Neustar Marketing Revenue Up, But Below Expectations Due To MarketShare ‘Shortfalls’

neustarAlthough Neustar’s marketing services division saw 54% Q3 revenue growth YoY to $63.3 million, CEO Lisa Hook noted Thursday that new client wins in its marketing analytics business, MarketShare, had fallen short.

As a result, the company lowered MarketShare’s full-year revenue guidance for 2016 from $70 million to $55 million-$60 million.

“Our overall results for the third quarter came in below our expectations,” Hook said during the earnings call Thursday. “We are acting with focus and urgency to strengthen our sales and marketing execution and to get these logo acquisitions back on track.”

MarketShare lost potential deals to other providers that offered “dramatically lower pricing,” Hook said, but added there were instances where would-be clients tried out competitive solutions and then returned to Neustar.

Consequently, Neustar is revamping its go-to-market strategy for marketing and sales enablement. It also hired a new CRO, Nick Hulse, and plans to ramp up hiring for solution sales executives.

“We remain highly confident that our information services strategy is sound and that we have built formidable competitive advantages,” Hook said. “Our thesis for acquiring MarketShare remains intact.”

On a higher note, Hook heralded Neustar’s strategic footprint, including its OneID product, which connects identities across Neustar solutions, and its relationship with Facebook. Neustar was one of the first to integrate with Facebook’s measurement solution and ad server, ATLAS.

Hook noted Neustar entered into “an advanced attribution partnership with Facebook” in September to connect online ads to purchases.

Neustar claims it’s unique because it supplies both attribution and marketing mix optimization within a single system.

Finally, Hook addressed Neustar’s planned split into two publicly traded companies: information services (which includes marketing) and routing. Advisers are helping the company with the process, which is expected to unfold over the next few months.

Neustar will provide updated financial details for both companies during the first quarter of 2017, Hook said.

 

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