Retail media is moving into a rocky adolescence.
The sector has recently seen a flurry of mergers, acquisitions, and consolidation deals aimed at helping marketers collect and combine lucrative shopping data. Four recent examples—Spins’ acquisition of MikMak, Omnicom’s merger of TPN into Flywheel, Podean’s purchase of Ad Advance, and Infillion’s acquisition of Catalina—show that as advertisers demand more, the business of retail media is getting harder, five analysts and retail experts told ADWEEK.
Notably, the terms of the recent M&A have not been disclosed. Two sources described the acquisitions as opportunistic, indicating a shift within the industry. As retail media has matured, shopper marketing firms are looking for an out to grow. And newer retail and tech firms are looking for shopper marketing expertise to potentially grab bigger ad budgets across digital and shopper marketing.
“This is the stage of retail media where the easy money is gone,” Andrew Lipsman, independent retail media analyst, told ADWEEK. “If a lot of these smaller companies are growing like a hockey stick early on and all of a sudden it hits a wall, then that’s a very tenuous position.”
Shopping for data
For Infillion, the acquisition of Catalina’s in-store and digital coupon systems fit with Infillion’s broader adtech apparatus, explained Rob Emrich, executive chairman and founder of Infillion. Infillion has previously acquired adtech companies including MediaMath, Gimbal, and Fysical, billing itself as a composable retail adtech company.
As in-store retail media has grown over the last several years, Catalina often fought retailers for the same ad dollars, Emrich said. Infillion believes that Catalina’s data will be more valuable to retailers when it’s combined with Infillion’s other retail media services.
“If there’s more congruence between the coupons that they’re getting and their digital ad exposure, that’s better for everybody,” Emrich said. “The retailer has a better idea of what matters to the customer. The customers have a more coherent experience with that retailer and the brands that they work with.”
Transactional data like what Catalina has been gathering for decades is valuable for advertisers as long as the data can be used across a wide swath of ad inventory, one source said. For example, Amazon’s DSP has grown significantly because of Amazon’s first-party data, the source added. By the same logic, Infillion could gain value by plugging Catalina’s insights into MediaMath’s DSP.
Similar to Catalina, Omnicom-owned TPN is a longtime shopper marketing firm. Founded in the 1980s, the TPN specializes in helping brands drive in-store sales. In early January, Omnicom absorbed TPN into Flywheel as part of a bigger bet on commerce that combines retail data with technology and sales data.
