The  Video  Ad  Exchange  Ecosystem  

Terence  Kawaja  

What  is  the  world’s  2nd  largest  search  engine?  

     1.      

       2.      _______________  

188  million  U.S.  internet  users  watched  38  billion  online  videos  

…in  August  ‘12  

>  350  Million  Views  

©  LUMA  Partners  LLC  2012  Denotes acquired company

VIDEO  LUMAscape  

©  LUMA  Partners  LLC  2012  

Performance

Video / Rich Media

Targeted Networks / AMPs

Horizontal

Vertical / Custom

Mobile

Exchanges DSPs

Publisher Tools

Data Suppliers

Ad Servers

DMPs and Data Aggregators

Measurement and Analytics

Creative Optimization

Agency Trading Desks

Denotes acquired company

Ad Networks

Media Planning and Attribution

Verification / Privacy

Ad Servers

Retargeting

Media Mgmt Systems and Operations

Sharing Data / Social Tools

SSPs

DISPLAY  LUMAscape  

MARKETER

PUBLISHER

CONSUMER

i  

Tag Mgmt

Agencies

©  LUMA  Partners  LLC  2012  

The  Future  is  Happening  in  REAL  TIME  (bidding)  

Source:  IDC  

$352  

$1,067  

$1,975  

$2,921  

$3,948  

$5,076  

$0  

$1,000  

$2,000  

$3,000  

$4,000  

$5,000  

$6,000  

0%  

10%  

20%  

30%  

40%  

50%  

60%  

70%  

2010   2011   2012   2013   2014   2015  

RTB  Spend  ($M)   RTB  %  of  Indirect   RTB  %  of  Display  

US  Real  Time  Bidding  Growth  

$(millions)  

©  LUMA  Partners  LLC  2012  

Video  RTB  Growth  

Source:  econsultancy  

$(millions)  

US  Video  Real  Time  Bidding    

15%  

22%  

$0  

$500  

$1,000  

$1,500  

$2,000  

$2,500  

$3,000  

$3,500  

2009   2010   2011   2012   2013  

RTB   Non-­‐RTB  

©  LUMA  Partners  LLC  2012  

$0  

$5  

$10  

$15  

$20  

$25  

$30  

2011   2012   2013   2014   2015   2016  

Sponsorships  

Rich  Media  

Video  

Banners  

Video  vs.  Display  

Source:  eMarketer  

Adver\sing  Spend  by  Display  Format  

61%  45%  

32%  

16%  

$(billions)  

©  LUMA  Partners  LLC  2012  

The  Rise  of  Programma\c  Premium  

Hand  Sold  Sponsorships  

Hand  Sold  Premium  Inventory  

Hand  Sold  Targeted  Inventory  

Targeted  Inventory  sold  via  Ad  Exchanges  

Remnant  “Wholesale”  Inventory  sold  to  Ad  Networks  

Tier  1  

Tier  1.5  

*Inspired  by  Eric  Picard  (www.springload.com)  

Tier  2  

Show  in  a  stacked  bar  chart  

©  LUMA  Partners  LLC  2012  

Global  Internet  Device  Sales  

Source:  Gartner,  IDC,  Strategy  AnalyDcs,  company  filings,  SAI,  ISI  esDmates  

©  LUMA  Partners  LLC  2012  

There  Remains  a  Huge  Untapped  Opportunity  

Adver_sing  Spend  by  Channel  

$65   $66  $68   $69  

$2.5   $3.1   $3.7   $4.5  

0%  

5%  

10%  

15%  

20%  

25%  

30%  

$0  

$10  

$20  

$30  

$40  

$50  

$60  

$70  

$80  

2012   2013   2014   2015  

Television   Online  Video   Growth  $(billions)  

Source:  eMarketer,  Forrester  

(Online  Video)  

Introducing  

HOT  OR  NOT  

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  Media  Formats    

DISPLAY VIDEO

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  Ad  Formats  

DISPLAY VIDEO

©  LUMA  Partners  LLC  2012  

Brand  

HOT  or  NOT:  Marketer  Objec\ve  

DISPLAY VIDEO

Direct  Response  

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  View-­‐ability  

?  ?  DISPLAY VIDEO

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  Revenue  

DISPLAY VIDEO

$4  -­‐  

$2  -­‐  

$0  

$6  -­‐  

$(Billions)  

$8  -­‐  

$10  -­‐  

$20  -­‐  

$22  -­‐  

$24  -­‐  

2011  

2011  

2016  

2016  

(Growth)  

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  Analog  Ad  Opportunity  

DISPLAY VIDEO

$12B  

$16B  

$72B  

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  CPM  Pricing  

DISPLAY VIDEO

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  Exchanges  

DISPLAY VIDEO

Exchanges Exchanges

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  800  LB  Gorilla  

DISPLAY VIDEO

©  LUMA  Partners  LLC  2012  

HOT  or  NOT:  CEOs    

DISPLAY VIDEO

©  LUMA  Partners  LLC  2012  Denotes acquired company

STRATEGIC  BUYER  LUMAscape  

Thank  You  

Investment Banking . Evolved. New  York      –      Palo  Alto  

lumapartners.com  

Thank  you    

@tkawaja