Segment Reporting
We manage our business and report our financial results through the following
three reportable segments:
• Equifax North America
• Equifax Europe
• Equifax Latin America
The North American reportable segment is made up of three operating segments:
• Information Services
• Marketing Services
• Consumer Direct
The Europe and Latin America reportable segments are made up of varying mixes
of three product lines: Information Services, Marketing Services, and Consumer
Direct.
Equifax North America is our largest reportable segment and includes results
of our Information Services, Marketing Services, and Consumer Direct operating
segments in the United States and Canada.
Our strategic objective for Equifax North America is to provide products that:
• Enable customers to utilize an individual's or small business's credit history
in determining whom to do business with;
• Assist customers in reducing the impact of fraudulent activities;
• Assist companies in the management of their credit portfolios;
• Enable customers to manage their debt recovery activities;
• Enable customers to market specific products and services to consumers;
• Enable customers to develop marketing strategies for cross-selling other
products and services to their entire customer base;
• Enlighten, empower and enable consumers to manage information on their personal
credit and financial histories; and
• Enable customers to comply with Federal legislation in their customer management
and ID verification processes.
Our Predictive Sciences solutions include (1) the statistical analysis of data,
(2) the integration of software and computer technology to execute decision
rules, and (3) consulting in the formulation and execution of decision strategies
to maximize revenue opportunities for the customers of our Information and Marketing
Services businesses. We also sell our services to institutions that may not
be customers for our information services utilizing our data agnostic capabilities
and technologies.
Information Services
In Equifax North America, our Information Services operating segment consists
of the following components: Consumer Services, Commercial Services, Mortgage
Services and our Canadian Operations.
Our Consumer Services products and services are derived from the credit information
that we maintain about individual consumers, and are the dominant products and
services in our Equifax North America segment. We maintain information on more
than 220 million consumers in North America, where we are a market leader in
Consumer Services. We offer a full range of Consumer Services products in our
North America markets, including credit reporting, credit scoring, mortgage
reporting, prescreen services, risk management, fraud detection and modeling
services, and certain of our decisioning products that facilitate pre-approved
offers of credit that automate a variety of decisions.
Our customers utilize the information we provide to make decisions for a wide
range of credit and business purposes, such as whether to, and on what terms
to, approve mortgage or auto loans, credit card applications, identity verification,
and similar business uses. Risk management and fraud detection and prevention
services enable banks and financial institutions to monitor default rates by
proactively managing their existing credit card accounts.
Marketing Services
Our Marketing Services operating segment includes our Credit Marketing and
Direct Marketing products and services. Our Credit Marketing products and services,
available in the United States, Canada, Latin America, and the U.K., utilize
our consumer credit information databases through batch processing to help our
customers acquire new customers and monitor current relationships using a variety
of products and services including prescreen and account review services.
We offer a full range of credit and direct marketing products in the United
States, which provide customers with the tools they need to maximize and manage
their customer marketing efforts, effectively utilize a variety of marketing
methods, efficiently identify and acquire new customers, and realize additional
revenue from existing customers. Our Marketing Services products enable customers
to:
• Identify, target, and reach the best prospects and customers;
• Utilize our accurate and powerful consumer databases to manage their customer
portfolios;
• Segment customers according to particular criteria;
• Select from specialty, self-reported, or permission-based direct mailing
lists;
• Easily access online customer mailing lists;
• Use "what-if" scenarios to create customized mailing lists online;
• Improve their direct mail response rate; and
• Reduce costs associated with unwanted or unnecessary mailings.
We provide Direct Marketing Services products, such as compiled, self-reported
and permission-based consumer marketing databases and services, and integrated
precision marketing tools that enable marketers to identify, target, and build
consumer relationships through postal and email marketing. Our targeted, high
quality, demographic and lifestyle information lists, and list performance services,
which include data enhancement, list hygiene, modeling and analytical consulting,
facilitate improved direct mail response, and increased customer loyalty. Our
products enable customers to target specifically defined market segments, individuals,
and to design more effective and economically efficient marketing campaigns.
Customers include financial institutions, insurers, catalogers, publishers,
technology companies, manufacturers and telecommunications companies.
Consumer Direct
We offer credit information directly to consumers in the United States via
the Internet at www.equifax.com. Equifax Credit Profile® provides secure online
access to a user-friendly credit report, Equifax Credit Watch™ is a subscription
service that assists consumers in protecting against identity fraud, ScorePower®
gives consumers access to their BEACON 96™ score and our 3-in-1 Credit Report™
combines reports from the three U.S. credit reporting agencies. We also offer
insurance reports and scores and offline, paper versions of our products. In
September 2003, we began offering Equifax Credit Profile to U.K. consumers.
We now offer our consumer products in the U.S., Canada and the U.K. and intend
to continue expanding our product offerings geographically through creative
marketing strategies for profitable growth. Customers of our Consumer Direct
products include consumers, as well as businesses that offer Consumer Direct
products to their customers.
Equifax Europe
The Equifax Europe segment consists of our operations conducted in the United
Kingdom, Ireland, Spain, Italy, and Portugal.
Our Information Services product line is sold in each country that makes up
the Equifax Europe segment except for Ireland, where we have support operations.
These products are based on more than 45 million consumer credit records that
we maintain. The Consumer Services products we provide in Equifax Europe include
credit reporting, credit scoring, risk management, fraud detection, and modeling
services. Our Commercial Services products, such as credit reporting and commercial
risk management services, are also available predominately in the United Kingdom.
During the third quarter of 2002 we made the decision to exit the Commercial
Services business in Spain and this business is now held for sale and reported
as Discontinued Operations.
Equifax Latin America
The Equifax Latin America segment consists of our operations conducted in Brazil,
Argentina, Chile, El Salvador, Peru, and Uruguay, Brazil. We employ approximately
1,060 employees in the Equifax Latin America segment. Our Information Services
product and services line is sold in each country of Equifax Latin America and
our Consumer Services products and services are the dominant source of revenue
in each of these countries, with the exception of Brazil. We offer a full range
of Consumer Services products based on the consumer credit records that we maintain
on more than 72 million consumers in Latin America, including: credit reporting,
credit scoring, risk management, identity verification, and fraud detection
services