From AppLovin to CRAFTSMAN+: Alex Merutka on Building the Future of Mobile Advertising
- Aug 3
- 72 min read
Mobile advertising has become one of digital marketing’s biggest innovation engines, driving breakthroughs in privacy, AI-powered creative, and performance optimization. Few have witnessed that evolution more closely than Alex Merutka.
In this episode of Signal & Noise, Rio Longacre and Brett House sit down with Alex, Founder & CEO of CRAFTSMAN+, to discuss the future of mobile advertising, creative intelligence, and why creative is becoming performance marketing’s greatest advantage.
Before founding CRAFTSMAN+, Alex helped build AppLovin into one of ad tech’s most influential companies. Shortly before the IPO, he made the surprising decision to leave—walking away from a reported nearly $10 million bonus—to bet on AI-powered creative as the future of advertising.
Together they discuss:
Building AppLovin from the inside
Why Alex left to found CRAFTSMAN+
How ATT reshaped mobile advertising
Why creative is replacing targeting as the key performance driver
AI’s impact on creative production and optimization
Playable ads and the future of interactive advertising
Founder-led marketing and building in public
The future of app monetization and mobile advertising
The conversation explores why performance marketing is entering a new era, where success depends less on audience targeting and more on creating, testing, and improving creative at scale. Alex also shares lessons from hypergrowth, entrepreneurship, and building through industry disruption.
Whether you're a marketer, founder, product leader, or interested in AI's impact on advertising, this episode offers an inside look at where digital marketing is headed.
Watch the full episode and join the conversation.
🔑 What We Cover💡 Key Takeaways🎯 Why This Episode Matters
Read the full transcript below.
Brett (00:01.038)
Hey everybody, welcome back to Signal and Noise. This is Brett House, joined by my co-host Rio Longacre. Today's guest is Alice Marutka, the founder and CEO of Craftsman Plus, former app lovin', which we'll get into. Welcome to the show, Alex, before I give a more formal introduction, thrilled to have you. Yeah, and and Alex's promise to be as authentic and as not to be generic sounding, but to be as authentic and real.
Rio (00:06.175)
Yeah.
Alex Merutka (00:20.59)
Yeah, Brett, Rio, thank thanks for having me guys.
Brett (00:30.39)
and open which which I think is you the we're gonna love it's gonna be a great conversation but for those people that don't know who Craftsman Plus is it's an AI and I'm gonna do my best to describe it Alex an AI creative infrastructure platform that helps top mobile brands scale creative output across channels like meta google tick tock programmatic without sacrificing quality so that's kind of the the positioning take from the website my take is sort of don't mistake you guys for a creative shop
You're clearly not that. It's creative infrastructure with performance data and workflow automations built in. so it's AI powered. Is that a is that a correct way of describing Craftsman Plus? Yep. And we'll get into more details. but you know, to me the the product thesis is what I came up with, and it's and and I think this is just something that we're gonna talk about in this episode is how you sort of charted your path into this org from app app levin. But this idea of speed plus fidelity is
Alex Merutka (01:08.612)
Yep. Perfect.
Brett (01:27.02)
You know, it's a conversation that Rio and I have with a bunch of of other founders and product leaders, right? That AI is really moving manual creative asset production for advertising or for other purposes to an operating loop that that kind of connects the build to the the activation to the measurement, etc. And and so it sounds like you guys are doing some really interesting things in this space. and mobile ad creative is hard.
Right, it needs to be technically compliant, it needs to be interactive for for various screen types, it needs to be performance tested. So it's not just banner ad assets that you're generically versioning.
Rio (02:06.033)
It's it's like the battleground, like, you know, of of seeing what works, right? I think there's no better place when you look at how many people are actually on mobile, which frankly, Brett we've talked about a lot in this pod. It's underappreciated, undervalued when you look at how much time people spend in it.
Brett (02:18.251)
Yeah, yeah. We had Michael Ackerman from Digital Turbine on at Possible in Miami, and I'm sure you you probably know him personally. Great guy, by the way. Great guy, super cool guy. But he was basically like like everybody's looking for incremental reach. They should be looking at the app ecosystem. That's where people spend I think forty percent of total consumer time spent is in apps on your mobile devices, and yet everybody's fighting for the nickel and diming kind of the open web, maybe non-mobile ecosystems. But but what I wanted to get to
Alex Merutka (02:23.546)
I I love Ackermen, yeah.
Brett (02:47.711)
And without being too long-winded, I'm known for this, that's why Rio interrupts me occasionally. So before Craft Plus, you were an app love it and spent a decade there. You were one of the earlier employees. you helped really lead the company's programmatic business and performance media through kind of an unprecedented peri unprecedented period of growth, right? And yeah. Through the IPO. And and it was what was it, 2021 and it was 24 to somewhere in the twenty four to twenty eight billion dollar valuation, right?
Rio (02:52.415)
So I cut off a lot, yeah.
Rio (03:08.755)
Meteoric rise, right, through to the IPO.
Brett (03:17.696)
Right.
Alex Merutka (03:18.904)
Yeah, twenty the IPO'd at twenty nine billion.
Brett (03:21.207)
Twenty nine billion, right? And now it's I think it's valued at more than a hundred billion. I may my date my data might be a little off, right? With Yeah, and forty-two percent of mobile gaming ad the mobile gaming ad market. So a very cool place to play, but you made headlines for walking away w and this is this is the the the punchline, not to to announce it ahead of time, but for what was reported as a ten million dollar bonus to start Craftsman Plus, which sounds to me like the perfect entrepreneurial story where you sort of take risk.
Rio (03:27.199)
It's the biggest out tech company officially, yeah, by far.
Brett (03:50.636)
Because you realize the timing is right. so I really want to we really want to get into that, your whole story. And Alex, thank thank you for joining us and welcome to the
Alex Merutka (04:00.141)
Yeah, yeah, thanks for having me. And I think they got that story wrong. I mean, a ten million dollar cash bonus would would be a little different. This was this was the stock options that basically ended up turning out to be a lot more than ten million dollars at the current valuation of app levin. But yeah, more more or less, I mean, the main thing for me, it wasn't about money back then. it w it wasn't purely about money. Adam Farogi, the founder of App Levin, I mean
Brett (04:10.676)
Yeah Yeah.
Alex Merutka (04:23.041)
Getting the opportunity to work with him and that whole team was super special. And and when I joined them, I I was really lucky. You know, I graduated college right when the app store basically launched. And so when I was sitting in college and everyone started playing these games on their phone and I was, you know, I was used to games costing money to play. And and so I'm looking around and everyone's playing these games on their phone. I'm like, How do these guys make money? And someone said advertising. I'm like, no way advertising makes that much money on mobile. There's no shot. How like how do the economics work?
Brett (04:40.641)
Yeah, yeah.
Alex Merutka (04:52.057)
So I was pretty curious. App Loven ended up poaching me. And again, you know, right place, right time, joining the mobile ecosystem. This is yeah. Yeah, this was too like early 2014. So I was at AppLeaven for five years. I I hung out there, learned a ton, but Adam was just, you know, he was just such this incredible leader. I mean, the guy could go in and and jump in on product.
Rio (04:58.567)
This is super early, right? Alex, you were like one of the first employees, right?
Alex Merutka (05:17.783)
He could jump in on the sales side, business, culture wise. I mean, it was just total rock star mentality everywhere in the business, like and every all my coworkers as well. There was just like a different energy that felt really fun and exciting. I think when we all joined, most of the guys that worked there were in their 20s. Like we were all new 20 year olds working and trying to figure this out. And we had one guy in his 30, Adam, who had built a few other companies and kind of knew the playbook. So when I left App Levin, my thought was, well, how am I ever going to be Adam?
Brett (05:42.402)
Yeah.
Alex Merutka (05:47.596)
If I'm working for Adam my whole career. Like I mean, I had a great job there. I I I I loved what I did. I worked with a bunch of amazing clients. But the two things I realized was, yeah, how could I would would people actually follow me? Could I actually build something? And if I'm always working under Adam, I wouldn't be able to test that and actually know that. And the other thing was while I was at App Levin and I was running, you know, eventually I took over the programmatic team and was running the supply side platform and the DSP. And what I realized was some of these advertisers that would come in.
You know, they'd be spending two hundred bucks a day on App Levin. And all of a sudden we would, you know, work on their creative and change and put out a different creative for them. And their spend would go from $200 a day to $20,000 a day. And for me, that was really exciting. Yeah, it's it's like you you can only tweak the algorithm so many times, especially I'm not an AI engineer. Like, you know, maybe you can make the algorithm one, two percent better, which is phenomenal, right? If you can improve your algorithm a few percentage points every year, that's incredible. But the
Brett (06:30.411)
L light bulb moment, right?
Rio (06:31.955)
Yeah.
Brett (06:42.219)
Yeah.
Alex Merutka (06:46.061)
Big hits were the second we changed creative and we found a creative winner for an advertiser, their whole their whole company changed. It was, it was like the needle moving, game-changing moment was actually creative. And I remember when I left AppLove and Adam actually told me, like, hey, why are you building a creative company? there's there's not a lot of money in creative. So creative always gets kind of undervalued, and it's especially back then, especially mobile creative back
And he's like, you know, there's only one billion dollar creative company in the world and it's Adobe. So like, you know, there's a reason why. You should go do something else. Like, you know, you know, if you're if you're gonna leave, maybe do something that that has like bigger legs to grow. And then now you look at and you got Canva, you got Figma, you got all these creative companies. So like it was, you know, you know, I wish I built Canva or Figma, right? But you know, we we we built a company very specific to solve the problem I saw at Apple's, which was helping performance advertisers build better creative.
Brett (07:21.228)
Yeah.
Rio (07:28.788)
Yeah.
Brett (07:30.196)
Yeah.
Brett (07:41.728)
Yeah. Well and interesting that you had that that comment from Alex that that considering you kinda you looked up to him, he was somebody you sort of wanted to to you you saw him as very successful, somebody you probably admired, and he makes that comment but y
Rio (07:53.981)
Yeah, mentor for sure.
Brett (07:55.18)
But you decided to kind of fight through that. It's almost like you hear those stories of like you know Michael Jordan not making his junior year high school basketball team, right? It can be a little discouraging when you hear that from the people that let that you're working under or your coaches or your your CEOs, that kind of thing.
Alex Merutka (08:07.062)
Yeah. Well I mean
Alex Merutka (08:12.192)
Yeah, for for me, it was just funny because I was, I think I was twenty-six or twenty-seven when I started the business. tw probably twenty-seven. And and you know, he's like, he's like, you know, maybe you build this company and you sell it for a couple hundred million bucks and you know, and and that's what it's at. And I'm sitting there like, Man, my my mom didn't even go to college. Like, like you you're talking about a couple hundred million dollar exit. That sounds incredible. I didn't really get what these numbers meant. And I think what Adam was trying to tell me was actually the
Brett (08:34.888)
Yeah.
Alex Merutka (08:41.334)
Like, hey, you're gonna be a successful founder, you should go for something really big because you the it's about the same amount of work building like a $10 million a year business to a hundred million dollar year business. You still have to deal with all the admin, you have to build the culture, you have to hire, you have to fire, you have to go through everything. So if you're gonna go build a company, you might as well go big because it's about the same amount of effort that you have to put into running like a massive business and a smaller business. And I remember
Actually the CRO at App Levin had told me that as well. When I asked him, like, hey, how's it feel running, you know, a billion dollar P L versus like your ten million dollar PL before? And he's like, It's the same amount of work, just different numbers. So like not not much has changed. You might as well go VIG.
Brett (09:21.218)
Yeah.
Rio (09:24.253)
Yeah, well that's funny. So I mean it's I mean this is part of the story you wanted to dig into, right? Like knowing that you left to start your own company because I mean you were you you you were successful there, you're making money, they were on a great trajectory, you got great experience. You're ahead of programmatic when you left, looking at your at your at your LinkedIn profile here. But then it seems like you saw a different future for advertising, right? One in which or maybe just an like a a different an alternative future that was put was just as viable and you could build a company or you could build a business around.
Brett (09:24.839)
that's great.
Rio (09:52.36)
It was the not just targeting, but creative was going to be this big driver of performance. I love that because I think I mean I I've been working in advising CMOs for almost 20 years now. And there's always been this tension between, you know, the creative side and then the analytics, data, now AI side about, you know, do you have to be one or the other? But I think in the reality is you need both. And to your point, like when like there's almost only so much juice you can sometimes squeeze out of out of pr out of t twisting knobs and dials in order in order to tweak things.
A lot of times it just comes to creative and creative fatigue. In fact, I I wish it's funny, I initially got interested in some of the stuff you're posting, work you're doing, Alex. I saw a couple of posts you'd made on LinkedIn. This must be about a year ago. And I remember one of them was about interactive end cards and how it can really impact performance. And I remember thinking, this guy like really knows his craft. This is great advice this guy's giving. I saw like you were like the the founder and CEO of the company, and I I love executive-led communications. I thought it was a really cool way to talk to your
your customers and to the public in general, they really showed that your expertise in what in what your firms invest in. So I thought that was very cool and certainly like part of the story here, if that makes sense.
Rio (11:01.321)
So when you joined App Love and it was pretty small, like what like like 'cause you were so Adam recruited you like right out of like right out of school. Is that how that happened?
Alex Merutka (11:09.708)
No, so I worked at a competitor actually. and I I joined a competitor right out of school. And, you know, thank God, y you look back in career moments and it it's funny. I, you know, I started believing everything happens for a reason. And and this is one of those points where I'm a pretty loyal guy. Like I applied for a job that said you needed 10 years experience to apply for, and it was like a senior sales role at this competitor to app level and publicly traded company.
And I went in straight out of college. I had zero experience. and I applied anyways, because why not? You know, why not go for it? And I got to the final round of interview and the guy, you know, looks at my resume and looks at me and goes, Man, you just graduated. There's no way you have 10 years experience. Why would I ever hire you? Like, you know, you're you're Yeah. Yeah. And I just told them the the the the most obvious was, man, I made it to your final round of interviews for a reason with zero experience.
Brett (11:54.126)
There there's a tough question, right? Yeah, it's like what was your response?
Rio (11:54.729)
What'd you say?
Alex Merutka (12:05.656)
Can you imagine that? Like this, you can mold me to whatever you want. And we're I'm joining a mobile advertising business, right? So why are you wanting guys with 10 years of experience and desktop to go run this?
Rio (12:15.295)
Who mobile hadn't even been around basically ten barely ten years at that point, right?
Alex Merutka (12:18.784)
Exactly. It it it exactly. The point was that if I'm gonna join an industry at a college, I want to join something where it's an even playing field. If I try to go join like a Yahoo sales team, I'd be the grunt on their team. They would have made me do a bunch of bitch work basically early on and just like do a bunch of tasks that weren't really gonna like make my career as a new person going into a Yahoo like established org business on desktop. But then there was this mobile advertising sector of the business.
Brett (12:19.564)
Yeah.
Brett (12:29.185)
Yeah, yeah. Yeah.
Alex Merutka (12:44.416)
And I just told them, look, I have zero experience and I still made it to your final round. That must show you something that I'm different. If like if I needed a ten years experience, I wouldn't have made it here. But clearly I made it here.
Brett (12:52.779)
Yeah, and you and I think you said two two key things. You said you're you you'll you're mold there's moldability, right? Which means I'm willing y you know, you s you're someone that I can I can help shape and form as I move through my career. And just this the subject matter, I'm I'm a mobile native. So I've got a level of subject matter expertise f in this particular category that nobody else you're looking at is gonna have.
Alex Merutka (12:58.37)
Facts.
Rio (13:11.615)
Well plus Brad, you think about this is pro plus this around 2014. You think about it, like the iPhone moment was like just a few years before that. Like no one really had like any legit mobile marketing. Maybe some people had done like text messaging right before that. There was like there was not like what we think of mobile marketing today, mobile advertising today, like no one had and funny, I saw an ad the other day, it was people making fun of it on LinkedIn about it was asking for ten years of experience with claw. I think it was AI generated ad, you know, employment ad obviously, but it's ridiculous, it's ridiculous, right?
Brett (13:24.226)
Yeah.
Alex Merutka (13:38.07)
Yeah. Yeah, totally. Totally. Yeah, so when when when I left, in twenty twelve, I basically joined this company like right at twenty thirteen, the start of twenty thirteen. So yeah, mobile had just come out. and anyways, the guy liked me and he was like, All right, you know, we'll give you a shot. We'll we'll we'll see if this works out. So I joined, I was super hungry, eager to learn, right? Just graduated college, was excited to have a job basically.
Brett (13:38.57)
With Claw. That's exact exactly the same thing. Yeah, exactly the same thing.
Alex Merutka (14:03.669)
But really interested in the space because I was playing games all the time in college. And so I just couldn't pay attention to the teachers. I I like to be like more self-taught. So I'm like trying to pay attention. I can't. So I start going on my phone playing games and I'm like, how the hell did these guys make money? What's going on here? So it was a curiosity that sparked it. But you know, I'm a pretty loyal guy. So I worked at this company for a year and they told me, hey, in a year's time, if you deliver XYZ, we'll give you a promotion, we'll give you a raise.
Brett (14:11.906)
Yeah.
Brett (14:17.602)
Yeah.
Alex Merutka (14:29.847)
And know, the raise was a 20K raise. I was making 70 grand base salary. They're offering me a 20K raise here. And I hit every single target. they kept moving the goals. When I hit the target one quarter, they like tripled it the next quarter, and then I'd hit that and then they triple it again. It like they yeah, they made it impossibly hard to hit it. Well, by the end of the year, I barely hit the like 26 27x goal that they set for me. I'm like one of the top reps in the entire organization at this point because I just hustled so hard because I really wanted that promotion.
Brett (14:34.444)
Yeah.
Brett (14:42.187)
Yeah.
Alex Merutka (14:58.645)
I walk into my boss's office, he gives me ten K raise and no title change. And and and just says, Hey, you're making enough money when I was your age, you know, you you're you're doing do your This was yeah, so
Brett (15:08.661)
Yeah, well and and yeah yeah. Yeah, and and and dealing with an entry level guy that he thought he could do this to, right? Yeah.
Rio (15:09.789)
This is corporate America, deal with it, right? Yeah, it's
Alex Merutka (15:16.821)
Yeah. So and I and I'm twenty one at this point, right? So like I'm getting bullied by like some guy who's he said that and I I just quit. I I quit the next day. And I'd been recruited by OpLovin for months before, which yeah, I wish I would have taken the job at Op Lovin six months before. I would have got more equity, more like better upside on that equity. Just that six months different in that time of hypergrowth is massive when you think of like valuations on equity and the amount you can get. But anyways, I stayed loyal. the guy, yeah, I I
Brett (15:38.209)
Yeah.
Alex Merutka (15:44.288)
I get this conversation happens to me. And then he says, you know, if you go join that I told him I'm going to quit. And he's where are you going? I'm like, I'm going to this company called App Levin. And he goes, You're going to be begging for your job back in a week and I'm not going to give it to you. And you're going to regret this decision. And and I remember walking out of the elevator and my my current boss, not the, not the SVP, but the one below him that knew me more and managed me more, who's now the chief of staff over at Sony, he was like, You know what? we all better be careful because one day we might be working for you.
And I thought that was insane because I was 21. I was like, no, there's no way this will happen. But it was awesome. That guy, that guy's a rock star. I mean, he like he actually knew what he was talking about in the business and understood the technical side and product. But anyways, I go to App Levin with that fire in my belly, right? Like I came over with the this guy thinks I'm gonna fail. He thinks that I'm gonna be begging for my job back. I'm going to crush them. I'm gonna take every single account they have, pull it over to App Levin and ruin these guys. And so when I came over.
Rio (16:16.895)
It's a great compliment.
Brett (16:18.529)
Yeah.
Brett (16:29.26)
Yeah.
Yeah, this is
Ha ha ha.
Brett (16:41.313)
Th that's that's the competitive fire in your belly, right? That's the competitive spirit. That I was gonna ask that. I was gonna ask that. What what college sport did you play? Just out of curiosity. Okay. Yeah yeah.
Alex Merutka (16:44.031)
Of course, yeah. I played I played college sports, like I was ready to go. Yeah. I played volleyball, so San Diego kid, you know, yeah, was wasn't athletic enough to play basketball, but volleyball was a pretty fun like intermediary spot.
Brett (16:57.739)
Yeah. Yeah, so you have a little bit of that in you where it's just like, Hey, this is a game and we're playing this game and I've just been insulted and you know
Alex Merutka (17:05.279)
Yeah, and now and and and I loved I went into App Levin and it was like, you know, cupanoodle, ramen, go-karts in the middle of the floor. I was like, what's going on in this like garage? Like there's this, there's go-karts and and ramen and and then I met like the I met the whole team and I was just so impressed and blown away. And also, you know, shout out to my clients at the time. I had two of my clients that had said, Hey, Alex, we we love working with you, but just so you know.
Brett (17:12.939)
Yeah, yeah.
Alex Merutka (17:33.027)
we spend 10 times as much money on AppLovin than you guys because their product's a lot better. So you should go look at this. So I got a tip off from clients that basically pre-vetted the product for me. And then when I looked at their dashboard, and this was a super basic dashboard, but we didn't have anything like that back in 2014, 13. And I looked at it, I'm like, man, this is just logical and makes sense. Like anyone who's seen AppLoven UI knows that it's very clean. It's just super logical. It's one of the easiest platforms to use.
Brett (17:57.57)
Yeah. So so let me
Rio (17:57.982)
This is before Axon, this is early on, like I think probably when they still had the gaming yeah, still had did they have the gaming studios yet? Or 'cause I know there's b they they b okay.
Alex Merutka (18:00.993)
Before all that.
Alex Merutka (18:04.927)
No, that that was like five years later. No, this was pure like we were a small team battling against chart boost, ad colony and and Vungle in in Iron Source and like supersonic ads back then.
Brett (18:15.745)
Yeah. Yeah, so so if so back to kind of sort of the theme, if AppLoving sort of proved that performance engines can scale media buying
And and I o we've always found it super interesting. We've had a few conversations in the past about this, about how a lot of that that innovation around performance marketing, you'd think it would have happened in the digital sort of programmatic ecosystem or otherwise, but it really did happen in the sort of app ecosystem and the mobile ecosystem and the where it started. Is is s is so with that in mind, is Craftsman Plus trying to prove that creative can become just as systematic
Rio (18:37.855)
That's where it started, yeah.
Brett (18:48.945)
to become kind of a performance engine because it has been kind of a manual asset delivery process for decades, right? So w yeah. How do you how you th how did you think about that? And what what was your sort of operating thesis?
Alex Merutka (19:02.645)
Yeah, I mean it's all about the closed loop ecosystem. So what we see is one, everyone launched an ad business over COVID. So COVID hit. Well, there's a couple things that happened over COVID. One, a lot of people became gamers. So people started playing more video games, more mobile games, like download usage went like through the roof. Fortnite, Roblox, everything hit over COVID. So there's this big shift of like people playing more games over COVID. The second thing is all these businesses took pretty big hits and they needed to find ways to be more profitable. So everyone launched an ad business.
Brett (19:15.445)
Yep. F Fortnite through took off, all that stuff, yeah. Yep.
Alex Merutka (19:32.107)
You got like Home Depot ad business. You have like Walgreens, you have all these other businesses, Netflix, Uber, Lyft ads, you know, everyone starts an ad business all of a sudden at the same exact time. And they're all realizing because it's easy, right? It's digital, it's free. It doesn't cost anything to start an ad business. And it just makes you more profitable. You get airlines doing ad businesses now a lot more. They're they're pushing their ad businesses a lot more. So you're looking at that. There's this evolution of everyone building ad businesses. And it's great timing with AI because you can build out targeting pretty easily now.
Brett (19:42.282)
Yep.
Brett (19:53.558)
Yeah.
Alex Merutka (20:02.122)
So when you think about these models, like before Axon 2.0, you know, basically Moloca was a DSP that had a really good algorithm and they were thinking they were they were, you know, probably the the best mobile first DSP in the space at the time. And and I integrated them into App Levin. So I could see, you know, what DSPs are spending, what they're doing, how they're performing. Like I could see all this. and
App Levin basically updated their model into Axon 2.0 and took off. You saw this like massive gain in acceleration with the different way they're structured their their their algorithm, their LMMs, and eventually drove a significant amount of performance for advertisers. Everyone else is building their ad business, they're going to catch up. We think this whole like the algorithm side of things is going to be commoditized. Everyone's going to tap into those same models.
Brett (20:47.884)
Yeah.
Alex Merutka (20:50.42)
The differences is the data that you put into it. So if you're more scaled like Google, Meta, Apple, then you more data, so that'll make your machine smarter and you know perform better in theory. the other piece is the creative side, which we think is like the easiest, lowest hanging fruit, and where we've leaned in our business for is there's a couple of problems with creative. One is trying to actually make it engaging and clickable. Like when we started the business, we we simplified it as.
Brett (20:52.962)
Yeah.
Alex Merutka (21:16.522)
You know, when I would talk to people and say, I work at AppLeavin in advertising, back then AppLovin wasn't pool. It was kind of like a weird name and and people are like, you put ads on my phones? You're super Yeah, and I was like the annoying person putting ads on their phone. They're like, they hated me. Like I'd meet random people at a bar and they're like, you're the guy who puts ads on our phone. And I was like, you know
Rio (21:26.173)
Yeah, no no no one heard of Applevin back then. Yeah. No disagreement. Yeah.
Brett (21:32.044)
Yeah.
Brett (21:35.915)
Yeah, like th the intergame experience of just an ad for another game or another app, right?
Alex Merutka (21:40.675)
And I'm not saying ads is like sexy now, but App Lovin had like no street cred back then. I was getting no props from anyone when I was signing my work in advertising. and so I realized that a lot of people hate ads typically. Like people don't like ads. and so I was like, what do what do people like? Typically, people like games. So what if we can make a a creative business that takes things someone hates, like ads, and turns it into games? And that solves the engagement piece because you're a lot more likely to kick click on a game than click on an ad.
Like you're you're more you're likely more gonna play a game than like just watch a video and and watch an advertisement. So that was kind of part of these this is gun.
Rio (22:16.639)
Hey, Alex, quick question before before you go to the next one. Like I'm just curious, like Applevin is such a polarizing company, right? So I you know, I've we written a couple articles, like I think when they became the biggest ad tech company, we wrote one. And I I even had a it's interesting, I had a bunch of analysts call me up to ask me because I say, I don't know anything about Applevin. I just wrote an article based on like what I'm reading on the internet about, you know, and then but it's there's all there's a bunch of short sellers who have been disparaging them. And like I remember even even you bring them up at an ad tech meeting, people have very like
polarized opinions on it. Why do think that is?
Alex Merutka (22:47.542)
I mean tons of reasons. One, at like the culture at App Lovin' is like very matter of fact and intense. It's like no bullshit. This is the right answer. If you guys don't d do it this way, you're doing it wrong. It's not like
Brett (22:58.891)
Yeah. It it kinda sounds very similar to Amazon, right? don't they don't they talk about then Amazon culture of that sort of bro culture from Amazon that was a bit off putting, right? That not not saying all of Amazon, but that was
Alex Merutka (23:09.844)
Yeah. I I think it's this sense of like I think app loving folks are super smart. I think there's a culture that comes off that you know, they in in their minds like this is the way you do it. Most vendors don't take that position. Most vendors are more like, you know, they they f they're flexible to the client. They'll walk into an agency, they'll bring them macarons, they'll do a presentation over lunch, they'll be, you know, if someone says, we don't like to do it that way, they'll kind of be like, well, let's try it this way.
Brett (23:28.226)
Yeah.
Alex Merutka (23:38.44)
App Levin will just go, Well, you guys are stupid. You should be doing it this way. And people don't like being called stupid. So I think one thing is like it's a culture thing that app leven is just very direct matter of fact. And they're like, the answer is A. If you guys don't think it's A, then you're doing it wrong. And we like
Brett (23:41.762)
Yeah.
Yeah.
Brett (23:52.948)
well either either that or it's just they're missing a e they're missing EQ. They got a lot of IQ, but they're missing EQ and that that can result in some interpersonal challenges with other
Alex Merutka (24:02.049)
We we had a small when I was there, we we we had a super small sales team. So it's not like we had like a team of a hundred sales reps. It was like me and two other guys doing it and we were bringing in three billion dollars year in ad spend with three people. Like it was tiny. Yeah, and and you know, it was very much a tech first company, like everything tech first. And and I'm actually more of like a people first type leader and and this is why I kind of hung out with the creative team a lot at Apple and everyone was asking me like
Brett (24:14.071)
Yeah, that's insane.
Brett (24:18.977)
Yeah.
Brett (24:27.583)
Yeah. You can tell. I can tell just by talking to you. I bet you know, not not that not that you're not technical, but just the way that you
Alex Merutka (24:30.803)
Yeah, I I like people.
Brett (24:34.153)
interact because there can be a bit of a matter when you're when you're an SME with deep product knowledge, not all product leaders, but there can be sort of a matter of factness, you know, sort of a the smartest person in the room type of mentality. And I think as people, you know, when you're 20 something starting a new company, as you good kind of move through your career, you know, and I've known a lot of people that were complete dicks early in their career, came walked into the room, you know, throwing their weight around as the smartest person in the room. Yeah, and and then they get
Rio (25:01.439)
And light lightened up later probably, right?
Brett (25:04.057)
They they they descend from the mountaintop at some point or another in their lives, right? Something something broke interpersonally, organizationally in the business, and they and they figured things out. They went and did a Buddhist retreat, whatever.
Rio (25:15.625)
Brett, but sometimes it's just mature maturing is funny. So I I'm a New Yorker, right? And I moved out to Colorado and I actually worked for a company based in Seattle for a while. And funny, when I my first year, because there's just intensity that comes with New York companies, right? I mean, I remember my first job getting yelled at. I remember my boss called me a piece of called me a piece of shit. I was like, my God. I remember almost I wanted to cry. Like I didn't know I got treated this way, right? This is agency life back, you know, twenty-five years ago, right? Which doesn't seem not long ago, but like New York, that was just kind of normal, right? And there was the stress of these
Brett (25:40.055)
Yeah.
Rio (25:44.34)
So it was tough, right? But I remember I moved I you know working for a West Coast company and I remember like they were like, You dude, you can't talk to people. I wasn't cursing at people, but you can't let you can't tell people the work is trash. You can't I was like, Well that was con that's consulting. They would rev a partner would review review the deck and tell me this is garbage, redo it, right? So like you can't treat people that way. So some of it I think might just be maturing as a person and understanding you know that there are better better
Brett (26:06.603)
Yeah.
And don't don't take New York that bad, although although I've got I one story before we move on, because it's a funny one though. So my first experience ever in New York City, walking into a retail store right out of college, like you were, Alex, you know, when you when you took the Apple Evan job or before that. and and I walked into I was I was sleeping on Westforth and McDougall and a second floor, cockroach-infested apartment, right across from the Blue Note, you know, college friends before I found my own place, and I walked downstairs being a super music aficionado and an album collector.
I walked into Bleaker Bob's, which has appeared in some comedy shows, like the Louis C.K. comedy show. Like you see him go by the con the to the comedy cellar and he walks right by that record store, pizza shop on the corner. And I walk in there and I'm doing what you do in record stores. I'm flipping through some albums, you know, checking things out. I'm their best future customer because I'm gonna keep coming back and I'm gonna continue to to look at this stuff and eventually buy when I had some, you know, when I have some money. And I didn't buy anything. I walked out and on my first step down the stairs.
This guy, Bleaker of Bleaker Bob, Bla or Bob of Bleaker Bob's, goes, You ain't gonna buy anything, you bum? Get the fuck out of here! That was like, that was my first retail experience in New York City. So, I thought like is this is
Alex Merutka (27:21.609)
Welcome welcome to New York. I I love well like well like New York's the only city that like says that sarcastically to folks and just like, Yeah, well well well welcome to New York.
Brett (27:29.112)
I know.
Rio (27:30.122)
Yeah. Well well Well how s okay, so I know I know we wanted to move on, but like what like I w I remember right f early on, like when but Alex before like one little quick thing. I remember early on in New York, there's a pizza place downtown right by by Broad Street. I remember this my first week in New York, like a guy flicked the money at the guy behind the counter, Vinny, and he said, Y get out of here, you ban for life, you bum and he yelled at the guy and he and the guy was like I
Brett (27:31.625)
Yeah, yeah, and I don't think I think it gets a bad rap, despite that experience having lived here for twenty six years, I think it does get a bad rap. Sorry.
Rio (27:59.07)
What you mean? He's no, you're actually you're banned for life. Get out of my pizza shop. You're never coming in again. I like, This is this is kinda like a Seinfeld episode. So so so so sor so sorry, Alex keep keep going.
Brett (28:04.798)
Yeah, totally, totally.
Alex Merutka (28:08.085)
Well, I I was gonna say that, yeah, even though it's a apploving is very matter of fact, but if if someone says something smarter than them, they listen. So my first meeting with Adam and all the execs, I remember he brought me into a room to talk about it was actually funny, it was a it was a creative idea actually, like my first like second week on the job. And we were trying to solve this problem and I'm like the youngest guy in the room and you know, he's like, Hey, what does everyone think about this direction? And I raised my hand and said, Well, actually I
Think we should the other way. Here's what I would do. Here's what I was kind of building at the other company I was at that that got totally overlooked. And they just told me to put my head down. But I actually spoke up in this meeting and one of the other, you know, folks tried to like dismiss it and be no, no, no, we're going this way. And Adam said, wait, wait, what'd you say? What was that idea? that's awesome. Take some engineers and go build that. That's a great idea. Let's go do it that way instead. So yeah, so that's what Adam did a lot for folks. That if if you had a better idea than what was currently going on, he would just give you resources and you'd go build it.
Brett (28:55.552)
That's empowering.
Rio (28:56.863)
That's cool.
Alex Merutka (29:05.267)
Which was amazing for someone who was starting their career who was curious and wanted to learn. So I think, you know, e yes, their culture is very matter of fact. but and and it can be a little intense. Like they're I mean, if you meet Adam, you he talks fast, he's quick, he's he's he's an intense guy. But if you challenge him and you beat him on something, he'll admit it and pivot quick. He goes, yeah, you're right, cool, we're moving. Pivot, go.
so it's not like it's not like ego's trapped in there a lot. It's more just they want to solve the answer. And instead of playing the normal like you know, dance with these types of advertisers, they kind of just cut cut through all that and just go in super direct. So I think that's like one reason. Yeah. Yeah, it's culture.
Rio (29:45.588)
Yeah. So you think part of its so you think part of its culture? It's interesting too. Like everyone I know who's worked with him has great things to say. Like a you know like a I I talk I know I know a friend of mine. Yeah, I know a friend of mine. He he worked he he knows him from grad school actually. And you say he's a he's he's one of the best dudes you'll ever work with. and and you're saying similar things. So but it's funny, so but yeah, there are a lot of there's a lot a lot of negativity and I think some of it's not understanding mobile as well, too.
Alex Merutka (29:53.727)
Super smart, yeah. The whole team.
Alex Merutka (30:01.427)
Yes.
Brett (30:09.388)
Yeah.
Alex Merutka (30:09.576)
I think that and I think also like when they launched their gaming business, they got a ton of backlash, right? Because you know they basically, you know, they built an ad business where they took in all this data and purchased data from all these gaming companies of saying, Hey, we're gonna optimize towards people that buy, you know, coins in your game. And we have all this data around your users. and by the way, we're gonna launch a company that is gonna potentially compete with you guys, and we actually know all your payers. We know every single user that's ever downloaded your app.
but it and that's a little scary as a as an advertiser, like if you're if you're a gaming publisher and the c like you're working with an ad tech platform that has data on your audience plus all your competitors' audiences, and then they're launching games to compete for attention.
Brett (30:39.414)
Yeah.
Brett (30:53.621)
It it se it seems like it kinda they probably feared as like IP theft. Like this is part of our intellectual property, like in terms of understanding exactly what our users are doing and how they buy and pay, right? So I'm assuming there was a little bit of that
Rio (31:04.457)
Plus the grading your own homework aspect to it as well. I can see why that would that would raise some alarm bells.
Alex Merutka (31:07.924)
Totally. And you're you're buying you're buying on your own platform. You could just take no margin on your account, you know, and you don't want to charge yourself money, right? You could do a lot of things. Not saying they did that, but obviously advertisers know they could do that. They could steal all the data. They could go do and make their ads more competitive. So it just I think that made people feel uneasy. And ultimately I think it was a great idea when they they sold the business and and they got that part off of it. And, you know, like did it train its models? Yeah. They basically had a bunch of gaming businesses that could
Brett (31:08.012)
Yeah.
Brett (31:35.585)
They they sold the gaming production business? Yeah. Yeah.
Rio (31:38.015)
You spun it off, right?
Alex Merutka (31:38.077)
Yeah, they sold the gaming production business. Yeah. But they had they had they'd really chained their model on, hey, this is the really in-depth. Like on mobile and the signal, you're getting like, did you click on an ad? Did you download something? Did you buy something? And how often are you buying? And how often are you opening the app? Those are kind of like the the pings and fires you get. App Loving, because they own their own game business, they could get a lot deeper signal in how users behave in games and then help that train their axon model to be better at advertising for their
Advertisers. Once they got rid of the ad business, that took away that conflict. So that definitely helped. Rio, I think the other contentious point is that you know, App Levin owns like they own mobile advertising. You like any app you go into, 75 to 80% of the inventory is running through Max. They're they're they own the auction house. So anytime an ad request happens in mobile, it like 70 plus percent of the time, maybe over 80, is running through apple in the auction house.
And they're it's like running an auction where they also sit in the auction to bid on it themselves. So yeah, most most of the time you go to an auction, yeah.
Brett (32:39.947)
Yeah. No and is it Yeah, isn't isn't that where a lot of the contention of like this this meteor meteoric growth is like it's sort of like they're bidding against themselves. They're controlling in to in that entire system, which was a bit contentious. Yeah.
Rio (32:49.231)
Or and then in the related the related party advertising too, where it's like you see an ad for one and it leads back to add to another. I th those are some of the criticisms as well, like early on.
Brett (32:59.083)
Yeah. And d do you think brands had like a natural let's say just typical brands, non-mobile publisher brands, right? Had a bit of distrust on this performance sort of direct response. Probably a lot of these ads are incentivized, you know, like sign up for the game today, get the app to the game and we're gonna give you X amount of coins or X amount of this or that, right? So it's it has a direct response, and tell me if I'm wrong, kind of aspect to it. Do you think brands
Alex Merutka (33:23.048)
It's more more on the view. Yeah. So I don't think that's the issue with brands. I think they've gotten over that like rewarded system. So they're not rewarding you to take actions typically. It's more it's it's rewarding for watching a video. So hey, watch this video, opt in to watch a video, you're gonna get ten coins. You don't have to do anything on the video, but you have to you have to watch it. In the game you're playing, yeah.
Brett (33:29.014)
Yeah.
Brett (33:38.72)
Yeah, yeah. In the game that you're playing. Yeah. Yeah. No, and I guess my question was I was trying to get to the point of of do you think brands think this would work for them? I'm PNG or I'm, you know, whatever the brand might be, I'm Chick-fil-A, right? Will this type of advertising, which is advertising games to people that are playing games, work outside of that narrow ecosystem? Right? Do you think there was some some and and why do you think it should or could work outside of games advertising to games?
Alex Merutka (34:05.352)
Yeah. Well, here's the reason why it hasn't worked so far for Applevin specifically. One is Apple doesn't hire sales guys that go to big agencies and like sit on their door all day. And you need to do that to win agency business. And app appleven has not typically like jumped it to like beg for agency business. They just haven't done that. Most vendors do. They're taking them out, they're doing games, they're whining and dining. Like the agency world, you gotta smooze. The app eleven group's not good smoozers. They don't care about that. They're like performance only, use us or
Rio (34:34.141)
Yeah, they they were like it they're they they don't hang out a can, they don't have a yacht, they're not spending t you're right. I think most agency yeah, most agency people, you're right, probably don't I think some of them don't even know much about them.
Alex Merutka (34:34.557)
Or, you know, get lost.
Brett (34:34.721)
Yeah.
Alex Merutka (34:37.716)
Correct. They're not doing any of that. So
Yeah, they don't they don't know There's no relationship. There's no schmoozing. It's just performance. So they don't do the schmooze game. That's one reason why they don't have it. The second is that app lovens a blacklist. Like you it's a black box. You can't actually see what publishers you run on. So if you're a sensitive publisher and there's some wacky apps out there, right? Like, you know, a lot of these app developers are like nineteen year olds sit like making apps in their mom's basement and they're just turning out apps and you don't really know like where these ads are running because it's it's a
Brett (35:10.423)
But your s your slip was funny. You said AppLovin is a blacklist. I think that that's what it satellite for a second, but no. But they they it's a black box in the sense that they don't know which w I just thought that was a kind of a curious slip. Yeah.
Alex Merutka (35:15.87)
Yeah, like like
Rio (35:18.911)
Fox, yeah.
Alex Merutka (35:22.322)
So yeah, brands brands want to know where they're running. Like if you don't if you don't at double verify, for example, like if you don't have double verify in some brands are like, we won't run unless double verify certified. Appleven's not double verify certified. So like some of those bigger brands just won't run unless it's double verify or they know where they're running because they're super brand safe. that being said,
Brett (35:27.916)
Yeah.
Brett (35:34.348)
Yeah.
Brett (35:42.85)
Yeah. And does that does that
Does that narrow the type of brands they can, you know, because you're you're talking direct response advertising only, really. I mean performance advertising only. You know, you could make the argument now that performance argument advertising is good for certain categories, but once you start to go into broader industry categories, that it has to include brand awareness building, halo effect category building, awareness generation. And and are they saying we're not gonna go down that path? We're not gonna leverage mobile for awareness building and all the other metrics.
Rio (35:52.359)
Or below the line, yeah.
Rio (36:15.913)
But Brad, you remember the argument from last week, you know, w with with Brian Quinn from S far. He he was even saying that mobile is performance. Performance is mobile. I mean like there that like it's like like I'm not saying there's no brand or upper funnel, but like it's mostly performance. And this is where p all these performance technique techniques are pioneered and honed is mobile.
Brett (36:22.358)
Yeah.
Brett (36:33.462)
Yeah.
Alex Merutka (36:33.715)
Well, that's why I think App Love In, I yeah, App Lovin''s pure performance. So yeah, they don't really care about the brand stuff yet, but they bought World C T V, right? And C T V hot right now and it's performing well from a brand and from an actually like a tributal perspective of of driving performance. CTV is doing incredibly well for folks. So I think they're gonna that'll I think those two formats are gonna be the leading formats. Like you're gonna see C T V and mobile. Basically, those are the two screens that people are gonna be using to drive outcomes on the in the advertising.
Brett (36:38.753)
Yeah.
Brett (36:42.764)
Yeah.
Brett (36:51.457)
Yeah yeah, for sure.
Brett (37:03.489)
Yeah, and at the consumer level, they're so interconnected. I mean, whether it's whether you're you're pushing something one or you're multi you know to from one screen to the other, or if you're just multitasking, they're they tend to be concurrent devices, right? You have a television, you have a phone, they're they're you know, you look at your own behavior. So for me
Alex Merutka (37:20.667)
And if you can use the the television for more branding in the big screen, right? Big screen, big impact on brand, and then performance for like in your hand clickable to go download to go buy, I think that makes sense.
Brett (37:26.667)
Yeah.
Brett (37:32.235)
Yep. Yep. That's interesting. So so so for your from your perspective when it comes to creative and and and what you guys are doing in that area, I mean what do you think where do you think the the the performance actually comes from? I mean is it a form like are you testing things like format, interaction design, offer, CTA, production quality, all these kind of metrics that go into this? I mean how how how have you guys or you architected that?
Alex Merutka (37:52.551)
Yeah, all those, yeah. Yeah.
Yeah, those are all table stakes. yes to all that. but yeah, kind of going back to what I was saying, the two things one is gamification. Like if you can make ads fun and engaging, then people will drive clicks and and ultimately get into that ad funnel. And the second is the closed loop ecosystem, which I think so many people have just built their ad businesses. They've all launched an ad business, they're just getting up of like starting to serve those ads. A lot of these guys are trying to go into performance. So you look at companies like Reddit, Discord,
All these newer ad businesses, they're trying to make performance work. They're trying to get away from pure brand play and getting into a performance mindset. All these companies are Netflix, OpenAI, you look at all these businesses, they're all trying to crack performance. And the way you're gonna crack performance is you're gonna have you're gonna have to have as much data as Meta, Google, and Apple and to funnel into your to your algorithm. But you know, we think that all these algorithms are gonna be commoditized, they're all gonna be like the same level of algorithm, but you're gonna need different data points, more data, better, obviously.
Brett (38:28.609)
Yeah. Yeah.
Alex Merutka (38:54.769)
And then you're gonna need creative to be a piece of that. So if you have a human element to put like the human instinct into that creative, and then have AI be able to like produce, create, build, iterate, optimize, do all those tests that you just mentioned, plug back into an algorithm, and then immediately say, let's push different changes. So you get this closed loop ecosystem of creative, what happens on it, what does it perform, push into an algorithm, and then deploy the creative again. What we see in like our sweet spot, like
The thing that we think is the most underrated and like kind of overlooked piece of mobile advertising right now is pre-click data. So what I mean by pre-click data is everyone right now is optimizing towards click data. Like did you click on add A or B? And then they're optimizing towards post-click data, which is did add A or B drive an install, a subscription, or it purchases? Like you're usually optimizing towards those things. So no one's looking at how did the user actually get into that click?
Like when you're watching a video ad, you don't really know what drove the click on a video. You just watched a 30-second video, but you don't know. The video could be about, you know, lions, dolphins, and whales. And you don't actually know why you clicked on the video. You just know lions, dolphins, and whales. Video A. But if you're looking at actually pre-click data and you could track that actually the line is what drove it for you, Brett. Rio, clearly dolphin guy, and me coming in as the whale, like
Brett (40:20.172)
Yeah, that's a good
Alex Merutka (40:22.064)
Then then then then we all know we all clicked on add A, but for different reasons.
Brett (40:26.634)
And is that c is that that so that would be contextual data being passed within the mobile like like here, what did I interact with before? Now without cookies, can you just explain to the audience like how do you how are you actually following people from A to B to C? And then I think as part of that Indian loop, connecting the dot, especially if it's out of the ecosystem you're in, right, to the point of sale, to the point of conversion. So I go out and I I subscribe to Netflix, I I become a new subscriber to Netflix, but I'm now outside of the app that I was in. how are you actually connecting those things?
Rio (40:28.979)
Contextual data, yeah.
Brett (40:56.568)
to resolve the kind of the attribution event that's happened.
Alex Merutka (41:00.144)
Yeah, so there's a ton of like I mean, again, you guys just had Brian, so you got like App Slier and companies like that. You also have like the way AppLevin's doing it with like an actual pixel to track. But the main thing happening right now is that you know the whole digital advertising space is losing signal. So like obviously ATT and Apple changes, like massive signal loss. you're looking at the new California law they're pushing, you like removing even more like behavioral signals. Meta doesn't target, you know, do behavioral for under 18. Austria, I think Australia, Spain.
Brett (41:05.589)
Yeah.
Yeah.
Brett (41:15.336)
Yep. Totally.
Alex Merutka (41:30.182)
All these countries, everything's getting more and more regulated, which means less signal for advertisers. So our thesis is that instead of trying to, you know, everyone keeps complaining about signal loss, it's like, okay, well, what can you control? You can control creative and you can capture a bunch of signal on the creative itself. So before you couldn't, you were just capturing clicks and post-click data. Now you can actually capture what are users doing on this ad? What's so interesting about that? How can you learn from this? And then plug that back into an
An algorithm. So a lot of our businesses actually we we work with a lot of the big advertisers, but we also work with a lot of the big ad tech companies. So we actually are the platform that we license our technology to add businesses. So you said, you know, you had Ackerman on on, you know, digital turbine licenses our software. Like they use us as their creative infrastructure to build their clients creative on our platform. So we base we we go to all these ad businesses and license our tech to them. Correct.
Brett (42:17.448)
Okay. Yeah.
Yeah.
Yeah, 'cause they they do the ad distribution and you guys are actually providing the creative that feeds into that to serve into that system. Yeah.
Alex Merutka (42:30.51)
Exactly. So there's kind of like you know, the the ultimate loop is having kind of two brains in the system that talk to each other. So they have the distribution brain of why Rio gets one ad for basketball and Brett, you get an ad for football. They're making that ad decisioning there. On our side, the creative brain is determining, well, Rio, we're, you know, based on these pre click data and signals on Rio, let's do ads more like XYZ in this dynamic creative component. Like
When you think about DCO and dynamic creative optimization and it's a great example right now, the World Cup. you know, if you're you you can see like companies like the prediction markets like Polymarket and Cal She and all those sports fighting guys, they're blasting spend.
Brett (43:12.95)
Cal I mean that is is that is that the best fucking ad of it the the Timothy Chalamet Hi He's got you know he's be he's at the operating table with the thing over his mouth. I mean and and it's funny 'cause I didn't know what Calci was until I saw that Timothy Chalamet ad where he's at the operating table and then the doctor's trying to interpret it like what he's saying. Cal cal Cal she? What'd she say? You know. I I just thought very effective advertising and then immediately I knew what they were and now it's it's seared into my brain speaking about the value of brand advertising. Right?
Alex Merutka (43:40.531)
And you're probably seeing a lot more mobile ads and like so yeah, you get that big brand spot to like capture attention and then on mobile what they're doing is actually pulling in live sp like sports betting odds into their ads. So like when Trump overturned the red card and and let the US team player play, all of a sudden the odds changed for the US, even though we still lost. But you know, like the odds changed and the sports betting odds changed.
Brett (43:55.755)
Yeah.
Rio (44:02.641)
And and and they were putting that into their ads themselves, the updated odds on these on specific
Alex Merutka (44:06.236)
Dynamically. So it's creative is becoming more of a living thing versus a static or flat video. So instead of having to it's it's it's timing, right? It's like customers want updated stuff. Like how frustrating is it when you go on Google and a store says it's open and then it actually is closed and it's like not updated information or like a road's closed and it's not been updated in real time. And as a user, you're frustrated. You're like, hey, I was told this and it's not that.
Brett (44:12.01)
That that's a that's critically important. Yeah, yeah.
Rio (44:23.549)
a
Brett (44:23.978)
The g the g yeah.
Brett (44:29.045)
Yeah.
That was that was the YXT business model, right? The the the online I worked for a startup that competed with YX called Sign Up that didn't thrive too well in or survive they survived, but they barely made it through co through the COVID period 'cause it was all very local. But it was exactly that. It's like you look at something, business business closed or business it says business open and then you you drive for an hour and you arrive at the business and it's closed. That was actually what drove the CEO to found the business. But super important to have it's that con it's a context, context, relevant real time context,
Alex Merutka (44:59.58)
Real time. Yeah. Relevant real time.
Brett (45:00.672)
Yeah.
Rio (45:01.513)
Yeah. Well Alex, looking at role of creatives, I mean over the years there's been a several times where everyone was pushing DCO, it's gonna change everything and and like create actually ha building a creative, getting it approved and just getting it out was always super challenging, right? So it's always been seems like that was that was the the roadblock was creative itself. So is AI unlocking that to a certain extent? And and and what you just described is really amazing. Be able to actually personalize, have real time, use contextual signals, that would that would unlock
I I would think a lot of performance advertising would it it would create more more ways you could leverage creative for to improve your performance advertising, I guess is what I was trying to say. Thoughts thoughts on that?
Alex Merutka (45:42.316)
Way the way we think about it, especially with bigger brands that are very brand safe, is creating like in our platform, they can go in and create their own template that says like this template is approved from a brand perspective and guidelines. And then we're just swapping in certain elements in there. So this is always gets approved. So it's always on and it's an evergreen concept. With AI, one, those iterations in the feedback loop to make asset swaps can happen really quickly. You can create a brand agent to go look at
Does this meet all my brand guidelines? If there's any sort of flag, like even a 10% flag, flag it and let's have a human go in there and make sure, you know, you don't have a double handlebar bike like the REI ad that was run on Meta's Gen AI creative platform that had two kind of bike handlebars on opposite sides and they kind of did they just went full Gen AI. So when we think that we kind of think of AI in two buckets, at least creative AI. There's one that's just built on the existing L and Ms that you just like slap something on top of just to go for volume.
Which a lot of companies are doing right now. And I think that solves a lot of problems for S and B clients that don't care so much about brand safety. That they're they're like, they don't have money to compete with the bigger brands. like if you're trying to compete against Nike, you're going to lose. Like they have bigger brand and they have more budget to do, you know, more creative and outspend you. Yeah. So you you there's like how do you compete with them? Well, now with AI, you can actually start competing a little bit. You can build super niche products that are very specific to someone like.
Brett (46:42.825)
Yeah.
Rio (46:54.857)
Do whatever they want, yeah.
Alex Merutka (47:05.785)
Rio, your specific needs so detailed into what Rio wants. And then you can have, you could build a product that actually fits that need. You can have AI learn you on the platforms, digital platforms to go find you. And then you can match it with the exact creative that Rio needs to convert and looking at all those signals from pre-click, click, and post-click data to get Rio to convert on that. So you can actually start shipping away at the larger companies now, which is which is awesome. Like obviously I'm an entrepreneur. I like people to win against.
Brett (47:07.55)
Yeah. Yep.
Brett (47:30.336)
Yeah. It yeah it's the the power of micro targeting and then the bu and then the and then the shortening of product development, even hard hard products, not just software.
Alex Merutka (47:37.915)
Totally.
Brett (47:38.744)
product life cycles is diminished, right? Where you can create these things quickly and you can have a micro target. The pharmaceutical industry sort of does this at scale. They're like, we've got a we've we're certain we talked to a f ton of people that can't, we've got a an audience of five million people that have this very rare condition. And we're gonna find and target and speak to those five million people and the doctors that actually serve those specific use cases. Which you couldn't do that in the past quite to the degree you can do it now.
Rio (47:59.518)
Yeah. Well if pharma's well Br farma's an interesting case because I you know I I've been working in industry for a while. It used to be that you you needed to submit every single advertisement to the FDA after you actually create after gone through your medical legal regulatory review, you had to submit every every variant, Brett. Like like if you had ten variants. So because of that, these farmer these pharma marketers just said we're it's not worth the juice is not worth the squeeze. But I think that changes now. Now the FDA, you can give them a business rules, you can give them your template, you can say here are the different variants.
They'll accept that. And you can so I actually actually think the rules have permitted this for a while, but until AI it wasn't possible to actually execute a lot of this hyper hyper personalization, which you can now do to your point, Alex.
Alex Merutka (48:40.017)
Even even with like so the larger brands though, because that's the that's one side of AI is like volume, get it out, you know, build on existing LMMs and plug in and build a UI on top and just start blasting out different like variations and and concepts that way. That doesn't work for a lot of large advertiser, like AAA gaming studios, no chance. obviously, REI had that slip-up that I kind of mentioned with with Meta's gen AI capabilities. So it if you're doing full gen AI,
Rio (49:04.991)
Remember that?
Brett (49:06.921)
What what was the slip up specifically? You mentioned I I
Alex Merutka (49:09.263)
yeah. I think Business Insider read an article on it. But if you yeah, if you Google REI like Business Insider, you'll see that they have there's a bike ad that had two handlebars on both sides going the opposite way. And it's like it's just like very clear.
Brett (49:14.559)
I think I
Rio (49:20.861)
And there was a there was a grandmother there was a grandmother wearing like a a a quarter zip, right? Which she never a grandmother would never wear it, but it had like the zipper in two spaces. It did obviously no one would manufacture. It looked it looked it looked terrible.
Alex Merutka (49:26.117)
Yeah, exactly. Yeah.
Is correct. So this is full gen AI and this is meta, right? They're hiring those kids for a hundred million bucks and they're still messing this stuff up, right? So
Brett (49:37.567)
Yeah. Yeah. And and when there's been a lot of complaints, like I that that example and I think just from the advertising community around around just stuff that's coming out of it that slips and misses in a lot of different ways that people just know that it's kind of AI slop. Yeah. Yeah.
Alex Merutka (49:43.544)
Yeah.
Alex Merutka (49:49.221)
Yeah. There's a lot of slop, but yeah, exactly. There's there's a lot of this slop coming out. So we we kind of see it as two buckets of one is just like get stuff out quick and in SMB, you you don't have the ability to complain about slop because you just need you just need assets for super cheap and you're okay with that trade-off. the bigger advertisers, they definitely care, right? Like Nike would never want their they would never want them being in that article.
Brett (50:05.354)
So
Brett (50:12.627)
Yeah, that that's a brand control and brand governance. And I'd love it, I mean, how are you guys managing some of that internally within your platform? And then I and then I've got another question about context that I think we should dig into, but but how are you guys managing sort of the the governance and control to ensure that you're you're appealing not only to the S and Bs, but also to the mid market and larger brands that are a lot more sensitive about things going wrong within their creative?
Alex Merutka (50:35.685)
Yep. So our whole idea was basically like when when I left AppLevin and Adam told me there's only one billion dollar company, it's called Adobe. My idea was like, I want to rebuild Adobe, but specifically performance advertisers. So I want to rebuild their editor and builder, but made for advertising first. Like, you know, when you look at a company like Unity, they built a game engine first and then slapped in ads. Whereas AppLovin built a gaming business an advertising business first, and they're like, We're gonna do advertising, we're an advertising company, that's all they do. That's their focus.
Brett (50:51.53)
Yeah.
Brett (51:03.881)
Yeah.
Alex Merutka (51:05.307)
There's difference when you have that much intentionality behind something. So I wanted to go super deep of like, let's build a creative platform that's built for at performance advertisers. And when you do it that way.
Rio (51:13.983)
Well Adobe, by the way, has really really struggled with with I think ad tech, with advertising. It's like you know yeah. Everything they've acquired is they've struggled to bring them to market. They've not priced them correctly. The market share's pretty low.
Alex Merutka (51:18.353)
Totally. Two mogul all the s yeah.
Brett (51:23.263)
Yeah, and and
Figma's a super valuable company from a you know, but but you're right. I mean and I and you talk to creative designers, directors who I deal talk talk to a lot of them, and they're like, Well, it's not quite here yet because they're in those tools. Like in terms of their ability to version and to get to kind of translate their kind of all their brand guidelines, all their creative guide guidelines that they've built out for an organization, B to B or B to C, to translate it that into everything we're talking about, whether it's a PowerPoint, ad versions, content, whatever. They
still feel that there's gaps there, right? Is what I've is what I've learned.
Alex Merutka (51:56.581)
Yeah, and and there's a lot of gaps out there. the way we do it is so we built for seven years, we're building our our editor, essentially, like a a a game engine slash editor to be able to go produce these ads with technology. And and the reason why we did an editor is because we wanted full control. Like we wanted to be able to like if Nike's logging into our platform and using us, they need to make sure that they can have entire hundred percent control of the creative.
So when you look at full Gene I businesses, there's no control. You like prompt it something, it spits out an in an ad for you. And then to try to adjust that ad, you just have to reprompt it and hope you get lucky. It's like a lottery machine. You're like sitting in a slot machine, like hoping to get the right one. That is exactly what you want. And when you think about like Fortnite and and Call of Duty and Grand Theft Auto, like they're not gonna be pulling a slot machine a hundred times hoping they get right.
Brett (52:36.081)
Yeah, yeah, totally. Totally.
Alex Merutka (52:49.882)
They want exact control. Creative people love control. If you ever like hang out with creative folks, the the artists, designers, they're like, it has to be this way. This this pixel perfect. It needs to be like this. And that that still exists. Yeah. There's total like creative control at these brands, is is still, it's even at a more all-time high because of all the AI slop out there. So our platform, you can go in and prompt it. We we have we have a built a natively into the platform. You can go in and prompt it and say,
Brett (52:52.733)
Yeah, totally.
Brett (52:59.448)
yeah, a hundred percent.
Alex Merutka (53:14.788)
You know, hey, I'm I'm running an ad, I'm running it on Meta and AppLovin. I'm in this category, this vertical. Here's my here's my link to my app, or here's my ecom website. What sort of ad should I build? And it'll give you all this information on what you should build. And then you can say, go build it for me, and it'll go build it. But once the AI actually gen creates this build for you, it's in our editor. So you can move things pixel perfect, adjust swap. It's all done in the editor.
Which is like like a massive advantage when you come into the whole AI world of folks just building on top of other LMMs, where we're building on top of our editor and our game engine.
Brett (53:50.813)
And i and y and you're satisfying that that that very sophisticated designer that's got
Rio (53:55.104)
Well it's a tool d sound like it's tool built for designers and creatives.
Alex Merutka (53:56.026)
Correct.
Exactly. It it was it was built like how do we have performance marketers, but ultimately the users are gonna be designers. And then some a a lot of these roles designed in in marketing, like UA marketers, they're kind of merging because as media buying's gotten easier in terms of like you don't have to have as many hands on keyboard to like adjusting. And when I say easier, I just mean like
hands on keyboard to make those adjustments and do those manual changes. You don't really do that as much anymore. You you plug in a meta Google, you set your target, you let the campaigns go. You got to do a bunch of other stuff now that the job roles changed. And a lot of that changes in the creative space. So you're seeing a lot of UA marketers lean into creative more. that obviously they're they're a little less protective around control, but the brands themselves are still very like brand heavy and and that's how you're gonna differentiate yourself in this world. Like
With AI, you you could build any company and product really quickly now and spin it out. But if you don't have a brand attached to it, it's gonna be really hard to get users to actually wanna engage in it. So brands becoming way more valuable now with AI in place.
Brett (54:58.569)
The
Rio (54:58.931)
How do you see AI impact any creative teams? Are they are they just integrated into existing teams? Is it changing team structure? Is it changing people who are actually using creative? Like what what are you seeing so far?
Alex Merutka (55:07.332)
Yeah.
Yeah, I mean on our on our product and dev side, what we saw is that like UIUX, there's usually like UIUX, there's someone like prototype and build something. There's the product manager who's trying to tell everyone what we should be building and and how it should kind of look. And then the engineer actually goes and builds it. Well, now you have AI to one help a lot with the design side. So you can basically of those three roles, what we've done is kind of merged them into one and basically just gave our whole team the opportunity to say,
Look, you don't need to just stay in your lane now. You can actually do all three things. If you're a UI UX person, but you have this right attitude and mindset of growth and you want to learn, you could actually go build out your whole prototype yourself. Like you could design it the way you want. You could use the I to help you accelerate that, or you could do it yourself manually. And then you could go have the idea of product if you're an ideas person and a product like you, you, you know, you're a visionary, you have an idea, you could go build it, you have the idea, and then you can have the code base actually build you out the whole dev side of things.
Brett (56:05.417)
Yeah.
Alex Merutka (56:05.601)
And same with developers. Like our developers, basically what we've seen AI do is for some people, it's increase like on the low end, it's like a 50% increase in productivity. On the high end, it's it's like a hundred X type of multiple. And and for like our best team players, it's like a 10 to 100 X on in terms of like what they're able to do. Yeah, because you we have a we we have some really good developers at a company that now they can we can directly show them the impact what they're
Brett (56:18.762)
Yeah, yeah, yeah.
Brett (56:23.922)
Somewhere between that.
Alex Merutka (56:33.219)
features and what they're pushing has on the business. And we're showing them, okay, we've kind of rolled up revenue and product under one person the org so they can all see the direct impact of revenue and usage that they're seeing and and doing. But a developer now can say, hey, I have a really good idea. I already prototyped it. Here's what it should look like, get feedback from someone, maybe like one of the PMs on it, and then just go push it himself and and be able to write all the code himself without having to like manage five people underneath him to do it. So it's really
Brett (57:00.842)
Yeah.
Alex Merutka (57:01.889)
Egg, it's given a lot of leverage and a multiplier effect on folks that are just eager to learn and that can do multiple roles.
Brett (57:08.947)
And and it well and this is a phenomenal like you're this you guys are like a living embodiment of the trend that we've talked about over dozens of
Episodes, Rio, of the of the the the rise of the hyphen Yeah, the rise of the hyphenated job, the the death of specialization, the fact that AI sort of democratizes people to do things that otherwise would have been containerized, let's say, in specific functional orgs, right? You're saying no, you can have one person pro like Ackerman at Digital Turbine, you Michael, you gotta come in the pod. I reached out to you. He's been on once, but I want to get him out again because he's such a great guy. is he's a he's an example of a person that is
Rio (57:18.431)
Yeah, remember the Drew Burdick episode, right? he
Rio (57:41.801)
It's on a shorter one, yeah.
Brett (57:46.046)
product plus commercial, right? And you slam them together and you've got the subject matter expertise of the product leader, you've got the commercial acumen and use case knowledge and domain expertise of the commercial person, and you put them together. But that's happening across functions, is what you just described within your own team. So you've org your team that way.
Alex Merutka (58:03.183)
I mean, my Yeah. My my COO, she built out our CRM system with AI. Like she had a product management tool that she loved and she was so obsessed with it. She's like, I wonder if I could build a CRM attached into it, pull it all in and build it. She just locked herself in like a room for three weeks. Her or you know, her her recent husband hated me, but you know, she was like out for three weeks building this thing, came back and it was like, Wow, now we don't have to use all these different tools. We've just added and built it into one.
Rio (58:03.399)
Yeah, br go ahead, Alex, yeah.
Rio (58:11.422)
Wild.
Alex Merutka (58:31.553)
And and she came from the revenue side and then took over product and built this just to make her life easier and and align the whole company into one product.
Brett (58:40.199)
Without having to deal with the headaches of Salesforce, maybe hub spot, right? Yeah. And the cost.
Alex Merutka (58:43.467)
Correct. Yeah, we we dropped both those guys. Yeah, we dropped both of them. And it wasn't really a cost thing. It was just we wanted everyone under one roof so that we can connect all the systems because it's all about communication around data and inputs. And if you have like 20 different softwares all talking to each other, there's gonna be like miscounting, overcounting, things like that. That's gonna you're you're gonna miss some things. And if you're all in one central platform, it's a lot easier so that data congruency
Rio (58:44.317)
The cost, right? Yeah.
Alex Merutka (59:09.219)
That the developers can see, I pushed this, this is what happened. I directly see my feature being used by XYZ client. Developers feel good. It's it's about, you know, ultimately it's about culture. Like that's why I'm a people first guy. Of course, I'm gonna say that. Like I love, I love people, I love culture. When you have people of the right culture that want to go build, that wanna, you know, step up and be a champion essentially, and that wanna solve problems, they're gonna look at things differently. And I think you really gotta challenge the way people solve problems. You know, there's there's that book like
Brett (59:21.898)
Yeah.
Alex Merutka (59:37.582)
2x or 10x, I I I forget. Like, but it's a good mindset of like if someone asks you to try to 2x your current, you know, workflow. Or like if you're if you're going to the gym and you're like, hey, someone asks you to how could you lift 50% more? You're gonna use your brain and be like, all right, I think well, if I start taking creatine and I work out, you know, 20% more every year, maybe, yeah, maybe I'll get there.
Brett (59:38.846)
Yeah.
Brett (59:55.998)
Yeah. It and if yeah, and if you put everybody at the same if you the data congruency point you made is really important because if you put ever everybody at the same baseline to say everybody's got equal access to the same information, right? Salesforce has never worked that way. Yeah, Salesforce like, you know, you might you're lucky if your marketing department has access to Salesforce. Maybe the mar maybe the the demand gen guy does, but but
Rio (01:00:07.965)
And the same tools, right? Yeah.
Alex Merutka (01:00:09.602)
The centaurs. Yeah.
Rio (01:00:17.769)
Well well, Salesforce has tried to counter some of this by going headless recently and like they're they're pushing people to use their agents. But I Alex, it's a good point about how like if you want everything connected together, you want to have like agents that can skip across things and people that can use things across and how and ha you know, I can certainly see the wisdom of doing it that way. And like to kind of go full circle on the creative thing too. I like the the argument the argument that the prevailing argument was all creatives being devalued, it's like the cost of productions go close to zero. I think it's almost you're countering that by saying it's actually more important now, right? Because you were able to like
Alex Merutka (01:00:46.135)
yeah.
Rio (01:00:47.645)
We can produce the cr we finally can produce the creative and the volume and at a level of personalization we never could before. And that's what's really driving a lot of the difference when you look at the results.
Brett (01:00:56.063)
Yeah. It
Alex Merutka (01:00:56.429)
Yeah, I mean, if everyone has access to the same stuff, then there's no competitive advantage. It's all about like you're you're in an auction. Like advertising is just a big auction. How competitive is your offer and the price you're willing to pay for that? And your engagement, like the equation to figure out is something gonna you know, what's the effect of CPN on it? Is like the model, is someone actually going to is this ad going to drive a click? Is the bid high enough to to get a a space in the ad auction?
Brett (01:01:00.491)
Yeah.
Alex Merutka (01:01:23.243)
And when you're thinking of creative, if everyone's plugged into the same tools all the time and there's no there's no human oversight, like that's why I use the word instinct. Like sometimes humans just get a gut feeling. My mom always told me this when I was younger, trust your gut. and and and there's something to be said about that. Like I've experienced that my life. I have a feeling and I go for it, and there's something else out there telling me this is right, and then it hits. And and like there's no way AI can do that, right? That's a human instinct. So you have you have
Brett (01:01:35.764)
Yeah.
Rio (01:01:47.795)
No w no way, yeah.
Brett (01:01:49.055)
Yeah, that's ser serendipity, right?
Alex Merutka (01:01:51.437)
Yeah, you have like you you you you you leverage AI to have this tool to accelerate production, of course. That's that's helping a ton. But the way you're really gonna stand out is having that human touch point on whatever you're doing in in in things with AI.
Brett (01:02:03.123)
Yeah. Yeah, 'cause there's that fear that there's the g the the great flattening, you know, where everything starts to look alike. Our content all all the content we're reading starts to look like. There's a reason why we can all identify an an AI written article. Same with that AI creative, but you're saying it's a it's increasingly important for a brand to still have a distinct identity, which which is not just incremental audience capture. It is it is specifically around
Alex Merutka (01:02:10.808)
Yeah.
Rio (01:02:13.683)
And you do see that. You l go to LinkedIn, that's like example A, right?
Brett (01:02:30.665)
what we you know, this the the sight sound in motion, what we hear, what we see, and what we experience with that brand. And that's creative by definition.
Alex Merutka (01:02:34.179)
Yeah, it's
Alex Merutka (01:02:37.932)
It's how you stand out. Like, you know, w when we look at it, we think interactive in games is that next big wave. So when you look at app leaven, you we've been talking about a lot about appleing, but they just launched an app called GIST, which is their social media app. And there's playable interactive ads directly in the feed. It's the first of its kind. Meta, TikTok. We've been telling Meta and TikTok, you guys should be doing this for a very long time. Snapchat just started doing interactive ads. Reddit has them. Discord has a thing called Quests.
All these are gamified ad units. Roblox is putting ads in their business and getting into gamification. Every one of these, EA just launched an ad business in in game ads, and they're definitely going to lean into gamification and gamified ads. So this there's a whole wave of folks building gamified ads. And also Meta just launched Pocket, like their social media network, which is just a playable feed. It's basically Instagram or TikTok, but for playable games and interactive ads that you could build quickly. So
Because everything's becoming like, yeah, that same flattening, games makes things a little bit more spicy, right? There's there's way more interaction points, it's exciting, it's fun.
Brett (01:03:39.359)
Yeah. Well Yeah.
Rio (01:03:40.96)
Well ro well i Roblox is what convinced me by the way about how big mobile's going to It's funny as actually during the pandemic I remember my daughter started getting into Roblox with all her friends and then after a while she says, Dad, can you give me some money so I can get Robux, I can, you know and I and like I would I would give her the money and then like I within five minutes it would all be gone. And I thought, Wow, okay, like this is incredible how effective this is at getting getting people to spend money. Yeah. It was it was really
Alex Merutka (01:03:53.4)
Yeah. Heard the story.
Brett (01:03:59.427)
yeah.
Yeah, we were spending like a couple hundred bucks a month with my younger son. We're we're like and you know you kind of ask him, like, so what did you get for that? I gotta level up right. Or I got a new weapon, right? You know You know, Fortnite. I I like I j I I was able to to win Fortnite a like a sp a one session because I was it you know and I'm like, my god, these these this empty value. sorry, I cut you off. You're you might have had a question at the end of that, comment.
Alex Merutka (01:04:11.768)
Yeah.
Rio (01:04:11.773)
I g I I I got a new pair of jeans. I have a new pair of jeans on my o on my avatar, right?
Rio (01:04:29.107)
No, no, I was just saying how r like that's what convinced me that this was this was going to be a massive thing and was currently undervalued. So it it's interesting, you know, I guess it's not surprising to see how it's really how it's really took off. So I guess look looking ahead in terms of creative production, like what like what do you see happen? Any predictions for the next two or three years in terms of where things are going based on the current trajectory?
Alex Merutka (01:04:48.14)
Yeah, I mean all things gamification basically. I mean the two apps that Meta and and and Applevin just rolled out. I see this whole wave of na na especially devices and things are getting more sophisticated. You can actually load these more like high fidelity, robust type of ad units that you wouldn't be able to before when you just had to do like a flash ad, for example. So prediction is everything gets more gamified. I mean
Gamification in general, you look at these reward apps that came out this year that are spending a ton of money. You look at like a company called Just Play, it just got acquired, Misplay spending a ton, all media free, free cash, like these sort of reward apps started spending a lot of money over the last few years, but specifically this year they spent a ton more where they're just rewarding users to go in and play games and gamifying this reward system.
Gamification across the board, I I think I mean if you look at all those QSRs like Starbucks and Chipotle and all those reward loyalty apps, I think everything just continues to lean into more gamification through advertising and through everything else.
Brett (01:05:37.375)
Yeah.
Brett (01:05:50.983)
And and do you think that gamification by definition i i inc includes sort of dynamic data information creative that's
Rio (01:05:59.52)
Well you look at Robin Hood, Brett, like what they've done. Like they've gamified finance. I mean, and you know, it's especially for Gen Z millennials, it's I think it's one of the reasons why it's taken off so much, right?
Alex Merutka (01:05:59.95)
Hundred percent.
Brett (01:06:03.464)
Yeah.
Brett (01:06:08.424)
Yeah. So so Alex my
Alex Merutka (01:06:08.896)
And the people that win there, yeah, I think I think I get your point, Brett. But like yeah, the people that win there are gonna be the ones that can they they have that gamification layer, but they're plugging in the right data signals, they're pulling in the right information into real time.
Brett (01:06:19.485)
Yeah.
Yeah, yeah, no, and that and it's sort of like the containerization of creative in a way.
Right? Like there's a big talk about within the bidding system, containerization of that process, right? Which, you know, people's some people have talked about it as we're moving from s sort of an audience targeting economy to a context economy. And and when you containerize, you're able to basically insert stuff during this sort of bidding process in real time versus kind of during the planning process or or ahead of that process. Do you think that that's a future in creative where creative will have just a much more dynamic update, almost feed like
real time feed quality to it is it
Alex Merutka (01:06:56.92)
Yeah. It's gonna be a living thing basically, yeah, like a living organism and it's gonna be able to pull and make decisions. So everything's gonna get more personalized, more customizable. So when you see an ad like with less targeting, you can't I can't you know, target very specifically like I like we used to. We we just we can't track users the same way. So you're gonna have to give people choices. Maybe you have an idea and you know a little bit about, you know, Brett, but you don't know everything, so you're like, okay, if I'm Nike and I'm targeting Brett,
Brett (01:07:16.713)
Yeah.
Alex Merutka (01:07:26.258)
I I'm gonna say, hey Brett, are you more interested in basketball shoes, sneakers, like high tops, or skater shoes? Like what what what's or like maybe a running shoe? What are you interested in right now? And give you like three options. And maybe you know, you're you typically online, you've always been a basketball shoe person, but you know you're you're you're just about to sign up for a marathon and no one knows that besides you, and you're like, actually running is more relevant to me right now. But you can basically front-load product experience on the ads themselves.
Brett (01:07:33.223)
Yeah.
Brett (01:07:49.311)
Yeah.
Alex Merutka (01:07:53.336)
We're gonna see a lot more shoppable, like directly shoppable ads inside an ad and being able to purchase and you know, double click, scan your face and check out.
Brett (01:07:56.585)
Yep.
Gives gives the consumer to say, Hey, you know, relevance, you know, and th that brings up the debate. Do people really hate advertising? You said that in the earlier part of of our conversation. And I was like, I you know, people I don't know if that's necess Yeah, they hate bad advertising. Bad, irrelevant, interruptive advertising.
Alex Merutka (01:08:06.935)
Yeah.
Rio (01:08:10.025)
Think they hate bad advertising, but
Alex Merutka (01:08:11.671)
They hate bad advertising. Yeah. Relevant relevancy cor correct. Yeah. And interruptive. But if you're I think people get like no matter what, you're gonna have to see ads. It's the way the world works. So you might well see a good ad that's either like f like fun and engaging, that's gonna like release some endorphins and connect your brain with those endorphins. Like hopefully like minimum you're getting that. Best case scenario, you get a super relevant ad where you're like, I actually need
like I'm you know, I'm in Montana right now and I and I went fly fishing recently and I wanted another shirt that had like a hoodie and basically sun protector. I'm getting ads all over Instagram for it right now. And I'm like, I I clicked on it. I'm like, you know, this ad doesn't suck. I actually kind of need this. It was overpriced, so I didn't buy it and I just picked up one at Sims Fly Fishing Company. But, you know, I looked at it and I was like, Yeah, this is this is relevant to me. I need this. This was on my phone. Yeah, on my phone on Instagram.
Brett (01:09:00.402)
No, on your mobile device or on your desktop, right? Or b or laptop. on your phone, yeah. 'Cause 'cause real, I think it's a f
Rio (01:09:05.587)
Yeah, but but I've actually bought things. I bought things from Instagram and Facebook. I mean, I it's that's that's the only platform that's consistently delivered me like relevant targeted ads where I thought, Okay, that's actually great. I've bought everything for wallets to shoes to jackets. I mean, it's really effective. Just shows.
Alex Merutka (01:09:09.367)
Same.
Brett (01:09:09.696)
interesting.
Brett (01:09:17.564)
Yeah. Yeah, within your feet and it's fun it's funny 'cause there's a big theme and I'm sure you've heard it, Alex, in in when you go to to shows that are that are sort of
But not typically mobile first in terms of their focus. It could be programmatic, it could be possible in Miami. And there's a lot of talk about like why have we have we oriented everything around the click? Right? The click is the is the least sort of important action for somebody to take when they're exposed to a C T V ad, right, or last click attribution, that sort thing. But it sounds like there's a little back to the future happening here, right? Within mobile, within the gaming environments and app environments, clicks are
Rio (01:09:45.183)
Especially last click.
Brett (01:09:56.028)
those are actually still kind of sacred, right, it sounds like.
Alex Merutka (01:09:59.138)
Yeah, well, the cool thing on your phone is we can attach a heat map and actually t figure out where you're touching on the screen, the entire thing on the ad. So you can get actually a lot more information from your phone of just scraping like where you're actually touching. I think last click doesn't work so well in some environments because a lot of these like clicks are just accidental. So yeah, there's like depending on how you're looking at advertising and what tools you're using, like I think you know, you're looking at the measurement companies like Pression A or House or Measured.
On the e-com side for we have you know when you're running app 11 campaigns, there's there's different value. I mean, we I think we've had a couple of advertisers that were spending a ton of money on app 11 for e-com. And they looked at their incrementality and said, well, we're actually gonna pause down app 11 a little bit and redirect spend somewhere else. And when they did that, they they looked over at their Amazon campaigns and Amazon took a huge hit. And there was this halo effect from
App Levin, because like Rio said, he's bought things from Instagram and Facebook because he trusts those platforms that he's not going to get scammed or hacked probably from. And he knows enough about advertising that he's probably feels safe in the environment. My mom's in her 60s. I know she she trusts more clicking on slane on Instagram than she does clicking on slime in a random game that she just downloaded. and so I think App Levin has that challenge of like getting users to be comfortable and feel safe buying things in games, and they're proving it right now.
Brett (01:11:01.246)
Yeah.
Alex Merutka (01:11:22.231)
But what a lot of users are doing, what we've observed is that people might see an ad on a game. It actually gets them to want to buy the product, but instead they're afraid to buy it in the game. So they go to Amazon, they search on Amazon. You know, I just saw, yeah, I saw this new, you know, headphone company.
Rio (01:11:33.778)
A bite there.
Brett (01:11:36.231)
The power of brand advertising, even though it has a direct response flavor to it, is the power of like, hey, that that brand awareness caused you to do something, to commit an action somewhere else, right?
Rio (01:11:37.748)
But
Alex Merutka (01:11:44.749)
Correct.
Rio (01:11:45.226)
But but I always thought it was so crazy the things people will actually buy online, right? People think that the people are afraid they won't, but they will. I remember I remember Brett back when we were you know, w way back we used to run these campaigns for these like pants manufacturers. They would manufacture these men's pants in Pakistan, they drop ship them. I mean they like crappy pants, like ten dollars each. Yeah. Yeah, you would yeah, the minimum three per order. I could I could not and it it was some random brand no one had ever heard of. I I
Brett (01:12:02.631)
You buy packs of eight, you know.
Rio (01:12:10.673)
I couldn't believe anyone would buy this stuff, but people would buy like thousands of orders per month of people would buy with online. So people will buy lots of stuff. If they like it, they think it's a good offering, it's a good ad, hit some at the right time, people will buy stuff. Maybe not everybody, but some people will.
Alex Merutka (01:12:22.678)
Yeah. Yeah. I I I I agree. I just think there is like a when when people have asked me why they've why the why they've or like what they've observed from app love in spend and what they've seen connected to Amazon, there was a correlation, like a big one, that if you stop spending on AppLovin that you're gonna miss out on all this revenue on Amazon.
Brett (01:12:41.949)
G app loven's gotta dial into that, right? That's a case study that's important to say, hey, we've got other downstream impact on advertising effectiveness and this is what it looks like. The problem is it's off platform. It's a little harder to track. you need that data passed back to you, but still.
Rio (01:12:42.355)
Your Amazon.
Rio (01:12:57.363)
Well, Google search also contributes to a Amazon sales too, right? I mean they they can they I think a lot there's a lot of ad spend elsewhere that definitely has like downstream like incremental impact on Amazon sales. So that's interesting.
Brett (01:13:01.842)
Yeah.
Alex Merutka (01:13:01.878)
Funce. Yeah.
Alex Merutka (01:13:08.3)
I mean, must be pretty good sitting over on Amazon right now though. Just watching everyone else help you guys close close revenue on the Amazon teams sounds pretty good.
Brett (01:13:15.451)
Yeah, totally. Totally. It's like where that's where you know just about everything's being purchased nowadays. but should we should we this has been a great conversation, Alex. Thanks for spending the time. Should we do quick hits? Yeah. So so I'll start. So creative or targeting, back to that that kind of point I made earlier, which will matter more a couple of years from now.
Rio (01:13:24.083)
This is fun. Yeah. Go to my end.
Alex Merutka (01:13:36.33)
Yeah, I think targeting gets commoditized, creative is the future.
Brett (01:13:39.901)
Yeah.
Rio (01:13:41.245)
What's one indust what's one thing the industry consistently gets wrong or overlooks about mobile?
Alex Merutka (01:13:47.412)
Definitely the pre-click data on what you can capture on mobile and all that information that you can do on the ad before you actually click and buy something.
Brett (01:13:55.24)
Yeah. The contextual relevance, right? one startup or founder, 'cause you're paying attention to a lot, you've named a bunch of them in this episode, you're paying close closest attention to.
Alex Merutka (01:14:06.944)
Like I like I like Gary V and I like Adam Farogi because they're just super authentic. Like anyone who's authentic online, and rear is one of things you you said about me. So I appreciate the compliment of of like just being a founder out there and putting out real stuff. I really appreciate. So I love those two guys and then I like Gamma as as a as a company. Like I thought their what they built and their product has has been incredible. So I I like that company a lot. Yeah.
Brett (01:14:11.571)
Yeah.
Brett (01:14:25.374)
Yeah.
Yeah, they g the gam gamma for gamma for PowerPoint. Yeah, the or maybe we shouldn't cut that that seems like an anachronism right there, what I just said. But but yeah, no, that it's been transformative in just the way I work. I'm using claw design more for slight side design slide slide design now. But just in terms of being able to tra take all of that busy work out of my daily life. It's it's pretty incredible. Did you say Adam Heimlich? Was that was that your okay, d d yeah.
Alex Merutka (01:14:50.44)
no, Adam Farogi from MapLovin. I I just I fall I follow Adam closely. Like, yeah, I I love I love hearing anything he says and talks about because he's just real about it.
Rio (01:14:51.839)
Farogi up, app love and see ya.
Brett (01:14:58.289)
Yeah, Adam Heimlich is the same thing from Chalice AI. It's it's like the all like all three of them and Gary V for sure. It's just it there is no filter. They're gonna say it like they want to say it. You know, maybe they're they're in a position, you know, where they don't work for like a hypersensitive brand that's gonna fire them for what they're doing in social media. But but I do like that.
Alex Merutka (01:15:04.34)
Yeah.
Rio (01:15:15.827)
Yeah, being a CEO helps, but but yeah, but executive led communications, that's a trend. We talked about it a lot. I mean, I I I love it. I think that you control distribution with social. Anyone can do ever everyone has access to it, right? You don't have to work at the PR agency to get the word out. I think like the fact that executives can can post whatever they want, can talk directly with their customers and prospects, it's incredible. Absolutely incredible. So finish the sentence, Adam. The next billion dollar ad tech company will be built around
Brett (01:15:35.369)
Tchau,
Alex Merutka (01:15:42.729)
yeah, next billion dollar ad tech company. I mean, it's whoever can leverage AI the fullest right now. so anyone who's coming in, building something where they're leveraging the most points of AI, but also giving that control back. So the the balance of AI for automation and control, whatever type of control that means for whatever business you're building. Yeah, for us specifically it's creative, but
Brett (01:16:00.638)
Control for Yeah, yeah, yeah, exactly. Yeah, and control back to the the client the end client, right? The brand.
Alex Merutka (01:16:08.086)
Correct. Yeah. You can't just have you don't just want robots taking over the world. We need we need Yeah.
Brett (01:16:11.515)
Yeah. It's gotta be in their system. It's gotta have data governance and data security and zero trust and all that stuff because because otherwise the brands fear their IP is being stolen in a sense. Right. and I I think the final one is most if you're super high level, most underrated trend in advertising right now.
Alex Merutka (01:16:32.641)
I mean gamification. Like I've it's it's awesome that it's starting to trend more, but mostly because of App Levin. Like we've had this whole gamification interactive platform built for a while, but
No one outside of gaming would really leverage it back in the day. And then COVID had everyone became a gamer. So these brands started asking, how do we reach a gaming audience? And the answer is pretty obvious. Well, if you want to hit gamers, hit them with a game. Just branded McDonald's and go launch it. Like super contextually relevant. so I think it's still super underrated. Right now, e-com, like it's funny, you have all these e-com advertisers scrambling to build interactive ads on App Levin.
And because they're like, we need interactive end cards to compete against the ad auction versus these gaming companies that have built like full on playable interactive ad units on App Levin. And now all these other channels like Meta launching their app, App Levin launching their social app, Reddit, Discord, Snapchat, all getting into interactive. It's it's still so underrated right now. And the trend is just starting to take off on this on on all things interactive and gamified for ads.
Brett (01:17:33.032)
Yep. Yep. It's sort of think outside the box when it comes to creative and creative the gamification piece of it. It's sort of obvious it's obvious to you, it's obvious to you from AppLovin, but it's not obvious to the entire brand universe in the same way, right? And it's different than video, it's different than editorial, it's different than static creative content. It's it's something that says how can you directly and rel and relevantly engage somebody, right? And and you gotta make it relevant. It can't just be gamification for the sake of gamification.
Alex Merutka (01:17:38.174)
It's completely different, yeah.
Rio (01:17:57.951)
Well, Brett, a and and I like like the tie in between what's going on mobile and what and C T V. I mean Alex you mentioned that before. That there's a th they're closely related and I think more so as we as people consume more C T V content and the C T V channel gets bigger as in terms of where advertising dollars are going.
Brett (01:18:13.201)
Yep. Well, Alex, thanks a lot. appreciate the time. appreciate appreciate the honesty, and the willingness to just really go deep into these topics and and meander around a little bit. we'll we'll certainly love to have you on again. good luck with everything over there and everybody that made it this far.
Rio (01:18:17.503)
This is great.
Brett (01:18:33.255)
Visit us at wdebdeb.signalandnoise.ai on Spotify, YouTube, and Apple Podcasts. And read our articles as well. We're pumping out a lot of those. And we'll talk to you soon. Thanks, Alex.
Alex Merutka (01:18:45.706)
Yeah. Thanks, Saz.
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