Publicis acquires Profitero to add analytics layer to commerce bets

Dive Brief:

Publicis Groupe has acquired Profitero to strengthen its analytics capabilities in e-commerce and omnichannel services, according to an announcement. Financial terms of the transaction were not disclosed, though sources told The Wall Street Journal the deal carries a price tag of around $200 million.
Profitero’s technology and 300 employees will join Publicis Groupe with the transaction. The software-as-a-service (SaaS) provider will continue to operate as a company within Publicis, led by chief executive Bryan Wiener and President Sarah Hofstetter. Wiener will report to the ad holding group’s CEO and Chairman Arthur Sadoun.
Profitero operates in over 50 countries with a network spanning more than 4,000 brands and hundreds of retailer sites. Agencies continue to invest heavily in e-commerce, including through M&A, as clients seek partners who can help transform their businesses for a more digitally-led era.

Dive Insight:

Publicis is positioning the Profitero deal as helping to round out a suite of commerce services that has grown expansive in recent years and increasingly benefited the bottom line. Marketers were already shifting more of their dollars to online sales channels prior to the pandemic, and those moves accelerated previously impacted in-store shopping. Even as brick-and-mortar starts to bounce back, brand interest in e-commerce has appeared to hold steady, boosting agencies that were once laggards on the transformation front.

Profitero has a lot of data, a key asset in the race to win on the commerce front. The SaaS firm operates an extensive network covering thousands of brands and running analytics on more than 700 retailer sites. Combining those resources with Publicis’s aims to help clients better optimize their marketing content and search results performance, as well as track factors like competition, pricing, product availability and user ratings and reviews.

In the announcement, Sadoun detailed how Profitero will be additive to the “four pillars” that currently support Publicis’s commerce functions. Epsilon, the data-marketing firm the group acquired for a whopping $4.4 billion in 2019, helps clients better understand how people shop, while CitrusAd — a retail media company Publicis bought last year — is focused on maximizing performance on e-commerce sites. Publicis Media provides brands with scale and Publicis Sapient an engineering backbone. Epsilon’s identity product, Core ID, also now wields data on 300 million consumer profiles at the global level.

The Profitero deal suggests that agency deal-making remains hot despite macroeconomic disruptions, like the war in Ukraine and rising inflation, that have slowed other areas of the ad industry. Rivals are similarly trying to implement commerce services that cover more aspects of the sales funnel and campaign management. WPP in late April unveiled Everymile, an “end-to-end” managed service solution that adds demand generation, online trading and merchandising, supply chain and logistics capabilities to WPP’s commerce roster and is built on a proprietary tech platform. The concept is fairly distinctive coming from an agency, pitting the group against more traditional e-commerce providers like Shopify.

More ambitious bets on commerce arrive as the agency category performs well during an otherwise volatile economic period. Publicis Groupe saw organic revenue growth, a key measure of agency health, rise 10.5% in the first quarter. Gains were attributed to rising demand for data-driven marketing, digital media and commerce.