Commentary

Autobytel Snaps Up Piece Of AutoWeb

Online auto research and shopping site Autobytel has invested $2.5 million in cash to back AutoWeb, Inc.'s pay-per-click (PPC), auction-driven automotive advertising marketplace, which is scheduled to go live in early 2014. Autobytel has an option to invest an additional $2.5 million as AutoWeb grows.

As part of the agreement, AutoWeb has acquired the AutoWeb trademarks and domain name (www.AutoWeb.com) from Autobytel for $1.5 million in AutoWeb stock. As a result of the initial investment, Autobytel now owns approximately 16% of AutoWeb. Jeffrey Coats, President and Chief Executive Officer of Autobytel, has joined AutoWeb's Board of Directors.

Autobytel will become the first automotive publisher to benefit from AutoWeb's PPC platform, receiving a share of the revenue generated by click-throughs at Autobytel's websites, per the company, which said it believes the arrangement could represent a significant revenue opportunity over the next several years.

AutoWeb's proprietary technology analyzes web traffic and adjusts advertiser costs accordingly based on traffic quality, versus standard pay-per-click models.

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