Month Day, Year Alliance Data Breaking Down FCR to Drive Change

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 2 About Alliance Data Interaction Analytics FCR/Repeat Call Analysis Defining FCR Full Sample Analysis 384 Call Breakdown Q&A Agenda

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 3 Alliance Data Retail Services helps our partners drive more sales through branded credit programs — Know More. Sell More. ® is the Alliance Data commitment. We combine unique customer insight and loyalty-marketing expertise to drive measurable results for our partners: increased sales, greater brand affinity, and stronger customer relationships. Clients include many best-known retail brands. We provide customer care for the branded credit cards issued by our two subsidiary banks.

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 4 About Alliance Data Sites in Columbus, Westerville and Milford, OH; Lenexa, KS and Westminster, CO 2,200 Customer Care agents (Sales & Service, Collections) Approximately 35 million IVR and floor calls annually NICE Systems Products Version 3.2 (4.1 upgrade pending) Quality Management Interaction Analytics IEX Five customer care locations

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 5 Interaction Analytics Team Four person dedicated team Retail Marketing reporting structure Work with all areas of the organization ranging from Client Sales to Marketing to Operations Combined 27 years Alliance Data experience Diverse backgrounds: Analysis, Call Center, Training, Management, Quality, and Documentation Interaction Analytics Version 3.2 (4.1 upgrade pending) Approximately 70 monitoring categories Business data categories Word/phrase based categories

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 6 Defining FCR What means are available to measure FCR? Post call survey: a question asking if the customer feels their issue has been resolved Customer call-in information: IVR/NLU or Account Number based Repeat caller numbers or FCR Package: utilize the NICE solution to measure our FCR rate What timeline should we look at? 7 days? 15/20/30-day? Should we look at 45 days? Which option would best reflect our customer base and objectives There was not a right or wrong answer. The important part is picking a timeline and having the ability to benchmark and measure consistently.

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 7 Repeat Calls by Call Type Analyzing the total sample during the 45 day period shows that the top call types require multiple calls for resolution Break-out shows volume of repeat calls for each category and associated percentage 55,47027,569

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 8 AHT Impact The overall average handle time increased by 3:41 when it was a repeat call Looking at this impact shows that not only does the volume of calls increase, but there is also an increase in AHT when the call is a repeat 3:323:364:104:302:564:013:413:043:394:113:03

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 9 Root Cause Analysis Dissatisfaction The 2 most common terms being used in repeat calls are the same phrases being used in dissatisfied calls Escalation The third most common term is asking for a supervisor and many of the calls are transferred to a supervisor or resolution specialist Confusion Phrases like “do not understand” and “do not know” show customers are confused about their account

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 10 Root Cause Analysis Lack of understanding is centered around charges on the customer’s statements In particular, customers are confused about their statement balance caused by finance charges and pay by phone fees In previous calls, customers were not advised that the fee would appear on the statement but was deducted from the balance

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 11 Initial Investigation Payment accounts for 17% of the repeat calls Payments not posting within 5 days of being mailed Customers not able to use a credit card to make payments Customers calling to update promise to pay Balance accounts for 16% of the repeat calls Customers not being charged correctly for items shipped Store charged/opened PLCC verses using Visa or MasterCard for initial purchase

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 12 Repeat Calls Drivers Policy/Process Returns are not posted to the customer’s account same day Delay in funds being debited from checking account (PBP and eCS) Cannot make a payment with a credit card Payment was made but Collections department is continuing to call same day

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 13 Recommendations provided to the business Joint effort with operations leadership Not just call center operations recommendations, many were Alliance Data policies and processes All recommendations have an owner and expectation Follow-up analysis once changes occur Determine FCR impact and if there is a shift in Repeat Call drivers Revisit the 384 analysis quarterly to maintain understanding of FCR drivers FCR package Does the organization see enough value to enhance our current solution? Joint effort with operations Analysis Outcome

Alliance Data Interaction Analytics | ©2012 ADS Alliance Data Systems, Inc. Confidential and Proprietary 14 Questions? Dan Zabloudil Alliance Data Interaction Analytics Team T: (614) E: