Panel Ii Data Driven Performance Marketing
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The document summarizes key points from a panel discussion on data-driven performance marketing at Jefferies & Company's 3rd Annual Internet Conference in February 2007. The panelists represented advertising networks and web analytics companies. Some of the topics discussed included the problems advertising aims to solve, how advertisers are allocating their spending online, the major players in advertising networks and web analytics, and questions posed to the panelists.
Panel Ii Data Driven Performance Marketing
- 1. Jefferies & Company, Inc. Jefferies 3 rd Annual Internet Conference February 28, 2007 CONFIDENTIAL DRAFT Member, SIPC Panel II: Data Driven Performance Marketing
- 2. Panelists Joe Davis CEO David Liu Managing Director Internet & Digital Media Group Gurbaksh Chahal CEO Josh James CEO Art Shaw CEO Panelists are representative of the data driven performance marketing industry Advertising Networks Web Analytics Content Sites 1
- 4. What Problem are We Solving? "I know half the money I spend on advertising is wasted, but I can never find out which half" - John Wanamaker “ Let advertisers spend the same amount of money improving their product that they do on advertising and they wouldn't have to advertise it ” - Will Rogers "Advertising is on its deathbed and it will not survive long, having contracted a fatal case of new technology" - Roland T. Rust and Richard W. Oliver 3
- 5. What is the Online Marketing Opportunity? Online Advertising Revenue 2005-2010E 1 Web Analytics Software Revenue, 2005-2010E 2 Source: Jefferies Research, 2006. Revenues include ad spend on search, display, text, and other advertising media. Does not include web analytics spend. Source: IDC, 2006. ($ billions) ($ millions) 21.4% CAGR 15.5% CAGR 4
- 6. How Are Advertisers Spending Their Money? Direct Response Display Paid Search Branded Display Source: MediaPost & InsightExpress survey of 39 online media profiessionals, July 2006. Affiliate E-mail Other Advertising Spend Allocation – Q2 2006 1 5
- 7. Who are the Advertising Network Players? Note: Public companies labeled black; private companies labeled blue. Source: comScore Media Metrix, February 2007. * January 2006 statistics not available - DRIVEpm growth from March 2006; Euroclick growth from November 2006. (millions) Total Unique Visitors – January 2007 1 Advertising.com ValueClick Tribal Fusion Casale Media VendareNetblue Blue Lithium 24/7 Real Media DRIVEpm* Burst Media Euroclick* Role of Ad Networks Marketplace matching advertisers and Website publishers For Advertisers Outsourced placement and distribution of ads Create, plan, optimize, and report campaigns Broad reach and price economies of scale For Publishers Cost-effective means of selling inventory Handle payment, processing: “love those checks!” 6 29% 39%* 25% 29%* YoY Growth 23% 7% 15% 42% 58% 34% 148.4 129.7 115.9 109.9 101.1 94.9 90.5 88.2 77.0 75.1 0 20 40 60 80 100 120 140 160
- 8. Who are the Web Analytics Players? Omniture WebSideStory Coremetrics / Surfaid SAS Institute Sane Solutions Other SPSS WebTrends Source: IDC, June 2006. Web Analytics Market Share – 2005 1 Note: Public companies labeled black; private companies labeled blue. Role of Web Analytics Provide visitor behavior metrics to online marketers Marketers leverage these metrics to make data driven decisions resulting in more efficient spending and higher conversion rates Ensure advertisers and publishers are staying honest! 9.5% 12.9% 16.0% 9.7% 43.5% 4.4% 1.9% 2.1% 7
- 9. Meet the Panelists 8
- 10. Dave’s Top Ten 9
- 11. Dave’s Top Ten We keep hearing about behavioral targeting. Are there any privacy concerns? Will all advertising go performance based? Agree or disagree? “ Online fraud is out of control!” “ Getting an accurate ROI is a pipe dream” “ Online marketing will always suffer from leakage ” Do you believe advertising networks and Web analytics companies compete? Why or why not? 10. How are you exploiting the proliferation of rich media and video on the Web? 1995 1996 1997 1998 1999 2000 10
- 12. Dave’s Top Ten (Cont.) If you could LONG or SHORT any stock to exploit the next phase of data driven performance marketing what would it be? If you could start ANY Internet based business in 2007 what would it be? Hot or not? Yahoo’s Panama Microsoft’s adCenter Auction based online advertising models Who loses the most if you gain? Traditional media? Other online marketers? What is your biggest competitive threat? What are the big Internet companies doing? Worried? 2001 2002 2003 2004 2005 2006 11