A Fox Interactive VP describes how to integrate ad technologies and products post merger or acquisition.
OK, so the same umbrella hangs over different companies-- now how do you integrate?
Whether it was due to the land-grabbing, bigger-is-better fusions of the ‘90s or the leaner-and-meaner survival consolidations of the post-bubble era (or both), if you’ve worked in interactive advertising long enough, you’ve more than likely endured more than one merger. Each of us brings a number of general lessons-learned. Below are some of those lessons focused on the integration of publisher ad systems and operations.
Just as uniting college basketball players recently compiled from distinct high schools requires team building, so does uniting ad traffickers recently joined from distinct companies. And team building starts with getting to know each other. So before digging into differing advertising tools or philosophies, make sure that you have personal connections with your new peers that go a bit deeper than email exchanges. Also, whether you are the acquiring company or the acquired, showing genuine respect for your new corporate cousins will go a long way in building bridges and teams. Only then will you have a chance to create the trust necessary for success. In a dynamic business such as ours, everyone brings something to the table and the experiences of others can provide valuable insights.
As a good “getting-to know you” exercise, begin to get acquainted with the ad technologies and products now in use throughout your recently expanded company. Document and share an inventory of items such as ad servers (primary, rich media, text links, video, mobile, et cetera), ad targeting (geo-, behavioral, registration-based, et cetera), ad sales support and analytics tools. Note whether each tool is a home-grown appliance, vendor-supplied software or hosted by an application service provider (ASP). In each case, measure the strengths and weaknesses of the in-house versus outsourced solutions. Beyond just technologies, evaluate the use of any human subcontracting in areas such as general customer service, ad operations and ad sales.
Now that you are starting to get a sense of all of the tools you now have at your disposal, try to objectively determine the best-of-breed solution in each category. A misconception that the larger or the acquiring company already has the optimal solution will only lead to inaccurate conclusions. Quite often the bigger partner has had the resources to develop solutions beyond the capabilities of others, but you’ll do the newly merged company a disservice if you do not fully evaluate what the smaller players bring to the table. You may find that “small” translates into “scrappy,” “nimble” and “efficient,” and the on-going fight for every nickel of new business and renewals has created superior suites of ad products and operational practices. This will especially be true if the products were designed incorporating the input of leading industry agency and advertiser customers.
Occasionally, there will not be a single “best” solution for each of the parties in the new company. Thus, you’ll also need to look at your inventory and determine which items will best serve the new company as central services and which should remain managed at the individual property level. However, even for the distributed services, continue to leverage these new lines of communications as on-going discussions for best-practices and vendor evaluations will continue to benefit everyone involved. Additionally, with the fluid nature of our business, services that required decentralization at the time of the merger may later produce a benefit from consolidation.
The steps outlined above will help you establish the foundation for long-term, cross-property ad operations success, but, to score some quick points with upper management, I recommend using your new-found girth to renegotiate with your vendors. This will be straightforward for the tools that fall into the central camp, but don’t neglect the decentralized services. As long as you are using some of the same vendors across properties, negotiating as a single entity with those technology providers will result in pricing more favorable than any individual deals. Once pricing has been reset to reflect the superior size of your business, you will be able to include cost savings in your inventory lists and accept a multitude of thanks.
Does it sound pretty easy? Yeah, right! Taking such an approach may help you organize your ad operations as best as possible for a smooth integration, but there may be intangible merger-related issues outside of your control. However, by establishing a firm yet flexible ad systems foundation and showing reverence to your new colleagues, you’ll maximize your odds for success. Good luck and please share your experiences with me!
Michael Stoeckel was named vice president, advertising innovations & operations for Fox Interactive Media in September 2005. Stoeckel concentrates on ad operations, strategic planning and research & development for advertisements sold in conjunction with Fox properties on interactive platforms such as websites, broadband video, mobile, gaming, VOD, DVR and iTV.
Previously, Stoeckel worked for 10 years at Time Warner. He joined Turner Broadcasting System, Inc. in 1998 as vice president, interactive ad systems strategies for internet technologies then moved to vice president, strategic planning and then vice president, emerging ad technologies for Turner platform research & development.