Acxiom Acquires LiveRamp, Wants To Build 'Neutral' Audience Grid Anyone Can Plug Into

In a sign of just how important plumbing has become in Madison Avenue’s shift toward data-driven advertising, media and marketing decisions, Big Data’s big daddy, Acxiom, Thursday announced a deal to acquire one of the best plumbers in the business -- data “on-boarder” LiveRamp -- for $310 million. The deal has implications for marketers, agencies and an array of third-party data and data application providers, because Acxiom is betting that frictionless connectivity will enable any and all industry partners to facilitate the exchange of data -- and methods for using it to better understand and target consumers.

“If you believe the future is all about connectivity, then we have to allow our clients to plug into the grid more quickly,” Acxiom CEO Scott Howe tells MediaPost, adding that the goal of the acquisition is to create a neutral “Switzerland-like” state for any client, agent, data or application provider to plug in or out of the grid.

Howe says Acxiom and LiveRamp already have been working together for years, but that the impetus for the merger was the launch of Acxiom’s so-called Audience Operating System (AOS) late last year -- and the fact that clients have been lining up to use it, but have had a difficult time integrating it into their data management systems.

While that’s the primary goal of the acquisition, Howe said another key element is the ability to plug any third-party developer into the AOS so that clients can more easily decide how to apply data processed through the system. When it launched AOS in September, Acxiom included some homegrown apps enabling clients to immediately use it to target audiences more effectively across media, but the goal was always to facilitate an open and neutral marketplace for other developers.

To date, Howe estimates Acxiom has integrated about 30 third-party applications into AOS, and that the integration with LiveRamp will bring another “80 to 100” third-party apps into the system. The more utility that clients, agencies and media can glean from audience data managed through AOS, Howe says, the more value it will create for them, their data and application partners -- and Acxiom, of course.

The initial reaction of Wall Street analysts has been that the deal is a visible public acknowledgement of a “softer-than-expected” ramp-up of AOS and that Acxiom is paying dearly to accelerate that process.

“While we continue to believe that AOS is a great product with unique feature sets, it is one of several platforms that aims to solve similar business challenges for advertisers and publishers,” BMO Capital Markets analyst Daniel Salmon writes in a note to investors, implying that Acxiom is not alone in its pursuit of the apocryphal “Holy Grail” of marketing data integration. Other Big Data players such as Experian and Epsilon have similar pursuits, as does Madison Avenue’s most entrenched plumber, agency data processor Mediaocean. At the same time, a variety of enterprise management players -- everyone from Adobe to Oracle to Salesforce.com -- have aggressively acquired marketing data and service providers to create their own “marketing cloud” solutions, and each of them claim to be neutral, open and eager to integrate other third parties.

“Relative to the other folks in the business who might want to do this, we have no bias coming into this,” says Howe, adding: “We are truly agnostic. We don’t drive people to one marketing stack. We don’t have a media business. We don’t have an agency business.”

In fact, Howe says neutrality has been a long-term mantra of both Acxiom and LiveRamp prior to the deal, and while it won’t close for some time, he and LiveRamp CEO Auren Hoffman have already begun to discuss strategies for accelerating industry acceptance around a neutrality standard, including the possibility of retaining independent auditors to review their systems and processes to “certify neutrality.”

“We’re kicking the idea around,” says Howe, likening the concept to other industry standards, such as the IAB’s online ad format guidelines, which enable competitors and collaborators alike to organize their approaches to the market around a common framework.

“We’re starting to think about what are the standards we’d like to see, can we create a new standard for neutrality,” Howe says, adding that he’s open to other industry players to step forward and collaborate on it.

1 comment about "Acxiom Acquires LiveRamp, Wants To Build 'Neutral' Audience Grid Anyone Can Plug Into".
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  1. Mike Einstein from the Brothers Einstein, May 15, 2014 at 10:18 a.m.

    As ersatz plumber Jerome Horowitz (Curly Howard) would say upon mistaking an electrical conduit for a water pipe: "No wonder the water don't work, the pipes are clogged with wires!"

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