2007: Big Deals, Big Dreams

Companies raced to build up their digital presence in 2007 in a fervor reminiscent of the 1999 Internet gold rush.

After paying eye-popping prices for their online advantage, these companies must now dig in and integrate people, processes, data, and technologies in the coming year to ensure these initiatives succeed. Look back and consider these developments:

Integrated Tools

In its largest acquisition ever, Microsoft in August forked over nearly $6 billion to acquire aQuantive, which includes Atlas Web advertising management tools and interactive ad agency Avenue A|Razorfish. Plus, Microsoft invested $240 million for a 1.6 percent equity stake in social networking site, Facebook.

In October, Microsoft chief executive Steve Ballmer proclaimed advertising would become 25 percent of the company’s business. Still, Microsoft has a long way to go if Ballmer’s prediction is to come true. Its online services businesses accounted for only 5 percent of the company’s revenue as of September 30.

Throughout the year, all eyes were on Google and its plan to acquire DoubleClick, known for its display advertisement management technology. The $3.1 billion deal got tied up in regulatory reviews. The deal, which cleared the Federal Trade Commission (FTC) only last week, still faces scrutiny from E.U. anti-trust regulators.

What will the acquisition, if it’s allowed to go forward, mean for marketing and media professionals? Harry Gold, chief executive of Overdrive Interactive, outlined pros and cons. On the plus side, ad serving and online marketing data could be consolidated and integrated into one application, while on the down side the deal could limit competition and choice in ad serving and tracking.

Still, the Google juggernaut pushed ahead. By late September, its head count swelled to 15,916, an increase of nearly 50 percent since January 1. Most noteworthy: Google disclosed plans to develop an operating system based on open standards, for mobile phones.

After acquiring Tacoda, an online behavioral targeting firm in July, AOL moved quickly to integrate operations, establishing a new division, Platform A, to handle sales for AOL sites, its ad network, and manage related technologies. The most visible sign of change: AOL will move its headquarters to New York City from Dulles, VA.

Web analytics company Omniture purchased companies at a torrid pace, acquiring rival Visual Sciences, optimization firm Offermatica, behavioral targeting company Touch Clarity, and enterprise Web analytics provider Instadia. Shane Atchison, chief executive of ZAAZ, says there’s a big plus to vendor convergence: clients can focus on overall solutions instead of juggling multiple vendors and divergent technology.

Integrated Agencies

London-based advertising giant WPP Group was handed a juicy deal to exclusively work with computer maker Dell. The two companies will team up to form a marketing agency that will handle $4.5 billion in Dell accounts. Previously, Dell had spread the business among 800 agencies around the world.

The initiative, aimed at developing a coordinated and integrated marketing plan, came seven months after WPP announced plans to acquire 24/7 Real Media and its ad trafficking and reporting platform.

In a corporate shakeup at the Aegis Group, Carat USA, a media agency, owned by and Carat Fusion, a digital marketing business, merged operations with the goal of integrating traditional media and digital marketing services. Sara Fay heads up Carat, the name of the merged organizations.

Integrated Search

Ask, Google, Microsoft, and Yahoo each updated their search engines, promising to deliver better and more relevant search results.

Again, integration was the buzzword behind change: Ask, for instance, blends results from its image, video, local, news, and blog searches, while Google includes information from videos, images, news, maps, books, and Web sites.

How does universal search affect marketers? P.J. Fusco, lead search strategist for Netconcepts, predicts the change will have the biggest impact on big brands. “It’s no longer enough to think locally and act globally,” she warned back in July, advising companies to update approaches to accommodate integrated search features.

Looking ahead to 2008, one thing’s clear: The initial fervor over these initiatives will ebb, while the hard work (and pain) to make then succeed will induce headaches.

Happy New Year’s…and don’t forget the aspirin!

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