Social media primed for advertising M&A

Contact: Scott Denne

Advertising already generates billions of dollars for Facebook and Twitter, but the market for tools that enable advertisers to target social audiences is still nascent. As the importance of advertising on social media grows and the platforms become more diverse, businesses from different corners of the marketing and ad-tech ecosystem will likely add offerings to address this need.

There have already been a few tuck-ins by advertising and social media marketing companies such as Sprinklr, MediaMath and Buddy Media (before becoming part of Now, changes to Facebook’s News Feed algorithm that limit the reach of organic marketing mixed with a host of diverse social platforms beginning to sell advertising could spur dealmaking and generate attention for social advertising software vendors that can execute and optimize social advertising budgets.

Businesses built around social media marketing or those that focus on paid advertising in other, non-social channels have, so far, been the acquirers of social advertising firms. We believe the categories of acquirers should and will expand to include enterprise software providers, small business software vendors and, of course, continued activity from ad-tech firms.

Subscribers to 451 Research’s Market Insight Service can access a detailed report on this sector.

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