1.Copyright 2009 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. Philipp Stauffer Managing Partner, Digital Strategy and Marketing Sciences NAB Key Note, April 2009 The Billion Dollar Question: Monetizing the Digital Opportunity

2. 2Copyright 2009 Accenture All Rights Reserved.Copyright 2009 Accenture All Rights Reserved. http://bit.ly/1cAMKJS Key Note Presentation: Philipp Stauffer, Managing Partner, Accenture Advertising Innovations Summit, April 2009 3. 3Copyright 2009 Accenture All Rights Reserved. The digital consumer is in control, on the move, connected and creative. The End of the Funnel (Not the Tunnel) Copyright 2009 Accenture All Rights Reserved. 4. 4Copyright 2009 Accenture All Rights Reserved. The digital consumer is in control, on the move, connected and creative. The Future of Monetization $ Copyright 2009 Accenture All Rights Reserved. 5. 5Copyright 2009 Accenture All Rights Reserved. 50%Non-accountability gets penalized Supply / demand plays 26%Accelerated print decline Copyright 2009 Accenture All Rights Reserved. 6. 6Copyright 2009 Accenture All Rights Reserved. 6 The world is changing Life used to be easy. WebsiteBanner Search But the consumer changed. Banner Video Mobile Organic Search informentertain Com- munity connect IP TV Email Print TV Lead Gen Rating Sites Blogs Paid Search Direct Mail assist Widgets Social convert Call CentreRep Website 7. 7Copyright 2009 Accenture All Rights Reserved. We try to make non-digital models work in digital and miss the opportunity to truly transform We borrow the ad format. We borrow the limits. We borrow the business model. We borrow the pricing model. We borrow the media planning process. We borrow the media buying process. Something is broken We are all frame blinded 8. 8Copyright 2009 Accenture All Rights Reserved. At the end of the day we all want to influence choice. The world is moving from push-marketing to influence marketing. From push to influence Copyright 2009 Accenture All Rights Reserved. 9. 9Copyright 2009 Accenture All Rights Reserved. The new marketing literature Copyright 2009 Accenture All Rights Reserved. 10. 10Copyright 2009 Accenture All Rights Reserved. The digital consumer is in control, on the move, connected and creative. How can we influence choice? Dialogue. Copyright 2009 Accenture All Rights Reserved. 11. 11Copyright 2009 Accenture All Rights Reserved. Customer How can we influence choice? User/Viewer Marketer Copyright 2009 Accenture All Rights Reserved. 12. 12Copyright 2009 Accenture All Rights Reserved. The digital consumer is in control, on the move, connected and creative. Copyright 2009 Accenture All Rights Reserved. 13. 13Copyright 2009 Accenture All Rights Reserved. Awareness Consider Purchase Usage Loyalty Forced Message Push Traditional marketing funnel 14. 14Copyright 2009 Accenture All Rights Reserved. Spectrum of opportunity for interaction to influence choice Few dialogue opportunities Awareness Consider Purchase Usage Loyalty Untapped opportunity to influence choice through dialogue/interaction Seized opportunity to influence choice through dialogue/interaction Constrained dialogue. Little influence. 15. 15Copyright 2009 Accenture All Rights Reserved. Influence vs. push More & earlier dialogue opportunities Unlimited opportunity of dialogue X The new engagement paradigm The end of the funnel as we know it Awareness Consider Purchase Usage Loyalty Spectrum of opportunity for interaction to influence choice Untapped opportunity to influence choice through dialogue/interaction Seized opportunity to influence choice through dialogue/interaction 16. 16Copyright 2009 Accenture All Rights Reserved. Every dot is an opportunity to drive desired outcomes 17. 17Copyright 2009 Accenture All Rights Reserved. Unfortunately, engagement goes both ways Source: YouTube.com, April 10 2009 >4300 Comments 4/17/09 Wed, 4/15/09 Train the roots; influence what you control Coupon Ad for Dominos? 18. 18Copyright 2009 Accenture All Rights Reserved. The digital consumer is in control, on the move, connected and creative. Every orange dot is a missed opportunity to engage. That is where the opportunity is. Engagement Copyright 2009 Accenture All Rights Reserved. 19. 19Copyright 2009 Accenture All Rights Reserved. The digital consumer is in control, on the move, connected and creative. So how can we make money from the orange dot? Making money Copyright 2009 Accenture All Rights Reserved. 20. 20Copyright 2009 Accenture All Rights Reserved. Perceived Relevance Revenue Model This is very valuable to me I am happy to pay for this I could do what I wanted to do Easily Freely Subscription Virtual good Pay per use What is the consumers mindset? Free Trial Free Copyright 2009 Accenture All Rights Reserved. 21. 21Copyright 2009 Accenture All Rights Reserved. Radiohead: Pay what you want Source: Screenshots from Radiohead website 22. 22Copyright 2009 Accenture All Rights Reserved. Increased profits Source: comScore study 11/5/07 Global Downloads from Radiohead Band Website Provided higher profits to the band than traditional approach Consumer Defined Price 23. 23Copyright 2009 Accenture All Rights Reserved. Twitter Phenomenon Source: Twitter.com New Publishing New Search 24. 24Copyright 2009 Accenture All Rights Reserved. Buy App for $9.99 without ads. Free / Ads Pay / No Ads Consumer Choice on Monetization Model What about making paid content relevant for user: win-win? 25. 25Copyright 2009 Accenture All Rights Reserved. 2 Chinese Online Success-Stories Changyou Tencent / QQ Source: Changyou.com, Tencent.com 26. 26Copyright 2009 Accenture All Rights Reserved. Customer How can we influence choice? User/Viewer Marketer Copyright 2009 Accenture All Rights Reserved. 27. 27Copyright 2009 Accenture All Rights Reserved. Marketers want to increase their ability to measure impact on desired outcomes and incrementally optimize results based on quantitative insights. Performance Marketing Copyright 2009 Accenture All Rights Reserved. 28. 28Copyright 2009 Accenture All Rights Reserved. Outcome / Result I reached the desired outcome Revenue Model I pay based on results Increased CLV by 10% in 3 months -half of the increase can be attributed to digital activity 1, 2, 3) -my analytics show me exactly how to further optimize CPA* CPL CPC CPM (cannot be the model of the future) * Cost per Acquisition, not Cost per Action CPDO** **CPDO: Cost per Desired Outcome What is (or increasingly will be) the marketers mindset? Copyright 2009 Accenture All Rights Reserved. 29. 29Copyright 2009 Accenture All Rights Reserved. The bailout video Will it blend Source: Screen capture from www.youtube.com Retail sales up 500% since company started campaign in 2007 Will it blend series draws more than 60 million viewers within first year 84 videos in series 190K subscribers 30. 30Copyright 2009 Accenture All Rights Reserved. Source: Videoegg.com Videoegg with desired outcome based ad service (format + pricing) LIVE LOCAL RICH SHOP SHARE Marketing Objective Product / Pricing Video / Blogs 31. 31Copyright 2009 Accenture All Rights Reserved. Customer User/Viewer Marketer How can we influence choice? 32. 32Copyright 2009 Accenture All Rights Reserved. Perceived Relevance (User / Customer) Outcome / Result (Marketer) Subscription Virtual Good Pay per Play Bringing it together: Monetization Nirvana CPDO Low High High Monetization Nirvana Product / Service Success Accelerated Extinction Next big ideas 33. 33Copyright 2009 Accenture All Rights Reserved. Monetization Nirvana Next big ideas NAB Interest: Video 34. 34Copyright 2009 Accenture All Rights Reserved. Source: Accenture Consumer Broadcast Survey 2008 Level of satisfaction with current TV offerings, by age Satisfaction with TV offerings 35. 35Copyright 2009 Accenture All Rights Reserved. US online streaming video advertising revenues, by video type, 2008 & 2013 (% of total) Source: The Diffusion Group, Online TV and the Future of Online Video Advertising: An Excerpt from TDGs New Report, July 2008 2008 Long-form video 41.6% 69.4% User-generated video 3.7% 1.8% Short-clip video 54.8% 28.7% 2013 Online video advertising revenues 36. 36Copyright 2009 Accenture All Rights Reserved. Follow the money Shift to premium content 60% ads monetized on 348 million videos 9% ads monetized on 5.5 billion videos $240 million Est. 2009 Revenue Original Evolution The Latest $120 million Est. 2009 Revenue Source: Accenture Analysis, Credit Suisse, Newsweek sourcing Screen Digest. 37. 37Copyright 2009 Accenture All Rights Reserved. 82%of ad executives believe integrated offerings spanning all media types will be a key differentiator for ad buyers over the next 5 years PC TV Mobile Other Source: Accenture Media Content Survey 2008 Multi-screen delivery drives consumer engagement and monetization 38. 38Copyright 2009 Accenture All Rights Reserved. Multi-screen and integrated services will allow to leave advertising behind. Forget ads for a second, but imagine potential for book clubs (social graph & affinity) 39. 39Copyright 2009 Accenture All Rights Reserved. Super Bowl TV Commercials Have Legs Online Source: Google Super Bowl 2009: Screens Increasingly Converge 40. 40Copyright 2009 Accenture All Rights Reserved. Super Bowl 2009: Screens Increasingly Converge Source: Google 41. 41Copyright 2009 Accenture All Rights Reserved. 3 day contest in 2009 vs. 1 week contest in 2008 2.6MM+ Votes highest for any YouTube program over 3x the votes the 2008 program generated in one week 21MM+ Super Bowl Commercial Views over 2x the views the 2008 program generated in 3 days, and still more than 08 program generated in one week High Engagement 40,000+ favorites 12,000+ comments 44,000+ ratings Super Bowl 2009: Screens Increasingly Converge Source: Google 42. 42Copyright 2009 Accenture All Rights Reserved. HD viewing option expands to full width on the watch page Click: VideoSource: Google, Etrade ETRADE: Significant uptake in applications. 43. 43Copyright 2009 Accenture All Rights Reserved. Engage with the ecosystem Source: Screen captures from websites 44. 44Copyright 2009 Accenture All Rights Reserved. Click: Video Potential future ways of how to engage with brands: Euclid Media Source: www.euclidmedia.com 45. 45Copyright 2009 Accenture All Rights Reserved. So what needs to happen? 46. 46Copyright 2009 Accenture All Rights Reserved. Future: From innovation explosion to science based optimization Unit (e.g. Ads, Campaigns, etc.) Pricing Models (e.g. CPA, CPDO, CPE, etc.) Engagement Platform (Mobile, PC, TV, etc.) (facebook, twitter, etc.) Content Type (UGC, short-form, long-form, etc.) Quantitative continuous optimization of: -Experience -Monetization Today Tomorrows Challenge Tomorrows Solution 47. 47Copyright 2009 Accenture All Rights Reserved. For Marketer - Price the desired outcome. For User - Give up control. Encourage and enable experimentation. The end of the funnel could mean the end of the tunnel. 1 2 3 4 5 Takeaways Invest in analytics and continuous optimization. 48. 48Copyright 2009 Accenture All Rights Reserved. For more information, contact philipp.stauffer@accenture.com 49. 49Copyright 2009 Accenture All Rights Reserved. Accenture Consumer Content Study 2009 www.accenture.com/ broadcastsurvey Accenture Global Digital Advertising Study 2008 www.accenture.com/ 2008digitaladvertisingstudy Accenture Consumer Content Study 2008 www.accenture.com/ 2008contentstudy Accenture Future of Broadcasting 2008 www.accenture.com/ 2008digitaladvertisingstudy Available Research