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The Shelbourne Hotel
Dublin 2                    Facebook.com/DealEffect
30th Jan 13
                            Twitter.com/DealEffect_ie
7.30am
                       YouTube.com/DealEffectIreland
WHAT ARE DAILY DEALS?

   An online daily coupon service
   offering deals discounted at
   50% or more of their normal
   retail value. Opt-in service that
   emails subscribers a daily offer
   for a limited time.
Value of Irish DAILY DEALS Industry?

 2012: €53 million
 spent on daily
 deals websites

 2012: 15% year-
 on-year growth
 from 2011.
AIM OF DEAL EFFECT

  Deal Effect provides a fundraising
  platform for the Irish charity &
  non-profit sector through a daily
  deals website, remitting 11% of
  revenue to participating
  organisations.
HOW WILL DEAL EFFECT WORK?
 Deal Effect proposes to :
 A. Encourage charities to be founding members
 B. Encourage charities to promote the service to
    their databases of supporters
 C. Offer daily deals discounted at more than 50%
 D. Remit 11% of its revenue to charity/non-profits
HOW IS THE REVENUE SPLIT?
  1). Merchant                             70%
  2). Charity                              11%
  3). Deal Effect Revenue                  19%
        Staff & Operational Costs     X
        Marketing Costs               X
        Software Management          4%
        Bank Charges                 2%
        Revenue to The Wheel        1.5%
                                    19%    100%
IS THERE A MARKET FOR THIS?

 1 Jan – 1 Dec 2012 (information supplied by mydealpage.ie and strictly confidential)

 • 1.6 million vouchers sold = 4,500+ each day

 • €53 million spent on daily deals = €145,000 each day average

 • €75 million saved by purchasing deals

 • 14,184 deals done throughout the country

 • €32.53 is average price per deal in the Irish market
WHAT ABOUT THE COMPETITORS?
                           1 Jan – 1 Nov 2012

                                                GROUPON 32%
                                                LIVING SOCIAL 21%
                                                GRABONE 14%
                                                PIGSBACK 14%
                                                DEALRUSH 7%
                                                OTHER 12%


 • Top 5 sites account for 61% of deals done (8,716) and 89% of
 revenue (€35.5m)
 • BoardsDeals leaves a market share of about 4.3% up for grabs
 after their exit in September.
HOW LONG HAVE WE BEEN WORKING ON IT?
 Aug 2011         The Wheel approached by Basil Good
 Sep – Oct 2011   The Wheel Internal Research & SWOT Analysis
 Nov – Dec 2011   Discussions with other charities
 Jan – Apr 2012   Formal Focus Group of charities convened
 May 2012         Independent Feasibility Report Completed
                  An e-commerce start-up professional to project
 July 2012
                  manage to investor ready status
 Sept 2012        Develop Legal framework
 Nov 2012         Project delivered to an investor ready stage
 Jan/Feb 2013     Full Investment Secured
 April 2013       Launch
ARE PEOPLE LIKELY TO SIGN UP?
 • 61% of consumers have signed up to an online
   discount site.
 • 37% of the Irish Adult Population has purchased
   a product or service from an online discount site
 • 7% purchase at least once a week (€125.84)
 • 36% purchase at least once a month (€29.04)
                       July 2012 figures from the National Consumer Agency

 • Longitudinal research by Cone: 84% of
   consumers likely to switch brands to one
   associated with a good cause
CAN TARGETS BE MET THROUGH
CHARITIES?
 • Focus group: Databases of 10 charities = 167,000
   individuals
 • Model based on 8,000 subscribers at launch
 • Growth of 500 subscribers daily for 3 months (levelling
   off to 100)
 • 96,000 subscribers by end of year 1 (DealRush: from a
   standing start 100,000 subscribers in 12 months for a 4%
   market share)
WHY WILL IT SUCCEED?
 • Consumers want to support their cause
 • Charities get a return of revenue not profit
 • Charities return pro-rata to subscribers
 • Retailers happier to deal with charities
 • Access to potential multiples of the 167,000
   individuals (10 charity databases)
 • Collaborative effort, economies of scale
FINANCIAL ASSUMPTIONS

 • 30-50 Charities at Launch – steady increase over 3 years
 • 8,000 Subscriber Base at Launch
   - increasing daily to > 100,000 by end Feb 2014
   - and to > 128,000 by end Dec 2015
 • Deal Price - €22 – 66.67% of Market Average
 • Initially 5 Deals per week
 • Deals capped at 500 Vouchers
 • Raising over €2.1 million+ for charity sector in 3 yrs
FORECAST INCOME & EXPENDITURE
  Deal Effect                                        2013           2014           2015
  Forecast Income & Expenditure 2013 -2015             €              €              €


  TOTAL DEAL REVENUE
                                                     (000's)        (000's)        (000's)
                                                                                                  By 2015: Deal
  Deal Revenue (Merchant & Deal Effect)
  Charity Donations (11% of Total Deal Turnover)
                                                           2,910
                                                            360
                                                                          6,673
                                                                           825
                                                                                         7,676
                                                                                          949     Effect aims to
  Total Deal Turnover                                      3,270          7,498          8,625


  INCOME
                                                                                                  be in top 3
  Deal Effect Revenue from Deals (19%)
  Charity Subscriptions
                                                            621
                                                                9
                                                                          1,425
                                                                               6
                                                                                         1,639
                                                                                              6
                                                                                                  daily deals site
  Deal Effect Total Income                                  630           1,431          1,645
                                                                                                  in Ireland,
  EXPENDITURE
  Payroll Costs (incl. Employers social insurance)
  OSGO Software licence and support
                                                            338
                                                            131
                                                                           469
                                                                           300
                                                                                          536
                                                                                          345
                                                                                                  remitting
  Credit/Debit Card Commission/bank fees
  General Marketing & PR
                                                               65
                                                               51
                                                                           150
                                                                              37
                                                                                          172
                                                                                             43
                                                                                                  €2.1m+ to
  The Wheel (1.5% of Deal Turnover)                            49          112            129
  Other (incl. start up and legals)
  Total Expenditure
                                                            186
                                                            821
                                                                           167
                                                                          1,236
                                                                                          177
                                                                                         1,402
                                                                                                  charities
  Surplus / (Deficit)                                      (191)           194            242


  Cash Balance at 31st December
  Agency Bank Account                                       636            828            895
  Operating Bank Account                                       46          260            257
BRAND STRATEGY
 •   Brand Positioning: Aimed at more established brands and
     reputable merchants with a high end but broad market
     appeal
 •   Consumer insight: Deal Effect saves you money, allows
     you to discover new experiences and feel good while
     doing so
 •   ‘FairTrade’ USP: Every deal purchased contributes to a
     chosen charity
 •   Core target market: Females 25-44
 •   Secondary target market: Adults 25-44 in Dublin, Cork and
     Galway
DEALS STRATEGY

 •   National Deals will have priority e.g. Accommodation, retailers
 •   Best locations for deals are in Dublin, Cork and Galway
 •   High quality sales team
 •   Superior customer service experience
 •   Maintain minimum of 14 days worth of deals in advance
 •   All deals will adhere to a deal code of ethics
 •   Deal grouping e.g. hotel,+ event ticket deals
 •   Great deals – leverage brands
 •   Focus on retention rates and user’s experience
MARKETING STRATEGY
•   TV - Bespoke activity
•   Digital advertising (online display, email capture form)
•   Social Media (paid, communities, targeted, competitions)
•   PR & Industry awareness
•   Search engine optimisation (SEO)
•   Radio
•   Trade marketing
•   Incentives to current subscribers
•   Working closely with charities to leverage their PR and
    marketing
HOW DO WE DRIVE SALES?
 •   Email daily deal to subscribers
 •   Affiliate marketing sites
 •   Deal aggregator sites
 •   Social media offers – geographic and demographic
     targeting
 •   Regular social media engagement
 •   Pay Per Click campaign on search
 •   Constant evaluation of sales funnel
 •   Refer a friend
WHERE ARE WE NOW?
 • Business Plan completed
 • Legal advice in place, finalising key documents
 • Recruitment drive commenced
 • Roll out plan for Spring 2013
    – Sales Plan
    – Marketing Plan
 • Investment from charities ongoing
 • Donations/Interest free loans needed from private
   sector to reach target of €262,500
CHARITIES COMMITTED (26 to date)
INVESTMENT REQUIRED: €262,500
    Deal Effect Funding Sources €262,500 as at 30 Jan 13
                                                   Charities committed
                             €53,000
                               20%                 Private Investment - To
                                                   Date
                                                   The Wheel
        €85,000
          32%
                                                   Charities TBC

                                         €52,000   Start-up Grants TBC
                                           20%

                                                   PRIVATE SECTOR TBC
        €35,000
          13%
                   €25,000     €12,500
                     10%         5%
INVESTMENT REQUIRED: €262,500
           Deal Effect Funding Sources €262,500 as at 30 Jan 13
                                                          Charities committed
                                    €53,000
TODAY                                 20%                 Private Investment - To
we are                                                    Date
€120,000                                                  The Wheel
               €85,000
short of         32%
€262,500                                                  Charities TBC
funding
for                                             €52,000   Start-up Grants TBC
                                                  20%
launch
                                                          PRIVATE SECTOR TBC
               €35,000
                 13%
                          €25,000     €12,500
                            10%         5%
Vision for 2015: Deal Effect will be in top 3 daily
 deals site in Ireland, remitting €2.1m+ to charities.
                     promoting equality            fighting alcohol
     preventing suicide                            abuse
                                                                      building affordable
                                                                      housing
protecting vulnerable                                                          coordinating
children                                                                       emergency relief
  providing sports
  facilities
                                                                            alleviating poverty
         fighting domestic
         violence                                                        helping the
                                                                         homeless
     supporting people with
     cancer                                                                         supporting the arts
      training guide
      dogs for the blind                                  fighting addiction
          fighting child                                                    promoting independence
          abuse                                                             for people with
                              caring for older people
                                                        promoting mental    disabilities
                                                        health

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Deal Effect Business Presentation 30 Jan 13

  • 1. The Shelbourne Hotel Dublin 2 Facebook.com/DealEffect 30th Jan 13 Twitter.com/DealEffect_ie 7.30am YouTube.com/DealEffectIreland
  • 2. WHAT ARE DAILY DEALS? An online daily coupon service offering deals discounted at 50% or more of their normal retail value. Opt-in service that emails subscribers a daily offer for a limited time.
  • 3. Value of Irish DAILY DEALS Industry? 2012: €53 million spent on daily deals websites 2012: 15% year- on-year growth from 2011.
  • 4. AIM OF DEAL EFFECT Deal Effect provides a fundraising platform for the Irish charity & non-profit sector through a daily deals website, remitting 11% of revenue to participating organisations.
  • 5. HOW WILL DEAL EFFECT WORK? Deal Effect proposes to : A. Encourage charities to be founding members B. Encourage charities to promote the service to their databases of supporters C. Offer daily deals discounted at more than 50% D. Remit 11% of its revenue to charity/non-profits
  • 6. HOW IS THE REVENUE SPLIT? 1). Merchant 70% 2). Charity 11% 3). Deal Effect Revenue 19% Staff & Operational Costs X Marketing Costs X Software Management 4% Bank Charges 2% Revenue to The Wheel 1.5% 19% 100%
  • 7. IS THERE A MARKET FOR THIS? 1 Jan – 1 Dec 2012 (information supplied by mydealpage.ie and strictly confidential) • 1.6 million vouchers sold = 4,500+ each day • €53 million spent on daily deals = €145,000 each day average • €75 million saved by purchasing deals • 14,184 deals done throughout the country • €32.53 is average price per deal in the Irish market
  • 8. WHAT ABOUT THE COMPETITORS? 1 Jan – 1 Nov 2012 GROUPON 32% LIVING SOCIAL 21% GRABONE 14% PIGSBACK 14% DEALRUSH 7% OTHER 12% • Top 5 sites account for 61% of deals done (8,716) and 89% of revenue (€35.5m) • BoardsDeals leaves a market share of about 4.3% up for grabs after their exit in September.
  • 9. HOW LONG HAVE WE BEEN WORKING ON IT? Aug 2011 The Wheel approached by Basil Good Sep – Oct 2011 The Wheel Internal Research & SWOT Analysis Nov – Dec 2011 Discussions with other charities Jan – Apr 2012 Formal Focus Group of charities convened May 2012 Independent Feasibility Report Completed An e-commerce start-up professional to project July 2012 manage to investor ready status Sept 2012 Develop Legal framework Nov 2012 Project delivered to an investor ready stage Jan/Feb 2013 Full Investment Secured April 2013 Launch
  • 10. ARE PEOPLE LIKELY TO SIGN UP? • 61% of consumers have signed up to an online discount site. • 37% of the Irish Adult Population has purchased a product or service from an online discount site • 7% purchase at least once a week (€125.84) • 36% purchase at least once a month (€29.04) July 2012 figures from the National Consumer Agency • Longitudinal research by Cone: 84% of consumers likely to switch brands to one associated with a good cause
  • 11. CAN TARGETS BE MET THROUGH CHARITIES? • Focus group: Databases of 10 charities = 167,000 individuals • Model based on 8,000 subscribers at launch • Growth of 500 subscribers daily for 3 months (levelling off to 100) • 96,000 subscribers by end of year 1 (DealRush: from a standing start 100,000 subscribers in 12 months for a 4% market share)
  • 12. WHY WILL IT SUCCEED? • Consumers want to support their cause • Charities get a return of revenue not profit • Charities return pro-rata to subscribers • Retailers happier to deal with charities • Access to potential multiples of the 167,000 individuals (10 charity databases) • Collaborative effort, economies of scale
  • 13. FINANCIAL ASSUMPTIONS • 30-50 Charities at Launch – steady increase over 3 years • 8,000 Subscriber Base at Launch - increasing daily to > 100,000 by end Feb 2014 - and to > 128,000 by end Dec 2015 • Deal Price - €22 – 66.67% of Market Average • Initially 5 Deals per week • Deals capped at 500 Vouchers • Raising over €2.1 million+ for charity sector in 3 yrs
  • 14. FORECAST INCOME & EXPENDITURE Deal Effect 2013 2014 2015 Forecast Income & Expenditure 2013 -2015 € € € TOTAL DEAL REVENUE (000's) (000's) (000's) By 2015: Deal Deal Revenue (Merchant & Deal Effect) Charity Donations (11% of Total Deal Turnover) 2,910 360 6,673 825 7,676 949 Effect aims to Total Deal Turnover 3,270 7,498 8,625 INCOME be in top 3 Deal Effect Revenue from Deals (19%) Charity Subscriptions 621 9 1,425 6 1,639 6 daily deals site Deal Effect Total Income 630 1,431 1,645 in Ireland, EXPENDITURE Payroll Costs (incl. Employers social insurance) OSGO Software licence and support 338 131 469 300 536 345 remitting Credit/Debit Card Commission/bank fees General Marketing & PR 65 51 150 37 172 43 €2.1m+ to The Wheel (1.5% of Deal Turnover) 49 112 129 Other (incl. start up and legals) Total Expenditure 186 821 167 1,236 177 1,402 charities Surplus / (Deficit) (191) 194 242 Cash Balance at 31st December Agency Bank Account 636 828 895 Operating Bank Account 46 260 257
  • 15. BRAND STRATEGY • Brand Positioning: Aimed at more established brands and reputable merchants with a high end but broad market appeal • Consumer insight: Deal Effect saves you money, allows you to discover new experiences and feel good while doing so • ‘FairTrade’ USP: Every deal purchased contributes to a chosen charity • Core target market: Females 25-44 • Secondary target market: Adults 25-44 in Dublin, Cork and Galway
  • 16. DEALS STRATEGY • National Deals will have priority e.g. Accommodation, retailers • Best locations for deals are in Dublin, Cork and Galway • High quality sales team • Superior customer service experience • Maintain minimum of 14 days worth of deals in advance • All deals will adhere to a deal code of ethics • Deal grouping e.g. hotel,+ event ticket deals • Great deals – leverage brands • Focus on retention rates and user’s experience
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  • 23. MARKETING STRATEGY • TV - Bespoke activity • Digital advertising (online display, email capture form) • Social Media (paid, communities, targeted, competitions) • PR & Industry awareness • Search engine optimisation (SEO) • Radio • Trade marketing • Incentives to current subscribers • Working closely with charities to leverage their PR and marketing
  • 24. HOW DO WE DRIVE SALES? • Email daily deal to subscribers • Affiliate marketing sites • Deal aggregator sites • Social media offers – geographic and demographic targeting • Regular social media engagement • Pay Per Click campaign on search • Constant evaluation of sales funnel • Refer a friend
  • 25. WHERE ARE WE NOW? • Business Plan completed • Legal advice in place, finalising key documents • Recruitment drive commenced • Roll out plan for Spring 2013 – Sales Plan – Marketing Plan • Investment from charities ongoing • Donations/Interest free loans needed from private sector to reach target of €262,500
  • 27. INVESTMENT REQUIRED: €262,500 Deal Effect Funding Sources €262,500 as at 30 Jan 13 Charities committed €53,000 20% Private Investment - To Date The Wheel €85,000 32% Charities TBC €52,000 Start-up Grants TBC 20% PRIVATE SECTOR TBC €35,000 13% €25,000 €12,500 10% 5%
  • 28. INVESTMENT REQUIRED: €262,500 Deal Effect Funding Sources €262,500 as at 30 Jan 13 Charities committed €53,000 TODAY 20% Private Investment - To we are Date €120,000 The Wheel €85,000 short of 32% €262,500 Charities TBC funding for €52,000 Start-up Grants TBC 20% launch PRIVATE SECTOR TBC €35,000 13% €25,000 €12,500 10% 5%
  • 29. Vision for 2015: Deal Effect will be in top 3 daily deals site in Ireland, remitting €2.1m+ to charities. promoting equality fighting alcohol preventing suicide abuse building affordable housing protecting vulnerable coordinating children emergency relief providing sports facilities alleviating poverty fighting domestic violence helping the homeless supporting people with cancer supporting the arts training guide dogs for the blind fighting addiction fighting child promoting independence abuse for people with caring for older people promoting mental disabilities health