Following its spring acquisition of recommendations engine Avail, ecommerce personalization and shopping media company RichRelevance has acquired the assets of data analytics startup Precog, for an undisclosed sum.
Founded by former Amazon exec David Selinger in 2006, San Francisco-based RichRelevance currently has close to 200 customers including Walmart, Target and Marks & Spencer. Precog CEO John De Goes, along with members of that company’s senior engineering team, have joined RichRelevance.
Darren Vengroff, chief scientist & VP of product at RichRelevance, also a former Amazon engineer, spoke to AdExchanger about the acquisition.
AdExchanger: How will this build on your acquisition of Avail with regard to product?
DARREN VENGROFF: Historically, we’ve been in the business of retail personalization and the related businesses around targeting advertising in a personalized manner. Doing that requires some pretty heavy- duty analytics behind the scenes and as we’ve kept our eyes on the technology space, we’ve certainly been aware of Precog and the work they’ve been doing for quite some time. It seemed like a real opportunity to bring some cutting-edge analytics work in to our platform in order to help us build the next generation of retail and advertising personalization tools. That’s what drove the acquisition.
Speaking to the market as a whole, there are a lot of smart, up and coming companies. Sometimes, it’s two guys in a garage or a dorm room or in other cases, it’s more established companies with 20 or 30 people that have done a round or two of angel or venture-capital investing. There’s a tremendous amount of technical, mathematical and engineering knowledge spread across those. What many of them are lacking, we’ve noticed, is sort of an application for what they’re doing.
There are a lot of black boxes of, ‘We’ve developed this really cool technology and if we can find a bank that’s interested, well it’s great for financial services.’ Or, ‘If we can find a travel company that’s interested, then of course it’s great for travel.’ I think what we’ve always tried to do is focus on the retail and brand advertising customer and what they’re looking for from a business standpoint and trying to put together the right technical building blocks to support that. That’s the kind of thinking that drove this acquisition and that drives the thinking of, ‘Should we do further acquisitions in the future?’ When the time, place and right opportunity come along, we will. That’s not to say we spend our time out shopping the market, but I think there are a lot of smarts out there and you will continue to see these smart companies snapped up.
Where do you see the value of advanced data analytics from an ecommerce perspective? Is it to surface the most relevant ad or timeliest offer?
My take on it is not so much that there’s one area that’s more valuable than another but the value is generated from having the 360-degree view of your customer wherever they are and however they’re interacting with you.
Look back at the past 10 years and how, for example, the ecommerce channel evolved at a lot of retailers. You literally had a meeting where someone held up their hand and said, ‘These guys at Amazon look like they’re on to something. We should get into ecommerce too.’ And everyone in the room sort of nodded their head and said, ‘Yeah that’s great. Why don’t you go off and build that while we run the real business?’ And you ended up with these ecommerce siloes that were on completely different systems.
There would be a completely different CRM system [in online] than the brick and mortar side of the world. Ecommerce is the real business now and retailers realize they need to get these things together. I think the biggest thing is understanding, ‘What’s the consumer doing online over the weekend?’ and ‘What were they doing with their mobile app in your store last week?’ and then personalizing those channels because the consumer looks at your brand and sees only one brand.
