Go Daddy 2015 Annual Report Download - page 155

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Table of Contents
27
Customer Care
Customer Care expense represents the costs to advise our customers and service their needs, primarily consisting of
personnel costs. We expect these expenses to increase in absolute dollars in the future as we expand our domestic and
international Customer Care teams due to increases in total customers. We expect Customer Care expenses to fluctuate as a
percentage of total revenue depending on the level of personnel required to support the continued growth of our business.
Year Ended December 31, 2015 to 2014 2014 to 2013
2015 2014 2013 $ change % change $ change % change
Customer care $ 221.5 $ 190.5 $ 150.9 $ 31.0 16% $ 39.6 26%
2015 compared to 2014. Customer care expenses increased $31.0 million, or 16.3%, from $190.5 million in 2014 to
$221.5 million in 2015. The increase was primarily due to a $28.5 million increase in compensation-related costs, primarily
driven by increased average headcount, as well as $2.5 million of incremental costs associated with the continued expansion of
our international third-party Customer Care locations.
2014 compared to 2013. Customer care expenses increased $39.6 million, or 26.2%, from $150.9 million in 2013 to
$190.5 million in 2014. The increase was primarily due to a $34.8 million increase in compensation-related costs primarily
attributable to an 11.5% increase in employee headcount, of which $5.8 million is related to our Media Temple business, as well
as $4.8 million of incremental costs associated with the expansion of our international third-party Customer Care locations.
General and administrative
General and administrative expenses primarily consist of personnel costs for our administrative functions, professional
service fees, office rent for all locations, all employee travel expenses, sponsor-based costs and other general costs. We expect
general and administrative expenses to increase in absolute dollars in the future as a result of our overall growth, increased
personnel costs and increased expenses associated with being a public company.
Year Ended December 31, 2015 to 2014 2014 to 2013
2015 2014 2013 $ change % change $ change % change
General and administrative $ 219.7 $ 172.0 $ 145.8 $ 47.7 28% $ 26.2 18%
2015 compared to 2014. In 2015, general and administrative expenses include $29.7 million of additional expenses related
to certain payments made following the completion of the IPO, including $26.7 million paid to the Sponsors in connection with
the termination of the transaction and monitoring fee agreement and $3.0 million paid to Bob Parsons in connection with the
termination of the executive chairman services agreement. Following these payments, we are no longer obligated to make
future payments under either of these agreements.
General and administrative expenses increased $47.7 million, or 27.7%, from $172.0 million in 2014 to $219.7 million in
2015. Excluding the termination payments discussed above, general and administrative expenses increased $18.0 million, or
10.5%, from $172.0 million in 2014 to $190.0 million in 2015, primarily due to an $11.3 million increase in legal and
professional fees resulting from the resolution of outstanding claims and a $7.0 million increase in compensation-related costs
driven by increased average headcount.
2014 compared to 2013. General and administrative expenses increased $26.2 million, or 18.0%, from $145.8 million in
2013 to $172.0 million in 2014. The increase was primarily due to a $25.4 million increase in compensation-related costs,
primarily driven by employee headcount increases during the second half of 2013 (including the addition of certain executives,
retention bonuses, $4.7 million related to our Media Temple business and an increase of $4.3 million in equity-based
compensation expense). The remaining increase was primarily due to a $7.7 million increase in travel and corporate functions
and a $6.6 million increase in office rent related to the expansion of our facilities, as well as increases in other general expenses
associated with the overall growth of our business. These increases were partially offset by a $13.8 million decrease related to
sales tax reserves primarily recorded in the fourth quarter of 2013 and a $5.4 million decrease in professional service fees
resulting primarily from a favorable settlement agreement reached in December 2014 with an insurance carrier.