Mobile operator O2 has acquired the Weve digital wallet initiative it set up with EE and Vodafone, after digital payments failed to take off and Weve turned to mobile advertising instead - which O2 is now betting on.
Weve will now trade as a wholly owned subsidiary of O2. O2 is currently being acquired by rival UK mobile operator 3, so that hasn't stopped O2 going on the acquisition path.
The deal, said O2, comes as a result of a “strategic re-evaluation” of Weve to “address the increasing significance and power of mobile in digital advertising”.
Weve took the strategic decision to prioritise and develop its expertise in mobile advertising at the end of last year. It has attracted some of the biggest brands and mobile advertisers since its establishment in 2012, including Monarch, Tesco, ITV and Ikea, although it is unclear whether Weve is actually profitable at the moment.
Weve, as a subsidiary of O2, will have additional advertising and offer opt ins from O2 Wifi users (14 million) and Priority offer service users (6 million), delivering greater scale to the business, said O2. Alongside scale, added O2, the inclusion of O2 Wifi and Priority will mean more data and richer analytics.
“By bringing this rich data to business customers we will be able to help them better communicate with their customers through relevant, targeted advertising meaning that customers will be served up offers for the things that we know they care about,” maintained O2.
In relation to 3's takeover of O2, O2 said: “With only one owner to answer to, not 3 shareholders and a separate board, Weve can be much more agile.”
David Plumb, Telefonica digital director (Telefonica currently owns O2), said: “By focusing on mobile advertising Weve has been really successful, growing by 45 percent year on year in 2014.”
The UK mobile digital advertising market was estimated to be worth £850 million last year, he said. The acquisition of Weve by O2 is expected to lead to redundancies among its 100 staff however.