Xaxis grew its revenue by 28% during the first quarter, said Pivotal Research Analyst Brian Wieser in a research note. WPP had previously stated the business had 2012 media billings of $270 million and a headcount of 200.
The healthy growth rate is in line with at least one other agency trading desk (Interpublic Group's Cadreon grew about 28% in North America last year, AdExchanger hears) and suggests trading desks – two of them, anyway – are humming along even while enduring pushback from some clients.
Wieser said in his note, "We see trading contributing to the increased reliance that most marketers place on agencies given the balanced application of technology integration, best practices and talent agency trading desks can apply."
Xaxis fits into an overarching WPP strategy of becoming a platform partner to advertisers in an age when CIO and CMO budgets increasingly overlap and clients want to simplify their technology approach.
CEO Martin Sorrell told investors on Friday that WPP has acted historically as the marketing partner working alongside a vendor such as IBM. That changed significantly circa 2007, when the company acquired 24/7 Media. More recently it took a 20% stake in South American technology firm Globant. The strategy is to get closer to CIOs, who control marketing budgets in an age where software is a growing piece of the advertising equation.
"We're increasingly getting knowledge of the technology side on our own," Sorrell said. "Xaxis is a very good example on the media planning and buying side online."
Sorrell added WPP's fourth largest client has recently commissioned the company to "put a complete platform in." He didn't elaborate on the nature of the project or what "complete" means in this instance, but WPP's seriousness about its platform strategy is clear.
As Sorrell told AdExchanger in January, the company is going after "the Sapients and the Cognizants."
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