Merchant Innovation

Taboola CEO: Why Android News Will Unlock New Content/Commerce Models

It’s called the Paradox of Choice, or “analysis paralysis” – and anyone who has ever frozen in the face of searching Netflix for a Friday night movie has felt its icy grasp. Stated simply, it says that too much choice is bad for the average customer, who becomes so weighted down trying to figure out what they “really want” that they find it hard to choose anything at all.

It can hit consumers literally anywhere: 25 years ago, it was first documented while people were shopping for jam in a grocery aisle. In the case of Taboola’s CEO and founder Adam Singolda, it struck while he was trying to unwind after a seven-year stint in the Israeli army as an engineer in an elite mathematical unit.

“All I wanted to do,” Singolda told Karen Webster for this week’s edition of the Monday Conversations, “was relax, watch TV, read the paper and be a regular person. I was really enjoying it, because I had nothing to do.”

Unfortunately, despite hundreds of channels offering him content – not to mention an internet that would connect him directly to any news source in the world – he couldn’t find anything he wanted, due to the wonders of analysis paralysis. If he knew exactly what he was looking for, he easily could have searched any of the myriad platforms for content.

But he didn’t know what he wanted, and boredom set in – but it was boredom with a twist. Singolda was no longer an engineer with nothing to do – he was an engineer with a problem to solve and something to build.

“I wanted a reverse search engine, with results that would find me without my needing to search for anything,” he said.

That tool – an engine that could reverse-engineer personalized recommendations – became the root for Taboola, the firm he founded. Today, Taboola is a consumer content discovery platform that pushes over 450 billion content recommendations to users every month spread across “thousands of premium sites and mobile carriers,” according to the company’s own reporting. Singolda told Webster that as of last year, they booked over $1 billion in revenue.

And it will now extend to Android users by way of a “better version” of the service Apple News provides for iOS users, Singolda said. That market, he told Webster, is appealing for a number of reasons – not the least of which is that Android has nine times the user base of Apple.

It’s an ambition that’s now a step closer to reality, given last week’s news of a partnership with ZTE, one of the world’s fastest-growing smartphone manufacturers.

Building Android News

Singolda noted that ZTE is a natural partner for Taboola, simply because of how quickly they are taking on the market.

Though they don’t have the name recognition of Samsung or Google in the smartphone market, they already have a 12 percent market share in the U.S. – and that kind of presence counts for a lot when one is signing up to build an Android News aggregation service.

The two firms will jointly roll out a personalized news content aggregator for ZTE Android devices, leveraging Taboola’s content personalization technology to match ZTE phone carriers with content they are most likely to be interested in consuming next on their device.

“ZTE is aggressive, they are innovative and they are very global. It’s a very good fit,” Singolda said of the partnership. And, he noted, it’s also a very good springboard to the larger Android universe.

“Our hope is to one day be on every Android device, offering this service for every Android user,” he said. “The biggest chance here is to create value for consumers and build a new audience in the open web. The goal is to increase the pie, so that everyone can enjoy it.”

A Long Road – and a Platform Pivot

The new ZTE partnership is a milestone achievement for a firm that had absolutely no revenue for the first six years of its life. Taboola had a great technology, but a bad business model.

“I tried to charge publishers for our services directly, and it was a business model that failed miserably,” Singolda recalled.

It almost became the firm’s fatal flaw until in 2012, Singolda and team hit the reset button with a big business model pivot. Taboola’s technology became a content engine inside of bigger content marketplaces, where they were paid by advertisers to promote their portfolio of consumer content within those sites.

Singolda said they went from zero dollars for each of the first six years to $100,000 in revenue that year – something that he and his founders thought was “beyond exciting.”

Singolda attributes Taboola’s success to solving two problems: giving writers a way to monetize their contributions, and publishers a new way to add content and a revenue stream from that content.

Human Error and Human Solutions

Taboola, Singolda told Webster, is an invisible consumer brand, which means they succeed only if their publishers succeed, and the open web remains a viable place for publishers to push their content.

Taboola’s main motivation is to make matches that consumers like – and trust – so they click through to content they believe to be accurate. Part serendipity, part driven by previous likes and dislikes, consumers are introduced to content prompts at the bottom of articles, touting everything from tips for improving a golf game to the five foods cardiologists say to avoid.

And in the current market, Singolda said, trust is rapidly becoming everything.

Though the last six months of explosive revelations around Facebook, fake news and user data security concerns have brought the issue to a head, the major trust deficit in digital content has been growing for a while.

So-called fake news, Singolda noted, is part of the problem, but is only the tip of the iceberg. There are a lot more things wrong in the world of digital content.

That means that Taboola screens its content for more than news that lacks legitimate sources. There are obvious candidates – like alcohol, drugs or cigarettes – but there is also the plethora of articles promoting tips for buying bitcoin that they don’t serve to consumers. Taboola, Singolda said, is particularly vigilant on content that feels like deceptive advertising, particularly around medicine or medical procedures.

When it comes to spotting the “human error” that contributes to the world of bad content, Taboola thinks that actual human beings in the form of a large and growing compliance team are the best way to distinguish the “bad” content they don’t want featured on their platform from the “good” content that they do.

Singolda said that the compliance team – which now includes 30 members – reviews about a million articles a month. And while they don’t always get it right, they are always ready to learn how to do it better and find ways for consumers to flag or push back on content they don’t want or like.

The goal, he noted, is to build a trusted pipeline of information from a variety of sources around the web, and then ensure that the user who sees that content is properly matched to information that is relevant to them.

“Our hope is to one day be on every Android device, offering this service for every Android user,” Singolda noted. “The biggest chance here is to create a new marketplace for high-quality publishers to create value for consumers and build a new audience in the open web. The goal is to increase the pie, so that everyone can enjoy it.”

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