Stay Ahead of the Curve

Insights into Online Display Advertising's Growth

John Triggs, Product Specialist

June 2, 2010
Display Advertising Background:
The very first banner ad ran on October 24, 1994

Publisher: Hotwired.com

AT&T “You Will” campaign

Ad Size/Format: 468 x 60, JPG

© comScore, Inc. Proprietary and Confidential. 2

Display Advertising Background:
AT&T “You Will” campaign predictions

Have you ever:

Received a phone call on your wrist?

Had a classmate who’s 1,000 miles away

Conducted business in a language you don’t understand

Had an assistant who lived in your computer

Tucked your baby in from a phone booth

Watched a movie you wanted to the minute you want to

Carried your medical history in your wallet

Attended a meeting in your bare feet

You will. And the company who will bring it to you? AT&T

For more “You Will” campaign predictions, visit: http://adland.tv/content/banner-ads-tenth-birthday

© comScore, Inc. Proprietary and Confidential. 3

Display Advertising Background:
Fast forward 16 years … AT&T is top display advertiser in Q1 2010

Rank Advertiser Estimated Spend

1 AT&T Inc. $54.1 million

2 Verizon Communications Inc. $46.3 million

3 Experian Interactive $44.8 million

4 Sprint Nextel Corporation $31.4 million

5 Netflix, Inc. $31.1 million

6 General Motors Corporation $27.0 million

7 Progressive Corporation $24.2 million

8 eBay Inc. $22.0 million

9 Procter & Gamble Co. $21.4 million

10 Intuit Inc. $21.1 million

© comScore, Inc. Proprietary and Confidential. 4 Source: comScore Ad Metrix, January-March 2010
Display Advertising Background:
A closer look at Intuit’s display advertising spend

Two observations on Intuit:

Allocated 94% of estimated $33.5M past year display advertising spend for in Jan-Apr 2010

Spent an estimated 2x more on display ads online in March 2010 vs. March 2009

© comScore, Inc. Proprietary and Confidential. 5 Source: comScore Ad Metrix, January 2009 – April 2010
Stay Ahead of the Curve:
Insights into Online Display Advertising's Growth

Display Advertising is Bouncing Back

The Reasons Behind Display’s Resurgence

– Traditional Meets Digital
– Improving Digital Creative and Ad Formats
– The Death of the Click
– Advertising Finally Gets Social

Conclusion

© comScore, Inc. Proprietary and Confidential. 6

Display Advertising is Bouncing Back:
Q1 2010 In Review

U.S. Internet users received a record 1.1 trillion display ads in Q1

15% impression growth

Increased advertiser expenditures

Higher CPMs for publishers

© comScore, Inc. Proprietary and Confidential. 7

Source: comScore Ad Metrix, October 2008 – March 2010
Stay Ahead of the Curve:
Insights into Online Display Advertising's Growth

Display Advertising is Bouncing Back

The Reasons Behind Display’s Resurgence

– Traditional Meets Digital
– Improving Digital Creative and Ad Formats
– The Death of the Click
– Advertising Finally Gets Social

Conclusion

© comScore, Inc. Proprietary and Confidential. 8

The Reasons Behind Display’s Resurgence:
Traditional Meets Digital

Online display advertising in the past:

Traditional advertisers waited on sidelines until effectiveness proven

Click-driven ads offered low effectiveness for brand advertisers

Let’s take a closer

look at Unilever

Online display today:

Consumer Goods companies spent over $100M on Q1 display ads

Procter & Gamble led CPG advertising spend with $17.0M ($21.4M overall)

© comScore, Inc. Proprietary and Confidential. 9

Source: comScore Ad Metrix, January-March 2010
The Reasons Behind Display’s Resurgence:
Traditional advertisers are shifting their media spend towards digital
Unilever – Top Publishers, March 2010 Unilever – Top Products, March 2010

Source: comScore Ad Metrix,

© comScore, Inc. Proprietary and Confidential. 10
November 2009 – April 2010
 The Reasons Behind Display’s Resurgence:
Traditional advertisers are shifting their media spend towards digital

Online branding display ads aimed at target audiences on relevant sites

– All of display ad expenditures for Klondike went to ESPN.com

– 93% of ad impressions for Axe went to Sports & Entertainment sites

Sweepstake (direct responses) display ads focused on reach

– 76% of Bertolli’s impressions delivered on portal sites

– I Can’t Believe It’s Not Butter

focused on these sites:
Portals
Entertainment
Games

© comScore, Inc. Proprietary and Confidential. 11

Source: comScore Ad Metrix, March 2010; comScore Media Metrix, April 2010
The Reasons Behind Display’s Resurgence:
Traditional advertisers are shifting their media spend towards digital

“Rob Master, media director at consumer-product giant Unilever, … says that over the past
year Unilever has "significantly increased" spending on social-media, mobile and online ads.”

- Wall Street Journal, April 26, 2010 Edition

Upfront Market Looks Primed for an Upswing
http://online.wsj.com/article/SB10001424052748703441404575206103291659156.html

Unilever – Advertiser Spend Comparison Across Media, March 2010

Offline spend estimates for TV, Radio, Newspaper and Magazine provided by Competitrack
Online display advertising estimates include static and rich media ads, do not include video, text and other forms of online media

“Online display has become a $17 billion global industry though still small compared to the
$171 billion spent worldwide on TV.”
- Think Display with Google, June 1, 2010:
http://google-au.blogspot.com/2010/06/think-display-with-google.html

© comScore, Inc. Proprietary and Confidential. 12

Stay Ahead of the Curve:
Insights into Online Display Advertising's Growth

Display Advertising is Bouncing Back

The Reasons Behind Display’s Resurgence

– Traditional Meets Digital
– Improving Digital Creative and Ad Formats
– The Death of the Click
– Advertising Finally Gets Social

Conclusion

© comScore, Inc. Proprietary and Confidential. 13

The Reasons Behind Display’s Resurgence:
Improving Digital Creative and Ad Formats

We now have a variety of ad size and ad formats … some better than others

© comScore, Inc. Proprietary and Confidential. 14

The Reasons Behind Display’s Resurgence:
Improving Digital Creative and Ad Formats
Pop-Under 720 x 300, April 2010

The Pushdown 970 x 418 – Top Advertisers, April 2010

© comScore, Inc. Proprietary and Confidential. 15

Source: comScore Ad Metrix, Apri 2010
The Reasons Behind Display’s Resurgence:
Improving Digital Creative and Ad Formats

3 New OPA Ad Formats introduced in July 2009 to:

– Inspire creativity and high-quality advertising
– Provide a greater share of voice for the advertiser
– Introduce a measurement to capture impact
– Enhance interactivity to build user engagement with brands
The Pushdown, 970 x 418

© comScore, Inc. Proprietary and Confidential. 16

Source: comScore Ad Metrix, April 2010
The Reasons Behind Display’s Resurgence:
Improving Digital Creative and Ad Formats

The Fixed Panel, 336 x 860

The XXL Box, 468 x 648

© comScore, Inc. Proprietary and Confidential. 17

The Reasons Behind Display’s Resurgence:
Improving Digital Creative and Ad Formats

Display ads have evolved from static banners to fully engaging
rich media experiences
Nike’s Staring Battle campaign – rich media ad promoting Nike Pro
Football gear that utilizes web cam to allow user to engage in a staring
battle against NFL superstar Adrian Peterson

Prius iMedia banner campaign –

rich media ad instructing user to
interact with ad in different ways,
which subsequently demonstrates
various benefits of the Toyota Prius

© comScore, Inc. Proprietary and Confidential. 18

Source: comScore Ad Metrix, April 2010
The Reasons Behind Display’s Resurgence:
Improving Digital Creative and Ad Formats
PointRoll Rich Media – Top Advertisers, April 2010

EyeBlaster Rich Media – Top Advertisers, April 2010

© comScore, Inc. Proprietary and Confidential. 19

Source: comScore Ad Metrix, April 2010
Stay Ahead of the Curve:
Insights into Online Display Advertising's Growth

Display Advertising is Bouncing Back

The Reasons Behind Display’s Resurgence

– Traditional Meets Digital
– Improving Digital Creative and Ad Formats
– The Death of the Click
– Advertising Finally Gets Social

Conclusion

© comScore, Inc. Proprietary and Confidential. 20

The Reasons Behind Display’s Resurgence:
The Death of the Click

Clicks are easy to measure, but bear little relationship to the actual impact of
the campaign on consumers

Click-through rates now average around 0.1%

© comScore, Inc. Proprietary and Confidential. 21

The Reasons Behind Display’s Resurgence:
The Death of the Click

Advanced metrics to measure effectiveness of online advertising with

differing goals (offered by comScore)
– Branding lift
– Online behavior lift (keyword search, site visitation)
– Offline sales impact
– Online sales lift
– Other campaign metrics such as reach, frequency, demographics and GRPs

Other creative ways to measure campaign performance

– Group buying sites drive offline sales through online advertising
– Groupon.com offers pure performance package to local businesses

© comScore, Inc. Proprietary and Confidential. 22

Performance Marketing Success Story:
Group Buying is growing exponentially…and the money is following

4,000
U.S. Unique Visitors (000)
3,500
3,000
2,500
2,000
1,500
1,000
500
0

LIVINGSOCIAL.COM GROUPON.COM % Composition by Gender

GROUPON.COM LIVINGSOCIAL.COM Total Internet

62%
Females 67%
50%

38%
Males 33%
50%

© comScore, Inc. Proprietary and Confidential. 23 Source: comScore Media Metrix, April 2010
Performance Marketing Success Story:
Display ads help Groupon.com build brand and scale faster

© comScore, Inc. Proprietary and Confidential. 24

Source: comScore Ad Metrix, April 2009 – April 2010
Performance Marketing Success Story:
Groupon.com display advertising observations

Arbitrage – acquire consumers

through display advertising and sell
to local businesses at higher rate

Pure performance marketing –

online drives offline with more
relevant metrics beyond the click

Display advertising is favored direct

response strategy, over search, for
driving traffic to Groupon.com

April 2010: 310 million display ad impressions vs. 70,000 paid search clicks

© comScore, Inc. Proprietary and Confidential. 25

Source: comScore Marketer
Stay Ahead of the Curve:
Insights into Online Display Advertising's Growth

Display Advertising is Bouncing Back

The Reasons Behind Display’s Resurgence

– Traditional Meets Digital
– Improving Digital Creative and Ad Formats
– The Death of the Click
– Advertising Finally Gets Social

Conclusion

© comScore, Inc. Proprietary and Confidential. 26

The Reasons Behind Display’s Resurgence:
Advertising Finally Gets Social

The Pushdown, 970 x 418

© comScore, Inc. Proprietary and Confidential. 27

Source: comScore Ad Metrix, April 2010
The Reasons Behind Display’s Resurgence:
Advertising Finally Gets Social

© comScore, Inc. Proprietary and Confidential. 28 comScore Media Metrix, April 2008 – April 2010
The Reasons Behind Display’s Resurgence:
Advertising Finally Gets Social

“According to the Web-research

firm comScore, Facebook flashed
more than 176 billion banner ads
at users in the first three months of
this year — more than any other
site.”

Advertisers follow eyeballs … social

networking sites now drive over 25% of all
display ad volume (by impressions)

Despite their incredible volume, average CPM
for social networking sites is currently $0.55 –
about 5x less than average Internet CPM

© comScore, Inc. Proprietary and Confidential. 29

Source: comScore Ad Metrix, January 2009 – March 2010
The Reasons Behind Display’s Resurgence:
Advertising Finally Gets Social
Social Media CPMs are low compared to other publisher categories

Top Publisher Categories Cost per Thousand

Share of Total U.S. Internet Display Ads Impressions (CPM)

Social Networking 27% $0.55

Portals 21% $2.69

Entertainment 11% $4.53

e-mail 10% $0.89

News/Information 8% $5.63

Sports 3% $6.35

Online Gaming 2% $2.70

Lifestyles 2% $2.72

Business/Finance 2% $10.41

Retail 2% $2.59

Total Internet CPM = $2.55

© comScore, Inc. Proprietary and Confidential. 30
Source: comScore Ad Metrix, March 2010
The Reasons Behind Display’s Resurgence:
Advertising Finally Gets Social

Social value + targeting:

Social ads can incorporate social value with strong demographic &
psychographic targeting capabilities

Massive channel:
Advertisers need to pay attention to this massive advertising channel

Focus on right metrics:
They need to reevaluate opportunities and focus on the right metrics – view-thru,
not click-thru

Grow publisher CPMs and overall advertising market:
As this continues to happen, CPMs will inevitably increase and it will drive
continued growth in online advertising

Facebook Ads

© comScore, Inc. Proprietary and Confidential. 31

Conclusion

Display advertising is bouncing back:

Total display ad impressions have grown 15% since Q1 2009, with increased advertiser
expenditures and higher CPMs for publishers

Reasons for display’s resurgence:

– Traditional advertisers such as Unilever are shifting their media spend towards digital
– Innovative new ad sizes and formats are inspiring creativity, enhancing interactivity and
providing a more voice to the advertiser
– Advanced metrics to measure effectiveness of online advertising are enabling
advertisers to successfully evaluate and optimize their campaigns
– Social advertising presents new opportunities as time on social networking sites grows
and new advertising capabilities evolve

All insights in today’s webinar provided by comScore Ad Metrix.

© comScore, Inc. Proprietary and Confidential. 32

 Conclusion:
Ad Metrix provides easy access to rich display advertising insights

User-Friendly:

Ten Quick Reports to uncover rich

new insights on any advertiser,
product, or publisher in no time:
– Top sales prospects
– New advertisers
– 6-month advertising trend
… and more!

Download customizable set of up

to 100 creative for advertiser,
product, or publisher … and view
customized report containing key
details and thumbnail images.

Rich Advertising Insights:

Unmatched Depth & Granularity

People-Based Measurement

Single Source for Advertiser &
Publisher Intelligence
© comScore, Inc. Proprietary and Confidential. 33
Source: comScore Ad Metrix
Questions?

Thank you!

Feel free to email John Triggs at: jtriggs@comscore.com

For more information on Ad Metrix, please visit:

http://www.comscore.com/Products_Services/Product_Index/Ad_Metrix

© comScore, Inc. Proprietary and Confidential. 34

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