Go Daddy 2015 Annual Report Download - page 31

Table of Contents
We rely on search engines to attract a meaningful portion of our customers. If search engines change their search algorithms or policies regarding
advertising, increase their pricing or suffer problems, our ability to attract new customers may be impaired.
Many of our customers locate our website and products through Internet search engines such as Google, Yahoo! and Bing. The prominence of our website in
response to search inquiries is a critical factor in attracting potential customers to our websites. If we are listed less prominently or fail to appear in search results
for any reason, visits to our websites by customers and potential customers could decline significantly, and we may not be able to replace this traffic. Search
engines revise their algorithms from time to time in an attempt to optimize their search results. If search engines on which we rely for algorithmic listings modify
their algorithms, our websites may appear less prominently or not at all in search results, which could result in reduced traffic to our websites. Additionally, if the
costs of search engine marketing services, such as Google AdWords, increase, we may incur additional marketing expenses or be required to allocate a larger
portion of our marketing spend to this channel and our business and operating results could be adversely affected.
Furthermore, competitors may in the future bid on our brand names and other search terms we use to drive traffic to our websites. Such actions could increase
our advertising costs and result in decreased traffic to our websites. In addition, search engines or social networking sites may change their advertising policies
from time to time. If any change to these policies delays or prevents us from advertising through these channels, it could result in reduced traffic to our website and
sales of our subscriptions.
If we are unable to increase sales of our products to Web Pros, our business, growth prospects and operating results will be adversely affected.
Historically, our business has been focused on serving individuals who are thinking about starting a business to small businesses and ventures that are up and
running but need help growing and expanding their digital capabilities. As a result, our products were less suited to the needs of more technically skilled
individuals or web developers and other Web Pros. Furthermore, we did not target Web Pros with our marketing activities or provide Customer Care resources
tailored to this customer group. We continue to focus on Web Pros in order to increase our total customers and grow our revenue. In October 2013 , we acquired
Media Temple, a premium provider of web-hosting and other premium products specifically geared towards Web Pros. We are also working to tailor our
marketing efforts to, and build dedicated Customer Care resources for, Web Pros. If we are unable to develop products and provide Customer Care addressing the
needs of Web Pros, successfully target them with our marketing efforts or successfully leverage the Media Temple brand to capture a greater portion of the Web
Pros market, our business, growth prospects and operating results could be adversely affected.
We maintain a network of different types of partners, some of which create integrations with our products. For example, we partnered with Microsoft
Corporation to offer Office 365 email and other productivity tools to our customers and SiteLock, LLC (SiteLock) to offer website security products to our
customers, and we have worked to make certain of our products interoperable with services such as Yelp. We have invested and will continue to invest in partner
programs to provide new product offerings to our customers and help us attract additional customers. However, our relationships with our partners may not be as
successful in generating new customers as we anticipate, which could adversely affect our ability to increase our total customers. Further, these programs could
require substantial investment while providing no assurance of return or incremental revenue. We also rely on some of our partners to create integrations with
third-party applications and platforms used by our customers, such as Office 365 and SiteLock. If our partners fail to create such integrations, or if they change the
features of their applications or alter the terms governing use of their applications in an adverse manner, demand for our products could decrease, which would
harm our business and operating results. If we are unable to maintain our contractual relationships with existing partners or establish new contractual relationships
with potential partners, we may not be able to offer the products and related functionality our customers expect, and we may experience delays and increased costs
in adding customers and may lose customers, which could have a material adverse effect on us. Any ineffectiveness of our partner programs could adversely affect
our business and results of operations.
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