How Giphy's $300 Million Search Engine Platform Could Be the Key to Your Marketing Strategy

Adam Leibsohn, co-founder and COO at Giphy.

CREDIT: Getty Images

Whenever Adam Leibsohn would receive a "page-long" text message from his mother, he'd simply ignore it. Then he realized there was a better way to communicate, by sending animated images--or GIFs, as we now call them--based on relatable references to classic TV shows (i.e., early episodes of The Oprah Winfrey Show).

Leibsohn is now the co-founder and chief operating officer at Giphy, a search engine for visual media. GIFs (pronounced with a hard g) aren't just popular among the Millennial generation. Speaking at the Northside Festival in Brooklyn on Tuesday morning, Leibsohn argued that the method of communication is equal to, if not more powerful than, verbal language.

"They [GIFs] are a Venn diagram of expression and culture," he said. "It's how we see the world around us. It speaks to something in our DNA, and it happens to be the best way to communicate visually. We've found out a way to squeeze these things into tubes and run them all over the world, and straight into our phones."

Leibsohn's startup, which he launched in 2013 with Alex Chung and Jace Cooke, is growing rapidly. To date, the company has served more than half a trillion GIFs based on references to movies, television, sports, music, politics, and more. (Leibsohn says Giphy has struck deals with most major television networks and sports leagues, as well as political groups including the GOP and the DNC.)

Though the startup has yet to see any revenue, it gets roughly 160 million unique viewers per month. In February of this year, Giphy raised an additional $50 million in venture capital funding, bringing its total capital raised to more than $78 million, for a reported $300 million valuation. 

While Giphy hasn't disclosed how it plans to generate sales, it's not unreasonable to assume it would do so through advertisements, much in the way that Google does.

"Our core experience is search," said Leibsohn. "We're a search engine powering Facebook, Twitter, and Slack, with a lot more coming. If you look around the world, there are other search engines, and they make money in some pretty obvious ways," he added. "You can probably draw a connection."

Of course, at just 52 employees, with offices in New York City and a studio in Los Angeles, it's premature to be comparing Giphy to global players. Still, it's worth pointing out that the company reaches billions of eyeballs, and largely Millennials'. That's an attractive offering to brands hoping to harness the generation's roughly $200 billion spending power.  

"If you think of GIFs as language, and language is just a series of thoughts and concepts, then you [as a brand] can make thoughts and concepts that adhere to your brand guidelines," Leibsohn explains. "The exposure is authentic. It's the marketing you could never buy." 

Giphy works directly with a number of companies to generate promotional content, including HBO. It also licenses out its API (application programming interface) to businesses for free, most recently to apps that provide learning tools to students with autism.

"Linear stories and linear plot lines really give children with autism a lot of anxiety, because if they miss something, they feel like they can't get it back again," Leibsohn said. "But because the GIF loops, because it's small and compact, there's no fear of missing the point. Now they're learning more."

As with all marketing, brands need to be sensitive when using GIFs, since not all content is tonally appropriate. Consider that earlier this year, Google upset many users when it integrated a GIF of a minion dropping a microphone into its email function as an April fool's joke (which some pressed accidentally, on messages containing sensitive content.)

"It's just a matter of finding the right visual for the thing you're trying to express," advises Leibsohn. "You can be serious, you can be truthful, and you can be factual in GIF format." 

Consider, too, that GIFs may communicate to a more visually oriented customer or client. "We've conflated literacy for intelligence," Leibsohn added. "Just because you can read doesn't mean you're smart, and just because you can't read doesn't mean you're stupid. These aren't apples to apples. It [the GIF] might in some instances be better for people who are really smart but can't communicate verbally very well."

Source: How Giphy's $300 Million Search Engine Platform Could Be the Key to Your Marketing Strategy