Ginger May PR Agency Logo Plain

The Thriving State of Adtech

Author:

Victoria Usher

Published On:

October 21, 2016

Published In:

Advertising & Marketing

The start of 2016 heralded gloomy prophecies for the advertising technology market. Growth appeared to be slackening as the optimism that kept the sector buoyant gave way to general scepticism, VCs completed far fewer deals with adtech companies – dropping from 251 in 2014 to 127 in 2015 – and overall investment in the market declined. The value of public adtech company stocks also plummeted and several high-profile adtech businesses made cuts to their workforce.

chart

Yet from where we’re standing in the last quarter of 2016, it’s a very different story.

The UK programmatic display ad market grew 44% this year to reach £2.67 billion, making it clear adtech is still a thriving market. It may be maturing and evolving but its bubble certainly hasn’t burst.

In a keynote speech at ATS London 2016, Julie Langley of Results International explained adtech is still an attractive high-growth market with a wealth of opportunity ahead of it, and has simply experienced the downturn every disruptive technology industry faces at some point in its evolution.

Despite a dip in company valuations there is funding still available for those start-up businesses with a differentiated offering, and M&A activity within the adtech market is very strong with plenty of buyers having a strategic interest in the sector. These buyers include marketing services businesses building out their stacks, traditional media companies such as broadcasters taking control of monetisation, telcos making use of their valuable subscriber data through high value acquisitions, and new entrants from the Asian markets trying to get a foothold in the adtech sector. Many acquisitions are the result of existing partnerships where the purchaser is confident of synergies between the two companies and fully understands the value of the business they are acquiring.

Over the last year GingerMay PR has witnessed a wealth of M&A activity in the sector first hand, involving the acquisition of around a quarter of our client base – some of which are outlined below. This illustrates not only that our global PR agency is an effective accelerator of successful businesses that attract high profile buyers, but also that the ad tech market is as prosperous and dynamic as ever.

At the end of 2015 The Exchange Lab and its proprietary technology Proteus was acquired by WPP’s GroupM to expand its programmatic capabilities. This was followed by the acquisition of leading video supply side platform StickyADS.tv by Comcast to create a business capable of exploring opportunities within the new TV ecosystem.

Other examples include anti-fraud firm Forensiq, which was acquired by digital marketing business Impact Radius to enhance its machine learning technologies and bring fraud detection in-house, as well as Sizmek, which was bought by private equity firm Vector Capital, providing the adtech company with the means to fulfil its long-term goal of becoming the industry’s leading independent, global ad management platform. And earlier this month, we saw the purchase of HookLogic – along with its brand advertising exchange – by performance marketing technology company Criteo.

In spite of the gloomy outlook at the start of the year, the road ahead looks promising. Adtech’s future will inevitably involve the much talked about merger with martech as the distinctions between the two become ever more blurred, and in an industry that evolves as rapidly as adtech, emerging technology developments and transformative innovations are sure to be just around the corner. From our front row vantage point the progression of the adtech industry is a very exciting story to be a part of.

Why I took GingerMay on the B Corp™ journey

Why I took GingerMay on the B Corp™ journey It has always...

The AI innovations progressing industrial decarbonisation

The AI innovations progressing industrial decarbonisation...

What is the goal of integrated communication in B2B tech?

What is the goal of integrated communication in B2B tech?...