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Snap buys Placed for deeper insights into offline behavior

Placed will remain an independent company, keeping its headquarters in Seattle

Financial trends and news by Steven Loeb
June 6, 2017
Short URL: http://vator.tv/n/49aa

We tend to think of online and offline advertising as two separate things, but the reality is that they are intertwined and feed off each other. Online ads are not only designed to get you into a digital shopping cart, but into a brick and mortar store. Getting this to work, though is a problem that the advertising ecosystem has been working toward solving for a long time.

Snap, a company which relies almost entirely on advertising for its revenue, understands this. That's why, earlier this year, it launched Snap to Store, which measures Snapchatter foot traffic to physical locations following an ad campaign on the platform.

Now the company is digging in even deeper on that front with the acquisition of Placed, a location-driven insights and mobile ad intelligence platform providing reports on consumers’ offline behaviors. The purchase was revealed in a blog post from David Shim, the founder and CEO of Placed.

No financial terms of the deal were disclosed, though Geekwire, who was the first to report this news, pegs it at $200 million. Snap would not confirm that number.

Founded in 2011, Placed says that it "provides clients the most complete understanding of what consumers do in the physical world – and turns that information into actionable insights."

That means the company offers placed attribution, quantifying the impact of ads on in-store visits, and providing metrics to evaluate the offline impact of ad dollars. It also allows for placed targeting, with what it calls "the industry’s first lookalike model for location-based advertising," as well as insights into offline consumer behavior and competitive trends.

In the past year, Placed "measured over $500 million in media spend to store visits, across thousands of campaigns and hundreds of partners," Shim wrote. By becoming part of Snap, he said, the company can "do even more."

"Placed’s goal continues to be the adoption of a common yardstick that can measure the offline effectiveness of advertising across multiple platforms and publishers."

Going forward, Placed, which has over 100 employees, will operate independently from Snap, keeping its headquarters in Seattle, and its offices in New York and Los Angeles. Employees will continue to report to Shim, who will, in turn, report to Imran Khan, Snap’s Chief Strategy Officer.

To ensure that Placed is able to remain independent as its measures cross-platform campaigns, Snap is putting in place strict data-sharing, privacy and security guidelines to ensure a technical and physical separation of advertiser data between the two companies, a spokesperson for Snap told me.

Placed had raised $13.4 million in funding from Madrona Venture Group, Shane Atchison and Two Sigma Ventures.

Snap acquired Placed to continue to scale its measurement business and embrace location measurement for mobile, the company told me. The deal will improve upon some of its own first-party offerings, such as Snap to Store, by allowing advertisers to measure impact across multiple platforms.

Improving advertising capabilities is important for Snap, as that is currently its main source of revenue. In Q1, Snap saw $150 million in revenue in Q1. Snap sold revenue was $129 million, or approximately 86 percent of total revenues. Partner sold revenue was $12.3 million and other revenues were $8.3 million, primarily driven by Spectacles.

With this acquisition, advertisers will continue to be able to leverage Snap to Store to gain insight into their Snapchat campaigns, and Placed will allow advertisers to measure effectiveness for cross-platform campaigns, including Snap.

The Snap community currently visits the app more than 18 times per day and spends over 30 minutes using it daily. Snaps overlaid with Geofilters are viewed over 1 billion times a day. Research has also shown that 80 percent of its community has used Snapchat at a restaurant, 66 percent at a shopping mall, and 50 percent at a gym.

(Image source: placed.com)


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