Although there are numerous studies leading up to the holiday season that attempt to forecast what retailers can expect, few explore how consumers actually thought online retailers performed immediately after the fact. The survey set out to learn consumers’ satisfaction with their digital experience across a number of key areas, including retailers’ product merchandising approaches, behavioral retargeting and privacy practices, mobile and social features, and offers and promotions.

1. Baynote Holiday Online Shopping Experience SurveyIndependently Conducted by Conduit Systems January 2011

2. Reason for Conducting Survey Although there are numerous studies leading up to the holiday season that attempt to forecast what retailers can expect, few explore how consumers actually thought online retailers performed immediately after the fact. The survey set out to learn consumers’ satisfaction with their digital experience across a number of key areas, including retailers’ product merchandising approaches, behavioral retargeting and privacy practices, mobile and social features, and offers and promotions. Baynote Holiday Online Shopping Experience Survey – January 2011 3 About the Survey Survey Methodology Sample Size: 500 U.S. online holiday shoppers Timeframe: 3 weeks leading up to Dec. 28, 2010 Margin of Error: 4.4%

3. “The results from the Baynote Holiday Online Experience Survey indicate that while consumers had a satisfactory online experience this season overall, in very few areas did retailers exceed customer expectations, with site search and navigation being called out as the top areas for improvement.” Carlos Carvajal, VP of Marketing, Baynote Baynote Holiday Online Shopping Experience Survey – January 2011 4 Results Summary 55 % of online holiday shoppers rated their online shopping experience as “good,” equivalent to a “B” grade Shoppers name e-commerce website navigation and site search as features retailers need to improve most, at 57% and 54% respectively 84% of online holiday shoppers were either hesitant or unwilling to share personal information with retailers to personalize their online experience 58% of online holiday shoppers experienced retargeting this season; 48% say retargeting turns them off from retailers Retailers’ on-site and e-mail promotions influenced majority of purchase decisions Mobile and social media promotions show promise, but adoption for online shopping among consumers in these channels has not gone mainstream yet

4. Q: Please rate your overall online shopping experience this holiday season. SUMMARY: Overall, online retailers got a “B” Grade equivalent from consumers, with 55% rating their online shopping experience as “good.” Baynote Holiday Online Shopping Experience Survey – January 2011 5 Overall Experience

5. Q: Thinking about all aspects of shopping this holiday season, when comparing it to last year’s holiday season, would you say your experience improved, stayed about the same, or got worse? SUMMARY: 51% said their experience was the same this year compared to 46% who said it improved. Baynote Holiday Online Shopping Experience Survey – January 2011 6 Overall Experience

6. Q: Did you experience any “retargeting” techniques by advertisers this holiday shopping season? Retargeting is defined as the practice of targeting a consumer with advertisements after they clicked on a product or promotion on their website but did not end up making a purchase. For example, if you were shopping on Target.com for a Nintendo Wii but did not purchase it, you would see ads for Nintendo Wii on other unrelated sites that you visit in the future. Baynote Holiday Online Shopping Experience Survey – January 2011 7 Retargeting and Privacy

7. Q: Whether you experienced retargeted ads or not, please indicate whether you agree or disagree with each of the following statements as they relate to the idea of retargeting. (numbers are percentages of each statement) Baynote Holiday Online Shopping Experience Survey – January 2011 8 Retargeting and Privacy

8. Q: How likely are you to share personal information for the sake of getting a more personalized shopping experience? SUMMARY: Shoppers are for the most part unwilling to disclose personal information for more personalization. Only 16% said they would definitely share their personal information to have a more personalized experience. Baynote Holiday Online Shopping Experience Survey – January 2011 9 Retargeting and Privacy

9. Q: Thinking of the holiday shopping you have done so far this season, how much were your purchases/shopping activities influenced by promotions delivered through each of the following methods? (numbers are percentages of each statement) Baynote Holiday Online Shopping Experience Survey January 2011 10 Offers and Promotions

10. Q: Rate the relevance of the promotions delivered to you as it relates to your online shopping experience this holiday season. SUMMARY: Retailers can definitely improve on making their promotions more relevant for holiday shoppers. 43% of shoppers deemed retailers’ promotions average, fair or poor Baynote Holiday Online Shopping Experience Survey – January 2011 11 Offers and Promotions *Numbers revealed in percentages

11. Q: Did you use your mobile phone to do research and comparison shopping this holiday season? Q: Did you use your mobile phone to make any purchases this holiday season? Baynote Holiday Online Shopping Experience Survey – January 2011 12 Mobile and Social Media *Numbers revealed in percentages

12. Baynote Holiday Online Shopping Experience Survey – January 2011 13 Mobile and Social Media Q: What are the key reasons you purchased products via a mobile phone as compared to via a computer? Select all that apply. SUMMARY: Convenience was the largest reason for purchasing via mobile phones, at 68%. The second most popular factor was there was a time-sensitive promotion, at 46%.

13. Baynote Holiday Online Shopping Experience Survey – January 2011 14 Mobile and Social Media Q: Which of the following reasons apply to why you did not purchase products via your mobile phone? Select all that apply. SUMMARY: Consumers who did not make mobile purchases indicated it was mostly because their computers were more convenient, at 51%, and 26% said it was due to security concerns. *Numbers revealed in percentages

14. Q: When thinking of your favorite ecommerce sites, indicate how important each of the following features are to making your visits a positive experience. SUMMARY: Excellent site navigation is most valued by consumers, with 58% saying it is very important to them. It’s followed closely by site search at 53%. Baynote Holiday Online Shopping Experience Survey – January 2011 15 Product Merchandising *Numbers revealed in percentages

15. Q: Thinking of your experience so far this holiday season, what features do you feel need to be improved to enhance your shopping in the future? Select all that apply. SUMMARY: Next year, shoppers would most like to see retailers improve their navigation (57%) and site search (54%). Baynote Holiday Online Shopping Experience Survey – January 2011 16 Product Merchandising 57% 54% 51% 36% 9%

16. Q: Which of the following experiences caused you to abandon an ecommerce site while shopping this holiday? Select all that apply. Q: During this holiday season, have you abandoned an ecommerce site while shopping? Baynote Holiday Online Shopping Experience Survey – January 2011 17 Product Merchandising *Numbers revealed in percentages

17. Q: Thinking about this holiday season , did you purchase something different and/or in addition to what you were originally looking for? Q: What motivated you to make that additional purchase(s)? Select all that apply Baynote Holiday Online Shopping Experience Survey – January 2011 18 Product Merchandising *Numbers revealed in percentages

18. About Baynote - http://www.baynote.com Baynote provides personalization and digital marketing optimization solutions that power the adaptive web, an emerging standard in customer experience that is always personal, relevant and convenient. By observing engagement patterns among like-minded individuals to understand user intent, the Baynote Adaptive Web Suite™ automatically optimizes and adapts the online experience, leading to increased conversions, revenue and loyalty. Baynote’s customers include: AT&T, CA, Dell, Expedia, Intuit, Fox, Urban Outfitters and VEVO. The company is based in San Jose, Calif. with additional offices in the U.K. and Germany. Confidential & Proprietary 19 About Baynote For more information on this study, contact Shannon Hutto (415) 503-1818 baynote@bateman-group.com