The AMC series Mad Men has garnered enormous popularity since its debut in 2007, a fact that is attested to by the 170 nominations and 67 awards the show has won throughout the course of its existence. The show’s portrayal of the advertising industry in the early 1960’s has won over viewers with lush costumes and set design, well-written dialogue, carefully crafted plot, and its willingness to address many of the vexing social issues of the time.
But Mad Men is also interesting in that it portrays an industry that is in many ways looks completely unrecognizable in its current format. These changes can at least in part be tracked by following technological developments over the past decades, which makes it all the more curious that Mad Men premiered the very same year as one of the most consequential consumer technologies of the new millennium, the iPhone.
The debut of Apple’s (AAPL) iPhone dramatically changed the landscape of the tech sector by shifting all of the focus onto mobile devices, transforming them into an enormous and growing market, one in which dominant tech firms of old like Microsoft (MSFT) and Dell (DELL) have quite visibly struggled to keep up with. But ripple effects of the increasing all-importance of mobile technology can be seen in other sectors and industries as well, and advertising is no exception.
Indeed, Sunil Gupta of the Harvard Business Review recently wrote that “mobile ad budgets in the US are expected to increase from $2.3 billion in 2012 to almost $11 billion in 2016.” Mobile has forced advertisers to adapt to a new set of parameters, but has also allowed for newer and better ways for them to reach audiences.
The smartphone is becoming an ideal point of convergence for a number other technological trends that have also been of consequence for advertisers. Phones and tablets are slowly but surely displacing PCs and laptops, and allow consumers to bring their social media and streaming content with them wherever they go. Furthermore, mobile devices allow advertisers unique opportunities to both collect more data on their audiences, and to use this data to target consumers on a more granular, individual level.
At the same time, tech companies whose revenues are so dependent on this technology that they themselves are responsible for, such as Google (GOOG) , Facebook (FB) , as well as Apple, typically do much of their own pitching by themselves. A look at publicly-traded companies operating in the marketing services industry bears this out.
The marketing services stocks who are today trading selling their shares on the market have all been forced to adopt to the new mobile landscape, but their businesses have not yet been taken over by it by any means. Furthermore, all of these companies have enjoyed an excellent year in 2013, and have seen their stock prices increase as a result.
The following six companies have been selected from the marketing services industry based on their yearly performance, and market-cap (small and above):
Clear Channel Outdoor Holdings Inc. ($CCR) –
Clear Channel is the well-known operator of billboards and the myriad other forms of outdoor advertising signage that populates the American landscape. Based in San Antonio, Texas, the company owns and/or operates some 650,000 advertising displays throughout the country, including most recently the digital billboards that are becoming increasingly ubiquitous in major cities like Los Angeles. Shares are trading for $9.23 each, up more than 31 percent in 2013.
Constant Contact Inc. (CTCT) –
The Massachusetts-based constant contact is a $702 million company that provides a variety of marketing services to small businesses and non-profits. Though it is perhaps best known for its email and social media-based products, the company provides other services such as online surveys and smartphone-based rewards/membership programs. Shares are currently trading for just shy of $23, having gained 61 percent on the year.
Harte-Hanks Inc. (HHS) –
Harte-Hanks is a $560 million company that provides digital and multi-screen marketing services to consumer and business-to-business advertisers throughout the world. Harte-Hanks also offers database marketing, communications management, website design, and direct mail services. Shares are trading for $9, up 55 percent in 2013.
Millennial Media Inc. (MM) –
The $520 million Millenial Media is the only company on this list whose business is specifically devoted to mobile advertising. The company helps advertisers with mobile banner displays and videos, as well as the collation and analysis of data collected from social media and GPS coordinated, and also helps advertisers judge the success of their campaigns. It is also the only company on this list that has fared poorly this year, with shares off nearly 50 percent to $6.50 a piece.
National CineMedia Inc. (NCMI) -
The $1 billion company operates a “digital in-theatre media network” in the United States that includes digital displays in theatres, as well as the advertisements that moviegoers will see on the screen before the movie. The company has presence on nearly 40,000 screens in over 1,500 theatres throughout the country. Shares are selling for $18.80, up nearly 40 percent in 2013.
Valassis Communications Inc. (VCI) -
The $1.14 billion Valassis is the dominant force in mail advertising, with its shared mail products that show up in your mailbox in the form of reams of colorful, newspaper-textured advertisements for numerous products, especially grocery stores, restaurants, and drug stores. The company also offers digital products, be they in the form of information management or digital coupons and reward cards. The company has had a good year with shares currently trading for $30.30 on a gain of nearly 22 percent.
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