Deal targets Web users for online ads

GSI Commerce Inc., the fast-growing, King of Prussia-based company that runs retail Web sites for Ace Hardware, Dick's Sporting Goods, the NFL, Ralph Lauren, Timberland, Toys R Us, Zale's and other retailers, has shaken up its Marketing Services division management group after buying FetchBack Inc., a Tempe, Arizona ad "retargeting" firm that traces Web site visitors and sends them "dynamic and instantaneous" advertising offers to lure them back and close sales.

"Retargeting technology tracks what categories (and) products consumers have viewed on the site, or abandoned in the shopping cart, and FetchBack places ads purchased from ad networks to serve up that offer" to the consumer as he or she is online, writes Janney Capital Markets analyst Shawn Milne.

GSI won't say what it's paying; probably less than $20 million, says Milne, noting that if it paid more it would likely have to disclose the price as a "material" expense.

The deal gives GSI the services of FetchBack founder and boss Chad Little, who also founded Sandbox Entertainment and AdOn Inc. GSI will add FetchBank's 51 employees and won't have to cut anyone, spokeswoman Ellen Van Eck told me.  "It's their technology and their capabililities" that made the deal attractive, she added.

GSI also says it's adding FetchBack to its marketing service unit, alongside GSI Media and previously-acquired True Action, Silverlign and e-Dialogue, all reporting to marketing services boss Chris Saridakis. As part of the shake-up, True Action boss Nick Pahade has quit.

"Retargeting is far more effective than traditional display advertising," claimed Saridakis in the statement. "Their technology is well aligned with our strategy to expand" what GSI offers clients. FetchBack claims more than 500 online clients, including True Religion, Pingg, Abacus 24-7, Grand Canyon University, and Aqua Superstore.

Gridley & Co., New York, advised GSI, while Petsky Prunier advised FetchBack.