Media Buyers Are Cautiously Optimistic About the Latest Run of Media Company Mergers

It's not all about the scale

Illustration shows people putting puzzle pieces together.
Media buyers are intrigued by the proposed mergers. Getty Images

Within days of one another, three pairs of media companies announced that they would be joining forces. The pairings include Vox Media and New York Media, Vice Media and Refinery29 and Group Nine and PopSugar.

Overall, these proposed media mergers have buyers excited, because it could mean more opportunity for innovation, better technology and an easier process for them to purchase inventory, some buyers told Adweek.

Publishers aren’t making any promises yet about what kind of packages they might be able to offer advertisers if these mergers go through. Still, media buyers said they’re encouraged about the potential room for collaboration once—and if—the companies are operating as combined assets.

“These [deals] make sense,” said Jenny Lang, svp for digital innovation and strategy, Magna. “Anytime a merger like this happens in the media community, it’s great for us because it’s fewer partners to go to for buying. We can make a deal and it doesn’t [involve] 10 different partners.”

The companies, once merged, will create “more efficiencies” for buyers and greater market strength, said Alexandra Levy, CEO of Silicon Alley Media.

“Given the marketplace realities, providing more scale, and offering greater buying efficiency, is a requirement these days to compete with the big three,”  Levy said, referring to Facebook, Google and Amazon. “More than ever, buyers are short on time these days—given the increasing complexities of digital buys—and they want to make fewer, not more, buys.”

These so-called efficiencies seem more attractive to media buyers over the scale that would be achieved by these proposed mergers. The publishers, too, are quick to highlight how these media brands fit with their respective audiences.

The respective brand websites for Vox Media and New York Media collectively reached over 115 million unique visitors in August, according to the most recent figures from Comscore. In the same period, Group Nine and PopSugar combined saw 76.3 million visitors and Vice Media and Refinery 29 reached 58.4 million visitors. Vice Media, though, claims to reach 350 million unduplicated with Refinery29, as 60% of its audience is located outside of the U.S.

The companies, though, say it’s about finding complementary audiences, not just scaling up.

“We’re not after scale for scale’s sake,” said Hozefa Lokhandwala, chief strategy officer at Vice Media. “We saw an opportunity in Refinery29, and we know that it’s a very complementary fit audience-wise.”

Ryan Pauley, chief revenue officer at Vox Media, shared a similar sentiment. “To have relevance for brands and marketers, you have to have scale, and you have to be able to reach audiences across platforms,”  he said. “We’re not competing with Facebook and Google on scale. That’s a fool’s errand. Nobody’s winning that game.”

What publishers are really up against in chasing those dollars going to social platforms, said Patrick McKenna, CEO of DMi Partners, are insights into audiences. Google, for example, is dominant primarily because the platform aggregates behavioral data and “[reaches] people at the point of intent,” he said.

Even with these mergers, publishers won’t have access to that kind of data, McKenna said, and “it’s hard to see how those large media companies will be able to compete.”

Publishers could still try to woo digital ad dollars by providing data points about whom they do reach. They also can offer clients customized content, using their rich reader analysis that could easily complement a programmatic media spend.

“There’s still an interest within media with the more bespoke programs,” said Danielle Sporkin, U.S. head of integrated planning at OMD USA. “[We’ll see] what the mergers mean for these bespoke offerings, different [specifically] IP for those types of programs. I’m eager to see what new ideas come to the table.”

It’s expected that Vice Media will continue diversifying revenue streams with Refinery29 in its portfolio by expanding 29Rooms, bringing Refinery29 into the fold and working Refinery29 into Vice Media’s creative agency, Virtue.

“Having a complete audience footprint and being a holistic opportunity for brands and agencies who are looking to talk to these complementary audiences is always helpful and positions us well with the brands,” Lokhandwala said.

Vox Media will continue to leverage its expertise in OTT and podcasts under its Vox Media brands, and use learnings from New York Media brands related to commerce and affiliate links, Pauley said.

“Brands have access and can work across this increased portfolio of scale and platforms to build their brands and their relationships with their audiences,” he said.

Ben Lerer, CEO of Group Nine, who was not immediately made available for a phone interview, but pointed, in a statement, to PopSugar’s offerings in commerce, licensing and experiential channels as successes.

McKenna said media buyers will be eagerly awaiting updates so they can figure out how to work with the newly combined entities.

“The opportunity for us is to take our advertising group and create more opportunities for them to get their message out,” McKenna said. “Anytime there’s change, there are more opportunities to do that more efficiently. It’s exciting for us. Whether it will be beneficial for us, we’ll see.”

@SaraJerde Sara Jerde is publishing editor at Adweek, where she covers traditional and digital publishers’ business models. She also oversees political coverage ahead of the 2020 election.