Digital River 2006 Annual Report Download - page 16

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Customer Service. At our client’s option and for an additional fee, we provide telephone, online chat
and e-mail customer support for products sold through our platforms. We provide assistance to buyers
regarding ordering and delivery questions on a 24/7 basis and in more than ten different languages. We
continue to invest in technology and infrastructure to provide fast and efficient responses to customer inquiries
as well as provide online self-help options. We provide extended download services for digital products for an
additional fee, which enables buyers to download the products they have purchased more than once in the
event of a computer failure or other unexpected problem.
Advanced Reporting and Analytics. We capture and store detailed information about visitor traffic to
and sales in the online stores we manage for our clients and this information is stored in our database systems
where it is available for analysis and reporting. We provide clients access to a large collection of standard and
customizable reports as well as our web analytics technology. This enables our clients to track and analyze
sales, products, transactions, customer behavior and the results of marketing campaigns so they can optimize
their marketing efforts to increase traffic, order close ratios and average order values.
Strategic Marketing Services. We offer a wide range of strategic marketing services designed to increase
customer acquisition, improve customer retention and enhance the lifetime value of each customer to our
clients. Through a combination of web analytics, analytics-based statistical testing, optimization and proven
direct marketing practices, our team of strategic marketing experts develops, delivers and manages programs
such as paid search advertising, search engine optimization, affiliate marketing, store optimization and e-mail
optimization on behalf of our clients. We generally charge an incremental percentage of the selling price of
merchandise for sales driven by our strategic marketing services activities. We believe our ability to capture
and analyze integrated traffic and e-commerce sales data enhances the value of our strategic marketing
services as we can precisely determine the effectiveness of specific marketing activities, website changes, and
other actions taken by our clients.
Clients
We serve two distinct groups of clients: (1) software, product developers and high tech product
manufacturers; and (2) online channel partners including retailers and affiliates. We believe that the breadth of
our catalog of products is a competitive advantage in selling e-commerce services to online channel partners
as they can access a huge volume of products to sell without negotiating contract terms with every product
provider. At the same time, we believe the breadth of our channel partner group is attractive to product
developers and manufacturers as it gives them access to broad distribution through a single source.
Sales and Marketing
We sell products and services primarily to consumers through the Internet. We sell and market our
services for clients through a direct sales force located in offices in the United States, Europe and Asia Pacific.
These offices include staff dedicated to pre-sales, sales and sales support activities. Our client sales
organization sells to executives within software companies, product manufacturers, and online channel partners
who are looking to create or expand their e-commerce businesses. During the sales process, our sales staff
delivers demonstrations, presentations, collateral material, return-on-investment analyses, proposals and
contracts.
We also design, implement and manage marketing and merchandising programs to help our clients drive
traffic to their online stores and increase order close ratios, average order values and repeat purchases at those
stores. Our strategic e-marketing team delivers a range of marketing and merchandising programs such as paid
search advertising, search engine optimization, affiliate marketing, site and store optimization, e-mail market-
ing and optimization and site merchandising, which includes promotions, cross-sells and up-sells. This team
combines their marketing domain expertise with our suite of technology, including reporting, analytics,
optimization and e-mail to drive increased sales for our clients.
We market our products and services directly to clients and prospective clients. We focus our efforts on
generating awareness of our brand and capabilities, establishing our position as a global leader in e-commerce
outsourcing, generating leads in our target markets, and providing sales tools for our direct sales force. We
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