March 18 (Bloomberg) -- Glam Media Inc., a provider of Internet-advertising services targeting women, has acquired Canadian ad company BBS Media, expanding its business into new international markets.
Glam is paying $10 million to $20 million, according to people with knowledge of the deal, who asked not to be named because the terms haven’t been made public. With the purchase, Brisbane, California-based Glam will begin selling ads on behalf of Web publishers catering to Canadian women. They include Rodale Inc. brand Women’s Health and Toronto-based site Yummy Mummy Club, said Samir Arora, Glam’s chief executive officer.
Glam aims to stake out new territories in the $26.4 billion global market for display ads, the banner and video-marketing messages placed on Web pages whose sales may grow 32 percent to $34.9 billion by 2014, according to EMarketer Inc., which cited JPMorgan Chase & Co. estimates. In the past year, Glam has acquired companies or set up offices in Paris, London and Berlin, and countries outside the U.S. now make up more than a fifth of sales, Arora said.
“They have had success in the States, so it makes sense to see if they can transplant it to other markets,” said Karsten Weide, an analyst at researcher IDC in San Mateo, California.
Paul Loeffler, a spokesman for Glam, declined to comment on the terms of the BBS acquisition.
Founded in 2004, Glam has benefited from advertisers’ willingness to pay higher rates to reach narrowly targeted audiences, Weide said. Glam has relationships with more than 2,000 publishers, including female-focused blogs such as Hostess With the Mostess and StyleBakery, and shares the revenue from sales of ads on those sites.
Glam has recently held preliminary talks with bankers about a potential initial public offering, according to people with knowledge of the discussions, who asked not to be named because the talks were private.
When Glam weighs which new geographical markets to enter, the company first makes sure there is a large audience of women online, CEO Arora said in an interview last week.
“We look at country size, then we look at the audience of women that are online in that country, then at consumer spending” and how it’s split between genders, said Arora, who co-founded Glam after helping start software company NetObjects Inc. and working at Apple Inc. for nine years.
Arora saw that Canada’s audience had a similar Internet demographic to the U.S., which could be better linked to premium brands working with Glam. Buying BBS Media gives Glam relationships with publishers representing a combined audience of more than 9.5 million people in Canada.
“In Canada, there are really big conglomerates that are owned under one roof, then there are a whole bunch of small, grassroots blogs run by women,” said Erica Ehm, publisher of the Yummy Mummy Club. Her site, which runs articles, polls and videos for women, had sold ads through BBS and will now share ad revenue with Glam. “I now have an entree into one of the largest media companies in the world,” she said.
To contact the reporters on this story: Douglas MacMillan in San Francisco at email@example.com.
To contact the editor responsible for this story: Tom Giles at firstname.lastname@example.org