1. Starving at the feast Why big media is struggling to be part of the advertising boom

2. Media industry is brand new radio TV intenet storytellng outdoor books pamphlets newspaper Print press

3. More media is being produced, for cheaper, than ever before

4. More money is being spent on advertising than ever before

5. Technological change creates media growth across all mediums More demand for advertising from new products and services Unless technlogy is a replacement for old technologies Printing press versus scribes CD vstape DVD vs CD

6. Economies of scale Big media businesses are formed Newscorp Disney Time Warner etc

7. Control access to media Restrict access to competitors Control legislated channels (airwaves) Create scales of economy that thwart new entrants (printing presses, distribution, shelf space) Distribution = market power

8. Imperfect information for advertisers Measurement models drive behavior Circulation vs readership Bundling of content vs actual reads Bulking up advertising per user (actual share of voice is not on the page) Creates and grows from market inefficiences

9. Imperfect information for audience Hard for new media options/competitors to launch Cost to launch (advertising on existing media) Access to airwaves or shelfspace Audience options are limited due to lack of knowledge of alternatives

10. Scarcity drive profits Limited choice enables greater audience on a platform Requires lowest common denominator content vs highest quality content Cheaper to produce content More audience and limited ad breaks equals more profits

11. Welcome the internet Distribution From control to anarchy. Imperfect information From lack of data to in-depth data. Scarcity From limited ad space an audience to unlimited adspaceand audience. From limited content to unlimited content.

12. Distribution Internet erodes government power to create monopolies Reduces switching cost between media to zero Allows anyone to be a media company Glut of choice becomes the challenge (disovery) vs scarcity

13. scarcity Audience utilises multiple media platforms per day due to low switching costs Harder to sell audience specifically as can be reached on other mediums (high substitution)

14. Near perfect information Advertising was sold on wastage Targeting and event based advertising (CPM, CPC, etc) reduce cost of advertising reach Only pay for actual benefit received Advertising spend (in theory) more effective Total reach wastage price target

15. Choice requires better content Better = more relevant for you right now Butterfly enthusiast can publish blog in butterflies Other butterfly lovers love the content but not relevant to most Butterfly lovers also buy BMWs – so BMW can advertise there too OR employ CPC OR employ affiliates

16. Reach vs Relevance Google model based on relevance of ad based on what user is looking for Relevance is better indicator of success than reach CPC is best indicator of relevance

17. Throwing away the rate card Google give advertising away for free! Other media charge you to show your brand Google only charges you if user clicks on your advert (CPC) There is no google rate card Auction based Keywords can be over R100 per click (and still more effective than traditional media) Law of large numbers ensures google make a LOT of money

18. Targeting User tracking is now consistent Cookies Sessions Etc You can use data to target Demographic Behavioral Targeting audience can happen on any site and across sites Retargeting Targeting makes ads more effective

19. Ad Networks and low cost of sales Cost of sales is dropping to zero Makes it easier to buy and sell advertising No more “unsold” media Revenue maximization versus yield management

20. Deal Buyers Sellers Advertiser External “Sales House” Deal Direct Sales Agency/ Ad Network / Affiliate Network AdWords (+ access to GCN) AdSense Workflow (DSM, freewheel does as well) Billing systems (eg SAP) CRM (egSalesforce) Dart Search Google AdX Buyer info Seller info Adsense Backfill MSN Email DFA / other Planning tools (Aprimo, Unica) Publisher Website Adservers DFP / other Private Network eCPM (optimize) Other Ad Exchanges AdECN RighMedia OpenX Advertising.com Adapt (optimize) SSP: Seller Optimizing (Rubicon, Admeld, Pubmatic) DNB, Adify, etc) Media Buyers (vivaki, Atom, cadreon) Ad Networks Vertical, Horizontal, targeted , performance Google CN Video serving with DRM, etc(egInstream, Freewheel Creative Optimization (Teracent, Adready) Demand Side Platforms (DataXu, Turn, InviteMedia) Video players Freewheel, Brightcove Verification Attribution (DoubleVerify, mPire) Analytics(Omniture, GA, etc) Mobile Ad serving Data optimization (Bizo, Quantcast, adchemy) Data Exchanges (Bluekai, eXelate, Rapleaf) Behavioural Targeting Ad Planners (eg Google Ad Planner, Comscore, Akamai) Data suppliers and consolidators (eBay, Expedia) (Business Objects, SAS, Claritas) Implementation, migration & Integration Marketer Services Exchange Brokering

21. DATA Key next battlefront for media owners War may be lost before its even begun Google Microsoft Opportunity to match targeted audience to premium advertiser and command superior yield per ad spot CPC? CPM