IAB Europe Adex Benchmark 2013

IAB Europe Adex Benchmark 2013 Daniel Knapp Director Adver=sing Research IHS

@IABEU_Interact #Interact2014

ABOUT THE STUDY


A meta-‐analysis of online ad spend in Europe

GROSS

Revenue Billed

NET

Revenue Billed No Agency commissions @IABEU_Interact #Interact2014

RATECARD

Campaigns x Ratecard

Submissions from 26 European countries •  •  •  •  •  •  •  •  •  •  •  •  • 

Austria Belgium Bulgaria Czech Republic Croa=a Denmark Finland France Germany Greece Hungary Ireland Italy

•  •  •  •  •  •  •  •  •  •  •  •  • 

Netherlands Norway Poland Russia Romania Serbia Slovakia Slovenia Spain Sweden Switzerland Turkey UK @IABEU_Interact #Interact2014

Added format granularity & context


BIG PICTURE & CONTEXT


The value of online adver=sing in 2013

€27.3bn @IABEU_Interact #Interact2014

2004 Q1 2004 Q2 2004 Q3 2004 Q4 2005 Q1 2005 Q2 2005 Q3 2005 Q4 2006 Q1 2006 Q2 2006 Q3 2006 Q4 2007 Q1 2007 Q2 2007 Q3 2007 Q4 2008 Q1 2008 Q2 2008 Q3 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2013 Q2 2013 Q3 2013 Q4 2014 Q1

Eurozone economy is coming out of a double-‐dip recession GDP Growth in Europe (%)

Eurozone GDP Growth France GDP Growth Italy GDP Growth


6

4

2

0

-‐2

-‐4

-‐6

Germany GDP Growth

-‐8

Double-‐digit growth in online adver=sing in 2013 Total online adver8sing (€bn) 35 30 25

11.9% like-‐for-‐like € 24.4

€ 27.3

20 15 10 5 0 2012

2013 @IABEU_Interact #Interact2014

A historical perspec=ve Total online adver8sing spend (€bn)* 35 30

€ 27.3 € 24.4

25

€ 21.9 € 18.8

20 € 14.5

15 10

€ 15.8

€ 9.2

€ 6.6

5 0 2006

2007

2008

2009

2010

2011

* Source: IAB Europe for 2011-‐2013; 2006-‐2011 retropolated based on IHS growth rates


2012

2013

In a vola=le market environment, online lièd overall ad spend 2013: adver8sing year-‐on-‐year growth 25%

21.2%

20% 15%

11.5%

10.8%

10% 5%

1.8%

0% WE

-‐5% -‐10%

-‐2.5%

-‐2.5%

CEE

Total Europe -‐1.7% -‐6.7%

-‐7.8% Total excl. online

Online

Total


Despite economic turmoil, online grew its ad spend per capita steadily since 2006

Ad spend per capita (€) 80 70 60 50 40 30 20 10 0 2006

2007

2008

2009 TV

Online

2010 Print

Other media


2011

2012

2013

Due to weak 2013 for all other media, online strengthened its posi=on as it approaches TV Ad spend by category in Europe in 2013 (€bn) TV

32.3

Online

27.3

Newspapers

20.0

Magazines

9.1

OOH

7.6

Radio

5.2

Cinema

0.7 0

5

10

15

20


25

30

35

However, no one online category has yet surpassed Newspapers ad spend Ad spend by category in Europe in 2013 (€bn) TV Online Newspapers

Display Classifieds & Directories

Magazines

Search

OOH Radio Cinema 0

5

10

15

20


25

30

35

Over half of all European ad spend comes from three markets Share of European online revenue by market 100% 86.6% 86.4%

90%

77.9% 78.2%

80% 70% 60%

69.4% 69.9% 57.3% 56.9%

50% 40% 30% 20% 10% 0% Top 3

Top 5

2012

2013

Top 7


Top 10

Aèr a tough year, Sweden increases in rank, helped by economic crisis in Spain

Netherlands Sweden

2012

2013

589 628

Italy

618 709

Russia

1,000

911 901

2,000

859 955

3,000

1,199 1,312

4,000

1,503 1,703

5,000

1,454 1,843

6,000

3,343 3,494

4,253 4,676

7,000

6,383 7,381

8,000

Total online ad spend (€m)

Spain

Norway

Denmark

0 UK

Germany

France


Growth drivers

Social media Video Rich media Mobile internet penetra8on increasing across all of Europe Programma8c and RTB come into the mainstream E-‐commerce driving C&D growth @IABEU_Interact #Interact2014

Growth hurdles AQrac8ng brand spend online Measurement Mobile Video inventory – s8ll very limited TV dominance in some European markets Data literacy Regula8on @IABEU_Interact #Interact2014

0% -‐5%


-‐2.0%

-‐1.1%

3.0%

4.3%

6.2%

6.6%

6.9%

4.5%

5%

9.4%

10%

9.8%

10.0%

10.7%

10.9%

11.1%

11.4%

11.9%

12.9%

13.0%

13.3%

13.4%

15.7%

16.0%

14.7%

15%

16.2%

20%

17.3%

25%

Online ad growth like-‐for-‐like (yoy) 24.3%

30%

26.8%

Mix of CEE and WE markets above European average; Russia and Turkey only 2 markets above 20%

40%

Bubble size: market value in €m

35%

Russia

30%

Online ad market growth

25% Turkey

20% 15%

Slovakia Serbia

Austria

Hungary

Czech Republic Switzerland Italy Romania Poland 10% Germany Ireland Greece Sweden Finland Croa=a 5% Netherlands France Belgium Bulgaria Spain

Norway

UK

Denmark

0% -‐5%

-‐

Slovenia

20

40

60

80

Online ad spend per capita (€)

-‐10%


100

120

Uniform growth paferns in 2013 Online adver8sing growth year-‐on-‐year (%) 50% 40% 30% 20% 10% 0% -‐10%

0

5

10

15

-‐20% 2012

2013


20

25

30

The range of growth is converging across Europe Online adver8sing growth year-‐on-‐year (%) 40% 35% 30% 25% 20% 15% 10% 5% 0% -‐5%

2012

2013

-‐10%


FORMATS


Accelera=on in Display growth, Display and Search drove online ad spend in 2013

Year-‐on-‐year growth (%) 18%

15.5%

14.9%

16%

13.0%

14% 12% 10%

11.5% 11.9%

9.1%

8%

6.3%

6%

3.6%

4% 2% 0% Display

Classifieds & Directories 2012

Paid-‐for-‐search 2013


Total

Search and Display grow their share at the expense of Classifieds & Directories

Format shares of total online 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

34.1%

36.6%

36.6%

18.3%

14.9%

18.9%

2006

2007 Display

2008

47.3%

48.0%

47.1%

48.8%

49.2%

19.8%

20.7%

19.6%

18.5%

16.8%

2009

2010

2011

2012

2013

Classifieds & Directories

Paid-‐for-‐search


Other

0% -‐5% -‐10%


-‐5.4%

-‐3.1%

-‐2.0%

-‐0.7%

-‐0.2%

2.7%

4.8%

4.9%

5.2%

24.9%

25.9%

5%

8.1%

8.7%

9.3%

11.4%

12.3%

12.4%

13.4%

15.9%

13.4%

9.3%

10%

14.9%

15%

18.7%

20%

24.7%

25%

28.0%

30%

Display adver8sing growth year-‐on-‐year (%) 28.3%

35%

32.3%

A renaissance of Display adver=sing: mature markets saw strongest growth in 2013

Online video is now a significant part of Display adver=sing

0%


2.2%

2.9%

2.9%

5.4%

8.1%

10.3%

4.5%

5%

8.8%

10%

11.0%

11.7%

12.7%

13.1%

13.5%

15.0%

15.2%

15.3%

16.2%

14.4%

15%

16.2%

20%

19.1%

25%

20.5%

30%

20.5%

35%

29.0%

Video share of Display


4.3%

20.0%

24.1%

24.6%

26.4%

29.3%

32.0%

39.7%

40.5%

45.4%

46.4%

50.0%

52.0%

54.4%

60.0%

62.6%

70.2%

70.6%

71.3%

Online video growth year-‐on-‐year (%) 75.4%

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

94.1%

Growth in video strong, but no country achieves triple-‐digit growth

Video ad spend mirrors total online ad spend ranking

356.6

400

Online video ad spend (€m)

350

0


0.8

1.7

3.3

4.0

8.8

9.1

9.6

10.9

12.7

16.8

25.1

28.2

29.4

34.8

43.9

50

80.7

100

85.6

150

132.3

200

139.0

250

153.0

300

Mobile now has a double-‐digit share of online display

0%

2012

2013


0.7%

1.2%

1.4%

2.1%

2.2%

2.8%

3.1%

3.4%

4.6%

5%

4.9%

5.0%

5.4%

6.7%

8.7%

9.0%

9.2%

9.2%

9.5%

10%

11.5%

15%

13.5%

20%

16.4%

25%

25.1%

30%

Mobile display as a share of total Display

0% -‐5% -‐10%

Display including mobile


-‐5.4%

-‐3.1%

-‐2.0%

-‐0.2%

2.7%

4.8%

5%

5.2%

9.3%

11.4%

12.4%

13.4%

15.9%

9.3%

10%

13.4%

15%

18.7%

20%

24.7%

25%

Display year-‐on-‐year growth (%) 25.9%

30%

28.3%

35%

32.3%

This is more evident…

…when we remove Mobile from Display Display year-‐on-‐year growth (%) 35% 30% 25% 20% 15% 10% 5% 0% -‐5% -‐10%

Display including mobile

Display without mobile


Mobile is most important growth engine for online display

European Display with mobile: +14.9%

European Display without mobile: +1.1%


-‐20% -‐30%


-‐20.5%

-‐18.7%

-‐16.2%

-‐7.3%

-‐3.4%

-‐2.1%

-‐2.0%

-‐1.7%

-‐1.7%

20.0%

-‐10%

-‐0.6%

2.0%

3.3%

3.6%

3.6%

4.3%

4.9%

5.6%

8.4%

6.8%

-‐0.2%

0%

9.4%

10%

11.5%

20%

24.8%

30%

Classifieds & Directories year-‐on-‐year growth (%) 26.1%

40%

30.3%

Classifieds & Directories struggled in 2013 with 11 countries experiencing decline

Con=nued growth in Paid-‐for-‐search shows the success of the format

0% -‐5%


-‐2.0%

1.1%

3.7%

4.7%

5.2%

5.5%

6.0%

3.7%

5%

6.0%

10%

9.7%

12.0%

13.0%

13.5%

13.6%

15.0%

18.2%

18.5%

20.8%

18.9%

14.3%

15%

19.0%

20%

20.9%

25%

22.3%

30%

26.1%

35%

26.6%

40%

34.4%

Paid-‐for-‐search year-‐on-‐year growth (%)

Like in Display, Mobile is now a significant driver of Paid-‐for-‐search Mobile search as a share of Paid-‐for-‐search (%) 30% 25%

25.3% 20.0%

20%

16.8%

15%

12.6%

12.4% 9.8%

10%

9.0% 4.5%

5%

2.4%

0% Ireland

Austria

UK

Europe

Sweden

Germany


France

Hungary

Spain

OUTLOOK


By 2020, we expect there to be 2bn connected devices across Europe Europe: Installed connected devices (m) 2,500 2,000 1,500 1,000

Source: IHS


2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

-‐

2005

500

With growth driven by smartphones, tablets and smart TVs Europe: Installed connected devices (m)

Source: IHS


2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

-‐

2009

500

2008

1,000

2007

1,500

2006

2,000

Digital media adapters Pay TV set-‐top boxes FTA set-‐top boxes BD players Smart TVs PCs Game consoles Tablets Smartphones

2005

2,500

What this means is that there will be a huge increase in very small screens, sub-‐15”

Screen size (diagonal inches)

Average Screen Size by 5" category 110"-‐114" 90"-‐94" 80"-‐84" 70"-‐74" 60"-‐64" 50"-‐54" 40"-‐44" 30"-‐34" 20"-‐24" 10"-‐14" 0"-‐4" 0

200 2019

Source: IHS

400 600 Shipments (m)


800 2012

1000

1200

Thank you! Ques=ons?

Daniel Knapp @_dknapp [email protected]
