Microsoft buys retail advertising start-up PromoteIQ

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Microsoft CEO Satya Nadella at a company event in Washington in 2014.

Source: Microsoft

Microsoft on Monday said it has acquired PromoteIQ, a small company that has focused on helping retailers incorporate ads into their online storefronts. Terms of the deal weren’t disclosed.

The deal is a reminder of Microsoft’s deep competition with Amazon in another market — public cloud. Amazon Web Services rules the business of providing computing and storage infrastructure for other companies to use, but at the same time Amazon the parent company is mainly in the business of online and offline retail. Some retailers like Walgreens and Walmart have chosen Microsoft for their public cloud needs in recent years.

Microsoft has selected retail as a key industry for its sellers and marketers to focus on. Now the company has made an acquisition that could help it work with retailers as they seek to compete better with Amazon. Product advertising represents a growth spot for Amazon.

PromoteIQ has worked with B&H, Kohls, Kroger and Office Depot, among others.

“PromoteIQ’s technology strategically complements Microsoft’s current retail advertising offerings, and together, we can enable retailers with a portfolio of technology solutions to modernize their e-commerce platforms and maximize their monetization opportunity,” Rik van der Kooi, corporate vice president for Microsoft advertising, wrote in a blog post on Monday.

The company behind PromoteIQ, Spotfront, was founded in 2012. PromoteIQ is based in New York and has about 40 employees listed on LinkedIn.

Advertising isn’t the biggest area for Microsoft but it’s also not tiny. Search advertising represented almost 9% of revenue in Microsoft’s 2019 fiscal year, which ended on June 30, according to the company’s annual report.

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