SOURCE: VMH VideoMovieHouse

March 07, 2006 09:40 ET

VMH VideoMovieHouse.com Signs 3-Year Contract With Webloyalty Inc.

VANCOUVER, BC -- (MARKET WIRE) -- March 7, 2006 -- VMH VideoMovieHouse.com (OTC BB: VMHVF) is pleased to announce the signing of a formal 3-year contract with Webloyalty Inc. The contract allows Webloyalty the opportunity to market its value-added services to all DVDmarketplace.com customers for a period of three years and will allow DVDmarketplace.com the opportunity to earn significant additional revenues from every transaction it facilitates. Webloyalty's value-added services will later be offered on VMH VideoMovieHouse.com-owned websites.

Ecommerce sites who partner with Webloyalty.com earn an extra $.50 to $2.00 per transaction on their Web sites and generate a lift of up to 12 percent in repeat transactions. They do so by rewarding their customers for purchases with a package of benefits, provided and fulfilled by Webloyalty, that strengthen their brand and give their customers a reason to return and buy again. VMH VideoMovieHouse.com has signed a deal that will contribute an estimated $1.30 in extra earnings from each and every sale transacted on a VMH VideoMovieHouse.com-owned website.

According to Steve Gaspar, President of VMH VideoMovieHouse.com, "Webloyalty is very selective on which companies they choose to market their services through, as evidenced by the impressive list of well-known companies that our company will be added to. Not only does this contract make every transaction potentially more profitable, but the fringe benefits that accompany the Webloyalty partnership include marketing tools which encourage customers to become repeat customers. Webloyalty will also expand our customer base through national offers and branding campaigns. These include customer vouchers to be spent on future purchases and exposure through Webloyalty's different marketing channels. I look forward to seeing the many rewards that will come with this partnership."

According to Brian Holden, Marketing Director for DVDmarketplace.com, "Our business model as a transaction facilitator relies on our ability to maximize each and every transaction. Currently, DVDmarketplace.com makes money by collecting a percentage of the sale plus a percentage of the shipping fee charged to customers. Now we have successfully put into place a third revenue stream which is a fee from the sale of Webloyalty's value-added services to the customer. This will greatly increase our revenue stream as well as add to DVDmarketplace's overall bottom line. DVDmarketplace.com will also see increased traffic as the result of Webloyalty's encouraged repeat business offers and national marketing programs. This will add greatly to DVDmarketplace's incremental sales growth."

About Webloyalty:

Founded in 1999, Webloyalty is one of the leading online marketing services companies providing customized programs to e-commerce, travel, and other fee-based businesses. Through its range of innovative products, Webloyalty helps its clients increase their revenues while offering its clients' customers a range of valuable benefits packages. Since its inception, Webloyalty has been dedicated to marketing responsibly by offering a new model of customer-friendly subscription services. Today, over 1.6 million subscribers enjoy savings from Webloyalty's services. Webloyalty has over 180 employees in its Norwalk, CT, headquarters and San Francisco offices. It has been profitable since FY2003, has announced FY05 revenues of $108.6 million dollars, and has achieved an extremely high compound annual growth rate of over 90% for the past three years.

In May 2005, Webloyalty announced a strategic transaction with General Atlantic LLC. General Atlantic is a leading global private equity firm providing capital for growth companies driven by information technology or intellectual property. Founded in 1980, General Atlantic has about $10 billion in capital under management. The firm has invested in over 150 companies and has current holdings in approximately 50 companies, including almost half based outside the United States. Webloyalty clients include American Greetings, Broderbund, Chadwick's, Classmates.com, Drugstore.com, EB Games.com, Lane Bryant Catalog, MovieTickets.com, PETCO, Priceline, The Learning Company, and United Online.

About VMH VideoMovieHouse.com:

VMH VideoMovieHouse.com (OTC BB: VMHVF) is an innovative online seller of DVDs worldwide currently operating websites under the www.dvdmarketplace.com and www.videomoviehouse.com banners. The company intends to concentrate its near-term expansion efforts toward the third-party e-merchant business, commencing with DVDs and expanding to other media products as opportunities present themselves. The company is planning a national advertising campaign rollout with aims of creating one of the world's largest interactive DVD Buyer/Seller communities, www.dvdmarketplace.com.

Safe Harbor Act Notice:

Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Technical complications that may arise could prevent the prompt implementation of any strategically significant plan(s) outlined above. The company cautions that these forward-looking statements are further qualified by other factors including, but not limited to those set forth in the company's Form 10-KSB filing and other filings with the United States Securities and Exchange Commission (available at http://www.sec.gov/). The company undertakes no obligation to publicly update or revise any statements in this release, whether as a result of new information, future events or otherwise.

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