# S3 E10 T65 - Sallie _ Backpack Media - Marco Steinsieck

S3 E10 T65 - Sallie / Backpack Media - Marco Steinsieck 

[00:00:00]  

[00:00:00] Tom: You are listening to the Middlemen  

[00:00:09] Intro & Guest Overview 

[00:00:09] Tom Limongello: Hey Scott, how are you doing? 

[00:00:12] Scott Messer: Hi, Tom. I'm great. Thank you. 

[00:00:15] Tom Limongello: Today we're going to be talking to Marco Steinsieck. I butchered his name on the, uh, on our recording with him. But he has a storied career in, selling non-endemic retail media, selling retail media, in a world where. You're working for a retailer where the curation is really important. 

[00:00:35] Tom Limongello: He's worked with startups to try to build relevance in the ad serving world to try to deal with the fact that like ad tech stacks are usually really fragmented and varied and difficult to work with. I thought this was a really great conversation for somebody. Growing up in that retail media world. 

[00:00:51] Tom Limongello: Now he's going to the commerce media world 

[00:00:52] Scott Messer: . It was really fascinating to sort of one here is trajectory across sort of the beginning of retail media, uh, through [00:01:00] Staples to Sephora and now backpack Media, sort of that transition. Especially, as you mentioned, going from uh, selling things that are on your shelves to selling products that don't exist and you're going more offsite and using audience data to deliver more of experience. 

[00:01:16] Scott Messer: Marco's really smart, super sharp, and I think everyone's gonna enjoy the conversation. 

[00:01:20] Tom Limongello: Great. All right. Let's get to it. 

[00:01:23] Tom Limongello: Welcome to the Middlemen podcast. We are here with Marco Stein. Is that how we say your name? 

[00:01:29] Marco: Stan close. 

[00:01:32] Tom Limongello: Marco, you have a pretty awesome career path. You told me when we first met that you started at Vistaprint. You went to Staples, you went to Sephora, and now you're at Sallie / Back Pack Media. me through some of like. The early days, you talked to me about how you did non-endemic media at Vistaprint. 

[00:01:52] Tom Limongello: So tell us what that was about. 

[00:01:54] Non-Endemic Retail Media at Vistaprint 

[00:01:54] Marco: Yeah. So well, first of all, thank you guys so much for having me. Um, super pumped to be here with, with you, Tom and [00:02:00] Scott. If we go back to the early days at Vistaprint, my job was in the strategic partnerships group the business that we were building at the time. Was essentially non-endemic retail media, and we didn't have this language at the time, 'cause this was, I'm dating myself, but this is probably 15 years ago. Um, but Vista Print's whole business model was capturing intent and then upselling a free offer. The, the, the hook was 500 free business cards then you upsell 'em on different products and, uh, features and all that stuff. And so what, what we were doing in strategic partnerships was, you know, we understood who is this person that's coming in, they're probably a small business owner. are the other things that this person needs that we don't manufacture at Vistaprint? And how do we help them with these types of products? So whether it [00:03:00] was legal Zoom for incorporation or Pitney Bowes for mailing or square readers for. Um, my team would go out and source partnerships with these folks and then get offers into our, conversion flow, and then we would get paid a CPC or a bounty. And so, you know, this is non-endemic retail media. Um, and you know, as I said, we didn't have that language at the time, but, um, it was sort of prescient of, uh, what was to come. And it was a great place to start my career in e-commerce. Uh, very data oriented. A lot of ab testing and optimization, so it allowed us to really understand, you know, based on the data that we have on an individual user in, in their session, what's the right product for them and how do we optimize it? 

[00:03:51] Tom Limongello: Yeah, it's interesting and people, you know today, they're like, retail media is not ready for non-endemic. But, um, it's definitely been done if you're in the [00:04:00] right position. And speaking of being in the right position, I mentioned sort of the places you were at, but I didn't mention sort of exactly how you got there. 

[00:04:07] Tom Limongello: And that means that you were. think hook logic and triad. So you are like the OG of the OG of retail media. Um, how, how did that all happen? 

[00:04:16] From DraftKings to Staples Media Network 

[00:04:16] Marco: so, so I worked with Hook Logic and Triad when I was at Staples. 

[00:04:21] Tom Limongello: Okay. That's, that was. 

[00:04:21] Marco: that, that would be pretty, pretty awesome if I had worked at both of those companies, um, particularly when Hook Logic exited. But no, so when I, I, I went from Vistaprint to DraftKings. Um, the three guys that founded, uh, DraftKings I worked with at Vistaprint, and then I was. early employee during Series A there. And then from there I went to work for my old boss from Staples, uh, or from from Vistaprint at Staples where we were standing up Staples Media Network. And so our, this was 2015 and our onsite sponsored products partner technology and demand partner was Hook Logic. [00:05:00] and at that time it was a hundred percent network. There was really no private markets. was all, you know, demand that Hook Logic had sourced with their own agency relationships, um, who were then getting inventory across not just Staples, but all the other publishers in the Hook Logic Network. And so we were doing that. and then we had GAM for Display, which was sold by Triad. we had this very sort of fragmented onsite tech stack. Where you would, uh, you know, you could be talking to the same brand and they would be running a campaign via gam, sold by Triad Display. And then they would have a, you know, sponsored products, campaign through Hook Logic. And so, know, long, long story, long, hook Logic exited.  

[00:05:47] Unifying Ad Tech: Hook Logic, Triad & Crealytics 

[00:06:25] Marco: We ended up working with a company called Offer Logic to basically build what they had done for private markets and they then exited to Crealytics Crealytics also, when, when Triad shuttered, they sort of acquihire our GAM sales team. And so now we had the entire display and sponsored products business within one roof of Crealytics. And it was a, a great lesson in, in all the. Benefits that can be unlocked through synergy, right? We would sell it as a package. We could sort of, not completely freely, but generally move budget between display and sponsored products and then report it on a holistic level. 

[00:06:32] Marco: 'cause the brand, you know, the brand wants to know line item performance, but they really want to know, okay, we invested 200 K total with you guys. What was the total return? And, um, you know, we were able to get more sophisticated and, and de-duplicate and, um, provide, uh, multi-touch attribution. 

[00:06:50] Scott Messer: How much did that shift your business when, when you were able to make that sort of connection between the two ad servers? Like was that a, a, a big shift or just a Okay. 

[00:06:59] Marco: huge, [00:07:00] huge, huge shifts. Um, uh, operationally more efficient. So better for my team. Uh, the brands liked it better because now instead of having a sales call with this guy and then a sales call with that guy, and then a reporting call with two different people from two different companies and getting two different reports in different formats that may not have the same metrics, you're now getting a holistic, um, multichannel campaign with staples and we, we sort of in housed all of it. from 

[00:07:37] Scott Messer: Mm-hmm. 

[00:07:37] Marco: standpoint. So now instead of getting calls from Staples, you know, technology partners, you're getting one conversation that handles intake and understanding what your goals are and then, um, managing the campaign for you and optimizing it with you, and then providing you with performance reporting at the end. 

[00:07:56] Marco: So it was, um, just a better model, not only [00:08:00] for Staples, but also for the brand. And, you know, importantly. It allowed, it, it sort of was the stepping stone for what we would do with offsite. but the real, you know, the real winner here is the customer now you've got different moments in their journey that are coordinated of having it completely disconnected. 

[00:08:21] Marco: Because in the old world, you might get budget for HP via hook logic, via HP's agency for offer a. And then budget for HP directly for GAM with a different offer. And this is just not as good marketing. So it was better for everybody and it was better for the customer too. 

[00:08:45] Scott Messer: Thank you. 

[00:08:46] Tom Limongello: Yeah, I mean that I, you know, you're talking about as if it's ancient history. There's still a lot of that going around where there's not a completely, uh, you know, coordinated retail media tech stack. And so , the next phase for you, [00:09:00] somehow you got to Sephora and you ran the retail media network there. 

[00:09:03] Tom Limongello: What was the path to get to Sephora? 

[00:09:06] Building Sephora's Retail Media Network 

[00:09:06] Marco: Um, so Sephora, like many retailers, specifically specialty retailers at the time. Uh, was seeing all of the buzz around retail media and, you know, Walmart started putting ads revenue in their, in their earnings. Um, and so the CEO of, uh, Sephora, John Andre Rigaud, uh, this was like sort of the pet project of his. 

[00:09:32] Marco: And, um, we just started a conversation and I went over there as the first dedicated retail media employee. Uh, that was 2022 and when I left there, were pro, I don't, I don't know how many, but, um, you know, our agency probably 30, 40 people. So it was an incredible experience. One of the things that we talked about in prep was how building, you know, the things that I [00:10:00] did at Staples informed a lot of what we did and a lot of the strategy at Sephora, but. have to understand the company and what's unique about the company. And Sephora is, is so different. Obviously it's beauty versus office products, but, um, the margin structure of the business is also completely different. So, you know, at at Staples you might be running a 5%, 10%, margin if you're, if you're lucky. Uh, a product margin standpoint, Sephora is like 40, 50% in beauty. So it's just. The unit economics is totally different. And so the media business and the way it sort of plugs in financially is different. Um, the other big difference is that Sephora, and that, you know, this was somewhat consistent in Staples, but Sephora's soul is that it's a curator. Finds small brands before they blow. Signs them to exclusive deals, nurtures, nurtures them, helps 'em grow, and then they become differentiators. the media business that we were designing had to [00:11:00] reflect that. It could not be really in contrast with that. We were not trying to stand up like a, know, whoever has the deepest pockets, gets the most placement type of business. It needed to be consistent with. The beating heart of the company, which was, which was curation and merchandising. so that showed up in a bunch of different ways. Uh, but, you know, it was an important lesson, 

[00:11:23] Tom Limongello: Well. 

[00:11:24] Marco: which, you know, was consistent with staples, which is that you, the, the ads business that you build has to be aligned with the sort of mission of the company. 

[00:11:34] Tom Limongello: just so we understand, when you got into Sephora, did you have that nice setup where you had both and offsite, uh, built into the same tech platform, or was it two, two different systems again. 

[00:11:48] Marco: So, um, well, it's always gonna be different platforms. I think the, the service layer is where it became consistent. So there was a preexisting co-op [00:12:00] business at Sephora, which was not. Referred to as retail media. And when I joined and I understood a little bit more about what this business was, um, and started to see what it could become, you know, like it, it, it became clear to the extent that these offsite campaigns can be, not co-op, but fully brand funded. 

[00:12:22] Marco: You have a retail media business already. we then incorporated that with the onsite business. So we initially at Sephora, we were a promote IQ shop and that. That was a decision that was made before I joined, sponsored products and display were integrated, which was great. And then on the offsite side, it matured into a business where, you know, Sephora worked with all the major players across social display, CTV and audio, one managed service layer where, you know, we would put together a full package. That, you know, was pitched to the [00:13:00] brand. then we would activate across that entire package and report against all the different channels. So depending on your package, you might be 50% onsite, 50% offsite, or the mix might be different, or you might be mostly TikTok or you might be mostly meta. Um, and so that allowed us to sort of productize these different channel mixes and then activate them in a simpler way. 

[00:13:23] Tom Limongello: But were you able to get beyond the 1%, investment that we were always trying to do in Grocery ? 

[00:13:28] Sephora: Profitability, Offsite & Curation 

[00:13:28]  

[00:13:28] Marco: We were, we were able to do that. We al we always had our, our site set a bit higher. We got to, you know, 2% plus on a $9 billion business. So, that was really important for us. The more important number was the profitability of the business. And how it sort of fit into the e-commerce P&L. 

[00:13:48] Marco: So, you know, think what drew our CEO and, and you know, many, for many of these, it's the CEO or the CFO that learns about the impact that the ads [00:14:00] business can have just 'cause of the margin profile of the business. then, you know, sees it in context of downward margin pressure from supply chain and delivery. particularly during COVID, right? So that was a, a big thing for Sephora. and then sees how the, you know, maybe this ad business could counterbalance that, and that's what we were able to do. So we ended up, getting to a place where we were a meaningful driver of e-comm profitability. Over 10% of total profitability was coming from ads. 

[00:14:30] Marco: It's probably more now. I've only been gone for six months. And we were also able to reinvest that. Profitability into traffic driving, uh, and branding activities like top of funnel. So Sephora does a ton of really cool, innovative, iconic top of funnel marketing. and, you know, the margin from ads, know, in some ways was a direct line into that, that top of funnel 

[00:14:54] Scott Messer: Hmm. 

[00:14:55] Tom Limongello: And so you moved through that business, it got really big, you [00:15:00] know, 2% on 9 billion is a lot. Um, then what happened? Uh, you just got excited about Commerce  

[00:15:09] Joining Sallie Mae & Backpack Media 

[00:15:09] Tom Limongello: Media. 

[00:15:11] Marco: So I was at Sephora for, for four years. Um, you know, loved that business, loved that company. A, an amazing team that, that is there. Um, I got really excited by this opportunity at Sallie. Sallie Mae and Backpack Media. Is, you know, I think Commerce Media is emerging as a true compliment to retail media and there's some really exciting things happening on the commerce media side. 

[00:15:35] Marco: So, at both Staples and Sephora, you know, one of the things that I learned was. The media business, the strength of the media business is really about how unique and differentiated your customer relationships are. Sallie Mae has an incredibly unique and differentiated set of customer relationships. 

[00:15:56] Marco: Um, we have this unique combination of education and [00:16:00] financial signals that allows us to predict the future trajectory of young adults in a way that, that really nobody else can. Um, and so, you know, was that. There was also the, the opportunity to be a first mover in the education space. There's so many networks out there. 

[00:16:17] Marco: I mean, you guys have talked to a ton of 'em and there's, it seems like there's a new one every month. Um, to be a first mover in a category pretty rare and was super exciting. Uh, and then beyond that, just the team, the Sallie Mae team, um, was really, leadership was incredibly inspiring. Uh, the vision that leadership has for not only backpack media, but for the, the, the, the bank more broadly. Um, you know, really, really got me excited. So, um, there were, there were a number of different reasons.  

[00:16:51] Scott Messer: And so Sallie Mae's like a big advertiser on its own. Um, did they have sort of a, a marketing and ads business [00:17:00] before this iteration of it? And is, is this an extension and evolution of something or is this sort of a new idea coming out of, uh, the trend? 

[00:17:08] Marco: Yeah. So, um, I'd say it's a little bit of both. As you said, there's a lot of, you know, there's a good amount of marketing coming outta Sallie to begin with. Um, and Backpack Media operates within that Sallie ecosystem, which also includes private student loans through Sallie Mae. Uh, but it's also a unique standalone. Product and business line. So Backpack Media is the first education powered media network in commerce media. what we're building is predictive commerce media powered by verified life stage data. So in contrast to, to some other players and, and particularly in retail we're not looking at, you know, your past purchases. And that's what most media networks will tell you, what somebody bought [00:18:00] yesterday. What we're focused on is what the person is gonna need next. Um, and so, you know, for brands, really what you're looking for is a reliable predictor, a future transaction, you know, which from a retailer perspective is past purchases, but for us it's life transition. 

[00:18:17] Marco: So where you are in that life cycle, um, what we're finding is that is a more reliable predictor. Of future transactions than your past purchases. 

[00:18:28] Tom Limongello: so I think even the grocery retailers, like we had Bobby Watts on from ahold and he was basically like, we've gotta learn predictive audiences. We can't be relying on past purchases because new products are coming in faster than ever before. 

[00:18:42] Tom Limongello: So I think that that resonates pretty well. Um, but you know, when you have this different set of data, it's interesting to hear sort of how you would do it, because I think with the transaction is very easy. It's like, okay, you're a brand buyer, you're, you're a category buyer, you can sort of. Create this sort of, you know, sort of concentric circles to see the [00:19:00] relevance. 

[00:19:00] Tom Limongello: How do you do this when it's, you know, financial life stage. 

[00:19:05] Marco: yeah. So we have, um, you know, we have some very unique. insights and that's really our product, is our audience and our insights. So we see real life transitions. It's not just behavior, it's not past transactions. We have deterministic life stage signals, and, and those are pretty unique to us. 

[00:19:24] Marco: We have market share in the PSL space and we reach two thirds of college bound freshmen every year through our Sallie ecosystem. So like planning for college. Enrolling in college, graduating, moving into your first apartment, getting your first job, making your first financial decisions. These are very high intent windows in a consumer's life, and they're very consequential for, for brand loyalty, right? 

[00:19:53] Marco: So if, if you're a young adult making a first time purchase across, whether it's, you know, [00:20:00] furniture or car insurance or credit card. Um, those are very impactful moments for brand loyalty and, and what we say is, you know, get in early and win long. And that's really the value of, of what we have, these insights of that we have is this is a specific moment in time. through our unique and proprietary deterministic audience and insights, we can get brands in front of people at this moment. 

[00:20:27] Predictive Commerce Media & Audience Data 

[00:20:27] Scott Messer: Let's talk a little bit about the data stack that powers it and sort of how are you collecting that consumer data and how are you storing it just from a, a light technical level? I. 

[00:20:37] Marco: How are we collecting it and storing it? 

[00:20:40] Scott Messer: I mean, I, I know you, I know it comes from the signals and like the things that they're doing through the Sallie Mae network. 

[00:20:45] Scott Messer: Just talk about like sort of profile building and segmenting them. Um, are you proactively creating these segments? Are they falling into it? Is it stored in a data warehouse and you're querying out of it to create them? So then we'll get into like the activation of it afterwards. 

[00:20:58] Marco: yeah. No, no. That's a great [00:21:00] question. So we've got a bunch of different audiences, it's all based on our direct relationship. With the, with the consumer, with the student, and with their family, right? So it's all information that we get from them directly. And then we layer on, um, you know, my first hires had been data science people, right? 

[00:21:19] Marco: Those were the first people that were brought on to build this business. Were data scientists. And so it's a lot of, understanding in these customer relationships. You know, where do you go to school? What are you studying? What do we know about that school? Um, you know, what do we know about graduation? 

[00:21:42] Marco: What do we know about living on campus versus off campus? There's a bunch of different things there. So we have audiences, you know, we have got a sort of broad Gen Z audience. We've got college students and recent graduates. got young professionals and millennials, and then we've got parents and guardians. 

[00:21:58] Marco: And then within those buckets, we've got a [00:22:00] bunch of different slices of that We also do a lot of custom audience work. if we talk to an, what we call an, an endemic might be a grad school. So if we talk to an endemic and they wanna understand, how to reach somebody before they're going to grad school, can build propensity modeling around that. 

[00:22:22] Marco: So we can understand based on undergraduate degree where they are, a bunch of other signals that we have on them. What is the likelihood that this person's gonna go to grad school? 

[00:22:32] Scott Messer: And then is there a performance layer of it where afterwards, and you start running some of these campaigns, you're sort of validating like, yes, our segments do drive X or Y lift, and then those do the, and then do those signals feed back into the model. 

[00:22:46] Marco: That's exactly right. So my, our, our laser focus in the early days was, and, and continues to be a rapid. Test and learn cycle where [00:23:00] we, 'cause this is, we're launching this thing from scratch and it's brand new to the market, right? Pulling the audience, slicing it in different ways, having different hypotheses around what's gonna perform and having our queue of what these ideas are that we want to test, and then getting them in market and, and finding out does it work, does it not work? 

[00:23:17] Marco: And then bringing that intelligence back in and then optimizing against it. So that's really what we're trying to build is that cycle and the, the more advertisers we get, and the faster that cycle moves, the more intelligent we are and the more effective our audiences become. 

[00:23:35] Scott Messer: That's certainly the cycle. What about from like a, a media trading perspective and how is that team organized and how do you sort of work with advertisers on where you're going to spend their dollars, uh, across the web or tv or social or wherever it may be? 

[00:23:50] Marco: Yeah, so, um, we've got partner partners across, um, a variety of different channels. CTV, social, audio, digital at [00:24:00] home, web and social. So we have a variety of, of different. Um, channels where you can reach our audiences. SSP is Kargo Um, that announcement is, is coming out shortly, but I guess we're making it right here. Um, they, you know, they have been fantastic. Uh, they have a really strong creative capability. They 

[00:24:24] Tom Limongello: Yeah. 

[00:24:25] Marco: strong, rich, um, media and so they've been a great partner for us to launch with. Uh, and then, you know, there's all the reporting. So we work with, a lot of the, the leading measurement providers in the space, whether it's, um, Nielsen or Kantar or others. 

[00:24:43] Marco: Um, and so we layer that in and it sort of depends on the individual advertiser, uh, whether it's brand, direct, or an agency, and the types of things that they're looking for. 

[00:24:52] Scott Messer: It's a great setup. Big fans of Harry Kargman and Michael O'Shaughnessy and the whole Kargo crew. 

[00:24:57] Tom Limongello: Yeah. Yeah, we used to compete against them [00:25:00] when they were just in the mobile space, um, so I'm interested in sort of figuring out, like, because you are a leader in an early commerce media vertical, like you said, you're, you're the first really in education. Um, what is it that you need the market to do for you? What, what changes need to happen so that you know you can sell better? That people understand your product better. Um, like what you, you're, you're on your way to ascendant. You're gonna be chatting, uh, chatting people out. What are you gonna be talking about there? 

[00:25:31] Marco: So, you know, at Ascendant, um, which, you know, plug for those guys. Uh, my, my favorite, um, one of my favorite, maybe my favorite conference of the year, uh, lot of. Really smart GMs join. It's a sort of smaller group, and so it's a great space for, for me, uh, to, you know, reconnect with folks that are in a similar job and position and, and learn about, you know, the different [00:26:00] strategic decisions that they're making and, know, partners that they like and who, who's working well and what, what new products are working well. , We're gonna be talking about this balance that we were discussing a little bit earlier between standing up an ads business within your core business how that relationship works. Uh, in some instances there can be tension points and you need to, you know. 

[00:26:32] Marco: Uh, be open about those and un uncover what those are and solve those problems. And so, you know, uh, you know, for me, staples, Sephora, and, and Sallie, there's been some, a lot of important learnings around that. How to align incentives and how to make sure that the ads business supports the overall commercial enterprise. 

[00:26:51] Marco: So that's gonna be the, topic. Um, yeah, I'm excited. That's, that's in a, in a couple days will you guys be there?[00:27:00]  

[00:27:01] Tom Limongello: I will not. Um, but, uh, think that, uh, we, we know some people who are gonna be there and we're excited for them. Um, it does seem like it's a great time to be honest. Um, after gonna shop talk, and then I'm going down to possible, I don't even know if I could get there. Um, but it is only a year, so maybe next year. 

[00:27:18] Marco: there's so many. You can't, you can't go to a mall. 

[00:27:21] Tom Limongello: Yeah. Um, but yeah, I mean, that's why we feel lucky we get to, to do these types of things remotely with people like you, um, and go deep on this stuff. And so we appreciate you taking the time. What else are, like when you, you're talking to the community, like what's, required to get this sale done? Like, what is, is it any different from what you were doing? Is it just like what you were doing at Vistaprint, but with better data? Like what, how does it feel being out there in the market trying to sell this? 

[00:27:50] Marco: Um, so we will, I'll answer that in a couple different ways. You, the first thing you asked was around challenges. I think we're, as you said, [00:28:00] we're doing something new. The, the, the steepest learning curve for me has been around working within a financial institution, right? So we're, we're education finance, and so I have been getting a crash course on what that means and standing up a, a commerce media business within that context. very different from a retailer. you know, everything that we do is about privacy. Everything that we do is around trust. Uh, we never sell personal data ever. Everything's anonymized. Everything's aggregated. Brands never see individual level information, so that's been really important. Um, it's also been important for us to be selective about who we partner with and, and which brands that we work with. 'cause this is a very high stakes moment for, for college students. you know, for us, we have to anchor to is this offer relevant to this person? [00:29:00] And if we can anchor to that, then the rest we can solve. in terms of go to market, I think part of it, and we were just talking about this this morning with the Kargo team, part of it is in your sales motion, uh, how much are you  

[00:29:20] Scott Messer: incorporating  

[00:29:21] Marco: your audience set into an existing RFP where the buyer is looking for something very specific. 

[00:29:28] Tom Limongello: Right. 

[00:29:29] Marco: how much are you, getting the opportunity to like give them your whole go to market value prop, right? Because we're something very different. is, um, you know, it's, it's education media. What does that mean? It it's predictive commerce media powered by verified life stage data. What does that mean? know, so if you're getting an RFP that says, I want Gen Z. Okay, great. We have that, but we also wanna be able to tell our story a little bit more broadly. [00:30:00] And so have been, you know, winning moments to tell that story and share how we're different. Um, and you know, the more that that shows up in performance for brands, you know, the more momentum we gain. 

[00:30:16] Tom Limongello: What does that do to measurement then? Like do you have to have different ways of measuring because you're not doing one-to-one in the same way that you would've done in a retail media environment ? 

[00:30:26] Marco: Um, yeah, so I think, you know, measurement in some ways is a little bit more, um, unique advertiser to advertiser, So we had sort of like a standard. and measurement and reporting at Sephora. And we had some different options. Um, but here we're working with, it's mostly non endemics, right? So if we're talking to a CPG versus financial services versus you know, a grad school, [00:31:00] they're, they, they think about marketing in different ways. And so it's important for us to have a variety of different measurement partners that allow us to. Um, deliver the type of attribution methodology that they're looking for. So it's, it's, I'd say it's a, it's requiring us to be a bit more sophisticated about how we look at things. Um, you know, most of it, a lot of, a lot of it is all in platform. And then there's other stuff that we're doing that's more custom, depending on the individual advertiser. 

[00:31:32] Tom Limongello: I like to have, when I'm asking retailers or commerce media network leaders, um, to try to. Tell me like the boldest thing they've ever done in the retail world um, so you have lots of experience. I'm hoping that you can answer this question, but the, the context that I give is, Sam Walton back in the day, put a whole bunch of flip flops on a desk and they sold like hotcakes, but it was very unconventional. 

[00:31:58] Tom Limongello: Nobody thought that these [00:32:00] sandals were gonna go, and, and he, he, he was able to, you know, create a category from nothing. Um, the leaders of Dollar General did something similar. They took a, a big run of pink corduroy pants and instead of turning it into a category, they just turned it into an ad that basically everybody, uh, in the town was, was talking about where they got their corduroy pants from. Um, and then the last one is five below they were selling sporting goods. They sold their basketballs deflate, or they shipped them deflated so they can get more 

[00:32:29] Marco: Yeah. 

[00:32:30] Tom Limongello: to the customers at a cheaper price. So like. big bets or big swings is something that retailers love to do, um, in, as somebody in their retail and commerce media space. what is something that you've done or have seen done in, in, in, in your career that you think is, is a cool, bold move that, uh, we should learn  

[00:32:47] Bold Moves: Fluid Ads & Sephora Squad 

[00:32:47] Tom Limongello: from? 

[00:32:49] Marco: I'm gonna give you two. So the first is from Staples and then the second is from Sephora. So, um, Staples. You know, we, [00:33:00] we, we wanted to continue to grow the business and specifically in sponsored products because that's where we saw some of our best performance. And we were limited by the number of slots in the grid that we could get. So, you know, what we realized is the customer doesn't really care if a product is sponsored or not. they just care that it's relevant. And so 

[00:33:22] Tom Limongello: Yep. 

[00:33:23] Marco: of this sort of sandbox approach ofthese are the areas that are gonna be organic and these are the areas that are gonna be paid didn't really make sense from a customer experience standpoint. you know, I was fortunate to be working with, um, retail media visionary Andreas Reiffen at Um, 

[00:33:42] Tom Limongello: Yep. 

[00:33:43] Marco: their CEO, they're now Pentaleap, but we, we tackled this problem together you know what we, what we ended up doing was. We decided if we can take the organic results, [00:34:00] number of them, let's say the top 100 and base the eligible SKUs, this is not as cool, I realize in, in saying it as pink corduroys, but this is the space that we operated, 

[00:34:11] Tom Limongello: Yeah. 

[00:34:12] Marco: make those, the eligible SKUs instead of all of the different SKUs that were, you know, that had budget against them. We could make the product more relevant and more consistent with the organic algorithm. This would allow us to, um, you know, drive up relevance, quote unquote, and drive up, click through rate. And in doing that, we could get the organic, the page owners to give us more slots. So, um, this evolved into something where the slot could be in a bunch of different places. 

[00:34:43] Marco: It didn't have to be sort of locked into, you know, number four and 12 and whatever it used to be, but it could move around. Depending on the product, and this evolved into what Crealytics called Fluid Ads. So this was really cool at the time. I, I still think it's really [00:35:00] cool and I, I, you know, in the years since, uh, those guys at Pentaleap have, have taken this product and really scaled, um, so that was really fun innovation to be a part of. And then at Sephora, one of our fastest growing channels was TikTok. And in the beauty space, not sure how plugged in you guys are to beauty TikTok, but um, it's pretty amazing. And the passion of our customers and the influencers on these platforms is, is incredible. So you've got an influencer who will take, his or her followers through their entire beauty routine and show you not just products, but how they use them and how to work, work them together. 

[00:35:45] Marco: And it's very. lot of this is low production, very authentic content. we thought, how do we get, how do we get the ads into something like this? And so we, uh, stood up Sephora Squad, which [00:36:00] was a group of maybe a hundred different influencers that they would work with individual brands and, and we would present them to them, and it would be something that was authentic. And then that content could be used TikTok. And so some of what you were seeing was actually Sephora Media Network, uh, at work in, in TikTok, in these very authentic, places and, and formats. So that was really cool and it was all sort of built off, you know, understanding our audience. We wanted to be where our audience was spending their time speak to them in the formats and creatives that. Resonate most with them, and turns out when you do that, it performs best for the brand. 

[00:36:44] Tom Limongello: Well, thank you for the, the TikTok example. No, I'm not very up on it, but I'm always curious about, you know, that channel and, how the, you know, how powerful it is. but while you were talking about it, I was thinking about it, you know, Scott [00:37:00] needs to be doing like ad ops in the background on this pod, and I need to be maybe doing like a rich media creative to take people through the, to the influencers, how the, how the sausage is made. I love hearing these stories, so thank you for taking those in. We wanted to thank you for being on the Middleman podcast. Um, really appreciate you taking the time. Um, you have a fascinating story. 

[00:37:21] Marco: Thank you so much for having me. I really enjoyed the conversation. And uh, Tom, let's get together at Possible down in Miami. 

[00:37:27] Tom Limongello: yeah. Sounds great. All right, we'll see you then. 

[00:37:29] Scott Messer: Thanks, Marco. 

[00:37:30] Marco: Take care.  

[00:37:32] ​