Acxiom Corp. has narrowed its focus and is evolving into a different company, CEO Scott Howe says.
“We’re becoming a different kind of Acxiom, with the best of the old but a lot of really new, exciting stuff,” he said in a recent interview. “Over time, I’d like to think we stop becoming the marketing company and increasingly become the data company that is effective in marketing, in health care, in insurance and B2B supply chain.”
The evolution includes the sale last month of Acxiom’s Little Rock headquarters, which was never fully occupied, and plans to renovate its original campus in Conway.
The company also hopes to expand its client base. “Any industry that needs to collect, ingest, interpret and activate data is an industry that, long term, we intend to serve,” Howe said.
And since data involves everything these days, that intention has the potential to fuel growth.
Howe compared the firm as it is now to Amazon in 1996. Amazon had built a great infrastructure to sell books. Now it’s an online retail giant selling just about anything.
He said Acxiom built its data infrastructure for one purpose: to sell marketing services. But the same infrastructure that solves complex marketing problems could be used to solve complex problems in other industries where a lot of data is available, but in separate silos.
Howe gave the example of enabling medical records housed at different doctors’ offices to follow the patient from doctor to doctor instead.
He hopes to please shareholders with revenue growth of more than 10 percent this year, compared with the 1.5 to 2 percent annual growth Acxiom has seen over the past five years.
His plans include continuing to gain both direct clients — very large companies that Acxiom assigns teams to work with — and indirect clients. Those clients, which Acxiom didn’t have five years ago, are businesses that use sites like Facebook to purchase targeted advertising that runs on Acxiom’s data infrastructure.
Howe said gains in indirect clients have fueled a boom, with Acxiom adding more clients in the last two years than in the previous 10 years combined.
As it’s shifting to doing more, the company has also narrowed its focus to three segments: marketing services, audience solutions and connectivity.
The firm moved away from a “mismatched portfolio” by selling off subsidiaries that didn’t quite fit, like its email business and information technology services business, Howe said.
He then described the company’s more cohesive portfolio these days.
The connectivity segment is like a phone grid or electric grid, but for data, he said. It has been enhanced by the company’s acquisition of digital marketing service LiveRamp. Howe thinks of connectivity as “the pipes that connect the world.”
Audience solutions are the fuel that runs through those pipes, Howe said. That division deals in preparing raw data for client use.
The segment launched a self-service tool called Audience Cloud this year for advanced management of data across all the ways it is delivered to consumers — traditional mail, email, mobile, social media and more. Howe said the new tool automates the selling of data.
Marketing services is an extension of the client’s marketing staff. That division figures out what the data means and how to use it in advertising and marketing campaigns, Howe said.
“We are unquestionably the best marketing services, marketing database company in the world. And we have been that for 40 years. That’s our legacy. But, by virtue of having our data business and our connectivity business, it makes that marketing services business even stronger,” he said.
“Likewise, the symbiosis between if you lay down pipes and then you have the data to push through it, those two businesses are perfectly complementary,” Howe said.
(Related: What Does Acxiom Do?)
Praises LR HQ Sale
The CEO also said selling the headquarters in downtown Little Rock — 12 stories, 188,460 SF and the adjoining parking deck — to Simmons Bank of Pine Bluff is a good move in the right direction. The $25 million from the sale freed up capital to renovate the Conway campus, built more than 40 years ago.
Six floors spread among three buildings have already been modernized, according to Marc Haynes, vice president of Acxiom’s 160-person Workplace Experience division, which is in charge of amenities for employees that include a community garden, soccer field, one free lunch per week, discounted massages, a recently remodeled fitness center and much more.
The company plans to finish sprucing up the rest of the campus in its next fiscal year, which runs from April 1 to March 31, Haynes said.
The company declined to disclose how much it is investing in the Conway headquarters.
“The key word for us is drive innovation and engagement,” Haynes said, adding that the company is giving employees a more open layout with sit-and-stand desks.
Howe said innovation happens when employees bump into each other, so plans call for a larger cafeteria and community space on the Conway campus. The goal is making Acxiom a better place to work.
He said that the Little Rock building never held the 660 people it was built for, and he believes the investment in the Conway campus should have been made long ago.
Charles Morgan, Acxiom’s CEO for 36 years before retiring in 2008, said the building was about 80 percent occupied at its peak 10 years ago.
Plans for its construction were announced in 1999, and the city helped out with a multimillion-dollar revenue bond issue.
At that time, Morgan said, Acxiom had tapped out the market in Conway and Little Rock was more central for commuters from Hot Springs and other cities. A survey of employees also revealed a desire to be downtown. Then the city offered incentives.
Morgan said the building’s recent lackluster occupancy was caused by executives moving to California, where Howe lives, and by the placement of more employees in larger cities in other states.
Vice President Haynes said 1,500 employees — more than half of Acxiom’s U.S. workforce of over 2,800 — now work in Conway. It employs another 800 to 1,000 overseas.
More than 100 employees moved to Conway after the sale of the building, but its 14-person legal team will stay in Little Rock.
They will work in the Third Street building, with Simmons Bank’s permission, until a temporary space is found. But by fall they will move into 11,215 SF of leased space being renovated on the second and third floors of a multi-tenant building at 301 Main St.
The Main Street location will have room for 50 people and will serve employees who need an occasional desk there or to meet with clients in Little Rock.
Where the Clients Are
In explaining the movement of Arkansas employees, Howe also responded to criticism concerning Acxiom’s senior executives living outside Arkansas.
“I think that is the silliest thing. In any global company, it doesn’t matter where people live. What matters is where are their clients. That’s where you’ll want to be,” he said.
“If headquarters are defined by where the senior executives sleep, then our headquarters is probably an aisle exit row on American Airlines,” Howe joked.
“Our leadership, they’re on planes. They’re going to see clients. They’re going to collaborate. And having them sit in an office in a headquarters would be the biggest waste of time,” he said. “That’s not how modern companies are run.”
Howe lives on the West Coast, but has a condo in downtown Little Rock.
He said the highest-ranking executives who spend most of their time in Arkansas include Mike Lloyd, senior vice president of sales and client services, Chief Legal Officer Jerry Jones and Chief Security Officer Frank Caserta.
But no matter who it hires or where those employees call home, Howe said, Acxiom will always seek out Arkansas values, like a strong work ethic.
Howe said people around the world are rediscovering the company, but it’s still a hidden gem in its home state, and he’s working to make it noticed.
When he took over, “for whatever reason, we had fallen out of our step. It started to become a little forgotten. … All the answers were here.
“Between our people and our clients, they told us exactly what we should do and we followed that, and I think, with a lot of success,” Howe said.
One result of the changes at Acxiom has been its growth in market capital, from less than $900 million when Howe arrived in 2011 to $2.2 billion this year — or about $10 a share to $27-28 a share, he said.
Also, its client base is “creeping up on 100,000,” including those new indirect clients.