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Liveramp: acxiom's $310m silverjullet.

Acxiom Corp. announced earlier this month that it had purchased LiveRamp, a tech company that started in 2011 in San Francisco.

At $310 million, it's a huge purchase for the Little Rock data miner, which had revenue just shy of $1.1 billion in the fiscal year that ended March 31.

So why would Acxiom pay so much for a little California startup?

It all goes back to Acxiom's newest product, the Audience Operating System.

The company launched AOS late last year, touting it as the future of the company's data mining products. However, CEO Scott Howe told analysts after the company's latest earn- 'ings report that there was big demand for AOS, but Acxiom was having a hard time getting consumer information into the system.

This is where LiveRamp comes in.

LiveRamp deals in what's called customer relationship management, or CRM, data. While much data used in targeted advertising comes from Internet searches and other areas, CRM data comes from a potentially more reliable source: offline. its digital platforms, a solution that puts the marketer back into the driver's seat."

When LiveRamp launched in 2011, it only matched CRM with customers using computers; in April, it announced support for mobile.

"Mobile marketing is rapidly developing and commanding more marketing spend," Hoffman said in a release. "LiveRamp's new data onboarding to mobile product will allow marketers to use their customer database for in-app personalization, targeting, measurement and analytics."

The benefits of this for Acxiom should be obvious: It can finally get the data it needs for its AOS clients, and targeted ads start to become even more targeted.

Acxiom claimed that, after LiveRamp is integrated, the company will be able to reach 99 percent of the adult U.S. population, with options to expand globally.

But there are some questions about how well this will work: Some of LiveRamp's clients, like Epsilon, compete with Acxiom. In May, Hoffman and Howe told AdExchanger, an online trade publication, they were not concerned. Hoffman said Acxiom has a "commitment to keeping LiveRamp as a neutral and open system."

Howe went so far as saying that competition in the data mining industry needs to simmer down. He told analysts in May that "we live in a world where cooperation and connectivity are the new norm. And so as a result our sales force needs to change, and the days of cutthroat competition need to be replaced, and is being replaced, by dedicated sales resources that are solely and maniacally focused on their particular clients and helping their particular clients succeed."

Even so, investors didn't seem to greet Acxiom's announcement with much confidence. When Howe announced the LiveRamp purchase on May 13--the same day that the company declared a net loss of $29.2 million for its fourth quarter of 2014--Acxiom's stock dropped from about $27.50 to just over $21, and it's not shown much recovery since then.

Scott Howe

Luke Jones
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Title Annotation:Technology
Author:Jones, Luke
Publication:Arkansas Business
Date:May 26, 2014
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