Sapient Makes Another Data-Centric Acquisition

Purchase of MPhasize Marks Third Deal for Company in a Matter of Months

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On the heels of snapping up two firms, Iota Partners and Second Story, Sapient has acquired data-centric company mPhasize.

With offices in Connecticut and a data team in Bangalore, India, the 4-year-old mPhasize promises to help Sapient's increasingly metric-hungry clients pinpoint how much of their money to spend across a growing variety of channels and what they can expect to get out of it in real purchases.

Marketing-mix modeling -- where brands should spend and how to meet particular goals -- is "at the very top of the list of the most strategic questions," asked by Sapient clients, according to Bill Kanarick, the company's CMO.

"That's a conversation we feel we'd like to own, as opposed to partnering to access that conversation," said Mr. Kanarick, in explaining why Sapient chose to buy mPhasize rather than simply partnering with the firm.

Sapient is open to doing more acquisitions in 2013, but Mr. Kanarick did not elaborate on which service areas specifically they'd most like to bolster.

Sapient's service revenues rose nearly 10% in the third quarter of 2012 over the year-earlier period to $288.5 million. Service revenues increased 24% year-over-year in 2011, hitting just over $1.02 billion.

As part of the deal, Sapient will acquire 100% of mPhasize. Purchase price was not disclosed. Sapient's last data-related purchase of boutique shop Iota Partners in September was aimed at helping SapientNitro, Sapient's digital division, develop projects that produce new forms of consumer-behavior data at a level that can be mined for insights.

MPhasize gets its data from its advertiser- and media-agency clients; that information might come from past campaigns as well as syndicated data sources. From there, mPhasize cleans the data and prepares it for modeling. For instance, the firm might help a client - Pfizer is one -- determine what amount of incremental ROI might be created when an additional $10 million is spent on a particular media mix in a given region.

For instance, the firm might help clients, which include Pfizer and Avon, determine what amount of incremental ROI can be created when an additional $10 million is spent on a particular media mix in a given region.

"We're in the business of helping [clients] analyze the recent past," said mPhasize founder Sunny Garga.

The clients' data always go back to mPhasize clients, but in its few short years the company has amassed a "very extensive benchmark database," said Mr. Garga. The database features benchmarks for cross-media metrics, ROI and other key indicators the firm has gathered from more than 1,000 brand clients in CPG, retail, quick-serve and other categories. The firm is pursuing automotive clients, Mr. Garga said.

Neither Mr. Kanarick nor Mr. Garga would share the number of employees at mPhasize, though around 15 New York-area employees are listed on LinkedIn. The firm also has data staff in India. Its relatively small size follows Sapient's typical approach of buying smaller firms to fill targeted strategic needs. In November, SapientNitro purchased Second Story, a 35-person shop that builds digitally-enhanced physical experiences.

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