DemandTec and Connect3 Join Forces to Offer End-to-End Retail Promotion Management

Paul Demery

Alliance of Industry`s Leading Vendors Will Provide Retailers with Best-in-Class Promotion Planning, Optimization, and Execution Capabilities

SAN CARLOS, Calif. – April 25, 2006 – DemandTec, Inc., the leading provider of Consumer-Centric Merchandising software for retailers, today announced a new partnership with Connect3 Systems, Inc., the leading provider of enterprise Advertising, Merchandising, and Promotion (AMP) software solutions for retailers.

DemandTec and Connect3 provide solutions in the fastest developing segments of a rapidly growing retail software industry. According to AMR Research in a 2005 report, “Retailers are putting greater priority on technology that has an effect on top-line performance and the consumer experience . . . with 33% of participating retailers citing demand intelligence as the top priority.”

As a result of this alliance, the two companies will offer joint solutions combining DemandTec`s Consumer-Centric promotion planning and optimization capabilities with Connect3`s industry-leading Advertising, Merchandising, and Promotion solutions, featuring best-in-class versioning and advertising execution.

“We’re extremely enthusiastic about this new partnership,” said Dale Byrne, CEO of Connect3. "We share several industry-leading customers with DemandTec, and their consumer-centric approach to merchandising is a perfect fit with our own flexible AMP framework and versioning capabilities, allowing us to offer outstanding solutions to retailers of all sizes.”

“Both DemandTec and Connect3 are key solutions supporting our customer-centricity strategy,” said Susan DuSchane, director of merchandising operations, Best Buy. “There is good synergy between their respective solutions, which together can enable fully integrated promotion planning, optimization, and execution processes.”

DemandTec provides software for Consumer-Centric Merchandising - a strategic and targeted approach to planning and optimizing pricing, promotions, and other merchandising plans based on powerful consumer, demand, and market intelligence. DemandTec Promotion enables retailers to plan and optimize advertised and unadvertised promotions based on detailed modeling of price, ad, display, seasonality, and other merchandising conditions that influence consumer demand.

Connect3’s AMP Performance Series provides a visual environment to plan, manage, and execute versioned cross-channel promotions and in-store promotional displays. This allows merchandising, marketing, and advertising departments to collaborate cross-functionally to deliver promotions that are customer-centric and coordinated across touchpoints.

"We’re excited about the impact this partnership will have for our current and future joint customers,” said Dan Fishback, CEO of DemandTec. “Previously, retailers seeking an end-to-end solution for promotion planning, optimization, and execution have not found an integrated solution with a full feature set. Now, with two respective leaders joining forces, our customers will benefit from end-to-end integration as well as from the best-in-class functionality that both DemandTec and Connect3 are already providing."

Based on the DemandTec Consumer-Centric Merchandising platform and the Connect3 AMP framework, the DemandTec and Connect3 offerings provide retailers with a complete solution for promotion planning, optimization, and execution, including:

• Promotion Planning - DemandTec and Connect3 applications will jointly provide capabilities and workflow to facilitate promotion planning that supports a retailer’s business requirements. Retailers can use DemandTec to assess promotional strategies in conjunction with base pricing strategies and to build a Master Merchandising Calendar, integrating price, promotion, and markdown plans. Retailers can use Connect3’s collaborative versioning and layout capabilities to efficiently plan and coordinate promotions between the merchandising and advertising departments.

• Promotion Optimization - DemandTec`s best-in-class platform of consumer, demand, and market intelligence is used to model consumer demand at the store-SKU level and to incorporate segment-specific market-basket analytics, allowing retailers to evaluate and forecast promotional effectiveness, cannibalization, pull-through effects, and cross-category effects under any combination of simulated merchandising conditions. Merchants can finalize promotion plans using advanced “what-if” simulation to predict and optimize promotion variables, such as price point and merchandising support.

• Promotion Execution - Connect3`s best-in-class AMP framework will receive optimized promotion details from DemandTec, including zone-specific or store-specific pricing and items to be advertised or featured in-store. Connect3 then provides a visual environment to plan and manage the complex promotion execution process. Connect3 will further analyze the cost-effectiveness of various advertising decisions, manage the message to the customer across touchpoints, view and manage versioned offer details, and provide advertising with all digital content and publishing processes. Connect3 will manage the workflow of this process with internal and external resources and tasks, and interface any downstream changes back to DemandTec to reforecast and update causal data used in future forecasts.

About Connect3 Systems
Connect3 Systems, Inc. is the leading provider of enterprise Advertising, Merchandising, and Promotion (AMP) software solutions for retailers. For over 12 years, Connect3 has partnered with leading retailers to develop a highly configurable AMP framework that, combined with Connect3 Professional Services, supports advanced promotion planning, collaborative calendaring and workflow, and versioned advertising execution. Connect3 customers include Best Buy, The Home Depot, PETCO, Shopko, Academy Sports & Outdoors, ACE Hardware, Circuit City, Office Depot, Giant Eagle, CompUSA, Stop and Shop, Wild Oats, and others. For more information, please visit http://www.connect3.com or telephone (562) 741-0380.

About DemandTec
DemandTec`s Consumer-Centric Merchandising, Sales and Marketing software helps retailers and consumer products manufacturers strategically plan, optimize, and execute consumer-centric merchandising and marketing programs based on a quantified understanding of consumer demand. DemandTec customers include B&Q;, Best Buy, Brookshire Grocery Company, Delhaize America, Duane Reade, Giant-Carlisle, Giant Eagle, H-E-B Grocery Co., Longs Drugs, Monoprix, Piggly Wiggly Carolina Company, RadioShack, and Safeway. For more information, please visit www.demandtec.com.

Media Contacts:

Cassandra Moren
DemandTec, Inc.
(650) 226-4690 cassandra.moren@demandtec.com

Margaret Austin Byrne
Connect3 Systems, Inc.
(310) 809-6607 maustinbyrne@connect3.com

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advertising, DemandTec, Merchandising, optimization, Retailing