Growing Ecommerce – The Retail Growth Podcast
Feed your growth mindset. Ecommerce is growing, and so are the challenges and opportunities for online retailers. In the Growing Ecommerce podcast, Mike Ryan and other smec experts are joined by industry leaders in ecommerce, digital marketing, and data science. By sharing business trends, practical solutions, and best practices, this podcast helps online retailers solve the challenges of tomorrow.
Growing Ecommerce – The Retail Growth Podcast
2025 State of PMax Report, plus: Zuckerberg shrugs ads, Amazon shares its ad stack
Digital ads in 2025 are anything but boring. In this episode, Mike and Chris unpack:
- Mark Zuckerberg’s eyebrow-raising claim that ads aren’t important (despite 98% of Meta’s revenue coming from ads)
- Amazon’s move to sell its ad tech to other retailers—friend or Trojan horse?
Plus details from our comprehensive new PMax research:
- How Google’s Performance Max is finally shedding its “black box” label, with fresh data from 500+ accounts
- Why your PMax campaigns need 30–60 conversions a month, no matter what Google says
- Why campaign segmentation should follow business logic, not default categories
Grab the State of PMax 2025 report—free on the blog or as a downloadable PDF:
https://shorturl.at/ali5A
Welcome to Growing E-Commerce. I am one of your hosts. Mike Ryan from Smarter E-Commerce.
Speaker 2:My name is Chris and it's an honor to be here. Episode two I learned right.
Speaker 1:Episode two yeah, that's right, let's see what do we agree? Episode 100, we're having a party on the yacht.
Speaker 2:Yes, we will do something crazy, Okay yeah yeah, I said the yacht already, so it's official benchmark is set.
Speaker 1:Yes, yeah, all right Life plans, get a yacht. So on today's episode, we're going to have a look at Mark Zuckerberg snubbing ads, Not taking tea. Yeah, believe it or not, let's talk about it. Yeah, we can talk about it, yeah save it, I'm going to run you through actually we'll run through together a report I authored called the State of PMAX 2025. And, wrapping it up, we'll talk about Amazon selling ad tech to RMNs retail media networks.
Speaker 2:Pack the chanda.
Speaker 1:Yeah, looking forward to it, let's go.
Speaker 2:What about the suck?
Speaker 1:Do you want to tell me what you saw? Eyewitness report. Tell me what you saw In your words.
Speaker 2:So first of all, I have a very special relationship with suck. Yeah, I saw a kind of cringy video. I mean there are many, many, many out there. I mean there are many, many, many out there.
Speaker 2:But there was one video that somehow stood out where he basically talked very, more or less down to the idea of running ads. So basically he said it's only a small part of the business and he's not really focusing on it. And I found it somehow weird because I double-checked the balance sheet. Okay, yeah, why did you find it weird? What did you find? Okay, yeah, why? So? Yeah, because I double checked the balance sheet. Okay, yeah, why did you find it weird? What did you find? Okay, yeah, why? So? Yeah, because I I mean, I can remember this, this one, this one one awesome interview or session he had in front of the American Senate Congress. I don't know.
Speaker 1:Never heard of him.
Speaker 2:Yeah, where he was asked is Amazon running Facebook running ads? And he said, senator, yes, we do ads. And so, without any hesitation, I picked up some balance sheets and I mean, I know ads was a big part of the business. But, man, fasten your seatbelt. Up to 98% of the revenue is generated through ads.
Speaker 2:And depending on the quarter, then Depending on the quarter, probably also depending on the year you look at, but calling, let's say, 90 plus percent revenue of your business, not an important part of a business? Yeah Is, I don't know man, I don't buy it at all.
Speaker 1:Yeah, it's a weird. It's a very weird take. I think he said something like yeah, I don't really spend a lot of time over there. Like it's some you know department in the corner, and I mean I saw brands online reacting to this video. It kind of went a little bit viral and they were saying like yeah, if you've ever used you know Ads Manager, it's clear that you're not spending a lot of time on it because the product doesn't work the way they want. Yes, it's very buggy.
Speaker 2:And the thing you mentioned now is, I mean, if and I think he's still a big part of a Facebook strategy, not just just deployment but also development if the mastermind, mark Zuckerberg, is not putting any energy into developing the ad business, like you said, what does that mean for me as an advertiser? Right, because the competition, I mean they are massively developing their ads business and the suck calls it I don't know basically an unimportant piece of their business. It doesn't make sense at all.
Speaker 1:I mean, I'm not a shareholder, but if I would invest in Meta, I would be pretty concerned hearing that.
Speaker 2:Yes, for sure. And the funny thing is what I also looked up. I mean, I looked at the stock development and Amazon had quite rough times, especially in days where the user growth basically stalled or stagnated. Their master move was that they really doubled down on their monetization strategy.
Speaker 2:Right, and this is when the stock rebounded massively and they're doing super well, rightfully so, because it's a highly profitable business. And to call that I don't know man, it doesn't make sense, and A I don't know man, it doesn't make sense, and A I don't believe him. I think I know why he's talking down on ads, because, as a super creative, 200 IQ guy, I don't want to waste my time with ads.
Speaker 1:Yeah, this is the thing, like just to digress and we move on. But like I just think that's a Silicon Valley attitude as well. I mean, the founders of Google were very dismissive of ads at the start and look, they're the biggest ad business that there is. And also, like Sam Altman recently had an interview where he was very dismissive of the idea of advertising. And I don't, I think he has. I I'm telling you, one day he's going to get a knock on his door in the middle of the night and someone's going to say Mr Nadella says, turn on the ads. And he's going to turn on the ads. He referred to it as some dimes. Like, yeah, we could make some dimes, but what is the better opportunity there? The subscription business?
Speaker 2:I'm just yeah, and the sneak preview. Next episode, I think we'll also talk about Google and maybe the fate of Google. Yeah, these businesses are based on a strong ad business and I know it's probably not the most creative one, but to call it what Suck did a small part, I don't know.
Speaker 1:It's not right on all levels yeah it enables like, yeah, we can talk about ads, but it enables the world that we live in. It is the driving force behind so many businesses. It made him a rich man. Yeah, and not only him.
Speaker 2:Not only him.
Speaker 1:Anyhow, so let's move on.
Speaker 2:Let's move on from the suck to something very special. May I do the intro to the next episode.
Speaker 1:You may. You have the honors.
Speaker 2:Yeah, because it really means something to me. So, ladies and gents, we, as Smart E-Commerce, we published a massive content piece, we call it the State of PMAX Report, and what I really want to do this is unscripted. I hope it's not too emotional for you, man. I'm not even sure if I'm in a position.
Speaker 1:I'm a cold reptile.
Speaker 2:I'm not emotional, I'm not even sure if I'm in a position to say that, but I'm really proud of you and the team who contributed to this report, because this is a hell of a thing. It's so deep, it's so objective and fun to read, so insightful. So thanks a lot for sharing this, and because of that, I would like to ask some questions about the state of POS.
Speaker 1:All right, all right, let's go. But I need to Kleenex first, because you made me you made me.
Speaker 2:No, I really mean it, I really mean it my first question, and I think you even referred to in your post on LinkedIn but man, how did you and the team come up with this content piece? How many campaigns you looked at, how many data points you analyzed? Give us some, because this is really deep shit what you delivered here.
Speaker 1:So this this is based on a sample of over 500 advertising accounts e-commerce advertising accounts. So this is an e-commerce report, which, of course, we're e-commerce people and that entails thousands of PMAX campaigns and that, in turn, entails like over 40 billion annualized impressions, and some of the data that we look at covers multiple years, so there can be trillions of impressions in there. And then, of course, all of the trickle down metrics from there that people care more about, like clicks and conversions and stuff like that.
Speaker 2:Massive, massive, and I mean, like you said, I read it in detail. If I may ask, what are the major, major things you would like to discuss during this podcast? There are many in there, but let's say the three to four major major findings.
Speaker 1:Yeah, let's see. I mean, how much time we have to get through, because I can get lost in these topics. I don't want to do that excessively, but I think it's very interesting to look at the features that Google is bringing out for PMAX and also, in kind of in parallel to that, what's happening with adoption of the technology. I think this is a very interesting area. There's other things we can talk about, like what are the kind of the characteristics of PMAX, for e-commerce is still largely shopping. We can talk about that. I think it's also very interesting to look at, like, the role of PMAX in an advertiser account, how it plays with other campaign types. Yeah, I mean, any of these things Can we, can we?
Speaker 2:can we? No, it's it's. It's quite interesting because, I mean, I'm I'm now in the business for 14 years and I lived through all this major development with regards to Google search, and I think we can agree on that. Smart shopping was the first real revolution, Probably one of the biggest ones, from standard shopping to smart shopping campaigns, and the funny thing is now, when PMAX launched in 2022, sometime in 2022. Everyone went wild. Right. This is black box. This is so much worse than smart shopping. Now, two years down the line at least that's what I got from the report as a matter of fact, PMAX is way, from an advertiser's perspective, way less black box-ish than smart shopping.
Speaker 1:Yeah, that's right. I mean, I find that people look at smart shopping with rose-tinted glasses and, just as a reminder, so Google had in the past they had automated pieces of campaign activity like, for example, automated bidding or smart bidding, also broad match. They were automating pieces, but with smart shopping it was their first piece of more or less end-to-end automated campaign tech where they took on a much bigger kind of challenge and they said let's do this whole thing. And PMAX was then the successor to that, where they took on even more, and now every platform. I think it's very relevant and important to talk about this technology because every platform is trying to create their own PMAX nowadays and this is like the future of this, of this kind of advertising, of digital ads.
Speaker 1:But yeah, like smart shopping was, it just had no features. It didn't have search term reports, so you couldn't understand what kind of ads were you were triggering. Excuse me, what kind of queries were triggering your ads. It didn't have just any kind of any kind of like placement reporting. It was missing all sorts of stuff. It was a complete black box. There were no controls, there were no negative keywords, anything like this. So there's nothing that you could really do to help control your traffic quality or shape your traffic strategy. You were just very much at the whim of the algorithm, yeah, and now with PMAX, it's taken some time, but there's not even like.
Speaker 1:They first rolled out something analogous to search term reporting that they called search term insights. But there's not even like they. They first rolled out something analogous to search term reporting that they called search term insights, but it was missing key things you need to make decisions, like cost data and stuff like that, and it wasn't compatible with other dimensions. But now they're actually. There's proper search term reporting and they rolled out negative keywords. At first. Yeah, there was a limit of like a hundred and people hated this, so they walked it back and there's like proper negative keywording now, placement reporting. I think they still have some work to do, but they've been improving that. They've been adding more exclusion possibilities, so you're really starting to see into PMAX more. There are things about it that are inherently a black box, like how the algorithm reaches decisions, stuff like that. But there was also a lot of intentional black boxing that didn't need to be, and so they're kind of opening it up more and also giving us ability to intervene and control more.
Speaker 2:Maybe also a question, because what I love about the report is that the report is also including the who is who of I would call.
Speaker 2:PPC experts who really know their game, and there are also some controversial statements in there. What I love, for instance, is I think there are a lot of people out there and it's reflected in the report, that, purely from a performance perspective, certain people state that there is basically no difference between standard shopping and performance max if you compare it shopping for shopping, and that it might make perfect sense to switch back to standard shopping or add it to your channel mix. I think you have a different point of view, but let's discuss this right there, because this I think there's a huge question every retailer has or is facing right now what is the right channel to to go into the future, mid and long?
Speaker 1:term. Yeah, I mean, I, certainly I. I've always said that standard shopping isn't broken. It's, it still works and I'm not going to say anything bad about shopping.
Speaker 1:I think it's a great technology and PMAX was certainly not built the way that I would build it, but they've made a huge amount.
Speaker 1:Like I used to think that they were just going to change this technology just in ways that were kind of token changes, but they had to be in Google's interest.
Speaker 1:But they're making really genuine concessions now and I think that the kind of feature parity between these two technologies has increased a lot. So, like you can still use like shopping is actually 90% of the costs in any given campaign like or in the median PMAX campaign. There's, of course, there's a range there, but if you look at, if you just pick a PMAX campaign out of a drawer, it probably is like 90% shopping costs and you can also exclude the assets and make it behave like shopping anyway. So I think at this point I actually have a little conspiracy theory maybe, but I think that Google is increasing the feature parity with shopping to such a degree that there's no reasons to hate PMAX anymore. Or there's, or there's, there's not so many, and I think they're. They in particular want to put big wallets at ease, and I actually think it's starting to pave the way for a sunset of shopping makes sense and yeah, that's.
Speaker 1:I'm not celebrating that, I have very mixed emotions about that, but but I think that there's that they're getting there.
Speaker 2:And another question from a purely technological perspective If you compare now that the shopping technology within PMAX versus the shopping technology of a standard shopping campaign, are we talking about same algorithmic models? And what is the reason for a retailer to rather go with with, let's say, standard shopping or pmx? If you really look at the shopping part because it's like you said, even with uh assets, asset backed uh pmx campaigns, the shopping share is up to 90, yeah. So what's what's your take on it from a technological perspective?
Speaker 1:I mean the core technology between both of these is shared and it's smart bidding, and Google has gotten very good at that. They've been working on that for years and years. It's a very mature technology and smart bidding works great for shopping and for PMAX and for PMAX. And the thing is we know like there were statements made by Google that they had rebuilt smart bidding for smart shopping back in the days, and I think we can assume that it is a slightly different technology that they have in PMAX, because it needs to look at more inventory and stuff like that. There's going to be more different signals. There's more it needs to think about and do. That's the thing.
Speaker 1:I don't think that smart bidding is so much inherently better for PMAX than it is for standard shopping, but at this point I think the reasons for hanging on to shopping are starting to get thinner. There are these edge cases and there are very specific scenarios where you might benefit from that and value it. But, like early on in 2000, back in the days when smart shopping rolled out, I took a big stand against it. And when PMAX rolled out, what I learned from smart shopping is that people used it anyway, with or without me, like it or not, and when PMAX rolled, rolled out, I wanted to help advertisers use it responsibly and use it better. And that's still very important, because you can use it good and use it bad, but you can also use shopping better or worse. But it's now at the point with pmax like I think we can now focus more on how can we really make the most of this campaign technology, rather than how can we fix it, because it's not really a mature product.
Speaker 2:I think we're in the same camp here. I mean, by the way, I also I mean I really always get a bit emotional when thinking or looking back at the good old standard shopping days where you could really control literally everything, good days, especially for the geeks out there. But as a matter of fact, you're absolutely right. Pmax is here to stay. I think the conspiracy theory that Google is at least thinking about sun setting smart shopping campaigns.
Speaker 2:I think that that's an obvious one, and if there is no real difference, also from a technological perspective, running standard shopping campaigns whether it's PMAX or standard shopping campaigns then I should, of course, go with the technology. Google is investing 100% of their focus on right, because even if the technology is the same between standard shopping and PMAX, google will make sure that every new feature of this algorithm is suiting pmx best, right I mean. So, I think, from a strategic perspective, no reason to hang on with standard shopping.
Speaker 1:Honestly yeah, I mean you. I, yeah, I agree, and I don't want the thing I.
Speaker 1:I don't want to sound like I'm a google salesperson here, but you're not I like we were just talking about this on the train ride and actually about totally different. We're talking about some political stuff. But I mean, I'm someone who looks at facts. I'm willing to change my mind, I'm willing to be persuaded, I'm willing to. You know and it just last month, I think it was there was a wall Street Journal article kind of blasting PMAX and yeah, it's still. It's perfectly right to still criticize it. It does need to improve. I'm not saying otherwise, but that article would have been relevant like three years ago.
Speaker 2:It was so outdated.
Speaker 1:It's like finally, the Wall Street Journal decided to talk about PMAX, but the opinion was so old school, it just wasn't up to date because the technology changed a lot.
Speaker 2:I think they have seen better days. But, by the way and you know this better than I do we have been giving a lot of shit to Google in terms of we challenged them on so many things. But, as you said, the facts are pretty clear. Now that PMAX is, especially if you compare it to the last big revolution, which was smart shopping, there's no reason to complain about it. It offers more. It's probably less of a black box than smart shopping, and the technology, if it's used the right way, does its job. That's right.
Speaker 1:The technology, if it's used the right way, does its job. That's right. If you look at advertisers, like their top 10 list of complaints, google has just been going down the line checking off those boxes, I mean you said.
Speaker 2:I can't remember when you said there will be a feature evolution for PMAX, but it will be on Google's terms. Now you basically took a step back and said well, actually the things they developed are right on the advertisers' terms, right, yeah.
Speaker 1:Yeah, and I mean yeah, maybe we just get into it, like if we talk about cost adoption, we've seen that it has kind of plateaued and there's even signs 80% something.
Speaker 1:Yeah, and that's declining a bit and it's even actually declined a meaningful increment over recent quarters. And it's hard to know if that's just a regional thing or like we don't have a perfect representative sample. We have a big sample but, based on what we are seeing, there has been a little bit of rolling back on PMAX adoption and so I don't know if that's part of it. I think there's many things going on here. I think that from the beginning on with PMAX, google was turning a page and showing a willingness to make some kind of concessions. But also you look at reports like some of these concessions came very fast and in a forced way. Like there were these bombshell reports about YouTube targeting children and search partner network, showing all kinds like there've been these, really these big bombshell reports when people dig into PMAX, and what I love about that is that you see how fast these changes happen. Like there are now YouTube placements, there's now search partner data in there, and they happen from the market.
Speaker 1:You know they didn't. This didn't come from a regulator, it didn't come from. Like. You know, maybe Google would have done it, maybe not. So I think there's some and sometimes their hand is being forced, but in the end, like some big spenders got super pissed off when they saw these reports, they slammed that report on the desk and slid it across the table and Google took action and I'm very grateful for that kind of stuff because it just helps. It just helps basically.
Speaker 2:I think Google follows the money.
Speaker 2:And the money basically follows the interest of the end user, which is you and me right. So I think this is the one thing why I think PMAX will evolve rather in the right than than wrong direction, I would assume. And one last thing, which which is which was quite astonishing, because I've been talking to probably more than 100 retailers the last 12 to 15 months about campaign structure, because it's the one big leverage you have optimizing, forcing pmex to do the right thing. And there are super interesting insights regarding granularity. How granular are you allowed to be in order not to I don't know kill the Google algorithm? Can you chime in on it? Yeah, for sure.
Speaker 1:Like. I've looked at this research for a while now and I shared some new data, like a very specific example in the report, because in aggregate, you see that campaigns there's a couple of things happening here. Campaigns need a certain amount of volume in them for the algorithm to work. Google more or less states that there is no minimum.
Speaker 2:Do we see that there is?
Speaker 1:Yeah, popularly, you'll hear that there's a minimum of like 15 to 30 conversions. Based on the data, I see a minimum of like 30 to 60 conversions. Google also says that the algorithm learns at the conversion action level, which means like purchases, which could be an action that exists across multiple campaigns and in theory, it should have a cross campaign learning effect. But I see no evidence that that's occurring. And so we know that having like it's not like the old school days that we were just waxing poetic about, where all the granularity you could do, all the control you do need to consolidate better. That's, that's in your interest. It's in the interest of your performance. On the other hand, we also see that advertisers are building more complex accounts. So the modal value, like the most common value, is still one PMAX campaign per account, which I don't recommend unless you really don't have the volume. It can be.
Speaker 1:You can reflect your strategy, but there's this balancing act between and in one case that I dive into in some detail in the report, there was an advertiser where we saw they had these very fine grained margin buckets and they tried to reflect this in their account structure. So they had a huge number of campaigns that were reflecting, like margin and category, and these ROAS targets that were assigned to them. Those were given from finance, they were handed down and the thing is that the data was way too fragmented. With this, you know, we're talking about 20 campaigns plus and you could see, you can just visibly see on the plot that I put there how the campaigns that have enough data are adhering to the target. Yes, they're accurate and they tend to maybe even slightly outperform it. And the campaigns that don't have enough data are all over the place. Some are high, some are low it varies on the month, and so I understand finance's wishes here, but they don't understand the campaign technology.
Speaker 2:For sure, and that's a high price you pay, right Exactly To have control. I don't know if it's in the sense of a retailer to sacrifice target ROAS adherence right. I mean, this is crazy. So I think this is the message to listeners out there who are exposed to PMAX this granularity thing is a big one, but limiting your campaigns to, let's say, under below 50 conversions a month, pmax will have a massive issue to adhere to your ROAS goal, which is really a real bad thing.
Speaker 1:Yeah, exactly, I mean it's tricky because I think that it's good to have some segmentation in there. But every segment that you build, it needs to have a reason for being, it needs to justify its existence, because it does come at some kind of a cost to trade off, and you just need to weigh those two factors one thing I would like to add here, talking about segmentation, and I think then we have to move to the last agenda point of today.
Speaker 2:What I still see and I don't know if it's it's, I think it's part of part of the part of the report, but what I still see is when I talk to even even huge advanced retailers, yeah that they fully understand that running with one pmx campaign is not not not not making it right.
Speaker 2:Then they start to think about okay, how can we set up our campaign structure? And they split it up to, let's's say, three to seven campaigns, maybe sometimes even more. But what a lot of retailers are not putting enough energy and thought into is on which criteria I want to segment my campaigns. Right so to segment your campaigns based on stupid data like category level two? What's the purpose? Right, so the segmentation has to be based on some criteria which is reflecting your business success or your business impact, right, I mean? And it's still a very, very common thing out there that campaigns are segmented on things which are not correlating with their business success.
Speaker 1:Yeah, I know. I mean, I think it's well-meaning and it was probably fostered a bit by Google in the early days because, in principle, pmax you know you have these campaigns and then there are these asset groups that are attached to them, and it has, it wants to have a theme. You know it wants to have this kind of thematic element to it, but these things are not mutually exclusive. You can segment by other criteria and still cover your thematic relevance, and so I think you know it can be a good first step to create category or brand segments. You might because of thematic reasons, because you might also have different margins between categories for different reasons, but it's really, it's a starting point and I mean I recorded a whole podcast.
Speaker 2:There's a podcast.
Speaker 1:Go, look and scroll through, type in like I don't know, type in product segmentation or something like that in the and you'll. You'll find the episode, cause I talked about like 45 minutes one time like a crazy person. You'll find the episode because I talked about it for like 45 minutes one time, like a crazy person sitting in a darkened room talking in a microphone. My and our philosophy is kind of that.
Speaker 1:You should view these campaigns as these empty vessels and these vessels like they, have a certain amount of budget attached to them and a certain goal, and this will change how aggressively or conservatively something in that vessel is promoted. And then products different products can end up in a different vessel for different reasons. One might be in an aggressive segment because it has high margin and you have overstock and it's behind sales plan or whatever. It totally makes sense. Another one might end up in there because it's new and you want to support that part of its product lifecycle or for really even multi-dimensional or multifaceted reasons, and PMax can handle that. Yes, absolutely so. There's so much more that people can do.
Speaker 2:No, we're not getting tired of talking about this multi-dimensional scoring or clustering approach, because we really believe in it, mike. Time flies.
Speaker 1:Yep.
Speaker 2:The report is out anyway. I hope you will download it yeah let me just you don't even need.
Speaker 1:Let me just say a word about it. If you just go to our blog, Smarter E-Commerce or blog, Google it, search it up or type SMEC blog or visit our website, whatever, and you'll see that it's there as an article, completely ungated. You don't have to send an email address or anything. There is a very shiny PDF, which it is a bit more concise. To me it's kind of a definitive version. I think you should check it out, but you got to give an email address for the PDF. Yeah, you know what? It's my platform. I'm going to plug what I want to, and today we're it's worth it.
Speaker 2:It's worth it. Yeah, yeah, all right, mike, and also to the team really shout out Thanks.
Speaker 1:Yeah, by the way, no man is an Island is certainly not me. A lot of people worked on it together with me.
Speaker 2:Absolutely so lost. The channel point, mike. Yes.
Speaker 1:Amazon is selling ad tech to retailers.
Speaker 2:Is it smart? Yeah, it depends on who you are. Look, I don't know. I'm always interested in the financials behind every decision and I can remember selling sheets and earnings reports of Amazon where they weren't even talking about ads it was somehow it wasn't broke, it wasn't broken out, it wasn't even broken out. Yeah, yeah but it's still, I don't know, crossed. I know five billion in revenue, but I know amazon, what is it? Six, almost 700 billion in revenue, yeah, 20.
Speaker 1:So yeah, it was I remember there was this mysterious like other segment or something and we could see that it was growing and people were like I think there's ads in there, there is something in there.
Speaker 2:By the way, back in the days, this would have been the right situation for Jeff Bezos to say.
Speaker 1:I don't know.
Speaker 2:It's not a really big part of our business, but it became huge. We're talking about $50 billion in revenue, right yeah, and this is roughly 10%, a bit less, a bit more.
Speaker 1:Yeah.
Speaker 2:So it's viable For sure. So for that reason I understand that move.
Speaker 1:Mm-hmm.
Speaker 2:But is there a but?
Speaker 1:For me. I mean, let's first just quickly define what we're talking about here. So when you go to Amazon and you search for anything, you're going to see sponsored results, and this is, of course, the Retail Media Network. I guess people know about this. But other retailers, they need a technology partner to do this. It's hard to do this on your own in-house and the landscape is incredibly fragmented. And so it's also as a brand like there's no standardization. And so it's also as a brand like there's no standardization.
Speaker 1:It's not so attractive for a brand to target a bunch of fragmented little like a lot of the money goes into the biggest ones and it's like that's the low hanging fruit. But some people have stepped into that void like Criteo and, to a certain extent, miracle. They're helping build up marketplaces. Criteo is good at the monetization side and the big giants all kind of slept on it. But and Amazon, on the other hand, in theory these are these other retail media networks are competitors to their retail media network, but they are offering their ad tech to help, so basically competing with Criteo. I would be pretty worried if I were curtail. Right now. They're offering that ad tech and technology is there right?
Speaker 2:yeah, exactly just about now making it available yeah, exactly I think, from from that perspective, it's, it's a smart move with you for amazon for sure.
Speaker 1:For Amazon, I think they're at the point. They're big enough. Now they can probably make more money. If they build the infrastructure for the competition, then okay, that's great. When the competition grows, they get a take of it. It's beautiful.
Speaker 2:So they will participate.
Speaker 1:Retail media is famously high margin for the retailer and Amazon is famous for saying your margin is my opportunity and this is a big part of it. Yeah, exactly.
Speaker 2:And this is those two things meeting. And this is why it makes perfect sense, because whatever competition might grow faster than Amazon if they're able to really deploy and adopt their technology into, I don't know, this fragmented marketplace landscape. It's a hell of a move. One thing and I think we have been discussing this briefly is if you're a retailer I mean, and Amazon I don't know how many retailers out there who are not seeing Amazon as their competitors Would you buy a technology of your core competitor? I think this is the one thing where there might be some pushback. And again, maybe Amazon is big enough and technology is good enough that this doesn't matter. But what is your take on that?
Speaker 1:I think that retailers are certainly going to do this with a heavy dose of skepticism, I would. I mean, if it's the best option out there, if there's no other way that you can make this work or like. I think it's certainly attractive because this standardization layer and stuff like this, it makes you more attractive to brands to advertise on you. I think you benefit from Amazon's network effects in that way, but you are introducing a competitor into a high profit revenue stream for you. And it's also like, if Amazon does well here sorry, chris if Amazon does well here, then it also decreases the lock in, like for brands. They can more readily switch around it. Also it's going to challenge, like I said, criteo or independent partners so that you might not be able to switch back to someone because that company might not be viable anymore. I'm just I don't know.
Speaker 2:And what about? I don't know if this is a conspiracy theory, but we love conspiracy theories on this podcast.
Speaker 1:We don't believe in it, but we love to discuss it. The thing about conspiracy theories is that some of them are true unfortunately.
Speaker 2:But wait, if Amazon deploys the technology, do they get additional data insights which might be useful for them? What's going on in another marketplace? Which products are selling, which products are not selling, what retailers and brands spend how much money on? I'm just asking is this a thing for Amazon?
Speaker 1:It's a very fair question. I don't know the architecture of this in that level of detail. I don't know. I hope not, but because this is what they've been doing, like this is what they've done to brands for years is, you know, they see what's selling and they make a knockoff. And also the whole thing is this open source marketplace. In a way, like everyone's the bestseller rank is, you can easily scrape it with an API and this is how so much cloning goes on.
Speaker 2:But I think we can agree on that. The technology is great, yeah, it I don't know adds up to more than 50 billion in the revenue. It's an intelligent move on Amazon's side, but there might be a bit of a pushback because of this competitive situation.
Speaker 1:Yeah, you have to look at the trade-offs, but I mean there's you know, it's not the first time For example, buy With Prime is rolled out on some retailers. And there was a retailer I shopped at. I needed this super specialized thing for my house and it was basically a B2B website. These guys were barely online. I tried to check out through their checkout and it wouldn't work and I needed this thing and I needed this thing and it was a huge problem for them because they're going to lose me as a customer. It was a huge problem for me because I couldn't find this thing anywhere else, actually. And then I noticed the buy with Prime button and I had never used it before and it saved the sale, it saved the conversion and I had clicked on a PLA, by the way, on a Google shopping ad, so it saved their ad.
Speaker 2:spend too, mike. That's a wrap. I would say yes, always a pleasure. Time flies, outro on your side.
Speaker 1:No outro on my side. Let's check out the State of PMax report. I worked hard on it. I think you'll like it. The whole team worked hard on it and, by the way, it's not a sales show. It's very balanced, for sure. It's very balanced. Yeah, and that's the final thought for me.
Speaker 2:That's it, mike, all right Till next time. Till next time.
Speaker 1:Growing e-commerce is brought to you by Smarter e-commerce, also known as SMEC. You can learn more by visiting smarter-ecommercecom. Thank you.