The management team of LG Ads Solutions is working.
LG Ads (née Alfonso) is the ad technology division of South Korean electronics manufacturer LG. In January 2021, LG acquired a majority stake in Alfonso for $80 million (and a bit more).
AdExchanger has learned that as of Friday, two of Alfonso’s top brass, including CEO Raghu Kodige and Alfonso’s co-founder and CEO Ashish Chordia, have been fired. An LG spokesperson confirmed their release.
Adam Sexton has been appointed as Acting CEO, succeeding Kodige, who was the founder of Alphonso. Sexton will also take on the newly created position of chief operating officer.
Although Sexton has executive experience in the television industry, including as a former CEO of Samsung, his most recent experience was as a former CEO at Gracenote for a year between 2014 and 2015, several years before the company was acquired by Nielsen.
Departures through Kodige and Chordia may not stop. Although AdExchanger could not confirm by press time, other C-level leaders from the LG Ads team may have been fired as well.
But the change isn’t a snub about LG’s exit from ad tech, or the ACR data that underpins its ad business.
According to LG, the exodus is the beginning of a “strategic shift” that will focus LG advertising on additional growth.
But one has to wonder how cutting Alfonso’s management team will help that. The team tripled its revenue this year.
LG Ads/Alphonso generated approximately $100 million in revenue in 2021, the first year of business under LG’s leadership. The AdExchanger Group generated nearly $300 million in revenue this year, and is targeting more than $500 million in revenue by 2023.
Although LG owns a majority stake in Alfonso, it has agreed to go public within five years from January 2021. If that happens, LG will get equity but lose future profits unless they want to. increase your rate or get a bonus to buy the rest of Alfonso outright.
Launching the leadership could be one way to keep the LG ad business at LG.
Betting on ACR
Back to the official line, LG will continue to invest in its ad tech space.
A key proposition is a targeted solution based on ACR data adjusted for approximately 30 million US households. This information usually comes from LG smart TVs and Alphonso’s OEM partners such as Sharp, Hisense and Toshiba.
LG Ads has AI-powered solutions for audience targeting, reach extension, and campaign measurement tools. Advertisers can buy inventory on LG TVs in partnership with LG Ads.
Despite the privacy concerns surrounding ACR data—for example, it’s not always clear how accurate and informative those smart TV options are—LG appears to be fully on board with ACR.
In the statement Released after an AdExchanger inquiry, said Matthew Durgin, chairman of Alfonso’s board and senior director of LG Electronics USA, that the change will “strengthen the relationship” between Alfonso and LG Ad Solutions and LG Electronics. LG plans to “further develop the company’s ACR capabilities” with its new management.