Marketsmith, Inc. - Article From Newsletter

2007 was a good year. We experienced 31% growth over the year prior, we have been recognized as the 44th fastest-growing company in the state, and we have 100% client retention going into 2008.

2008 is not a year for goals; I see it as a year for action. In this newsletter, Marketsmith is taking a very strong position on where catalogers and retailers need to be. The data continue to show that missteps in each quarter are compounded by the realities marketers face in 2008. We know that it is a year of mandates on many fronts, and we want to share these with you.

1.	Focus on EBITDA - With a business and consumer environment facing an uncertain economy, election year, and global fears, the time has come for companies to stop thinking that circulation is the only answer to improving bottom line performance. As discussed in an article I penned, EBITDA is the combination of science, leadership, and instinct. This is a topic I have been close to and we are passionate about. I discuss the need from the top down to provide the data necessary to make the best contact decisions all the way to a contribution positive position, for example, mailers should stop using offers to drive top line revenue and not recognize the strain on the bottom line. Additionally, forecasters must work hand-in-glove with the merchants to deliver realistic numbers in an effort to create an optimal merchandise stock position.
2.	Matchback Technology - We discuss the need to use matchback technology and creating rules around it. 40% of the companies we came across last year still did not engage this important and necessary tool.
3.	Use the Internet to shape Merchandising Strategy - We created a study to show how the use of the internet has allowed for customer transparency to occur in merchandise, pricing, S&H costs, and more.
4.	Self-Regulation Compliance - The DMA is imploring all companies to be obsessed about compliance to ensure self-regulation continues. We believe the days of self-regulation are coming to a swift halt as our embattled industry faces the fight from better-funded targets that need a win. The environmental groups, although well-intentioned, are a goliath, I think, far bigger than USPS, and we already know how our industry fared against the postal service, costing the industry double digit dents into their profits. Another tax could be the final death blow for many struggling catalog companies.
5.	Marketsmith Masters Program - In response to multiple requests, we have decided to present an intensive, hands-on business tutorial program. We are offering a two day session to a limited number of participants where we will share Marketsmith insights and methodology while working directly with individual participant's data. Please contact me directly if you are interested to know more about the program.

More than ever, I recognize that my company offers help for our industry, which is in turmoil. Our industry leaders need heavy lifters who can take companies where they need to go. We need to be wary of those pontificators who only talk the talk but do not walk the walk. We need leaders who are lions, fierce in their approach to challenging times and littered landscapes, addressing issues with tenacity, supported by a team who understands cause, effect, and how to use the numbers on both sides of the equation. The bottom line is that businesses face uphill battles. As companies fight those battles, we at Marketsmith know how to help them win.

Now is the time for your organization to get straight what it faces all the way down to each and every segment. Our phone rang throughout December with the voices of CEO's confused and struggling with their results and challenged with finding where they went wrong.

Success is a team effort between internal people and external service providers, on the same page, with one endgame - profitability. We know improvement can come as quickly as 90 days because we have seen it happen with our clients time and time again.

We expect our growth to continue this year as we bring an understanding of what it takes to get customers to buy, the cost and form of the contact, and the implications of cost of the fulfillment to give shape to an effective and realistic marketing strategy. As we discussed above, there will be many pain points for our industry this year. But make no mistake, our company will grow, not because of the pain, but because we stand as one of the only companies who absolutely will take the pain away, and in fewer than 90 days.

I wish for all of you to be successful. My team and I are always here for you.

My Very Best Always,

M-