DRIV » Topics » Strategy

These excerpts taken from the DRIV 10-K filed Feb 19, 2009.
Strategy
 
Our objective is to be the global leader in outsourced e-commerce activities for software and digital products developers, high-tech product and computer manufacturers, and video game publishers. Our strategy for achieving this objective includes the following key components:
 
Attract New Clients and Expand Relationships with Existing Clients.  We have focused our efforts on securing new clients and expanding our relationships with existing clients primarily in the software, consumer electronics, computer game and video game markets. Our clients include software publishers, other digital content providers, high-tech product manufacturers, and online channel partners. In 2008, we entered into more than 100 new contracts with new and existing clients.
 
We believe we can attract new clients and gain additional business with existing clients by expanding the range of services we offer. This includes services to enhance the e-commerce transaction as well as additional online marketing and payment services. We believe that by expanding the size and breadth of the catalog of products we offer, we will attract additional online retailers and affiliates seeking to offer


6


Table of Contents

their customers a wide range of quality products. We currently provide e-commerce services for thousands of software and digital products publishers, high-tech products manufacturers, game publishers and affiliates.
 
Expand International Sales.  We believe there is a substantial opportunity to grow our business by enabling our clients to expand their sales through international online stores. Internet adoption and broadband deployment continue to increase rapidly, especially in the European and Asia Pacific regions. We have seen significant growth in sales for clients that have created international online stores. We intend to continue to enhance our technology platform, payment options and localized service offerings to increase sales in international markets.
 
Provide Clients with Strategic Marketing Services.  We proactively develop and deliver new strategic marketing services that are designed to help our clients improve customer acquisition and retention and maximize the lifetime value of customers. These services currently include paid search advertising, search engine optimization, affiliate marketing, store optimization, web analytics, and e-mail marketing and optimization. In general, we manage these programs for our clients and have achieved significant increases in client revenue, return-on-investment or both, compared to what clients experienced when running these programs and supporting technologies in-house or through other service providers. We intend to continue to develop and/or acquire new value-added strategic marketing services and technologies to create additional sources of revenue for our clients and for Digital River.
 
Maintain Technology Leadership.  We believe our technology platform and infrastructure afford us a competitive advantage in the market for outsourced e-commerce solutions. We intend to continue to invest in and enhance our platform to improve scalability, efficiency, reliability, security and performance. By leveraging our infrastructure, we can improve our ability to provide low-cost, high-value services while continuing to deploy the latest technologies. Additionally, we plan to continue investing in our infrastructure to enable our clients to further penetrate international markets, enhance their relationships with their customers, better manage the return-on-investment across all their online marketing activities, successfully adopt new selling models such as subscriptions, SaaS, trial programs and volume licensing programs.
 
Continue to Seek Strategic Acquisitions.  Historically, we have been an active acquirer of businesses, and we expect to continue actively pursuing acquisitions that further our business strategy. Some of the strategic factors we consider when evaluating an acquisition opportunity include: expanding our base of clients, improving the breadth and depth of our product offering, improving the catalog of content, extending our strategic marketing and other services offerings, expanding our geographic reach and diversifying our revenue stream into complementary or adjacent market segments.
 
Strategy
 
Our objective is to be the global leader in outsourced e-commerce activities for software and digital products developers, high-tech product and computer manufacturers, and video game publishers. Our strategy for achieving this objective includes the following key components:
 
Attract New Clients and Expand Relationships with Existing Clients.  We have focused our efforts on securing new clients and expanding our relationships with existing clients primarily in the software, consumer electronics, computer game and video game markets. Our clients include software publishers, other digital content providers, high-tech product manufacturers, and online channel partners. In 2008, we entered into more than 100 new contracts with new and existing clients.
 
We believe we can attract new clients and gain additional business with existing clients by expanding the range of services we offer. This includes services to enhance the e-commerce transaction as well as additional online marketing and payment services. We believe that by expanding the size and breadth of the catalog of products we offer, we will attract additional online retailers and affiliates seeking to offer


6


Table of Contents

their customers a wide range of quality products. We currently provide e-commerce services for thousands of software and digital products publishers, high-tech products manufacturers, game publishers and affiliates.
 
Expand International Sales.  We believe there is a substantial opportunity to grow our business by enabling our clients to expand their sales through international online stores. Internet adoption and broadband deployment continue to increase rapidly, especially in the European and Asia Pacific regions. We have seen significant growth in sales for clients that have created international online stores. We intend to continue to enhance our technology platform, payment options and localized service offerings to increase sales in international markets.
 
Provide Clients with Strategic Marketing Services.  We proactively develop and deliver new strategic marketing services that are designed to help our clients improve customer acquisition and retention and maximize the lifetime value of customers. These services currently include paid search advertising, search engine optimization, affiliate marketing, store optimization, web analytics, and e-mail marketing and optimization. In general, we manage these programs for our clients and have achieved significant increases in client revenue, return-on-investment or both, compared to what clients experienced when running these programs and supporting technologies in-house or through other service providers. We intend to continue to develop and/or acquire new value-added strategic marketing services and technologies to create additional sources of revenue for our clients and for Digital River.
 
Maintain Technology Leadership.  We believe our technology platform and infrastructure afford us a competitive advantage in the market for outsourced e-commerce solutions. We intend to continue to invest in and enhance our platform to improve scalability, efficiency, reliability, security and performance. By leveraging our infrastructure, we can improve our ability to provide low-cost, high-value services while continuing to deploy the latest technologies. Additionally, we plan to continue investing in our infrastructure to enable our clients to further penetrate international markets, enhance their relationships with their customers, better manage the return-on-investment across all their online marketing activities, successfully adopt new selling models such as subscriptions, SaaS, trial programs and volume licensing programs.
 
Continue to Seek Strategic Acquisitions.  Historically, we have been an active acquirer of businesses, and we expect to continue actively pursuing acquisitions that further our business strategy. Some of the strategic factors we consider when evaluating an acquisition opportunity include: expanding our base of clients, improving the breadth and depth of our product offering, improving the catalog of content, extending our strategic marketing and other services offerings, expanding our geographic reach and diversifying our revenue stream into complementary or adjacent market segments.
 
Strategy


 



Our objective is to be the global leader in outsourced
e-commerce
activities for software and digital products developers,
high-tech product and computer manufacturers, and video game
publishers. Our strategy for achieving this objective includes
the following key components:


 



Attract New Clients and Expand Relationships with Existing
Clients.
  We have focused our efforts on securing
new clients and expanding our relationships with existing
clients primarily in the software, consumer electronics,
computer game and video game markets. Our clients include
software publishers, other digital content providers, high-tech
product manufacturers, and online channel partners. In 2008, we
entered into more than 100 new contracts with new and existing
clients.


 



We believe we can attract new clients and gain additional
business with existing clients by expanding the range of
services we offer. This includes services to enhance the
e-commerce
transaction as well as additional online marketing and payment
services. We believe that by expanding the size and breadth of
the catalog of products we offer, we will attract additional
online retailers and affiliates seeking to offer





6





Table of Contents






their customers a wide range of quality products. We currently
provide
e-commerce
services for thousands of software and digital products
publishers, high-tech products manufacturers, game publishers
and affiliates.


 



Expand International Sales.  We believe there
is a substantial opportunity to grow our business by enabling
our clients to expand their sales through international online
stores. Internet adoption and broadband deployment continue to
increase rapidly, especially in the European and Asia Pacific
regions. We have seen significant growth in sales for clients
that have created international online stores. We intend to
continue to enhance our technology platform, payment options and
localized service offerings to increase sales in international
markets.


 



Provide Clients with Strategic Marketing
Services.
  We proactively develop and deliver new
strategic marketing services that are designed to help our
clients improve customer acquisition and retention and maximize
the lifetime value of customers. These services currently
include paid search advertising, search engine optimization,
affiliate marketing, store optimization, web analytics, and
e-mail
marketing and optimization. In general, we manage these programs
for our clients and have achieved significant increases in
client revenue,
return-on-investment
or both, compared to what clients experienced when running these
programs and supporting technologies in-house or through other
service providers. We intend to continue to develop
and/or
acquire new value-added strategic marketing services and
technologies to create additional sources of revenue for our
clients and for Digital River.


 



Maintain Technology Leadership.  We believe our
technology platform and infrastructure afford us a competitive
advantage in the market for outsourced
e-commerce
solutions. We intend to continue to invest in and enhance our
platform to improve scalability, efficiency, reliability,
security and performance. By leveraging our infrastructure, we
can improve our ability to provide low-cost, high-value services
while continuing to deploy the latest technologies.
Additionally, we plan to continue investing in our
infrastructure to enable our clients to further penetrate
international markets, enhance their relationships with their
customers, better manage the
return-on-investment
across all their online marketing activities, successfully adopt
new selling models such as subscriptions, SaaS, trial programs
and volume licensing programs.


 



Continue to Seek Strategic
Acquisitions.
  Historically, we have been an
active acquirer of businesses, and we expect to continue
actively pursuing acquisitions that further our business
strategy. Some of the strategic factors we consider when
evaluating an acquisition opportunity include: expanding our
base of clients, improving the breadth and depth of our product
offering, improving the catalog of content, extending our
strategic marketing and other services offerings, expanding our
geographic reach and diversifying our revenue stream into
complementary or adjacent market segments.


 




Strategy


 



Our objective is to be the global leader in outsourced
e-commerce
activities for software and digital products developers,
high-tech product and computer manufacturers, and video game
publishers. Our strategy for achieving this objective includes
the following key components:


 



Attract New Clients and Expand Relationships with Existing
Clients.
  We have focused our efforts on securing
new clients and expanding our relationships with existing
clients primarily in the software, consumer electronics,
computer game and video game markets. Our clients include
software publishers, other digital content providers, high-tech
product manufacturers, and online channel partners. In 2008, we
entered into more than 100 new contracts with new and existing
clients.


 



We believe we can attract new clients and gain additional
business with existing clients by expanding the range of
services we offer. This includes services to enhance the
e-commerce
transaction as well as additional online marketing and payment
services. We believe that by expanding the size and breadth of
the catalog of products we offer, we will attract additional
online retailers and affiliates seeking to offer





6





Table of Contents






their customers a wide range of quality products. We currently
provide
e-commerce
services for thousands of software and digital products
publishers, high-tech products manufacturers, game publishers
and affiliates.


 



Expand International Sales.  We believe there
is a substantial opportunity to grow our business by enabling
our clients to expand their sales through international online
stores. Internet adoption and broadband deployment continue to
increase rapidly, especially in the European and Asia Pacific
regions. We have seen significant growth in sales for clients
that have created international online stores. We intend to
continue to enhance our technology platform, payment options and
localized service offerings to increase sales in international
markets.


 



Provide Clients with Strategic Marketing
Services.
  We proactively develop and deliver new
strategic marketing services that are designed to help our
clients improve customer acquisition and retention and maximize
the lifetime value of customers. These services currently
include paid search advertising, search engine optimization,
affiliate marketing, store optimization, web analytics, and
e-mail
marketing and optimization. In general, we manage these programs
for our clients and have achieved significant increases in
client revenue,
return-on-investment
or both, compared to what clients experienced when running these
programs and supporting technologies in-house or through other
service providers. We intend to continue to develop
and/or
acquire new value-added strategic marketing services and
technologies to create additional sources of revenue for our
clients and for Digital River.


 



Maintain Technology Leadership.  We believe our
technology platform and infrastructure afford us a competitive
advantage in the market for outsourced
e-commerce
solutions. We intend to continue to invest in and enhance our
platform to improve scalability, efficiency, reliability,
security and performance. By leveraging our infrastructure, we
can improve our ability to provide low-cost, high-value services
while continuing to deploy the latest technologies.
Additionally, we plan to continue investing in our
infrastructure to enable our clients to further penetrate
international markets, enhance their relationships with their
customers, better manage the
return-on-investment
across all their online marketing activities, successfully adopt
new selling models such as subscriptions, SaaS, trial programs
and volume licensing programs.


 



Continue to Seek Strategic
Acquisitions.
  Historically, we have been an
active acquirer of businesses, and we expect to continue
actively pursuing acquisitions that further our business
strategy. Some of the strategic factors we consider when
evaluating an acquisition opportunity include: expanding our
base of clients, improving the breadth and depth of our product
offering, improving the catalog of content, extending our
strategic marketing and other services offerings, expanding our
geographic reach and diversifying our revenue stream into
complementary or adjacent market segments.


 




These excerpts taken from the DRIV 10-K filed Feb 29, 2008.
Strategy
 
Our objective is to be the global leader in outsourced e-commerce services for software and digital products developers, high-tech product manufacturers, computer and video games, and related online retailers. Our strategy for achieving this objective includes the following key components:
 
Attract New Clients and Expand Relationships with Existing Clients.  We have focused our efforts on securing new clients and expanding our relationships with existing clients primarily in the software, digital products, high-tech products, consumer electronics, and computer and video game markets. Our clients include software publishers, other digital content providers, high-tech product manufacturers, and online channel partners such as retailers. In 2007, we entered into more than 100 new contracts with new and existing clients.
 
We believe we can attract new clients and gain additional business with existing clients by expanding the range of services we offer. This includes services to enhance the e-commerce transaction as well as additional online marketing services. We believe that by expanding the size and breadth of the catalog of products we offer, we will attract additional online retailers and affiliates seeking to offer their customers a wide range of quality products. As of February 1, 2008, we were providing e-commerce services for thousands of software and digital products publishers, high-tech products manufacturers, online retailers and affiliates.
 
We believe we have amassed the largest catalog of digital software titles available anywhere online, which we offer to online retailers and affiliates. We generate revenue when web traffic is directed to a site for which we provide e-commerce services and a purchase transaction occurs. We will continue to expand the content available in our catalog, which we believe will make that catalog increasingly attractive to online retailers, affiliates and other online channel partners. We believe the Digital River oneNetwork is a unique marketplace and provides opportunities to grow our revenues and strengthen our relationships with clients and partners.


6


Table of Contents

Expand International Sales.  We believe there is a substantial opportunity to grow our business by enabling our clients to expand their sales through international online stores. Internet adoption and broadband deployment continue to increase rapidly, especially in the European and Asia Pacific regions. We have seen significant growth in sales for clients that have created international online stores. We intend to continue to enhance our technology platform, payment options and localized service offerings to increase sales in international markets.
 
Provide Clients with Strategic Marketing Services.  We proactively develop and deliver new products and services, called strategic marketing services that are designed to help our clients improve customer acquisition and retention and maximize the lifetime value of customers. These services currently include paid search advertising, search engine optimization, affiliate marketing, store optimization, and e-mail marketing and optimization. In general, we manage these programs for our clients and have achieved significant increases in client revenue, return-on-investment or both, compared to what clients experienced when running these programs and supporting technologies in-house. We intend to continue to develop and/or acquire new value-added strategic marketing services and technologies to create additional sources of revenue for our clients and for Digital River.
 
Maintain Technology Leadership.  We believe our technology platform and infrastructure afford us a competitive advantage in the market for outsourced e-commerce solutions. We intend to continue to invest in and enhance our platform to improve scalability, efficiency, reliability, security and performance as well as reduce costs. By leveraging our fixed cost structure, we can improve our ability to provide low-cost, high-value services while continuing to deploy the latest technologies. Additionally, we plan to continue investing in our infrastructure to enable our clients to further penetrate international markets, enhance their relationships with their customers, better manage the return-on-investment across all their online marketing activities, successfully adopt new selling models such as subscriptions, “software-as-a-service,” “try-before-you-buy” and volume licensing.
 
Continue to Seek Strategic Acquisitions.  Historically, we have been an active acquirer of businesses, and we expect to continue actively pursuing acquisitions that further our business strategy. Some of the strategic factors we consider when evaluating an acquisition opportunity include: expanding our base of clients, improving the breadth and depth of our product offering, improving the catalog of content, extending our strategic marketing and other services offerings, expanding our geographic reach and diversifying our revenue stream into complementary or adjacent market segments.
 
Expand the Digital River oneNetwork Marketplace.  We have developed a global marketplace we call Digital River oneNetwork which enables our clients to efficiently offer their products to a broad range of online retailers and affiliates. Affiliates are entities (individuals, organizations, companies, etc.) that generate online traffic to specific websites. On those websites, there are links, advertisements and other offers to sell various products and services. If a visitor clicks one of the links or advertisements and subsequently makes a purchase, the affiliate receives a commission in the form of a fixed fee or a percentage of the selling price of the product(s) purchased. Affiliates are an increasingly important source of website traffic as they can target specific types of Internet users.
 
Strategy


 



Our objective is to be the global leader in outsourced
e-commerce
services for software and digital products developers, high-tech
product manufacturers, computer and video games, and related
online retailers. Our strategy for achieving this objective
includes the following key components:


 



Attract New Clients and Expand Relationships with Existing
Clients.
  We have focused our efforts on securing
new clients and expanding our relationships with existing
clients primarily in the software, digital products, high-tech
products, consumer electronics, and computer and video game
markets. Our clients include software publishers, other digital
content providers, high-tech product manufacturers, and online
channel partners such as retailers. In 2007, we entered into
more than 100 new contracts with new and existing clients.


 



We believe we can attract new clients and gain additional
business with existing clients by expanding the range of
services we offer. This includes services to enhance the
e-commerce
transaction as well as additional online marketing services. We
believe that by expanding the size and breadth of the catalog of
products we offer, we will attract additional online retailers
and affiliates seeking to offer their customers a wide range of
quality products. As of February 1, 2008, we were providing
e-commerce
services for thousands of software and digital products
publishers, high-tech products manufacturers, online retailers
and affiliates.


 



We believe we have amassed the largest catalog of digital
software titles available anywhere online, which we offer to
online retailers and affiliates. We generate revenue when web
traffic is directed to a site for which we provide
e-commerce
services and a purchase transaction occurs. We will continue to
expand the content available in our catalog, which we believe
will make that catalog increasingly attractive to online
retailers, affiliates and other online channel partners. We
believe the Digital River oneNetwork is a unique marketplace and
provides opportunities to grow our revenues and strengthen our
relationships with clients and partners.





6





Table of Contents






Expand International Sales.  We believe there
is a substantial opportunity to grow our business by enabling
our clients to expand their sales through international online
stores. Internet adoption and broadband deployment continue to
increase rapidly, especially in the European and Asia Pacific
regions. We have seen significant growth in sales for clients
that have created international online stores. We intend to
continue to enhance our technology platform, payment options and
localized service offerings to increase sales in international
markets.


 



Provide Clients with Strategic Marketing
Services.
  We proactively develop and deliver new
products and services, called strategic marketing services that
are designed to help our clients improve customer acquisition
and retention and maximize the lifetime value of customers.
These services currently include paid search advertising, search
engine optimization, affiliate marketing, store optimization,
and e-mail
marketing and optimization. In general, we manage these programs
for our clients and have achieved significant increases in
client revenue,
return-on-investment
or both, compared to what clients experienced when running these
programs and supporting technologies in-house. We intend to
continue to develop
and/or
acquire new value-added strategic marketing services and
technologies to create additional sources of revenue for our
clients and for Digital River.


 



Maintain Technology Leadership.  We believe our
technology platform and infrastructure afford us a competitive
advantage in the market for outsourced
e-commerce
solutions. We intend to continue to invest in and enhance our
platform to improve scalability, efficiency, reliability,
security and performance as well as reduce costs. By leveraging
our fixed cost structure, we can improve our ability to provide
low-cost, high-value services while continuing to deploy the
latest technologies. Additionally, we plan to continue investing
in our infrastructure to enable our clients to further penetrate
international markets, enhance their relationships with their
customers, better manage the
return-on-investment
across all their online marketing activities, successfully adopt
new selling models such as subscriptions,
“software-as-a-service,”
“try-before-you-buy” and volume licensing.


 



Continue to Seek Strategic
Acquisitions.
  Historically, we have been an
active acquirer of businesses, and we expect to continue
actively pursuing acquisitions that further our business
strategy. Some of the strategic factors we consider when
evaluating an acquisition opportunity include: expanding our
base of clients, improving the breadth and depth of our product
offering, improving the catalog of content, extending our
strategic marketing and other services offerings, expanding our
geographic reach and diversifying our revenue stream into
complementary or adjacent market segments.


 



Expand the Digital River oneNetwork
Marketplace.
  We have developed a global
marketplace we call Digital River oneNetwork which enables our
clients to efficiently offer their products to a broad range of
online retailers and affiliates. Affiliates are entities
(individuals, organizations, companies, etc.) that generate
online traffic to specific websites. On those websites, there
are links, advertisements and other offers to sell various
products and services. If a visitor clicks one of the links or
advertisements and subsequently makes a purchase, the affiliate
receives a commission in the form of a fixed fee or a percentage
of the selling price of the product(s) purchased. Affiliates are
an increasingly important source of website traffic as they can
target specific types of Internet users.


 




This excerpt taken from the DRIV 10-K filed Mar 1, 2007.
Strategy
 
Our objective is to be the global leader in outsourced e-commerce services for software and digital products developers, high-tech product manufacturers and related online retailers. Our strategy for achieving this objective includes the following key components:
 
Attract New Clients and Expand Relationships with Existing Clients.  We have focused our efforts on securing new clients and expanding our relationships with existing clients primarily in the software, digital products, high-tech products, and consumer electronics markets. Our clients include software publishers, other digital content providers, high-tech product manufacturers, and online channel partners such as retailers. In 2006, we entered into more than 230 new contracts with new and existing clients.
 
We believe we can attract new clients and gain additional business with existing clients by expanding the range of services we offer. This includes services to enhance the e-commerce transaction as well as additional online marketing services. We believe that by expanding the size and breadth of the catalog of products we offer, we will attract additional online retailers and affiliates seeking to offer their customers a wide range of quality products. As of February 1, 2007, we were providing e-commerce services for more than 44,000 software and digital products publishers, high-tech products manufacturers, online retailers and affiliates.
 
We believe we have amassed the largest catalog of digital software titles available anywhere online, and we offer these titles to online retailers and affiliates. We generate revenue when web traffic is directed to a site for which we provide e-commerce services and a purchase transaction occurs. We will continue to expand the content available in our catalog, which we believe will make that catalog increasingly attractive to online retailers, affiliates and other online channel partners. We believe the Digital River oneNetwork is a unique marketplace and provides opportunities to grow our revenues and strengthen our relationships with clients and partners.


9


Table of Contents

 
Expand International Sales.  We believe there is a substantial opportunity to grow our business by enabling our clients to expand their sales through international online stores. Internet adoption and broadband deployment continue to increase rapidly in the European and Asia Pacific regions. We have seen significant growth in sales for clients that have created international online stores and we intend to continue to enhance our technology platform, payment options and localized service offerings to increase sales in international markets.
 
Provide Clients with Strategic Marketing Services.  We proactively develop and deliver new products and services, called strategic marketing services that are designed to help our clients improve customer acquisition and retention and maximize the lifetime value of customers. These services currently include paid search advertising, search engine optimization, affiliate marketing, store optimization, and e-mail marketing and optimization. In general, we manage these programs for our clients and have achieved significant increases in client revenue, return-on-investment or both, compared to what clients experienced when running these programs and supporting technologies in-house. We intend to continue to develop and/or acquire new value-added strategic marketing services and technologies to create additional sources of revenue for our clients and for Digital River.
 
Maintain Technology Leadership.  We believe our technology platform and infrastructure afford us a competitive advantage in the market for outsourced e-commerce solutions. We intend to continue to invest in and enhance our platform to improve scalability, reliability, security and performance as well as reduce costs. By leveraging our fixed cost structure, we can improve our ability to provide low-cost, high-value services while continuing to deploy the latest technologies. Additionally, we plan to continue investing to enable our clients to further penetrate international markets, enhance their relationships with their customers, better manage the return-on-investment across all their online marketing activities, and successfully adopt new selling models such as subscriptions, “software-as-a-service,” “try-before-you-buy” and volume licensing.
 
Continue to Seek Strategic Acquisitions.  Historically, we have been an active acquirer of businesses, and we expect to continue actively pursuing acquisitions that further our business strategy. Some of the strategic factors we consider when evaluating an acquisition opportunity include: expanding our base of clients, improving the breadth and depth of our product offering, improving the catalog of content, extending our strategic marketing and other services offerings, expanding our geographic reach and diversifying our revenue stream into complementary or adjacent market segments.
 
Expand the Digital River oneNetwork Marketplace.  We have developed a global marketplace we call Digital River oneNetwork which enables our clients to efficiently offer their products to a broad range of online retailers and affiliates. Affiliates are entities (individuals, organizations, companies, etc.) that generate online traffic to specific websites. On those websites, there are links, advertisements and other offers to sell various products and services. If a visitor clicks one of the links or advertisements and subsequently makes a purchase, the affiliate receives a commission in the form of a fixed fee or a percentage of the selling price of the product(s) purchased. Affiliates are an increasingly important source of website traffic as they can target specific types of Internet users.
 
This excerpt taken from the DRIV 10-K filed Mar 16, 2005.
Strategy

Our objective is to be the global leader in e-commerce outsourcing for software and digital products publishers, manufacturers, online retailers and online channel partners.

We intend to achieve our objective through the following key strategies:

Attract New Clients and Expand Relationships With Existing Clients.   We intend to focus our efforts on securing new relationships and expanding our existing relationships with software publishers, manufacturers, online retailers and online channel partners. In 2004, we entered into contracts with Circuit City Stores, Inc., CompUSA, Computer Associates International, Inc., eBay, Inc., Microsoft Corporation, Newegg.com, PC Universe, Inc., and the Digital Products Division of Toshiba America Information Systems, Inc. By further increasing the range of products, services and pricing alternatives we offer, we intend to attract new clients and secure additional business from our existing clients. Furthermore, by increasing the size of our software and digital products catalog through new client relationships, we believe we will continue to attract new online retailers, content sites and portals. As of March 1, 2005, we were providing e-commerce services for more than 40,000 software and digital products publishers, manufacturers, online retailers and online channel partners.

Expand International Sales.   We believe that there is a substantial opportunity to grow our business by expanding existing and new client sales through international online stores. Internet adoption, broadband penetration and e-commerce sales growth continue to show rapid growth in the European and Asia-Pacific regions. We have seen significant growth in sales for those clients that have offered international stores and we intend to continue to enhance our technology platform and services to increase sales in these regions of the world. We plan to continue to expand our support for international stores with new payment methods, shipping options and on-the-ground operational support.

Leverage The Digital River Sales Network To Expand Sales Opportunities For Our Clients.   We believe we have amassed one of the largest catalogs of software and digital products in the industry as a result of our client relationships. By making this catalog available to our large network of online channel partners, which includes online retailers, content sites, portals and entrepreneurs, we believe we can further grow our clients’ sales by delivering a large, global network of buyers. We plan to continue to aggressively expand our catalog of products, pursue new online partners and expand our offering of programs and tools to allow our clients to sell their products through our vast partner network. We believe our network is

5




unique in the marketplace, provides significant revenue opportunities and will help us build stronger relationships with our clients.

Drive Growth Through Aggressive Merchandising and Marketing.   We believe that we have developed technology, services, expertise and best practices in the areas of marketing and merchandising that can help our clients grow their online businesses by utilizing numerous proven tools and programs and our expanding data warehouse of end-user purchasing information to increase traffic, close ratios, average order sizes and repeat purchases. We will continue to develop and utilize a wide range of marketing and merchandising programs and our growing data warehouse of end-user purchasing information to help grow our clients’ businesses.

Provide Clients With Strategic Marketing Services.   We proactively develop and deliver new products and services designed to help our clients increase their customer acquisition and retention and maximize lifetime value. We have launched several strategic marketing services such as paid search advertising, search engine optimization, affiliate marketing, site/store optimization and email marketing/optimization. With these Digital River-managed programs, we have achieved significant improvements in revenue, return-on-investment or both, in comparison to what our clients accomplished on their own. We plan to continue to aggressively develop and offer new value-added strategic marketing services and supporting technologies to create additional sources of recurring revenue for our clients and for Digital River.

Expand the Breadth and Use of Our Remote Control Tool Set.   We will continue to expand our remote control tool set to give our clients more hands-on control over their site on a day-to-day basis and give us more time to help our clients launch more strategic revenue-generating programs.

Provide Clients With Flexible Solution Options.   We offer our clients a wide range of service options from a simple shopping cart solution to an end-to-end e-commerce store. This approach is designed to give our clients a variety of choices based upon their specific needs. We plan to continue expanding the solution choices we offer our clients to provide even more alternatives and the option to expand their services as their needs grow.

Maintain Technology Leadership.   We believe that our technology infrastructure and platform have given us a competitive advantage in the market for e-commerce outsourcing solutions. In 2004, we expanded our technology footprint to include advanced optimization, web analytics and email marketing capabilities designed to help our clients further attract, retain and maximize the lifetime value of their customers. We plan to continue to invest in and enhance our platform in order to increase functionality, reliability, scalability and performance and reduce costs. By leveraging our fixed-cost infrastructure, we will improve our ability to provide low cost, high value services to our clients while utilizing the latest technology. Additionally, we plan to continue to develop and enhance our technology to allow our clients to support new sales models, enhance their relationship with their customers and address new market segments through try-before-you-buy sales, subscription sales, volume licensing, digital rights management and license management, among others.

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