Measuring The Total Economic Impact Of Rocket Fuel

Transcription

1 A Forrester Total Economic Impact Study Prepared For Rocket Fuel A Financial Impact Analysis For Advertisers And Interactive Media Agencies Project Director: Jon Erickson March 2013

2 TABLE OF CONTENTS Executive Summary... 2 Rocket Fuel Drives Improved Campaign ROI For Programmatic Media Buys... 2 Factors Affecting Benefits And Costs... 3 Disclosures... 4 TEI Framework And Methodology... 5 Analysis... 6 Costs... 9 Measurement Of Campaign Impact... 9 ROI Analysis ---- Agency ROI Analysis ---- Advertiser Financial Summary Appendix A: ROI Campaign Assumptions About Rocket Fuel Appendix B: Total Economic Impact Overview Appendix C: Glossary , Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester, Technographics, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. For additional information, go to About Forrester Consulting Forrester Consulting provides independent and objective research-based consulting to help leaders succeed in their organizations. Ranging in scope from a short strategy session to custom projects, Forrester s Consulting services connect you directly with research analysts who apply expert insight to your specific business challenges. For more information, visit Page 1

3 Executive Summary In 2012, Rocket Fuel commissioned Forrester Consulting to examine the total economic impact and potential return on investment (ROI) agencies and advertisers may realize by leveraging its programmatic media buying technology for developing, managing, and optimizing their media spend. The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of using Rocket Fuel as part of their digital media buying strategy. Rocket Fuel Drives Improved Campaign ROI For Programmatic Media Buys Our interviews with seven existing agencies and advertisers and subsequent financial analysis found that the representative organization based on the agency and advertiser organizations we interviewed experienced the riskadjusted ROI impact shown in Table 1. Table 1 Agency And Advertiser Representative Organization: ROI Campaign Impact Across Selected Campaigns Average campaign length Interactive media agency Advertiser 30 days 133% 60 days 154% 90 days 122% 88% Three-year campaign impact 229% 192% Benefits. The representative agencies and advertisers we interviewed experienced the following benefits that are used as the basis for the analysis: o o Improved campaign efficiency. Improved campaign effectiveness. Costs. Organizations noted a cost premium using Rocket Fuel, compared with other ad buying alternatives, but those costs were more than offset by improved ROI: o Increased CPM. One of the key benefits of the surveyed organizations was seen over time as they used Rocket Fuel over multiple campaigns. For these organizations, the result was a shift in the media buying patterns away from ad networks and demand-side platforms (DSPs) that used less automation and sophisticated algorithms in their campaigns toward Page 2

4 Rocket Fuel. This resulted in a higher overall media buy efficiency shown over time for both agency and advertiser clients. Figure 1 illustrates the shift in ROI over a three-year time frame away from other media buy alternatives to Rocket Fuel resulting in higher growth in campaign ROI. The resulting ROI three-year impact for campaigns incorporating Rocket Fuel into the media buy mix equates to a 229% ROI for agencies and a 192% ROI for advertisers. Figure 1 Impact Of Rocket Fuel On Average Campaign ROI Agency And Advertiser Growth in average campaign ROI: three-year analysis for the agency Rocket Fuel Alternative - Medium Alternative- Low Y1 Y2 Y3 Growth in average campaign ROI: three-year analysis for the advertiser Rocket Fuel Alternative - Medium Alternative - Low Y1 Y2 Y3 Factors Affecting Benefits And Costs Table 1 illustrates the risk-adjusted financial results that were achieved by representative agencies and advertisers. The risk-adjusted values take into account any potential uncertainty or variance that exists in estimating the costs and benefits, which produces more conservative estimates. The following factors may affect the financial results that an organization may experience: Page 3

5 Type and outcome of campaigns run. While all organizations saw growth in the share of spend attributed to Rocket Fuel, the growth of that shift was determined in part by the types of campaigns that are being run. Rocket Fuel had the most success with campaigns that seek very specific types of prospects, compared with broad campaigns where the number of potential targets was much wider and the time to reach those targets was greater. Strength of Rocket Fuel algorithms. All of the organizations noted that one of the benefits of Rocket Fuel was the ability to make changes quickly to campaigns and the underlying targeting and optimization algorithms. Disclosures The reader should be aware of the following: The study is commissioned by Rocket Fuel and delivered by the Forrester Consulting group. Forrester makes no assumptions as to the potential ROI that other organizations will receive. Forrester strongly advises that readers should use their own estimates within the framework provided in the report to determine the appropriateness of an investment in Rocket Fuel. Rocket Fuel reviewed and provided feedback to Forrester, but Forrester maintains editorial control over the study and its findings and does not accept changes to the study that contradict Forrester s findings or obscure the meaning of the study. The customer names for the interviews were provided by Rocket Fuel. Page 4

6 TEI Framework And Methodology Introduction From the information provided in the interviews, Forrester has constructed a Total Economic Impact framework for those organizations considering implementing Rocket Fuel. The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment decision. Approach And Methodology Forrester took a multistep approach to evaluate the impact that Rocket Fuel can have on an organization (see Figure 2). Specifically, we: Interviewed Rocket Fuel marketing/sales/consultants personnel and Forrester analysts to gather data relative to Rocket Fuel and the marketplace for Rocket Fuel. Interviewed seven organizations currently using Rocket Fuel to obtain data with respect to costs, benefits, and risks. Designed a composite organization, an advertiser and agency, based on characteristics of the interviewed organizations (see Appendix A). Constructed a financial model representative of the interviews using the TEI methodology. The financial model is populated with the cost and benefit data obtained from the interviews as applied to the composite organizations. Figure 2 TEI Approach Perform due diligence Conduct customer interviews Design composite organization Construct financial model using TEI framework Write case study Forrester employed four fundamental elements of TEI in modeling Rocket Fuel s service: 1. Costs. 2. Benefits to the entire organization. 3. Flexibility. 4. Risk. Page 5

7 Given the increasing sophistication that enterprises have regarding ROI analyses related to IT investments, Forrester s TEI methodology serves the purpose of providing a complete picture of the total economic impact of purchase decisions. Please see Appendix B for additional information on the TEI methodology. Analysis Interview Highlights Rocket Fuel allowed us to broaden our portfolio of media buy options, providing greater speed and results to meet our KPIs for specific campaigns. (Media planner, interactive marketing agency) A total of seven interviews were conducted for this study, involving representatives from the following companies (Rocket Fuel customers based in the US): 1. A Fortune 100 provider of financial services and investment products using Rocket Fuel as part of both customer acquisition and brand awareness campaigns within North America. 2. A retail sports products manufacturer supplying markets across the globe with running shoes, apparel, and accessories. Rocket Fuel was used as part of display marketing campaigns aimed primarily at brand awareness. 3. A full-service provider of interactive marketing solutions to Fortune 500 companies in New York City using Rocket Fuel as part of selected campaigns for luxury business-to-consumer (B2C) targeting within display. 4. Levelwing, ( an agency providing business analytics and intelligence solutions as well as mining and analyzing of data to Fortune 1000 clients within North America. Campaigns are run across display, social media, and mobile. 5. Booyah!, ( a full-service digital ad agency providing paid search, display media, social media, SEO, and creative services. Rocket Fuel was used for specific geographic and demographic targeted campaigns. 6. A large independent agency based in the western US providing services in advertising, online marketing, web development, data analytics, integrated communications planning, brand identity, design, and strategic brand consulting. 7. A full-service agency providing a variety of interactive media services to clients in a broad range of categories, including retail, packaged goods, healthcare, financial services, consumer durables, and technology. The seven interviews uncovered several key points that drove our analysis around the impact to advertiser and agency organizations: Page 6

8 History with Rocket Fuel. The length of time the agency and advertiser clients were using Rocket Fuel varied from nine months to more than two years. All of the organizations were using Rocket Fuel as part of display campaigns, including video display, but several were in the process of considering application of Rocket Fuel to social media and mobile-driven campaigns. All organizations saw growth in their media spend with Rocket Fuel. For agencies, it was an increased share of their clients media buy, and for advertisers, it was an increase in overall spend. Role of Rocket Fuel in overall media buy strategy. Organizations saw Rocket Fuel as a way of increasing their diversity around their media buy. Before investing in Rocket Fuel, organizations were using a mixture of traditional ad networks or limited use of DSPs. Rocket Fuel provided a chance to increase the amount of automated real-time bidding (RTB) and sophistication of targeting and optimization algorithms. Organizations began their investment with a single campaign and expanded to include Rocket Fuel across campaigns and, in the case of the agencies, across multiple clients and geographies. Rocket Fuel differentiators. In looking across how agencies and advertisers saw Rocket Fuel, compared with other media buying partners, the majority of interviewed clients saw it as augmenting as opposed to replacing their current media buy technologies. Organizations saw the use of Rocket Fuel as a way to increase the reach and depth of targeted campaigns, coupled with the growth in overall media spend. Key impacts of Rocket Fuel. Rocket Fuel provided organizations with a way to increase the reach of individual campaigns through more sophisticated algorithms leading to greater conversion and higher levels of automation, thereby leading to improved speed. Both of these have the effect of more effective campaigns leading to higher campaign ROI. While organizations noted that the campaigns that ran with Rocket Fuel did produce higher ROI than alternative campaigns, these campaigns were targeted to a specific audience and reach in a limited campaign time frame. All organizations were using a wide portfolio of platforms and ad networks. The success of Rocket Fuel was in part due to the type of campaign. Other campaigns with more general criteria yielded a similar ROI at a lower cost premium, compared with Rocket Fuel. While Rocket Fuel provided reporting capability to its clients, few of the interviewed organizations took advantage of this capability. Most of the agencies had their own client reporting platform and aggregated the results from Rocket Fuel into the current reporting process. Framework Assumptions This analysis is based on campaign-specific data around the use of Rocket Fuel, compared with other specific media buy alternatives within their portfolio. Alternatives were generally grouped into two separate categories depending on the level of program automation around RTB and the sophistication of the campaign algorithms. Alternatives are classified as either low or medium targeting. Table 2 provides a comparison of the two alternatives Rocket Fuel clients faced in choosing how to spend their campaign media buy. Page 7

9 Table 2 Model Assumptions Low: alternative A, ad network (limited automation/optimization) Medium: alternative B, advanced targeting company Rocket Fuel: autonomous programmatic buying platform Optimization method Primarily manual optimization of campaigns leading to longer time to receive and update changes/requests Mix of automated and manual optimization of algorithms Fully automated, autonomously learning optimization models; manual optimization limited to exception management Algorithm complexity Typically algorithms per campaign that do not change across decisioning parameters (e.g., creative size, format, geography, audience) Several limited algorithms per campaign Customized adaptive algorithm for each campaign, created automatically from campaign optimization objective Algorithm update frequency Algorithms updated at point of origination Algorithms updated manually Algorithms updated automatically and in near-real time (every minute) Recency and frequency controls No frequency and recency controls available to client Limited frequency and recency controls available to client Full frequency and recency controls available to client Optimization capabilities No ability to simultaneously optimize to multiple success events No ability to simultaneously optimize to multiple success events Can simultaneously optimize to multiple success events with custom weighting of importance to client Advertising inventory purchase source Inventory purchased via direct publisher relationships Inventory purchased via RTB Inventory purchased via RTB The financial analysis focuses on the impact of Rocket Fuel from two separate perspectives: Impact of Rocket Fuel on the ROI-specific campaigns. Impact of Rocket Fuel on the ROI, compared with other media buy alternatives. As part of the analysis, Forrester will examine the impact for both agencies and advertisers within a single-year analysis as well as over a three-year period, factoring in the shift of spend toward Rocket Fuel. Page 8

10 The characteristics of the client organizations reflect the agency and advertiser clients surveyed. The following general assumptions were used as part of the analysis: Agency. The following were agency characteristics: o o o o o This is a US-based advertising agency. Client campaigns cross display (traditional and video), social media, and mobile. Total average client campaign spend is $2 million per year, increasing by 5% to 10% per year. Campaigns are run on a 30-day, 60-day, or 90-day schedule. Campaigns mix both brand awareness and customer acquisition. Advertiser. The following were advertiser characteristics: o o o This US-based organization sells a mix of B2C products and services. Campaigns are run on a 30-day, 60-day, or 90-day schedule across a portfolio of products. Campaign objectives include both targeted client acquisition as well as overall brand awareness with the primary emphasis on brand awareness. Costs One component of the Rocket Fuel impact analysis is to examine the potential investment costs of engaging with Rocket Fuel. The cost of Rocket Fuel is based on a negotiated CPM within the campaign, which is similar to alternate media buy channels. Organizations noted that Rocket Fuel tended to charge a CPM premium price, compared with other media buy alternatives, typically averaging 20% higher than lower-cost alternatives. This cost premium was typically balanced out by the improvements to campaign ROIs that were realized by the interviewed organizations. Measurement Of Campaign Impact This next section examines the effect of a higher CPM price on overall campaign results for both agency and advertiser survey clients. To model the impact of Rocket Fuel, Forrester built out a summary impact for sample 30-, 60-, and 90- day campaigns for both agency and advertiser clients. To measure this impact over time, Forrester then extended the analysis over a three-year period to factor in both the growth of campaign spend as well as the shift of marketing spend to Rocket Fuel and determine the effect on overall marketing ROI. While campaign ROI represents the primary measure of financial benefit, there were other factors mentioned by the clients including improved key performance indicators (KPIs) from brand awareness and team efficiency. While these impacts were noted as part of the overall value proposition, the primary measure for the sampled organizations was ROI impact on campaigns. Page 9

11 ROI Analysis Agency To calculate the Rocket Fuel impact on success of individual campaigns for agency clients, Forrester built out three separate models highlighting the impact over the course of 30-day, 60-day, and 90-day campaigns. Specific calculations can be found in Appendix A of this document. Charts below illustrate the impact on ROI of using Rocket Fuel, compared with two other alternatives, low and medium. Figure 3 illustrates the ROI impact of a 90-day campaign. For the total length of the campaign, the comparative ROI impact for Rocket Fuel is a 144% improvement, compared with the low alternative, and a 61% improvement, compared with the medium alternative. The total ROI impact for Rocket Fuel is 122%, compared with 50% for the low alternative and 76% for the medium alternative. Figure 3 Campaign Impact 90-Day Average campaign impact: 90-day, Rocket Fuel versus alternative 140% 120% 100% 80% ROI 60% 40% 20% 0% -20% -40% Rocket Fuel 0% 19% 71% 88% 89% 122% Alternative - Medium 0% 0% 59% 60% 60% 76% Alternative - Low -17% -14% -11% 19% 34% 50% For 30-day and 60-day campaigns, the results follow a similar pattern for Rocket Fuel, compared with the selected alternatives (see Figure 4, and see Figure 5). The ROI impacts for the 60-day campaign are a 71% improvement, compared with the low alternative, and a 39% improvement, compared with the medium alternative. For the 30-day campaigns, the ROI difference is a 48% improvement, compared with the low alternative, and a 12% improvement, compared with the medium alternative. Page 10

12 Figure 4 Campaign Impact 60-Day 180% Average campaign impact: 60-day, Rocket Fuel versus alternative 160% 140% 120% ROI 100% 80% 60% 40% 20% 0% Rocket Fuel 42% 96% 139% 154% Alternative - Medium 46% 46% 65% 111% Alternative - Low 46% 46% 59% 90% Page 11

13 Figure 5 Campaign Impact 30-Day Average campaign impact: 30-day, Rocket Fuel versus alternative 140% 120% 100% ROI 80% 60% 40% 20% 0% Rocket Fuel 42% 133% Alternative - Medium 46% 119% Alternative - Low 46% 90% Total Cumulative Impact Figures 3 through 5 above provide a snapshot of the type of impact of Rocket Fuel on a single campaign. However, many of the agency organizations Forrester spoke to saw a longitudinal impact over multiple campaigns and over multiple campaign cycles. Taking a longer view of the cumulative impact of investing with Rocket Fuel to three years, we analyzed the effect on marketing spend efficiency. For this analysis, Forrester assumes a 20% shift in annual media buy spend to Rocket Fuel, increasing the number of campaigns executed by Rocket Fuel over time. The result is an increase in advertising spend, from 204% in Year 1 to 229% in Year 3. Figure 6 illustrates the shift from Year 1 to Year 3. Page 12

14 Figure 6 Impact Of Rocket Fuel On Average Campaign ROI Agency Growth in average campaign ROI: three-year analysis for the agency Rocket Fuel Alternative - Medium Alternative- Low Y1 Y2 Y3 ROI Analysis Advertiser In the case of advertiser impact of the investment in Rocket Fuel, the approach was similar to the agency impact. However, the advertisers sampled as part of this research were predominately using Rocket Fuel for 90-day campaigns, as opposed to a wider set in the agency example. As in the agency example, Forrester modeled the impact of using Rocket Fuel on individual 90-day campaigns, compared with two alternative media buy options. Results of this analysis are shown in Figure 7, and the ROI calculations are illustrated in Appendix A. Page 13

15 Figure 7 Campaign Impact 90-Day Advertiser Average Campaign Impact - 90 day average - RF vs. Alt. ROI 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Rocket Fuel 39% 59% 60% 55% 52% 88% Alternative - Medium 13% 16% 25% 25% 28% 30% Alternative - Low 23% 35% 34% 35% 35% 57% Non-ROI Impacts In addition to the direct ROI impacts resulting from leveraging Rocket Fuel, the two advertisers also noted several other more qualitative benefits resulting from the engagement. In certain cases, the reason for moving to Rocket Fuel was less for tangible revenue lift within campaigns and more for an impact on brand awareness. Clients measured this effect through external brand surveys. While not as financially tangible as direct conversion from campaigns, it still represents an important metric in choosing the appropriate level of spend with Rocket Fuel. Total Cumulative Impact As with the agency example, Forrester extended the effect of a shift in spend to Rocket Fuel over a three-year period. Page 14

16 Figure 8 Campaign Impact Three-Year Analysis Advertiser Growth in average campaign ROI - 3 year analysis - Advertiser Rocket Fuel Alternative - Medium Alternative - Low Y1 Y2 Y3 Page 15

17 Financial Summary More and more campaigns are run with Rocket Fuel because we see the results of their algorithms to help us find the targeted audiences we need. Our campaigns seek a very specific buyer type, and we ve found that Rocket Fuel consistently delivers. (CEO, interactive marketing agency) The financial results for both agencies and advertisers point to positive impacts on campaign ROI resulting from an investment in Rocket Fuel. Surveyed organizations noted that Rocket Fuel provided positive tangible benefits for campaigns, which required specific targets for campaign reach and applicability based on demographic or geographic criteria. As a result, organizations saw value in using Rocket Fuel as part of their overall media buy strategy in cases where a CPM price premium justified the increased ROI from campaign success. Table 3 below summarizes the campaign ROI impact for individual campaigns as well as incrementally over a threeyear analysis. Forrester urges readers to use this representative analysis to evaluate the potential financial impact on their own organization. Table 3 Agency And Advertiser Representative Organization: ROI Campaign Impact Across Selected Campaigns Average campaign length Interactive media agency Advertiser 30 Days 133% 60 Days 154% 90 Days 122% 88% Three-year campaign impact 229% 192% Page 16

18 Appendix A: ROI Campaign Assumptions For this TEI study, Forrester has created a composite organization to illustrate the quantifiable costs and benefits of implementing Rocket Fuel. Forrester has modeled two representative organizations for this analysis: an advertiser and agency using Rocket Fuel as part of their overall media buy. Agency Campaign Impact Table 4 Ninety-Day Campaign Impact Assumptions Agency Network Alternative: low Alternative: medium Rocket Fuel Change versus low alternative Change versus medium alternative Campaign duration (days) Daily impressions 12,000 12,000 12,000 Average conversion rate 10% 11% 13% Projected revenue impact $30 $30 $30 Total impressions 1,080,000 1,080,000 1,080,000 Conversions Revenue $4,860 $5,700 $8,400 Spend $3,240 $3,240 $3,780 Profit $1,620 $2,460 $4,620 Overall ROI 50% 76% 122% 144% 61% Page 17

19 Table 5 Sixty-Day Campaign Impact Assumptions Agency Network Alternative: low Alternative: medium Rocket Fuel Change versus low alternative Change versus medium alternative Campaign duration (days) Daily impressions 8,000 8,000 8,000 Average conversion rate 7% 7% 8% Projected revenue impact $35 $35 $35 Total impressions 480, , ,000 Conversions Revenue $2,730 $3,045 $4,270 Spend $1,440 $1,440 $1,680 Profit $1,290 $1,605 $2,590 Overall ROI 90% 111% 154% 72% 38% Page 18

20 Table 6 Thirty-Day Campaign Impact Assumptions Agency Network Alternative: low Alternative: medium Rocket Fuel Change versus low alternative Change versus medium alternative Campaign duration (days) Daily impressions 8,000 8,000 8,000 Average conversion rate 7% 7% 8% Projected revenue impact $35 $35 $35 Total impressions 240, , ,000 Conversions Revenue $1,365 $1,575 $1,960 Spend $720 $720 $840 Profit $645 $855 $1,120 Overall ROI 90% 119% 133% 49% 12% Page 19

21 Advertiser Campaign Impact Table 7 Ninety-Day Campaign Impact Assumptions Advertiser Network Alternative: low Alternative: medium Rocket Fuel Change versus low alternative Change versus medium alternative Campaign duration (days) Daily impressions 44,000 44,000 44,000 Average conversion rate 5% 6% 8% Projected revenue impact $45 $45 $45 Total impressions 3,960,000 3,960,000 3,960,000 Conversions Revenue $8,910 $10,665 $13,500 Spend $7,920 $7,920 $8,910 Profit $990 $2,745 $4,590 Overall ROI 13% 35% 52% 312% 49% Page 20

22 About Rocket Fuel According to Rocket Fuel, Rocket Fuel delivers a programmatic media-buying platform at big data scale that harnesses the power of artificial intelligence to improve marketing ROI. Rocket Fuel's Advertising That Learns technology drives results for advertisers, and empowers media teams to focus on strategy, not spreadsheets. Its distributed planetscale computing engine currently screens over 28 billion ad opportunities per day, and selects the best for its customers, via real-time bidding (RTB) relationships with major publishers and exchanges. The technique has delivered across web, mobile, video, and social channels, with 894 brands powered by Rocket Fuel in Products Rocket Fuel's products drive results across all stages of a consumer's journey and help advertisers by leveraging artificial intelligence and unlocking the power of big data to boost multi-channel campaigns across display, video, mobile & social. Booster Suite Brand Booster helps brand marketers use the full power of programmatic buying to increase their brand equity. Brand Booster can help marketers reach audiences with high precision to maximize reach and frequency, or generate brand lift in awareness, recall, consideration, favorability, and purchase intent. DR Booster helps marketers quickly generate online conversions. Rocket Fuel DR Booster is unique in the programmatic buying market in that it analyses both current site visitors and new prospects ("act-alikes") with proprietary data models, and calculates conversion propensity scores ("how likely are they to X") for each of them, thus guaranteeing the most efficient spend for an acquisition budget. Offline Booster helps marketers link their online campaigns to sales that are not immediately measurable online, and applies offline sales and CRM data to Rocket Fuel's online media optimization models to create the first closed-loop online-offline optimization solution on the market. Channel Suite Rocket Fuel provides its customers the ability to decide where, when and how much money to allocate to digital display, video, mobile and social media. 1. Rocket Fuel Display is a channel in which Rocket Fuel first started to serve display ads and in which Internet advertising has lived its longest history. 2. Rocket Fuel Video offers pre-roll and in-banner video inventory, typically recommended for branding or engagement-oriented campaign goals. 3. Rocket Fuel Social is the fastest-growing media channel product today. Rocket Fuel FBX (our integration with Facebook's real-time exchange) provides marketers with an unprecedented opportunity to apply artificial intelligence to truly optimize toward ROI from Facebook. 4. Rocket Fuel Mobile takes advantage of the unique attributes of the mobile browsing experience. Page 21

23 Modules Rocket Fuel's Modules are technical or service based capabilities that can be availed with each product. 1. Insights & Analytics Rocket Fuel offers insights & analytics in both self-service and custom-service modes. The self-service mode allows customers to follow campaign progress in real-time, whereas the custom-service mode gives customers access to an analyst team to help them answer more complex questions like multichannel attribution. 2. Data Integration Services (DIS) DIS helps unlock the power of enterprise data to boost media campaigns. DIS supports a variety of integration mechanisms to harvest enterprise data including server-to-server integration, flat files, offline data, universal pixels, and other custom integration architectures. 3. Dynamic Creative Optimization (DCO) DCO facilitates the convergence of art & science by delivering inspiring creative messages that are personalized based on an individual's past behavior, intent & current context. 4. Brand Assurance Rocket Fuel goes beyond what industry guidelines prescribe, building additional levels of safety and security right into our platform and processes. Consequently, our clients get multiple levels of defense that ensure their ads are always served to real people and in safe environments. 5. Consulting Services Rocket Fuel's consulting services help address a wide variety of client needs spanning across data integration, creative asset development, campaign analytics, data on-boarding, multichannel attribution, media-mix modeling, and other custom requirements. Vertical Solutions Based on Rocket Fuel's Products & Modules, Rocket Fuel's vertical solutions address the end-to-end consumer marketing lifecycle challenges in any given industry vertical, with current deployments of solutions for automotive, CPG, retail, and financial services, and with more verticals identified for Page 22

24 Appendix B: Total Economic Impact Overview Total Economic Impact is a methodology developed by Forrester Research that enhances a company s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders. The TEI methodology consists of four components to evaluate investment value: benefits, costs, risks, and flexibility. Benefits Benefits represent the value delivered to the user organization ---- IT and/or business units ---- by the proposed product or project. Often product or project justification exercises focus just on IT cost and cost reduction, leaving little room to analyze the effect of the technology on the entire organization. The TEI methodology and the resulting financial model place equal weight on the measure of benefits and the measure of costs, allowing for a full examination of the effect of the technology on the entire organization. Calculation of benefit estimates involves a clear dialogue with the user organization to understand the specific value that is created. In addition, Forrester also requires that there be a clear line of accountability established between the measurement and justification of benefit estimates after the project has been completed. This ensures that benefit estimates tie back directly to the bottom line. Costs Costs represent the investment necessary to capture the value, or benefits, of the proposed project. IT or the business units may incur costs in the form of fully burdened labor, subcontractors, or materials. Costs consider all the investments and expenses necessary to deliver the proposed value. In addition, the cost category within TEI captures any incremental costs over the existing environment for ongoing costs associated with the solution. All costs must be tied to the benefits that are created. Risk Risk measures the uncertainty of benefit and cost estimates contained within the investment. Uncertainty is measured in two ways: 1) the likelihood that the cost and benefit estimates will meet the original projections, and 2) the likelihood that the estimates will be measured and tracked over time. TEI applies a probability density function known as triangular distribution to the values entered. At minimum, three values are calculated to estimate the underlying range around each cost and benefit. Flexibility Within the TEI methodology, direct benefits represent one part of the investment value. While direct benefits can typically be the primary way to justify a project, Forrester believes that organizations should be able to measure the strategic value of an investment. Flexibility represents the value that can be obtained for some future additional investment building on top of the initial investment already made. For instance, an investment in an enterprise wide upgrade of an office productivity suite can potentially increase standardization (to increase efficiency) and reduce licensing costs. However, an embedded collaboration feature may translate to greater worker productivity if activated. The collaboration can only be used with additional investment in training at some future point in time. However, Page 23

25 having the ability to capture that benefit has a present value that can be estimated. The flexibility component of TEI captures that value. Appendix C: Glossary Return on investment (ROI): A measure of a project s expected return in percentage terms. ROI is calculated by dividing net benefits (benefits minus costs) by costs. Demand Side Platform (DSP): A dedicated buy-side tool that helps media buyers programmatically manage, bid on, and buy digital media impressions. Real Time Bidding (RTB): The ability to bid and buy digital inventory from multiple publishers on an impression by impression basis in real time. Algorithm: A programmatic way to improve automation by allowing media buyers to better predict and plan the reach of targeted campaigns. Page 24