Seeking Alpha

Rocket Fuel rallies following Criteo acquisition report

  • A report stating leading ad agency Publicis is close to a deal to acquire Criteo is providing a lift to fellow online ad retargeting firm Rocket Fuel (FUEL +3.6%).
  • The gains come in spite of a downgrade to Neutral from Citi, which cites industry challenges. Rocket Fuel cratered earlier in August after providing light guidance that was blamed on tighter control of client spend by agency trading desks, a shift among advertisers towards direct licensing, and industry concerns about ad inventory quality.
Comments (11)
  • James Sands
    , contributor
    Comments (2249) | Send Message
     
    Why???? Clearly Rocket Fuel is inferior to Criteo....
    29 Aug 2014, 11:51 AM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    Rocket Fuel isn't a retargeting firm. It is a DSP. It has zero chance of being acquired. All the majors already have their own DSP.
    29 Aug 2014, 11:56 AM Reply Like
  • SA Editor Eric Jhonsa
    , contributor
    Comments (899) | Send Message
     
    Rocket Fuel and Criteo are generally viewed as retargeting firms, in that they each rely on user data/algorithms to buy ad inventory and deliver targeted ads on behalf of clients.

     

    http://bit.ly/1ll75ck
    29 Aug 2014, 12:07 PM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    Thats not accurate. It is a DSP. It has no reputation for retargeting like Criteo, Ad Roll, Perfect Audience. There us tremendous misinformation and misunderstanding in this space. Clearly nobody knows what these companies do.
    29 Aug 2014, 12:12 PM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    Retargeting is very specific in ad tech. Not many companies specialize in it. Criteo does and is the biggest by far. Ad Roll is #2 and Perfect Audience (Marin) likely #3. Of course Google and others offer it but not as a sole focus like these other firms.
    29 Aug 2014, 12:15 PM Reply Like
  • SA Editor Eric Jhonsa
    , contributor
    Comments (899) | Send Message
     
    Rocket Fuel is a DSP, but it still considers itself a provider of retargeting services, as seen here:

     

    http://bit.ly/1ll9ZxB

     

    Admittedly, definitions vary a lot from place to place when it comes to ad tech. Also true for terms such as programmatic and RTB.
    29 Aug 2014, 12:20 PM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    The deal makes little sense though. I am not sure why an agency would buy a retargeting company? It seems unlikely. And Criteo is very low tech. They have no programmatic at all. Everything done manually through heavy sales and support and top heavy. Ad Roll or Marin is a much more logical bolt on acquisition for an agency.
    29 Aug 2014, 12:24 PM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    Sure, same with Google (offers retargeting through its remarketing tab in Ad Words campaign manager). I wouldn't consider Rocket Fuel (or Google) to be a retargeting firm by definition as its likely a very tiny part of its business. I also don't understand the Criteo rumor and don't think it is true. I don't know why Publicis would want to own Criteo. It makes little sense. We will see I guess. I've seen stranger. What do you think Eric?
    29 Aug 2014, 01:02 PM Reply Like
  • SA Editor Eric Jhonsa
    , contributor
    Comments (899) | Send Message
     
    Hey Charles, just saw your question. Been busy moving. Anyway, I'm guessing Publicis thinks it shares a lot of customers with Criteo, and (even if direct synergies aren't huge) sees a chance to cross-sell its brand/agency clients another service. One that happens to be seeing growing demand.

     

    Publicis might also be trying to please the French government by acquiring a local tech company. The government has made a big deal out of trying to keep local tech firms under French control. They even blocked Yahoo's bid for Dailmotion, though Dailymotion is just a niche player in online video.
    1 Sep 2014, 04:04 PM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    Looks like Reuters dispelled the rumor a little after I posted and the stock dropped, but then rallied.
    1 Sep 2014, 04:17 PM Reply Like
  • Charles Moscoe
    , contributor
    Comments (1712) | Send Message
     
    The only public company that is a retargeting firm is Perfect Audience, owned by Marin.
    29 Aug 2014, 11:57 AM Reply Like
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