Publicis Groupe has agreed to acquire data collaboration platform LiveRamp in a $2.2 billion deal. Analysts have broadly welcomed the move as a logical next step that could also benefit Publicis’ principal media offering.
LiveRamp connects more than 25,000 publisher domains and 500 technology and data partners across 14 markets, serving as the plumbing that enables thousands of brands, retailers, media platforms and data providers to connect, unify and activate data across the digital ecosystem.
It has 830 clients largely in the US, including 25 per cent of the Fortune 500, and has delivered double-digit CAGR growth for the past five years.
The French advertising group’s acquisition of LiveRamp comes at a time when advertising holding companies are scrambling to enhance their push into data, AI and technology solutions in marketing.
In January, Publicis forged a strategic partnership with LiveRamp, while it recently acquired data management platform Lotame and Epsilon (for $4.4 billion) in 2019.
Publicis chief executive Arthur Sadoun said that the addition of LiveRamp would enable the holding company to become a “leader in data co-creation to fuel more intelligent agents for our clients to thrive in this AI world”.
“By building the future of data co-creation, we’re empowering our clients to generate new, exclusive and proprietary data, to build the smartest, most differentiated AI agents on top of the leading LLMs,” Sadoun added — see his full comments in the video below.
“It will be valuable for our clients’ business growth, and a new addressable market for Publicis.”
One benefit, according to Publicis, is that it will allow data collaboration with greater speed, security and scale.
For example, a bank could build a wealth management lifecycle agent that could use customer data from its retail banking, credit card and wealth management and partner data from merchants, payment networks and travel providers to cross-sell products to its customers faster.
LiveRamp chief executive Scott Howe will continue to lead the business post acquisition, reporting to Sadoun.
“Our customers and partners have always been our North Star, and by joining forces with Publicis, we will have greater resources and flexibility to scale our business, continue innovating our platform, and help them unlock even greater value from their data,” Howe said.
The business will be structured in Publicis Groupe’s technology division alongside Publicis Sapient.
Logical next step or ‘response to WPPs Infosum’?
Industry analysts have broadly welcomed the deal but not all for the same reason.
One US source, who spoke to B&T anonymously, said that Publicis’ move could be due to a rival lifting its game and starting to gain traction.
“The word in the US is that this acquisition could be in direct response to a string of WPP business wins in North America, under its WPP Open proposition, and Publicis being nervous that a lot of them have been anchored around Infosum,” the source said.
“WPP Open has become more sophisticated with a combined platform across media; the planning tool wasn’t very sophisticated 2-3 years ago, but the rearchitecting under Brian Lesser has made it a much stronger proposition.”
Publicis Groupe recently won the North American media account of Coca-Cola, but has provided a compelling proposition for new business success in markets such as Australia, where it has recently won clients including Suncorp Group, Nestle and BYD.
Leading US analysts Madison and Wall, which is led by Brian Wieser, believes the LiveRamp deal’s strategic logic is clear.
“We have analysed the agency AI offerings that are in the marketplace, and they are remarkably similar,” Madison and Wall wrote in a note to investors.
“Most clients are unlikely to distinguish them based on functionality alone. That makes proprietary data assets, identity infrastructure, and technology integrations more important as sales differentiators. In that context, LiveRamp gives Publicis another powerful layer of data connectivity to integrate into its broader platform.”
Publicis clients should benefit from tighter integration between LiveRamp and Epsilon and with the addition of Lotame could become a differentiator in new business pitches, client retention discussions and principal media models, Madison and Wall added.
“The ability to connect advertisers’ first-party data, resolve identity, match audiences, activate segments, and measure outcomes can help transform otherwise commoditised inventory into something agencies can package, price, and sell with a stronger performance narrative,” the investor note said, adding that LiveRamp’s ongoing value could depend on its neutrality post acquisition.
The deal is expected to close before the end of the year subject to shareholders and regulatory approval.
