Cardlytics Surges; Big Tech Invades Banking

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Strong Cards

Cardlytics shares jumped almost 40% on Wednesday, pushing its market cap above $1 billion. The company partners with banks to create cash-back offers – so banking app users can be served promotional deals, and the discount is credited by the bank when a purchase shows up on the card. It’s been a monster year for Cardlytics (and other ad tech stocks). Cardlytics earned $56.4 million in Q3, up 63% year over year. And the stock price climbed from less than $11 at the beginning of the year to $56.94 at the close of trading Wednesday. Cardlytics also flipped to profitability this year. But that profitability is being managed, since Cardlytics has a multiyear strategic investment in a new automated platform, CEO Scott Grimes told investors. Cardlytics currently operates a “white-gloved managed service” complete with analysts and campaign controls. But that doesn’t scale effectively, he said. To go from hundreds of advertisers to thousands, or hundreds of thousands, it needs an automated platform that plugs into DSPs and agency buyers. The company plans to begin testing next year “with either a performance agency or maybe some other type of large advertiser partner,” said President and COO Lynne Laube. Read the release.

Credit Where Due

Google and Facebook are getting into credit and finance, despite the potential blowback. Google plans to test a consumer banking service next year that would offer checking accounts in partnership with Citigroup, The Wall Street Journal reports. Google’s foray into the credit industry “seems designed to make allies, rather than enemies,” according to the story. The company says customer financial data won’t be sold or used for advertising purposes. Separately, Facebook debuted its mobile payment processing product Facebook Pay this week, and Apple launched a credit card with Goldman Sachs this year. The moves show that big tech companies aren’t reining in strategic initiatives despite a wave of brand trust and loyalty issues, according to Axios.


Instagram’s new TikTok look-alike, Reels, launched with a test this week in Brazil. Reels lets users create 15-second video clips set to music and share them as stories, with an opportunity to go viral in a new “Top Reels” section in the Explore tab, TechCrunch reports. Users can choose from a library of songs or create remixes of other Reels posts. While Instagram can lean on the weight of its audience and social graph to grow the product quickly, it will have to retrain users to post music video-style content as opposed to spontaneous images throughout their day. It’s a classic Facebook move to clone a competitor’s product, just as Instagram did with Snap Stories a few years ago. “I think before TikTok, and TikTok deserve a ton of credit for popularizing this format,” said Instagram director of product management Robby Stein. More.

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