Taboola Targets Ecommerce and Affiliate With $ 800 Million Deal for Connexity

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Taboola has had a busy month. Three weeks after the company began trading on the Nasdaq, it acquired trade-based ad technology company Connexity for $ 800 million on Friday.

Connexity is a logical and attractive takeover target.

Taboola places recommendation boxes on publisher sites to connect visitors with advertisers and other publishers. Connectedness is also embedded in the seller side. It connects visitors to publisher websites with merchants and retailers, with an affiliate link business – Connexity acquired affiliate marketing company Skimlinks last year – and through its owned and operated price comparison sites. and other shopping sites, such as PriceGrabber.com and Shopzilla.com.

There is some overlap between Connexity’s 6,000 publisher clients and Taboola’s 9,000 publishers. But Connexity’s list of retail partners, including Macy’s, eBay and Walmart, and a stable of small traders, is a neat new addition to Taboola, CEO Adam Singolda said.

When Taboola finalizes the acquisition and integrates the back-end between the two companies, the product SKUs (“inventory management units”, the retail jargon of an individual product) of Connexity’s retail customers may be targeted. to the Taboola recommendation links. Think: an advertisement for an individual product in the Taboola recommendation area. This additional demand will improve the performance of Taboola publishers, Singolda said.

It is important to note that income from these ads will be business income and not advertising, as it is paid on a transaction basis, not clicks. Growing commerce-based revenue is a long-term priority for many online publishers, so adding these links will boost commerce growth.

Additionally, the two companies can cross-sell and up-sell, Singolda said.

Taboola plans to get publishers to embrace Connexity by saying it will work hand-in-hand on a commercial content strategy and a revenue diversification plan.

“I think every digital publisher will have a commercial section on the site,” Singolda said. The addition of Connexity will place Taboola in the emerging business sections of publishers, integrating its technology just as Taboola has been integrated into web content pages.

Taboola and Connexity also need to consolidate as walled gardens increasingly control web monetization, and there is less data available to third-party tech companies outside of those walled gardens.

Last year, Connexity shut down its Hitwise web analytics business because it could no longer obtain cross-site tracking data. Also last year, Amazon removed third-party affiliate providers from its commission program, so Skimlinks, the affiliate network acquired by Connexity, no longer receives a reduction in the traffic it sends to Amazon (that is, that is, it no longer sends traffic to Amazon.).

“Amazon has millions of merchants, but the merchants primarily have Amazon,” Singolda said.

If walled gardens build their bridges, it is up to independent ad technology and e-commerce companies operating on the open web to build a stronger, consolidated network that encompasses users, publishers and marketers in order to compete.

“Virtually all brands will continue to have a storefront with Amazon,” he said. “We need to bring these e-commerce capabilities to the open web. “


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