SIMPLISITY: THE NEW VALUE PROPOSITION

1. SIMPLISITY: THE NEW VALUE PROPOSITION

2. “Costco's motivated employees also sell more: $795 of sales per square foot, vs. only $516 at Sam's and $411 at BJ's Wholesale Club Inc. (BJ ), its other primary club rival.” Business Week, APRIL 12, 2004 RETAIL: COSTCO VS. SAM’S CLUB “The other problem was that Sam's didn't cater to thehigher class of people that Costco did. Now, Jim has done apretty damned remarkable job. He puts a great emphasis on qualityand has moved into the food business and other new lines. We [thePrices] were very good at creating, but Jim was very good atdeveloping.“ http://www.teamster.org/04news/hn_040211_6.htm “A sure way to attract and keep customers is by selling goods on the cheap that they didn't expect to see. That's why racks of fine wine have been installed, as well as books ranging from best-selling novels to fairy tales. Those are in addition to Sam's ace: amassing and selling, at bargain prices, items people need most.” http://www.usatoday.com/money/industries/retail/2003-06-19-warehouseclubs_x.htm “Costco is used to making high-end goods available to its shoppers, most with annual household incomes topping $75,000. Items such as Mont Blanc's platinum Generations pen go for $98.99. Then, there's the Omega Constellation women's watch for $2,199.99.” http://www.usatoday.com/money/industries/retail/2003-06-19-warehouseclubs_x.htm

3. FINANCIAL SERVICES: ING DIRECT VS. BANK ONE

4. “ING Direct's products are straightforward: mortgages and home-equity loans, a half-dozen mutual funds, and CDs and savings accounts that pay some of the highest rates available. There are no fees or minimums. Customers can manage their accounts online, by phone, or by mail. In just two-and-a-half years, ING Direct has attracted more than a million customers and $10 billion in assets, shifting from startup mode to being one of the 50 biggest banks in the country. New assets are streaming in at a rate of close to $500 million a month. ING Direct, based in Wilmington, Delaware (but a division of the Amsterdam-based ING Group), had expected to lose $37 million in 2002. Instead, it turned a profit of $40 million.” FAST COMPANY, March 2003, Page 110 By: Scott Kirsner,http://www.fastcompany.com/magazine/68/ing.html FINANCIAL SERVICES: ING DIRECT VS. BANK ONE

5. “As Vancouver is well known for its sushi, this place is one of my faves.It has an all you can eat sushi variety, as well as all the teriyaki and they even have meat that you can bbq in the center of your table, on a little sunken bbq.Usually very busy, as it is very popular.Reasonably priced,and friendly serving staff.Also of mention, is the second floor viewing of the hustle and bustle of the streets down below, for those of you who like to people watch.” Source: http://www.virtualtourist.com/vt/dc80f/2/-3/ RESTAURANTS: SHABUSEN VS. YOUR LOCAL BUFFET • Reviews:"The best Japanese All-You-Can-Eat anywhere! “ • "I eat at Shabusen on a weekly basis and don't mind the half hour drive to eat their sushi. All-you-can-eat menu is available, with bbq at each table or hot pot. Prices are reasonable and service is very fast and friendly. Newly renovated with pleasant decor. They are very busy on Friday and Saturday nights, reservations are recommended. I highly recommend this restaurant! A+ “ • - Theresa O (sushiimonster@yahoo.com) (April 15th 2003, http://www.sushi.infogate.de/rest/na_canada_vancouver.htm

6. Member rating:Just bought the X for my wife. Set up our first wireless network and everything went well. The widescreen is fabulous to look at and the notebook very easy to use. […] We got the 1.3 and seems to be as fast as my p4 2.5 desktop. For most people the WXGA screen will be good enough, max res of 1280. […] Anyway first notebook and really loving it. Member rating:This computer truly represents a new age in mobile computing. It is incredibly fast, on battery power it lasts twice as long as any other computer I have owned, the screen in bright and accurate, as a multimedia / entertainment computer few will top it, and for all it offers, it is remarkably thin and light. Go to a store that has an X1000 and other notebooks on display. Notice how the crowd gathers around the Compaq. There is good reason for that.http://www.pcmag.com/article2/0,1759,1202339,00.asp COMPUTERS: COMPAQ X1000 VS. OTHER LAPTOPS

7. WINNER PRODUCTS HAVE A LOT IN COMMON • Straightforward, simple product offering. • High-end, sophisticated, quality product. • Limited choice. • Winner product features: the product includes many traditionally optional features. • Attractive pricing allows achieving high sales. • Low overhead: the product itself produces buzz. High-End, Sophisticated Product Limited Choice Simple, straight-forward offering

8. OTHER THINGS TO THINK ABOUT • What industries this simple value proposition could work in and why. • Role of economies of scale. • Existence of “winner configuration”. • Simplicity should provide value for consumer and cut cost for marketer. • How to invent simple products. • What else?

9. APPENDIX

10. ING DIRECT PRODUCTS

11. A BETTER SAVING ACCOUNT • ING DirectING DIRECT offers an alternative to traditional banking that provides a better value to customers. ING DIRECT (the operating name of ING Bank, fsb) does business online, over the phone or by mail, and that keeps costs low. Without the overhead and high operational cost of other banks, rates on the Orange Savings Account and Orange CD accounts are higher and rates on home loans lower. The savings and CD accounts allow you to earn the highest rates in the nation with no fees and no minimums. The Orange Mortgage is an adjustable rate mortgage with no application fee, no points, and great rates that can save you thousands. ING DIRECT is banking made simple to help you Save your money! • Source: http://www.ing-usa.com/us/prod_serv/banking/ing_direct.html