1. © 2016 Karthik Ethirajan, all rights reserved
Should SSP buy a DMP ?
Karthik Ethirajan
April 2016

2. © 2016 Karthik Ethirajan, all rights reserved
2
Agenda
3. Digital Ad Value Chain
4. DMP TAM
5. Data Use Cases
6. DMP One Platform
7. Platform Components
8. DMP Market
9. Competitive Landscape
10.Business Case
11.Summary Analysis
Industry
Product
Market
Strategy

3. © 2016 Karthik Ethirajan, all rights reserved
3
In this constantly evolving digital ad value chain, data
providers (DMP) cater to all players
Advertiser
Agency/
Trading Desk
DSP / Ad Network
SSP/
Exchange
Publisher
• Principal
buyer
• Creative
arm
• Brand
relationship
• Technology
arm / RTB
• Campaign
operations
• Creates a
marketplace
• Inventory
aggregator
• Ad server
• Programmatic
• Yield
optimization
• Inventory
owner
• Audience
$ $ $ $
$5 $0.5 $1 $1 $0.5 $2.25
100% 10% 20% 20% 10% 45%
Function
CPM
Value
Industry
Players
DMP
• Provides buy and sell
sides with data & insights
• $0.50-$2 CPM
• 15% CPM
Source: GCA Savvian
Demand/Buy Side Supply/Sell Side

4. © 2016 Karthik Ethirajan, all rights reserved
Mobile DMP market will nearly double in size from 2015-17
4
$531B $582B
2015 2017
Global Ad
Spend
U.S. Ad Spend
DMP
TAM
Mobile
Ad Spend
34% 34%
$30B $50B
$58B $75B
$183B $197B
$1.3B* $2B*
CAGR
4.7%
3.8%
14%
29%
32% 38%
52% 67%
Global Ad Spend by Medium
Search
45%
Programmatic
59%
RTB
37%
U.S. Digital Ad Market
15% 15%
24%
Future Trend
($67B in 2016)
Source: Zenith Optimedia, eMarketer, BI, Karthik analysis
Digital Ad
Spend
* DMP TAM assume 50% of all display & video ads use
data for targeting
Search
44%
Display
20%
Desktop
$25B
Mobile
$42B
Video
24%
Display
43%
Video
10%

5. © 2016 Karthik Ethirajan, all rights reserved
5
Application of Big Data in advertising & adjacent markets
Market
Facing
Use Case
Analytics / Refined Data
Raw Data
Value
Volume
Examples
• Reg Data
• Lat/long
• Browse History
Providers
• Ad-tech
• Publishers
• Carrier
Providers
• Data Analytics
Examples
• Behavioral Profile
• Look-alike Model
Providers
• Ad-tech
• Market
Research
Firms
Examples
• Targeting
• Attribution
• Ad Optimization
• Insights
Targeting
Location based
user profiles
User Lat/Long
POI Map
+
Attribution
Conversion &
lift analysis
Offline / POS
+
Ad Optimization
Yield Optimizer
User Clicks
+
Market Insights*
Location tech &
heat maps
Demographics
+
Campaign Data Site Categorization Network Lat/Long
* Market Insights reports are used by many industry verticals such as financial
services, healthcare, hospitality and others for purposes unrelated to advertising

6. © 2016 Karthik Ethirajan, all rights reserved
End-to-end platform that links data source with ad
serving
6
Data file
Ad Request
Data file
1st Party
Data
SSP
Data
3rd Party
Data
Pubs
Data
Coop
Data
LogicalCombinations
Premium
Pubs
Data file
Ad Request
Custom
• Songs
played
• TV shows
• Contract
up
• Others
Standard
• Age
• Gender
• IAB
category
• Others
Data Dictionary
• Link to
campaigns
• Generate
reports
Campaign
Execution
Collection
Methods
Data
Sources
DMP Analytics
Audience
Segments
Publishers decide which data fields to share (Coop data) and which
ones to keep (Pubs data) for their own campaigns
Audience Pixel
Branded
Data
Standard
• Branded
audience
segments
SSP/
Exchange

7. © 2016 Karthik Ethirajan, all rights reserved
7
Portal
An easy to use self-
service Audience Builder
• Layer different data
types to form custom
segments
• Show avails
• Link to live campaign
• Pull reports
SDK/APIs
Client SDK & server-side
APIs
• Capture user & device
data
• Enrich ad request
client-side
• Implement real-time
ad decisioning such as
geo-fences
Data
Onboarding
Support variety of data
collection methods
• Offline ingestion
• Ad request parameters
• On-demand data
upload
• Audience pixel
Enable data matching
using PII, device ID,
cookies & other match
keys
Data Taxonomy
Define and organize all
targetable data in a data
dictionary
• Demographics
• Behavioral
• Location
• Devices
• Apps
• Clicks & conversions
Data Science
Data analytics capabilities
• Supplement
reported/reg data with
derived data to help
boost scale
• Look-alike modeling
• Data normalization
• Device fingerprinting
• Attribution report
• Lift analysis
Integrated
Platform
Seamless end-to-end
platform with an
integrated DMP & ad
server
• No data leakage
• Yield optimization
Key components of an ad-tech DMP

8. © 2016 Karthik Ethirajan, all rights reserved
DMP players can be classified by many dimensions.
Successful players are able to offer differentiated
services across multiple dimensions.
8
DMP + VAS
VAS such as ad
serving, reporting
Pure Play DMP
Standalone DMP
Many Pubs
Premium &
diversified
Single Pub
Large but walled
garden
Mobile
Cookieless tracking
Online
Desktop legacy
Mainstream
Analytics
Combination such as
location, user agent,
sub-ID, app verify, etc.
Niche
Analytics
e.g., Location,
Census, Credit
agency
Success Factors
Ad-Tech DMP

9. © 2016 Karthik Ethirajan, all rights reserved
Relative strengths of DMPs in enabling ad-tech compared
to industry behemoths
9
Feature Walled Garden Location DMPs Online / Legacy
Integrated platform
No data leakage
O&O inventory
Premium & diversified
Mobile expertise
Cookieless, deterministic
Toolkits
Data layering, avails calculator, etc.
Data analytics
POI graph, modeling, inferred data
Cross screen
Mobile, tablet, online
Attribution
Offline / online
Data onboarding
Device ID, PII, cookie matching
SDK / APIs
Client-side, server-side enrichment

10. © 2016 Karthik Ethirajan, all rights reserved
Buying is better if DMP platform can be integrated fast
and its data usage ramped up rapidly in campaigns
Impressions
Data CPM
$1 $2
Demographics Behavioral /
Location
Custom
0%
5%
10%
15%
20%
25%
30%
35%
0 20 40 60 80 100 120
Months before breakeven
DataUsage
~1 year BE
period if data
usage >5%
Partner Data Cost
Buy Breakeven Analysis
10
Breakeven Analysis
Buy DMP for $150M
Average market value of 3rd party data is $1.50
CPM
M&A cost in impressions: $150M / $1.50 CPM
Equivalent of 100B impressions
SSP traffic is about 100B per month
BE point (in months) is SSP traffic / portion of
SSP traffic that utilizes DMP data
BusinessCaseGrowthStrategy
Buy
DMP sales $50-100M
DMP valued at 2-3x sales multiple
M&A cost will be between $100-200M
Build
DMP team of 10 at $200K for a year
Build cost will be $2M
Partner
DMP data cost is $0.50 - $2 CPM
Equivalent of 20-30% top line revenue

11. © 2016 Karthik Ethirajan, all rights reserved
Strategic considerations of buying a DMP
11
Pros Cons
Synergy
Strong tech play including toolkits,
location, analytics, etc. Strength in
mobile
DMP tech not related to ad-tech
Integration
Data collection from offline and real-
time data sources
DMP still needs to be integrated with
SSP platform components
Scale Many DMPs do not “own” data
Tech may be available but user data
may need to be built from scratch
Business Model
DMP data available for consumption on
the SSP platform
May need to deprecate “selling” data for
consumption outside platform
Business Case
Better targeting commands higher CPM.
SSP gets to keep all of incremental
revenue.
Data centers incur Opex
Brand
Source new campaigns by marketing
DMP brand
Advertiser may ask for data from a
different DMP requiring us to still
partner with other data providers
StrategicConsiderations
Recommendation
Buying a DMP will speed time to market by providing the
needed tech. However, SSP will still need to partner with
other data providers to satisfy customer interest