Dive Brief:
- Two separate studies on M&A activity in the marketing technology sector found the volume of deals is down, but overall value is up.
- While the number of deals have gone down from 2014, the value of deals has risen by 40%, according to research from investment bank JEGI.
- Particularly, activity and consolidation in martech combining automation and data is seen as a driving force increasing the value of M&A deals.
Dive Insight:
Mergers and acquisitions in the marketing technology sector is growing in value, if not in volume.
The JEGI market report looked at transactions in the database and information services space and found the number of transactions dropped from 2014, but the value of deals is up by 40%.
Mergermarket research focused on technology, media and telecommunications (TMT) and found the value of sales over the first three quarters of 2015 outpaced the total value of every calendar year since it began tracking the data except for 2006 with Q4 activity still ongoing.
“There’s an enormous need for people who provide the tools for marketing automation," Tolman Geffs, co-president of JEGI, told Ad Exchanger.
The sheer number of martech companies is on the rise, going from 947 in January 2014 to 1,876 in January 2015 in an informal survey by the Chief Marketing Technologist Blog. IDC predicts international spending in marketing software will reach $22.6 billion this year and rise to $32.3 billion by 2018.