FTD.com 2011 Annual Report Download - page 77

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Table of Contents
The decrease in Content & Media revenues was partially due to a decrease in services revenues. Services revenues decreased, despite a 2%
increase in our average number of pay accounts for the year ended December 31, 2010 compared to the year ended December 31, 2009, as a
result of a 13% decrease in ARPU for the year ended December 31, 2010 compared to the year ended December 31, 2009. The decrease in
ARPU was primarily attributable to a greater percentage of total pay accounts being represented by domestic discounted pricing plans and lower-
priced international subscription plans. In addition, Content & Media advertising revenues decreased by $16.5 million for the year ended
December 31, 2010, compared to the year ended December 31, 2009, primarily due to minimal revenues generated from post-
transaction sales in
the year ended December 31, 2010, partially offset by an increase in revenues generated from our online loyalty marketing service.
Content & Media Cost of Revenues
The increase in Content & Media cost of revenues was primarily due to a $1.5 million increase in the cost of points earned by members of
our online loyalty marketing service and a $0.7 million increase in overhead-related costs, partially offset by a $1.3 million decrease in credit
card processing fees and a $0.4 million decrease in personnel-related costs. The increase in cost of revenues as a percentage of Content & Media
revenues was primarily due to significantly lower revenues from post-transaction sales, which have minimal cost of revenues.
Content & Media Sales and Marketing
The decrease in Content & Media sales and marketing expenses was largely the result of an $11.8 million decrease in marketing costs to
acquire new online nostalgia services members and a $2.2 million decrease in personnel- and overhead-related costs as a result of reduced
headcount, partially offset by a $1.4 million increase in costs to acquire online loyalty marketing members and other sales and marketing costs.
74
Year Ended
December 31, Change
2010
2009
$
%
(in thousands, except percentages)
Content & Media cost of revenues
$
35,514
$
35,014
$
500
1
%
Content & Media cost of revenues as a percentage of
Content & Media revenues
17.6
%
14.8
%
Year Ended
December 31,
Change
2010
2009
$
%
(in thousands, except percentages)
Content & Media sales and marketing
$
62,226
$
74,819
$
(12,593
)
(17
)%
Content & Media sales and marketing expenses as a
percentage of Content & Media revenues
30.9
%
31.7
%