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In The New Wave Of Social Marketing M&A, Facebook PMDs Call The Shots

SecondSocialThe participants in a new race to snap up social marketing technology companies aren’t the usual enterprise software suspects. In the latest wave of consolidation, Facebook Strategic Preferred Marketing Developers (PMD) are buying each other.

Search and social software company Kenshoo this week moved in on Adquant, a social ads platform specializing in mobile apps and games.

Similarly, video ad server Mixpo purchased rich media platform and Facebook PMD ShopIgniter to pave its way into paid social. Social media management platform Sprinklr snapped up Dachis Group and TBG Digital and HootSuite grabbed BrightKit to do the same.

“If you look at the simple fact that more media buying is getting disintermediated and going in house, more social planning and execution is going in house, too,” commented Julie Hopkins, research director at Gartner. “What’s driving it is the increased movement by social providers into the paid media space. You require the paid amplification to get the reach you used to get organically.”

To the casual observer, it may seem like some of the smaller PMDs are waving the white flag and understandably so – social is but one rung on a ladder in a wider portfolio of data management and analytics considering enterprise competitors like Adobe Marketing Cloud.

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Adobe's Strong Q3: Marketing Cloud Wins, Uptick in 'Large' Deals

AdobeQ3Adobe's fiscal Q3 was relatively strong as the company reported $290 million in revenue for its Adobe Marketing Cloud portfolio of products, up from the $254.9 million recorded in Q3 last year. Adobe Systems' total revenue was $1 billion in the quarter.

Overall, Adobe Marketing Cloud cited strong customer adoption in the third quarter, counting British Sky, Ford Motor Co., H&M, the US Department of Treasury and Adidas among key client wins.

"It really is in our best interest to manage and deliver the entire customer platform," said Shantanu Narayen, Adobe Systems CEO, during the company's Q3 earnings call.

Although he cited Adobe Campaign (formerly Neolane, the cross-channel campaign tool it bought about a year ago) and Adobe Experience Manager as key drivers for the overall marketing portfolio, "we're seeing an increase in multiyear deployments as well as [selling] more solutions within existing customers," which is leading to increased "stickiness" around the entire cloud portfolio.

Narayen said a combination of factors contributed to the traction this quarter, including an increase in size and volume of transactions, international expansion, growth in partner business, as well as a shift in perpetual to term-based contracts, which indicate larger, multiyear agreements. (more…)


Mobile Player xAd Snags $50M In New Funding, Says It Doesn’t Even Need It

xAdfundingFollowing a $50 million infusion of cash Thursday, mobile location vendor xAd appears to be sitting pretty. The money is a combination of equity and debt financing. XAd is not publicly disclosing the split.

According to CEO Dipanshu Sharma, the company doesn’t “have any immediate plans for the funding,” which came courtesy of Institutional Venture Partners, Emergence Capital, Softbank and Silicon Valley Bank. Although Sharma declined to share the company’s valuation, reportage via VentureWire placed xAd’s worth at about $250 million.

“We have enough self-generated profit to fuel our expenses and product leadership,” Sharma said. “However, we’re continually evaluating strategic acquisitions that have potential to further strengthen our market leadership and global scale.”

Sharma would not comment on specifically what type of companies xAd might acquire down the line. When asked to what extent xAd sees itself as a potential acquisition target itself, Sharma basically said that it doesn't.

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Alibaba’s Q2 Revenue Nearly Doubles Year Over Year On Road To IPO

AlibabaJust days shy of its IPO, Chinese ecommerce giant Alibaba Group reported Q2 revenue of $2.54 billion, a 46.4% increase over last year, while net income skyrocketed to $1.99 billion. The company could raise close to an additional $20 billion out of the IPO based on an average valuation of $168 billion.

In a revised F-1 the company filed Wednesday with the Securities and Exchange Commission, Alibaba also noted positive growth in average mobile monthly active users, which increased from 163 million in March to 188 million at the end of June. Active buyers totaled 279 million, more than double the number last year.

Alibaba makes its money primarily through its Taobao Marketplace and TMall properties, which nearly doubled in gross merchandising volume last quarter to $296 billion with close to a third of that volume coming from mobile.

For the most part, Alibaba’s merchant-driven and the company charges on a fee and commissions basis for online marketing services via the Alimama platform. Alibaba also runs an ad network and exchange business, which is the culmination of a merger between its affiliate network and Taobao Ad Network and Exchange. Cloud computing services, much like Amazon Web Services, is another revenue driver for Alibaba, with that figure now north of $100 million.

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AppNexus Attracts Public Equity Investment, Now Valued At $1.2B

BrianOKelleyThe independent ad tech company that powers more than 30 billion ad impressions per day through its platform is now, officially, a $1 billion-plus business.

AppNexus revealed Monday it has closed a $60 million investment round from an unidentified Boston public equity and asset management firm, valuing the company at about $1.2 billion. At the time of this writing, the company expects up to $40 million in additional financing to follow from “other interested parties” in the coming months, which would make the new investment total nearly $100 million.

The company’s past raises have totaled $140 million. AppNexus has also increased its debt facility to $75 million, extendable to $100 million.

Rather than riding the ad tech IPO train and weathering the ups and downs of Wall Street, for now co-founder and CEO Brian O’Kelley said the public equity financing will give AppNexus the currency it needs for future M&A, to “aggressively” ramp up on engineering talent and further global expansion.

He spoke with AdExchanger about the deal and ad tech investment landscape at large.

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Facebook, LinkedIn Ads Partner AdStage Picks Up $6.25M

AdStageAdStage, a cross-platform campaign automation tool as well as a Facebook and LinkedIn ads API partner, has raised $6.25 million in Series A financing from Verizon Ventures and myriad other investment firms.

This brings the company to $8.78 million in total funding since its founding less than two years ago. AdStage will predominantly use the new injection to add to its headcount – the San Francisco-based startup now has 17 employees (of which 11 are engineers) and plans to grow to 25 in the months to come.

AdStage is an entirely SaaS-based product and launched initially an “AdStage Express” version of its platform, which “allowed advertisers to build a one-campaign template that would propagate into the four networks we supported – Facebook, Google, Bing and LinkedIn,” according to Sahil Jain, cofounder and CEO of AdStage.

It also released a more advanced product, called AdStage Platform, designed to allow marketers to centrally build and deploy campaigns across multiple ad networks, he said. The funding will also be used for product development, such as a new “Automated Rules” feature for automated bidding, budgeting and day parting for cross-network campaigns.

“Realistically, consolidation is the next step for this (ad tech) space, so we wanted to bring everything that’s useful for an advertiser under one roof and look at it as a workflow solution with third-party integrations,” Jain added.

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Dentsu Sees Q2 Revenue Increase From Client Wins, World Cup Advertising

dentsuDentsu reported steady quarterly earnings Tuesday both in Japan and abroad. The Japanese holding company saw Q2 revenue rise to $1.3 billion, a 9.8% increase YoY.

The company saw 10.6% organic growth in Europe, the Middle East and Africa, 4.7% in the Americas and 14.8% in Asia-Pacific.

The modest growth was driven by new client wins within the Dentsu Aegis Network and a boost in advertising revenue, aided in part by the FIFA World Cup.

Income from advertising hit about $5 billion, a 4.8% increase from the same period last year. Television beat out all other Dentsu business-sector categories by a landslide, at 51.4% of total business. Creative business came in second, at 13%.

Although interactive media only accounted for 4.6% of total business, the sector saw the highest percentage of growth – an impressive 19.3% YoY and a potential signal of the ad world’s digital evolution.
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Q2: Millennial Media Still Can’t Catch A Break, But It’s Looking To Programmatic As The Panacea

millennialmediaIt ain’t easy being a standalone mobile ad network/exchange these days, especially with Facebook, Google and Twitter breathing down your neck — and Millennial Media is feeling the burn.

While Millennial reported $67.3 million in revenue in Q2, up 18% from the same time last year, the number needs to be taken with a grain of salt. Millennial also posted a net loss of $15.1 million in Q2, compared to its $3.1 million loss in Q2 2013. The Q3 2014 outlook is also less than stellar, with revenue forecasts of between $65 million and $70 million, a projected loss of around $7 million or $8 million.

It’s been an uphill battle for Millennial Media. Company stock has fallen precipitously since the company’s IPO in March 2012.

But really, fair enough — Q2 is only CEO Michael Barrett’s first full quarter at Millennial, and he’s more than aware that he has his work cut out for him.

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Sizmek Posts Not-So-Sizable Q2, Buffs Up On Mobile With Aerify Media Acquisition

sizmek 02Sizmek’s Q2 2014 revenues disappointed, with a meek 7% YoY increase to $44 million. In addition, the company said it had acquired Aerify Media for $6.25 million in cash (not reflected in Q2 revenue).

First, the revenues: Despite double-digit growth in LATAM and EMEA, Sizmek struggled due to what CEO Neil Nguyen singled out as “lower-than-expected performance in North America and Asia Pacific.”

APAC performance, down 12% YoY, was “the weakest geography by far this quarter.” This represents Sizmek's first loss in the region in 10 quarters, said Nguyen, who theorized that the slowdown occurred because of reduced advertising from airlines in light of the two Malaysia Airlines tragedies.

The problem in North America was due to stagnation in rich media on desktops, as most clients focused investments in video and mobile.

“We’re being conservative and expect little to modest recovery of those key areas as we look at the full year,” Nguyen said.

Sizmek updated its full-year expectations, anticipating a 12-17% revenue increase.
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Marin's Revenues Display Growth

marinMarin Software’s net revenues are up at $23.9 million for Q2, a 31% YoY increase. The company served 776 active advertisers this quarter, with 13 coming from newly acquired Perfect Audience. The total was up 192 advertisers from Q2 2013, a 33% YoY increase.

CEO David Yovanno, who just completed his first quarter as CEO, touted the company’s expansion into display advertising via new products and acquisitions.

Marin has prioritized expansion into display advertising and real-time bidding, hoping to lose its search-oriented reputation. This initiative includes social advertising, which yielded “modest” revenue contributions in Q2.

“We believe we are bringing a disruptive new model into the display and social retargeting space,” Yovanno said.

He highlighted the company’s acquisition of San Francisco-based Perfect Audience, which offers advertisers a SaaS platform to retarget audiences across the web, Facebook and Twitter.

The acquisition allowed Marin to add new programmatic display and social advertising functions while enhancing its audience targeting tools, broadening the company’s cross-channel capabilities.
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