At a time when “everyone is selling everything online,” Yotpo’s all-in-one eCommerce suite — which integrates marketing, loyalty, customer referrals and reviews into a single platform — has not only convinced over 30,000 brands, but has caught the eye of investors, too.
In announcing its largest-ever $230 million fundraise on Thursday (March 18), which values Yotpo at about $1.4 billion, the company’s CEO told PYMNTS that he has barely scratched the surface of this burgeoning business that already delivers over $100 million in annual recurring revenue.
“In a world where every brand is an eCommerce brand, and everyone is fighting over consumer attention, our vision of consolidating the marketing stack for eCommerce brands has definitely paid off, and is the reason that everything in Yotpo is accelerating,” said CEO Tomer Tagrin.
Specifically, the company has seen 170 percent growth in its SMS marketing solution and 96 percent growth in its loyalty and rewards business — and it found that brands that use two or more Yotpo products grew 54 percent faster than those that used only one. “When you think about eCommerce brands, all day long they’re trying to stitch together point solutions, with referrals and SMS and reviews and loyalty and engagement tools, and just so many different things,” Tagrin said. “What’s unique about [Yotpo] is we’re connecting that all together.”
Do I Have Your Attention?
Tagrin said where retail has historically been about “location, location, location,” eCommerce is all about gaining consumers’ attention and delivering a cohesive, engaging response.
“Our biggest challenge was having so many different marketing tools, vendors and programs, and none of them were talking to each other,” said Kim Zorn, head of performance at fashion retailer Princess Polly, which bought the full Yotpo suite. “[Now] we can send review requests via SMS, reward loyalty points for reviews, ask 5-star reviewers to make referrals and send loyalty members tier-specific texts.”
Although the business-building benefits of that level of customer experience and service are pretty evident, Tagrin pointed out that eliminating the negatives is also valuable, noting the awkwardness that arises when the customer review silo doesn’t communicate with the loyalty or marketing silos.
“Think about if you are a VP of eCommerce at a brand, and someone gives you a one-star review,” he said. “You would probably still [automatically] ask for a referral, and that’s like the dumbest thing you can do — but before Yotpo, you wouldn’t know it was the same person.”
More Than a Strange Name
Yotpo is actually an acronym for “Your Opinion, the Public Opinion” Tagrin explained, noting that although the original company slogan had changed about 200 times over the years, “we just kept the strange name.”
Today, with its growing roster of clients and investors, Yotpo is gaining name recognition and earning a place among larger competitors. “We are excited by Yotpo’s approach to providing a unified marketing tech stack and the value it provides to brands and online shoppers in the process,” said John Curtius, investor and partner at Tiger Global.
“Over the past 12 months, we’ve seen impressive growth from companies that were smartly positioned in eCommerce,” Bessemer Venture Partners’ Adam Fisher added. “Yotpo is no different, and belongs up there with the biggest players in the space, [like] Shopify, Affirm [or] BigCommerce.”
Tagrin quantified Yotpo’s evolution from a customer reviews company to an eCommerce marketing platform, noting that it took five years to get to $10 million in revenue for reviews, then about three years to do the same with loyalty — and now the company’s SMS marketing product has hit that same milestone in less than 12 months.
One-Year Plan, 10-Year Project
“The biggest challenge for us right now is hiring,” Tagrin said, pointing out that, with the company “firing on all cylinders,” he plans to hire 250 engineering, product, sales and customer success positions this year to augment the 500 existing Yotpo employees.
Although the company has fresh funding in hand, Tagrin is anything but complacent, and said Yotpo was fortunate to have been in the eCommerce business during the otherwise disastrous COVID era. That said, he plans to keep on grinding with the hard work involved in creating products that reflect the power of using deeply integrated marketing tools.
“We are literally just getting started,” said Tagrin. “We think that in order for us to fulfill our platform vision, we have at least 10 years [of work] ahead of us.”