Incredimail 2013 Annual Report Download - page 31

In the past, we predominantly defined ourselves as a business-to-
consumer company, offering quality software directly to consumers.
Today, we view ourselves as a business-to-business-to-
consumer company, empowering other software companies in effectively distributing and
monetizing the products they offer to consumers. We plan to leverage our core assets and competencies as software developers to expand into
programmatic data-
driven advertising. Additionally, we plan to focus on provision of mobile, social, and video monetization solutions in light of
the growing popularity for these outlets.
In order to extend our business beyond organic growth and accelerate our ability to bring new solutions and products to our clients and
consumers, we have adopted a strategy to invest in acquiring new technologies and business platforms. This strategy most recently resulted in
the transformative acquisition of ClientConnect in January 2014. This strategy will enable us to further diversify our revenue base, better serve
the needs of our clients and consumers, and reduce the time required to bring new services and solutions to market.
We believe we will be able to further grow our business by:
Search generated revenues
We generate the majority of our revenues from services agreements with our search partners. Search generated revenues accounted for
72%, 63% and 68% of our revenues in 2011, 2012 and 2013, respectively. Through our search syndication technology, we offer end users the
ability to search the internet via easily embedded search boxes powered by premium search companies, including Microsoft, Google, APN, LLC
("Ask") and Yahoo, and depending on the search partner powering the search or location in which the search was initiated, we receive either a
fixed price, pay-per-search fee or portion of the revenues generated by these companies through the search process.
In the past, Google’
s coverage and service offering was the one most suited to our global distribution and provided the best
monetization opportunity for our products. As such, we have been working with Google since 2007, and renewed our agreement with Google for
another two years effective May 1, 2013. Nonetheless, in adapting to the changes in the search marketplace, particularly in 2013, we were
successful in engaging other search providers. On December 28, 2012, we signed a one year renewable agreement with Microsoft’
s Bing (which
was amended on March 18, 2013 and September 15, 2013). On April 29, 2013, we signed a three year agreement with Ask (which was amended
on January 17, 2014 and February 3, 2014), with auto-
renewal for additional one year periods. On April 19, 2013, we signed a two year
agreement with Yahoo, with auto-
renewal for additional one year periods. In addition, prior to the ClientConnect Acquisition, on August 12,
2013 we signed a search distribution partnership with Conduit (the "Conduit Commercial Agreement").
• Growing our client base organically and through acquisitions.
Our historical growth has been driven by our success in providing
tailored answers to our clients’ need for fast, flexible, and data-
driven solutions, either developed organically or through the
acquisition of products or businesses.
•
Increasing the frequency of use by our clients and their consumers.
By focusing on the needs of our clients and their consumers,
we believe we can increase the use of our clients' offerings and subsequently the search capabilities offered, as well as
advertising revenues, thereby increasing our revenues.
•
Enhancing the client experience.
We have always focused on providing a positive experience to our clients. We understand that
each client has unique needs, and we tailor our solutions to account for this reality. We employ a staff of friendly account
managers who are dedicated to the success of our clients. Additionally, the results of our powerful analytics are displayed in an
easily readable and well
-
organized fashion, enabling an easy access point to relevant and useful data and analytics.
• Continuing to focus on the online consumer market.
Our LCM platform particularly suits online software developers. As
developers ourselves, we have seen first-
hand the increasing popularity of mobile and social product markets and have
successfully broadened our products to account for this new reality. The Internet and the available application stores enable
online publishers and developers to reach potential users throughout the world quickly and easily as well as reduce the costs
associated with sales and distribution of their products and services. We therefore have developed solutions that enable our
clients to take full advantage of these new markets.
•
Enhancing the consumer experience.
We have always attempted to provide a positive experience to users of our legacy products.
As we further emphasize this aspect, we will continue to design our products and services and market them to address users’
aversion to offensive Internet marketing tools, which we believe encourages more use of our products and solutions and
increases user loyalty.
26