French digital specialist Marco Tinelli ‘s goal is to build a data backbone for the entire advertising industry that is more complete than that offered by Google, Facebook and Amazon because it includes both offline and online shoppers and conforms to data protection rules.
He is one of the three founders of startup studio RedPill. RedPill has launched relevanC ,a new company which is aiming to change the way advertising works, in partnership with Groupe Casino, owner of supermarket chains such as Franprix and Monoprix as well as online commerce site Cdiscount.
relevanC collects data about the shopping habits of more than 15 million shoppers in France to help Groupe Casino and other participating companies better target consumers.
Tinelli has a strong background in digital media. He is the founder and group president of digital agency FullSIX, which had a global staff of nearly 700, with offices in France, Portugal, Spain, Italy, the U.K. and the U.S., and a client list that included L’Oreal, Vodafone, Bayer, Renault and LMVH, when it was sold to Havas in 2015 for a reported $75 million. Tinelli continued to drive FullSIX from within the Havas group as its CEO from 2015 until Sept. 1 of this year.
Soon after joining Havas Tinelli became a shareholder and board member of Paris-based startup studio RedPill, which he founded in late 2015 with Sergine Dupuy and Teva Choisnet. RedPill launches its own startups and also works with big groups on the founding of startups based on new business models and technologies. Tinelli now works for RedPill full-time and is overseeing the launch of relevanC, which is 80% owned by Groupe Casino and 20% owned by RedPill. He recently spoke with The Innovator about how RedPill is working with Groupe Casino and the potential impact of their collaboration.
Q: First please explain what Redpill is and what it is trying to achieve.
MT: RedPill is a startup studio that launches digital startups based around new disruptive models. We launch our own companies such as Beeboss or Apicare in areas where we don’t need alliances and in parallel we also launch new startups with major groups as we also believe there is value in building partnerships. Big groups have a lot of unused assets. Many times these groups has their own means and own ways of doing things but haven’t found a solution for leveraging certain assets. If they want a company to reside outside of their group they provide us with these assets and we can build and manage new startups and recruit people from the outside. If people from the internal team want to join the new startup we require them to accept the risk by quitting the group in exchange for equity in the new venture.
Q: How many spinoff companies from big groups has RedPill launched so far?
MT: In addition to relevanC we have already launched Pharmacercle, and we are also working on another one with a famous chef that will be announced before the end of this month. There are another three startups that are in the process of being launched.
Q: What was the thinking behind launching relevanC with Groupe Casino ?
MT: The entire advertising industry is being digitalized. Digital investments are increasing because consumers are moving away from using traditional media such as television, the print press and radio. The second thing is digital is more agile, more data driven, it allows advertisers to target people in much more accurate ways, so there are two things: being data driven and agile and the strong push into digital advertising. Google and Facebook are the only players on a global and local basis. But these players only use digital data — they only know about what you search for online.
Q: You only have to look at some of the targeted ads to know that they can be totally off-base in their assumptions.
MT: That is because their assumptions are based on how you behave in digital space. The challenge is how can we gather more relevant and more accurate data? The answer is by looking at what people are effectively buying and that is where relevanC steps in. There is lots of digital data but it is not fully accurate. Stores still represent 95% of consumer purchases. Offline data is about what you buy on a day-to- day basis. We can, for example, more accurately know you have a baby if you are buying diapers than if you are simply reading an article about babies.
Q: How do brick and mortar players keep track of what shoppers are buying?
MT: Mainly through loyalty cards. There are 12 to 15 million loyalty cards used on a daily basis in Groupe Casino stores and this gives us a set of data that is much more accurate. Groupe Casino also owns a digital property — CDiscount — so we can connect to the digital ecosytem as well. The combination of offline and online allows us to be much more accurate and complete in building profiles for advertisers. Another advantage is if you use Google or Facebook you have to advertise with them but our clients can go wherever they want to advertise — if they want they can use a Google property or a Facebook property — because we don’t own any media and therefore do not force the data media bundle.
Q: Are 15 million shoppers a big enough sample?
MT: It’s already a massive start, but we are looking to engage with other retail players to increase this figure. Let’s not forget that with CDiscount, a local leader, we will reach 50 million people in total, including tracking offline buying for 15 million. We need to enlarge our vision to include segments such as fashion and beauty products that are not always purchased in supermarkets. So we are inviting other players to enrich the data. We want to build an agnostic backbone of data for the entire advertising industry.
Q: Why would other companies add their data to a company that is 80% owned by Groupe Casino. What is in it for them and what are the terms?
MT: Every player that joins relevanC continues to own his own data. They agree on what data elements they want to share. Building a profile is like brewing good wine. You know when pouring if it is good but you can’t know what grape gave it what taste. Once you pore your data in it contributes to a global vision. We use machine learning and our coders evaluate the info. First, new partners who contribute data will be remunerated for that. Second, they will also get — on a regular basis — feedback that says “this is the consolidated vision of what we know about the profiles you have sent us.” Finally, we will also consider doing revenue shares on specific elements of data we are seeking.
Q: What sorts of insight will this targeted data bring?
MT: We are providing data that will allow them to buy the best advertising space that is the most relevant to them across the Internet. Today only about 30% of advertising spend will reach the desired targets. We can help get it closer to 100%. We are giving the tools to agencies and advertisers and research companies so that when they are launching new products they can accurately measure how it picks up in-store and also measure it online.
Q: Where are you on the rollout?
MT: We need to make advertisers and ad agencies understand this new model first and that takes time. They need to understand it is it legal and GDPR compliant. We will be there by end of this year.
Q: Do you have ambitions to go beyond France?
MT: If you can crack France you can do it anywhere. We are very focused on this for the moment. It is a new frontier. We have a 30- person team working day and night using machine learning, algorithms and linking in-store, websites and mobile. This has never been done and we are able to do this effectively and efficiently thanks to the nature of our partnership with Groupe Casino. Other clients are asking us if we can deliver some additional services we haven’t even thought about. The market is eager for agnostic, data driven solutions.
Q: What sorts of data are they asking for?
MT: We not only have actionable data but can also provide straightforward statistics such as ‘is baby powder selling more than milk?’ Once you have such insights the opportunities are unlimited. When you are trying to figure out what services to launch you can have a predictive model, you can know what are the best operating stores, the best ways to open a new store, what segments of clients are the most loyal and frequent. You can know whether you are selling more or not on a daily basis rather than focusing on how many people saw my ad. You can know who are the people who are buying more of the product –men or women- and who is responding to the campaign and then the use the information to start a new, even more targeted campaign. With our platform you need three minutes to do what used to take two weeks full time to do and the data is fresh from the day before.
Q: So how much is this worth?
MT: It is worth a lot. If you measure the value in terms of increased performance you can double the performance of campaigns. If we are good enough and people get it we might change in a significant way the way the advertising industry works.