Stamps.com 2007 Annual Report Download - page 13

described in the subheadings below as well as:
We may implement pricing plans and promotions that may adversely affect our future revenues and margins.
Our ability to generate gross margins depends upon the ability to generate significant revenues from a large base of active
customers. In order to attract customers in the future, we may run special promotions and offers such as trial periods, discounts
on fees, postage and supplies, and other promotions. In additional, we may offer new pricing plans for new and existing
customers. We cannot be sure that customers will be receptive to future fee structures and special promotions that we may
implement. Even though we have established a sizeable customer base, we still may not generate sufficient gross margins to
remain profitable. In addition, our ability to generate revenues or sustain profitability could be adversely affected by the special
promotions or additional changes to our pricing plans.
• The costs of our marketing programs to establish and promote our brands;
• The demand for our services and products;
• Our ability to develop and maintain strategic distribution relationships;
• The number, timing and significance of new products or services introduced by us and by our competitors;
• Our ability to develop, market and introduce new and enhanced products and services on a timely basis;
• The level of service and price competition;
• Our operating expenses;
• USPS regulation and policies relating to PC Postage and PhotoStamps; and
• General economic factors.
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If we do not successfully attract and retain skilled personnel for permanent management and other key personnel positions,
we may not be able to effectively implement our business plan.
Our success depends largely on the skills, experience and performance of the members of our senior management and other
key personnel. Any of these individuals can terminate his or her employment with us at any time. If we lose key employees and
are unable to replace them with qualified individuals, our business and operating results could be seriously harmed. In addition,
our future success will depend largely on our ability to continue attracting and retaining highly skilled personnel. As a result, we
may be unable to successfully attract, assimilate or retain qualified personnel. Further, we may be unable to retain the employees
we currently employ or attract additional qualified personnel to replace those key employees that may depart. The failure to
attract and retain the necessary personnel could seriously harm our business, financial condition and results of operations.
The success of our business will depend upon the continued acceptance by customers of our service.
We must minimize the rate of loss of existing customers while adding new customers. Customers cancel their subscription to
our service for many reasons, including a perception that they do not use the service sufficiently. Also customers may feel the
costs for service are too high, they may be going out of business, or they may have other issues that are not satisfactorily
resolved. We must continually add new customers both to replace customers who cancel and to continue to grow our business
beyond our current customer base. If too many of our customers cancel our service, or if we are unable to attract new customers
in numbers sufficient to grow our business, our operating results will be adversely affected. Further, if excessive numbers of
customers cancel our service, we may be required to incur significantly higher marketing expenditures than we currently
anticipate replacing these customers with new customers.
If we fail to effectively market and sell our services and products, our business will be substantially harmed and could fail.
In order to acquire customers and achieve widespread distribution and use of our services and products, we must develop and
execute cost-effective marketing campaigns and sales programs. We currently rely on a combination of marketing techniques to
attract new customers including direct mail, online marketing and business partnerships. We may be unable to continue
marketing our services and products in a cost-effective manner. If we fail to acquire customers in a cost-effective manner, our
results of operations will be adversely affected.