UPDATED: AOL Acquires Convertro for $101 Million
ADOTAS – Hours after Google announced it has acquired Adometry, AOL trumpeted its move to acquire Convertro for a closing purchase price of approximately $101 million. According to an AOL press release, the aggregate purchase price is comprised of approximately $89 million in cash funded at closing plus approximately $2 million in converted stock awards and a $10 million earn-out, payable over a period of up to 17 months subject to satisfaction of certain product development milestones.
Convertro is a leading provider of multi-touch attribution modeling technology for brands and agencies. It helps marketers and agencies maximize their return on advertising spend across online and offline media channels through granular insights into each channel, format, ad creative and audience segment.
The transaction comes on the heels of the recent announcement of ONE by AOL, a programmatic enterprise platform.
AOL officials said the addition of Convertro into AOL Platforms will enable marketers and agencies to:
- Plan, activate and optimize multi-channel media ad spend effectively, in real-time, across every channel and inventory source;
- Understand and repeat successful paths to conversion;
- Adapt creative and messaging to a consumer’s stage in the purchase funnel;
- Pinpoint the intersection of brand and direct response dollars at a granular level;
- Implement and derive insights from attribution modeling in real time at the individual consumer level; and
- Access AOL’s open, modular and unbiased platform which is committed to preserving the integrity of Convertro’s attribution modeling methodology.
“AOL is making advertising easier for marketers and agencies, as well as publishers,” said Tim Armstrong, Chairman and CEO, AOL. “Our agreement to acquire Convertro demonstrates our continued commitment to bring efficiency to the advertising industry through automation and machine learning. Our focus on the AOL Platforms business has positioned AOL for growth as the trend around programmatic advertising continues to transform the industry.”
“Convertro’s vision has always been to provide its clients visibility and recommendations on how their advertising investment works and how to improve that return on investment,” said Jeff Zwelling, CEO, Convertro. “We believe the future of attribution is applying this data to programmatic buying and automated analysis. Integrating with AOL is going to bring our leading technology into the hands of some of the world’s leading and biggest advertisers and we couldn’t be more excited!”
According to the press release, customers can garner access to Convertro one of three ways: through AdLearn Open Platform (AOP) or Adap.tv; as a standalone attribution modeling tool; or through ONE by AOL when launched, which will feature Convertro’s attribution modeling capabilities.
“Two heavyweights like Google and AOL entering this market only confirms that advertisers want, and need, to understand the influences on the customer journey,” said Jeff McCollum, president of CAKE, a company that tracks online campaigns for customers such as Home Depot, LegalZoom, LendingTree, eHarmony, Alaska Airlines, the UK2 Group, Experian, etc. “No longer viewed as a passing trend, attribution is something that marketers will be held accountable for and will soon be required to measure. Now the question is, who will begin to look further upstream to provide the insights to the actual cost, and further downstream to revenue associated with the journey?”
“Prior to 1990 you could smoke on planes,” added Andrew Bloom, SVP Corporate & Business Development, Sizmek. “For those of us old enough to remember — and even for those who are not — the idea seems preposterous, rude and just plain wrong. Prior to May 6, 2014, the day Convertro and Adometry were bought by two of the largest publishers in the world, digital advertising was dominated by a mindset that when determining which advertising channel drove success, last click or last view was the winner. For those of us in the business of providing advertising solutions to reach the ever more elusive consumer, we know that for sophisticated multi channel advertisers, last click attribution falls into the category of things we now know to be wrong – as allowing someone to smoke on a plane also was. The acquisition of Convertro and Adometry –- two great companies driving leadership in algorithmic attribution — is great news for all of us committed to help advertisers truly understand the inter-relationships between all consumer touch points. For me, the most interesting aspect of these acquisitions is who the acquirers are; both are media companies, and one in particular, Google, has built its fortune from search and last click attribution. At the end of the day, attribution is a tool set that helps advertisers and their agencies understand which media types are driving value. And at Sizmek we believe that that capability should exist independently of media to avoid any conflicts. It will be interesting to see how agencies and advertisers react to these new homes.”
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