Rich media and video advertising as engines for growth Goldbach Audience Business Line In a tense European business environment and a generally stagnant advertising market, online video advertising and automated trade with online display advertising is gaining acceptance.
Marketing of online advertising The companies in the Goldbach Audience Business Line have business operations in the marketing and brokerage of online-display, video, Internet-TV, mobile and in-game advertising. The companies market classic advertising platforms such as the news portals of large publishing houses, as well as business-community platforms such as XING and communication platforms such as Skype. The online marketing companies of the Goldbach Group identified the trend towards video and multi-screen advertising early on and were able to transpose the Group s strong position in the marketing of classic TV advertising to the marketing business for moving-image advertising on the Internet. In February 2012, Goldbach Audience (Switzerland) launched the Goldbach Video Network as the online video advertising offering with the broadest reach in the Swiss market. With more than 30 prominent advertising platforms registering more than 40 million videostreams each month, the offer reaches two-thirds of Swiss Internet users with video advertising. Target groups are placed with advertisers within the advertising networks of the Goldbach Audience Companies. To accomplish this, the Companies aggregate sites and digital advertising platforms to create broad-reach and market-tailored advertising; this enables an effective and efficient appeal to target groups using advertisingcontrol technologies. The ongoing fragmentation of target groups by the rapidly rising number of dissemination channels and devices calls for advertising-control technologies that can reliably and efficiently reach the consumer through different screens. With this objective in mind, Goldbach Audience uses multi-screen advertising technology that can disseminate moving-image advertising to computers, tablets and smartphones. The national companies within the Business Line act as intermediaries for online-display and video advertising. In this they constitute one of the largest independent online advertising networks in Switzerland, Austria, the Adriatic region and Eastern Europe. In fact, the network of the national company in Poland reaches 90% of all Polish Internet users. Market trend: towards moving-image advertising In 2012 the market for online advertising was marked by the uncertain economic situation in Europe and a levelling-off of sales growth. Within the segment, there was a shift away from the stagnating and in some cases downward-trending market for conventional display advertising and towards rich-media and online video advertising. Online video and large formats remain the engine for growth in the segment of online display advertising. According to estimates by Forrester Research, in the US market, by 2016 some 76% of display advertising will be attributable to rich-media or video advertising formats. The European markets can be expected to undergo a similar change.
US Interactive Display Media Forecast (Media spend (US$ billions) 2010 2011 2012 (F) 2013 (F) 2014 (F) 2015 (F) 2016 (F) 2017 (F) CAGR Text ads $ 2 439 $ 2 987 $ 3 517 $ 4 199 $ 4 978 $ 5 878 $ 6 844 $ 7 662 16.9% Static image $ 1 962 $ 1 695 $ 1 144 $ 934 $ 653 $ 349 $ 77 $ 59-44.7% Rich media $ 3 402 $ 4 314 $ 5 173 $ 6 066 $ 7 176 $ 8 439 $ 9 801 $ 11 018 16.3% (exkl. video) Video $ 1 550 $ 2 061 $ 2 908 $ 3 890 $ 4 998 $ 6 326 $ 7 720 $ 9 225 26.0% Quelle: Forrester Research Online Display Advertising Forecast, 2012 bis 2017 (US), (F) = Forrester forecast For the core Swiss market, from now through 2015 Goldbach Audience forecasts 20% in average annual growth in the market for online video advertising and 24% for Goldbach Audience Switzerland. The Business Line benefits from this trend; with the Goldbach Video Network and the Wilmaa Internet TV platform, it provides advertisers and agencies advertising media with the broadest reach in the market. More video usage means more video advertising: Quelle: Goldbach Estimates Swiss Video Market and GVN Development
Quelle: PricewaterhouseCoopers AG Mobile use of the Internet has risen sharply as a result of the rapid spread of smartphones and tablet computers. In some markets, 50% of usage is already accounted for via mobile networks. This trend is accelerated by the end devices increasing performance and the higher speeds of data transmission. The trend towards mobile use of the Internet poses a great challenge for content providers that refinance through advertising. This is because advertising on mobile end devices generates significantly lower thousand-contact prices than advertising on conventional computers. For publishing houses, this development makes mobile usage of editorial content a blessing and a curse at the same time. The introduction of payment models using so-called pay walls will also have an influence on the range of publishing-house and media portals. Market segmentation: quality and advertising effectiveness Automated trading in the inventory of online advertising arrived in Europe in 2012, in the form of the segmentation of the market for online display advertising into premium and non-premium segments. Target groups and ad impressions are traded in real time through automated marketplaces. Not only individual sites but also entire networks offer portions of their advertising inventory or of their ad impressions for appeals to specific kinds of target group, either at fixed prices or using an auction process. Automated purchasing of target groups on the basis of sociodemographic or psychographic attributes replaces classic media planning and conventional media purchasing. There are no purchases of content or milieus as stand-ins for target groups; instead, ad impressions are purchased for target groups with specific interests. Data collection and analysis, together with the control of advertising based on this information, is becoming increasingly important.
Automated trade in advertising also raises questions about the quality and impact of online display advertising. In the case of trade with advertising inventory in milliseconds, there is a danger that advertising placements that are not located in the visible portion of the screen, or that are seen for just a fraction of a second, will be sold at prices ordinarily charged for high-quality pop-up adverts. The Internet Advertising Bureau (IAB), the international industry organisation for online advertising, together with several platform operators and marketers, have launched initiatives to measure the visibility of online display advertising and its length of view. This more systematic focus on the qualitative aspects of display advertising is expected to further propel the segmentation of the market into premium and non-premium inventories. e-privacy To avert enactment of provisions of EU legislation relative to targeting, IAB Europe published a framework for self-regulation of use-based online advertising (OBA) back in 2011. This framework is meant to provide the consumer with greater transparency of and control over online advertising. The framework, which is available at the IAB Europe website, follows the requirements established by the EU. Nearly all of the major Internet companies and online-advertising marketers are already signatories of the framework. As a corporate member and sponsor of IAB Europe, in 2012 the Goldbach Group completed preparations for international introduction and certification of OBA and will inspect and certify all markets and Goldbach Audience and Interactive companies in view of their compliance during the course of the first quarter of 2013. Switzerland Launch of Goldbach Video and Goldbach Mobile Network In the core market in Switzerland as well, developments in technology are leading to fundamental changes and a new understanding of roles on the part of market participants. Site operators, publishing houses, agencies, marketers and brokers of online advertising are reorienting their offerings and services. Media agencies are increasingly doing business as brokers of online advertising trading in advertising inventory over their own trading desks. Publishing houses are establishing their own networks and exchanges of offerings. Operators of advertising networks such as Goldbach Audience are aggregating advertising platforms to broad-reach offerings and brokering ad impressions for specific target groups. The Goldbach Video Network launched in February 2012 has established itself as a successful offering in the market. (Further information about the Goldbach Video Network). With the Goldbach Mobile Network launched in the third quarter of 2012, advertisers can also reach consumers on the most personal of their end devices. The Goldbach Group invested in this area early on and provides its customers and partners with the entire spectrum of services and technologies in the field of mobile marketing.
US Real-Time Bidding (RTB) Digital Ad Spending, 2010-2016, (millions, % change and % of total digital display ad spending) Wilmaa Internet TV on mobile devices and tablet computers Wilmaa GmbH (formerly Gartenhof Medien GmbH), a subsidiary of the Goldbach Group and the operator of the Wilmaa Internet-TV platform, can look back on a successful financial year. The dissemination of TV via Internet has established itself in Switzerland as a complement to conventional TV. While competitor offers were launched as well, the dissemination of Wilmaa is continually rising. With more than 1 million registered users and according to NetProfile a monthly reach of approx. 400,000 users, Wilmaa is the leading Swiss Internet-TV platform. Mobile usage via tablet computers and smartphones continued its rapid rise in 2012 as well. Wilmaa offers its advertiser-financed service on all end devices and screens, and in the course of the year the applications for tablet computers and mobile phones were constantly updated with new features. Austria Expanded reach and creative advertising formats The classic advertising market achieved gross growth of 2.6% in Austria in 2012 compared to the previous year. Gross advertising sales for the online media form totals to EUR 128 million. Because of a difference in survey area, these sales figures are not comparable with those for 2011 (source: Media Focus Research, November 2012). Slightly negative trends are forecast for the overall advertising market in 2013, although Internet and new media will distinctly outperform the remaining advertising market with an estimated sales increase of 10%. The greatest growth in online advertising is expected in the areas of social media and mobile marketing (source: Media Focus Research, November 2012). The range of the Goldbach Audience Channel was continually expanded in 2012. The dissemination reported using the WA Plus (the Austrian Web Analysis a volunteer-member amalgamation of online providers and advertising agencies) measurement encompasses nearly 3 million unique users, or 52% of all Austrian Internet users. Since May 2012, sms.at, one of Austria s largest entertainment and communication portals, has been
available for booking exclusively through Goldbach Audience Austria. Other new additions include RiCtv.at, wecarelife, mobile.de, gulli.com, viennaairport.com, IP and krone.at and Ebay, which have been integrated in select channels or combination products. Thanks to new sites such as krone.at, viewster.com, spykeheels.com and kost-bar.tv, the range of moving-image advertising in the portfolio increased as well. In co-operation with Plista, since February 2012 Goldbach Audience Austria has also offered customers in Austria performance-based advertising models on a cost-perclick basis under the name of the Austrian Performance Network. Adriatic region Acquisition and reorganisation The weak economic situation seen in the Adriatic region in recent years is reflected in the trend for online advertising as well. While the gross official advertising statistics for Slovenia are on a par with the previous year, in terms of net developments, Goldbach Audience sees a decline of 10 to 15%. As this difficult situation continues, the overall market for online display advertising continues to hover at the previous year s level. To boost business in Croatia and Slovenia, during the third quarter of 2012 the Goldbach Group entered into a strategic partnership with Pristop, the region s largest advertising agency, and took over a majority share of its digital agency, Renderspace. This expansion places Goldbach Audience companies in a position to significantly expand their direct-customer business. Customers have the benefit of the reach of the Goldbach Audience Networks, representing 90% of consumers in Croatia or 1.6 million users. Launched in Croatia in October 2012, the Goldbach Video Network opens up further growth potential in the area of online video advertising. The largest partners, such as RTL, Nova TV, EPH and Styria, were incorporated into the Goldbach Video Network. Czech Republic Reduction to a sales outlet In light of the ongoing difficult market situation for online advertising in the Czech Republic, Goldbach Audience in Prague was reduced to a sales outlet that is technologically and administratively managed by Goldbach Audience Poland. Goldbach Audience continues to monitor developments here in order to take suitable steps.
Poland Reorganisation, innovation and focus on high-margin products With new management for its activities in Central and Eastern Europe and a successful reorganisation, the efficiency of Goldbach Audience Poland (until 31 December 2012: ARBOmedia Poland) improved significantly. Financing and administration of these companies was more closely incorporated into the Group. Reorganisation of the sales organisation and a sales team for direct customers resulted in a considerable increase in sales in this segment. At the same time, the marketing network was tightened, and agreements with advertising media that were not in a position to meet expectations were not renewed. Despite this consolidation, the reach of the Goldbach Audience Network in Poland is second only to Google s. The company received honours as the second-best advertising-marketing company for classic and online media. With a trading platform of its own, Goldbach Audience Poland is an innovation leader in fast-growing real-time bidding in Poland. Takeover of exclusive marketing of the online platforms of Viacom also laid the cornerstone for the Goldbach Video Network. Romania Synergies with Goldbach Media In a manner similar to Goldbach Audience Poland, the corporate structure and organisation of Goldbach Audience Romania was consolidated as well. In 2012, amalgamating the operative units of Goldbach Media and Goldbach Audience under a single management, tapping synergies with the sales division of Goldbach Media, and tightening up the network and partner agreements all created the basis for profitable growth.