eBay Acquires Location-Based Media And Advertising Company WHERE
eBay has acquired location-based media company Where.com, the ecommerce giant tells us. Financial terms of the deal were not disclosed and the acquisition is expected to close during the second quarter of 2011.
Context & Ripple Effects
This is the third local-and-mobile move eBay has made since late 2010, and the clearest signal yet that the company is assembling a full stack rather than buying features. It confirmed the $75 million purchase of local-shopping startup Milo in December, shipped an augmented-reality try-on app in January, and over the holidays deliberately steered last-minute shoppers toward bricks-and-mortar stores to make its site more of a shopping resource. WHERE adds the missing layer: location-based media and advertising, the piece that monetizes knowing where a shopper is rather than just what they are searching for.
The deal also extends an acquisition playbook that goes back further — eBay's 2008 purchase of leading payments and classifieds businesses showed the same appetite for buying adjacency instead of building it. TechCrunch reports financial terms were undisclosed and the deal should close in Q2 2011, though Boston Innovation pegged the price at $135 million.
First-order effects
- WHERE's location-based advertising network becomes part of eBay's portfolio on close, giving eBay's mobile properties an in-house ad product built on where users are, not just what they browse.
- The Boston-based WHERE team and technology join eBay mid-integration of Milo, putting two recently acquired local assets under one roof during Q2.
Second-order effects
- With Milo covering local product inventory and WHERE covering local audience monetization, eBay can pitch merchants a closed local loop — surface nearby stock, advertise against the shopper's location, settle through PayPal — pressuring standalone daily-deal and check-in players whose models cover only one slice of that loop.
- Advertisers gain a marketplace-scale buyer of location data, which raises the bar for any rival trying to sell location-based media without comparable commerce data behind it.
Third-order effects
- If the pattern holds, large marketplaces will keep absorbing ad-tech startups to internalize the advertising layer around their transactions, shifting local commerce economics toward platforms that own the shopper relationship end-to-end and leaving point-solution local apps to exit or specialize.
- It also points toward retail media becoming a structural revenue line for e-commerce companies generally — commerce data as the raw material for an advertising business, not just a byproduct of sales.
The trend: E-commerce platforms are buying their way into location-based advertising to fuse local inventory, shopper location data, and payments into a single closed-loop commerce stack.