Verizon's Oath CMO: Consolidation of technology platforms to come

Verizon's Oath CMO: Consolidation of media brands 'inevitable' / Verizon Wireless

Oath, the Verizon-owned media company born from the merger of Yahoo and AOL, has admitted that consolidation of its technology including its advertising platforms is inevitable.

At a press briefing to launch the Oath brand at Cannes Lions, Allie Kline, chief marketing officer for AOL told The Drum that consolidation of the 50 technology brands and platforms under Oath would take place.

"We want to make it easier for people and not harder for people to buy. The volume of brands that we have ... will not be helpful, so you can see consolidation from a brand stand point there," confirmed Kline, but declined to give any further details on which companies would be affected.

When asked about how close the consolidated company was to rivalling the duopoly of Facebook and Google, chief executive Tim Armstrong said that he did not see a competition taking place with them, however he later also claimed that there were only three companies who could claim their scale.

"Our goal is not to directly compete with Google and Facebook. Our goal is to open up real relationships with consumers in a differentiated ways, which will come in two different stages," explained Armstrong.

Stage one is to take scale, assets, data and have a safe and trusted environment to drive the business. Stage two is to include the consumer in a "disruptive way" that builds a two way relationship with the brand.

Armstrong explained the two stages were creating trusted relationships and platforms for brands to advertise across, while he said he thought Oath would be able to deliver a really "safe and trusted audience experience".

He went on to say that the long term competitive advantage for Oath was to become the company that would allow "advertising to become a service" and help build brands across mobile driven devices for consumers.

"The single largest white space that we are focusing on is how do you create a brand in the digital and mobile age. That is so much different to what was happening on the internet 15 or so years ago.

"The future of the internet is really going to be about the consumer and their relationship with the brand and that relationship being two-way."

He said that in stage two a set of products would be released to aid that two-way relationship building.

Asked about reaching the target of $10-$20bn set as part of Oath's strategy alongside reaching 2 billion consumers and involving 10 million creators across its platforms, Armstrong revealed that it would likely take 15% growth to help it meet the lower end of that target but would not reveal further figures.

He described the $20bn target as "very aspirational" and that the revenue element was "essentially built off market statistics of where the industries are going, how fast they are and how big they are growing."

He added that the entire model was based around reaching 2 billion consumers, without which the revenue number "would not materialise", however he believed that the company could reach $10bn organically.

"Above that we have to do extraordinary well," stated Armstrong, who said that it didn't necessarily need to happen through merger and acquisition deals, citing the partnership with Microsoft as a potential investment free model for future deals.

"This is the reality of what we have to do as a business; you see what happen has happened in this space with Amazon buying Whole Foods. The global business of commerce, marketing and media is at an accelerated period right now. Our challenge is that we have to do more than meet the market growth rates.

"We have to take share from the market and that is going to require us very specifically to have an absolute product development life cycle and launch that specially allows us to take market share. We are in a tailwind industry. Money is coming into the industry but the issue is our engines need to fly faster than the tailwind," Armstrong added.

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Stephen Lepitak

Stephen Lepitak is editor of The Drum, with responsibility for overseeing the day-to-day running of the content produced for the various platforms run by the publication. Over the years he has interviewed agency network bosses such as Sir Martin Sorrell, Maurice Lévy and Arthur Sadoun, as well as Cindy Gallop, Kim Kardashian, film directors James Cameron, Spike Jonze, Richard Curtis and Lord David Puttnam. With a keen interest in media and breaking news, Lepitak has been with The Drum since 2005 and is based across its UK, US and Asia operations.

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