January, 2009 “ Introducing Search in North Asia.” www.sozon.com Digital Marketing Specialists

The Asian Online Landscape SEO at 32% of the share is the strongest driver of traffic in Japan - Impress Internet R & D Whitepaper 2007

Asian Internet User Growth Geographic Distribution of Internet Users (MM) 390 490 620 723 850 975 1,120 1,299 Note: ROW denotes Rest of the World | Source: Morgan Stanley Research Asia (547MM users, +24% Y/Y); Europe (336MM, +10%); N. America (211MM, +3%); LatAm (110MM, +17%); ROW (95MM, +27%) Internet Users 15+: comScore World Metrix, April 2008 Asia now comprises more than 40% of the world’s Internet users & is still growing rapidly!

Asia also leads the world in many categories… Source: Morgan Stanley Research Mobile eCommerce: Japan MicroTransactions via SMS: Philippines Most Online Users: China Online Gaming: China Mobile Search: Japan Social Networking: S. Korea Blogging: Japan Broadband: S. Korea eGovernment: S. Korea

Regional Search Spend Growth Japan, Korea & China represent almost 82% of Asian online ad spending in 2008 Japan represents the biggest search market in Asia Korean search is proportionally the highest spend (almost 60% of total online spending) China is the largest growth market Million

Japan, Korea & China represent almost 82% of Asian online ad spending in 2008

Japan represents the biggest search market in Asia

Korean search is proportionally the highest spend (almost 60% of total online spending)

China is the largest growth market

APJ Internet user markets are still expanding rapidly, especially in SE Asia, China & India. More users means more searches. APJ online advertising markets are still maturing in terms of overall spend. So search will only become more important as a tactic as online spending increases. Search Marketing’s measurable effectiveness makes it more of a sure thing than many other forms of advertising both online & offline. Traditional advertisers now see search’s place in the broader realm of brand building and maintenance. The growing complexity of what is available online leads users to need search more than ever Growing sophistication among users leads them to search with increasingly wordy keywords, which leads marketers to bid on more keywords As paid search marketers in APJ become more experienced & sophisticated, they will bid on more keywords and generate better performances There is a growing understanding that search is not just paid advertising, this in turn boosts companies investments in SEO As ecommerce growth continues with emerging economies (i.e. buying online), this will translate into more value and higher volumes in searche Search is increasingly not just for websites, but also for specific content such as video, so the scope of search is also expanding 10 Reasons Search will continue to grow across Asia

APJ Internet user markets are still expanding rapidly, especially in SE Asia, China & India. More users means more searches.

APJ online advertising markets are still maturing in terms of overall spend. So search will only become more important as a tactic as online spending increases.

Search Marketing’s measurable effectiveness makes it more of a sure thing than many other forms of advertising both online & offline.

Traditional advertisers now see search’s place in the broader realm of brand building and maintenance.

The growing complexity of what is available online leads users to need search more than ever

Growing sophistication among users leads them to search with increasingly wordy keywords, which leads marketers to bid on more keywords

As paid search marketers in APJ become more experienced & sophisticated, they will bid on more keywords and generate better performances

There is a growing understanding that search is not just paid advertising, this in turn boosts companies investments in SEO

As ecommerce growth continues with emerging economies (i.e. buying online), this will translate into more value and higher volumes in searche

Search is increasingly not just for websites, but also for specific content such as video, so the scope of search is also expanding

Search Engine Market Share in Asia 60% 18% 10% 55% 45% 60% 10% 20% 27% 64% 20% 70% 5% 20% 75% 25% 51% 23% 43% 10% 43% 31% 11% 21% 71% 4% 5% 11% 77%

3 Key differences in North Asia Search Language & Culture Localization is essential Keyword / Copy complexities Technology - Doublebyte & API’s Unique Search Engines Local Players - Baidu, Naver, Yahoo Unique Ad Layouts & Structure Different approach to Natural Search Multi Channel Mobile Search Offline Search Integration Click to Call Video / Social Media content

Language & Culture

Localization is essential

Keyword / Copy complexities

Technology - Doublebyte & API’s

Unique Search Engines

Local Players - Baidu, Naver, Yahoo

Unique Ad Layouts & Structure

Different approach to Natural Search

Multi Channel

Mobile Search

Offline Search Integration

Click to Call

Video / Social Media content

Japanese Online Space….

The Japanese Online Advertising Market By 2011, Search will represent 36% of all web based online ad spending, with Mobile Search forecast to represent 40% of all mobile ad spending by 2011 Dentsu Ad Report, 2007 * I ncludes banner, text, rich media, streaming video, tie-up and e-mail ads; ** Includes image, text, tie-up, e-mail and (from 2007 onward) mobile search ads ¥ Billion

Search Marketing in Japan.. Japanese consumers are online: “ More than 70% of the population are internet users . Approximately 88.9 Million users…. ” “ There are more than 90 Million mobile internet users. (the largest in the world)…” — eMarketer, 2007 And use search engines: “ 92% of internet users use search engines to find information” “ 51% of mobile users, use search engines” - ComScore, 2007 “ 75% of the Japanese respondents said that if they could not find the company in the search results, their image toward that company would go down. — Japan Ministry of Affairs Report, 2007 And it works! “ SEO (32%) and SEM (25%) are considered the strongest drivers of traffic in Japan by Japanese marketers .” — Impress R&D Whitepaper, 2007 “ 32% of users that have seen a ‘keyword search ad on TV or a train, had actually used that keyword in a search ” — Goo Research, 2007 Search influences 20%-30% of all purchases made at retail locations.” — eMarketer 2007

The Japanese Engines Natural Search Listings Paid Search Listings Distribution Partners Distribution Partners

Japan – Comparative User Search Patterns On Yahoo users tend to read only the first 2-3 words of each search result and then just scan towards the bottom of the page Google Japan users tend to read more of the title and descriptions of the search results page when compared to Yahoo

On Yahoo users tend to read only the first 2-3 words of each search result and then just scan towards the bottom of the page

Google Japan users tend to read more of the title and descriptions of the search results page when compared to Yahoo

Mobile Search is growing fast Mobile internet users, exceed PC based Internet users in Japan, back in 2005. Previously Mobile traffic was largely driven & controlled by network directories (menu’s) which only accepted “official sites”. Mobile search has opened up ‘user access’ to all mobile content, sites and eCommerce. Small screens & fewer results are leading to much higher click through rates and responsiveness compared to web search. Searches tend to be much higher on the weekends & outside hours reflecting ‘mobile’ nature of use. Search is expected to constitute 40% of all mobile advertising by 2010.

Mobile internet users, exceed PC based Internet users in Japan, back in 2005.

Previously Mobile traffic was largely driven & controlled by network directories (menu’s) which only accepted “official sites”.

Mobile search has opened up ‘user access’ to all mobile content, sites and eCommerce.

Small screens & fewer results are leading to much higher click through rates and responsiveness compared to web search.

Searches tend to be much higher on the weekends & outside hours reflecting ‘mobile’ nature of use.

Search is expected to constitute 40% of all mobile advertising by 2010.

Mobile Search Engine Usage 81% have used Yahoo! Mobile with Google mobile second with 41.5%

In Japan - Search is “Cross Media” “It’s a button on your phone” “it’s a keyword on every ad!”

Japan Search Box & Keyword Integration The majority of both television & train advertisements in Japan have a keyword in a search box as the primary user action, often with no URL. A recent Goo Research Survey (Jan 2007) found that: More than 60% of consumers surveyed had seen a television advertisement that asked them to search for a key word? More than 32% of those that had seen the ad, had then actually used that keyword in a search.

The majority of both television & train advertisements in Japan have a keyword in a search box as the primary user action, often with no URL.

A recent Goo Research Survey (Jan 2007) found that:

More than 60% of consumers surveyed had seen a television advertisement that asked them to search for a key word?

More than 32% of those that had seen the ad, had then actually used that keyword in a search.

Korean Online Space….

The Korean Internet Environment Korea leads the world in proportional search spending and high end internet penetration Koreans are more online than anyone: “ More than 71% of the population are internet users . Approximately 34.8 Million users…. ” “ 44.5 million mobile subscribers in total, or a 90.7% penetration rate…” “ 85% Broadband penetration , the highest in the world”

Search Marketing in Korea.. A unique approach to search: “ Early search in Korea was restricted by the volume of Korean content online, so the engines created communities to develop content in answer to questions or searches.” “ Knowledge iN” – the user created / community information database for Naver, features more than 70 Million entries and has made Naver the dominant leader in search (70+%).” Each engine in Korea manages its own database of content, one of the reasons that Google (2%) has failed to penetrate the market Korean search result pages tend to be very long, scrolling aggregations of different kinds of content – ads, news, video, blogs etc. In order to try and compete, Google released Universal Search in early 2008.

A unique approach to search:

“ Early search in Korea was restricted by the volume of Korean content online, so the engines created communities to develop content in answer to questions or searches.”

“ Knowledge iN” – the user created / community information database for Naver, features more than 70 Million entries and has made Naver the dominant leader in search (70+%).”

Each engine in Korea manages its own database of content, one of the reasons that Google (2%) has failed to penetrate the market

Korean search result pages tend to be very long, scrolling aggregations of different kinds of content – ads, news, video, blogs etc.

In order to try and compete, Google released Universal Search in early 2008.

Main Korean Engine’s Distribution Partners Distribution Partners Overture Sponsored Links Power Links Pro Plus Dictionary Business Ads & Other Links Google Paid Listings Q & A Image Paid Listings News / Blogs / Video / Organic

Naver Search Result Structure Sponsored Links Power Links Pro Plus Biz Site Ads Dictionary Q & A Local Information Shopping Sites Books Video Prof Resources Music News Web Images

Chinese Online Space….

China Internet Environment Internet User Growth The proportion of Chinese internet users in proportion to the Asia n internet population (3.71 billion) is 34.4% The number of Chinese internet user s has increased more than 110% since 2002 In 2006 The proportion of internet users to population (1.3billion)is 10.4% More than 82% of Chinese internet users reference the internet to find new information. More than 66% of internet users use search engines. 2002 2003 2004 2005 2006 68,000,000 87,000,000 Internet User I ncreasing rate 72.8% 45,800,000 123,000,000 80% 60% 40% 20% 0% 48.5% 27.9% 18.4% 19.4% 103,000,000 2007 137,000,000

The proportion of Chinese internet users in proportion to the Asia n internet population (3.71 billion) is 34.4%

The number of Chinese internet user s has increased more than 110% since 2002

In 2006 The proportion of internet users to population (1.3billion)is 10.4%

More than 82% of Chinese internet users reference the internet to find new information.

More than 66% of internet users use search engines.

Engine use varies with Socio Demographics And Socio Economic Status (High end user* Market Share) Engine Preference varies by location By user Age Distribution * Aged 25+, 4 yr degree, Earn 3,000+ RMB / Mnth Search Engine Share Baidu Other Yahoo Google

The Chinese Engines Natural Search Listings Hot Space Distribution Partners Distribution Partners Exact Match Paid Listings Paid Search Listings Natural Search Listings Intelligent Match General Ads

China – Comparative User Search Patterns

About Sozon SEO at 32% of the share is the strongest driver of traffic in Japan - Impress Internet R & D Whitepaper 2007

Sozon in Brief Based in Ginza, Tokyo. Sozon employs 35+ experienced, multilingual professionals, uniquely focused on delivering seamless business results to our clients both domestically and globally. A search pioneer in Japan, Sozon has focused on combining global best practice in search and online marketing services & technology, with Japanese attention to detail, speed & responsiveness. Sozon has established, proven processes to help manage challenging communications, smooth project delivery and maximize both results and performance for our customers. Sozon both delivers solutions in-house and partners with ‘best of breed’ technology providers / agencies both in Japan and throughout the world. Giving us more flexibility in providing competitive advantage Philosophy & Services People Evolution Process & Results Technology & Partnerships F ounded in 2003, Sozon has evolved from a small Japanese SEO software company to a Search & Interactive Marketing agency offering customized solutions for the Japanese and Asian markets.

Corporate Structure Founded in 1996 First Affiliate Marketing Provider in Japan (1999) 230+ staff Tokyo Publicly Listed in July, 2006 Leading Affiliate Company in Japan 1,700 Advertiser / Ecommerce clients, 550,000+ media partners in Japan 600 Million+ advertisements a day 40% Internet reach in Japan Strategic & capital Yahoo! Japan Alliance Yahoo Japan investment in 2005 Numerous joint ventures Completed acquisition of Sozon Inc in 2005 as search marketing / agency holding. Corporate & Affiliate Network Founded in 2003 Pioneer of SEO in Japan Launched first SEO ranking tool for Japanese market (2004) 35 Staff, Tokyo Ownership VC Investment since 2004 VC Majority shareholding in 2005 Service Evolution Started SEO software provider Evolved SEO Consulting services in 2004 Providing PPC services since 2005 Providing Full Service online marketing agency services since 2006 VC consolidated all Search / Interactive Agency services in Sozon (End 2006) Search & Interactive Agency

Founded in 1996

First Affiliate Marketing Provider in Japan (1999)

230+ staff Tokyo

Publicly Listed in July, 2006

Leading Affiliate Company in Japan

1,700 Advertiser / Ecommerce clients,

550,000+ media partners in Japan

600 Million+ advertisements a day

40% Internet reach in Japan

Strategic & capital Yahoo! Japan Alliance

Yahoo Japan investment in 2005

Numerous joint ventures

Completed acquisition of Sozon Inc in 2005 as search marketing / agency holding.

Founded in 2003

Pioneer of SEO in Japan

Launched first SEO ranking tool for Japanese market (2004)

35 Staff, Tokyo

Ownership

VC Investment since 2004

VC Majority shareholding in 2005

Service Evolution

Started SEO software provider

Evolved SEO Consulting services in 2004

Providing PPC services since 2005

Providing Full Service online marketing agency services since 2006

VC consolidated all Search / Interactive Agency services in Sozon (End 2006)

Integrated Digital Marketing Services Analytics Log File Analysis / Reporting Click-stream Analysis Campaign Conversion Tracking Technology Integration Site Optimization Site Review Navigation & Usability Design Application Design Landing Page Optimization Online Advertising Digital Media Campaign Planning Media Planning / Buying Creative Design & Execution Mobile / Web 2.0 Promotions Search Engine Optimization (SEO) Site Analysis & Consulting Web Tuning Guide Site Optimization Website Ranking & Reporting Pay Per Click Advertising (PPC) Keyword Research / Buying Bid / Budget Management Program Optimization Copy Writing / Translation Affiliate Marketing Campaign Planning & Optimization Affiliate Program Management Detailed Reporting / Analysis

Our Optimization Process

Managing the Digital Marketing Environment Landing Pages Campaign Pages Web Analytics Web Analytics Pull Marketing Push Marketing RSS Marketing Email Marketing CGM Marketing Blogs SNS Viral Marketing Web Optimization SEO Usability LPO Your Digital Site Web / Mobile External Efforts Conversion Zone Marketing Database PPC / SEM Affiliate Marketing Media Buying Widgets / Apps

Search Tools & Technology Proprietary SEO Technologies Search Ranking Software for monitoring both you and your competitors rank for keywords in Japanese search engines. Advanced textual linking service to help increase site link popularity and improve rankings. Beta launch 2005. Introduced in 2003 SeoSpy was Japan’s first online SEO commercial ranking software for optimizing site rankings. Sozon also utilizes best of breed, bid management tools. These assist us to manage more sophisticated campaign optimization, bidding and CPA tracking requirements for our PPC Clients. PPC Bid Management Tools Search Centre, bid management product localized for the Japanese market, leveraging Omniture’s analytics strength. Allows for integrated CPA tracking, sophisticated reporting & search campaign management A Spider notification service. Tells you when search engine spiders visit your site and specific pages that you can designate. Sozon has developed its own proprietary software tools to assist with tracking, management , and optimization of client SEO programs. Some of our key tools are listed below. Bid Buddy – leading European bid management platform designed for agency orientated search marketing. Allows for sophisticated campaign & keyword management, CPA tracking, and optimization of paid search campaigns. Pay per conversation ‘blog marketing’ platform. Connects advertisers with bloggers who blog on a pay per posting basis

Sozon also utilizes best of breed, bid management tools. These assist us to manage more sophisticated campaign optimization, bidding and CPA tracking requirements for our PPC Clients.

Sozon has developed its own proprietary software tools to assist with tracking, management , and optimization of client SEO programs. Some of our key tools are listed below.

Analytics Tools & Experience We are an approved global agency for Omniture, authorized to distribute their products and train customers on flagship products SiteCatalyst and SearchCenter as well as other products We also utilize a variety of other analytics solutions and have implemented these tools for a range of clients Analytics Tools & Experience Other Tools & Experience As an interactive agency, we utilize a variety of tools to help capture, manage and implement push marketing programs for our clients or optimize site and marketing campaign performance eCRM Technology platform for capturing profile data, managing data, reporting and sending of email & mobile campaigns Landing Page optimization tool and technology to improve conversion of site and landing pages

We are an approved global agency for Omniture, authorized to distribute their products and train customers on flagship products SiteCatalyst and SearchCenter as well as other products

We also utilize a variety of other analytics solutions and have implemented these tools for a range of clients

As an interactive agency, we utilize a variety of tools to help capture, manage and implement push marketing programs for our clients or optimize site and marketing campaign performance

Regional Network & Partnerships Sozon is currently implementing search & online programs across more than 14 countries, with a primary focus on Japan. All work is centrally managed out of our Tokyo office from our multinational team, with the assistance of “in market” partnerships as need. = Active Campaigns Key Partners

Some of our Clients Some Key Customer Accounts under Management

www.sozon.com Digital Marketing Specialists