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Ads, Context, and Identity: The More We Know about Anthony, the More Valuable the Click

Tim Sloane by Tim Sloane
April 2, 2021
in Analysts Coverage, Artificial Intelligence, Commerce, E-commerce, Identity Verification
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synthetic Identity

synthetic Identity

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In this article Holler CEO Travis Montaque makes a fascinating statement:

“I believe that the future is context, not identity,” he said. “Because I don’t really need to know about Anthony, I just need to know someone is in need of lunch.

The statement can be perceived as true or false based on the perception (dare I say context) of the reader. The ad agency may perceive this as accurate, but as a payments market researcher I say its dead wrong and may indicate Travis doesn’t fully perceive the value of the data Holler has.

In the old days advertisers only cared if an ad would sway a broad spectrum of people that have traits similar to Anthony’s, to buy a product. In that case why care about identity? But now we advertise to the individual and yet it appears we still don’t care if that individual is a legitimate buyer or not.

It appears advertising has ignored the fact that after convincing Anthony to buy jewelry, Anthony needs to pay for it. To the retailer identity is suddenly far more important than context and retailers pay handsomely to make that determination. If Holler cared more about identity it could begin the process of separating the wheat from the chaff and lower the effort merchants go through for fraud prevention, which would help drive higher margins. It appears to me that ad agencies that profit from the click are in a race to the bottom:

“So Holler works with partners like PayPal-owned Venmo and The Meet Group to bring more compelling content into the messaging side of their apps — or as Montaque put it, the startup aims to “enrich conversations everywhere.”

There’s both an art and a science to this, he said. The art involves creating and curating the best stickers and GIFs, while the science takes the form of Holler’s Suggestion AI technology, which will recommend the right content based on the user’s conversations and contexts — the stickers and GIFs you want to send in a dating app are probably different from what you’d send in a work-related chat. Montaque said that this context-focused approach allows the company to provide smart recommendations in a way that also respects user privacy.

“I believe that the future is context, not identity,” he said. “Because I don’t really need to know about Anthony, I just need to know someone is in need of lunch. If I know you’re in the mood for Mexican food, I don’t need to know every aspect of the last 10 times you went to a Mexican restaurant.”

Holler monetizes this content by partnering with brands like HBO Max, Ikea and Starbucks to create branded stickers and GIFs that become part of the company’s content library. Montaque said the startup has also worked with brands to measure the impact of these campaigns across a variety of metrics.

Holler’s content now reaches 75 million users each month, compared to 19 million users a year ago, while revenue has grown 226%, he said. (Apparently, last year was the first time the company saw significant revenue growth.)”

Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group

Tags: AIArtificial IntelligenceidentityMarketrevenueVenmo
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