Vistaprint 2008 Annual Report Download - page 26

increased use of the Internet for commerce and other technical advances have allowed traditional
providers of these products and services to improve the quality of their offerings, produce those
products and deliver those services more efficiently and reach a broader purchasing public. Current
and potential competitors include:
‰self-service desktop design and publishing using a combination of (1) software such as
Microsoft Publisher, Microsoft Word and Broderbund PrintShop; (2) desktop printers or copiers
and (3) specialty paper supplies;
‰traditional printing and graphic design companies;
‰providers of technologies, such as websites, e-mail and electronic files, which may act as a
substitute for printed materials;
‰office supplies and photocopy companies such as Office Depot, FedEx Office, and Staples;
‰wholesale printers such as Taylor Corporation and Business Cards Tomorrow International;
‰online apparel suppliers such as CaféPress, Lids, and Zazzle;
‰website design and hosting companies such as United Internet, Microsoft, Yahoo!, Godaddy,
Intuit, Web.com, and 1&1; and
‰other online printing and graphic design companies.
Many of our current and potential competitors have advantages over us, including longer
operating histories, greater brand recognition, existing customer and supplier relationships, and
significantly greater financial, marketing and other resources. Many of our competitors work together.
For example, Taylor Corporation sells printed products through office superstores such as Staples and
Office Depot.
Some of our competitors who either already have an online presence or are seeking to establish
an online presence may be able to devote substantially more resources to website and systems
development than we can. In addition, larger, more established and better capitalized entities may
acquire, invest or partner with traditional and online competitors as use of the Internet and other online
services increases. Competitors may also seek to develop new products, technologies or capabilities
that could render many of the products, services and content we offer obsolete or less competitive,
which could harm our business and results of operations.
In addition, we have in the past and may in the future choose to collaborate with certain of our
existing and potential competitors in strategic partnerships that we believe will improve our competitive
position and results of operations, such as through a retail in-store or web-based collaborative offering.
It is possible, however, that such ventures will be unsuccessful and our competitive position and results
of operations will be adversely affected as a result of such collaboration.
Our failure to meet our customers’ price expectations would adversely affect our business and
results of operations.
Demand for our products and services has been sensitive to price. Changes in our pricing
strategies have had, and may continue to have, a significant impact on our revenues and net income.
We offer certain free products and services as a means of attracting customers and we offer
substantial pricing discounts as a means of encouraging repeat purchases. Such free offers and
discounts may not result in an increase in revenues or the optimization of profits. In addition, many
factors, including our production and personnel costs and our competitors’ pricing and marketing
strategies, can significantly impact our pricing strategies. If we fail to meet our customers’ price
expectations in any given period, our business and results of operations will suffer.
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