Content Marketing Leaders Outbrain and Taboola

According to a report by Content Marketing Institute, 93% of B2B marketers used content marketing techniques in 2013 compared with 91% in 2012. The research reveals that 73% of B2B content marketers are producing more content in 2014 than they did a year ago. The report also projects that 58% of B2B marketers were planning to increase their content marketing budget in 2014.

Outbrain’s Offerings
The growth in content marketing has led to the rise of content discovery platform provider Outbrain. Outbrain was founded in 2006 by entrepreneurs Yaron Galai and Ori Lahav. Headquartered in New York, Outbrain is a leading content discovery platform that targets highly engaged audiences through distribution on publisher sites such as CNN, Fox News, Mashable, and Slate.

Organizations can use Outbrain’s tools to grow their audience by distributing their content on other sites where their target consumers are already looking for new content to discover. Alternatively, publishers can use their platform to offer recommendations and help the audience discover content on the organization’s site, thus generating both traffic and revenue.

Their widgets are normally located at the bottom of a news article along with images and eye-catching headlines, thus enticing users to click on them. In many cases, traditional banner advertising fails to attract the traffic that content marketing is able to deliver. While content marketing may be growing rapidly, it is also attracting its share of criticism. Analysts believe that content marketing blurs the line between editorial content and advertising, which it does.

However, such criticism is not bothering Outbrain too much. Their tools help provide more than 150 billion content recommendations each month. They end up showing more than 58,000 links to content every second to over 390 million web users monthly. Their service has been installed on over 100,000 blogs and websites worldwide. The company has tie ups with brands and agencies such as Starcom, American Express, and Exxon, thus providing a way for content distribution in addition to the publisher’s own editorial recommendations.

Outbrain’s Financials
Outbrain earns revenues by including ads among these recommended stories and charging a fee as a percentage of the revenue generated. Their financial details are kept under tight wraps, but reports estimate that they were targeting revenues of $130 million in 2013. The company has been venture funded so far with $99 million raised from investors including Rhodium, GlenRock Israel, Lightspeed Venture Partners, Carmel Ventures, HarbourVest Partners, Gemini Israel Ventures, Zohar Gilon, LGiLab, and Leon Recanati. Their last round of funding was held in October 2013 when they raised $35 million at a valuation of $350 million. The company is now expected to file for an IPO soon with plans to raise $100 million at a valuation of more than $1 billion.

Taboola’s Offerings
It is not just Outbrain who is delivering strong content marketing offerings. Their biggest competitor is another New York-based content discovery platform Taboola. Taboola was founded in 2007 by Adam Singolda who believed that instead of users searching for the content that they were looking for, information should have been looking for the user. That thought led to the desire to create a search engine that worked in reverse by creating a tool that would get information to look for the users.

Taboola began by creating a video recommendation engine that would deliver video content to users based on what they recently viewed. Today, that discovery engine serves more than 130 billion recommendations to 350 million unique visitors monthly on the publisher sites. While video content remains a big focus, they also offer recommendations to articles, slideshows, and other forms of content. Their clients include names like USA Today, The Huffington Post, Time, and The Weather Channel.

Last week, Taboola announced the acquisition of Pasadena, California-based programmatic advertising company Perfect Market for an undisclosed sum. The acquisition will help Taboola grow beyond content recommendation to product recommendation, thus expanding their market reach.

Taboola’s Financials
A recent CMO.com study found that consumers are 27 times more likely to click through an online video ad than they would a traditional banner ad. That definitely plays in favor of Taboola, which earns revenues by charging a commission for the revenue generated through sponsored search results. In 2013, they were expected to have crossed the $100 million mark in revenues while being profitable. Analysts estimate that besides their organic growth, following the recent acquisition, Taboola is set to hit a $250 million annual revenue rate in 2014. Till date, they have raised $40 million in funding from investors including Pitango Venture Capital, Marker, WGI Group, Evergreen Venture Partners, and Eyal Gura.

Like I said earlier, when I spoke with Taboola’s founder and CEO, I am a big believer in content marketing and I like what companies like Taboola have done in this space. They have surely hit a jackpot and the game has only just begun.