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  • MAKING IT IN MYANMAR

    WITH CONSUMER FORESIGHT, MOBILE INSIGHTS

    4 December 2014

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    Thurein Nyein General Manager Nielsen MMRD [email protected]

    Sagar Phadke Executive Director Smartphone Analytics Solution Nielsen Southeast Asia, North Asia and Pacific [email protected]

    YOUR PRESENTERS TODAY

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    Pioneer in research services in Myanmar

    Global brand of information and insights into what consumers watch and buy

    In-depth understanding

    of the Myanmar marketplace and consumer behaviour

    90 YEARS OF INNOVATION

    20 YEARS IN THE MARKET

    UNLIMITED OPPORTUNITIES

    TIMELY JOINT VENTURE TO HELP YOU WIN NEW MARKETS, NEW CONSUMERS

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    DISCOVER the growth and opportunities in

    Myanmar.

    GAIN key insights into how to

    connect and communicate with target consumers.

    EXPLORE consumer attitudes that drive decisions on what

    they watch and buy.

    OUR AGENDA

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    WHERE ARE THE OPPORTUNITIES?

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    Volume of Foreign Trade FDI Trend in Myanmar

    Source: Ministry of Commerce; Directorate of Investment and Company Administration (DICA)

    Since 2009, import volume up 230% & FDI inflows up 30%

    MYANMAR ON THE RISE

    6,402 6,779 7,587

    8,861

    9,136

    9,056

    11,204

    3,353

    4,543 4,181

    6,413

    9,035

    9,372

    13,760

    -

    2,000

    4,000

    6,000

    8,000

    10,000

    12,000

    14,000

    16,000EXPORT (US $ MILLION)

    IMPORT (US $ MILLION)

    34

    ,53

    5

    34

    ,74

    0

    35

    ,72

    5

    36

    ,05

    5

    40

    ,69

    9

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    ,11

    9

    46

    ,22

    6

    434 442 447 454 467

    561

    684

    0

    100

    200

    300

    400

    500

    600

    700

    800

    -

    10,000

    20,000

    30,000

    40,000

    50,000

    VAULE (US $ MILLION)

    NO. OF FDIS

    Following the 2010 general election, a nominally civilian government takes the lead after 5 decades of military rule and begins implementing political and economic reforms that are met with an easing of trade and other economic sanctions by the international community.

    Continued reforms and a new investment law make Myanmar an FDI magnet.

    TOP 3 IMPORTS 1. Diesel 2. Automobiles 3. Iron & Steel

    TOP 3 INVESTORS (by approved amount) 1. China 2. Hong Kong 3. Singapore WHERE IS IT GOING? Oil & Gas + Power

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    MARKET ENVIRONMENT 2010 2011 2012 2013 2014F 2015F

    Adspend(USDMillions) 57.0 77.7 118.2 151.7 210.8 294.6

    Digital n.a. n.a. n.a. n.a. n.a. n.a.

    TV/Radio 61% 58% 63% 64% 66% 67%

    Retailsales(USDMillions) 8,537 9,575 11,030 13,200 15,246 17,612

    MT 8.8% 9.5% 9.9% 10.0% 10.4% 10.8%

    TT 91.2% 90.5% 90.1% 90.0% 89.6% 89.2%

    MNCs 31.5% 32.6% 33.2% 35.0% 38.1% 39.7%

    Local 68.5% 67.4% 66.8% 65.0% 61.9% 60.3%

    GDP(MMKBillion) 39,847 44,279 45,779 49,853 53,742 57,933

    Inflation 8.2% 4.2% 5.8% 5.5% 6.6% 6.9%

    CCI n.a. n.a. n.a. n.a. n.a. n.a.

    Ad budgets continue to grow and TV dominates ad spends

    Modern Trade expected to continue growing Key to long term relevance of Retail Index measurement

    Steady growth in MNC product sales

    Source: Local Government statistics / ADB/ MRA/ Nielsen MMRD

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    Heres how..

    DOING BUSINESS IN MYANMAR

    MARKET ENTRY: 3 WAYS

    REGISTRATION/PERMIT

    NO INCENTIVE

    START

    PERMIT

    INCENTIVES

    START

    PERMIT

    INCENTIVES

    START

    MYANMAR INVESTMENT COMMISSION

    (MIC)

    SPECIAL ECONOMIC ZONE MANAGEMENT

    COMMITTEE (SEZ MC)

    DIRECTORATE OF INVESTMENT

    AND COMPANY ADMINISTRATION

    (DICA)

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    Two-third of the population live in one-third of land

    area

    12.8%

    18.6%

    68.6%

    Metropolitan Urban Rural

    Stratum Population

    Metro 6.60

    Urban 9.55

    Rural 35.27

    Source: Nielsen MMRD Consumer Media View (CMV) 2014

    Hilly

    Dry

    Plain

    Delta

    Coastal

    Coastal

    12.8%

    24.9%

    22.0%

    14.5%

    14.5%

    11.3%

    Metropolitan Hilly Dry

    Plain Delta Coastal

    Region Population

    Metro 6.60

    Hilly 12.79

    Dry 11.31

    Plain 7.43

    Delta 7.45

    Coastal 5.83

    POPULATION IS URBANISING But Rural households still outnumber Metro 6 to 1

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    STATE &AND REGION POPULATION (Million)

    YANGON 7.36

    AYEYAWADY 6.18

    MANDALAY 6.15

    SHAN 5.82

    SHAN (N) 2.37

    SHAN (S) 2.62

    SHAN(E) 0.83

    SAGAING 5.32

    BAGO 4.86

    BAGO (E) 2.89

    BAGO(W) 1.97

    MAGWAY 3.91

    RAKHINE 3.19

    KACHIN 1.69

    KAYIN 1.57

    TANINTHARYI 1.41

    NAY PYI TAW 1.16

    CHIN 0.48

    KAYAH 0.29

    Grand Total 51.42

    MYANMAR POPULATION By state and region

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    Source: Nielsen MMRD Consumer Media View (CMV) 2014

    A YOUNG POPULATION POISED FOR GROWTH

    OLDER DEPENDENTS (6065+)

    OLDER INDEPENDENTS WITHOUT DEPENDENTS (5059)

    YOUNG INDEPENDENTS WITH DEPENDENTS (3049)

    INDEPENDENTS WITHOUT DEPENDENTS (2029)

    YOUNG DEPENDENTS (019) 38%

    17%

    28%

    9%

    8%

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    Sources: MMRD Consumer & Media Index 2008, 2010 2012 & 2013; Nielsen MMRD Consumer Media View (CMV) 2014

    Consumers are earning 90% more, spending 60% more than they were 6 years ago

    NEW PURCHASING POWER AND RISING DISPOSABLE INCOMES

    0

    50,000

    100,000

    150,000

    200,000

    250,000

    300,000

    2008 2010 2012 2014

    Avg HH Income Avg HH Expenditure

    Average Monthly Household Income & Expenditure (2008-2014)

    WHERE IS THE MONEY

    GOING?

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    WHO IS THE CONSUMER IN MYANMAR?

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    Base: All respondents n=1400

    Source: Nielsen EMI Survey 2014

    FMCG ACCOUNT FOR NEARLY HALF OF MONTHLY HOUSEHOLD EXPENDITURE

    65,000

    15,000 12,000

    Food & Grocery Household Products Personal CareProducts

    AVG SPEND PER MONTH BY CATEGORY (MMK)

    Food & grocery

    33%

    Health Care 9%

    New Clothes 8%

    Household Products

    8%

    Mobile phone 8%

    Education 7%

    Personal Care Products

    6%

    Utility bills 6%

    Transportation 6% Eating out

    3%

    Entertainment 3%

    House Rent 2% Loan

    installments 1%

    WHAT MYANMAR CONSUMERS SPEND ON

    Average FMCG spend per month ~ 90, 000 MMK

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    Base: All respondents n=1400

    Source: Nielsen EMI Survey 2014

    MOBILE NEW CLOTHES HEALTHCARE

    EMERGING TRENDS BEYOND FMCG

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    Yet much of the market for durables still to be realized

    AIR CONDITIONERS

    2014: 4% 2013: 4%

    WASHING MACHINES

    2014: 4% 2013: 4%

    HOUSEHOLD MOBILE PENETRATION INCREASED BY TWO-THIRDS IN 2014

    Base: 11.4M Households (2014); 11.2M Household (2013) Source: Nielsen MMRD Consumer & Media Index 2013 & 2014

    MOBILE PHONES

    2014: 44% 2013: 25%

    TELEVISIONS

    2014: 60% 2013: 56%

    MOTORCYCLES

    2014: 49% 2013: 43%

    REFRIGERATORS

    2014: 17% 2013: 14%

    +4% +19%

    +3% +6%

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    1,585 3,621 1,742

    32,504

    127,568

    0

    20,000

    40,000

    60,000

    80,000

    100,000

    120,000

    140,000

    2008-20092009-20102010-20112011-20122012-2013

    NO. OF CARS (MYANMAR CUSTOMS DATA)

    3% of Myanmar consumers are car owners

    69% drive Toyota Honda

    Mitsubishi Suzuki Mazda Nissan Others

    Source: Nielsen MMRD Consumer Media View (CMV) 2014 & Myanmar Customs data

    2010: Easier to get foreign cars into Myanmar. 2013: Consumers can buy new foreign cars.

    Caveat: Not new cars

    CAR OWNERSHIP IS SKYROCKETING

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    Base: 10+ Population & Bank Users n=4570

    Source: Nielsen MMRD Consumer Media View (CMV) 2014

    1 in 10 use banking services

    48% MONEY TRANSFERS

    CONVENIENCE is key

    33% Savings accounts 5% Credit accounts

    4% ATM/MPU/Debit cards

    Due to the lack of familiarity with banking services,

    A result of longstanding lack of infrastructure, access and awareness

    MAJORITY OF MYANMAR POPULATION UNBANKED

    CONVENIENCE OF SERVICE is the most influential factor for consumers selecting a banking service or financial product

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    MEET THE MYANMAR METRO CONSUMER

    Base: All respondents (n=1400) Source: Nielsen EMI Survey 2014

    Percentage of male and female respondents that agree with the given statements:

    TECH ASPIRANTS

    60% of men keep up with developments in technology

    39% of men think it is important to be attractive to the opposite sex

    GROOMING CONSCIOUS ON-THE-BALL BUDGETERS

    54% of women are good money managers

    78% of women enjoy the fun of shopping

    RECREATIONAL SHOPPERS

    (Female: 45%)

    (Female: 24%)

    (Male: 32%)

    (Male: 33%)

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    TOTAL

    STRATUM GENDER Metro Urban Rural M F

    1,400 500 600 300 644 756

    Able to spend freely 23 18 29 19 24 22 Live comfortably and buy some things just because I wanted to

    35 43 34 24 35 35

    Only enough money for shelter, food & essentials

    42 39 37 57 42 42

    NEW CLOTHES

    TECH PRODUCTS HOLIDAYS

    Base: Respondents who report some degree of luxury spending/disposable income n=813; All figures in % Source: EMI Survey 2014; Q3A When you have spare cash on hand, what do you spend it on (Top 3)?

    RURAL & URBAN CONSUMERS READY TO SPEND 23% say they have room for luxury

    TOP 3 ITEMS FOR SPARE CASH: (Across the board (age, gender, SEC, urbanisation)

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    Source: Emerging Market Insights Consumer Survey,2011

    I really enjoy doing the household grocery shopping (82%)

    I usually

    plan what I want to buy before I shop for groceries (77%)

    I always prefer to shop in a

    well-organised store (73%) and near my home (62%)

    I care about quality and am willing to pay more for quality products (59%)

    I like to

    take my time and browse all parts of the store or market I am shopping in (55%)

    Although I plan I usually

    end up buying additional grocery items (56%)

    CONVENIENCE DRIVEN LEISURE MINDED

    QUALITY CONSCIOUS

    PLANNERS, BUT SUSCEPTIBLE TO IMPULSE

    I do not buy brand imitation products to save money (64%)

    Household shopper respondents: n=633 Source: Nielsen EMI Survey 2014

    WHO IS THE MYANMAR SHOPPER FOR HOUSEHOLD PRODUCTS? Percentage of Household Shoppers that agree with the given statements

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    25%

    17%

    11% 14% 12%

    1% 0.1% 0.1%

    23%

    11% 9%

    25%

    10%

    2% 1% 1%

    17%

    28% 27%

    7% 5%

    1% 1% 0.4%

    Affordability Always buy thesame brand

    I've tried itbefore

    Recommendedby friends and

    family

    It is easilyavailable

    Recommendedby trade/shopkeeper/sales

    promoter

    It is a newbrand/product

    to me

    It is offeringpromotions and

    deals

    FOOD/BEV/DAIRY

    HOUSEHOLD CARE PRODUCTS

    PERSONAL CARE PRODUCTS

    Base: Users of respective categories (n=1,400) Source: Nielsen EMI Survey 2014

    Single most important factor when purchasing respective categories

    LEAST IMPORTANT

    Affordability, familiarity and availability reign supreme

    PROMOTIONS DONT WEIGH HEAVILY ON DECISION MAKING

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    Base: 44,530,467 Source: Nielsen MMRD Consumer Media View (CMV) 2014)

    Weighted by: Population

    % of Total Myanmar Population Media Exposure

    In Past Month

    VIDEO 62%

    RADIO 43%

    TV 51%

    OOH 40%

    NEWSPAPERS 13%

    MAGAZINES 6%

    10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

    JOURNAL 26%

    CINEMA 2%

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    WHATS YOUR MOBILE STRATEGY?

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    Source: Nielsen Smartphone Insights 2013, 2014

    62% 90% 52% 49% 34% 23%

    38% 10% 48% 51% 85% 77%

    Myanmar Malaysia Vietnam Thailand Philippines Indonesia

    Smartphone Non-Smartphone

    42% 100% 97% 88% 86% 78%

    58% 3% 12% 14% 22%

    Myanmar Malaysia Thailand Indonesia Vietnam Philippines

    Mobile Phone Ownership Non Owner

    MOBILE PHONE OWNERSHIP SMARTPHONE OWNERSHIP

    MOBILE PENETRATION REACHING CRITICAL MASS IN MYANMAR Smartphone ownership among mobile users in line with Southeast Asia

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    YOUNGER CONSUMERS ARE DRIVING ADOPTION IN MYANMAR

    Source: Nielsen Smartphone Insights 2013, 2014

    Myanmar Malaysia Vietnam Thailand Philippines Indonesia

    16-24yo

    62% 90% 52% 49% 34% 23%

    ADOPTION DRIVEN BY

    16-34yo 25-34yo 16-34yo 16-24yo 16-34yo

    SMARTPHONE PENETRATION AMONG MOBILE USERS

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    10 UNCOMMON INSIGHTS

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    WOM IMPACTS MOBILE DEVICE SELECTION Critical for brand marketers to invest in building emotional connection with consumers

    Source: Nielsen Smartphone Insights 2013, 2014

    1

    MYANMAR

    1FRIENDS/COLLEAGUES/ RELATIVES 2STORE

    MALAYSIA

    1 FRIENDS/ COLLEAGUES/

    RELATIVES 2 REVIEW AND BLOG

    ONLINE

    THAILAND

    1 FRIENDS/COLLEAGUES/ RELATIVES

    2 PHONE SALESPERSON

    INDONESIA

    1 FRIENDS/COLLEAGUES/

    RELATIVES 2 ADVERTISEMENTS /

    MAGAZINES /PAPERS PHILIPPINES

    1 FRIENDS/COLLEAGUES/

    RELATIVES 2 STORE

    VIETNAM

    1 FRIENDS/COLLEAGUES/

    RELATIVES 2 STORE

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    2

    Source: Nielsen Smartphone Insights 2013, 2014

    MYANMAR

    VALUE FOR MONEY

    INDONESIA

    OPERATING SYSTEM

    MALAYSIA

    DESIGN/STYLE

    PHILIPPINES

    Wi-Fi CAPABILITY

    THAILAND

    EASE OF USE

    VIETNAM

    DESIGN/STYLE

    MYANMAR CONSUMERS MORE VALUE CONSCIOUS Top device selection criteria

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    EVERYONE WANTS TO OWN THE LATEST Myanmar consumers share the same desire as their counterparts in Southeast Asia

    Source: Nielsen Smartphone Insights 2013, 2014

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    MYANMAR

    TO OWN THE LATEST PHONE

    INDONESIA

    TO OWN THE LATEST PHONE

    THAILAND

    TO OWN THE LATEST PHONE PHILIPPINES

    WANT TO TRY DIFFERENT OS

    VIETNAM

    TO OWN THE LATEST PHONE

    MALAYSIA

    TO OWN THE LATEST PHONE

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    MYANMAR

    PHILIPPINES

    MALAYSIA

    INDONESIA

    VIETNAM

    THAILAND

    20%

    40%

    20%

    15%

    15%

    10%

    1 IN 5 CONSUMERS RECEIVE MOBILE PHONES AS GIFTS Opportunity to promote mobile handset for special occasions targeting young, senior and female consumers

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    5

    Source: Nielsen Smartphone Insights 2013, 2014

    MY

    AN

    MA

    R

    81%

    24%

    24%

    IND

    ON

    ESIA

    MA

    LAY

    SIA

    73%

    81%

    94%

    PH

    ILIP

    PIN

    ES

    70%

    64%

    28%

    THA

    ILA

    ND

    VIE

    TNA

    M

    99%

    79%

    81%

    61%

    52%

    33%

    91%

    69%

    49%

    CHAT APPS SOCIAL NETWORK SHORT MESSAGING SERVICE

    INCIDENCE IN LAST 30 DAYS

    SMS IS POPULAR, BUT CHAT AND SOCIAL NETWORKING CATCHING UP

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    ANDROID RULES

    6

    Source: Nielsen Smartphone Insights 2013, 2014

    Android Penetration

    MYANMAR

    ANDROID 95%

    MALAYSIA 69%

    PHILIPPINES 80%

    THAILAND 44%

    VIETNAM 47%

    MYANMAR

    ANDROID 95%

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    CONSUMERS ARE DATA HUNGRY

    7

    Source: Nielsen Smartphone Insights 2013, 2014

    Huge opportunity to drive data in and out of home

    8% 17%

    51%

    76%

    55% 64%

    20% 28%

    34%

    77%

    40%

    58%

    92% 83%

    49%

    24%

    45% 36%

    80% 72%

    66%

    23%

    60%

    42%

    AT HOME OUT OF HOME

    Wi-Fi Cellular Data Wi-Fi Cellular Data

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    26% 32%

    12% 16% 16%

    36% 38%

    57%

    4% 12%

    7% 7%

    VIETNAM THAILAND PHILIPPINES MALAYSIA INDONESIA MYANMAR

    66%

    9% 12% 10% 12%

    38% 34%

    39%

    6%

    19%

    8%

    29%

    Source: Nielsen Smartphone Insights 2013, 2014

    VIDEO/MOBILE TV

    FM RADIO ONLINE MUSIC STREAMING

    PICTURES DOWNLOADS

    8 MULTIMEDIA ACTIVITIES ARE RESTRICTED TO FM RADIO Increasing access to data and content likely to change the habits

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    9

    1. YOUTUBE 2. GOOGLE 3. FACEBOOK 4. TWITTER 5. THAITV3

    1. GOOGLE 2. YOUTUBE 3. 24H.COM.VN 4. VNEXPRESS 5. TUOITRE

    1. FACEBOOK 2. GOOGLE 3. TWITTER 4. YAHOO 5. YOUTUBE

    1. FACEBOOK 2. YOUTUBE 3. GOOGLE 4. GOOGLE PLAY 5. YAHOO

    1. GOOGLE 2. FACEBOOK 3. YOUTUBE 4. YAHOO 5. MUDAH

    1. FACEBOOK 2. THITHTOOLWIN 3. GOOGLE 4. MYANMARNEWS 5. G-TALK

    MYANMAR INDONESIA

    THAILAND PHILIPPINES VIETNAM

    MALAYSIA

    FACEBOOK DOMINATES BUT CONSUMERS ARE NEWS HUNGRY

    TOP 5 WEBSITES

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    MOBILE ADVERTISING IS IN NASCENT STAGE Once received, consumers are receptive just like in other Southeast Asia countries

    Source: Nielsen Smartphone Insights 2012/2013

    Click frequency includes sometimes and always click

    19%

    45%

    81%

    44%

    47%

    89%

    Myanmar

    Indonesia

    Malaysia

    Philippines

    Thailand

    Vietnam

    CLICKED RECEIVED

    56%

    56%

    84%

    48%

    53%

    81%

    Myanmar

    Indonesia

    Malaysia

    Philippines

    Thailand

    Vietnam

    10

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    I am ok with advertising if it means that I can access content for free

    I am more likely to click on an ad that does not take me outside of the application to another website

    75%

    40%

    57%

    67%

    37%

    36%

    Myanmar

    Indonesia

    Malaysia

    Philippines

    Thailand

    Vietnam

    53%

    26%

    51%

    51%

    31%

    29%

    Myanmar

    Indonesia

    Malaysia

    Philippines

    Thailand

    Vietnam

    10

    FREE CONTENT IS KEY TO MOBILE ADVERTISING

  • WINNING STRATEGIES

    BROADEN THE MARKET INTELLIGENCE

    UNDERSTAND CONSUMER ACTIVITIES

    ON MOBILE

    KNOW IT. EVALUATE PLATFORMS TO

    INVEST IN GAMES, MUSIC, VIDEO,

    CHAT?

    INVEST IN IT.

    CONSIDER VARIOUS SCENARIOS AND OUTCOMES.

    BUILD FLEXIBILITY AND ADAPTABILITY.

    BE READY TO CHANGE IT.

    CONTINGENCY FOR TALENT ADOPT BEST PRACTICE.

    BUILD CAPABILITY THROUGH RELATIONSHIPS.

    PLAN FOR IT.

    39