MoneyGram 2010 Annual Report Download - page 9

Table of Contents
We continue to invest in our infrastructure to provide a better overall consumer and agent experience, reduce our costs and create
efficiencies. We have made important infrastructure enhancements to our settlement and commission processing, data management,
financial systems and regulatory and compliance reporting. We continue our efforts to enhance our agent on-boarding process, improving
our speed to market for new agents.
Sales and Marketing
We have global marketing, product management and strategic partnership teams located in numerous geographies, including the United
States, United Kingdom, Italy, Spain, United Arab Emirates, India and China. We employ a strategy of developing products and
marketing campaigns that are both global yet also tailored to address our customer base and local needs. We market our products through
a number of dedicated sales and marketing teams, and continually assess the effectiveness of our sales and marketing efforts.
A wide range of marketing methods continue to support our sales efforts. A key component of our advertising and marketing efforts is
our global branding. We use a marketing mix to support the global brand, which includes traditional media and digital and social media,
point of sale materials, MoneyGram-branded signage at our agent locations, a loyalty program and targeted direct marketing programs
and seasonal campaigns and sponsorships.
Our sales teams are organized by geographic area, channel and product. We have dedicated support teams that focus on developing our
agent and biller networks to enhance the reach of our money transfer, bill payment and money order products. Our agent requirements
vary depending upon the type of outlet or location, and our sales teams continue to work to improve and strengthen our agent partnerships
with a goal of providing the optimal customer experience.
Competition
While we are the second largest money transfer company in the world, the market for our money transfer and bill payment services
remains very competitive. The market consists of a small number of large competitors and a large number of small, niche competitors.
Our competitors include other large money transfer and electronic bill payment providers, banks and niche person-to-person money
transfer service providers that serve select regions. Our largest competitor in the money transfer market is Western Union, which also
competes with our bill payment services and money order businesses. As new technologies for money transfer and bill payment services
emerge that allow consumers to send and receive money and to pay bills in a variety of ways, we face increasing competition. These
emerging technologies include online payment services, card-based services such as ATM cards and stored-value cards, bank-to-bank
money transfers and mobile telephone payment services.
We generally compete for money transfer agents on the basis of value, service, quality, technical and operational differences, price and
commission. We compete for money transfer consumers on the basis of number and location of outlets, price, convenience, technology
and brand recognition. Due to increased pricing competition, in the first half of 2010 we introduced a $50 price band which allows
consumers to send $50 of principal for a $5 fee at most locations, or $4.75 at a Walmart location.
Regulation
Compliance with laws and regulations is a highly complex and integral part of our day-to-day operations. Our operations are subject to a
wide range of laws and regulations of the United States and other countries, including international, federal and state anti-money
laundering laws and regulations; financial services regulations; currency control regulations; anti-bribery laws; regulations of the U.S.
Treasury Department's office of Foreign Assets Control ("OFAC"); money transfer and payment instrument licensing laws; escheatment
laws; privacy, data protection and information security laws; and consumer disclosure and consumer protection laws. Failure to comply
with any applicable laws and regulations could result in restrictions on our ability to provide our products and services, as well as the
potential imposition of civil fines and possibly criminal penalties. See "Risk Factors" for additional discussion regarding potential
impacts of failure to comply. We continually monitor and enhance our global compliance programs to comply with the most recent legal
and regulatory changes. During 2010, we continued to increase our compliance personnel headcount and make investments in our
compliance-related technology and infrastructure.
6