Vistaprint 2013 Annual Report Download - page 13

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electronically with numerous shipping carriers, selecting an optimum mix of carriers while assuring smooth tracking
and information flow to the customer until final confirmation of delivery.
Requiring as little as 13 seconds of pre-press, printing, cutting and boxing labor for a typical order of 250
business cards, versus an hour or more for traditional printers, this process enables us to print many high quality
customized orders using a fraction of the labor of typical traditional printers. Our quality control systems are
designed around the principles of world-class manufacturing to ensure that we consistently deliver high quality
products.
Supply Chain Management
We are focused on achieving the lowest total cost of ownership in our strategic sourcing efforts by
concentrating on quality, logistics, technology and cost. Our efforts include the procurement of high quality materials
and equipment that meet our strict specifications at a low total cost across a growing number of geographic
manufacturing locations. Additionally, we work to develop and implement logistics, warehousing, and outbound
shipping strategies to provide a balance of low-cost material availability while limiting our inventory exposure. We
believe investing in a strategic supply chain management capability that is tightly integrated with our other
manufacturing teams helps us improve efficiency and reduce costs.
Our Competitive Advantage: Direct Marketing Expertise
We have developed expertise in direct marketing to target new customers across various channels and to
drive more traffic to our websites, as well as to retain existing customers. Our marketing centers in Australia, India,
Spain and the United States execute focused marketing strategies to each region but leverage our global
organization in terms of expertise, knowledge sharing, and marketing best practices.
To acquire new customers, we employ sophisticated direct marketing approaches leveraging digital media
and technologies as well as traditional media such as direct mail and broadcast. We also acquire customers
through channels such as organic search and direct URL type-in. In addition, many of the products that we offer our
customers contain the Vistaprint logo and reference our website. Our products, by their nature, are purchased by
our customers for the purpose of being further distributed to business or personal contacts. Our customer base is
an important marketing asset, providing beneficial word-of-mouth advertising and brand visibility through online and
offline business forums. We have also run television broadcast campaigns in the United States and have tested this
channel in other markets. We utilize both mobile and social media platforms to promote our brand and engage with
our customers. Over the years, our offers have evolved as e-commerce norms have evolved. Historically, our lead
acquisition offer was free business cards with optional fee-based attributes. More recently, we have been
successful leading with a low all-in offer price (for example, 250 business cards for $10 including shipping).
We have developed tools and techniques for measuring the efficiency of each marketing partner and
product or service placement. In addition, our split-run testing technology allows us to divide prospective or
returning customers visiting our websites into sub-groups that are presented with different product and service
selections, prices and/or marketing messages. This allows us to test or introduce new products and services on a
limited basis, test various price points on products and services or test different marketing messages related to
product or service offerings. Our testing engine allows us to run hundreds of these tests simultaneously on our
websites, reducing the time to take an idea from concept to full deployment and allowing us to quickly identify and
roll-out the most promising and profitable ideas and promotions to maximize our long-term customer value
proposition.
We advertise on the websites of companies such as eBay and Amazon, contract for targeted e-mail
marketing services from vendors such as MyPoints, and contract for placement on leading search engines such as
Google, Bing, and Yahoo!. We maintain affiliate programs with companies which permit program partners to include
hyperlinks to our websites from their sites and include our site address in promotional materials.
Competition
The markets for small business marketing products and services and home and family custom products,
including the printing and graphic design market, are intensely competitive, highly fragmented and geographically
dispersed, with many existing and potential competitors. We compete on the basis of breadth of product offerings,
price, convenience, quality, design content, design options and tools, customer and design services, ease of use,