CONFIDENTIAL

Capturing the full potential of DM within the telecom sector 360° Impact survey

2

Player A Direct Mail Pilot Results

KEY MESSAGES

Belgian Post and Player A have together conducted a market research among 1800 Player A‘s-customers on a campaign promoting Player A’s new Product to existing customers (cross selling).

The market research was conducted during the second half of 2005 on three target groups:– clients who were exposed only to an Above-The-Line campaign (reference group)– clients who received a Direct Mail – clients who received an e-mail (on an active e-mail account)

The market research shows that:

– Direct Mail increases consideration and intention to buy vs e-mail + ATL and ATL only leading to highest purchase rate.

– Net campaign impact of e-mails was positive for customers with active e-mail account, net campaign impact of Direct Mail was positive on all existing customers targetted.

– Direct Mail shows higher recall rates than e-mail and ATL media except TV. (existing ATL campaign ongoing during market research)

– Content recall for Direct Mail is 83% higher than for e-mail.

– Direct Mail and e-mail were better perceived than ATL.

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Player A Direct Mail Pilot Results

PILOT SETUP

Target customers

Media-mix

Market Research

Methodology

Campaign goals •Prompt sales of new product

•Existing customers

•DM+ATL

•E-mail +ATL

•ATL only

•1800 phone interviews

Cross-selling

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Player A Direct Mail Pilot Results

*Discounted for certainty in responses: 80% of ‘certainly’ and 20% of ‘yes, maybe’ answers taken into account**Actual subscription rates measured on 10,000 potential subscribers per media group; Source:Market research on 1800 Player A’s existing customers.

DIRECT MAIL INCREASES CONSIDERATION AND INTENTION TO BUY vs. E-MAIL+ATL AND ATL ONLY, LEADING TO HIGHEST PURCHASE RATEPercentage of respondents (80/20)*

Direct mail has highest impact throughout product funnel

ATL + DM 100 12.112.1 7.159 4 1.3

ATL only 100 9.59.5 5.552 4 0.8

ATL + Email 100 9.79.7 5.557 5 1.2

Product funnel

Product awareness

Consideration to buy*Consideration to buy*

“Do you know Product?”

“Would you consider switching to Product in the coming year?”

Considerationto buy*

Consideration to buy*Consideration to buy*Intention to buy*

“Do you intend to switch to Product in coming months?”

Consideration to buy*

Actual subscription rate**

+29%+29%

+1%+1%

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Player A Direct Mail Pilot Results

DIRECT MAIL INCREASES CONSIDERATION TO BUY ON ACTIVE AND INACTIVE E-MAIL ACCOUNTS Percentage of respondents

Direct mail increases ‘consideration to buy’ on both active and inactive E-mail accounts vs. ATL only (+33% and +10% respectively)

E-mail increases ‘consideration to buy’ of active E-mail users vs ATL only (41% vs 36%)

ATL + DM

ATL only

ATL + DM

(212)

(208)

(378)

100

100

100

48

41

45

48

41

45

ATL + e-mail (519) 100 41 41

Product funnel

Product awareness

Consideration to buy*Consideration to buy*

“Do you know Player A’s

Product ?”

“Would you consider switching to Player A’s Product in the coming year?”

Considerationto buy

Consideration to buy*Consideration to buy*Intention to buy

+10%+10%

+33%+33%

Active e-mail accounts

Inactive e-mail accounts

ATL only (386) 100 36 36

+14%+14%Small sample sizes

in next steps of funnel not covered

due to low significance <50%

(x) Sample size

Source:Market research on 1800 Player A’s existing customers

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Player A Direct Mail Pilot Results

Incremental revenues

Campaign cost**

Net revenue impact

Subscribers gained

250

74

176

*Campaign targetted to Player A’s existing customers** Cost per E-mail is ~0 EURSource:Market research on 1800 Player A’s existing customers

100

0

100

E-mail Direct Mail

100 250

E-mail has clear positive impact for customers with active E-mail accounts

Direct mail has clear positive impact on all Player A’s existing customers

Target profile* All customers

(200)

NET CAMPAIGN IMPACT WAS POSITIVE FOR E-MAIL AND DIRECT MAILIndexed units

Customers with active E-mail accounts (100)

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Player A Direct Mail Pilot Results

DIRECT MAIL GENERATES HIGHER RECALL RATE THAN E-MAILAND ATL (EXCEPT TV) Percentage of respondents*

TV campaign generates highest recall rate

Recall rate of DM is 75% higher than recall rate of E-mail and better than all other media except TV.

28

46

0

70TV

3 49DM**

28E-mail**

18Newspapermagazine

8Radio

7Poster

*Percent of respondents in DM group (for DM), E-mail group (for E-mail), reference group (for ATL)**Aided recall with description of medium used only tested for DM and E-mailSource:Market research on 1800 Player A’s existing customers

Aided recall

Aided recall with description**

+75%+75%

Extensive ATL campaign

ongoing during market research

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Player A Direct Mail Pilot Results

CONTENT RECALL FOR DIRECT MAIL IS 83% HIGHER THAN FOR E-MAIL

Percentage of respondents

Media funnel

DM 100 2749 5555

Received DM / E-mail

Recall DM / E-mail*

Read DM / E-mail

Recall content**

22

Email*** 100 1628 5757 12

4949

2828

8181

7575

“Do you remember receiving a DM / email from Player A’s product?”

“What did you do with the DM / email from Player A’s product?”

“Can you describe what the DM / email from Player A’s product was about?”

Direct Mail is more effective throughout the media funnel leading to an 83% higher content recall rate compared to e-mail

*Aided recall with description**Spontaneous recall based on correct description of mailing received***These results are based on database of frequently used e-mail accountsSource:Market research on 1800 Player A’s existing customers

+83%+83%

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Player A Direct Mail Pilot Results

0

20

40

60

80

DIRECT MAIL AND E-MAIL WERE BETTER PERCEIVED THAN ATL

'To which extent do you agree with the following statements concerning the ad for Player A’s Product?*' Rating on a scale 1 to 10*; % Completely or somewhat agree (% of 7+)

The ad/mailing was credible

The ad/mailing convinced me to become / remain client

The message of the ad/mailing was clear

The ad/mailing was relevant to me

I like the ad/mailing

Percentage of respondents recalling media

*1: I completely disagree, 10: I completely agreeSource:Market research on 1800 Player A’s existing customers

Perception of respondents on DM and E-mail is better than the ATL perception

DM scores better on– Message clarity – Mailing relevance – More convincing when

considering becoming a Player A’s client

DM

E-mail

ATL

10

Player A Direct Mail Pilot Results

BACK-UP

BACK-UP

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Player A Direct Mail Pilot Results

ROI CALCULATION STEPS

Incremental revenues gene-rated by campaign

Incremental revenues gene-rated by campaign

Based on Player A’s actual subscriber figures

NPV on 2 year period taking into account special promotion

Only short term revenues, no long term component

Campaign net revenue impactCampaign net revenue impact

EUR

Campaign investmentCampaign investment

EUR

Incremental revenues per customer

Incremental revenues per customer

EUR

Number of customers taking subscription

Number of customers taking subscription

Number of customers exposed to media

Number of customers exposed to media

Impact on customers taking subscription

Impact on customers taking subscription

%

EUR

Creation, production, and shipping costs of

DM/email

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Player A Direct Mail Pilot Results

DM+ATL

E-mail+ATL

ATL

DIRECT MAIL AND E-MAIL HAD NO IMMEDIATE IMPACT ON BRAND PERCEPTION…

'To which extent do you agree with the following statements concerning Player A’s Product?' Rating on a scale 1 to 10*; % Completely or somewhat agree (% of 7+)

Percentage of respondents

DM nor e-mail have immediate impact on brand perception on top of ATL

This could be due to the extensive ATL campaign running during research

*1: I completely disagree, 10: I completely agreeSource:Market research on 1800 Player A’s existing customers

0

20

40

60

80Easy to contact

Reliable

Offers a lot for your money

Considered as best choice by most people

Informed wellProvider I have had good experiences with

Provider I feel good with

Quickly solving problems

Having best offers

Having large sales network

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Player A Direct Mail Pilot Results

…COMPARED TO RESULTS FROM OTHER PILOTS

'To which extent do you agree with the following statements concerning brand x?' Percentage of respondents

0

20

40

60

80

Rating on a scale 1 to 5; % Completely or somewhat agree (% of 4 or 5)

Professional service

Good reputation

Original advertisement

Wide range of insurance products

Products easy to understand

High compensation level

Excellent value for money

Flexible payment options

Products customized to my needs

Easy to contact

TV

Direct Mail

0

20

40

60

Direct Mail

Control group (no media)Makes my

life easier

Has modern and attractive packaging

Is an innovative and modern brand

Is convenient to use

Is dedicated to continuously improve its products

Offers a complete range of products to deliver the best results for each need

Is an expert in its field

Rating on a scale 1 to 10; % Completely agree (% of 8+)

EXAMPLE OF CLIENT IN FMCG SECTOR EXAMPLE OF CLIENT IN BANKING SECTOR