Oct 6 A small U.S. advertising company is making
waves in the tiny but rapidly growing market for personalized
SITO Mobile Ltd uses location-based data to target
ads to users of more than 250,000 mobile apps, including the
Wall Street Journal, Pandora and Major League Baseball.
SITO collects data including a device's ID and location as
well as the time an app is opened and uses those details to help
paint a picture of a user's behavior and preferences.
The company combines this data with other information from
companies such as Acxiom Corp's LiveRamp that can
provide details such as age, gender and household income on an
Users can opt out of ads delivered by SITO by turning off
location services on their device.
Jerry Hug, SITO's chief executive, says his company's
revenue could increase to between $35 million and $40 million
this year, from $19.2 million in 2015.
Revenue could double next year, he said.
Analysts, on average, expect 2016 revenue of $37.7 million,
according to Thomson Reuters I/B/E/S.
SITO, based in Jersey City, New Jersey, reported net income
of about $725,000 in the second quarter, the first profit in its
"Consumers I think always like a deal and they are willing
to be exposed to advertising that's relevant to who they are and
their real world experience," Hug said in an interview when
asked if concerns had been raised about privacy.
SITO, whose customers include Whole Foods,
McDonald's and Coca-Cola, listed on the Nasdaq in
The stock has risen almost 140 percent this year. At
Thursday's price of $5.03, SITO is valued at about $100 million.
Location-based advertising is still a tiny part of the
booming mobile ad business, but SITO expects the market to grow
to about $18 billion in 2019 from about $6.8 billion last year.
The company says it gives advertisers access to more than 98
percent of U.S. mobile consumers.
"What ... differentiates SITO is their real-time attribution
capabilities, where the company advertising can see in real-time
how many people were served an ad and subsequently walked
through the store," Brian Kinstlinger, an analyst at brokerage
Maxim Group, told Reuters. Maxim has a "buy" rating on SITO.
Capitalizing on SITO's growth, Hug is looking for
acquisitions in the $10 million-$20 million enterprise-value
range. "We have two letters of intent out ... and we have one
that we are in earlier-stage discussions," he said.
SITO, which plans to expand into the UK before the end of
the year, competes mainly with several unlisted companies,
including xAD, Verve and PlaceIQ.
(Reporting by Anya George Tharakan in Bengaluru; Editing by Ted