Kargo Acquires Rhombus, Gaining Unique Social Embed Ad Unit

By Alison Weissbrot | August 26, 2020

As seen on AdExchanger

An embedded tweet or Instagram post is often the first place a reader’s eye lands on the screen when reading an article.

Mobile ad exchange Kargo said Wednesday it will acquire Rhombus, an ad tech company focused specifically on targeting social embeds within articles, for that very reason.

Terms of the deal were not disclosed. Kargo will integrate the Rhombus tech into its exchange this fall and rename the product Social Canvas.

“The social embed is the most valuable real estate on the screen,” said Kargo CEO Harry Kargman. “We saw it as an incremental product opportunity we hadn’t thought of ourselves.”

Launched in 2018, Rhombus is the only company with social embed targeting capabilities across 19 major social platforms, said CEO Abe Storey. Advertisers can target against keywords, hashtags and metadata on social embeds within premium publisher pages.

“For advertisers, it’s a really unique way to extend their social strategy beyond the walled gardens using contextual targeting,” Storey said.

While Rhombus’ tool opens an incremental revenue stream for publishers, its ad units weren’t connected to the programmatic ecosystem. All buys were made as direct IOs.

With Kargo, Rhombus can scale its publisher integrations to become more accessible to buyers. Kargo is integrated with major demand-side platforms including DV360, MediaMath, Xandr and The Trade Desk.

Once fully integrated, Kargo will be able to offer Rhombus’ inventory through programmatic guaranteed deals via the open exchange. Kargo will also be able to bring audience targeting to Rhombus’ contextual inventory.

“We’re taking what makes Rhombus unique and sticky to the entire programmatic world,” Kargman said.

Pharma company Allergan, which began working with Rhombus in June, was excited to see social embed inventory become accessible programmatically – especially on a premium mobile exchange. Allergan declined to break out results, but said social embed targeting through Rhombus drove an increase in traffic, social engagement, brand lift and conversions for its CoolSculpting fat removal brand.

“Social does the best of all of our marketing channels,” said Myles Dacio, digital marketing manager at Allergan. “Having that in the programmatic space was so interesting.”

Rhombus also helps Kargo differentiate in an increasingly commoditized market. The exchange hopes this new ad unit will drive interest not just from publishers, but from DSPs where it’s not directly integrated already, such as Amobee and Verizon Media.

“It makes us that much stickier for the publisher because we're creating net new revenue opportunities,” Kargman said, “and to the advertiser because we can bring them something exclusive and unique.”

Success will hinge on how well the integration goes and how easy it is for publishers to turn on the Social Canvas unit. While Rhombus has direct integrations with a handful of publishers, it will be able to scale quickly through Kargo’s publisher tag. Publishers can simply update their Kargo tag to start selling the Social Canvas unit.

“Overnight, this gives us a volume of tier-one publishers that’s really valuable,” Storey said.

Rhombus was just starting to commercialize its product when COVID-19 hit. Joining up with Kargo will allow it to thrive as a product offering within a larger portfolio rather than a stand-alone product, Kargman said.

“Rhombus with no ability to transact programmatically is a challenging proposition,” he said. “With the incremental cost structure of rent, finance and all the rest, it’s more challenging today in this time of uncertainty.”