Retooled ValueClick rolls up firms to supplement offerings. (Corporate Focus).VALUECLICK Inc., an Internet advertising Delivering ads to Internet users via Web sites, e-mail, ad-supported software and Internet-enabled cellphones. Also called an "ad network," Internet advertising organizations act as a middleman between the advertiser and the Web sites and software publishers that display the ads. provider whose shares rode the dot-corn bubble to under $2 per share, has retooled and investors have taken notice. A shift in strategy that started in late 2000 has remade re·made v. Past tense and past participle of remake. the Westlake Village company from one that tracks advertising performance for other firms to one that sells Internet ad space, using its technologies to track the effectiveness of that advertising. When the bottom fell out of the Internet ad market, the company lost most of its customers. To rebuild, ValueClick began selling ads across a network of affiliated Web sites. Feeding the new focus has been a spate of acquisitions, capped earlier this month with the purchase of Agoura Hills-based Internet search technology company Search123.com Inc. "This is a strong acquisition and they have proven they can make acquisitions work. It gives them another advertising media to sell," said Stewart Barry, analyst at Delafield Hambrecht. ValueClick shares closed at $6.38 on June 18, close to its 52-week high of $6.54 reached June 6. The bump comes as the Internet advertising industry has shown signs of life. Yahoo Inc. saw its advertising revenue jump 38 percent in the first quarter over the previous year. A Goldman Sachs The Goldman Sachs Group, Inc., or simply Goldman Sachs (NYSE: GS) is one of the world's largest global investment banks. Goldman Sachs was founded in 1869, and is headquartered in the Lower Manhattan area of New York City at 85 Broad Street. analyst recently doubled his forecast for the online advertising industry, saying it would grow by 10 percent in 2003. ValueClick, which went public in early 2000, began to apply the "pay for performance" model to track the effectiveness of Web marketing campaigns to its own ad sales later that year. Now, ValueClick sells banner ads A graphic image used on Web sites to advertise a product or service. Banner ads come in numerous sizes, but are often rectangles 460 pixels wide by 60 pixels high. Also 460 x 55 and 392 x 72 sizes are commonly used. bundled with tracking software. Forbes.com Inc. announced earlier this month that it will use ValueClick's ad management tools. Adding to offerings The company is paid by advertisers based on performance factors such as how many people click on the ad, the number of leads it generates for its customers through its media network and other quantifiable measures of consumer interest. It is a model that has become more popular since the ad industry hit a slump. As part of its makeover, ValueClick went on a spree, acquiring online mailing list An automated e-mail system on the Internet, which is maintained by subject matter. There are thousands of such lists that reach millions of individuals and businesses. New users generally subscribe by sending an e-mail with the word "subscribe" in it and subsequently receive all new firms Be Free Inc., Bach Systems Bach system: see Bach, Alexander. Inc. and Z Media Inc., messaging firm Mediaplex Inc, and pay-for-performance competitor ClickAgents.com Inc. for a total of $190 million, largely in stock deals. Search123.com was acquired for $5 million in cash and stock. The company has also extricated ex·tri·cate tr.v. ex·tri·cat·ed, ex·tri·cat·ing, ex·tri·cates 1. To release from an entanglement or difficulty; disengage. 2. Archaic To distinguish from something related. itself from DoubleClick Inc., the leader. in the online advertising industry that had invested $85 million for a 30 percent stake in ValueClick. DoubleClick used ValueClick's ad performance technology but divested its stake late last year after it realized both were competing for media advertising dollars. ValueClick had been buying back DoubleClick's interest over time, ending the relationship in November when it bought back its remaining 9 percent stake, 7.9 million shares, as part of a broader $26.3 million buyback of 9.8 million shares. DoubleClick had been its largest shareholder. "They weren't effective on the media front and viewed us as a competitor on the technology front," said Samuel Paisley Paisley (pāz`lē), town (1991 pop. 84,330), Renfrewshire, W Scotland, on the White Cart Water, a stream. It has a thriving textile industry and is an extremely large producer of thread. , chief financial officer at ValueClick. DoubleClick, which counts the Dow Jones Dow Jones the best known of several U.S. indexes of movements in price on Wall Street. [Am. Hist.: Payton, 202] See : Finance & Co. Inc.'s Wall Street Journal as a client, now focuses on selling software services that track ad performance. "After the downturn all the clout went to advertisers. The fact that ValueClick is clicking now after a lot of firms disappeared says a lot," said Charles Buchwalter, vice president of analytics at Nielsen/Net Ratings. The consolidation has also made the field more competitive, said Buchwalter. Search-based advertising is the fastest growing ad segment as it leverages commonly used consumer tools for searching the Internet. "Now ValueClick can sell keyword ads and not just banner ads. You can do a search with any of their affiliate web sites and bid on the keywords," said Barry. DoubleClick has plans to develop its own keyword search technology internally, said Jennifer Blum, a company spokeswoman. And the keyword technology niche is dominated by Google Inc. and Pasadena-based Overture overture, instrumental musical composition written as an introduction to an opera, ballet, oratorio, musical, or play. The earliest Italian opera overtures were simply pieces of orchestral music and were called sinfonie. Services Inc. "We will not compete head to head with those large players. The attractive element is Search123.com's relationship with other search engines," said Paisley. [GRAPH OMITTED] YEAR (Dec. 31) 2002 2001 Revenue (millions) $62.6 $44.9 Total Expenses (millions) 71.4 57.8 Operating Loss (millions) (8.8) (112.9) Net Loss (millions) (10.6) (7.3) Loss Per Share ($0.14) ($0.20) [GRAPH OMITTED] SUMMARY Business: Online advertising Headquarters: Westlake Village CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. : James Zarley Market Cap: $419 million Dividend Yield: N/A * Total Liabilities: $32 million P/E P/E See: Price/earnings ratio : N/A Long-Term Debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. : $907,000 * ValueClick does not pay dividends. |
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