Latest / Retail Media Breakfast Club / PayPal Ads’ Big Retail Media Bet: Why Shoppable Ads Could Finally Work (And The Future of Commerce in an AI World)
Transcript
- Cannes June 23 - intro === [00:00:00] Kiri Masters: Well, hello and happy Monday [00:00:02] Checking in from the Crossette at Cannes, and my first discussion of the day was with Dr. Mark Grether, the head of PayPal Ads. We talked about something interesting, which [00:00:15] is There are so many announcements and news about retail media. It's a constant news cycle, and actually PayPal Ads is doing something different at Cannes, which is they are not announcing any [00:00:30] new features, product announcements, partnerships, which is the typical approach to Cannes to get people, uh, to your sessions and stay in the news cycle. [00:00:41] Instead, they are focused on [00:00:44] making sure that the [00:00:45] market really understands what the existing PayPal ads capabilities are [00:00:50] [00:00:51] Kiri Masters: Let's listen in to a few highlights from my conversation with Dr. Mark Grether [00:00:56] I think the biggest thing for us is with the fact that we have the data across [00:01:00] all the merchants. [00:01:00] Okay. Right? We really sit horizontally across all merchants, whereas any other retail media publisher, I wouldn't call them network because they're typically a publisher, they see only in isolation what happens [00:01:15] on their site, right? Okay. And so let's say you run a campaign with this kind of Seattle-based company, and you might run a CTV campaign. [00:01:23] Well, they can only measure if a transaction happens on their own website. Got it. Yeah. Right? Yeah. Whereas we can then show whether a transaction happens [00:01:30] on any merchant website- Oh ... and can bring it back to then, um, the exposure in, let's say, CTV. Yeah. Right? And having that kind of horizontal view across, across all merchants, um, is a much stronger value proposition [00:01:45] and really truly shows the actual ROAS that a campaign achieves. [00:01:49] Yeah. Right? Um, and so that's for example, an ex- uh, an um, yeah, an example of leveraging the transaction data Um, horizontally is, is a powerful [00:02:00] differentiator. But again, it takes time to kind of truly understand it- Yeah ... leveraging it and make the best out of it. Yeah, that's-- I mean, that's a huge pain point for advertisers is- Yes [00:02:11] will I run a campaign here? I can see the results of that campaign [00:02:15] from that merchant- Yeah ... but not beyond. my point is really about we don't need to kind of come up with the next new thing. Yeah. Yeah. Right? As an industry, we have already so much. Yeah. Let's just double down. I remember, a classic example. [00:02:29] You go to [00:02:30] in the, in the supermarket, and you see the 10 different versions of cornflakes. Mm-hmm. And as a consumer, you're overwhelmed and you're not buying anything. Yeah. Mm-hmm. Versus if there are only two flavors, you pick one of the two. Yeah. Yeah. Right? And we are a little bit in the, in the same [00:02:45] sit- scenario where we've so many things. [00:02:47] Yeah. Yeah. Whether it's now so many retail media- Right ... uh, networks out there, everyone is having 50 features, and then the buyers, agencies, and advertisers alike, they are overwhelmed. Totally. Yeah. [00:03:00] And they go back to what is easy. Let's buy Amazon. Yeah. Let's buy Walmart. Yeah. It's easy. It's easy, easy. Easy. [00:03:06] I understand them. Yeah. I'm not getting fired for it. I'm just easy peasy, right? Yeah. And so I think we as an org- as, as [00:03:15] kind of the, the challengers, we need to almost also ki- need to come together- Yeah ... and say, "Okay, what is our one-stop solution that is so easy and still has the scale to perform?" Yes.[00:03:30] [00:03:30] Right? And, and so for example, there's, as you might know, may know, in September there's, um, Showcase. Mm-hmm. The new, the new kind of- Showcase. Yeah ... the upfront accent and the upfront for, for the retail media industry. And I think that is a great opportunity for us to come together [00:03:45] and say, "Let's make it easy." [00:03:46] [00:03:48] Kiri Masters: Next, I was really curious about how PayPal Ads is approaching their shoppable ad units. And as I said to Dr. Mark Grether, there's been a long [00:04:00] history of unsuccessful shoppable ads products in the past And so my question was, what makes PayPal's shoppable ads different and once. I just want this is a rather, uh, experience. More likely to be adopted by both publishers and consumers. [00:04:15] Let's listen. [00:04:15] I think that two main things which are different, one of which is that, um, we have our own ID. Yeah. Right? We have, um, the PayPal identity, and the big difference with our ID is versus, let's say, a cookie solution is [00:04:30] we must know from a payments perspective that Joe actually is Joe and not his twin brother. [00:04:36] Okay, yeah. Right? Because we wanna make sure that the money that we get from s- Joe is actually from Joe- Yeah ... or the money that I'm sending to Joe actually goes to Joe- [00:04:45] Right ... and not to someone who's... looks and feels like Joe but is not actually Joe. Whereas in the ads world, if I'm using a cookie-based solution, it might be Joe, it might be someone else, who knows, right? [00:04:58] Yeah. Which obviously for Shoppable [00:05:00] ads doesn't work. Yeah. Right? For Shoppable ads, I must know that actually the person who is shopping is actually Joe. So identity is the key differentiator, number one. Number two is with, um, PayPal, we already have the payment rails. [00:05:15] Starting from we have his address, his bank address, his f- uh, postal address. [00:05:20] We have everything that we need to actually fulfill the order, right? And hence, in our case, um, we truly can make [00:05:30] this kind of process much more frictionless and at the same time making sure it is actually Joe. Um, we have all the fraud protection in the background, which we're leveraging from, from payments. [00:05:41] So from that perspective, we're basically leveraging [00:05:45] the strength of PayPal and now just applying it in a new environment, which is the creative itself, as opposed to a checkout. And that means now for our merchants that they can [00:06:00] basically increase the reach of their own storefront, which is why we call it storefront ads. [00:06:05] So the idea is that your storefront is no longer just your website, but wherever you're actually getting in front of a consumer, [00:06:15] you can turn that kind of interaction into a storefront. Yeah. Right? You get more reach, you get more frequency. Um, and, um, yeah, for example, we have campaigns or a, a company like Adorama, [00:06:30] right, where we are leveraging storefront ads. [00:06:33] Um, they have seen on the one hand, uh, very high ROAS, as I mentioned earlier, right? Something like between seven, eight. But what they also saw is a lot of kind of incremental new users, something like [00:06:45] 15% of, of the users who are actually new to them. So it's, it's a conversion kind of booster to them. It's a tool for them to acquire new users, which they otherwise wouldn't have get access to. [00:07:00] Miracle Ads is the only retail media solution designed for both one P and three P Marketplace brands. Why does that matter? Marketplace sellers demand a [00:07:15] seamless advertiser experience that still offers full funnel ad formats, and retailers need a flexible solution that allows you to scale your media business. [00:07:26] Kiri Masters: Learn more@miracle.com. That's [00:07:30] M-I-R-A-K l.com. [00:07:33] [00:07:34] example- Yeah ... it's not like I'm shown an ad for a random product that I've never seen before- No, okay ... and it's like buy now button. It's, it's more I've been looking at a DSLR camera- Yes [00:07:44] and [00:07:45] then there, you know, I've been-- I'm obviously considering that- Yeah ... based on some activities- Yeah ... and then an ad is shown to me. I'm like, "You know what? I'm, I'm gonna check out." Exactly, right. And as opposed to now going through 10 clicks, [00:08:00] right? Yeah. Where you, you click on the ad, you go to a landing page, you need to fill out your address, you need to look up your credit card and your, and everything, right? [00:08:09] All of that is basically collapsed into one or two clicks, right? Mm-hmm. And so the point [00:08:15] from getting exposed to an ad to actually making a purchase- Mm ... that whole kind of funnel, so to speak- Mm ... is getting collapsed into one or two steps, which then is increasing the conversion rate. And what's also interesting is why also not only the merchants like it, but also the [00:08:30] publishers is because in the old world, you see the Adorama ad, right? [00:08:37] Let's say, uh, on your newspaper. You click on it. Mm. You leave the newspaper. You go to [00:08:45] Adorama, eventually make the purchase. Adorama. But you will never come back to the newspaper. Yeah. You're gone, right? If, however, the transaction happens in the ad itself- Mm ... you stay on the newspaper website. [00:08:57] From a consumer perspective as well, what are some of the [00:09:00] barriers that have meant that shoppable ads haven't really worked so far in, in the past versus this kind of setup? I think the main differentiator is really the identity. [00:09:11] Okay. And the fact that, again, we already have the payment [00:09:15] rails, right? In the past, if it's cookie based, you still have to identify yourself. Okay. And you need to put in your credit card details and your address, and doing that in the creative is quite kind of cumbersome [00:09:30] And then what's the point? Then it's easier to just click on it and go to the landing page and go through the process on the landing page that you're used to. [00:09:38] Mm. Right? Which defeats the whole purpose. Yeah. Versus in our case, you can do everything in the creative.[00:09:45] [00:09:47] Do you have some, like, images of... Yeah. Yeah. Can you send those to me? Yeah. Okay, great. Yeah. All right, good. Yeah. And the other interesting thing, uh, I think maybe the other interesting thing is that the merchants, I would argue, have now more pressure. Yeah. What I mean by that is that a lot of the consumer behaviors now [00:10:00] start on LLMs. [00:10:01] Yeah. And eventually, the journey also ends on the LLMs. Mm-hmm. Right? Uh, which means the merchants see less and less traffic on their own websites. Yes. Which obviously is a [00:10:15] big worry to them, and so they need to think about, "Okay, if the consumers are no longer coming to me, how can I get in front of the consumers?" [00:10:22] Yeah. "And how can I, once I'm in front of the consumers, maximize the conversion rates?" And again, that's where a shoppable ad comes [00:10:30] in, so it's kind of almost an extension of their own storefront to kind of fight the fact that consumers might otherwise not come to them anymore. Mm-hmm. So meaning they have also some, some strategic kind of now almost pressure, right? [00:10:44] Yeah. [00:10:45] To, to kind of take it more seriously. [00:10:46] [00:10:48] Well, that's it for this discussion. I'm gonna keep checking in with you throughout the week from Cannes with tidbits of conversations, observations, and snippets of conversations like this one that you [00:11:00] heard today. [00:11:00] Thanks for listening, and I'll catch you soon [00:11:02]