Enom 2014 Annual Report Download - page 40

Download and view the complete annual report

Please find page 40 of the 2014 Enom annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

37
The following table sets forth additional performance highlights of key business metrics for the periods presented:
Year ended December 31, % Change
2014
2013
2012
2014 to 2013 2013 to 2012
Content & Media Metrics(1):
Visits (in thousands) .................................... 4,004,287 4,031,514 3,861,223 -1% 4%
RPV ............................................................. $ 34.22 $ 48.39 $ 53.78 -29% -10%
Marketplaces Metrics(1):
Number of Transactions .............................. 715,343 277,442 - 158% N/A
Average Revenue per Transaction ............... $ 49.47 $ 51.65 $ - -4% N/A
(1) For a discussion of these period-to-period changes in the number of visits, RPV, number of transactions and average revenue per
transaction and how they impacted our financial results, see “Results of Operations” below.
Basis of Presentation
Revenue
Our revenue is derived from sales of advertising and from products and services sold through our online marketplaces and other
offerings.
Service Revenue
Content & Media
We generate Content & Media service revenue primarily from advertisements displayed alongside our content on our online
properties and certain of our customers’ online properties. Articles, videos and other forms of content generate advertising revenue
from a diverse mix of advertising methods including performance-based cost-per-click advertising, in which an advertiser pays only
when a visitor clicks on an advertisement; display advertisements, where revenue is dependent upon the number of advertising
impressions delivered; and sponsored content or advertising links. Where we enter into revenue-sharing arrangements with our
customers, such as those relating to our advertiser network, and when we are considered the primary obligor, we report the underlying
revenue on a gross basis in our consolidated statements of operations, and record these revenue-sharing payments to our customers in
service costs.
We also generate Content & Media service revenue from the sale or license of media content, including the creation and
distribution of content for third-party brands and publishers through our Content Solutions service. In circumstances where we
distribute our content on third-party properties and the customer acts as the primary obligor we recognize revenue on a net basis. In
addition, we have previously generated Content & Media service revenue through social media services from recurring management
support fees, overage fees in excess of standard usage terms, outside consulting fees and initial set-up fees. As of February 2015, we
no longer provide social media services.
Marketplaces
We generate service revenue from commissions we receive from facilitating the sale of original art by artists to customers
through Saatchi Art. We recognize service revenue arising from the sale of original art net of amounts paid to the artist because we are
not the primary obligor in the transaction, we do not have inventory risk, and we do not establish the prices for the art sold. We also
recognize this service revenue net of any sales allowances. Revenue is recognized after the original art has been delivered and the
return period has expired. Payments received in advance of delivery and completion of the return period are included in deferred
revenue in the accompanying consolidated balance sheets. We periodically provide incentive offers to customers to encourage
purchases, including percentage discounts off current purchases, free shipping and other offers. Value-added taxes (“VAT”), sales and
other taxes are not included in Marketplaces service revenue because we are a pass-through conduit for collecting and remitting any
such taxes.