IBM and DemandTec Team to Deliver Consumer Demand Management Service

First Customer Is Leading European Retailer

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ARMONK, NY & SAN CARLOS, CA - 23 Mar 2004: B&Q plc, Europe's leading do-it-yourself home improvement retailer, plans to use a new Web-based service from IBM and DemandTec, Inc., to more effectively manage its product pricing strategy, IBM and DemandTec announced today.

Called IBM Consumer Demand Management Service with DemandTec, the service can help B&Q quickly understand how customers react to price changes to best manage its investment in low prices. The new service is hosted and managed by IBM, and is the first on demand solution for the retail and consumer products industries. IBM and DemandTec have signed an agreement to deliver the service to customers worldwide.

"Access to the highest quality technology on demand helps us compete in an increasingly dynamic and competitive market place," said Howard Langer, B&Q plc. "The service we will receive from IBM and DemandTec will allow us to more effectively carry out our pricing strategy of delivering lower prices to our customers."

DemandTec software provides retailers with data at every point of the merchandising lifecycle, from understanding how customers initially react to prices and promotions, to predicting the impact of price changes on sales and profit, to executing strategies that consistently deliver the right prices and promotions, to responding to market indicators, and finally to measuring the impact of price and promotion decisions. DemandTec was selected as a key partner to deliver its application for managing critical price and promotion activities using IBM's e-business hosting and application management services.

"DemandTec helps retailers and manufacturers of every size unlock the business potential of customer demand for the purpose of making merchandising decisions," said Dan Fishback, DemandTec's CEO. "This alliance with IBM allows DemandTec to better serve our customers with proven, scalable, turn-key Consumer Demand Management solutions. Our joint service represents the next stage in merchandising technology, in which software and services are delivered 'on demand' anywhere in the world."

IBM Consumer Demand Management Service with DemandTec is based on a scaleable computing architecture, allowing customers anywhere to quickly increase or decrease usage. Customers pay for the hosting service based on the number of stores, number of store keeping units (SKUs) and total amount of data processed.

"B&Q is in the forefront with this new on demand service from IBM and DemandTec," said Jim Corgel, general manager, IBM e-business Hosting Services. "Today's announcement reinforces our commitment to providing retailers and consumer products companies around the world with services and technology to help them differentiate their businesses, maximize revenue and improve market share."

The Consumer Demand Management offering is the newest on demand service from IBM Global Services. On demand services from IBM help businesses and organizations create open infrastructures that allow information to flow across independent business operations, such as those for managing customer relationships or the supply chain. This type of integration can help a company become an on demand e-business -- capable of responding quickly, intelligently and flexibly to customer demands and changing market conditions.

The IBM Consumer Demand Management Service with DemandTec uses IBM WebSphere, DB2 and Tivoli Security Management software on IBM eServer pSeries systems in a hosted environment to provide around-the-clock infrastructure support for the requirements of both large and small retailers and consumer products companies. Customers subscribing to the service will receive all required installation, operations, systems administration, maintenance and support, as well as robust security, supplier registration and document management. A host of secure connectivity options and integration services for legacy systems are also available.

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