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Real Marketing How the Power Shifts to Consumers (and what Marketeers Need to Understand)

Arndt C. Groth, CEO, PubliGroupe Ltd. Zurich, 21.11.12

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More Than Just Technology For the First Time Consumers Are in the Driving Position

"In a few hundred years, when the history of our time is written from a long-term perspective, it is likely the most important event historians will see is not technology, but the unprecedented change in the human condition. For the first time, people have choices."

Peter F. Drucker American management consultant, educator, and author, whose writings contributed to the philosophical and practical foundations of the modern business corporation

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Agenda

Business Talk with Arndt Groth Time (hrs:mins)

Responsible

Annual

Greeting and Introduction

Presentation PubliGroupe

Discussion

Apéro Riche / Networking

Closing

16:30 - 17:00

17:00 - 17:30

17:30 - 18:15

18:15 - 18:45

18:45 - 19:45

20:00

All

Prof. Dr. Ch. Belz

Arndt C. Groth

All

All

All

1

2

3

4

5

6

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Agenda 3 Chapters

1 6 Backgrounds in Real Customer / Corporate Behavior and Business Environment - #1 Background: Massive Change in Media Usage - #2 Background: Negative Impact to Classic (Offline) Media - #3 Background: Total Information Overload - #4 Background: More and More Competitors in the Same Market - #5 Background: Less USP’s – Not Even A UAP - #6 Background: New Ecosystems Emerge

2 6 Learnings for Real Marketing and Communication - #1 Learning: Likes (in Social Media) Are Completely Overrated - #2 Learning: Video – The Next Big Thing - #3 Learning: Think Mobile – Act Mobile - #4 Learning: ROI Optimization Is More Than Turn the Regulator - #5 Learning: Real Marketing Needs Realtime Advertising - #6 Learning: Deep Understanding of Customer Behaviors (Customer Journey)

3 4 Results for PubliGroupe - #1 Result: Preparing for the New Digital Marketing World (Organisation) - #2 Result: Orchestrate Profitable Growth (DSP – SSP) - #3 Result: Focus On Customers and Partners (Strategy) - #4 Result: Walk As We Talk (6 Take Aways)

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Background

01

Massive Change in Media Usage

7

The Consumption of Media Is Shaped by Digital Media Media Usage: ! Hours per Week

Source: Microsoft

0

10

20

30

40

50

60

70

80

90

100

1960 1980 2000 2020

Print

1920 1940

Analog Radio

Kino

Outdoor Digital Radio

Mobile

Games

Internet

Analog TV

Digital TV

! 80h

8

Online Usage in Competition to Traditional Media Development of Usage by Reach in % in Switzerland

Source: WEMF, MACH Cinema Basic, NET-Metrix, Net-Metrix Profile

9

Our Daily Life with Digital Media

Source: Tomorrow Focus Media

10

Background

02

Negative Impact to Classic (Offline) Media

11

2012e

1,884

550

2011

2,004

543

2010

2,001

533

2009

1,915

517

2008

2,406

527

2007

2,487

516

2006

2,369

497

2005

2,299

479

2004

2,294

467

2003

2,302

455

1.  GDP calculation based on production statistics Ad spend Print in CHF m GDP in CHF bn1

-0.1%

-12.3%

2.3%

4.0%

2.6%

2.5% 0.1% 3.8%

1.3%

Forecast

-6.0%

Massive Pressure on Print The Latest Loss of Print Ad Revenues Went Beyond Expectations

Source: WEMF; Stiftung Werbestatistik Schweiz; IMF; SECO; OC&C analysis

Print ad-spend vs. GDP, Switzerland

12

48%

30%

4% 1%

7%

10%

Printmedien

TV

Radio

Kino

Teletext

Internet

Plakat

Digitale Werbeflaechen

Mediengattung Mio. CHF

Printmedien 2'288.892

TV 1'449.903

Radio 183.855

Kino 28.996

Teletext 8.322

Internet 344.500

Plakat 465.183

Digitale Werbeflächen 11.859

Gesamt 4'782.500

Sofern bei Internet die Umsätze der Classified Plattformen (Job-, Immo- und Auto) dazugerechnet werden steigt das Volumen auf CHF 520.8 Mio. Internet wäre somit an 3. Stelle vor Plakat!

Market Shares by Media in 2011 in Switzerland

Source: MediaFocus, Brutto Werbeaufwendungen und Online-Werbestatiistik in Mio. CHF

13 Source: WARC / IAB Europe / Screen Digest

Switzerland not in the Top 10 Share of Online by Media Mix in EU [Online spend as % of main media]

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But the High Potential is Still Not Identified Time Spendings vs. Advertising Spendings

Source: Morgen Stanley 16. Nov. 2010 / KPCB "Internet Trends 2012"

12%

16%

31%

28%

7%

15%

43%

26%

10%

26%

9%

39%

13%

25%

11%

42%

22%

1% 0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Print Radio TV Internet Mobile

Time Spent 2010 Time Spent 2011 Ad Spend 2010 Ad Spend 2011

! $ 50B Global Opportunity

Internet Ad = $30B

Mobile Ad = $1.6B

! $ 20B Opportunity in USA

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Background

03

Total Information Overload

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Digital Media Can’t Replace Real Life Activities But Can Enrich Our Digital Lifestyle

Source: Manfred Spitzer – Digitale Demenz

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Background

04

More and More Competitors in the Same Market

19

Display Advertising Ecosystem Europe in 2012

Source: Improve Digital

We Are Here

21

Background

05

Less USP’s – Not Even A UAP

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Lack of Relevance Brand Experience Gap – Homeless Communication

23

Background

06

New Ecosystems Emerge

24

New Players with New Biz Models Enter the Market iTunes As Worldwide the Biggest Distributor for Digital Content

25

Free, Freemium

or Premium?

ROI? Optimized Budget?

What About Social Media?

Stand Alone or

Cooperation?

Quantity or

Quality?

Who's the Typical User?

How Can We Help Advertisers and Publishers? To Reduce Complexity?

Where to

Buy?

26

Learning

01

Likes Are Completely Overrated

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Involvement I feel involved with

this brand

Influence I would recommend

this brand

Intimacy This brand is very much present in my daily life

Interaction This brand stimulates interaction with itself

The New Engagement Paradigm From 4 P's to 4 I's

Source: Butterfly Media

Brand Engagement

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Learning

02

Video – The Next Big Thing

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Online Video Will Soon Overtake Broadcast TV Hours:Mins spent Watching Video per Week

Source: TDB / iBusiness, 14.05.2010

> 72 h = Video-Upload on YouTube per Minute! > 3 h = Video-Upload on YouTube per Minute with Mobile Devices

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Learning

03

Think Mobile – Act Mobile

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•  Shortcut:

•  QR-Code:

•  Augmented Reality (Visual Search):

•  Interactive Advertising:

Interactive Offline-2-Mobile Possibilities Generates More Value and Experience for Customers

32 Source: Namics

Not Technology But User Experience in the Focus Responsive Design for the Same Content On Every Digital Channel

33

Learning

04

ROI Optimization Is More Than Turn the Regulator

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Marketing Goals

Awareness Interest Action Desire

CPM Cost per Mille

Contacts Reach

CPC Cost per Click

Visitor / User

CPS Cost per Sale

Sales

Display / Brand Advertising

Search Advertising

Performance Advertising

The CPM-Based Pricing Model Is Not Dead But Performance-Based Models Tends to Create More Transparency

CPC

C

ost p

er C

lick

CPL

C

ost p

er L

ead

CPO

C

ost p

er

Ord

er

CPA

C

ost p

er

Act

ion

Performance Modelle Performance Models User

Banner Ads Text Ads

eMail Contextual Ads

Keywords

Advertising

35

Learning

05

Real Marketing Needs Realtime Advertising

36

1592 1641 1651 1801

2008 62 149 252

366 495

0

500

1000

1500

2000

2500

3000

2011 2012 2013 2014 2015

Klassisch RTA-basiert = ! 20% of all Online Display Ad Spendings

Online Display Advertising Spendings RTA Is Strongly Gaining Relevance In Germany [in Mio. $ US]

CAGR 11%

68%

6%

37

The Future of Display Advertising in 2020

38

Learning

06

Deep Understanding of Customer Behaviors

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360° View – The Right Crossmedia Mix Analysis for More Sales-Performance & Positive Brand-Association

Source: Accelerom

The

right

clie

nts

(and

non

-clie

nts,

em

ploy

ees,

sta

keho

lder

) …

know

of a

par

ticul

ar b

rand

to invest in the right touchpoints for the relevant target audience

to initiative and manage the right m

arketing processes for acquisitions, custom

er retention and branding

40

KPI’s in 360° Controlling Aggregated in an Integrated Reporting

Source: Namics

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Big Data – The New Oil Analytics of All Kind of Insights (Product, Service, Customer …)

Source: SAS

42

Do You Know the Value of Your Touchpoints? The Customer Journey and the Performance of Various Touchpoints

43

Attribution Modeling - Audience plus Performance Data Improves the Relevance of the Advertising Delivery

Source: Quisma

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Result

01

Preparing for the New Digital Marketing World

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Performance-Oriented Full-Service Provider Organized into 3 Segments, Emplying State-of-the-Art Data Tools

Search & Find

Producer and seller of media products facilitating the search for persons, companies, products and services focusing on local markets.

Digital & Marketing Services

Portfolio of leading international marketing and technology service companies, helping brand owners to spend marketing budgets more effectively.

Media Sales

Preferred partner for media owners and advertisers worldwide, using effective advertising solutions.

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•  PubliGroupe is a leading Swiss-based provider of marketing and media sales services, enabling advertisers to spend their marketing budgets more effectively and allowing media owners to help monetise their reach more successfully.

•  Ultimate goal is to make marketing processes more effective for their clients, be it in traditional or digital media.

PubliGroupe Marketing.More.Effective.

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Result

02

Orchestrate Profitable Growth

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Agency Publisher Demand-

Side Platform

Supply- Side

Platform

Ad Exchange

Ad Network

Agency Trading

Desk

Digital display ecosystem and selected Google & PubliGroupe investments

+ acquisition of Wildfire interactive for social media marketing solutions

Digital Ecosystems Remains Complex PubliGroupe with Stakes Across the Entire Digital Display Ecosystem

Source: IAB; Google; Press

AD

VER

TISE

R

AU

DIE

NC

E

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Online Revenues with Strong Growth Good Progress with Consolidated and Associated Online Revenue

113 140 162

380

517 548

0

100

200

300

400

500

600

700

800

•  Consolidated online revenue grows by 15.5%; incl. participations growth represents 18% at constant fx

•  Online revenue reaches 40% of total business revenue; in terms of gross margin, online represents 50%

•  Growth mostly from Zanox and Namics: Zanox CAGR 29% since creation of the joint venture in 2007; Namics with 14% of continuous organic growth since 2004

•  Media Sales with CHF 50 m online sales

Online Revenues, in millions of CHF

PubliGroupe Associated companies

Total revenue 2010: CHF 1’906 m (online 34%)



493

2009 2010 2011

657 710

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Result

03

Focus On Customers and Partners

51

MSN

The group has more than 400’000 customers: •  Private persons •  SME •  National advertisers •  International brands

The group cooperates with: •  Well-known media companies •  Digital Media owners •  Different types of websites

PubliGroupe Customers and Partners

52

Switzerland and Europe Largest Markets Geographical Distribution

53

Result

04

Walk As We Talk

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6 Take Aways For More Effectiveness in Your (Digital) Marketing Strategy

SOCIAL: Communities + Engagement = MME (Marketing.More.Effective.) 1

VIDEO: All-Screen-Planning = MME (Marketing.More.Effective.) 2

MOBILE: Smartphone + Local = MME (Marketing.More.Effective.) 3

PERFORMANCE: CPM + CPx = MME (Marketing.More.Effective.) 4

REALTIME: RTA = ! CPA + ! Conversion = MME (Marketing.More.Effective.) 5

CUSTOMER JOURNEY: 360° + Attribution Modeling = MME (Marketing.More.Effective.) 6

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Thank You for Your Attention

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