Thread by @Muzzlebuster

1/
I'm doing this write-up as a partial response to @realroseceline's post about $ZETA yesterday, linked below. Rose’s post was absolutely top-class, and I admire the writing and thought process very much. If by some strange miracle you are following me and not yet following Rose, stop what you are doing and go follow that account immediately.

Some of my own views on the topic contrast some of Rose’s, so I wanted to write about it. No pressure of course, but if @realroseceline or @wealthmatica, or anyone else for that matter, would like to share thoughts on this, I would welcome it.

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First, there's an argument that $ZETA operates (almost) solely at the bottom of the funnel where intent is already at least partially defined. Also up for discussion, the view that Zeta only targets consumers who have previously engaged (at least in some small way) with the client-company.

🌹 “That is not new customer acquisition, it’s called lifecycle marketing. Lifecycle marketing is what happens after someone already exists in your business in some form, whether they are a customer, a visitor, or just someone who engaged once with your email or app.”🌹

🌹“If you take a group of users who already showed intent and improve how you reach them, how often you reach them, and what you show them, the returns will naturally look higher. You are improving conversion on people who were already close to converting, which is a very different task than generating brand new demand from brand new customers.”🌹

$ZETA absolutely does do this, but they should not be put in a box as doing only this. I'm not even sure we can say with reasonable certainty that they do MOSTLY this, though I would forgive speculation that this is the case (since they don't scream it from the rooftops, though I don't personally subscribe to that argument). They do “generate brand new demand from brand new customers.” Stick with me here.

3/
A business that is using ZETA's platform does not have a window of potential customer profiles that is limited in scope to only customers that they have interacted with in some way before. The business’s window of potential customers spans the entirety of the identity graph. Meaning all of the 245M US consumer profiles. That's almost the entire US population. If at any point the stars align data-wise or trigger-wise, any one of these profiles can be the subject of an ad reaching them from the business.

🌹“Now compare that to true new customer acquisition, which is fundamentally a different problem. Instead of organizing known users, you are trying to find new people who have never interacted with your brand, have no data history, and may not even know your product exists. That is not a matching problem, it is a discovery problem that requires scale, data, and constant experimentation.”🌹

If Joe Shmo clicked on a video game ad in an email 3 years ago and bought one, today, when Micro Center becomes a Zeta platform user, Joe may at some point be targeted by Zeta’s platform with an ad for a gaming monitor from Micro Center, even though he has never even heard of the place before. And he may buy it. So, from the perspective of Micro Center, Zeta has acquired a brand new customer for them. That is not traditional top-of-the-funnel acquiring, but from the perspective of the business-client, it looks and feels the same, only more efficient, and with more purposeful targeting.

4/
$ZETA supplies explanations and tutorials for its platform users in The Zeta Knowledge Base. One page in particular gives step by step guides for acquiring brand new customers. The page is titled "Prospect Audiences":

"Prospects – Select this option to segment new audiences from the Zeta Data Cloud, and target them through paid media channels like Display, Audio, and Connected TV.”

Matched lists are also important:

“A matched list is a set of first-party individuals uploaded into the Zeta Marketing Platform, who are then matched to Zeta's Data Cloud and further enriched with potential intender audience membership and other data points. This matched list can then be activated against Zeta's omnichannel solutions or can be extended using our AI-driven lookalike modeling capabilities.”
Source: knowledgebase.zetaglobal.com/kb/prospect-au…

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The same page describes the lookalike workflow, giving clients a way to answer the following important question:

"Who are the top prospects known to Zeta that are most similar to my seed audience so that I can achieve my goal of reaching X million prospects across channels?”

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Finally, Zeta describes its audience sources here: knowledgebase.zetaglobal.com/kb/audience-so…

"Zeta Data (Prospects) — Zeta's proprietary second- and third-party data set, which gives you access to millions of anonymized consumer profiles. This source helps you expand beyond your current customer base, discover new prospects, and reach audiences that match your target criteria—across email, display, CTV, social, and more.”

Of course, the data around those profiles, all 245M of them (in the US), and the signals that fly, matter for whether there is a match. And I think this is why people think it's a bottom-of-the-funnel only type of business model. Many of those signals do indeed come from brush-ins with the company, like clicks, or emails, or some other kind of engagement; i.e. the bottom of the funnel. Other signals, however, don’t involve the company at all, yet an ad from the company will still end up going the way of the prospective customer. This acts like a top-of-the-funnel driver for the client.

Zeta does deal in prospecting and new acquisitions, not just lifecycle and remarketing.

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Next topic of discussion:

🌹 “There is also a natural ceiling to this model that people don’t think about. You can only optimize the users that exist in your system. If new demand is not constantly being created at the top of the funnel, the opportunity at the bottom eventually slows down.” 🌹

The way $ZETA gets paid is essentially by granting companies access to their first party data/profiles (yes, simplified, but still true). The reason the economics work is because there is no ceiling on the number of clients Zeta can sell this access to. Again, bear with me.

The number of profiles in the graph does not need to grow for Zeta to continue to grow because they will keep acquiring client businesses. The reason I make this point at all is because I think there is a view that, in ZETA's case, top-of-the-funnel acquiring means the number of available consumer profiles expands, i.e. more consumers in the identity graph. But the number of profiles is already almost the whole country. It's a big potential audience in the data graph/profiles, and top-of-the-funnel in this model means growing audience subsets for clients, as I showed above that Zeta actually does through prospecting and putting together look-alike audiences.

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Zeta is a connector of two ends. One end is the profile and the other is the business. A ceiling exists if both ends are static in number because you can only optimize the users so much with the businesses you service, and then there is no more upside. If the number of customer profiles goes up, there are more profiles to optimize. If the number of profiles is static at 245M, then you have to increase the number on the other end– the client-businesses. If the number of businesses increases, each customer profile in the graph gains in potential monetizability because each profile now has new potential transactional connections.

If either one of the ends that Zeta works to link up increases, there is no ceiling.

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What's interesting is that the more businesses that are using Zeta and have access to the pool of profiles, the more valuable each singular profile becomes. This is because there are more potential transactional touchpoints now per profile. I am not suggesting that every profile will mingle financially with every business that uses $ZETA. But it is true that every new business coming on is potentially a new recipient of a transaction from any given profile, and so each profile is now exposed to more businesses.

More potential business per profile.

That means that with every new business using $ZETA, every profile and the dynamic data attached to it gets incrementally more valuable. There are real economics hidden in that perspective.

10/ End
As a bonus aside, these profiles and the dynamically moving data that are gaining value with each new business coming on board are placed into goodwill when they come from an acquisition. Something to think about as most think of goodwill as a value-sucking line item. But that's another discussion entirely.

I would love any and all thoughts.