Good morning, everyone. Thank you for joining us at such short notice for this call. I'm Alessandra Girolami, and I'm here with Thibault Hennion, who's the Managing Director of International Operations at Epsilon. We thought it would be useful for you to have some context on the retail media joint venture we've announced this morning with Carrefour. Thibault will do a short introduction, accompanied by a few slides that you probably have received by now. You'll be able then to ask your questions. The idea is to focus on operations and strategy and finish the call by 9:00 A.M. CET. You'll find, of course, all the disclaimer notices in the slide deck. Thibault, over to you. Thank you so much, Alessandra. Welcome everyone. Thank you so much for joining this call in this short notice. Let me start with a very brief snapshot of retail media. Then I will move into the principle of the partnership that we just announced with Carrefour this morning. Why is retail media booming today, and what is the key value that it is bringing both to brands and to retailers? For brands, retail media is really delivering on the promise that they have been looking for years, providing them direct access to customers, both in the retailer environment, would it be in-store or on their e-commerce footprint. Also leveraging the retailer data to be able to talk to customers outside of the retailer premise. For example, in the publisher inventories. This is providing extremely high conversion rates among the highest ROIs on the market. This is particularly important in the current context, a totally brand safe environment because we are speaking to the retailer within a known environment, the retailer inventories. All of that is also providing transparent measurements that is backed directly by merchant transaction. Advertisers can see the direct effect of their marketing action directly tied into sales. For retailers, retail media is providing high-margin revenue. It is an opportunity for them to accelerate their e-commerce footprint and their e-commerce sales. From a more strategic standpoint, it offers them the opportunity to reshape the relationship with their supplier, allowing them to have a different discussion about value and performance. This is not a coincidence if the global retail media market is now estimated around EUR 100 billion media spend, reshaping media hierarchies. What we are seeing from various industry reports is that the retail media spend will overcome traditional TV spend in the next few years around geographies, probably as soon as 2024 or 2025 in the U.S. A bit later in other geographies. What we are seeing is that retail media is already mature in the U.S. and also to a lesser extent in the U.K., still fragmented and largely untapped in Europe and in Latin America. Let's deep dive for a couple of minutes around this geographical view. It's true that outside of the U.S., there are different challenges that retailers and brands need to address together to be able to leverage the full potential of retail media. There is first a lower e-commerce penetration. We know that retail media is directly correlated to the overall size of the e-commerce business of the largest retailers. We are speaking about fragmented geographies with different regulations, different countries, different language, and all of that are creating barriers for brands to spend their media EUR. Finally, the landscape, the business retail landscape is diverse and relatively fragmented, providing less scale when a brand would like to leverage their media spend to reach their customer and to send their overall marketing spend into the retailer environment. Still, despite those challenges, we are seeing the same growth potential for retail media in continental Europe and in LATAM. First, retailers are having extremely strong loyalty program where data is gathered in a fully GDPR-compliant way, and this is providing extremely valuable data for retailers to help brands within their marketing programs. We are also seeing the same trends as in the U.S. or in the U.K., and we can anticipate that retail media spend will be as large as TV spend by 2026, maybe potentially 2027 in Europe. Definitely seeing the same trend and the same dynamic, disrupting the traditional media hierarchies in other geographies. Finally, when we are speaking about the total addressable market, what we are seeing in various industry reports is that the overall retail media market is anticipated at EUR 25 billion in Europe by 2026. If we look at the directly addressable market for players like Publicis or Carrefour in continental Europe, so outside of Amazon and the U.K., we are speaking about a directly addressable market at EUR 5 billion. There are two very interesting study that I can only recommend you to read about the status of retail media in Europe versus the U.S. One that has been published by the IAB Europe in over the last few weeks, and the other one that has been published by McKinsey in July 2022. Now, when it comes to Publicis Groupe and their retail media arm, CitrusAd, powered by Epsilon, we are benefiting from a leadership position in retail media in the U.S. and in the U.K. We are working with the largest retailer in those geographies, and we can see every day the recipe that has been successful in making the overall retail media market boom in those geographies. We know how to talk to brands when we are speaking on behalf of retailers to give them the necessary connectivity, the necessary scale, and the necessary internal transformation to bring retail media at its full potential. This has been one of the key drivers of the partnership that we are announcing today with Carrefour. We will be creating a joint venture at 49% for Publicis Groupe and 51% for Carrefour, where we will join forces and bring our combined strengths to address the booming retail media market and accelerate its development in continental Europe and in Europe. On our side, within Publicis Groupe, we have announced the industry's first on-site, off-site retail media platform at the beginning of the summer, CitrusAd, powered by Epsilon. We have seen very significant momentum over the last few weeks, you might have seen the various release of retailers adopting our technologies across the world. On top of that, this platform is fueled by an industry-leading identity solution, the one provided by Epsilon, the Epsilon CORE ID. Overall, it's more than 300 million CORE ID globally and more than 80 million in Europe that will be able to fuel the platform and to continue to expand thanks to all of the retailer data that we will be able to leverage, thanks to our retail media inventories. Finally, we are providing industry-leading clean room technology that are allowing retailers and brands to share their first-party data in a totally compliant way to be able to build more efficient marketing plans and marketing strategies. On the Carrefour side, they have developed their retail media activity extremely early, they have taken a leadership position in continental Europe and in LATAM in this field. With Carrefour Links, they are bringing their first-party data above 80 million household customers, all of their transaction data and their premium inventories to allow us, together, to bring the retail media market in those geographies to the next level. What we would like to deliver is to bring to retailers the same level of scale and the same level of connectivity to bring the retail media market as close as possible to its scale in the U.S. or in the U.K. We knew that to be able to deliver so, we needed this disruptive action to be able to bring the market together and really deliver scale to those players that are suffering from this fragmented landscape today. To summarize our presentation, we will be bringing together two unparalleled assets, the scale of Carrefour in continental Europe, Brazil, and Argentina, with the Publicis Groupe leadership position in the most retail media market, essentially the U.S. and the U.K. Together, we will be creating a joint venture that will be covering the entire retail media value chain, technology for inventory creation and data sharing from merchants. This is on the retailer side, as well as commercialization of media and data solutions for brands. This is on the advertiser side. We will have, thanks to our unique technology, CitrusAd, powered by Epsilon, an integrated tech stack that will bring together the on-site, the off-site, and the clean room technology to deliver a single data asset and allow retailers to leverage their retail media potential at full potential. Finally, we have the ambition to rally multiple retailers in the midterm to create the necessary scale effect and connectivity, creating a network of inventories that will ease the media spend for brand. This is something that we are already delivering in the U.S. today, that we would like to replicate with the same success in those geographies that are more fragmented today. Alessandra, I'm done with the presentation, I am now available to take all of your questions. Operator, we can now launch the questions. Excuse me. This is the conference operator. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Tom Singlehurst with Citi. Please go ahead. Thank you very much for the presentation, and thank you for doing the call. Tom here from Citi. Apologize because I missed the very beginning of the call, so I do apologize about that in case you covered this. Two questions. The first one, high level for the retail media opportunity. Can you talk about how additive it is? It's obviously a very big market, a very fast-growing one, but is this spend that historically was not addressed by, in particular, Publicis and the ad agencies more broadly? That's the first question. The second question, very briefly, just to check whether the creation of the JV involves any significant capital outlay for the group. Those are my two questions. Thank you, and apologies if you mentioned this right at the beginning of the call. Hi, Tom. Thanks for your questions. I'll start with the second one. Basically, in terms of what Publicis brings to the JV, Publicis brings the exclusivity of the technology of CitrusAd and the CORE ID and the clean room to the JV commercialized in Carrefour geographies. On top of that, Publicis will also invest around EUR 25 million in the JV in order to achieve a balanced shareholding with Carrefour. On my side, I will take the first one about the retail media opportunity, whether it's additive or whether it's replacing some more traditional spend. What we are seeing is that when you look at the potential growth of retail media, you have between one-third and two-thirds, that is net new investment, that is not coming from an old channel, replaced now by retail media. There are relatively good strategic reasons for that. Historically, retail media was really a performance media tool, where brands were spending in the channel that is the closest to the purchasing action. Now more and more brands are using it also to deliver on their brand-building task and their overall awareness duties, particularly on the publisher environment. It's true that you have a portion of retail media spend that are replacing, essentially, traditional trade spend. More and more, as we are seeing with the overall digital media spend, retail media is also creating its own channel and its own additional value because the potential of retail media is largely untapped today. It's still at a majority performance media tool, but we are seeing more and more awareness and brand-building channel that are used more and more, would it be on the retailer website or on the publisher website, but in both cases, backed by retailer transaction when it comes to measurement. This ability to tie every marketing action into sales performance or into direct transaction is something relatively new that advertisers really like and really love because it's providing justification for their marketing spend and the ability to demonstrate that every single marketing dollar is used for the right purposes. That's very clear. Thank you very much. The next question is from Adrien de Saint-Hilaire with Bank of America. Please go ahead. Yes, good morning, everyone. Hopefully you can hear me okay. Thanks for the presentation indeed. Couple of questions, please. Thibault, I think you mentioned before at the Viva Technology conference that CitrusAd was growing above 100%. Do you mind reminding us what the revenue base for CitrusAd is right now? Secondly, Alessandra, you mentioned exclusivity of technology. Just to be clear, does that mean that CitrusAd won't be able to serve the retail media networks of other e-commerce platforms going forwards, or did I misunderstand that point? I'll take the first question. I will let you the second, Alessandra. We haven't disclosed the basis of the revenue for CitrusAd in the past. Now you have some indication about the transaction price last year for the acquisition. I guess you have in mind the magnitude of the multiple for such an acquisition. You can probably build the top-line revenue or at least some bracket for the top-line revenue. It's true that CitrusAd is experiencing a very significant growth this year, three-digit growth, so above 100%. We are seeing fantastic momentum with our platform. We converted one of the largest grocery retailer in the U.S. a couple of weeks ago with Ahold. We are now announcing the conversion of Carrefour. This is just the beginning. We are definitely seeing a very significant momentum with our retail media activity and our unified platform, CitrusAd, powered by Epsilon. Alessandra, on to the next. Sure. The way it works, Adrien, is that CitrusAd and Epsilon will be the exclusive tech and product provider of the JV, hence generating net revenue for Publicis from January 2024 with Carrefour, as soon as the JV is created with other retailers. In short, the way you have to see it is that the JV will be one of the largest clients of Epsilon and CitrusAd outside of the U.S. I hope that's clear. The JV will play as a reseller of the CitrusAd and Epsilon technology in Continental Europe and in LATAM. Yeah, got it. Thank you. The next question is from Julien Roch with Barclays. Please go ahead. Yes, good morning. Thank you for the call and taking my questions. The first one is retail media. You put a few numbers in the press release, EUR 100 billion globally, EUR 25 billion in Continental Europe and EUR 5 billion directly addressable. Do you have a sense of how much will it be in Carrefour geographies? That's the first question. The second one is on financials. Will the JV, because you only own 49%, will it be consolidated or only at associates? And how will the JV generate revenue? Will you get a percentage of the spend on Carrefour platform, or is it like a fixed tech fee or a variable tech fee? That's my second question. Then the third one, coming back on the exclusivity question. The JV is the exclusive tech provider, but does that mean that in Carrefour geography, France and LATAM, CitrusAd cannot sell their technology to other people? What do you mean by exclusivity, just to be 100% clear? These are my three questions. Thank you. I'll try to take the three question, and Alessandra, if you want to add anything, please feel free. On the first question on the addressable market. If you look at the latest IAB Europe study, the total retail media market in Europe, including the U.K., is expected to reach EUR 25 billion by 2026. This includes the U.K. and Amazon, and it's true that today Amazon is the largest retail media player in those geographies. I think in the same study, they are computing that Amazon is grabbing 80% of the retail media market in those geographies today. By the way, this is a key driver for this initiative because what we are telling those retailers is that it's time to join forces to take their fair share of the retail media market and overcome the fragmentation that hold them back a bit in their overall retail media activity. In Carrefour geographies, and actually the scope that we are highlighting is a bit larger than just the Carrefour geographies. It's really continental Europe plus Brazil, plus Argentina. What we are anticipating is that the addressable market for these territories, which will be the territories of the JV, is the directly addressable market, is EUR 5 billion by 2026. Basically, this is the share that is expected to be generated by all of the retailers outside of Amazon. This is for us the right comparison basis when we are making our assumption because this is the market that we would like to conquer. On the second question on the financial flow and the fee structure, the JV will really play as the reseller of our technology, CitrusAd, powered by Epsilon. If the JV is converting a specific retailer, we will act as the technological provider of the JV and ultimately the retailer that has been converted. This is the way that CitrusAd and Epsilon will be compensated or rewarded for their work. From a pure Epsilon and CitrusAd point of view, you can consider the JV as one client that will bring multiple retailers with the normal fee structure or the traditional fee structure that we are having with a client. The structure in this sense is relatively similar to what we did with Sapient and Techics, at the beginning of the year, I guess? Yes, in 2024. In the APAC market. I hope this is also answering your third question. Basically what this means is that now the JV will be the selling arm or the commercial arm for our technology in continental Europe. So basically a European Union outside of the U.K. plus Brazil and plus LATAM. The idea is to rally multiple retailers to create a network of inventories that will bring the necessary scale and connectivity to retailers. This is, by the way, this kind of network of inventory. This is what we are delivering already in the U.S. with some retailers, and that has proved to be extremely successful to bring them the right bargaining power, scale, connectivity, processes, and consistency when they are talking to brands. Overall, this is accelerating extremely significantly their retail media journey. Does that answer all of your question, Julien? Yes. [Foreign language] Super. The next question is from [Lena Geier] with BNP Paribas. Please go ahead. Hi. Hi, Alessandra, Thibault. I hope you can hear me well. I have three on my side. The first one is, will you be able to collect the data from those European and Latin American markets to fuel your CORE ID in those regions, given that you made an acquisition recently there, I think with CitrusAd? The second one is just to come back on Julien's point around the platform. You say you wish to attract more retailers. Can you just talk about your ambitions here from timeline, and also can you confirm you intend to not create one platform for each retailer, but that you intend to scale this platform, and potentially bringing on more retailers? Lastly, if yes, could you just compare a bit what you are offering with typically Criteo right now? Thank you. Okay. On the first one, on the way we are onboarding data, and the way we are leveraging data for our retailer clients. The Epsilon and the CitrusAd, powered by Epsilon technology will be and is the technology of choice of the JV. When we are working for a retailer, we will be going through the normal onboarding process for its data to fuel its full retail media activity and to bring its retail media activity at full potential. This is exactly what we presented in VivaTech a couple of months ago. When we are able to learn from the existing customer base from a retailer to make its overall retail media activity more powerful, would it be within the retailer premise, its e-commerce website, or within the publisher premise, thanks to our offsite offering. The traditional way to onboard data from Epsilon will be the normal technological choice of the JV because our technology will be the technology of choice of the JV. On your second question, on whether it's one platform or multiple platform, it's actually a choice of each of our clients, either to have a specific instance within their platform where brands can connect directly and spend their marketing dollar on this retailer directly. Some retailers are also choosing to join forces and to create a network of inventories. The platform is exactly the same, the interface is exactly the same, except that when you are a brand, you have the choice, once you have entered the platform, to spend your marketing dollar into a network of retailers with consolidated reporting, consolidated performance, and the ability to get immediate scale when you are considering your retail media investment. This is, by the way, what we are doing already in the U.S. There is a specific inventory network that is called GroceryOne. We issued a press release about it, I guess it was in June, that is explaining exactly the principle. The idea is really for multiple retailers to join forces to get immediate scale connectivity and consistency in their retail media activity. Overall, it's demonstrating a very significant acceleration in the brand spend on those premises. Finally, in terms of comparison with the competition, with this JV, our ambition is really to create a full media player that is delivering, first, a technology to be able to equip retailers and make sure that they can benefit from the best technology. Also, this is thanks to the CitrusAd expertise, but also, the Carrefour expertise from their Carrefour Links journey, the right consulting mechanism to help retailers make the necessary internal transformation and internal changes to leverage the full potential of their retail media activity to articulate the best way possible to talk to brands, ultimately to sell the inventories in the best possible way. This is something that Citrus was not doing in Europe and in LATAM today. This is a net new addition into the overall value proposition, providing the ability on top of the technology to provide advising services or consulting services and the sales activity of the inventories to come with a full media offering, with media inventories, with data, providing an on-the-shelf offering to advertisers. Maybe I would just complement on the timeline- Yeah. -question, Lina. The joint venture is expected to be finalized in the first half of 2023. Carrefour will implement CitrusAd and Epsilon products and solutions from 2024. The next question is from Jérôme Bodin with Oddo. Please go ahead. Yes. Good morning. Just a quick two follow-up on my side. The first one, could you maybe give us a bit more details on the governance, which is planned? It is maybe a bit too early, but who is going to be in charge, CEO and board, between yourself and Carrefour? That is the first one. The second one, you mentioned the fact that you want to work with other retailers. Just to try to understand, how do you plan to convince them, and could you maybe open the capital structure to new partners? Thank you. I will take the second question, then I will let Alessandra answer the first one. Yes, the ambition is definitely to rally multiple retailers, either as a client or as a shareholder. The idea is really to work on an open environment. The value proposition that we are pushing to retailers is the ability to provide to them scale, connectivity, and consistency when they are talking to brands to really bring together a retail media ecosystem that is fostering the brand spend. This is really what is lacking in Europe today. This is also explaining why Amazon is getting such a significant market share above 80% today. Our ambition is to tell retailers that they need to join forces if they want to take their fair share of retail media and accelerate the development of the market for this market to come as close as possible to what we are seeing in the U.S. or to a lesser extent in the U.K. This is really the value proposition that we will bring together to other retailers with an open environment mindset, both in terms of commercial structure, but also in terms of shareholding structure. Alessandra? On the management of the JV, the CEO and the management team will be appointed later, once the company is effectively created. Similarly for the governance and for the shareholding, the board, I would say, will be structured to be aligned with Publicis and Carrefour equity stake. It's a bit early at this point in time to give you more details than that. We are expecting to create formally the JV in the first half of 2023. Of course, there will be additional announcement to come with the name, the management team, its first commercial success, et cetera, coming at the same time. The next question is from Sarah Simon with Berenberg. Please go ahead. Yes. Hi, I've got a few questions. First one, can you just remind us, I know you have a Publicis Sapient deal with Carrefour for the e-commerce, but are you responsible for the media buying as well? Is this kind of a logical extension of that? Second question was, it's kind of interesting that you've made Carrefour the majority shareholder. Do you not think that having a retailer being theoretically in control of the JV might put off competing retailers from joining the network? I take your point about retailers joining forces, but retailers are all fighting tooth and nail as well. Sorry, I've got four actually. I missed the answer on how you're going to account for this. Is this just going to go into the associate line, i.e., is the CitrusAd revenue in Europe and LATAM now going to go below the line? The fourth one was, do you have any trade marketing activities now in terms of recognizing revenues from Unilever paying Ahold or Albertsons for the best spot on particular shelves in the supermarkets? Thanks. Hi, Sarah. I'll take the question on the remuneration, in fact. You have to consider that there are two things, two flows, if I may. The first one is the revenue that CitrusAd and Epsilon will generate by being the exclusive tech and product provider to the JV. We're going to get revenue out of that. This will go in our net revenue line. As if the joint venture is our client or will be our client. You're right. Okay That secondly, because we own the 49% stake, Publicis will also be receiving a share profit in terms of associate. If that JV signs other retailers, that would be booked in your associate income? I would say that the primary source of revenue will be really the revenue that is generated as Epsilon and CitrusAd will provide the technology to the JV. Okay. If another retailer signs to the JV. We're going to be providing the technology. Fee to the bank. Okay. The JV is really acting as a reseller of our tech in those geographies. Okay. As working for a normal reseller, every time they are selling something, we are getting the majority of the revenue for it because we are delivering the work. The end relationship is at the JV level. Okay. I'll try to answer your three other question. On the first one, on the values, duties, and piece of work that Publicis is today delivering with Carrefour, we are not their agency of record for their media activity. It's true that Sapient has performed very significant transformation work in the past, particularly in reshaping their e-commerce activity and redesigning their website. I guess this partnership was announced in 2018, and their new overall e-commerce environment has been successfully launched. I guess it was around 2020. I'm not in all of the detail of this partnership between Sapient and Carrefour because on this one it's really geared toward retail media and our ad tech platform, CitrusAd, powered by Epsilon. You're totally right that in the past, Sapient has held significant strategic projects for Carrefour. On your second question, on having a retailer as a majority stake, I guess there is one piece to keep in mind, is the fact that Carrefour launched their retail media activity quite early and has been extremely successful in this field. They are one of the most advanced retailer in retail media in continental Europe as well as in LATAM. Our ambition is to bring other retailers through the same journey to accelerate their path to revenue and to bring them the same success learning from the Carrefour experience. At the beginning, we thought that it was the right sharing structure, as I mentioned previously, this sharing structure is also expected to evolve in the future as other retailer potentially as well will join to really bring the successful ecosystem that is needed on retail media in those geographies. Finally, on your question on trade marketing. Actually the trade marketing landscape is an extremely interesting landscape that is very fragmented. It's true in the U.S., but it's also true in Europe or in other geographies because it's very different from a traditional media AOR where everything is centralized at HQ level. The trade marketing is really managed at sometimes regional level, sometimes even at a store level for brands. It's having a consolidated view of all of the trade marketing activity for a specific advertiser is something quite challenging. We are, by definition, holding some of these budgets. Some others are managed in a different way, but it's difficult to provide a totally consolidated landscape and view of the trade marketing budget because this trade activity as a whole is really evolving extremely fast. Some of it will remain at the store or at the regional level. Some of it will evolve in a more mature or innovative retail media spend. This is, by the way, also what we are seeing and what is fueling the retail media growth today. The trade marketing activity as a whole, there are some very different rules that is applying to the trade marketing activities than on to additional media or even retail media. If it's very regional and fragmented like that, I guess Publicis as a group doesn't do very much in the field of trade marketing today. We are at very regional level. In general, it really depends, advertiser by. Okay It is not managed through a large HQ-led AOR as the normal media or digital, or even retail media spends. Okay. Cool. Thanks. I think we're going to take one last question. The last question is from Christophe Cherblanc with Societe Generale. Please go ahead. Yes, good morning. Just wanted to come back on the Criteo question. I am not sure I got it clearly. My understanding was that Carrefour had a three-year agreement with Criteo. Does it mean that they will drop Criteo as a tech provider as of next year? The same question applies to LiveRamp, which is also a tech partner for Carrefour. Beyond Criteo, what do you see as the potential competition for the EUR 5 billion of addressable market you were mentioning? I can see your joint venture, I can see Criteo, I see Microsoft as a small business. Beyond that, what will be the next competition, and would you expect other agency try to build an offer in the space? Thank you. To answer your first question, yes, CitrusAd, powered by Epsilon, will become the technology of choice of Carrefour, but also of the JV as soon as the 1st of January 2024. We will be powering all of the Carrefour inventories from this date. When it comes to the clean room technology, Epsilon also hold some clean room technology, but this will come at a later stage because they have an existing agreement with LiveRamp that is quite successful. On your second question about the addressable market and the potential competition. What we are seeing in those geographies is that actually the first barrier or the first competitor is the fragmentation of the market. It's not directly a real competitor, but this is really what is holding back retail media in those geographies. This is what has triggered this initiative to accelerate the development of retail media in those territories. Another way to say it is that the main competitor or the player that is grabbing the most significant share of the market today is Amazon. That's for sure a fact. The IAB study that I mentioned in the past is clearly outlining that between 80%-85% of the market is getting to Amazon today. This is why we think it's time for retailers to act. Finally, from a more strategic perspective, there is also, it's always the case in the U.S. or even in the U.K., there is also the ability for retailers to build their own tech stack. To bring something on-premise that is not relying on a leading ad tech player. This is something that we are seeing with some players in the U.S. Some retailers in Europe have tried to do so. It will probably be more difficult for them looking at the fragmentation of the market and their difficulty to address brands directly because brands are looking for scale, for connectivity, and potentially even more importantly, for consistency across all of their retail media spend. By definition, it's true in retail media as it's true in media or in digital media, in-housing or the ability for players to build their own stack is always a potential competition. Thank you. Thank you. Thank you, Christophe. I think it's time to close the call. Thank you to everyone for having been present with us, especially at such short notice, and of course, talk to you soon. Thank you. Bye-bye. Thank you, everyone. Bye-bye.