Customerland
Customerland is a podcast about …. Customers. How to get more of them. How to keep them. What makes them tick. We talk to the experts, the technologies and occasionally, actual people – you know, customers – to find out what they’re all about.So if you’re a CX pro, a loyalty marketer, a brand owner, an agency planner … if you’re a CRM & personalization geek, if you’re a customer service / CSAT / NPS nerd – you finally have a home.
Customerland
How Composable CDPs Are Transforming Retail Media Networks
AI-powered decisioning is transforming how retail media networks operate, and Hightouch stands at the forefront of this revolution with a freshly announced $80 million funding round at a $1.2 billion valuation.
In this conversation with Ian Maier, Ad Tech and AI Lead at Hightouch, we explore how composable CDPs are dramatically reducing implementation timelines for retailers launching media networks. Unlike traditional CDPs that require months of data migration, Hightouch's solution sits atop existing data infrastructure, allowing enterprise retailers to activate their first-party data across channels in a matter of weeks rather than months.
Maier shares a compelling case study of wearable technology company Whoop, which replaced scheduled email blasts with AI-driven decisioning and saw a 10% incremental lift in cross-sells. Beyond performance improvements, their marketing team now spends less time on operational tasks and more on high-value creative work – a double benefit that showcases AI's true promise in marketing.
The retail media landscape faces significant fragmentation challenges with over 200 networks now operating. This proliferation creates difficult choices for advertisers who must decide where to invest their budgets. Maier explains that success for retail media networks increasingly depends on making the buying process frictionless while demonstrating true incrementality – proving their platforms drive sales that wouldn't have happened otherwise.
Looking ahead, Hightouch is developing solutions that allow retail media networks to create holdout groups across channels, enabling true incrementality testing that advertisers can access through intuitive dashboards. This capability addresses one of the industry's most pressing needs, as evidenced by Maier's observation that "9 out of 10 folks at NRF said the word incrementality at least once" during presentations.
For brands navigating the complex retail media ecosystem and retailers looking to maximize their media revenue, understanding these technological advancements isn't just advantageous – it's essential for staying competitive as the space continues its explosive growth.
Customerland is a podcast about Customers. How to get more of them. How to keep them. What makes them tick. We talk to the experts, the technologies and occasionally, actual people – you know, customers – to find out what they’re all about.
So if you’re a CX pro, a loyalty marketer, a brand owner, an agency planner … if you’re a CRM & personalization geek, if you’re a customer service / CSAT / NPS nerd – you finally have a home.
There will definitely be places where the retailer or the commerce company may have some deep partnerships that they continue to lean on, regardless of, let's say, the level of effort. But as they continue to expand out and try to bring on new advertisers, that's when it really starts to become a problem.
Speaker 2:Ian Meyer is ad tech and AI lead at Hightouch, which, as you'll find out here in a few minutes, is a very robust CDP application that's being deployed well, as Ian will tell us, in retail media pretty interestingly, as well as some other applications. But first let me just say thank you.
Speaker 1:I really appreciate, ian, your patience in coordinating schedules here, because it ain't been easy. Well, mike, thanks for having me Been looking forward to this conversation for a long time. I know I had a great conversation at NRF and have been eager to catch up.
Speaker 2:Yeah, there's so much that that um nrf kind of prompted and I know we we just couldn't get to it all so so this is going to be basically the all of that, wrapped into a giant enchilada type. You know, everything we could possibly mash into a conversation. We'll try and make sense of it in the edit, I guess is what I'm saying Sounds like a great launch.
Speaker 2:Interesting anyway. Well, you know, just to set context, can you tell us in your own words what Hightouch is all about, what you're here to do and then your role there?
Speaker 1:Yeah, absolutely so. Hightouch is a composable CDP and an AI decisioning platform, one of our newer products that we released. Hightouch as a composable CDP. Cdp basically means customer data platform. You think about a company like Segment, where our founders actually started their careers, our co-founders both two of them were early engineers at Segment and played in this customer data platform space where essentially, companies, retailers, can push all of their customer data whether those are purchase, events, information about the customers into this central source of truth and then use that to push that data out, push events to ad platforms to curate audiences and push those to their ESPs and paid media channels.
Speaker 1:What they realized very early on is that there were some fundamental problems with that concept. Although there is a lot of value, one of those fundamental problems is the time to value. To essentially take all of this customer data complex customer data that you have and feed it into one central place takes a lot of time, a lot of energy, a lot of technical resource to do. That often meant that enterprise companies were spending anywhere from six weeks to 24 weeks to actually implement this very expensive product and so on. That realization actually implement this very expensive product, and so on that realization essentially built this new CDP that simply sits on top of your existing data infrastructure, so usually that's a cloud data platform like a Databricks or a Snowflake or Google BigQuery, and what that means is you don't have to pipe all of this data in, because it already exists. It's already there, and so what we see is that customers can actually get all of the things that they need to run their internal marketing to what we'll talk about a little bit run their retail media network and get started sometimes in a matter of a few days, but major enterprises in a matter of a few weeks, and that sounds crazy.
Speaker 1:I usually have to preface that and say, really, this is true, right? Customers like Accor Hotel, for example, took a few weeks to stand this up globally across many multiple different countries and business units. The other, our newer product, is our AI decisioning platform, which we're really excited about. It's something that we're investing very deeply in, that we just raised the major round to do, which allows you to take all of that existing data that you have in the warehouse and layer on this intelligence layer, this decisioning layer that essentially uses AI agents and reinforcement learning to make decisions for you on what message to send on what channel at what time for these different customers to accomplish whatever that goal is you want to accomplish. So a marketer goes in. They say, hey, we really want to maximize post-purchase transactions. And the system is going to test and learn to find out exactly what the right series of messages is over time across these different channels to do.
Speaker 2:That series of messages is over time across these different channels to do that. I mean, I'm projecting here because I've not seen a demo on this. I've just seen the news, which we've got to get to in a minute because it's a big deal. But from a media planner's standpoint, this is a dream come true. It's never as easy as hit a button and go have coffee. Nobody expects it to be that, but on the other hand, to have real-time decisioning, making content and channel decisions is a pretty huge thing for media planning departments.
Speaker 1:I mean I would think any medium.
Speaker 2:It's just going to be like, hey, first of all, is this real, is this really true? Because if it is, it's a, it's a giant thing and would allow for you know, all kinds of, um, new deployments of personnel and, you know, repurposing of, you know into a higher kind of decision capacity, positions and things. So, um, that's wild, so random. Question number one is is AI decisioning in market yet or is that still in development?
Speaker 1:It is very much in market. We have major customers of ours already using it, and quite successfully. A good example of this would be a company called Whoop Actually, I'm wearing a Whoop band right now. I'm a four-year-long member, so a very loyal customer. And Whoop essentially they sell these fitness bands to monitor your fitness, your sleep, et cetera, on an annual subscription and as a member they also sell and want to upsell me on apparel. I can swap out bands, I can get a nice fancy one for when I'm wearing a suit and a more durable one for when I'm working out. And they have essentially replaced their typical process of sending out these calendared emails, so these bi-weekly or weekly email blasts promoting their apparel products. With AI decisioning and when we ran an actual holdout against this group, they generated a 10% incremental lift on those cross-sell.
Speaker 2:And probably a massive improvement in efficiency as well, I would assume.
Speaker 1:Exactly right, and so that's one of the things that they're really excited about is their lifecycle marketing team being able to shift their attention away from all of this operational stuff just to get an email up and running to the creative stuff, to really more deeply understanding the customer, to crafting better creative, to testing new variation, and so there's sort of a double whammy in terms of just effectiveness and the efficiency and the shift in mindset of the team.
Speaker 2:So at NRF, one of the 20 topics we kind of flew through was a partnership I'm just going to call it that Hightouch had really just announced, with Databricks, to produce a self-service audience management platform. Essentially, can you just let's get into the weeds just a little bit, um, can you just let's get into the weeds just a little bit? Um, talk about the. We try and sound intelligent here and I'm clearly not the um. This self-service audience management platform now layered on with AI decisioning what. What happened there when we layered on the AI decisioning? What? What improved?
Speaker 1:No, it's actually a great question. There are two ways you can think about this. One is within AI decisioning. There are often going to be times when you want to use AI decisioning to test and find the perfect one-to-one personalized variation of your content or of your offer. But you may also want to do that within the confines of a specific audience. So let's say you have an offer that should only be available in the state of Texas. You could use the audiences to say, hey, I want to narrow this down to that state of Texas.
Speaker 1:Let's say you're a specialty retailer, like a Pet Mart, and you have this really unique data around what pets the pet owner actually has and you want to create and execute these campaigns based on whether they own a dog, a cat, a horse, etc. Audiences are the way to create those guardrails to say, hey, these are the confines in which I want to actually execute these one-to-one personalized campaigns. Another analogy you can draw here is actually in advertising. Facebook and Google have the same sort of concept. Facebook and Google were sort of actually the early pioneers of AI decisioning and with them, what you can do is you can say again, I want to run this right time to show to that specific, unique person to maximize the chance that they engage, convert, whatever the outcome is that you're optimizing for Gotcha Okay.
Speaker 2:Thanks for the clarity there, because labels are plentiful in this space and often overlap.
Speaker 1:That's right, they do.
Speaker 2:So, if we can, I'd like to talk a little bit about your very fresh announcement completed an $80 million raise at a $1.2 billion valuation. It sounds like there's a lot of happy people over at Hightouch right now.
Speaker 1:A lot of happy people. It's a really good signal in the market that what we're doing with the composable TDP, especially what we're doing with AI decisioning, is resonating, that we have the traction there. We're seeing the world, for example the CDP world especially, shift almost entirely to say composable is the way of the future and then just adding in not only the excitement but really just the early proven out results on incremental revenue to may add decisioning, I think great proof points we are. You know we will be the first ones to say that this is just the beginning. You know the fundraising is exciting but there's a lot of work to do to take that fundraising and to invest in really smart ways where we can deliver a lot more value for our customers and ultimately grow the business.
Speaker 2:If you're able to and you may not be can you talk a little bit about the roadmap and what that $80 million might be going to over, say, in the near term?
Speaker 1:The majority of our investment is really going to be in continuing to build out a world-class R&D team to build this future of AI decisioning and so to increase capabilities, increase, expand to new channels where we can apply AI decisioning, as well as to improve on other features that we're seeing, like bringing insights really rich insights into back to customers so that we can tell them exactly what's working and what's not, so that they can bring their own creative minds back into that AI decision process, as well as building out, again, a world-class go-to-market team so we can get this out to the market and make it a success that we think it can and should be.
Speaker 2:There's no shortage of indicators out there in the retail media space. That space is just on fire. It is for very good, solid, legitimate reasons. I don't think anybody who analyzes it would say, oh, we're in a bubble, watch out, it's real of a well-run, well-executed retail media campaign are so tangible and direct that it's hard to deny. You know why wouldn't you invest here? And clearly a lot of companies are. What I think is really interesting, a couple of things about your announcement. One is it's a clear indication of continued support for the idea and the industry. But you also, the people in that round, are some significant people. You're talking about some of the top investors across any showed up on the on the list of investors there. So it's, I think, one. It's a. It's a confirmation of the value of the industry, but I think probably more than that. Just by looking at who's who, who put the money into this round, uh, it's a, it's a giant vote of confidence. Uh, in particular, you guys are clearly doing some stuff right.
Speaker 1:It is Big, big vote of confidence and you know we're just, we're honored to be partnering with those folks. You know we look to them for guidance, obviously as well, very excited for the future with them.
Speaker 2:That's a huge deal. We sort of touched on this a moment ago, but you know, if you were going to look out, say, the next six to nine months not so much in a roadmap way, but, you know, looking at where retail media is right now, looking at where you could see it going because of what Hightouch's vision is, what kinds of things would you point out to CPGs and to the owners of these networks to say, hey, look, there's an opportunity here you may not be aware of, or there's a hurdle coming down the road that you should pay attention to, because I have a feeling that high touch probably has the 30,000 foot view that most of us down here on street level just don't.
Speaker 1:Yeah, great question. As you said, retail media definitely is not a bubble. There's a lot of very compelling value there it does as it continues to grow in popularity and more retailers and more e-commerce companies start to launch their own media networks. It does create its own set of problems that need to be solved. A lot of that around fragmentation, a lot of that around.
Speaker 1:Essentially, I as a brand or I as an agency who wants to buy this retail media, have to now operate across a swell of different providers who may have different methods and different systems in terms of how they actually take your request and take your money and deploy it, deploy it, and so a few things that I see coming down the line. The first is retail media commerce. Media networks are quite a bit more focused on, and going to need to be more focused on, ensuring that they can deliver campaigns quickly with a low level of lift. Otherwise, it's going to be much harder for them to justify to a brand, to an agency, that they should spend the time and energy to use their audience versus an audience or placements that are much easier to access to them, that are easier to aggregate.
Speaker 2:Are you seeing that as a friction point in the market right now? Is that a factor, or is the space still kind of in that? You know we're in honeymoon, we'll take what we can get kind of a phase.
Speaker 1:I think it is a factor. There will definitely be places where the retailer or the commerce company may have some deep partnerships that they continue to lead on regardless of, let's say, the level of effort, partnerships that they continue to lead on regardless of, let's say, the level of effort. But as they continue to expand out and try to bring on new advertisers, that's when it really starts to become a problem and you really have to deal with this trade-off as well between you know how much can I deliver each customer, each campaign, custom audiences that promise much higher performance, that promise you know that help me unlock new use cases for the advertiser, versus just rely on this sort of preset doc that I've got, my 10 preset audiences that I just try and sell out.
Speaker 2:And retail media is exploding. I was going to say expanding, but that's not even adequate. It's exploding, it continues to at just astonishing rates, but with it comes its own complications and complexities and kind of unforeseen problematic nuances. You have a view to some of those, so let's talk through some of those and how CPGs and media networks might be able to handle them.
Speaker 1:Yeah. So the problem with an exploding market is typically that now you have a lot of options and, as an advertiser, there are a lot of different retail media networks, commerce media networks that I can and may get value from buying advertising from, but doing that is really hard. So let's say there are over 200 retail media networks in existence today. Imagine just trying to log in let's say, imagine they were all self-service and just even trying to log into 200 different ad platforms to execute your ad campaigns. No one can do that. Even agencies are going to be scrapped to be able to manage that for a single client, and so they're no one can do that. Even agencies are going to be scrapped to be able to manage that for a single client, and so they're definitely not going to do that. What they are going to do is be really discerning around what type and what value these media networks have to offer to select the right one. Some of them may already have deep partnerships, so a retailer and a CPG company may already have a tight partnership, and so that might be an obvious choice. But for everyone else it's going to be a question around what unique audiences can they offer me that no one else can, right, because I'm also competing with the Amazons of the world, the Walmarts of the world, the Googles and the Facebooks of the world who have these broad targeting audiences, the Googles and the Facebooks of the world who have these broad targeting audiences. So that's number one.
Speaker 1:Number two is are there ways that I can? You know how easy can the retail media network make the buying process? So how quickly can I either get on the phone with the sales team, place an order and they have that custom audience up for me, delivered across multiple channels, right, so that we're advertising the velocity to buy and to deploy campaigns? Then number three is because we're going to continue to make, we want to make really smart investments. How do I know that my investment in this retail media network is incremental? It's driving incremental revenue.
Speaker 1:If you were at NRF, there was an all-day session on retail media. They brought in different brands who buy retail media, different major retail media network owners, consultants, et cetera, and I would say 9 out of 10 of the folks there said the word incrementality at least once, if not about five times in their presentation. There said the wording for mentality at least once, if not about five times in their presentation, but pretty significant. What we don't see in the market as much is a real solution for that. So that's actually something that we're starting to think about and by the time this is out, we may be already talking about the solution that we have with all that problem.
Speaker 2:Can you tip your hat a little bit as to how that might work?
Speaker 1:Yeah, essentially, as a retail media network, you're often monetizing first-party audiences. There are a few variations. There's the on-site version, where you're more selling access to the traffic and the keywords that you can target. But offsite especially, and then specifically onsite, when you're targeting audiences, what we're able to do is allow you or the retailer to create a holdout group or multiple holdout groups across channels, to allow you to deploy an incrementality test so that you can enable all of your advertisers, when and if they want to, to measure the actual incremental lift of those on-site and off-site ads.
Speaker 1:Then what's really unique about what we do, being a composable CDP, is all of that data the holdout group, the treatment group, the results of that are brought into your data warehouse and why that's really important outside of the obvious, which is you own the measurement, is that retail media network and the reporting that you offer your customers is something you build. It's not necessarily a software you buy. So this allows you to whether it's take high touch to layer that on top or your favorite business intelligence tool to then create this visual layer that you can offer to customers business intelligence tool but then create this visual layer that you can offer to customers to say hey. Here's the place that you log in to see your campaign performance, your attribution, as well as the results of your incrementality test. You can log in once a day and see the updated results there.
Speaker 2:I want that. That's going to be a pretty phenomenal thing when it hits the market, because I don't know of anybody who's working out a solution like that. They may be out there, but I'm just not aware of them.
Speaker 1:Yeah, that's the hope, and we've even got some early customers starting to do this already, one of the largest food delivery apps in the world. Again, we very deeply have this type of measurement embedded internally, and so all of their campaigns are being run, thinking about incrementality, right, global holdouts, right All the really smart stuff to prove this to themselves internally. And now what they can do is take that same functionality and turn it out to their advertising partners to say, hey, we don't just prove this to ourselves, but we're going to prove this to you.
Speaker 2:Wow, really exciting. Yeah, would love to be in one of the demo groups when that becomes demoable Pretty fascinating stuff.
Speaker 2:Well, ian, this is, I think, again we did the same thing we did at EnterOff, which is just kind of nick, the tip of the iceberg on all of the important things that are happening in this space. But what I'm going to suggest is that again I mean a colossal wrangling of schedules again, but maybe in another six months to reconvene to see what's new with high touch, where you are on the roadmap, if any of these new deployments are actually in market yet, and and what they're doing. Because, just you know, we talked to a fair number of RMN technology providers. That doesn't mean we have a full handle on the market, but I'd say we have a decent view and it seems like high touches perspective is a broader one than most, which I think is going to mean bringing off a lot more long-term value to those relationships. So it's my prediction. You heard it here.
Speaker 1:I would love to do that. I'm excited to see how the market moves in the next six months and how we move with it. You know it's our I think, our deep belief that it helps to kind of get into the trenches with those customers to help them solve the very real problems like how to deploy a retail media network, instead of just taking that super high level view, because there are very real nuances to what is required to do this successfully. And it's going to inform our product roadmap, it's going to inform how we support our customers. So I appreciate that.
Speaker 2:Well, Ian Meyer thanks again. Just for the record, Ian is ad tech and AI lead at Hightouch and the next chapter in this conversation is going to be a fascinating one. So, Ian, thanks a million.
Speaker 1:Mike, it's been a pleasure.
