The ad tech 'animal' comes in different shapes and sizes. For co-founders Amit Shah and Scott Switzer, the 'animal' is analytical as their growing analytics startup, Jirafe, aims to provide merchant publishers a better view on their digital business – including ads, sales, conversions and more. So far the company has impressed 5,000 ecommerce clients and venture capital firms Foundry Group and FirstMark Capital, who recently invested $7 million (read the release).
Each founder has extensive experience in the ad tech space as CTO Switzer founded OpenX and CEO Shah worked there in a sales capacity before moving to ecommerce software company Magento - not coincidentally, Jirafe tightly integrates with Magento's platform.
Shah explains that the seeds of Jirafe were sewn while he was at OpenX when Magento (acquired by eBay) was busy buying display ads through OpenX's exchange. For Shah and Switzer, that mix of ecommerce and exchange-based, display media buying inspired the need for an ecommerce analytics solution. And so they started Jirafe in 2010.
But, wait – isn't ecommerce analytics Adobe Omniture territory?
AdExchanger spoke to Shah.
AMIT SHAH: For us, that's the starting point. Being another analytics company is okay, but what's missing today, if you talk to merchants who use Omniture and other products, is they say, "Look, I have enough charts and graphs. Just tell me what to do. I go into seven different applications every day, looking at a ton of data and it's still not obvious what changes I need to make every single day to my business across all these different applications." So that's where we're headed with Jirafe. The goal is every time you log in, we're going to tell you the top five revenue opportunities for your business today, for example - "Here's what you need to take advantage." The goal is to get from data to insight to action.
AdExchanger: Aren't display ad retargeters out there helping make those decisions today?
Yes, and you bring up a whole hornet's nest of issues around the re-targeting space, number one amongst them is that the retargeters get to enjoy the 'cream' of the marketing budget of a retailer. For example, let's say you're Toys-R-Us, and you're spending on Pinterest, Facebook ads, Google PPC and you're spending on SEO. That's a ton of time, energy and resources to get traffic to your site and, for whatever reason, if the transaction doesn't close, there's this retargeter who shows up at the end and says, "I'll complete the loop for you but I'll charge you a whole bunch extra." Fundamentally, we want to give these tools back to a merchant. Maybe I'm skeptical, but I look at these retargeting companies and I wonder how much added value there is versus automation of workflow.
So what is going to be a typical use case for Jirafe products?
When we looked at our 5,000 merchants, we saw that the abandoned shopping cart revenue per month is over $100 million. So, the first step for us is to highlight to a merchant where their revenue opportunities are. The next step is to deliver a solution. What the team is building right now is around abandoned cart targeting using email and display ads. We think there's a big revenue opportunity for our merchants as we complete the loop for them.
The goal over the next eighteen months is to keep building more of these services that make it easy for a merchant to take advantage of things that you get if you're Toys-R-Us, but you don't get to do if you're outside the top five hundred retailers. I don't think anyone at [Omniture] is going to look at us and say, "Oh my God they're coming after us." Hopefully, we're going to solve the needs for the other two million merchants that are way too small for [Omniture].
What is the display advertising 'story' with Jirafe?
Fundamentally, we come from OpenX. We believe there's a display advertising market that has value. But, for a lot of merchants it's extremely difficult to figure out how to make display work. Google did an amazing job with self-serve around [PPC and search]. But if you're a small to medium sized merchant, how do you make display work? That's where we come in.
What can you share in terms of the milestones that you would like your company to accomplish in the next 12 to 18 months?
Within the next twelve to eighteen months, we want to go from 5,000 merchants to 100,000 merchants and, secondly, we wan to be able to directly impact the revenues of our merchants. At the end of a month, a day, a week, a month, a year of using Jirafe, a merchant can stand up and say that his product grew their revenues by 50%, 80%, 100%. I use these three marketing services that can help me build.
Do you offer any sort of performance goal that you will hit for clients?
That's where we want to get the company to - a point where we can go to a customer and say, for example, I will pay you $1,000, $5,000, $50,000 to use Jirafe -- because we know that the amount of revenue we can bring to their business is multiples of that. That's the goal of our business.
By John Ebbert