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Inc. 5000 shows marketing tech catching up with buzzwords

DataXuMarketing might not be rocket science, but it’s getting closer every day.

Just look at the No. 1 advertising and marketing company on the 2013 Inc. 5000 List of the fastest-growing private companies in America. DataXu, which offers a sophisticated real-time decision engine that optimizes display, video, mobile and social ad placement across the web, was founded by former MIT scientists who developed the technology NASA used to guide its Mars missions.

Yep. Rocket scientists.

DataXu has turned the patented technology developed for the space program into a programmatic marketing solution that automates online advertising bidding and targeting by making more than 500 million decisions every second. The system analyzes consumer behavior and attributes and then bids on the ads – across all digital channels – most likely to convert, serving up the most relevant creative.

The company’s founders could have applied their technology to any number of industries, including aerospace and logistics. They chose marketing.

"The dark horse was Internet advertising," said CEO and co-founder Mike Baker in an interview with Forbes. "It requires trillions of tiny decisions matching ad creative to consumers to optimize profit. ... We know it’s valuable, it requires a core decision engine, and all the information is digital. So that’s the market we chose."

Many of the advertising and marketing firms leading this year’s Inc. 5000 rankings are turning marketing into a science. The list is filled with companies that help brands make data-driven decisions about how to interact with their customers. It speaks volumes about how the hot trends in the space right now – including big data, cross-channel marketing and personalization – aren’t just hallow marketing speak.

“There’s an expectation that technology must catch up with the buzzwords in the industry,” said Michael Hershfield, vice president of business development for personalized marketing technology company Sailthru, which made the Inc. 5000 list at No. 30 overall. “We’ve all heard these words many times, but they still mean something when you get down into the conversation.”

Hershfield said marketers are “still in the early innings” in terms of technology adoption, but the Inc. 5000 list shows that the industry is ripe for disruption.

“It’s amazing how marketing has become such a strong space for innovation,” he said. “Marketers will wake up to the tools available to them.”

Three marketing trends from the Inc. 5000 list

Here’s a look at three marketing services and ad technology trends that jump out of the Inc. 5000 rankings:

  1. Programmatic marketing: Part of DataXu’s vision is to move marketers beyond “operating with manual solutions based on intuition” and get them to embrace programmatic marketing, which leverages big data to place real-time, rules-based bids on digital advertising. Automation and algorithms will continue to play a bigger role in marketing campaigns as the amount of customer data continues to explode and the number of channels continues to grow. DataXu’s 21,000 percent revenue growth rate over three years – from $400,000 to $87 million – proves just how powerful marketing science can be.
  2. Integrated platforms: With data fragmentation posing a challenge for many marketers – they’re collecting data from individual channels and storing it in disparate systems, making “omni-channel” just a dream – companies like Blue Kai have launched platforms to bring all that customer information together in one place. The race to create a one-stop shop for marketing data will continue as marketers break down silos within their organizations and get their systems to talk to each other.
  3. A personalized web: Sailthru has grown from almost nothing to more than 100 employees over the past five years by being one of the first to analyze customer behavior, interests and preferences to create a more personalized web. Ad Roll is making retargeting personal by allowing marketers to create customer user segments. The granular level of personalization makes it possible to interact with countless customers in a way that is tailored to their specific profile.

What else does the Inc. 5000 list say about the future of marketing and advertising? Share your comments below.