Toronto-based visual product search platform Slyce Inc. has announced its entrance into the mobile couponing space today, following a $6.5-million (U.S.) acquisition of Philadelphia-based SnipSnap.
Launched in 2012, SnipSnap has since amassed over four million users, who have taken pictures of, shared and utilized over 100 million coupons combined, saving the average user $40 each month. Slyce will also benefit from the 50 partnership agreements SnipSnap has solidified with North American retailers, including Toys “R” Us Inc., Lord & Taylor and Bed, Bath and Beyond.
“At the end of the day we’re generating instant gratification and convenience for customers to acquire products they see at the moment of inspiration,” said Mark Elfenbein, CEO of Slyce. “A very natural extension of that is to be able to generate a coupon for that product as well to help facilitate a purchase.”
The $6.5-million will be made payable in a combination of cash, Slyce common shares and conditional shares.
This is the third acquisition for Slyce in less than six months, having purchased BuyCode – a Tel Aviv-based company that developed Pounce, an image brand recognition-based shopping app – for $5-million (U.S.) in September, as well as DriveTrain – a Minneapolis-based mobile app development agency – for $3.5-million (U.S.) in October.
“We have set up the appropriate structures and holding companies in the U.S. to do those acquisitions,” said Mr. Elfenbein.“We're probably going to be continuously adding very opportunistic and synergistic acquisitions. It's just part of the company’s general strategy.”
Mr. Elfenbein adds that SnipSnap will continue to operate in Philadelphia as a division of the company, and that its founder, Ted Mann, will continue leading his team while leveraging resources from Slyce.
“We're going to keep them fairly independent,” he said. “They've been very successful and we don't want to disrupt that.”
The mobile couponing market, which is expected to see $25 billion spent on in-store performance marketing by 2017, according to study by Forrester Research, is not without its major competitors. Companies that currently enjoy a large share of that market include RetailMeNot, Coupons.com, and Groupon, which acquired Toronto-based couponing app SnapSave earlier this summer.
One of the advantages SnipSnap holds over its competitors, however, is its coupon generating capabilities for retailers. Furthermore, with over 4 million users, SnipSnap is one of the few couponing apps to have enough critical mass to earn advertising revenue from its retail partners.
“Slyce has a retail customer base that SnipSnap wants to get access to,” said Mr. Elfenbein. “It also gives Slyce another significant product offering that makes it much more sticky to retailers. We can now be their provider of mobile product search as well as mobile couponing, and actually allow them to create their entire coupon offering platform. It makes it a lot more meaningful as an enterprise product offering to retailers.”
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