Marketing Executives Council November 5, 2009

Marketing Executives Council 2 August 13, 2009 Changing of the Guard THANK YOU to Brian Altenberger for his leadership the past three years and as Chairman in 2009 ~~~ Congratulations and welcome to our new MEC leadership team: Barry Harris, Chairman Scott Howat, Vice Chairman Kevin Burton, Board of Governors (1-year term) Rob Christy, Board of Governors (2-year term) ~~~

Marketing Executives Council 3 August 13, 2009 Today’s Agenda  Welcome and Introductions – Barry Harris  Review of Anti-trust guidelines – Jack Cameron  Council Business – Jack Cameron  Auto Industry & Effect on the Aftermarket – Room 705 Bob McKenna, Steve Handschuh, Mike Hanley  Break – Reconvene in Room 603  Utilization of VIO Data – Jeff Canty & Marty Miller, Experian  Business Intelligence – Matt Krimple, Mitchell 1  AAPEX IPR Update – Sarah Bruno  Market Pulse Q3 Results – Jack Cameron  Supplier Image Task Force Update – Brian Tarnacki  Close & Adjourn – Barry Harris

Marketing Executives Council 4 August 13, 2009 Mission Statement To advance the automotive aftermarket supplier industry through collaborative marketing and communication solutions. Purpose Forum for aftermarket supplier marketing executives to collaborate in helping improve the state and image of the North American manufacturer base. The Council will serve a major role in helping AASA communicate to key audiences and develop communication strategies and action items.

Marketing Executives Council 5 August 13, 2009 Anti-Trust Guidelines It is the unqualified policy of the Automotive Aftermarket Suppliers Association to conduct its operations in strict compliance with the antitrust laws of the United States. AASA's antitrust policy prohibits any discussions which constitute or imply an agreement or understanding concerning: 1) prices, discounts, or terms or conditions of sale; 2) profits or profit margins or cost data; 3) market shares, sales territories or markets; 4) allocation of customers or territories; 5) selection, rejection or termination of customers or suppliers; 6) restricting the territory or markets in which a company may resell products; 7) restricting the customers to whom a company may sell; or 8) any matter which is inconsistent with the proposition that each manufacturer, wholesaler and distributor must exercise its independent business judgment in pricing its services or products, dealing with its customers and suppliers and choosing markets in which it will compete.

Marketing Executives Council 6 August 13, 2009 Council Business  2010 Dues Structure: Last MEC meeting, membership voted to maintain current dues structure to fund special projects going forward. Because of the way dues are invoiced and being a non-profit, we can not carry forward funds to the next year. Would everyone be OK with billing MEC a single invoice but broken down between dues and projects?

Marketing Executives Council 7 August 13, 2009 Auto Industry and Effect on the Aftermarket Room 705 across the hall ~~~ MEC will reconvene in this room at 10:00

Marketing Executives Council 8 August 13, 2009 Utilization of VIO Data Jeff Canty Marty Miller Experian

Activity and Trend Analysis and All Makes Application Data AASA Marketing Executives Council AAPEX 2009 Matt Krimple - Mitchell 1

Today’s Agenda Brief History of Mitchell 1 Value of Information Information Types and Purpose Information for Forecasting Application Data

Brief History of Mitchell 1 Industry Leader for over 85 Years –Service and Repair information –OE Parts and Labor Estimating information Shop Management Systems –Largest installed based in the independent repair market –E-Commerce with all major parts distributors

Brief History of Mitchell 1 Business Performance Solutions –Customer Retention Marketing –Service Intelligence –Performance Reporting Business Intelligence –Comprehensive Industry Data and Trends

Value of Information Answers through Analysis Vehicles Shops Part Stores Vehicles Parts Replacement Location

Types of Information Vehicles In Operation (VIO) Parts Store/Warehouse Data Syndicated Data Transactional Shop Data

Vehicles In Operation Compilation of title and registration data –Gathered from state/province Department of Motor Vehicles Proper product linkage to VIO –Market view of vehicles and associated parts within a trade area

Store/Warehouse Data Supply chain intelligence solutions based on large scale data warehouse practices –Product Planning –Inventory Optimization –Category Management –Brand Marketing Programs Involving multiple levels of the channel

Syndicated Data Understanding light application and hard parts categories to help build better plans –Key metrics and tools such as: Who, Where, How, What, What Else and Why your customers make the purchases they make for both the DIY and DIFM customer Consumer panel where their vehicle maintenance habits have been profiled Identified research can easily and cost effectively developed to gather more category specific insights that help further explain their purchasing behavior

Transactional Shop Data Where When Vehicle Mileage LaborParts

Transactional Shop Data Industry Averages and Trends

Transactional Shop Data Parts Installed –Part Type –Vendor –Gross Margin –Year, Make, Model –Mileage Replacement rates/frequency –Region, State, Zip

Information for Forecasting Analyze Data from Various Sources –Vehicles –Part Stores/Warehouses –Shops Combination of Individual Sources –Provides unique ability to answer specific questions

Information for Forecasting Answer Specific Questions –Inventory Compared with Vehicle Population –Inventory Compared with Replacement Rates or Services Performed –Inventory Pricing and Margins

Application Data Collaboration of Mitchell 1 & AASA –All Makes Application Data OE Parts Database includes –OE Part Number –Part Description –Part List Price –Domestic and Import Coverage –Available in 2010 More information to follow

Special Thanks To Activant Solutions Experian IMR Inc.

Marketing Executives Council 25 August 13, 2009 AAPEX IPR Update Sarah Bruno Arent Fox

Marketing Executives Council 26 August 13, 2009 Market Pulse  Survey Results: Survey went out 10/7/09 Original deadline extended to 10/23/09 Sent to executives list, approx Q3 participants vs. 30 in Q2 Aggregate results furnished to MEC – Detailed results by company size and product category available to participants only

Marketing Executives Council 27 August 13, 2009 Market Pulse  Survey Improvements: Eliminated 2 and added 2 questions – Order fill by line items – Drop shipments / cross docking Provided definitions for each question Created “floater” questions – Handling fees on returns – VIO data usage Included list / link to questions Clearer instructions on obtaining results

Marketing Executives Council 28 August 13, 2009 Market Pulse  Suggested Changes: Ways to improve survey – Number of questions – Type of questions Ways to improve participation – Annual or bi-annual instead of quarterly – Other???

AASA Market Pulse Q3, 2009 AASA Marketing Executives Council

AASA Market Pulse

Under $100 Million. $100 to $250 Million $250 Million to $1 Billion Over $1 Billion Did not answer 100%25.6%20.5%15.4%33.3%5.1% Chemicals7.7%5.1%2.6% Tools and Equipment12.8%2.6%10.3% General Service Parts25.6%7.7% 2.6%7.7% Cooling/AC Temp.25.6%7.7% 2.6% Under Car41.0%10.3%5.1%20.5%2.6% Under Hood48.7%7.7%10.3%12.8% 5.1%

AASA Market Pulse Average warranty returns % of net sales. 2.3% Average obsolescence returns % of net sales. 1.9% Average discrepancy returns % of net sales. 0.5% Average of all other returns % of net sales. 1.2% Sum of return categories 5.9%

AASA Market Pulse Q3-09Q2-09 Average warranty returns 2.3%3.3% Average obsolescence returns1.9%2.0% Average discrepancy returns0.5%1.2% Average of all other returns1.2%1.9% Sum of return categories5.9%8.3% Weighted percent change on last Jobber net price sheet2.7%3.3% General selling and sales administration expenses16.5%15.3% Order fill rate by unit volume94.1%93.9% Order fill rate by dollar value94.3%95.1% Order fill rate by line items filled92.9% * Order turnaround time (days) Days sales outstanding Business was done with overnight shipping4.7%2.9% Business requiring drop shipments/cross docking11.8%* * - New in Q3

AASA Market Pulse

The full report is only available to participants, it contains primary data broken out by: Company size & Product category

Marketing Executives Council 42 August 13, 2009 Supplier Image Task Force  NASCAR Public Service Announcement Will continue to air on ABC, ESPN and SPEED throughout November Available via DVD upon request  Web page “live” by going to Contains messaging and downloadable versions of all materials Links to news articles and member list

Marketing Executives Council 43 August 13, 2009 Supplier Image Task Force

Marketing Executives Council 44 August 13, 2009 Supplier Image Task Force  Media and Press Coverage – to date Electronic: – AMN News – multiple times – Greensheet – multiple times – Aftermarket Business – search-autoparts Print: – Tomorrow’s Technician – AAPEX Express – Counterman – November – Babcox Tech Group - November

Marketing Executives Council 45 August 13, 2009 Supplier Image Task Force  Next Steps Expand web page – Links to member pages – Links to reference materials Special Reports: Update and re-release – Direct Importing – Distributor Liabilities Know Your Parts POS – Counter flyer, Posters, etc. – Other

Marketing Executives Council 46 August 13, 2009 Wrap-up and Adjourn Next Meeting: March 18 In conjunction with Vision Intercontinental Hotel Chicago, IL 10:00 – 4:00

Marketing Executives Council 47 August 13, 2009 Thank You! Travel Safe!