DataXu Doubles Down on Service

DataXu is branching into Europe with the acquisition of fellow demand side platform Mexad. But the move is also a sign of the importance DSPs place on service.

DataXu CEO Mike Baker, when asked why DataXu would need another tech company, pointed out that 35-employee Mexad’s greatest benefit to DataXu is its service component and customer relationships in the United Kingdom, France, Italy, Germany and markets in Latin America.

“We want to be an enterprise technology company,” said Baker. “This is about building out an enterprise services team.”

The not-so-dirty secret about many DSPs is they’re heavily in the services business. They often don’t talk about that part of their business, since as venture-backed companies they want the much higher sales multiple typically tied to scalable tech businesses. Yet for many DSPs, services are the bulk of their business, as agencies rely on them to manage the buying process. In this way, it can be hard to tell how what they’re doing is that different from an ad network.

Baker believes the services bent of many DSPs is tied to the adoption cycle of programmatic buying. Thanks to agency trading desks, the buy side is starting to get more sophisticated with operating DSP technology, he said. It doesn’t mean DSPs will want to become like agencies, although some are heavily involved in providing what certainly look like agency services.

The price of the transaction was not disclosed. Baker said DataXu now has 120 people.

https://digiday.com/?p=2451

More in Media

As Patreon and Substack enter the mix, the livestreaming landscape is dividing creators

Platforms’ livestreaming push has highlighted an underlying divide in the community of livestreaming creators.

Digiday+ Research: Publishers were ready to depend more on first-party data. So, now what?

Publishers were ready for the move away from third-party data: the role of first-party data in generating ad revenue was set to grow significantly, and the percentage of ad impressions served by first-party data was set to increase.

Digiday+ Research Data Sheet: The state of subscription pricing

This infographic details how publishers are approaching subscription pricing and how subscriptions drive other revenue streams for publishers.