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…welcoming new homeowners for 80 years Presentation by Management September 2008

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…welcoming new homeowners for 80 years

Presentationby

Management

September 2008

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Management team

CHRIS CAPEZZUTO General Manager

HELENE RICCINTO Vice President, Operations

MALCOLM SARNOVice President, Production and Fulfillment

MICHAEL FOLKS Vice President, Local Sales

MICHELLE GROVER Division Controller

ANTHONY ANCONA Director, Human Resources

DEBORAH HENRIKSEN Director, Marketing

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Agenda

Welcome Wagon’s Past, Present and Future

The New Mover Market

Product Overview and Opportunities

Sales Organization

Financial Overview

Growth Strategy and Path to Profitability

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Welcome Wagon’s 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 Wagon’s

Past

Present

Future

5

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Founded by Thomas Briggs in 1928 in Memphis, Tennessee

Briggs hired women as “hostesses” to welcome new movers to the neighborhood, on behalf of local merchants

Welcome Wagon was the pioneer of lead generation for local businesses

Welcome Wagon history

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Welcome Wagon was sold in 1995 to Cendant

In 1998, Cendant purchased Getting To Know You, a direct mail welcoming service

Later that year, Welcome Wagon’s business model was changed from home visits to direct mail

• Utilized the Getting To Know You product with the Welcome Wagon brand

• The delivery method changed; commitment to the mission did not

Cendant developed a new real estate search website called move.com

In 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 Wagon

Welcome 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 savings

Groundwork laid to achieve long-term profitability

On track to return to profitability in 2009 (EBITDA with Est. Corp. Costs), with full-year profitability in 2010

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

($1,000)

($800)

($600)

($400)

($200)

$0

$200

$400

Revenue $8,459 $7,625 $8,016 $7,889 $8,277 $9,095 $10,322 $8,899

EBITDA ($527) ($895) ($201) ($247) ($394) ($95) $225 $9

Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Q4 '09

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

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Welcome Wagon’s unique advantages

Experts in new mover industry and nation’s most trusted brand in reaching new homeowners

Nationwide local sales force of 250+

Single-source provider of direct marketing services to reach the new mover market

Fastest access to new homeowner data through vast network of county-level suppliers

Automated data processing system that verifies and scrubs new mover files

Highest mail list accuracy with 98%+ deliverability

In-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

environment XM Pie software, which drives our dynamic

publishing capabilities Technology experts in variable, on-demand

programming and application development Best-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 states

Staff of professional graphic designers who create custom ads for our clients

Technology department – experts in variable, on-demand programming; application development

Print production team with traditional and digital printing experience

Tenured and dedicated employees at all levels, in Plainview and in Field Sales

PASSION! Employees truly care about the products and the company and are vested in our success

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                                    After 80 years, we’re 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 population

On average, that’s 115,000 people each day

In 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-movers

Average spend is $9,400 in the first year

More likely to make major purchases due to credit worthiness and spending power

Have few to no loyalties – they will need ALL new local services and merchants

Source: High Point Associates, September 2006

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Welcome WagonProduct Overview

and Opportunities

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Our marketing solutions

Welcome Wagon’s suite of direct mail products helps businesses coordinate their marketing efforts to new residents at critical stages in the mover life-cycle

We mail 12 million pieces to movers annually, reaching over 4.5 million movers, on behalf of:• 12,000 small business clients• 30 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 Offer Many add a full-page display ad at

a higher rate

Sponsors pay per household mailed and sign a 12-month contract

Approximately 2,300 local editions of the Gift Book in 43 states

12,000+ current sponsors

Annual distribution: 1.5 million households

2008E 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 Book

Negotiation 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 Book

Repeats the “Welcome Offer” and reminds the mover to utilize the businesses

Provides a second opportunity for customer feedback

Annual distribution: 1.5 million

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EFY opportunity

EFY is currently a one-time follow-up mailer

Expanding 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 communication

Oversized postcard

Proven solution for targeting best prospects for our advertisers

Can be timed for optimal impact and frequency

Close to 400 designs in our library; customization also available

2008E 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 movers

The distribution is comprised of:• 1.5 million through our standalone Post-Move mailer• 1.5 million via inserts into the Gift Book

2008E 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 2004 Re-launched with improvements in

2007• Reached profitability within a few

months In Q4 2007, lost national sales

support and profitability slipped Due to lack of revenue, Pre-Move

was decommissioned in June 2008 2008 revenue (actual for Q1 & 2):

$150,000

Opportunity: This product has great potential Advertiser appeal and few

competitors Once a national sales channel is

assembled, this product can be reinstated for a quick “win”

Mr. & Mrs. John Doe123 Main StreetAnytown, US 12345

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A division of Welcome Wagon, GDR sells the company’s 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 easily obtain on their own

• Supplies approximately 280,000 new mover names per month or 3.4 million annually

2008E revenue: $1.1 million

Opportunity: Expect current profitability to continue

New mover data

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Getting To Know You

Getting To Know You is a new direct mail product, designed to reach new movers:

• Solo mailer – only one business per envelope

• Brightly colored envelope with a personalized letter inside

• Mailed to ALL movers, including home buyers, home renters, apartment renters, etc.

• Can be sold in any available zip code

Getting To Know You has launched in July 2008 with 7 categories

Anticipated 2008 revenue (Q3 & 4): $700,000

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Getting To Know Youopportunities

Customized version for national advertisers

Telesales to expand reach across entire U.S.

Expanding to additional categories

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welcomewagon.com

The local business directory built

for “movers”

Featured placement for Welcome Wagon partners

Keyword and category searches, link to client’s website, client’s special offer

Map and driving directions with business location flagged

Customer recommendations

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“Hello Welcome Wagon” alpha website

Visit – and help create – their “virtual” neighborhood

Get the “inside scoop” from the locals on things to do, local sites, events

Meet the neighbors

Make recommendations, browse those made by others

Post questions and answers

Share photos

Opportunity: Build upon $1 million investment already

made

Create a “must visit” site that retains eyeballs long after the move

Local neighborhood “social networking” site that allows consumers to:

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Sales Organization

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Sales organization

2 Trainers

256 Total Sales:

223 Account Execs

2 Trainers

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Regions

Each region consists of 6-8 districts

Quota breakdown:

• Northeast: 26%

• Mid-America: 26%

• American South: 28%

• Western: 20%

RVP key responsibilities include hiring and managing District Managers, developing and executing regional sales strategy, overseeing sales training, assisting with larger sales deals and setting pricing strategy

RVP compensation: salary + override of regional revenue with accelerators if goals are achieved

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Districts

28 districts made up of an average of 10 sales territories

Annual sales quotas range from $900,000 to $2 million

DM key responsibilities include hiring, training and managing Account Executives, handling customer service issues, developing and executing a district sales strategy and overall motivation and development of their team

DM compensation: salary + monthly override for achieving district quota

Introducing a variable compensation plan in August, which will replace all DM fixed-cost salary comp plans

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Sales territories

363 active territories within 43 states

8 - 12 books are assigned per AE

Monthly quota for a territory runs between $8K to $16K

AE key responsibilities include prospecting potential clients, contracting new clients, renewing existing clients for Welcome Wagon’s suite of products sold to local business advertisers and handling customer service calls• Requires a 1:1 “sales consulting” approach to position

WW as a marketing solution as opposed to simply selling ad space

AE compensation: 100% commission/bonus plan; commission ranges from 20 – 25% of net revenue + quarterly and annual bonuses

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Key sales challenges

Current turnover is 55% • Skewed higher by certain territories

However, we retain our top performers (COEs), demonstrated by a 5.3 year average tenure• Those who are successful make great income and stay

longer

Continuous efforts to lower turnover include revamping AE comp plan, significant training changes

Current renewal rate is 27%• This number reflects the inherent nature of small

businesses • COE rates are significantly higher (40%)• Consistent with historical performance

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DNA of a successful AE

Self-motivated

Highly competitive

Resilient

Sales experience preferred

Financially driven

Thrives on recognition

Entrepreneurial

HR’s contributions supporting Field and Plainview operations…

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Sales force enhancement initiative

WW management strongly supports introducing a multi-level marketing structure to expand sales force with additional pay-for-performance compensation

Designate top AE candidates as “Super AEs” (based on performance/tenure)

Super AEs may recruit, hire and train part-time reps to sell within their territory • Allows the Super AE to build their own team and grow into more

book areas• Provides Super AE with an override from their “downline” reps

Benefits: Super AE hand-picks their team, can grow into more

territories

DM earns additional revenue without having to hire, train and mentor

Part-time AEs benefit from a flexible position, working with a friend or neighbor, earning some spending money

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Financial Overview

Growth Strategy and Path to Profitability

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Financial Overview – past and present

Year Ending December 31Source: Management

$ % $ % $ % $ % $ %Revenue:

Local (Gift Book + EFY) 30,302,822 79.2% 32,599,909 78.8% 30,105,079 80.6% 24,915,371 77.9% 24,915,371 77.9%Pinpoint Postcards 2,554,463 6.7% 3,912,961 9.5% 3,453,943 9.2% 3,794,200 11.9% 3,794,200 11.9%National Post-Move 2,269,533 5.9% 2,419,783 5.9% 1,991,242 5.3% 1,327,438 4.1% 1,327,438 4.1%Data 2,011,521 5.3% 1,611,199 3.9% 1,317,427 3.5% 1,091,182 3.4% 1,091,182 3.4%National Pre-Move 1,119,129 2.9% 817,438 2.0% 497,003 1.3% 153,754 0.5% 153,754 0.5%New Products 706,993 2.2% 706,993 2.2%

Total Revenue 38,257,468 100.0% 41,361,289 100.0% 37,364,694 100.0% 31,988,938 100.0% 31,988,938 100.0%Growth 8.1% -9.7% -14.4%

Total Cost of Goods Sold - Adjusted 14,832,604 38.8% 16,609,460 40.2% 13,937,712 37.3% 13,871,018 43.4% 13,451,348 42.0%Gross Profit - Adjusted 23,424,864 61.2% 24,751,830 59.8% 23,426,982 62.7% 18,117,920 56.6% 18,537,590 58.0%

Operating Expenses:Sales and Marketing 18,393,142 48.1% 20,864,517 50.4% 18,574,812 49.7% 14,450,968 45.2% 13,701,081 42.8%General and Administrative Expenses 8,251,456 21.6% 9,356,220 22.6% 8,170,146 21.9% 7,947,981 24.8% 6,673,106 20.9%Product Development - Adjusted 67,525 0.2% 34,793 0.1%

Total Operating Expenses - Adjusted 26,644,597 69.6% 30,220,738 73.1% 26,744,957 71.6% 22,466,473 70.2% 20,408,980 63.8%

Adjusted EBITDA (3,219,734) (5,468,908) (3,317,975) (4,348,553) (1,871,389)

(1,212,733) (2,510,554) (915,885) (2,539,544) (1,121,389)

Pro Forma 2008

Statements of Income

Adjusted EBITDA before CorporateCosts (See Schedule 4)

Actual 2005 Actual 2006 Actual 2007 Estimated 2008

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Future – path to profitability

Year Ending December 31Source: Management

$ % $ % $ % $ % $ %

Revenue:Local (Gift Book + EFY) 24,915,371 77.9% 24,915,371 77.9% 26,908,601 73.5% 29,061,289 71.3% 31,386,192 71.2%Pinpoint Postcards 3,794,200 11.9% 3,794,200 11.9% 4,173,620 11.4% 4,590,982 11.3% 4,590,982 10.4%National Post-Move 1,327,438 4.1% 1,327,438 4.1% 2,500,000 6.8% 3,000,000 7.4% 3,400,000 7.7%Data 1,091,182 3.4% 1,091,182 3.4% 1,100,000 3.0% 1,100,000 2.7% 1,000,000 2.3%National Pre-Move 153,754 0.5% 153,754 0.5% 500,000 1.4% 1,000,000 2.5% 1,200,000 2.7%New Products 706,993 2.2% 706,993 2.2% 1,412,000 3.9% 2,000,000 4.9% 2,500,000 5.7%

Total Revenue 31,988,938 100.0% 31,988,938 100.0% 36,594,221 100.0% 40,752,271 100.0% 44,077,174 100.0%Growth -14.4% 14.4% 11.4% 8.2%

Total Cost of Goods Sold 14,262,143 44.6% 13,451,348 42.0% 15,076,820 41.2% 16,022,648 39.3% 16,471,066 37.4%

Total Gross Profit 17,726,795 55.4% 18,537,590 58.0% 21,517,400 58.8% 24,729,622 60.7% 27,606,108 62.6%

Operating Expenses:Sales and Marketing 14,450,968 45.2% 13,701,081 42.8% 14,684,339 40.1% 15,133,307 37.1% 15,488,627 35.1%General and Administrative Expenses 7,556,856 23.6% 6,673,106 20.9% 7,947,981 21.7% 7,768,887 19.1% 6,768,887 15.4%Product Development 67,525 0.2% 34,793 0.1% 199,007 0.5% 249,007 0.6% 499,007 1.1%

Total Operating Expenses 22,075,348 69.0% 20,408,980 63.8% 22,831,327 62.4% 23,151,201 56.8% 22,756,521 51.6%

EBITDA as Reported (4,348,553) (1,871,389) (1,313,926) 1,578,421 3.9% 4,849,586 11.0%

(2,539,544) (1,121,389) 495,083 1.4% 3,387,430 8.3% 6,658,595 15.1%

EBITDA as Standalone (Estimated Corporate Costs) (3,289,544) (1,871,389) (254,917) 2,637,430 6.5% 5,908,595 13.4%

* Pro Forma adjustments include cost reductions implemented in the second half of 2008 annualized over the full year and estimated costs to replace functions currently provided via corporate allocations.

Projected 2011

Path to Profitability

EBITDA before Corporate Allocations

Estimated 2008 Projected 2009 Projected 2010Pro Forma 2008 *

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Path to profitability (implemented in 2008)

Renegotiated pricing agreements for certain supplies and services

New AE commission plan (reduced training and travel expenses,

unrecoverable draw)

Reduced number of samples Negotiated alternative mailing

solutions with USPS to reduce postal rates

Reduced headcount by 23(includes overhead) since Jan 2008

Outsourced appointment setters and telesales Reduced fixed headcount by 13

$655,000

None $100,000

$300,000

(annual cost savings)

$45,000 $1,170,000

$15,000 $500,000

None

None

Initiatives Costs Benefits

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Path to profitability (in projections)

Initiatives Costs Benefits

Create a dedicated national sales channel (for Gift Book, Pinpoint and

Post-Move mailer)

Ties sales compensation directly to sales revenue in 2009 and beyond

(2008 = $350,000)

Incremental $3 million in revenue by 2011

Ramp up to $500,000 by 2011

Introduction of new products (e.g., multi-touch mailing)

Enhancement of existing products (e.g., Pinpoint)

Institute variable compensation plan for District Managers

Reduce facility expense (enabled by outsourcing)

Sublease in 2009 & 2010; lease buyout in 2010

Cost savings:2009 = $200,000 (approx.)

2010 = breakeven2011 = $1 million

Introduction of multi-level sales strategy

Revenue enhancement:2009 = $2,400,0002010 = $2,600,0002011 = $2,800,000

Revenue enhancements:2009 = $500,000

2010 = $1,000,0002011 = $1,500,000

< $10,000

$200,000(IT and upfront costs)

< $100,000+ commissions

$1,000,000 buyout in 2010

Outsource all production and mailing operations

Increase in out-of-pocket costs for production of book ($0.50), offset by corresponding staff reductions

Equipment sale = $700,000

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Path to profitability (not in projections)

Initiatives Costs Benefits

Invest in new online order entry and publishing system

$700,000Cost savings:

$900,000 annually

Invest in web development; possible integration of welcomewagon.com

and Hello Welcome Wagon sites

Move has invested $1 million in the Hello Welcome Wagon website; additional investment depends

upon scope

Significant local business directory + social networking site = increased traffic =

advertising dollars = revenue gains

Active solicitation of new mover email addresses to enable development of

an email product

3rd party Email Service Provider + promotion investment

New revenue channel

Suspension of lower-value Books

NoneIncrease average

book value; more cost efficiencies

Outsource new product development

Partner with direct mail experts in consumer redemption to improve results tracking on behalf of clients

$50,000 Improved renewal rate will enhance revenue

TBDExpand our current resource capabilities

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Conclusion

Local businesses will always need to find new customers

Welcome Wagon has proven to be a highly effective lead generation partner for those businesses

The Company’s unparalleled expertise in the robust new mover industry will continue to enable the development of increasingly valued products

• We have a proven track record in bringing new products to market and ongoing product enhancement

Welcome Wagon is in an ideal position to “own” the new mover space – via both print and online – with the right partner and resources