Okay. All right. I think in the interest of time, we're going to keep moving along. It's my pleasure to welcome the team from Ibotta here to the conference on our fourth day and making his conference debut, Chris Riedy, CRO. I'm going to read a safe harbor, and then Chris and I are going to get into the conversation. Today's discussion may contain forward-looking statements. These statements reflect Ibotta's current expectations and are based on the information currently available to Ibotta, and Ibotta's actual results could differ materially. For more information, please refer to the risk factors in Ibotta's recent SEC filings, including its 10-K and its 10-Qs. Okay. We got through that.
All right, we did it.
Chris, I know you're relatively new to the company, but for those who don't know it as well, either in the room or listening, talk to me a little bit about just level-setting the story around Ibotta and what the company's mission is.
100%. 100%. First, thanks very much for having me. It's great to be here. Glad to be here on your fourth day. Hopefully we keep it interesting.
Yeah.
Ibotta, think about it. Mission: make every purchase rewarding. If you go back 13 years in time, Bryan Leach, our Founder and CEO, really had this idea that there was an opportunity to connect shoppers with manufacturer offers or coupons and retailers. You can create this kind of holy trinity of you've got a shopper that's interested in something, a manufacturer can compel them to buy it with an offer, and then they can go into a retail outlet and make a purchase. That business came to life through a mobile application called Ibotta. You'd go to the App Store, you'd download it, and inside of that Ibotta application, you'd find these manufacturer offers. You could link your loyalty card from a given retailer, and everything works really great. Over the history of time, about 50 million downloads of that app. Pretty meaningful and a really nice business emerged.
I think the company from there realized that there might be a bigger opportunity. The bigger opportunity really stems from, rather than saying to the consumer, "You've got to come to Ibotta every time to find these offers," what if we met the shopper where they are? Six, seven years into the experience, started thinking about how could we do that? Ultimately formed a partnership with Walmart and helped build the Walmart Cash program that effectively took this solution and turned it into a white label. Same concept. We've got shoppers, we've got manufacturer offers, but at this time, it's actually at the retailer. The shopper finds it in the flow of shopping within the Walmart ecosystem. That kicked off what we call the Ibotta Performance Network. We work with Walmart, Dollar General, DoorDash, Family Dollar, Instacart. We've got a broad swath of partners there.
What really happened is you go from this install base of 50 million people, which is big, but again, remember they got to come to Ibotta, to now you go to over 200 million shoppers. Rather than meeting them at Ibotta, you're meeting them where they shop every single day. That's just incredibly important. I think what we'll talk a little bit about today is you go from version one to version two, and now we're emerging into version three, which is really about doing that exact same thing, but delivering more obvious value to the manufacturer. How do we help the manufacturer understand that these coupons that they're providing are actually contribution margin-positive revenue drivers? They're not just tactics. They're actual revenue drivers, profitable revenue drivers.
I want to build on that because I think one of the central themes that we keep coming back to in what we write about the company is that there is a desire out there among CPG advertisers and big brands to be at the bottom of the funnel where decisions and purchases are being made. Now you're in this new transition for the business. Level set what this transition looks like, and how is the conversation evolving with your partners around adopting the transition and understanding what it might mean for their businesses?
100%. I think first and foremost, we have to take a customer-centric approach. Really being customer-obsessed, understanding what the customer needs, building trust with the customer, and then ultimately building alignment. What Bryan Leach realized, to his credit last year, post-IPO, he went on a bit of a roadshow and said, "Hey, what more do you need from us?" He asked the right question to the marketer, and they said, "We need a little more proof. We love you as a partner, but we need a little more proof that this is really driving, again, profitable revenue for me. This is not just some dollar we would have earned anyways." With that learning, we have to evolve or we have an opportunity to evolve a little bit with regard to who we talk to. Historically, think about us maybe more as a service provider. We're a vendor.
Hey, I've got a promotion. My boss asked me to run it. Ibotta is an amazing digital promotions platform. I'm calling them. We did that rinse and repeat for a long time. We're moving now to more of a solutions provider where we're going to move up the stack inside the company. We would have worked historically with a center of excellence around coupons or promotions. We would have worked with a procurement team that says, "I want the best value. Please give us the best value. We'll give you our promotions." Now we're going to business leaders. The head of a business unit, or maybe the CMO, or maybe the CEO to find the right person to share the story that we're going to deliver profitable revenue growth for you, and we want you to hold us accountable for that.
If we don't do that, we're not doing our job. That's an evolved conversation that in some instances are old contacts, the right people, but in many, we have to, what we would call, multi-thread our way through an organization so we can find the people that are most interested in that.
Okay. Let's probe on that theme a little bit because when you go through that transition and you talk about making sure you're talking to the right people in the organizations you're trying to garner on the client side, talk a little bit about the transition the sales organization has to go through so that you're optimized in your go-to-market strategy against what your sort of business goals are.
A couple of big things. First thing, I'm going to say it again just because it's so important. Our company has to be customer-obsessed. We have to just live and breathe what the customer needs. When the customer wins, we win. That's our business model. We are only paid when we actually move a product for somebody. That's the first thing. As it relates to the sales team, there's a lot of simplification that we're doing right now. We've moved to a two-channel system. We have an enterprise sales team and we have an emerging sales team. That enterprise sales team, it's white glove, it's high touch, it is in front of the customer, it is in person, and it's really working on not just one relationship. It's trying to build multiple relationships across the line. The emerging side's a little more scaled.
That's going to be for more of an emerging or a mid-market company, and we want to find the solution that's really easy to buy, really easy to work through. That's the first thing I would say. Second thing is helping our teams manage a smaller number of accounts. When you think about, you know, if you're on an Excel sheet or a whiteboard and we say you've got two clients, two consumer packaged goods companies, well, underneath those brand names, you have business units. Underneath those business units, you've got sub-brands and child brands. That's a lot of work for a single person. We've worked really hard to think about the right account load on a rep-by-rep basis such that we can actually do what we want to do. We want to be able to go in and multi-thread, et cetera, et cetera. That's a big change for us.
We're really being thoughtful about the folks that we've got. Some great folks on the team are doing really great work. We want to augment those folks with new hires that have worked in a performance marketing space before, that have had these conversations with brands and that understand the key tenets of performance marketing. That's critical on the sales side. I don't want to leave out, though, if you think about sales support, think about B2B marketing. We've made some changes, as we've talked about over the last six months, where we've moved the B2B marketing organization into the revenue organization. That's critically important because if those two teams aren't working harmoniously, it's not going to work. You have to have the right story. You've got to have the seller informing, "Okay, this is what we're hearing." How do we take that back and forth?
We've made that change to not only do better product marketing and sales enablement, but also to lean into training and to really invest in our sales teams such that they have the right material, such that when they show up to talk to that consumer packaged goods company or packaged goods company, they're doing so in an empathetic, thoughtful way. Additionally, we've built a sales operations function or revenue operation function that didn't exist before. That is really about a couple of things. One, it's about just being highly effective from a how are we running the business standpoint. It's also about how are we forecasting the business, building the right tools, building the right systems. There's a lot of software that we all know about that exists for salespeople to track their calls and build pipelines and make it more visible.
You have to actually go implement all of that. The last thing I'll say that I've been really encouraged by inside the company is the company's commitment on the product side to lean into systems and tools that just make selling more simple. If you think about launching a campaign at a big performance marketing or any digital media shop, Meta, Google, Snap, whatever it may be, it's pretty easy. You go pretty fast through it. There's opportunity at Ibotta for us to not only make that better for the end customer, the self-service customer at some point, but also for our teams. That is really important to me. I've been, again, like I said, just so appreciative that it's not just build this great new thing in the future.
It's also how do we take what we have today and make it better and better and better so that our sellers spend more time in front of their customers and less time doing keystroke manual entry of things.
Okay. Understood. Maybe just one follow-up there, because you did do a nice job of laying out sort of the before versus the after. Maybe just one follow-up would be when you're talking to clients, especially with inside CPGs, how can you reflect on the way they want to buy versus how you're changing their mindset around your product set and your platform?
Super helpful. You said it a few minutes ago. CPGs want to get further down the funnel. That is known inside of the CPG. That is maybe the CEO's point of view, maybe it's the CMO's point of view, maybe the media team. Definitely, if I have hair care or family care or laundry care, I want that. Traditionally, the center of excellence for promotions hasn't been as focused on how am I finding, how am I optimizing to profitability, or how am I really driving growth at that level? Think about promotions as an over 100-year-old tactic, born offline. It's a little blunt force in many instances. That human, their job has not been to come back to the organization and say, "Hey, I found a more profitable way to do this. I found a way to grow business in a different way.
I found a way that might be crossing the chasm into performance marketing." That's the evolution. It's making sure that person, we don't want to go around that person. That's a great partner of ours. It's making sure they understand where we're going and then asking them, "Who's the right person to get this in front of inside your company?" What I'll tell you is I've only been here for nine months. We've been really doing this maybe for a little bit longer than that. Here and in my previous experience, it's not a one-size-fits-all. It's not the same person at every company that's going to make the decision.
That is why it is so important to take that customer-centric approach, to be really thoughtful, to be really empathetic, to understand their business so that you don't show up saying, "Hey, I want to sell you something." You show up and say, "I want to solve a problem for you." That might be the CMO, it might be the CEO, it might be the head of media, it might be the head of the business unit, as I said. The key thing is making sure we understand their business so that they're willing to spend time with us.
Yeah. To that point, sticking with this theme of building confidence and moving people towards an understanding of the bottom part of the funnel, how critical is third-party measurement to advertiser confidence, budget allocation? Talk about some of the building blocks there to get to a point where there's data and insights that can help inform this decision on behalf of your clients.
Yeah. Let me just start by saying third-party validation, I think it's table stakes, full stop. I'll back up a little bit and say, when we sit down with a CEO or CMO or all those people I just mentioned and we say, "Hey, if we could deliver $100 of revenue for you for, call it $30, would you be interested in that?" The answer is yes. It's an obvious answer. You unpack for them, okay, here's what we've seen with your campaigns in the past. They say, "Wow, okay. Does my team understand this? This looks a little bit different than traditional promotion." You present all of this upfront and they're compelled. Usually you can get somebody into a pilot that way.
To get somebody to really get to that rolling, "I want to do this all the time and I want to increase revenue or I want to increase spend with you," third-party validation is critical. That's something that is very normal in this space. 10 years ago, when I was at a different place, we weren't looking as much at sales lift studies. We were looking at what was called brand effect studies. Marketers would come to us and say, "We ran this great campaign. You told us it was great. Could somebody else tell us it was great also?" We contracted with third parties like at that time Kantar and Millward Brown, and they were great partners to us. We are going to go down a very similar path here where we will have the results. Excuse me, it's very important for us to provide those results.
At any time when a manufacturer wants it to be validated by a third party, we want to do that. Like I said earlier, we win when they win. It's really critical that they see that and they believe that because once they do, that's when you'll see the revenue truly accelerate.
One of the questions we get, and there might not be a great answer today, is in terms of when you get there so that you feel confident in what you've built and what you've scaled, that it can drive decisions. Any thoughts on how we get from here to the end state of this so you feel the most confident in it?
Gosh, I wish it was more than just like doing the work. You know, software, building software and taking software to market is, you know, with AI, machine learning, everything's so fast, but you really have to do the work. That's one of the things that compelled me to join the company. I just have a tremendous amount of faith in the folks that are building the software at Ibotta. It's really important that we do that in a very measured way. Think about, okay, we're going to go a little bit, we're going to get in front of customers, customers are going to use it, they're going to give us feedback, take that feedback, now we go a little bit further. Keep doing that. That's what's in our control, right? That's what we're going to keep doing. We're going to keep evolving.
I think everybody's heard Bryan talk about how we're doing that. The third-party stuff kind of runs parallel to that. Where we are, we've identified third parties. We're working with a couple right now. We're really encouraged by that work. If you think about how that evolves, you go from manually passing campaign data to one of those companies. They run a big analysis. They come back. It's like, okay, what did it say? It's Christmas morning. The way you get to, you get to a place where you just have direct data connection. That data is flowing into that entity all the time. You get much more of a kind of rolling or every couple of weeks you're getting these results. I'm really comfortable with the process that we're moving through. I think ultimately we have a very clear vision about where we want to go.
We have a very clear vision of the value that we want to deliver to these CPGs. We're not just sitting in a room building this stuff and then there's going to be this grand reveal. We just keep taking it bit by bit out to market. We get great feedback and we execute on that.
Okay. Understood. Incumbent upon this though, and it's been a conversation the collective sell side including myself have had on the earnings calls, is that you also live somewhat at the whim of advertiser budget cycles. There are elements of product versus proving out the product versus cycles. Where are we in terms of the strategic shifts we're trying to implement against the usual cadence of sort of 6, 12, 18-month budget cycles, and how you're thinking about aligning product with budget cycles and where we are as another overlay on top of the transition?
Yeah, it's complex. I think that there's a couple of things. I've said this and I want to reiterate it. First and foremost, we have to be customer-obsessed. We really have to not be a service provider where someone says, "Hey, we're ready to execute some promotions. We'd like you to do it." We need to show those entities, independent of how they're working with us, that we're obsessed with them. That's the first thing. The second thing that we've learned is talking about this is great. Actually showing existing customers and future customers results in advance is actually better. How do we think about showing up to a meeting and saying, "Here's what's happened over the last year?" A lot of the first meetings that Bryan and I had, you'd get these vigorous head nods. This sounds great. Now show me. How do we do it?
How do we do it? That's an evolution for us. The other thing where we're evolving is this doesn't require you to sign up for some new contract with us or put some new amount of money. Of course, we'd love that. If you have existing programming with us, think about where we are today. We're about to go into quarter four. You've got a campaign that's ready to go. We're going to do everything we can to take that campaign and run it through this new bit. We want to prove as quickly as we possibly can that we're delivering, again, that demonstrable value to you. You're absolutely right that budget cycles, those are challenging. Purchasing funnels, who's making the purchase, that can be challenging. Gosh, I'd really love to buy this, but we already committed to this other thing.
What we need to do in this regard is just be in the right place and be really flexible to the customer. We are incredibly confident that we're going to deliver the value. We're seeing that in early days, being validated. I think that we will continue to make steady progress here. I hope we're going to end up in the place where brands will say that, yes, we do have a 12-month budgeting cycle, but this is delivering such clear value. We've got to find a way for you to get the money sooner.
Got it. You alluded to it earlier in one of your answers, talking about getting to a point where you have high confidence interval in revenue visibility. How does that also feed into it to the extent to which you take what we've talked about up to this point, the repositioning of the platform around where you want to go, the conversation you're going to build, the go-to-market strategy? Is the output greater levels of revenue visibility, revenue predictability? Is that how the way investors should think about it?
Yeah, I would like to be able to deliver that. I think there's a couple of key ingredients there. The first, again, being customer-obsessed. We need to understand. We need customers to say if something, sometimes things, you know, budgets fall out. I've been doing this for a while, and you never want to hear that we've had a change in our business. Having a customer tell you that is the first part of the battle. If you understand that, okay, let's reattack and we'll reframe and figure out if there's another way for us to provide value to you. That first thing is just being present with the customer. The second thing is really getting to the place of doing joint business plans. Very common in my old world, but this is what we endeavor to do this year.
The only way you can do that is by understanding what they're trying to accomplish, such that, again, you have that alignment. We've talked about whether it's the revenue operations team, the sales finance team, we're just surrounding the sales organization with more support, such that you have some quantitative inputs to go along with the qualitative inputs. That will help forecastability without a doubt. The last thing that I'll say is the more demonstrated value you provide to a customer, the more predictable the revenue gets. That is the thing that we are, that's why we're so focused here. We want to deliver value to the customer. We make money when they make money. When everybody's in this harmonious cycle, it gets much more easy to predict. I think it's harder when it's, you can be in this lumpy environment when it's unclear what the value is.
There's a lot of things that are at play there, but I think we've got the team in place to provide that for you.
Maybe just one more to close out this whole sort of broader theme. When you think about how the products you offer aren't priced and how the pricing actions of the company tie back to the sales motion of the company, maybe just close the loop on all of that as sort of the last point of the things that involve more in the transition than the external.
Sure. North Star revenue growth, not fee growth. You think about that. You could be in conflict there. You may want to raise fees. Maybe that's the right thing. My belief is that our number one goal and our number one job is to grow revenue, do that in a cost-effective way. To do that, we need to make sure that with our customers, we're understanding their margin profile, we're understanding what good looks like for them, and then we are giving them the ability to spend money with us in a way that is, again, profitable for them. If you think about how Bryan's been talking about this rollout that we're doing, we endeavor to say, if you want to be high, high, high margin, you can do that. You'll probably move less units, but we want to give you that control.
If you want to drive a lot of scale right now and you want to open up the aperture on cost, we can do that too. That is different than how we were doing pricing before. I think we're taking much more of a market-based and customer-centric pricing program. Price shouldn't be a blocker for us. That's something that shouldn't be a blocker. You may have a very low fee that may impact your volume ultimately, but that's something that's pretty standard in performance marketing.
Yeah, understood. Maybe pivoting some questions and we'll try to move through them quickly in the time we have. Maybe just thinking broadly, competition. One question we get asked a lot is how does the Ibotta Performance Network both interact with, but also compete with, retail media networks? The broader question would be, where do you see yourself fitting into the broader competitive landscape for a budget against that more sort of idiosyncratic question with respect to with or against our RMN?
For sure. The first thing that I'll say, take retail media out. Just take marketing budgets, full stop, end of story. We want to deliver proof, undeniable proof that we deliver contribution margin-positive revenue growth, full stop. I want anyone at a CPG to say, "Well, that looks interesting to me." I think that's of critical importance. As we see in the landscape today, being able to deliver outcomes makes a difference. That's the first thing I'll say. That's not competitive with anybody. That's just what we're going to do. As it relates to retail media networks, you're absolutely right. There has been a massive rise over the last 10 years to where it's a household word now, retail media network. I think about our solution as very complementary to the retail media network.
If you think about how we work with Walmart right now, you can be a brand, you can buy a sponsored search result. What does that do? That brings you to the top of the search result for toothpaste or for laundry care or for fabric, whatever it may be. You have the ability to augment that search result, that small product listing that you'll see there, with the Walmart Cash offer, which is powered by Ibotta. That is absolutely a perfect example of complementary service. That will make your search result stand out more. That will probably compel the user to click through to get some more information and hopefully to make a purchase at a higher level of frequency. That's what we see with our partners. We don't see it as either or.
We see it as an and because those brands should be buying retail media to drive discovery. They should be buying retail media to drive awareness. When you get into that consideration phase, retail media is also very important. That's when we can really start to add value. I'm encouraged by what we see with our partners like Instacart, like DoorDash, like Walmart. I think very complementary.
Okay. How should investors think about the pipeline or potential around new advertiser segments for the Ibotta Performance Network over the longer term?
Anything that's a packaged good, anything that exists at a Walmart, anything that you could get through a DoorDash on the grocery or mass merchant side, that's in play. I think for us right now, what you'll see is we've expanded over the last couple of years into general merchandise, seeing happy with how that's going. I think we also have a really massive opportunity just sitting in front of us with the CPGs. Plus or minus $200 billion spent in marketing from that cohort of customers. I think it's really important that we think about our resources and attacking the enterprise level and the emerging level effectively because there is just a lot of revenue there and there's a lot of revenue to be had. We're very interested in working our way to every single product that you could find inside of one of those stores.
Right now, there's a ton of opportunity for us just to get better at how we service that CPG. Doesn't mean we're going to stop serving general merchandise. Not at all. I just want to double-click on underscore the point that that CPG market is a big one.
Okay. Pretty much the conversation at this point had focused more on where you're going as a platform and a product, how you incent budget and conversations with advertisers. We only have a few minutes left. Maybe we'll end on a collection of questions about the redeemer or the consumer side of the equation. What do you see today in terms of the behavior of redeemers? How do you think about the opportunities to stimulate redeemer growth from here, both with some of your bigger partners like Walmart and store or across other canvases where you can engage with redeemers?
Yeah, okay. The American shopper today cares a lot about value. That's obvious. Everybody understands that. We're going into the holiday season right now, and there's a real challenge between how do I deliver value? Retailers are thinking about value versus discovery. How do I get this right at this time of year that is so critical to my business? First and foremost, the core thing that we do, we need to keep doing. We need to help manufacturers connect with shoppers such that those shoppers can find value and be compelled to make a purchase. That's the first thing that I think is really important. The second thing is, if you think about that, the Ibotta Performance Network in totality, as we've discussed, we reach 200 million shoppers. That's a very big number.
What we're going to do is keep working with our partners to find the right way to show up. Whether that's showing up in the sponsored search results, which we do at Walmart, or finding the right way to be included in traditional retail media network advertising, that's really important. I think it's also important for us to work with our partners. Working with the manufacturers to make sure that we get the right swath of offers and we get a broad enough swath of offers such that we can take that 200 million opportunity and keep expanding into that. That's where I see the sales team really delivering a lot of value. It's helping educate the marketer, the packaged goods company that, yeah, here's what you want to do. We're going to do that for you, but you also have an opportunity here to deliver profitable growth.
You may not have been thinking about that. There's an opportunity here to deliver profitable growth. As we demonstrate that we're delivering profitable growth, that will allow us to expand from ones to tens to twenties of offers from a company to 20 to 50 to hundreds of offers. I think that's what allows us to really increase that redeemer count because the total population of shoppers that we reach, it's tremendous.
Maybe just one quick follow-up before we run out of time. You know, we get asked a fair bit about how much of this activity will happen online versus potentially how much of this activity can happen in store. I know we've had this conversation on the public earnings calls about Walmart in store over time, but just broaden it out a little bit. How much you are sort of agnostic to where the redeemer's activity is relative to the market opportunity and whether there's a worldview inside the company about that.
I think we want to meet the shopper where they are, full stop, end of story. That's the thing that we have to do. If you look at the e-commerce growth in grocery and mass merchant sales, it's tremendous right now. If you look at what's expected in holiday shopping, it's the mobile device that is the key entry point for shoppers. That doesn't mean that there's not a lot of folks going in store. We want to be there for them. Ultimately, I think for us to be the best connector, you go back to where we started. You've got the shopper, you've got the manufacturer who's trying to provide value to the shopper, and you get the retailer who's helping them make that purchase. That's what we're trying to satisfy. We want to be a solution to each of those.
Therefore, whether it's testing in-store opportunity with Walmart, if it's testing different ways we can show up in a mobile experience or in a web experience, all of those are critically important. We want the shopper to have equal opportunity to redeem these offers to receive the value because that's good for everybody.
Okay. I think we're going to leave it there. We're just a minute or so to go. Chris, thanks for coming and having the conversation and a lot of exciting things that you're working on at Ibotta. Look forward to possibly having the conversation a year from now.
I hope we can.
All right.
Appreciate it.
Thanks, everybody.
Thank you.