AI, No-Click Marketing, and the New Rules of Customer Acquisition

Intro 00:01
Welcome to Startup Success, the podcast for startup founders and investors. Here you’ll find stories of success from others in the trenches as they work to scale some of the fastest growing startups in the world, stories that will help you in your own journey. Startup Success starts now.

Kate 00:19
Welcome to Startup Success. Today we have Jacqueline Basulto, founder and CEO of SeedX, which I’m really excited to talk to Jacqueline, because SeedX helps startups with marketing, technology, scaling. So those are areas that are close to my heart. Jacqueline, if you wouldn’t mind giving us a quick overview of what led to the founding of SeedX.

Jaqueline Basulto 00:47
Sure. Thank you so much, Kate. I’m so happy to be here and speak to an audience that can hopefully resonate with my journey and then also what we work on, so, excited to be here for the audience too. So I am originally from New York City, and I grew up in the city, in a household with Cuban and Puerto Rican immigrant parents and family members, and really kind of believing in the American Dream that you could do anything. But I didn’t really know much about entrepreneurship at all, or what a startup was, until that life just kind of found me, honestly, is what I always say. So I was a junior at Columbia when I got the opportunity to do an internship at Google, and of course, I was so excited to go and do that. And over the course of that summer, I learned a lot about digital marketing, and I was specifically working with small businesses who were trying to figure out what their marketing strategy should look like, and a pro bono part of Google that worked with minority and women owned businesses. I was exposed to basically the gaps that exist in the market, the fact that people are so under-educated or they believe that they know less than they do about digital marketing and how to really make it work. And so when I graduated from college, I started freelancing. And I started learning more and more working with really small businesses. And then eventually I had a partner join me, my co-founder, Justin, and we became SeedX, and we started hiring little by little. Four people, 10 people, et cetera, to where we are now at 65 and so it’s really been very strangely, because I think a lot of people start a startup with like, I’m going to do this startup in mind, right? And it happened super organically, just facing challenge by challenge to where we are today. Still facing challenges and still growing.

Kate 03:13
That’s an amazing story. Good for you. Real testament to your success. That’s great. Well, I’m excited to get into it, because the thing about marketing is you have to do it, but it’s hard to justify it, because the ROI isn’t always clear. And startup founders, they typically know a lot about the product and service they’re developing, but not so much about marketing. So let’s start with the basics –the website: why it’s most important and common mistakes when, you know, building it your initial website.

Jaqueline Basulto 03:50
Yeah. That’s a great question. So I always say your website is super important because it’s your main asset besides yourself, right? So if you can imagine that you could have a salesperson working for you who embodied your company. Was always available 24/7 to anyone in the world, right? And was the thing that people went to to learn about you, that is literally what your website is, right? So I think that people focus a lot on maybe what the website looks like, right? But what I like to tell people starting a business out is, when you’re thinking about your website, really build it to be the tool that people come to and learn about you, and should really be just super education focused. Because the more that someone can learn from your website, the more that you know knowledge is marketing, basically, the more they know about you, the better, but also the more they feel empowered to make a decision before they even speak to a human or reach out to you or kind of take a next step. And I think in this era, especially Millennials and Gen Z, we expect to be able to learn as much as we can, just from the internet immediately, right? And so I always tell people to spend time really thinking about who is your customer, or who are your different customers or different stakeholders, and what kind of information would each of those individuals need, and then build out a website journey for each of those people. So if you are selling something to teachers, lawyers and doctors, a really easy way for each of those three audiences to come to your website, find the information that they need, become deeply educated about your product or your service, and then be almost at the point where they’re ready to make a decision before they contact you.

Kate 06:10
I like that. That’s really good advice around the messaging. Would you say, one of the things we’ve noticed is you also need to be mobile ready, right? (Of course.) Yeah, so you also need to make sure your website loads quickly and all of that on phones. But if you wouldn’t mind talking, do you also need to think now about AI and AI search with your website?

Jaqueline Basulto 06:36
Yeah, for sure. So of course, I think it’s a given. Now, most people are searching the internet on their phone, even if they come to your desktop website sometimes, right? There’s going to be at least a mixture, in terms of what their journey looks like. So it’s really important to have a mobile friendly website. From an AI perspective, though, something we’re thinking a lot about is making websites friendly to AI to LLMs, language models like ChatGPT or Perplexity, because there’s this thing called no click marketing, which is kind of dominating now, which is the idea that when someone is searching for something on Google or ChatGPT, they don’t even sometimes end up on your website, because they get the answer. And it’s really interesting, most of our leads now come from ChatGPT, not even from Google, because people ask ChatGPT, who are the best B2B marketing companies in Texas or whatever, right? ChatGPT will say SeedX, and then they just contact us, right? So it is important to think about that and to understand it, and that’s a huge, a huge topic, but it really comes down to having, again, a lot of content on your website that’s easy for these platforms to understand. (Okay) And so building out content like, that’s super simple, like, if I’m serving doctors, here’s how I serve them. If I’m serving teachers, here’s a different page about how I serve teachers. That way Google and also the AI bots can read it well. And then the second part of that is to the best of our ability, and it’s a little bit – this is the more difficult part, but the best of your ability to start gaining notoriety in your industry. So it really helps if you have people linking to your website content, people talking about you on Reddit, podcasts, going on podcasts and talking about SeedX, for example. Because what AI does is it looks across the Internet and it sees, you know, who is active, who is being mentioned on blogs and on Reddit as a leader in whatever space, and then it creates a list, or it creates that summary at the top of Google for the end user. And so the more that you can be in relevant places that it’s looking for that information, the better.

Kate 09:30
Fascinating.You did a great job of walking us through, like, why your content and messaging is so important on your website. Sounds like even more so nowadays with AI. How do you measure success with your website? Like, are there tools that founders can use, or do you just look at lead flow from your website? Like, how do you help your clients measure success with the website?

Jaqueline Basulto 09:55
Sure, there are so many different tools, I would say, like at the most basic level, it’s looking at whether people are converting. So if you’re an e-commerce website, do people, looking at the basic analytics, either on Google or Shopify, are people converting when they’re going from the product page to the cart? Where are they stopping in their journey, and then trying to figure out what on the website may have stopped them? Or if they are converting, that’s a pretty good sign that the website is probably doing well, right? (Yes.) But to get more specific about that, there are tools like, there’s a free tool called Microsoft Clarity that we use, okay, there are tools like Hotjar, which basically give you a lot of insight into what’s called Conversion Rate Optimization, or CRO. And basically those tools allow you to see sessions like actual session data. Yeah, if someone comes to your website, where are they stopping and then jumping off. And that can also help you gauge whether you have the right people on your website, because not getting conversions can mean one of two things. It can mean one, your website needs help, or it can mean that you’re sending the wrong traffic to your website. So I’ll give a quick example. Years ago, like five years ago or more now at this point, we were working with a New York City private school that was marketing to potential, prospective students. And anyone who knows New York City knows that the private schools cost like the amount of college, like $60k year. So we would look at the Hotjar, they were using Hotjar, Hotjar sessions, and we would see that people were reading the content for like five minutes, super engaged, and then as soon as they saw the price, they were bouncing off, right? But the problem wasn’t that the content wasn’t good. People really liked the educational values and system of the school. They just were not qualified price wise. And so the way that we changed that outcome was to start including pricing, or including like, signifiers of the price in the ad and email campaign, right, so that people who chose to click on it already knew this is not a cheap school.

Kate 12:49
This is going to be expensive. Yeah, right, yeah.

Jaqueline Basulto 12:52
So that actually led to more qualified traffic on the website and more contact form conversions, like more people actually signing up for tours of the school. So that’s a really good question in terms of like, how do you know if it’s successful? Because sometimes your website is actually great. It’s just the people you don’t have the right people on it.

Kate 13:16
Thank you for walking us through that. That’s why I wanted to touch on that. Because, you know, way, way back in the beginning, it was all just about traffic, traffic, but it’s, it’s really like you said, traffic that does something on your website, right? And if it’s not doing anything, then it’s not working. So it’s like taking that extra step and looking at conversion, which gets into another important topic, and that’s just customer acquisition. There’s so many channels out there, you know, how do you help your clients focus in on, you know, the costs around customer acquisition and how to pursue a strategy there?

Jaqueline Basulto 13:57
Yeah, well, I would say, first, I’ll start, like at the beginning. I think one of the most important things for startups and even the owners, founders, leaders at larger companies, is to think about what you’re saying, like, do the marketing costs make sense? And that’s something like a lot of people are thinking about but I would say the majority of the people that I meet with, no matter what size their organization is, they haven’t gotten real clarity about that, and that’s so important. Because you have to know what costs even makes sense for me to acquire a customer or a client at. Because if you’re selling a $40 product, but it costs you $60 to acquire a customer and then they never buy again, because you have a product that people only buy once, that’s a recipe for failure, right? And so even if Meta or Google are telling you, well, your ads are performing so great in this platform, it’s not performing great for what the business needs, right? So that’s like the number one most important thing that people just skip over when it comes to marketing, but the way that we align our clients is, first, we try to get some sense of that, like, what is your margin on your product or your service? What does it look like? It’s a little bit hard to get, like, industry averages, but right on what we know, we try to tell them, like, you know it’s unlikely you’ll acquire a customer for less than $20 or less than $200 depending on what their company is. And then usually the two best places to start acquiring customers are Google and Facebook and Instagram, just because they have the most diverse platforms, the most different types of people. You know, Facebook has billions of users from every single background, and so it’s usually a safe bet that we can find someone’s customer Facebook. So, yeah, so usually we’re using that platform first or Google, because people are actually searching for whatever product or service. And so we will build out campaigns attempting to meet that cost that we discuss. Of course, there’s a lot that goes into the campaigns, but we, at the end of the day, we need to make sure that they are acquiring customers profitably, or they know if they’re not, if they choose to, like not be acquiring them profitably, they know the timeframe in which they will become a profitable customer.

Kate 16:49
Got it, okay? That makes sense. And would you say Facebook and Instagram, even for B2B?

Jaqueline Basulto 16:56
Yeah, I think it’s a really big misconception, because if you think about it, something I hear a lot on sales calls, when I talk to B2B company marketers is, well, my audience isn’t on Facebook. And it’s just not true, like I’m a B2B purchaser, I’m on Facebook and Instagram, right? I’m a if you’re a doctor, you’re on Facebook or Instagram. Any professional is also a person. And so I think that people confuse that a lot and that people are more engaged, typically on Instagram or Facebook, than they are on LinkedIn with ads, because when you’re on Instagram, you’re looking at funny videos, looking at your friends, if you see an ad come up, you’re not as defensive. On LinkedIn, you’re in work mode, and you expect that people are going to be selling to you. So of course, there’s very variability, but we’ve actually seen more success for B2B clients, across the board, for the most part, on Facebook and Instagram.

Kate 18:10
Wow, that’s interesting. What about email marketing? Is that done? Is that dead?

Jaqueline Basulto 18:19
No, of course, no. Everyone says that, but everyone says everything is dead. But when it comes to email marketing, I think what is dead is just doing it in a spammy way or in a way that doesn’t give value. So again, when we are approaching like when we’re approaching email marketing, it’s not like to sell something, it’s to give value to the customer, right? So we work with a honey company. How can we be educating people about the properties of honey, or how they can use this honey product for their dog, giving them recipes, things that people actually want to be engaging with? (Okay.) Or if you’re B2B company, giving them valuable insights, giving them some form of value that makes them want to open the email and then feel some kind of positive association with you. So I think that’s important, and then the content is important, and then it’s important to know when to send the email, right? So at what point in their journey, do you send an email? Do you send an email the day after they’ve purchased to ask how the experience was? And then you think about frequency. Like for some of our clients, we have segments like people who don’t engage much, and then VIP customers, people who want to hear from us all the time. And so maybe you send your VIP customers multiple messages a week, but for your unengaged audience, you send less frequent, really valuable emails, like I was saying. So it really gets down to just like anything being smart and strategic about how you’re actually interacting with people.

Kate 20:22
This is great that you’re walking us through all of this, because so many founders don’t understand all of this. It is a lot. And like you said, the media is always saying things are dead and whatever. I’m seeing a lot about like content and the value that you provide, like it’s on gotta be there on your website. It’s gotta be there in the emails that you send to make sure that they’re valuable. Getting back to that, do you carry that through in your advertising on Facebook and Instagram? Is it really important to start with the value proposition for the person you’re trying to reach, to kind of include that messaging in your ads?

Jaqueline Basulto 21:06
Yes, of course. And I think one of the great things about Facebook and Instagram is that you’re not just posting one ad, so it’s not like a one size fits all ad, right? Like, if I’m a company like the honey company, and I’m a honey that could be used for immunity, for kids and digestive problems, and dog dog paw injuries, like hundreds of use cases, you can create an ad for each of those audiences. So really honing in on those specific value messages for each sub-audience is a really smart way to market too. Now because you we can, and I think more and more people expect personalization and and they react more to like I have, you know, if I have a digestive problem, that’s a much stronger reason for me to buy this product than just seeing that, you know, just seeing a generic like this is a super food. (Right, right.) So, that problem works a lot more if, if you’re talking about a digestive issue that I’ve been dealing with for years.

Kate 22:27
So that proves a great point that you can do some really good targeting on those platforms too, which is super important. So, okay, so I like this a lot. You’re helping everyone with their digital marketing. You’ve got the website, you’ve got advertising, you’ve got kind of your email plan for when you have their email, anything else we’re missing in kind of that first digital presence?

Jaqueline Basulto 22:59
I would say those are the three most important, because the website, the ads help bring the right people to the website, and then emails help, if you have, you know, if you have 100 people visit your website, not all of those people will purchase, obviously. A small fraction of them will. A slightly larger percentage will sign up for your emails. And so it’s important to have email activity because you want to be continually converting those people who haven’t purchased yet and your current customers. So I always think those are the three most important things to start with, and then beyond that, there are other things that you can be doing, organic social media, even more aggressive search engine optimization. There’s always more to do.But those are the core.

Kate 23:56
Those are the core. Before we wrap up, what about gated content to try to get their email address? I still see websites trying to do that. They’re like, Oh, you want this. You have to give us your email address. Versus like the softer email sign up where it’s like, sign up for a newsletter and get offers and discounts. Which approach do you think is best?

Jaqueline Basulto 24:20
I think it depends on the kind of business you have. So usually for e-commerce or consumer products, it makes sense to offer someone 20% off their first order, because that’s a huge value-add, and it comes back to what’s valuable for your audience, right? So if you are, you know, offering 20% off on something people want to do anyway, shop for clothes, right? (Yes.) It’s an easier Yeah, sure you’re taking my email, just in case I buy something, right? But if you’re a B2B, products that can cost, you know, $100 a month to 1000s and 1000s of dollars, it’s a much longer marketing process and they can’t offer, you know, a 10% discount. That doesn’t make sense. So it makes more sense to give people something valuable, like a webinar or some kind of report on like, here are the 10 things you need to know about this industry in exchange for an email so they can continue to follow up with you, because they need that email because basically it could take months of follow up for that person to actually purchase. So it depends on what the business is, but in either case, I think the offer has to be valuable. For e-commerce companies, sometimes I have clients say like, well, can’t we just offer, like, a 5% coupon? And I’m like, no, because no one cares about 5% off. So, we might as well just offer nothing or write something else, like offer a free beanie or something. And then on the B2B side, you can’t just offer, you know, garbage piece of content, and it has to be something that people really want to know about. So above all, again, the value of the content or the offer is the most important in either case.

Kate 26:27
It’s been a continuous theme through this whole thing. This has been so helpful. I know our listeners are going to really appreciate this episode, because you really know what you’re talking about. I am impressed, and you walked us through it so well with the foundations. Thank you. For those listening, can you tell us just a little bit more about SeedX and where they can find you?

Jaqueline Basulto 26:52
Yeah, sure. So we’re a team of 65 now, and what we do is essentially what I’ve been talking about on this podcast. So we take a business first approach, so we really get to know the business we’re working with, the team, the costs, the industry, and then we help map a growth plan and create a growth system around the initial needs of the company. And then we can scale that over time. But our team is made up of two layers, so business strategists, generalists, who understand how everything goes together, all of the financials, et cetera. And then the second layer is specialists in all of the areas we talked about, so website developers and designers, SEO specialists, ad buyers, ad creatives. And so essentially we can be someone’s outsource marketing team, or we can fill gaps that the marketing team has. So sometimes people have a great content writer, but they don’t have someone who can string all of these pieces together. And so we really work to help fill out our clients teams, meet them where they are, and then help them get to a place where they can grow sustainably. And I’m happy to have a discussion with anyone who’s interested. You can contact me on LinkedIn or just go to our website, seedx.us.

Kate 28:22
Excellent. I think for people listening, you know, I would take note of that whole you know, you can fill-in in marketing departments and be the marketing department in a sense for a growing startup. I mean, if I was a founder, I would go in that direction, for sure. Why guess at something so important? Bring in experts. Yeah, makes a lot of sense. Thank you for being here today. Really helpful, really great episode.

Jaqueline Basulto 28:51
Great conversation. I hope it’s valuable.

Kate 28:54
Thank you. Thank you so much.

Intro 28:57
You’ve been listening to Startup Success to make sure you don’t miss out on future episodes. Subscribe to the show in your favorite podcast player. Like what you hear? Tap the number of stars you think the show deserves in Apple Podcasts. For more tools and resources for your own startup success, check out burklandassociates.com. Thank you so much for listening. Until next time you.