In her new role Ms. Lee will be supporting JZM (healthcare focused marketing research firm), recently acquired by Phoenix to be the cornerstone of Phoenix Healthcare and will also be focusing her energies on the marketing and selling of healthcare products and services to the pharmaceutical and biotech industry.

"We are very delighted to have Kathy join Phoenix Healthcare. She is one of the top healthcare Business Developers in the industry and her vast experience and exuberance will be a tremendous asset for our organization", stated Allen R. DeCotiis, Ph.D., Chairman & CEO of Phoenix Marketing International.

"We are excited about Kathy joining JZM. We are looking forward to her leadership and ability to connect JZM's known and new capabilities with pharmaceutical industry's growing need for research that delivers more value for the dollar", said Doug Zabor, President of JZM.

Commenting on her new position, Kathy said, "I am thrilled and excited about joining Phoenix Marketing International and their Healthcare Division. This is a company that has achieved phenomenal growth during the past four years with it now being one of the leading research companies in the United States. I am pleased to be part of their healthcare family and looking forward to contributing to their growth."

About Phoenix Marketing International
Founded in 1999, Phoenix Marketing International is one of the fastest growing marketing services firms in the United States (with 2006 pro-forma revenue of $27,000,000) and partner to many of the largest companies in the financial services, consumer package goods, automotive, and travel and leisure industries worldwide. Phoenix also offers advanced advertising and brand measurement along with direct marketing expertise. Phoenix has offices in Rhinebeck (NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. On January 12th Phoenix acquired a major interest in JZM, a full service healthcare market research company, to serve as the foundation of its new healthcare practice.

Phoenix offers a unique combination of industry expertise, methods and consulting services, combining primary and syndicated marketing research expertise with database analytics and modeling proficiency. Applying this information assists clients in improving profit dynamics of their business.

(Rhinebeck, NY, February 2, 2006) – The latest data from Phoenix Marketing International’s Affluent Marketing Service (AMS) reveals that the number of millionaire households in the U.S. now stands at 5.4 million, soaring 56% since 2003. The Phoenix study defines a “millionaire” household as one having at least $1 million in liquid or “investable” assets.

“The extraordinary gains in the millionaire households population in the past three years is a function of their asset allocations and access to products that can maximize market gains” states David M. Thompson, Managing Director of the Affluent Practice at Phoenix Marketing International. Indeed, their growth in numbers has eclipsed that of the S&P 500, which gained nearly 30% from mid-year 2003 to mid-year 2006.

The Phoenix data also points to strong growth in even wealthier households. The number of Penta-Millionaire households, those having at last $5 million or more in liquid wealth, has grown to 755,000 nationally, an increase of 47% since 2003.

About The Phoenix Affluent Marketing Service (AMS) Program
The Phoenix Affluent Marketing Service (AMS) program, the largest syndicated study of the affluent market, is a continuously fielded survey of affluent and high net worth households throughout the U.S. The AMS provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com.

About Phoenix Marketing International
Founded in 1999, Phoenix Marketing International is one of the fastest growing marketing services firms and partner to many of the largest companies in the financial services, consumer package goods, automotive, travel and leisure, and pharmaceutical industries worldwide. Phoenix also offers advanced advertising and brand measurement along with direct marketing expertise. Phoenix has offices in Rhinebeck (NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa, Miami, and Durham, North Carolina. Phoenix offers a unique combination of industry expertise, methods and consulting services, combining primary and syndicated marketing research expertise with database analytics and modeling proficiency. Applying this information assists clients in improving profit dynamics of their business.

Every other month, the Phoenix Marketing International Affluent Marketing Service™ (AMS) tracks changes that affluent and high net worth households anticipate making to their investment portfolios in the next three months. This article examines the investment sentiment of Mass Affluent investors and the financial services distribution channels that will most likely receive additional assets from these investors.

Overall, millionaire households have become more bullish over the past 6 months compared with their Mass Affluent counterparts.

Mass Affluent Market ($250k - $999k Investable Assets)

In the December, 2006, AMS tracking period, in the Mass Affluent market, investment sentiment continued a "see-saw" pattern which started in June of 2006.

In December, 40% of Mass Affluent households stated they were likely to make net increases to their portfolios in the next three months, up four percentage points from October. Buying sentiment has see-sawed between 43% and 36% since mid-year 2006, suggesting that many affluent investors are unsure as to the staying power of the current bull market.

In the next 3 months, which of the following changes are you and your household likely to make regarding your overall financial investments? Mass Affluent Market

The "Investment Sentiment Trend Line", depicted in the charts below, shows the percentage of Mass Affluent consumers that anticipate making increases to various asset class categories, including stocks, mutual funds, fixed income, real estate, business investments, deposit accounts, alternative investments, and retirement accounts. (The base is those 40% who say they planned to make net increases to their portfolios.)

• Among the 40% likely to increase investments: there were few large directional shifts in buying propensities for various asset classes:
  • Stocks: 38% likely to increase positions; unchanged from October
  • Mutual Funds: 48% likely; down from 53% in October
  • Fixed Income: 18% likely; down slightly from October
  • Alternative Investments: 7% likely; unchanged
  • Retirement Accounts: 66% likely; down slightly from October
  • Deposit Accounts: 60% likely, up 6 percentage points from October
  • Real Estate: 17% likely; down slightly from October
  • Business Investments: 8% likely, continuing a 3-period decline

Investment Sentiment: Percent Likely To Increase Holdings In Next 3 Months Tracking Periods: October 2005 - December 2006 Mass Affluent Households (click image to enlarge)

Base: plan to make net increases or decreases to overall investments in the next 3 months

Channels Likely To Receive New Assets In Next 3 Months - Mass Affluent
Deposit Accounts, Stocks, Mutual Funds, Retirement Accounts, Fixed Income Accounts

Trends worth watching:

• Full Service Brokers: increased interest in adding to stock positions
• Mutual Fund Companies: increased interest in adding to stock positions
• Online/Discount Brokers: increased interest in adding to stock positions
• Banks: decreased interest in deposit accounts
• Private Banks: increased interest adding to stock positions

$1 Million+ Investable Assets

In December, 2006, the investment sentiment of millionaire investors continued a 3-period improvement.

48% of millionaire households felt that they would make net increases in investments in the next 3 months, up from 41% in October and 39% in August. 45% were neutral, while 7% felt that they would make net decreases.

$1 million+ Investment Sentiment Trend Lines includes:

• Among the 48% of millionaire investors likely to increase investments: sentiment towards most asset classes was little changed from October. Exceptions: real estate, down 4 points; business investments, down 6 points.
  • Stocks: 53% likely to increase positions, little changed from October
  • Mutual Funds: 53% likely; little changed
  • Fixed Income: 28% likely; little changed
  • Deposit Accounts: 57% likely, down from 61% in October
  • Alternative Investments: 15% likely; down from 18% in October
  • Retirement Accounts: 59% likely; little changed
  • Business Investments: 13% likely; down from 19% in October
  • Real Estate: 23% likely; down from 27% in October

Investment Sentiment: Percent Likely To Increase Holdings In Next 3 Months Tracking Periods: August 2005 - October 2006 $1 Million+ Investable Assets (click image to enlarge)

Base: plan to make net increases or decreases to overall investments in the next 3 months

Channels Likely To Receive New Assets In Next 3 Months - $1 MM+ Investable
Deposit Accounts, Stocks, Mutual Funds, Retirement Accounts, Fixed Income Accounts

Trends worth watching:

• Online/Discount brokers: decreased interest in adding to deposit account and stock positions at these firms
• Independents: increased interest in adding to their mutual fund positions
• Full Service Brokers: increased interest in adding to retirement account positions

About The Phoenix Affluent Marketing Service (AMS) Program
The Phoenix Affluent Marketing Service (AMS) program is a continuously fielded survey of affluent and high net worth households throughout the U.S., and provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes. Each questionnaire, fielded bi-monthly, contains a minimum of 1,100 completed questionnaires among qualified affluent households.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com. Or visit the Phoenix Marketing International web site at www.phoenixmi.com.

About Phoenix Marketing International
Phoenix Marketing International was founded in 1999 by Allen DeCotiis, Ph.D. and Martha Rea, MA. Phoenix is a privately held company. Phoenix has offices in Rhinebeck,(NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. Phoenix was founded to integrate industry expertise, research, direct marketing, modeling, and multicultural expertise to help clients address their marketing needs. Through a combination of industry experience, research, marketing, analytic modeling and multicultural expertise, Phoenix partners with its clients to solve complex business issues and achieve a significant return on marketing investment.

(Rhinebeck, NY) January 18, 2007 - Phoenix Marketing International today announced the acquisition of JZM, Inc. (Johnston, Zabor, McManus), a full service marketing research firm based in Durham, North Carolina, that specializes in healthcare research. The company provides research for 7 of the 10 largest global pharmaceutical companies as well as many small and mid-size pharmaceutical and biopharmaceutical companies. JZM provides research and research systems that support products from concept through launch and market growth. In addition, JZM offers the country's largest normative database used to measure customer experience at pharmaceutical websites.

JZM takes a holistic approach that determines the influence that providers, payers and patients have on each other and on market performance. JZM then works with companies to efficiently and effectively grow the value that their products deliver at each point of this decision triangle of influence.

"We are delighted to have Doug Zabor, Peter McManus and the JZM team join Phoenix Marketing International. Not only will this complete Phoenix's strategic coverage of major industry sectors, but Phoenix brings many advanced analytic services to JZM's impressive client list. In addition, Phoenix is already far along in the process of working with JZM to bring additional healthcare researchers to the company and plans to make other announcements shortly", stated Allen R. DeCotiis, Ph.D., Chairman & CEO of Phoenix Marketing International.

"At JZM, we are excited about joining Phoenix Marketing International. JZM will now be better able to fulfill our vision to help our pharmaceutical and healthcare customers deliver greater value to their customers. The world of pharmaceutical marketing is undergoing fundamental changes that require greater expertise in non-personal marketing and managing customer experience. The expertise provided by Phoenix's multi-cultural research, advanced promotional and brand analytics, list optimization, and rapidly expanding global capabilities will help JZM better serve the full spectrum of healthcare clients," stated Doug Zabor, President of JZM.

About Phoenix Marketing International
Founded in 1999, Phoenix Marketing International is one of the fastest growing marketing services firms in the United States (with 2006 pro-forma revenue of $27,000,000) and partner to many of the largest companies in the financial services, consumer package goods, automotive, and travel and leisure industries worldwide. Phoenix also offers advanced advertising and brand measurement along with direct marketing expertise. Phoenix has offices in Rhinebeck (NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami.
Phoenix offers a unique combination of industry expertise, methods and consulting services, combining primary and syndicated marketing research expertise with database analytics and modeling proficiency. Applying this information assists clients in improving profit dynamics of their business

About JZM
JZM is a healthcare focused marketing research firm established in 1986. The company merges existing, proven marketing research techniques with new state-of-the-art technologies for faster and better results for our pharmaceutical, biotech, and other healthcare clients. The company's core business is focused in new product, communication, and customer satisfaction research as well as our proprietary suite of website satisfaction research products. The majority of our studies help support new product/service development, pricing, positioning, launching and tracking integrated with customer research.

JZM's philosophy is to provide value-added services through a combination of industry expertise, sophisticated research competencies, and technological innovations. As a member of the Council of American Survey Research Organizations, JZM is committed to adhering to CASRO's high level of standards and code of ethics for marketing research organizations. JZM is located in Research Triangle Park, N.C.

Contact
Allen R. DeCotiis, Ph.D.
Phone: 845-876-1951
E-mail: Al.DeCotiis@phoenixmi.com

According to the Phoenix AMS program, one third of millionaire households (Wealth Market: households with $1 million+ investable assets) are fully retired as of the end of 2006. Of the non-retirees, 52% say that they will be likely to be fully retired within the next ten years.

Among Wealth Market households that have not yet retired, nearly one-quarter (24%) have not met with an advisor about their retirement planning needs. While this is lower than their less wealthy counterparts in the Emerging and Mass Affluent markets, it still represents a very large percentage of high net worth investors that have yet to get professional guidance regarding the complex issue of retirement planning.

There is a strong perception among many wealthy investors that they do not need professional guidance regarding retirement. For millionaire households that have never met with an advisor about their retirement planning needs, two-thirds (66%) felt that they do not need advice about this issue.

Despite their wealth and despite the assertion of many that they do not need retirement advice, only a minority of millionaire households are very confident about financial issues in retirement. Only slightly more than one-quarter (27%) of millionaire households who are not yet retired feel very confident about how much money they will need once retired. And less than one third (31%) are very confident with their knowledge of how to calculate their retirement income; or with being ready for retirement financially (31%).

High net worth households who have yet to meet with a professional advisor about retirement represents a large market, approximately 1.2 million households nationally (out of about 4.8 million Wealth Market households according to the Phoenix AMS study). Many high net worth households feel that they are adequately positioned for retirement given their level of wealth. While some may indeed be well positioned for retirement, it is likely that many are not. Given the complexities of retirement income planning, advisors and institutions that want to approach this market must first communicate the need for and importance of this issue to their skeptical prospects.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com.

As seen in Research Alert:
Business Travelers Turn To The Web To Research Trips, Make Reservations, And Keep In Touch - There are two types of business travelers, according to Forrester Research: “managed” travelers who have to use their companies’ preferred agents (about 40% of business travelers) and “unmanaged” travelers who can choose their own means (the remaining 60%). Managed travelers spend more than double the amount per trip ($1,511) as do unmanaged travelers ($708).

As seen in Sports Strategies (French Publication):
PMI A ÉTUDIÉ LA RÉCEPTIVITÉ DES JOUEURS AMÉRICAINS (French, bottom of page 3) - PMI (Phoenix Marketing International) a récemment publié une étude, réalisée auprès de plus de 1500 joueurs réguliers et portant sur les 70 jeux les plus en vue de l’année 2006 aux Etats-Unis, afin d’évaluer la réceptivité des joueurs à la publicité in-game. Il en ressort notamment que parmi les marques que les joueurs

Every other month, the Phoenix Marketing International Affluent Marketing Service™ (AMS) tracks changes that affluent and high net worth households anticipate making to their investment portfolios in the next three months. This article examines the investment sentiment of Mass Affluent investors and the financial services distribution channels that will most likely receive additional assets from these investors.

Overall, in October, Mass Affluent households were less bullish on the 3-month market outlook, but millionaire households became more bullish. Among the Mass Affluent and Millionaire investors likely to increase their investments in the short term, sentiment was up sharply for retirement accounts, alternative investments, real estate, stocks, and mutual funds.

Mass Affluent Market ($250k - $999k Investable Assets)

In the October, 2006, AMS tracking period, in the Mass Affluent market, investment sentiment turned more pessimistic again, suggesting a lot of confusion about the direction of the market.

In October, 36% of Mass Affluent households stated they were likely to make net increases to their portfolios in the next three months, down eight percentage points from August. 58% of these households indicated likelihood to make no changes, up from 52%, while 5% said they were likely to make net decreases to their portfolios.

The “Investment Sentiment Trend Line”, depicted in the charts below, shows the percentage of Mass Affluent consumers that anticipate making increases to various asset class categories, including stocks, mutual funds, fixed income, real estate, business investments, deposit accounts, alternative investments, and retirement accounts. (The base is those 44% who say they planned to make net increases to their portfolios.)

• Among the 36% likely to increase investments: propensities are up significantly for retirement accounts, mutual funds, stocks, real estate, and fixed income, while declining sharply for deposit accounts.
  • Stocks: 38% likely to increase positions; up significantly from August
  • Mutual Funds: 53% likely; up from 31% in August after a 3 period decline
  • Fixed Income: 20% likely; up from 9% in August
  • Alternative Investments: 7% likely; up from 3% in August
  • Retirement Accounts: 70% likely; up significantly from 48% in August
  • Deposit Accounts: 54% likely, down significantly from August
  • Real Estate: 19% likely; up from 13% in August
  • Business Investments: 10% likely, little change

Investment Sentiment: Percent Likely To Increase Holdings In Next 3 Months Tracking Periods: August 2005 – October 2006 Mass Affluent Households (click image to enlarge)

Base: plan to make net increases or decreases to overall investments in the next 3 months

Channels Likely To Receive New Assets In Next 3 Months – Mass Affluent
Deposit Accounts, Stocks, Mutual Funds, Retirement Accounts, Fixed Income Accounts

Trends worth watching:

• Mutual Fund Companies: increased interest in adding new assets to mutual funds offerings, decreased interest in adding to fixed income holdings
• Online/Discount Brokers: increased interest in adding to fixed income holdings at these firms
• Banks: decreased interest in fixed income investments at these firms.

$1 Million+ Investable Assets

In October, 2006, the investment sentiment of millionaire investors improved, reversing a 3-month decline.

41% of millionaire households felt that they would make net increases in investments in the next 3 months, up from a low of 39% in August. 52% were neutral, while 6% felt that they would make net decreases.

$1 million+ Investment Sentiment Trend Lines includes:

• Among the 41% of millionaire investors likely to increase investments: sentiment was up for all categories except fixed income. High net worth investors are increasingly bullish on alternative investments and real estate investments.
  • Stocks: 54% likely to increase positions, up from 48% in August
  • Mutual Funds: 51% likely; reversing a 3-month decline
  • Fixed Income: 26% likely; flat trend line
  • Deposit Accounts: 61% likely, up significantly from 52% in August
  • Alternative Investments: 18% likely; continuing a 3-month bullish trend
  • Retirement Accounts: 60% likely; up significantly from 50% in August
  • Business Investments: 19% likely; up from 14% in August
  • Real Estate: 27% likely; continuing a 3-month bullish trend

Investment Sentiment: Percent Likely To Increase Holdings In Next 3 Months Tracking Periods: August 2005 – October 2006 $1 Million+ Investable Assets (click image to enlarge)

Base: plan to make net increases or decreases to overall investments in the next 3 months

Channels Likely To Receive New Assets In Next 3 Months – $1 MM+ Investable
Deposit Accounts, Stocks, Mutual Funds, Retirement Accounts, Fixed Income Accounts

Trends worth watching:

• Mutual Fund Companies: increased interest in adding to mutual fund and retirement account holdings
• Online/Discount brokers: decreased interest in adding to mutual fund positions at these firms
• Independents: increased interest in adding to their fix income positions

About The Phoenix Affluent Marketing Service (AMS) Program
The Phoenix Affluent Marketing Service (AMS) program is a continuously fielded survey of affluent and high net worth households throughout the U.S., and provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes. Each questionnaire, fielded bi-monthly, contains a minimum of 1,100 completed questionnaires among qualified affluent households.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com. Or visit the Phoenix Marketing International web site at www.phoenixmi.com.

About Phoenix Marketing International
Phoenix Marketing International was founded in 1999 by Allen DeCotiis, Ph.D. and Martha Rea, MA. Phoenix is a privately held company. Phoenix has offices in Rhinebeck,(NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. Phoenix was founded to integrate industry expertise, research, direct marketing, modeling, and multicultural expertise to help clients address their marketing needs. Through a combination of industry experience, research, marketing, analytic modeling and multicultural expertise, Phoenix partners with its clients to solve complex business issues and achieve a significant return on marketing investment.

However, advisors that manage to excel in this increasingly commoditized market find a way to differentiate without following a “herd” approach. And these advisors typically are the leaders when measured by customer loyalty and retention.

Affluent investors consistently tell us what is important to them in their financial and wealth management relationships. In our AMS tracking program, we model this information to derive “key drivers” of affluent client loyalty with their advisor. From our most recent report, completed in September, 2006, the key drivers of advisor loyalty included the following:

Key Drivers of Affluent Client Loyalty With Advisor
#1. Level of knowledge of the advisor and quality of the advice provided
#2. Ability to trust the advisor; honesty and dependability displayed by the advisor
#3. Investment performance of the advisor
#4. Service quality and the ability to resolve problems
#5. Number or depth of services the client has with the advisor

Knowing what is important to their affluent clients, advisors much be able to differentiate their practices accordingly:

Loyalty Leaders

Over the past three years of tracking ratings of primary financial providers, five firms have consistently received top loyalty ratings among affluent investors: USAA, TIAA-CREF, Vanguard, A.G. Edwards, and Edward Jones. They have succeeded by differentiating on one or more of the key drivers of loyalty.

About The Phoenix Affluent Marketing Service (AMS) Program
The Phoenix Affluent Marketing Service (AMS) program is a continuously fielded survey of affluent and high net worth households throughout the U.S., and provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes. Each questionnaire, fielded bi-monthly, contains a minimum of 1,100 completed questionnaires among qualified affluent households.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com.

About Phoenix Marketing International
Phoenix Marketing International was founded in 1999 by Allen DeCotiis, Ph.D. and Martha Rea, MA. Phoenix is a privately held company. Phoenix has offices in Rhinebeck,(NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. Phoenix was founded to integrate industry expertise, research, direct marketing, modeling, and multicultural expertise to help clients address their marketing needs. Through a combination of industry experience, research, marketing, analytic modeling and multicultural expertise, Phoenix partners with its clients to solve complex business issues and achieve a significant return on marketing investment.

David Pluchino, Senior Research Manager at Phoenix Marketing International stated that the study examined advertising recall in 70 of the top video games available for current generation systems. He warned that the term ‘advertising’ should be taken loosely… gamers were not asked about what advertising they saw while playing specific games, but rather if they recalled seeing any real products within the game. If so, they were asked what they remember seeing.

More than half (54%) of gamers who have played a sports game such as Madden NFL 07 are the most likely to have recalled some form of advertising while playing the video game. Four-out-five of the top video games where some form of advertising was recalled were sport games...2006 FIFA World Cup, NHL 2K7, Madden NFL 07, NBA 2K7. Racing games are the next most popular types of games for in-game advertising recall.

Some of the more popular types of products and brands recalled (in no specific order) were...

• Apparel & Footwear – Nike, Adidas, Reebok
• Beverages – Coke, Pepsi, Mountain Dew, Gatorade
• Cars – Ford, BMW
• Electronics – Samsung
• Fast Food – McDonald’s, KFC, Burger King
• Personal Care – Axe

The first wave of Video GAMERS™ (Game Advertising & Measurement Evaluation Research Syndication) was comprised of a total of 1,502 online interviews completed between October 5 and October 11, 2006. The interviews were equally split between male and female gamers 18 years of age or older. The study was conducted among “active” gamers. To be considered active, a gamer must have played a video game on any of the following systems in the past 30-days… Microsoft Xbox 360 and Xbox, Sony Playstation 2 and PSP and the Nintendo GameCube, DS and Game Boy. In addition, the respondent must have either purchased, rented, or received that game in the past 30-days. The 1,502 interviews have a statistical accuracy of +/- 2.5 points at the 95% confidence level.
Phoenix Marketing International is one of the fastest growing top-50 marketing research firms in the U.S. and partners with many of the largest companies in the financial services, consumer package goods, automotive and travel, leisure & entertainment industries worldwide. In addition to industry expertise Phoenix has dedicated analytical groups leading the industry in advertising and brand analytics, multi-cultural expertise and direct marketing list optimization.

###

For additional Information, contact:
David Pluchino
Phoenix Marketing International
100 Davidson Avenue, Suite 108
Somerset, NJ 08873
Phone: (732) 563-8504
Fax: (732) 563-8505
Email: David.Pluchino@PhoenixMi.com

Projections of revenues generated by this segment are based on fees paid for use of check cashing services, money order purchases and international money transfers, in addition to fees paid to make bill payment transactions in-person and by telephone. "We can only estimate total revenue value at this stage", says Ken Kerr, VP Retail Payment Strategies at Phoenix ESP Payments Research Group, "because hard measures of financial product and transactions services used by this segment of the population don't exist. But the revenue opportunity this market segment represents is a key driver for non-banks looking to enter the financial services arena."

Consumer research conducted by Phoenix ESP reveals that households with limited or no banking relationships are 17 times more likely than their counterparts to pay a utility bill with a money order and more than twice as likely to pay that bill in-person. And 17% of those who pay a utility bill in person will pay a fee of $2 or more to make that transaction.

Leon Majors, President of Phoenix ESP, cautions against drawing too many conclusions from this data. "It's really just an indicator", says Majors, "because the survey was not targeted to unbanked or underbanked consumers. But by looking at this segment in our balanced consumer research sample we begin to get a glimpse of the growing and largely unmet financial needs of this customer segment, and its untapped revenue potential for banks."

Understanding the full market potential of low-income households is just the first step in developing successful sales strategies to meet current needs and cultivate long-term lucrative relationships. "Both new and established providers are scrambling to understand the right mix of products for this market segment", adds Kerr. "This will include insurance and mortgages, as well as payment products and the delivery method or combination of methods needed to successfully reach this customer base."

Success in this market segment will require not only understanding its financial needs but also its cultural concerns. For example, Phoenix ESP Consumer Payments Usage & Preferences study reveals that the percentage of low-income households with high concern about payment security is roughly double that of higher income households. Attitudes toward service providers also reflect cultural conditioning.

In a landmark study being designed for 2007, Phoenix ESP Payments Research Group will conduct benchmarking research among low-income households. The Unbanked & Low Income Financial Services Market will be the first major research study to offer a detailed, data-driven examination of trends in the growing low-income financial services market. A national survey of over 2000 low-income, unbanked, and under-banked consumers will be scaled to provide insight into all key geographic and ethnic communities.

Interviews for The Unbanked & Low Income Financial Services Market study will be conducted in language, as required, and accommodate varying levels of acculturation. The results will measure total market opportunity, appropriate financial product/services mix and specific product attributes desired by this target segment. Content will address satisfaction with and attitudes toward existing providers, use of traditional financial products and services, fees paid for services used, and attitudes toward emerging products and service delivery options.

Data cited in this press release are drawn from Phoenix ESP's 2006 Consumer Payments Usage & Preferences study based on research among a balanced panel of over 2000 U.S. consumers.

ESP Payments Research Group, a division of Phoenix Marketing International, offers full-service quantitative and qualitative research and analysis across all types of payments systems products and services. Consulting professionals with unmatched expertise in payment systems and primary research, provide solutions for clients at leading retail and corporate financial services providers and technology vendors serving the financial services industry.

Phoenix Marketing International is one of the fastest growing top-50 marketing research firms in the U.S. and partners with many of the largest companies in the financial services, consumer package goods, automotive and travel, leisure & entertainment industries worldwide. In addition to industry expertise Phoenix has dedicated analytical groups leading the industry in advertising and brand analytics, multi-cultural expertise and direct marketing list optimization.

For younger and less wealthy Emerging affluent, the everyday pocket-book issues of health care costs, energy prices, taxes and wealth protection were also of paramount concern during the past year. These households also seemed to be keenly aware of the importance of planning for retirement, as this was also a top concern throughout the year.

The need for financial security is also evident by the cash positions of affluent households. Most wealth management advisors that we have talked with recommend a cash allocation from 2-5% or so of their affluent client’s liquid assets. Affluent households, however, prefer stronger cash positions, averaging eleven percent among all affluent households, with higher cash allocations among younger Emerging affluent where cash flow is a challenge. This suggests a very conservative financial outlook, in general, with security being a high priority.

About The Phoenix Affluent Marketing Service (AMS) Program
The Phoenix Affluent Marketing Service (AMS) program is a continuously fielded survey of affluent and high net worth households throughout the U.S., and provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes. Each questionnaire, fielded bi-monthly, contains a minimum of 1,100 completed questionnaires among qualified affluent households.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com.

About Phoenix Marketing International
Phoenix Marketing International was founded in 1999 by Allen DeCotiis, Ph.D. and Martha Rea, MA. Phoenix is a privately held company. Phoenix has offices in Rhinebeck,(NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. Phoenix was founded to integrate industry expertise, research, direct marketing, modeling, and multicultural expertise to help clients address their marketing needs. Through a combination of industry experience, research, marketing, analytic modeling and multicultural expertise, Phoenix partners with its clients to solve complex business issues and achieve a significant return on marketing investment.

“This technology promises to be as disruptive to paper check processing over the next 18 months as was the conversion from paper to electronic processing of credit card transactions in the mid-1980s”, says Leon Majors, President of Phoenix ESP Payments Research Group. “Though the percentages of small businesses using or planning to use these services right now may seem small, it is important to keep in mind that they represent hundreds of thousands of companies in only three industries.”

These results from just one of a series of market studies of small businesses recently completed by Phoenix ESP Payments Research Group reveal potential for new electronic payment and payment processing methods that far exceeds original expectations and perhaps the capability of the industry to deliver. “The banking industry has yet to establish standard pricing or availability for the mass marketing of these services but the small business community already expects this new array of electronic receivables services to be available in the normal course of business”, cautions Majors.

Majors also points out that, to date, just 40,000 RDC terminals have been shipped by manufacturers, of which about 30,000 have been installed. “A handful of banks across the country, large and small, have taken the lead in providing RDC services to their customers,” adds Andy Brown, VP Small Business Payment Strategies at Phoenix ESP, “and they will have an edge because this is precisely the type of service that cements a strong relationship between customer and provider.”

Phoenix ESP research measured substantial growth over the past year in the numbers of small firms planning to use ACH and image capture by 2007. In addition to RDC interest and activity, more than half of SOHOs and small businesses in the industry segments surveyed by Phoenix ESP are familiar with e-check services (conversion of paper checks to ACH transactions) and just under 10% of these firms are already using e-check services or planning to begin using them before the end of 2007.

Phoenix ESP conducts three extensive payments research projects annually in the small business market: Small Business Banking Services, Small Business Credit Card Monitor and Small Business Retail Merchant Study. Collectively, these projects encompass almost 3,000 telephone interviews with owners/managers of businesses in six industries with revenues between $100k - $9.9mm. (Companies with revenues between $10mm - $250mm are covered in separate studies.) The data reported here are drawn from the recently completed Small Business Banking Services study.

ESP Payments Research Group, a division of Phoenix Marketing International, offers full-service quantitative and qualitative research and analysis across all types of payments systems products and services. Consulting professionals with unmatched expertise in payment systems and primary research, provide solutions for clients at leading retail and corporate financial services providers and technology vendors serving the financial services industry.

Phoenix Marketing International is one of the fastest growing top-50 marketing research firms in the U.S. and partners with many of the largest companies in the financial services, consumer package goods, automotive and travel, leisure & entertainment industries worldwide. In addition to industry expertise Phoenix has dedicated analytical groups leading the industry in advertising and brand analytics, multi-cultural expertise and direct marketing list optimization.

According to Leon Majors, President of Phoenix ESP Payments Research Group and long-time ATM market tracker, the functional improvements developed by ATM manufacturers fueled growth in consumer usage and subsequent expansion of the installed base. But Majors cautions that current changes in payment technologies will demand more change. “The Check 21 environment and ARC technologies make it possible for checks to be truncated at their first point of entry into the processing system,” says Majors. “That entry point could be an ATM – and the industry perceives the ATM as a key part of these technology strategies.”

Since 2000, more than 128,000 units have been added to the ATM installed base. Non-bank ATM marketers added 73% of these units, fairly blanketing the country with ready access to cash through limited function cash-dispensers virtually around every corner. The result has been to commoditize automated cash access and to embed the expectation of ATM availability in the American psyche – especially among key demographics like the mass affluent segment where ESP consumer data indicates that ATM access is key to keeping relationships, even when ATM use is occasional. Financial institutions are positioned and poised to exploit this expectation by adding value that will broaden the utility of the ATM beyond its current core user base.

“By adding sophisticated technologies, such as imaging, deposit automation, check cashing, and Internet access to ATMs,” says Majors, “banks will have the ability to reach into markets with automation that they have not yet been able to develop without a full branch presence. The potential for relationship and revenue enhancement in the small business market and the unbanked/underbanked consumer segment is enormous.”

Phoenix ESP Payments Research Group conducts an annual ATM Market Tracker survey of more than 2,000 ATM-owning banks and credit unions and major ISO/Retail ATM marketers. Survey results and analyses have been supporting the strategic planning and marketing decisions at major financial institutions and equipment manufacturers for more than 20 years.

ESP Payments Research Group, a division of Phoenix Marketing International, offers full-service quantitative and qualitative research and analysis across all types of payments systems products and services. Consulting professionals with unmatched expertise in payment systems and primary research, provide solutions for clients at leading retail and corporate financial services providers and technology vendors serving the financial services industry.

About Phoenix Marketing International Phoenix is one of the fastest growing top-50 marketing research firms in the U.S. and partners with many of the largest companies in the financial services, consumer package goods, automotive and travel, leisure & entertainment industries worldwide. In addition to industry expertise Phoenix has dedicated analytical groups leading the industry in advertising and brand analytics, multi-cultural expertise and direct marketing list optimization.

Every other month, the Phoenix Marketing International Affluent Marketing Service&trade (AMS) tracks changes that affluent and high net worth households anticipate making to their investment portfolios in the next three months. This article examines the investment sentiment of Mass Affluent investors and the financial services distribution channels that will most likely receive additional assets from these investors.

Mass Affluent Market ($250k - $999k Investable Assets)

In the August, 2006, AMS tracking period, in the Mass Affluent market, investment sentiment turned more bullish.

In August, 44% of Mass Affluent households stated they were likely to make net increases to their portfolios in the next three months, up seven percentage points from June. 52% of these households indicated likelihood to make no changes, down from 58%, while 4% said they were likely to make net decreases to their portfolios.

The “Investment Sentiment Trend Line”, depicted in the charts below, shows the percentage of Mass Affluent consumers that anticipate making increases to various asset class categories, including stocks, mutual funds, fixed income, real estate, business investments, deposit accounts, alternative investments, and retirement accounts. (The base is those 44% who say they planned to make net increases to their portfolios.)

In August, Mass Affluent investors have decreased interest in stocks, mutual funds, bonds, and real estate, and increased interest in cash positions

• Stocks: 29% likely to increase positions; up down significantly from June
• Mutual Funds: 31% likely; down significantly from June and continuing a three period decline
• Fixed Income: 9% likely; continuing down from 19% in June
• Alternative Investments: 3% likely; down from 9% in June
• Retirement Accounts: 48% likely; down from 60% in June
• Deposit Accounts: 71% likely, up significantly from June
• Real Estate: 13% likely; no down from 21% in the previous 3 periods
• Business Investments: 11% likely, up from 9% in June

Investment Sentiment: Percent Likely To Increase Holdings In Next 3 Months Tracking Periods: June 2005 – August 2006 Mass Affluent Households (click image to enlarge)

Base: plan to make net increases or decreases to overall investments in the next 3 months

Channels Likely To Receive New Assets In Next 3 Months – Mass Affluent
Deposit Accounts, Stocks, Mutual Funds, Retirement Accounts, Fixed Income Accounts

Trends worth watching:

• Full Service Brokers: decreased interest in adding new assets to deposit and fixed income accounts to these firms
• Online/Discount Brokers: decreased interest in adding new assets to stock portfolios held at these firms
• Independents: increased interest in adding to mutual fund and retirement account positions at these firms

$1 Million+ Investable Assets

In August, millionaire investors became even more cautious in their investment sentiment, as only 39% indicated likelihood to make net increases to their portfolios, continuing a downward trend from 48% in April.

54% of millionaire households felt that they would make no net increases to their investments over the next three months, up from 49% in June and 46% in April. 7% felt that they would make net decreases, up from 5% in June.

$1 million+ Investment Sentiment Trend Lines includes:

In June, Millionaire investors became less bullish on mutual funds, deposit accounts and retirement accounts. Sentiment towards real estate actually rebounded from the June tracking period.

• Stocks: 48% likely to increase positions, up significantly from 46% in February
• Mutual Funds: 47% likely; continuing a 3 month decline
• Fixed Income: 27% likely; back up 1 point from June
• Retirement Accounts: 52% likely; continuing a 3 month decline since April
• Deposit Accounts: 13% likely, up 1 point from June
• Alternative Investments: 50% likely; continuing a 3 month slight decline
• Business Investments: 14% likely; down 1 point from June and continuing a 3 month decline
• Real Estate: 25% likely; up from 23% in June

Investment Sentiment: Percent Likely To Increase Holdings In Next 3 Months Tracking Periods: June 2005 – August 2006 $1 Million+ Investable Assets (click image to enlarge)

Base: plan to make net increases or decreases to overall investments in the next 3 months

Channels Likely To Receive New Assets In Next 3 Months – $1 MM+ Investable
Deposit Accounts, Stocks, Mutual Funds, Retirement Accounts, Fixed Income Accounts

Trends worth watching:

• Online/Discount Brokers: 3 tracking period increased interest in adding new fixed income account assets to these firms
• Mutual Fund Companies: increased interest in adding to deposit account and mutual fund positions at these firms, and decreased interest in fixed income accounts.
• Banks: decreased interest in adding to mutual fund positions at these firms
• Independents: increased interest in adding to their stock, retirement account and fixed income account positions at these firms
• Private Banks: increased interest in adding to their stock and retirement accounts at these firms

About The Phoenix Affluent Marketing Service (AMS) Program
The Phoenix Affluent Marketing Service (AMS) program is a continuously fielded survey of affluent and high net worth households throughout the U.S., and provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes. Each questionnaire, fielded bi-monthly, contains a minimum of 1,100 completed questionnaires among qualified affluent households.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com. Or visit the Phoenix Marketing International web site at www.phoenixmi.com.

About Phoenix Marketing International
Phoenix Marketing International was founded in 1999 by Allen DeCotiis, Ph.D. and Martha Rea, MA. Phoenix is a privately held company. Phoenix has offices in Rhinebeck,(NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. Phoenix was founded to integrate industry expertise, research, direct marketing, modeling, and multicultural expertise to help clients address their marketing needs. Through a combination of industry experience, research, marketing, analytic modeling and multicultural expertise, Phoenix partners with its clients to solve complex business issues and achieve a significant return on marketing investment.

Asset consolidation is one such leading indicator. Ten years ago, affluent investors often cited a wealth management firm’s unique advisory services as one of the main reasons for consolidating assets with that firm. However, new data from Phoenix Marketing International’s Affluent Marketing Service&trade shows that affluent and high net worth investors have increasingly been reluctant to look to one institution for all of their wealth management solutions. “This raises the question of what is the incentive to consolidate”, says David M. Thompson, Vice President of the Affluent Practice at Phoenix Marketing. “In fact, many advisors that we talk to admit that they are beginning to look like one another”, adds Thompson.

While the Phoenix data demonstrates that independent advisors/planners have done the best job at fostering client loyalty, satisfaction and loyalty scores for many leading wealth management institutions have not improved, on average, in the past three years. This suggests that it is getting harder for wealth management firms to differentiate in the affluent and HNW markets.

Loyalty Barometer
Primary Provider Channel - Total Affluent Market
Three Year Trend

Wealth management itself has become increasingly commoditized. Private banks, and, to some extent, trust groups, once could differentiate through access to specialists, offering investment and risk management, estate, philanthropic and legacy planning, tax, insurance, and credit services. Today, it’s become increasingly crowded at the top, and team-based approaches have been pushed down-market. Most of the wirehouses tout team-based solutions to wealth management, and many regional broker-deals, banks, and independent advisors are embracing this approach. Product and open architecture have ceased to be a differentiator.

There are ways to differentiate without following a “herd” approach. “Affluent investors consistently tell us what is important to them in their financial and wealth management relationships”, says Thompson. “This feedback presents opportunities for differentiation and improved relationships with affluent clients”.

The Phoenix study lists a number of ways that wealth management firms can differentiate to retain and attract affluent clients:

About The Phoenix Affluent Marketing Service (AMS) Program

Data from this article is drawn from the Phoenix Affluent Marketing Service (AMS) surveys conducted over the past year (August, 2005 to June, 2006), and is based on 7,396 interviews. The data are weighted to be representative of affluent households nationally (minimum of $250,000 in investable assets and/or $150,000 household income).

The Phoenix Affluent Marketing Service (AMS) program is a continuously fielded survey of affluent and high net worth households throughout the U.S., and provides an ongoing summary of affluent and high net worth household investment, financial and affluent lifestyle behaviors and attitudes.

For more information about the AMS program, contact David Thompson at 860.651.8400 or by email at David.Thompson@PhoenixMI.com.

About Phoenix Marketing International

Phoenix Marketing International was founded in 1999 by Allen DeCotiis, Ph.D. and Martha Rea, MA. Phoenix is a privately held company. Phoenix has offices in Rhinebeck,(NY), Somerset (NJ), Detroit, Boston, Salisbury (MD), Chicago, Los Angeles, Tampa and Miami. Phoenix was founded to integrate industry expertise, research, direct marketing, modeling, and multicultural expertise to help clients address their marketing needs. Through a combination of industry experience, research, marketing, analytic modeling and multicultural expertise, Phoenix partners with its clients to solve complex business issues and achieve a significant return on marketing investment.