Financial service clients are
cutting back and less established clients are moving on, but data measurement powerhouse comScore is still well-positioned to weather the economic downturn, according to Co-founder/CEO Dr. Magid
Abraham.
"Everybody knows that this is a tough economy, but our long-term growth drivers remain intact," Abraham said Monday during a presentation at the Deutsche Bank 2009 Media
and Telecom Conference in Palm Beach, Fla.
Overall, financial service clients represent about 4% of comScore's business--split evenly between investment banks and commercial banks--according to
Abraham. "We're only exposed that much," he said.
Still, the economy is impacting comScore's bottom line in other areas. Clients, for one, are now more watchful of their discretionary spending
budgets, while customer churn--or the rate at which comScore loses clients--is on the rise.
What's more, the rate at which comScore can "upsell" clients--or convince them to spend more with the
company--has slowed. "It's in the range of 2-to-3% ... lower than normal," said Abraham.
Why? Not only is there less money to go around, but the approval process for new products is more
complicated in a downturn, according to Abraham.
Despite such challenges, comScore is still projecting 15% growth in revenue this year. For those unforeseen challenges, the company also has about
$75 million in cash, said Abraham.
In the fourth quarter, revenue at comScore was up 25% to $31.6 million compared with $25.3 million during the same period in 2007. Subscription revenue,
meanwhile, increased 32% from the same quarter the previous year. Overall, full-year 2008 revenue grew 35% to $117.4 million compared with $87 million in 2007.
Revenue for the quarter was
slightly below guidance, which the company attributed to the negative impact of the stronger U.S. dollar on international revenue, and a slower rate of international growth.
Despite the economic
conditions, comScore increased its customer base by 30 in the fourth quarter, hitting a total of 1,166 clients.