Freepik's Álvaro Castañeda on Creating Relevance Through Personalization

00:45
Álvaro Castañeda
Hi Max, looking forward for the chat. 

00:48
Max Koziolek
Sounds good. Before we get started, why don’t you tell us a little bit about more about yourself, your background and how you ended up in your current role. 

00:55
Álvaro Castañeda
So I’m a business administration degree. I started my career, I think it was already twelve years ago, I started my career in United Kingdom, Liverpool. I did an internship over there. I was very looking forward to start a career in marketing, but I really didn’t know if I was 100% focusing marketing because I also wanted to do some statistics. I liked numbers. So I started my career in a company focusing CRM in the loyalty department. And since I started my career up there, it was like a game changer when I was introduced to CRM because for me it was like a perfect mix. It had the creativity to be able to create marketing campaigns, but at the same time I was able to measure the success of the campaigns. I was able to create segmentations to analyze customer data. 

01:53
Álvaro Castañeda
So for me it was like the perfect mix. So thanks to this internship that I did in a small company in Liverpool, I started my career. Then I found a job in London. It was within the igaming industry. This company was games cease. They were looking for a person to focus within the spanish market because they were going to launch an operation in Spain. They were looking for someone to take care about the entire customer loyalty, the lifecycle and so on. So for me that was like the perfect growth for me. I had the spanish knowledge about the market. I already had my six months experience back in the intern company and that’s how I started my real professional career. I spent six years working in London. So I was like the head of the CRM operation. 

02:47
Álvaro Castañeda
At the end of the six years in Gameseas, focusing on the spanish market. And for me that was like an amazing experience because the igaming industry, it’s the perfect industry. For customer loyalty and CRM, it has so many different opportunities that you can develop. When working with CRM strategies, you have a lot of bonuses, tools, promotions, many different segments. Customers are very loyal. So for a CRM position, it’s like a dream. After this experience in London, I moved to Madrid. I was also the head of the CRM department for another igaming company. After that, I found the opportunity to come back to Malaga, my hometown. Working at Free Peak, for me it was like the perfect job because free peak is like a unicorn here in Malaga. 

03:41
Álvaro Castañeda
It’s crazy how from such a small city, very talented and a fast growing company arrived at free peak. At the moment, we have more than 40 million customers every single month registered. So from a CRM point of view, it’s very easy and at the same time it’s very difficult because we have millions of customers which could be quite simple to monetize. But due to our business model, which is we have the premium model, but mainly it’s premium, there is a lot of potential to develop so many different CRM strategies. So yeah, that’s been me till now. 

04:18
Max Koziolek
Amazing journey from Spain to the UK and back to Spain now at Madaga, which is becoming a tech hub, which I didn’t know. Very cool. But you said prepack has millions of customers and you’re saying that’s great because there’s a lot of potential to drive revenue from CRM. You’re also saying it’s difficult. What makes especially the premium part difficult? 

04:40
Álvaro Castañeda
So the way we see Freepic as a company, our value, what we want to do with our customers is to help our customers to create great design faster. So that’s like our mission. And in order to help our customers to create great design faster, what we can do is to help them with a lot of free resources. So in freepic we have millions of assets that a customer can use free. In fact, you don’t even have to register if you want to download one single resources or two resources. But then while you start using our product, you want to get better tools or if you want to get more sophisticated resources, we have the premium subscription. But of course, this premium subscription, it’s only for those people that they do find free peak useful for a daily routine. 

05:32
Álvaro Castañeda
So those are the customers that we target to create segmentations, to become like a proper loyal customer. We have a lot of customers that they will go to Freepick, they will download a resource and they won’t come back because that was a unique need that they had. And for us, it’s fine. It’s perfectly fine. But we will target those that we see that they have potential to keep coming back, and we will build this strategy based on those customers. So, yeah, we have millions of customers, but the ones that we target and the ones that we put all the effort are the ones that we see that they have potential to become a premium customer. 

06:09
Max Koziolek
When does a customer become for you customer? Because I can imagine you have a marketing team, maybe, or performance marketing team or whoever that is. They are driving traffic and leads probably to the site. And when do I become a freakbake customer? And you are taking over and you’re responsible for converting me. 

06:31
Álvaro Castañeda
So from the CRM point of view, you are becoming a customer when you register. So when you are giving your email, that’s for us. When you become a customer, then once you become a customer from our CRM point of view, we’ll try to get you engaged with our platform. It doesn’t make any sense if I start sending you premium content or premium benefits if you are not using the premium model, it would be a waste of time and money for us. So what we try is first we try to target you with our freemium content. We try to engage you. So you start using our free resources, you will start downloading, testing the product. I think it was like six months ago we launched an editor. So now you can edit as well the resource in freepik. 

07:18
Álvaro Castañeda
You don’t have to download it and go to Photoshop. So the first step that we follow in CRM, it’s okay. You are here in freepik. Welcome to Freepik. And we’re going to try to teach you how to use the platform, the way you can download, the way you can use our filters to better search what you’re looking for, the way you can use our editor, or even the way you can start using our artificial intelligence tools. Now you are able to also generate images using AI. So that would be the best onboarding that we can do to try to make you understand the way that the platform can improve the way you work. From a graphic designer point of view, from a student, a professor, a marketeer, and once you start using our platform, you start getting the value out of it. 

08:06
Álvaro Castañeda
Then we will try to promote our premium content, our premium features, and so on. But it’s very difficult to try to present the premium benefits if you are not even using the premium stuff that we have. So if you can download ten resources free per day and you are not downloading it, we’re not going to make an effort to sell you the premium product, we will start personalizing content for you. We will start teaching you how to use the platform, how to download our best assets. And once you start downloading, we will start then pushing for the premium model. 

08:42
Max Koziolek
You mentioned the word basically onboarding, right? So it’s more or less an onboarding where the educational part is the most important one before even the rest comes out. That do you personalize already the onboarding based on segments and so on, or you keep that for later? 

08:58
Álvaro Castañeda
No, I mean since the minute that you register at Freepik, we start personalizing the journey. So when you register first, you’re going to be asked what do you want to use Freepik for? So are you a student, are you a graphic designer? Are you a web developer? Also from that point we’re getting data about where are you located, the first click that you do in the website or this first free resource that you download. And from that we’re going to start personalizing the journey. So for example, if you’re a customer that you register, you click in a specific resource but you didn’t finish the download. 

09:39
Álvaro Castañeda
We’re going to start the onboarding by presenting recommended content based on what you clicked before or probably based on your local area if there is any specific celebration or event in the states, for India, Brazil, which is our main countries. So yeah, for us the data is a key element in our CRM strategy. We have developed many different API calls so we can start personalizing content based on individuals, not in segments. So yeah, we try to personalize as much as possible the experience in our platform. 

10:17
Max Koziolek
Interesting. Do you mind sharing how you do this from millions of users? How you do that from a data and tooling perspective? I mean is it everything goes into segment and Salesforce it goes to data lake goes back and then primary channel is email for communication or do you other stuff. What do you think is the really up to date tech stack when it comes to that? 

10:46
Álvaro Castañeda
So before we start using any CRM tool, the first step is to really align the data that we have in our back end. So our data team start getting all the data and doing like an initial segmentation based on different profilings. Once we get this basic segmentation, we then move the data back to Salesforce, which is the CRM platform that we currently use. Then in Salesforce we have developed different API calls to our platform. So based on the API that we developed, we can recommend personalized content for individuals. So for example, if you clicked on the 1235 id resource, we will be able to personalize recommended content based on the specific click that you did. Based on that. Every single email that we built is dynamic. We build all the emails with personalized language, personalized content blocks. 

11:46
Álvaro Castañeda
So for example, if you are onboarding, let’s say we want to introduce features that you haven’t used in our CRM. We know that, for example, you have used a search engine. So you have done a search, but you haven’t used any filter. Filter is very important because it’s the way that you can find the perfect asset. If you do a generic search, it’s going to be more difficult that you find what you’re looking for, even though in the last couple of months we have launched an ai powered search. So now it’s way better to find resources. But filters are very important for us in the onboarding. We will start introducing the way we can, or you can start using filters. 

12:30
Álvaro Castañeda
If you have already used filters, as it’s going to be everything dynamic, you won’t see the way to use filters, you probably will see the way to save assets or to create collections and so on. So the way we built it’s entire dynamic email that is going to be personalizing the language, you’re going to be personalizing the contents that you are going to see, and it’s going to be personalizing the image as well. So based on the resources that you have downloaded or the resources that you. 

12:58
Max Koziolek
Have clicked, is the data team you mentioned also reporting to you or is it a different team? 

13:04
Álvaro Castañeda
No, the data team is reporting to data. But the way that we are building the teams at Freepic is based on, we call it mission driven teams. 

13:19
Max Koziolek
Okay. 

13:20
Álvaro Castañeda
For example, we have the mission of retaining customers. Even though we are the CRM team or the retention team, we are able to build mission driven teams with professionals from other teams. A unique goal. And the goal is the retention. So the team will have a data person, a technical person, product designer. And our mission is to increase the retention of the customer. Even though we are different departments, we have one mission, we have 100% dedicated resources in CITIC goal, and that’s something that we implemented one year ago, is actually working really good. I think the way that companies used to work in different departments, which they don’t talk each other, it’s something that is going to be evolving and changing. At the end of the day, the company needs to have different goals. 

14:14
Álvaro Castañeda
One probably is acquisition, the other one is retention, conversion, monetization and so on. And the teams need to talk to each other, become like multidisciplinary teams. That’s the way we have organized the company. 

14:29
Max Koziolek
It’s a very good idea to go for mission driven teams because I think retention and also CRM, especially for you, I think that’s one of the big revenue drivers. When everybody, I put my email address down, it’s already becoming a customer or the CRM team. And the mission driven team is probably responsible for the majority of the revenue of a unicorn company, which is quite a big responsibility. I can imagine. 

14:57
Álvaro Castañeda
Also being working with the customer service department gives it the capability of centralizing every single talk that we have with a customer. So the proactive talk would be the CRM team. We are in charge of being your best friend, trying to advise you in the way through the platform. And then at the same time we have the customer service team that is going to be here to support you. Whenever the CRM team didn’t really explain you how to use something proactively, you will have the customer service team that is going to be there for you. So it’s like being in charge of CRM and customer service helps me to really understand the 360, the customer behavior. 

15:41
Max Koziolek
Interesting. Yeah. What do you see as a biggest challenge for you and your team? 

15:47
Álvaro Castañeda
As you know, it’s ecommerce marketing in general, it’s a fast changing environment. And if we talk about the last year with AI, it’s even faster the way we are changing. So in the future, where I see the main challenges, I would say it’s AI for sure. It’s something that we are going to need to adapt ourselves and use it as an additional tool. I don’t think we need to focus 100% on AI, but we need to use it as an enhancement, something that is going to give us the power to build better things, personalize better to be faster. But we cannot focus 100% on leaving everything to the AI. Otherwise everyone is going to be sounding the same. What’s something very important as well? For me, it’s data privacy. 

16:38
Álvaro Castañeda
We can see that in the last couple of years with GDPR here in Europe or even with Apple changing their policies and so on, data privacy is going to be very important in order to target customers. I think customers now are more aware about data and everyone wants to keep their data safe. So it’s very important to personalize the experience of the customer, but taking into account that we need to respect the privacy. And of course, something very important for me is to be relevant. You can personalize whatever you want, but you need to be relevant. Personalize the experience just by the sake of it. I don’t think it makes any sense. You need to personalize in order to make the customer journey easier or to really help the customer. Otherwise, personalizing just because of it doesn’t really add any value. 

17:35
Max Koziolek
Personalization or versus relevancy, how do you see the both? Because on the one hand, if you personalize a message more and more, it could become more relevant, but not necessarily. How do you ensure relevancy? 

17:52
Álvaro Castañeda
That’s a very good question. So for us, relevancy is the same as our mission. What we want is to help our customer to create great design faster. So every time that we launch a new product, or every time that we send a message, or every time that we prepare a campaign, what we think is this campaign or is this message helping our customers to create great design faster? If the answer is yes, then probably the message is going to be relevant because it’s really helping our customers to achieve their goal. If the answer is no, probably, then we need to think another strategy. But what’s our mission? For every single decision that we take, we always have that in mind. 

18:40
Max Koziolek
That makes a ton of sense. So you are first principle driven. So you have a first principle as a company or the mission statement, and then you tie it always back to that and saying, that’s basically a good test. I can totally imagine your team sitting around and asking the question, is this helping our customers to create better designs faster? 

19:02
Álvaro Castañeda
Something that every time that, for example, our product team is thinking about launching a new feature, our CPO, Martin, he always asks the same question, this is going to help our customers to create great design faster. And then based on the answer, we move on or we try another thing. 

19:21
Max Koziolek
Yeah, and you always have to drill a little deeper because the superficial answer might be yes, because XYZ. But often you can ask a follow up question, is it really right doing that? And then I think then often the answer becomes a little bit more, it becomes different, it’s changing or becomes nuances into that. If you think a little bit about the future, you already mentioned a little bit AI and the impact that it might have or will have on CRM. What else excites you about the future of retention and CRM marketing? 

19:54
Álvaro Castañeda
Well, a part of the AI for me also the different channels that we’re going to be able to use for marketing. Years ago, the only channels were email, sms, phone calls at some point, but now, or even for freepik, our main marketing channel, it’s our web itself. So the website is the place where our customers spend the time, and it’s the perfect communication channel for us. So for me, the way that we can personalize our website, so every single customer has a personalized experience. It’s the key for our future. Email, of course, is going to be always a good channel, but it’s a channel that every single company is using. Of course, we need to try to make a difference and to be relevant and stay on top of mind with our customers. 

20:48
Álvaro Castañeda
But the way that we are going to be able to personalize the web, so when the customers enter Freepik, everything is personalized for him and the experience is as fast as possible. This is going to be for us, the most important thing. Even when we talk about AI is something that is going to be very important in the way we are going to personalize the web, because it’s the tool that is going to help us to really go customer by customer, segment by segment. But I see that the future is going to be on that direction. 

21:25
Max Koziolek
100% agree. Because this podcast name is the one to one, right? And I agree. I think that’s probably the biggest shift we’re going to see. Also powered by either we move from segments to individual people, not just every segment. I don’t know, student in Malaga, they all have the same experience. It depends on who you are and you will have a slightly different experience and different needs, probably, which are catered to, which I think is very exciting for teams, but also probably a huge challenge to us. 

22:02
Álvaro Castañeda
I mean, we don’t work in a specific local market, so it’s very different. A customer that we have in Brazil, a customer that we have in the states, or a customer that we have in Malaga. So if we go segment by segment, it’s going to be impossible to personalize the experience for every single segment. So we really need to go by customer and use all the single tools that we have. AI, personalization, our own data, create the perfect mix so we can really go customer by. 

22:33
Max Koziolek
I mean, I think going by market is a very fair assumption to say. Probably people in Brazil have slightly or somehow similar patterns. But is it true anymore? Right. So we talked about this before. We have remote workers which are all over the world now, which have, might have. So maybe a lot of brazilian people are in the US or are in Malaga or vice versa and so on. So I think we going to see a lot of different interesting insights once we start to unpack the different segments, which you probably already do due to the prioritization of the different signals you have. But I think if you go one to one, then that becomes probably the most interesting part. 

23:17
Álvaro Castañeda
It’s the most difficult, but the most. 

23:20
Max Koziolek
I agree. You’re leading the CRM team, a customer service side at a unicorn. So what are your top three pieces of advice for other marketers? And who would probably are at the beginning of their career? Or what do you wish to know at the beginning of your career when you started? 

23:43
Álvaro Castañeda
Well, if I see myself twelve years ago, I was totally lost. I knew I liked marketing, but I didn’t know the way I wanted to start my career. So the piece of advice that I could give to anyone, it’s first something that I usually say, it’s start your own business. For example, you can start doing a blog or a podcast. Let’s say that’s something that is very easy to do now. Before it was impossible because we didn’t have that tool. But now everyone is able to create a blog or create a podcast. And once you create that, you can start by testing how to promote your podcast, or to promote your blog by trying SEO, or by getting a list of emails that you can start sending messages to. 

24:35
Álvaro Castañeda
So that’s something that usually I recommend to everyone to try to establish your own mini business. Let’s say with that you will understand how marketing works because you will have the 360 vision of how to acquire customers, how to retain them, and how to make them loyal in a very small scale. But once you start that, you will realize what’s your favorite part of marketing. Maybe you will understand that you love to see how to acquire customers, or maybe you will find the focus on retaining them. And once you realize where your preference is, then you have to go for it and start investing. A lot of time reading books. 

25:17
Álvaro Castañeda
For example, for me, a book that I usually follow for CRM, it’s a book from, I think it’s Romley Jones product led onboarding is the name of the book, and it’s a book that I usually recommend to everyone to stop reading. Because even though it’s focused onboarding gives you a very global view of how to retain customers and how to build a CRM strategy. And then once you decide if you want to focus on CRM, or if you want to focus on acquisition and so on, then you have to start from scratch. For me, I knew in Malaga twelve years ago it was impossible to find an online job for CRM. So I moved myself, I went to UK and I looked for the role that I wanted. Then I started from there. 

26:05
Álvaro Castañeda
But we are in a global society where if you want to focus on a specific job or a specific career, you are free to move wherever you want. That’s something that I usually always recommend. Don’t be in your house waiting the phone to ring. Just start moving, making calls, investigating, and then probably you will find the perfect job for you. 

26:29
Max Koziolek
That’s very good advice. I mean, I like that a lot because starting to your own business teaches you so much and it’s a big experience compared to when you go into a niche. You’re starting from general and then decide on which niche to go for. I like that approach a lot. We can also put the book into the shout outs to make sure more people are reading this because I hear that in the podcast all the time. If you get the onboarding wrong, no matter if it’s a software product, if it’s a physical product, I think Erin Bozang was also saying that she’s from I have a robot. So physical product you have in your house. If you don’t get the robot to run and clean your living room, they won’t come again and buy something else. Right? 

27:13
Max Koziolek
So it’s not only crucial for software, but also for hardware, for almost any kind of product. So that makes all sense from this. 

27:20
Álvaro Castañeda
Book, something that I liked quite a lot and mentioned. It’s the analogy between the game Super Mario and the flower, the Fireflower. So the Fireflower is something that itself doesn’t add any value, but when Super Mario hits the Fire Flower, he becomes the Super Mario. So we see the marketing or our product the same. The product itself doesn’t add any value. But when you mix our product and our marketing campaigns with our customer, at the end of the day, we are creating a better version of our customer because we are enhancing the customer with our product and with our marketing campaigns. So we always need to see marketing and what we are offering to our customers in a superpower mode. So at the end of the day, the goal is to create a better customer, not just to sell your product. 

28:13
Álvaro Castañeda
So you need a better version of the customer. With that, the retention is going to increase, for sure. 

28:18
Max Koziolek
Yeah, you change the identity. Very cool. Yeah, very cool. Thank you so much. Was fun to talk and I think people will learn a lot from all the insights that were in here, from tactical advice to how to do your career and how to grow a global business, which is already a unicorn. So thanks so much for taking the time. 

28:38
Álvaro Castañeda
It’s been a pleasure. Thank you very much.