Why Starcom Mediavest bought into ad tech
The shift to programmatic has left media agencies reliant on outside tech vendors, but few agencies have made big moves to themselves acquire technology.
Publicis Groupe network Starcom MediaVest Group is one that’s taken the plunge, scooping up the 30 person, demand-side platform known as Run six month ago. It comes as Publicis is reorganizing its programmatic strategy, relocating the client services portion of their own programmatic arm, VivaKi, into their family of agencies.
In some ways, the move mirrors WPP’s acquisition of 24/7 Real Media, which it has recast as Xaxis, a programmatic ad buying platform. Agencies do not have a great track record when it comes to owning technology. The old knock is their client services model does not allow them to invest in tech platforms to the degree needed to stay ahead of the curve.
SMG hopes to change that. It now has a patchwork ad tech team, with everything from proprietary technology to a programmatic-specialized account team — all housed beneath a single roof at 1675 Broadway.
“Integration with VivaKi was largely about integrating people,” said Lisa Weinstein, president of global digital, data and analytics at SMG. “It was literally co-locating these people with the SMG teams who had worked with them all along. In truth, it was about time that we are able to bring this talent back into the agencies — we don’t see programmatic as a siloed process anymore.”
Think of the new SMG like a modern, American family in which Run and VivaKi are step siblings. These young companies might not have grown up together, but are now living beneath the same roof — a fact that Seth Hittman, CEO and co-founder of Run, claims is an advantage.
“It was time for programmatic expertise to be married with brand expertise and client relationships,” he said. “And we were drawn to the Publicis’ willingness to align for the future a digital, data-driven agency that brings in technology, because what Run brings to the table is an opportunity to have technology, engineers and software development in-house.”
When combining families, it’s natural to have growing pains — but Marco Bertozzi, president of global clients at VivaKi, insists the Run/VivaKi relationship has been free of major snafus.
“The acquisition of Run was fortuitous. By coinciding the migration of VivaKi’s programmatic services with the arrival of Run’s technology, our teams were able to accelerate the Groupe’s overall programmatic offering,” Bertozzi said.
The Vivaki “operating system” has always been and will continue to be a central point of tech intelligence for the Groupe — building, vetting and verifying new platforms — but let there be no confusion: SMG was in the driver’s seat throughout Run’s entire acquisition process.
“The VivaKi OS is designed to be agnostic in its approach, and to work with any number of industry players,” Bertozzi explained. “And so we felt SMG should maintain ownership of Run, leaving the OS free to work with any number of partners — including Run.”
Run might now be a part of the Publicis family, but there are dozens of provisions in place to allow for the separation of client data inside and outside of the group. This exists both in terms of technology and in terms of manpower. That is to say, the former VivaKi team members who physically log into Run’s self service platform are distinct from Run employees working on non-Publicis clients.
“I don’t foresee any issues for Run [in terms of data privacy]. Agencies and tech companies have long developed “Chinese-wall” strategies for data storing…” said Jay Mendez, founder and CEO of Yieldbot. “I would, however, expect Run will become a Publicis-only platform over time.”
As for now, however, SMG and Run are maintaining some separation. “We physically are sitting within SMG and Mediavest New York, but we still have a level of autonomy,” Hittman explained. “We work with many clients outside the Groupe. We are our own business.”
We know what you’re thinking: The new SMG family has a lot of opportunity for nepotism. But when asked whether there were any sort of financial commitments or minimums for Run, Weinstein responded with an emphatic: “Absolutely not.”
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