PFSweb, Inc. Company▲			PFSW Ticker▲			Q1 2008 Earnings Call Event Type▲			May 13, 2008 Date▲

<Q — John Fitzgerald>: Why do you think that is?

<A — Mark Layton>: I’m not the professional on the Wall Street side. So that’s why I rely on the financial advisors that we’ve got. We’ve talked to a number of our large shareholders. And clearly as I acknowledged, we understand there are pros and cons. The outweighing factor here is the competitive environment that we see from a customer standpoint and our need to kind of get this cloud out of the way. Even if the share price were to fall temporarily, ultimately, the market value were fall ultimately, it eliminates in the general public the question about the de-listing notice. So that was the overriding factor of where we are. So operator, we’ll move onto the next caller now. John, thanks for your questions.

Operator: Yes, sir. Your next question comes from George Walsh of Gilford Securities.

<Q — George Walsh>: Mark, could you speak to with eCOST in the mix the — what are you doing in order to drive the higher level margin business as part of the product mix that is sold in any particular quarter? Is there special marketing things you’re doing? Or is it just a matter of getting more product available on the site?

<A — Mark Layton>: There are two specific things. One we’ve added a — we’ve only been at it three weeks now, so we added a weekly HotSheet that’s just housewares and leisure store products only. That sheet has had good response rates to it, frankly has had as good of response rates as our technology and consumer electronics HotSheets have. Again, those are targeted to our existing customer base, but we still get about 20% of our responses from our daily email marketing being new customers. That’s the viral impact of the marketing that goes on. So it’s too early for us to have measurable results. We are now going — all of our houseware, For the Home and Leisure store advertising has just been done on Sunday the last three weeks. We’re going to try our first weekday HotSheet on that this week and measure the responses on it in contrast to a consumer electronics and technology HotSheet. So to our existing customer base is number one.

The second part of it is that because of the higher margin characteristics of these products, the hypothesis that we have and again, I don’t have enough data yet to prove this out, but my initial data and indication shows me that I can pay about three or four times the price to acquire a new customer via shopping comparison engines, for example, leading with a houseware product than I can leading with a technology product. And that has to do with the gross margin dollars involved in the sale and the gross margin dollars of the subsequent sale of the kind of buyer that you actually obtain or acquire through this. So with these higher margin characteristics, it opens up a number of the web marketing avenues that we have curtailed significantly over the last few years because we found we were acquiring unprofitable customers with technology props. So those are the two areas that we’re leading with right now.

The third one, which will expand in the coming months, will be in our affiliate marketing activity. There are a number of affiliate sites that focus on these types of products that were previously not interested and being an affiliate of eCOST because we were a technology and consumer electronics site. So we’ll circle back with our affiliate networks and begin to add affiliate relationships as well.

<Q — George Walsh>: Okay. But we should expect that price to acquire a customer to start ticking up from here?

<A — Mark Layton>: If we’re successful with this, yes, you’ll see the — you may see the price to acquire go up, but we should also see gross margin mix grow up as well. So they kind of go hand in hand. Right now, it’s small and it’s not measurable in either piece.

<Q — George Walsh>: Okay. So those won’t necessarily be concurrent to start out?