One Year after Being Acquired, Hipcricket at Core of Augme’s Strategy

9/5/12Follow @jpruth

There can be a lot of noise in the advertising scene in New York, which overflows with players scrambling for dominance—especially on the mobile front. Mobile marketing and advertising services company Hipcricket, a transplant from the Seattle area, continues to grow in spite of mounting competition.

Hipcricket barged into this crowded landscape one year ago when it was acquired by New York’s Augme Technologies. Still operating as a subsidiary, Hipcricket has quickly evolved into the centerpiece for the company.

Ivan Braiker, co-founder of Hipcricket, says one of the motivations for this marriage was putting the two companies’ services and technologies together into one platform. “Hipcricket was known for SMS and QR codes, but was working with partners for mobile Web [advertising],” Braiker says. “Augme had built a powerful mobile Web platform.”

After Augme acquired Hipcricket in August 2011, New York became the headquarters for the consolidated company, with Paul Arena as CEO and Braiker as president. Hipcricket maintains offices in Kirkland, WA and elsewhere across country.

At the time of the acquisition, the combined company had a staff of about 100 and has since grown to more than 150, according to Braiker. He says Hipcricket became the main operating business of Augme, with its platform used by marketers and brands such as Nestle, Macy’s, and Clear Channel to reach consumers via mobile websites, branded apps, SMS messaging, and other channels.

Hipcricket was not Augme’s only acquisition last year. Princeton, NJ-based Jagtag, a developer of QR codes that could be read by most mobile phones, got snatched up by Augme in July 2011. However, Jagtag’s assets and intellectual property were absorbed into Augme rather than operate as a distinct subsidiary.

Braiker says Hipcricket’s combination with Augme introduced his team to a new side of the technology sector. “We weren’t overly involved in intellectual property and patents,” he says. “It’s been an education to see what goes on.”

Since Augme took ownership, he says Hipcricket has filed applications for more than 20 patents for technology it created for content targeting and analytic systems in the mobile market.

Augme is also locking horns with its rivals on the legal front. In April, the company filed a federal patent infringement lawsuit against Baltimore-based mobile advertising services company Millennial Media. Augme is seeking damages regarding technology from its portfolio it believes Millennial Media has been using. A court date was pending as of mid-August.

Braiker expects competition to intensify even more in mobile advertising as technology evolves and marketers make greater demands of companies such as Hipcricket. Expanding Hipcricket’s sales forces and operations team, he says, will be vital for keeping ahead of the company’s rivals.

“Throughout mobile marketing and advertising, there is a lot of low-hanging fruit,” Braiker says. “None of that fruit just falls off the tree itself. It’s ripe but it needs to be picked.”

João-Pierre S. Ruth is the editor of Xconomy New York. He can be reached at jpruth@xconomy.com and followed on Twitter @jpruth. Follow @jpruth

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