The Art Of Selling Pallas

1. The Art Of Selling Pallas Inflection Point Opportunity

2. 2007 Review: Designers’ Love of Textiles • Designers’ passionate about textiles • Consistently hear: • “I usually can’t get an appointment” • “That’s the most they’ve ever spoken” • “I’ve never met with that many designers” • Pallas great way to develop designer relationships • Color, texture, pattern are the tools of their trade • With so many standards programs, textiles represent a rare opportunity for creativity in project • How do designers market themselves? • Word of mouth • Press photography/articles • To differentiate their work, they use textiles with a splash of color, texture, or pattern .

3. 2007 Review: Pallas “Halo” Products • If A & D see textiles as an essential way to differentiate themselves, then they will look for differentiated textiles • Pallas had functional, durable products, but not differentiated enough to bring designers to the brand • “Halo” or company defining products: Lexus • Minimal sales of Lexus self park on LS… • Drives brand awareness and sales of ES & RS • Often the “halo” or “wow” textiles are used in lobby areas, where the designer is communicating the identity of the company, and limited yardage • However these textiles drive the color palette of the project • Important to have “wow” and more useable textiles in every collection

4. 2007 Pallas Product Evolution • “Stripe Up The Bands” • A super usable stripe, w/ a rich textural combination of boucle and chenille yarns, and a unique corded effect • “I’ll Take Manhattan” • Inspired by the finest quality shirting cloths Manhattan offers, ITM is a tailored panel fabric w/subtle striations of color (Madison) and texture (Park), coordinated with a larger scale coordinate (Lex), constructed w/100% recycled polyester • “Kaleidescope” • Elegant high performance collection w/sophisticated layering of pattern • Aurora-striations of color w/nubby texture • Illusion-small scale geometric pattern overlaid on Aurora, yielding a deep, layered look • Chroma-fine striaes of color overlaid with a horizontal banding • Prism-larger scale pattern w/ hand drawn, warm appeal

5. 2007 Pallas Product Evolution • “Common Ground” • Busy Bee-gorgeous stylized organic, large scale pattern w/beautiful layering and depth (35% recycled polyester) • Turtle Neck-sophisticated, pleated patterning w/texture, made of 100% recyclable solution dyed nylon for superior cleanability • Workhorse-small scale coordinate w/a metallic like sheen, using 100% recyclable solution dyed nylon for superior cleanability • Holy Cow-a faux leather utilizing 100% polyurethane (no vinyl or PVC) w/ the supple hand of leather, a color line w/unique brights and neutrals, and the performance of a vinyl • Sales double that of typical Pallas collection • “Holy Cow” was #5 best selling upholstery in 2007 (although introduced in July 2007), and will be #1 best selling product in 2008 • BOY “Best of Year” Award, Interior Design Magazine voted by 21,000 designers

6. 2007 Pallas Product Evolution • “Tribute” • Bamboo upholsteries offer an elegant hand and silky sheen, high durability, are naturally anti bacterial, and made using a rapidly renewable resource • Endurance-epingle cut and loop w/a beautifully soft hand, excellent durability, and a long color line of brights and neutrals • Perseverance-intricate rib construction w/chenille, paired with a broad color range from buttoned down neutrals to sophisticated and bold color statements • “Common Ground” & “Tribute” helped change perceptions of Pallas, and helped spark a new interest in our brand • Opened the door to NY Gensler Resource Library, where we hadn’t been in six years • Chicago Gensler “Workhorse”

7. 2007 Review: Marketing Progress • Historically only one give away/direct mail marketing campaign/promotion per year • “I’ll Take Manhattan” • Direct mail and e-mail • “Common Ground” • Direct mail and e-mail • Redesigned “Romance” to be graphic and visual, and to do double duty as “Romance” and as a direct mail piece • “Tribute” • Direct mail and e-mail

8. 2007 Pallas Progress • Pallas has some “buzz” now, and designers have started to look at us • We took market share in 2007 • ACT projected market growth of 5% • Pallas Sales +26% • Good news is Pallas 2007 sales only represent 1.5% of total market!

9. 2008 Product Introductions “Rock”! • Verysolid and consistent product introductions for 2008, building on the success of 2007 • Simply Real collection • Neocon East and Healthcare Show-Bags were in high demand • Viva Italia • Smart, stylish addition • Carte blanche • Already working on a project w/HOK san Francisco • Glenn Peckman collection • Tracey Reinberg collection • Beautiful, sophisticated, elegant • Very confident that 2008 will be one of the best product years ever for Pallas

10. Pallas Inflection Point • “People become unstoppable when they are moved by a common vision, and have the power and tools to achieve it.” UT Corp • Product design will continue to improve for 2008, building on the success of 2007 • Common Ground critical and commercial appeal • BOY Award • Holy Cow will be best selling upholstery in 2008 • Our success in 2008 depends upon how well we tell the story to our customers

11. Interior Design Magazine Survey Results For ACT • Why important to maximize each opportunity to tell the Pallas story well? • Small window of opportunity each time we present to A&D • Designers look at 5 preferred brands • 80% of the time look to preferred brands • 20% of the time look to new brands • If we can tell a more engaging story story, we’ll be specified for more projects, however to tell a better story, we need a better understanding of our customer

12. Meet Yumi • She isa Designer for Gensler • She has a degree from the Art Institute in Interior Architecture • She drives a Mini Cooper • She admires Karim Rashid -- a young, hip, industry designer • For her, designing is like preparing a gourmet meal for a date • Working with a client is like unraveling a puzzle--it’s creative, reliable, and about performance • She worries about: her reputation, deadlines, and budgets • She hopes for recognitionand wants to make a difference • When specifying textile brands,shewants to feel inspired, confident in choices, intelligent, personal integrity, and passion

13. Key Themes From Customer Interviews • Reps need to be knowledgeable • Latent affection for Pallas • Reps need to provide design intent • Customers want the story behind the design • Yumi wants the knowledge we have to share

14. How Can We Better Connect With Yumi? • Better tools • Pallas marketing has evolved to help you more effectively tell the Pallas story • BOY award: marketing & PR • Direct mail piece • E-mail piece • BOY tent fold campaign • Environmental campaign • Healthcare campaign

15. Bringing People Into The Pallas Story • Don’t talk to your customers, engage them • Tell a story: Quick Pallas Renaissance story • 90’s prominence, now refocused the brand to offer inspiring textiles • Sell luxury first, color, texture, and pattern • Color-accentuate the bright and bold, then show neutrals • Texture-fabrics have tactile appeal, so touch the fabric, which encourages them to do the same • Pattern-bold and graphic, or complex and layered • Then talk features and benefits, 100,000 double rubs, Nanotex, Crypton, and environmental • If they don’t like it, all the features & benefits don’t matter

16. The Pallas Story • Buzz words from product introduction calls, romance story, etc • Key words and phrases from our branding work: • Brand Promise • “Thoughtful Expertise” • Brand Essence • “Smart, Stylish, Timeless, Sophisticated, Approachable” • Brand Worldview • “Timeless design makes the essential beautiful”

17. The Art Of Selling Pallas Inflection Point Opportunity