Earlier in April, Publicis Groupe announced an agreement with Alliance Data Systems Corporation to purchase their marketing unit Epsilon, for a price of USD$4.4bn (£3.4bn), making it the largest ever acquisition by the French advertising group, and one of the most substantial purchases of all time within the marketing industry. Full article here.
Data scale is the new game in town
“In a media-buying world that is increasingly dominated by walled gardens and moving towards addressable buying methods at pace, the old holding company model of aggregating media buying scale for cheap pricing is becoming redundant.
“For these businesses to survive in their current guise, this needs to be addressed quickly. But changing the direction of these supertankers would be too slow, so it now needs to be done ‘inorganically’.
“Dentsu were first to market buying up Merkle, followed by IPG and Axciom. So Publicis buying Epsilon is no real surprise, although I can’t comment on the price tag.
“Data scale is the new game in town, but not in the way that the holding companies first envisaged as they aggregated the first-party data of their client base. The reasons for the importance of data are twofold.
“Firstly, in an auction environment, the more data that you hold and can execute on, the larger your advantage over competitors.
“Secondly, in the looming ID wars, holding companies are theoretically well placed to have their own identity graph at scale. This can afford them better targeting, measurement, and integration with supply.
“All the holding companies are taking defensive measures against commoditisation. They are aggressively buying up businesses that have a large offline data asset and trying to translate that to an addressable digital asset to be prepared for challenges to their position.”
Martin Kelly, CEO & Co-founder, Infectious Media