annual report 2010 Our MissiOn The inTeracTive adverTising Bureau is dedicated to the growth of the interactive advertising marketplace, of interactive’s share of total marketing spend, and of its members’ share of total marketing spend. engagement showcase to marketing influencers interactive media’s unique ability to develop and deliver compelling, relevant communications to the right audiences in the right context. accountability reinforce interactive advertising’s unique ability to render its audience the most targetable and measurable among media. operational effectiveness improve members’ ability to serve customers—and build the value of their businesses—by reducing the structural friction within and between media companies and advertising buyers. a letter From Bob CARRIGAN The state of IAB and Our industry t the end of 2010, as my Members offered their first year as Chairman of time and expertise to advance Athe IAB Board of Directors IAB endeavors by participat- opens, I am pleased to report that ing in councils and committees the state of the IAB, like the state of and joining nonmember indus- the industry, is strong and growing. try thought leaders on stage to In 2010, IAB focused more educate the larger community than ever on evangelizing and at renowned events like the IAB unleashing the power of interac- Annual Leadership Meeting, MIXX tive media, reaching across all Conference & Expo, and the new parts of the media-marketing value Case Study Road Show. chain to find the common ground on which to advance our industry. Focused on the Future Simultaneously, the organization In 2011, IAB recognized the held true to its long-term mission of strength of its executive team engagement, accountability, and by promoting Patrick Dolan to operational effectiveness. Executive Vice President and As we move into the organiza- Chief Operating Officer, David tion’s seminal 15th year, we have Doty to Senior Vice President and plans for remarkable accomplish- ership gatherings for the indus- ment across all digital media. Chief Marketing Officer, and Mike ments, many of which you will read try. Twenty-ten was also a year of Throughout the year, IAB Zaneis to Senior Vice President about on the following pages. internal growth, in which the IAB dedicated its resources to mini- and General Counsel. After a decline in 2009 expanded its presence by opening mizing friction in the buying and I look forward to leading the and a slowing pace of growth a West Coast office. selling of online media. In June, organization into 2011. IAB is in 2008, our industry is flourish- Indeed, 2010 saw IAB IAB released the Networks & poised to deliver the most excit- ing again. While full-year figures enhance its centrality to the entire Exchanges Quality Assurance ing and results-focused year in its are not yet available as we go to marketing and advertising eco- Guidelines to ensure transparency history. You can see on the follow- press, the industry’s 2010 third- system. The organization stood and consistency in ad network and ing pages the six-point strategy, quarter revenue of $6.4 billion in Washington, D.C., to cham- exchange operations, which 16 entitled Digital Everywhere, that set a new record high, accord- pion consumer privacy protec- member companies have already IAB will pursue. Among the most ing the IAB Internet Advertising tion and defend our businesses pledged to adopt, and issued the exciting adventures for the year Revenue Report conducted by against deleterious legislation final version of Standard Terms & are the launch of the IAB Ad Lab, PricewaterhouseCoopers. and regulation. The IAB Privacy Conditions 3.0 to expedite con- a new industry meeting ground Matters public education cam- tractual negotiations for the most where creatives and technolo- Tracking Broader Growth paign and the implementation of common types of interactive gists, device manufacturers and Trends the Advertising Option Icon pro- media buys. software developers, publish- IAB itself joined the industry in gram—developed and supported IAB efforts to overcome sup- ers and agencies, marketers and experiencing a year of gratify- by a vast, cross-industry alli- ply-chain friction and boost the thought leaders, start-ups, and ing upswing, in membership, in ance—demonstrated our indus- marketplace extended to the media titans can come together to dues revenues, and in revenues try’s ability to work together to burgeoning mobile platform. In discuss, debate, demonstrate, and from its events business, enabling protect consumer privacy and collaboration with the Mobile network under the banner of IAB. the organization to pursue its stra- ensure the vitality of the interac- Marketing Association (MMA), You have my pledge that IAB tegic mission of supporting the tive advertising market. we released standards for mobile will continue to foster growth for growth of interactive media. IAB marketing measurement. IAB all its member companies, and for ended the year with 426 gen- Change Through deepened its commitment to the the industry at large, in 2011. I look eral and associate members, Collaboration space by launching the IAB Mobile forward to working with the Board an increase of 15 percent from IAB worked closely with many Marketing Center of Excellence, of Directors, IAB members, and the 2009. Small-publisher participa- trade organizations through- whose mission is to drive the industry to advance our common tion surged, with 388 new Long out the year, and most recently development of mobile advertis- interests—and to having a lot of Tail members. cultivated the support of the ing through research, best prac- fun in the process. Dues hit just over $6M, a 6 per- American Association of tices, and evangelism. cent increase from plan, and events Advertising Agencies (4A’s) This year IAB also engaged contributed $5M, up 37 percent and the Association of National agency creatives on its Agency from plan. The IAB’s events busi- Advertisers (ANA) for the Making Advisory Board and in the Rising ness also cemented its reputation Measurement Make Sense initia- Stars competition, asking them to Bob Carrigan for producing conferences that tive. That venture is charged with tell us which ad formats they’d like Chairman serve as the central thought lead- devising a business solution to to see standardized in 2011—for- IAB Board of Directors one of the most perplexing metrics mats that will inspire effective and issues: how to create consistent, breakthrough brand advertising Chief Executive Officer transparent, and reliable measure- within interactive media. IDG Communications AnnuAl Repo Rt 2010 1 2010: The year aT iaB Financial growth as the “great recession” subsides ollowing two years of strong Revenue from membership is $1.350M, or 37 percent, over for our nonprofit trade organiza- economic headwinds, IAB in dues came in 6 percent over plan. This expansion in event tion and represents an increase F2010 experienced a period budget. This gain came from the attendance required greater of $500,000 from the reserve’s of growth. A broad, albeit uneven, broadening of our Associate tier, expenditures, which is visible size at the end of 2009. IAB has recovery in the advertising mar- with 57 new industry-supportive in the difference between our dedicated the remaining balance ketplace and the expansion of members, and our Long Tail mem- planned and actual expenses. of the surplus to the development ad-supported digital media com- bership category for small pub- At the end of the year, our of the IAB Ad Lab, the formation panies allowed for growth in lishers, which saw skyrocketing revenues exceeded our bud- of the IAB Mobile Marketing cross-industry membership and participation and ended the year get to produce a surplus of Center of Excellence, and other our events business. This allowed us to strategically invest in initia- tives and projects that would raise financial Key indicators for 2010 membership value and add a level (‘000) of much-needed financial security 2010 2010 Var from Var From to our operations. Actual Budget Budget $ Budget % We planned our 2010 bud- get cautiously, aware that the Dues revenue $ 6,175 $ 5,825 $ 350 6% financial turbulence of the period EvenTs revenue $ 5,000 $ 3,650 $ 1,350 37% might not have been ready to sub - side. We trimmed our planned Total expenses $ 10,814 $ 9,759 $ 1,055 11% expenses and our expected rev- enue from events, while slightly Gain (Loss) $ 859 $ 0 $ 859 658% upping our budget for membership dues revenue. But as the year pro- with 388 members, up from 92 in $859,000, bringing our net asset strategic investments that will gressed, our performance began 2009. Our general membership, total to $968,000. Of this fig- increase our utility to members to outpace those conservative dedicated to sellers of advertis- ure, $609,000 is being held in a and help us maintain our cen- expectations. ing inventory, showed a minor reserve. This is a prudent measure tral position in encouraging the decrease of 2 memberships. advancement of the interactive Our events business bene- advertising industry in 2011 and fitted from the brighter economic beyond. outlook and our proven track record of must-attend, high- quality events. Attendance and sponsorship income contributed $5M of top-line revenue, which 2010: The year aT iaB iab membership by type: 2010 / 2009 Total Members: 2010 236 190 388 814 2009 238 133 92 463 0 200 400 600 800 General Associate Long Tail iab membership by revenue: 2010 General 88% Associate 11 % Long Tail 1% events record year All Events FY 2010 2010 Events 5,000 Revenue (Dollars 3,497 ‘000) 2010 6,173 Events Attendance 5,032 0 2,000 4,000 6,000 2010 2009 3 2010 highlighTs 2010: The year at IAB y identifying and leveraging the common Self-Regulatory Principles for Online threads that connect all segments of the media Behavioral Advertising marketing ecosystem, IAB in 2010 redoubled B The year’s work culminated on October 4, when its resolve to make significant advancements for all the Digital Advertising Alliance (DAA)—a collab- its member organizations and the interactive indus- oration among IAB, the American Association of try as a whole.