Capital Markets Day ProSiebenSat.1 Media AG. Ad Sales. Thomas Ebeling, October 5, Page 1

Transcription

1 Capital Markets Day ProSiebenSat.1 Media AG Ad Sales Thomas Ebeling, October 5, 2011 Page 1

2 Strong sustainable position in an attractive market with significant upside potential 1 ProSiebenSat.1 with strong sustainable position in attractive market 2 TV media mix winner as the most effective and indispensable media 3 We stick to our guidance in 2011 with usual low visibility in Q4 4 TV rests on solid fundamentals with significant upside potential Page 2

3 7.1M with strong and stable position in TV ad market Net Share of Advertising* (estimate) * P7S1 excl. N24, 9Live and Sixx; RTL Group excluding RTL II Source: Own market estimates Page 3

4 Strong 4 channels with complimentary market positioning Target group structure and audience shares 14-49, all day, in percent male share at 14+: 53.4%* 6.0% 11.6% share men old at 14+: 48.4%* 10.6% young 0.3% female Source: AGF/GfK Fernsehforschung / TV Scope / Audience Research [BS] Page 4

5 and higher, stable power ratio Power Ratio = Net Share of Advertising/Audience Share* * P7S1 excl. N24, 9Live and Sixx; RTL Group excluding RTL II Source: Own market estimates Page 5

6 RTL audience share gains mainly in low ad spend slots RTL audience share gain, viewers aged years, %pt; Share of ad spend, in percent Morning Noon/ afternoon Access/ Prime Night Total Morning Noon/ afternoon Access/ Prime Night Total * Morning: 3:00-12:00; Noon/Afternoon: 12: ; Access/Prime: 17:30-23:00; Night: 23:00-3:00 / vs , pp Source: AGF/GfK-Fernsehforschung, TV Scope / Nielsen Media Research, Page 6

7 and with unattractive target group segments Characteristics of RTL afternoon audience comparison of structure shares, in % High income** RTL scripted reality core audience Higher education others Brand consciousness * Morning: 3:00-12:00; Noon: 12:00-14:00; Afternoon: 14: ; Access/Prime: 17:30-23:00; Night: 23:00-3:00 **Income>2.000 EUR / Source: AGF/GfK Fernsehforschung, TV Scope / own calculations Page 7

8 Strong sustainable position in an attractive market with significant upside potential 1 ProSiebenSat.1 with strong sustainable position in attractive market 2 TV media mix winner as the most effective and indispensable media 3 We stick to our guidance in 2011 with usual low visibility in Q4 4 TV rests on solid fundamentals with significant upside potential Page 8

9 TV and Online are the media mix winner Development of net advertising share by media in Germany 1 in percent Page 9 Based on ZAW data; excluding direct mail and directories 2 Including display (banner and video), excluding Search and affiliate Source: ZAW; OVK; Screen Digest; McKinsey

10 TV winner of the last crisis TV share in Net Media Mix Percentage 100% TV increased media-mixshare in crisis by 1.3%pt +1.3% 25.0% 26.3% GDP declined by -3.4% Source: ZAW; OVK; McKinsey Page 10

11 TV usage in main target group further increasing Average daily usage in Germany: viewers years In minutes min min TV Print Online 27 min. Note: Excl. passive Online usage starting from 2008 (18% of total Online usage) Source: TimeBudget / SevenOne Media / forsa. / GfK ENIGMA / mindline, Basis: 2,021 interviewees. Note: Print including Magazines and Newspapers. Page 11

12 Even young viewers keep high TV-usage no cannibalization Average daily usage in Germany: viewers years In minutes min. 120min TV Print Online 21min. Note: Excl. passive Online usage starting from 2008 (18% of total Online usage) Source: TimeBudget / SevenOne Media / forsa. / GfK ENIGMA / mindline, Basis: 2,021 interviewees. Note: Print including Magazines and Newspapers. Page 12

13 TV is the most attractive medium 1 Highest and fastest reach 2 Strongest emotional impact 3 Cost efficient compared to other media types 4 Leading to highest ROI even indispensable for Internet companies 5 Delivers value for agencies Page 13

14 1. Unrivalled daily reach even kabel eins is above Bild The Power of TV ProSiebenSat.1 example Source: AGF/GfK-Fernsehforschung; TV Scope, Fernsehp.(D+EU), weighted by person, time shifted utilization, product related (r,v,z), , for Fact viewers: Exposure time: 00:01:00; ma 2009 Presse II Page 14

15 2. TV has strongest emotional impact Medium for strongest emotions % Other 15 Internet Radio 4 5 Print 4 72 TV Which medium is most emotional, is most likely to make you cry or laugh? Basis: n=1.000 persons 14+ Source: forsa. Page 15

16 3. TV is cost efficient compared to other media types Net CPM ranges, in Euro TV Newspapers Magazines Online Source: Solon estimate Page 16

17 4. TV advertising is working superbly with highest ROI Stronger brand image / power Brands with high TV presence twice as frequently in consumer s relevant set Higher probability of purchase Probability of purchase is 35% higher two days after TV spot TV stimulates online shopping 73% more consumers if TV and Internet combined Source: GfK-study Markenmotor TV / AC Nielsen / JupiterResearch Consumer Survey. Page 17

18 4. TV-ROI even higher than search-roi TV-ROI 25% above Internet Search ROI TV Internet Search ROI: Based on net CPM pricing. Page 18

19 4. TV is even indispensible for Internet companies e-commerce companies strongly increase TV spendings Growth of gross TV ad spendings 85% x 5 x 5 and spend 60% of budgets on TV Share of media spendings, YTD 2011 Print Other 4% 8% 16% 30% x 12 29% Internet 59% TV 2.5% 2010 YTD 2011 ecommerce TV market Source: Nielsen Media Research, Product group E-Commerce, YTD: Jan-Aug 2011 Page 19

20 4. TV ads immediately lead to Internet traffic Ad Investments and Internet Search Zalando T and Index 12,000 10,000 8,000 6,000 4,000 2,000 0 Dec 09 Mar 10 Jun 10 Sep Ad pressure TV Google Searches Almost linear correlation between TV ads and Internet Search Page 20 Based on gross advertising investments and queries (indexed to the maximum value = 100) Source: Nielsen Media Research, Google Insights for Search

21 5. TV delivers higher value to agencies Other Online Other Online Print Print TV TV Share of net spendings (estimate) Share of Agency profit (estimate) Based on ZAW data; excluding direct mail and directories 2 Including display (banner and video), excluding Search and affiliate Source: ZAW; OVK; Screen Digest; own estimates Page 21

22 TV ad market in Germany underproportional as % of GDP Ad intensity: TV Advertising as % of GDP, France Italy Spain UK Western USA Europe Page 22 Source: Zenith Optimedia Advertising Expenditure Forecasts July 2011

23 Strength of TV could lead to increasing share in media-mix Other Online % 6% % 10% Print 57% 51% - TV most effective media TV 26% 29% - TV underproportional in Germany 2011e 2015e Page 23 Based on ZAW data; excluding direct mail and directories 2 Including radio, cinema, outdoor 3 Including display (banner and video), excluding Search and affiliate Source: ZAW; OVK; Screen Digest; own estimates; outlook based on PWC Entertainment & Media Outlook and Zenith Advertising Expenditure Forecast

24 Strong sustainable position in an attractive market with significant upside potential 1 ProSiebenSat.1 with strong sustainable position in attractive market 2 TV media mix winner as the most effective and indispensable media 3 We stick to our guidance in 2011 with usual low visibility in Q4 4 TV rests on solid fundamentals with significant upside potential Page 24

25 Commitment growth 2011 driven by smaller customers Closed Commitments 2011 vs. 2010, % Top 50 Non Top 50 Total Page 25

26 Most industries positive Nielsen Gross TV Spendings Top 10 TV industries EURm (gross) 2011 YTD Deviation vs YTD in EUR m Food Cosmetics Trade & shipment Services -89 White Line TV spend in EUR m Food impacted by several different possible transient factors (e.g. raw material cost increase) Motor vehicles Beverages Telecommunication Finance Pharmacy Detergents Total YTD: Jan-Aug 2011, excl. Media; Television advertising market, gross Source: Nielsen Media Research/SevenOne Media, Market Intelligence ( ) Page 26

27 Positive development since Q2 Revenues 2011 vs. 2010, in percent Q1 Q2 Q3 (estimate) +3-5% +3-4% +3-4% +3-4% -4% -2% Market 7.1M ex N24 in 2010 Market 7.1M ex N24 in 2010 Market 7.1M ex N24 in 2010 Note: Q1 and Q2 adjusted for N24 disposal in 2010 (deconsolidation on June 30, 2010) Page 27

28 We confirm flattish* outlook for German TV ad revenues Scenario 1: Same on-top bookings as in 2010 Scenario 2: Less on-top bookings as in 2010 Initial yearly/ commitments +3-4% +3-4% On top bookings 9% as in 2010 less than % Total revenues +3-4% flat * adjusted for N24: German TV ad revenues for P7S1 with slight growth; underlying revenue performance for German-speaking segment with at least low single digit percent growth Page 28

29 Strong sustainable position in an attractive market with significant upside potential 1 ProSiebenSat.1 with strong sustainable position in attractive market 2 TV media mix winner as the most effective and indispensable media 3 We stick to our guidance in 2011 with usual low visibility in Q4 4 TV rests on solid fundamentals with significant upside potential Page 29

30 Earlier this year: External market research firms expect growth in German Net TV ad market German Net TV ad market Prognosis % + 2.3% + 3.5% Quellen: Zenith Optimedia: Advertising Expenditure Forecasts July 2011, WARC International Ad Forecast July 2011, PWC: Global entertainment and media outlook SevenOne Media, Market Intelligence Page 30

31 Future growth potential of TV until Print cannibalization/media mix 2. Pricing/ad intensity recovery 3. Large HD & 3D screens 4. HbbTV 5. Combination TV/Online/Mobile 6. Regional advertising targeting 7. Ban public sponsoring/advertising 8. New market segments Page 31

32 1. Cannibalization of print as potential key growth driver Media usage and net media mix % 39% % 27% 10% 1pp increase in media mix equals ~150m EUR for the market and ~ 60m EUR for P7S1 0 3% 2% TV Newspaper Magazine Share of net media usage 2010 Share of media spendings 2010 Based on ZAW data; excluding direct mail and directories Source: ZAW, OVK, mindline media, OVK Werbestatistik (Onlineinvestments inkl. Search und Affiliate) / SevenOne Media Market Research Page 32

33 2. Strong recovery of net CPT drives market growth Net TV ad market, Net CPT EUR m, Index: 2007 = pp net CPT increase equals ~ 40m EUR for the market and ~ 16m EUR for P7S1* e 2012e Net TV ad market NET CPT Ad intensity: Net TV ad market as % of GDP n/a n/a Page 33 * Assumption: 50% of price increase leads to market growth, 50% to decrease in sold minutes Basis: All TV-HH, A 14-49, CPT: 9-channel market Source: AGF/GfK Fernsehforschung, DAP TV Scope, Nielsen Media Research, ZAW, estimate

34 2. TV with relatively small share of advertised products Total advertised products vs. TV advertised products FMCG ONLY 10% Total = 56,400 TV = 5,793 25% Total = 32,600 TV = 8,083 10% Total = 71,709 TV = 7,234 8% Total = 77,550 TV = 6,318 12% Total = 39,300 TV = 4,696 1 Total number of advertisers and total number of products estimated Source: IP: Television 2010 Page 34

35 2. Thus underproportional ad intensity in German TV market Ad intensity: TV Advertising as % of GDP, % recovery in ad intensity equals ~250m EUR for the market and ~ 100m EUR for P7S1; reaching European average would mean 1.25bn EUR for the TV ad market Western Europe USA Page 35 Source: Zenith Optimedia Advertising Expenditure Forecasts July 2011

36 3. Large HD & 3D screens drive TV and ad impact We believe: Better screens > more ad impact > higher prices > growing market Television Sales, PC and smartphones are estimated by EITO (European Information Technology Observatory), in cooperation with Bitkom Page 36

37 4. HbbTV convert TV ad into direct sales impact Establish direct response channel to generate additional revenues Drive interaction models (e.g. leads, coupons) Page 37

38 5. Potential ad impact of combined TV, Online & Mobile campaigns buy Online coupon identified via GPS buy in store TV drives reach + Online & Mobile drive interaction and conclude the on/offline sale Page 38

39 6. Regional TV might attack print budgets Regional TV ads specifically attack large regional print spend Technology now available for regional TV over cable Primarily focus on tapping advertising budget of new clients currently not advertising with TV or P7S1 USP: regionally targeted ads in highly attractive national broadcasting Upside potential of ~100m EUR for market and 40m EUR for P7S1 Source: P7S1 own estimate Page 39

40 7. Significant upside potential through public ad ban EUR m ~ 250 market ~ 100 PS71 Significant upside potential through public ad ban ~ 50 market ~ 20 PS71 Ban ads at public stations Ban sponsoring at public stations (2013) Source: P7S1 own estimate Page 40

41 8. New market segments (example betting) Ban of TV advertising in online betting segments challenged by EU commission TV highly attractive for betting companies Additional market potential of > 80m EUR Page 41

42 In summary: German Net TV ad market with significant upside potential EUR m , ,105 1,350 ~ 3, ,900 Net TV ad market 2011 Media mix gain (+3%pt; print cannibalization) Recovery TV ad intensity (+0.015%) Transaction models (Hbbtv, Mobile) Regional/TV Ban Public Sponsoring / advertising* New Market Segments (e.g.betting) Net TV ad market potential 2015 With net SoA of 42% increase of >500m EUR for P7S1 possible; conservative approach reflects ~1/3 (>150m EUR) Source: P7S1 own estimates Page 42

43 German TV ad market scenarios 2015 EUR bn Maximum potential Historic market Conservative scenario Flat 2010 Market downturn Market size Market growth Sales growth P7S1 > 0.5 ~ 0.15 ~ ~ Conservative 150m EUR growth approach allows for more upsides than downside risks Page 43

44 TV market risk perception might not materialize at all TV loosing to online Young viewers continue to watch TV Online reach additions limited Online ad more costly than TV; superb ROI doubtful Hybrid TV usage penetration possibly slower than in other key markets 2. TV pricing declining Net CPM already below other media CPM 3. Economic downturn Germany still a very attractive market Page 44

45 ... and TV ad market has further potential beyond 2015* 1. Premium pricing for selected target groups through individualized targeted TV ad campaigns 2. HbbTV is a major success 3. Premium entertainment TV channels for elderly people allow for premium pricing 4. Additional new categories (innovations, prescription pharmaceuticals) * not reflected in revenue potentials Page 45

46 Conservative German ad sales assumptions leave high upside potential Conservative approach with >150m EUR growth in Germany for P7S1 > 50m EUR for P7S1 in Austria/Switzerland Significantly more upsides than downsides until 2015 and beyond TV will remain medium leader for reasonable growth P7S1 will sustain its strong position in an attractive market Page 46

47 Disclaimer This presentation contains "forward looking statements" regarding ProSiebenSat.1 Media AG ("ProSiebenSat.1 AG"), its subsidiaries/affiliates and/or ProSiebenSat.1 Group as a whole (all hereinafter collectively referred to as P7S1 Group ), including opinions, estimates and projections regarding P7S1 Group's financial position, business strategy, plans and objectives of management and future operations and including opinions, estimates and projections regarding the markets in which it presently operates or in which it expects to operate in the future. Such forward looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of P7S1 Group to be materially different from future results, performance or achievements expressed or implied by such forward looking statements. These forward looking statements speak only as of the date of this presentation and are based on numerous assumptions which may or may not prove to be correct. No representation or warranty, express or implied, is made by ProSiebenSat.1, its subsidiaries/affiliates or P7S1 Group as a whole with respect to the fairness, completeness, correctness, reasonableness or accuracy of any information and opinions contained herein. The information in this presentation is subject to change without notice, it may be incomplete or condensed, and it may not contain all material information concerning P7S1 Group. ProSiebenSat.1 and its subsidiaries/affiliates undertake no obligation to publicly update or revise any forward looking statements or other information stated herein, whether as a result of new information, future events or otherwise. Page 47