In this issue:
- In Our Opinion: How Can 2014 Top Last Year?
- Career Opportunities:
- CMO – Growth Markets
- CMO – Start-up Mobile Advertising/M-Commerce
- Managing Director, Social Media
- Articles:
- Mobile Goes Mainstream: Consumers Lead the Way– Gridley & Company LLC
In Our Opinion by Jeff Gundersen & Lola White
How Can 2014 Top Last Year?
I attended the 13th annual Gridley & Company conference in NYC last week to hear 60-75 CEOs across the Media, Ad Tech, Payments & Financial Technologies, and Marketing Services sectors talk about their company’s 2013 performance and future expectations in 2014 and beyond.
Incredible Performance of Equity Markets in 2013
Linda Gridley opened the conference by highlighting the incredible performance of equity markets in 2013…”the S&P 500 rose 29.6%, the largest annual jump in 16 years…and the Dow rose 26.5%, its largest gain in 18 years…despite macroeconomic and geopolitical headwinds.” As stocks rose steadily higher, P/E ratios grew from 14x to17x, fueled by $349B which poured into stock-based mutual funds and exchange funds, the highest annual inflow ever recorded. It’s clear investors have moved off the sidelines and back into equity investments. Not surprisingly, Gridley indicated “internet giants eBay, Amazon, Google and Facebook were up an average of 57.6% in 2013, outperforming the equity market as a whole.”
We see CEOs doing the same thing…moving off the sidelines into action to grow their businesses by investing in marketing, new product development, and opening new markets. I had lunch with Claude Gallello, a senior global business development leader at Willis (global insurance brokerage firm) and he indicated Willis has recently completed an expansion from 115 to 130 countries globally. We are seeing other companies including Abbott, AIG, Accenture, Apple, Lenovo, Mercer, MetLife, and Prudential plc investing in acquisitions and strategic hires in Growth Markets (Brazil, China, India, Middle East) to expand their businesses in these countries and other emerging economies.
2014 Expected To Be Even Bigger in Terms of Digital and Mobile Media
Many of the keynote panelists at the Gridley conference confirmed they expect 2014 to be even bigger and more transformative in terms of digital and mobile media, marketing, and e-commerce. Tony Uzan (Advisory Director at PwC) indicated “digital advertising (including mobile) is on pace to surpass broadcast advertising by 2018” (www.pwc.com/outlook). Martin Nisenholtz (Senior Advisor – NY times) predicted Google will become the #1 market capitalization company and voice recognition technology will enable us to “liberate ourselves from the screens.” Jim Moran (General Partner at North Bridge) predicted “2014 will be the year mobile commerce hits main street…and mobile payment companies will be big winners in the equity markets in 2015-16.” Moran also indicated he “sees a day when Google will be serving us ads in our dreams.”
While the overall outlook is positive, there are some storm clouds on the horizon. Many VC experts including Alan Patricof (Managing Director, Greycroft Partners) indicated there are too many start-up companies without profitable business plans and many will not be funded in 2014 and will perish. Brian O’Kelley (CEO, AppNexus) and a leader in the AdTech space predicted 2014 would see a lot of action in the AdTech space. “Companies need to exit, be bought, or raise capital…and it will be a busy year for the investment bankers.” O’Kelley also indicated he “sees a bubble and a lot of AdTech companies will hit a wall in ’14…especially those without revenue and/or profitability.”
Also, while digital advertising in all forms is expected to grow dramatically faster than all other media, most CEOs expect to see Google and Facebook (which transitioned itself quickly to a mobile company) dominating 80+% of this media category leaving all other competitors fighting over the scraps.
New Digital Economy vs. Old Line Media and Marketing Services
While attending 10-15 of the individual CEO/company presentations at Gridley, I was struck by the contrast between new digital economy CEOs/companies and old line media and marketing services CEOs/companies. Change is happening so quickly, and the pace of change is accelerating through mobile advertising and commerce, you can almost see the writing on the wall for many old world companies and industries that are vulnerable to game-changing innovations by an Amazon, Google or Facebook.
While the equity markets are unlikely to achieve last year’s growth rates in 2014, many companies (especially leaders like Apple, Amazon, Google, and Facebook) are expected to ride the wave of mobile/digital explosion to continue aggressive growth. In light of these prognostications, it should be an interesting year and we expect continued action in all areas related to digital and mobile marketing, media and commerce.
As always, we welcome your comments and input, so please write in and let us know your viewpoints.
Happy New Year!
Jeff and Lola
Career Opportunities
CMO – Growth Markets
CMO – Mobile Advertising/M-Commerce Start-up
Managing Director, Social Media
ARTICLES:
Mobile Goes Mainstream: Consumers Lead the Way — January 2014 – Gridley & Company LLC
Comprehensive Industry Overview – – – Key Trends and Investment Opportunities
Mobile Industry Overview_1.10.14
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