The Effective CMO: Mercado Libre's Sean Summers

0:09Ann Marie Kerwin: Welcome to The Work Podcast. I'm Ann Marie Kerwin, America's editor, and today's episode is part of our ongoing interview series, The Effective CMO. My guest today is Sean Summers, Mercado Libre's chief marketing officer and EVP of Mercado Ads. Mercado Libre is Latin America's largest fintech and e-retailer and is often described as the region's answer to Amazon, eBay, PayPal, and Shopify all rolled into one. It operates across 18 countries and serves more than 100 million active buyers. In his role, Summers describes marketing as a demand generation engine first and foremost. Every activity must ultimately contribute to growth, creating the credibility that allows the business to take bigger creative risks later.

0:53Ann Marie Kerwin: He's managed to deliver that demand while also taking home a slew of CanLion awards, including back-to-back Grand Prix wins for MercadoLibre's innovative campaigns merging brand messages with immediate calls to action. I'll welcome Sean in just a minute, but first, a word from our sponsor.

1:15Ann Marie Kerwin: Most Contagious is returning to London on the 1st of December, and tickets are on sale now. Steal a march on 2027 by learning the secrets behind this year's most creative and effective brands and campaigns, as well as discovering the most important trends set to influence the year ahead. If you give us a day, we'll give you a year's worth of insights and inspiration. Just search Most Contagious Event to find out more.

1:45Ann Marie Kerwin: And we're back. Hello, Sean. Thanks so much for coming on the podcast today. Hi, Anne-Marie. Thank you for having me. Oh, it's so nice to see you. So this is our Effective CMO podcast series. And so I like to ask each of our marketing leaders when they come on the question, what is your philosophy on effectiveness? I think for me, effectiveness is executing a set of marketing initiatives to deliver specific business outcomes. These business outcomes have been planned with a specific investment and an ROI. So it's delivering on plan. And obviously, effectiveness goes hand in hand with efficiency.

2:29So they give us some resources. Our business partners give us some resources to invest, to deliver those business outcomes. And we have to respond for the use of those investments. And I have to say, effectiveness also has to do with driving category penetration and driving market share. It's not just about, oh, let's grow. Yeah, growth is great, but you always have to be, has to be relative to your competitive set.

2:57Ann Marie Kerwin: Exactly. Like where is your growth going to be, right? That's just as important. And also, you know, we operate in a category that still has a lot of penetration opportunities. So you have tailwinds. So in a category like e-commerce in Latin America, like 20 % growth is not a good growth rate. You have to aspire to be well above that. So that's why the relative performance with the market is also very important. That's excellent. So how do you work with your team to prioritize effectiveness within the context of your brand strategy? And how do you then communicate that across the business? Well, I think there's a lot of focus on balancing the short and the long term.

3:44And I always say that we have to deliver those short-term results because that's the basis of everything that we do with business and with our business partners and how we think for the long term. What I mean is we have to own those business results in the short term. And there are a series of levers that are going to help us achieve those results. But understanding that that alone is not enough to have that sustainable growth in the long term. So we manage a portfolio of initiatives. We deliver in the short term, for example, all our performance marketing initiatives, you know, in Google and Meta and TikTok, they're all geared towards what you're going to deliver today, this week, this month.

4:32And we know how much we're going to invest and what's the ROI. All our seasonal campaigns like Black Friday, Cyber Monday, Christmas, Mother's Day, they are also geared towards delivering short-term results in a very specific timeframe with very specific ROI targets. Great. That's going to deliver the numbers for the short term. Now, and you can also, that's very much also driven by price and by discounts and rebates. that's great but that's not the way to build sustainable results in the long term. So when we're thinking about the midterm, we also have some initiatives that have to do with, okay, let's do invest behind app downloads, for example.

5:14Why? Because we know that a user who has an app in the home screen, it's more loyal, it's going to open more often, it's going to have a better conversion rate, a better retention rate. Now, if you measure the return only in the first transaction, you're not going to be willing to invest too much. Now, if we look at the lifetime value over a short period of time, next 12 months, that tells you what's the CPA, the cost per acquisition that you are willing to pay. So you're willing to go a little bit wider in that window. Something very similar with our investments in our loyalty program. We don't measure them by what's the short-term result.

5:50okay, we're going to invest short term to bring a new user or an existing user and offer all these free shipping discounts and the cashbacks. We're going to measure what's the incremental sales that that user is going to have with us over the next 12 months. What's the incremental variable contribution that that's going to generate? So that's how we balance the midterm. And then there's some investments that had to do with the brand that are about how do you make sure that your brand stands out in the long term, so stand out culturally. And that's probably what we do with specific sponsorships like Formula One.

6:29Formula One and Franco Colapinto, which is an Argentinian star, is not going to bring delivery result today. But every time that we execute, our metrics go through the sky. Why? Because people engage in a different way with the brand. they know that we are the brand that is supporting this driver, this Latin American driver, you know, to achieve his dream of running Formula One. And the same with some of the campaigns that we have done in the past during the COVID times or with our diversity, equity, and inclusion campaigns. So the secret is how do you balance? And we don't have like a specific formula like 70, 20, 10.

7:09is directionally, how do we make sure that we are finding the right balance? And as you can imagine, if it were just listening to our business partners, everyone is focused on the short term. So we have the same pressures that everyone else. Let's put 100 % of the resources to deliver the short term. The way I think about it is, how do we make sure that 80 % of those resources can deliver, 80 or 85 can deliver 100 % of those short term results so that that gives us the 15-20 % of the budget to invest in these two other horizons, the midterm and the longterm.

7:47Ann Marie Kerwin: That's often a struggle that a lot of marketers have, making that argument to the C-suite. Like, this is how we're going to do the investment, and it's going to pay off because we have this long-term goal of building the brand. What have your conversations been like with your C-suite team to lay out your strategy? I think you have to be very clear with them as to what you can measure and how and what you're trying to achieve. So many times I hear this argument about, oh, we're going to build the brand equity super important. We're going to show you in three years' time that that's happening. Well, that's not how it works.

8:25When we deliver the short-term results, we are building credibility. We're showing that we are reliable and that we are accountable. We told you that we would deliver this with this level of efficiency, with this level of investment. So with that, we earned social capital. But then you have to be willing to go and say, okay, on top of these short-term initiatives, I have to invest in these others. Because this is the reason. Why do I want to build brand equity in the long term? Because in the long term, I want to become the point of entry, the reference for any consumer looking for a product or service.

9:01So I want to be the point of entry to commerce. I want people to think I need something. I'm thinking about Mercado Libre because I know it. I've tried it. I had a good experience. I don't want to keep going through intermediary channels trying to get that transaction to come every single time. Now, that's something that you build over a 5, 10-year period of time. Having said that, every quarter, every month, every year, you can show what's the progress that you're making against specific submetrics that tell you that if you're making improvements or not. When we started investing behind brand 10 years ago, less than 10 years ago, there were many things that we couldn't measure as well as we measure our performance marketing initiatives.

9:46I was very clear with our CFO. So we started building those mechanisms. But we were able to prove over time that if you build certain brand attributes, those are going to impact either consideration or preference. and depending on what you're trying to achieve, if it's a short-term or mid-term result, if we drive consideration, that's going to have a direct impact in the mid-term sales. If you are trying to move your long-term sales, if we move preference, that has a good indication. It's not perfect, but so you start showing every single time that you're trying to measure what you did, what's the output, what you have learned and how you keep iterating that process.

10:29It's a never-ending process. So I think that when you show that you are oriented, the team is oriented to measuring everything, to learning from the things that work and the things that don't work, reporting back, and to keep iterating and building those systems, I think that's how you build the credibility with the CFO, with your business leaders. The good thing, in my experience, I've been in this role with MercadoLeader for eight years, and before that, I used to run the marketplace. we were the ones bringing that discipline to the table. I never had to have a conversation with the CFO telling me, or my CEO telling me, like, oh, you guys are not being disciplined.

11:11We would say, we want to measure in this way. We don't have the tools. It's going to take us two or three years to build the tools, but these are going to be the intermediary milestones, and this is how we're going to get better and better. But the analytical rigor was always there. It's always there from the beginning. Even if we don't know all the answers, we make sure that we prove to them that we are making all the right questions and that we have a specific plan. So when you repeat that over and over again, I think that's how you build the credibility with your business clients, with the CFO.

11:45Ann Marie Kerwin: And you've had a lot of luck with using creativity. You have Ken Lyons now to show for these awards that you've won for these super creative campaigns that you've done. How did you start having that conversation with the C-suite around the idea of having a strong brand platform and that your creative ads were going to actually contribute to growth? Was that a conversation that was easy or hard? I always tell them after the fact. That's my secret. I don't try to convince them. You're talking about using the social capital. If you try to have an intellectual discussion, it becomes maybe too tiring.

12:30So I said, part of using the social capital is like, this is where we're going to go. I'll let you know where we learn. So the first conversation wasn't even with the C-suite. It's with my agency. So I have to say, because I've always been very business-oriented, for me, it was always about business comes first, business results come first. And maybe, I'm sure that mistakenly, maybe I wasn't that convinced that, you know, great creativity delivered great business results. Now that I've been in this journey, it's a stupid, you know, thing to say. But the reality is that maybe I wasn't that obsessed with, you know, great creatives drives business results.

13:10So it's very synergistic. So at the beginning, it was just fixing the basics. So let's make sure that we are doing good, solid brand communications, not taking a lot of risks. We were so bad at the beginning that it was really fixing the basics gave us good results. But obviously, after a couple of years of doing the basics, that's not enough. And that's when Gaston Vigio in Guts came to me and said, look, Sean, I think that we have to raise the bar in terms of what we demand from creativity. and we had this conversation and he said, I'm sure that I can prove to you that we can do great creative that delivers business results.

13:51And as a consequence of that, it could be great creative that could be recognized by the industry. So we didn't start with the objective. I didn't put an objective of, oh, I want to win a Cannes Lion. I didn't even know where Cannes was six years ago. Oh, if I'm honest with you. So, and we started the journey and I think we were lucky. In the first year, we did some amazing creative, and it delivered business results better than what we were doing. We won the first client. So, Gaston, tell me, okay, let's keep going. Let's start believing that this is possible. Let's take more risks. The guys in GAP, they have this bravery scale, which is how brave are their clients in terms of their creative work?

14:36Obviously, at the beginning, we were, and they created the scale almost at the same time that we started working with them. So, apparently, we were a zero, a one, or a two at the beginning. And now, I think we're like a 10. But it's because we went together in this journey, and it becomes like a flywheel. You keep doing great work that delivers business results that is recognized by the industry. And then everyone wants, you know, the great creatives want to work with you. And they even want to work with the staff that maybe a few years ago, they didn't want to work, like the promotional staff.

15:06which wasn't cool. But when you show them that you can do some, I call it magic, magic creative, you know, magical creative with down-to-earth promotional activities, suddenly I think that that's fantastic. Interestingly, when I talk to the CSUIT, I always talk to them about the business results. I don't come back, we don't come back from Cannes and share, oh, we now have like 53, in five years we won 53 Cannes Lions, which I'm super proud. We're super proud as a marketing team, as an agency. We don't sell anyone in the business. It's not like, you know, in the next quarterly business review, we're going and we're starting with that.

15:47They find out eventually because, look, you have to live with that. It's like my internal client is not going to care a lot about that. All they care is about they see that the brand is getting stronger and stronger. It goes up in every single ranking, reputational ranking, you know, preference ranking in the region. Our direct traffic keeps growing in a solid way. As I said before, we become the reference for commerce in the region. They measure that. All the awards and other creatives, those are means, not ends to our purpose. And as a marketing team, as an agency, we celebrate that. And then we move on and we say, okay, let's keep delivering.

16:27But nobody inside the business has a conversation about Cannes Live.

16:33Ann Marie Kerwin: That's great. Great. Well, I know you told this story at CanLines when you were on stage working with your agency gut about one of the first briefs you brought them were do whatever you want, but don't change our slogan. And then they came back and said, actually, maybe you do want to change your slogan. Was that how did you first work through that conversation? And then what did it teach you about, like, the kind of relationship you can have with your agencies? Actually, it was, you couldn't imagine, that was a very easy conversation. Because behind the tagline is the wrong one was, like, your insight is the wrong one.

17:16Oh, right. It was even deeper. So it's like, you know, actually, your brief is kind of rubbish. That was the elegant way of it. But I like the thinking. So I'm not protective about these things. I care about the outcomes. You know, the process, we co-create everything, you know, with the team inside. And I said, actually, I hear you, and I think it makes sense. What do you say? Come and pitch it that way. If you're so convinced, my initial reaction is, I think you're right. And you have the conviction, and the other agencies, you know, didn't raise the issue. Come and compete in the pitch in that way.

17:56and I really liked the conviction and the courage to come and, you know, at the time, GATT was a new agency. They didn't have a client. They needed it. Oh, you were their first client. Yeah, yeah. Oh, amazing. Gaston told me, like, mate, I really need this. I need you as a client, and I don't feel comfortable going to a pitch when I think that your brief is wrong. So I really think that, you know, that talks a lot about having courage. And when you start, and we didn't have any personal history with Gaston or Anselmo. I didn't know these guys. So it's not that we could, but sometimes it's like, it's better.

18:31So we didn't know each other. I liked the way that they thought. At the time Luis Maccaro was leading our branding efforts, we liked the challenge and we said, let's go and do it. And as I said, after that, it was a couple of years of doing good work, but nothing, you know, that was amazing. It was just fixing the basics because we had been doing communications on and off, not that well for a few years. But once you have those basics in place, with the right agency partner, with the right mindset, and sometimes, you know, with the right environment, we started doing this process. And it just became, it's a never-ending process.

19:13So let me take you back, you know, to Cannes this year. you know we always get together with the entire agency team in can on the monday morning before anyone knows if they have won anything because it's not about you know winning the awards and the conversation you know we have been in a pretty good run for the last four years and then we had a fantastic you know 2026 but the entire conversation was about you know we're not pushing hard enough we're not excited i'm not excited my team is not excited you guys are not excited. We are both part of the problems. Maybe we, you know, our briefs are not as exciting as they were in the past, or maybe we are not brave enough.

19:51So the entire conversation we spent a couple of hours in the morning was about we're not good enough. It's funny because people look on the outside, and then we want to like a lot of can liars, and the business results are fantastic. But I think that the only way to keep going at this pace is to keep pushing. You can never settle, you know, you have to enjoy the success you know you have to celebrate but you always know that there's always uh you can elevate the bar you know so this year as we finished the meeting and it was very intense so the people that don't don't know me and my team they were like what's the problem with these guys you know they're not happy haven't they seen all the great work that we have done in the past and that we keep doing it's like you know they're happy it's just that they want more and uh and i i think so So I told Anselmo and Gaston, what would be the definition of an 11?

20:45I know that the scale on bravery goes from 1 to 10. Well, we're close to 10 and we are not excited. What would it mean to be an 11? And maybe we have to change the scale.

20:57Ann Marie Kerwin: Right, right. That's hilarious. I'm very interested in one of the campaigns that you did around the best is coming. when you really made that moment of delivery your brand equity builder. And I would imagine that that campaign, because it also involved all parts of the business, needed a lot of sell-through for the business to make the changes you needed to guarantee that you would be able to have that brand moment. How did you start having that conversation within the operation about, like, this is what I want to do. That's what I love about this business. It was a one conversation. And the way it works, so that was related to the pitch.

21:44So when GATT came with the idea, the insights, their insight was, guys, you're focused on the aha moment that you've been working on over the last few years is no longer the aha moment, which was the search inside the app. That's not the magical moment. The magical moment now is that people press a button you're up and the product showed up, what you promised in the timeframe that you promised and everything. That's the aha moment. And for us, I love the idea. I wasn't feeling that comfortable because this pitch happened only six months after we decided to build our own logistics infrastructure.

22:26So we had been working with logistics for a few years, but always using our technology, but third-party infrastructure. And then we said, if we want to take this to the next level, if we want to really shorten the delivery times and lower the delivery costs, we have to own the end-to-end of this process. And we looked at each other and it's like, but we don't know anything about logistics. We have never managed any physical infrastructure. Well, we have to do it. So we put our best business people our best software developers to tackle that massive challenge. So when God comes with this point of view, we are only six months.

23:08We have probably opened one full treatment center, two. Yeah, we knew that this was, we had embarked in a journey that, you know, we would never turn around. So definitely. But it was very early in the journey. So we could see the insight, but I wasn't entirely sure. but we weren't entirely sure if we would be able to deliver against that promise. But then in that conversation, so I involved the C suit in the pitch. So in the final presentation, I said, guys, come. Come because I think this goes well beyond marketing. And Marcos, our founder and CEO at the time and the rest of the team, they got really excited.

23:46And they said, I love it. Yeah, this is scary. But on the other hand, we're going to be burning our ships. We know that this is a journey. We're not going to be tentative. We decided to do this, and we're going to do it over the next 10 years. So this has just been going public with our consumers, probably sooner than what we feel comfortable. But we know that once we put the light on the sun, we will have to move forward. So we looked at each other in one meeting, and we said, this is the right thing to do. Let's just go and do it, and we better execute against this ambition. And that's what we've been doing over the last eight years.

24:26And we have built in eight years the largest and most efficient distribution network in Latin America, which is insane. It's one of the things that really blows my mind. And I wasn't involved in the development of that network. So I'm very proud of the work that my colleagues have done.

24:41Ann Marie Kerwin: Yeah, that does seem like turning it up to 11. We're not quite ready, but we're going to promise it. It was scary. One or two fulfillment centers. Today we have dozens of those around the region. It's like at the time, now that I think about it, it was quite brave as a business. But I loved the idea and probably was the first time that I felt that marketing was finally a core function inside the business. I think being a technology company, I was always clear, different to my previous life in consumer goods, marketing wasn't at the center of the action in this company. And I knew it. And for the first 20 years, marketing played an important role, but it was a support role.

25:28And I think that that was the first time when I said, oh, maybe marketing can play a different role. Fast forward eight years, eight and a half years, today marketing is very well established. We are a big driver of everything that has to do with demand generation, which is very important in a company like ours, both from an e-commerce point of view and a fintech services point of view, we are a growth company. So bringing a lot of consumers more often to transact more with us at a cost-effective way, it is a very important function. And you can see that the marketing budgets have multiplied by, I don't know, by now, 200x, 250x compared to when I joined in 2012.

26:16So I do think that marketing plays a very, very important role in creating demand and keeping our customers happy.

26:46Ann Marie Kerwin: and contagious to create industry-defining thought leadership. From crafting the narrative to amplifying it at scale and placing it in front of key decision makers. So your story doesn't just add to the conversation, it defines it. Learn more at lions.co forward slash thought leadership.

27:08Ann Marie Kerwin: One of the other things you've done, and you alluded to it earlier, was this idea of a promotional campaign becoming a real brand moment. And that's something that at work we talk about doing. When we wrote the report, The Multiplier Effect, the idea that you can use your performance ads to get a brand message across. And you've done that very well with Handshake Hunt and a couple of the other things you did that actually ended up winning CanLiance. So how did you sort of hit upon this? Was it just that gut was like, we want to do bigger things? Or were you like, we can keep the brand message going?

27:50No, as it usually happens, it came from a moment of frustration, now that I think about it. So when we built our communication framework, we said, we're going to communicate at three different levels. We call it the do, think, and feel. okay the do is we're going to give you a message for you to do go and do something now and that has to do most of the time with you know the seasonal campaigns it has to do with price and selection okay and then on top of that we say we're going to give you reasons you know the thing is reasons assuming that everyone else can give you price and selection we're going to give you additional reasons for you to you know rationalize why MercadoLibre is the best option We're going to give you the free shipping.

28:35We're going to give you the fast shipping, our loyalty program, the guarantee returns, and a series of things. And then on top of that, as you know, the icing in the cake, we're going to do the feel, which is if we deliver on the do and on the think, we gain the trust from consumers to go and make you feel something different. We're not going to try to sell you something. We're going to make you either because we get involved in a passion point. It can be a football club, or it can be a Formula One, or it can be music or it can be COVID-related initiatives. But it's more about showing to consumers that we care about what's going on in their lives, what they care about.

29:14It's not about trying to sell the manager. And what happens, and that's a framework that we probably came up with five or six years ago. And what naturally happened is that the creatives and the brand managers would get excited about the field because the field gives you this idea, oh, that's where you can do the magic. And suddenly the do and the thing campaigns were, ah, we have to do the do and the thing campaigns. That's what helps us pay the bills. The do and the thing campaigns are the ones that move the business. And there was a specific year in which we looked backwards and we said, are we proud about it?

29:47What made us proud this year? And we do a lot of campaigns and every year we do more. And it was like everything was okay, nothing to complain, but is that the definition of being proud? No. And then I said, well, I think the problem is that we get too excited about the field. And the field campaigns, by definition, I told you, we spend only 10%, 15%, 20%, not more than that. So why don't we challenge ourselves to bring the magic not just to the field? Bring me a little bit of magic dust to the do and the thing campaigns. That was a challenge to the creative team. Come on, guys. Let's get excited.

30:25And suddenly, they changed their mindset. And they said, well, okay, let's make... And a few months later, they had this Black Friday campaign. And they approached the creative process in a different way to the previous years. And they came up with Hand Check Hand. It was just a matter of changing the angle. It was about convincing ourselves that, yeah, a promotional campaign can be funny, can be exciting, can be surprising, can have a cut through. and then we were blown away by the success of the campaign. So once you have one success, it's much easier. So the following year, everyone, all the creative teams in Gata, Sao Paulo, in Argentina, in Mexico, they wanted to work on the promotional campaigns.

31:12And the beauty about that is that that's when creativity really becomes a business driver because the business was not looking at the awards. It was looking at the amazing business results that we delivered through those seasonal initiatives. And then, again, the flywheel starts accelerating. But it started from a moment of frustration. It started from a moment of stopping the ball and saying, well, actually, nothing is broken, nothing is wrong, but nothing is exciting. And we're here, you know, we're going to spend the time and the energy and investment. Let's try to do some good stuff.

31:50Ann Marie Kerwin: I love that do, think, feel framework. I think that's really very, it's so simple to lay out what we're going to do, think, feel. Let me tell you something more. Many times in my career, I have fallen in the trap of trying to jump from the do and the think all the way to the feel, because historically, we get excited about people feeling something about our brands. But the hard truth is that we spend a lot of time thinking about our brands, and consumers don't spend a nanosecond. We as consumers don't spend a nanosecond or a millisecond thinking about brands. So we have to make it easier for consumers to be present at that very specific moment where they're thinking about buying something or being preferred.

32:36So you cannot achieve a level of relationship with your consumer. if you haven't delivered on the basics, on the do and the think. I think that you earn the trust on delivering this very basic promise that I made to you. I delivered day in and day out. And when you do that, that's when eventually you earn the right to go and try to show that you have empathy or that you understand their lives. Every time that I tried to take the shortcut, it was a bomb. It was a disaster. And the other element that I've learned over the years is every single piece of marketing that we do, performance marketing, promotional marketing, brand communications, in the end, all of them are geared towards bringing you to my app.

33:31And every experience that you have with the app is a brand equity building. Actually, it's the best brand equity building exercise that you can have. So I don't treat my Google shopping campaigns just as performance. I am bringing someone here to the app. And the beauty about operating in the virtual world of an app is that every day we're making small improvements. So even if you came last week, I'm pretty sure that we're going to surprise you with something this week or next month or next quarter. That's why once you understand that, you fall in love with every interaction. Performance marketing is branding.

34:14promotions is branding brand equity is branding everything is branding because everything is bringing you to my app and that's the moment of truth, that's where I surprise you

34:25Ann Marie Kerwin: that's a fabulous message, I love that it's something we've been pushing in the multiplier effect, so I love the way you articulated that so looking to the future, what do you see is coming up for you for the next year, what's your biggest opportunity or your biggest challenge it's a The beauty about these businesses, both in commerce and fintech services, is that the opportunity is still massive. MercadoLibre has been around for 27 years, and you would expect a business that is 27 years to start plateauing. We've been growing north of 30 % year over year for the last 30 quarters. That's seven years.

35:08Over seven years. Seven years and a half. Actually, the last quarter we even accelerated we were closer to 50%. And you have to keep innovating. You have to keep investing. You have to keep out-competing a brilliant set of competitors. That's the beauty of operating in markets like Brazil, which are super competitive. We are playing against everyone, the local players, the Amazons of this world, the Asian players. So you're forced to innovate and improving every single day. so what I see in the next year it's a lot of activity a lot of competitive activity we have to keep improving our product as I said every single day many of the improvements are going to be like small improvements like in cycling like in swimming and occasionally you're going to do a big innovation that is going to you know give you a a discrete jump in in conversion rate or in retention rate in terms of capabilities other than what I mentioned a lot of opportunities to improving performance marketing, promotion, and branding.

36:12We are developing our social commerce capabilities. Over the last few years, we started looking a lot at the Far East, at the Asian competitors and how they are focused not just in conversion but in attention. It's a different mindset to ours. Everything that we do is geared toward optimizing for the next conversion, and that's what we built over 25 years. And suddenly, it's like, well, you have to balance conversion with attention because their mindset is, if I make you come to my app every single day for seven days or 15 days in a row, eventually I'm going to sell you something. But my priority is to create the habit of you opening my app every single day.

36:51So that requires a totally new set of capabilities. And that's when we started building our own affiliates program, which now has millions of affiliates, active affiliates across the region. We're building our creators program. We are building our live shopping program because all of these are different ways of engaging with consumers, of gaining their attention, of eventually creating that habit of opening our app every single day and eventually converting. So that is intellectually super, super interesting. And then you have, we have, it's America. We've been talking for almost 40 minutes and we haven't talked about Gen.AI.

37:33And now we're going to talk about Gen.AI.

37:35Ann Marie Kerwin: It's coming. Good for us. We like to save it. There are other things for us to talk about besides AI. That's the other element, how we keep applying AI to everything that we do in marketing. And let me say, we have the advantage. We were very early to the traditional AI wave, to the machine learning wave back in 2015. So over 10 years ago, we've been applying traditional AI. machine learning for many, many years. In many years of the business, specifically marketing, everything that we do in performance marketing has been, I would say for the last five years, has been 80 % automated using machine learning.

38:18Now we're using Gen.AI to go after that last 20 % to really optimize and to make sure that those performance marketing initiatives keep improving and keep delivering fantastic incremental results. The second is we started doing some work with Gen.AI on the creative side. We have experimented a lot. Some good things, others not that much. In the sense that, you know, probably six months ago or a year ago, I was thinking, oh, this is going to totally disrupt the creative industry. I've always been more bullish. I think we all have access to the same Gen.AI tools. So what's going to be the Delta, the Alpha?

39:03It's going to be the human creativity, the human ingenuity. So I think that we're in a world where great human ideas can get amplified by Gen.AI. I don't think that Gen.AI is going to replace those. And the actual process of amplifying those campaigns in a cost-efficient way, we're still in the middle of the journey. It's not that you turn on your Gen.AI tools and suddenly everything has been developed in a better way and a faster way and a cheaper way. You have to go through the learning curve of where to apply it, where it works better, where it doesn't, where you have to iterate. And then the third area where we have seen a massive impact of Gen.AI, which we've been working on for the last two and a half years, is all our internal processes.

40:00Everything has to do with data analysis, strategy, reporting of results and analysis of results, internal alignment and coordination. We have been able, using GNI tools, building GNI tools, to improve significantly. that. Just to give you an idea, this is a basic first step. This year, we identified 200 ,000 hours, man hours of inefficiencies in the way we were working as a marketing team, which we have changed. We have changed structures. We have simplified the way of working. We have automated a lot of those processes, and everyone is happier. And that probably was the first layer of efficiency that we can find.

40:48So I'm pretty sure that we're going to continue seeing a lot of developments and improvements in the free areas. Gen AI applied to our way of working. Gen AI applied to our performance marketing efforts. And Gen AI applied to amplifying our creative work.

41:08Ann Marie Kerwin: Well, thank you for joining me today, Sean. This is just one of our effective CMO interviews, and you can find the rest of the series at The Work Podcast, where you can find conversations with CMOs such as Procter & Gamble's Mark Pritchard and Uber's Lucinda Barlow. Be sure to follow and subscribe to The Work Podcast so you don't miss any of our upcoming episodes. Thanks for listening.