The Courage to Challenge

FIFA WORLD CUP RUSSIA 2018 THE COURAGE TO CHALLENGE

A few days after the end of the World broadcasting rights were now on the mar- “The aim was to help Italians “overcoming Cup, it is time to make a balance of the ket at a more accessible price. We realized the grief” of a World Cup without the Ita- event, together with Mediaset, the o - that, with an adequate preparation and lian national team, and to realize that cial broadcaster in Italy, and to try and explanation to advertisers and investors, despite this fact, it still remained the most understand what it took to make a clear the costs could be covered by advertising interesting global event of all - comments media success out of it - in spite of the sales, and the event represented a ratio- Matteo Cardani Marketing General Direc- initial skepticism. In the media and in nal choice for advertisers. We knew that in tor of Publitalia’80 - We wanted to remind communication, such as in sports, the the last 2 editions (2010-2014) the Italian them that most top players of their Serie A results never come by chance, but only national team never went pass the group favourite teams would still have featured through a thorough preparation and the stage and its audiences only represented in the World Cup, which would still have combination of well-planned factors. 5% of the total”. been an unmissable event for football fans. This is how we kept the hard-core of the BACKGROUND SIX MONTHS OF PREPARATION audience in-tune with the event”. The winter night after the unexpected The preparation of the event by Mediaset defeat of the Italian national team at the was the result of a” teamVersione play” verticale positiva involving hands of Sweden in the World Cup qua- editorial decision-making, editorial pro- lier play-o, the rst question coming motion, digital o er development and to mind was “how much is a World Cup promotion of the o er on the investor without their own national team worth to market.” the Italian audience?” For some it was worth little, it cost too Starting from a press conference in De- much and denitely not enough to re- cember announcing the broadcasting pay the investment. “We instead saw it rights acquisition and then throughout as an opportunity - says Stefano Sala, the Spring, the publisher promoted the CEO of Mediaset’s advertising sales hou- event in an “organic” way within its exi- se Publitalia’80 - a World Cup with the sting football coverage of the Italian Se- Italian national team is normally a public rie A and Champions League matches, service TV event. We thought however that as well as within in-depth sports pro- even without Italy, the World Cup certainly gramming, and nally through self-pro- remains the global event of greatest me- motion TV and radio campaigns all the dia interest, but with the advantage that way until the eve of the World Cup.

1 As shown in the graphs [graph 1 and WORLD CUP: AN EXTREMELY ATTRACTIVE GLOBAL EVENT (Chart 1) 2] of the 3 research waves conducted First mentioned Other mentions Total unaided recall First mentioned Other mentions Total unaided recall by Publitalia in January, April and June, FIFA World Cup 72,4% 1,7% 74,1% First mentioned Other mentions Total unaided recall 3 Italians out of 4 considered the Wor- FIFA WorldFormula Cup 1 5,7% 6,5% 72,4% 1,7% 74,1% FIFA World Cup 72,4% 1,7% 74,1% ld Cup as “The Sport Event” of 2018. FormulaMotoGP 1 5,7%3,7% 4,3%6,5% Formula 1 5,7% 6,5% The editorial promotion on our media Tour deMotoGP France 3,7%3,9% 4,3%4,0% MotoGP 3,7% 4,3% generated an uplift from 50% at the be- TourOlympic de France Games 3,9%1,7% 4,0%2,9% Tour de France 3,9% 4,0% OlympicWimbledon Games 1,7%1,9% 2,9%1,9% ginning of the year up to 74% on the eve Olympic Games 1,7% 2,9% WimbledonUEFA CHL 1,9% 1,9% of the event. Wimbledon 1,9% 1,9%1,7% UEFATennis CHL 1,7% UEFA CHL 1,7%1,6% Tennis 1,6% It is important to note that among the VolleyballTennis 1,6%1,2% VolleyballCycling 1,2% football fans target both awareness Volleyball 1,2%1,0% GiroCyclingCycling d'italia 1,0%1,0% and intention to watch the event were 1,0% GiroGiro d'italia Seried'italia A 1,0%1,0%0,9% in the region of 90% right before the SerieAthleticsSerie A A 0,9%0,9%0,9% event start. SwimmingAthleticsAthletics 0,9%0,9%0,5% When weighted against the total popu- SwimmingSwimmingFootball 0,5%0,5%0,5% lation, it meant 1 in 2 Italians were keen FootballFootball 0,5%0,5% Source: CAWI tracking carried out by Human Highway, 3.000 interviews to follow the event on a regular basis. Source:Source: CAWI CAWI tracking tracking carried out by HumanHuman Highway, Highway, 3.000 3.000 interviews interviews

“We believe in marketing research and AWARENESS AND INTENTION TO WATCH THE WORLD CUP, ON THE EVE OF THE EVENT (Chart 2) we continually commission researches for ourselves and for the companies that work with us - continues Matteo +38,8% Cardani - and this was an encouraging +38,8% preliminary figure, but many look at 87,8%87,8% 85,6% 87,8% 85,6% statements with skepticism and only 74,1%74,1% 85,6% ratings are what really matters in the 74,1% 56,9%56,9% end. 53,4% 51,5%51,5% 53,4% 56,9% The rst 4 days of the World Cup 51,5% backed us up: in just 4 days and 11 games the above mentioned 50% of the population did actually tu- ned in... rising to 70% in the weekend January AprilApril June June Often Often WillWill follow follow Will Willfollow follow when the knockout matches started. often+very often the often+very often the January April June watchOftenwatch often+veryWill follow often the often+veryWill follow often the With the likes of Messi, Ronaldo and Inie- often+veryeventevent on TVoftenon TV the often+veryeventevent on often on the footballfootballwatch on on (AVERAGE) TV(FOOTBALL sta on the pitch... the audiences took a TV event(AVERAGE) on TV TV(FOOTBALLevent on footballTV on (AVERAGE) WATCHERS)TV(FOOTBALLWATCHERS) further boost”. Source: CAWI tracking carried out by Human Highway,TV 3.000 interviews WATCHERS) Source: CAWI tracking carried out by Human Highway, 3.000 interviews Source: CAWI tracking carried out by Human Highway, 3.000 interviews LIVE MATCHES - REACH TREND

100% 100% 100% 90% 90% Quarter finals Semifinals Finals Round of 16 Quarter finals Semifinals Finals 90%80% Round of 16 Quarter finals Semifinals Finals79 80% 78 End of Group stage Round of 16 76 78 79 80%70% End of Group stage 75 79 First 32 matches 76 78 70% First 32End matches of Group stage 70 75 76 70%60% First 16 matches 66 70 75 First 32 matches 66 60% FirstFirst 16 4 matches 58 70 days 66 60%50% FirstFirst 16 4 matches 52 58 50% Firstdays 4 58 50%40% days 52 40% 52 40%30% 30% 20% 30% 20% 10% 20% 10% 0% 10% 0% 0% 14/06/18 15/06/18 16/06/18 17/06/18 18/06/18 19/06/18 20/06/18 21/06/18 22/06/18 23/06/18 24/06/18 25/06/18 26/06/18 27/06/18 28/06/18 29/06/18 30/06/18 01/07/18 02/07/18 03/07/18 04/07/18 05/07/18 06/07/18 07/07/18 08/07/18 09/07/18 10/07/18 11/07/18 12/07/18 13/07/18 14/07/18 15/07/18 Source: Auditel - Individuals 14/06/18 15/06/18 16/06/18 17/06/18 18/06/18 19/06/18 20/06/18 21/06/18 22/06/18 23/06/18 24/06/18 25/06/18 26/06/18 27/06/18 28/06/18 29/06/18 30/06/18 01/07/18 02/07/18 03/07/18 04/07/18 05/07/18 06/07/18 07/07/18 08/07/18 09/07/18 10/07/18 11/07/18 12/07/18 13/07/18 14/07/18 15/07/18

Source:14/06/18 Auditel15/06/18 16/06/18 - Individuals17/06/18 18/06/18 19/06/18 20/06/18 21/06/18 22/06/18 23/06/18 24/06/18 25/06/18 26/06/18 27/06/18 28/06/18 29/06/18 30/06/18 01/07/18 02/07/18 03/07/18 04/07/18 05/07/18 06/07/18 07/07/18 08/07/18 09/07/18 10/07/18 11/07/18 12/07/18 13/07/18 14/07/18 15/07/18 2 Source: Auditel - Individuals WINNING THE AUDIENCE CHALLENGE 64 games, 120 when simulcast is also Top-tier group stage matches and “We started to meet with advertising considered, all free-to-air. Over 80 com- knock-out stage matches were aired investors 6 months ahead of the event panies have agreed to our integral ap- on flagship channel Canale5, while the - recalls Matteo Sordo, Customers Ge- proach”. bulk of the group stage matches was neral Director of Publitalia’80 – and we “In this coordinated approach to the on Italia1, Mediaset Extra provided an pledged to them that this would have market it was important to share our always-on coverage and parallel ma- been be the FIFA World Cup with the hi- audience estimation criteria with me- tches were aired on channel 20”. ghest audience of the last 20 years. dia agencies - added Customers and This rational promise has been develo- Agencies General Director Nicola Lus- The audience challenge has been cle- ped into an ambitious commercial offer sana - to make them well aware of the arly won throughout all phases of the - we asked advertisers to plan the whole audience potential of a World Cup aired tournament, as shown by the graph event - with reserved positions around free-to-air on 4 national channels. below. TOTAL CUMULATED AMR

Mio 297 300 280 258 251 250 226 202 200 175 156 150 135 120

100 66 64 48 47 50 World Cup 2014 0 First 4 days First 16 First 32 Group stage Round of 16 / Semifinals Finals matches matches Quarter-finals

Source: Auditel – Individuals

We are very satised as the estimates made 6 months ago have been conrmed by actual gures, despite the fact that sport events are subject to higher than average audience swings and are harder to predict.

The fact that we could deliver what we promised in terms of audience was a rst certain element of return of investment for advertisers. 3 TEAM PLAY AND THE EDITORIAL been brought by in-depth analysis STORYTELLING OF THE EVENT sports programming (featuring rising On the pitch, the Russian World Cup star Giorgia Rossi and Pierluigi Pardo’s certainly saw team play prevailing over Tiki Taka Russia, a format which drew individuals. big audiences). The same principle is at the heart of our audience success: starting from a rational scheduling of the 120 live events across 4 national channels (which generated a remarkable daytime exploit for Italia1, already forecast 6 months in advance), and adding to it the experience and expertise of the Mediaset sports editorial team, led by Alberto Brandi and featuring heavy-weight commentators and pundits such as Sandro Piccinini, TIKI TAKA RUSSIA Pierluigi Pardo, Massimo Callegari and A.M.R. INDIVIDUALS 1.814.149 Fabrizio Ferrero. SHARE MEN 17% Besides live matches, a key boost had

According to a post-event research the audience enjoyed Mediaset’s storytelling of the event, giving it very high marks.

THE BEST WORLD CUP EVER! ITALY NOT PLAYING: SURELY SOMETHING TO REGRET, YET NOT AN OBSTACLE TO WATCHING «GREAT FOOTBALL» Compared to Adults 15-64 y.o. Italy has not Adults 15-64 y.o. previous editions of played at this the World Cup, as World Cup. to the way it has Have you been broadcast, do followed the event 69% you think this World with pleasure 69,2% Followed Cup has been: anyway or has with better the abscence of pleasure Italy been an BETTER THE SAME WORSE obstacle to FOLLOWED WITH PLEASURE IT HAS BEEN AN OBSTACLE watching the Men World Cup? Men

73% Followed 72,5% with better pleasure

BETTER THE SAME WORSE FOLLOWED WITH PLEASURE IT HAS BEEN AN OBSTACLE

WHAT IN PARTICULAR HAVE YOU LIKED ABOUT WORLD CUP RUSSIA?

Extremely + Very Much Adults 15-64 y.o. Men

Matches aired on free-to-air TV 91,7% 93,1%

Engaging commentators 77,5% 79,4%

Related TV shows 76,9% 72,5%

Chance to watch on other media (Web & Radio) 60,0% 61,6%

Commentaries by Gialappa's 58,4% 58,4%

Base 1.000 interviews - Marketing Research Publitalia ’80 in partnership with Open Mind

4 MEDIA TEAM PLAY: TV, RADIO AND DIGITAL. Matteo Cardani, who is also a member ces: Auditel linear TV data and digital A TOTAL AUDIENCE WORLD CUP of the Auditel board - we decided to esti- census data. Another key feature of the World Cup mate the total audience of the World Cup Overlaps have then being removed via on Mediaset was certainly the possibili- using our own approach (as some bro- daily panel interviews measuring the au- ty for the audience to follow the event adcasters around the World already did dience of each match, as well as via the via all media and all devices: TV & con- for big sporting events, including NBC passive measuring of GfK, which taps nected TV, web & mobile apps and, last Universal in the US and Discovery for the into people meter’s data of the panelists”. but not least, radio. 2018 Winter Olympics). All the above has allowed us to calcula- For a World Cup with loads of daytime We established rational guidelines to te the Total Audience of the event from matches it was crucial to oer viewers combine di erent audience data sour- 4 dierent perspectives. an ATAWAD oer: anytime, anywhere, any device. And so it has been - alongsi- de 120 live events on 4 national TV channels and a 24/7 follow-up of the event 1. The dynamic day after day building of the total reach of the event and the con- on Mediaset Extra and Premium Sport, tribution of live matches, related in-depth and entertainment TV coverage and the Mediaset deeply renewed its digital of- additional exclusive contribution of radio and digital. fering with the new Sport Mediaset and TOTAL AUDIENCE Mediaset FIFA World Cup apps, allowing for live streaming and catch-up (highli- ghts, clips, extra contents) of the whole TV SHOWS vs. LIVE MATCHES +5,7% CUMULATED event, with the possibility for the viewer COVERAGE ONLY RADIO & WEB vs. TOTAL TV +3,1% to watch and review the most impor- TV SHOWS vs. LIVE MATCHES +5,7% CUMULATED85% TOTAL vs. LIVE MATCHES +8,9% COVERAGE tant moments from up to 16 dierent ONLY RADIO & WEB vs. TOTAL TV +3,1% 33,2 85%MILLION TOTAL vs. LIVE MATCHES +8,9% perspective thanks to the “multicam” 33,2 MILLION feature. 85% 85,0% 75% 82,5% During the World Cup, the new online vi- 85% 85,0% 65% 78,1% deo app Mediaset Play launched on both 75% 82,5% 55% the rst screen (connected TV) and the 65% 78,1% 45% second screen on smartphone, tablet, 55% 35% as well as and desktop – combining the- 45% 25% 35% refore an enhanced TV experience with 15% 25% the mobile fruition of the event. 5% 15% -5% 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 5%June June June June June June June June June June June June June June June June June July July July July July July July July July July July July July July July

Finally, Radio 105 contributed with dedi- 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 -5% June June June June June JuneLive June June TV June matches June June June June June June JuneTotal June TV July Julyevent July July July July July JulyTotal July July Audience July July July July July cated programming, reportages and live Sources: Auditel and elaboration of data by Gfk – Target: Adults 15-64 y.o. audio simulcast with alternative com- Live TV matches Total TV event Total Audience mentary by popular comedy Trio Gialap- Sources: Auditel and elaboration of data by Gfk – Target: Adults 15-64 y.o. pa’s Band. 2. The audience composition among exclusive linear TV viewers, cross media A massive editorial and technological audience, and the contribution of exclusive radio listeners and digital users. endeavor, never put in place by a broadcaster for a FIFA World Cup before. EXCLUSIVE VIEWERS AND CROSSMEDIA VIEWERS ON AN AVERAGE DAY OF THE WORLD CUP This can be seen as the concretization of TOTAL REACH ADULTS 15-64 y.o.: 14.648.805 EQUAL TO 37,6% Total reach 37,6% = 100 what Alberto Brandi and Pierluigi Pardo DAILYTOTAL VIEWERS REACH ADULTS UNTIL 315-64rd JULY y.o.: 14.648.805 EQUAL TO 37,6% announced at the beginning of 2018 to Total reach 37,6% = 100 DAILY VIEWERS UNTIL 3rd JULY agencies and advertisers: “when Media- set takes over the production of a sporting Only event (be it the Giro d’Italia, Champions Web/Radio: Only TV Only League, or the World Cup), it takes it to (Auditel- 4,4% 623.667Web/Radio: reported):Only TV TV + other media: the next level and raises the bar for the (Auditel- 4,4% 623.667 competition”. 11.778.671reported): 80,4% TV 12,6%+ other media: Only TV Out-of-home: This eort has been rewarded by the to- 11.778.671 80,4% 1.852.19612,6% Only TV 2,7% 394.271 tal daily audience and total cumulated 1.852.196 Out-of-home: audience of the event. 2,7% 394.271 “While we wait for the ocial Total Audience single currency which of- cial metering panel Auditel should Sources: Auditel and elaboration of data by Open Mind (12.000 interviews) start publishing in a few weeks - says Sources: Auditel and elaboration of data by Open Mind (12.000 interviews)

5 3. Fruition choices by the dierent targets: an event that has developed over 80% of total coverage has reached everyone - adults, millennials, men and women - but in dierent ways: each target has chosen “its own media recipe” to enjoy the event. WORLD CUP: CROSSMEDIA CONSUMPTION STYLES

CROSSMEDIA ONLY TV ONLY RADIO & WEB

MEN: 17 million0,0% – 87,4% WOMEN 15-64 y.o.0,0%: 16,2 million – 82,7%

+14% (vs AD.15-64 y.o.) 36,0% 27,3%

59,7% 1,6% 71,1% +9% (vs AD.15-64 y.o.) 4,3% ADULTS 15-64 y.o. +43% TOTAL REACH:0,0% 85% (33,2 MILLION) (vs AD.15-64 y.o.)

31,5%

65,5% 3,0%

ADULTS 15-34 y.o.: 010,2 million – 80,1% ADULTI 35-64 y.o.:0 23 million – 87,6%

29,6% 32,5%

67,0% 64,8% +13% 3,4% 2,7% (vs AD.15-64 y.o.)

Sources: Auditel and elaboration of data by Gfk

4. The importance of the second screen in addition to the centrality of the rst screen: during over 4 weeks of World Cup, 49 million videos were viewed on the Mediaset websites and apps. An average of 1.4 million live streams per day, 74% of which were live matches, while 26% were video on demand. 6 million hours of additional video on top of the rst screen, a daily average of 210,000, increasing as the competition progressed to the nal stages.

WORLD CUP: STREAM VIEWS & TIME SPENT

TOTAL STREAMS 48,8 MIO TOTAL TIME SPENT 6,0 MIO HOURS

VOD VOD 12,2% 26,0%

LIVE LIVE 74,0% 87,8%

Average LIVE stream/day: 1,4 million Average time spent LIVE/day: 209.765

Source: Webtrekk

6 Very interesting to note is the correlation between rst and second screen au- the Autumn programming, this is the rst dience of the live event - as shown in the graph: as one grows, the other also sporting event that managed to repay grows, showing how content and technology can make of rst and second screen the rights with advertising alone, a sour- interaction a “positive sum game”. ce of satisfaction and pride for the entire WORLD CUP: 2ND SCREEN STREAM VIEWS & FIRST SCREEN AMR Mediaset group “.

Correlation coefficient: 0,74 WHAT’S NEXT? SPORT ON MEDIASET BEYOND Correlation coefficient: 0,74 THE WORLD CUP VIEWS .000 prime time daytime A question that many have asked

3.000 Stefano Sala is what will happen for Mediaset after the World Cup with 2.500 regards to sport broadcasting rights.

2.000 “I would simply say that the story continues, a success story started 38 years 1.500 ago with the Mundialito. On the day of the World Cup Final we announced the 1.000 agreement with Perform under which

500 Mediaset Premium Pay TV subscribers will be able to access the DAZN platform o er 0 (114 Serie A matches and the full Serie B). 0 2.000 4.000 6.000 8.000 10.000 12.000 14.000 Then, as far as the free-to air core business AMR .000 Target: Individuals Sources: Auditel and Webtrekk is concerned, our vision is clear - a great publisher cannot avoid dealing with sporting events, using a realistic approach, WORLD CUP ON MEDIASET: ROI FOR BOTH On this basis we built a commercial o er and seeking to acquire the rights where ADVERTISERS AND PUBLISHER. that allowed to allocate a specic position they can be contested and repaid - as it “Now that the World Cup is over, can we to each advertiser, throughout the whole has happened with the World Cup. make an economic assessment of the re- event. This has helped us to approach the This is our approach, an approach that turn on investment? “Of course - answers market with a straightforward and inno- “pays back” both with big scale events CEO Stefano Sala - but rst of all I would vative proposition. such as the World Cup and with extre- like to start from the return on investment This choice has paid, both before the event mely appealing events to specic indu- for our advertisers, the over 80 companies in terms of advertising revenues and after stries such as Formula E, which allows that have invested throughout the event, in terms of results for brands: we measu- us to work very well with the automoti- a number that rises to 150 if we also consi- red the spontaneous recall of the brands ve sector. In the meantime - even before der the companies that joined us half-way who advertised within live matches and the World Cup ended - we dened the into the event, attracted by its success. the results are above all benchmarks - a purchase of the free-to-air rights of the Our rst success is to have kept our promi- top event that has raised the top of mind rst-pick matches of the UEFA Nations se: estimating audiences of an event with awareness of those who believed in it “. League and of the qualifying matches no likes is no easy task, but it was impor- Last but not least is the return for the for the upcoming Euro and World Cups, tant and it was properly done, as it was Mediaset group: “As already announced from 2018 to 2021 - 40 games among conrmed by the actual results - this was by Piersilvio Berlusconi two weeks ago the best European national teams, the the rst promise we kept. on the occasion of the presentation of same ones that were the great prota- gonists of the World Cup just ended. UNAIDED RECALL OF ADVERTISED BRANDS We will begin to broadcast the rst 6 matches in September, October and Novem- ber this year, riding the positive wave of 128 BRANDS 128 RECALLED UNAIDED the World Cup, a global event that Media- set has been able to reinterpret in a total 1414 DIFFERENT CATEGORIES RECALLED ON AVERAGE and unique way”.

9 AVERAGE NUMBER OF ASSOCIATED BRANDS

Source: research by Publitalia/Open Mind, 2.400 interviews