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Copyright 2003 ECNext
Stratfor and ECNext 2003 Recapand
2004 Opportunities
Mike PerkinsChief Technology Officer
Pam SpringerVice President, Sales
Rob ReachSenior Account ExecutiveECNext, Inc.(614) 408-0067
January16, 2004
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
Who We Are
• Founded in 1996 in Columbus, Ohio
• VC funded– Athenian Venture Partners
– River Cities Capital Funds
• Founded as a content aggregator – Built sophisticated platform & tracking capabilities
– Worked with over 500 publishers to market content
• Leveraged aggregator model to evolve to build customer branded e-commerce solutions
• ECNext provides services and technology enabling our customers to sell their valuable business information on the Web
• We market to companies who create and sell high-value business research, reports, news, analysis, and data
Copyright 2003 ECNext
Benefits we provide for our Customers
• Generate new revenue by reaching net new Web buyers– Successfully exploit Web as new direct sales channel
• Broaden market reach– Tailor & size offerings to meet range of customer needs
• Cross-sell new buyers to other offerings– Keep your message in front of them
– Bundles, promotions, incentives
• Increase repeat buyers– Discontinue access in a pre-defined timeframe
– Increase subscription by automating renewal promotion
• Decrease production & distribution costs
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
Current Terms
• Contract:– 18 month term
– $2,500/mo license, customer support and hosting fee
– $2,500/mo for hosting former Plug-n-Pay customer database
– $3.00/year for new subscriber ($.25/mo)
• Recent Add on (10/03 – 3/04):– $4,000/mo for 40 hours/month custom development; (5 month
retainer)
Copyright 2003 ECNext
2003 Highlights
• 2003 Sales of $1.6 Million
• Sales Increased 400% Q3 over Q2 $372,626
• Sales Increased 260% Q4 over Q3 to $972,059
• October Sales were $388,997
Copyright 2003 ECNext
Financial Results
Feb-03 Mar-03 Apr-03 May-03 Jun-03 Jul-03 Aug-03 Sep-03 Oct-03 Nov-03 Dec-04 YTD Totals
Stratfor Gross Sales 51,154 166,137 56,119 22,268 15,827 38,871 182,828 150,927 388,997 320,062 263,000 $1,656,190 $1,656,190
ECNext Fixed Income Mo Maint Fee - Non Legacy customers2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 2,500 $22,500 Mo Maint Fee - Legacy Customers 1,250 2,500 2,500 2,500 2,500 2,500 $8,750 Mo Develop & Prod Sves Retainer 4,000 4,000 $0
2,500 2,500 2,500 2,500 2,500 3,750 5,000 5,000 5,000 9,000 9,000 $31,250ECNext Variable Income Subscription Fees 1,796 4,985 1,101 376 324 502 3,203 448 453 660 $13,849 Monthly Retainer Overage 763
1,796 4,985 1,101 376 324 502 3,203 448 453 1,423SUBTOTAL ECNext Income4,296 7,485 3,601 2,876 2,824 4,252 8,203 5,448 5,453 10,423 9,000 45,099 $45,099
Chargebacks 50 184 354 474 120 (476) 3,101 5,728 20,974 25,879 19,716 $76,104
Copyright 2003 ECNext
Financial Results
Stratfor/ECN Monthly Sales 2003
0
100,000
200,000
300,000
400,000
500,000
Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Copyright 2003 ECNext
Financial Results
0%
20%
40%
60%
80%
100%
Feb Apr Jun Aug Oct Dec
Relative Revenues vs. Costs
Stratfor Net Sales
ECN Costs
Copyright 2003 ECNext
Financial Results
Chargeback Threshold
$(5,000)
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
2% of Sales
Actual Chargebacks
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
Timeline Monthly Support Calls
Support Calls
0
50
100
150
200
250
300
Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Support Calls
Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total50 99 139 129 154 138 54 255 111 99 55 1,283
Copyright 2003 ECNext
Timeline
Q1 Q2 Q3 Q4Iraq war site built End of qtr changes in contacts Plug & Pay DB Cutover Retainer establishedEstablished Customer feed to Developed and delivered Sales Admin Tool Modified Landing pages for Basic
Take transactions while Created custom transaction reports Modified Landing pages for PremiumStratfor provided access delivered daily and set up to go self serve Modified auto renewal
Set up a content site Training on the Pub Tool for Marla's team Trial Corporate Account set upDual sites running content Validating Customer lists with DB's Changes to Sales and Account ModuleProvided Stratfor with the Pub tool Email campaigns
Reconciliation Audit-extensive no cost to StratforRadio silence
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
2004 Stratfor Goals and Expectations
• Revenue
• Organization
• New Products
• Email Campaigns
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
eContent Market OverviewIncreasing Use of the Web
“Our research on the information habits of users in various functional roles and industries shows that 79 percent of users turn first to the open Web for work-related information.”– Outsell
• Search engines are starting point for business searches– 79% of searches start here
– 70% of info delivered online
Copyright 2003 ECNext
Market OverviewMarket Size
• $11B in individual business information purchases over previous 12 months– 22% of buyers spent $10,000 or more
– Median of $1,500
• Additional $35.5B in purchases out of the departmental budget
*Source: Outsell, Super I-AIM
Copyright 2003 ECNext
Market OverviewBusiness Drivers
• Fewer $ for corporate-wide information purchases– Slowing economy
– Budget cuts for corporate librarians, research dept’s
• Fewer corporate-wide buyers– Consolidation of tier 1 companies (e.g., pharmaceutical, chemical,
automotive)
• New markets are harder to reach– Many small, new companies
• Need for information not going away
• Individual transaction buying increasing
Copyright 2003 ECNext
Market OverviewShifting Buyer Behavior
• Decentralization of Information Purchases – 68% of business end-users prefer to find their own information
– Only 3% will call the corporate librarian
– Only 25% will visit the corporate library
• 51% of content purchases driven by end-user decision– Purchased information typically satisfies tactical, project-oriented need
– Decisions requiring approval are typically made by a functional Director or VP
• Purchase Size– 34% have purchase authority for $5,000 or more
– Median purchase authority is $1,000
*Source: Outsell, Super I-AIM
Copyright 2003 ECNext
How internet users find web sites
77%
42%
30%
22%
3%
SearchEngines
Links
Off-lineAdvertising
Banners Source: Dick Morris survey for iProspect
Copyright 2003 ECNext
1.70%
2.00%
2.40%
4.00%
4.40%
4.50%
4.80%
9.90%
18.40%
27.60%
28.90%
29.50%
Look Smart
Earthlink.com
Lycos
AltaVista
Netscape
Infospace
Overture
Ask Jeeves*
AOL*
MSN**
Yahoo*
Search engine audience reach
Source: Nielsen NetRatings for SearchEngineWatch.com
* powered by Google ** powered by Inktomi
Copyright 2003 ECNext
The search engine opportunity…
• A potential customer on a mission to find critical business information opens a search engine and enters key words…
• Your site is listed first in the results. He doesn’t know about your business, but assumes that since you are highly ranked he should learn more…
• He clicks the link to your site and opens directly to one of your articles– the description is on target – he clicks to buy.
40% or more of your online content sales can be driven directly from search engines.
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
ECNext SolutionsBeyond SEO – Content Illumination
Definition of Content Illumination: SEO techniques applied to web site on a page-by-page basis (e.g. product pages)
Objectives:
Bring potential content buyers from search engine directly to point-of-sale– Direct potential content buyers to a relevant product page
– Eliminate the need for the buyer to search site to find information
– Minimize the number of clicks-to-purchase
Copyright 2003 ECNext
Standard ECN Customer Metrics
• Search Engine Related Revenue
• 1.5% overall site conversion rate
• 3 x search engine site conversion rate (4.5%)
• Over 400% increase site traffic after 4 months (with SEO & Content Illumination programs)
• 50% Average Year over Year revenue growth for ECN customer
• Due to ECNext integrating at the Stratfor site subscription sign up page, these metrics and programs are not applicable. Hosting Stratfor content would make these available.
Copyright 2003 ECNext
ECNext Solutions Summary
• Search engines are the key tool for business users to find information on the Web
• SEO and Content (Article) Illumination are very cost-effective tools for bringing traffic to business e-content sites
• Targeted Content (Article) Illumination programs help drive traffic and increase conversion rates by:– Bringing potential content buyers directly to the point-of-sale
– Minimizing the number of clicks-to-purchase
• Adding this functionality into the Stratfor solution will drive additional sales
Copyright 2003 ECNext
InfrastructureHosting, Security, Maintenance, Redundancy
Business IntelligenceTest, Measure, Analyze, Report & Refine
DemandGeneration
Search Engine Optimization- Site optimization- Content Illumination
Email Campaigns
Affiliate Programs
Industry Links
Print Campaign Tracking
Trials
Content Management
Publishing Tool
Automated Source Data Feeds
Data Formatting- Segment- Index
Outbound XML (Web Services)
Aggregator Feeds
eCommerce Transactions
License Options - Pay-per-view- Subscription
Payment Options- Credit card- Pre-paid- Bill me
Promo Options- Bundling- Discounts- Cross-sell related items
Tracking and Reporting
Activity Tracking- Visits / Transactions- Revenue- Cart abandons
Customer Database
Lead Database
Subscription Management
Usability Studies
Operations & SupportEnd-user Help Desk, Credit Card Billing and Reconciliation
Making eContent Work for You
Additional Modules Available: Telesales Corporate Acct. Mgt.
Multicurrency Personalization Conference Sales Ad Server
Stratfor Solution (currently utilized)
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00
Copyright 2003 ECNext
Demand Generation & Site Optimization
• Search Engine Visibility• Website Usability Testing & Improvement• New Features• Direct Marketing
Copyright 2003 ECNext
1. Top-level SEO• Website-level visibility for relevant, frequently-
used keywords phrases
2. Current event SEO• Visibility to highly relevant, topical landing pages
3. Article page illumination• Visibility to individual articles
Search Engine Visibility Initiatives
Copyright 2003 ECNext
Search Engine Visibility: Top-level SEOHomepage
About us
Current Keywords (daily searches):• Strategic forecasting (2)• Predictive intelligence (0)• Global intelligence (10)• Strategic intelligence (20)• Geopolitical analysis (3)• Geopolitical forecasts (0)• Intelligence services (19)• Geopolitical intelligence (2)• Business intelligence (351)• Issues intelligence (0)• Intelligence briefs (0)
Other Valuable Keywords:• International business
risk (33)• International business
news (171)
Red = Stratfor currently ranks high
Current searches: 53
Potential additional searches: 558
Note: “international” searched more heavily than “global”
Copyright 2003 ECNext
Search Engine Visibility: Top-level SEO
• Keyword analysis is necessary, but not sufficient for search engine visibility
• Also requires:• Appropriate placement of keyword phrases• Ensuring page structure is search engine “crawlable”• Keeping abreast of changes to each search engine’s
ranking methodology
Copyright 2003 ECNext
Search Engine Visibility: Current event SEO
• Landing pages quickly developed & live for breaking events
- Template- “Cocked and ready”- Tailored to drive subscriptions- Pay-per-click keywords purchased to drive
immediate, highly-relevant traffic
Copyright 2003 ECNext
Search Engine Visibility: Article page illumination
• Unseen, intermediate landing pages for each article- SEO friendly- Keyword rich- Redirect to the Stratfor article page
• Experience shows this increases traffic by 4x.• Article page must be optimized to convert searches
into subscriptions
Copyright 2003 ECNext
Website Usability Testing & Improvement• User Testing
- Obtain detailed, qualitative feedback about how to improve site
• Surveys- Pop-up survey to visitors when certain events occur (e.g.,
subscription is not completed)• A/B Testing
- Implement site changes, often based upon User Testing & Surveys, and quantitatively assess the impact on shopping & purchasing behavior
- Live, side-by-side comparison- “let the customer decide”- E-commerce best practice
Copyright 2003 ECNext
Website Usability Testing & Improvement: AB Testing
Subscribe Now!
E.g., Article Landing Page:
• User test feedback: shopper’s unclear how to subscribe• Proposed change: Large “subscribe now!” button on article page• AB test: Randomly 50% of visitors receive version A & 50% receive version B• Metrics analyzed: average subscriptions started & completed per visitor
Copyright 2003 ECNext
Website Features• “My Stratfor”
- Allow existing subscribers to customize their view of the Stratfor site
- Organize sections based on personal relevance- E.g., Yahoo vs. My Yahoo
Copyright 2003 ECNext
Email & Direct MarketingTypes of Programs
• Subscriber renewal programs– Email renewal promo is built into ECNext solution
• Automated based on renewal date
• Configurable Number & timing
• Registration / promotion programs– Capture registrations on site
– Promote subscriptions
• Subscriber acquisition programs– Email & DM to purchased lists
– ECNext provides tracking and execution support
Copyright 2003 ECNext
Email Marketing
End-to-end Tracking
Analysis & Reports
Track program metrics
- Email opens
- Site traffic
- New subscribers
- Subscriber retention
- Revenue
Test programs
- List performance
- Promo offers
- Creative & message
Execution
Set tracking codes
Stage creative
Manage customer list
Manage mailing list
- In-house list
- Rented lists
Send emails
Process opt-outs & bounce backs
Program Planning
Plan program
- Target audience
- Define offers
- Creative
Develop creative
- Message
- Design
Acquire lists
- Research
- Negotiate
Project management
ECNext’s subscriber acquisition program support
Stratfor’s marketing activities
Copyright 2003 ECNext
Opportunities
• SEO & Article Illumination
• eMail Campaigns
• Ad Servers
• XML Feeds
• Personalization by end user
• Tracking, Reporting & Monitoring
Copyright 2003 ECNext
Agenda-ECNext and Stratfor 10:00-12:00 January 16, 2004
• Introductions 10:00-10:10
• 2003 Recap and Metrics 10:10-10:30– Financial
– Timeline
• 2004 Look Ahead 10:30-11:00– 2004 Stratfor Goals & Expectations
– 2004 Econtent Market
– 2004 ECNext Solutions
• 2004 Stratfor/ECNext Opportunities 11:00-11:30
• Platform 11:30-11:40
• Next Steps 11:40-12:00