Delhi-based online marketplace Shopclues has held preliminary discussions to acquire advertising technology provider Komli Media as e-commerce companies look to grab a share of the Rs 3,575-crore digital ad pie. The companies are yet to arrive at a figure for the deal, sources privy to the development told FE.
“We will look at acquisitions, but to build the ecosystem. We are not going to do a category acquisition. We might look at a pay0ment solution, a wallet solution, customisation and personalisation etc,” Radhika Aggarwal, co-founder and chief marketing officer, Shopclues, told FE. But Shopclues did not want to comment on the negotations with Komli Media.
Mumbai-headquartered Komli Media, which was founded in 2006, has so far raised $97 million from investors like Nexus Venture Partners, Helion Venture Partners, Peepul Capital LLC, Norwest Venture Partners and Draper Fisher Jurvetson. The company deals in solutions across display, mobile, social, and video for marketers, agencies and publishers.
Flipkart has already acquired mobile advertisement technology provider AdIQuity to ramp up its advertising business. The drive is being spearheaded by CEO Sachin Bansal, who will now reportedly focus on building new initiatives than oversee day-to-day functions at the company. Besides, Snapdeal, which is also reportedly in the fray for Komli Media, is betting big on ads. With over 25 million registered users at present, Snapdeal launched Jump Ahead, an advertising platform, in May last year and roped in marquee advertisers like Airtel, Microsoft, L’Oreal and VISA, among others.
Price comparison portal Junglee has also jumped on to the ad bandwagon. The company is piloting an advertising platform for sellers listed with it, before testing the waters.
Shopclues, which raised $100 million at a valuation of about $400 million from Tiger Global Management, Helion Venture Partners and Nexus Venture Partners in January, is also looking at ancillary avenues to boost revenues as it looks to turn profitable by the end of 2016 and opt for a public listing in the US in 2017.
Shopclues has been exploring both transactional and non-transactional revenue models for some time. Apart from charging a selling fee to merchants and a commission on every product sold, Shopclues has been working on advertising revenues, search monetisation and platform monetisation, wherein a seller needs to pay for value-added services like invoicing and merchant marketing programmes. The advertisement programme was launched about eight months ago where merchants can buy space on the Shopclues portal to promote their products.
With the number of sellers and brands on their platforms rising, e-tailers are working towards monetising the uptick in demand. They plan to charge the sellers and brands for special displays on the storefront and home page, besides an additional charge for search optimisation where a seller can pay an additional fee to figure among the top display results for a particular category.