The Tech Titans Were Caught Napping
Little-known company is on its way to dominating an untapped $129 billion digital advertising market.
It is an article of faith that no one can compete and win against Google or Facebook.
Many have tried, none have succeeded.
So when tech entrepreneur Matthew Pierce announced the launch of a revolutionary advertising platform, the investor community naturally looked it over with a skeptical eye.
Pierce was well known for his golden touch with tech startups.
His last tech venture, a wireless location tech developer, was renowned as a Silicon Valley standout that attracted venture capital from the likes of Allegis Capital and Motorola Ventures among others, before its successful $25 billion buyout.
That and other tech successes gave Pierce some strong “creds” in the tech VC and analyst communities.
Still, VCs and analysts were in general agreement that it took some serious gumption to launch a company that would attempt to go up against the tech titans for a share of the enormous digital advertising market.
But what analysts didn’t realize yet was that this undervalued company was targeting an entirely different market segment.
It’s a slice of the digital universe that was being entirely overlooked by the tech titans.
And with the explosive growth of digital advertising, it looked like a once-in-a-lifetime opportunity to join the tech heavyweights without having to compete with them.
Today, that is looking more and more likely.
Just a few short years since launching its breakthrough platform,
This compay has already attracted some of the world’s biggest multi-billion dollar corporations as clients – names like Home Depot and Target – as well as numerous others.
And that’s not all.
In a resounding vote of confidence, multinational tech leader HP Inc., number 58 in the Fortune Global 500, chose them as their technology partner for the ultra-high end Omen computer line.
The company is proving to be in exactly the right market at exactly the right time.
They’re rapidly gaining market share in a segment with zero headwinds.
A market that surprisingly is still untapped by Google, Facebook, or any other major player.
Just 20 years ago, only 5% of all ad dollars went to digital mediums.
But the world is changing. People are moving online in greater and greater numbers. And advertising dollars are following them.
Today digital ads consume more than half of the $628 billion global ad market.
But with Google and Facebook taking 70 cents out of every dollar of online advertising, few other companies have been able to achieve significance.
That duopoly dominates online search and social media.
But no one controlled an overlooked market segment that had almost invisibly grown to a whopping $129 billion.
The tech titans were caught napping.
Which means that a multi-billion dollar market was wide open and ripe for the taking.
A bold move for share of $129 billion digital ad market segment
Surprisingly, what this company found was a large and fast-growing online market segment that was served only by a network of small, fragmented players.
It’s a market that generates an estimated $129 billion a year in ad revenue, and is growing at a lightning-speed CAGR of 20%.
By Pierce’s thinking…
If they could build a technology that would monetize the market in a way that delivered intrinsic value to both users and advertisers, they could become as dominant in that market as Google or Facebook are in theirs.
The logic was sound, and capital markets agreed.
They raised in initial $14.3 million in post-IPO equity funding, giving Pierce and the company the impetus to begin development in earnest.
So what is this fast-growing but overlooked market that was so attractive?
“One of the most profitable industries on the planet”
That’s what emerging trends publisher VisualCapitalist reported in July 2020.
“In mere decades,” they wrote, the industry “has exploded in popularity to become one of the most profitable industries on the planet.”
In short, the industry is “an unstoppable force.”
The market is digital online gaming, and if you don’t know much about that industry yet, you’re in for a shock.
- Online gaming has become so big that a single game, Grand Theft Auto V, has grossed more than $6 billion, making it the most profitable entertainment release of all time in any medium.
- Online gaming is now the biggest form of entertainment in the world, eclipsing all other categories.
- More than one in three of the world’s population – 2.7 billion people – regularly engage in digital games.
- 75% of all American households have at least one online gamer.
- The $152 billion online games market is already 3.5 times bigger than global movie box office revenue, and 8 times bigger than the entire music recording industry.
- Competitive gaming is a fast-growing market segment, with prize pools as high as $34 million for a single event.
- In 2019, competitors in the popular Fortnite game vied for a $64.4 million prize pool.
- Fortnite claims more than 250 million registered players.
- The game League of Legends boasts 27 million average daily players.
Online gaming one of the fastest growing markets in the world, projected to reach more than $222 billion by 2023.
With that multi-billion dollar opportunity wide open,
This company developed and launched a platform that monetizes the $129 billion digital gaming market the same way Google monetizes search and Facebook monetizes social media.
But managed to do their model one better.
The company’s ad delivery system entices and rewards game players to watch ads.
Because, let’s face it, no one likes ads.
Which is why the platform is such a brilliant breakthrough.
People will do anything they can to avoid the unwanted intrusion of ads.
From learning how to turn off cookies and clear browsing history, to installing ad blockers or ad filters, ads are a never-ending annoyance for internet users and a high-stakes game to outfox internet users for advertisers.
Gamers are especially turned off by ads that pop up mid-game (as most do), throwing the player off rhythm, breaking their concentration, and potentially costing them the game.
Solving the oldest problem in advertising
About one hundred years ago, department store magnate John Wanamaker was reputed to have said, “Half the money I spend on advertising is wasted. The trouble is, I don’t know which half.”
Fast forward to today, and studies show he was right. More than 40% of ad dollars across all mediums fail to either reach their audience or make an impression.
It’s even worse for online advertisers, where more than half of all digital ad dollars wasted.
It’s an agonizing problem for advertisers, but one they have had no choice but to accept as just the cost of doing business.
Now, though, this company has created a way to get more out of every ad dollar.
Thirty six times more, in fact.
A quick look at just two case studies reveals that:
- A national quick service restaurant chain using this platform achieved an ad response rate that was a groundbreaking 36 times higher than industry standard, in addition to a 280% growth in incremental purchases.
- A top game publisher saw a 44% increase in user session time and a whopping 15 minutes of advertiser brand exposure per game when using their ad system.
Results like those are why more and more major brand advertisers are joining the fast-growing universe of clients.
Competitive landscape is wide open
Digital gaming produces an enormous $129 billion a year in ad revenue, and is growing at a rapid CAGR of 20%.
There are no other dominant ad platforms in the industry.
The value of this company’s unique platform is reflected in the impressive list of the company’s billion-dollar clients.
The robustness of their technology is proven by its selection by tech giant HP Inc. to power its gaming rewards systems. This is just the beginning for the rapidly growing company that still trades at a price well below its peers.
But it won’t for long. As more news is generated and word gets out, expect investors to discover this up-and-coming social network. Sign up to receive more information about this innovative young company that is poised to take the lead.
6 https://www.visualcapitalist.com/online-gaming-the-rise-of-a-multi-billion-dollar-industry/ 7 https://www.superdataresearch.com/reports/millennials 8 https://gamecrate.com/statistically-video-games-are-now-most-popular-and-profitable-form-entertainment/20087 9 https://esportsobserver.com/biggest-esports-2019-prize-pool/ 10 https://www.marketresearch.com/Business-Research-Company-v4006/Web-content-Search-Portals-Social-13170503/ 11 https://www.mediapost.com/publications/article/340946/data-estimates-40-of-all-media-spend-is-wasted-.html 12 https://www.marketingdive.com/news/study-consumer-brands-waste-50b-of-digital-trade-marketing-spend/560424/ 13 https://static1.squarespace.com/static/58eec7ff6b8f5b2252e9ab4c/t/5e597b623ca1436a76e8dbc3/1582922648079/WhiteCastle_CaseStudy.pdf 14 https://static1.squarespace.com/static/58eec7ff6b8f5b2252e9ab4c/t/5e5971572c202b5196e5c2af/1582920068615/NASCAR_CaseStudy.pdf
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