Prospectus Summary
This summary highlights information contained elsewhere in this prospectus. This summary does not contain all the information you should consider before buying our common stock. You should read the following summary together with the more detailed information appearing in this prospectus, including our consolidated financial statements and related notes. You should carefully consider, among other things, the matters discussed in “Risk Factors.”
DEMANDTEC, INC.
We are the leading provider of consumer demand management, or CDM, software. Our software enables retailers and consumer products, or CP, companies to define merchandising and marketing strategies based on a scientific understanding of consumer behavior and makes actionable pricing, promotion and other merchandising and marketing recommendations to achieve revenue, profitability and sales volume objectives. We deliver our applications by means of a software-as-a-service, or SaaS, model, which allows us to capture and analyze the most recent retailer and market-level data and rapidly enhance our software to address our customers’ ever-changing merchandising and marketing needs.
Our CDM software is comprised of a suite of integrated applications — DemandTec Price, DemandTec Promotion, DemandTec Markdown and DemandTec TradePoint. DemandTec Price combines price optimization functionality with price management features to enable retailers and CP companies to create multiple pricing scenarios, evaluate tradeoffs and optimize everyday prices. DemandTec Promotion enables retailers and CP companies to create and simulate multiple promotional plans based on mathematical forecasts. DemandTec Markdown enables retailers to optimize plans and prices for items they intend to remove from their assortments, such as end-of-season items, discontinued product lines or overstocked merchandise. DemandTec TradePoint provides retailers and their CP trading partners with a platform to automate and streamline the presentation, negotiation and reconciliation of trade promotion offers in a secure, web-based environment.
Our software as a service is used by over 135 customers worldwide, including Advance Auto Parts, Best Buy, Casino, Circle K Stores, General Mills Sales, Kraft Foods Global, Monoprix, Office Depot, Procter & Gamble, Safeway and Wal-Mart.
The retail and CP markets are large, global markets. In 2005, retail trade represented approximately 23% of worldwide gross domestic product. There are more than 1,500 retailers worldwide that have annual sales in excess of $500 million, and there are thousands of CP companies that sell to these retailers. In 2004, the CP industry generated revenue in the United States of more than $2 trillion. Retailers and CP companies operate in intensely competitive environments in which consumers are becoming more discerning and less loyal. The growth of discount stores, warehouse clubs and dollar stores and the emergence of the Internet as a viable retail alternative have provided consumers with increasing alternatives when purchasing goods. In addition, consumers are becoming more knowledgeable and, in many instances, more price sensitive. In order to gain sustainable advantage in the competition for share of consumer wallet, retailers and CP companies must better understand and predict consumer behavior across geographic, demographic and other segments. Without a scalable solution to incorporate statistical analytics, however, retailers and CP companies historically have made merchandising decisions based on simpler approaches such as cost-plus or competitor-matching pricing and “one-size-fits-all” assortments.
Our CDM software enables customers to incorporate a scientific understanding of consumer demand into their merchandising and marketing decision-making processes. Key benefits of our CDM software include:
End box 1 END LOGICAL PAGE PAGEBREAK BEGIN LOGICAL PAGE Begin box 1Our objective is to extend our position as the leading provider of CDM software. Key elements of our strategy to achieve this objective include:
Risk Factors
Our business is subject to numerous risks, which are highlighted in the section entitled “Risk Factors” immediately following this prospectus summary. Some of these risks are:
For further discussion of these and other risks you should consider before making an investment in our common stock, see the section entitled “Risk Factors” immediately following this prospectus summary.
Corporate Information
We were incorporated in Delaware in November 1999. Our principal executive offices are located at One Circle Star Way, Suite 200, San Carlos, California 94070. In November 2006, we acquired TradePoint Solutions, Inc., or TradePoint. Our telephone number is (650) 226-4600. Our website address is www.demandtec.com. Information contained on our website is not incorporated by reference into this prospectus, and you should not consider information contained on our website to be part of this prospectus or in deciding whether to purchase shares of our common stock. Our fiscal year ends on the last day of February. References to fiscal 2007, for example, refer to our fiscal year ended February 28, 2007.
End box 1 END LOGICAL PAGE PAGEBREAK BEGIN LOGICAL PAGE Begin box 1Unless the context otherwise requires, we use the terms “DemandTec,” “we,” “us” and “our” in this prospectus to refer to DemandTec, Inc. and its subsidiaries on a consolidated basis. “DemandTec” and the DemandTec logo are registered trademarks of DemandTec. Other DemandTec trademarks used in this prospectus include “DemandTec Price,” “DemandTec Promotion,” “DemandTec Markdown,” “DemandTec TradePoint” and “MyDemandTec.” This prospectus contains additional trade names and trademarks of ours and of other companies.
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