The endstate of aggregator business models is retail media.

· Bits and Bobs 5/5/25
  • The endstate of aggregator business models is retail media.
    • "Retail media" is ads within the aggregator's 1P UX.
      • Step 1: capture all demand.
      • Step 2: offer to steer that demand to advertisers, for a price.
    • This business model has insane margins because the inventory is the aggregator's own inventory.
    • Small-scale aggregators like Instacart work this way–though a user might not really realize that they're seeing ads.
    • But also the largest scale aggregators mainly work this way, it's just that the ecosystem is so large and rich that it's more obvious they're ads.
    • Things like MCP and agents erode the aggregator business model; if the users eyeballs never land on the service, they can't be steered.
    • That implies that aggregators will resist being embedded in tools like MCP.

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