Content recommendation company Taboola is moving into e-commerce with its acquisition of retail-focused platform Connexity in a deal worth roughly $800 million. The buy gives Taboola access to Connexity’s technology, which specializes in attracting customers to retailers like Walmart, Macy’s and eBay through advertising on publishers like Vox Media and Hearst.
“We’re getting into a completely new industry where we can find scale with a vision and team in place,” says Adam Singolda, founder and CEO of Taboola. “I’ve always thought e-commerce is the next evolution in imagining what the web will be like.” The deal, which remains subject to regulatory approval, will see Taboola purchase Connexity from Symphony Technology Group and is set to close in the third quarter of 2021.
Singolda says that Taboola and Connexity can now give publishers both audience insights and additional revenue, driven by users clicking on links to related articles and now to products sold by retailers. This includes contextual advertising, for instance showing Bluetooth products next to a news article covering next-generation Bluetooth, he says. “We can tell publishers what your users are interested in, and when they write about it, they can connect along that content and surface relevant products people might like,” says Singolda.
The move comes as the lines between retailers, ad tech platforms and publishers continues to blur. In June, Ad Age reported on Walmart’s move into selling data and analytics to brands, and major retailers like Amazon have their own live shopping video streams, in addition to both companies’ well-known in-house programmatic ad platforms.
It helps that Taboola might also be in a spending mood. The company, possibly best known for its content recommendation links on news websites, recently went public last month through a special purpose acquisition company, or SPAC, where a shell company set up by investors “acquires” a company looking to come to market. The debut reportedly raised $526 million, according to CNBC. Taboola’s recent buy could indicate where the company is looking to put that money to work.
The investor appetite around ad tech companies remains strong, fueled by the performance of companies like The Trade Desk and PubMatic, and has led to a long string of companies coming to market over the last few months, including Integral Ad Science, Zeta Global, and Innovid.