AI, AGI & Stablecoins: Raja Rajamannar on the Future of Marketing, Jobs and Money

People are also creatures of comfort. They gravitate to things which make their life easier. They avoid any kind of pain. They seek to avoid any kind of pain and they seek any kind of pleasure. So, between pain avoidance and pleasure seeking, actually AI simplifies a lot of life. Takes a lot of pain. Takes a lot of friction. It's very tempting.

Hello.

Nice meeting you, too.

Yeah. So, if you look at the theories and principles of marketing, they were all formulated about 60 years back by the likes of Dr. Philip Kotler. When those theories and frameworks were formed, there was no internet. There was no data analytics. There was no mobile phone. There was no social. There was no AI. My quest was to say that are marketing principles and theories so timeless that they remain steady and constant over decades or even centuries or do they evolve and change as things change around them? If you look at something like Newton's laws of gravity or Newton's laws of motion, they don't change with time. They are what they are. Is marketing like that or is it different? I quickly came to the conclusion that marketing is very different. It's very dynamic. It has to keep evolving. It has to keep really transforming itself depending on how the situation is actually changing. So, that is where the whole concept of quantum marketing came about. A new way of thinking about marketing. A new set of principles and theories for this new age marketing with fields like neuro-marketing or behavioral economics, color psychology, the science of anonymity. So, there are so many areas that are all integrated into this entire paradigm of quantum marketing. So, marketing has gone through several paradigm changes. The first paradigm was all about product marketing. The second paradigm was all about emotional marketing. What that means is in first paradigm the belief was people are rational in their thinking and logical in their actions. You give them the best product with a great packaging at a good price and easily available everywhere. That is the product which will be the biggest winner in the marketplace. And that myth prevailed for the longest time, that is paradigm one. Paradigm two is where people recognized, 'No, purchases are not our consumers are not logical or rational. They're actually irrational. They're illogical in their actions.' And they're driven by emotions and feelings. And that was the beginning of the second paradigm of marketing. The third paradigm of marketing was all about data and digital. So, internet came about in the mid-1990s and that third paradigm brought in the concept of digital marketing, data-driven marketing, precision targeting, measurement of ROI, return on investment, and so on. Then came the fourth paradigm in 2007 with the launch of mobile phones. The Apple iPhone got launched in 2007. And you got the scaling of Facebook. So, suddenly we came up with a new paradigm where you are talking about people being engaged 24/7. You know where a person was based on location-based tracking. And you had social media where people were actually being influenced a lot by each other and discussing brands and making brand choices based on the influence of other people in the social media. So, you needed to really reinvent marketing for that paradigm. That's the fourth paradigm. Now, we are at the fifth paradigm. The fifth paradigm is driven by a tsunami of technologies, a deluge of data, and tectonic shifts in culture around the world. These three together are ushering marketing into the fifth paradigm, and we are at the beginning of that fifth paradigm now, which is where it's all about quantum marketing.

Because its potential is mind-blowing. We never had any other technology, maybe electricity was the previous one. We did not have any other technology which is going to have such a wide-ranging impact and so rapidly. Right? If you look at the number of people who adopted AI or signed up for ChatGPT or whatever is the AI platform that they want to have, the speed is absolutely mind-boggling. Speed of adoption. And the capabilities, literally you study a particular model of AI this week. By next week, this has become obsoleted and a new model has come. The change is so dramatic. And the impact can be so wide-reaching. Right? Like, for example, you look at copywriters in the agencies today. AI is able to create as good, if not far better, copy and multiple versions of that, what would take a copywriter maybe a week to turn around, this does in a matter of a few minutes. It gives you more choice, speed when speed is critical in terms of go-to-market. Everything gets done like that. Whether it is insights that you gather, and AI is able to get insights which human brain cannot, or existing methodologies cannot. Every single aspect of human life, every single aspect of marketing is going to be disrupted with AI.

It is some boom and some doom. I think the boom is going to be very pervasive. The doom is in terms of traditional skills which are automatable, or which can be done by AI, and there are a lot of them. That's a doom for them. Like in the field of marketing, there is so much amount of automation that you can do and disintermediate people altogether powered by AI. Like I was giving you the example of copywriters. You are talking about basic creatives. You are talking about campaign managers. You are talking about campaign tracking and measurement of ROI. You needed people to actually do all these. Now, we can automate the whole thing powered by AI, and then you are done. Where will these people go? It's a doom for them. It's easy to say you need to upskill yourself. Because AI will throw up so many more jobs. Easier said than done. If I am a copywriter who is fantastic at what they do at the age of 55. How am I going to upskill? And what am I going to upskill myself to? It's not an easy thing. Data analytics. Now, I have seen the level of disintermediation of data analysts. All the lower order analysis is now being done by AI better than human beings. AI doesn't take rest. It works 24/7. It gives you everything absolutely fast. There is no unionization of AI employees, so to speak. So, it offers so many positives from a CEO perspective or from a CFO perspective. They said, 'This makes a lot of sense for us to go.' But people who are in those fields, they're going to be displaced. And that's it. That's it. Doom for them.

It depends on what you learn because what you learn this week is not necessarily... few months back, prompt engineering was the big thing. Now, prompt engineering doesn't have the same prominence. Because you ask the AI, 'How do you want me to prompt you?' It tells you what the prompt is. You copy it and paste it back into the same chat. And it gives you a fantastic response. So, now do I need to be a prompt engineer anymore? Do I need to study prompt engineering? I don't have to. So, that's another key thing. So, it's not only upgrading your skills, but upgrading your skills to what? What is going to be sustainable? This is a period of flux. And we have to be very clear what is going to... We are not very clear at all what will sustain and what will not sustain.

I see it going very, very, very far. So, there is a fundamental change in people's behavior for adopting these agents and feeling comfortable to let the agents do things on your behalf. And if you also delegate decisioning to the agents and execution also to the agents fully, then you are literally abdicating your entire decisioning to the agent. That last part is where people will probably hesitate because there is a question of how dependable is it. Will it get me into trouble because it hallucinates or it... I wanted to buy one bar of soap or one bottle of shampoo, for example. Suddenly, it might decide in its own wisdom there's a fantastic sale happening. Let me buy a thousand of these so that this guy has to never buy any more shampoo in his life. It could be a perfectly logical decision, but not in line with what I want. So, there are things that can still happen. And how reversible are these? And what will happen to my data? How secure is it? You keep seeing about data breaches every single day. Now, when you're putting your whole life in front of an AI engine and it gets leaked into the public domain, you are in really big trouble. So, there are those kind of apprehensions which will keep people sort of hesitate before they absorb and before they adopt and jump with both their feet into this whole game. On the other hand, people are also creatures of comfort. They gravitate to things which make their life easier. They avoid any kind of pain. They seek to avoid any kind of pain and they seek any kind of pleasure. So, between pain avoidance and pleasure seeking, actually AI simplifies a lot of life. Takes a lot of pain. Takes a lot of friction. It's very tempting. It's like passwords, right? Now, when you have passwords, people why do they use the same password and a standard password like password 1 2 3 4 5 or things like that because it's a balance of comfort and ease of convenience.

People who have grown up in and been native in technology will be the earlier adopters. People of my generation, people of my previous generation and the previous generations, they are a little bit more cautious. They're trying to still understand and their mental plasticity also comes down a little bit. So, for them, it's very difficult to keep up with the pace of change which is happening on a weekly basis if not on a daily basis. And that's a really big thing for them to grapple with. But, even they seek convenience. Even they seek comfort. And if they say, 'You know what? You don't have to read so many emails. The agent will automatically filter your emails, respond to the emails of all the useless things, only for your immediate family members or some important VIP connections. I will draft answer and give it to you. If you approve it, send it. Otherwise, you edit it and send it.' I'll take it in a heartbeat. Because I get bombarded by so much amount of useless email. Even if I just spend 5 seconds on each, that's a waste of time.

Hugely. So, when agents are coming all over, in fact in my book which I've written in 2021, it was before gen AI and all that were there at that time. I called Quantum Marketing, the name of a book is it's became a Wall Street Journal bestseller, got published in 40 languages, won six awards, international awards, and it's being taught at 300 universities around the world.

Television series called Quantum Marketing with Raja Rajamannar on Bloomberg Originals. Being broadcast I believe in 55 countries. We finished season one and now we are shooting season two. The point I'm trying to drive at is when you have to do marketing in this new age where people are going to delegate a lot of their decisioning to agents, how are you going to appeal to the human beings because human beings are not even seeing that stuff. It is the agent who is seeing. Do you have to spend time on the aesthetics that I spend a lot of effort on? Do you focus on psychology? Do you focus on sociology, anthropology, all these good things or you don't have to worry about them anymore? And I simply optimizing my algorithm to appeal to that particular agent which the consumers have delegated it to. That's one challenge. The other side is as a marketer, do I need to delegate my entire marketing activity to a machine and let the machine do everything. I don't have to worry about it. So, for example, at Mastercard we created a digital marketing engine. It looks at the signals in the social media, projects or predicts what is the next micro trend, a trend that lasts for less than 3 days. For the theme of that particular micro trend, it says what is the most appropriate communication from a Mastercard. It creates an ad, does AB testing to optimize, buys media, serves the ad, measures the response, gives me the ROI. It does everything end to end. So I don't have to really worry about it, right? So it's doing. Now the thing is when it now becomes a situation of a machine is marketing to another machine. The marketer's machine is marketing to the consumer's machine. It's a machine to machine marketing and I got a full chapter on this in my book.

I call it machine to machine marketing, which is basically bot to bot marketing, right? And that is something which requires you to rethink and reimagine everything. Interestingly, the way the delegation is going to happen from the consumer to the agent, depends on how much the agent understands the psychology of the consumer to be able to give the right thing. So for example, if I ask the agent to buy an aftershave lotion, it might say, 'Oh Raja, I got you the best aftershave lotion. It cost you only $3.' I said, 'I don't want to use this. I want something else.' Which means it's learning then from me as to what appeals to me, what doesn't appeal to me. So it is codifying my psychology into itself. Yes. And such pulling products. So I still need to understand the consumer as a marketer so that I know it is a consumer's eventual psychology which is being codified into their agent and so I have to make the same appeal to that agent. So it's an intermediary but working on the same codification of the consumer psychology. So it's going to be pretty fascinating and not many companies have cracked it yet. I don't know.

Oh, yeah. Absolutely.

Yeah. See, look at this way. There are so many pain points that fiat currencies and the current financial systems don't address. Take a situation. If I want to send money to my sister in India, I would have sent her $1,000. What is the standard process? I go to MoneyGram, Western Union, Remitly, or one of these companies who are money remittance companies. And then they are so... Or I go to my bank, say JP Morgan Chase or Citibank or whatever. The whole process is so inefficient right now. There are intermediaries and each intermediary take their cuts. And each time there is a currency conversion, there's a loss of value in favor of the seller, not me the buyer. So, when I send my money, eventually what my sister gets is about $930. Almost 7% can go to the intermediaries today.

What a hell of a lot. If on the other hand, I send it through a stable coin, the stable coin pegged to dollar, if I send it or pegged to dollar, I send it to her, I pay a few pennies, a few cents. And when she receives there, she can encash it into the local currency at the most efficient market exchange in terms of pricing. So, she ends up getting maybe around $998 or $998.50 out of $1,000. So, there is an inefficiency that's being addressed by stablecoins.

You're talking about agents from the consumer side or from the marketer side?

For the consumer side, they have to see... We need to understand what is it that they need. They need trust. They need transparency. They need dependability. They need reliability. They need access. So, for example, if there is a currency which is out here which is not widely available in India. There's no point in me sending this over there. Right? So, the agent needs to know what is the local environment there. Her agent needs to know. And her agent needs to tell my agent as a sender saying that don't send me in this, but send only in one, two, three currencies. And then my agent then will look at the market and say which is the most efficient transfer to my sister in India and pick and choose those and then send it in that fashion. And how does she get notified? The notification is done by the agent. Hey, the money has been just sent right now. You should be receiving so that everything happens through a combination of making the right choice on the one hand optimizing the choice for the sender and for the receiver and also in terms of simplifying and making the whole process frictionless for her and for me, too. Right? This is one kind. I'll give you a different example. Now, if you are living in one of the countries, say like Turkey or one of the Latin American countries where maybe like Argentina where the inflation rate is going through the roof. They get paid in the local currency there. And what they take now, next week the amount is valued lesser. But their salary doesn't go up next week. Salary goes up once in a year or once in 6 months. But then the prices are going up literally every day or every week or whatever it is. To protect the value, they immediately convert from that local currency into a stable coin. So, that holds, retains value. It's a real function that is there. And so, the applications as I see, they're going to be pretty wide and pretty significant. Yes, there are speculation aspects, speculative aspects which are there for the cryptocurrencies and I'm talking more about stable coins here than the floating coins.

That's a huge challenge because unfortunately, every tool has two sides to it. If I am a criminal and I'm trying to launder my money, could this provide the path, easiest path to convert whatever it is, black money into crypto coin and on the other side take it in the white form or whatever it is there. Regulation has to be on top of it. The thing is big regulations are just sort of making baby steps right now. I would still say, right? And also you need to make sure that the regulations are not only preventing this kind of nefarious activities and making sure that everything is clean, they should also make sure that the process doesn't become so laborious either for the customer or for the institution that it seems to be such a useless exercise to go through because it's so cumbersome and so full of friction. So, it's a very fine balance for regulators to see. On the one hand, there has to be regulation, it's not a free-for-all. It's not like a... you know, what do you call free-for-all? There has to be some method, there has to be organization. Organization as in not company, I'm talking organization of the entire ecosystem. And at the same time it needs to make the entire thing so bureaucracy free that this whole ecosystem thrives. Easier said than done. But that's something which we have to... It'll happen eventually.

When I wrote my book, I said 50 years.

Today I'm saying probably 3 years.

3 years.

Wow. Yes, 3 years. I think AGI will be here.

Because almost it's scarily close. And again, I don't have any crystal ball. But having spoken to some experts in the industry, and who are at the cutting edge, they understand a lot more than I can even begin to learn. Their view is that we are just around the corner. In fact, some of them say it could happen in 1 year. But I would say 3 years is probably the... I would bet on 3 years.

Thank you for sitting down with me. Really appreciate it.

Thank you.