Dive Brief:
- The Wall Street Journal reported that AOL CEO Tim Armstrong is touting the company’s data, including first-party data from parent company Verizon, gives it the opportunity to compete with Google and Facebook in the digital advertising arena.
- Armstrong used a February industry trade show in Las Vegas to personally pitch AOL as a credible threat to Google and Facebook to ad buyers.
- According to the Journal, he expects AOL to be the to be the top mobile media company in the world by 2020, reaching two billion users (compared to 700 million today) and generating as much as $20 billion in revenue.
Dive Insight:
Armstrong clearly has high ambitions. One factor in his favor, even if the premise seems like a long shot, is the access to Verizon’s data. The digital advertising world is rapidly moving toward mobile – mobile ad spending in 2016 is expected to amount to 63.4% of digital spending overall, according to eMarketer – and having first-party data from mobile devices, rather than interaction via a mobile device, is a powerful information source for targeted ads.
Another development might also boost AOL’s fortunes. Right now Verizon is a leading contender in the auction for the core of Yahoo’s business. That alone isn’t a complete game-changer as Yahoo significantly trails Google and Facebook, hence the reason it has been flailing for some time, but it would be one more data trove of which AOL could take advantage.
“If you are going to take on Facebook and Google, Verizon and AOL make for a nice powerful property,” Robert Peck, managing director and Internet equity analyst at SunTrust Robinson Humphrey, told the Journal. “But you need bigger scale to make you as relevant. Yahoo gets you there.”