The first question RBC asks is basically, what is the TAM? Of course, we are mainly talking about digital marketing spend in the US. According to RBC, the digital marketing spend in the US in 2016 was US$73bn, and that is forecast to grow to US$119bn by 2020.
The overall CAGR here looks to be around 11%. Not bad!
So what about the market segment UPD operates in? RBC estimates the TAM will reach US$10bn over time. This is based largely on the digital market spend of large corporations in the electricity, pay TV, internet and insurance verticals, who spend US$20bn annually on marketing, with digital marketing reaching 50% of this within a decade.
As well as the above verticals, the general marketing spend of moving services needs to be factored in.
US$10bn. That is a sizable market opportunity to go after, no doubt.
And how are they tracking?
Basically, 7 years and US$50m building the platform and establishing reach. Reach is currently 18% of all US movers, with a near term target of 35%. 99% retention of real estate contracts, the driving force behind the business.
2018 is tagged as the year of monetization. CY 2018- US$19-23 revenue estimated, with the RBC estimate at US$21.8. That's a lift of 876%.
And the competition? Basically a San Francisco co called 1stopmove.com, which offers limited services, and is not distributed through real estate agents.
Other than that its the old style scatter-gun approach of google ads, leaflet drops, telemarketing, etc.
Oh yes, and then there's always facebook. They look after their propriety data pretty well, I'm sure.
Anyway- that's enough from me for a Sunday night! I think the RBC report is pretty solid, well researched stuff. More on this later.
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