Discover more from The FirstPartyCapital Newsletter
The Retail Media Land Grab; DPOInsider, Essential Reading; Sustainability In Ad Tech; Google Ad Tech In Exit Lounge
This is the FirstPartyCapital weekly newsletter. It covers news and updates about the FirstPartyCapital fund and its portfolio companies.
Retail Media Land Grab, As Publicis Buys Irish-Based Retail Analytics Profitero For €200 Million
It was announced this week that Publicis Groupe is acquiring Irish-based Profitero for a reported €200 million. It’s a decent exit on the $45 million total raised over its lifetime.
Profitero is a platform that offers brands insights on sales activity and available inventory across 700+ online retail sites and marketplaces. In a fragmented ecommerce space, it aggregates data necessary to run a successful ecom operation.
Publicis is really going hard at building an ad stack for the new retail media channel. It already owns CitrusAds, a sponsored listing solution for retailers. Will they look to add the Profitero attribution layer to the media execution offering - enabling full-funnel attribution?
WPP is walking a similar outcomes-based path to Publicis with the launch of Everymile. Everymile is built heavily around its scandalously overlooked Cloud Commerce Group acquisition.
With CCG, WPP can now offer marketers proper logistical data at warehouse level. This means that ads bought across marketplaces and retailers can be properly attributed to actual product deliveries. It also means that buys can advertise against inventory availability.
FirstPartyCapital believes that retail media is less about mindless scatter-gun retargeting across “retail publishers” based on perceived signals - and more about accountable media buys (a media buy x will result in sale y).
It really is all about the funnel. And, yes, we are invested heavily in this area.
Read The DPOInsider For Proper Privacy Insights. SUBSCRIBE NOW!
Our portfolio company, Wult, has launched a new weekly newsletter entitled. DPOInsider. DPOInsider covers the biggest privacy stories of the week every Friday, offering an unrivalled summary of the hottest legislative and platform news.
DPOs and privacy professionals remain disgracefully underserved in terms of focused publications and newsletters. Remember readers, these are the people that keep businesses on the right side of privacy regulation.
They inform on policies and strategy around the use of the most critical asset in any company, namely user data. And they build the frameworks necessary to work in a privacy first era.
Media and marketing businesses simply cannot function without this key resource.
I suggest all privacy specialists - and readers of this newsletter - read DPOInsider. Privacy will never be as engaging anywhere else. SUBSCRIBE NOW.
Sustainability Should Be Top-Of-Mind In Programmatic
We have talked in this newsletter previously about the horrendous carbon footprint of digital advertising. The power required to serve data-driven ads is akin to the biggest pollutants on the planet.
ESG-conscious brands are now asking the industry to address this issue.
Programmatic advertising is in the spotlight. Our General Partner, Kevin Flood, talks about the technical specifics that will be required in programmatic media execution to reduce ad emissions:
If sellers are going to stop communicating IDs in the bid stream then increasingly, audience execution will be done in the publisher ad server… So there’s no need for impression-by-impression real-time buying. Then you pull the results every one-or-10 minutes, or every hour, update your pricing, targeting algorithm so it’s not done in real-time … [then] there’s no need for all of those server costs and that high-bandwidth or the environmental impact of that.
FirstPartyCapital is investing in startups building sustainable solutions. Both Cavai and GoodLoop are building versions of a “green tag”, helping brands meet carbon emission standards.
It’s great to see this as a headline issue. Clearly, it’s what has attracted the likes of BOK back to ad tech.
Don’t be surprised if you see an ESG-friendly AppNexus 2.0 built on some sort of blockchain in the coming months.
Google’s Ad Tech Business In The Exit Lounge - And We Don’t Care
There is a misconception that FirstPartyCapital “hates” Google. This is not the case at all. We are not haters; we are super fans.
Google is an immense money-making machine with brilliant engineers and some of the finest product brains in the industry. And it has executed brilliantly its two decade monopolistic power grab.
We have one core objection to Google: it's just too big to act as a “neutral” ad tech layer. How can it stay honest when it owns so much of the digital advertising ecosystem? Using its demand across search, display and video, it has kept potential competitors at arm’s length.
So, why has it taken this long to address the absolute power Google wields in the market?
Surely, legislators are aware of the 95% market share Google has in the ad server segment or how YouTube dominates CTV? Ad tech seems to have been a blind spot for politicians the world over.
Not any longer. Regulators are coming for Google’s ad tech business. Bloomberg is reporting this week that a bi-partisan “ad tech” bill could be introduced as soon as this week, banning any company making $20 billion+ in ad revenue from owning and operating third party ad tech.
Yes, reader, that means Google, Facebook and Amazon would all have to spin off their third party ad tech.
Let’s just repeat that again: Google could be forced to sell the entirety of the DoubleClick stack. If it does become law, this will undoubtedly change the dynamic of the ad tech market, leading to increased competition and badly needed innovation in areas Google has dominated.
Regardless of the regulatory outcome, FirstPartyCapital is happy to invest in companies taking on Google, such as Passendo in email ad serving.
We believe the ad tech and martech ecosystem is much bigger than Google, expanding into green fields areas untouched or dominated by the industry’s biggest monopoly.
We do not fear the big G. It’s just a fact of business life: a startup must learn how to co-exist and thrive alongside Google - or any mega walled garden.
Now if Google is forced to sell its ad tech business, then it's only upside for us. Either way, FirstPartyCapital wins.
Have a great weekend.