Vistaprint 2011 Annual Report Download - page 49

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The increase in our technology and development expenses of $15.2 million for fiscal 2011 as
compared to fiscal 2010 was primarily due to increased payroll and facility-related costs of $9.3 million
associated with increased headcount in our technology development and information technology
support organizations. At June 30, 2011, we employed 454 employees in these organizations
compared to 375 employees at June 30, 2010. In addition, during the fiscal year ended June 30,
2011, we continued to invest in our website infrastructure, which resulted in increased depreciation,
hosting services expense and other website related expenses of $5.8 million as compared to the
same periods in fiscal 2010. The increase in other website related expenses during fiscal 2011
includes the impact of a legal settlement of a patent claim, offset by expenses in the prior year related
to the abandonment of certain acquired intangible assets recorded in conjunction with the Soft Sight,
Inc. acquisition.
The increase in our technology and development expenses of $17.5 million for fiscal 2010 as
compared to fiscal 2009 was primarily due to increased payroll and benefit costs of $10.4 million
associated with increased headcount in our technology development and information technology
support organizations. At June 30, 2010, we employed 375 employees in these organizations
compared to 302 employees at June 30, 2009. In addition, to support our continued revenue growth
during this period, we continued to invest in our website infrastructure, which resulted in increased
depreciation and hosting services expense of $2.4 million, increased third-party consulting services of
$0.8 million, and increased other expenses of $3.0 million for fiscal 2010 as compared to fiscal 2009.
Fiscal 2010 included $0.9 million of expense related to certain acquired intangibles recorded in
conjunction with the Soft Sight acquisition that were determined not to have an economic use for
Vistaprint and were abandoned.
Marketing and selling expense
Marketing and selling expense consists primarily of advertising and promotional costs; payroll
and related expenses for our employees engaged in marketing, sales, customer support and public
relations activities; and third-party payment processing fees.
The increase in our marketing and selling expenses of $55.3 million for fiscal 2011 as
compared to fiscal 2010 was driven primarily by increases of $41.9 million in advertising costs and
commissions related to new customer acquisition and costs of promotions targeted at our existing
customer base, and increases in payroll and facility-related costs of $11.4 million. We continued to
expand our marketing organization and our customer service, sales and design support centers and
at June 30, 2011, we employed 1,017 employees in these organizations compared to 806 employees
at June 30, 2010. In addition, payment processing fees paid to third parties increased by $3.2 million
during fiscal 2011, as compared to fiscal 2010 due primarily to increased order volumes. These
increases were partially offset by a charge of $1.5 million related to indirect taxes that is included in
the fiscal year ended June 30, 2010.
The increase in our marketing and selling expenses of $57.4 million for fiscal 2010 as
compared to fiscal 2009 was driven primarily by increases of $39.5 million in advertising costs and
commissions related to new customer acquisition and costs of promotions targeted at our existing
customer base, and increases in payroll and benefits related costs of $12.9 million. During this period,
we continued to expand our marketing organization and our customer service, sales and design
support centers including the addition of our facilities in Berlin, Germany and Tunis, Tunisia. At
June 30, 2010, we employed 806 employees in these organizations compared to 609 employees at
June 30, 2009. In addition, payment processing fees paid to third-parties increased by $2.8 million
during fiscal 2010, as compared to fiscal 2009 due to increased order volumes.
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