Ligatus Türkiye

What did it do?

Ligatus was a Cologne-based native advertising company that operated in the Turkish market from 2013 through its Istanbul office. It offered publishers a local supply-side platform (SSP) and consultancy, and advertisers ad formats that blended into the content feeds of news sites. It worked through both programmatic and reserved sales channels.

Why did it shut down?

In January 2019 Ligatus announced its decision to withdraw from Turkey as a strategic business decision, without giving a detailed reason (Webrazzi, egirişim, 2019). According to the statement, the company's new priority was to complete its expansion across continental Europe as competitively as possible. In other words, Turkey was not among the markets in which the parent company wanted to concentrate its resources. It is striking that the decision came right after 2018, when the Turkish lira lost value sharply; but the sources do not draw this link, and this is an interpretation.

The story

Ligatus was one of Europe's leading companies in native advertising. The Cologne-based company was a wholly owned subsidiary of Gruner + Jahr, the publishing group owned by Bertelsmann, and ran ads on news site pages that looked like a continuation of the content being read. It offered publishers a local supply-side platform and expert consultancy. It had more than 180 employees in its offices across Europe.

Having opened its Istanbul office in late 2012, the company began operating in the Turkish market in 2013. In April 2017 Emre Faks, who had been group coordinator for digital experience and advertising solutions at the Turkish daily Hürriyet, replaced the previous country manager, Murat Kalafat; Faks also took on business development in the MENA region. Before that, in 2016, the company had formed partnerships with ad tech companies such as AppNexus and Criteo.

In October 2017 the company celebrated the Istanbul office's fifth year with an event in Harbiye; according to Marketing Türkiye, in that time it had worked with more than 200 of Turkey's leading publishers and contributed to the business of nearly 1,000 advertiser brands. Webrazzi, too, described Ligatus as one of the leading companies in the Turkish market.

In January 2019, however, came an unexpected announcement. Ligatus said that, as a strategic business decision, it had halted its operations in Turkey and would end its Turkish investments as of 1 February 2019. In the company's new growth strategy, the priority was to complete its expansion in Europe as competitively as possible. In a brief statement, Emre Faks said they still had faith in Turkey and would continue to follow the market closely, and thanked the partners they had worked with for six years.

The story of Ligatus Türkiye is not that of a start-up going bust, but of a portfolio decision by a multinational ad tech company. Even so, the result was the same for the Turkish publishers earning advertising revenue through the network: after six years, a significant revenue channel pulled out of the market.

Lessons for founders

• However much you grow as the local arm of a multinational, your fate depends on portfolio decisions made at headquarters.
• Tying publisher revenue to a single ad network creates a revenue gap when that network pulls out.
• The more briefly a decision to exit a market is explained, the more it shakes partners' trust; manage the transition in a planned way.

Sources

1. Native advertising company Ligatus decides to withdraw from Turkey (Webrazzi, 2019-01-15)
2. Native advertising company Ligatus halts its operations in Turkey (egirişim, 2019-01-14)
3. Ligatus Istanbul office celebrates its fifth birthday (Marketing Türkiye, 2017-10-27)
4. Emre Faks becomes Ligatus Türkiye country manager (Webrazzi, 2017-04-10)
5. Ligatus halts its operations in Turkey (Digital Age, 2019-01-14)

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