The industry is seeing a trend towards consolidation and what I believe is driving it is the scale necessary to help manage a large brand’s customer acquisition. OPMs (outsourced program managers) typically started 10-15 years ago as one person to two person companies, with a focus on recruitment of affiliates and writing newsletters, and performing day to day functions. Some of those grew into agencies that provided additional services, and a select few determined that you had to take a holistic approach to customer acquisition using more in the toolbox than just affiliate.
It became important to manage affiliates, influencer, social, paid media, mobile, email, creative and much more. Our agency was one of those that realized that it’s too narrow to just look at the bottom or middle of the marketing funnel. You have to look at all channels as a holistic approach to customer acquisition, and to think about multi-channel attribution, and the complete customer journey. In order to work across all of these channels effectively, it takes human capital and deep resources in media including media dollars.
Most smaller agencies can’t compete and struggle to help large brands at scale. SmarterChaos always found a way to make it work, but to truly scale and to provide best-in-class services, we had to find a larger capability set with deep consumer insights, deep knowledge on media buying, and the best marketing technology stack.
The deal with DMS represents a very strategic vertical integration. Around the industry we also see horizontal integrations and mergers like Gen 3, OPM Pros, and AffiliateManager.com. That is a different strategy where they are working to build scale broadly, not deeply by just increasing the number of clients on the collective roster, but not going as deep as having Martech and Media Buying capabilities. It remains to see what will happen with the Clickbooth and Ignite OPM acquisition, or others that we are seeing in the industry as well (editor’s note: both Clickbooth & Ignite OPM were rebranded in 2020 as Perform[cb]).
It’s clear, however, that the trend is just ramping up and it’s not going away soon. Fragmented industries with many smaller players always trend towards consolidation, with companies looking for scale in order to provide better service at an equitable price, with superior results. DMS became an attractive partner to us immediately, and SmarterChaos became attractive to DMS because of our client roster and publisher coverage especially in direct-to-consumer ecommerce. It is a match made in customer acquisition heaven.