IAB report on Online Ad Spend. The Netherlands H1 2014

IAB report on Online Ad Spend

September 2014

Introduction

Since 2010, IAB and Deloitte are publishing the Online Ad Spend Report for the Netherlands. The

contents of this report is driven by data and information gathered directly from the online community,

including publishers, advertisers and media planners. Due to a great number of participating key industry

players we are able to gain extensive insight in the market and offer the most accurate online advertising

market figures.

Starting this edition, we will present our report in a new format on a quarterly basis. This way, data is up to date and aligns better with the industry requirements by providing relevant market information on a similar frequency with business reporting periods. Data will be presented in a new way and reflects key numbers. The quarterly reports of Q1, Q2 and Q3, will be followed by a full year report, that is still presented in the full format as started since 2010.

Methodology

Collection

Estimation

Conversation

Validation

Deloitte collects data covering the majority of the market

Missing participants’ data is estimated based on previous figures, desk research, expert opinions, industry databases, extrapolation and modeling

Initial findings are verified with industry experts, media buyers and selected publishers

Findings are cross-referenced and validated with respondents

Publication

Final findings are presented to the IAB

and industry participants

Survey methodology

• Our current survey is based on 31 participating companies listed in the end of this report

• Figures are adjusted for double counting, based on information provided by the survey

participants

• The figures are drawn up on the basis of company input and have not been verified by Deloitte • Only aggregated results are

published, individual company information is held in strict confidence with Deloitte

Executive summary

Total online advertising market has shown excellent performance this year with a growth of

14% and 701m€ revenue in H1 2014

Search

advertising has

grown

with

+13%

to

293m€

and is the biggest category in online

advertising this half year.

Display

is this years

winner

with an

impressive growth

of

+16%

to

292m€

revenue which adds

up to a

market share

of

42%

, on par with search

Classifieds shows double digit growth

of +11%, performing little behind display and search, with a

total revenue of 116m€

for the first half of this year and a 16% market share

Embedded IAB formats

is traded most frequently through

Programmatic

platforms with

62% of the revenue,

this is double than the

31%

share Programmatic over

all display revenue

Video

is the

fastest growing format

with

+46%

totaling

41 m€

in revenue in the first half of 2014

Mobile

is the best performing medium with +72% growth

in revenue compared to last years first

half. As of Q2 mobile has reached a 14% market share in display advertising

CPM

continues to grow as of payment model. In the Q2 63% of the

display spend was negotiated on a CPM basis

Affiliate networks

profit from the improved online market, the 69 m€

revenue of this first half,

translates into a respectable growth of

+13%

showing positive numbers again after the market

stagnation last year

Online advertising market in the Netherlands

260 293 253 292 104 116 H1 2013 H1 2014 701

Note: The Internet figures we report are after agency discount that in some cases may apply; Search number are estimated based on annual reports, media buyers and media agencies feedback; Classifieds, directories & listings are based on a limited number of data points;

Source: Survey respondents, Media buyers, Annual reports, Deloitte analysis

Net/Net Advertising market (m€)

Search Display Classifieds +11% +16% +13% +14% 617 Revenue Growth 2013 H1 2014 +11% +13% +16% +7% -2% +14% Total +8% +14%

Display format

Display revenue, H1 2014 revenue growth per format

Note: Formats include estimates of non participating companies; Growth rate and or additions may not equal presented numbers due to rounding Source: Survey respondents, Deloitte analysis

28 28 41 48 147

2014 H1

€ 292m

Embedded (+17%) Q1: € 70m Q2: € 77m Interruptive (-2%) Q1: € 22m Q2: € 26m Video (+46%) Q1: € 19m Q2: € 22m Text links (-3%) Q1: € 16m Q2: € 12m Other (+21%) Q1: € 14m Q2: € 15m 23 29 28 49 126

2013 H1

_{€ 255m}

Medium

Share of display advertising revenue per medium %

Note: Share of each medium is based on repondents data only; Mobile advertising is specified spend by advertisers on mobile website or in-app ads Source: Survey respondents, Deloitte analysis

0% 5% 10% 15% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2012 2013 2014 Email 80% 85% 90% Web browser M a rket sh a re o f Di sp lay % Mobile Revenue Growth H1 2014 +10% 0% +72%

Mobile display advertising

25% 50% 75% H1 H2 Q1 Q2 2013 2014

Mobile website and In-App advertising share in the mobile display revenue (%)

Mobile website

In-app

Source: Survey respondents, Deloitte analysis

S h a re o f M o b ile d ispla y m a rket %

Programmatic trading

Share programmatic on display revenue H1 2014

Note: Embedded is split into IAB and non-IAB formats, with 38% and 12% market share of display revenue respectively; share Programmatic is based on repondents data only; share Programmatic = Programmatic ad spend / Total ad spend;

Source: Survey respondents, Deloitte analysis

69%

M

an

u

a

l

2014 H1

Display revenue

Embedded (IAB formats)

62%

Text links

28%

Interruptive

11%

Video

7%

Embedded (Non-IAB formats)

11%

Other

0%

Display format and Programmatic

Programmatic landscape for display formats H1 2014

Note: Display format Other is omitted due to 0% share Programmatic Source: Survey respondents, Deloitte analysis

Display format Trend based on Q1  Q2 revenue growth

Share Programmatic % M a rket sh a re o f Di sp lay % Video

Embedded (IAB format)

Interruptive Text links Embedded (Non-IAB format) 0% 25% 50% 0% 25% 50% 75%

Payment model

Note: Amounts may not equal 100% due to rounding and omission of “other” category Source: Survey respondents, Deloitte analysis

Share of display advertising revenue per payment model %

57% 29% 14% 59% 24% 16% 63% 20% _17% CPM CPX Fixed Fee 17% 9% 2% 12% 12% 1% 10% _9% 1% CPS CPC CPL 2013 Q1 2014 Q2 2014

Affiliate marketing

Q1 32 Q1 36 Q2 29 Q2 33 Q3 28 Q4 38 2013 2014 H1 69 +12% +14% H1 61 H2 66 FY 127 +13%

Source: Survey respondents, Annual Reports, Deloitte analysis

Online advertising market in the Netherlands

476 544 598 487 520 587 195 191 211 2012 2013 2014F 1396 1158 1255

Note: Forecast for Display and Classifieds is calculated using regression on the monthly Y/Y Growth Rate; Forecast for Search is calculated using regression on the 6 monthly Y/Y Growth Rate; Growth rate and or additions may not equal presented numbers due to rounding;

Source: Survey respondents, Agency Feedback, Annual reports, Deloitte analysis

Forecast 2014

Net/Net Advertising market (m€)

Search Display Classifieds -2% +10% +13% +10% +7% +14% +8% +11%

Online advertising market in the Netherlands

Note: Growth rate and or additions may not equal presented numbers due to rounding; Source: Survey respondents, Agency Feedback, Annual reports, Deloitte analysis

Forecast 2014 per quarter

Net/Net Advertising market (m€)

H1 2014 H2 2014F H1 292 H2 295 H1 116 H2 95 598 587 211 Online category Y/Y Growth Rate

Q1 2014 Q2 2014 H1 2014 Q3 2014F Q4 2014F H2 2014F Search +13% +7% Display +14% +18% +16% +12% +9% +10% Classifieds +13% +10% +11% +10% +9% +9% Total online +14% +9% Search Display Classifieds Q1 60 Q1 140 Q2 55 Q2 152 H1 293 Q3 45 Q3 130 Q4 50 Q4 165 H2 305

Participating companies

 AD2ONE  Addurance  Adfactor  AdLantic  Affilinet Nederland  BrandDeli  Daisycon  FD Mediagroep  Funda Real Estate  Mannenmedia  Marktplaats Media  MediaScience  Microsoft  Mobile Professionals  Nakkomedia  Persgroep Advertising  RTL Nederland  Sanoma  SBS Broadcasting  Semilo  Smartclip Benelux  Spil Games  Ster

 Telegraaf Media Groep  The Online Company  Tibaco Internet Media  ToTwenty

 Tweakers.net  Vergelijk.nl  Widespace  Zanox

Definitions

Categories

• Display

– Embedded formats (banners, buttons, skyscrapers etc)

– Interruptive formats (rich media, over the page, page take-over etc) – Tekstlinks (incl. AdSense)

– Video (pre-/mid-/ postroll)

– Other uncategorized display advertising

• Online classifieds, directories & listings

– B2B – B2C – C2C

Payment models

– Fixed Fee: Payment model based on a fixed fee

– CPM: Cost per Mille = Payment model where the advertiser pays per thousand views – CPC: Cost per Click = Payment model based on the number of clicks on an advertisement

– 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 to be interested

Contact

Roel van Rijsewijk Deloitte | Deloitte Digital Tel: +31 (0)6 52 615 087

Email: rvanrijsewijk@deloitte.nl

Roel van Rijsewijk is a Partner 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

For questions concerning this research feel free to contact:

Nathalie la Verge IAB Nederland

Tel: +31 (0)85 401 0802 Email: nathalie@iab.nl

Dutch IAB research includes the IAB / Deloitte Ad Spend Study, all IAB commissioned research and assisting IAB members with their research projects. Also responsible for shaping the IAB knowledge base so that it meets members' needs moving forward

Jorrit Sloot

Deloitte | Deloitte Risk Services Tel: +31 (0)6 82 019 387

Email: jsloot@deloitte.nl

Jorrit Sloot is a Consultant within the Deloitte Risk Services practice and specialized in data modeling, mathematical and quantitative data analyses

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