are real cloders and this real talent coming in. And the big theme that came out of that was, is that 50% of the consumers of product are women. So therefore they should have some women features and related some vibe in there, not just a male software-driven concept. Well, and should too, when a powerful individual, male individual like Satya steps in it and understands what the mistake is, and someone like Fanny. You were referring to his speech two years ago at Facebook. Where he said that you should just, just bad karma, don't speak up, and women were like, no way. And then Benioff this year saying, okay, opening up transparency. He got some heat for that talk, as you probably know, but in my opinion, it's a positive step when an individual like that is powerful and opening transparency within their company. You know, that's a step in the right direction. Well look, I think a lot of it is that great networking. I host a, I've been doing this for years and years with a good friend of mine, Susan Lyne from AOL. We host a quarterly breakfast for women in tech every quarter of New York City. And we've been doing it for a long time. It's amazing when those women come together, the conversations we have, the discussions we have, I had to help each other and support each other. And so that's a real passion of mine too. I was in Boston a few weeks ago for the Data Science Summit, which Bob Pucciano was hosting in, and one of the folks was hosting the Data Divas breakfast. And we had a couple of data dunes who walked in, and it was interesting. The perspective is 25% of the women, or the chief data officers were women, which was an interesting discussion as well. So maybe it's a good thing. Well I was in one of 1,000 men at 15,000 women around me, there's no line for the men's room. The women's line risk. You know as you see that tech, no, but it's certainly changing. I want to get back to the mentoring thing, because one of the things that we're also passionate about is you've been a pioneer. So now there's now an onboarding of new talent, new personas, new professions are being developed because we're seeing a new type of developer, we're seeing new types of, I would say artists becoming either CG. So there's new tech careers that weren't around, and a lot of the new jobs that are going to be coming online haven't even been invented yet. So you see cognition, and what cognitive is enabling, is a new application of skills. Can you just thoughts on that? Because this is an onboarding opportunity, so this could change the number percentage of women in diversity. When you think about what, I mean it's clear your notion of steam, right? Your notion of STEM, that is a male and female phenomenon. That is what this country needs, it's what this world needs more of, and so there's a policy and education obligation that all of us have to the next generation to say, let's make sure we're doing right by them in terms of education and job opportunities. When you think about onboarding, I mean to me the biggest thing about onboarding is, the world is so much more interconnected than it used to be. If you're a marketer, it's not just art or science, you have to do both. It's that right brain, left brain connectivity, and I think 10, 20 years ago, you grew up in a discipline that was functional and maybe siloed, and maybe you were great at left brain or great at right brain, and the world demands so much more, it's a faster pace, it's an accelerated pace, and the interconnection is critical. And IBM, one of the things we're doing is we're putting together these diamond teams, and I think it's going to really help lead the industry. Diamond teams are what you have on every small agile marketing team, an analytics head, a product marketing head, a portfolio marketing head, a designer, a social expert, these small pods that work on campaigns, gone are the days that you could say, designer designs it, product comes up with a concept, then it goes to a design team, then it goes to a production team, then it goes to an analytics team. We're forcing this issue by putting these teams together and saying you work together every day. You'll get a good sense of where the specialty is and how you learn how to make your own discipline better because you've got the analytics first and sitting next to you. I want to ask you a question about media buying and media planning, advertising, as we're seeing this new real time web world, mobile world go out, the old days of plan, media buys, place the advertisement was a pacing item for execution. Now things, you mentioned in the guild, flash sales. So now you're seeing new flash opportunities to glob onto an opportunity, could be engagement, and create a campaign on the fly. Is that a vision of you guys? I mean, do you see that? And does it change the cadence of how you guys do your execution? Of course, of course. And that's one of the reasons we're moving to this diamond team in Agile. I think Agile will ultimately be as impactful to marketing as it was to engineering and development. And so I think the, of course, that has to start with great modeling and great attribution because you have to know where things are performing so that you can iterate all the time. I mean, I believe in a world where you don't have marketing budgets. And I know that sounds insane, but I believe in a world where you set target ranges on what you think you're going to spend at the beginning of the year. And every week, like an accordion, you're optimizing spend based on campaign effectiveness. Shipping marketing. You're shipping marketing like code. So much of marketing is just episodic. Boom, and then it dies. And then boom, and it's on to the next one. And you're talking about something that's... Agile marketing. I love that. And then the personas, to your point, are much more fluid as well. You got millennials just creating their own vocations. Yes, well, and this is where I think consumer companies have led the path. And when you think about a lot of B2B companies, we've had this aggregated CIO type buyer. And now we've got to get much more sophisticated about what does the developer want? What's important to the developer? The messaging, the tools, the capabilities, the user experience? What about the marketer? What about the person in financial services? And so both industry and professional disciplines are sophisticated. And you have the tooling now with Watson. You don't have to guess what they want. You can actually just ask them. Yeah, well, the huge advantage. You can actually observe the observation space is now addressable. Right, and that's... What are they clicking at? What are they reading? What are they doing when they're here at World of Watson? And that's super important. Even the stereotype of the persona is changing. You've been saying all week that the developer is increasingly becoming business oriented. Maybe they don't want to go back and get their MBA, but they want to learn about CapEx versus OpEx, and that's relevant to them. And they have fast learners. But they're revolutionaries. The best developers are revolutionaries. And to be a revolutionary, you have to understand the impact, right? And they want to ship code. They want to change the world. I mean, that is every engineering team I've ever worked with, and I've only worked with, I mean, I've been as close to engineering as it is from day one of the internet, or early on in the internet. Great engineers are revolutionaries. They want to change the world. And to change the world, they want to have a broader and broader understanding of what levers are at their disposal. And I will say that, and I am, one of the reasons I came to IBM is I am passionate about this point. Technology cannot be, in the hands of a few companies on the West Coast who are trying to control and dominate the experience, technology has to exist for all those amazing developers everywhere in the world who will make a difference to end users. Well, this is IBM's strategy. You actually have a big presence on the West Coast, also in Germany. So you guys are going to where the action centers are, but not trying to just be Silicon Valley. No, but my point is what, exactly. Because my point is IBM has always been there for making businesses stronger and better. We don't monetize their data. That's not our thing. Our thing is to use our cloud, our cognitive capabilities in Watson to make actual businesses better. So that ultimately, consumers have better healthcare and better results. I know you're new on the job, so this is not a trick question. Just kind of a more conversational. As you talk to Bob Lord, Bob Puccino, Ginny, what's the promise of the brand? And it used to be back in the days when Bob Puccino was talking about when we, I worked at IBM in the 80s, co-op student, and it was, you'll never get fired for buying IBM. It was the old mainframe kind of concept. But it's evolved, and obviously we see a smarter plan. What's the brand promise now? What are you guys talking about? What's the brainstorming? I put that on a TED. I think the greatest innovators of the world, the most passionate business leaders of tomorrow, come to IBM to make the world better. And I believe this is a brand for the forward lookers, the risk takers, the makers. I think that you come to IBM because there's extraordinary assets and industry knowledge, real humans, real relationships in that. We exist to make your business better. Our business will be a byproduct. We exist to make your business better. That has always been where IBM has been strong. You know what's interesting? That brings up a good point. We're just riffing on that. Dave and I were just observing at the Grace Hopper with our Tech Truth Fellowship, which is promoting the intersection of technology and social justice. You're seeing that mission of technology, business value, and social justice as an integral part of strategies. Because now the consumer access, the consumerization of business, software-based, is now part of that feedback. You're not doing good. Millennials demand it. I mean, millennials now, when you look at the research and the next generation behind millennials, are very, very, they want to know what are you doing for the world? I mean, who could do a 60-minute show besides IBM? Who could be on 60 Minutes changing cancer? Changing cancer outcomes for people beside IBM. That is an extraordinary testament to what the brand is and how it comes to life every day. And that's important for millennials. We had Mary Glacklin on yesterday. She is so impressive. We were talking about how these Ozone layers getting smaller, these are problems that can be solved. They have to be solved. So the climate change can be solved. So the whole getting the data, and she's got the company, so she's got a view on that, is interesting. Her point is, if we know what the problems are, we as a community global society could actually solve them. Completely. And the more we make this apolitical and we say, here is a problem and we have the data and we have the tools and we have the people and capabilities to solve it, that is where IBM stands tallest. So I think with Watson, you've focused on some big hairy problems to start with and now you're knocking off some of them. You know, maybe more mundane, but obviously significant to a marketer. It's been incredible that a company can start with the hardest, most complicated problems the world has and actually make a difference. My final question, when I asked Mary this yesterday and she kind of talked about if she could have the magic Watson algorithm to just do something magical for her, what would it be? And she said, send Watson to the archives of all the weather data going back to World War II, just compile it all and bring it back to her addressability. So the question is, if you could have a magic Watson algorithm for your chief marketing officer job, what would you assign it to do? Like what would it be? It's like first task. Well, first of all, my initial reaction, of course I'm a mom of a six year old and eight year old and so I want Watson to optimize my time. For instance, DMO, exactly. That's my problem. Yeah, exactly. 30 seconds less brushing your teeth, it's going to be okay. 30 more seconds with the kids. No, but as a chief marketing officer, I mean I think it really does go back to getting Watson's help and understanding how we use a dollar better, how we use a dollar smarter, how we affect more customers and connect with more customers and the way we communicate, the way we engage, the way we put our programs out, that would be extraordinary and that's possible. That's becoming more and more possible. Bringing science into the art of marketing I think will have great impact on what we're doing and also just the world. I mean, nobody wants to have, be retargeted 10 times for something that's sold out. Well, we have a little more time here so I got some more questions because since we're not getting the hook yet. I got to ask you, so you mentioned travel loss, so you know the web, you've been through the web 1.0, 2.0 and so on. So URLs and managing URLs was a great tracking mechanism from the old impressions weren't working, go to call to action, get the hook right there. But now that world has kind of like become critical infrastructure for managing technology since you're kind of geeking out with us here. What's your view of the API economy? Because now apps don't use URLs, they use tokens, they use APIs, they use push notification based stuff. How does APIs change the marketing opportunity? It changes both, right? It clearly changes the engineering environment and sort of opens up the world of possibilities in terms of who you partner with and how, et cetera. And I think it changes the marketing world too, entirely. You think about the API economy and the access you have to new ways of doing business, new potential partnerships, new ways of understanding data. That is absolutely at the fore of a lot of our thinking. It might change the agency relationships too if they got to be more technical in working with you guys. I think agencies are changing as much and as fast as companies are and they have to. They are an extension. They are your best. You should be able to look in a room of agency and your team and not know who is who. When you can tell who is who, you have a problem. And so agencies themselves have to become way more scientific, harder hitting, faster pace and outcomes oriented. Some agencies now are saying, you know what, pay me on outcomes. I love that, I love that mode to say we're in the boat with you, pay me on outcomes. And the big SIs are right there too. Absolutely, yes. Michelle Paluso, new chief marketing officer at IBM, changing the game, bringing in some great mojo to IBM. They're lucky to have you. Thank you very much guys. Great conversation. Thanks for coming on theCUBE. Live at Mandalay Bay, this is Silicon Angles theCUBE. I'm John Furrier with Dave Vellante. Be right back with more after this short break.