When a Presentation is Not a Presentation Example Slides

1. When a Presentation is Not a PresentationExample Slides August 4, 2012

2. This set of slides is supporting material for a Woodlawn Associates blog post, When a Presentation is Not a Presentation. They are not meant to stand on their own.

3. Most successful slides in business presentations have three main elements 1 Title giving main takeaway of slide 3 Text giving key assumptions, providing additional evidence, or explaining the logic behind the conclusion 2 Chart, table, or graphic providing quantitative data, analysis, or organizing framework

4. Dealers said they expect to increase use of canvassing and online in 2012, but use less radio Example slide: graph and qualitative supporting data • Data represents dealers’ view before this survey; several have mentioned intention to change strategies after seeing preliminary report • Several dealers mentioned intention to increase use of door-to-door canvassing… • “We are going to start doing door-to-door in neighborhoods where we have installs.” Dealer G • “We will definitely do more canvassing – that seems to be our horse of choice. “ Dealer J • …though some are going the other direction • “We will also probably do less canvassing…The problem is if you are working down the right side of a street, there is another firm working the left side, and you will meet a third firm along the way. Good neighborhoods are saturated and we are wearing out our welcome.” Dealer C • Dealers also expect to more heavily weight online advertising • “This year we are going to work more web sites locally, like the site of the local newspaper.” Dealer A • “Online will be a bigger share this year. We have a new web site and, with our new message, we think it will resonate.” Dealer C • “We’ll spend more money this year on SEO and enhancing the website…We are convinced that spending on the website will give a better return than hiring another salesperson…” Dealer G • Overall, dealers plan to do less radio • “We will do less radio. We just don’t have enough ammo.” Dealer C • “We will decrease radio, although I am thinking about underwriting the local public radio station.” Dealer A Source: Woodlawn Associates; n=13

5. Financing for emerging turbines more costly and shifts more risk to sponsor Example slide: qualitative only • Deals likely to be priced 25-100 basis points higher • “There might be a slight premium on spread – something like 25-50 basis points.” – Equity Investor B • “It would be maybe 50-75 basis points more.” – Debt Investor G • “I would be willing to look at this for additional return or lower risk. For example 70-100 basis points on the return side.” – Debt Investor B • Investors may require recourse to the sponsor or other guarantees… • “What will happen on a deal with Clipper or Suzlon is there will need to be some recourse back to the sponsor…We will not finance a Suzlon-only farm with no- or low-recourse loans. No way.” – Debt Investor A • “Maybe it is not additional spread, but I could have 25% of my investment guaranteed by the sponsor.” – Debt Investor B • “To do a deal, it wouldn’t be sufficient to get a higher rate or some risk mitigation. You’d need both. Some incremental spread plus some recourse or really solid report from an engineering firm or a corporate guarantee.” – Debt Investor E • “Ideally, lenders would love to be able to go to the project sponsor to back up any warranty the vendor can’t support.” – Debt Investor C • …and will likely want more of the sponsor’s money in the deal • “If a normal project had a debt service coverage of 1.45, you might require 1.55 for Clipper.” – Debt Investor C • “When we finance projects like that we make appropriate adjustments to expected O&M and availability. Thus, there will be reduced cash flows. This will reduce the amount we’re willing to put into a deal relative to some others.” – Equity Investor B • “There’s a good chance the amount of leverage would go down.” – Debt Investor G • Burden of proof for emerging turbine deals will be higher • “We would have a special concern about the reliability with Suzlon. They would have to establish to our satisfaction that the problems weren’t going to occur again.” – Debt Investor F Source: Woodlawn Associates interviews

6. Optimizing value of customer base requires models of customer lifetime value, churn, and elasticity Example slide: qualitative with clarifying graphics Actions to Improve Overall Lifetime Value of Customer Base Model Customer Lifetime Value Model Churn ModelElasticity Questions Answered • Segments and customers with highest expected lifetime value • Segments and customers most & least likely to churn • Churn pattern over time • Inducements most effective in keeping customers loyal or getting them to buy more • Innate, purchase history, and customer experience predictors* • Acquisition cost • ARPU and cost to serve • Decreasing cost over time (i.e. less use of customer support, etc.) • Value of referrals • Bundled product purchases • Expected churn • Innate, purchase history, and customer experience predictors* • Pattern over time • Innate, purchase history, and customer experience predictors* • Pricing • Promotions • Network upgrades • Controlled tests of hypotheses Key Issues • Strategic questions answered: • How do I design my product and offer to appeal to the segments with the highest lifetime values? • How do I best retain customers with high lifetime value? • How do I most efficiently encourage them to buy more? • Where should I invest in network upgrades to maximize return? Notes: * See examples on next page

7. For producers, optimal channel design balances five goals: Example slide: list • Minimize total cost of distribution throughout the channel • Maximize producer market share, revenue, and profit • Optimize return on distribution-specific assets • Meet customer needs • Product information, customization or modification, availability, after sale service, credit, etc. • Maintain sources of market information