The Upcoming Influencer Marketing Consolidation Wave

Will the Sprout Social Acquisition of Tagger Accelerate Influencer Marketing Consolidation?

By: Gary Moon, Managing Partner, Nfluence Partners

In a word, yes. We believe the acquisition of Tagger by Sprout Social represents a turning point in the upcoming consolidation wave across the Influencer Marketing landscape. Recently, many companies in the space have been focused on the consistency of their growth trajectories as well as turbulent private capital markets.  As a result, we believe there is inherent pent-up acquisition demand that will accelerate into 2024.

To date, the major Social Media Monitoring and Analytics companies have either stayed on the sidelines or dabbled in the Influencer Marketing space through smaller acquisitions, with both Meltwater and Cision/Falcon/Brandwatch entering the space in 2021 and 2022 respectively, and Emplifi’s Socialbakers combination with Pixlee – Turnto last year. This is despite strong product synergies between management, analytics, and the more campaign-driven nature of Influencer Marketing. The acquisition of Tagger by Sprout Social represents one of the strongest statements to date on the importance of and interest in product extension into the rapidly growing Influencer Marketing sector.

Although there are other product suite-driven acquisition strategies with other market adjacencies, the move by Sprout Social takes one of the better homes for the pure-play software companies in the space off the board. While a few musical chairs are left across the Social Media Management space, Sprout was one of the better strategic landing places, as evidenced by their willingness to pay a very strong strategic multiple for Tagger. 

Other key themes we are tracking in Influencer Marketing include how the winners within the space are becoming clear and what that means for intra-market consolidation. We are also tracking the impacts for agency and managed services businesses as the major holding companies increasingly pressure their in-network agencies to use internal holding company Influencer Marketing acquisitions, like WPP’s recent acquisitions of Obviously and Goat. 

Please contact us to talk through the strategic chessboard of the impending Influencer Marketing consolidation wave. 

For our 2023 Influencer Marketing Market Briefing => GO HERE

For our Influencer Marketing: 1H 2023 M&A Update => GO HERE