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For those of you that haven’t seen – WPP’s Kantar bought Precise Media earlier this week in what is reported to be a £70m deal.
Here are a few thoughts on what’s behind this interesting move:
In terms of the macro trend, this is just the latest in a long line of consolidation in the PR measurement evaluation market. This move towards consolidation is driven by technology, globalisation of the media, globalisation of the customer base and economies of scale. In the UK, Precise have a bigger market share than Kantar in the media evaluation/measurement market. But Kantar have global measurement offer – hence Precise was a good fit for Kantar.
Is this deal driven by data?
By buying Precise, have Kantar bought the data to feed their higher value add end measurement consultancy? Probably not. The purchase of Precise does means that Kantar now have access to lots more raw data than they did before, but this data, from a value perspective is not likely to be a driver for the merger.
So it’s the management team that Kantar have bought?
Probably, yes. The performance of the Precise management team has aided in the growth of Precise in terms of market share and revenue over the last 8 years. Initially they bought small firms to add scale, then they invested in technology and moved the business from a media monitoring dominated firm to a higher margin evaluation business.
The potential to scale up this model across international markets and add a chunk of UK market share is probably what persuaded WPP to move for Precise.