InfoGroup Consolidates Brand Identity, Restructures CEO Contract

Infogroup, formerly InfoUSA, is changing its branding structure. Under the new policy, the Infogroup name will be at the forefront, Brands the company has acquired, such as Yesmail, Opinion Research Corp. and a variety of list management and brokerage firms, will be subsumed.

“Historically we have been a loose confederation of business units,” Bill Fairfield, Infogroup’s CEO, told Direct Newsline. “Our customers want to reduce the number of vendors they are dealing with. We might have five or six business units working with the same customers, and that customer might not have an idea that these companies were part of Infogroup. They didn’t realize the full breadth and depth of what we were bringing to the table.”

The consolidation would bring the company’s 31 brands under 10 business unit headings. Infogroup had previously announced its plans to merge May Development Services and Triplex into Infogroup/Nonprofit. Other brands, such as Salesgenie, Yesmail and Opinion Research Corporation will retain their identities, albeit more prominently identified as Infogroup properties.

Fairfield freely admits cost savings are part of the current effort, and these will include combining sales organizations and back office functions. “It does tend to include headcount,” he said. “But those in customer-facing positions, those who drive revenue, not only are we maintaining, we are increasing.”

The company will also be changing how it allocates marketing spending – although that did not necessarily mean reducing spending.

“As we look at 2010, we are going to increase [marketing spending] from 2009,” Fairfield said. Previously, “We might have multiple business units sending list catalogs to the same customers. We have numerous business units competing for the same search terms. We are going to take a much more rational approach to how we do search engine optimization and search engine marketing.

“We will increase our absolute spend next year, but we’ll be much more focused and efficient,” Fairfield added.

Might the consolidation, especially in the brand-conscious list brokerage and management areas, result in loss of list management clients? “We are not anticipating any loss,” Fairfield said. “We have done a lot of client interviews, and our research shows this will strengthen our hand. Customers want suppliers with strong financials, and breadth of marketing capabilities and new products.

What else will 2010 bring? A renewed focus on organic growth, as opposed to the growth-through-acquisition strategy it had pursued in recent years. “That doesn’t mean we won’t do acquisitions,” Fairfield said, adding that Infogroup would take advantage if the right opportunity presented itself.

There will also be “dramatic changes in how marketing dollars get spent,” Fairfield said, adding that he saw a “secular change from traditional direct marketing and more emphasis on digital.”

That might not be the only changes for the company in 2010. In December 2008, the company retained Evercore Partners to help it explore a variety of activities, including acquisitions, divestments and a potential sale of the firm. “I don’t think anything is off the table,” Fairfield said, when asked about the advisor group’s current thinking. “But you shouldn’t read into that any initiative.”

The looming question is whether founder and former CEO Vinod C. Gupta would be party to any acquisition effort. Asked about this, Fairfield replied “[Gupta] is a large shareholder and a member of the board of directors. He has not made any noise about re-acquiring the company.”

The Observer’s Take: Fairfield spoke to Direct Newsline before InfoGroup filed an amended employment agreement with the Securities and Exchange Commission. Under the terms of the new agreement, Fairfield’s employment is now on an automatically renewing quarter-by-quarter basis, with both parties able to terminate it. This could mean either that the board is more closely yoking his job with quarterly performance – or it could give a potential suitor for the company an inexpensive way of dismissing him should the firm be sold.