DAN ALEXANDERDIR. VIDEO STRATEGY, VALUECLICK MEDIA JUNE 21, 2013

GROW YOUR VIDEO COMFORT ZONE

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WHO WE ARE

Fast Facts

15 years of experience

1400+ employees

25,000 advertisers served

NASDAQ: VCLK

Why Is This Important?

Massive DMP with 25 sources of input

Reach the same users across devices

True cross-device campaign optimization

$40MM annual investment in our technology

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TODAY’S AGENDA = VIDEO IS YOUR FRIEND

Video Trend Spotting

TV vs. Digital Video

Grow Your Video Comfort Zone

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TREND SPOTTING: VIDEO AD SPENDING

$4B will be spent on digital video this year, up 41% YOY

As the fastest growing online ad format, video spending will reach $8B by 2016

2011 2012 2013 2014 2015 2016

$2.00

$2.93

$4.14

$5.75

$6.99

$8.04

US Digital Video Ad Spending, 2011-2016Billions and % Change

Digital video ad spending % Change

Note: Historical data up to 2011 is derived from Interactive Advertising Bureau (IAB)/PricewaterhouseCoopers (PwC) dataSource: eMarketer, Dec 2012

40.8%

46.5%

41.3%

38.9%

21.6%

15.0%

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TREND SPOTTING: TV AD SPENDING

$66B will be spent on TV this year, up 2.8% YOY

TV spending continues to dominate all screens, expected to reach $73B by 2016

2011 2012 2013 2014 2015 2016

$60.66 $64.54 $66.35 $68.54 $69.91

$73.05

US TV Ad Spending, 2011-2016Billions and % Change

June 2013

TV ad spending % Change

2.8%

6.4%

2.8%

3.3%

2.0%

4.5%

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TREND SPOTTING: BUDGETS SHIFT TO VIDEO

23% of digital dollars will go to video this year, increasing to over 30% in 2015

2010: $9.91

2011: $12.33

2012: $14.98

2013: $17.67

2014: $20.69

2015: $23.13

2016: $25.21

0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0%

62.9%

61.3%

57.9%

54.3%

49.7%

47.0%

44.8%

14.3%

16.2%

19.6%

23.4%

27.8%

30.2%

31.9%

15.5%

13.4%

12.1%

11.5%

11.5%

11.6%

12.0%

7.2%

9.1%

10.4%

10.8%

11.0%

11.2%

11.4%

Banners Video Rich Media Sponsorships

Note: Includes advertising that appears on desktop and laptop computers as well as mobile phones and tablets; data through 2011 is derived from IAB/PwC data; numbers may not add up to 100% due to roundingSource: eMarketer, Sep 2012

US Digital Display Ad Spending Share by Format 2010-2016% of Total and Billions

Tota

l S

pe

nd

ing

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TREND SPOTTING: TV-TO-VIDEO SHARE SHIFT

IAB, Yahoo and Microsoft Advertising: Digital Video Viewing, Budget Share Shift and Effectiveness

TV95%

Online5%

TV100%

TV90%

Online10%

TV85%

Online15%

Source: IAB/Nielsen Online Video Study, 2012

Reach

Shifting up to 15% of TV ad spend to video provides incremental and effective reach

Running digital video ahead of a TV spot enhances brand lift by 15% to 45%

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Television

$66B industry

One screen

1 main metric

60+ years history

TV VS. DIGITAL VIDEO

Digital Video

$4B industry

Multiple screens

Multiple metrics

5+ years history

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THE VIDEO LUMASCAPE

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4 WAYS TO MAXIMIZE VIDEO ROIASK THE RIGHT QUESTIONS…

CAN YOU TAKE MY CAMPAIGN ACROSS SCREENS?1 DO YOU PROVIDE VIDEO BRAND SAFETY ON EVERY SCREEN?2

DO YOU OFFER DATA-DRIVEN TARGETING?3 WHAT DOES SUCCESS MEAN TO YOU?4

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COMFORT ZONE QUESTION #1: CAN YOU TAKE MY CAMPAIGN ACROSS SCREENS?

What is the modern family?

That was then… This is now…

Americans on average owned 1 device

Today, Americans average

3+ devices

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COMFORT ZONE QUESTION #1: CAN YOU TAKE MY CAMPAIGN ACROSS SCREENS?

DESKTOP

Advertisers are taking a “Screen Agnostic” approach to Digital Video

• More brands are taking a ‘screen-agnostic’ approach to video buying/planning

• The assumption is TV & Digital Video buying/planning teams are consolidating efforts

• Marketers are starting to benchmark against cross-measurement analytics

SMARTPHONE TABLET CONNECTED TV

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COMFORT ZONE QUESTION #2:DO YOU PROVIDE VIDEO BRAND SAFETY ACROSS SCREENS?

Brand Safety & Compliance Vendors

• Digital video introduces additional layers of complexity

• In order to scale a digital audience, you need multiple publishers to reach them… That’s when ad networks come in handy.

• What level of brand safety is provided for video campaigns?

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COMFORT ZONE QUESTION #3:DO YOU OFFER DATA-DRIVEN TARGETING?

It’s undeniable that video is one powerful ad format

In our experience, we know that the combination of

VIDEO + DATA drives higher . . .

VIDEO COMPLETION RATES and CTR

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COMFORT ZONE QUESTION #3 DO YOU OFFER DATA-DRIVEN TARGETING?

BT Non-BT70.0%

75.0%

80.0%

85.0%

90.0%

Video Completion %

Audience Non-Audience Targeted Targeted

BT Non-BT0.00%

0.50%

1.00%

1.50%

2.00%

Video CTR

Audience Non-Audience Targeted Targeted

Execution

• Evaluated 3 top tier advertisers’ video campaigns for more than six months:

• Sports TV advertiser

• Auto advertiser

• Energy drink advertiser

• Compared the Video Completion Rate and CTR performance for each campaign

Results

• On average, campaigns that leveraged audience targeting exhibited a VCR of 11.1% higher than their non-targeted counterparts

• Similarly, campaigns that leveraged audience targeting exhibited a CTR of 84.5% higher than their non-targeted counterparts

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COMFORT ZONE QUESTION #4:HOW DO YOU BENCHMARK VIDEO RESULTS?

What is the “Holy Grail” for Video Measurement?

ClicksTime Spent

Dwell Rate Completion

Brand Lift

Conversion

Interactivity

% on targetCTR

Sharing/Commenting

GRPReach & Frequency

Engagement

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COMFORT ZONE QUESTION #4:HOW DO YOU BENCHMARK VIDEO RESULTS?

NIELSEN OCR BENCHMARKS

OCR in-target benchmarks aggregated across over 3,000 campaigns run to date.*

$10 = $22.73$10 = $45.45 $10 = $17.54

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LET’S SUM IT UP = TAKEAWAYS

Shifting money to digital video may seem daunting given the landscape

Ask the right questions before you initiate a video campaign

Ensure your vendor is driving towards your ROI goals

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@ValueClickMedia

THANKS FOR LISTENING!

Dan AlexanderDir. of Video Strategy

ValueClick Media

(818) 575-4576

[email protected]

/ValueClickMedia