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LUMA Digital Brief 001 - The Good, the Bad & the Ugly of Digital Advertising

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LUMA Partners presents the "LUMA Digital Brief 001 - The Good, the Bad & the Ugly of Digital Advertising".

Published in: Marketing, Technology

LUMA Digital Brief 001 - The Good, the Bad & the Ugly of Digital Advertising

  1. LUMApartners Digital Brief 001 The Good, the Bad & the Ugly of Digital Advertising
  2. BAD: Digital Supply / Demand Imbalance SUPPLY DEMAND > 2,500  companies 200  companies
  3. UGLY: Digital Supply / Demand Imbalance SUPPLY DEMAND 2,500  companies 200  companies LUMApartners150  priori3zed 50  priori3zed > 90+% FAILURE RATE
  4. What’s the Good News? 3 Things: 1.  Secular Organic Growth 2.  Changing Business Models 3.  Scaled Exits
  5. GOOD: Significant Growth in Digital Market Source: eMarketer ($  in  billions) $0 $50 $100 $150 $200 $250 $300 2012 2014 2016 Digital0Ad0Spend Total0Ad0Spend $100 $0 $50 $200 $250 $150 US  Ad  Spend US  Digital  Ad  Spend CAGR 35% CAGR 10%
  6. GOOD: Exceptional Growth in Programmatic Source: eMarketer ($  in  billions) $0 $50 $100 $150 $200 $250 $300 2012 2014 2016 Digital0Ad0Spend Total0Ad0Spend US  Digital  Ad  Spend ProgrammaAc CAGR 53% CAGR 216% $20 $0 $10 $40 $50 $30
  7. Programmatic as a Business Model Media Low 40-50% Gross Margins I/O Based Spend SaaS Software High 70-80% Gross Margin Contractual Spend 5 – 10 x REVENUE MULTIPLE 0.5 – 2 x BUSINESS MODEL DRIVERS GROWTH OPERATING LEVERAGE PREDICTABILITY
  8. Programmatic Changes the Media Business Model Programmatic High Growth 70-80% Gross Margin Predictable Spend 4 – 8 x
  9. WARNING: LUMA Decks Usually Call for More M&A
  10. AD  TECH CRM  SOFTWARE INTERNET  GIANTS ECOMMERCE TELCO MARKETING MEDIA DATA REALLY GOOD: A Growing Pool of Strategic Buyers CONSUMER  INTERNET TECH  SERVICES Right Time Decisioning of Consumer Data   (Ad  Tech  and   MarTech)
  11. AD  TECH CRM  SOFTWARE INTERNET  GIANTS ECOMMERCE TELCO MARKETING MEDIA DATA CONSUMER  INTERNET TECH  SERVICES Right Time Decisioning of Consumer Data   (Ad  Tech  and   MarTech) NEW   ENTRANTS REALLY GOOD: A Growing Pool of Strategic Buyers
  12. New York – Palo Alto lumapartners.com

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