Circuit City 2010 Annual Report Download - page 7

We have established a multi-faceted direct marketing system to business customers, consisting primarily of our relationship marketers, catalog
mailings and proprietary internet websites, the combination of which is designed to maximize sales. Our relationship marketers focus their
efforts on our business customers by establishing a personal relationship between such customers and a Systemax account manager. The goal of
the relationship marketing sales force is to increase the purchasing productivity of current customers and to actively solicit newly targeted
prospects to become customers. With access to the records we maintain, our relationship marketers are prompted with product suggestions to
expand customer order values. In certain countries, we also have the ability to provide such customers with electronic data interchange (“EDI”)
ordering and customized billing services, customer savings reports and stocking of specialty items specifically requested by these customers. Our
relationship marketers’ efforts are supported by frequent catalog mailings and e-
mail campaigns, both of which are designed to generate inbound
telephone sales, and our interactive websites, which allow customers to purchase products directly over the Internet. We believe that the
integration of our multiple marketing methods enables us to more thoroughly penetrate our business, educational and government customer base.
We believe increased internet exposure leads to more internet-related sales and also generates more inbound telephone sales; just as we believe
catalog mailings and email campaigns which feature our websites results in greater internet-related sales.
E
-commerce
The worldwide growth in active internet users has made e-commerce a significant opportunity for sales growth.
The increase in our internet-related sales enables us to leverage our advertising spending. We currently operate multiple e-commerce sites,
including:
We are continually upgrading the capabilities and performance of these websites. Our internet sites feature on-line catalogs of hundreds of
thousands of products, allowing us to offer a wider variety of computer and industrial products than our printed catalogs. Our customers have
around-the-clock, on-line access to purchase products and we have the ability to create targeted promotions for our customers’
interests. Many of
our internet sites also permit customers to purchase “build to order” PCs configured to their own specifications.
In addition to our own e-commerce websites, we have partnering agreements with several of the largest internet shopping and search engine
providers who feature our products on their websites or provide “click-throughs”
from their sites directly to ours. These arrangements allow us to
expand our customer base at an economical cost.
Catalogs
We currently produce a total of 16 full-line or direct mail publications in North America and Europe under distinct titles. Our portfolio of
catalogs includes such established brand names as TigerDirect.com™, Global Computer Supplies™, TigerDirect.ca™, Misco®, Global
Industrial™, Nexel™ and Inmac WStore
®.
We mail catalogs to both businesses and individual consumers. In the case of business mailings, we
mail our catalogs to many individuals at a single business location, providing us with multiple points-of-entry. Our in-house staff designs all of
our catalogs, which reduces overall catalog expense and shortens catalog production time. Our catalogs are printed by third parties under fixed
pricing arrangements. The commonality of certain core pages of our catalogs also allows for economies of scale in catalog production.
Continuing our focus on internet advertising, the distribution of our catalogs decreased to 33 million in 2010, which was 28.3% less than in the
prior year. In 2010, we mailed approximately 26 million catalogs in North America, a 32.1% decrease from last year and approximately 7
million catalogs in Europe, or 9.7% fewer than mailed in 2009.
North America
Europe
www.tigerdirect.com
www.misco.co.uk
www.compusa.com
www.misco.de
www.circuitcity.com
www.misco.fr
www.compusagoved.com
www.misco.nl
www.compusabusiness.com
www.misco.it
www.tigerdirect.ca
www.misco.es
www.infotelusa.com
www.misco.se
www.globalcomputer.com
www.misco.at
www.globalgoved.com
www.misco.ch
www.systemaxpc.com
www.misco.be
www.globalindustrial.com
www.misco.ie
www.globalindustrial.ca
www.wstore.co.uk
www.inmac
-
wstore.com
www.dealopro.com
5