Perspectives on the Internet, the Economy, and Social Media Jordan Rohan Clearmeadow Partners Presentation to DPAC May 12 ...
Introduction <ul><li>Clearmeadow Partners , is a digital media advisory firm  </li></ul><ul><ul><li>Firm’s mission: to hel...
Agenda <ul><li>Review of Macro Trends </li></ul><ul><li>The Economy’s Impact on Online Commerce and Advertising – Google, ...
S&P 500 Up 32% from March Bottom…. but still down 35% since SIS 2008 DPAC Conference Internets S&P 500 A rally of 57% requ...
Negatives: Corporate Debt Spreads Remain Massively Wide DPAC Conference Spreads Have Eased, but Remain Highly Elevated DPA...
Public Markets Have Re-Valued Internet DPAC Conference
Decelerating 1Q Growth Rates DPAC Conference -3,634 bp -1,891 bp - 2,878 bp -3,178 bp
Google – Decelerating Growth Rates DPAC Conference Rest of World U.S. U.K. 1Q08 2Q08 3Q08 4Q08 1Q09 United States 29% 27% ...
Google <ul><li>Search:   “Users are still searching but they’re buying less. Ultimately, what that really means is that th...
Yahoo! <ul><li>Search:  </li></ul><ul><li>…“ search volume was up 11% worldwide… people are spending time online … searchi...
Social Media Continues to Grow ….while portals decline… DPAC Conference
Social Media is Fantastic Consumer Application DPAC Conference … but only marginally profitable… Source: Comscore, Clearme...
Twitter – Extraordinary Growth in Audience DPAC Conference 17x Growth in Past Year
Twitter is…. <ul><li>A notable advancement in communication... </li></ul><ul><li>that plays to the desire among some to co...
Twitter is NOT…. <ul><li>A massive multi-billion dollar Internet ecosystem… </li></ul><ul><li>Instant messaging was a brea...
Retention Rates – Twitter is only 40% DPAC Conference Source: Nielsen MySpace Facebook Twitter Twitter Retention Rate of ~...
Internet Reach and Retention Levels DPAC Conference High Retention Rates Required for Mass Audience Source: Nielsen
Trends in social platforms DPAC Conference Source: Google Trends
More Info <ul><li>[email_address] </li></ul>DPAC Conference Presentation will be available at www.clearmeadow.com
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How To Survive And Thrive

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How To Survive And Thrive

  1. 1. Perspectives on the Internet, the Economy, and Social Media Jordan Rohan Clearmeadow Partners Presentation to DPAC May 12 th , 2009 DPAC Conference
  2. 2. Introduction <ul><li>Clearmeadow Partners , is a digital media advisory firm </li></ul><ul><ul><li>Firm’s mission: to help companies of all sizes accelerate growth in digital revenue </li></ul></ul><ul><ul><li>Profitable companies with defensible market positions </li></ul></ul><ul><ul><li>Advisory services, capital raising, and business development services </li></ul></ul><ul><li>Want to chat? [email_address] </li></ul>DPAC Conference
  3. 3. Agenda <ul><li>Review of Macro Trends </li></ul><ul><li>The Economy’s Impact on Online Commerce and Advertising – Google, Yahoo!, eBay and Amazon </li></ul><ul><li>Slow Decline of Portals </li></ul><ul><li>Twitter </li></ul>DPAC Conference
  4. 4. S&P 500 Up 32% from March Bottom…. but still down 35% since SIS 2008 DPAC Conference Internets S&P 500 A rally of 57% required to get back to even!
  5. 5. Negatives: Corporate Debt Spreads Remain Massively Wide DPAC Conference Spreads Have Eased, but Remain Highly Elevated DPAC Fall ‘08 1.5 Years Ago DPAC Summer ‘08
  6. 6. Public Markets Have Re-Valued Internet DPAC Conference
  7. 7. Decelerating 1Q Growth Rates DPAC Conference -3,634 bp -1,891 bp - 2,878 bp -3,178 bp
  8. 8. Google – Decelerating Growth Rates DPAC Conference Rest of World U.S. U.K. 1Q08 2Q08 3Q08 4Q08 1Q09 United States 29% 27% 22% 13% 4% United Kingdom 39% 29% 17% -1% -9% Rest of World 64% 61% 52% 34% 16%
  9. 9. Google <ul><li>Search: “Users are still searching but they’re buying less. Ultimately, what that really means is that the ads are converting less. More window and comparison shopping, purchasing lower priced goods” </li></ul><ul><li>Display: “.. branding oriented display campaigns remain challenging in Q1 as our advertisers slowed their spend relative to the performance-based advertising” </li></ul><ul><li>Global Regions: “…EMEA is beginning to experience the slowdown seen in other countries. Ireland and Spain were clearly weaker while Germany was a relative bright spot….Outside the U.S. and Europe, China and Brazil performed reasonably well…” </li></ul>DPAC Conference
  10. 10. Yahoo! <ul><li>Search: </li></ul><ul><li>…“ search volume was up 11% worldwide… people are spending time online … searching for a job not for a hotel room in Las Vegas.” </li></ul><ul><li>“ double digit growth in volume but revenue per search (RPS) down significantly” </li></ul><ul><li>“ It’s like online window shopping” </li></ul><ul><li>Display: …“class 2 (non-guaranteed display advertising) revenues are growing double the rate of class 1 (guaranteed display advertising) revenues because of the economy” </li></ul><ul><li>Organizational Inefficiencies: “We had one product management person for every three engineers… too many people running around [expletive] telling engineers what to do” – Carol Bartz </li></ul>DPAC Conference
  11. 11. Social Media Continues to Grow ….while portals decline… DPAC Conference
  12. 12. Social Media is Fantastic Consumer Application DPAC Conference … but only marginally profitable… Source: Comscore, Clearmeadow
  13. 13. Twitter – Extraordinary Growth in Audience DPAC Conference 17x Growth in Past Year
  14. 14. Twitter is…. <ul><li>A notable advancement in communication... </li></ul><ul><li>that plays to the desire among some to communicate constantly </li></ul><ul><li>driven by higher usage of mobile messaging and smart phones </li></ul><ul><li>that can help to reinforce a public image </li></ul><ul><li>especially for celebrities that need the incremental exposure the least (Oprah, Ashton,...) </li></ul><ul><li>with the potential to destroy/cannibalize content sites and traditional media: </li></ul><ul><li>existing broadcast and publishing business models may suffer as Twitter’s minute-by-minute updates from journalists reduces appointment viewing online and broadcast forms </li></ul><ul><li>If you already know what will be in the local sports section in tomorrow's paper…..why pay for the subscription? Why go to the website? </li></ul>DPAC Conference
  15. 15. Twitter is NOT…. <ul><li>A massive multi-billion dollar Internet ecosystem… </li></ul><ul><li>Instant messaging was a breakthrough for ICQ (Israeli company sold to AOL). Technology made very little for anyone but the founders and venture capitalists.  </li></ul><ul><li>Marketers never figured out how to commercialize IM broadly. Twitter seems similar. </li></ul><ul><li>Nor is it a particularly compelling format for search: </li></ul><ul><li>User/audience is not looking to transact or to respond </li></ul><ul><li>Unclear how compelling the format will be for brand advertisers </li></ul><ul><li>Not impervious to competition from Microsoft or Google </li></ul><ul><li>Unless one of those companies acquires Twitter first   </li></ul>DPAC Conference
  16. 16. Retention Rates – Twitter is only 40% DPAC Conference Source: Nielsen MySpace Facebook Twitter Twitter Retention Rate of ~40% is Low, Relative to other Social Media
  17. 17. Internet Reach and Retention Levels DPAC Conference High Retention Rates Required for Mass Audience Source: Nielsen
  18. 18. Trends in social platforms DPAC Conference Source: Google Trends
  19. 19. More Info <ul><li>[email_address] </li></ul>DPAC Conference Presentation will be available at www.clearmeadow.com

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