Verizon’s acquisition of AOL will create a media and ad tech powerhouse which can take on the likes of Google, Facebook, Netflix and Amazon, and will help fortify it against the rise in ad blocking, according to AOL’s chief marketing officer (CMO) Allie Kline.
Speaking to The Drum at Cannes Lions International Festival of Creativity, Kline said that the acquisition, which closed today (23 June), will give it the financial stability required to compete fiercely with the other media tech giants.
“We have laid a foundation to be extremely competitive with Google and Facebook. We have had to pick and choose more what we have prioritised because we weren’t of the size of Google and Facebook. So this acquisition gives us all the backing we need to go aggressively after the aims that we set,” she said.
These aims will include “deep investment” in both content and ad tech investment across all its properties. “Netflix has been killing it with its original programming, which has been so successful. But what it has not been able to do – nor Amazon frankly – is bring the two together. For a while we have been deeply invested in platforms and automation and in premium original content, and we would like to bring the first to bring those things together. Netflix doesn’t offer a great model for brands to tap into, neither does Amazon at this point. And Google doesn’t offer a lot of premium video content to tap into, so we think we can really shoot the gap in between those two,” she added.
Competition has become increasingly fierce in the ad tech and media landscape over the last year and Kline predicted that the next 18 months will see a “dropping out” of companies that don’t have a strong premium content offer or ad tech offer. “A trend in the market right now is that everything caught in the middle is dropping out. So either I’m a premium content provider or an ads provider – or both. Anything on the fringe with an arbitrage model of just repping other people’s inventory, is going to fall by the wayside. There are a lot of companies that still survive on being able to buy inventory at the last click and sell that inventory. That will fade away. “
She added that ad blockers will be a “massive catalyst” to this and that publishers may face an “uncomfortable” transition period should they choose to adopt ad blocking software, which could lead to an increase in subscription-based models being adopted.
However, she said ultimately the ad blocking debate “will turn into an attribution opportunity for tech companies”.
Meanwhile she revealed scepticism on the effectiveness of ad viewabilty as a metric, rather referring to it as a “step function to the real metric, which is attribution.”
“Viewability is the measure of whether someone has seen an ad but that is like table stakes – of course they should see my ad. What I really want to know is how impactful my ad is and whether it will really drive results. And the ad blocking debate will turn into an attribution opportunity for tech companies,” she added.
The Verizon deal is expected to close imminently, and once it does the two companies will go into “deep planning mode” across the teams as they outline future synergies, according to Kline.
“Verizon is the largest wireless provider in the US, and the innovation they are working on – I had no idea how deep the investment they had made there. It is really exciting for us as we look ahead to knew platforms, and everything from the OTT work we had been doing that we had been doing. And Verizon’s 1.5 billion devices will accelerate that. When we think about our investments in original content and programming, and Verizon’s partnerships with things like the NBA and NFL – this [acquisition] will super charge that. So we see a ton of opportunity.”
Marketing activity will ramp up in the coming months as it prepares to run more consumer marketing that it ever has previously. This will see it look to tie together the content brands which include Huffington Post, TechCrunch and Makers Studios, with the rest of its proposition to create a streamline message to consumers.
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