How eMarketer Estimates Spending on US Mobile Advertising

HOW EMARKETER ESTIMATES SPENDING ON US MOBILE ANVERTISING {2013 PROJECTED MOBILE $765 BILLION AD SPENDING: ..( 2012 ESTIMATED 75.3% J.J7 INCREASE FROM 2012 IN 2013 HOW DID WE ESTIMATE THAT? Every figure eMarketer publishes is the result of comprehensive analysis of information collected from virtually every research source covering a given topic. We carefully evaluate these data sets for historical accuracy, definitional discrepancies and methodology - all before incorporating them into our own analytical models. These models then inform our conclusions about the overall market. WE CREATE BOTTOM-UP MODELS FOR MAJOR PLAYERS IN THE US MOBILE AD MARKET BY BUILDING COMPANY FIGURES DOZENS OF DATA TYPES ARE GATHERED ON THESE COMPANIES FROM: 50A 300+P +888 100+A VIERWIEWS 300+ RESEARCH FIRMS WITH INDUSTRY EXECS DATA POINTS THEN WE ANALYZE THOSE DATA POINTS TO CREATE ESTIMATES FOR EACH COMPANY FOR EXAMPLE, TO BUILD GOOGLE'S MODEL, WE ANALYZED: REPORTED FIGURES FIGURES FROM FROM GOOGLE: OUTSIDE SOURCES: • Revenue figures • Traffic acquisition costs • Usage • Other disclosures • Revenue estimates from research firms • Ad impression estimates and pricing • Interviews with industry executives • Site traffic and other figures RESULT: $3.9 BILLION US MOBILE AD REVENUE TOP-EARNING COMPANIES, BY MOBILE AD REVENUE $1.1 B $378 M $375.7 M $266 M $212.9 M $94.4 M FACEBOOK YP PANDORA TWITTER APPLE (iAD) MILLENNIAL MEDIA INCORPORATING OUR FINDINGS ON EACH COMPANY, WE THEN BUILD MODELS FOR EACH MOBILE AD FORMAT WE ANALYZED 42 DATA POINTS FROM 9 RESEARCH SOURCES (THE ESTIMATES VARY WILDLY) From this analysis, as well as our own knowledge of the marketplace, we concluded: DISPLAY SEARCH MESSAGING VIDEO ОТНER Research Estimates: eMarketer Estimate: Research Estimates: Research Estimates: Research Estimates: $714 M - $3.4 B $954 M - $3.9 B $215 M - $468 M $294 M - $517 M $100 M eMarketer Estimate: eMarketer Estimate: eMarketer Estimate: eMarketer Estimate: $3.38 B $3.95 B $216 M $518 M WE SUBSTANTIATE OUR BOTTOM-UP MODELS BY ANALYZING OVERALL MOBILE AD MARKET ESTIMATES WINTERBERRY GROUP (S7.2B 77%) J.P. MORGAN (S7.1B 79.8%) WE COMPARED: JMP SECURITIES (S5.9B 76% • 49 DATA POINTS • 27 ESTIMATES OF MOBILE AD COWEN & COMPANY (S5.7B 67.8%) BARCLAYS CAPITAL (S5.4B 70.2%) BIA/KELSEY (S5.4B 66.9%) JEFFERIES (S4.4B 56.7%) SPENDING CANTOR FITZGERALD (S4.3B 65%) • 22 ESTIMATES THINKEQUITY LLC (S4.3B 55.2%) FOR MOBILE AD PIVOTAL RESEARCH GROUP (S4.3B 43.3%) SPENDING GROWTH FORRESTER RESEARCH (S4.2B 52.5%) PRICEWATERHOUSECOOPERS (PWC) (S3.8B 45.8%) We compare and validate all findings to growth trends in areas related to mobile advertising, including smartphone, tablet, and mobile social network usage; overall economic growth; B2C mcommerce sales growth; overall digital and total media advertising spending growth; and other factors. ZENITHOPTIMEDIA (S1.9B 50.4%) WILLIAM BLAIR & COMPANY (S1.5B 38.3%) Estimated % of mobile ad spending growth Estimated total mobile ad spending dollars (billions) IN TOTAL, OUR COMPREHENSIVE ANALYSIS COMBINED: 400 DATA POINTS, 100+ RESEARCH SOURCES, DOZENS OF DATA TYPES & MULTIPLE MODELS $7.65 BILLION IN 2013 eMarketer. Numbers are rounded. "eMarketer evaluated these figures based on methodology and definitions, accounting for frequent discrepancies and variance from firm to firm, before incorporating each data set into our own statistical model. SOURCES: Apple · Barclays Capital - BIA/Kelsey· Cantor Fitzgerald - Credit Suisse · Cowen and Company · Facebook Google · JMP Securities · J.P. Morgan · Jefferies · MAGNAGLOBAL · Millennial Media - Pivotal Research Group - William Blair & Company · PricewaterhouseCoopers · Winterberry Group - Yankee Group Yellowpages · Forrester · ZenithOptimedia %24