Stamps.com 2010 Annual Report Download - page 11

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TABLE OF CONTENTS
In 2011 we plan to continue investing in our shipping technology and sales and marketing efforts by (1) continuing to
improve the software features to further improve scalability of the product to the largest high-volume customers, (2)
adding shopping cart integration for easier data export and import from the tools that customers like to use, (3) adding
new integrations into sophisticated high-volume shipping solutions such as multi-carrier shipping software, and (4)
scaling our sales effort using our national sales force. Attracting high volume shippers is a strategic focus for us and is
also one of the most important strategic initiatives of the USPS. We are focused on helping the USPS as much as we can
to be successful in this area.
Our PhotoStamps Business
In 2011 we plan to continue marketing PhotoStamps, but with limited spending and expectations. We will continue our
program of focused direct-to-website PhotoStamps marketing spending with a goal of keeping the overall cost per acquisition at
a level that provides an attractive financial return. We do not expect to invest heavily in the PhotoStamps area long-term until the
economy materially improves, as we believe that there will be opportunities to grow the business in a better economic
environment.
Competition
The market for our products is competitive. Some of our current direct competitors in the PC Postage and Customized
Postage categories include:
Endicia.com/Dymo. Endicia is a group within Newell Rubbermaid’s Office Products division that offers a software-based
PC Postage service similar to our PC Postage service under the brand name Endicia, a custom postage offering similar to our
PhotoStamps service under the brand name PictureItPostage, and a NetStamps-like service in conjunction with Dymo (an
affiliated company also owned by Newell Rubbermaid) under the brand names Dymo Stamps and Dymo Printable Postage. All
three of these services are directly competitive with our own services in these areas.
Dymo Stamps is different from our service in the approach it takes to the business model. Its service is offered without a
monthly service fee, which is one of its primary marketing messages versus our service. To use the Dymo Stamps feature,
however, customers must purchase Dymo Stamps labels through Endicia at a price that is significantly higher per label than our
price for our NetStamps labels.
Pitney Bowes, Inc. Pitney Bowes is the current market leader in the U.S. traditional postage meter business, with revenues
of $5.4 billion in 2010. Pitney Bowes launched its initial software-based PC Postage product in 2000 and currently offers a PC
Postage product named ShipStream Manager designed for shipping packages. During 2004 Pitney Bowes also began offering an
Internet-based service for printing a single label for use in shipping a package that does not require a monthly subscription fee, in
partnership with eBay. Pitney Bowes offers a customized postage offering (branded ZazzleStamps) through a partnership with
Zazzle.com, Inc., a small, private U.S. company that specializes in custom products. During 2010 Pitney Bowes launched a PC
Postage solution named pbSmartPostage.
We also compete with traditional postage meters offered by Pitney Bowes and others in the U.S. market. We believe that our
customers choose our PC Postage service over traditional postage meters primarily to save money. We also believe that our PC
Postage service can offer superior capabilities to postage meters in certain
reporting tool with real time data, improved web-based postage management tools, and enhanced web-based financial
and administrative controls for central decision makers, which are typically not available with a postage meter. In 2011,
we plan to continue increasing and optimizing our enterprise customer lead generation efforts. We also plan to increase
our sales team size commensurate with the business prospects that are available and continue working on improving the
efficiency of our sales team.
•
Enhance our High Volume Shipper Solution and Marketing Efforts.
In 2010 we made several enhancements to our
shipping technology, including: (1) improved batch capability with easier order management, easier order flow, the
ability to customize email and the ability to print packing slips, (2) additional shopping cart integrations for easier data
export and import from the tools that customers like to use, and (3) a partnership with Amazon.com that makes our
domestic and international shipping labels available to Amazon.com Marketplace users.
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