Michael Karg has been in the Ebiquity PLC (LON:EBQ) hot seat for just two months, but already he has a fairly well-defined strategy for the marketing analytics specialist.
The word that crops up at the end of our conversation is a distillation of his thinking. That word is ‘clarity’.
Ebiquity is providing clients with clarity, Karg says, by measuring precisely and scientifically the impact of their marketing actually has.
To do that they have to sift terabytes of data and make sense of it.
“There is an increasing discussion around transparency and accountability within marketing,” adds the new Ebiquity boss, who was recruited from international marketing agency Razorfish International, where he was also CEO.
“The media space has become awfully complex for our clients - particularly in digital, and they are looking for independent advice.
“They are spending a lot of money. They want to know whether they are spending it well.”
Annual results published earlier reveal that Karg has inherited from predecessor Michael Greenlees a company that is performing solidly.
Two of its three operations – Media Value Management (MVM) and Market Performance Optimisation (MPO) – are firing on all cylinders.
MPO, which Karg describes as providing the “data science of marketing spend”, impressed most with top line growth of 38%.
MVM’s expertise in helping advertisers measure their media performance has also been in demand.
The outlier of the three Ebiquity businesses is Market Intelligence, which is a mature, highly competitive sector. The unit’s performance is expected to stabilise this year after some remedial action.
“We are making some exciting improvements to the current offering,” says Karg.
Going forward the major investment will be funnelled into the two high growth businesses, particularly MPO. There may also be scope to make selective acquisitions to accelerate the growth trajectory.
“We are not revolutionising anything that is already in place. We will be doubling down on what we have,” the new boss says.
Karg has identified some wins internally that could add some further momentum to the business.
For instance, management of a small number of “high-potential” clients will be done globally, offering the full smorgasbord of Ebiquity services.
“We are going out to hire a global chief client manager because much of our growth will come from globally operating clients that use our services across a number of geographies,” says the Ebiquity chief.
“There is an opportunity now that we have a full network in place to introduce our clients to the full suite of services we offer across geographies.”
The share price, up 1.5p at 137p this morning, still only values Ebiquity at 12-times prospective earnings.
The City broker Numis calls this stock market rating ‘anomalous’, which in plain English means Ebiquity is cheap.
Numis has a point when you look at the crazy earnings and revenue multiples privately owned rivals to Ebiquity are being bought and sold for.
Karg is more circumspect in his appraisal. “I think from the long term perspective marketing analytics and independent advice will be in huge demand. Has that been factored into our share price yet? I’m not sure.”