Operator warns of a reduction in Weve’s near 100 headcount due to duplication following its purchase of the company earlier this month
O2 last week completed the purchase of digital advertising platform Weve from rivals Vodafone and EE – but warned cuts to its current 90-plus headcount are inevitable.
The firm, formed as a joint venture between the trio in 2013 at a cost of £40 million, works with advertisers to send location-based digital marketing directly to a customer’s mobile device. No sale price has been revealed.
The business is now set to be integrated into O2’s existing platform, Priority – with O2 digital director David Plumb (pictured) admitting ‘duplication’ in roles will result in a reduction in head count.
A consultation process has begun to determine where cuts will be made and potential redeployments of staff.
“We will help any potential redundancies look for vacancies within O2, to make sure they are transitioned in the right way,” said Plumb.
Plumb revealed digital marketing spend in the UK doubled to almost £850 million last year – with Weve accounting for around £18 million. He added of the three operators involved in the JV, O2 was gaining the “most benefit” leading to its rivals relinquishing their share after three months of talks.
In its year one financial results, Weve turned over £13 million, but made a loss of £25 million. According to Plumb, turnover has grown by 40 per cent year-on-year, having worked with over 600 brands so far this year. 20 million customers are signed up to receive marketing, half of which are on O2.
“It’s a growing market and we can see scope for growing that even further by bringing it in-house,” he explained.
“It became clear very quickly that we value the digital advertising business at O2 much more highly than the other operators, because we have existing businesses, like Priority. By bringing those businesses together, we have the opportunity to take an already growing business and accelerate it even further.”