A couple of weeks ago, RhythmOne closed its acquisition of YuMe, one of the original leaders in video advertising. The deal was announced last September and was valued at approximately $185 million. The deal is the latest in a series of mergers and acquisitions consolidating the fragmented video ad tech landscape. To learn more about the deal and RhythmOne’s plans, I interviewed Dan Slivjanovski, Chief Operating Officer.
VideoNuze: Explain what RhythmOne does and why it acquired YuMe
Dan Slivjanovski: RhythmOne connects advertisers to audiences through a combination of differentiated supply, innovative technology and data-driven insights. Our end-to-end platform, called RhythmMax, offers direct, efficient and effective connections, driving ROI for advertisers and publishers. We were founded in 2004, focused primarily on internet video search. In 2007, we became a public company, and are traded on the AIM exchange, or the LSE, in London.
Today, RhythmOne is a marketplace for digital advertising, driving engagement between advertisers and targeted audiences at scale, and delivering real, measurable business outcomes. We have unified the entire supply chain, removing intermediaries, to create the most efficient platform possible.
YuMe was attractive to us because it gives us access to a leading data-driven marketing platform and unique video and CTV inventory and insights. Their demand-side software and services have been valued by brands, agencies and trading platforms for years. Prior to the acquisition, we were primarily delivering against performance-led KPIs. The ability to integrate their robust, first-party data management and targeting platform and differentiated supply, allows us to now meet an advertiser’s brand objectives as well, through a single unified platform.
VideoNuze: What are some of the advantages gained by integrating YuMe into RhythmOne’s platform?
DS: At the core, the primary advantage of the combined enterprise is efficiency for both advertisers and publishers. The combination brings demand-side and supply-side strength to high-growth areas including mobile, video, and CTV advertising, and facilitates seamless programmatic trading. Clearly, YuMe is a video advertising pioneer, and we expect it to continue to be a shining star within our offering.
The combined platform will rank as a top-five comScore marketplace, facilitating seamless, transparent connections between thousands of advertisers and brands, and provide a massive supply of brand-safe inventory. Within the marketplace, RhythmGuard, our proprietary brand-safety filtering technology, eliminates suspicious and underperforming traffic before, during, and after it reaches the marketplace.
VideoNuze: What will joint customers see from the deal?
DS: Brands and agencies will benefit from the ability to target quality audiences across screens through a wide array of formats including display, rich media, social and native, video, and connected TV. They’ll also have the ability to easily engage users across devices. They will realize greater campaign efficiencies with a streamlined programmatic platform that optimizes campaign spend. And lastly they can expect to achieve maximum ROI delivered against both brand metrics and performance-led objectives, depending on their campaign goals.
VideoNuze: Can you share any specific video growth opportunities you see for RhythmOne post-acquisition, such as in OTT and converged campaigns?
DS: The biggest greenfield for video growth is in the category of Advanced TV, which encompasses connected TVs, streaming devices, and OTT video. YuMe is a pioneer and leader in this category, with six years of experience successfully executing over 500 campaigns to date. The market for Advanced TV advertising is quickly gaining traction as a bridge between TV and digital video — potentially the best of both worlds — offering the targeting power of digital and the impact of TV.
VideoNuze: Video ad tech has gone through a wave of consolidation - what’s driving this and will it continue?
DS: It’s clear that for far too long the value chain has been fragmented, to the detriment of brands, advertisers and publishers who have paid the price for inefficiency. As the market consolidates, independent end-to-end marketplaces are emerging with massive network effects and value. These are entities that have supply-side scale, integrated demand solutions, and true value-added features like unique targeting, audiences and/or data segments – all geared to help brands deliver better business outcomes.
VideoNuze: Look down the road 2-3 years - what’s the biggest difference you see in video ad tech vs. today?
DS: Technologies that unify TV and digital campaigns and streamline measurement will keep getting smarter, giving advertisers the ability to run seamless campaigns across all media. As the same content becomes available across linear TV and streaming services, including live news and sports, the onus will be on marketers to think beyond the silos with integrated TV campaigns that include traditional broadcast and advanced TV. We expect new technologies — from us and others — to advance this convergence with unified measurement and continuously improving audience targeting capabilities.