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Evalla Advisors Q3 2024 M&A Landscape in Marketing: Newsletter

As we conclude Q3 2024, the M&A landscape in the marketing industry remains robust, supported by favorable economic conditions and strategic opportunities. This newsletter provides a detailed look at the key trends driving M&A activity alongside notable transactions that are shaping the future of the marketing industry. Market Activity and Valuations: Deal Volume Increase: Lower interest rates have reduced borrowing costs, fueling more transactions across the industry. Buyers are capitalizing on this environment to pursue both strategic and financial deals, leading to an uptick in deal volume. Valuations Holding Strong: High valuations persist, especially for digital transformation and data-driven firms. The EV/EBITDA multiples for digital and IT consulting firms in marketing have climbed from 13.2x in Q1 to 15.1x in Q3, as buyers prioritize innovative and AI-powered marketing solutions. Key M&A Trends Shaping the Marketing Industry: Debt-Driven Acquisitions: Lower interest rates have made financing cheaper, prompting a surge in acquisitions. This trend is expected to continue as firms take advantage of affordable capital. Digital Transformation Demand: Agencies specializing in digital transformation (data-driven marketing, omnichannel engagement) are in high demand, with buyers willing to pay premiums to stay competitive in a digital-first world. Influencer & Social Commerce Expertise: With social media…

The End of the Deal… what nobody talks about

End of the deal: How to avoid common post-LOI pitfalls “Time kills all deals… but rushing gives away your leverage.” – Evalla Advisors Founder & Managing Partner, Lori Murphree Investment bankers and M&A advisors tend to emphasize the steps leading up to an LOI:  boosting value, identifying the right partner, preparing financials, and structuring deals. The post-LOI phase, during which parties manage due diligence, negotiate working capital, cash & debt definitions, and navigate the various components of closing the transactions and true-up process, often remains overlooked. Yet this phase requires as much rigor as the first part of the process: After all, nearly 50% of deals fail to close even after an LOI is in place. Some of the most common reasons deals don’t close after an LOI is signed include: Cultural and strategic misalignment: The buyer and seller may realize they are not the right fit after further scrutiny. Funding issues: Buyers could lack the necessary funds to close the deal if seller does not sufficiently diligence the buyer. Missed projections: Sellers might fail to meet projected financial targets. Client losses: The seller could lose a key client during the negotiation process. Uncovered risks: Due diligence may reveal risks…

2024 Update: Artificial Intelligence in Marketing

The global value of AI in marketing is expected to reach $24 billion in 2024–and $105 billion by 2030. Evalla Advisors’ “Artificial Intelligence in Marketing” reportexplores how it’s grown over the past 12 months, what factors are driving the demand, and where it’s headed. Increasing demand for advanced analytics, automation, and enhanced customer experiences have fueled the AI marketing boom, as have the proliferation of digital data and the evolution of consumer expectations. AI is now considered a critical component of any brand or agency’s modern marketing strategy. The report covers such topics as how the landscape has evolved over the past 12 months, Generative AI trends, ways in which major advertising agencies and brands are using AI, compensation models, and ethical concerns over copyright. It also examines future plans for the technology. Download Please enable JavaScript in your browser to complete this form.Email * Submit

Evalla’s M&A Trends & Insights

We are reaching out to you to share our recently released newsletter on M&A trends and insights in the marketing industry. In this edition, we delve into digital media and marketing M&A activity by sector alongside insights into how generative AI investments fueled private markets. We also provide a detailed analysis of recent marketing-services transactions, explore growth trends in publicly traded holding companies, and offer predictions for marketing industry trends in 2024. We hope you find this newsletter valuable and welcome any questions or requests for additional information. Download Please enable JavaScript in your browser to complete this form.Email * Submit

Evalla advises both OKRP and Red Tettemer

Evalla Advises OKRP on Merger with Barkley Leading independent agencies Barkley and OKRP have merged to become BarkleyOKRP. This new entity combines two of the fastest-growing agencies in the country, both with proven track records for creating work that sparks with consumers and drives out-sized results for clients. With more than 650 employees across five offices in Chicago, Kansas City, Denver, New York and Pittsburgh, BarkleyOKRP is now one of the largest independent agencies in the country. Evalla Advisors acted as lead strategic M&A advisor to OKRP on the transaction. “In a world where the choice is often ‘big holding company’ or ‘small independent,’ BarkleyOKRP provides an alternative that marries the best of both worlds. We affectionately call it ‘big indie,’” said Jeff King, CEO of Barkley, who retains that role in the new agency. “OKRP has built a creative powerhouse and Barkley, in addition to its own award-winning creative product, has built a foundation of modern consumer expertise. Combined, BarkleyOKRP clients will receive the very best of strategy and creativity in an agency that has broad capabilities and significant scale.” “Barkley’s operation and leadership were instantly impressive – but what really locked this partnership is our mutual belief that…

Unlocking the Power of AI in Marketing (2023): Trends, Challenges, and Organizational Impacts

In today’s rapidly evolving digital landscape, Ai has emerged as a transformative force, revolutionizing the marketing industry. From enhancing customer experiences to optimizing campaign strategies, Ai’s potential is vast. In our Ai Trends Report, we will explore key insights from our comprehensive analysis to provide a holistic overview of how Ai is reshaping marketing. We will delve into the benefits of Ai for marketing agencies, the potential threats it poses, integration pathways, and its impact on M&A activities. Additionally, we discuss market trends, including the consolidation of Ai companies, and examine the organizational disruptions executives are grappling with in their quest to harness Ai’s power. Join us as we navigate this transformative journey and unlock the full potential of Ai in marketing. Download Please enable JavaScript in your browser to complete this form.Email * Submit

Mod Op Makes First International Acquisition with Purchase of Toronto-Based Agency, Context Creative

Acquisition marks sixth in five years and integration of second international office  MIAMI – January 17, 2023 – Mod Op, a strategic marketing, design and communications agency with offices across the U.S. and an office in Latin America, announces its first international acquisition, Context Creative, a Toronto-based, full-service creative agency. Context Creative will become Mod Op’s second non-U.S.-based office alongside its office in Panama.  “The addition of Context Creative to our team brings us more than just an experienced group of professionals, it’s also our first acquisition of an agency outside of the U.S.,” said Eric J. Bertrand, CEO, Mod Op. “This is the logical next step for our agency and enables us to offer our clients the well-known benefits of cross-border business relationships. Context Creative’s well-rounded staff and expertise in the renewable energy and government sectors make it a perfect fit for Mod Op.”  For more than two decades, Context Creative has worked collaboratively with clients to solve branding and communications challenges across sectors most critical to society and the economy, including energy, healthcare, manufacturing, transportation, education and financial. Beyond award-winning creative, the agency specializes in formulating results-driven strategies and applying design thinking to deliver highly effective B2B and…