Publicis And Epsilon: An Acquisition Of Legacies?

Big news: Publicis is buying Epsilon for $4.4B to bolster its first-party data (audience targeting) capabilities. This is the largest acquisition ever for Publicis since being founded in 1926.

Why this matters: The future of advertising is audience targeted and holding companies such as Publicis are playing catch up through acquisitions.

Recent purchases of data firms by holding companies:
1)
Merkle → Dentsu (2016 — $1.5B)
2) Acxiom Marketing Solutions → IPG (2018 — $2.3B)
3) Epsilon → Publicis (2019 — $4.4B)

What others are saying: Maja Milicevic @ Sparrow Advisers argues that little is unique from this acquisition because the brands own their first-party data as opposed to Epsilon.

Quote from Jay Stocki — COO @ Signal:
“They had to do this. They were the last big holding company that didn’t have a strong data play.”

Key details for Epsilon:
1)
$2.2B revenue in 2018
2) 8K employees
3) 70 offices
4) 71B
personalized emails sent in 2018
5) 250M U.S. adults in database
6) 7K different attributes

More #1: The Rundown: Agencies get their hands dirty with data ownership

More #2: What First-Party Data Does Epsilon Actually Have?

More #3: Q&A: Publicis Groupe CEO Arthur Sadoun on Epsilon acquisition

Turner is using AT&T’s subscriber data to sell targeted TV ads with Xandr

Big news: Turner ad inventory is now being targeted with AT&T subscriber data (mobile and pay-TV) for more targeted advertising and improved post-campaign measurement. This was discussed as a major benefit of AT&T’s purchase of Warner Media last year.

Quote from Donna Speciale — President of Ad Sales @ Turner:
“I have been a little disappointed in the adoption in the audience area, and this, to me, is going to really help create and speed up the adoption because I think clients are now going to see a lot more results of what audience buying can do for their business, especially using the AT&T data, and really start driving business outcomes for them,”

Share of Turner ad inventory that is audience targeted:
1)
Currently — 5%
2)
Goal — 20–30%

AT&T has 170M customers in aggregate between mobile and pay-tv.

The pay-tv footprint is ≈ 40M individual set-top-boxes across 25M households.

The big question: Can AT&T get other companies that they compete with to combine inventory and audience data into a single system?

The challenge: Networks like NBCUniversal, Turner and Viacom have already rolled out their own platforms.

Current audience targeting platforms:
1)
NBCUniversal (Open A.P.) → Fox, Viacom, Turner and NBCUniversal
2) Turner (AudienceNow) → Turner
3) Viacom (Vantage) → Fox and Viacom

Quote from David Campanelli– Co-Chief Investment Officer @ Horizon Media:
“You need everyone… Even if it’s three quarters of the marketplace and you still have a quarter of the marketplace that’s not connected, it’s still hard for the agencies. At the end of the day, they’re competitors, and I can’t envision a report from Open A.P. saying, ‘Viacom worked, Turner didn’t,’ and Turner being OK with that.”

More #1: Here’s how AT&T’s Xandr and Turner plan to work together in 2019

More #2: 5 things we learned about AT&T’s media and advertising business in 2018

More #3: Xandr’s Amy Leifer on Operating in an Advanced TV Ecosystem

Who Will Buy LiveRamp? A List Of Favorites, And Dark Horses

Big news: IPG has acquired Acxiom’s Marketing Solutions (AMS) group for $2.3B.

What does AMS do? AMS is a data services and analytics company with data on 2B+ consumers.

Quote from Diaz Nesamoney –CEO @ Jivox:
“AMS, like many data providers, gets data from retail partners, public government records, surveys, websites, apps and data aggregators. The data comes from consumers who have allowed this data to be collected and used for marketing and personalization purposes.”


TBD: LiveRamp was not included in the sale and will now publicly trade under the ticker RAMP. The big question is if they will also be acquired by another company.

The top contenders for LiveRamp:
1) Oracle
2) Adobe
3) AT&T
4) SalesForce
5) Private Equity

Important: AMS sold for 40% above BMO Capital Market’s valuation of the business! Many believe that LiveRamp would see that same type of premium.

Flashback: As Television Gets More Digital, TV Advertising Needs To Follow Suit


More #1: IPG Makes A $2 Billion Bet On Data With Acxiom Marketing Solutions

More #2: Acxiom sells Marketing Solutions division to Interpublic, readies LiveRamp

More #3: Acxiom’s LiveRamp inks deal with Sonobi as sale rumors swirl

Fox TV taps WideOrbit for open programmatic ad sales marketplace

Fox will make inventory from 28 stations in 17 markets available through WideOrbit.

These stations currently reach 37% of U.S. television homes.

Quote from Rick Ducey — Managing Director @ BIA/Kelsey.
“When you step back and examine the possibilities, any movement of local TV toward programmatic buying and selling will significantly impact the amount of spending and could win more spending that might have gone to digital.”

Local TV advertising evolving into a programmatic sales environment is a huge development that does not get a ton of coverage.

The local TV advertising market was estimated at $20.6b in 2016.

Pandora Taps Neustar To Build New CRM

Buying ads targeted directly to customer data (CRM) is coming to another major platform.

Neustar will be the onboarding partner.

What does this mean for advertisers?
1) More platforms will offer ad buying targeted directly to customer data.
2) The number of platforms/tools/vendors to accomplish this is going to grow to make execution more complex.
 
More on this topic. Podcast: Resolving LiveRamp’s Identity

Targeting Is Programmatic TV’s Killer App

Key findings on programmatic TV from a survey conducted by Adobe:
1) 28% of decision-makers plan to increase amount of $ going to programmatic TV

2) 62% of above group are increasing $ to reach more targeted audience

Previously on SOTS. Unpacking Omar Sheikh’s $100B Call On Future Of Data-Targeted TV Ads

Quote from Omar Sheikh — Analyst @ Credit Suisse.
“Investors continue to regard U.S TV advertising as a structurally declining business, driven by erosion in viewing and competition from the growing reach of digital platforms,” Sheikh said. “In our view, if the TV industry can combine its reach with greater relevance by using technology to improve targeting, the medium will be well-placed to grow its share of the marketing mix over time. This will particularly be driven by below-the-line items, including direct mail and telephone marketing, which account for more than $100 billion of spend today.”

Previously on SOTS. Fox TV taps WideOrbit for open programmatic ad sales marketplace

Quote from Rick Ducey — Managing Director @ BIA/Kelsey.
“When you step back and examine the possibilities, any movement of local TV toward programmatic buying and selling will significantly impact the amount of spending and could win more spending that might have gone to digital.”

More on this topic. Research: Majority of TV Networks Not Streamlined to Sell TV and Video Ads Together


Nielsen announces Comcast agreement to incorporate set-top box data for local TV audience…

Nielsen will begin including set-top-box data from Comcast in its local TV ratings.

Why is this a big deal? Comcast has 23m cable subscribersand Nielsen is the only measurement provider with access to that data.

The map below shows the markets where Comcast currently has coverage.


Audience buying on TV is a $100b+ market and these types of deals should only accelerate that.

Previously on SOTS. Fox TV taps WideOrbit for open programmatic ad sales marketplace

Quote from Rick Ducey — Managing Director @ BIA/Kelsey.
“When you step back and examine the possibilities, any movement of local TV toward programmatic buying and selling will significantly impact the amount of spending and could win more spending that might have gone to digital.”

Programmatic TV Player WideOrbit Now On 1,000+ TV Stations

WideOrbit’s programmatic platform (WO Programmatic) for local TV has surpassed 1,000 stations.

Key stats for coverage:
1) Markets — 181 (including top 50)
2) Reach — 96% of U.S. households

Quote from Nick Waller — EVP and Co-COO @ Gray Television.
“It’s a tipping point for the local TV industry to have the vast majority of stations now offering inventory with programmatic platforms. We are optimistic that achieving critical mass will make our inventory more attractive to agencies looking for an efficient way to purchase broadcast TV at scale and to advertisers that want to supplement digital media campaigns with TV’s superior reach and impact.”

Publicis recently announced plans to place $50m of advertising for an undisclosed quick service restaurant using WO Programmatic.

Flashback. Fox TV taps WideOrbit for open programmatic ad sales marketplace

Quote from Rick Ducey — Managing Director @ BIA/Kelsey.
“When you step back and examine the possibilities, any movement of local TV toward programmatic buying and selling will significantly impact the amount of spending and could win more spending that might have gone to digital.”

More. Research: Majority of TV Networks Not Streamlined to Sell TV and Video Ads Together