Engage:BDR moves quickly to capitalise on new revenue stream for web advertising
Link copied to
Special Report: The new web vertical is already live and making money, as engage:BDR looks to expand its market opportunity in the second half of the year.
For tech advertising platform engage:BDR (ASX:EN1), the disruption caused by the COVID-19 pandemic has also created opportunities.
Along with its mobile app business, the company has also reacted to a sharp increase in mobile and desktop web traffic during the June quarter. And it responded quickly with a new programmatic offering that’s already generating revenue.
Speaking with Stockhead this morning to discuss the announcement, company CEO Ted Dhanik said the web offering markets a strategic pivot after the company dedicated its focus on the mobile app market in 2017.
Previously though, engage:BDR had worked with web advertising partners for “the entire history of the company”, Dhanik said.
“We were making more money on apps so we focused on that vertical. But now as we start seeing more demand come back for the web, we thought ‘hey it won’t hurt for us to be in this area as well’,” he said.
And having highlighted the opportunity, the company had to execute fast to make the most it.
The pivot to web advertising has been driven by increased demand for traditional media products such as breaking news, entertainment and weather information in the wake of the disruption from the pandemic.
That demand will complement engage:BDR’s app-based advertising channels in areas such as online games, social media and education.
“The technologies are very different in terms of their architecture and framework,” Dhanik explained. “But because our teams were so efficient working from home, we’ve been able to build out this new product framework in around half the time we expected.”
As a result, the platform is already live and generating top-line revenue.
“It’s all incremental revenue, so we think it’ll improve our top-line growth for the quarter. But those benefits will extend to subsequent quarters too, in terms of the impact on customer growth and our integrated partnerships,” Dhanik said.
The new market opportunity follows some more good news last week, when engage:BDR got a boost to its cash position via a $US150,000 funding facility (~$230k) from the US Small Business Administration – part of the government support measures to assist businesses during the pandemic.
The renewed demand for web advertising will give engage:BDR an opportunity to “re-activate” partnerships with web publishing businesses that it worked with in its first seven years of operations, until the shift to mobile in 2017.
“I think it could match our existing business, and from the kind of scale we’ve been seeing it could be pretty big from a revenue standpoint,” Dhanik said.
“App and web are independent from an advertising perspective, but they’re about equal in size. So it will take a little bit of time to ramp up but it’s a similar business, with similar scale to our apps division.”