Consumer Marketing: Q&A with Erik Blachford

“Good marketing is storytelling,” says Erik Blachford, Venture Partner at TCV. “And as an undergraduate theater major and sometime playwright, it’s in my blood.”

Erik has remained true to his passion. His first marketing job was at Butterfield & Robinson, a luxury active tour operator, writing brochure copy?—?an experience that convinced him to leave the adventure travel world for Columbia Business School. An internship at advertising giant Ogilvy & Mather helped him learn about marketing as a profession. He helped establish online travel agency Expedia within Microsoft in 1995 and built the OTA into one of the world’s top travel brands as the company’s SVP of marketing. He later served as the president of Expedia North America, and ultimately was named President and CEO in 2003. In time, Blachford rose to President and CEO of IAC Travel, managing all of IAC’s travel assets including Hotels.com, Hotwire, and Expedia. He is currently a Venture Partner at TCV.

In this exclusive interview, Erik discusses:

• The coming “Always Be Marketing” era
• Why privacy concerns will create new challenges for marketers
• How artificial intelligence could transform marketing

TCV: Sometimes it seems marketing technology is moving at a thousand miles an hour. How are brands supposed to stay on top of it all?

Blachford: There’s never been a more exciting environment for consumer marketers because there are so many channels through which they can reach potential customers. The flip side is complexity; marketing plans are increasingly difficult to manage. As a marketer, I’d stay focused on the two most compelling trends:

1. Online video advertising, which is rapidly going to make the 30-second TV spot obsolete; and
2. Influencer endorsements, which are seeing a resurgence among YouTube stars who recommend products and services to their millions of monthly viewers.

TCV: Consumers are being overwhelmed by ads like never before. Are we reaching a point where marketers might no longer be able to rise above the noise?

Blachford: It’s true that consumers have already developed heightened sensitivity to marketing messages, but we are entering a period where marketing and advertising will be even more ubiquitous than it has seemed so far. The most precious commodity is consumer attention, and marketers will stop at nothing to grab it. We are entering the era of ABM?—?“Always Be Marketing”. And that goes for a lot of consumers too, by the way, as everyone works their social media feeds tending to their personal brands.

TCV: How can brands best engage consumers in an ongoing dialogue?

Blachford: The last thing most consumers want is an ongoing dialogue with a brand. The more interesting challenge is to figure out how to cement an association between a brand and a given need or moment for a consumer. When someone looks up a home, for example, there’s a nano-second where they are deciding whether to use Zillow or Trulia. There’s no ad in front of that person; it’s a cumulative thing. That’s where real loyalty lies.

TCV: How has marketing changed in the years since you first started out?

Blachford: We used to have more opportunity to create a narrative around a given product or service. Attention spans are a lot shorter these days. You look at some of the classic print advertising as recently as the 1990s, for example, and you’ll see whole paragraphs on the page. These days you wouldn’t find one in a thousand people willing to read it all.

TCV: Is it finally time to drop the word “digital” when we discuss consumer marketing?

Blachford: Yes, it’s all digital now. The key is attribution and performance tracking. Once you have committed to understanding how your marketing dollars perform, you’re committed to digital channels and feedback loops. It’s basic marketing at this point. Even if you’re running print ads to drive traffic to a retail store, you’re running analytics on the back end to figure out just which channels drove the most traffic, and how well they performed.

TCV: Cross-device tracking promises to dramatically improve brands’ abilities to know consumers across their customer journeys. Google and Facebook have a huge advantage here because their users typically sign into accounts across multiple devices. How can marketers compete with that?

Blachford: It’s certainly an advantage, for now. But I think it’s only a matter of time before companies start selling some flavor of cloaking devices for consumers who don’t want their behavior tracked all the time. This is ultimately an issue of trust and one that shouldn’t be overlooked. Ultimately, I think it will pose a significant challenge to marketers. That said, those same consumers will still want to maintain relationships with brands they admire?—?it’s not hard to imagine a social network that connects consumers and brands?—?unless your target consumer agrees to add you as a “friendly,” you’re just not going to be able to connect with them.

TCV: How will VR/AR revolutionize consumer marketing?

Blachford: There’s been loads of hype about virtual and augmented reality, but I don’t think we’ll see any marketing impact from these technologies in the next 10 years. We typically haven’t seen any marketing on any new device or service until we see broad consumer adoption of that new channel. I think we’ve seen this play out in every medium since radio. So, I don’t expect marketers will be given an opportunity to tap into VR until the public starts using it en masse.

TCV: How might brands leverage AI to market to consumers?

Blachford: I’m sure many brands are already running search engine marketing off AI platforms, and I would guess that will be the default within a few years. Any platform that relies on crunching numbers to make marketing decisions will soon transition to AI for media buying. The same will go for content selection, such as which spot runs where and when. That’s prime AI stuff. The more interesting use of AI might be developing the content. It will be a while before we see robots shooting television ads, but I don’t think it will be long before we see AI coming up with jingles, scripts, and taglines, all pre-tested against specific target audiences.

TCV: OK, let’s say you are the new CMO at a consumer-facing company. How do you approach the job?

Blachford: The first thing I would do is set aside a decent chunk of money and headcount for testing new channels and approaches. You just have to have some kind of “marketing lab” or you’re going to miss out on opportunities, particularly once you are big enough to have real money flowing out the door on more traditional marketing channels. The next thing I would do is buy lunch for the head of product. Marketing and product are really two sides of the same coin now, especially when it comes to products where you try before you buy.

TCV: Thanks for your insights. Any companies particularly exciting right now?

Blachford: Within the TCV portfolio, I’m having a great time serving on the board of Varsity Tutors. They connect high school and college students with tutors online and are running tons of interesting experiments, marketing to both students and tutors while iterating quickly on their products. I mean, a situation where you’ve got a marketplace with consumers on both sides, and a great product in the middle? That’s what every marketer wants to work on!

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The views and opinions expressed in this article are those of the author and do not necessarily reflect those of TCV or its personnel. Venture Partners are typically independent consultants who are not employees of TCV but have a strategic relationship with TCV and/or provide valuable advice or services to TCV and/or its portfolio companies. The companies identified above as TCV investments are not necessarily representative of all TCV investments and no assumption should be made that the investments identified were or will be profitable. For a complete list of TCV investments, please visit www.tcv.com/portfolio-list. For additional important information regarding this post, please see “Informational Purposes Only” under the Terms of Use section of TCV’s website, available at https://www.tcv.com/terms-of-use/.