The Rundown: Agencies get their hands dirty with data ownership
Last summer, the question of what agency groups will do with data — own it, or rent it — had left Publicis on the back foot. Comments made by the holding company’s leadership post-GDPR indicated the company had no intention of owning its own data.
That was strange, considering that there is a race for “identity” underway in digital advertising that is being accelerated by privacy acts and the GDPR. That race was escalated in the agency realm when IPG acquired Acxiom Marketing Solutions last year for $2 billion, making clear it felt that first-party data ownership was a way for the agency group to shore up its business and its margins.
But Publicis’ $4.4 billion acquisition of Epsilon signals a change of tack. With Epsilon, the French holding group is getting first and third-party data it can sell, via its own consumer data arm.
And with Martin Sorrell’s S4 Capital shopping for a first-party data company and WPP remaining a strong proponent of data ownership, it feels like the major holding companies are now largely on the same page.
So, the question now is whether agencies are prepared to face tough questions about neutrality, and whether they’re selling data to clients because it’s in their clients’ best interests, or the interests of agencies’ bottom lines.
This is exactly what Publicis argued last year around IPG-Acxiom. Publicis Media CEO Steve King had said that Publicis “believes in the power of choice,” and would leave dirty data work to everyone else. “We decided not to own that data. We believe that’s the best interest in our clients, and our focus is on helping our clients grow, but for our sector I think it’s probably a positive thing that IPG has the confidence to make this bold acquisition,” King had said in July.
What a difference a few months makes. — Shareen Pathak
Disney’s best bet is not selling its SVOD, but selling Disney
A lot of attention is going to Disney+ — and rightfully so — as the media giant hopes to build a significant direct-to-consumer streaming video business. And Disney is not meek with its ambitions, targeting 60 million to 90 million global paying subscribers by 2024. Without a doubt, that’s an ambitious target, but it’s important to remember that, for Disney, the ultimate goal is not in selling a subscription video service, but Disney as a brand.
Based on conversations with industry insiders, many expect Disney to bundle Disney+ with other parts of its business. For instance, offering Disney+ for free for a year to those that buy Disney theme park tickets or go on a Disney cruise can go a long way toward building a giant subscriber base. And at $7 per month, the service is also cheap enough where most subscribers (especially families) won’t churn out once those promotional offers end — not when the Disney+ catalog has pretty much every Marvel, Pixar and Disney movie, plus original series and other licensed TV programming.
This doesn’t even account for the possibility of bundling Disney+ with Hulu and ESPN+, something which Disney executives acknowledged last week during their Investor Day. The company did not disclose how those bundles would work, but Disney has the capacity to create a valuable bundle across those three services, covering everything from blockbuster movies to live sports.
Disney+ will be core to Disney’s future. But Disney’s future — just like its business — is much more than getting customers to pay for content; it’s getting customers to pay for Disney, in a variety of different ways. — Sahil Patel
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