TV ad spend will continue to flow to digital, but those dollars will be looking for branding-like impacts of awareness. This means that more of those dollars will flow into something like Facebook which has enormous reach (and frequency) while less will flow into performance channels like search.

1. Augustine Fou- 1 -
Left-side Right-side
branding performance
“Soup and Soda” “Cars and Computers”
• Low cost
• Low complexity
• Low consideration
• High cost
• High complexity
• High consideration

2. Augustine Fou- 2 -
TVvs Digital Ad Spend
2013 - $108B (U.S. Only)
2017E - $131B
branding performance
“Soup and Soda” “Cars and Computers”
Television 61% ($66B, 2013) Digital 39% ($42B, 2013)
Display
(Facebook)
22%
Search
(Google)
46%
Other
32%55% 45%
Broadcast Cable
Television 53% ($70B, 2017E) Digital 47% ($61B, 2017E)
49%
Other
9%49% 51%
Broadcast Cable Branding
(Facebook)
Performance
(Google)
42%

3. Augustine Fou- 3 -
The Grand Digital Canyon
Traditional
• TV
• Magazines
• Newspapers
• Radio
Digital
• Search
• Social
• Mobile
• Video
Metric:
Size of
Audience
Metric:
Actions of
Users

4. Augustine Fou- 4 -
The Evolution of Media
One-way Media Two-way Media
banner ads search ads
Always on
Always informed
Always connected
Many-Way Media
branding performance

5. Augustine Fou- 5 -
1st screen 2nd screen 3rd screen
• Television
• Magazines
• Newspaper
• Radio
• Display Ads • Search Ads
• Search Optimization
• Email
• Social Media
Marketing
• Mobile Marketing
awareness consideration choice purchase advocacy
• In-store
The Marketing Continuum
branding performance

6. Augustine Fou- 6 -
Role of the Channel
0% 20% 40% 60% 80% 100%
Email
Mobile App
Direct Mail
SMS Text Message
Website
Social Media (not paid)
Search
Radio
Print Ads
Online Display Ads
Social Display Ads
TV
Greeter (Awareness)
Influencer (Consideration)
Closer (Decision)
Source: Experian Marketing
Services March 2014
Sorted by
Awareness

7. Augustine Fou- 7 -
Traditional Digital
Metric:
Size of
Audience
Metric:
Actions of
Users
Pitching Catching+
Should be ...
+
Pitching AND Catching
“Advertisers can do their “pitching” with offline, one-way channels like
TV, print, and radio; but they should make sure they are doing enough
“catching” in digital channels when users come online to research their
purchases.”

8. Augustine Fou- 8 -
Digital is Mainly a
Performance Channel

9. Augustine Fou- 9 -
“When users come online to research their
purchases, advertisers should make sure
they can find the info they need to move
expeditiously down the purchase funnel to
the purchase – and therefore do the
„catching‟ and harvesting of ROI.”
-- Dr. Augustine Fou

10. Augustine Fou- 10 -
Digital is a Performance Channel
Source: IAB 2012 Annual Report
Retail is mostly
direct reponse.

11. Augustine Fou- 11 -
Within The Digital Channel
Display and social
(display) are for awareness
Search (organic and paid)
are most useful just before
the decision to purchase.
Source: Google Think Insights
branding performance
Display ads
(social, mobile)
Video ads
(desktop, mobile)
Consumer
Reviews
Search Ads Organic Search
Lead Generation
Twitter Ads

12. Augustine Fou- 12 -
Main Types of Digital Ads
Impressions
(CPM/CPV)
Clicks
(CPC)
Leads
(CPL)
Sales
(CPA)
• Display ads
• Video ads
• Social display
• Mobile display
• Search ads
• Mobile search
• Affiliate
revenue share
• Completed
lead forms
sold on cost-
per-lead basis
Awareness Performance

13. Augustine Fou- 13 -
Digital Ad Spend (IAB H1 2013)
Impressions
(CPM/CPV)
Clicks
(CPC)
Leads
(CPL)
Sales
(CPA)
Search 43%
$18.1B
Video 7%
$2.9B
Lead Gen 4%
$1.7B
11% Other
$4.8B
Source: IAB, 1H 2013 Digital Advertising Report, Oct 2013
$35.5B
Display 19%
$8.0B
Mobile 15%
$3.7B$2.8B
NOTE: revenues annualized from
actual 1H 2013 figures from IAB
(assumes $42B annual ad spend)
• classifieds
• sponsorship
• rich media
• email
$6.5B
branding performance

14. Augustine Fou- 14 -
Digital DR vs Branding by Industry
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Direct Response
Branding
Direct
response vs
branding by
industry
Travel is
heavily DR
while
entertainment
is mainly
branding
branding direct response

15. Augustine Fou- 15 -
What Users Find Useful...
• Recommendations
from friends
• Consumer
opinions/ratings
posted online

16. Augustine Fou- 16 -
Context of my thinking ...
Marketing and Advertising
Chief Digital Officer, HCG (Omnicom)
Business Strategy
McKinsey Consultant
Technology / Innovation
PhD, MIT Mat’l Science
Digital
Augustine Fou- 16 -

17. Augustine Fou- 17 -
Dr. Augustine Fou – Chief Digital Strategist
“Facebook is for branding and has the
reach to cannibalize revenues from TV;
Google will remain performance oriented
and better serve specific industries and
sectors – like cars and computers.”
FORMER CHIEF DIGITAL OFFICER, HCG (OMNICOM)
MCKINSEY CONSULTANT
CLIENT SIDE / AGENCY SIDE EXPERIENCE
PROFESSOR AND COLUMNIST
ENTREPRENEUR / SMALL BUSINESS OWNER
PHD MATERIALS SCIENCE (MIT '95) AT AGE 23
Augustine Fou@acfou
ClickZ Articles: http://bit.ly/augustine-fou-clickz
Slideshares: http://bit.ly/augustine-fou-slideshares
LinkedIn: http://linkd.in/augustinefou

18. Augustine Fou- 18 -
Related Articles
Trends in Advertising
By: Augustine Fou, Nov 15, 2012
Branding Today: Why It’s
Ineffective, Irrelevamt, Irritating, and Impotent
By: Augustine Fou, June 21, 2012
Search Kicks Display in Effectiveness
By Augustine Fou, April 2012
Display Ad Benchmarks
By Augustine Fou, August 2013
Augustine Fou- 18 -

19. Augustine Fou- 19 -
APPENDIX
Data Pack

20. Augustine Fou- 20 -
Combined Projections Mar 2014
eMarketer shows
TV decreasing
slightly as
percentage of
total ad spend
Digital will
continue to grow
at the expense of
print and other
offline forms

21. Augustine Fou- 21 -
U.S. Digital Ad Spend, by Format
Data derived
from IAB/PwC
data

22. Augustine Fou- 22 -
U.S. Digital Ad Spend, by Industry
Data derived
from IAB/PwC
data

23. Augustine Fou- 23 -
Combined Projections Aug 2013
Source: eMarketer, August 2013
eMarketer shows
TV still growing
strongly
Digital will
continue to grow
at the expense of
print and other
offline forms

24. Augustine Fou- 24 -
Global Ad Spend - ZenithOptimedia

25. Augustine Fou- 25 -
ZenithOptimedia

26. Augustine Fou- 26 -
ZenithOptimedia (2011)

27. Augustine Fou- 27 -
eMarketer Aggregated Data

28. Augustine Fou- 28 -
Change in Ad Spend
Source: Kantar Media, December 2013

29. Augustine Fou- 29 -
Change in Ad Spend
Source: Kantar Media, December 2013

30. Augustine Fou- 30 -
Power Shift to Consumers
Augustine Fou- 30 -
92% trust
“recommendations from
people I know”
47% trust
“ads on TV”
29% trust “text ads on
mobile phones”
33% trust
“online banner ads”
Source: Nielsen, April 2012
Users trust peers the most, ads the least.