EMERGE acquires WagJag from Metroland Media Group

WagJag

EMERGE Commerce Inc., formerly known as Transformational Capital, has acquired Wagjag, an online deal community, from Metroland Media Group, a subsidiary of Torstar. Terms of the deal were not disclosed, but the former WagJag employees will now work out of EMERGE’s Toronto headquarters.

EMERGE now has 4 million members across a portfolio of 5 brands in Canada, the US, and the UK.

Absorbing Wagjag’s 1 million members, the acquisition provides the retail-focused private equity firm with a total of 4 million members across a portfolio of 5 brands in Canada, the US, and the UK. Notably acquiring Shop.ca in July of last year, EMERGE now owns three of Canada’s largest commerce portals (Buytopia.ca being the third).

WagJag reportedly was quite a popular platform in the GTA, particularly in underserved markets like Hamilton, Kitchener, Niagara, and Mississauga. EMERGE’s acquisition targets tend to fit a profile e-commerce brands with active customer databases, but not enough resources or scale to graduate to the big leagues (along with Shop.ca, Buytopia’s best asset SnapSaves was sold to Groupon in 2014). This is by design: according to CEO Ghassan Halazon, since the company’s launch in 2015, EMERGE has aggressively pursued the acquisition of such assets to integrate and consolidate a portfolio of consumer marketplaces.

“One of the biggest reasons e-commerce companies struggle is because of high customer acquisition costs via inefficient online advertising spend,” Halazon told BetaKit, noting that by pursuing acquisition primarily through customer databases, “EMERGE’s effective CPA is approx. 90% cheaper than the average e-commerce company.”

Halazon also said that EMERGE’s scale allows it to negotiate better pricing across its portfolio, leaving the company profitable two years into operations. The company has also leveraged the scale to close reoccurring advertising partnerships with the likes of McDonald’s, Chrysler, Visa, Nissan, MBNA, Esso, and Cirque Du Soleil.

EMERGE says it plans to accelerate acquisitions in 2018, in both new and existing markets.

Aeman Ansari

Aeman Ansari

Aeman Ansari is a freelance writer who has been published in many Toronto-based publications, including Hazlitt and Torontoist. When she’s not re-watching Hitchcock movies, she’s working on her collection of short fiction inspired by stories from her grandmother, one of the few women in India to receive post-secondary education in English literature at the time.