Stamps.com 2005 Annual Report Download - page 7

• Our service provides the ability to send US Postal Service packages with Hidden Postage™, which hides the actual amount paid for
postage, a useful feature for e-commerce companies that may not want the recipient to have actual shipping cost information; and
• Our software can help a business reduce its customer support costs by automatically generating and sending package delivery status e-
mails to its customers.
Marketing of PC Postage
Our PC Postage marketing has traditionally been targeted primarily at small businesses and home offices. We have marketed, and plan to
continue marketing, our PC Postage service in several ways, including the following channels:
• Partnerships. We work with strategic partners in order to leverage their web site traffic, marketing programs, and existing customer
base to distribute our PC Postage software. For example, these partnerships may provide a link to our website from a partner’s
website, may provide a copy of our software along with a partner’s software product, may distribute our software at a retail location,
or may bundle our software with a hardware device. An example of this type of relationship is our partnership with Microsoft where
our software is available for download from the Office Update section of Microsoft’s website. Other examples include Peachtree and
EarthLink.
• Traditional Online Advertising. We work with companies to advertise our service in a number of ways across the Internet including
paid search, banner ads, permission-based emails, and other online advertising vehicles.
• Enhanced Promotion Online Advertising. We work with various companies to advertise our service in various places across the
Internet. This channel typically offers an additional promotion directly to the customer by the partner in order to get the customer to
try our service.
• Affiliate Channel. We utilize the traffic and customers of smaller web sites and other businesses or individuals that are too small to
qualify for a partnership directly with Stamps.com. Our affiliate channel is currently managed by a third party. We offer financial
incentives for these small businesses and individuals to drive traffic to our web site.
• Direct Mail. We send direct mail pieces to prospective small business, small office, and home office customers. We purchase targeted
prospect lists from third parties or obtain prospect lists from partners.
• Remarketing. We remarket our service to former customers. Our remarketing efforts are generally focused on the new features which
may relate to the reasons former customers stopped using our service. We utilize e-
mail and regular mail to communicate new features
of our products to our former customers.
• U.S. Postal Service Referrals.
We work to utilize the nationwide U.S. Postal Service Account Manager network to market and sell our
services to customers. We market to the account managers by attending regional and national meetings and forums, and participating
in local vendor calls. We also receive referrals directly from the US Postal Service website at www.USPS.com.
Marketing of PhotoStamps
During our second market test, we have been testing numerous marketing channels for PhotoStamps, including traditional offline
advertising, online advertising, and partnerships. While we are hopeful that the USPS will ultimately approve the continuation of our
PhotoStamps offering following the end of this second test period, there are many risks related to this offering.
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