INVESTOR DAY

May 9th, 2018

Market Trend
Innovation inevitable upon digitalization

“Degree of Digital Disruption”

1st Stage 2nd Stage 3rd Stage
• Operational Efficiency • Service Differentiation (O2O, Customized SVC) • Enhanced competitiveness of digital players
(Cost-Cutting, etc) • New players with digital-only business • Traditional players under the threat
(Macy’s, Toys R Us, Comcast and etc.)
Tech Media
Telco

Retail

Banking “Digital Giant”

Insurance

Auto
Airlines
Hotels
Education
Medtech
Transport/Logistics
Healthcare
Construction Mining Utilities Pharma Consumer products
Oil & Manufacturing
Gas
Market Trend
Value of premium content & trendy commerce rises

Content Provider Distributor

(Avg. hours of media consumption per capita per week)
“Digital Commerce Giants’ Content Investment”
“Digital viewership Digital 22hrs 45% 39hrs
39hrs
forecasted to be 70% $9.0 bn+
double that of Live (2017-2018E)
TV”
TV
27hrs 16hrs
$7.2 bn+
(2017-2019E)
2016 2025F

revenue ($bn) $8.5 $15.0 $1.9 “Vertical Platform - Global Success Story”
“Expand mega- Commerce 95% 49% 36%

IP commerce
revenue”
Box Office

Cars Harry Potter Frozen

Why We Merge
1
Pre-emptive Response Toward Global Trend through
Strengthening Premium Content & Trendy Products

2
Business Innovation through
Content & Commerce Synergies

3
Secure Global Growth Driver through
New Digital Cross-business
No. 1 Content Creator
Premium content to expand users’ Time-share/Mind-share

Media Music Pictures Digital

7,500+ 2,500+ 20+ 25 bn

Hours Songs Movies Views
/ Year / Year / Year / Year
No.1 Content Creator - Growth Strategy
Drive IP-based business model and overseas expansion

Revenue Model “Global Top-tier Content Provider”

Expansion

2 Diversify IP-based business model 4 Drive overseas expansion

Maximize content value with diverse IP (N.A., SEA)
& commerce-integrated business 5 Foster E-sports/animation
(Synergy)

1 Create strong IP, home and abroad 3 Strengthen digital content

Strengthen unrivaled IP competency Discover digital content IP & digital
Focus on securing global mega IP business model to lead future content market

Content Category Expansion

No. 1 Commerce Leader
Unique shopping experience to expand users’ time-share/mind-share

Live TV New Media Global GMV

Commerce (DADA Studio) Business

650+ 8.5mn+ 6+ 4.4 tn

Brands Followers Countries KRW
No. 1 Commerce Leader - Growth Strategy
New business and market expansion upon product competency

“Beyond Homeshopping”
Value Chain
Expansion

2 Strengthen portfolio 4 Expand in overseas market

Differentiate product & brand Expand global presence
Strengthen exclusive brand(beauty, living) with new business model

1 Strengthen No.1 market position 3 Drive new business model

Strengthen TV business competency Expand DADA, Secure new media channel,
Collaborate with DIA TV
Synergy
Channel Expansion
 Merger Synergy
Create new growth opportunity • New business upon
content & MD
Accelerate
−Vertical Platform
New Business
−Digital Content Studio
• Diversify BM upon content IP
−New homeshopping format
−MD/brand solution Strengthen Synergy
• Sufficient capital for investment Competency

Operational • Cross-data analysis

Efficiency
• Remove overlapped
investment
Business Outlook
W11.4tn Merger Synergy
W1.4tn
. New business 57 %
- Content/IP, Vertical Commerce
. Existing business synergy 43 %
W6.5tn 75% W5.9tn
(GMV)
- V-Commerce, Digital Ad, Animation

Legacy and new

W4.4tn businesses to drive
(GMV) sales

W4.1tn Content
W2.1tn
Commerce

2018E 2021E Synergy

※ Sales forecast for Commerce is based on GMV(Gross Merchandise Volume)