Taboola is getting boo’d
By Adam Ryan
There’s a recent article on Medium that was published called Taboola: A Truly Evil Company.
For background, Taboola has built a Google Adwords competitor with cheaper RPMs for advertisers and more “native” formats for publishers. The success of the business is shocking with more than $1.38B in revenue in 2021 and $108M in free cash flow.
How are they having success? Taboola works on exclusivity deals with publishers by having programmatic ads coded in on their website and offers the publisher rev share.
Why is exclusivity important? It doesn’t allow the publisher to take the ads off the site even if a competitor comes and offers 2X the RPMs. And if a publisher attempts to leave because it’s best for their business then Taboola is holding back payments to the publisher.
This is what sparked the Medium post.
But the hate isn’t everywhere. Business Insider, Forbes, Penske, Altice News, and many more big-name publishers use the platform for high-margin low-lift advertising revenue.
The irony of pulling the customer list of those who use Taboola is it’s all the publishers that have massive engagement issues. In many ways, the collective of publishers looks like the case study of how to not run an audience-first company.
That’s the real evil of Taboola. It’s not their business model, exclusivity terms, or how they hold payments back – it’s their total disregard for anything that is useful to build affinity with an audience.
Look at the example from Business Insider. I’ve used this example in a lot of presentations, but tell me you care about the quality of content and user experience while putting an ad of a pathetically sad-looking Macaulay Culkin next to an article about the iPhone. It’s an absolute joke.
Taboola has more than 9,000 publishers they work with according to their site. As a value prop, they talk about maximizing your paid traffic spend (by having banners on the landing page) and other arbitrage opportunities. As the account manager stated in the Medium article, their suggestion for making more revenue is simply by adding more ads.
It continues to be ironic that our industry, which is based on creativity, continues to come up with the least creative ways to maximize revenue.