Vistaprint 2008 Annual Report Download - page 8

Market and Industry Background
The Marketplace for Small Business Marketing Products and Services
We focus on providing marketing products and services for the small business market, generally
businesses or organizations with fewer than 10 employees, and often with fewer than 2 employees.
We believe that there are approximately 50 million small businesses with fewer than 10 employees in
the United States, Canada, and the European Union and that that these small businesses undergo
frequent changes with many forming and dissolving each year, creating a large market for business
identity products and services in addition to marketing products and services. We also believe that, in
response to the growth of the Internet and the emergence of digital production technologies, small
businesses are shifting from traditional small business suppliers of customized marketing products and
media toward on-line alternatives.
In the past, a business seeking customized marketing products and services could either hire a
designer to develop and coordinate the production of marketing materials or produce printed materials
themselves using desktop software and an inkjet or laser printer. A designer can produce a
professionally coordinated portfolio of marketing products and services, but this is a significantly more
costly and time consuming alternative, whereas traditional self-service typically produces less
sophisticated and lower quality output. We believe that neither alternative is convenient or cost-
effective for small businesses, which typically lack the resources or skills to generate satisfactory
results using either approach.
Online commerce provides significant advantages and opportunities to small business customers
seeking customized marketing products and services at affordable prices. These customers do not
typically require the large quantities that are traditionally required to achieve low per-unit pricing and do
not maintain dedicated procurement departments to negotiate pricing effectively. We believe the high
price, inconvenience and complexity of traditionally procuring customized marketing products and
services have historically dissuaded small business customers from purchasing these products and
services. We believe that the highly fragmented, geographically dispersed nature of the small business
market makes it ideally suited for Internet-based procurement, as the Internet provides a standardized
interface through web browsers, availability seven days a week, 24 hours a day, the ability to offer a
wide selection of products and services, and the opportunity to efficiently aggregate individual orders
into larger and more efficient production units.
We believe that the small business market has been underserved by expensive traditional
marketing alternatives. Further, we believe that the sophistication of marketing efforts by larger
businesses demonstrates to small business owners the attractiveness of multi-format coordinated
marketing portfolios. We also believe there is a significant advantage to combining the Internet’s ability
to reach these highly fragmented markets with an integrated design and production process that can
rapidly deliver sophisticated, high quality marketing products and services. In addition, we believe that
coordinated portfolios of marketing products and services can help small businesses appear more
competent and professional, which can enhance their customer relationships and prospects for
success.
The Marketplace for Customized Consumer Products and Services
While we focus primarily on small business marketing products and services, many of our product
formats are also purchased by consumers seeking custom-produced announcements, greeting cards,
calendars, stationery, and personalized gifts. In the past, many such products were supplied by an
industry comprised of print manufacturing wholesalers and local retailers, such as stationery stores.
Compared with today’s Internet-based alternatives, the traditional offer was relatively limited, prices
were significantly higher, and delivery often required longer lead times. Graphic designs were limited
and it was rarely possible to incorporate full color photography into the design.
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