DA: 02:24
Hey, Amit. Thank you so much for jumping on the SaaS Breakthrough podcast with me. How are you doing today?
AB: 02:29
Good. Good. Thanks for having me, David.
DA: 02:31
Yeah, I'm super pumped to have you here. I'm super pumped to learn about Optimove. So I guess let's jump right in. There's a lot to talk about. Explain a little bit about Optimove, who your customers are and what you guys are doing uniquely in the market place.
AB: 02:48
Sure. So Optimove is a marketing technology, we sell to brands which sell direct to consumers, so that makes us like a B2B2C. What we do is it'll be easier to explain where we were located in the marketing technology stack, so we'd sit between the data layer, the data warehouse and all that good stuff where all of the consumer data is stored and between the communication channels, between the email service providers and push notifications and all that stuff. And then we orchestrate based on the data feeds those channels. So the idea is to maximize the value of each and every customer by communicating with them with the right channel, through the right channel, with the right message, providing them the best value that they could get in terms of marketing communications.
DA: 03:31
So that is really complex and really powerful. But I guess just give me more explanation. Does that mean that you guys save data in custom fields and you basically just like a data warehouse and then based on fundamental like scenarios or situations that you set up, it then sends to certain places, right?
AB: 03:48
So we tend to explain this, you know, the product as, as we look at it, you know, trying to find a good example is like a two sides of the brain, see how the left side of the brain, which is, you know, the more analytical side. So that side is what, where we take all the data, we flatten it, we build on top of it, our customer model, which helps, you know, which is a segmentation model. And then it also has a lot of predictive analytics and it gives to the marketer is that type of gap that usually they might have with insights into their customer base, which type of personas they have there? What are they likely to do? What's their predicted customer value, what's their particular, what's their likelihood to convert? And so on and so forth. That is the left hand side of the brain, the right hand side of the brain, which is the more around a creative side if you will. So, so we, we tend to look at that as, you know, the campaign management side of our software. So we take all that insight from the left hand side of the brain and then leverage that in order to provide the marketer with a very smart campaign management. So there they'd be able to build target groups because we're directly connected with the data and start sending out campaigns. And then the connection between be the right hand of the left hand side is the AI Layer, which would then based on the, on the campaigns that the marketer is sent, would say, okay, this works better, this works, you know, that this is less efficient. Let's further break down the segments. The AI layer helps finding the white space and further, find the potential to maximize customer value. And the idea is that our main KPI to measure success, it varies because what we do is we treat every compaign a test versus control. So you always measure the marginal uplift and then you can measure based on revenue, based on profit, based on visits to a website and so on and so forth.
DA: 05:36
That is incredible. Obviously there's a lot of stuff going on there with your technology and that sounds amazing. So I want to go into how you guys have been able to market that. But before I do that, I just want to know when did you actually join the team and maybe what the company was like or the marketing team size was like at that time.
AB: 05:53
Sure, so generally the company was founded in 2009, two co-founders to the company. They met out of the Tel Aviv University. The company was foraged from academia, academic world, so one of the co-founders was doing his masters (inaudible) for operational research, the other one was doing his PHD from machine learning and they come together and applied an operational research motor model into a customer modeling mechanism. So they took some kind of, I won't get into the bits and the bites, but it's a state machine that's a very common model for operational research and applied it to marketing. So they'd be able to segment customers into small micro segments, see how they migrate between micro segments, which is parallel to how in the state machine, how functions migrated from one state to another state. And then based on that, this model can predict future behavior. And once again segment down to very, very small entities.
AB: 06:50
So that was taken back in the day and they sold it as a service so they would know, reach out to all of the larger retailers out of Tel Aviv, Israel, and, you know, bang on their doors asking for, you know, give me access to your data. And back then 2009, you know, especially out here out of Israel, it wasn't, you know, such a common practice to, you know, take leverage data to, invest in your existing customer base. So at the beginning was very hard to find, you know, people that would be able to willing to share their data. But we had success with some of the larger retailers out of Tel Aviv. The ideal was even back then, that it's very, very hard to scale a services company. So from day one, the two founders knew that at some point they want to, they want to, you know, pivot into becoming a SaaS company. And the model was bootstrapped. We never took any VC fund. So what they did is they used to teach in the university during daytime and a night time, you know, sell that model and as, as a consultancy service with the margins, they started developing the software and then hire the first developer and so on and so forth, and around 2010-11, the first version of the software was out there. And back then it was, they just bake that, that model into a software where you feed with data and the output is a very robust granular segmentation and predictive analytics per each and every customer fed into the model. Fast forward around 2013, we rebranded and then that's when the company was started to be called Optimove. That was the name of the product. And then around 2015, over 60, 70 percent of the company's income was from SaaS licensing where that point per se, we're a, you know, a SaaS product, a company.
AB: 08:38
I came in around 2012 where at the beginning to begin with, I wasn't even a marketer. I came in so, as I mentioned, one of the co-founders of the company, Pini, which is today the CEO of the company also, he was my professor at school. I started, I studied industrial engineering and then, you know, I just sent, sent him this type of kras email saying, hey, how about we change our relationship from, you know, student professor to employer employee, he appreciate, appreciated, you know, by my approach brought me into an interview and then I joined the company as a data analyst. So that was the time when, when we sold, you know, the model as a service. So I used to consult based on this data to a lot of B2C firms out of Tel Aviv. So that's when I joined the company and that's how I started, you know, gaining my marketing experience, even though it's very different than what I do today because that was like more consulting in the B2C marketing space. And today obviously I'm doing B2B marketing. That's when I started in the company.
DA: 09:47
That makes a ton of sense. And congratulations to the founder, to everyone in this company, it sounds like an incredible journey and incredible ride. It's oftentimes you see these services evolve into, into SaaS, right? As you want to automate it because services is so hard to scale. So it makes a ton of sense. You know, I guess just listening to you guys obviously very academic, a lot of things happening in the SaaS company and the product itself. What is, you know, is there a pain point that you're facing when you switched over to marketing, trying to explain something so advanced, it's advanced technology trying to find product market fit for it, or do you feel like selling in the services first gave you guys a leg up on like how to talk to these companies who wanted it, how to approach it? Or is that something you guys had to figure out when you got to SaaS and started talking about it again?
AB: 10:34
That's a great question. Is pretty much the story of my life nowadays and you know, for the past 6 years. So the idea is that if you think about it, what we sell is a product that helps brands maximize the value of their existing customers. Now this is from a business perspective, it's counter, it's not counter intuitive, but back then talking about 2010, it wasn't as intuitive. Usually we'd sell to companies that have a vast online presence and then, you know, the whole entire online world is quite new compared to, you know, the traditional businesses. So they've been around, you know, the pioneers for 15 years and typically in, you know, quote on quote off new types of environments. What did, what, what, what is most intuitive to the marketer is to pump new blood into the system. So it's much more intuitive to invest into acquisition. But then retention is something that you know, is definitely not a commodity.
AB: 11:31
Something that, you know, if you tell a marketer, okay, you spent $10, you bring in a new customer, but then now I'm telling you spend another $10 and you know, you already have that customer. But what will just help you know, maximize their value. That's not as intuitive. Today the story's a bit different, but back then we had to fight to educate the market that, you know, relationship marketing and retention marketing isn't just email blast, it's so much more than that. So that's pretty much the challenge, you know, back then, today it's more intuitive and today, you know, we're just competing against, you know, the other company, the other solution providers out there, with, you know, our unique differentiators. But back then it was even, you know, building a business case was a nightmare.
DA: 12:15
I could assume it would be, like trying to figure out how to explain this complex thing. Like you said, SaaS has moved so much and business itself has moved so much and there's this idea of now that the knowledge base around education and retention and keeping customers versus just acquisition. So it's incredible that we're here. But, let's move over to some initiatives that now that you guys have language and have explanations that make sense, what are actual marketing experiments or initiatives that you guys are running that are bringing in new users. Maybe content marketing or advertising or something like that.
AB: 12:53
Yep. So, so great, great segue, I mean from, you know, the challenge back then where, you know, it's tough for you to build a business case and to help, you know, those marketers that are the decision makers of buying or not buying Optimove, you know, on how to, on how and why to do it. So that's why from day one we started doing a lot of content marketing, two main reasons. One is obviously educating the market because, you know, we needed to help those marketers understand that they not only need Optimove or solutions of the likes of investing in their existing customer base, but it'll also become a growth engine to the business. So we invested heavily into content marketing from day one. It's that and also the type of, of the DNA of the company. So Pini, one of the founders and the CEO of the company is a, some kind of, you know, he's a, he's a philosopher, so even used the blog before he even founded the company.
AB: 13:49
So, you know, the type of sharing knowledge, you know, posting our thoughts, and you know, generating content was always there. And that helped us a, you know, justify our existence, our existence as technology provider, but also in addition to that, once you teach someone something new, they're much more likely to follow your agenda. So then what we saw the results of this, you know, content marketing is that, you know, we were able to teach people new things and then, you know, we built our credibility within those, those people and then it was, you know, it just made sense that it would be able to, to, to sell to them. And we've seen, you know, the results. It takes time. It's not like, all right, tomorrow you invest in digital marketing and the day after, you know, the leads are just flowing in, but then you start hearing people saying, you know, giving you feedback and meetings on that blog that they read or on that article that they, that you contribute it on, you know, any, you know, trade publication and then you understand that there's a lot of impact in that type of content marketing, you know, the traditional ways of how to measure content marketing is, you know, you can measure organic traffic and then that's their, you know, how it helped building SEO and stuff like that.
AB: 15:02
But sometimes you can't measure direct ROI and when you get that type of feedback from prospects, when they say, I read this, it was super interesting. And then, you know, the salespeople would say, yeah, this guy came to us and mentioned the blog and mentioned that they, you know, read this and that article about you. That is the best feedback on. We're in the right direction in terms of, you know, the marketing strategy.
DA: 15:26
Yeah, absolutely. I want to break that down a little bit more because I think content strategy is complex in variety of reasons because one, there's the topical side of it, there's the strategy of what topics are you picking, what are you talking about, there's distribution and then there's tracking and how you're converting them into customers. So for you guys, when you were starting, were you going after keywords? Were you doing the SEO strategy or we just like, let's create valuable content and then if it was that, how did you distribute that out there? Because obviously when you're doing it, you're often times not bringing that organic traffic from keywords. How are you getting it in front of people that are the right prospects for you?
AB: 16:03
That's a great question. So, at the beginning, you know, very, like romantically we used to just general, if we have something that's worth sharing, we do that we did have from back then and those are one of the first marketing vendors that I ever started using a vendor for SEO. And what they did is, back then, you know, it was all about SEO strategy was all about link building, so you know, that was a common practice and that was the right practice. And then, you know, Google killed that, but always from day one we optimized the content that we did generate for the relevant keywords, but we didn't write to target those keywords, we wrote because we had what to write and which, and ideas to share and we took that content that we generated and then put it through, the SEO machine, being that the vendor.
DA: 16:51
Makes a ton of sense. So you did go with that kind of distributed SEO approach, but valuable valuable content. And where were you guys sending people to from that content? Was it just on the blog you would link to a pricing page? Does it go to a consultation, to a Webinar? Is there some type of mechanism that you're funneling them to from your content?
AB: 17:10
Right. So the content usually would help you position someone in the funnel, how high or low they are in the funnel based on what content they would, they would, you know, consume. And then what we do lose with a lot of retargeting across any ad network out there, we would serve them with content that would push them down the funnel. So for example, if you know, top of funnel would be, the what is type of content, then you know, you continue serving them on how to content and then lower in the funnel, business cases and user cases. And then we want to do is our main call to action in the website is requested demo. So once in terms of the content that the reader consumes, you're able to position him low enough in the end the funnel, then you would start serving them with a call to action of, you know, request a demo.
DA: 17:56
Love that. That is super smart strategy, like a retargeting content strategy. I love that. So as you started growing and you realize that content was working, I'm assuming you guys doubled down on that. How did you, how you scale that content, maybe you scaled it into teams or something like that?
AB: 18:11
So that's a, that's another great question. Thanks for that David. So what happened was, up until 2016, think was the third quarter of that year, we were bootstrapped, no external investment, reached a 110 employees back then. And then we took our first round of growth capital. We took 20 million, with the idea of how we started, you know, coming up against, you know, the vendors of the world the Salesforces, the Adobes, the IBMs of the world. And then you know, to put a, you know, a fair fight if you will with these guys you need deeper pockets. So we took on growth, growth capital and then the strategy was on what to do with this money would be doubled down on where you're strong. And as I mentioned from a marketing standpoint, we're always strong and heavily invested into marketing.
AB: 19:06
It's content marketing. And then, you know, we started juggling the idea of how do you double down on content marketing and then the answer was you become a publisher. So what we did at that point, and I think the idea was born around end of 2016 was we're building our own publication, back then codename OptiPub, you know, Optimove publication. And then we started, you know, we think this idea into, into real life and fast forward end of May 2017, we launched PostFunnel postfunnel.com, which is a content outlet by all means, generating an article a day, treating everything and anything post acquisition funnel for B2C marketers. That was our, our way to double down on content, become a publisher.
DA: 20:03
And how has that worked out for you guys? That's an incredible idea.
AB: 20:06
So there are a few phases on that way. So first of all, you want to build credibility. So when we launched, we pretty much kept, you know, a distance between the Optimove brand and the PostFunnel brand because if you position yourself as, you know, as a, um, as a publication that's backed by, by a business sometimes that will deteriorate your credibility. And once we reached a certain critical mass, of, you know, I think it was around 20,000 subscribers, then we pulled out the Optimove brand because you know, that critical mass already understands that, you know, you generate content, a very high value. And now that was the point and I'm talking about, you know, end of May, a couple of months ago, end of May 2018, we pulled out Optimove. Today, you know, on post you'll see PostsFunnel by Optimove because we have that critical mass and we build that credibility and authenticity that we feel comfortable to pull out Optimove. And now when that happens you get legitimacy that, you know, you can, your salespeople could, you know, reach out to people that you know, convert on PostFunnel and say, Hey, I saw you reading this and that article and offer them additional stuff. So that's, that's how the, we convert, you know, type of that high level top of funnel readers into MQLs.
DA: 21:23
That's incredible. And when you actually sat down, maybe you sat down with the founding team or the marketing team and are thinking through these ideas and you came up with the idea of the publication. Did you guys have set goals? They're like, we need to produce x amount of blog posts or x amount of articles each week, each day. Our goal line for KPIs should be x amount of traffic. How did that work when you guys came because you came up with a great idea, but going into such a big initiative, how'd you handle that?
AB: 21:47
So our benchmark was always you know our, our blog's stats. Because our blog was already at a high scale. It's been around for a few good years. However, the frequency of publishing posts was a bit different. So, we took that as a benchmark and we exceeded it very quickly because we were much more dedicated or not much more dedicated. We have much more resource to develop content, within PostFunnel. So we exceeded it very quickly and we put a benchmark on when we reach a 30,000, monthly sessions we pull out Optimove from, you know, behind the scenes and we reached that around end of May 2018.
DA: 22:28
Gotcha. So what, what was the publication or what was the blog posting amount on your blog that you guys upgraded? I'm just wondering from, from the size of going from a blog to a publication.
AB: 22:38
That's a great question. By the way, they both live together in harmony. So usually the publication. So the blog is more of, you know, dear diary, it's very first person, but then the publication is very third person, very looking at things from a higher perspective and trying to analyze it from a, from a third party point of view versus the blog that's very first person point of view, a rounder POV, if you will, and so on and so forth. So there's still live alongside and we still continue to publish a weekly on the Optimove blog and then we have PostFunnel, which, you know, we have, it's an editorial team, which we have an editor in chief, we have staff writers, we have a managing editor, we have external writers. It's a pool of around 15 external writers. So it's, it's a content machine.
DA: 23:30
That was an incredible idea. Really. Kudos to you guys. Was so smart to double down on that. I hear a lot of people saying they doubled down on content. That's been a channel that's worked for them. You guys really, really doubled down by building that entire editorial team publication team. So congratulations you guys. That's amazing. What about KPIs? Does the blog's KPIs look different from the publication's KPIs? It's all this around generating MQLs or are there different things that you have to look at on both?
AB: 23:56
So the KPI's, how we see from, from a marketing standpoint is derived from the companies, from you know, the business KPIs of the company. So there's a revenue goal for the year and then we, we reverse engineered into how many MQLs is that we need to generate, what the conversion rate that we need to generate in order to hit those goals. So that's how we do it. And then we gauge how many leads would we be able to generate off PostFunnel, how many leads would be able to generate off, you know, search and so on and so forth, out of events, which is also a big channel for us. And then what we do is we build the business plan according to that at the beginning of the year and obviously, you know, moving forward, on a quarterly basis, we measure how we are and you know, in comparison to our goals and adjust if necessary or you know, just to see that, you know, our initial plan was great and continue at the same pace.
DA: 24:44
Love that. That's super smart. So goal mind, break it down from there, break it down by quarter by month by objective, stuff like that. That's amazing. And what about the biggest, you know, you've been there since 2012, what's been the biggest win for you?
AB: 24:57
So I think that, you know, obviously PostFunnel was a huge win for us. I think, you know, when I started, it was, you know, so as I said, I started as an analyst and at some point you know the requirements for a marketing team because up until then, we enjoyed a lot of organic leads and at some point, you know, you want to take that to the next level. So, I pivoted, you know, was a pivot by my CEO that decided, you know what, let's try you doing marketing. And back then we had someone, you know, I'm half time doing a lot of content, so it was me and him, and you know, fast forward 2018 today, I have a 19 person staff and you know, that for me is a huge achievement, you know, building up from something that was, you know, a very low budget, very, you know, a guerrilla style marketing until you know, much more structured, a large team, you know, very facilitated, you know, that for me is a huge win. Today look back and see, you know, that type of trajectory and that type of story, a business story. That for me is a huge win.
DA: 26:06
Congratulations. It's a gigantic way. It's amazing to hear that and it's, you know, it's exciting and it's also, inspiring. So congratulations to you again and looking forward. Now that you have the publication together, you have momentum in the marketing team. The company is still growing. You have this growth round in, where are you guys going to evolve in 2018 or so just doubling down on what's working?
AB: 26:30
So I think that, you know, in terms of, marketing infrastructure, we built it all and now it's just, you know, building up. So we built the base for everything, everything you know, all the mechanisms, all the marketing technology stack is, and now it's just, you know, building more scenarios, more journeys, you know, continuing to enrich that and in terms of, you know, of markets. So we're now also looking into a penetrating Asian markets. Currently we're serving North America and Amea and we're looking to penetrate as I said, Asian markets and additional business verticals. So currently we serve retail, we serve subscription based businesses. We serve the gaming industry and now we're looking into financial services and so on and so forth. So it's both expanding geographically and widening know the range of business verticals that we service.
DA: 27:24
Makes a ton of sense. It sounds like it a lot of work, but a lot of fun for you guys in marketing there. That's challenging, man. Always is the next growth steps. But based on time here, what I want to do is jump over to our lightning round questions. This is just five questions that we'll go through. I'll ask you a quick question. You can answer with the first thought or first piece of advice that comes to your mind. It's really fun. Wanna get started?
AB: 27:45
Let's do it.
DA: 27:48
Let's do it. Alright. What advice would you give for an early stage SaaS company today? Starting marketing.
AB: 27:54
So I'd say first and foremost, probably hiring, you know, that type of round talent that strong, both his right and left side of brain and because I mean if I'm looking my example, you know, I used to roll my sleeves, you know, build campaigns on the digital marketing, write blogs, and then again have the ability to analyze and understand what works and what doesn't. So you want to have like that type of all around player because marketing is something that you can learn in academia. But you need to also get your hands dirty and roll your sleeves and you know touch things in order to build that type of experience. So I'd say, you know, hiring that round type of talent and, you know, giving him freedom to start, you know, obviously with a certain, with certain boundaries, but giving them freedom to, you know, start building for the marketing org.
DA: 28:36
I love that. That was a great answer. What about a marketing skill you think is vital for marketing teams to improve and build on today?
AB: 28:46
Wow. So, I've been asked this question before and, and, and the first thing that comes up is storytelling. You know, it's like, I, I like to look at this as like, you know, if a chef is an amazing chef and he knows how to cook, right? But he doesn't play know his dishes very well. It won't be appealing is even though it could be delicious. So storytelling is all about (inadible). You know, you can have an amazing product, but if you don't tell its story correctly, so you know, it doesn't worth nothing. So I think that, you know, if you're able to build that type of ability to do good storytelling, that's, you know, a game changer.
DA: 29:16
Any recommendations were to learn, to tell good stories?
AB: 29:20
A lot of reading, reading, you know, good stories, reading books, you know, that's how to, to build that skill of storytelling. And I think that it's something that, it's also something that there are people in the world that have it and people that don't have it, so just, you know, the ability to find people and, you know, what, what do we do? You hire people so you can ask them, you know, to tell them to as a, you know, as a job interview question, tell me the story of life. I always, you know, when I interview people, what I say is marketing is all about storytelling. Tell me the story of your life.
DA: 29:49
I love that question. That is a great, great question. What about the best educational resources you'd recommend for marketing?
AB: 29:55
Google. I think that, you know, everyone's done everything already. If you write the right query into Google, you're going to get an answer for everything. Even taking it back to when I was like an analyst, and I, and I started coding a sequel. I had no idea. I asked Google and it answered. And then, you know, today looking for best practices are looking for different strategies. You know Google and build the right network of your peers, which can also, you know, help you, you know, share thoughts and ideas. But, but Google knows it all.
DA: 30:26
Google does know, it all just takes a little bit of elbow grease to do the work to do it. What about a favorite marketing tool you can't live without?
AB: 30:33
So, that's a good question. I think, you know, the, the tool that I use on a day to day basis and it's my task list and it's my everything and anything is my email, but then it's probably not a fair, a fair answer. So I would say Linkedin. Linkedin because you know, us in the SaaS B2B world, you know, you get a lead come in, you want to, you know, see if it's viable or not, you know, look them up on Linkedin. You always gonna get a good answer, company size, stuff like that. So Linkedin, you know, searching for, you know, job candidates, you know, Google is, is your place, you know. I spent a lot of time on, on Linkedin. So I, did I say Google, I'm on Linkedin.
DA: 31:12
You said Linkedin first. That's perfect. What about a brand business or a team that you admire today? Last question.
AB: 31:22 Um, wow. I would say Hubspot, I think that, you know, those guys have done an amazing job with content marketing and as you know, you know, I'm a big fan of marketing and you know, I definitely aspire to those guys and you know, I visit and read their content, you know, on a regular basis and you know, I get some great ideas from what they're doing. So yeah, Hubspot.
DA: 31:43
Yeah, they're a great company. I've seen them on stage a couple times at SaaStr and incredible story, incredible company, and doing amazing things, so really good answer and I just want to thank you so much for joining me today. Sharing so much amazing info. I learned a ton. Some really great answers there in the lightning round as well, so really appreciate your time and thanks so much for sharing today.
AB: 32:02
Yeah, thanks for having me. David was a great pleasure.
DA: 32:06
Wow. That was an incredible episode. Really, really, really just a big thank you to Amit to the entire Optimove team. Just their story is incredible. The years, the time, the knowledge, the education that has got into their product and it's just going to be exciting to see their product continue to grow and build in this space. Hope you guys took a ton away from today. I think the idea behind their content machine, how they really, when they said double down, they really doubled down by going all the way into creating a publishing blog all around their industry. (...)
About Amit Bivas:
