DECIDING WITH CONFIDENCE

Supporting Business Development Research

C2ER June 7, 2012

Chip Rogers, Director of Business Development, D&B State & Local Government

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I. Review of Dun & Bradstreet – World leader of business insightII. Economic Opportunities in State and Local GovernmentIII. HooversIV. How our other Economic Development Clients are using MI – BDP’s

a. Integration of client / customer data – MI MEDCb. Customizing MI with Industry Clusters – NY Empire State Developmentc. Prioritization using predictive scores – Florida Chamber Foundationd. Regulation – CA Air Resource Boarde. Export Initiatives – LA Regional Export Council

V. Questions

Agenda Topics

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D&B clients have access to nearly 100mm active businesses around the world, to fuel it’s economic growth initiatives

23 M

11 M

725K

7.1 M

400 K

43 M

D&B & the Global Economy

~

1.5 M

Deeper Economic Development analytics and benchmarking Building an Economic Development Strategy based on business community potential Research & Development of key industry targets / Company profiling and segmentation Track and document performance (e.g. business migration, job creation, etc) International Trade Initiatives that impact Foreign Direct Investment

For over 170 years, D&B has been providing business insight and today is tracking over 200M* business locations globally

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Global Data Collection

Entity Matching

D-U-N-S® Number

Corporate Linkage

Predictive Indicators

Trade Data (7K sources)

Court & Legal Filings

Business Internet Data

Business Regis./UCC Filings

Newspapers & Publications

Telephone Interviews

Company Financials

Other Public – ie AMS & govt

Banking Information

Patented process to ensure data

collected is mapped to the right

business

Most recognized unique identifier for

a business site globally.

Customs & Homeland Security requirements have

DUNS requirements

Globally tracking close to 15M

records that are linked through

Parent and Child relationships.

Statistically based models to predict future business

outcomes. COTS Commercial Credit

Score and Financial Stress

Score

* Includes all inactive D&B records

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• In 2011, D&B tracked almost 50,000 Businesses who moved from one state to another• The highest concentration of activity was in CA, TX and FL

• There are Huge opportunities To Improve the Fortunes of your State/County/Municipality by bringing in the RIGHT Business• Higher paying jobs• Larger Tax Base• Positive Impacts on Commercial and Residential Real Estate

• There is also Peril in this Economic Endeavor• Some Businesses do not deserve your investment in Time, Resources and

Incentives• Will they take the incentives and not be around a year from now?

Economic Opportunities in State & Local

• Currently 30% of States use D&B for Economic Development Programs• We expect that % to almost double in the next Two Years• We are best suited to help you:

• Acquire• Retain• Service• Grow

• We Can help you answer:• What is the Demographic Breakout of our Market/State/County, etc?• What businesses should we target for incentives to move to our Market?• Who in State needs our help?• Who should we avoid?

D&B and Economic Development

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• Having access to a Full Suite of Demographic Data on all Businesses will help you understand your current market as well as your Strengths and Weaknesses

• SIC/NAICS• DIVERSITY STATS• EE RANGES

• Combine the Demographic Profile Data with Employment Data on your Workforce Resources and you have a “Good Start”

• Add to the mix, Credit Worthiness of a Firm(s) and you limit your exposure

• Understand your Goals and Targets

• Query from a Tool that gives you access to Business Data, Contacts and Titles within the Your “Targets” and you can Proactively engage in Economic Development Activities

Data will assist you in your ED Efforts

A Best Demonstrated Practice for State and Local Economic Development is to utilize a full toolset of D&B solutions to revolutionize their Economic Development initiatives

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Analyze Global Marketplace – Combining internal information with D&B information to understand key business

characteristics to aid in finding expansion wins– Measure success of retention, expansion & attraction programs

– Develop key business clusters and profiles to determine new in-state opportunities for expansion/retention and domestic/global opportunities for expansion

– Generate targeted outreach lists for Business Development Specialists

Business Profile for Call Preparation – Deep dive on company and industry to prepare for client meetings– On demand list generation

Industry Analysis for Call Preparation – Helps BDS associates understand complete picture of industries of interest

– Competitive benchmarking

Assess Risk of Businesses – Monitor Tier 1 State businesses for deterioration and intervention

(retention/expansion)– Complete financial condition of business – Call Prep

– Prioritize activity based on business risks and opportunity– Final “underwriting” to ensure State resources are appropriately awarded

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Hoovers provides a Full Researching Tool

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Hoovers can assist with the following:

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• D&B Market Insight is a quick-to-implement, cost-effective marketing application empowering you to profile your State, build Grade A target lists, and make smarter marketing decisions

• Integrates your internal information with demographic profiling data from D&B in a hosted solution

• With a wide range of descriptive and predictive analytical tools, Market Insight’s analysis options are virtually unlimited

• Offers the functionality and performance that marketers need with an architecture that is easy for IT to adopt and support

• Integrates with CRMs, MDMs and ERP’s

D&B Market Insight Overview

• The Financial Stress Score predicts the likelihood that a company will experience one or more of the following conditions over the next 12 months, based on the information in D&B’s files: Obtaining legal relief from creditors, Ceasing business operations without paying all creditors in full, Voluntarily withdrawing from business operation, leaving unpaid

obligations, Going into receivership or reorganization, or Making an arrangement for the benefit of creditors

• D&B suggests using a FSS of 1-5 within MI to help target worthy businesses for retention and for recruitment

When Targeting Companies, Do not forget Credit Worthiness!

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• Gain more insight on the demographics of your state by overlaying the in-depth data D&B holds on those businesses

• Identify businesses that:• Should be recruited• Should be retained

o Are they a large employer?o Big Tax Revenue Generator?o Do they Fit a niche industry profile that is important to us?

• Need Financial assistance• Are growing – D&B will provide 3 and 5 year trends• Businesses not worthy of your time, attention and investment

o Poor Credit Risko Likely to “Close Doors” within a Yearo Looking for Incentives to stay AFLOAT

Market Insight will provide you with a comprehensive, detailed view of your marketplace, so you can make smarter marketing decisions

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Within the Market Insight application, you have access to a custom marketing database built and managed exclusively for you

• Your prospect universe can consist of more than 35 million business records globally linked records or more than 100 million businesses around the world

• D&B updates its global database each month without interruption to service• Easy Download • Market Insight has Professional Contacts = Database of almost 20 million

people• Email and Direct Dial• Search Database by Title

• Market Insight allows for Integration into SFDC

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D&B Market Insight: Data visualization tool that allows Clients to see and interact with D&B’s local and global business data

Market Insight gives you the ability to create interactive charts, graphs and maps to present your data in an understandable and interesting format.

• Export dynamic charts and graphs straight to Excel, Word or PowerPoint

• Perform radius selections of businesses, drive-time analyses and route planning within the map function

Note: The visual illustrated above requires the use of Microsoft MapPoint which is not included

Illinois

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Explore a companies global corporate family tree within Market Insight

Nobody builds more corporate family trees than D&B, and nobody offers the depth and breadth that we do. Corporate linkage can open up untapped opportunities by identifying decision-making locations and non-buying family members within your customer’s enterprise.

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Let’s look at a Real Use Case

State Industry Analysis using Financial Stress Score

• We took a view of businesses in Oklahoma

• Then only asked for Manufacturing Companies

• Then we asked MI to analyze them by:• Employees at that Location and• by Financial Stress Score

• The result is a breakout of the Oklahoma Manufacturing Sector by Size and Financial Stability

Analyze for Market or your Potential Market

Produced using D&B Market Insight 18

Unclassified

0 - OUT OF BUSINESS, BANKRUPTCY, HIGHER RISK

1 - LOW 2 3 4 5 - HIGH TOTAL

No Data or 0

17 1 8 98 174 309 8 615

1 - 4 93 9 20 1,075 1,910 2,027 134 5,268

5 - 9 23 5 14 456 443 293 42 1,276

10 - 14 9 1 19 169 200 167 20 585

15 - 19 6 0 12 97 89 94 13 311

20 - 29 10 0 7 102 137 136 13 405

30 - 49 4 1 13 83 143 120 11 375

50 - 74 3 0 13 54 70 71 8 219

75 - 99 3 0 6 35 51 35 4 134

100 - 199 4 2 10 51 72 57 1 197

200 - 249 0 0 1 15 14 10 0 40

250 - 499 1 1 2 24 45 26 0 99

500 and over

3 0 1 13 11 22 1 51

TOTAL 176 20 126 2,272 3,359 3,367 255 9,575

Produced using D&B Market Insight 19

Chart View of Spreadsheet “Who would you Target?”

• Company profiling and segmentation – MI enables the analysis and profiling of businesses by a combination of D&B elements, e.g. by SIC or NAICS code, employee size and sales volume.

• Access to Deeper Economic Development analytics and benchmarking – In addition to providing business intelligence on all companies, MI also provides access to 100 million domestic US or Global businesses for querying and developing market reporting and analytical scenarios to drive growth initiatives.

• Building an Economic Development Strategy based on business community potential – MI provides the ability to identify and rank the potential of businesses based on similarities to your targeted high growth areas. By adding some basic selection assumptions you can analyze companies to determine profitability for a given campaign

• International Trade Initiatives – D&B Market Insight not only houses a complete list of US businesses, but also contains all D&B Worldbase companies - foreign businesses linked to affiliates in Your State. You will have a detailed view of corporate family linkage for targeted trade and Foreign Direct Investment objectives

• Tracking/Merging/Suppression of previous campaigns – MI allows for easy tracking of companies used for specific programs so that successful campaign populations can be mailed to again and previous responders suppressed. Also, several populations or waves of responders can easily be combined for analysis to refine targeting criteria for future campaigns

Typical states will use D&B’s Market Insight solution (MI) to facilitate the research and development needed to effectively administer initiatives to maintain and grow business activities within the State

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• Top Employer Lists - generated in MI based on the total amount of employees and the opportunity for growth (report created with in conjunction from other economic development sources such as annual budget book). High growth employers are then targeted for participation in business development programs

• Tax Program - MI used to identify target businesses affected by a new tax, provide them education through outreach and help enforce compliance.

• Environmental Quality campaigns - through targeted outreach programs and education on new standards and compliance. States are able to help proactively meet EPA regulations & requirements, and help businesses before they potentially run into trouble (for example, generating a contact list of dry cleaners that require strict adherence to a new hazardous chemical disposal regulation). The results are seen through aggregate growth in the industry and the improvement of employment statistics within your State

• Workforce Development - through the identification of high growth industries using MI, and the placement of individuals in related occupations.

Some examples of where States currently utilizes D&B’s Market Insight solution (MI) to facilitate research with a goal of maintaining and growing business activities within their State

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• MEDC uses D&B information in conjunction with their CRM system, to track performance of business entities working with their business development team, measuring changes in number of employees, sales volume, financial stability, etc. – very important in reconciling their current and future incentive funding.

• The Market Insight tool is used to capture a statistical “snapshot” of information for these businesses through a monthly download process. Control groups are categorized by incentive date, program name, region, etc. with trending information developed over time.

• Pure Michigan Business Connect Economic Gardening Pilot Program for second stage growth companies is a focus area for MEDC in 2012, where future Economic Gardening programs are expected to expand significantly (focus on second stage companies with 10-99 empls and $1-$50mm sales).

• D&B continues partnering with MEDC in 2012 through the deployment of its Market Insight analytics tool, in the area of Retro-analysis projects to track predictive indicator and demographic data points (combined with statistical performance) over time, Economic Gardening projects, and various Export initiatives focusing on business attraction & export assistance.

Case Study #1 : Integration of client & customer data – Michigan Economic Development Corp

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• NY ESDC currently uses the information obtained from D&B’s Market Insight, for longer-term and other more strategic ad-hoc reporting to build and feed a monthly Dashboard that is used by all 10 New York state Regions. D&B built a custom variable to allow easy segmentation by NY Region

• Related specifically to their Regional Economic Development Council, D&B’s Market Insight is currently helping ESDC prepare specific reporting and recommendations for each of the 10 Regions, and was one of the authoritative sources of information to submit the 5-year plan submitted last November 2011. D&B’s primary goals in this partnership is working with ESDC to identify and incorporate ESDC data into Market Insight that supports ESDC’s mandate to develop a Business Climate Report due to the Governor’s office December 31, 2012.

• One of the critical elements used to present results is an Industry Cluster – D&B also built this custom variable using a pre-defined list of NAICS codes, allowing easy segmentation for their reporting needs

Case Study #2 : Customizing MI with Industry Clusters by Region – NY Empire State Development

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• The Florida Chamber Foundation functions as a research organization and problem solver working closely with The Florida Chamber of Commerce and the Florida Office of Trade, Tourism, and Economic Development (OTTED). The objective of all three organizations is to advance and promote a healthy Florida economy with a Point of Arrival being reached by 2030.

• The objective for D&B’s Market Insight system is to enhance the Florida Chamber Foundations research and analysis capabilities. It’s success will be measured by the Foundations ability to: Provide data access for all state constituents, identify trends and measure how well businesses do over time. Primary measure of success will include loading 4 indicators they’ve created, using data pulled from Market Insight, into their Florida Scorecard, such as

• # Business Relocations• 2nd Stage Firms (Gazelle Companies)- Classified by industry and defined as: Under 99 employees, having

under $50m in sales, 100% growth over the last 3 years, • Florida Industry Financial Health Score and a Small Business Risk Score are both generated using D&B’s

Financial Stress Score (FSS) to predict the likelihood of business discontinuance over the next 12 months

Case Study #3 : Prioritization using predictive scores – Florida Chamber Foundation

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• CA Air Resources Board (CARB) has a mission to promote and protect public health, welfare and ecological resources through the effective and efficient reduction of air pollutants while recognizing and considering the effects on the economy of the state. CARB is responsible for reducing Greenhouse Gas emissions through innovative regulatory programs and clean-air technologies. Regulations must be fair for California businesses, result in a tangible reduction of GHG, be measureable and enforceable through compliance and monitoring, and foster economic growth in California.

• CARB currently leverages the D&B Market Insight solution to support these research and enforcement activities. Market Insight provides CARB with a comprehensive database of all businesses in the United States to perform impact analysis on upcoming regulations and enforcement programs.

• Working in partnership with D&B, CARB has tailored the Market Insight application to create a unique solution specific to environmental quality in the state of California. This solution becomes even more powerful with each research program or enforcement activity integrated within Market Insight.

• The following projects have been initiated and are either ongoing or have been completed using MI: Low Income Analysis, Business moves into and out of the State of California, Air Toxicity, Diversity among Auto Dealers, Emitting Facilities, Prototype of Electrical Spend models, Air Quality Districts

Case Study #4 : Regulation– CA Air Resources Board

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• The Export Council is a collaboration of regional export service organizations including seven key partners: The Los Angeles Mayor’s Office, the Los Angeles Area Chamber of Commerce, the Centers for International Trade Development (CITD), the USC Center for International Business Education and Research (CIBER), the UCLA Center for International Business Education and Research (CIBER), the Port of Los Angeles, and Los Angeles World Airports

• Primary mission is to identify and expand the number of businesses conducting export activities• LA’s primary goal is to double regional export levels in five years by expanding access to market

research, streamlining export services, and providing networking opportunities for export-ready companies

• To increase exports and accelerate Trade Connect, Market Insight will help LA Port and LAWA’s target the most attractive firms for outreach, programs, and seminars 50 miles from the Port/LAX or across the United States

Case Study #5 : Export Initiatives – LA Regional Export

Council

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• By utilizing 3rd Party Business Data and Tools you can:• Find the right businesses to retain• Find the right businesses to recruit• Find the wrong businesses for recruitment and AVOID them!• Become a revenue generating arm of your local and state

government

In closing…….

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Chip Rogers, Director of Business Developmentrogersc@dnb.com(954) 396-6997

Tim Gray, Government Customer Managergrayt@dnb.com

D&B Contact Information