THE LARGEST PARADIGM SHIFT IN DIGITAL ADVERTISING SINCE THE RISE OF PROGRAMMATIC IS CURRENTLY UNDERWAY –WHY RETAIL MEDIA IS POISED FOR A DRAMATIC RISE AND HOW ZITCHA IS POWERING THE RETAIL MEDIA REVOLUTION‍

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14 NOVEMBER 2022

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After having bootstrapped the business to date, we are thrilled to be partnering with Troy and Jack, and the rest of the Zitcha team, leading their $4.8mSeed round to fuel their growth as both Australian and global retailers look to establish a retail media network.

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PROBLEM AND SOLUTION 

The retail media opportunity

For decades, advertisers have grappled with the challenge of connecting their ad spending to actual customer purchases. Figuring out whether they were delivering impressions for the right price, in the right channel, has long been an imperfect science littered with assumptions, data extrapolations and disparate measurement solutions.

Enter retail media, which is changing the game for advertisers, retailers and consumers alike. Retail media is an advertising business set-up within a retailer (or any business with first party data) that allows advertisers to purchase inventory across the retailer’s owned (in store screens, catalogues, website) and extension (Facebook, Google, TikTok) assets, using first party data to connect with consumers at different points throughout the buyer journey.

For retailers, a retail media network allows them to leverage their existing advertising inventory and first party data to unlock an entirely new revenue stream with margins substantially higher than traditional retail, whilst also removing existing opex by supplier funding advertising. Retailers are then able to re-invest increased profits into improving their core business.

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For advertisers, this allows them to close the loop on attribution by directly connecting audience impressions with omnichannel transactions and business results, driving higher ROAS. By linking content and commerce, advertisers are able to gain direct access to customers with high-intent to purchase by leveraging a retailer’s increasingly valuable first party data, and delivering highly relevant content, increasing conversation rates, and improving customer experience.

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However, whilst the Amazons and Walmarts of the world have the resources to build the tech and team required to establish a dedicated retail media business, this is not the case for the majority of retailers, which has left many retailers unable to capitalise on this revenue opportunity – until now.

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‍Where does Zitcha fit in? ‍

Zitcha is an all-channel media buying platform, providing retailers of all sizes with the tools to build and grow powerful media businesses. For advertisers, Zitcha offers them the ability to access their audience at or near the point of purchase across all-channels.  

Zitcha provides a centralised platform and seamless experience for resource-constrained retailers to manage and report all their media activities. For advertisers, Zitcha allows them to leverage first party data and purchase across multiple retailers and multiple channels on a self-serve basis, all while accessing powerful reporting and analytics, helping to maximise ROAS.

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INVESTMENT THESIS 

Market-leading solution in an incredibly large and fast-growing market – retail media has been touted as “a paradigm shift in advertising” ‍

Retail media is one of the hottest spaces in advertising, already representing an A$50 billion opportunity in the US and A$850 million in Australia and is expected to expand at ~25% p.a. over the next 5 years. McKinsey estimates that ~A$2 trillion (yes, trillion) of enterprise value will be generated in the space by 2026 in the US alone.

So what’s driving this incredible growth? In a world of deprecating cookies and increasing privacy regulation, the value of first party data continues to rise. Retail media networks allow advertisers to buy against a retailers first party data and increase conversion by accessing their customer at or near the point of purchase, whilst providing retailers with a highly profitable revenue stream. A win-win for retailers and advertisers alike.

Within this incredibly attractive space, Zitcha is the only independent, purpose-built retail media solution allowing retailers to sell, and brands to buy, across any marketing channel they want in the one place. By uniquely blending onsite, offsite and instore media, Zitcha both simplifies the advertiser buying experience, and enables retailers of all sizes, with no experience as media companies to unlock a previously unavailable revenue stream, without the need for a multiple platforms or complex integrations. ‍

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Stellar founding team with deep industry expertise  

From the first meeting, it was immediately clear that Troy and Jack had a unique insight into the problems faced by participants all throughout the retail media ecosystem – there is no team we would rather back to tackle this problem. Troy was previously a co-founder of Tiger Pistol, the world’s #1 social advertising automation platform for local advertising and successfully exited the business in 2021. Jack is the founder of Hatched, Australia’s leading independent media agency, which recently won Media Agency of the year. With 35+ years of combined experience scaling and managing successful businesses in the AdTech and media industries, you can see why we were excited to back Zitcha. ‍

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Strong early traction and delighted blue-chip customers

It's hard not to love a business with metrics this strong, this early in the game. Since officially launching in early 2022, Zitcha has experienced MoM revenue growth of ~20%. And we're not the only ones impressed with Zitcha, with some of ANZ’s best known retailers, including Adore Beauty and The Warehouse Group on the platform as happy customers. And brands love it too, with some of the world’s leading brands like Microsoft, LEGO and Asahi purchasing media via Zitcha. With fantastic customers and great metrics, we're excited for what’s next with Zitcha.  

WHERE TO NEXT?

As more and more retailers (and first party data owners) globally, begin to move into the retail media space, the need for a purpose-built, all-channel media buying platform will become increasingly relevant. And with a team proven in scaling a business, an expanding product suite and best-in-class product, Zitcha is poised for global growth and ready to sit at the epicentre of the retail media revolution. And we're excited to support Troy, Jack and the Zitcha team every step of the way.