Microsoft And Others Put $61M Into Intent-Driven Ad Technology Company Adchemy

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Advertising technology company Adchemy has raised $61 million in Series E funding from Microsoft, August Capital and the Mayfield Fund. This brings Adchemy’s total funding to $120 million. As part of the funding announcement, Microsoft is also announcing that it has expanded a partnership with Adchemy to offer the ad technology to its Microsoft adCenter customers.

Adchemy, which launched in 2005, offers a search engine marketing software that allows advertisers to deliver highly relevant advertising experiences to online audiences across search, display, social and mobile channels by leveraging consumer intent.

Basically, Adchemy’s IntentMap technology allows advertisers improve their paid search campaigns and expand keyword coverage by using consumer intent instead of individual keywords. The company says that by using consumer intent to manage and optimize
paid search campaigns, this reduces complexity while helping to serving highly targeted ads.

Adchemy feels that keyword targeting is flawed for advertisers, especially for large scale advertisers who buying massive amounts of keywords in search. Measuring intent provides a much more targeted experience, and Adchemy has built a powerful realtime technology that allows advertisers to optimize ads by what a searcher inputs into the search box.

So by decoding consumer intent using Adchemy’s algorithms, an advertiser can determine if a consumer wants to buy a new car now, or is simply doing research for a purchase sometime in the future. If you have more data into who the searcher is, you can understand if the searcher looking for a ticket from New York to Los Angeles might consider business class or would never consider that premium. Basically, relevance improves targeting, and high-targeted ads can improve click-through rates and eyeballs.

Adchemy was actually founded by current CEO Murthy Nukala and the late Rajeev Motwani, who also mentored of Google co-founders Larry Page and Sergey Brin.

The company’s technology has caught the interest of a number of companies included Accenture and Microsoft. Per the expanded agreement announced today, Microsoft and Adchemy offer the Adchemy IntentMap technology to help Microsoft adCenter customers create more relevant ads based on consumer intent on Bing and Yahoo search. The two companies previously launched a program focused on growing and improving the profitability of paid search campaigns for a select group of online retailers using AdCenter, including Macy’s and Overstock.com.

As Nukala explains “Moving away from keywords and focusing on a consumer’s underlying intent is a massive paradigm shift that radically simplifies ad campaigns and enables advertisers to address consumer queries in a significantly more relevant way, at a scale unprecedented in the industry. Our technology will help transform how advertisers reach consumers in search, mobile, and other intent-rich channels.”

And Nukala says that revenue from client search programs using Adchemy tend to go up by 200 percent. He also adds that the technology is particularly useful for search advertisers, such as retailers, who by massive amounts of keywords to advertise for a large library of products.

The new funds will be used to build out research and expand the Adchemy team.