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  • digital.direction white papers: ADVERTISING

    An in-depth look at the digital advertising industry

    2. Interactive advertising a new value chainDigital advertising is reshaping the value chain, we examine the changes and the new players

    Property of digital.direction. www.ddrxn.com

    THE PAPER IN BRIEF

    A new value chain is forming in response to increasing spending on digital media. Advertisers have benefited from the wider

    variety of advertising formats and the ability to target consumers more precisely. Advertising agencies and media distributors

    gain when they invest in the expertise and infrastructure to develop and integrate their digital services into the overall

    marketing mix. Newer intermediaries in the value chain, ad networks and exchanges, have captured a significant share of digital

    ad spend by forming a crucial link between advertisers and media distributors.

    We discuss the background of these changes and examine the major trends that are reshaping the industry.

  • Managing Director of Yahoo! SEA, where he oversaw

    Yahoo!s expansion into Singapore, Malaysia, Thailand,

    Interactive advertising a new value chain

    REZA BEHNAM

    CO-FOUNDER/PARTNER

    Reza is a co-founder and Partner

    at Digital Direction. Reza leads

    our Digital Business-to-Consumer

    practice.

    Most recently, Reza was the

    FREDERIC DE BURE

    CO-FOUNDER/PARTNER

    Frederic is a co-founder and

    partner of Digital Direction.

    Frederic leads our Digital

    Business-to-Business practice.

    Frederic is also a General Partner

    in the IDG Ventures SEA fund and co-leads investment and

    management decisions of the fund portfolio companies, and

    Digital Direction is a digital consulting firm. We are strategy

    architects, helping our clients CREATE, GROW and IMPROVE

    their digital businesses in Southeast Asia.

    We have created strategies, built services and generated

    revenues at some of the biggest names in the online industry,

    all of which gives us a good idea of how to create a successful

    digital business. This means looking at the big picture to

    provide clear answers to business challenges, as well as

    focusing on implementation to deliver rapid change.

    Our consulting team is passionate about its subject, creative

    in its approach to problem-solving and highly skilled in its

    ability to get things done quickly and efficiently.

    We can apply our ideas, insight and practical knowledge to

    help your business thrive.

    ABOUT DIGITAL DIRECTION

    Yahoo!s expansion into Singapore, Malaysia, Thailand,

    Philippines, Indonesia and Vietnam. He was in charge of

    running end-to-end planning and operations including long-

    term strategic planning, sales, partnerships, marketing,

    distribution, product-development, and engineering for all

    six markets.

    Prior to joining Yahoo!s international operating

    management, Reza was the Director of Global Alliances at

    Yahoo!s headquarters in the United States where he

    successfully managed a strategy, business development, and

    solutions-delivery team. In this role Reza played a lead role

    in devising Yahoos Digital Home Strategy which later

    culminated into the Yahoo! Go for TV product suite. Reza

    also has over nine years of experience as a management and

    marketing strategy consultant to Global 500 companies and

    Internet start-ups. Earlier in his career, he also worked at

    Intels headquarters in California as a corporate marketing

    strategist/scientist.

    Reza is a graduate of Boston University with a BA in

    Mathematics and Economics and a MA in Economics.

    Property of digital.direction. www.ddrxn.com 2

    management decisions of the fund portfolio companies, and

    sits on the boards of on a number of boards. Frederic has

    been involved in many transactions involving data centric

    models, including a number of online gaming transactions

    and mass storage business models.

    Frederic was Managing Director for SEA for eBay, Inc., where

    he was responsible for the daily operations of eBays business

    in the region. His goals focused on building an extensive

    network of relationships throughout Asia to effectively grow

    the companys operations in the region. In this capacity, he

    sourced, negotiated and built all major initial partnerships for

    the company. These included Yahoo, Google, MSN, and

    Hardwarezone, and totalled 100% of the yearly marketing

    budget. Prior to heading SEA for eBay, Frederic was

    responsible for the international payments services group at

    eBay. Prior to joining eBay, Frederic was a Founder and

    Director of Strategy for Commonstream, Inc., the first online

    wastewater treatment supply chain management company in

    the US.

    Frederic holds a BA in International Relations from Vassar

    College, and an MBA in Finance, Marketing and Strategy from

    the University of Chicago.

  • the UK, holding a number of positions with FT.com and other

    digital businesses.

    He is an experienced project manager and has completed

    numerous consumer behaviour research projects. He

    recently led a usability study for a US social networking site

    with 100m+ users. This investigated the needs of users of the

    site in key markets across Southeast Asia and resulted in a

    significant re-focusing of product development strategy in

    order to bring the changes highlighted to market quickly.

    While at the FT, Mark led the commercial product

    development team focusing on strategies to maximise digital

    revenues through improved design and content. In this

    ABOUT DIGITAL DIRECTION

    McKinsey & Co. Greater China & Southeast Asia. As part of

    the Telecom, Technology & Multimedia Practice, he

    developed strategies for leading Global and Asian

    companies. He served establish telecom operators and a new

    entrant in Asia on corporate strategy, business building and

    corporate finance issues. In addition, he helped develop the

    global strategy for a leading Asian handset brand as well as

    designing and implementing an operational improvement

    plan for one of its components businesses. More recently,

    Matt has served leading companies, such as global retailer

    A.S. Watson, leading India cellular operator Bharti-Airtel and

    global bank HSBC through an India-based analytics and

    database services company he co-founded. In 2000, he was

    the part of the original team that launched Qualcomms

    MATTHEW AUJLA MANAGING

    DIRECTOR

    Matt is the Managing Director of

    Digital Direction. Matt leads client

    service and internal operations.

    Matt has 13 years experience as a

    strategy consultant in Asia. He

    was a Consultant and Manager at

    MARK SUCKLING CONSULTANT

    Mark is a consultant and project

    manager at Digital Direction. Mark

    leads our usability service line.

    Mark has 10 years experience in

    the digital media industry,

    primarily at the Financial Times in

    Interactive advertising a new value chain

    revenues through improved design and content. In this

    capacity, Mark also played a key role in managing the

    successful transition of key advertising clients from print to

    digital media.

    Mark holds an MBA from INSEAD and an MSc from Kings

    College, University of London.

    Property of digital.direction. www.ddrxn.com 3

    the part of the original team that launched Qualcomms

    wireless internet platform BREW. Matt began his career at

    IDC Asia Pacific consulting clients, such as IBM, Compaq and

    Intel, on distribution channel strategies across 13 markets in

    Asia.

    MBA from the Darden Graduate School of Business at the

    University of Virginia and has a BA, through the Business

    Leadership Program, from the University of Puget Sound.

    SINGAPORE - MAIN OFFICE

    80 Tras Street, #01-03, Singapore 079019 | Tel: +65 6549 5660 | Fax: +65 6410 9545

    Please contact us with any queries at direction@ddrxn.com

  • EXECUTIVE SUMMARY................................................................................................

    OVERVIEW OF CHANGES TO THE VALUE CHAIN.........................................................

    INCREASE IN CONSUMER POWER..............................................................................

    NEW OPPORTUNITES AND CHALLENGES FOR ADVERTISERS.....................................

    MEDIA DISTRIBUTORS CONSOLIDATION AND FRAGMENTATION............................

    ADVERTISING AGENCIES NEW STRUCTURES AND ROLES..

    ADVERTISING ENABLERS NEW INTERMEDIARIES.

    5

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    CONTENTS

    Interactive advertising a new value chain

    Property of digital.direction. www.ddrxn.com 4

  • thousands of sources of digital media. Accordingly,

    understanding consumer behaviour and targeting advertising

    continues to prove a major challenge. One exception to this is

    the one digital channel that most of the internet world does

    look at - Google. Google has become almost synonymous with

    paid search for advertisers and media distributors. It reaches

    70% of internet users, and as a result captures a third of all

    advertising money spent online. Google provides only a

    partial solution for advertisers, as its particular form of

    advertising drives direct response which is only one objective

    of advertising. The communication of brand mess