Mediaplex Out of Media Business
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Marketing technology and Web media buying firm Mediaplex aims to stem its losses from the current stagnant ad spending market by exiting the media business.
According to terms of a three-year agreement, interactive agency Exile On Seventh will take over the media services portion of San Francisco-based Mediaplex's business -- which includes media planning and buying and ROI analysis. Exile also lands the group's client roster, and some of its employees.
Through the arrangement, of which financial terms were not disclosed, Exile also agrees to use Mediaplex's MOJO as its exclusive ad serving technology. Mediaplex' Louisville-based AdWare subsidiary also will provide technology for Exile's use in offline campaign planning, production and financial management, as the agency's preferred provider.
Mediaplex has been planning such a move for some time. During the company's most recent earnings call, chairman and founder Greg Raifman (who then held the title of chief executive as well) said the company was renewing its effort to focus on a more technology-centric business model, away "from lower-margin media revenues."
New CEO Tom Vadnais' appointment to the top post at the firm also signaled the transition: before joining the firm, he held a number of positions at software and professional services companies, including IBM.
"With this agreement, Mediaplex can fully concentrate on continuing the development and expansion of technology systems for agencies and the Fortune 1000 marketing departments in the areas of online and offline media planning, campaign execution and cost management systems," said Vadnais, who also holds the post of president.
"When Mediaplex started in the early days of the Internet, providing interactive media services was essential for market acceptance and product development efforts," he added. "Our experience in interactive media has furthered our understanding of the technology, which is now our complete focus."
The sale of the media unit also entailed the cutting of about 20 percent of Mediaplex's workforce, or 45 positions. It is not known how many of that number, if any, will join Exile.
Other Web ad plays like DoubleClick and Engage and others have been similarly busy reducing their exposure to soft media revenues by building the technology portions of the businesses.
DoubleClick recently acquired Sabela Media from 24/7 Media, in a bid to beef up its technology client roster in the Asia Pacific region. Engage, meanwhile, has been touting its technology products for combined online and offline publishers, and in digital media management.