Emotions Trump GadgetsLevi Shapiro, India Gadget Expo, June 19, 2014

The Future of Digital?

Apple Thinks So

First…let’s Talk About the Glass Ceiling

Multi-modal Competition

Ecosystems Compete on Cross-Screen Experience

Global annual unit sales (m)

1,000

750

500

250

0

PCs

1,250

1997 1999 2001 2003 2005 2007 2009 2011 2013e1995

Smartphones and tablets

0

Apps are eating the world

Source Flurry

Aug ‘12Mar ’11 Jan ‘12

80%Of time on mobile is

spent in apps

140

120

60

40

20

0

100

80

160

Apps

Mobile web

Total min spent on mobile apps vs mobile web (billions of minutes per month, US)

Min

ute

s sp

ent

per

month

(b

illio

ns)

Messaging is a Mobile Ecosystem

Source: comScore Mobile Metrix, US March 2013

2011 2012 2013 2014

Dollars Follow Eyeballs- FB Mobile Revenue

Mobile Desktop

59%Mobile Revenue

in 2014

0%Mobile Revenue

in 2011

Facebook revenue by source

$2.5b

Q4

$3.0b

$1.5b

0

$1.0b

$0.5b

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Mobile

Advertising

Payments Advertising

$2.0b

Q1 Q2 Q3 Q4

2010 2011 2012 2013

$2.6b

Engagement EnableseCommerce

WeChat Ecosystem Value Capture

Hardware as a Tool to Sell Digital Content

Glide’s Technical Edge

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E 2016E 2017E 2018E0

1,000,000,0002,000,000,0003,000,000,0004,000,000,0005,000,000,0006,000,000,0007,000,000,0008,000,000,0009,000,000,000

10,000,000,000

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Personal Computers (Desktop And Note-

book)

Smartphones

SmartphonesSmartphonesSmartphonesSmartphonesSmartphonesSmartphonesSmartphonesSmartphonesSmartphonesSmartphones

SmartphonesSmartphones

SmartphonesSmartphonesTablets

Tablets Tablets Tablets Tablets Tablets TabletsTablets

TabletsTablets

TabletsTablets

TabletsTablets

TabletsSmart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Connected/Smart TVs

Wearables

WearablesWearablesWearablesWearablesWearablesWearablesWearables

WearablesWearables

Wearables

Wearables

Wearables

WearablesWearables

Global Internet Device Installed Base Forecast

# O

f Dev

ices

(In

Mill

ions

)Its Not Just Mobile (eMarketer, 2013)

The Magpie effect

Offline Economy is Becoming “Appified”

• Massively contextual- Transactions are Incremental

• Your 2nd brain knows better than you do

• Wallet accessed through your mobile and gatekeepers

Neural Measurement

Source: Professor Nathan Intrator , TAU

Hey Cookie…You Talkin’ To Me?

WelcomeLevi

Web

Mobile

Context

NEXTGEN

Hours spent watching video monthly

5

12

9

33

8

Sou

rce:

Mas

habl

e, J

uly

2012

, Li

near

TV

Nie

lsen

11/

12

NON-LINEAR VIDEO VIEWING NOW EXCEEDS LINEAR TV

BRIDGING THE GAP

What Millenials Want…In Their Employer

1.Training

2. Management style

3. Work flexibility (time is currency)

4. Staff activities

5. Non financial rewards (Activism)

6. Good salary

#1 priority: “sense of meaning”

(Career Advisory Board, Harris Interactive study, 2012)

“In 2009, there were 2.5 billion connected devices. In 2020, there will be  50 billion, most of which will be products.” (Gartner, 2013)

Millenials seek gadgets & experiences

reflecting their values: Inclusive,

Personal,Relationship-based

https://www.youtube.com/watch?v=OTwJI0f8c1s

Israeli Brand: Magisto

https://www.youtube.com/watch?v=y_7yoEUrVhw

Israeli Brand: Waze

https://www.youtube.com/watch?v=5wh6BoTBx2w

Israeli Brand: JINNI

http://www.youtube.com/watch?v=OlvjzQJGDnY

Nivea

https://www.youtube.com/watch?v=UYy1GmJgFXA

Nivea (2)

https://www.youtube.com/watch?v=iMrZmSPpIRw

Motorola

https://www.youtube.com/watch?v=IIpMtWeXCaE

Heineken

https://www.youtube.com/watch?v=yyRgQJzILus

Vittel Water

https://www.youtube.com/watch?v=sjvSqDPrjGk

This is your Moonshot

Can Your Gadget Encapsulate Noble Brand Values and Yet be Freemium?

Freemium Products

• ZERO marginal cost of distribution• Low inherent conversion rate• Large scale / large total addressable market• Continuous monetization curve• Minority of highly engaged users

Characteristics of Freemium Products

• No switching cost• LTV difficult to calculate• Much larger potential audience (everyone can afford free)• Network effects easier to achieve• Advertising not as abrasive• Multiple points of monetization

Lifetime Customer Value (LTV)

• Present value of future cash flows from user• What individual user can be expected to pay• Can be aggregated over various dimensions (demographic

characteristics / early user behavior)• Marketing metric

Misunderstanding LTVLifetime Customer Value is NOT Linear or Immediate

*usually. An LTV evolution curve could theoretically be linear.

Misunderstanding LTVLifetime Customer Value is NOT Linear or Immediate

*usually. An LTV evolution curve could theoretically be linear.

Misunderstanding LTVLifetime Customer Value is NOT Linear or Immediate

*usually. An LTV evolution curve could theoretically be linear.

v

QUESTIONS?•••