Change in Comp Structure plus a Reminder

We've decided to set the 'Subscription' Merchandise Type to a flat 35%, and remove tiers involved in it.

Also, we will be evaluating the compensation amounts on a quarterly basis to ensure that affiliates are being paid the appropriate value for each product. The first evaluation will be in February, and we will be looking at the lifetime values of the products sold through the affiliate program.

One thing to remember about this change: The reason WHY we changed the structure is because of the internal accounting system not being able to attribute cancels due to package migration to the appropriate source. This also meant that when a user upgraded, we couldn't credit the referring affiliate with the sale. In order to avoid affiliates being incorrectly charged back for users changing their packages, we decided to start paying on the LifeTime Value (LTV) of the product.

What does all this gobbledy-gook mean? Basically, it means that we increased the commission percentages because we knew that the sales credited to affiliates would decrease.

We've been getting a lot of questions about decreases in sales year over year and month over month. Please do not focus on sales dollars and quantity changes from before December 8 versus afterward. If you want to compare performance, look at compensation FIRST.

Let us know if you have any questions - affiliate@ancestry.com or 801-705-7850.

Reporting Issues Resolutions

Over the last several weeks, we have been experiencing reporting glitches and difficulties. As you will see, there is also some to-be-resolved issues that we're trying to make happen ASAP. The following is the status/solution for each day of reporting from December 1 to present.

December 1 - 7:
Daily BeFree batch correctly uploaded, numbers verified, matches internal reporting
Status: NO ACTION NECESSARY
Accuracy: All Revenue stats are accurate for these days

December 8 - 11:
Launch of New Pricing and Packaging
Daily BeFree batch included small % of erroneous sales due to migrating old customers to the new packaging
Daily BeFree batch included small % of erroneous cancels due to migration
Fix File to correct erroneous cancels sent and uploaded on December 16
Fix File to correct erroneous sales sent and uploaded on December 21
Status: RESOLVED
Accuracy: Only NET SHIPPED SALES are accurate for these days (NOT cancels, orders or gross)

December 12 - 14:
Daily BeFree batch included small % of erroneous sales due to migrating old customers to the new packaging
Fix File to correct erroneous sales sent and uploaded on December 21
Status: RESOLVED
Accuracy: Only NET SHIPPED SALES are accurate for these days (NOT cancels, orders or gross)

December 15:
Daily BeFree batch includes correct number of products
Daily BeFree batch includes duplicate subscriptions and cancels (exact duplication - divide by 2 for accurate number)
Status: RESOLVED; fix file sent 1/7
Accuracy: Only NET SHIPPED SALES are accurate for these days (NOT cancels, orders or gross).

December 16:
Daily BeFree batch ONLY includes products, no subscriptions or cancels
Status: RESOLVED; fix file sent 1/6
Accuracy: ALL revenue stats will be accurate for this day.

December 17 - 22:
Daily BeFree batch correctly uploaded, numbers verified, matches internal reporting
Status: NO ACTION NECESSARY
Accuracy: All Revenue stats are accurate for these days

December 23 - 25:
New pricing/packaging free trialers scheduled to bill. Error in accounting system delays billing over holidays. Because of this, NO free trials bill.
Daily BeFree batch correctly uploaded, numbers verified, matches internal reporting
Status: RESOLVED; all free trials billed on 1/7
Accuracy: All Revenue stats are accurate for hard offers and free trial sign-ups ONLY, however, reporting will NOT change retroactively for these days. Billed Free Trials are attributed to January 7th.

December 26:
Daily BeFree batch includes correct number of products
Daily BeFree batch includes duplicate subscriptions and cancels (exact duplication - divide by 2 for accurate number)
Free trialers not billing through
Status: RESOLVED; fix file sent 1/7
Accuracy: Only NET SHIPPED SALES will be accurate for these days (NOT cancels, orders or gross), with the following exceptions:
Will not include billed free trials. Cancel rate will NOT be accurate.

December 27:
Daily BeFree batch ONLY includes products, no subscriptions or cancels
Free trialers not billing through
Status: RESOLVED; fix file sent 1/7
Accuracy: All revenue stats will be accurate for this day, with the following exceptions:
Will not include billed free trials. Cancel rate will NOT be accurate.

December 28 - January 1:
Daily BeFree batch correctly uploaded, numbers verified, matches internal reporting
Free trialers not billing through
Status: NO ACTION NECESSARY (except Free Trial fix)
Accuracy: All Revenue stats are accurate for hard offers and free trial sign-ups ONLY. Cancel rate will NOT be accurate.

January 2:
Daily BeFree batch includes correct number of products
Daily BeFree batch includes triplicate subscriptions and cancels (exact triplication - divide by 3 for accurate number)
Free trialers not billing through
Status: RESOLVED; fix file sent 1/7
Accuracy: Only NET SHIPPED SALES will be accurate for these days (NOT cancels, orders or gross), with the following exceptions:
Will not include billed free trials.

January 3 - 6:
Daily BeFree batch ONLY includes products, no subscriptions or cancels
Free trialers not billing through
Status: RESOLVED; fix file sent 1/7
Accuracy: ALL revenue stats will be accurate for this day, with the following exceptions:
Will not include billed free trials. Cancel rate will NOT be accurate.

January 7:
Daily BeFree batch included all Free Trials that were signed up for from Dec 8 - December 24
Status: NO ACTION NECESSARY
Accuracy: Rates of any kind are not accurate this day because of the disproportion of the data. However, Net Shipped Sales are accurate.

January 8 - 10:
Daily BeFree batch is including products from the previous day and subscriptions and cancels from 2 days prior, resulting in a delay of subscription data by 1 day
Status: NOT RESOLVED - awaiting technical fix that allows batch processing to occur in a timely manner
Accuracy: All revenue stats are accurate, they are just 1 day late

Remember, the way that we have to fix erroneous sales is by using cancels, and fixing erroneous cancels is using sales (resulting in a 100% cancel rate for thos particular errors). So the cancel rate and cancel amount cannot be trusted for the month as a whole. But there are some days (noted above) where you can use these as evaluations.

As you can see, we've gone through a lot in the last month, and it feels like every time we fix one problem, we find another. Thanks so much for your troubleshooting, and for sticking with us while these issues get worked out. Our hope is to restore your confidence in BeFree data as soon as possible.

February is Black History Month

I wanted to give you a lot of lead time on a fairly large promotion that Ancestry.com will be involved in, beginning February 1. To celebrate Black History month, we are partnering with PBS, Coca-Cola, Proctor and Gamble and the Boys and Girls Club of America for a month-long campaign. The following will be going on:

1) PBS will air a show called "African American Lives" on Feb 1 and Feb 8 (with 4 years of syndication following) in which they will present 8 famous African Americans with their family tree and narrate one story in particular. We provided the research and support for the show's content.

2) Coca-cola is doing a sweepstakes during the month of February promoting the PBS show, Black History month, and family history. Through that sweepstakes, we will be giving away 3500 copies of FTM + World Deluxe Annual subs and 10 consultations with a professional genealogist. I believe Coke is giving away trips to your homeland, or something like that. Coke will brand PBS and Ancestry.com on the packaging, and the sweepstakes will be in 8 major markets across the country.

3) Proctor and Gamble is promoting the PBS show in Target stores on end-cap displays, using one of 8 brands... I can only remember 5: Pringles, Pampers, Downey, Charmin and Crest. They will be branding Coke, PBS and Ancestry.com during this February month-long promotion, nationwide.

4) PBS will be holding an educators training in each of the 8 major markets, giving teachers the resources and encouragement to teach their students about doing genealogy. Ancestry.com will have a presence at these trainings, and will be giving away 10,000 copies of "Creating Junior Genealogists" (http://shops.ancestry.com/product.asp?productid=3562&shopid=0).

5) PBS will be joining with Boys and Girls Club of America to encourage participation in family history during the month of February, and Ancestry.com will be providing each club/chapter with a free subscription and a portal designed specifically for the BGCA.

In addition to all these promotions we are joining with other companies to do, Ancestry.com will independently be doing the following to promote Black History in the month of February:

1) We are creating a Content Center (similar to the current ones, found here: http://www.ancestry.com/learn/contentcenters/contentCenter.aspx?page=census) which will reside in the current Learning Center. This center will aggregate all of our Black History content, and will be called "African American History Center".

2) There are 13 databases that are relevant to Black History, and Ancestry.com will be offering them for FREE during the full month of February, through the content center mentioned above. We will be making graphical and textual links available for affiliates, and using the content center as our landing page for the promotion (and probably post-promo for permanent links to African American content).

This would be a great time for affiliates to develop African American-centric content to take advantage of the attention and interest in family history caused by this promo. As we develop more ways to promote and publicize Black History Month, we will keep you updated.

Let us know if you have any ideas or requests that would be valuable to this campaign!

Affiliate Team Holiday Schedule

FYI - The affiliate offices will have the following schedule over the next couple weeks:

CLOSED - No One Available
December 26
December 27
January 2

MINIMAL STAFF - 1 to 2 Team Members Available
December 23
December 28
December 29
December 30

Thanks for your patience during the Holidays. We hope you have a very Merry Christmas and Wonderful New Year!

Important Notice to All Affiliates

Ancestry.com will be launching a new pricing and packaging model to new and current subscribers. To align affiliate compensation with the new pricing and packaging, the commission structure will change. Instead of offering a percent of sales commission, the new compensation model will pay bounties for each subscription.

To better understand the changes, here is a brief description of each package followed by the new compensation structure. Both packages will be offered as annual or monthly subscriptions.

• US Deluxe — Access to all US record indexes and images, plus historical newspapers, family and local histories and more on Ancestry.com
• World Deluxe — Unlimited access to the entire worldwide collection of records, information and images on Ancestry.com

New affiliate compensation:

World Deluxe – Annual $299.40

Orders per Month	Bounty	Revenue Share
1 to 6	$69.00	23%
7 to 16	$115.00	38%
17 +	$160.00	53%

World Deluxe – Monthly $34.95

Orders per Month	Bounty	Revenue Share
1 to 12	$15.00	43%
13 to 32	$23.00	66%
33 +	$31.00	89%

US Deluxe – Annual $179.40

Orders per Month	Bounty	Revenue Share
1 to 6	$40.00	22%
7 to 16	$67.00	37%
17 +	$94.00	52%

US Deluxe – Monthly $23.95

Orders per Month	Bounty	Revenue Share
1 to 12	$10.00	42%
13 to 32	$15.00	63%
33 +	$20.00	84%

Products, VitalCheck, Genealogy.com & MyFamily.com

Sales per Month	Bounty	Revenue Share
$0 – 499	n/a	15%
$500 – 2,000	n/a	25%
$2,000 +	n/a	35%

Note: This compensation structure will be activated the same time Ancestry.com launches the new pricing and packaging.

For the latest updates, details and program information be sure to check the affiliate blog (http://ancestryaffiliates.blogspot.com/) or www.reporting.net.

Feel free to email us with any questions you may have at affiliate@ancestry.com.