Contents - AL-Tax

116 8 Replication of Internet-Based Business Modelmarketing strategies. USP currently has a customer base of 475 clients, all of whichoperate websites in North America.As noted, USP draws on both public data (e.g., census data and credit histories)and information obtained directly from customers in the course of rendering itsmarketing services. Its data analysis, based on standard statistical methods, is notproprietary. However, key aspects of its business model, such as the rewards-basedprocess by which it elicits private data from customers, are proprietary and haveproven to be exceptionally effective. USP is compensated for its services by commission,based on certain metrics designed to measure success (i.e., the increase insales attributable to its marketing programs), as negotiated with individual clients.From an organizational standpoint, USP is composed of the following four coregroups: Business Development, Account Management, Marketing and InformationTechnology (IT). Additionally, USP performs a number of support functions, includingcustomer service, human resources (HR), legal, finance, tax and internal audit.Each of these functions is described briefly below.8.1.1 USP: Business Development GroupUSP’s Business Development Group is responsible for developing new client relationships.It makes initial contact with prospective clients through a number of differentchannels, among them email, trade shows, cold calls, etc. If prospects expressinterest during these initial contacts, USP’s Business Development staff will meetface-to-face at the prospective client’s location. At this first meeting, members ofthe Business Development Group will describe USP’s marketing programs, walkthrough the process by which individual customers’ private information is solicitedand how they are rewarded, illustrate USP’s analytical and creative contributions andthe economic benefits to prospects through case studies, and briefly review certainmetrics of success that it has used with other clients.This initial meeting is followed by discussions with client constituencies whowere not represented at the meeting, negotiations over the economics of the programto be offered, technical and other discussions with the prospective client’sIT and marketing staffs, etc. The sales cycle ranges from 90 days to a full yearand is completed with the execution of a contract. USP concludes contracts withapproximately 30%–35% of prospects that express an interest in implementing ahighly customized direct marketing program during their initial contact.8.1.2 USP: Account Management GroupUSP’s Account Management Group is responsible for managing all aspects of clientrelationships once clients have entered into a contract with the Company. At theoutset, the Account Management Group works with clients to develop and launchan initial campaign. Among other things, this step entails (a) providing clients withUSP’s data solicitations page, (b) implementing data feed protocols and proceduressuch that information obtained through the solicitations page is provided to USP