Dtt iab 14sept_v01

IAB report on
online ad-spend
H1 2011
September 2011
interactiv
advertisin
bureau

IAB report on online ad-spend H1 2011 2
Introduction and
summary

This report provides us with a more detailed look at the growth drivers of our
industry, e.g. automated trading which is clearly getting up to speed.
Businesses who provide their data make this report possible. This report is a
benchmarking tool for the participants that will allow them to compare themselves
to the industry.
We hope you enjoy reading this report. We welcome feedback for further
improvement and hope to see even greater participation in the future.
It has been four months since the IAB and Deloitte published the online advertising
spend report for The Netherlands in this new format. We are happy to report that the
first edition received great feedback and that the current edition – which covers 2011
H1 – had even more respondents taking part.
Introduction
“Innovation in the digital advertising
industry can only take place if we
have all neccesary insights concerning
the market. This reports deliveres this
foundation.”
“Data is only as reliable as the
level of participation. A more than
representative sample of online
businesses support this study by sharing
their data and we are proud to see that
the participation has increased.”
Joris van Heukelom
Chairman IAB
Roel van Rijsewijk
Deloitte Online Business Innovation

Executive Summary
The Dutch online advertising market
was €507m for the first half of 2011,
a year on year uplift of 10%.
The automotive sector has replaced
financial services as the leader in online
advertising spend in H1 2011; travel
spend also increased significantly.
Full year online revenues for display ads
are expected to be around €163m - €170m;
affiliate marketing networks will reach
€114m - €117m.
Respondents indicated that 54% of
their online revenues are generated via
direct sales, media agency account
for 35%.
43% of companies surveyed offer
automated trading which accounts
for 11% of the display advertising
revenues.
“The uplift seen in the online
advertising market shows the strong
fundamentals of the Dutch market.
However, the macro-economic
environment may impact the second
half of the year.”
“Compared to a sluggish first half of
2010, the online advertising market
has picked up momentum with several
leading players showing double digit
growth in online revenues.”
Maarten Kuil
Deloitte Consulting | Strategy
Jorrik van Wonderen
IAB Nederland

H1 2011 Results

Online advertising market
The Dutch online advertising market was €507m for the first six months of 2011, a
year on year uplift of 10%.
* Others includes online video, branded content, email, mobile and tablet, and in-game advertising
Source: Survey respondents, Deloitte analysis
+10%
221.3
86.1
57.2
70.0
22.3
5.7
Search
Classifieds
Affiliate marketing
Display
Others*
Unclassified
6.7
29.5
82.9
54.9
78.4
255.0
2010 H1
€462.6m
2011 H1
€507.4m
Maarten Kuil
“The advertising market has shown
strong growth, especially in the display
segment. However, the weak macro-
economic environment has impacted
the classifieds segment which has
shown weakness”

Details others categories
The market for online video posted only modest growth in the first half of 2011,
mobile ads grew fast but remained small.
Segmentation performed based on reported survey data
Note: Online video excludes revenues from international Google properties including YouTube
Branded content E-mail Mobile / TabletOnline video
16.6
13.1
10.2
6.2
1.3
1.8
1.2
0.2
+484%-29%
+64%
+27%
2011 H
1
2011
H1
2
010 H1
2010 H1
In-game
0.2
1.0
-80%
2011 H1
20
10 H1 2011
H1
20
10 H1
2011
H1
201
0 H1
“While consumers are ready for mobile
advertising, major advertisers are yet to
get their game together.”
“The trend of online audiovisual
communication combined with TV
will grow even further into audiovisual
planning instead of standalone TV or
online planning. The type of screen
does not matter anymore - it is the
message that counts.”
Thijs Kempers
Wegener
Jacqueline Heemskerk
Fox Channels Benelux
Break up of other revenues (€m)*

Shares of advertising and visitors
Within traditional publishers, there remains a significant variety in the ratio of the
share of wallet and share of visitors.
Advertising share / visitors share
Low
Average
High
0
2
4
6
8
10
12
Number of publishers
SoW/SoR
111111111212111
0.0 0.2 0.3 0.5 0.6 0.7 0.8 0.9 1.1 1.3
1.6 1.7
2.9
5.6
10.7
1.0
Note: Excluding classifieds, search and affiliate marketing networks
Source: Survey respondents; Deloitte analysis
Comments
• The power ratio of the participating
publishers shows a great diversity.
The power ratio is calculated
through dividing the Share of Wallet
by the Share of Reach.
• Publishers with a specific target
audience received a high advertising
share relative to its visitors share.

Top five industries
The automotive sector has replaced financial services as the leader in online advertising
spend; travel spend also showed a sharp increase.
Top five industries by revenue share
2010 H1 2011 H1
Automotive
Financial
services
Consumer
goods Telecom
Automotive
Hardware &
electronics
11% 10% 10% 9% 6%
Travel
12% 10% 8% 7% 7%
Financial
services
Consumer
goods
Telecom
Automotive
Note: Excluding classifieds and search

Revenue per channel
2011 H1
Direct sales
Media agency
Ad exchanges
Ad networks
and saleshouse
35%54% 6% 5%
Media agency
Direct sales
Ad exchanges
50% 46% 38% 42% 8% 7% 4% 5%
Ad networks
and saleshouse
Like for like comparisonComments
• Direct revenue has increased
significantly compared to the
previous survey due to participation
of additional companies.
• On a like for like basis only 4% of
revenue has shifted away from
media agencies. Direct channels
have gained 4%.
Respondents reported that 54% of their online revenues are generated directly; media
agencies account for 35%.
Emile van den Berg
IAB Nederland
“Direct sales are mainly driven by
companies entering into deals to sell
branded content with advertisers.”
Revenue per sales channel

CPM is the preferred payment model for publishers while affiliate marketing networks
book most of their revenue with the performance based model.
Revenue per payment model
Revenue per payment model
2011 H1
Natascha Schonhuth
Adfab
“Due to our utilization of premium
and leading websites the major part of
our calculation model is represented
by CPM, despite the growing demand
for leads or sales based calculation
models.”
48.2%
34.0%
14.8%
2.9%
53.0%
27.4%
16.3%
3.2% 0.1%
99.9%
CPM
Performance based
Fixed Fee
Other
Total revenue per
payment model
Publisher revenue per
payment model
Afﬁliate revenue per
payment model

11%
89%
43%
57% 68%
32%
Automated trading
Revenue from
automated trading
# Companies offering
automated trading
Companies offering
automated trading
(weighted)*
43% of companies surveyed offer automated trading which is responsible for 11% of
the revenues from display advertising.
Automated trading revenues
Automated trading revenues
2011 H1
* Weighed – Total revenue from companies offering automated trading (43% of all companies)
accounts for 68% of the total online advertising revenue
Janneke Niessen
Improve Digital
“Automated trading has been growing
significantly in the last year and we
expect strong growth in the next years
as well. Real-time bidding (RTB) has
been shown to be an important driver
for this growth in automated trading.”

Direct revenues
34%
Ad network / saleshouse
16%
Automated trading agencies
5%
Media agency
29%
Ad exchange
12%
Agency trading desks
4%
Surveyed companies indicate their revenue sources for online advertisements through
real-time bidding are quite evenly distributed.
Automated trading channels
Origin of display ads through automated trading
2011 H1
Source: Survey respondents (9), Deloitte analysis
Tim Geenen
Banner Connect
“We are increasing the efficiency and
scale in online advertising with more
technology and automation. Real-time
bidding, automated marketplaces and
audience buying/selling are the key
drivers of this change and we believe
that this will create a solid ground for
double digit growth numbers the next
few years.”

Outlook

Revenue growth expectations
We foresee a market growth of 20% for 2012 based on the weighted average growth
expectations of survey respondents.
Expectations of revenue growth
200%150%100%50%40%30%15%10%
1 1 2 1 7 2 3 2 1 1 1 13
7%5%4%0% 20%
number of
respondents
(total of 26)
Weighted average growth expectation*
Low
Average
High
2012 expectations
*Average growth expectation calculated by weighting responses with company revenue
Maarten Kuil
“Most companies have strong growth
expectations with 21 respondents
expecting 10% or more growth;
naturally smaller companies are
expecting to grow faster than larger
ones.”

CPS CPC CPL Fixed Fee CPM
0
22011
2012 11
2
4
5
13
9
7Which payment model will grow
fastest in 2012?
(by number of respondents)
Which payment model will grow
fastest in 2011?
Payment model growth expectations
Most respondents expect CPM and Fixed fee to remain the preferred payment models
in 2012 with CPM remaining dominant.
Natascha Schonhuth
Adfab
“Given the extended demand for
content integration, our calculation
model for fixed fee agreements is rising
exponentially and this tendency will
probably continue to do so.”
Thijs Kempers
Wegener
“CPM is the most transparent and
honest payment model for advertiser
and publisher. It is not fair to award a
consumer action to one single banner
view or click.”

4
6
3
2
2
2
2
2
Hardware &
electronics
Online
retail
Telecom
Travel
Automotive
Retail
FInancial
services
Consumer
goods
6
4
4
2
1
1
1
Hardware &
electronics
Online
retail
Travel
Automotive
FInancial
services
Consumer
goods
Retail
Which industry do you think will grow fastest in 2012 (respondents)? Which industry do you think will grow fastest in 2011?Comments
• Financial services and consumer
goods remain the industries
expected by most respondents to
increase their advertising budget.
• Traditional and online retail are
expected to remain important with
traditional retail expected to grow
faster than online retail.
• Hardware & electronics and
automotive also remain growth
industries with a resurgence of
expectations for the telecom sector.
Respondents think that online revenues will grow fastest in the consumer goods and
financial services sectors.
Sector growth expectations

Revenue forecast
FY online revenues for display ads are expected to be around €163m - €170m;
affiliate marketing networks will reach €114m - €117m.
-2%+22%
2010
€139m
2011
€170m
2010
€119m
2011
€117m
High Range
114
163
3
7
Low Range
High Range
Low Range
Display revenue forecast
FY 2011 (€m)
Affiliate marketing forecast
FY 2011 (€m)

Appendix

• The report includes included data from 32 companies including the largest
publishers in The Netherlands e.g. TMG, Sanoma Media, Wegener Media and
Microsoft.
• Together, these companies represent nearly 334 websites and comprise over
77% of total reach (based on STIR). Corrections for other sites not reported by
STIR are based on Comscore data.
• Figures are based on data as reported by survery respondents and has not been
independently verified.
• Wherever needed we have used tools such as statistical instead of regression
analysis to make estimations regarding issues like total advertising spend.
• Based on the information provided by survey participants, figures have been
adjusted for double counting.
Search and classifieds estimates
• Due to limited availability of company data we estimated the market size for
search and classifieds based on market data.
• Together with the taskforce search from the IAB we defined the search market
and estimated the market size.
• Attempts were made to verify data with market leader Google but due to
company regulations they could not comment on our findings.
• The classified market is based on publicly available market estimates. Due to
limited data input current classified market size could not be verified.
Methodology

• Display advertising revenue: Generated by advertising on publishers’ sites,
where size and location on the site are agreed upon. For example banners,
skyscrapers, medium rectangles, leaderboards and rich media.
• Online classifieds & directories: Revenue generated by publishing a classified
add on a website.
• Branded content (content integration): A fusion of content and advertising
which may or may not include ad elements such as display advertising, brand
logos, advertorial or pre-roll video.
• E-mail marketing: Revenue generated by publishing the ad within the content
of e-mail newsletters. Both display adds and sponsored content.
• Online video advertising: Revenue generated by advertising in, on or around
online video. Standard formats are pre-roll, mid-roll and post-roll. The ad can be
published during, before or after the online video.
• In-game advertising: Revenue generated by advertising, where the ad is
published within a computer game (bought by a retailer), or within an online
video game (via a console, pc, mobile, laptop with internet connection).
• Dedicated mobile: Revenue generated by advertising unique to mobile and
tablets. For example apps and mobile websites.
Search and classifieds estimates
• CPM: Cost per Mille = Payment model where the advertiser pays per thousand
impressions.
• CPL: Cost per Lead = Payment model that is based on the number of leads
generated. A lead is an online conversion where the consumer shares its contact
details and indicates a specific interest.
• CPC: Cost per Click = Payment model based on the number of clicks on an
advertisement.
• CPS: Cost per Sale = Payment model based on the number of sales generated.
• Fixed Fee: Payment model based on a fixed fee.
Definitions

Name of company
1 Adfab
2 Adfactor
3 Adlantic Online Advertising B.V.
4 Affilinet Nederland B.V.
5 Bannerconnect
6 Elsevier B.V.
7 FD Mediagroep
8 Fox Networks
9 Funda Real Estate B.V.
10 HDC Media
11 Hi-media Nederland B.V.
12 IMNetworks B.V.
13 Kluwer
14 Microsoft
15 MTV Networks
16 OMG/Netdirect
Name of company
17 Persgroep Advertising
18 RTL Nederland Interactief
19 Sanoma Media
20 SBS
21 Smartclip
22 Ster
23 Telegraaf Media Groep
24 Testnet Online Advertising
25 The Mbuyu Community B.V.
26 TTG Sulake
27 VNUMedia
28 WebAds Interactive Advertising
29 Webregio Media
30 Wegener Media B.V.
31 Zoom.in
List of survey participants
Note: several anonymous participants have delivered partial data for this report

Jorrik van Wonderen
IAB Research Manager
Tel: +31 (0)20 531 51 19
Email: research@iab.nl
Jorrik is responsible for Dutch IAB research including the IAB / Deloitte Ad Spend
Study, all IAB commissioned research and assisting IAB members with their research
projects. He is also responsible for shaping the IAB knowledge base so that it meets
members’ needs moving forward.
Maarten Kuil
Tel: +31 (0)6 12 345 133
Email: mkuil@deloitte.nl
Maarten is responsible for the National Media accounts within Deloitte Consulting.
He has over 14 years experience in strategic, organizational and multi-disciplinary
projects. He is specialized in strategy development, strategic due diligence/M&A,
business case development and performance improvement.
Roel van Rijsewijk
Deloitte Online Business Innovation
Tel: +31 (0)6 52 615 087
Email: rvanrijsewijk@deloitte.nl
Roel is a Director with the Risk Services practice from Deloitte with more than 10
years of experience in risk consulting for companies in the Technology, Media &
Telecommunications (TMT) industry. Roel leads one of Deloitte’s main innovation
projects on ethics and trust in a digital world and is co-founder of Deloitte’s Online
Business Innovation group.
For questions concerning this research feel free to contact:
Contact details

Disclaimer:
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity.
Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms.
Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150
countries, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte’s approximately 182,000
professionals are committed to becoming the standard of excellence.
This publication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the “Deloitte Network”) is, by means of this
publication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No
entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this publication.
© 2011 Deloitte The Netherlands

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