MoneyGram 2011 Annual Report Download - page 8

Table of Contents
Money Orders — We generate revenue from money orders by charging per item and other fees, as well as from the investment of funds underlying
outstanding money orders, which generally remain outstanding for fewer than ten days. We sell money orders under the MoneyGram brand and on a private
label or co−branded basis with certain of our large retail and financial institution agents in the United States.
In 2011, we issued approximately 161.9 million money orders through our network of 55,100 agent and financial institution locations in the United States
and Puerto Rico. In 2010, we issued approximately 174.2 million money orders through our network of 57,308 agent and financial institution locations in
the United States and Puerto Rico.
Official Check Outsourcing Services — As with money orders, we generate revenue from our official check outsourcing services from per item and other
fees and from the investment of funds underlying outstanding official checks, which generally remain outstanding for fewer than 4.1 days. In 2009, we
restructured our official check business model by reducing the commissions we pay our financial institution customers and increasing per item and other
fees. As of December 31, 2011, we provide official check outsourcing services at approximately 8,500 branch locations of more than 1,300 financial
institutions. We issued 24.2 million and 30.3 million official checks in 2011 and 2010, respectively.
Product and Infrastructure Development and Enhancements
We focus our product development and enhancements on innovative ways to transfer money and pay bills. We continually seek to provide our customers
with added flexibility and convenience to help them meet the financial demands of their daily lives. We also invest in our infrastructure to increase
efficiencies and support our strategic initiatives.
We are reaching new customers through alternate and self−service money transfer delivery channels. We offer our money transfer services on the Internet
via our MoneyGram Online service in the United States, United Kingdom and through agent websites in Italy, Saudi Arabia and Japan. In Italy, Abu Dhabi
and the Philippines, we also offer our money transfer services via mobile phone and continue to enhance our money transfer services to consumers through
the addition of kiosks, ATMs, receive cards and direct−to−bank account products in various markets. We also introduced the convenience of cash−to−card
services through key agents in the Philippines, which allows their customers to collect remittances on a card, which can then be used to pay for purchases at
participating stores. We continue to expand product offerings in key markets such as multi−currency options in China, direct−to−account in Brazil and
customer−directed receives in the Ukraine.
We have made enhancements to our MoneyGram Online service and will continue to make further enhancements to provide a better consumer experience
and efficiency in completing a transaction for our online customers, as well as more cost−effective transaction processing. MoneyGram Online transactions
and revenue grew 30 percent in 2011 over the prior year. We also enhanced our MoneyGram rewards program, and now offer members the ability to receive
a text message on their mobile phones informing them that the funds they transferred have been picked up by their receiver.
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
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