SUPERPHOTO Pricing And Delivery Policy

Pricing, Product & Delivery Policy Dimitri Popov CEO SuperPhoto July, 2009

Current issues • Consumer Choice - made difﬁcult • Poorly communicated (web site and software) • Difference in 20 and 40 pages misleads • Photobooks start only from 199, nothing below 100 • Quality (soft cover) • Low demand for some formats: A3, A4 Portrait

What we want from a satisﬁed customer? • Recommend others (family, ofﬁce) • Increase average check • More expensive photobook • Larger format • More pages • Several photobooks in one order • Increase frequency of orders

What a satisﬁed customer wants from us? • FINANCIAL • SERVICE • Frequent ﬂyer program • Faster delivery • Volume discounts (several • Reliable delivery copies, additional pages, various books) • Help in design (professional or a class) • PRODUCT • Help in photographing • New features and formats (professional or a class) • Constant quality

Key pricing questions? • Is our pricing good enough • to stimulate customer future choice of a larger book? • to stimulate customer to insert more pages? • to compete with photo printing (to make customers think of switching)? • Is our delivery policy OK to initiate ﬁrst orders as well as generate proﬁts?

Current pricing & formats Soft Cover Hard Photo Cover Hard Linen Cover A5 199/7.95* 249/7.95 Small Square 21 339/9.95 379/9.95 A4 Landscape 395/9.95 365/9.95 A4 Portrait 355/9.95 385/9.95 375/9.95 Big Square 30 695/15.85 A3 Landscape 795/15.85 * Here and everywhere price for 2 pages

AlbumPrinter Pricing GBP Hard Linen Cover Hard Photo Cover Leather Cover 13x10 9.95/+0.25 +2.95 +3.50 A5 15.95/+0.40 +3.95 +4.95 Small Square 21 24.95/+0.65 +4.95 +7.50 A4 Landscape 25.95/+0.65 +4.95 +7.50 A4 Portrait 25.95/+0.65 +4.95 +7.50 Big Square 30 34.95/+0.75 +7.25 +9.95

Blurb Pricing Euro Soft Cover Hard Photo Cover Hard Linen Cover Small Square 18 12.95 24.95 22.95 Standard Landscape 20x25 19.95 31.95 29.95 Standard Portrait 25x20 19.95 31.95 29.95 Large Landscape 28x33 n/a 56.95 54.95 Big Square 30 n/a 62.95 59.95

Smilebook Pricing US$ Booklet Soft Cover Linen Cover Hard Cover Leather Pocketsize 5’’ 9.95/+0.50 Square 21 16.95/+1 26.95/+1 32.95/+1 44.95/+1.25 A4 Portrait 19.95/+1 28.95/+1 34.95/+1 39.95/+1 A4 Landscape 39.95/+1 Large Square 30 68.95/+1 68.95/+1 68.95/+1 A3 Portrait 89.95/+1.50 A3 Landscape 149.95/+2 189.95/+2

We are priced in line with competitive markets Base* Index Base Index Base Index Base Index A5 245 100 15.95 100 100 100 Small Square 21 375 152 24.95 156 24.95 156 32.95 156 A4 Landscape 395 159 25.95 163 31.95 200 34.95 165 A4 Portrait 395 159 25.95 163 31.95 200 34.95 165 Big Square 30 695 275 34.95 219 62.95 395 68.95 325 * Price for 40 pages, while international brands all have 20-26 pages in Base

Stay with 20 pages Base Index Base Index Base Index Base Index A5 195 100 15.95 100 100 100 Small Square 21 275 140 24.95 156 24.95 156 32.95 156 A4 Landscape 295 150 25.95 163 31.95 200 34.95 165 A4 Portrait 295 150 25.95 163 31.95 200 34.95 165 Big Square 30 495 250 34.95 219 62.95 395 68.95 325 * Price for 40 pages, while international brands all have 20-26 pages in Base

Prices for booklets and books are balanced PhotoBooks Booklets Base Index Base Index A5 249 100 59 100 Small Square 21 379 152 89 151 A4 Landscape 395 159 99 168 A4 Portrait 395 159 n/a Big Square 30 695 275 n/a

New policy: photo cover is superior Booklet Hard Leather Cover Hard Photo Cover Min/Max Pages 8/24 20/120 40/120 (Step) A5 59/4 195/4 245/4 Small Square 21 89/5 275/5 375/5 A4 Portrait 99/5 295/5 395/5 A4 Landscape 295/5 395/5 Big Square 30 495/8 695/8

Price for A4 hard cover dropped, 9 changed to 5 Hard Leather or Linen Cover Hard Photo Cover New Old New Old A5 195/4 never existed 245/4 249 Small Square 21 275/5 never existed 375/5 379 A4 Portrait 295/5 365 395/5 395 A4 Landscape 295/5 375 395/5 395 Big Square 30 495/8 never existed 695/8 695 A3 Landscape deleted 795 never existed never existed

Samples & Themes for sales and online promo Booklet Hard Leather Cover Hard Photo Cover Min/Max Pages 8/24 20/120 40/120 A5 Love 8 + Kids 24 Small Square 21 Family 20 Vacation 40 A4 Portrait Catalog 24 A4 Landscape Portfolio 80 Big Square 30 Wedding 120

Delivery Policy • Current: • all orders above 95 UAH free delivery all Ukraine • Issues: • UkrPoshta does not provide for exact delivery costs, thus making customers to pay extra • Financial losses in the range of average check of 96-125 UAH (photos only)

UkrPoshta • FOR CUSTOMER • Unclear delivery dates (±2 workdays) • Unpredictable fee (breaking the promise of Free Delivery) • Unable to open/check unless paid (breaking COD promise) • FOR US • Has it been delivered? Paid? RETURNED?

Express Production and Delivery Regular Express 2 workdays Production 5 workdays +150 UAH Delivery Kiev 1 workday 1 workday Delivery Ukraine 5 days 5 days

Shipping Options Kharkiv, Other oblast Kiev Dnepropetrovsk, Rural centers Odessa Service COD COD COD COD Novaya Carrier Courier Courier POchta UkrPochta Costs 23 60 80+ 33 + client pays 20-30 Timing same day next day 1-2 days 5-8 days

Open questions • How can we stimulate a customer • start a new photobook more often? • order another photobook asap after he received his ﬁrst one?

SuperPhoto has to compensate for the lack of business infrastructure

SUPERPHOTO Pricing And Delivery Policy

by Dimitri Popov

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