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  • welcoming new homeowners for 80 years

    Presentation

    by

    Management

    September 2008

  • *

    Management team

    CHRIS CAPEZZUTO

    General Manager

    HELENE RICCINTO

    Vice President, Operations

    MALCOLM SARNO

    Vice President,
    Production and Fulfillment

    MICHAEL FOLKS

    Vice President, Local Sales

    MICHELLE GROVER

    Division Controller

    ANTHONY ANCONA

    Director, Human Resources

    DEBORAH HENRIKSEN

    Director, Marketing

    *

  • *

    Agenda

    Welcome Wagons Past, Present and FutureThe New Mover MarketProduct Overview and OpportunitiesSales OrganizationFinancial OverviewGrowth Strategy and Path to Profitability

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    Welcome Wagons mission

    Help local businesses connect with new residents at a critical time when they are spending money and developing new loyalties

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  • Welcome Wagons

    Past

    Present

    Future

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    Founded by Thomas Briggs in 1928 in Memphis, TennesseeBriggs hired women as hostesses to welcome new movers to the neighborhood, on behalf of local merchantsWelcome Wagon was the pioneer of lead generation for local businesses

    Welcome Wagon history

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    Welcome Wagon was sold in 1995 to CendantIn 1998, Cendant purchased Getting To Know You, a direct mail welcoming serviceLater that year, Welcome Wagons business model was changed from home visits to direct mailUtilized the Getting To Know You product with the Welcome Wagon brandThe delivery method changed; commitment to the mission did notCendant developed a new real estate search website called move.comIn 2001, Move, Inc. (then called Homestore), bought the move.com website along with Welcome Wagon, hoping for synergistic benefits

    Welcome Wagon history

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    Synergies never materialized between Move and Welcome WagonWelcome Wagon fell short of its potential due to lack of dedicated resources and focus from corporate management, as well as limited investment in infrastructure, promotion and product development Over the past year, the current WW management team has developed solid growth and profitability plans The team is excited to pursue opportunities with a new owner

    Welcome Wagon present

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    Welcome Wagon looking forward

    Initiatives requiring limited investment have begun, including a combination of enhancements and cost savingsGroundwork laid to achieve long-term profitabilityOn track to return to profitability in 2009 (EBITDA with Est. Corp. Costs), with full-year profitability in 2010

    2008 and 2009 Quarterly Revenue and EBITDA Projections ($000)

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    Welcome Wagons unique advantages

    Experts in new mover industry and nations most trusted brand in reaching new homeownersNationwide local sales force of 250+Single-source provider of direct marketing services to reach the new mover marketFastest access to new homeowner data through vast network of county-level suppliersAutomated data processing system that verifies and scrubs new mover filesHighest mail list accuracy with 98%+ deliverabilityIn-house production and USPS plant-verified facility

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    Welcome Wagon resources technology

    Headquartered in Plainview, NY

    We employ cutting-edge technology:

    2 Xerox iGens in a variable print-on-demand environmentXM Pie software, which drives our dynamic publishing capabilitiesTechnology experts in variable, on-demand programming and application developmentBest-in-class data research, collection and scrubbing processes

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    Welcome Wagon resources - people

    372 employees, including approximately 256 local sales representatives in 43 statesStaff of professional graphic designers who create custom ads for our clients Technology department experts in variable, on-demand programming; application developmentPrint production team with traditional and digital printing experienceTenured and dedicated employees at all levels, in Plainview and in Field SalesPASSION! Employees truly care about the products and the company and are vested in our success

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    After 80 years, were part of American culture

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    The New Mover Market

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    New movers: a constant supply

    Each year, approximately 19 million American households (42 million people) move to a new home

    This represents 16% of the US populationOn average, thats 115,000 people each dayIn 5 years, nearly 80% of the population will move

    Source: U.S. Census

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    New movers: a lucrative target

    Moving triggers a wave of expenditure on
    move-related products and services

    This spending yields a staggering
    mover-related industry of approximately

    $170 Billion

    annually in the U.S.

    Source: High Point Associates, September 2006

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    New movers:

    desirable demographics / psychographics

    New homeowners spend 20 times more on household goods and services than non-moversAverage spend is $9,400 in the first yearMore likely to make major purchases due to credit worthiness and spending powerHave few to no loyalties
    they will need ALL new local services and merchants

    Source: High Point Associates, September 2006

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    Welcome Wagon

    Product Overview and Opportunities

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    Our marketing solutions

    Welcome Wagons suite of direct mail products helps businesses coordinate their marketing efforts to new residents at critical stages in the mover life-cycleWe mail 12 million pieces to movers annually, reaching over 4.5 million movers,
    on behalf of:12,000 small business clients30 national clients

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    Our flagship product: the Gift Book

    Businesses sponsor their category in the
    Gift Book (dentist, dry cleaner, pizzeria) with business listing and Welcome OfferMany add a full-page display ad at a higher rateSponsors pay per household mailed and
    sign a 12-month contractApproximately 2,300 local editions of
    the Gift Book in 43 states12,000+ current sponsorsAnnual distribution: 1.5 million households2008E revenue: $ 25.0 million

    (includes EFY)

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    Gift Book revenue by category

    0.3%

    0.3%

    0.9%

    2.7%

    2.9%

    3.8%

    5.7%

    5.4%

    7.8%

    8.3%

    14.9%

    20.6%

    26.5%

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    In progress (pilot launch Q4 2008): addition of sponsored local content to each book, providing information on parks, beaches, recreation areas, schools, town and county municipal offices, photos

    Gift Book opportunities

    Regional and national corporate ads in the Gift BookNegotiation with companies to develop franchise programs, co-op plans for their distributors

    Other opportunities:

    A dedicated national sales team or outside sales firm would enable two opportunities:

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    90 days after the Gift Book: EFY

    Especially For You is a self-mailer booklet, mailed to the same movers who received the Gift BookRepeats the Welcome Offer and reminds the mover to utilize the businessesProvides a second opportunity for customer feedbackAnnual distribution: 1.5 million

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    EFY opportunity

    EFY is currently a one-time follow-up mailerExpanding EFY to a 3x (multi-touch) mailer would provide a marketing opportunity to reach new movers at critical points after they move: 3 mos. as they are first discovering their new home 6 mos. as they begin to settle in 9 mos. as they complete the process and now feel

    truly at home

    Enables better opportunity for more targeted and relevant messaging

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    Pinpoint postcards

    Personalized one-on-one communicationOversized postcardProven solution for targeting best prospects for our advertisersCan be timed for optimal impact and frequencyClose to 400 designs in our library; customization also available2008E revenue: $3.8 million

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    Pinpoint opportunities

    Enhanced version of product that leverages XMPie, allowing elements of the postcard design to be highly personalized to the recipient Build out demographic/
    psychographics to provide
    more client options

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    Post-Move insert program

    Welcome Wagon provides a channel for large, national businesses to reach 3 million moversThe distribution is comprised of:1.5 million through our standalone Post-Move mailer1.5 million via inserts into the Gift Book2008E revenue: $1.3 million

    Opportunity:
    Add a dedicated national sales channel to increase revenue

    Mr. & Mrs. John Doe

    123 Main Street

    Anytown, US 12345

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    Pre-Move insert program

    Initiated in 2004Re-launched with improvements in 2007Reached profitability within a few monthsIn Q4 2007, lost national sales support and profitability slipped Due to lack of revenue, Pre-Move
    was decommissioned in June 20082008 revenue (actual for Q1 & 2):
    $150,000

    Opportunity:

    This product has great potential Advertiser appeal and few competitorsOnce a national sales channel is assembled, this product can be reinstated for a quick win

    Mr. & Mrs. John Doe

    123 Main Street

    Anytown, US 12345

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    A division of Welcome Wagon, GDR sells the companys mover data files either directly or via list brokers to large marketers (e.g., banks/credit card companies, housewares/electronics, catalogers, etc.)GDR has a reputation of consistently supplying names that others cannot quickly or