In a move to bolster its coverage of the Internet advertising and marketing industry and to eliminate the competition, online publishing company internet.com, (NASDAQ:INTM) the parent company of Internet Advertising Report, Monday announced the acquisition of ClickZ Network for $16 million in cash and stock.
The deal calls for internet.com to pay $10 million in cash and $6 million in restricted common stock, with additional cash and stock to be paid based on future performance.
ClickZ operates a network of Web sites, email newsletters, and discussion lists targeted at Internet advertising and marketing professionals. The publications cover topics such as email marketing, media buying, brand marketing, and affiliate marketing. Internet.com plans to integrate ClickZ into its E-commerce/Marketing channel, which includes properties like AdResource, ChannelSeven.com, and Internet Advertising Report.
“We now cover every angle within the e-marketing category,” said Alan Meckler, chairman and chief executive officer of internet.com.
“Furthermore, ClickZ.com adds a critical audience to the internet.com network and we are now positioned to extend the marketing objectives of our advertisers and e-commerce partners even further.”
The acquisition effectively makes internet.com a one-stop-shop for advertisers seeking to reach an audience of Internet advertising and marketing professionals, as it now owns several of the most well-known properties in the space. ClickZ advertisers include DoubleClick, Engage, Hewlett Packard, MessageMedia, Winstar Interactive, FloNetwork, Commission Junction, Qualcomm, TargitMail.com and Burst! Media. The challenge will be to continue to wring more revenues out of advertisers that internet.com already counts among its clients, and bring ClickZ advertisers into the fold, cross-selling them other internet.com properties.
ClickZ brings to internet.com around one million monthly page impressions and a daily newsletter with 50,000 subscribers. Its email discussion list boasts 17,500 participants. There is fairly little overlap between ClickZ’s audience, and the audience for internet.com’s other marketing and advertising publications, according to ClickZ chief executive officer and publisher, Andy Bourland.
Investors weren’t too thrilled by the news. By mid-afternoon, internet.com was trading down 1 1/4 at $26 1/6.
Although the acquisition of ClickZ is consistent with internet.com’s strategy of acquiring publications to beef up its network, this is, by far, the most it has ever paid in such a transaction.
“The main draw was the site and the content and the brand,” said Meckler. “It’s a property that has been on our radar screen for about a year and a half.”
ClickZ executives say plans are in the works to extend the brand to new publications launched under the ClickZ network umbrella. “Within all of the areas that we’re planning on going into,” said Bourland. “There are some opportunities within the internet.com network to leverage the existing audience.”
Besides the content, internet.com also acquires the seminars that ClickZ has recently begun producing. Later this week it hosts the B2B E-mail Strategies conference, at which Meckler will be keynote speaker. The company hosted seminars on email marketing and on marketing strategies back in April and June. Meckler’s previous company, MecklerMedia Corp. became well known for its events, having originated the Internet World trade show.
It can’t hurt, of course, that ClickZ is “extremely profitable,” according to Meckler, although he declined to provide figures for the company’s annual revenue.
The greatest draw, though, according to Meckler, was the staff of ClickZ, which will join internet.com’s employee roster, while continuing to operate out of the company’s Andover, Massachusetts, offices. ClickZ has a staff of 25 employees and a stable of freelancers.
“We are excited to now be part of the internet.com network and we look forward to working with the internet.com team,” said Ann Handley, president and chief content officer of the ClickZ Network.
“We have always respected the world-class quality of internet.com’s editorial content and think that this is a perfect home for ClickZ.com.”
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