MATT MOBLEY: The classic problem with the technology side in organizations is proper alignment to what the CMO gets measured on. It’s not necessarily something measured by uptime, but more about alignment. It’s a big miss in CIO organizations if they haven’t built marketing skills. If the CMO could go in there and feel like they’re talking to someone who understands ad tech or a DMP, [it would benefit] both sides.
Speaking of DMPs, what are your thoughts? More consolidation?
When the DMP came on the market, it was focused on media to serve display. Now it’s becoming the fulcrum for all sort of digital and interactive where you’ll use data to make a decision. It’s more aligned to how the database marketer thinks and it gets closer to “that’s my new marketing database,” where I [segment] my audience, etc. People are onboarding their offline audiences from those systems and the DMP is the natural location to do that.
A DMP was a natural fit for these larger guys to pull in. We had been saying the DMP market couldn’t last more than five or six years anyway. Epsilon effectively picked up a DMP too in their Conversant buy because they had Dotomi, which wasn’t publisher side, I’m almost positive. That’ll be interesting because Epsilon has a relationship with Adobe and I believe Aggregate Knowledge at one time. I don’t know how it progressed after the Neustar acquisition.
You were an Epsilon guy. Other thoughts on Alliance Data’s acquisition of Conversant for Epsilon?
Epsilon has that product they call Epsilon Agility for identity management, and I see the play there, but that’s not all of Conversant. Conversant has their affiliate network, etc. I wanted to lump it into the Acxiom/LiveRamp acquisition, but it’s not quite the same because that’s not all of Conversant and all the pieces they have. That’s a giant move, though.
You spent time at Acxiom, too.
Acxiom was at $1 billion when I left, or I think they had just crested their billion, and when I got a call from a guy I knew at Acxiom to go to Epsilon, at that time I was in their European business, which was made up of 60% data. When marketing budgets shrink (this was during the recession) what’s the first thing to go? The data buys. So you end up in a pinch on those things.
Acxiom is really rebranding as a “platform” with the Audience Operating System ramp-up.
The AOS side of the house is interesting. From a business standpoint, it was very dangerous for them because they had a billion dollar database and they were totally switching gears to become this platform play…the model is completely different: the way you sell it, monetize it, that’s a big switch for an organization. I think they lost some focus on their database business, but I think AOS as a concept is great. As an application – because they had a notion that they’d have this developer network and everyone would build apps on top of this platform – that hasn’t come to fruition yet. [Some companies are saying] “we heard it was a DMP but it doesn’t have all the audience management function.” I think as they get this first batch of feedback, since it’s been out for about a year now, that’ll change. The team they have in there now – talk about radical change in a company from where they were. They’re very capable.
How are you involved with Merkle’s recent acquisitions: RKG, 5th Finger, Brilig, etc.?
When we were looking at RKG, it was going in and saying, “Where are they collecting and leveraging data?” They have a sizable SEO business and it’s not just SEM. When they’re doing analysis on sites, what actually are they capturing? How does that relate to the bigger scheme of we’re looking at?
The technology teams (at Brilig) report in to my organizations. All the agency technology teams don’t. They tend to be very hyper-focused within search and there’s some crossover between search and display and into the paid social side of the house, but they tend to get very specialized when they’re running operations with the agency.
Can you give a brief breakdown of Merkle’s business units and where your specialty fits in?
Merkle goes to market in verticals. There are about six or seven: financial services, insurance/wealth management, travel, media, entertainment, life science. And then we have four core operating groups. [First], the digital agency services. [Second], the technology solutions group that builds the platforms for our clients. [Third], a quantitative marketing group with about 300 masters or higher statisticians in there. … I think it’s the second largest operating group from a revenue standpoint. In almost every deal we do, even if we just do database, we’ll have some retainer on the analytics side, or it could be on the agency side where we’re helping [clients] navigate attribution and how you align your attribution modeling to your [media mix].
And then the fourth one is our Management Consulting Group. That’s a smaller one. I don’t know if we’ll ever build the next Bain, but as we talk about cross device or cross-channel marketing, typically they have a CRM organization that owns a marketing database that does email and direct mail and they’ve got the digital side of the agency. They don’t quite have that all aligned.
What’s your opinion on developing cross device capabilities? Partner or build your own?
We’re just looking for the partner. We’ve had significant conversations with all the major players like Drawbridge, Tapad, and even the BlueCavas of the world. There are a lot of people who are repackaging the Tapad data product, and they’re really the prominent ones coming into play. Everyone is sort of using their asset as a signal and extending it in some fashion.
It’ll always be a question of reach and how many devices can you see and we’ll always be a partner and connect that into the larger graph.
Publicis acquired Sapient, which also employs a CMTO. Will we see more roles of the like emerge at the holding company level?
Big agencies have to develop or acquire better technology chops. Digital marketing isn’t just about buying media. It is about integrating multiple media into a cohesive program, and in today’s world this is a highly technical effort. Technology also becomes increasingly more important as the addressability of channel and media increases. Everything in marketing is becoming more digital and more technical.
What does the marketing database of tomorrow look like?
The next generation marketing database is this big data marketing database and DMP. Most of our database deals now … we’re putting in a DMP almost in conjunction with those things. The challenge on that side is, when the customer buys the DMP, how do they get their agency to use their DMP asset? And how does it tie to what they want to do, and the process? Because every agency sort of had the DMP thrown in in some form or fashion. So I think that’s one of the bridge areas to bring the CRM guys into the digital world we’re in today.