Enom 2015 Annual Report Download - page 18

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16
some of our competitors react more quickly as the industry evolves, focus more on product innovation, and devote
substantially more resources to website and system development than we do. Some of our competitors may offer or
continue to offer faster and/or free shipping, more favorable return policies or other transaction-related services which
improve their user experience, but which could be impractical or inefficient for us to match. Some of our competitors
may be able to use the advantages of brick-and-mortar stores or other sorts of physical presence to build their customer
bases and drive sales. Our competitors may engage in more extensive research and development efforts, undertake more
far-reaching marketing campaigns and adopt more aggressive pricing policies, which may allow them to build larger
customer bases or generate net sales from their customer bases more effectively than we do. For all of these reasons, we
may not be able to compete successfully against the current and potential competitors to our artist marketplaces.
We rely on freelance artists to generate the artwork and designs sold through our art and design marketplaces. We
may not be able to attract or retain enough artists to generate artwork and designs on a scale or of a quality sufficient
to grow our business.
Our art and design marketplaces rely on artists to join our communities and contribute original artwork and
designs that they seek to sell or monetize through the sale of art prints and other print-on-demand products. We rely on
freelance artists to upload their unique art designs to Society6 or sell their original artwork on Saatchi Art and we may
not be able to attract or retain enough artists to generate artwork and designs on a scale or of a quality sufficient to grow
our business. Furthermore, our competitors may attempt to attract members of our artist communities by offering
compensation and revenue-sharing arrangements that we are unable to match. If we are unable to continue attracting
artists to our marketplaces, our revenues from sales of artwork and print-on-demand products will decrease, which
would have a negative impact on our business, financial condition and results of operations.
We may not be successful in expanding our current product or service offerings, or expanding into new lines of
business, which could limit our future growth.
Important potential areas of growth for us are the development of new product and service offerings and the
acquisition or internal development of new lines of business, and we are currently developing certain niche media
properties and mobile applications. New product and service offerings and new lines of business may be subject to
significant business, economic and competitive uncertainties and contingencies frequently encountered by new
businesses in competitive environments, many of which are beyond our control, including lack of market acceptance. If
we develop or acquire new lines of business or new product or service offerings, we may not be able to effectively
integrate and manage these new businesses and we may not recover the funds and resources we expend on developing or
acquiring them. If we are unable to successfully expand the products and services we offer, or expand into new lines of
business, our future growth would be limited which could have a negative effect on our business, financial condition and
results of operations.
Poor perception of our brands or business could harm our reputation and adversely affect our business, financial
condition and results of operations.
Our Content & Media business is dependent on attracting a large number of visitors to our online properties and
providing leads and clicks to our advertisers, which depends in part on our reputation within the industry and with our
users. Perception that the quality of our content may not be the same or better than that of other published Internet
content, even if baseless, can damage our reputation. In addition, Livestrong.com is a licensed trademark from the
Livestrong Foundation and there has been negative publicity surrounding Mr. Armstrong. Any damage to our reputation
could harm our ability to attract and retain advertisers, visitors, customers and artists, which would materially adversely
affect our business, financial condition and results of operations.
We depend upon the quality of traffic to our online properties to provide value to online advertisers and excessive
low-quality traffic could have a material adverse effect on the value of such online properties to our third-party
advertisement distribution providers and online advertisers and thereby adversely affect our revenue.
We depend upon the quality of traffic to our online properties to provide value to online advertisers. Low-quality
traffic can include clicks associated with non-human processes, including robots, spiders or other software; the