Businessmodel of Criteo

Customer Segments

Criteo serves two principal customer segments: its advertisers and its publishers. Criteo provides performance marketing and digital advertising services to 11,000 advertisers and brand marketers across a range of sectors and from more than 88 countries, with its principal markets being the US and Europe. These customers primarily comprise companies with an online sales presence, enabling advertisements to lead directly to online sales. Criteo includes a number of high-profile companies among its advertising customers such as Ebay, Sony, Dell, Expedia, Zappos, Air France and Lenovo.

Criteo also serves 16,000 online publishers worldwide, comprising media and news portals, online retailers, blogs and tech companies. The Company’s products and services allow publishers – including Airbnb, Batman News, Faith Hub and ADN – to monetise their inventory.

Value Propositions

Criteo’s principal value for advertisers is that it provides personalised advertisements targeted at specific consumers using proprietary algorithms and user browsing habits. This method is purported to lead to a greater generation of sales revenue for its customers.

The Company also offers a flexible pricing model to its advertising customers, with fees charged on a pay-per-click basis. Customers are also able to decide on how much they pay per click, altering the pricing depending the rate of return on their investment.

For publishers, Criteo provides an opportunity to generate revenue through its content, offering free, self-service access to its partner program.

Channels

Criteo’s products and services can be viewed through its website at www.criteo.com, with sales made via the Company’s sales and marketing team. Criteo delivers advertisements for its customers across multiple channels, viewable on multiple devices, including desktop browsers, mobile and tablet browsers, and mobile applications.

Customer Relationships

While Criteo’s advertising and marketing products can be viewed freely on its website, purchases must be made through the Company’s sales and marketing team, which can be contacted via an online form or over the phone. Account information can be accessed and altered through the Criteo homepage, including changes to pricing, which can be made on a self-service basis. Publishers are able to register on a self-service basis.

Criteo provides a range of resources to its customers, including reports, ebooks, webinars and infographics. The Company also publishes a list of events at which it will be present, so that customers are able to interact with Criteo representatives in person, and keeps customers informed of its activities through its blog, press releases and news coverage. Customers can also interact directly with Criteo through the Company’s LinkedIn, Facebook, Twitter and YouTube accounts.

Key Activities

Criteo is a global technology company that specialises in the provision of digital performance marketing solutions. The Company’s flagship products – Criteo Dynamic Retargeting and Criteo Dynamic Email – use various machine learning algorithms and data pertaining to user browsing habits to provide targeted, personalised advertisements with a view to increasing after-click sales for its advertising clients.

Criteo delivers advertisements across multiple devices and channels in formats including display advertising, native advertising and marketing communications delivered to opt-in email addresses. The Company also partners with a number of mobile and in-app analytics providers to provide insights into app performance data.

Key Partners

Criteo operates an App Measurement Partner Program, which it launched in 2015 following the discontinuation of its own Ad-X Tracking product, through which it partners with a number of mobile measurement and analytics providers to help assess track in-app performance across its products. These partners include two of the market’s largest in-app tracking companies, Tune and Adjust, as well as smaller mobile analytics players AppsFlyer, Apsalar, and Kenshoo.

Criteo additionally partners with advertising technology companies and service providers in order to offer its clients the most reliable service possible. This includes a partnership with Integral Ad Science, which analyses the value of digital advertising placements and provided brand security and ad verification services. The Company is also listed among Facebook’s marketing partners.

Key Resources

Criteo’s key resources are its technology, its IT infrastructure and its personnel, notably its large sales and development teams. Criteo has four patent applications registered in its name with France’s National Institute of Property, including applications titled ‘Fourniture de créations publicitaires à des dispositifs informatiques’ and ‘Paramétrage de cookies propriétaires par redirection’. The Company is also named as an assignee in a foreign patent application for ‘Data processing apparatus for propagative correlation’ filed with the US Patent and Trademark Office.

Cost Structure

Criteo’s principal costs relate to the development of its technology, the maintenance of its IT infrastructure and the retention of its personnel. The Company employs a workforce of more than 1,600 worldwide, incurring costs relating to salaries and benefits.

It also operates a network of more than 25 offices across the Americas, Europe and Asia Pacific and the Middle East, accruing fixed costs in the form of rent and utilities.

Revenue Streams

Criteo generates revenue through its performance marketing and advertising products. These products are priced on a pay-per-click basis, whereby customers are charged only when an advertisement generated Criteo leads to the completion of a specific marketing action: a sale, a lead or a click.

The Company does not have a fixed pricing system, instead allowing customers to alter the price per click at any time depending on how much they are willing to pay, decreasing and increasing the price depending on their return on investment.

In the fiscal year 2015 Criteo generated €1.19 billion in annual revenue. The Company is showing an increase in revenue generated by its mobile ads, with approximately 47% of its revenue in December 2015 alone coming via this channel.