While Cannes Ad Folks Party, Deals Are Being Done
The noise from the Cannes Lion Festival was deafening this year as the media and advertising industry gathered in sweltering heat to celebrate and ponder the future of a market that is tipped to shortly reach nearly $1 trillion in annual spend.
Perhaps it's the sheer size of a market that has invaded every corner of digital media and content that is increasingly attracting the big money players. The Cannes boardwalks and cabanas were teeming with deal-makers this year, as consolidation, or mergers and acquisitions, look set to be lit on fire again after a relatively quiet norther winter of adtech deals.
Trade publication Digiday reported that Cannes was swamped by investment banks, private equity firms, and hedge funds keen on closing deals. The publication said acquisitions are being sought by "the desire" to maintain audience addressability amid heightened privacy requirements, establishing a beachhead in emerging formate such as CTV or outdoor, and plain old land grabs in new geographical markets. These deals may happen at the end of the year, or in 2025, but some players could not wait. During the show, Verve Group announced it had bough US-market focused Jun Group, a mobile advertising company that operates on the buy-side for around $185 million. Deals could accelerate in the next few weeks if trade press reports prove accurate. Adtech provider Sonobi is seeking to be sold, and follows the recent merger of ShareThrough and Equitiv, a bid to gain a larger stake of the SSP market, and build scale to win more CTV ad spend.
SSP 33Across, said to have revenues just more than $30 million, is also said to be seeking a buyer. The last great consolidation in adtech was around five years ago, shortly after the IPO boom of 2014-2018. This time, the focus will be on snapping up profitable companies that have a solid runway into high-growth areas, such as CTV, retail media networks, cookieless targeting, and/or geographic scale. The ability to build revenue in the face of tighter government regulation will also be vital.
State of the AdTech Industry
As live sandbox testing begins in earnest, some adtech firms are confident of upside for themselves, publishers, and advertisers. Google is also talking up results of cookieless data matching approaches. But the next three months will prove instructive.
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