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Unlocking Retail Media is the essential podcast for leaders and marketers navigating the rapidly evolving world of retail advertising. We move beyond day-to-day operations to explore the strategic future of the industry, covering major investment trends, the shift to hybrid marketplace models, and the existential disruption posed by Agentic Commerce. Host James Avery brings in top industry veterans and visionary founders to analyze how ground-breaking technology is transforming customer journeys, influencing product catalogs, and forcing retailers to rethink on-site, in-store, and digital media strategies to remain competitive in the modern age.
Dr. Mark Grether: [00:00:00] In the very near future, consumers will actually make the purchase on Google, on ChatGPT, on Perplexity, right? And that means fewer and fewer people will go to merchants websites and hence they will struggle now with friction frequency even further. So the question for them is now for the merchants, what do they do?
Right? And that's where, for example, our latest product innovation, what we call storefront ads, comes into play.
James Avery: What's it like to leverage the data of millions of consumers to build a really unique and brand new advertising platform? Our guest today has the answer. Dr. Mark Grether has a truly unique perspective on the world of commerce media.
He is leading PayPal's advertising business and building this really powerful advertising platform from the ground up, and it's powered by kind of this vast amount of transaction data that PayPal has with access to data from over 400 million consumers, 30 million merchants kind of [00:01:00] across the globe.
PayPal has what they call a transaction graph, and it's really kind of a unique and differentiated asset. In the world of commerce media. So in this conversation we're gonna dive into how PayPal is leveraging this unique position to work with some of the world's biggest brands. We're gonna talk about the challenges facing today's different retail media networks, and then we're gonna jump into the future of commerce in this AI driven world that we're all kind of entering.
So I hope you hope you enjoy the conversation. Well, welcome Mark. Thank you for joining us on the podcast.
Dr. Mark Grether: Thanks so much for having me, James.
James Avery: So I'm excited to chat. I feel like everybody's really excited and interested in kind of what you're working on at PayPal. And so, you know, I know you've probably done this a thousand times, but you know, what's the vision and what are you building over there?
Dr. Mark Grether: Sure. Happy to kind of talk a little more about, uh, PayPal ads. And let me start, why I joined PayPal Ads about a year ago, right? So I joined PayPal Ads and PayPal a year ago to basically build an advertising business from the ground up. Powered by this transaction data that we have here at the [00:02:00] PayPal. If you think about it, we have data from 400 million consumers globally.
Spanning about 30 million merchants also globally, right? So that's a tremendous amount of transaction data that we have our fingertips, and it's my pleasure not to use a transaction data or as you call it, a transaction graph, right, to power our kind of advertising business. If you think about a transaction graph, you think about.
30 million merchant, 400 million, um, consumers globally. That is really unique. That's really, truly differentiated. No one has access to the same amount of, uh, transaction data that we have. And, uh, yeah, Facebook has the social graph. TikTok has the interest graph and we have our transaction graph. So it's a really, really powerful asset to start develop business on top of it.
James Avery: Yeah, that's awesome. I think when we first talked about this, I think the, the possibilities here. You don't, there's not really another company that can do what you guys are doing. Right. Because even when you think about the credit card companies, it's [00:03:00] a much different level kind of transaction, right?
Like I might use a credit card at a store, they don't necessarily know what I'm purchasing, they don't know who I am, they don't know other websites I go to. It's kind of all the things that PayPal has access to. Right?
Dr. Mark Grether: Exactly. Exactly. And even if you think about the largest retailers in our industry, right?
Even they do not have as much data as we have. And even if they have a lot of data, right, they only have it on their own retail properties, right? They only know what's happening on their sites, right? Um, and so they can maybe go deep, but they can't go horizontally. Right. And many, many of our advertisers, many of our brands actually sell their products across many, many retailers.
And so they would like to know what happens actually across all these retailers, right? Who's buying where, when are they buying? What are they buying and what price points? And so from our perspective, the cool thing about PayPal is that we have this horizontal view that we're sitting across all of these kind of merchants.
And so we have a. Much more kind of holistic picture on how consumers purchase a product or brand [00:04:00] across all these kind of different touch points. And so I think it's a really, really cool differentiator that we are not just one single retailer, but we're sitting across all of them.
James Avery: Yeah, I think it's kind of a, it's a very unique position and I think this, this question gets asked a lot now, I think.
Uh, when you think about it, is this, is this retail media? Is this commerce media? Is this a financial media network? You know, kinda, I guess it doesn't matter at the end of the day, but I'm curious your thoughts on like, uh, you know, how we're naming all these things.
Dr. Mark Grether: Yeah, I mean, the, the first thing is I wondering why are we calling actually a retail advertising business and network?
Because it's typically not network, right? It's a single retail site. That is kind of mono. Yeah. It's a
James Avery: publisher like we, we call publishers and people are like, oh, we're not a publisher. But it's like, well, but in the ad tech days, that's what we call here, right? In,
Dr. Mark Grether: in the Ad tech days, they're a publisher, right?
And they're just one unique publisher, right? They're not really a network. Right. If one is a network, meaning, um, being basically the cons leader sitting across on. Of many publishers or many merchants [00:05:00] in a specific case, right? Then it's basically us, right? Because we are sitting really, truly across many, many merchants.
Now, whether you call retail or commerce, I would go and would rather use the word commerce in our case, because it's not just, uh, retailers, right? Where consumers can make purchases with PayPal of Mno. We have many, many more kind of verticals, uh, that are using PayPal to offer, uh, PayPal services to to consumers, right?
And so I maybe, I would think that. The term commerce media network in our case. Right. Might be the best one, but at the end it, it's semantics, I guess.
James Avery: Yeah. But it's an interesting observation, right? That this is actually a network.
Dr. Mark Grether: Yeah, exactly.
James Avery: And not just a single retailer. Exactly. Um,
Dr. Mark Grether: yeah, yeah.
James Avery: Yeah.
Dr. Mark Grether: I think that's a big, big difference.
And again, that's also the power of what we have. If you think about the retailers, the publishers, right, many of them are right now in the situation where they've built the businesses for maybe the last two or three years, right? And they're reaching to a point where they are basically sold out [00:06:00] on their own properties.
It's hard for them to go offsite because they do not have any data offsite. But at the same time, even though they might be sold out on site, the region frequency that they have. It's still challenging, right? It's for most advertisers, it's not attractive to run a campaign across 200 retail media, um, publishers, one by one, right?
And so coming to PayPal where we are truly in that network, they can actually run our campaigns across many, many retailers with one single campaign, and most importantly, also with measurement, insights and distribution across all of these merchants, right? We can go back to a brand and say, Hey, listen, on this merchant side, you're performing this way on this other merchant side, you're performing this way.
Right? And so we can then make recommendations how to best allocate advertising dollars across many, many merchants that are part of our network. And then again, with a transaction data, we can provide incrementality, we can [00:07:00] provide kind of close to attribution back to, to the brands.
James Avery: Yeah, that makes sense.
And I think, uh, it's one of the things when we think about offsite with retailers, a lot of times they, you know, they can sell offsite to a brand and they can tell you when that customer then converted on that retailer. But they can't tell you if they converted somewhere else.
Dr. Mark Grether: Correct. Right. Like did,
James Avery: did we run, you run this ad and say, oh, you know, we're running this ad for Walmart, but they actually bought it at Kroger.
Dr. Mark Grether: Yeah. You know? Yeah.
James Avery: Yeah. They don't know. But PayPal would actually know in that case.
Dr. Mark Grether: Exactly. We would know, because we have the payment data across so many merchants, and for most retailers, if we do run offsite, it's more kind of retargeting. That's what it's Right, right. Many of them wanna bring people back to their own website, so the transaction happens on their website.
James Avery: Yeah. Yeah. We just took, we took retargeting and we just renamed it to, to offsite retail media and now it's a new thing. Yeah.
Dr. Mark Grether: Now it's cool. Cool. Again, right? Yeah,
James Avery: definitely. Yeah. Um, so I think a lot of the people that you know, we work with are kinda, like you said, like they're, they're running the retail media network.[00:08:00]
They've kind of done the easy part, right? Like I think we always talk about, you know, you can launch something, you can get some amount of money pretty easily.
Dr. Mark Grether: Yeah.
James Avery: Right. And then, but then there's the next step. Right. And obviously at Uber, like you kind of, you did this whole run, right? Like you basically, you got it past that kind of the plateau that I feel like a lot of retail media networks Yeah.
Hit. And so I'm curious how you, like, what are the things when you look back and say like. What are the things people that are running the retail media network that are probably hitting that plateau, thinking about, okay, now how do we really grow to a, you know, very successful retail media network? What are the things that you'd, you'd tell to that GM sitting there?
Dr. Mark Grether: It's actually, it's a really, really tough question, right? And that's why I'm always recommending, before you even get started, ask a few questions ahead of time, which is the first one is what kind of data about audiences do you really have? And is the data actually truly differentiated? Right, you're really unique.
Or can brands get access to this audience data, someone else already? Right? Because many retail companies [00:09:00] do not have that differentiated kind of audience data. The second question for me to ask is, what is your region frequency? How often actually are consumers actually going to your retail website? And in many cases it may be 1, 2, 3 times a quarter.
Well, that's not enough to really build a big advertising business on top of that, but it's the reality that in many cases. That's the frequency that they encounter. Right? That's the second question. Um, then the third question is also an important one. Um, do you have actually access to advertisers or do you need to build a sales force?
Right? And if you do have access to advertisers, is it what we call the endemic advertisers, or do you have access to non endemics? Because only non-endemic advertis bring actually true kind of, uh, incremental advertising dollars to your platform. The fourth question is where you come, come in, James, what about the technology?
Right? How easily is it for them to implement a technology like Caval? And the fifth question for me is what's a cultural appetite to really build an advertising business? [00:10:00] And I'm pretty sure if people would go through this process and ask themselves all of these five questions, right? Some of them maybe would not be that kind of polish about billing it another retail business because we don't need three or 400.
Yeah. Right. Uh, but many of them didn't. Right. And as a consequence of that, uh, after, let's say the honeymoon of the first 12, 18 months, to your point, is struggled to then scale the business further. It's, it's different to building business on your, on onsite data, your on onsite purchase, uh, intent where you have high margins versus going into off offset as an example.
Right. It's a whole different ball game where offsite you have, um. Challenges about the margins, which are much lower, right? You have data fidelity, which is very different. You don't have purchase intended anymore. So Offite is a completely different ball game in getting after kind of that spend. So typically, for me to answer your specific question is most of them, they start [00:11:00] on site with endemic advertisers.
The second step for me would be, can you onsite leverage, uh, non-endemic advertisers to give you incremental advertising dollars? Yeah. And then the next question might be, let's consider offsite. But again, for many retailers, that would've a big question mark where that business is, is worth the effort and the hard work, it's needed to do so.
Right? And then, and then the consequence of that is, um, okay, where do I grow next? And I do think we will see conservation in our industry happening sooner than later. Where a few big players will consolidate, um, smaller players into, uh, a single buy because it's the most efficient way to monetize from a popular perspective.
And it's also the way of how advertisers actually would like to engage with the, let's say, mid to long tail of retailers.
James Avery: Yeah, I mean we always, like, I won't name names, but we always, you know, [00:12:00] there's, you know, small grocery retailer that it's kind of like, are they really gonna be able to get their share of the dollars and are the big CPGs gonna wanna buy directly from them versus going to somebody that says, Hey, we've rolled up the bottom.
Dr. Mark Grether: Exactly.
James Avery: 20, you know, grocery chains. Yeah.
Dr. Mark Grether: And we, again, we have seen it in our industry couple of times. Right. We saw that in display. Where the actual Aetna group started, it became consolidated, right? We remember how many DSPs were out there, how many SSPs were out there at some point, how many mobile DSPs were out there, right?
And so and so forth. It's basically just a natural elu evolution of our industry that in the beginning, many, many companies get started, and then over time the industry is maturing and it's part of that consolidation is happening, right? And again, from a people perspective, as we already have. The relationships to 30 million merchants as we already have technology integrations through these merchants and the transaction data, while at the same time we are neutral.
Right? We are not a retailer. Yeah. Yeah. I do think we are in a really, really well [00:13:00] positioned to help do this kind of consolidation in our industry going forward.
James Avery: Yeah, I've been thinking about this a lot lately 'cause we're starting to see programmatic sneak into retail media more and more.
Dr. Mark Grether: Yeah.
James Avery: And, and if we go to a world where it looks a lot more, more like pragmatic.
Dr. Mark Grether: Yeah.
James Avery: You know what a retailer I've been thinking about, what do retailers do not to get totally commoditized. Yeah. Right. Because you remember like the publishers, like some of them have done still continue to do very well, but a lot of 'em were just suddenly like, well, I set up pre-bid. Put 10 SSPs in here and just, I get a check and that's the check I'm gonna get, right?
Yep.
Dr. Mark Grether: Yep. And I would even argue that, um, this kind of trend is actually even accelerating with ai. Yeah. Yeah. Because what happens right now is, and we see that now, right now happening for publishers, which is more and more consumers, right? They no longer go to Google and then get linked out to a publisher.
They actually stay on Google websites. Right. And they get the answer on Google themselves, or they get the answer on chat g, PT, or perplexity. Right. But for them, for [00:14:00] consumers, it's no longer the need to go to a publisher to actually get the answer, the question that they have. And as a result of that, many publishers lose up to 30 40% of traffic that originally came from Google.
Yeah. Right. And what's happening is the same is going to happen from merchants as well. Because in the very near future, consumers will actually make the purchase on Google, on chat, GBT on perplexity. Right. And that means fewer and fewer people will go to merchants websites. Right. And hence they will struggle now with reaching frequency even further.
Yeah. And so the question for them is now for the merchants, what do they do? Right. And that's where, for example, our latest product innovation, what we call storefront ads, comes into play. Where we basically now taking a merchant storefront, putting it into an ad and run this ad on any publisher website.
The cool thing [00:15:00] about that is now that as a consumer, you can make a transaction within the ad format itself. Yeah, yeah, yeah. It's very easy, very seamless. From a publisher effective, it gives them access to now new forms of monetization. While at the same time, the consumer, as he transacts in the ad, he stays on a publisher website.
They're no longer leaving the website to finish the transaction, right? So publishers have, uh, more users staying on their properties. It's easy for consumers to transact in the ad itself. All powered by PayPal and trust that comes with PayPal. And from a merchant perspective, they have now new storefronts.
Right? That's why it's called storefront ads, um, in the open web. So we are basically now using the open web into, let's say open commerce. Yeah. And every touch point in the open web can become a storefront and can become an opportunity for a consumer to make transactions. And so I think that's really important for merchants because again, they need to find [00:16:00] creative ways.
Of getting more region frequency into the storefronts as that challenge by ai.
James Avery: Because then of course you can run ads in those. You can run ads. In ads. You're gonna run a promoted listing in a Exactly. That's the next step. Forefront in a Yeah, a hundred percent. Exactly.
Dr. Mark Grether: Exactly. Yeah. Exactly. But again, they need to do that because what's the alternative?
The alternative is not doing that. And then the consumers, not only do they not go to a merchant website anymore and make a transaction within the AI environment, but secondly also what happens is they lose the relationship to the consumer. Right, because if you make a transaction on a merchant website or in the store for an that US merchant still have the one-to-one relationship to the consumer, right?
If that transaction happens in AI environment, the AI provider owns the relationship to the consumer, it's no longer the merchant, right? So the merchants losing that kind of relationship. And that is again, very dangerous for merchants. So yet another reason why [00:17:00] they should leverage things like storefront ads and, uh, be creative in ways of how they can get in front of the consumers in the new world.
James Avery: Yeah, I've been thinking a lot about when, you know, 'cause Chatt, BT is launched kind of the, like shopping in Chatt bt and thinking about, okay, if you're a merchant and you know, now it's, you know, chat to BT is going and looking at your website, pulling products in, customers are buying them. How do ads fit into that?
Like at some point are we, are we literally serving promoted listings to ai? Yeah. Are you, are we targeting it? Right. Are we, are, you know, is, is open AI trying to capture that? Right. Because I'm sure they'll, they'll think about how do they run a promoted listing campaign in the chat? Uh, but at some point, like we're, we're actually just disturbing ads to, to.
Shopping agents.
Dr. Mark Grether: Yeah.
James Avery: Right.
Dr. Mark Grether: Yeah. But again, I think there are two steps, right? The first step is, as you mentioned, that um, it's really about that, uh, the listings that you will see in an AI environment I'm sure will also be sponsored listings, [00:18:00] right? Yeah. Which means they are kind of ranked by conversion likelihood, and then you offer merchant to pay extra to get boosted in the ranking.
Right? And whether you do that on a standard retail website or whether you did in AI environment. That's basically conceptually and technically, same thing. Same thing, same thing, right? The next question is what if then the consumers are no longer making the purchase decision, but the Asians make the purchase decision on behalf of, um, of consumers, right?
That will be an interesting new world of how spawn the listings need to evolve in this, in this new kind of, uh, new phase. And also I would say that in this new kind of phase, things like branding become even more important. Right. Because as a consumer you need to basically give some direction to the agent.
Yeah. Right. And quite likely you will give them some direction in the form of, Hey, here's a list of three brands, right, that you can pick from. And then the brands need to make sure that they are kind of in this consideration set. I do [00:19:00] think that it's almost kind of a renaissance of print marketing that I see in this AI world because that will become a key differentiator and a key kind of, um, input into the agents.
James Avery: Yeah, I think it's fascinating 'cause I think about how I would use this, right? It's like I have like a anchor power bank. Yeah. You know, that I take when I travel right. And it's like, you know, it dies. And so when I go to Chatt BT and just say, Hey, order me another anchor power bank from Amazon.
Dr. Mark Grether: Yeah.
James Avery: Right.
I've now told it a brand and a retailer.
Dr. Mark Grether: Exactly. Yeah.
James Avery: Yeah. Right. And, and so you're right. Like I think either, either you have to become that brand of that name or I've also thought that, you know. A savvy way that chat to BT or somebody could do this to say is almost more of an offer. It's something that comes back and says, Hey, you said buy Anchor from Amazon, but Best Buy will actually deliver it tomorrow and it's $3 cheaper.
Yeah. And they'd be like, sure. Yeah. And then so you almost say like, it's almost like an auction, like a realtime auction at this point. 'cause I'm declaring my intent like back to like price line or something like this. [00:20:00] Right. I'm like declaring my intent of what I want. Yeah. And. People could potentially bid on who wants to offer this anchor that I need by tomorrow.
Dr. Mark Grether: Exactly. And then again, we are in the form of sponsor listings, right? Yeah. Where we now basically put not only, we are not only ranking the ads, but we are also basically mixing and offers into the ranking. Yeah. Yeah. And, and the idea is that the offer is then kind of increasing the conversion rate. Yeah.
And if a, if a, if a retailer, you can either say, okay, I basically pay extra to get boosted in smaller listings with an ad. Or I take the money and put it into an offer, which means now the consumer gets the value. Yeah. And hope that this is a smarter way to get more transactions. Yeah,
James Avery: yeah, yeah. It's really fascinating.
We're entering a, we're entering a fascinating time, I think with it's, I guess it's always that guess, but also why from a, from a,
Dr. Mark Grether: from a paper perspective, we have a really strong office program. Exactly to your point, right, where we say, Hey, office is a great way for our merchants, right? To basically give the people the last nudge to actually [00:21:00] make the purchase, and it actually does work, right?
If you put an offer in front of a consumer at the right point in time, you see a much higher conversion rate. Yeah. Yeah. Obviously there's a cost to the offer. Yeah. And so you need to basically, uh, calculate the incremental rows of it, but actually does work.
James Avery: Yeah, no, absolutely. I think it works on me. I think every once in a while you're, you know, you've even looking at some shoes or something and then you just get that, you know, 10% off and yeah, you go buy 'em
Dr. Mark Grether: Maybe, maybe chance.
You should, you should. Honey again, remember honey, the brows Extens, yeah. That's part of, that's part of, uh, um, paper. Right? That's exactly what you get. Right. They look, uh, I know, I
James Avery: think I don't need that though. I don't need any more encouragement to buy things online.
Dr. Mark Grether: If you do, it would find the best offer for you in case you find or look for a power bank.
Yeah. It does work pretty well actually. Yeah.
James Avery: Awesome. One, one other thing I wanted to, uh, another thing I wanted to touch on, I think we've talked about this some in the past, is like where, you know, and I know you talk a lot to brands and [00:22:00] agencies. You know, I think we've talked some about like what do retailers need to think about and what are they working on?
But I think it's, it's also so important of like, you know, the people spending here, what do they care about? Like, and so what do you see changing kind of in how brands and agencies are approaching retail media in general? Like, what are they looking at from a measurement perspective or which retailers are they gravitating towards and spending with?
Dr. Mark Grether: I mean, two things that come to mind. The first one is to your point, right, compared to three years ago when I launched the other kind of business at that time, retail media networks, commerce media networks were kind of really early days, right? And so the agencies weren't ready yet to kind of lean into, but they are now.
Right now, it's really fascinating to see how much agencies actually leaning into not only retail media in general, but also PayPal specifically. And I think the reason is. To your point, because of measurement and traction, the transaction data that we have across all these merchants. So right now it's at the end.
It all comes down to [00:23:00] measurement. Now, when it comes down to measurement, two things come to my mind. The first one is that everyone talks about incrementality. Yeah. So the questions really how can I prove that this investment provide incremental new users? Incremental new orders, incremental increases in basket sizes.
Or whatever the KPI could be. However, the first question that actually the brands ask themselves, and that comes from the CFO, is how is my market share actually changing if I invest more advertising dollars? Yeah. And so the first question typically is the CFO looks into market share and the potential impact of advertising dollars into the growth of market share.
That's the first order question. Once the CFO has decided how much money the CMO is going to get to spend the marketing, the CMO then decides how to best allocate the spend across all the different options, which is when [00:24:00] incrementality comes into play. Yeah. Right. As we are now sitting across all the merchants, right?
Let's say you have a running shoe company and they are spending across many, many merchants, we can provide them data about market share. And how market share is changing over time and how much money makes a increase in their market share. So we can help them to answer the CFO question, right? Then we can also help them to answer the CO question, should they spend more money with retail number one or retail number two.
But again, I do think from measurement perspective, you need to basically be able to answer both questions. The market share question at a higher level, as well as the incrementality question on a more tactical level. Right. And right now most of the measurement is still focused on incrementality. Not so many conversations are right now anchored on the higher strategic question of a market share.
James Avery: Yeah, it makes sense. I mean, I feel like there's a lot of, a lot of people are still catching up on incrementality.
Dr. Mark Grether: Yeah.
James Avery: Right. Like a [00:25:00] lot of it is still just showing a ROAS number and not even, not even cover the incrementality part. But I agree with like the market share. Piece. Right. And just to clarify, it's kind of like if you're, you know, if you're Brooks versus on cloud.
Yeah. And you're saying, what is my percentage of sales at this running world or, or whatever Exactly. Kind of retailer. Yeah. Right. And knowing like what somebody coming in to buy men's running shoes, how many times am I winning that transaction?
Dr. Mark Grether: Exactly. And that's actually what investors really care about, right?
They will know if your products actually are winning versus your competitors. Are you increasing your market share? Right? That's what the Cee o is asked. Yeah, yeah, yeah. It's not asked the question, what is the incrementality? Performant
James Avery: was your ad campaign on Running World,
Dr. Mark Grether: right? No. The question is, Hey, show me that you actually have over the last quarter increased your market share step by step.
That's the question that that investor community would like to know, right? Yeah. And that's why, yeah, and I think that's another
James Avery: point going back to the kind of the, one of the unique positions that you guys have is being able to [00:26:00] do that. At a more holistic level. Right, exactly. Because like we've, we've looked at, you know, we're kind of building some of that at Vel to say, how do we do that for a retailer?
Dr. Mark Grether: Mm-hmm.
James Avery: But that's market share for an individual retailer. That's exactly, you know, what is your share at this retailer? Not what is your share of this market. Right. Or at least digital market. Right?
Dr. Mark Grether: Correct. Yeah, exactly. Yeah. Mm-hmm. Yeah. And when it comes to measurement, the other interesting thing of this that we have almost kind of went from.
Probabilistic measurement to istic measurement. And now back to probabilistic measurement, right? Yeah. The thing with identity, right? Remember when it was not about lookalike modeling, right? And it was No, no, no. We should all do kind of istic first party cookies, right? And now we, again, back into probabilistic and it looks like if, if AI has given us the permission to do probabilistic again, when it comes to measurement and audience targeting.
James Avery: Yeah. As long as it's powered by AI and machine learning, I think we can get away with it. Exactly. Then a real trust it. Yeah, exactly. [00:27:00]
Dr. Mark Grether: Yeah. Uh, but again, to your point, measurement, it's really a big, big theme right now. Big topic right now. And, uh, yeah, we have a good kind of advantage here. I mean, another thing for us, what, what we are spending a lot of time right now is as we have now launched, um, the advertising business first on PayPal and also on Ven.
Right. And then is actually something that's really in high demand from an advertiser perspective, because the venue audience, it's a high income audience, a social audience, right? And people who spend money, right? That's kind of the ideal audience that almost every advertiser wants to get in front of us, uh, from of them.
And so we see a lot of kind of demand right now, um, for the venue audits more than actually I had anticipated. I mean, I joined PayPal, so I'm really, really glad to see that. Uh, then we launched offsite. We spoke a lot about offsite sitting across all merchants. We spoke about the store format. Another big opportunity for us is now international rollout.
As I mentioned earlier, we are in so many markets, and so we rolled out the uk. We have now rolled out the advertising [00:28:00] business in Germany, right? And more to come. So also for, for brands, we are not just a US player, we are also a global player, which is, especially for global brands, also quite interesting, uh, kind of, uh, value proposition and also for agencies, right?
That they can do business with us in, in many, many regions. So it's also exciting from that perspective.
James Avery: Yeah. That's exciting. Uh, yeah, I mean I think people forget sometimes that, uh, we do a lot of work in Europe and the size of retail media is quickly growing in Europe. Yeah. Um, and it's still, you know, in some countries like Germany and UK are pretty on par with the US in some ways from a sophistication, but then there's lots of growth in these other countries like Spain and Italy that are kind of a little bit, I'd say behind, but catching up quickly.
Dr. Mark Grether: Yeah, exactly. And I mean, I was at a conference early this year in Germany, right. Everyone talks about commerce media. As we do in the US right? It's, it's thing everywhere right now. And again, it's great that we have a solution not only in the US but also in other markets as well. And that gives us a scale, right?
Um, from an audience perspective, but also from a [00:29:00] technology and data perspective that just makes it easier to grow, to speak, uh, this business relatively fast.
James Avery: Yeah. And I'd say even I think in Europe, this is kind of true for us as well, you guys, there's also a privacy advantage
Dr. Mark Grether: mm-hmm.
James Avery: Where a lot of, you know, there's a lot of, there's data solutions in the US that would never be allowed in the eu, but you know, PayPal has a direct relationship with their users.
Dr. Mark Grether: Exactly. And,
James Avery: and it's just a different, a different setup than, than somebody just trying to scrape credit card transactions. Like we have tons of here in the US
Dr. Mark Grether: Yeah. And we are very, very a trusted brand. Right.
James Avery: Yeah.
Dr. Mark Grether: That is also very important here. Yeah.
James Avery: Reminds me. Last question I had for you was, uh, we've talked a little bit about offsite.
Mm-hmm. And we have a lot of retailers thinking about offsite, and I tend to see them kind of take one of two strategies, which is, one is let's just upload all our data to LiveRamp Marketplace or something like that and just spread our data everywhere. Or they say, we're gonna own the ad sales, right?
Like, we're only gonna make our data available through campaigns that you're purchasing with us.
Dr. Mark Grether: Mm-hmm. [00:30:00]
James Avery: You know, I don't know that there's like a right or wrong solution, but I'm curious how you think about those two options when a retailer is thinking about which approach they're gonna take.
Dr. Mark Grether: I mean, for me there is actually, uh, uh, a right answer, which is the second one, right?
Yeah. From the i I fundamentally belief if you really want to kind of monetize your audience data, you need to actually combine that with media. That's the only way of how you actually can truly get the value for data that you actually deserve. I mean, there's a reason why you cannot go to an Amazon, to a Facebook, to a TikTok, to a Google or to a PayPal and just buy their data.
Right? Right. You can only get it in combination with running campaigns. Um, with them. And that's the same for PayPal because I do think that's on the only long term viable way. Uh, and also a consumer friendly way of how you can actually run an advertising business. Um, and there are the reasons why there are not so many kind of third party data sellers out there anymore.
Yeah, [00:31:00] so from media as well.
James Avery: I, I agree. I try not to, you know, when we talk to retailers, that's what we always position. Obviously it's, you have a little bit more of an investment, right? Building up that team to sell ads and, and there's kind of delayed gratification. But I think when you look at the, like you said, when you look at the top.
You know, retailers and media companies, nobody's out there just giving their data away. Even if you know, whatever they're getting paid for it, it's still probably giving it away compared to what they could make if they bundled it with media,
Dr. Mark Grether: of course, because in the moment you give it away, right?
There's no need anymore for the brands to buy your first party media,
James Avery: right?
Dr. Mark Grether: Because you can reach out the audiences on the open web for a much cheaper price point.
James Avery: And then you can just also do what we all know has been happening for a long time, which is just, you know, reco those, those users and have your own data set.
Dr. Mark Grether: Yeah. And so you, in the short term, you make maybe some extra bucks with selling data and the long term you're basically killing your own kind of one P media business. Yeah. Why would you do that?
James Avery: Totally makes sense.
Dr. Mark Grether: Yeah.
James Avery: Awesome. [00:32:00] Well, this has been great, mark. Thank you. Yeah, thank you so much for joining me.
I'm glad we can make this happen. Thanks, and, uh, thank you again. I'll see you soon.
Dr. Mark Grether: Yeah. Thanks so much for having me, James. It was a pleasure.
James Avery: Thanks for tuning in to Unlocking Retail Media. If you enjoyed this episode, don't forget to subscribe and share this show with your network. We'll be back soon with more insights to help you navigate the future of retail media.
See you next time.