ValueClick is a Westlake Village, California-based online marketing services company. The company sells targeted and measurable online advertising campaigns and programs for advertisers and advertising agency clients, and generates qualified customer-leads, online sales and increased brand recognition on their behalf. ValueClick provides targeted advertising campaigns to reach online consumers as well as performance-based campaigns, where marketers pay for advertising only when it generates a lead or sale. The company's customer base consists of direct marketers, brand advertisers, and the advertising agencies that serve both these groups. ValueClick works with a network of third-party websites and other online publishing partners, which the company optimizes for specific marketing goals and to generate the audience for its advertiser's campaigns. Beginning with the fourth quarter of 2006, the company has begun reporting results across four operating segments with the addition of the Comparison Shopping segment. With this addition, the company now reports four operating segments, including Media, Comparison Shopping, Affiliate Marketing, and Technology. Virtually all of the company's revenue is generated in the United States, with just 1.5% generated from operations outside the country. ValueClick brands include Commission Junction, ValueClick Media, Mediaplex, and PriceRunner.
The Media segment (70.0% of 2006 revenue) provides a comprehensive suite of online marketing services and tailored programs, which help marketers increase awareness of their products, attract visitors, and generate leads and sales through the Internet. Included in the Media segment are Display Advertising Network, Lead Generation Marketing, Email Marketing, Search Marketing, and E-commerce. The Media segment has grown through a number of businesses, including Search123.com in May 2003, Hi-Speed Media in December 2003, Pricerunner in August 2004, Webclients and E-Babylon both in June 2005, and Fastclick in September 2005. The Display Advertising Network partners with third-party website publishers and applies VCLK's technology platforms to deliver and display advertiser's ad campaigns to the appropriate page of its partners' websites and track the results. Display advertisement placements are offered on a cost-per-thousand-impression (CPM) pricing, where the client's pay is based on the number of times the target audience sees the advertisement cost-per-click (CPC) pricing, where payment is triggered when someone clicks on the advertisement and cost-per-action (CPA) pricing, where a pre-determined action triggers a charge. VCLK also sells ads on a cost-per-lead (CPL) basis. With 14,000 active online publisher relationships in the U.S. and 16,000 worldwide, VCLK's display advertising network reached 132 million unique Internet users in the U.S. in December 2006, according to published industry data.
In Lead Generation Marketing, ValueClick manages online campaigns that generate qualified customer inquiries for an advertiser's product or service by collecting data when people request more information on a product. Leads are generated in four ways: by opt-in email lists, where consumers agree to receive an advertiser's messages through email co-registration, where consumers registering at a website agree to receive offers display ads, where partners agree to display online ads focused on generating leads and ValueClick owned and operated websites.
Email Marketing services allow marketers to target qualified prospective customers on a large scale with opt-in email lists from VCLK's proprietary database of approximately 97 million names and from a group of email list partners. This service allows advertisers to target audiences contained in the database with specific selection criteria.
E-commerce offers to sell a limited number of products directly to end-users through a small number of company owned e-commerce websites.
The Affiliate Marketing segment (20.5% of 2006 revenue) enables advertisers to develop their own online sales force comprised of third-party affiliate publishers. In affiliate marketing, a publisher joins an advertiser's affiliate marketing program and agrees to distribute the advertiser's offers in exchange for commissions on leads or sales generated. The publisher places the advertisers display or text links on their website, email campaigns or search listings, and receives a commission from the advertiser when a visitor takes a specific action. Affiliate Marketing's services are offered through VCLK's wholly-owned subsidiaries Be Free, acquired in May 2002 Search123.com, acquired in May 2003 and Commission Junction, acquired in December 2003. Affiliate Marketing's search services, including search engine marketing (SEM) and search syndication, are currently offered under the Commission Junction and Search123 brand names, respectively.
CJ Marketplace, an affiliate publishing network, is dedicated to VCLK's affiliate marketing business. Advertisers upload their offers onto CJ Marketplace, making them available for placement by affiliates. Affiliates apply to join the advertiser's program, and upon acceptance, select and place the advertiser's offers on their websites, in email campaigns, or in search listings. These links are tracked and served by Commission Junction. When a visitor clicks on one of the affiliate's links and then makes an online purchase or completes an agreed-upon action on the advertiser's website, that transaction is tracked and recorded by Commission Junction.
Search Marketing allows marketers to find prospective customers who are actively engaged in researching and buying products and services online. This platform is offered through pay-per-click search engines, in which marketers bid for placement within search results and pay only when targeted leads are delivered to their website. VCLK offers the self-service platform Search 123 and a premium offering called Simpli.
The Comparison Shopping segment (4.8% of 2006 revenue) enables consumers to research and compare products from thousands of online and offline merchants through its Pricerunner websites. The service is free for consumers, with merchants paying primarily on a CPC basis when consumers click through to their websites. In December 2006, ValueClick added Shopping.net, a privately-held London-based company that provides comparison shopping, search and vertical market content to European online consumers. In February 2007, PriceRunner selected Picsel Technologies, a provider of one of the world's leading mobile platforms, to deliver a free, fully comprehensive mobile price comparison service.
The Technology segment (4.7% of 2006 revenue) provides marketers, advertising agencies, website publishers, and other companies with the tools they need to manage business operations and marketing programs. These services are offered through VCLK's wholly owned subsidiary Mediaplex Inc. and Mediaplex Systems. Mediaplex is an application services provider (ASP) offering hosted tools that enable customers to implement and manage their own online display advertising and email campaigns. Mediaplex offers third party advertising, publisher ad management and email campaign management. Mediaplex Systems offers Agency Management, Media Management, and Content Management.