10 Years ago on Jan 2014, The Economist wrote a very long piece about how we were living in a “Cambrian Moment”. Today we are living in a similar “Cambrian Moment” but in Retail Media and Commerce Media.
About 540 million years ago something amazing happened: lifeforms began to multiply, leading to what is known as the “Cambrian explosion”. Until then, sponges and other simple creatures had the planet largely to themselves but within a few million years the animal kingdom became much more varied. It was a moment in Earth’s biological history when diverse life forms emerged.
The Economist likened the growth of digital startups to this Cambrian explosion. In this new digital age, “cheap and ubiquitous building blocks for digital products and services have caused an explosion in startups” and that “digital startups are bubbling up in an astonishing variety of services and products, penetrating every nook and cranny of the economy. They are reshaping entire industries and even changing the very notion of the firm”.
They even quoted Marc Andreessen, the famed Silicon Valley venture capitalist: “Software is eating the world”.
The Economist talked about “software that is eating away at the structures established in the analogue age. They are using “application programming interfaces (APIs), digital plugs tha allow one service to use another, for instance maps (Google) and payments (PayPal). The most important are platforms that can host startups’ offerings (Amazon’s cloud computing), distribute them (Apple’s App Store) and market them (Facebook, Twitter).”
From a remove of ten years, we can see how prescient The Economist article was. Since 2014, software has ‘eaten the world’. Today, cloud services, open-source software and application programming interfaces (APIs) are ubiquitous and are seen as having democratised entrepreneurship, enabling new businesses to be built with minimal resources and time.
What it means for retail media
Retail Media is similarly eating away at earlier ‘structures’ such as Trade Marketing, Shopper Marketing, Google and Meta. The use of widely available tools and technologies that can be used as building blocks for new Retail Media capabilities is just starting.
The core retail media technology landscape has been dominated by Criteo and Citrus Ads (now Epsilon). However, there are a new generation of built-for-purpose RM technologies that are either seeking to replace these incumbents or to unbundle valuable component parts.
There are lots of great examples – and they don’t come from Silicon Valley – or even the USA. They come from Turkey, they come from Australia, they come from France, they come from the UK.
The challenges of Retail Media, whether it is measurement, creative, analytics mean that a whole slew of new technology is inevitable.
And investors are taking note.
The investor thesis on Retail Media
Mark Boidman, a partner in Solomon Partners investment bank, spoke at a Stratacache event called “What’s Instore for Retail Media Networks” at the NRF in January 2024. His talk was titled “The Multiplier Effect of In-Store Retail Media on Overall Enterprise Value”.
Boidman pointed out why Retail Media is interesting for investors:
- Retail media is one of the fastest-growing segments in the advertising market.
- Retail Media offers the ability to reach targeted audiences and accurately measure advertising effectiveness.
- This capability enhances the enterprise value of retail media companies.
- Retail media is gaining market share from traditional offline advertising channels.
- New retail media strategies present significant growth opportunities for networks that adapt effectively.
Retail Media is interesting for investors as it is a growth market with a large total addressable market (TAM), with lots of opportunities for new value to be created.
The recent news that Zitcha has secured A$15 million (US$10m) in Series A funding, led by VMG Partners includes support from OIF Ventures, is an example of this, to drive its expansion into the US market. The business has managed to get traction in multiple markets outside its home territory of Australia, with client wins in New Zealand, UK and Europe. The funding, which, will enable Zitcha to open new offices, hire key sales and customer success teams, and meet the increasing demand for advanced, data-driven advertising solutions.
The slew of announcements of acquisitions by advertising holdcos such as Publicis and Omnicom also support the Solomon Partners thesis.
The Retail Media “Primordial Soup”
Retail media is experiencing its own version of a Cambrian moment, driving a fundamental shift in how brands connect with consumers.
The last sentence of the original Economist article said “Today’s digital primordial soup contains the makings of the economy of tomorrow. “
Applied to Retail Media, today’s primordial soup of Retail Media 1.0 and 2.0 contains the seeds of startups to solve these problems.
As new technologies and startups rise to meet the challenges, they’re laying the groundwork for the future of retail and advertising. The innovations we see today will shape the next phase of this rapidly evolving industry.
Image: ellenm1 on Flickr (Creative commons licence)
You are in: Home » Retail Media » OPINION Retail media’s Cambrian moment
OPINION Retail media’s Cambrian moment
Colin Lewis
10 Years ago on Jan 2014, The Economist wrote a very long piece about how we were living in a “Cambrian Moment”. Today we are living in a similar “Cambrian Moment” but in Retail Media and Commerce Media.
About 540 million years ago something amazing happened: lifeforms began to multiply, leading to what is known as the “Cambrian explosion”. Until then, sponges and other simple creatures had the planet largely to themselves but within a few million years the animal kingdom became much more varied. It was a moment in Earth’s biological history when diverse life forms emerged.
The Economist likened the growth of digital startups to this Cambrian explosion. In this new digital age, “cheap and ubiquitous building blocks for digital products and services have caused an explosion in startups” and that “digital startups are bubbling up in an astonishing variety of services and products, penetrating every nook and cranny of the economy. They are reshaping entire industries and even changing the very notion of the firm”.
They even quoted Marc Andreessen, the famed Silicon Valley venture capitalist: “Software is eating the world”.
The Economist talked about “software that is eating away at the structures established in the analogue age. They are using “application programming interfaces (APIs), digital plugs tha allow one service to use another, for instance maps (Google) and payments (PayPal). The most important are platforms that can host startups’ offerings (Amazon’s cloud computing), distribute them (Apple’s App Store) and market them (Facebook, Twitter).”
From a remove of ten years, we can see how prescient The Economist article was. Since 2014, software has ‘eaten the world’. Today, cloud services, open-source software and application programming interfaces (APIs) are ubiquitous and are seen as having democratised entrepreneurship, enabling new businesses to be built with minimal resources and time.
What it means for retail media
Retail Media is similarly eating away at earlier ‘structures’ such as Trade Marketing, Shopper Marketing, Google and Meta. The use of widely available tools and technologies that can be used as building blocks for new Retail Media capabilities is just starting.
The core retail media technology landscape has been dominated by Criteo and Citrus Ads (now Epsilon). However, there are a new generation of built-for-purpose RM technologies that are either seeking to replace these incumbents or to unbundle valuable component parts.
There are lots of great examples – and they don’t come from Silicon Valley – or even the USA. They come from Turkey, they come from Australia, they come from France, they come from the UK.
The challenges of Retail Media, whether it is measurement, creative, analytics mean that a whole slew of new technology is inevitable.
And investors are taking note.
The investor thesis on Retail Media
Mark Boidman, a partner in Solomon Partners investment bank, spoke at a Stratacache event called “What’s Instore for Retail Media Networks” at the NRF in January 2024. His talk was titled “The Multiplier Effect of In-Store Retail Media on Overall Enterprise Value”.
Boidman pointed out why Retail Media is interesting for investors:
Retail Media is interesting for investors as it is a growth market with a large total addressable market (TAM), with lots of opportunities for new value to be created.
The recent news that Zitcha has secured A$15 million (US$10m) in Series A funding, led by VMG Partners includes support from OIF Ventures, is an example of this, to drive its expansion into the US market. The business has managed to get traction in multiple markets outside its home territory of Australia, with client wins in New Zealand, UK and Europe. The funding, which, will enable Zitcha to open new offices, hire key sales and customer success teams, and meet the increasing demand for advanced, data-driven advertising solutions.
The slew of announcements of acquisitions by advertising holdcos such as Publicis and Omnicom also support the Solomon Partners thesis.
The Retail Media “Primordial Soup”
Retail media is experiencing its own version of a Cambrian moment, driving a fundamental shift in how brands connect with consumers.
The last sentence of the original Economist article said “Today’s digital primordial soup contains the makings of the economy of tomorrow. “
Applied to Retail Media, today’s primordial soup of Retail Media 1.0 and 2.0 contains the seeds of startups to solve these problems.
As new technologies and startups rise to meet the challenges, they’re laying the groundwork for the future of retail and advertising. The innovations we see today will shape the next phase of this rapidly evolving industry.
Image: ellenm1 on Flickr (Creative commons licence)
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