Q3 2013 presentation by GGV Capital on trends in social media with a focus on content, mobile and geography. For more, follow GGV on Twitter @ggvccapital.

1. The Social Media Landscape:
Segments, Trends and Market Size
September 2013

2. Sections
• Social Media & Advertising
• Social Media Management
• Mobile Advertising
• Content Creation & Publishing
2

3. Social Media & Advertising

4. Social Media Continues to Grow Globally
Social Media Penetration by Destination
Social Media Population by Destination
Facebook
1,100M
Twitter
500M
Google+
500M
Qzone
480M
Sina
300M
Habbo
268M
LinkedIn
200M
Renren
160M
Vkontakte
123M
Tagged
100M
0M
250M
500M
750M
1,000M 1,250M
Source: Gartner, September 2013
4

5. Global Usage of Social Networking Continues to Increase
Global social network usage continues to rise
Worldwide social network penetration is forecast to reach 35% by 2017, up from 24% in
2013

6. Social Networking Gaining Share of Time Online
Social networking is forecast to comprise nearly 30% of all time spent online and on
smartphones in 2013, up from 18% for online and 10% for mobile in 2010

7. In Other Words, It’s Not Just About Facebook
Most brands are simultaneously using multiple social platforms to reach their customers
7

8. Brands are Increasingly Promoting Content…
8

9. And Consumers Want Brand Engagement on Social Media
9

10. Social Networks Playing an Increasing Role in E-Commerce
Source: Vocus & Gartner, November 2012
10
Source: Monetate, May 2013

11. Advertisers Use a Variety of Social Media Strategies
11

12. Sponsored / Branded Content
CPM rates are diving
– Due to shift to mobile + RTB/DSPs
Sponsored content is the fastest growing and most lucrative “ad unit” for publishers
– Flipboard, Buzzfeed, Mashable, Business Insider others all over it; major publishers starting to
take notice
The challenge for brands
– Sponsored content across media properties looks somewhat
similar to traditional content/advertising model
– Branded content across social media does not
– Enormous value in “real time” and capturing the moment
– See: Oreo at the Super Bowl
– Younger demographic (<25) thrives on “real time”
• Spends more time on Instagram, FB, Twitter, Pinterest
• And less time on News, TV, etc.
12

13. Sponsored Content – Incredibly Effective When Done Right
Simple, effective and actually appreciated by consumers
As a result, highly viral and shared
13

14. A Well-Designed, “In-Stream” Experience “Ad Unit”
14

15. Leads to a Consistent User Experience (Not a Landing Page)
15

16. American Express and Other Brands Focusing on Twitter
16

17. Leading to a Great (and Highly Engaging) User Experience
17

18. Social Media Management

19. Marketers Increasing Spend on Social Media Management
19

20. Recent M&A Activity in Social Media Marketing & Management
July 2012
$350M Acquisition
+ $100M Potential Earnout
June 2012
May 2012
$689M Acquisition
$325M Acquisition
Undisclosed
May 2012
May 2012
$152M Acquisition
$150M Acquisition
September 2011
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21. Social Collaboration is a Related Trend
Enterprise social networking and collaboration vendors complement social media
strategies by familiarizing employees with managing diverse, distributed communication
channels
Customer service is increasingly a facet of social media marketing, with customer
satisfaction ratings becoming increasingly public and easy to find
Enterprise social networking, collaboration an/d
project organization software; acquired by
Microsoft for $1.2B
Social collaboration, offering suites for employee
social networking, customer service, sales,
marketing and government communication; now
public with market cap of $871M
Customer support software with broad social media
integration
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22. Social CRM is a Natural Extension of Social Networking
Opportunities for Social CRM
Source: Gartner, May 2013

23. Mobile Advertising

24. Mobile Ad Revenue is Poised for Strong Growth
Total mobile advertising revenue is forecast to exceed $24B by 2016
Mobile web display, in-app display and mobile search will dominate revenue share
$30,000
$24.5B
$25,000
$20,000
$15,000
$10,000
$5,000
$0.8B
$0
2009
2010
Mobile Web Display
Source: Gartner, November 2012
24
2011
2012
In-App Display
2013
Search/Maps
2014
2015
Audio/Video
2016
SMS/MMS/IM

25. Smartphone Penetration Increasing Globally
Highest growth regions for smartphone adoption are the Middle East and Africa, Latin
America and Central and Eastern Europe
70%
60%
50%
40%
30%
20%
10%
0%
2012
2013
US
Middle East and Africa
Region
US
Canada
Western Europe
Central and Eastern Europe
Asia Pacific
Middle East and Africa
Latin America
Worldwide
Source: eMarketer, May 2013
25
2014
Western Europe
Latin America
2012
38.7%
30.6%
30.2%
21.0%
15.6%
5.1%
13.1%
15.7%
2015
2016
Central and Eastern Europe
Worldwide
2013
44.3%
35.1%
38.7%
29.3%
18.7%
8.3%
18.6%
19.8%
% of Population
2014
2015
50.1%
55.4%
40.2%
43.6%
47.4%
55.6%
39.1%
46.6%
22.9%
25.9%
10.9%
13.0%
23.6%
29.2%
24.3%
28.0%
2017
Asia Pacific
2016
59.8%
46.6%
61.3%
53.6%
28.5%
15.0%
34.0%
31.2%
2017
63.5%
49.8%
65.8%
59.5%
31.0%
16.8%
38.8%
34.0%
CAGR
10.4%
10.2%
16.9%
23.2%
14.7%
26.9%
24.3%
16.7%

26. Mobile Content is Gaining Ad Revenue Share
“Non-traditional” advertising platforms are
gaining share, especially on mobile
– Facebook
– Pandora
– Twitter
We believe Google will retain a dominant
position in mobile due to search, click to call
and maps
– And mobile’s share of Google’s ad
revenue is forecast to dramatically
increase
Traditional publishers likely to lose
significant share to new entrants
– FB, Pandora, Twitter
– New players like Yelp, Trulia, Houzz,
Flipboard
Mobile will not reflect a simple “transition” of
traditional display market to mobile
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27. Behavior on Mobile is Vastly Different From Desktop
Note that “Reading News” or “Work Applications” don’t show more than 5% of user
timeshare (“News” is likely encompassed in “Browser” in chart below)
27

28. Social Media Ad Revenue is Increasingly Mobile-Centric
Mobile ad revenues for Facebook and Twitter will comprise over 50% of total ad
revenues in 2014, up from 0% in 2011
28

29. Mobile Monetization – Not Your Father’s IAB Standard Ad Unit
Ad Units / Monetization
The best mobile advertising experiences are appearing as “native,” and blended into
the user experience in a way that the user perceives value in the ad unit (versus an
annoying unit he/she must click through to get to content)
29

30. Content Creation & Publishing

31. Market for Digital Content Creation Software is Growing
Digital Content Creation Software Market Size: SaaS & Non-SaaS
Source: Gartner, October 2012
31

32. Content Creation is a Major Part of Marketing Budgets
32

33. Social Marketing Teams Are Focused on Content Creation…
Source: Gartner, March 2013
33

34. …Which is Driving Demand for Content Creation Outsourcing
Source: Gartner, March 2013
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35. The Social Media Landscape:
Segments, Trends and Market Size
Jeff Richards / jrichards@ggvc.com
Crystal Huang / chuang@ggvc.com