Group Buying in Australia a Telsyte Presentation - August 2011 Who Is Telsyte and What Do We Do?

Group buying in Australia A Telsyte presentation - August 2011 Who is Telsyte and what do we do?

• Emerging technology analyst insights firm Telsyte group buying research?

• Database of +22,000 deals

Site Deal Price Location Sold Saved

RRP Merchant Time Value Category

Source: Telsyte online group buying database 2011 Group buying in Australia A Telsyte presentation – August 2011 Online shopping landscape

Range Group Buying merchandising

Drop shipping Flash Sales and consignment Market revenue - $50 million per month

$60.0

$50.0 $48.3 $43.6

$40.0 $31.9 $30.0 $28.6 $25.2

$ million $ $23.1 $18.1 $20.0 $16.1 $11.0 $10.0 $7.0 $4.5 $2.7 $0.1 $0.1 $0.2 $0.8 $1.6 $0.0

Source: Telsyte online group buying Q2 2011 update *measured as gross revenue inc. GST Market to grow 6 times over Y0Y

$450.0 $400 million+ $400.0 $350.0 Forecasted $300.0 +$200 mill Q3+Q4 $250.0

$200.0 $ million $ $150.0 $123.9 Q2 11 $100.0 $67.2 $50.0 $71.8 Q1 11 $0.0 2010 2011

Source: Telsyte online group buying Q2 2011 update Zero to 1 million vouchers in less than 24 months

1,000,000 900,000 800,000 700,000 600,000 12000% growth in 12 months 500,000 400,000 300,000 200,000 100,000

11 11

11 11 11

10 10 10

10 10

- -

- - -

- -

Jul

Jan

Jun

Apr

Feb

Apr

Oct

Feb

Sep

Mar

Dec

Mar

Aug

Nov

May May

Source: Telsyte online group buying Q2 2011 update Zero to 4000 deals available per month

4,000

3,500

3,000

2,500 22000% growth in 12 months 2,000

1,500

1,000

500

Source: Telsyte online group buying Q2 2011 update Average price of deal is growing

$90 $86 $80

$70 $68 $60

$50 $50 $44 $40 $39 $40 $30 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011

Source: Telsyte online group buying 2010- 2011 update Shift from Health & Beauty deals

Other Q4 2010 Other Products Products Q2 2011 and Services and Services 8% 14%

Leisure and Recreation Health and 15% Beauty Health and 33% Beauty Leisure and 47% Recreation Food and 26% Dining 30% Food and Dining 27%

Source: Telsyte online group buying Q2 2011 update Nothing is set in stone!

DealMe, 2.0% Travelzoo, 1.3% GrabOne AU, 0.9% Ouffer, 2.4% Deals.com.au, 4.5% Others, 5.4% Scoopon, 20.5% Ourdeal, 5.9%

Groupon Cudo, 16.7% (Stardeals), 8.5%

Spreets, 15.5% Living Social / Jump On It, 16.4%

Source: Telsyte online group buying Q2 2011 update $325,000 after a few days of launch Revenue by location (market growth) $40 mil 35.6 $35 mil

$30 mil 27.1 $25 mil 22.7 21.0 $20 mil 16.7 14.0 $15 mil 13.1 12.0 $10 mil 9.0 7.9 8.0 5.1 $5 mil 1.7 1.9 $0 mil Sydney Melbourne National Perth Brisbane Adelaide Gold Coast (incl other suburbs) Q4 2010 Q1 2011 Q2 2011

Source: Telsyte online group buying Q4 2010, Q1 and Q2 2011 update Key theme: Strong Industry Growth

+Revenue

+Market +Category Players +$400 million +Industry +Price Point 2011 Employees

+Deals and +Location Vouchers Expansion Sold Top 5 future trends The future?

1. Growth of market entrants and exits The future?

1. Growth of market entrants and exits 2. Restoration of tipping points Tiered tipping points

Average versus 246 vouchers sold per deal The future?

1. Growth of market entrants and exits 2. Restoration of tipping points 3. Continued gap in revenue between large and smaller players Revenue gaps creating different markets

Large Sites Medium sites Small sites New Players Upcoming Sites Aggregator Sites (over $1 mil per mth) ($100K to $999K per mth) (below $99K per month)

Scoopon Daily Bonanza AntMart 123cars Facebook Deals All the Deals

Cudo DealMe! Couee Daily Deals for Mum Google Offers Big Deal Hub

Living Social / Jump Deals.com.au Deal Monkey Deals Nearby Good News Buyii On It

Spreets EZ Deals Deal2day Dupon Dealfetch

Groupon (Stardeals) Travel Zoo DineToday Good2Great Deals Grouped

Ourdeal Love It UP Food Morning Grabbed Dealsguide

Deals.com.au GrabOne GottaGetIt Honey and Ginger The Dealer

Ouffer Smartie Groochi ikOala Everyday

Voucher.com.au LilBirdie Le Domaine

Yellow Pages Deals Lime and Tonic MatesPay

Offerme Monthlycatch

Jigo City MyDeal

Shareon Red Vouchers

Snag A Deal Spargain

Somuch Spurr

Todayzdeals

Voucher ON Source: Telsyte Australian online group buying market Q2 2011 update The future?

1. Growth of market entrants and exits 2. Restoration of tipping points 3. Continued gap in revenue between large and smaller players 4. Aggregator maturity Aggregator maturity

Partnerships and editorial Better site design and functionality Mobile applications

Targeted emails and deals

Simple aggregation

Affiliate program development The future?

1. Growth of market entrants and exits 2. Restoration of tipping points 3. Continued gap in revenue between large and smaller players 4. Aggregator maturity 5. Secondary markets Daily Deal & Group Buying Websites – A New Distribution Channel or a Flash In The Pan? Source: http://blog.yipit.com Thank You

• SamYip Senior Research Manager Tel: +612 8297 4607 Twitter: @sam_yip Email: [email protected]

Telsyte is a business unit of UXC