Hearst Acquires Social Shopping Site Kaboodle

Hearst has completed an acquisition of social shopping site Kaboodle. The e-commerce-friendly site opens cross-promotional opportunities for Hearst properties.

Kaboodle will operate independently, though the social shopping aspect offers synergy with Hearst properties, particularly Hearst’s women’s service magazines. Magazines like Good Housekeeping, Marie Claire, and Cosmopolitan can extend to the Web by creating buying guides, or the season’s hottest items. “What we do in print is now online in a community way,” said Kenneth Bronfman, president of Hearst Interactive Media.

Plans on how to integrate Kaboodle into Hearst properties are not finalized, but Bronfman said, “There is a wealth of ideas on what we can do together.”

With the power of Hearst behind the start-up, Kaboodle can work on advancing the site functionality and bringing in advertisers.

“It’s fair to say that Kaboodle as a development stage company has spent time building community and tools and hasn’t focused on developing advertising revenue,” said Bronfman. Hearst’s sales force will start to sell Kaboodle as part of packages with other publishing properties, and as a standalone media buy.

Building out relationships with big brand advertisers, as well as continuing to enhance the user experience is among Kaboodle’s goals. The site also plans to add premium content by way of editorial content from Hearst’s magazine properties as well as other publishers. Bronfman said Hearst will not hinder Kaboodle from pursuing relationships with other newspapers, TV properties, magazines and dot com properties. “They will do what they think is best to build the company, not beholden to Hearst,” he said.

The completed acquisition makes Kaboodle a wholly-owned subsidiary of Hearst. The Web property will be managed by Hearst Interactive Media and Hearst Magazines Digital Media. Kaboodle’s founder and management will remain in tact, and continue to operate in the company’s Santa Clara, California offices. Financial terms of the deal were not disclosed.

Computers and tech gadgets were originally a core driver for shopping comparison sites, according to Manish Chandra, founder and CEO of Kaboodle. He said fashion now leads the growth of e-commerce and comparison shopping sites. The category leaves room for the commentary Kaboodle and other sites offer users. The social component taps into the gene “that gets people talking spontaneously about a product.”

Kaboodle is one of a number of social shopping sites that encourage users to evangelize their favorite purchases. Competing start-up ThisNext shares revenues with its most active users.

The Kaboodle deal follows the recent acquisition of men’s lifestyle site UGO Networks.

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