Q3 2022 insights into Digital Services.

Oliver Schweitzer and Ravi Ghedia, Executive Directors at GP Bullhound, said: “We have highlighted various key and growing Digital Services trends in Q3. Privacy pressures are driving M&A and investments in adtech towards innovative cookieless technologies, such as contextual advertising. Latin American countries are seeing significant M&A activity, as rapid technology adoption in the region leads to increased demand for digital services providers. Lastly, as industry players seek to supercharge their customer acquisition processes, there is growing demand for innovation in UX design to stay ahead of competition. Q3 saw a reduction in deal activity versus the last 2 years, in response to macroeconomic factors in the market.”

What’s trending this quarter in Digital Services?

Contextual advertising resurgence driving significant consolidation and investments

• Privacy pressures are driving advertisers towards cookieless technologies
• Advances in machine learning and AI have enabled a number of other technologies, such as contextual advertising, direct sales and digital fingerprinting, to also gain traction
• A hive of investment activity is going on in the space including Advent’s €250m investment in Spanish adtech provider, Seedtag

Growing LatAm digital services market leading to increased M&A

• Rapid technology adoption in the region has led to increased demand for digital-first services
• Large incumbents are recognising the need to have Latin American presence in order to win large global clients
• Significant deals within the space include WPP’s acquisition of Jeffrey Group and Accenture’s acquisition of Tenbu

The need for seamless UX design is driving consolidators into M&A mode

• Companies need to offer innovative digital products that work flawlessly across all media channels and that collect and utilise data in an ongoing feedback loop
• The UX design software market is likely to reach $20bn by 2028 at a CAGR of c16%
• Multiple high-profile deals were signed in Q3, including the acquisition of London-based design and UX agency Rufus Leonard, by Capgemini

Enquiries
For enquiries, please contact:
Oliver Schweitzer, Executive Director (US), at oliver.schweitzer@gpbullhound.com
Ravi Ghedia, Director (Europe), at ravi.ghedia@gpbullhound.com

About GP Bullhound
GP Bullhound is a leading technology advisory and investment firm, providing transaction advice and capital to the world’s entrepreneurs and founders. Founded in 1999 in London and Menlo Park, the firm today has 12 offices spanning Europe, the US and Asia. For more information, please visit www.gpbullhound.com.