Strama - Hare, Casey

Running head: GODADDY, INC.
Ateneo de Manila Graduate School of Business
A Strategic Management Paper on GoDaddy, Inc.
Submitted to:
Professor Leveric T. Ng, DBA
In partial fulfillment of course requirements for TSSTRAMA
Submitted by:
Casey Clayton Hare, PHR
AGSB Clark – MBA Regis Program
R180002
Initially Submitted:
October 21, 2021

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Table of Contents
List of Figures ............................................................................................................... 6

List of Tables ................................................................................................................. 7
Executive Summary ...................................................................................................... 9
1. Introduction......................................................................................................... 11
1.1 Company Background ..................................................................................... 11
1.2 Products and Services ...................................................................................... 12
1.2.1 Domains ...................................................................................................... 12
1.2.2 Software as a Service (SaaS) ...................................................................... 14
1.2.2.1 Hosting and Presence ........................................................................... 15
1.2.2.2 Business Applications .......................................................................... 16
1.3 Current revenues.............................................................................................. 17
1.4 Markets Served ................................................................................................ 17
2. Research Design and Methodology ........................................................................ 18
2.1 Internal Data .................................................................................................... 18
2.2 External Data ................................................................................................... 18
2.3 Field Interviews ................................................................................................ 19
2.4 Methodology ..................................................................................................... 19
2.5 Limitation of Study .......................................................................................... 21
3. Company Vision and Mission ................................................................................. 22
3.1 Company Vision Statement ............................................................................. 22
3.1.1 Evaluation of Existing Vision Statement .................................................... 22
3.1.2 Revised Vision Statement ........................................................................... 23
3.1.3 Evaluation of Revised Vision Statement..................................................... 24
3.2 Company Mission Statement .......................................................................... 24
3.2.1 Evaluation of Existing Mission Statement.................................................. 24
3.2.2 Revised Mission Statement ......................................................................... 26
3.2.3 Evaluation of Revised Mission Statement .................................................. 26
4. External Analysis .................................................................................................... 28
4.1 General Environment ...................................................................................... 28
4.1.1 Economic Forces ......................................................................................... 28
4.1.1.1 OPPORTUNITY: Growth of global e-commerce industry .................. 28
4.1.1.2 OPPORTUNITY: Growth of global web-hosting industry .................. 30
4.1.2 Government, Political, and Legal Forces .................................................... 30
4.1.2.1 THREAT: Increasingly strict data privacy regulations ........................ 30
4.1.2.2 THREAT: International differences in VAT/sales taxes ....................... 31
4.1.3 Technological Forces .................................................................................. 32
4.1.3.1 OPPORTUNITY: Cost of cloud infrastructure .................................... 32
4.1.3.2 OPPORTUNITY: E-commerce technology constantly improving ...... 33
4.1.3.3 THREAT: Cybersecurity ...................................................................... 34
4.1.4 Social, Cultural, Demographic, and Environmental Forces ....................... 34
4.1.4.1 THREAT: Customers prefer to shop on larger e-marketplaces............ 35
4.2 Industry and Competitor Analysis ................................................................. 35
4.2.1 Industry and Market Analysis ..................................................................... 36
4.2.1.1 Products and Services .......................................................................... 36
4.2.1.2 Price ..................................................................................................... 37
4.2.1.3 Promotion............................................................................................. 37
4.2.1.4 Distribution Channels .......................................................................... 37
4.2.1.5 Market Share Analysis ......................................................................... 38
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4.2.1.6 Growth Rate and Stage in Growth Cycle ............................................. 40

4.2.1.7 Market Size and Customer Profile ....................................................... 41
4.2.1.8 Factors Affecting Cost of Doing Business ........................................... 42
4.2.2 Porter’s Five Forces of Competition Model ............................................... 42
4.2.2.1 Threat of New Entrants ........................................................................ 43
4.2.2.2 Bargaining Power of Suppliers ............................................................ 44
4.2.2.3 Bargaining Power of Buyers ................................................................ 45
4.2.2.4 Threat of Substitutes ............................................................................ 46
4.2.2.5 Rivalry of Competition ........................................................................ 47
4.2.2.6 Rating the Attractiveness of the Industry ............................................. 48
4.2.3 Key Competitor Profiles ............................................................................. 49
4.2.3.1 THREAT: Competition from fellow SaaS platform providers ............ 49
4.2.3.2 Shopify ................................................................................................. 49
4.2.3.3 Wix ....................................................................................................... 51
4.2.3.4 SquareSpace ......................................................................................... 52
4.2.3.5 BigCommerce ...................................................................................... 53
4.2.3.6 THREAT: Competition from open-source (free) software packages ... 54
4.2.3.7 WordPress/WooCommerce .................................................................. 55
4.2.4 Competitive Profile Matrix ......................................................................... 58
4.2.4.1 Brand Recognition (E-Commerce) ...................................................... 59
4.2.4.2 E-Commerce Capabilities .................................................................... 60
4.2.4.3 Security and Reliability........................................................................ 62
4.2.4.4 Additional SaaS Business Tools ........................................................... 63
4.2.4.5 Price/Value ........................................................................................... 64
4.2.4.6 Customer Service and Support............................................................. 66
4.2.4.7 International Reach .............................................................................. 67
4.2.4.8 Conclusion ........................................................................................... 68
4.3 External Factor Evaluation (EFE) Matrix .................................................... 68
4.3.1 Opportunity Ratings .................................................................................... 69
4.3.1.1 Growth of global e-commerce industry ............................................... 69
4.3.1.2 Growth of global web-hosting industry ............................................... 70
4.3.1.3 Cost of cloud infrastructure ................................................................. 70
4.3.1.4 Customers preferring to shop on larger e-marketplaces ...................... 70
4.3.1.5 Technology to streamline e-commerce constantly improving ............. 71
4.3.2 Threat Ratings ............................................................................................. 71
4.3.2.1 Competition from fellow SaaS platform providers .............................. 71
4.3.2.2 Competition from open-source software packages .............................. 71
4.3.2.3 Cybersecurity ....................................................................................... 72
4.3.2.4 Increasingly strict data privacy regulations ......................................... 72
4.3.2.5 International differences in VAT/sales taxes ........................................ 73
4.3.3 Evaluation of Total Weighted Score ........................................................... 73
5. Internal Analysis ..................................................................................................... 73
5.1 Organizational Diagnosis ................................................................................ 73
5.1.1 Management Audit ...................................................................................... 74
5.1.1.1 STRENGTH: Satisfied and diverse employee base............................. 75
5.1.1.2 STRENGTH: Corporate focus on e-commerce ................................... 76
5.1.2 Marketing Audit .......................................................................................... 77
5.1.2.1 STRENGTH: Cost-effectiveness/price of products offered ................ 79
5.1.2.2 WEAKNESS: Promoting brand in e-commerce context ..................... 79
5.1.3 Finance Audit .............................................................................................. 81
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5.1.3.1 Horizontal Analysis.............................................................................. 82

5.1.3.2 Tax Receivable Agreement (TRA) ....................................................... 85
5.1.3.3 Vertical Analysis .................................................................................. 88
5.1.3.4 Financial Ratios Compared with Shopify and Wix.............................. 92
5.1.4 Operations Audit ......................................................................................... 98
5.1.4.1 STRENGTH: Additional SaaS business tool set available .................. 98
5.1.4.2 STRENGTH: Quality of customer service and support ...................... 99
5.1.4.3 WEAKNESS: Capabilities of proprietary product stack ................... 100
5.1.4.4 WEAKNESS: Global reach of in-house e-commerce payments ....... 101
5.1.5 Research & Development Audit ............................................................... 102
5.1.6 Management Information Systems Audit ................................................. 102
5.1.7 Value Chain Analysis ................................................................................ 104
5.1.8 Porter’s Generic Strategies Analysis ......................................................... 106
5.1.8.1 WEAKNESS: Split focus between in-house products and managed
open-source ................................................................................................................ 107
5.2 Internal Factor Evaluation (IFE) Matrix .................................................... 108
5.2.1 – IFE Analysis/Conclusion ....................................................................... 109
6. Strategy Formulation ............................................................................................ 109
6.1 Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix ............... 109
6.1.1 S-O Strategies ........................................................................................... 111
6.1.1.1 Promote “all-in-one” online business package (S1-O1-O2) .............. 111
6.1.1.2 Offer discounts on hosting plans based on GMV (S2-O1-O2) .......... 111
6.1.1.3 Promote marketplace integration assistance (S3-S4-O4) .................. 111
6.1.1.4 Pursue more acquisitions of e-commerce technology (S5-O5) ......... 112
6.1.1.5 Increase hiring efforts for e-commerce specialists (S4-S5-O5) ......... 112
6.1.2 S-T Strategies ............................................................................................ 112
6.1.2.1 Counter-advertising against Shopify (S1-T1) .................................... 112
6.1.2.2 Continue integration of open-source tools (S5-T2) ........................... 112
6.1.2.3 Create expanded Security Team (S3-S4-T3) ..................................... 113
6.1.2.4 Leverage international workforce for VAT compliance (S4-T5) ....... 113
6.1.3 W-O Strategies .......................................................................................... 113
6.1.3.1 Focus all marketing on e-commerce (W1-O1) .................................. 113
6.1.3.2 Divert more of R&D budget to proprietary tech stack (W2-O5) ....... 113
6.1.3.3 Push users from WordPress to Store Builder (W3-O1-O5) ............... 114
6.1.3.4 Increase payment partnerships with global marketplaces (W4-O4) .. 114
6.1.4 W-T Strategies........................................................................................... 114
6.1.4.1 Research buying smaller competitors (W1-W2-T1) .......................... 114
6.1.4.2 Use acquisitions to add to tech stack (W3-T2) .................................. 115
6.1.4.3 Pursue partnership/acquisition of payment processors (W4-T5) ....... 115
6.1.5 SWOT/TOWS Recommendation Summary ............................................. 115
6.2 Strategic Position and Action Evaluation (SPACE) Matrix ....................... 115
6.3 Boston Consulting Group (BCG) Matrix .................................................... 117
6.4 Internal-External (IE) Matrix ...................................................................... 119
6.5 Grand Strategy Matrix (GSM) ..................................................................... 120
6.6 Summary of Recommended Strategies ........................................................ 121
6.7 Quantitative Strategic Planning Matrix (QSPM) ....................................... 122
7. Objectives and Strategy Recommendations ......................................................... 125
7.1 Strategic and Financial Objectives ............................................................... 125
7.1.1 Key Strategic Issues .................................................................................. 125
7.1.2 Strategic Objective .................................................................................... 126
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7.1.3 Financial Objective ................................................................................... 126

7.2 Recommended Strategies .............................................................................. 127
7.2.1 Market Penetration Strategies ................................................................... 127
7.2.1.1 Promote “all-in-one” online business package .................................. 127
7.2.1.2 Discounts on plans based on GMV.................................................... 129
7.2.1.3 Leverage GoDaddy Guides as “Store Concierges” ........................... 130
7.2.1.4 Leverage GoDaddy Guides as “Migration Experts” .......................... 132
7.2.1.5 Focus Marketing/Advertising 100% on E-commerce........................ 133
7.2.1.6 Increase adoption of GoDaddy Payments on open-source platforms 134
7.2.2 Horizontal Integration Strategies .............................................................. 136
7.2.2.1 Acquire smaller companies in E-commerce space............................. 136
7.2.2.2 Partnerships with competitors ............................................................ 137
7.2.3 Forward Integration Strategies .................................................................. 138
7.2.3.1 Acquire payment processing companies ............................................ 138
7.2.3.2 Partnerships with international e-marketplaces/e-wallets .................. 140
7.2.4 Product Development Strategies ............................................................... 140
7.2.4.1 Continued commitment to R&D to grow in-house tech .................... 141
7.2.4.2 Look for open-source software with permissive licenses to modify . 142
8. Strategy Implementation ....................................................................................... 143
8.1 Strategy Map .................................................................................................. 143
8.2 Action Plans and Programs ........................................................................... 143
8.2.1 Management Presentation and Messaging Cascade ................................. 143
8.2.2 Detailed Business Strategies Action Plans ................................................ 144
8.3 Financial Projections ..................................................................................... 149
8.3.1 List of Assumptions .................................................................................. 149
8.3.2 Projected Balance Sheet ............................................................................ 152
8.3.3 Projected Income Statement ..................................................................... 155
8.3.4 Projected Cash Flow Statement ................................................................ 157
8.3.5 Projected Growth Rate and Market Share Changes .................................. 159
8.3.6 Projected Financial Ratios ........................................................................ 163
9. Strategy Evaluation, Monitoring, and Control .................................................... 164
9.1 Balanced Scorecard ....................................................................................... 164
9.1.1 Financial Perspective ................................................................................ 165
9.1.1.1 To grow market share ......................................................................... 165
9.1.2 Customer Perspective................................................................................ 165
9.1.2.1 Compelling value proposition for all-in-one e-commerce solution ... 165
9.1.2.2 Maintain customer satisfaction .......................................................... 166
9.1.2.3 Increase total number of e-commerce customers............................... 166
9.1.3 Internal Business Processes Perspective ................................................... 167
9.1.3.1 Focus advertising on e-commerce ..................................................... 167
9.1.3.2 Increase technology base and reach ................................................... 168
9.1.4 Learning and Growth Perspective ............................................................. 169
9.1.4.1 Internal awareness of importance of e-commerce ............................. 169
9.1.4.2 Specialized internal training for monetized services ......................... 169
9.2 Business Continuity and Risk Management Plan ....................................... 170
References ................................................................................................................. 173
Appendices................................................................................................................. 181
Appendix A. Glossary of Terms and Abbreviations .......................................... 181
Appendix B. Financial Statements for GoDaddy, Inc., 2018-2020 .................. 184
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List of Figures
Figure 1 - GoDaddy Logo ........................................................................................................ 11
Figure 2 - Old GoDaddy Logo (until 2020) ............................................................................. 11
Figure 3 - Domain name in relation to URL Internet address ................................................. 12
Figure 4 - GoDaddy Marketing for Online Store Builder........................................................ 15
Figure 5 - Global E-Commerce Sales (2019-2024) ................................................................. 29
Figure 6 - High-Level Customer Roadmap for E-Commerce (Young, et al., 2021) ............... 36
Figure 7 - Customer Profile & TAM for SaaS E-Commerce (Young, et al., 2021) ................. 42
Figure 8 - Porter's Five Forces Analysis for SaaS E-Commerce Industry ............................... 48
Figure 9 - Shopify Logo........................................................................................................... 50
Figure 10 - Wix.com Logo ....................................................................................................... 51
Figure 11 - SquareSpace Logo ................................................................................................. 53
Figure 12 - BigCommerce Logo .............................................................................................. 53
Figure 13 - WordPress Logo .................................................................................................... 56
Figure 14 - WooCommerce Logo ............................................................................................ 56
Figure 15 - Google Trends for [company] + "e-commerce" .................................................... 59
Figure 16 – Detailed Customer Roadmap for E-Commerce Merchants (Young, et al., 2021) 63
Figure 17 - Estimated E-commerce sales by country for 2021 (Oberlo) ................................. 68
Figure 18 - Main header of GoDaddy.com - October 2021 ..................................................... 77
Figure 19 - Spokespeople for GoDaddy "Make a Different Future" Campaign ...................... 80
Figure 20 - TRAs as a percentage of overall US IPOs, 2003-2017 (Shobe, 2018) ................. 86
Figure 21 - GDDY Stock Price Movements Related to TRA Settlement ................................ 88
Figure 22 - GoDaddy, Inc. Unlevered Free Cash Flow, 2016-2020 ........................................ 92
Figure 23 - Porter's Value Chain Analysis Adapted for Service Industry .............................. 104
Figure 24 - Porter's Generic Strategies (from David and David [2017]) ............................... 107
Figure 25 - Graphical Representation of SPACE Matrix ....................................................... 116
Figure 26 - Boston Consulting Group (BCG) Matrix Visual Representation ........................ 118
Figure 27 - Internal-External (I-E) Matrix Visual Representation ......................................... 119
Figure 28 - Grand Strategy Matrix......................................................................................... 120
Figure 29 - WordPress.com Quick Start Session - Philippines .............................................. 131
Figure 30 - Danica Patrick NASCAR race car with GoDaddy logos .................................... 133
Figure 31 - Historical and Projected Ad Spend for GoDaddy 2018-2024 (in $ mil) ............. 134
Figure 32 - Download stats and ratings for Poynt @ WordPress.org plugin market ............. 135
Figure 33 - Companies purchased by GoDaddy, Inc. in 2020 ............................................... 136
Figure 34 – Historical/Projected Revenue and R&D Costs ($millions) - 2018-2024 ........... 141
Figure 35 - Strategy Map for GoDaddy, Inc. ......................................................................... 143
Figure 36 - EY 2022 Growth Projections - Organic vs Strategies ......................................... 160
Figure 39 - Market Share and Growth Rate Changes 2022-2024 .......................................... 162
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List of Tables
Table 1 - List of GoDaddy Domain Products and Services ..................................................... 13
Table 2 - Summary of Frameworks, Activities, and Outputs ................................................... 20
Table 3 - Top Five Domain Registrars by Relative Market Share ........................................... 21
Table 4 - Evaluation of Current Vision Statement ................................................................... 22
Table 5 - Evaluation of Revised Vision Statement .................................................................. 24
Table 6 - Evaluation of Current Mission Statement................................................................. 25
Table 7 - Evaluation of Revised Mission Statement ................................................................ 26
Table 8 - Relative Market Share for Top Five SaaS E-Commerce Platform Providers ........... 39
Table 9 - CAGR for Top 5 SaaS E-Commerce Firms, 2018-2021 (in $millions).................... 40
Table 10 - Competitive Profile Matrix - SaaS E-Commerce Industry ..................................... 58
Table 11 - Comparison of E-Commerce Plan Monthly Subscription Prices ........................... 65
Table 12 - Weighted Customer Satisfaction Ratings (TrustPilot) ............................................ 67
Table 13 - External Forces Evaluation (EFE) Matrix .............................................................. 69
Table 14 - Management Audit for GoDaddy, Inc..................................................................... 74
Table 15 - GoDaddy, Inc. Diversity-Related Awards, 2019-2021 ........................................... 76
Table 16 - Marketing Audit for GoDaddy, Inc. ........................................................................ 77
Table 17 - Finance Audit for GoDaddy, Inc. ............................................................................ 81
Table 18 - Balance Sheet Horizontal Analysis ......................................................................... 82
Table 19 - Income Statement Horizontal Analysis .................................................................. 84
Table 20 - Balance Sheet Vertical Analysis ............................................................................. 88
Table 21 - Income Statement Vertical Analysis ....................................................................... 90
Table 22 – Historical Liquidity Ratios for Top 3 Competitors ................................................ 92
Table 23 - Historical Leverage Ratios for Top 3 Competitors ................................................. 93
Table 24 - Historical Profitability Ratios for Top 3 Competitors ............................................ 94
Table 25 - Historical Growth Ratios for Top 3 Competitors.................................................... 96
Table 26 - Historical Activity Ratios for Top 3 Competitors ................................................... 97
Table 27 - Operations Audit for GoDaddy, Inc. ....................................................................... 98
Table 28 - Research & Development Audit for GoDaddy, Inc. ............................................. 102
Table 29 - Management Information Systems Audit for GoDaddy, Inc. ............................... 102
Table 30 - Value Chain Analysis Details for GoDaddy, Inc................................................... 105
Table 31 - Internal Factor Evaluation (IFE) Matrix ............................................................... 108
Table 32 - SWOT/TOWS Matrix ........................................................................................... 110
Table 33 - SPACE Matrix Variable Values............................................................................. 116
Table 34 - Boston Consulting Group (BCG) Matrix Calculations ........................................ 117
Table 35 - Summary of Recommended Strategies ................................................................. 121
Table 36 - Categories Recommended for QSPM ................................................................... 123
Table 37 - Quantitative Strategic Planning Matrix (QSPM) .................................................. 123
Table 38 - Comparison of A-la-Carte vs All-in-One hosting plan pricing ............................. 128
Table 39 - Popular Global Payment Systems ......................................................................... 139
Table 40 - Senior Management Action Plan .......................................................................... 143
Table 41 - Market Penetration #1 and 2 ................................................................................. 144
Table 42 - Market Penetration #3 and 4 ................................................................................. 145
Table 43 - Market Penetration #5........................................................................................... 146
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Table 44 - Market Penetration #6 and Product Development #2 ........................................... 147

Table 45 - Horizontal Integration #1 and Forward Integration #1 ......................................... 148
Table 46 - Horizontal Integration #2 and Forward Integration #2 ......................................... 148
Table 47 - Product Development #1 ...................................................................................... 149
Table 48 - List of Financial Assumptions for Projections...................................................... 149
Table 49 - Balance Sheet Projection - Horizontal Analysis ................................................... 152
Table 50 - Balance Sheet Projection - Vertical Analysis ........................................................ 153
Table 51 - Income Statement Projection - Horizontal Analysis ............................................. 155
Table 52 - Income Statement Projection - Vertical Analysis ................................................. 156
Table 53 - Cash Flow Statement Projection ........................................................................... 157
Table 54 - EY 2022 Growth Projections (in $millions) ......................................................... 160
Table 57 - Changes in Market Share and CAGR 2022-2024................................................. 162
Table 58 - Select Projected Financial Ratios 2022-2024 ....................................................... 163
Table 59 - Balanced Scorecard for GoDaddy, Inc. ................................................................ 164
Table 60 - Business Continuity Plan Based on Risk Factors ................................................. 171
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Executive Summary
This Strategic Management paper describes the current status of and recommended
strategies for GoDaddy, Inc., a multi-national Internet-based business headquartered in
Phoenix, Arizona, United States. GoDaddy, Inc. (“GoDaddy”) is the world leader in domain
name registration and management on the Internet (revenues of $1.515 billion in 2020), and
is currently the number two provider of Software-as-a-Service E-Commerce solutions
globally (revenues of $1.802 billion in 2020), excluding the People’s Republic of China.
Using frameworks described by David and David (2017), this paper elucidates
GoDaddy’s current business structure and position by evaluating its current vision and
mission statements, analyzing the external environments in which GoDaddy operates
(Internet e-commerce, web hosting, and SaaS business applications), identifying and
comparing GoDaddy’s position relative to its nearest competitors in the market, and
reviewing and critiquing the current internal structure, processes, and financial performance
of GoDaddy. This paper then formulates strategy recommendations using established
strategic analysis tools, identifies specific financial and strategic objectives for GoDaddy for
the next three years, and recommends targeted initiatives, action plans, and performance
measurement metrics to achieve said objectives. Financial and market share projections for
the next three years and business continuity/risk management plans are presented to show the
predicted effect of the strategies on GoDaddy’s future financial and market position and
provide contingencies in case of unforeseen or disastrous events.
Among the key observations noted was the high growth of the e-commerce industry
as a whole, and the SaaS e-commerce platform industry specifically, which now contributes
more than half of GoDaddy’s revenue, overshadowing its traditional Domain vertical. The
company has begun to shift to publicly focus on primarily supporting small businesses
through e-commerce, but specific weaknesses were noted in its results, notably its slower
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growth compared to main competitors in the SaaS e-commerce space, Shopify, Inc. and Wix,
Inc. Shopify surpassed GoDaddy in SaaS e-commerce revenue in 2020 and is projected to
have more than double GoDaddy’s revenue in this space by the end of 2021. Weaknesses in
GoDaddy’s current methods include a fractured product line, an unclear marketing strategy,
and recent acquisitions that do not necessarily support the company’s stated goals.
Given a 33% historical CAGR for the combined top five SaaS e-commerce platforms
2018-2021 compared to only a 12% CAGR for GoDaddy in the same period, aggressive
Market Penetration and other strategies are recommended in this paper for GoDaddy to begin
to reclaim market share from its competitors.
This paper projects a combined CAGR of 26% for the top five SaaS e-commerce
platforms (including GoDaddy) for 2022-2024, slightly lower than 2018-2021 due to the
potential subsiding of the COVID-19 pandemic and a small shift back to brick-and-mortar
retail businesses. Within this combined industry CAGR, GoDaddy’s aggressive strategies to
reclaim market share project an individual CAGR of 38%, allowing it to show a +5.03%
increase in market share by 2024 with a SaaS e-commerce revenue target of $4.742 billion
and total revenue of $7.357 billion (including the Domain vertical). While other competitors
will continue to grow as well, GoDaddy’s strategies are projected to have the effect of
slowing their growth (the smaller competitors slowed more effectively than Shopify);
GoDaddy will remain in the number two position for the foreseeable future, but should be
able to become the only platform with increasing relative market share by 2024, which will
guarantee its continued performance and profitability as a company.

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1. Introduction
Figure 1 - GoDaddy Logo
1.1 Company Background
GoDaddy, Inc. was founded in 1997 by Bob Parsons, an entrepreneur who had
previously made his fortune by creating and selling a financial management software
platform, MoneyCounts, for US $64 million to Intuit, the largest tax software provider in the
United States(Intuit, Inc., 1996). The original name for GoDaddy, Inc. was Jomax
Technologies, named after a dirt road near Parsons’ home in Phoenix, Arizona. In 1999, the
staff of the company decided to change the name to something more “catchy.” After first
suggesting “BigDaddy” but finding out the name was already taken, the company decided on
“GoDaddy” and continued to build that brand since (Parsons, 2004).
While originally envisioned as a website creation/software company, GoDaddy took
advantage of the opening of the domain name market in the late 1990s/early 2000s, when
ICANN (the Internet Corporation for Assigned Names and Numbers) was established to
administer and register companies managing domain names, breaking the previous monopoly
held by Network Solutions and the US government (Catania, 2020). In 2000, GoDaddy
become accredited by ICANN to be a domain name registrar, and by 2005 had become the
largest registrar in the world (Westerdal, 2005), a position it still maintains today.
Figure 2 - Old GoDaddy Logo (until 2020)

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Over the last twenty years, GoDaddy, Inc. has expanded its core business to include
business tools for website owners, domain security and expanded registration options, as well
as the launch of website creation and marketing tools in 2017. Throughout the 2000s
GoDaddy was known for its extensive and racy advertising campaigns across US television,
especially the US Super Bowl, and had a reputation for being sexist. However, with the
naming of Blake Irving as the new CEO and Elissa Murphy as the new CTO of GoDaddy in
2012, GoDaddy shifted to being focused on equality, diversity, as well as expanding their
product base to supporting business owners across the internet (Metz, 2015). GoDaddy
became a public company with its Initial Public Offering (IPO) on the New York Stock
Exchange using the ticker symbol GDDY in 2015. They have since maintained their position
as the number one domain registrar in the world, expanded their business to the international
market, and have become one of the world leaders in website hosting, e-commerce solutions,
and business support for online businesses.
1.2 Products and Services
1.2.1 Domains
GoDaddy’s original growth product, and what created its brand awareness and value
in the Internet market, is the registration and management of domain names, or an Internet
address purchased and registered to a person or company attached to a Top Level Domain
(TLD) such as .com, .org, .net, or .ph.
Figure 3 - Domain name in relation to URL Internet address

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GoDaddy currently acts as a registrar for over 240 TLDs, which means customers can
purchase their domain names using these TLDs based on availability, and manage their
domain by linking it to a website address, either hosted by GoDaddy or elsewhere on the
Internet. These domain names are usually originally owned by different registries (for
example, Verisign owns the rights to .com after obtaining it from Network Solutions in the
early 2000s), but are “re-sold” and managed through registrars such as GoDaddy.
In 2020, GoDaddy also became a registry for certain domain names, in which they
own/operate an entire TLD and allow registrar companies to re-sell the names on their
markets and manage them. GoDaddy is currently the registry for TLDs including the
endings .co, .us, .biz, .nyc, .club, and .loan (Allemann, 2020).
Domain names typically have a registration period of one year, at which point they
need to have their registration “renewed” by the customer. If the domain name is not renewed
immediately, it can be bought by a different person or organization (often known as “site
squatters”) and re-sold. Domains can also be sold by current owners to a third party, known
as the domain “aftermarket” (GoDaddy, Inc., 2021).
Products and services within the Domain vertical of GoDaddy, Inc., include the
following listed in the table below:
Table 1 - List of GoDaddy Domain Products and Services
Product or Service Description

Search for Domain Free service allowing customers to search for availability of a
domain name (if it is available for registration or already
owned)
Purchase Domain Customers can purchase a specific domain name on up to 240

different TLDs for different prices (1 to 2 year registration)
Renew Domain Customers can pay to continue their domain registration

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Product or Service Description

Transfer Domain Customers can transfer domain ownership to a third-party, or
transfer the management of their domain from one registrar to
another (i.e., to or from GoDaddy, Inc.)
Protect Domain Optional premium services to prevent a third party from

registering domain during renewal period, to hide/anonymize
ownership of domain in public WHOIS registries, and
additional security to help prevent hacking/cyberattacks
Domain Auctions Customers who wish to sell ownership of domain names can
put them up for auction to the highest bidder, with GoDaddy
acting as marketplace/escrow to ensure payment and transfer
Premium DNS Access to GoDaddy’s DNS network to increase uptime and

availability of customers’ websites attached to domain if they
are self-hosting or using a non-GoDaddy website hosting
service
As of 2021, with over 900 domain registrars accredited with ICANN on the Internet,
GoDaddy alone is the registrar of record for over 22% of all 371 million domain names
registered worldwide and is by far the market leader in domain registration and reselling. The
Domain vertical provided 46% of GoDaddy, Inc.’s overall revenue in 2020 (GoDaddy, Inc.,
2021).
1.2.2 Software as a Service (SaaS)
The second half of GoDaddy’s business centers around providing Software as a
Service (SaaS) products to its customers. SaaS is the product of the Internet age – instead of
downloading and running a piece of software on a customer’s own computer, SaaS products
are cloud-based; the customer must be connected to the Internet in order to use the software.
This provides many advantages to both the customer and the software provider; the customer
can save storage and processing power on their own computers, while the company can
provide seamless and instant product upgrades, as well as collect more revenue by offering
the SaaS products on a subscription model, rather than a one-time price for offline software,
which was the norm before broadband Internet service became ubiquitous (Turner, 2019).
GODADDY, INC. 15
GoDaddy’s SaaS products provided 54% of the company’s revenue in 2020. The
vertical is currently split into two different categories, Hosting and Presence, and Business
Applications.
1.2.2.1 Hosting and Presence
Figure 4 - GoDaddy Marketing for Online Store Builder
GoDaddy has become one of the world leaders in website hosting for customers all
around the world, with 19 million paying customers in 2019 (GoDaddy, Inc., 2020).
GoDaddy offers website hosting in a large number of different configurations, from a simple
setup designed for people with little to no technical knowledge, to advanced configurations
designed for consumers who have either extensive technical knowledge, or companies who
have large internal tech teams who can manage hosting providers that can provide more
power and options.
While GoDaddy’s products are available to anyone who wants to “create a website,”
there are hundreds of free options on the Internet for people who want to create a blog or
personal website. Therefore, GoDaddy’s marketing is targeted towards customers who want
to create a website for business on the Internet, also known as e-commerce. GoDaddy offers
many different options for customers who wish to create an e-commerce site, from its own
proprietary Store Builder product, to customized marketing and social media solutions
(collectively known internally as Websites + Marketing), as well as a Managed WordPress
option, allowing customers to set up their online business using the open-source WordPress
GODADDY, INC. 16
Content Management System (CMS), while paying for GoDaddy’s infrastructure, bandwidth,
technical support, and proprietary plugins.
GoDaddy has also entered the e-commerce payments space, which is a growing
business sector of the e-commerce industry, where customers use a company’s product to
process their own customers’ payments online (via credit card, bank transfer, or other
financial system). GoDaddy has its own proprietary payments system, GoDaddy Payments,
that it uses in its Store Builder Product as the primary payment system as well as a plugin
available on WordPress (both on and off of GoDaddy hosting). In September 2021, GoDaddy
also launched a physical point-of-sale (POS) product for merchants to process payments in
person, using their online GoDaddy Payments account (FinExtra, 2021). Hosting and
Presence SaaS products centered around e-commerce provided 36% of GoDaddy’s revenue in
2020.
Additional addons to Hosting and Presence options include premium website security,
performance scans and activity analysis, remote updates of content, and content creation
assistance.
1.2.2.2 Business Applications
Related to Hosting and Presence solutions, GoDaddy also offers SaaS e-commerce
products collected in a category known as Business Applications. These services, while
provided by GoDaddy, also use partners and other providers to actually deliver the service,
while the billing and revenue stays primarily with GoDaddy. These services include domain-
connected productivity suite subscriptions (for example, to Microsoft Office 365); dedicated
e-mail service plans; e-mail marketing solutions (for example, connections to MailChimp or
MailPoet); telephony solutions, where customers can get a unique telephone number
connected to their website and usable on a mobile phone or VOIP hardware; and other
customizable solutions for businesses on request (including bespoke website design). These
GODADDY, INC. 17
services, which can be added on to most GoDaddy hosting plans, provided 18% of
GoDaddy’s revenue in 2020.
1.3 Current revenues
GoDaddy, Inc. has been cash flow positive since 2001, reached $100 million in
revenue in 2005, $500 million in 2009, $1 billion in 2013, and $3 billion in 2018. On its 2020
Annual Report, GoDaddy, Inc. reported US $3.317 billion in total revenue across both
verticals, Domains and SaaS, with $1.802 billion (or 54% as previously noted) coming from
SaaS web hosting tailored for e-commerce, which is the primary focus of this Strategic
Management paper. Before tax adjustments, GoDaddy, Inc. also had a positive operating
income of $272.2 million in 2020, with a healthy operating margin of 8.207% (GoDaddy,
Inc., 2021).
1.4 Markets Served
For most of its history, GoDaddy has focused on the United States market, as it was
the largest market for internet business and domain names for much of the early history of the
World Wide Web. While domain names were available to be registered worldwide,
GoDaddy’s marketing and support were entirely targeted to the American market until 2012,
when it launched its first localized market in India, providing local Indian-language support,
targeted Indian marketing, and products tailored to the Indian customer (Bapna, 2021). By
2016, GoDaddy had localized solutions in 56 different markets around the world, including
the Philippines, and its products are now available and used in over 125 different countries
(GoDaddy, Inc., 2021).
While GoDaddy’s products and services are available to anyone, from individual
consumer to corporate customers, the company primarily targets individuals and small
businesses for both of its verticals (domains and SaaS) in its marketing and advertising.
GODADDY, INC. 18
2. Research Design and Methodology
To determine the critical success factors and optimal forward strategies for
GoDaddy’s SaaS e-commerce business, this paper utilized multiple sources of data to gain a
comprehensive picture of the industry and its important players. Both qualitative and
quantitative research tools were used throughout this paper to develop critical analyses of
GoDaddy’s previous, current, and projected future performance, reflected against its
competitors and the overall performance of the e-commerce industry.
2.1 Internal Data
Primary data for this paper comes from internal sources of the companies analyzed
within. This includes annual and quarterly financial and performance reports of GoDaddy,
Inc. and its main competitors/partners in the SaaS e-commerce space, including Shopify,
Wix, SquareSpace, and BigCommerce; as well as annual reports from its much smaller
competitors in the domain vertical, including Tucows, NameCheap, Network Solutions, and
Public Domain Registry. Automattic, Inc., which owns WordPress and WooCommerce, open-
source web hosting and e-commerce platforms that simultaneously partner with and compete
against GoDaddy’s products, is a privately held company and does not disclose financial data
or other inside information. However, this researcher, as an employee of Automattic, Inc.,
was able to provide certain internal data without breaching confidentiality agreements around
WordPress and WooCommerce distribution and usage across the Internet. Internal data also
includes any Terms of Service agreements, billing contracts, product information, press
releases, or other operational announcements published by the above companies.
2.2 External Data
External data, both qualitative and quantitative, was also used extensively throughout
this paper to develop analyses and support strategies. This includes (but is not limited to)
detailed financial analysis reports from Barclays Group, Ltd.; other various financial reports
GODADDY, INC. 19
and analyses available publicly, including from the US Securities and Exchange Commission
(SEC); market research studies conducted on the growth of the e-commerce industry and
modern consumer preferences; case studies on different aspects of the e-commerce industry
(shipping, fulfillment, payments) published by various firms; academic dissertations
concerning specific tax agreements made by GoDaddy during its Initial Public Offering
(IPO); amalgamated customer support ratings from third-party ratings providers; and
reference materials concerning open-source initiatives, copyright law, international tax law,
data privacy laws, and cross-border shipping regulations.
Specific tools for internal company analysis, external market analysis, and strategy
formulation, analysis, implementation, evaluation, monitoring, and control used the 16th
(Global) Edition of Strategic Management: A Competitive Advantage Approach, Concepts
and Cases by David and David.
2.3 Field Interviews
As the e-commerce industry is, by its very nature, distributed across the world, there
is little opportunity or logic behind visiting actual office sites in researching this topic.
However, this researcher, due to their current employment and access to the industry, was
able to access discussions between certain companies in the industry regarding current
competitive factors and the predicted growth vectors of the industry, as well as a personal
interview with Paul Maiorana, the CEO of WooCommerce (Automattic, Inc.’s open-source e-
commerce platform) to gain more insight into the current needs of customers and the future
of e-commerce.
2.4 Methodology
This paper uses multiple analytical tools to determine proposed strategies for
GoDaddy. Traditional financial tools are used to analyze historical financial statements
(including balance sheets, cash flows, and statements of income), discuss the current financial
GODADDY, INC. 20
position of the company, and help develop future financial objectives based on projections.
To develop and propose the vision, mission, and strategies offered in this paper to meet said
objectives, this researcher used a collection of analytical and strategic frameworks commonly
used in strategic management, as collected and explained in the David and David work
referenced above:
Table 2 - Summary of Frameworks, Activities, and Outputs
Framework and Tools Activities Output

Parameters of a Vision Formulation of Vision Vision Statement
Statement (David) Statement
Essential Components of a Formulation of Mission Mission Statement

Mission Statement (David) Statement
External Forces Evaluation Environmental Analysis External Opportunities and

(EFE) Matrix (political, economic, social, Threats/Company Response
technological,
environmental, and legal)
Five Forces of Competition Industry Analysis Attractiveness of Industry

(Porter)
Competitive Profile Matrix Comparative evaluation and Competitiveness score of

(CPM) ranking of company and company and competitors
selected competitors using
critical success factors
David’s Functional Analysis Assessment of Functional Linkages to IFE ratings and

Areas of Company company response
Internal Factor Evaluation Internal Company Analysis Internal strengths and

(IFE) Matrix weaknesses of company and
company response to each
Strategy Formulation Tools Strategy Formulation and Recommended strategies for

(David): SWOT Matrix, Prioritization company to meet
Internal-External (I-E) financial/strategic objectives
Matrix, SPACE Matrix,
BCG Matrix, Grand Strategy
Matrix, and QSPM
Balanced Scorecard (Norton Strategy Implementation, Targets and Performance

and Kaplan) Evaluation, and Control measures for selected
strategic and operational
goals
GODADDY, INC. 21
2.5 Limitation of Study
This paper focuses on strategies for GoDaddy to compete against competitors in the
“SaaS e-commerce” industry, which in 2020 accounts for 54% of the company’s revenue.
This paper does not propose strategies to address GoDaddy’s performance in the domain
registration and management industry; although it provides 46% of GoDaddy’s revenue in
2020, GoDaddy has already mastered that particular market, with 80.24% of total relative
market share amongst the top five companies in the industry (GoDaddy, Inc., 2021).
Table 3 - Top Five Domain Registrars by Relative Market Share
Rank Company FY20 Domain Total # of Domains Relative Market

Revenue Share in Top 5
1 GoDaddy $1.515 billion 76.2 million 80.24%
2 Tucows $206 million 11.9 million 10.91%
3 NameCheap $109 million 12.6 million 5.78%
4 Network Solutions $53 million 7.5 million 2.81%
5 Public Domain Registry $5 million 6.3 million 2.65%
Over 900 domain registrars accredited by ICANN – Top 5 control 32% of total domains on the Internet
(Preusler, 2020).
This high performance, combined with the fact that GoDaddy’s competitors in the
domain and SaaS e-commerce industries are completely different, led this researcher to focus
solely on the SaaS e-commerce vertical of GoDaddy, as that market is growing the most
rapidly due to the Covid-19 pandemic and improvements in technology. GoDaddy has the
greatest potential to grow revenue and profit within this vertical over the next three years.
This focus also aligns with GoDaddy’s current stated strategic vision and mission, as well as
the revised vision and mission proposed in this paper.
This paper can also not accurately forecast the entry of a new, “paradigm-shifting”
product within the e-commerce market that may seriously affect all current players. While
this is discussed in the Business Continuity Plan/Risk Management section of this paper,
these risks are not based on reliable data, but rather potential possibilities.
GODADDY, INC. 22
Information on the actual financial performance of each company discussed in this
paper is limited to published financial statements filed legally with the US Securities and
Exchange Commission. Analysis of this performance (whether directly in this paper or
through other analyses referenced herein) are guided by the assumption that these filed,
audited statements are true and accurate representations of the company’s performance during
a particular fiscal year. Financial performance in Fiscal Year 2021 for all companies
referenced in this paper is based on SEC filings for the first six months (January to June
2021) and projections based on historical data and trends for the second six months (July to
December 2021), as published SEC filings were only available through Q2 2021 at the time
this paper was written.
3. Company Vision and Mission
3.1 Company Vision Statement
The current vision statement of GoDaddy, Inc. is as follows:
“Our vision is to radically shift the global economy toward independent
entrepreneurial ventures” (GoDaddy, Inc., 2021).
3.1.1 Evaluation of Existing Vision Statement
Using documented criteria to determine whether a vision statement is useful and
relevant to a company (David & David, 2017), the following is an evaluation of GoDaddy’s
current vision statement:
Table 4 - Evaluation of Current Vision Statement
Evaluation Criteria Result Remarks

1. Does it clearly answer NO The vision says how they want the
what the company wants to economy to shift, but not how or what
become? the company itself will do in that regard
– it is not specific about what the
company will become.
GODADDY, INC. 23

2. Is it aspirational? NO In terms of aspiration for the overall
global economy, it could be considered
aspirational, but it is unclear how that is
related to the company itself.
3. Is it concise enough, yet YES It is concise, and inspirational in the

inspirational? sense of what the company wants to do,
but not what the company will do to
achieve that goal.
4. Does it give a clear NO There is no target date or measure of

indication as to when it how much the economy should be
should be attained? “radically shifted.”
Upon evaluation, it is clear that the current vision statement of GoDaddy, Inc. is
vague, unclear, and not sufficient according to the guidelines of David and David, and
requires revision in order to meet those criteria and help guide the company towards strategic
objectives.
3.1.2 Revised Vision Statement
In revising the vision statement for GoDaddy, Inc., the above evaluation factors were
considered, as well as the current position of GoDaddy in the market, the relative status of its
nearest competitors, and the prospects for growth in the near future. The proposed revised
vision statement is as follows:
“To become the premier all-in-one SaaS web platform for solo entrepreneurs and
small to medium e-commerce enterprises by 2024.”
In the language of this vision statement, the word premier refers to the company in the
industry with the most growth in market share by percentage in 2024, and not overall market
share; with the current growth rates and market shares of GoDaddy and its nearest
competitors in the SaaS e-commerce market, there is no reasonably possible path for
GoDaddy to claim the number one spot in market share, or to lose their current spot as the
GODADDY, INC. 24
number two provider by 2024; however, they do have the potential to be able to slow the
growth of other firms in the market and reclaim previously lost market share.
3.1.3 Evaluation of Revised Vision Statement
Table 5 - Evaluation of Revised Vision Statement

1. Does it clearly answer YES The vision keeps the original feeling of
what the company wants to wanting to empower entrepreneurs, but
become? grounds it in what the company wants to
become in order to accomplish that
grander purpose.
2. Is it aspirational? YES It sets a tangible target of being the

premier provider of SaaS services for all
different types of small businesses, from
individual entrepreneurs to
small/medium business enterprises.
3. Is it concise enough, yet YES It is both concise and inspirational for

inspirational? the company by giving it a target to
reach for over the next three years of
operation.
4. Does it give a clear YES The vision gives a clear target for 2024
indication as to when it as to when GoDaddy should be the
should be attained? premier provider in the market.
3.2 Company Mission Statement
GoDaddy, Inc.’s current mission statement is as follows:
“Our mission is to empower entrepreneurs everywhere, making opportunity more
inclusive for all (Fazackarley, 2020).”
3.2.1 Evaluation of Existing Mission Statement
While GoDaddy’s own publications tout the mission statement as “bold and inspiring”
(Fazackarley, 2020), it should still be evaluated for effectiveness using commonly accepted
management parameters, such as the ones used by David and David. The current mission
statement is evaluated as follows, using the nine parameters set by David, et al. (2014) as
GODADDY, INC. 25
well as the additional parameter of how the mission takes into account nation-building from a
local, nation-based perspective (Ateneo de Manila University Graduate School of Business,
2020):
Table 6 - Evaluation of Current Mission Statement
Parameter Result Explanation

1. Customer YES Empowering entrepreneurs shows a
focus on the customer.
2. Products & Services NO Mission does not clarify what

GoDaddy’s products and services are
that can empower entrepreneurs.
3. Markets YES Target market is entrepreneurs,

although it does not clarify where, or
what type of entrepreneurs.
4. Technology NO No mention of technology in the

mission statement.
5. Concern for survival, NO Alludes to making opportunity

growth, & profitability inclusive, but not how that can enable
the survival or growth of GoDaddy as
a company.
6. Philosophy YES GoDaddy does want to empower

entrepreneurs through its business, so
its philosophy is clear.
7. Self-concept NO No mention of who GoDaddy is or

how they can achieve their goals.
8. Public image NO Nothing is reflected in the mission

statement on how GoDaddy is seen by
the public, only vague goals.
9. Concern for employees NO No mention of employees made in

current mission statement.
10. Nation-building NO No mention of nation-building made

in current mission statement.
GODADDY, INC. 26
3.2.2 Revised Mission Statement
Considering the David & David parameters, nation-building, and by analyzing the
current products, services, and business operations of GoDaddy, Inc., a revised mission
statement is proposed as follows, with references to the different parameters noted by
numbering:
“We create comprehensive and state-of-the-art (4) web solutions (2) for solo
entrepreneurs and SMEs all over the world (1,3), enabling them to build and grow their
online business presence (6). We provide a full stack of proprietary services unique to the
industry using our status as the world’s leading domain registrar (7). Our commitment to
diversity (9) and localized support (8) empowers our multi-national and multi-lingual
workforce to provide world-class service to anyone, regardless of background (10),
maximizing value for both customers and shareholders (5).”
3.2.3 Evaluation of Revised Mission Statement
The parameter references and explanations as to how the David & David parameters
are covered in the revised mission statement are discussed in the following table:
Table 7 - Evaluation of Revised Mission Statement

1. Customer YES Solo entrepreneurs and SMEs all over
the world refers directly to the
customer base GoDaddy markets to.
2. Products & Services YES Web solutions encompasses all of

GoDaddy’s various products, from
domain services, hosting, and e-
commerce products.
3. Markets YES GoDaddy is a global company, and its

target market is not limited by
geography, thus all over the world
describes its worldwide reach
accordingly.
4. Technology YES Comprehensive and state-of-the-art

refer to the level of technology that
GODADDY, INC. 27

GoDaddy provides with its products
and services; as a technology
company, being at the forefront of
advances is important for the mission.
5. Concern for survival, YES The mission explains that through its
growth, & profitability efforts, it will be maximizing value for
both customers and shareholders,
reflecting its concern for profitability.
6. Philosophy YES The company philosophy of

supporting entrepreneurs in building
their business from the revised vision
statement is encapsulated completely
in the phrase enabling them to build
and grow their online business
presence.
7. Self-concept YES While the mission is focused on

growing entrepreneurial business,
GoDaddy is self-aware that it attained
its position in the Internet industry by
becoming the world’s leading domain
registrar, and can use that reputation
to build its future businesses.
8. Public image YES GoDaddy prides itself on international,

multilingual, localized support for all
of its services through its GoDaddy
Guides Customer Service
Representatives, who are 70% of the
company’s workforce.
9. Concern for employees YES GoDaddy has won multiple awards for
diversity in employment, with
employees all over the world.
10. Nation-building YES While not Philippines-centric, the

phrase world-class service to anyone,
regardless of background showcases
GoDaddy’s focus on entrepreneurs,
and the ability to support those who
come from disadvantaged or
uneducated backgrounds through its
localized GoDaddy Guides, which can
help to support and grow local
businesses in developing countries
such as the Philippines.
GODADDY, INC. 28
4. External Analysis
Once relevant vision and mission statements for the company are formulated, a
thorough analysis of all external factors affecting the company must be conducted to help
determine which potential strategic decisions would be advised for GoDaddy, Inc. to pursue
in order to achieve the goals of the vision and mission. This can be done by looking at the
general environment in which the company is operating in terms of economic, governmental,
technological, and social forces; reviewing the specific market and industry that the company
is operating in and understanding its current market position and key customer profiles; and
examining the forces of rivalry that can help define the structure and performance of an
industry in order to evaluate different threats and opportunities that the company needs to
respond to or take advantage of. Throughout this section, various subsections will refer to
these threats and opportunities, which will then be analyzed and presented in an External
Forces Evaluation (EFE) Matrix, along with GoDaddy, Inc.’s response to these factors, to
help determine GoDaddy’s overall response to forces acting upon it from outside the
company structure.
4.1 General Environment
4.1.1 Economic Forces
4.1.1.1 OPPORTUNITY: Growth of global e-commerce industry
Global e-commerce sales, or B2B and B2C sales conducted over the Internet on
websites and e-marketplaces, have grown considerably over the last five years. While some
may think this trend intensified due to the COVID-19 pandemic, it has been increasing in
popularity since well before then, due to the “infiltration of technology into consumers’ lives”
(Oberlo, 2021); 76.1% of all Internet users, aged 16 to 64, purchased something online in
GODADDY, INC. 29
2020 – this is a huge market and led to global e-commerce sales reaching $4.280 trillion in
2020 (Kemp, 2021).
In terms of calculating the impact of the growing industry on different companies,
however, one must understand certain global divides. While Oberlo and Kemp (2021) both
note that 2021 global e-commerce sales should reach $4.891 trillion, more than half of that
total will be produced in the People’s Republic of China, where global companies have
limited or no presence, and where the Chinese government has mandated the push towards e-
commerce to better track economic movement within the country. Nevertheless, the e-
commerce market in the United States, the second largest market in the world, is predicted to
grow by 13.7% to $908.73 billion in 2021, leaving plenty of room for GoDaddy and its
competitors to grow outside of China (Phaneuf, 2021).
Figure 5 - Global E-Commerce Sales (2019-2024)
By 2024, global e-commerce sales are predicted to reach $6.388 trillion, showing a
10.3% CAGR, or Compound Annual Growth Rate (Oberlo, 2021), and with China petitioning
for further inclusion in the World Trade Organization and the new Comprehensive and
Progressive Agreement for Trans-Pacific Partnership (CPTPP), Western and other
international companies may have the change to penetrate deeper into the Chinese e-
GODADDY, INC. 30
commerce market, making the growth of the industry even more attractive than by looking at
the US or greater international market alone (Reuters, 2021).
4.1.1.2 OPPORTUNITY: Growth of global web-hosting industry
While e-commerce (the buying and selling of goods and services over the Internet) is
overall much more valuable in absolute amounts, the web-hosting industry (or the selling of
services around designing and hosting websites for individuals and companies) is actually
growing at a faster rate, and more of the business is centered in markets accessible to
companies like GoDaddy, Inc. The global market for Web Hosting services, which stood at
about $71.1 billion in 2020, is expected to grow to a projected size of $152.7 billion by 2026,
which shows a CAGR of 13.2% over the interim period, higher than the projected CAGR of
e-commerce as a whole (Global Industry Analysts, Inc., 2021). More of this business is also
available outside of the China market, with North America (the United States and Canada)
dominating the business in this market with a share of 35.3% in 2019; attributable to the fact
that the United States has the highest number of websites on the Internet, and that China’s e-
commerce is centered more around mobile app usage than websites and the hosting required
to fuel website traffic (Grand View Research, 2020).
4.1.2 Government, Political, and Legal Forces
4.1.2.1 THREAT: Increasingly strict data privacy regulations
With the increased interest in e-commerce across the world, governments have been
concerned with protecting the privacy of their citizenry and their data, including the
Philippines, with the passing of Republic Act 10173, the Data Privacy Act of 2012 (GovPH,
2012). With the global reach of internet businesses, merchants must be aware of all laws and
regulations affecting them, not only in their own jurisdiction, but also in the jurisdiction of
any customers that may shop on their site. For example, if a Filipino customer shops and
GODADDY, INC. 31
purchases something on an American merchant’s website, the American merchant must be
compliant with aspects of the Philippine Data Privacy Act.
These data privacy principles mostly revolve around protecting the private
information of customers, including their identity and payment information, as well as their
browsing history on the site, which is often tracked using files known as cookies (Stewart,
2019). The majority of websites that offer global purchases as of 2021 also include a popup
advisory asking customers to accept that site’s tracking cookies.
The reason for this advisory is due to the most stringent data privacy regulations
globally, passed by the European Union in 2018 and known as the General Data Protection
Regulation (GDPR). Any online business that wishes to do any transaction with any
European citizen, business, or other entity must comply 100% with GDPR regulations or be
subject to fines and other penalties by European Union regulators (European Union, 2021).
These regulations not only include the security of personal information, a strict voluntary
cookie policy, and other compliance regulations, but also a directive known as the “Right to
be forgotten,” or a right for any customer to ask the merchant/website to delete any and all
personal data they may have collected from the customer while browsing.
While the GDPR may not affect smaller, local merchants, any merchant who wishes
to do business on the global Internet scale must be compliant with the GDPR (used as the
benchmark for all other data privacy regulations worldwide), which can be a large challenge
for smaller businesses with little knowledge of the regulations or requirements. GoDaddy, as
a larger SaaS platform provider, can assist these small businesses with compliance issues by
including these provisions in their online store platforms.
4.1.2.2 THREAT: International differences in VAT/sales taxes
Traditionally, small Internet businesses did not worry themselves too much with
charging sales tax or Value-Added Tax (VAT) on purchases, especially small ones, as they
GODADDY, INC. 32
often escaped the notice of national governments. However, this has changed dramatically
over the last five years, with countries, states, and regions all mandating sales tax compliance
for online businesses, with a myriad of different regulations and requirements. It is
particularly difficult to stay compliant in the United States, as there is no national sales tax;
sales taxes are charged at different rates by each of the 50 states, as well as many city-level
governments; these taxes must be charged after the advertised price (unlike most countries
where VAT is calculated on the receipt using the advertised retail price). In addition to this,
different states and cities have different rules on whether their tax should be charged if the
merchant is located in that area, the customer is located in that area, both, or either (Intuit,
2021). This difficulty is compounded by ever-changing rules released by different countries
in order to capture VAT revenue for their countries – the EU, for example, released in July
2021 new e-commerce VAT rules structured around the location of the consumer, which is
much more difficult for the merchant to be compliant with (European Commission, 2021).
This is another large threat for a small merchant (or an aspiring e-commerce platform) to
navigate successfully when trying to sell goods and services to a global market, with the
hazard of fines or other punitive actions from any number of different governments around
the globe; and as is the case with most governmental regulations, ignorance of the law is not
a valid excuse on the part of the merchant.
4.1.3 Technological Forces
4.1.3.1 OPPORTUNITY: Cost of cloud infrastructure
The major force behind the growth of SaaS platforms over the last 5-10 years has
been the expansion and constantly lowering price of cloud computing infrastructure. Led by
massive data firms such as Amazon Web Services (AWS), Microsoft Azure, Digital Ocean,
and Google Cloud, cloud infrastructure involves companies purchasing time, storage, and
GODADDY, INC. 33
processing power on cloud companies’ private platforms, which a platform can then use to
run their software as services to their customers over the Internet (Maayan, 2021).
As cloud infrastructure, Internet infrastructure (both overall speed and bandwidth
available to consumers), and processing power all increase in strength and availability, the
price of cloud services (the main “infrastructure” cost of a SaaS company) is decreasing
dramatically. This drop in price is measured and defined by the recently-proposed Bezos’
Law (named after Jeff Bezos of Amazon) which states, “A unit of [cloud] computing power
price is reduced by 50 percent approximately every three years” (Supernor, 2018). With this
continued reduction in price, this gives SaaS platform companies an opportunity to leverage
the cloud even more heavily to develop, update, and disseminate their products to customers.
4.1.3.2 OPPORTUNITY: E-commerce technology constantly improving
As the infrastructure for SaaS e-commerce has been improving steadily over the
years, so has the improvement in the technology involved in e-commerce, both software and
hardware. From agreements between credit card processors and software providers to provide
more seamless and secure online transactions to customers all around the world, to
companies creating physical hardware checkout terminals that are connected with this new
online technology, to surpassing traditional checkout/cash registers for ease of use and clarity
of record-keeping, the technology of e-commerce is constantly growing and improving
(Armstrong, 2018).
The combination of ever-improving technology with the advancements in speed and
accessibility of cloud infrastructure gives a massive opportunity to SaaS platforms to
consistently and speedily update/upgrade their systems, keep up with the competition and
maintain fast, up-to-date services for their customers without having to rely on a physical
supply chain.
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4.1.3.3 THREAT: Cybersecurity
The biggest threat to any online business, whether it is an infrastructure company, a
SaaS platform provider, or an individual entrepreneur or small business running an online
store, is undoubtedly cybersecurity. Ensuring the security of access to a company’s records,
data about customers, payment information, credit card numbers, and more, is of primary
importance to any online business.
As technology continues to improve for the customer, so does the technology to
“hack” that technology for cybercriminals who wish to take that data for their own purposes.
Cybercrime can consist of many things, including hijacking a site and diverting traffic to
another site where personal/financial data can be taken from customers; “phishing”
communications to steal login data from customers or employees; “ransomware”, or when the
criminal destabilizes or turns off access to a company’s network or product, and will only
turn it back on in exchange for a monetary payment; and more.
Even more concerning are attacks directly targeting Internet infrastructure, which can
affect multiple companies at once, and is next to impossible for individual companies to
defend against (Thibodeaux, 2021). Companies must therefore have a number of backup and
contingency plans to account for cybercrime and other online security issues.
4.1.4 Social, Cultural, Demographic, and Environmental Forces
Demographically and socially, the use of e-commerce for online shopping is
surprisingly consistent across age levels, genders, and location in the modern world, with e-
commerce adoption ranging from 71.9% (Males 55-64 years old) to 79.9% (Females 25-44
years old) worldwide among the 2.14 billion people estimated to have purchased something
online in 2020 (Mohsin, 2021). The biggest forces affecting e-commerce in this category,
therefore, are the device on which the e-commerce is accessed (desktop or mobile, depending
on age group), and the channel where the e-commerce function is actioned; either through a
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specific brand’s store, a larger retailer with multiple brands, or an e-marketplace such as
Amazon or Lazada (Kemp, 2021).
4.1.4.1 THREAT: Customers prefer to shop on larger e-marketplaces
Public research on e-commerce trends show that customers overwhelmingly prefer to
shop for items online on larger sites of retailers or massive e-marketplaces; only a fifth of
consumers prefer to shop on the specific brand’s website, either for initial or repeat purchases
(Story, 2018).
This is a threat to any individual or small business who wishes to create a successful
online e-commerce business, as well as a threat to SaaS platforms who want to help enable
these customers to create these stores through their services. The industry must be vigilant for
opportunities to link their services (and their merchants’ goods) to the larger retailers and e-
marketplaces through plugins and integrations in order to ensure visibility for the merchant
and a higher likelihood that an online shopper will find and purchase their product.
4.2 Industry and Competitor Analysis
Once the general environmental concerns are noted and analyzed (using the lens of
the company’s industry and markets), the industry itself can be examined in more depth in
order to analyze specific opportunities and threats affecting GoDaddy, Inc. In this paper, the
industry analysis will also assist in identifying the specific vertical and market niche to be
used for comparison. The Internet technology industry is very fractured and multi-channeled
– companies may focus on products that compete with other companies, and other products
may require collaboration with the same companies. Therefore, choosing specific competitors
for a market analysis requires a clear identification and demarcation of the industry sub-niche
and exactly which market space and customer profile the companies are competing for.
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4.2.1 Industry and Market Analysis
4.2.1.1 Products and Services
As described in the introduction of this paper, this analysis will focus on the
Software-as-a-Service (SaaS) platform side of GoDaddy’s business, specifically how it
relates to e-commerce. As such, this analysis must note the specific products and services
within this vertical to identify the correct industry and competitors to benchmark against.
In terms of which products a company must have to identify it as a competitor to
GoDaddy, Inc., Barclays Research (2021) created a customer road map around SaaS e-
commerce platforms, identifying two main areas of products and services required, along
with a third “optional” leg around other business solutions:
Figure 6 - High-Level Customer Roadmap for E-Commerce (Young, et al., 2021)
The two “required” feature categories, Presence and Commerce, map fairly well with
GoDaddy’s SaaS products and services identified in the introduction of this paper, in terms of
an “all-in-one” or “most-in-one” SaaS platform for a merchant to set up their own website
and online store: hosting, customer service, store setup, and payment collection/integration.
Therefore, companies to be used as competition should have similar products and services, at
least in the Presence and Commerce areas, and potentially other business solutions alluded to
in the third section.

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4.2.1.2 Price
One of the defining concepts of Software-as-a-Service is that it is sold to customers
on a subscription model, rather than a one-time software package purchase (Turner, 2019).
GoDaddy, Inc. offers such a subscription model for all of its products and services at a
monthly rate (often with discounts for an annual contract). Therefore, any identified
competition should have a similar subscription model.
The actual price points of the subscription services do not need to be directly equal, as
different prices can offer different levels of products and services required by different
customers. However, each company identified as a competitor of GoDaddy should have at
least one level of their subscription plan with prices comparable to GoDaddy’s plans, which
average between US $20-40 depending on the level/type of service offered (GoDaddy, Inc.,
2021).
4.2.1.3 Promotion
Promotion for Internet companies, regardless of which sub-industry they are involved
in, is primarily achieved through online advertising to create brand awareness and word-of-
mouth promotion, reviews, and ratings, which create brand loyalty and gain new customers
(Rhodes, 2017). Additional promotional channels such as television or print are possible, as
GoDaddy did in previous years, but with the increased prevalence of broadband internet and
the ubiquitous access to the internet now available in most markets around the globe, these
extra channels are not optimal to reach the target audience for the SaaS e-commerce industry
(Metz, 2015).
4.2.1.4 Distribution Channels
SaaS e-commerce platforms are themselves distribution channels for their customers’
products and services, but the platforms must also have channels in which to gain customers
and business. There are two main channels for SaaS platforms to gain customers. The first
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and foremost is direct sales, gained from brand awareness and advertising as noted above.
Customers will subscribe to a company’s services directly from the website (such as
www.godaddy.com) or by contacting the company directly by email or telephone.
The second channel, which can be important as well to develop brand awareness and
loyalty, is that of third-party web designers, whether individuals or professional design firms,
that use the platforms of the company to develop comprehensive sites for business clients
who are not tech-savvy enough to accomplish that task for themselves. SaaS platforms such
as GoDaddy can offer additional tools for the “professional” designer, including analytics and
customization tools, that can influence the professional designer to bring in their smaller
clients to use the company’s platform (GoDaddy, Inc., 2021).
4.2.1.5 Market Share Analysis
While some industries may look at different factors to determine market share, such
as total number of customers a company has, the SaaS e-commerce industry can be measured
using the standard definition for market share, in which market share is determined by
calculating its total sales as a percentage of an industry’s total; this position is used for
analysis by companies to look at their position within an industry to determine “the best
balance of costs and benefits” of different strategies in order to gain additional market share
(Buzzell, Gale, & Sultan, 1975).
However, in such a fractured market, it can be difficult to determine which revenues
to calculate to determine share in a particular niche market such as SaaS for e-commerce.
GoDaddy, and other companies, participate in wildly different verticals and sub-industries,
and there are dozens of e-commerce platforms available for customers to choose from.
Therefore, this paper has identified specific requirements for a company to be
included in the “SaaS e-commerce hosting” industry as presented in the previous sections,
including a subscription-based pricing model, offering both hosting and commerce/payment

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solutions, an internal/proprietary store solution where customers can create an online store
within the cloud platform of the provider, and a publicized target market of entrepreneurs and
small to medium business enterprises.
In creating these requirements, the top five players in this industry were identified and
ranked based on market share, or the total revenue for each company within the hosting/e-
commerce vertical compared to the other competitors. These companies do not compete
against large e-marketplaces or retailers such as Amazon, WalMart, eBay, or Apple, as those
platforms do not provide hosting options for small businesses, but merely act as retailers of
items on contract (or their own proprietary products). As other tangential competitors in this
market are either significantly smaller, non-proprietary, re-sellers of other products, or not
targeted towards business/e-commerce, any future market share percentages in this paper
refer to a company’s market share within the top five players as identified in this section:
Shopify, Inc., GoDaddy, Inc., Wix, SquareSpace, and BigCommerce. Companies based in the
Chinese domestic market (Alibaba, Taobao, etc.) are also excluded from this calculation, as
they cannot be compared equitably with global companies outside of the Chinese market.
Each company’s SaaS e-commerce revenue and relative market share for 2020 (the most
recent completed year with full records available) are presented in the table below.
Table 8 - Relative Market Share for Top Five SaaS E-Commerce Platform Providers
Rank Company FY20 SaaS Revenue Relative Market Share

1 Shopify $2.929 billion 49.90%
2 GoDaddy $1.802 billion* 23.82%
3 Wix $989 million 14.75%
4 SquareSpace $621 million 9.17%
5 BigCommerce $152 million 2.35%
*GoDaddy’s total revenue in 2020 was $3.317 billion; difference is from revenue from Domain vertical,
not connected to SaaS e-commerce and thus not used for market share calculations.
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4.2.1.6 Growth Rate and Stage in Growth Cycle
Total revenues for the Top 5 SaaS e-commerce platform companies in 2020 totaled
$6.493 billion, a very small percentage of the overall global e-commerce market value of
$4.280 trillion (Kemp, 2021), which includes the Gross Merchandise Value (GMV) of all
products purchased, and not only the fees/revenues collected by the platforms. As such, the
CAGR previously identified as an general opportunity for the industry as a whole, while
useful, is not indicative of the performance of the specific SaaS e-commerce platform
industry. To calculate that particular growth rate, the historical revenue performance of the
previously identified Top 5 firms should be calculated and compared. As future financial
projections in this paper will focus on the years 2022 – 2024, the following CAGR is
calculated from reported revenues 2018-2020, as well as projected revenues for 2021 based
on Q1 and Q2 reported results by each company:
Table 9 - CAGR for Top 5 SaaS E-Commerce Firms, 2018-2021 (in $millions)
Company 2018 2019 2020 2021 (est.) CAGR

Shopify 1,073 1,578 2,929 4,200 58%
GoDaddy 1,440 1,637 1,802 2,005 12%
Wix 604 761 989 1,241 27%
SquareSpace 390 485 621 772 26%
BigCommerce 92 112 152 198 29%
Total 3,599 4,573 6,493 8.416 33%
With these numbers it is clear that while the SaaS e-commerce industry is a small
subset of the total global e-commerce market, the average growth rate of 33% for the top five
firms is much higher than the 10.3% CAGR for the industry as a whole, and is thus very
attractive. It is also worth noting here that GoDaddy’s growth rate of 12% between 2018-
2021 is much lower than that of its nearest competitors; indeed, it previously held the number
one ranking in 2018 and 2019 before ceding the position to Shopify, whose revenues in SaaS
e-commerce are estimated at more than double that of GoDaddy’s in 2021 (Shopify, Inc.,
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2021). This represents both a weakness and an opportunity for GoDaddy in terms of spurring
growth and gaining more market share in the near future, as the SaaS e-commerce platform
industry, with its markedly high growth rates, is well-established in the Growth phase of the
Product Life Cycle as defined by Theodore Levitt (1965), where demand is accelerated and
the size of the total market is continuing to expand rapidly, providing many opportunities for
growth and profit.
4.2.1.7 Market Size and Customer Profile
As noted in GoDaddy’s vision and mission statements, its online advertising, and
even the descriptions of the company’s products and services, the target customer profiles for
GoDaddy and competitors in the SaaS e-commerce industry are primarily entrepreneurs,
SMBs, and other small business enterprises. As the industry expands out of its historical base
of North America, the market can expand to global “micro” businesses and SMBs that are
also growing businesses both in their own local markets and attempting to scale and expand
globally.
Larger enterprises, while seemingly an attractive market due to their financial power
and potential for large amounts of revenue, are not the ideal customer profile for SaaS e-
commerce providers – the larger the company or enterprise, the larger their own in-house
resources to develop their own dedicated suite of tools and solutions to meet its internal
requirements.
The following figure shows calculations from Barclays Research (2021) that
measures the potential growth of the market based on the expansion of the industry into the
global market from its historical North American base. This shows the attractiveness of the
industry not just in revenue numbers, but the total available market potential in terms of
customer numbers.
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Figure 7 - Customer Profile & TAM for SaaS E-Commerce (Young, et al., 2021)
4.2.1.8 Factors Affecting Cost of Doing Business
The factors that can affect the cost of doing business in the SaaS e-commerce industry
are the opportunities and threats that have already been identified within this section. With
the growth of both the global e-commerce and web hosting industries, prices for subscription
models set by the companies can rise or fall depending on the competition. Increasing
governmental regulations, which are different across regions, states, and countries, will incur
additional cost to the companies in order to maintain continual compliance. The cost involved
in maintaining technological progress of their products and services are also a factor, from
the cost of the cloud infrastructure required to run the SaaS platform, to the investment in
hiring and R&D budgets to have sufficient software engineers to be able to update and
innovate the products to keep up with any competition. All of these factors are integrated into
the Porter’s Five Forces of Competition model, presented below, in order to provide a broad
categorization of the attractiveness of the industry.
4.2.2 Porter’s Five Forces of Competition Model
The internet industry is extremely fractured, with companies operating in many
different sectors, technologies, products, and services. As such, it can be difficult to directly
compare businesses and derive a logical structure for the industry that a particular company
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in which a company is competing. In cases like this, an industry analysis tool such as the Five
Competitive Forces model from Harvard professor Michael E. Porter is very valuable to
determine the forces that affect a particular company and the unique industry in which it
operates. Porter separates the forces that affect an industry into the Threat of New Entrants,
the Bargaining Power of Suppliers, the Bargaining Power of Buyers, the Threat of
Substitutes, and the overall Rivalry of Competition. As Porter (2008) himself notes, “The
extended rivalry that results from all five forces defines an industry’s structure and shapes the
nature of the competitive interaction within an industry.”
In this section this paper examines the five forces of the Porter model as it relates to
GoDaddy, Inc., and the SaaS E-Commerce web services industry.
4.2.2.1 Threat of New Entrants
The Internet age is littered with examples of where a “web” company was originally
known as the master of a certain space and then was eclipsed, sometimes very quickly, by an
upstart competitor that drove the original company out of the top position, and sometimes out
of business. Some of these examples include Google overtaking Yahoo, AltaVista, AskJeeves,
and other 1990s-era companies as the primary search engine used worldwide today;
Facebook dominating the social media space after its introduction in 2004, destroying
previous leaders in the space such as MySpace, Friendster, Orkut, and others; and modern
messaging platforms like WhatsApp, Telegram, Viber, and Facebook Messenger overtaking
more classic platforms such as AOL Instant Messenger, MSN Messenger, and ICQ. This may
give an observer the appearance that the threat of new entrants into a market is extremely
high, and a newcomer could quickly force a company into bankruptcy.
However, the above scenarios involve services which are (in general) free to the end-
user/customer. When money becomes involved, then reputation of the established companies
are often enough to keep them in competition. For example, while Amazon is the world
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leader in online marketplaces, and the world’s most valuable brand in 2019 (Hanbury, 2019),
the market is still wide open for other marketplaces such as Ebay, Lazada, Shopee, Alibaba,
and others. Reputation and local access are important for web businesses that cost money to
use, and therefore new entrants will need time to build and develop that reputation. In
addition, for SaaS e-commerce services, there are multiple barriers to entry in order to
compete with established players, such as governmental regulations around online sales,
being able to legally/securely process payments (both domestic and cross-border), and the
differing sales tax/VAT rules in different countries, which require considerable investment
and infrastructure in order to become compliant. As such, the Threat of New Entrants is rated
Moderate.
4.2.2.2 Bargaining Power of Suppliers
The entire business model of the SaaS e-commerce industry revolves around the
companies providing their own software, as a service, to customers. As such, they are
considered to be suppliers themselves. The only suppliers they would need to work with are
the companies providing them with the technological infrastructure to provide those software
services. Some web services companies, such as Wix, operate their own data centers, or
facilities with network servers, storage space, and more and provide their own infrastructure,
where they would also need to bargain with the suppliers of the actual hardware (Wix, Inc.,
2021). Most other companies use cloud infrastructure, from companies such as Amazon Web
Services, Google Cloud, Microsoft Azure, or Digital Ocean, where a third-party supplier
provides the infrastructure to provide the company’s software over the internet to customers.
However, companies who can afford data centers or cloud infrastructure services have the
technical ability to change suppliers as needed based on costs or other factors; with the
competition in the cloud industry being quite high, prices are not likely to changed at the
whim of a supplier.
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The same goes for the other services companies may need to have supplied by a third-
party, such as payment processing. Many e-commerce companies use services such as Stripe
or PayPal to help them process payments from online customers. However, the transaction
fees that these companies can charge are often set by legislation, and companies can always
choose to switch to direct relationships with banks, credit card companies, or other “e-
money” services.
With these points in mind, one can rate the Bargaining Power of Suppliers in this
market as Low.
4.2.2.3 Bargaining Power of Buyers
As previously mentioned, there are many competitors in the web industry as a whole,
and a good number within the SaaS e-commerce industry as well. This lets customers be very
price-conscious and “shop around” for their preferred SaaS product (or other
alternatives/substitutes) that provides the services they need for the best possible price. While
that would lead to the assumption that the bargaining power of buyers would be high, it is
mitigated by the fact that once a customer chooses a specific platform, it can be
technologically and logistically difficult to change providers, or “migrate” to a new platform.
There is also the cost to the merchant/customer of the “downtime” during the period of
switching to a new platform, and any customer dissatisfaction with the downtime or change.
That is why many SaaS platforms (such as GoDaddy) have a promotional price at the
beginning of a merchant’s contract, and the renewal price is then higher (GoDaddy, Inc.,
2021). So once a merchant chooses a particular platform to work with, they tend to stay with
that platform, barring a more serious need to change due to requiring specific services that
the platform does not provide.
In addition, due to the explosive growth of the e-commerce industry as a whole
globally, there are constantly new merchants for companies to target as customers for their
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products. As such there is not a large amount of competition between companies to take
existing customers away from each other, as they find it easier to target new merchants with
new contracts. Buyers are generally not able to “negotiate” prices with the platforms, nor
would one specific subgroup of buyers be able to influence the prices of the services as a
whole due to any financial sway within the industry. While this paper will explore strategies
to change this way of thinking in order to increase specific market share for GoDaddy, Inc., at
present the Bargaining Power of Buyers is rated Low.
4.2.2.4 Threat of Substitutes
The SaaS e-commerce web services industry targets small and medium-sized
enterprises to help them set up an online store to sell their products (physical or virtual) over
the internet. However, this is not the only option, by far, for businesses to be able to sell their
products online. In addition to SaaS platforms, merchants can develop their own in-house
platforms, or use open-source/free software packages (that they would need to set up and host
themselves, or pay a hosting company). They can also sell directly using the infrastructure of
existing e-marketplaces, like Amazon, Ebay, Lazada, Shopee, or even Facebook Marketplace.
There are a number of mitigating factors for each of these options, however. Compared to
using an in-house platform, SaaS e-commerce solutions are often much easier and faster to
set up, and may even provide cost savings over time in terms of site management and
infrastructure costs compared to open-source solutions. As many small businesses do not
have the technical knowledge or expertise on their staff (especially entrepreneurial businesses
with 1-2 people), using an open-source solution would require the use of outside contractors
or hiring a webmaster. SaaS platforms are designed for businesses to be able to set up their
online store with no specialized technical knowledge. And while merchants can sell directly
on the larger e-marketplaces, those marketplaces often take a much larger transaction
fee/commission for those purchases, which can impact the merchant’s margin; there is also
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the reputation/prestige factor of having a dedicated store/website for a company’s products.
Nevertheless, due to the prevalence of other options, the Threat of Substitutes in this industry
is High.
4.2.2.5 Rivalry of Competition
The Rivalry of Competition factor takes into account the previous four forces to
determine its strength; as previously noted, it is difficult to determine exactly how to compare
direct competitors as the companies in this market may be involved in many different diverse
other verticals that do not compete directly with a company like GoDaddy, so we can look at
the Five Forces Analysis for a better picture of the current situation.
With a constantly shifting technological base and the possibility of a new technology
or product coming from a new entrant ever present, along with competitors utilizing many
different strategies and coming from unique origins and cultural backgrounds (unlike a more
static market like fast moving consumer goods, where most of the companies are structured
similarly for cost efficiencies), competition is always going to be a serious concern for any
company in this industry. That being said, with a rapidly expanding market for its services
and an ever-increasing customer base (as small entrepreneurial ventures become more and
more common, especially in less developed countries), there will be no shortage of new
customers available to be brought into a company’s subscriber base. In addition, even those
merchants who use other platforms such as larger e-marketplaces are increasingly looking at
the attractiveness of omni-channel sales to increase overall revenue and profitability (Briedis,
Gregg, Heidenreich, & Liu, 2021). This means that merchants who are already using
substitute platforms can be considered as targets of opportunity for the SaaS e-commerce
providers. In all, this marks the Rivalry of Competition within the SaaS e-commerce industry
as Moderate.
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Figure 8 - Porter's Five Forces Analysis for SaaS E-Commerce Industry
4.2.2.6 Rating the Attractiveness of the Industry
After reviewing the general environment, industry analysis, and the Porter’s Five
Forces of Competition for the industry, one can analyze that data along with the historical and
projected growth rate of the particular industry to determine the general attractiveness of the
industry as a whole. Previous sections detailed the incredible growth rate of the global e-
commerce industry in terms of sales, with a historical 33% CAGR for 2018-2021 for the
SaaS e-commerce platform industry alone, a 10.3% projected CAGR over the years 2021-
2024 for the global e-commerce industry as a whole, as well as the continued growth of the
web hosting industry and the increase in market size as new individuals and business
embrace online presence and business activities. This healthy growth rate, combined with a
moderate Rivalry of Competition as determined by the Porter’s Five Forces analysis, makes
the SaaS e-commerce web services industry an attractive one for GoDaddy to continue
operating within through the next stage of its growth. The company can thus focus on its key
competitors in the industry to help determine future strategic objectives rather than looking
into leaving the market, as would be the case in more risky industries or those with
smaller/shrinking growth rates.

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4.2.3 Key Competitor Profiles
Once the market has been quantified and determined to be attractive, and the top
competitors in terms of market share have been identified, the next step is for the company to
profile and study the top competitors in the market to determine how much of a threat they
are to their own performance, how those companies are performing in relation to themselves,
and begin to formulate ideas and strategies on how to compete successfully against them. In
this section are profiles of the largest competitors to GoDaddy, Inc. in the SaaS e-commerce
platform industry.
4.2.3.1 THREAT: Competition from fellow SaaS platform providers
As noted in the Market Analysis section above, due to the fractured nature of the
Internet and different companies taking different approaches with their products so as to not
fit cleanly into a particular industry as a whole, a realistic analysis of the competition must
focus on the main competition to the company for which one is preparing strategies. In this
case, as GoDaddy is focusing on SaaS e-commerce web services based on a subscription
model targeted towards entrepreneurs and small businesses, the competition identified must
do the same. The top five providers of these services (including GoDaddy) have been
identified and listed; the following sections provide a general profile of each competitor, their
background, current revenues, and competitive position in relation to GoDaddy, Inc.
4.2.3.2 Shopify
Shopify was founded in 2004 in Ottawa, Canada, by friends Tobias Lütke, Daniel
Weinand, and Scott Lake, as a personal e-commerce platform for the three partners to sell
snowboarding equipment. By 2006, the personal platform had been redesigned and launched
as Shopify for other merchants to be able to use the online store developed by the three
partners. Shopify begin to grow quickly starting in 2009, when they developed an application
programming interface (API), which allowed other developers to create applications

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specifically for Shopify within a Shopify-controlled app store. Additionally, in 2013, Shopify
introduced Shopify Payments, which allowed merchants to use an in-house payment system,
making payment processing and account creation for the merchants much easier, and
providing transaction fee revenue to Shopify. This payment system was initially only
available online, but in 2017 was also introduced for physical point-of-sale (POS) payments
using iPads with proprietary credit/debit card scanners. However, the main impetus for the
growth of Shopify began in 2015, when the company went public on the New York and
Toronto stock exchanges, and Amazon recommended Shopify to its third-party merchants for
its e-commerce service tools around managing product inventory in a virtual, online business
environment (Merritt, 2020).
Figure 9 - Shopify Logo
Shopify’s revenue has grown more than tenfold in five years, with 2015 revenues of
$205.23 million and 2020 revenues of $2.93 billion. It declares revenue in two different
categories within SaaS e-commerce; Subscription Solutions, or the fees involved in the
monthly subscription fees for the Shopify hosting service, plus any additional sales of apps,
plugins, and themes on the store; and Merchant Solutions, which consist of payment
processing fees collected through Shopify Payments, its proprietary payment system.
Merchant Solutions accounted for 68.94% of total revenue for Shopify in 2020. Shopify
Payments is a unique advantage for Shopify – they charge standard fees for their proprietary
system, but also allow third party payment processors to be used on Shopify stores by
merchants with an additional extra fee that they also collect. In this way, Shopify profits
whether a merchant uses its own payments system or an outside option (Dean, 2021).
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Shopify offers different tiers of subscription services; a basic package at $29/month, a
Standard package at $79/month, and a “professional” tier at $299/month. Approximately half
its merchants are located in the United States, 25% in Europe, the Middle East, and Africa
(EMEA), and the rest distributed around the rest of the world, with a total of 1.75 million
merchants using the Shopify platform to host their online store and sell products. The
company has 7,000 employees and contractors around the world as of the end of 2020, a
massive increase from 1,048 in 2015, reflecting its accelerated growth in the last five years
(Shopify, Inc., 2021).
4.2.3.3 Wix
Wix, also known as Wix.com, Wix, Inc., or Wix, Ltd. (depending on which country a
subsidiary is registered in), was founded in 2006 in Tel Aviv, Israel by Avishai Abrahami,
Nadav Abrahami, and Giora Kaplan. Wix’s initial idea was not necessarily centered around e-
commerce, but around presence – individual websites for content creators or small startups to
pitch ideas online. Wix launched an app market similar to Shopify’s in 2012, which allowed
outside users to create and sell applications for use on Wix sites, including storefronts and
business tools, but an external infrastructure for this was not available until 2014 when the
company launched WixHive, an API similar to the Shopify API, and acquired the fellow
Israeli company Appixia, which would allow users to create native mobile e-commerce
applications on their Wix accounts (Wix, Inc., 2014).
Figure 10 - Wix.com Logo
Wix’s customer acquisition strategy is much different than the other competitors in
the market. Since their initial business centered around online presence and not necessarily e-
commerce, it offers a free tier for anyone who wishes to create a website – there is no ability
to make this free site work with e-commerce, but this simple free website option is available
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to anyone, and Wix claimed it had 200 million customers with accounts in 2021 and calls
itself “The Leader in Website Creation” (Wix, Inc., 2021). By reviewing the revenues of Wix
compared to Shopify however ($989 million for Wix versus $2.93 billion for Shopify with
only 1.75 million merchants), it is clear that the vast majority of those “customers” are users
on the free tier of service.
To make revenue, Wix offers subscription services above the free tier with additional
hosting options, video capability, and e-commerce options. Wix also has an app store with
paid plugins available to customize a site (for paying subscribers), and its own proprietary
payments system, Wix Payments, although merchants can use third-party payment processors
on Wix with no extra fee, unlike Shopify (Wix, Inc., 2021). Wix does have some negative
reputation attached to it around the extra difficulty in exporting content from its platform to
another if a customer wishes, and appropriating code from open-source libraries without
proper licensing and attribution (Gallagher, 2016).
With 5,000 employees and contractors in 15 locations around the world, and $989
million in total revenue in 2020, Wix is in a comfortable third place in market share for SaaS
e-commerce platforms (Wix.com Ltd., 2021).
4.2.3.4 SquareSpace
SquareSpace was founded in 2003 by Anthony Casalena while he was a student at the
University of Maryland; it was originally designed to be a hosting service for blogs only, but
quickly expanded to additional services and by 2006 the company had reached $1 million in
revenue, with Casalena as the only employee (SquareSpace, Inc., 2021).
Similar to Wix, SquareSpace was created with the goal to help creative ideas succeed
and for people to get their presence established on the Internet. However, where Wix
promoted free tiers, ease, and quickness, SquareSpace was created with an emphasis on
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smooth and elegant design of the webpages, and only has subscription options available
(SquareSpace, Inc., 2021).
Figure 11 - SquareSpace Logo
SquareSpace had already added e-commerce tools and options as of 2014, but does
not have its own proprietary payments system; it uses a third-party connection through Stripe,
an independent Internet-based payment processor, and so is not able to gain revenue from
transaction fees. This would be a large factor in why its revenues are lower than the top three
competitors in the market. SquareSpace has 1,143 employees as of 2021 and had its Initial
Public Offering (IPO) on the New York Stock Exchange in May of 2021, with reported
revenues of $621 million in 2020 (Giles, 2021).
4.2.3.5 BigCommerce
BigCommerce is the only SaaS e-commerce platform in the top five that was
originally designed to be sold as a service to merchants and companies, rather than having
evolved into it. Founded in 2009 in Australia by Eddie Machaalani and Mitchell Harper as
Interspire, the company moved to the United States that same year and renamed itself to
BigCommerce.
Figure 12 - BigCommerce Logo
While BigCommerce has “Essentials” pricing plans that are at the same level as
Shopify’s price points, and the platform can be used by individual entrepreneurs and small
businesses, BigCommerce’s marketing is targeted more towards medium to large enterprises,
and have around 60,000 merchants using their platform as of 2021 (BigCommerce, Inc.,
2021).
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BigCommerce does not have a customizable app store or outside plugins, nor does it
have a proprietary payments system, but it advertises high levels of customer support and
customization to its customers through its customer support team of designers and e-
commerce experts. BigCommerce had its IPO on the NASDAQ stock exchange in 2020 with
a reported 820 employees in six locations, and reported 2020 revenues of $152 million
(BigCommerce, Inc., 2021).
4.2.3.6 THREAT: Competition from open-source (free) software packages
The key differentiator of the SaaS e-commerce platforms is that they are selling their
software as a service (hence the name SaaS) on their cloud infrastructure to merchants and
customers. However, as can be clearly seen by the difference in SaaS e-commerce platform
revenue versus the overall e-commerce value (billions of dollars versus trillions of dollars),
there are many other options for merchants to sell their goods and services over the Internet.
The closest alternative to SaaS platforms on a subscription model would be open-
source software packages. Open-source software is software that has been created by
developers to release for free on the Internet for use by anyone (Open Source Initiative,
2021). Open-source software is usually created by individual developers or small teams who
wish to “democratize” a specific Internet service to ensure that a company does not
monopolize the service or act as a gatekeeper. One of the most famous examples of open-
source software is the Linux operating system, created by Linus Torvalds in 1991; it now
includes free and commercial distributions using derivations of the original code (The Info
Valley, 2020).
There are a number of open-source e-commerce solutions, including WooCommerce,
Magento, Ecwid, X-Cart, and OpenCart, with hundreds of thousands, or even millions, of
online stores being served by these software packages. While they definitely have a good
percentage of the overall global e-commerce market, they cannot be said to directly compete
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with SaaS e-commerce platforms for a number of reasons (Warnimont, 2021). First and
foremost, all open-source e-commerce solutions require separate, dedicated hosting, which
the merchant must pay for and manage. While some companies (including GoDaddy) offer
“managed” hosting for open-source solutions, there is no linkage between the management of
the website and the actual e-commerce operation. Secondly, open-source solutions require a
much higher level of technical knowledge than SaaS platforms. Entrepreneurs and small
businesses often do not have the expertise to do this themselves or the budget to afford
technical experts to manage their online store for them, which is why many prefer to use
SaaS platforms where ease-of-use and 24-7 customer service is a priority and included in the
subscription cost. As Paul Maiorana, Head of WooCommerce, notes about open-source
software versus SaaS platforms:
“Today, we give them the bag of Lego blocks and you build what you want to build;
but what most people want are the Legos already assembled. I should be able to tell
the platform what kind of store I want, and the platform can create it, with theme,
logo, done. [Open-source software] has a lot of setup and configuration; it’s a lot of
work to put the Lego blocks together in order to meet your vision” (Maiorana, 2021).
4.2.3.7 WordPress/WooCommerce
Another reason that open-source software cannot be said to compete directly with
SaaS platforms is the fact that SaaS platforms often collaborate with or even use open-source
software in their own product offerings to customers. Wix was accused in 2016 of using
open-source code in its e-commerce and site design software for mobile applications without
providing the appropriate attribution and making their own, derivative, code, open-source as
well (Gallagher, 2016). The largest example of collaboration and partnership is WordPress
and WooCommerce’s relationship with GoDaddy.

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WordPress was created in 2003 by Matt Mullenweg, and is the world’s most used
Content Management System (CMS), or system used to deliver and manage content on
websites, with over 42% of all websites on the entire Internet using WordPress as of 2021.
The WordPress CMS is available for free for anyone to download and use on their own
hosting provider (WordPress Foundation, 2021). The WordPress.org Plugin Store has
thousands of free and paid plugins created by developers all over the world.
Figure 13 - WordPress Logo
Mullenweg, while offering WordPress for free to the world, also created a private
company, Automattic, Inc., which sells hosting for WordPress sites and also designs, offers,
and sells specific plugins for WordPress that can be used on other installations of the CMS
(Automattic, Inc., 2021). One of the most popular plugins for WordPress is WooCommerce,
which was acquired by Automattic in 2015.
Figure 14 - WooCommerce Logo
WooCommerce is described as “the most customizable eCommerce platform for
building your online business” (WooCommerce, 2021), and offers thousands of plugins and
customizations, more than even Shopify. However, as an open-source software package,
Automattic (the owners of WooCommerce) cannot earn revenue on the vast majority of the
millions of websites that use WooCommerce. They can only earn revenue if the user chooses
to host their WordPress/WooCommerce site on an Automattic hosting system at
WordPress.com or WooCommerce.com, or if they use the recently released WooCommerce
Payments system within their store; if they use a third-party payment gateway on an
externally-hosted website, Automattic and WooCommerce do not earn revenue at all. As this
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is the stated goal of the open-source movement, they have consciously chosen not to privatize
or create a “walled ecosystem” like Shopify (Maiorana, 2021).
To compensate for this, open-source groups often collaborate with private companies
for additional revenue opportunities, especially if the software itself is popular. Magento, the
second most popular open-source e-commerce software, was acquired by Adobe in 2018 and
privatized (Warnimont, 2021). While WooCommerce and WordPress are still open-source and
free, many private companies offer hosting services and customization/management services
specifically designed for WordPress. GoDaddy is a primary example of this; its Managed
WordPress hosting is a popular paid hosting service in the WordPress ecosystem, and also
offers special customizations for WooCommerce for users who wish to have a much more
customizable e-commerce product than the SaaS platforms offer. GoDaddy makes revenue
from this by charging a subscription fee for the hosting, as well as offering their own
proprietary payment system within WooCommerce as a choice for merchants. Thus,
currently, WooCommerce can be said to be a partner rather than competitor of GoDaddy,
though the strategies later in this paper will encourage GoDaddy to attempt to separate its
reliance on WordPress and WooCommerce for revenue and to focus on its own systems.
There is always the risk that the company behind the open-source software could turn it
completely private and no longer provide updates or support to externally-hosted installations
of the product, as Adobe did when it privatized Magento and turned it into Adobe Commerce
in 2018 (not considered a direct competitor because it is not SaaS based – it also requires
separate hosting, either on Adobe or enterprise servers). It still offers an open-source option,
“Magento Open-Source,” but it is not updated as regularly and does not have the same
options as the now-premium Adobe Commerce (Adobe, 2021). Automattic could
theoretically do the same if it decides to make an initial public offering; privatizing future
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WordPress/WooCommerce releases would heavily increase the estimated value of the
company in an IPO (Young, et al., 2021).
4.2.4 Competitive Profile Matrix
By reviewing the Porter’s Five Forces analysis, the most relevant opportunities and
threats for the SaaS e-commerce industry as a whole, and the profiles of the current largest
competitors in the space, a Competitive Profile Matrix can be derived with the most
important Critical Success Factors (CSFs) to the success of a company in the industry. This
paper presents a Competitive Profile Matrix weighting seven Critical Success Factors in
order of importance and comparing the ratings for the top three current players in the SaaS e-
commerce market, GoDaddy, Inc., Shopify, Inc., and Wix, Inc. below:
Table 10 - Competitive Profile Matrix - SaaS E-Commerce Industry
Critical Success Factors Weight GoDaddy Shopify Wix

Rating Score Rating Score Rating Score
1 Brand Recognition (e- 20% 1 0.20 4 0.8 2 0.40
commerce)
2 E-Commerce 18% 2 0.36 4 0.72 3 0.54

Capabilities
3 Security and 16% 3 0.48 2 0.32 1 0.16

Reliability
4 Additional SaaS 15% 4 0.60 2 0.30 3 0.45

Business Tools
5 Price/Value 12% 4 0.48 2 0.24 3 0.36
6 Customer Service and 11% 4 0.44 3 0.33 2 0.22

Support
7 International Reach 8% 2 0.16 4 0.32 3 0.24
Totals 2.72 3.03 2.37

Weight based on importance in industry. Rating scores are based on performance of
company: 1=major weakness, 2=minor weakness, 3=minor strength, 4=major strength.
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4.2.4.1 Brand Recognition (E-Commerce)
In the larger internet industry, regardless of product, brand recognition is the most
important factor for a company to be successful. According to Drew Rhodes of Baer
Performance Marketing (2017), “Brand awareness…drives consumers’ decisions when
differentiating between competing companies.” In addition, this decision is often not made by
the customer making an objective decision between competitors based on data. A Harvard
Business School study reports that 95% of purchase decisions are made on the subconscious
level, by an emotional connection between the company/product and the customer (Zaltman,
2003). Thus, when a company plans to differentiate themselves from competitors, high brand
recognition is vital, as it can lead directly to a subconscious purchase decision.
In the SaaS e-commerce market, Shopify, the current number one player, has a
sizeable advantage in brand recognition. While GoDaddy and Wix may have advantages in
certain areas of internet technology, with GoDaddy being the world leader in domains and
Wix being a big player in the free web-hosting market, in e-commerce, Shopify is well ahead
of both of them. This can be shown objectively by reviewing the data from Google Trends, a
research service that shows the relative frequency of how often different terms are searched
for using Google, the world’s most used internet search engine. As shown in the figure below,
by comparing the trends of users searching for the company name along with the term “e-
commerce,” Shopify is clearly ahead of both GoDaddy and Wix in overall recognition in the
e-commerce space (Google Trends, 2021).
Figure 15 - Google Trends for [company] + "e-commerce"

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Shopify’s brand recognition is over twice as high as the nearest competitor, Wix, and
thus receives a rating of four (Major Strength) on the Competitive Profile Matrix. Wix cannot
count its e-commerce recognition as a strength, but it is still higher than GoDaddy’s, so they
received a rating of two (Minor Weakness). GoDaddy, although the number two company in
the market in terms of revenue, is by far the lowest in brand recognition (its position is due to
its related verticals of domains and web hosting contributing to up-selling to existing
customers) and received a rating of one (Major Weakness).
4.2.4.2 E-Commerce Capabilities
In order to compete in the SaaS e-commerce market, a company’s software platform
that they offer as a service needs to have a complete set of capabilities for merchants to use
when they set up and utilize the store features of the product. All three of the companies in
this Competitive Profile Matrix offer the most important aspects of an online store for their
merchants with their proprietary products: customizable product lists and pages, proprietary
payment processors, dropshipping (setting up a store where, when a customer places an order,
the merchant orders from a third-party vendor and manages the shipping to the customer
rather than warehousing their own inventory), integration with larger e-marketplaces like
Amazon and Ebay, and Point-of-Sale (POS) systems, so merchants can process orders in
person by credit card if they set up a physical store or visit a trade show (Threlfall, 2021).
The differentiation in the companies then must focus on the amount of customization
and add-ons, or “plugins,” that are available to the merchant as they set up and utilize their
store. Once again, Shopify as the market leader has the largest advantage in this Critical
Success Factor. The Shopify App store has over 6,000 publicly available plugins, developed
either by Shopify or independent developers, that merchants can use on either a free or paid-
use basis. While the average merchant uses an average of six plugins to run their individual
business, the level of customization is quite high. One drawback for developers of paid apps
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previously for the Shopify store was that Shopify would take 20% of the apps paid revenue as
a fee, similar to the Apple App Store, which takes a 30% fee. However, this fee was waived
for the first $1 million of revenue per year in June 2021, and a lower 15% fee for any revenue
above $1 million, which will spur developer interest in the Shopify App Store (Perez, 2021).
The strength of this App Store merits Shopify’s rating of four (Major Strength).
The Wix App Marketplace also has a large number of customizations, with around
300 native plugins at the time of this report. While it also includes free and paid plugins, Wix
apps are designed and managed in-house by Wix, Inc.; outside developers are not able to
market their own plugins on the Wix platform, which makes it less open than Shopify’s store
(Wix, Inc., 2021). However, Wix recently released a “no-code app builder” product which
gives them some additional differentiation; merchants can create their own branded app on
the Apple iOS or Google Play App Stores using the store already established on their website.
This product, while branded as “no code needed,” still requires a moderate-to-high technical
knowledge and a high monthly fee of $200 per month (Silberling, 2021). This merits Wix a
rating of three (Minor Strength) in this factor.
GoDaddy’s differentiation in this space must be split between the customizations
available for its Managed WordPress e-commerce plans and its proprietary GoDaddy Store
Builder. While WordPress/WooCommerce app stores are open-source and available to any
hosting service offering WordPress hosting, GoDaddy has been purchasing WooCommerce
plugin developers to help it gain revenue share by selling those plugins on the open
WordPress marketplace; however, this is not a differentiator for their products, merely a
revenue stream (Miller, 2020). For its proprietary GoDaddy Store Builder, which is the direct
competitor to Shopify and Wix in terms of SaaS, the GoDaddy product does not currently
have an app or plugin store to add customizations. The main differentiator of GoDaddy’s
Store Builder is that it is perceived as the “easiest” store to set up; however, it is known for its
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limited customization (Young, et al., 2021). While this can be an attractive proposition for
new merchants or those with limited technical knowledge, compared to Shopify and Wix the
rating for GoDaddy in this Critical Success Factor is two (Minor Weakness).
4.2.4.3 Security and Reliability
Two of the most important factors for any SaaS product on the internet are security
and reliability. Security refers to the safety of customer data (personal information, financial
information, inventory records, etc.) stored on the platform. Reliability refers mostly to
“uptime,” or the amount of time that the website/platform is accessible to customers. Time
where the website is not available due to infrastructure error, platform upgrades, or other
mistakes by the company is referred to as “downtime.”
While all major internet companies make an effort to keep their platforms as secure as
possible, none of the competitors in this matrix can be rated a four (Major Strength) in this
factor due to recent data breaches at GoDaddy (Winder, 2020) and Shopify (Whittaker,
2020), as well as a security flaw on the Wix platform that potentially compromised merchant
data and customer information (Osborne, 2016). As such, to properly rate the competitors,
one must look at the differences in reliability for each platform.
GoDaddy is rated the strongest of the three competitors at three (Minor Strength).
They offer 99.9% uptime, which is a standard for the industry as a whole (Websitesetup
Editorial, 2020). The differentiation is around GoDaddy’s Terms of Service (TOS). Out of the
three competitors in this study, GoDaddy is the only provider to offer a “Service Uptime
Guarantee” in their TOS that provides the customer with a credit of 5% of their monthly bill
should GoDaddy not meet its guarantee of 99.9% uptime (GoDaddy, Inc., 2021).
Shopify advertises 99.99% uptime for its services (Shopify, Inc., 2021), which is the
gold standard of the industry, but specifically does not guarantee this in its Terms of Service,
stating “Service is ‘as-is’ so it may have errors or interruptions and we provide no warranties
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and our liability is limited” (Shopify, Inc., 2021). Wix advertises a 99.8% uptime rate, which
sounds very positive to a non-technical person, but is actually substandard for the industry;
they also do not guarantee that rate in their Terms of Service (Wix, Inc., 2021). In the forced
ranking, this data rates Shopify as two (Minor Weakness) and Wix as one (Major Weakness).
4.2.4.4 Additional SaaS Business Tools
New businesses starting out in the e-commerce space must look closely at their
requirements for their business; only having an online store platform is not enough. The
Barclays Research (2021) Customer Roadmap presented earlier for potential e-commerce
merchants to use as they build their new online business is expanded to extra detail in the
figure below:
Figure 16 – Detailed Customer Roadmap for E-Commerce Merchants (Young, et al., 2021)
All three competitors in this competitive profile offer all the features in the upper
boxes (Basic Infrastructure/Plumbing and Add-Ons for Website), though Shopify and Wix
assist their customers with registering domains through third-party services integrated into
their service, and GoDaddy has their own domain registry. The differentiation comes in the
“Add-Ons for my Business.” While all three offer some version of the “External Tools” as
part of their e-commerce offering, GoDaddy is the only company out of the three that offer
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any Internal Tools for an e-commerce business, supporting the business operation as a whole
rather than only the e-commerce aspect (GoDaddy, Inc., 2021). This earns GoDaddy the
rating of four (Major Strength) in this factor. While Shopify and Wix both offer marketing
and Search Engine Optimization (SEO) tools as part of their external plugins, Wix offers an
email service (through Gmail) as an addon, allowing the merchant to keep billing in a central
location; Shopify does not offer any email services at all, and requires the merchant to
purchase/setup their own external email system to connect to the Shopify service. As such,
Wix is rated three (Minor Strength) and Shopify is rated two (Minor Weakness) in this factor.
4.2.4.5 Price/Value
As mentioned in the Porter’s Five Forces analysis of the SaaS e-commerce industry,
the Bargaining Power of Buyers revolves around the price-consciousness of small businesses
and their need for perceived value in their purchase of a SaaS web service for their business.
To rate this factor between the three competitors, this report uses a combination of metrics,
including transaction fees for payment systems, subscription prices for the e-commerce plans
of the companies, and any extra charges or limitations on the plan passed on to merchants.
When a customer uses a proprietary payment system of one of the companies, and
buys a product with a credit or debit card (the most common form of online transaction), the
payment system takes a percentage of the price as a transaction fee. The average transaction
fee for such a purchase in the United States market is 2.9% of the price, plus an additional
$0.30 (WPBeginner Editorial Staff, 2021). All three competitors offer the same transaction
fee for most purchases. Shopify and Wix charge smaller fees (1.9%) in Europe where the
lower rate is mandated; GoDaddy does not yet offer proprietary payments in Europe.
Monthly subscription fees for the hosting/e-commerce service are often the very first
pricing structure that the merchant sees when they are establishing their online presence; this
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is a major attractiveness factor when choosing objectively between options. The following is
a side-by-side comparison of the pricing structures of each company’s e-commerce plans:
Table 11 - Comparison of E-Commerce Plan Monthly Subscription Prices
GoDaddy Shopify Wix

Least expensive e-commerce plan $24.99/mo $29.99/mo $17.00/mo
Most expensive e-commerce plan $26.99/mo $299/mo $35/mo

(before plugins)
Prices listed assume merchant signs a renewed 12-month contract – month-by-month
pricing is generally higher by 5-20%, and first year prices for GoDaddy are 30-40% less..
While Wix offers the cheapest monthly plan to begin an e-commerce store, it also
comes with a large number of restrictions; specifically that the merchant has limited storage
to host data regarding its products/services, limited advertising/video streaming capability,
and more importantly, a limit to the number of transactions a merchant can process each
month using dropshipping or automated sales tax calculation; this plan is not meant for
sustainable businesses, but rather a small business beginning their journey into e-commerce;
they would be expected to then upgrade to a more expensive plan to get more options (Wix,
Inc., 2021). GoDaddy’s first-tier e-commerce plan with GoDaddy Store Builder includes
enough options for a merchant to run a permanent store without the need to upgrade, and as it
is cheaper than the first-level Shopify plan, is rated four (Major Strength) in this factor
(GoDaddy, Inc., 2021).
Shopify is also the only company among the three to charge extra fees if merchants
choose to use a third-party payment processor rather than Shopify Payments; for example, a
merchant may already have a relationship or a corporate rate with a direct bank or payment
processor such as Stripe. If a merchant wishes to integrate this method into Shopify, however,
they will pay an extra transaction fee (on top of the 2.9% + $0.30) for the privilege. This
extra fee ranges from 0.5% to 2%, depending on the subscription plan – for example, for
higher-volume businesses on the high-level $299/month Shopify plan, their extra transaction
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fee is only 0.5% (Shopify, Inc., 2021). As an additional negative point, this extra transaction
fee is charged even when a merchant sets up a store in a country that is not eligible for
Shopify’s proprietary payment system (such as the Philippines). With this in mind, Shopify is
rated two (Minor Weakness) and Wix is rated three (Minor Strength), as Wix does not have a
similar “extra” fee structure and thus provide a greater price/value advantage to merchants.
4.2.4.6 Customer Service and Support
It can be rather difficult to get a true rating of customer satisfaction for an online
business when analyzing performance outside of internal records. Any press releases issued
by the company are often tilted in their favor, and ratings from organizations such as the
Better Business Bureau (BBB) are not based on customer reviews and satisfaction, but rather
the number of complaints and published resolutions of those complain; this measures
resolution rate, but not overall satisfaction (Better Business Bureau, 2021).
Internet service companies can be rated instead using third-party ratings sites that
amalgamate reviews from direct and external sources and provide a comprehensive rating.
One of the largest providers of this service is TrustPilot, which is a major name in the online
ratings field, and rates companies from 1 (lowest) to 5 (highest). However, even TrustPilot’s
ratings can be subjected to “trolling,” or a small group of users utilizing different methods to
“bomb” a company’s rating with overwhelmingly negative reviews in order to reduce the
overall satisfaction rating (Sanfilippo, Yang, & Fichman, 2017). This is especially prevalent
with sites that offer free services, such as Wix, which has a free website builder; as the
customer base is not limited to business owners, anyone can build a free website and choose
to leave a negative review if they discover they would then need to pay for extra options.
To account for this, this report creates an adjusted weighted rating for each company
by using the collected TrustPilot scores for each company, using only the total ratings from 2
to 5 – unsatisfied business customers can be accurately counted by the number of 2 ratings,

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and provide a clearer comparison between the three competitors. This weighted rating is
shown in the table below:
Table 12 - Weighted Customer Satisfaction Ratings (TrustPilot)
GoDaddy Shopify Wix

Weighted Rating 4.714 4.062 3.938
This shows that as the top three players in the SaaS e-commerce industry, each
company has a positive customer satisfaction score; GoDaddy is clearly the top scorer. As
such, we can rate GoDaddy on this factor as four (Major Strength), Shopify as three (Minor
Strength), and Wix as two (Minor Weakness), as it is slightly less than its two competitors.
4.2.4.7 International Reach
The last factor in the Competitive Profile Matrix is International Reach of the
company and its products. All three of the store subscription products are available
worldwide – anyone around the world can create an online store with these companies. All
three also provide extensive customer support, with multiple languages available, live
chat/email support, and international phone numbers in 125-190 countries.
The differentiation in this factor is based on the reach of each company’s proprietary
payments system, i.e. GoDaddy Payments, Shopify Pay, and Wix Payments. Shopify Pay is
the leader in this field, available to be used by merchants in 17 countries around the world
(mostly in North America, Europe, and Asian countries such as Japan, Singapore, and Hong
Kong). Wix Payments is available in 14 countries, slightly less than Shopify (but also
including Israel, where Wix was founded, and which has a growing tech industry). Thus,
Shopify can be rated four (Major Strength) and Wix as three (Minor Strength) for this factor.
GoDaddy Payments is currently only available to merchants in the United States, and
not yet available internationally (GoDaddy, Inc., 2021). While this would seem like a Major
Weakness, it can only be considered a minor weakness due to the strength and scope of the
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American e-commerce industry compared to those of other countries, as illustrated in the
figure below:
Figure 17 - Estimated E-commerce sales by country for 2021 (Oberlo)
Excluding China (in which none of the competitors are allowed to operate e-
commerce businesses due to strict Chinese policies restricting e-commerce to domestic firms
such as Alibaba and Tencent, and is excluded completely from this report), the United States
is by far the largest e-commerce market in the world, with an estimated $843.15 billion in
sales for 2021. The next largest market, the United Kingdom, is only estimated to have
$169.02 billion in sales for 2021 (Oberlo, 2021). As such, GoDaddy’s current limitation to
only the American market for its payment system can be rated as two (Minor Weakness).
4.2.4.8 Conclusion
Upon calculating the weighted scores for each of the three companies in each Critical
Success Factor, one can see that Shopify has the highest score at 3.03, GoDaddy the next
highest at 2.72, and Wix in third place with 2.37, which is an accurate representation of each
company’s current position within the market in terms of overall performance, using total
revenue in SaaS/e-commerce products to measure market share within the industry.
4.3 External Factor Evaluation (EFE) Matrix
By reviewing the various external factors, including global opportunities and threats,
we can develop an External Factor Evaluation (EFE) Matrix with these factors, weighting
GODADDY, INC. 69
them as to their importance/impact on the company, and rating GoDaddy’s response to the
different factors with their current structure and strategy, as presented below:
Table 13 - External Forces Evaluation (EFE) Matrix
Opportunity Weight Rating Weighted Score

1 Growth of global e-commerce 0.20 2 0.40
industry
2 Growth of global web-hosting 0.13 4 0.52

industry
3 Cost of cloud infrastructure 0.08 3 0.24
4 Customers prefer to shop on 0.07 4 0.28

larger e-marketplaces
5 Technology to streamline e- 0.06 3 0.18

commerce constantly
improving
Threat Weight Rating Weighted Score

1 Competition from fellow SaaS 0.16 2 0.32
platform providers
2 Competition from open-source 0.10 3 0.30

software packages
3 Cybersecurity 0.08 2 0.16
4 Increasingly strict data privacy 0.07 4 0.28

regulations
5 International differences in 0.05 3 0.05

VAT/sales taxes
Total Weighted
Score:
2.83
Rating scores are based on company’s response to opportunity/threat: 1=poor, 2=average,
3=above average, 4=superior.
4.3.1 Opportunity Ratings
4.3.1.1 Growth of global e-commerce industry
While GoDaddy is currently dedicated to growing their e-commerce business, the
actual products that they provide, such as GoDaddy Store Builder and GoDaddy Payments,
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are not quite as mature or reach as many potential customers as the top competitor in the
industry. As such, their response to this factor is currently rated 2 (Average).
4.3.1.2 Growth of global web-hosting industry
GoDaddy is an established leader in the web-hosting industry, stemming from their
market dominance in the domain name industry (Grand View Research, 2020). While they do
not compete with the larger cloud infrastructure services such as Google Cloud or Amazon
Web Services, GoDaddy is a natural choice for individuals and small businesses; it is simple
to register a domain and establish web-hosting with the same company on the same bill. As
such, GoDaddy is well situated to take advantage of the continuing growth of the web-
hosting industry, and their response to this factor is rated 4 (Superior).
4.3.1.3 Cost of cloud infrastructure
GoDaddy announced in 2018 that they would be migrating the vast majority of its
infrastructure onto the cloud in a multi-year agreement with Amazon Web Services
(BusinessWire, 2018). However, as of 2020, the migration is not yet complete, as GoDaddy
still has a wholly-owned and operated data center in Arizona, USA, as well as leasing
multiple data centers from third-party vendors in the USA, Europe, and APAC. GoDaddy
does not plan to divest itself of 100% of these data centers and leases until at least 2033 due
to existing contracts and agreements (GoDaddy, Inc., 2021). As such, GoDaddy’s response to
the rise of cloud infrastructure is rated 3 (Above Average).
4.3.1.4 Customers preferring to shop on larger e-marketplaces
Leveraging the aforementioned preference of customers to use larger e-marketplaces
due to ease of shopping, loyalty points, and more, GoDaddy has made integrating its
merchants’ stores into the larger Marketplaces easy, through a dedicated plugin on the
GoDaddy Store Builder. In addition, merchants are also able to integrate into smaller,
GODADDY, INC. 71
regional e-marketplaces that are better suited for their location, such as Lazada and Shopee
(GoDaddy, Inc., 2021). As such, GoDaddy’s response to this factor is rated 4 (Superior).
4.3.1.5 Technology to streamline e-commerce constantly improving
As one of the largest companies in the industry, GoDaddy has the budget and
capability to invest heavily in Research and Development, with US $560 million spent in
2020 (GoDaddy, Inc., 2021); they are also investing in acquiring smaller technology
companies to improve their technology and product offerings, such as the 2020 acquisition of
SkyVerge (Rice, 2020). However, even with this level of investment, GoDaddy has not yet
developed any “unicorn” technology to drastically impact the industry or its competitors. As
such, GoDaddy’s response to technological developments is 3 (Above Average).
4.3.2 Threat Ratings
4.3.2.1 Competition from fellow SaaS platform providers
Although the SaaS for e-commerce market is growing rapidly, there is still direct
competition between the leading players. While GoDaddy was the dominant player in the
industry in 2018, with the growth of e-commerce as a whole, Shopify overcame GoDaddy in
both total e-commerce revenue and market share in the SaaS industry between 2018 and
2020, and by the end of 2021 is projected to be ahead of GoDaddy (now the number two
player) by over $2 billion in e-commerce revenue (Young, et al., 2021). However, all of the
other main competitors in the space (Wix, SquareSpace, BigCommerce, etc.) have also been
affected by Shopify’s growth, so GoDaddy is rated 2 (Average) for its response to this factor.
4.3.2.2 Competition from open-source software packages
As previously mentioned, open-source e-commerce packages such as
WordPress/WooCommerce are also used by merchants for e-commerce, but attract more
technically-savvy business owners than the SaaS e-commerce products. GoDaddy is in a
unique position regarding this competition; on top of providing their own proprietary
GODADDY, INC. 72
GoDaddy Store Builder, they also provide a service called “Managed WordPress Hosting”
which includes the free WooCommerce plugin as well as premium WooCommerce add-ons
exclusive to GoDaddy (Rice, 2020). Thus, they can gain revenue from merchants who prefer
open-source solutions, as well as offering their own, more streamlined Store Builder product.
No other competitors in the industry offer this option to their customers. However, this split
focus on GoDaddy’s part, including spending considerable amounts of money on WordPress-
linked acquisitions, does seem to detract from producing significant improvements or
upgrades to their proprietary e-commerce software. As such, instead of being rated Superior,
we have rated GoDaddy’s response to open-source competition as 3 (Above Average).
4.3.2.3 Cybersecurity
Hacks and data breaches are unfortunately commonplace in the tech industry, and
GoDaddy is no exception. Their rate of security problems is similar to their closest
competition. Both GoDaddy (Winder, 2020) and Shopify (Whittaker, 2020) experienced data
breaches in 2020. Wix is slightly better, with their last significant security breach in 2016
(Osborne, 2016), but in general, all competitors in this market are vulnerable to security
flaws, from internal and external sources. As such, GoDaddy’s response is rated 2 (Average).
4.3.2.4 Increasingly strict data privacy regulations
GoDaddy has an extremely proactive approach to data privacy globally. In order to
prevent any liability on the part of the company or its customers, it is very clear in its
adherence to and procedures for complying with the European GDPR, including a detailed
Data Addendum to their Universal Terms of Service (GoDaddy, Inc., 2020) and providing a
detailed Frequently Asked Questions (FAQ) guide for its customers on its help site
(GoDaddy, Inc., 2021). As such, GoDaddy is rated 4 (Superior) for its response to this factor.
GODADDY, INC. 73
4.3.2.5 International differences in VAT/sales taxes
GoDaddy is able to assist its merchants with sales tax issues in the United States,
calculating the differing tax rates in various states and cities due to the variances in American
law. However, they are not yet able to assist with international VAT rules on its proprietary
systems, as their GoDaddy Payments product has not yet been expanded outside the United
States market. This is comparable to other companies as they continue to expand the reach of
their respective payment products, though GoDaddy notes that they are making preparations
to be 100% compliant when they do release their payments products abroad (GoDaddy, Inc.,
2021). As such, GoDaddy’s response to this factor is rated 3 (Above Average).
4.3.3 Evaluation of Total Weighted Score
Upon calculating the total weighted score of all of the relevant external factors and
GoDaddy’s response to them, the total weighted score of 2.83 indicates that GoDaddy is
currently above average in its responses to external factors as a whole, compared to the actual
environment. However, it will need to take a close look at those responses, as well as the
internal analysis of GoDaddy’s operations, to determine how it will be able to continue
competing with the growth of rivals such as Shopify.
5. Internal Analysis
5.1 Organizational Diagnosis
An internal analysis of GoDaddy, Inc. should begin with an organizational audit of its
different functional areas, including management, marketing, finance, operations, research &
development, and management information systems, to find any immediate areas for targeted
improvement. Once the functional audits are completed along with an analysis of the
company’s value chain, a better picture of the company’s current internal position can be
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visualized using strategic management tools leading into an Internal Factor Evaluation,
showing how well the company is performing based on its internal strengths and weaknesses.
5.1.1 Management Audit
Table 14 - Management Audit for GoDaddy, Inc.
Audit Question Assessment Evidence

1. Does GoDaddy use strategic- YES GoDaddy conducts an annual internal
management concepts? and external audit, and reveals parts of
its strategic thinking as part of its
Annual Report to investors, in addition
to its regulatory SEC filing
requirement.
2. Are the objectives and goals NO As noted on the Vision and Mission
measurable and well- statements, the objectives and goals for
communicated? GoDaddy are not currently well-defined
other than to “radically shift the global
economy toward independent
entrepreneurial ventures.”
3. Do managers at all hierarchical YES GoDaddy has open and transparent

levels plan effectively? planning visible to all levels of
employees through its internal
communications.
4. Do managers delegate NO While 84% of employees approve of

authority well? executive team, employee reviews refer
to some dissatisfaction with line
management; there are current
initiatives to increase quality of
manager training.
5. Is the organization’s structure YES Chief Financial Officer, Chief

appropriate? Technology Officer, and Chief People
Officer report to CEO Aman Bhutani,
along with Presidents of Commerce,
Experiences, Care & Services,
International Business, and Regional
Presidents.
6. Are job descriptions and job YES Careers page at careers.godaddy.com

specifications clear? has clear, descriptive, and detailed job
descriptions and specifications for each
role, including experience needed,
location, and where the role fits in the
organization.
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7. Is employee morale high? YES Strong employee ratings on Glassdoor
(online corporate satisfaction ratings
system) and recent 2021 awards for
Diversity, Compensation, and
Engineering among large companies in
the USA.
8. Are employee turnover and YES GoDaddy is rated A (top 10%) in

absenteeism low? employee retention among top tech
companies based on current score on
Comparably, a company rating tool
(2021).
9. Are organizational reward and YES GoDaddy received 2021 award for Best
control mechanisms effective? Perks and Benefits for employees, and
83% of employees state they receive
valuable feedback from their manager
at least monthly. (Comparably, 2021)
5.1.1.1 STRENGTH: Satisfied and diverse employee base
During the decade of the 2000s, GoDaddy had a very negative reputation in the
diversity space, with sexist ads featuring scantily dressed women and questionable situations.
The inner workings of the company had a similar reputation, with a very masculine-oriented
culture and very little diversity in upper management. With the retirement of founder Bob
Parsons as CEO in 2012 and the introduction of a new management team, a strong focus was
placed on diversity, equality, and inclusion (DEI) both within GoDaddy and outside through
its brand (Metz, 2015). That has continued in full force until present day; the current CEO of
GoDaddy, Inc., Amanpal “Aman” S. Bhutani, was born and educated in India, and over 25%
of the executive team of GoDaddy is female, which is an impressive number for the
technology industry (The Org, 2021). The executive team has made it a priority to focus on
DEI initiatives, as reflected by the multiple awards won by GoDaddy since 2019 alone in this
area, presented in the table below:

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Table 15 - GoDaddy, Inc. Diversity-Related Awards, 2019-2021
Year Presented by Award

2021 Comparably Best CEO for Diversity
2021 Forbes Best Employers for Women
2021 Forbes America’s Best Employers for Diversity
2020 Human Rights Campaign Best Places to Work for LGBTQ Equality
2019 Comparably Best CEO for Women
2019 Stevie Awards Award for Women in Business

Sourced from GoDaddy Newsroom “Awards and Honors” (2021).
Employee satisfaction is also important for GoDaddy, as it is for most technology
companies presently due to the shortage of qualified and skilled software engineers in the
global labor market (da Costa, 2019). Unlike some industries where jobs are limited, workers
can very easily move to different companies within the technology sector, often for a higher
salary, especially since the COVID-19 pandemic allowed most engineers to work remotely
from home. GoDaddy has managed, however, to maintain a very positive satisfaction rate
among its employees, with an “A” rating (top 10%) on Comparably (2021) and a 4.1/5.0
satisfaction rating on Glassdoor (2021), two of the top employee-rating sites for tech
companies on the Internet. This positive employee experience can help GoDaddy maintain a
high level of service and maintain its forward motion in improving its internal products and
services. GoDaddy also has a very impressive retention rate among non-engineering roles; in
their latest Annual Report (2021) GoDaddy noted that approximately 44% of the 6,300
GoDaddy Guides employed by the company had been employed for at least three years.
5.1.1.2 STRENGTH: Corporate focus on e-commerce
As noted in the Vision and Mission statement section of this paper, GoDaddy, Inc. has
made a conscious and devoted effort to shift their focus fully to e-commerce instead of a
scattershot program of promoting their various other verticals (such as domains). This push is
GODADDY, INC. 77
even evident on the main page of godaddy.com, which is the first point of contact for most
customers looking into the products and services of the company:
Figure 18 - Main header of GoDaddy.com - October 2021
While the strategic goals still need to be refined and defined more clearly in the
Vision and Mission statements as recommended in the previous sections, the corporate focus
on e-commerce as reflected by the website branding, communications from corporate
spokespeople, and personal messages from CEO Bhutani in the Annual Report to
shareholders (2021), shows that GoDaddy has correctly identified e-commerce as the sector
of its business that has the largest and fastest growth potential in the near to mid future, and
suggests a leadership team that is keen to take advantages of the internal strengths of
GoDaddy to help accomplish this growth.
5.1.2 Marketing Audit
Table 16 - Marketing Audit for GoDaddy, Inc.

1. Are markets segmented NO Management structure and advertising
effectively? is not clearly segmented between
domains and SaaS; geographical
markets are segmented effectively,
however, with localized campaigns for
markets such as India and the
Philippines.
2. Is the organization well- YES Second largest company in terms of

positioned among revenue, largest employee based of the
competitors? top 5 competitors in the SaaS e-
commerce platform market.
GODADDY, INC. 78

3. Has the firm’s market NO GoDaddy has been losing market
share been increasing? share to Shopify and other competitors
since 2017.
4. Are present channels of YES Services are provided over the Internet
distribution reliable and cost and telephone (customer service).
effective?
5. Does the firm conduct YES GoDaddy conducts “focused and

market research? metric-driven direct response
marketing to acquire new customers”
through market research (GoDaddy,
Inc., 2021).
6. Is customer service good? YES GoDaddy has the highest TrustPilot

rating out of the Top 3 competitors in
the SaaS e-commerce platform market.
7. Are the firm’s products YES GoDaddy’s prices are better than or
and services priced comparable to competitors, though
appropriately? renewal price after a 1 year contract is
often higher for customers.
8. Does the firm have an NO GoDaddy traditionally has “strange”

effective promotion, promotion/advertising strategies, and
advertising, and publicity has lower brand awareness in the e-
strategy? commerce sphere than Shopify or Wix.
9. Are marketing, planning, NO Marketing, while still retaining and

and budgeting effective? acquiring new customers, is not
effective at gaining market share in
similar numbers to competitors;
budget is stagnant compared to
revenue.
10. Do the firm’s marketing YES Fara Howard, Chief Marketing Officer
managers have adequate for GoDaddy, has 20 years of
experience and training? experience in global marketing, 15 in
technology, including for Amazon and
Dell (LinkedIn, 2021).
11. Is the firm’s Internet YES For all intents and purposes, GoDaddy
presence excellent as is one of the backbones of the Internet
compared to rivals? as the #1 registrar of Internet domain
names globally.
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5.1.2.1 STRENGTH: Cost-effectiveness/price of products offered
Due to its large corporate size compared to most competitors in the space, its
profitable and healthy financial position (to be discussed in the following section), and its
established history, GoDaddy has the ability to be extremely competitive with its pricing
compared to other SaaS e-commerce platform providers.
The Competitive Profile Matrix previously presented showed the current
competitiveness of GoDaddy’s e-commerce plans compared to its top two competitors. While
GoDaddy does need to improve on reducing the total number of plan offerings to customers
to prevent confusion, the price points are all well within the competitive range of the industry.
In addition to this, GoDaddy recently announced a new campaign for their proprietary
payments system, GoDaddy Payments, where merchants who purchase GoDaddy’s physical
point-of-sale (POS) terminal for handling credit card transactions in person through GoDaddy
Payments will be able to avail of the lowest transaction fee currently available in the United
States: 2.3% + 0 cents, and will also be able to avail of the 2.3% transaction fee, plus 30
cents, for all online payments going through the merchant’s online store (FinExtra, 2021).
While the cost of the POS card readers and terminals ($49 and $249) somewhat limit
the value of the campaign to larger merchants with a large number of transactions going
through their stores, it is a massive strength for GoDaddy that they have the financial power
to offer such a discount, which is 0.6% lower than any other payment processor currently on
the market in the United States.
5.1.2.2 WEAKNESS: Promoting brand in e-commerce context
As the Marketing Audit indicates, the current marketing strategy cannot be considered
effective when compared to the results of GoDaddy’s main competitors in the e-commerce
space. The CPM for GoDaddy shows that overall brand awareness for GoDaddy in the e-
commerce space is considerably lower than its top two competitors, Shopify and Wix. By
GODADDY, INC. 80
looking more closely at the most recent marketing campaigns for GoDaddy, it shows that
while the company is trying to focus on e-commerce, and has made some improvements at
the time of the writing of this paper, some parts of their campaign are missing the mark.
In early 2021 GoDaddy began a campaign called “Make A Different Future” featuring
website owners from many different backgrounds, including a rock-climber, farmer, and
bow-tie designer (GoDaddy, Inc., 2021). The campaign featured print ads and YouTube
videos about how each spokesperson was “making their future” through GoDaddy.
Figure 19 - Spokespeople for GoDaddy "Make a Different Future" Campaign
However, disregarding standard marketing practices and guidelines, the ads do not
clearly identify GoDaddy as a website host or an e-commerce platform; it is left to the viewer
to infer that GoDaddy can help with one’s business. This is unfortunately a trademark of
GoDaddy’s historical marketing strategies, using social media influencers, celebrities, and
barely-clad models to increase and boost an ephemeral “brand awareness” that is not directly
connected to any specific product or service.
In September 2021, GoDaddy unveiled a new campaign that is much more directly
targeted towards the e-commerce space, and to small businesses and entrepreneurs. The
campaign, using taglines such as “Sell Anything, Anywhere” and “Sell things that mean
something,” are directly targeted and clearly identify GoDaddy’s value proposition to the
customer. The spokesperson for the campaign is four-time Grand Slam tennis champion
GODADDY, INC. 81
Naomi Osaka, who is also launching her own online skincare product store through GoDaddy
Store Builder (GoDaddy, Inc., 2021).
While this is an improvement from previous campaigns, there are still some ads
within the campaign that fall afoul of standard digital marketing techniques for video
advertising, specifically the “Five Second Rule” for digital marketing, which states that the
digital marketer must relay their value proposition to the customer in the first five seconds of
a video, or the customer will click “skip” and not engage with the product or brand (Bulbul,
2015). A specific example in the current campaign is the video, “Secure Your Future,” which
tells a 30-second visual story of a wedding photographer. Other than briefly showing the
GoDaddy logo at the start, the story is completely unrelated to the value proposition of
GoDaddy until 23 seconds into the video, where it clarifies that GoDaddy will “Secure Your
Payments” through its payment system. Furthermore, the ad does not mention anywhere that
GoDaddy is available to be the host for an online store either; it only briefly refers to
payment security (YouTube, 2021). While this is an improvement from previous campaigns,
it is still a weakness for GoDaddy to clearly promote its brand in the context of e-commerce.
5.1.3 Finance Audit
Table 17 - Finance Audit for GoDaddy, Inc.

1. Where is the firm Strong: Profitability See Ratio Tables and Analysis
financially strong and weak Weak: Liquidity and
as indicated? Revenue Growth
(comparative)
2. Can the firm raise needed YES GoDaddy has a long history and
short-term capital? excellent corporate credit and good
relationships with short-term
lenders, though it paid all of its
short-term commitments in 2020 to
prepare for Tax Receivable
Agreement settlement.
GODADDY, INC. 82

3. Can the firm raise long- YES GoDaddy raised $800 million by
term capital through debt issuing senior notes in 2021.
and/or equity?
4. Does the firm have YES $825 million unlevered free cash
sufficient working capital? flow in 2020.
5. Are capital budgeting YES GoDaddy has an extensive financial

procedures effective? team and works with auditors and
financial firms to budget capital
effectively.
6. Are dividend payout N/A GoDaddy does not pay out

policies reasonable? dividends on its stock.
7. Does the firm have good YES Stock price is healthy and growing,
relations with its investors and recent Tax Receivable
and stockholders? Agreement returned equity to
original pre-IPO
shareholders/investors.
8. Are the firm’s financial YES Mark Mccaffrey, GoDaddy’s Chief

managers experienced and Financial Officer, spent over 20
well-trained? years at PriceWaterhouseCoopers in
the technology sector before joining
GoDaddy.
9. Is the firm’s debt situation YES GoDaddy has enough liquidity to

excellent? handle its debts and has plans to
pay down debt in succeeding years.
5.1.3.1 Horizontal Analysis
Table 18 - Balance Sheet Horizontal Analysis
(in US $ millions) 2018 2019 2020 2018 2019 2020

Current assets:
Cash and cash 932.4 1062.8 765.2 60.01% 13.99% -28.00%
equivalents
Short-term investments 18.9 23.6 0 53.66% 24.87% -100.00%
Accounts and other 26.4 30.2 41.8 43.48% 14.39% 38.41%
receivables
Registry deposits 28.3 27.2 31.1 -18.44% -3.89% 14.34%
Prepaid domain name 363.2 382.6 392.4 3.33% 5.34% 2.56%
registry fees
Prepaid expenses and 58.1 48.9 60.8 -3.01% -15.83% 24.34%
other current assets
Total current assets 1427.3 1575.3 1291.3 34.71% 10.37% -18.03%
GODADDY, INC. 83
(in US $ millions) 2018 2019 2020 2018 2019 2020

Property and equipment, net 299 258.6 257.3 0.37% -13.51% -0.50%
Operating lease assets 0 196.6 142 -27.77%
Prepaid domain registry fees, 183.6 179.3 176.1 1.55% -2.34% -1.78%
net of current position
Goodwill 2948 2976.5 3275.1 3.08% 0.97% 10.03%
Intangible assets, net 1211.5 1097.7 1255.1 -8.63% -9.39% 14.34%
Other assets 14 17.2 36 -1.41% 22.86% 109.30%
Total non-current assets 4656.1 4725.9 5141.6 -0.49% 1.50% 8.80%
TOTAL ASSETS 6083.4 6301.2 6432.9 6.01% 3.58% 2.09%
Liabilities and
stockholders' equity
(deficit)
Current liabilities:
Accounts payable 61.6 72.3 51 3.36% 17.37% -29.46%
Accrued expenses and 414.3 366 527.4 -11.78% -11.66% 44.10%
other current liabilities
Deferred revenue 1393.7 1544.4 1711.3 10.19% 10.81% 10.81%
Long-term debt 16.6 18.4 24.3 -0.60% 10.84% 32.07%
Payable pursuant to tax 0 0 0.2
receivable agreements
Total current liabilities 1886.2 2001.1 2314.2 4.17% 6.09% 15.65%
Deferred revenue, net of 623.8 654.4 725.1 4.52% 4.91% 10.80%

current portion
Long-term debt, net of 2394.2 2376.8 3090.1 -0.69% -0.73% 30.01%
current portion
Operating lease liabilities, 0 192.9 166.7 -13.58%
net of current portion
Payable pursuant to tax 174.3 175.3 0 13.92% 0.57% -100.00%
receivable agreements, net of
current portion
Other long-term liabilities 63.2 17.7 56.6 -15.73% -71.99% 219.77%
Deferred tax liabilities 117.2 100.9 92 -19.45% -13.91% -8.82%
Total non-current 3372.7 3518 4130.5 -0.25% 4.31% 17.41%
liabilities
Commitments and
contingencies
Stockholders' equity (deficit)
Preferred stock, $0.001
par value
Class A common stock, 0.2 0.2 0.2 100.00% 0.00% 0.00%
$0.001 par value
Class B common stock,
$0.001 par value
Additional paid-in capital 699.8 1003.5 1308.8 44.47% 43.40% 30.42%
Retained Earnings 164.8 -153.5 -1190.9 87.91% -193.14% 675.83%
(Accumulated Deficit)
GODADDY, INC. 84
(in US $ millions) 2018 2019 2020 2018 2019 2020

Accumulated other -72.1 -78.2 -131 -15.87% 8.46% 67.52%
comprehensive loss
Total stockholders' equity 792.7 772 -12.9 62.94% -2.61% -101.67%
(deficit) attributable to
GoDaddy Inc.
Non-controlling interests 31.8 10.1 1.1 -47.00% -68.24% -89.11%
Total stockholders' 824.5 782.1 -11.8 50.87% -5.14% -101.51%
equity (deficit)
TOTAL LIABILITIES 6083.4 6301.2 6432.9 6.01% 3.58% 2.09%
AND EQUITY
While Total Assets for GoDaddy increased 2018-2020, the value of its Current Assets
dropped in 2020 due to a lowered amount of cash and cash equivalents but a higher addition
to Goodwill. These numbers are due to both acquisitions in 2020 as well as the Tax
Receivable Agreement (TRA) settlement, discussed in the next section, which accounts for
the reduction to 0 of the “Payment pursuant to tax receivable agreements” in 2020, as well as
the 675% negative change in Accumulated Deficit in Stockholder’s Equity, as the TRA
settlement returned equity to the pre-IPO owners rather than to the stockholders as a group.
Table 19 - Income Statement Horizontal Analysis
(in US $ millions) 2018 2019 2020 2018 2019 2020

Revenue
Domains 1220.3 1351.6 1515.1 15.43% 10.76% 12.10%
Hosting and Presence 1017.6 1126.5 1200.6 20.01% 10.70% 6.58%
Business Applications 422.2 510 601 29.19% 20.80% 17.84%
Total Revenue 2660.1 2988.1 3316.7 19.19% 12.33% 11.00%
Costs and Operating Expenses
Cost of revenue (excluding 893.9 1026.8 1158.6 15.27% 14.87% 12.84%
depreciation/amortization)
Technology and 434 492.6 560.4 21.98% 13.50% 13.76%

development
Marketing and advertising 291.4 345.6 438.5 15.09% 18.60% 26.88%
Customer care 323.1 348.7 316.9 10.54% 7.92% -9.12%
General and administrative 334 362.1 323.8 18.27% 8.41% -10.58%
Restructuring charges 0 0 43.6
Depreciation and 234.1 209.7 202.7 13.75% -10.42% -3.34%
amortization
GODADDY, INC. 85
(in US $ millions) 2018 2019 2020 2018 2019 2020

Total costs and operating 2510.5 2785.5 3044.5 15.96% 10.95% 9.30%
expenses
OPERATING INCOME 149.6 202.6 272.2 123.62% 35.43% 34.35%
Interest expense -98.4 -92.1 -91.3 18.55% -6.40% -0.87%
Loss on debt extinguishment 0 -14.8 0
Tax receivable agreements 14.9 8.7 -674.7 -87.91% -41.61% -7855.17%
liability adjustment
Other income (expense), net 6.9 22 -1.6 -1.43% 218.84% -107.27%
Income (loss) before income 73 126.4 -495.4 -31.65% 73.15% -491.93%
taxes
Benefit (provision) for income 9 12 1.3 -52.38% 33.33% -89.17%
taxes
Net income (loss) 82 138.4 -494.1 -34.77% 68.78% -457.01%
Less: net income attributable to 4.9 1.4 1 44.12% -71.43% -28.57%
non-controlling interests
Net income (loss) attributable 77.1 137 -495.1 -43.48% 77.69% -461.39%
to GoDaddy Inc.
Revenue grew at a steady and measurable pace from 2018-2020, and expenses rose
proportionally, reflecting the relationship between revenue generated and cost of services
sold by GoDaddy. Marketing had a higher budget growth in 2020, the success of which will
be reflected on 2021 results once reported. General/administration costs dropped in 2020 due
to a slight restructuring in customer service, and depreciation and amortization continues to
drop year-on-year as GoDaddy completes its shift from self-owned data centers to cloud-
based support on Amazon Web Services (AWS) through 2025 (GoDaddy, Inc., 2021).
The heavy jump in loss of net income, with a -$495.1 million loss in 2020, is
attributable to the Tax Receivable Agreement (TRA) liability adjustment, a one-time
measurement that will not be factored into 2021 and beyond, as discussed in the next section.
5.1.3.2 Tax Receivable Agreement (TRA)
The most interesting aspect of GoDaddy’s financial status in 2020 was the large
impact of what is known as a Tax Receivable Agreement (TRA) settlement. A TRA is a
method for pre-IPO owners to not only retain some value for themselves upon making the
company public, but also to “supercharge” the value of the IPO; the value of the company
GODADDY, INC. 86
upon offering is based on the entire company, while certain tax assets are withheld by the
owners, changing the actual value being offered to the investors on the public market. As
Gladriel Shobe (2018) notes in the Vanderbilt Law Review:
At its simplest, a TRA is a contract between pre-IPO owners and a public company
that requires the company to pay the pre-IPO owners for the tax assets covered by the
TRA. The public company makes those payments over time, and the payments are
based on how much the tax assets actually reduce the public company’s tax liability
each year. In other words, in IPOs that use TRAs, the pre-IPO owners sell everything
to the public except for certain tax assets, and the public company ends up paying
back” the pre-IPO owners for those tax assets over time.
Figure 20 - TRAs as a percentage of overall US IPOs, 2003-2017 (Shobe, 2018)
TRAs are still not common on the stock market, although they have been growing in
popularity as more pre-IPO owners begin to see the benefits in retaining assets and being paid
for them by the company over time. GoDaddy, Inc. had its Initial Public Offering in 2015,
when TRAs were included in approximately 9% of all IPOs that year (Shobe, 2018).
GoDaddy’s financial statements show how this benefited the owners immensely,
while providing only small benefits to the company. The section in non-current liabilities on
GoDaddy’s balance sheet, “Payable pursuant to tax receivable agreements, net of current
portion,” shows that GoDaddy was paying its pre-IPO owners in excess of $170 million each
year for the tax assets still held by the pre-IPO owners, and only receiving a small liability
adjustment of 5-10% of that total each year, as noted on the income statement.
GODADDY, INC. 87
This actually helps a company’s tax situation in the few years after the IPO, as they
are using tax assets owned by other entities (the pre-IPO owners) to reduce their own tax
liability, and paying the owners over time. However, once a company grows enough to be
able to structure its own tax schema to take advantage of different corporate tax laws around
the world so that they are not liable for a large amount of tax, it becomes more profitable for
them to “settle” the TRA with the pre-IPO owners; in effect, they purchase the tax assets back
from the pre-IPO owners, take full responsibility for the tax assets on the balance sheet, and
are able to cease any future payments of revenues to the pre-IPO owners, focusing purely on
creating value for current shareholders (Holmes, 2014).
Based on GoDaddy’s own reporting, their TRA stemming from their Initial Public
Offering was set to last until 2027, which would have cost the company $1.8 billion in TRA
payments to the pre-IPO owners (PR Newswire, 2020). Instead, by creating a TRA
settlement, GoDaddy was able to pay a single-time lump sum of $850 million to the pre-IPO
owners to settle/nullify any future payments, saving over $1 billion for the company over the
next seven years (GoDaddy, Inc., 2021). This did, however, have the effect of creating a one
time net operating loss in 2020 upon the settlement, as GoDaddy needed to account for the
cash being used for the settlement - $100 million in cash, and $750 million through loans,
which is why the debt level raised significantly in 2020. However, plans are already in
motion by GoDaddy management to proactively pay down their debt using its greater
unlevered free cash flow in 2021 and beyond (GoDaddy, Inc., 2021).
These agreements are also expected by financial analysts to be settled earlier than the
contracted period, as soon as the company can take advantage of their own tax assets and
status through growth and experience (Holmes, 2014). As such, while the one-time net
operating loss may change a company’s financial ratios negatively for a year, and shock
individual investors, larger institutional investors are not surprised and this usually does not
GODADDY, INC. 88
affect the company stock price in the long run. The below figure shows the activity of the
GoDaddy, Inc. stock price on the New York Stock Exchange upon the announcement of the
TRA settlement at the end of Q1 2020 (PR Newswire, 2020). The stock price dropped
dramatically from approximately $78/share to $42/share upon the announcement and the
nervousness of retail investors, but had reclaimed all of the value within six weeks due to
institutional investors understanding the purpose of the TRA settlement and driving the value
back to its normal levels; by June 2020 GoDaddy had already exceeded the Q1 share price.
Figure 21 - GDDY Stock Price Movements Related to TRA Settlement
5.1.3.3 Vertical Analysis
Table 20 - Balance Sheet Vertical Analysis
(in US $ millions) 2018 2019 2020 2018 2019 2020

Current assets:
Cash and cash equivalents 932.4 1062.8 765.2 15.33% 16.87% 11.90%
Short-term investments 18.9 23.6 0 0.31% 0.37% 0.00%
Accounts and other 26.4 30.2 41.8 0.43% 0.48% 0.65%
receivables
Registry deposits 28.3 27.2 31.1 0.47% 0.43% 0.48%
Prepaid domain name 363.2 382.6 392.4 5.97% 6.07% 6.10%
registry fees
Prepaid expenses and other 58.1 48.9 60.8 0.96% 0.78% 0.95%
current assets
Total current assets 1427.3 1575.3 1291.3 23.46% 25.00% 20.07%
Property and equipment, net 299 258.6 257.3 4.92% 4.10% 4.00%
Operating lease assets 0 196.6 142 0.00% 3.12% 2.21%
Prepaid domain registry fees, 183.6 179.3 176.1 3.02% 2.85% 2.74%
Goodwill 2948 2976.5 3275.1 48.46% 47.24% 50.91%
Intangible assets, net 1211.5 1097.7 1255.1 19.91% 17.42% 19.51%
Other assets 14 17.2 36 0.23% 0.27% 0.56%
GODADDY, INC. 89
(in US $ millions) 2018 2019 2020 2018 2019 2020

Total non-current assets 4656.1 4725.9 5141.6 76.54% 75.00% 79.93%
TOTAL ASSETS 6083.4 6301.2 6432.9 100.00% 100.00% 100.00%
Liabilities and stockholders'

equity (deficit)
Accounts payable 61.6 72.3 51 1.01% 1.15% 0.79%
Accrued expenses and 414.3 366 527.4 6.81% 5.81% 8.20%
Deferred revenue 1393.7 1544.4 1711.3 22.91% 24.51% 26.60%
Long-term debt 16.6 18.4 24.3 0.27% 0.29% 0.38%
Payable pursuant to tax 0 0 0.2 0.00% 0.00% 0.00%
Total current liabilities 1886.2 2001.1 2314.2 31.01% 31.76% 35.97%
Deferred revenue, net of 623.8 654.4 725.1 10.25% 10.39% 11.27%

current portion
Long-term debt, net of current 2394.2 2376.8 3090.1 39.36% 37.72% 48.04%
portion
Operating lease liabilities, net 0 192.9 166.7 0.00% 3.06% 2.59%
of current portion
Payable pursuant to tax 174.3 175.3 0 2.87% 2.78% 0.00%
current portion
Other long-term liabilities 63.2 17.7 56.6 1.04% 0.28% 0.88%
Deferred tax liabilities 117.2 100.9 92 1.93% 1.60% 1.43%
Total non-current 3372.7 3518 4130.5 55.44% 55.83% 64.21%
liabilities
Commitments and
contingencies
Preferred stock, $0.001 par
value
Class A common stock, 0.2 0.2 0.2 0.00% 0.00% 0.00%
$0.001 par value
$0.001 par value
Additional paid-in capital 699.8 1003.5 1308.8 11.50% 15.93% 20.35%
Retained Earnings 164.8 -153.5 -1190.9 2.71% -2.44% -18.51%
Accumulated other -72.1 -78.2 -131 -1.19% -1.24% -2.04%
comprehensive loss
Total stockholders' equity 792.7 772 -12.9 13.03% 12.25% -0.20%
GoDaddy Inc.
Non-controlling interests 31.8 10.1 1.1 0.52% 0.16% 0.02%
Total stockholders' 824.5 782.1 -11.8 13.55% 12.41% -0.18%
equity (deficit)
TOTAL LIABILITIES 6083.4 6301.2 6432.9 100.00% 100.00% 100.00%
AND EQUITY
GODADDY, INC. 90
GoDaddy’s assets are primarily its cash and cash equivalents, and its
goodwill/intangible assets. Its intangible assets include the inherent value of its own brand
which has existed for over 20 years and is well-known throughout the Internet industry, and
its goodwill is based on its intellectual property gained from not only internal research, but
also the patents, technology, and expertise acquired after purchasing other companies over
the years. GoDaddy is known for acquiring companies it wishes to integrate into its own
products, more so than its main competitors Shopify and Wix, and thus has a reflective asset
value in its goodwill calculation. Its liabilities are almost half covered by its long-term debt,
net of the current year’s portion, at 48% of total liabilities, but that is already being addressed
in 2021 with the issuance of shorter term senior notes and will be addressed further in future
projections to allow the company more flexibility in acquisitions and growth.
Table 21 - Income Statement Vertical Analysis
(in US $ millions) 2018 2019 2020 2018 2019 2020

Revenue
Domains 1220.3 1351.6 1515.1 45.87% 45.23% 45.68%
Hosting and Presence 1017.6 1126.5 1200.6 38.25% 37.70% 36.20%
Business Applications 422.2 510 601 15.87% 17.07% 18.12%
Total Revenue 2660.1 2988.1 3316.7 100.00% 100.00% 100.00%
Cost of revenue (excluding 893.9 1026.8 1158.6 35.61% 36.86% 38.06%
Technology and 434 492.6 560.4 17.29% 17.68% 18.41%

development
Marketing and advertising 291.4 345.6 438.5 11.61% 12.41% 14.40%
Customer care 323.1 348.7 316.9 12.87% 12.52% 10.41%
General and administrative 334 362.1 323.8 13.30% 13.00% 10.64%
Restructuring charges 0 0 43.6 0.00% 0.00% 1.43%
Depreciation and 234.1 209.7 202.7 9.32% 7.53% 6.66%
amortization
Total costs and operating 2510.5 2785.5 3044.5 100.00% 100.00% 100.00%
expenses
OPERATING INCOME 149.6 202.6 272.2 5.62% 6.78% 8.21%
Interest expense -98.4 -92.1 -91.3 -8.06% -6.81% -6.03%

Loss on debt extinguishment 0 -14.8 0 0.00% -1.09% 0.00%
GODADDY, INC. 91
(in US $ millions) 2018 2019 2020 2018 2019 2020

Tax receivable agreements 14.9 8.7 -674.7 1.22% 0.64% -44.53%
Other income (expense), net 6.9 22 -1.6 0.57% 1.63% -0.11%
Income (loss) before income 73 126.4 -495.4 5.98% 9.35% -32.70%
taxes
Benefit (provision) for 9 12 1.3 0.74% 0.89% 0.09%
income taxes
Net income (loss) 82 138.4 -494.1 6.72% 10.24% -32.61%
Less: net income attributable 4.9 1.4 1 0.40% 0.10% 0.07%
to non-controlling interests
Net income (loss) 77.1 137 -495.1 2.90% 4.58% -14.93%
attributable to GoDaddy
Inc.
The revenue split between Domains and SaaS (including both Hosting and Presence
and Business Applications categories) has stayed relatively steady in the last three years at
approximately 45-46% of revenue from Domains, and 54-55% attributable to SaaS products.
While previously this was reflective of GoDaddy’s strong commitment to both verticals, as
the e-commerce industry is growing at a much faster rate overall than domains, this presents
an opportunity for GoDaddy to shift its focus more completely towards e-commerce which
can be reflected and tracked by future revenues coming more heavily from the SaaS verticals.
Historically, due to the TRA and its effect on taxable income, GoDaddy has had a
positive tax benefit with its total tax structure, of which a large portion was payable to the
pre-IPO owners as part of the TRA (Shobe, 2018). Due to its international operations and
various tax structures, GoDaddy now has a greater net benefit when calculating its tax
obligations, due to depreciation, interest, loan deductions, and assets located in different
countries with varying tax schemes, which allows it to benefit from settling the TRA
obligations. This is common in larger American technology companies; for example, most of
Facebook’s income was recorded in Ireland rather than the United States until 2021, which
gave it numerous financial reporting and income tax advantages (Kollewe, 2020).
As noted in the horizontal analysis, the heavy net loss recorded in 2020 is due to the
one time hit to operating income attributable to the TRA settlement, which was planned for
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and accounted for at the time of the IPO. This will not be an issue in financial reports from
2021 and beyond, and should show a continued growth in net income in future years.
5.1.3.4 Financial Ratios Compared with Shopify and Wix
Table 22 – Historical Liquidity Ratios for Top 3 Competitors
Company 2018 2019 2020

Current Ratios
GoDaddy 0.7567 0.7872 0.558
Shopify 15.3516 8.6675 15.6908
Wix 2.1454 1.7197 1.7848
GoDaddy seems dangerously illiquid compared to its competitors, but there are
reasons for that, and GoDaddy is more than liquid enough to meet all of its obligations and
actually divested itself of all short-term investments in 2020 as seen in the financial
statements above. GoDaddy, as a much older and more established company than Shopify or
Wix, has the size and credit to manage its liquidity with more maturity than the other two
competitors. Indeed, not only did GoDaddy have increasing unlevered free cash flow from
2018-2020, with over $825 million in 2020, they issued $800 million worth of senior notes in
2021 to gain more cash to help pay for the TRA settlement (noted in the Cash Flow
projections in Section 8.3.4 as FY 2021 was not yet complete at the time of this paper).
Figure 22 - GoDaddy, Inc. Unlevered Free Cash Flow, 2016-2020
Shopify, due to its massive growth in the market over the last few years, has pursued a
policy of not financing with debt at all, and self-funding its growth through its cash flow,
which is reflected in its high current ratio. This could also be a hedge on the part of the
GODADDY, INC. 93
company; while the company could make more money by investing its cash flow or
leveraging through debt, it chooses not to in order to both invest in further internal growth as
well as to be prepared in case of a market bubble; if they lose revenue due to a paradigm shift
in the market (new technologies, etc.), they will be prepared to weather the storm.
Wix has a traditionally healthy current ratio, striking a balance between liquidity and
using its cash flow for other purposes. While it looks healthy, it could be dangerous in the
event of changes in its market valuation, as shown in further profitability and growth ratios
below.
Table 23 - Historical Leverage Ratios for Top 3 Competitors
Company 2018 2019 2020

Long Term Debt/Capital
GoDaddy 0.7438 0.7524 1.0038
Shopify - - 0.1059
Wix 0.6901 0.634 0.7344
Debt/Equity Ratio
GoDaddy 2.924 3.0625 -263.9322
Shopify - - 0.1184
Wix 2.2264 1.7325 2.7657
The long term debt/capital ratio shows again the long and established reputation of
GoDaddy, as it is able to fund more debt than other competitors due to its large historical size
and previous performance, has plans to pay down this debt further in 2021, and will be
projected to pay off more in the following three years. Shopify, as previously noted,
historically did not finance at all through debt. However, in 2020 they issued and sold their
first-ever convertible senior notes, which are redeemable at 130% of the issue value in 2025,
or earlier if the share price reaches that level before then. With the intense growth of Shopify
stocks in the last few years, this will be reached easily and these notes, while classified as
long-term debt, should be erased by 2021 (Shopify, Inc., 2021).

GODADDY, INC. 94
GoDaddy had a standard Debt/Equity Ratio until 2020, when the Tax Receivable
Agreement settlement was initiated, which disrupted all income-based ratio measurement for
the company in 2020 by using traditional calculations. As this is a one time Net Operating
Loss, it will not be carried forward to future years, and financial analysts typically look at a
company’s performance without the TRA to calculate the “true” ratios, as TRA settlements
are already planned and announced when used to launch the company’s IPO (Holmes, 2014).
Using calculations of debt/equity without factoring in the TRA, GoDaddy’s ratio in 2020
would be 3.7155, which will improve as debt turns into profit in succeeding years (PR
Newswire, 2020).
Table 24 - Historical Profitability Ratios for Top 3 Competitors
Company 2018 2019 2020

Operating Margin
GoDaddy 5.6239% 6.7802% 8.207%
Shopify -8.5648% -8.9437% 3.0774%
Wix -5.0737% -10.5441% -19.9585%
Net Profit Margin

GoDaddy 2.8984% 4.5849% -14.9275%
Shopify -6.0148% -7.9105% 10.9066%
Wix -6.1487% -11.354% -16.7031%
Return on Equity (ROE)

GoDaddy 9.9454% 17.696% 4187.279%
Shopify -3.0875% -4.1397% 4.9918%
Wix -24.3786% -41.5954% -54.7397%
The comparative profitability ratios of the three company show GoDaddy’s strong
historical position in the market – it was the only company to have a positive Operating
Margin, Net Profit Margin, and Return on Equity in 2018 and 2019.
GoDaddy’s Net Profit Margin was negative in 2020 due to the TRA settlement, which
was recorded as -$647 million in net income. However, without accounting for the TRA,
analysts still see the actual net income for GoDaddy in 2020 as $179.6 million, which gives a
GODADDY, INC. 95
more realistic Net Profit Margin of 5.415%, which is continued growth from previous years.
The Return on Equity number of 4,187% is also reflective of the TRA settlement, where
GoDaddy is returning a vast amount of pre-identified equity to its pre-IPO owners in
exchange for release from future tax obligations, which is a net positive for the company.
Without accounting for the TRA settlement, the Return on Equity for GoDaddy can be
calculated at 21.43%, which is good steady growth from previous years as well.
Shopify, on the other hand, only became profitable beginning in 2020, despite its
heavy growth in preceding years. Its profitability ratios became positive in 2020 not
necessarily due to higher subscription growth, but rather as a result of the COVID-19
pandemic and increased Gross Merchandise Value (GMV) passing through its existing
merchants’ stores, which increased the amount of revenue Shopify could gain through
transaction fees. It remains to be seen if Shopify can keep its growth constant and profitable
after the pandemic abates; this will depend on if customers’ proclivities stay with online
shopping rather than brick-and-mortar retail post-pandemic (Shopify, Inc., 2021).
Wix is in a completely different situation from both GoDaddy or Shopify. While
GoDaddy has a long history and has a reputation for being profitable (if not as fast-growing
as competitors), and Shopify’s growth has turned it highly profitable, Wix has never had a
positive Operating Margin or Net Profit Margin, and yet it remains in business. This is a
classic “tech bubble” situation, where investors have confidence in the long-term
performance of the company and faith that it will eventually become profitable and return
their investments at high rates; this is reflected by the continuing stock price growth of these
companies despite their declared losses year-on-year. While some companies can make good
on this promise (Shopify being a perfect example), Wix’s continuing losses make it a
potentially more dangerous bet for investors. Some market analysts are already warning
about the potential for an upcoming “burst” of these bubble companies, comparable to the
GODADDY, INC. 96
historical tech bubble of the early 2000s when numerous companies with inflated values
collapsed when unable to become profitable (Tzanetos, 2021).
Table 25 - Historical Growth Ratios for Top 3 Competitors
Company 2018 2019 2020

Revenue Growth
GoDaddy 19.2% 12.3% 11.0%
Shopify 59.4% 47.0% 85.6%
Wix 41.8% 26.0% 30%
Stock Price Growth (YoY)

GoDaddy 19.79% 12.14% 22.82%
Shopify 35.22% 186.28% 185.59%
Wix 56.98% 34.22% 111.86%
The growth ratios for the three competitors show a number of things. First, GoDaddy
is slower in both growth and stock price compared to both Shopify and Wix. While this may
look alarming at first glance (and is concerning), it is somewhat explainable by the fact that
approximately half of GoDaddy’s revenue comes from the Domains vertical rather than SaaS
e-commerce development. As GoDaddy is already the dominant market player in that market,
its revenue growth is understandably slower, albeit steady and high. Shopify and Wix, on the
other hand, are solely inside the SaaS and e-commerce markets, and their revenue and stock
price growth reflect the same growth of the e-commerce industry. Nevertheless, this is a
major strategic opportunity for GoDaddy, to improve its revenue growth over the succeeding
years, which should in turn increase its stock price proportionally.
These ratios also show the “bubble” aspect of Wix more clearly as well. All three
companies showed extensive stock price growth compared to their actual revenues in 2020
because of the COVID-19 pandemic and the overall shift/confidence growth in e-commerce
as a whole. However, Wix has historically seen increases in their stock price in the last three
years that are not reflective of their actual revenue growth, and although it continues to grow,
GODADDY, INC. 97
analysts are increasingly warning that the long-term return of Wix stock is likely to be much
lower than its future growth within the SaaS e-commerce space (GF Value, 2021).
Table 26 - Historical Activity Ratios for Top 3 Competitors
Company 2018 2019 2020

Asset Turnover
GoDaddy 0.4373 0.4742 0.5156
Shopify 0.476 0.4523 0.3774
Wix 0.7147 0.6921 0.5222
Receivable Turnover
GoDaddy 100.7614 98.9437 79.3469
Shopify 8.0561 6.5566 6.9495
Wix 44.6263 44.8042 41.7727
Days Sales in Receivables

GoDaddy 3.6624 3.689 4.6001
Shopify 45.3075 55.6694 52.522
Wix 8.179 8.1466 8.7378
GoDaddy has the best receivable turnover, reflecting its long-established practices as
a company that has existed longer than both Shopify and Wix, and its relationships with both
suppliers and debtors, with about double the speed of Wix. Shopify’s receivable turnover is
significantly higher than both GoDaddy and Wix because of a merchant program called
“Shopify Capital,” where the company acts as a short-term lender to its merchants using its
SaaS services; they provide loans for payroll, inventory purchase, and marketing. This
program is recorded on its financial statement as part of “Merchant Solutions,” which is the
same line on which transaction fees are recorded, so the actual amount of revenue generated
from this program is confidential to the company and not released. However, as it is acting as
a financial institution in some aspects due to its lending to merchants, it clearly affects total
receivable time as the loans to merchants have term limits – thus Shopify shows receivable
ratios more comparable to banks than its own competitors in the SaaS e-commerce space
(Shopify, Inc., 2021).

GODADDY, INC. 98
5.1.4 Operations Audit
Table 27 - Operations Audit for GoDaddy, Inc.

1. Are supplies of raw N/A Raw materials not needed for GoDaddy’s
materials, parts, and products and services, which are software
subassemblies reliable and services provided over the Internet.
reasonable?
2. Are facilities, equipment, YES GoDaddy hubs and offices are in prime
machinery, and offices in locations for both quality of life for
good condition? employees and affordable electrical costs
(data center).
3. Are inventory-control N/A GoDaddy does not require inventory

policies and procedures control, as proprietary and third-party
effective? products are not physical. Domain name
registry is effectively controlled by data
management systems.
4. Are quality-control YES SaaS platforms can be updated and

policies and procedures patched instantly, with engineering teams
effective? constantly monitoring to ensure 99.99%
uptime. GoDaddy customer service
quality is a priority for the company,
reflected by number of employees in
customer service positions and high
TrustPilot rating.
5. Are facilities, resources, YES GoDaddy primary data center is in

and markets strategically primary US market (Arizona), employee
located? base is distributed globally to better
support international markets.
6. Does the firm have YES As a domain/SaaS company, GoDaddy is

technological competencies? on the forefront of technical progress in
Internet technology.
5.1.4.1 STRENGTH: Additional SaaS business tool set available
Operationally and historically GoDaddy has been much larger than its competitors in
both product line and revenue (until Shopify took over on the revenue side in 2019). As such,
it was seen as one of the original homes of the “business website toolset” during the dotcom
boom of the early 2000s, and has always had agreements with other large Internet companies
GODADDY, INC. 99
to bundle their business products in with GoDaddy’s offerings. Now that e-commerce is
becoming the rising star of Internet business, businesses are moving from simple “presence”
websites to complete online options – and GoDaddy is the only SaaS e-commerce platform to
also offer an entire suite of SaaS business tools for business owners and merchants.
These tools are generally outside the “e-commerce online store” suite, but are still
very useful for merchants starting their own small business, including e-mail (connected to a
GoDaddy domain, for example sales@sampleonlinestore.com), business productivity
subscriptions through Microsoft Office 365, and virtual telephony; a merchant can have a
phone number connected via the Internet to their mobile phone or computer so they can have
a unique business number without having to give out a personal number, and additionally can
use it anywhere there is Internet connectivity without long distance or international phone
charges. There are also additional marketing, advertising, security, and design tools available
for merchants that are not available on other platforms (GoDaddy, Inc., 2021).
While merchants who choose Shopify, Wix, SquareSpace, or BigCommerce as their
e-commerce platform can still purchase their own subscriptions of third-party business tools,
the fact that GoDaddy has these tools available in packages is a large advantage, as many
businesses, especially small businesses, would prefer an easy, all-in-one solution for most of
their business needs, to prevent unnecessary administration overhead (GoDaddy, Inc., 2021).
5.1.4.2 STRENGTH: Quality of customer service and support
As previously noted, fully 70% of GoDaddy’s employees are designated as GoDaddy
Guides, or customer service experts. Newly hired GoDaddy Guides spend over a month in
training and onboarding before being allowed to interact independently with customers
(GoDaddy, Inc., 2021), ensuring an incredibly satisfied customer base, as reflected by the
highest satisfaction scores among the SaaS e-commerce platform competitors on TrustPilot
(2021).
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GoDaddy Guides are also nurtured and developed throughout their career with
GoDaddy. As the company notes, “With a commitment to lifelong learning, we offer
extensive classes to our employees spanning leadership, sales, service, and technology”
(GoDaddy, Inc., 2021). The international distribution of GoDaddy Guides also allows
GoDaddy to provide seamless global support in multiple different languages.
Perhaps the biggest strength of the GoDaddy Guides, however, is their ability to
provide “real-time product suggestions while providing a world-class support experience”
(GoDaddy, Inc., 2021). In other words, Guides are able to be salespeople for the company in
addition to providing customer support. 12% of all total bookings for GoDaddy, Inc. came
from subscription sales by GoDaddy Guides. While sometimes there is pressure reported by
Guides internally regarding sales targets or quotas, the high satisfaction level of the employee
base as a whole still reflects GoDaddy’s excellent strength in this area (Nolasco, 2021).
5.1.4.3 WEAKNESS: Capabilities of proprietary product stack
Despite the strengths of GoDaddy in the realms of additional business tools and
satisfied employees, it is important to note that the actual e-commerce capabilities of their
proprietary e-commerce software, GoDaddy Store Builder, is lacking in comparison to its
main competitors. While it does have some advantages over its rivals (easier to set up than
Shopify, and the ability to export data as needed as opposed to Wix which does not allow
this), GoDaddy’s main weakness in e-commerce is the lack of a plugin-based app store on its
Store Builder platform, which allows users to add multiple customizations of design, product
display, purchase flow, and data collection (Illumination, 2021).
When a merchant selects a platform to host and operate their online storefront, they
are highly incentivized to make the storefront match their pre-existing brand (colors, design,
fonts, etc.) as much as possible, to be seamless with whatever other media they are using
(website, print materials, social media, etc.). While GoDaddy Store Builder has many visual
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customization options, it pales in comparison to the Shopify App Store with its over 6,000
unique plugins, or even Wix’s App Marketplace with over 250 plugins; GoDaddy Store
Builder currently has none, only the primary store design tool (GoDaddy, Inc., 2021).
GoDaddy has recently spent millions of dollars in acquiring companies involved in
WordPress plugin development, especially plugins around WooCommerce, the open source e-
commerce platform used within WordPress. However, the majority of these plugins cannot be
integrated into its proprietary system, but only used within the WordPress hosting plans that
GoDaddy offers. While admittedly the number of WordPress users worldwide outnumber
those merchants using SaaS e-commerce platforms, the opportunity for revenue generation
for GoDaddy will come primarily from its proprietary payments system, which can be (and
is) baked in directly to the Store Builder product. This can be addressed by focusing more on
developing this product rather than spending money on WordPress-related acquisitions, and
recommendations to accomplish this will be presented later in this paper.
5.1.4.4 WEAKNESS: Global reach of in-house e-commerce payments
While GoDaddy Payments is making great strides in terms of price savings for the
merchants and ease of use in both the Store Builder platform and as a WordPress plugin, it is
still only available to merchants who are based in the United States. This is a weakness for
GoDaddy, as its competitors’ payment systems are already available in multiple countries:
Shopify Payments is available in 17 countries, and Wix Payments is available in 14 countries.
Even WooCommerce Payments, an open-source solution from Automattic, is already
available in 10 countries, with more expected to be available soon (WooCommerce, 2021).
The reason this is not more of an urgent weakness than it seems is because the vast
majority of online e-commerce sales (outside of China) comes from the United States, with
$843.15 billion in sales in 2020; the UK was in a distant second place at $169.02 billion
(Oberlo, 2021). That being said, 32% of GoDaddy’s total subscription bookings came from
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international sales in 2020 (GoDaddy, Inc., 2021); while the volume of sales are lower, there
is a vast number of online merchants in global locations that could potentially use GoDaddy
Payments in the future; this is a blue-sky target GoDaddy should focus on reaching.
5.1.5 Research & Development Audit
Table 28 - Research & Development Audit for GoDaddy, Inc.

1. Does the firm have R&D YES Facilities are based on software
facilities? Are they engineering teams, with 1,897 software
adequate? engineers, 314 registered patents, and 102
pending patent applications in the United
States (GoDaddy, Inc., 2021).
2. If outside R&D firms are N/A
used, are they cost-
effective?
3. Are R&D resources NO R&D resources are split between domain

allocated effectively? research, WordPress technology, and
proprietary payment/site building
technology due to historical business
practices.
4. Are management YES GoDaddy is a provider of computer

information and computer systems and software to other businesses;
systems adequate? this is a primary part of its business
model.
5. Is communication YES GoDaddy is a relatively flat organization

between R&D and other as are most Internet companies, with open
organizational units and transparent communication between
effective? teams (Comparably, 2021).
6. Are present products YES GoDaddy’s SaaS platform is

technologically competitive? technologically world-class in terms of
security/speed; it is lacking in features
compared to competitors.
5.1.6 Management Information Systems Audit
Table 29 - Management Information Systems Audit for GoDaddy, Inc.

1. Do all managers in the YES System is designed for open
firm use the information communication across all divisions,
system to make decisions?
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transparency leads to all managers using
same tools.
2. Is there a Chief YES There is a Chief Technology Officer

Information Officer or (Charles Beadnall), an SVP of Global
Director of Information Platforms Development (Lofti Herzi), a
Systems position in the Senior Director of Advanced Analytics
firm? (Peter Tharaldson) and a Director of
Analytics (Sam Nagashima) who oversee
information systems (The Org, 2021).
3. Are data in the YES As an Internet-based SaaS platform

information system updated provider as well as a domain registrar,
regularly? information must be updated real-time to
conduct business effectively.
4. Do managers from all YES Communication is transparent and uses

function areas of the firm same platforms throughout the company.
contribute input to the
information system?
5. Are there effective YES Limited data breaches show effectiveness

passwords for entry into the of organizational security measures,
firm’s information system? including strong password policies,
limited access to secure systems, and
Two-Factor Authentication (2FA)
required of all employees.
6. Are strategists of the firm YES Technology officers have experience with
familiar with the rival firms and often share best practices
information systems of rival as well to ensure security in the wider
firms? industry.
7. Is the information system YES System designed for real-time input and
user-friendly? updating, along with third-party tools to
provide effortless entry/management.
8. Do all users of the YES Internet firms are also known as

information system Information Technology (IT) firms, with
understand the competitive competitive information being the
advantages that information backbone of the industry.
can provide firms?
9. Are computer-training YES Internal GoDaddy training provided to all

workshops provided for employees upon joining as part of
users of the information onboarding process, as information
system? system usage is vital to every employee
succeeding in their role.
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10. Is the firm’s information YES System must be updated as frequently as
system continually being products and services to continue
improved in content and providing service on required levels.
user-friendliness?
5.1.7 Value Chain Analysis
The Porter’s Value Chain Analysis is a tool referenced in David and David (2017) for
presenting in a visual format the chain of activities which end up with the final offering to the
customer, in order to meet a company’s strategic objectives. However, this analysis was
designed primarily for companies involving manufacturing physical products. For a company
such as GoDaddy, which is competing in the SaaS, or Software as a Service market, the
manufacturing value chain does not apply, as there are no physical products created or
offered by the company.
This paper therefore turns to the idea of the Value Chain in Service Operations
Strategy as detailed by Armistead and Clark (1992). This version of the value chain follows
the similar thought process of the Porter’s Value Chain Analysis, but allows the value chain to
be modified in order to fit the unique perspective of a service industry (whether it be software
as a service, or hospitality, for example). The general overview of the Service-oriented Value
Chain is presented below:
Figure 23 - Porter's Value Chain Analysis Adapted for Service Industry

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This shows the overall Support Strategies which assist in the success of the Primary
Activities that are the main driver of the strategic goal, or profit margin. In the Service-
oriented Value Chain, the chain itself focuses on the customer journey, or the different touch
points the customer has with the company’s product or service offering, and what the
company does during that phase to assist or respond to the customer. In the following table
the individual details for each activity are presented as it pertains to GoDaddy, Inc.:
Table 30 - Value Chain Analysis Details for GoDaddy, Inc.
Support Activity Relevant Support Details for GoDaddy, Inc.

Firm Infrastructure 20% of staff – Technology and R&D
5% - Marketing and Advertising
8% - General and Administrative
67% - Customer Service (Technical Support and Inbound Sales)
HR Management 9600 staff (6600 full-time employees in the United States and
European Union, 3000 contractors in various other countries)
Heavy internal focus on diversity and pay equity
Technology Heavy investment in R&D ($2.1 billion from 2016-2020)

Focus on product development on software side
Scalable infrastructure platform (data centers and transition to
cloud)
Procurement Acquisition focus on smaller companies with store plugins and

e-commerce tools that can be integrated into proprietary systems
(eg. Poynt, a virtual POS system acquired in 2020).
Primary Activity Relevant Steps for GoDaddy, Inc.

Inbound Logistics 1. Customer is interested in establishing online presence
2. Customer views different hosting/store options on GoDaddy
website (this can be improved – too many options makes it
difficult to choose)
3. Customer can also call GoDaddy Guides directly for personal
consultations
4. Customer signs up for plan and pays hosting/subscription fees
Operations 1. Customer sets up online store

2. Customer chooses store model/template/design
3. Customer imports product data into store database
4. Customer sets up pricing for products
5. GoDaddy ensures ease of set up with a secure/fast
infrastructure and user-friendly onboarding
program/customization guide
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Primary Activity Relevant Steps for GoDaddy, Inc.

Outbound Logistics 1. Customer uses GoDaddy system and help guides to connect to
payment processors (PayPal, Stripe, GoDaddy Payments, etc.)
2. Customer connects to shipping providers if needed (UPS,
DHL, etc.)
3. GoDaddy within software ensures that local sales tax/VAT
compliance is correct, depending on location of merchant and
prospective customer base
Marketing and Sales 1. Customer/merchant connects store to larger e-marketplaces

(Amazon, etc.)
2. GoDaddy facilitates enabling of digital marketing tools such
as plugins for email marketing, Google listings, linkages to
Facebook page of merchant, etc.)
3. GoDaddy collects/provides sales reports and analytics to
merchant (sales numbers, abandoned cart metrics, VIP users,
etc.)
Service 1. GoDaddy ensures reliability of site (security and uptime)

2. GoDaddy provides 24/7 customer service by live chat, email,
or telephone
3. GoDaddy continually communicates new changes and features
to users/merchants
5.1.8 Porter’s Generic Strategies Analysis
Porter’s Generic Strategies is a way to define corporate strategies that allow the
company to gain some type of competitive advantage in the industry (Porter, Competitive
Strategy: Techniques for Analyzing Industries and Competitors, 1980). The strategies are split
into three different areas; Cost Leadership, or providing the best price; Differentiation,
providing products that are unique to the industry; and Focus, or providing products for a
specific type of market. These strategies are subdivided again into five different types of
strategies, from providing the lowest cost, best value, most differentiation, or tailoring a focus
to a niche group by providing the best cost or value:

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Figure 24 - Porter's Generic Strategies (from David and David [2017])
5.1.8.1 WEAKNESS: Split focus between in-house products and managed open-
source
GoDaddy’s internal strategies show a clear weakness in this analysis, as their
strategies do not quite fit into any of the types listed by Porter, but rather a mix of multiple
types. While GoDaddy is beginning to shift towards providing value and cost leadership to
the “niche” market of entrepreneurs and small businesses by providing their own e-commerce
platform, they are also splitting their focus between building up their own proprietary Store
Builder product through R&D and acquisition efforts, and also continuing to build/promote
their products within the managed open-source space of WordPress. This provides a
confusing choice to a new e-commerce merchant if they look at GoDaddy for their hosting
and e-commerce needs; GoDaddy provides two different and competing options, and do not
provide a solid value proposition to choose one over the other (GoDaddy, Inc., 2021).
GoDaddy’s proprietary store product, as mentioned in the CPM, is not strong enough
to be considered a differentiator to their closest competitors, though their additional SaaS
business tool set is. Finally, the cost of their products, while slightly less than others, is not a
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major factor nor a focus of GoDaddy’s internal strategies. In his work, Porter (1980) refers to
this split focus between different competitive strategies as being “stuck in the middle.”
5.2 Internal Factor Evaluation (IFE) Matrix
By reviewing the strengths and weaknesses of the internal factors of GoDaddy, Inc. as
detailed by the Internal Audit, an Internal Factor Evaluation (IFE) Matrix can be devised to
give each strength and weakness a weight relative to its importance to the company’s
performance, a rating to highlight how strong of a strength or weakness the factor is for the
company, and provide a total weighted score which gives an insight into the overall internal
performance of the company. The proposed IFE Matrix for GoDaddy, Inc. based on the
internal factors discussed in this section is presented below:
Table 31 - Internal Factor Evaluation (IFE) Matrix
Strength Weight Rating Weighted Score

Additional SaaS business tool set available 0.15 4 0.60
Cost-effectiveness/price of products offered 0.12 4 0.48
Quality of customer service and support 0.11 4 0.44
Satisfied and diverse employee base 0.08 3 0.24
Corporate focus on e-commerce 0.05 3 0.15
Weakness Weight Rating Weighted Score

Promoting brand in e-commerce context 0.18 1 0.18
E-commerce capabilities of proprietary product stack 0.16 2 0.32
Split focus between proprietary products and 0.09 2 0.18

managed open-source
International reach of proprietary e-commerce 0.06 2 0.12

payments
Total Weighted
Score:
2.71
Rating scores are based on quality of strength/weakness: 1=major weakness, 2=minor
weakness, 3=minor strength, 4=major strength
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5.2.1 – IFE Analysis/Conclusion
Most of the factors in the IFE are also Critical Success Factors as noted in the CPM.
The factors that are not listed in the CPM are strengths or weaknesses unique to GoDaddy,
Inc., including the employee base, corporate stated focus on e-commerce, and the split focus
in strategies between its proprietary product and their managed open-source offerings. While
there are number of things that can definitely be improved upon concerning GoDaddy’s
internal operations, the IFE total weighted score of 2.71 indicates that their internal processes
and overall health is slightly above average; when one recognizes that six out of the nine
factors are also included in the CPM and rated in comparison to its nearest competitors, this
puts GoDaddy in a fairly positive light regarding its internal position.
6. Strategy Formulation
Upon completion of the analysis of the numerous external and internal factors
currently affecting GoDaddy, Inc.’s performance, one can start formulating specific strategies
to improve upon its position and meet future strategic and financial objectives. To accomplish
this, this paper turns to the collection of strategy formulation tools found in David & David
(2017) to help identify the types of strategies that GoDaddy should pursue, how effective
each type of strategy could potentially be, and finally to codify specific key strategic issues,
develop specific strategic and financial objectives for the next three years, and then
recommend specific strategies in order to achieve the stated objectives.
6.1 Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix
The first strategy formulation tool utilized in this paper takes the Strengths and
Weaknesses of GoDaddy, Inc. identified in the IFE as well as the Opportunities and Threats
identified in the EFE, numbers them, and creates the Strengths, Weaknesses, Opportunities,
and Threats Matrix, also known as the SWOT or TOWS Matrix (David & David, 2017). By
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comparing different combinations of the categories, one can propose specific suggestions to
overcome; for example, a specific weakness by utilizing an external opportunity, or using an
internal strength to defend against a specific external threat. These suggestions can then be
categorized as different types of strategies, which are counted and included in the later
Summary of Strategies that allows a researcher to choose the right type of strategies that will
be most effective for the company. The resultant recommended strategies can then be
expanded into concrete action plans and programs to align with the decided upon Strategic
and Financial objections. The SWOT/TOWS Matrix for GoDaddy is presented below:
Table 32 - SWOT/TOWS Matrix
Strengths Weaknesses
S1. Additional SaaS business tool set W1. Promoting brand in e-commerce
available context
S2. Cost-effectiveness/price of products W2. E-Commerce capabilities of proprietary

offered product stack
S3. Quality of customer service and support W3. Split focus between proprietary
products and managed open-source
S4. Satisfied and diverse employee base W4. International reach of proprietary e-
commerce payments
S5. Corporate focus on e-commerce
Opportunities Threats
O1. Growth of global e-commerce industry T1. Competition from fellow SaaS platform
providers
O2. Growth of global web hosting industry T2. Competition from open-source software
packages
O3. Cost of cloud infrastructure becoming T3. Cybersecurity – hacks/dataleaks

cheaper/easier to scale than data centers becoming more sophisticated
O4. Customers prefer to shop on larger e- T4. Increasingly strict data privacy
marketplaces regulations
O5. Technology to streamline e-commerce T5. International differences in VAT/sales

constantly improving taxes
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6.1.1 S-O Strategies
The following section summarize recommendations to improve GoDaddy’s
performance based on leveraging internal strengths to take advantage of external
opportunities in the market. The specific strength or opportunity from the SWOT/TOWS
Matrix is identified by the code at the end of the subheading.
6.1.1.1 Promote “all-in-one” online business package (S1-O1-O2)
By leveraging GoDaddy’s expansive product/tool set outside the “online store”
product offered by competitors, GoDaddy can take advantage of the growth of both e-
commerce and web hosting across the globe.
6.1.1.2 Offer discounts on hosting plans based on GMV (S2-O1-O2)
GoDaddy can increase the attractiveness of its products to pure merchants, and not
just hybrid website owners who eventually build a store, by offering discounts on hosting and
store plans based on Gross Merchandise Value (GMV), or the amount of money that actually
flows through the online store from customer to merchant, if the merchant uses GoDaddy’s
proprietary system. This builds on GoDaddy’s strength of already having competitive prices
in the market for its products.
6.1.1.3 Promote marketplace integration assistance (S3-S4-O4)
By promoting its strengths of customer support and diverse employee base, GoDaddy
can promote helpful and inclusive assistance to merchants who prefer to sell their products on
larger e-marketplaces such as Amazon, Lazada, or Shopee. These tools already exist, but their
promotion will allow GoDaddy to maintain customer support as well as attract new
customers who want to use larger marketplaces but are not tech-savvy and need real-time
assistance; often larger marketplaces’ help sites are impersonal or can provide “information
overload” to the new merchant (Amazon, Inc., 2021).

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6.1.1.4 Pursue more acquisitions of e-commerce technology (S5-O5)
With a large revenue base and steady profit margin, GoDaddy can leverage its
position and pursue acquisitions of smaller firms, focusing on those with new or streamlined
e-commerce technology that can be integrated into GoDaddy’s own proprietary products.
6.1.1.5 Increase hiring efforts for e-commerce specialists (S4-S5-O5)
Competitors such as Shopify are focusing hiring on specialists, such as software
engineers with e-commerce experience, marketers, researchers and more (Shopify, Inc.,
2019). GoDaddy should highlight more strongly its dedication to diverse hiring practices and
focus on hiring engineers and experts who can build their e-commerce SaaS vertical, which
can help GoDaddy and also potentially prevent the same talent from going to competitors.
6.1.2 S-T Strategies
The following section summarizes recommendations that utilize GoDaddy’s internal
strengths to counter or defend against external threats from the market and competitors.
6.1.2.1 Counter-advertising against Shopify (S1-T1)
While GoDaddy’s e-commerce Store Builder is not as customizable as Shopify or
Wix (referencing the CPM earlier in this paper), GoDaddy’s strength of having more non-
store SaaS products for a small business available is an attractive proposition for an
advertising campaign against its competitors in the e-commerce SaaS market.
6.1.2.2 Continue integration of open-source tools (S5-T2)
If GoDaddy wishes to keep its focus on both its proprietary Store Builder and its
Managed WordPress offerings, it can continue the purchase and integration of WordPress e-
commerce plugins; by purchasing the rights to certain plugins, it can choose to either prevent
other hosts from offering these plugins to their customers/merchants, or charge a premium fee
for the use of the technology, which can give GoDaddy a competitive advantage when
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attracting merchants who prefer to use open-source products instead of proprietary e-
commerce solutions like Shopify or GoDaddy Store Builder.
6.1.2.3 Create expanded Security Team (S3-S4-T3)
With GoDaddy’s already impressive customer support and global employee base, the
company can focus on creating an expanded Security Team to prevent future data breaches
and other cyber security issues. If the company can distinguish itself from competitors with
its privacy and security measures, it can become a competitive advantage.
6.1.2.4 Leverage international workforce for VAT compliance (S4-T5)
GoDaddy can empower its global employee base to research and contribute to its
knowledge of sales tax/VAT compliance in different countries, enabling it to expand its
proprietary payment product and reach more merchants with its payment systems, increasing
overall revenue in the e-commerce vertical.
6.1.3 W-O Strategies
The following section compares the internal weaknesses of GoDaddy with the
external opportunities of the industry and makes recommendations on how GoDaddy can try
to improve its weaknesses to take advantage of the relevant opportunity in the market.
6.1.3.1 Focus all marketing on e-commerce (W1-O1)
Since GoDaddy is already the leading player in the domain vertical, with no clear or
close competitor, the company can focus all its marketing and advertising on e-commerce, at
least for the near future. By doing this it can shift its customer focus more clearly into the e-
commerce context, which will be needed to compete with growing competitors like Shopify.
6.1.3.2 Divert more of R&D budget to proprietary tech stack (W2-O5)
GoDaddy is spending considerable amounts of money on purchasing WordPress
plugin technology rather than focusing fully on its proprietary Store Builder, which can
provide more overall revenue if built up and promoted properly (Rice, 2020). Rather than
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continuing this trend (which is also a recommendation in an earlier section), GoDaddy can
focus more of its R&D and acquisition budgets into technology that can be integrated either
directly with its proprietary Store Builder or used on both platforms (Louise, 2020).
6.1.3.3 Push users from WordPress to Store Builder (W3-O1-O5)
As part of this plan, GoDaddy could begin to make efforts to shift its current
customers and merchants on Managed WordPress plans who also have a store into the
GoDaddy Store Builder product, by offering discounts, customized support, and expedited
migration onto the proprietary platform, to help minimize the split focus GoDaddy has
between proprietary products and managed open-source.
6.1.3.4 Increase payment partnerships with global marketplaces (W4-O4)
GoDaddy can pursue partnerships with global marketplaces, specifically to utilize
their payment systems on GoDaddy’s platforms. Being able to accept local e-cash systems
like Lazada Wallet and Shopee Pay, for example, will not only provide convenience to
customers in countries where credit/debit card usage is limited, but also increase visibility of
GoDaddy’s e-commerce options to larger customer/merchant groups, some of whom may
only be familiar with the larger e-marketplaces.
6.1.4 W-T Strategies
The last recommendation section of the SWOT/TOWS Matrix looks at the internal
weaknesses of GoDaddy compared to the external threats and offers suggestions as to how
GoDaddy can reduce or eliminate some of the outside threats while at the same time reducing
the effect of the weaknesses acting upon GoDaddy’s internal operations.
6.1.4.1 Research buying smaller competitors (W1-W2-T1)
Rather than focusing on companies with specific technologies to integrate into its own
products, GoDaddy can investigate opportunities for using its large financial leverage power
to outright purchase some of its smaller competitors in the SaaS e-commerce market, such as
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BigCommerce. Other large companies are doing this as well to enter the market (such as
Adobe acquiring open-source e-commerce platform Magento and turning it private), so this
can not only help GoDaddy gain more customers, but prevent new entrants from coming into
the market by purchasing an established product (Grant, 2018).
6.1.4.2 Use acquisitions to add to tech stack (W3-T2)
GoDaddy should use whatever acquisitions it chooses to make (whether open-source
plugin technology or direct competitors) to increase the reach of its own products’ tech stack,
technical abilities, services, and software connections available to be used by
merchants/customers (Brewster, 2021).
6.1.4.3 Pursue partnership/acquisition of payment processors (W4-T5)
GoDaddy can also look at engaging in exclusive partnerships with payment
processors to gain access to preferential transaction fees and larger customer bases,
increasing its margin. It could also look into the possibility of acquiring smaller, nation-based
payment processors to facilitate its payment system’s expansion into additional countries.
6.1.5 SWOT/TOWS Recommendation Summary
The recommendations suggested in the above SWOT/TOWS Matrix fall into the
strategic categories of: Market Penetration, Product Development, Forward Integration, and
Horizontal Integration. These categories will be tallied in the Summary of Strategies later in
this section to help determine the appropriate strategies to best meet GoDaddy’s future
financial and strategic objectives.
6.2 Strategic Position and Action Evaluation (SPACE) Matrix
The Strategic Position and Action Evaluation, or SPACE, Matrix, is another tool
designed to show which types of strategies would be best for a particular company or
organization based on its internal and external strategic positions (David & David, 2017).
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The table below shows the various strategic positions for GoDaddy, including its
Financial Position (FP), Competitive Position (CP), Stability Position (SP), and Industry
Position (IP), followed by the visual representation of the SPACE Matrix results:
Table 33 - SPACE Matrix Variable Values
Internal Strategic Position External Strategic Position

Financial Position (FP) Stability Position (SP)
Operating Margin 6 Technological Changes -4
Leverage 3 Demand Variability -1
Liquidity 5 Price range of competing products -5
Return on Equity 7 Barriers to Entry -3
Cash Flow 5 Competitive Pressure -5
Average 5.2 Average -3.6
Competitive Position (CP) Industry Position (IP)

Market Share -4 Growth Potential 7
Product Quality -5 Profit Potential 7
Customer Loyalty -2 Financial Stability 3
Customer Satisfaction -1 Extent Leveraged 2
Technological Know-How -3 Ease of Entry into Market 5
Average -3 Average 4.8
Calculation Notes: On positive axes (FP/IP), scores range from 1 (worst) to 7 (best). On
negative axes (SP/CP), scores range from -7 (worst) to -1 (best).
X-Axis Calculation:
CP Average + IP Average = -3 + 4.8 = 1.8
Y-Axis Calculation:
FP Average + SP Average = 5.2 + -3.6 = 1.6
Figure 25 - Graphical Representation of SPACE Matrix

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As GoDaddy falls clearly into the Aggressive quadrant within the SPACE Matrix, this
opens up a number of categories of strategy for the company to pursue according to David &
David (2017), including: Market Penetration, Market Development, Product Development,
Horizontal Integration, Forward Integration, Backward Integration, Related Diversification,
and Unrelated Diversification.
6.3 Boston Consulting Group (BCG) Matrix
The Boston Consulting Group (BCG) Matrix, also known as the Growth-Share
Matrix, was developed by the founder of the Boston Consulting Group, Bruce Henderson, in
the late 1960s and refined in the early 1970s (Hax & Majluf, 1983). This particular strategic
formulation tool is designed to help companies that are made up of diversified divisions to
develop strategies and inform decisions on where to place strategic and financial focus for the
best growth opportunities (Stern, 1998). With GoDaddy having two distinct business
verticals, Domains and SaaS, this tool can be useful in identifying the best target for
expansion and growth. The BCG Matrix uses input data including specific division revenue,
the revenue of the top firm in the industry, the overall industry growth rate, and the relative
market share position of the division within its industry (Reeves, Moose, & Venema, 2014).
Table 34 - Boston Consulting Group (BCG) Matrix Calculations
Division Division Revenue Top Firm Division Industry Relative Market

(in $millions) Revenue Growth Rate Share Position
Domains $1,515 $1,5151 0.13 1.00
SaaS $1,802 $2,9292 0.203 0.62
Notes:
1: Next highest firm domain revenue is Tucows, with $206 million in revenue in 2020.
2: This number reflects the revenue Shopify, the top company in this vertical in 2020.
3. Growth rate of top 3 firms (representing the industry) is actually 0.43; the guidelines for
the BCG Matrix state for the purpose of this tool to use a maximum growth rate of 0.20
(David & David, 2017).
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Figure 26 - Boston Consulting Group (BCG) Matrix Visual Representation
Upon calculating the relative scores for each of GoDaddy’s divisions and charting
them on the visual representation of the BCG Matrix, one can easily identify both divisions
as Stars, and worthy of attention. However, there is a slight weakness to the BCG Matrix
concerning GoDaddy and its position within the SaaS e-commerce industry. The BCG Matrix
as designed by Henderson was not equipped to deal with a super-high-growth industry, such
as is often seen in the Internet Age. As David and David (2017) note in their guide on the
BCG Matrix, the matrix cannot correctly portray the position of a division with an industry
growth rate of over 20%. Based on the research in this paper, one can see that the growth of
the SaaS e-commerce market is currently around 43% using the calculations advised by
David and David. To develop the BCG Matrix that growth rate must be reduced to 20% for
representation on the visual matrix. Therefore, although both divisions are noted as Stars on
the BCG Matrix, the SaaS division’s industry growth is so much higher than the Domain
division that more focus should be devoted to that as a whole by the company, rather than the
somewhat equal focus as may be suggested by the visual BCG Matrix representation alone;
this paper indeed focuses on strategies for growing the SaaS e-commerce division of the
company exclusively..
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The position of both divisions on the matrix in the “Star” Quadrant recommends
strategies including Market Penetration, Market Development, Product Development,
Horizontal Integration, Forward Integration, and Backward Integration.
6.4 Internal-External (IE) Matrix
The Internal-External, or I-E, Matrix is another graphical representation showing the
overall position of a company within its industry, using both external and internal metrics. In
this particular matrix, the company scores from the Internal Factor Evaluation (IFE) and
External Factor Evaluation (EFE) are used and plotted onto a nine-quadrant visual
representation. This plotting shows the company’s position of strength or weakness overall,
and hints as to which categories of strategies are best used for the company’s future growth.
As the IFE and EFE for this paper concentrated solely on the SaaS e-commerce division of
the company, the I-E Matrix will also only show the representation of this division, rather
than a multiple-division representation as suggested by David and David (2017) as an option
for comparing different verticals of an individual company.
Figure 27 - Internal-External (I-E) Matrix Visual Representation

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With an IFE weighted score of 2.71, and an EFE weighted score of 2.83, GoDaddy’s
SaaS division falls into Quadrant V, Region 2, also known as the “Hold and Maintain” region
(David & David, 2017). This would indicate that the strategic categories of Market
Penetration and Product Development are the only ones potentially viable for GoDaddy.
However, when looking at both the increasingly high growth of Shopify, along with the
position of the division on the matrix itself, this paper assumes the possibility that the
division could also potentially avail itself of strategies from Quadrant II, Region 1, or the
“Grow and Build” region, which adds the additional recommended categories of Market
Development, Horizontal Integration, Forward Integration, and Backward Integration.
6.5 Grand Strategy Matrix (GSM)
The Grand Strategy Matrix (GSM) is another tool to view a company’s position
relative to both industry growth and competitive position, and recommend additional
strategic categories to pursue. This four-quadrant matrix can determine a company’s position
by plotting the growth of the company’s market/industry compared to the competitive
position of the company relative to its peers (David & David, 2017).
Figure 28 - Grand Strategy Matrix

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As previously noted, the market growth for SaaS e-commerce is very high, which
would immediately place GoDaddy into either Quadrant 1 or 2 within the Grand Strategy
Matrix. In determining competitive position, this paper considered the size of the company in
terms of revenue compared to its nearest competitors and its capability for growth based on
its financial status and liquidity. As the number two company within the market as of 2021,
with a healthy profit margin and financial status, GoDaddy can be considered to have a strong
competitive position within the market. These two factors place GoDaddy firmly into
Quadrant 1 of the Grand Strategy Matrix, which recommends the strategic categories of
Market Development, Market Penetration, Product Development, Forward Integration,
Backward Integration, Horizontal Integration, and Related Diversification.
6.6 Summary of Recommended Strategies
Once a sufficient number of strategic formulation tools are applied to a particular
company, the various recommended strategies can be totaled and reviewed; generally, while
every strategic category recommended by the aforementioned tools could be analyzed and
considered for use, an option for optimizing the strategy formulation process includes using a
Summary of Strategies table to identify the strategic categories that are recommended the
most throughout the various tools. The table below summarizes the strategic categories
recommended by the tools used in this paper, and identifies the categories that were most
recommended throughout the toolset:
Table 35 - Summary of Recommended Strategies
Strategies SWOT SPACE BCG I-E Grand Strategy Total

Integration Strategies
Forward Integration 1 1 1 1 1 5*
Backward Integration 1 1 1 1 4
Horizontal Integration 1 1 1 1 1 5*
Intensive Strategies
Market Penetration 1 1 1 1 1 5*
Market Development 1 1 1 1 4
Product Development 1 1 1 1 1 5*
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Strategies SWOT SPACE BCG I-E Grand Strategy Total
Diversification Strategies
Related Diversification 1 1 2
Unrelated Diversification 1 1
Defensive Strategies
Retrenchment 0
Divestiture 0
Liquidation 0
Totals marked with an asterisk (*) were identified for use in QSPM.
Only four strategic categories were recommended by all of the tools (SWOT, SPACE
Matrix, BCG Matrix, I-E Matrix, and Grand Strategy Matrix) used in this paper: Forward
Integration, Horizontal Integration, Market Penetration, and Product Development. These are
the categories that will be taken forward into the Decision Stage of Strategy Generation, the
Quantitative Strategic Planning Matrix (David & David, 2017).
6.7 Quantitative Strategic Planning Matrix (QSPM)
The Quantitative Strategic Planning Matrix, or QSPM, is a tool that can help a
business to narrow down and prioritize different strategic categories recommended by the
tools above for implementation to achieve identified objectives (David & David, 2017). The
recommended categories are weighed and rated based on three steps. First, the weight of each
of the strengths and weaknesses of the companies, as well as the opportunities and threats of
the external environment, as identified by the previously completed IFE and EFE. Second,
each recommended category is ranked with an Attractiveness Score (AS). This score ranks
how well that particular category would do in assisting the company with a particular
strength, weakness, opportunity, or threat. The rankings are “forced,” meaning each category
must be rated with a unique number (in the case of this paper, where four categories are being
considered, the rankings would be from 1 for “least attractive” to 4 for “most attractive). If
none of the categories are particularly useful or attractive for a specific strength, weakness,
opportunity, or threat, no attractiveness scores are given. Finally, the rankings are multiplied
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by the weight for that particular strength, weakness, opportunity, or threat to derive a Total
Attractiveness Score (TAS); these scores are added up and the categories with the highest
totals are identified as the best potential strategies for a particular company. Upon completing
the Summary of Strategies, four strategic categories were recommended, as shown in the
following table:
Table 36 - Categories Recommended for QSPM
Strategic Category Description

Market Penetration Seeking increased market share for present products or services in
present markets through greater marketing efforts
Product Development Seeking increased sales by improving present products or services

or developing new ones
Horizontal Integration Seeking ownership or increased control over competitors
Forward Integration Gaining ownership or increased control over distributors or

retailers
Definitions of categories quoted from David & David, Strategic Management, Concepts and Cases (2017).
These categories were then ranked against the Strengths, Weaknesses, Opportunities,
and Threats of GoDaddy’s SaaS e-commerce division based on the weights from the IFE and
EFE. The QSPM for GoDaddy is presented below:
Table 37 - Quantitative Strategic Planning Matrix (QSPM)
Market Product Horizontal Forward

Penetration Development Integration Integration
Weight AS TAS AS TAS AS TAS AS TAS
Strengths
Additional SaaS business tool 0.15 3 0.45 4 0.60 2 0.30 1 0.15
set available
Cost-effectiveness/price of 0.12 4 0.48 2 0.24 3 0.36 1 0.12
products offered
Quality of customer service and 0.11 4 0.44 3 0.33 2 0.22 1 0.11
support
Satisfied and diverse customer 0.08 4 0.32 3 0.24 2 0.16 1 0.08
base
Corporate focus on e-commerce 0.05 4 0.20 3 0.15 2 0.10 1 0.05
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Market Product Horizontal Forward

Penetration Development Integration Integration
Weaknesses
Promoting brand in e- 0.18 4 0.72 1 0.18 3 0.54 2 0.36
commerce context
E-commerce capabilities in 0.16 1 0.16 4 0.64 3 0.48 2 0.32
proprietary product stack
Split focus between proprietary 0.09 4 0.36 2 0.18 3 0.27 1 0.09
products and open-source
International reach of 0.06 2 0.12 1 0.06 3 0.18 4 0.24
proprietary payments
Opportunities
Growth of global e-commerce 0.20 4 0.80 1 0.20 3 0.60 2 0.40
industry
Growth of global web hosting 0.13 4 0.52 1 0.13 3 0.39 2 0.26
industry
Cost of cloud infrastructure 0.08 1 0.08 4 0.32 3 0.24 2 0.16
becoming cheaper
Customers prefer to shop in 0.07 4 0.28 1 0.07 2 0.14 3 0.21
larger e-marketplaces
Technology to streamline e- 0.06 1 0.06 2 0.12 4 0.24 3 0.18
commerce improving
Threats
Competition from fellow SaaS 0.16 1 0.16 2 0.32 4 0.64 3 0.48
platform providers
Competition from open-source 0.10 3 0.30 2 0.20 4 0.40 1 0.10
software packages
Cybersecurity – hacks/dataleaks 0.08 - - - - - - - -
becoming more sophisticated
Increasingly strict data privacy 0.07 - - - - - - - -
regulations
International differences in 0.05 3 0.15 1 0.05 2 0.10 4 0.20
VAT/Sales Taxes
Totals: 5.60 4.03 5.36 3.51
Two of the threats identified in the EFE, Cybersecurity and Data Privacy Regulations,
were not identified as compatible with the strategic categories recommended, and no rankings
were given for these lines.
After calculating the rankings along with the weights of each remaining line, the
category with the highest overall attractiveness score of 5.60 was Market Penetration. The
next highest score of 5.36 was for the category of Horizontal Integration. The other two
categories, Forward Integration and Product Development, received lower overall
attractiveness scores, but are not immediately disqualified from consideration when
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developing recommendations and action plans. However, priority for developing strategies
should focus on the first two categories in order to best meet the company’s objectives.
7. Objectives and Strategy Recommendations
7.1 Strategic and Financial Objectives
Once the analysis and review of the company’s current status (internally and
externally) is completed, and potential categories of improvement and action are identified
through the strategic formulation process, attention can then be turned to codifying specific
strategic and financial issues and objectives for the company, in line with their industry
position, internal abilities, and the ideals of their vision and mission statements. Once the key
issues are identified, and strategic and financial objectives codified to address those issues,
specific and actionable strategy recommendations can be made with the goal of meeting or
exceeding the strategic and financial objectives.
7.1.1 Key Strategic Issues
The key strategic issues facing GoDaddy are two-fold. First is the ever-increasing
growth of its main competitor in the SaaS e-commerce market, Shopify. Within the last three
years, Shopify overtook GoDaddy as the leader in SaaS e-commerce revenue, and is quickly
eclipsing all of the other competitors in the space; they are threatening to achieve a market
leadership comparable to GoDaddy’s mastery of the domain industry. Simply aiming to
become the market leader within the next three years is not feasible for GoDaddy; Shopify’s
growth has been too high from 2018-2021. GoDaddy must create a strategic objective that
shows their goal of regaining market share and still achieving the goal in the vision statement
of becoming the “premier” SaaS e-commerce solution for merchants.
The second key issue is GoDaddy’s growth rates compared to the competition and the
market in general. GoDaddy’s CAGR of 12% is markedly behind all of its competitors,
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which is driving its loss in market share; even as it grows, it shrinks compared to the market.
GoDaddy must take an aggressive approach to increasing its CAGR over the next three years
in order to even begin to regain its market share that it has lost in the previous three years.
7.1.2 Strategic Objective
As just noted, GoDaddy will be unable to “beat” Shopify and overtake their position
as the number one SaaS e-commerce provider in the next three years. However, through
judicious use of market penetration and horizontal integration strategies, they may be able to
build enough growth themselves along with slowing Shopify’s growth in order to begin
reclaiming overall relative market share – this goal will also allow GoDaddy to take market
share from the smaller competitors, which can help spur its CAGR compared to the
competition. The strategic objective for GoDaddy in the next three years is summarized as
follows:
To increase relative market share by 5% among the Top 5 SaaS e-commerce platforms
by 2024, stemming the disruptive growth of Shopify.
7.1.3 Financial Objective
GoDaddy must also aggressively work towards increasing its historical CAGR over
the next three years; without this increase, it has no chance of meeting its strategic objective
of regaining market share. Using financial analysis and projections presented in Section 8, it
was determined that a strong, incremental growth rate year-on-year, culminating in an overall
38% CAGR within the SaaS e-commerce vertical for years 2022-2024, would be a sufficient
and realistic target. The industry growth as a whole stood at 43% in 2020, and Shopify’s
CAGR was 58% from 2018-2021. With this growth target, GoDaddy can aim to achieve
$5.07 billion in revenue in the SaaS e-commerce vertical in 2024, with a total company
revenue (including a 15% CAGR for the domain vertical in the same years) of $7.53 billion.
The three-year financial objective for GoDaddy can be therefore summarized as follows:
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To grow revenue at an increasingly high rate, year on year, achieving 38% SaaS
CAGR for 2022-2024.
7.2 Recommended Strategies
Once the key issues are identified and addressed through specific strategic and
financial objectives, the company can then turn to recommending specific, actionable plans in
order to achieve those objectives. These recommendations can be prioritized around the
strategic categories identified from the QSPM, with the most attractive categories addressed
first, and the less attractive categories included for consideration afterwards.
7.2.1 Market Penetration Strategies
The following strategies focus on market penetration, or ways for GoDaddy to
increase their market share by changing/increasing marketing efforts. This section includes
recommendations for setting different pricing structures for its services, as they are not
new/different products, but re-packaging of the same options previously offered by GoDaddy.
7.2.1.1 Promote “all-in-one” online business package
With a large amount of products and services offered at a-la-carte rates, no other SaaS
e-commerce platform has as many plans or pricing structures as GoDaddy (GoDaddy, Inc.,
2021). This can be a daunting prospect for a new e-commerce merchant who wishes to set up
an online store – it can be very difficult on GoDaddy’s website to select the plan that is right
for them, and then to add on different business functions that can be useful for their venture.
GoDaddy currently advertises its “E-Commerce” hosting plan with the Store Builder
function for $17.49 per month (renewable at $24.99 per month after the first year). It also
offers “Advanced” Managed Hosting products using WordPress or other systems for much
higher prices, ranging from $44.99 per month to $99.99 per month. The E-Commerce plan is
listed for a cheaper price because GoDaddy Payments, their proprietary payments system, is
the only payment gateway allowed on the Store Builder platform; this allows GoDaddy to
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maximize the revenue from merchant transaction fees, whereas with managed hosting,
merchants can install whichever payment gateway they prefer (GoDaddy, Inc., 2021).
While GoDaddy’s proprietary Store Builder product is demonstrably less powerful
than the products of its main competitors Shopify and Wix, it is also much easier to initially
set up (once a subscription plan is selected). GoDaddy also has more add-on business
services available than its competitors (as portrayed in the Customer Roadmap for e-
commerce merchants), such as domain services, website security, business email, telephony,
and business productivity app subscriptions like Office 365.
GoDaddy can therefore lean on its strengths of having a much greater selection of
business tools and create an “All-in-one” e-commerce business subscription for its customers
and merchants, which would make the selection process much easier for new merchants, and
also increasing revenue (as some merchants may not choose all of the individual add-ons on
an a-la-carte basis). The following table shows the current a-la-carte pricing and the proposed
pricing for an “All-in-one E-Commerce” plan which includes all of the addons:
Table 38 - Comparison of A-la-Carte vs All-in-One hosting plan pricing
Service Price
Hosting with Store Builder $17.49 per month
Domain registration $7.99 per year
Website security monitoring $19.99 per month
Business E-mail $3.66 per month
Business Telephony $9.99 per month
Business Productivity Apps $7.99 per month
Total Monthly Price (A-la-Carte) $59.12 per month (plus $7.99/yr for
domain)
All-in-One E-Commerce Plan $50 per month (including domain)

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The adjusted “bundle” price of $50 a month would provide growth in revenue for the
Store Builder project and extra subscriptions of business applications (which some businesses
might not even consider until included in the bundle). Most importantly, the cost of this all-
in-one plan is still $29/month cheaper than the Shopify Standard Plan at $79 per month,
which has more customization options but none of the business applications (Shopify, Inc.,
2021), and can be a strong differentiator for GoDaddy as it fights to regain market share.
7.2.1.2 Discounts on plans based on GMV
The method GoDaddy currently uses to entice newer, smaller merchants to use their
platform is to offer introductory prices for the first year, and then increase the monthly fee for
the second year onwards; while this does not please a good portion of customers who can
refer to it as “bait and switch” (Trustpilot, 2021), they still often remain with GoDaddy’s
service due to the technological difficulties and costs inherent in switching to a new platform.
Rather than continuing this marketing plan (and with the introduction of the All-in-
One E-Commerce plan above), GoDaddy should switch their marketing from a “bait-and-
switch” strategy to a “progressive discount” strategy based on Gross Merchandise Value
(GMV) of the merchant’s store traffic. As noted before, GoDaddy Payments, the company’s
proprietary payments system, is the only payment gateway allowed on the Store Builder
platform. As such, GoDaddy gets a percentage of every single transaction flowing through a
merchant’s store. The percentage charged the merchant is typically 2.9%. The amount that the
payment gateway actually earns after paying the needed fees to the credit card companies and
banks varies depending on negotiations between the company and the banks, but is generally
around 1% of the total transaction (Maiorana, 2021). Thus, for example, if a merchant makes
$1 million in sales in a given year, GoDaddy should make $10,000 in transaction fee profit,
on top of the monthly hosting fee that the merchant pays.

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GoDaddy can leverage this exclusive transaction fee revenue to offer discounts to
small merchants beginning their stores. For the first year of subscription to the All-in-One E-
Commerce plan, customers can save $10 per month per every $1,000 of GMV that goes
through their stores – up to the cost of their hosting plan. That promotion would be valid for
their first year of subscription. This adds no additional cost to GoDaddy, as each $1,000 in
GMV provides $10 of revenue to the company, and the cost per customer would not reach
more than $50 per month. GoDaddy then has the customer locked in with the hope that if
their business makes $1,000 in sales in a given month, they can save 20% of their hosting
cost, and when the price stabilizes at $50 per month the second year, they do not feel cheated.
This is a net-positive way for GoDaddy to entice more customers to its platform and gain
more revenue through GMV coming through its proprietary payment gateway.
7.2.1.3 Leverage GoDaddy Guides as “Store Concierges”
As noted in the introduction of this paper, 70% of GoDaddy’s workforce consists of
“GoDaddy Guides,” or customer service and support specialists for their customers. These
Guides are available in approximately 25 languages around the world in dozens of different
countries, with more added on a regular basis, providing 24-hour support by chat, e-mail, or
local telephone (GoDaddy, Inc., 2021). While this is a positive differentiator for GoDaddy, it
is also a cost center, as the support is provided to customers for free. It is also limited to
technical support and general customer service and is also skewed towards upselling. A
personal interview with a former employee of GoDaddy revealed that many GoDaddy Guides
are trained to upsell to more expensive plans/products rather than providing more robust
service on the customers’ current plan (Nolasco, 2021).
If the company transitions to an All-in-One E-Commerce plan to compete with similar
“simple” offers from competitors, the opportunity for upselling will be minimal, and another
way to entice customers and earn revenue from customer service calls can be recommended.
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As has been noted throughout this paper, many small businesses and entrepreneurs may not
have the technical expertise to establish their online store without hiring outside technical
help. GoDaddy Store Builder is the easiest store of the main competitors to initially set up,
but there are still business owners who may require more assistance, or “handholding,” to
create the options they wish for their store.
WordPress.com, a managed WordPress hosting company owned by Automattic, Inc.
(one of the open-source competitors/collaborators with GoDaddy, and not included in
competitive profiles as per the External Analysis section of this paper), offers a service for its
customers known as Quick Start Sessions, where they are able to have a 30-minute Zoom
session with a customer support specialist who can guide them through the basics of setting
up a website on their platform and answer specific technical questions utilizing screen-
sharing technology. These calls are included in some of the higher-priced plans at
WordPress.com, and extra calls are available for $50-60, depending on location and currency,
and are offered only in English (Automattic, Inc., 2021).
Figure 29 - WordPress.com Quick Start Session - Philippines
GoDaddy can offer similar services to customers and merchants who want more in-
depth support for their store and website, rather than only offering free support. While other
companies such as WordPress.com offer English-only service, GoDaddy can leverage the
international capacities of their global Guide team and provide “Concierge” services to
customers in multiple different languages, providing an additional differentiator that sets
GoDaddy apart from competitors; and by charging for the personal “Concierge” service (at a
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price point of $50, similar to WordPress.com), can earn revenue from its customer service
platform, while eliminating plan up-selling and improving overall customer service.
7.2.1.4 Leverage GoDaddy Guides as “Migration Experts”
Another premium service that GoDaddy Guides can provide as a paying option for
customers is the migration of a store website from one e-commerce platform to another. As
noted previously, migrating SaaS platforms is time-intensive and requires a considerable
amount of technical knowledge of the platforms themselves, something that most business
owners do not have. Some major SaaS platforms have different tools and guides to assist in
migration, including the Shopify Store Importer app (Shopify, Inc., 2021). Other platforms,
such as GoDaddy and Wix, make it difficult to seamlessly transfer away from their service,
hoping to keep merchants on their platforms (IsitWP Editorial Team, 2020). Currently, if a
merchant does want to migrate to a new platform, they often need to hire outside technical
assistance. There are numerous individual experts and technical agencies that provide this
service, with rates varying from $100 and up, depending on the size of the store
(LitExtension, 2021). Wix partners with an outside service, Cart2Cart, to help merchants
import their stores into Wix, at a cost that is paid to Cart2Cart (Wix, Inc., 2021).
While these services are able to handle the entire migration, start to finish, for
merchants, there is an inherent risk in using a third-party vendor to handle and transfer
sensitive customer, product, and financial data for a small to medium business; unethical
players who set up a migration service may be able to collect and use this private information
for their own profit, and to the detriment of the merchant and its customers.
GoDaddy currently does not have a service to help merchants migrate from other
platforms to GoDaddy Store Builder, which would include steps such as transferring product
and customer data to the new site. This is another premium service that could be added to the
GoDaddy Guides service; GoDaddy could charge an optional Migration fee, $79, to have
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GoDaddy Guides handle the migration of the merchants’ stores into the GoDaddy system.
This has the benefits of assisting merchants transfer into the GoDaddy ecosystem, providing
direct revenue for the service, as well as limiting the access of sensitive information to the
merchant and GoDaddy (who would have access to it upon migration anyway).
7.2.1.5 Focus Marketing/Advertising 100% on E-commerce
GoDaddy has historically had a unique reputation in marketing and advertising its
products. The company focused heavily for many years on large, ostentatious campaigns
centered around brand awareness, most notably running multi-million dollar television ads
during the Super Bowl in the United States featuring “GoDaddy Girls,” and sponsoring the
NASCAR driver Danica Patrick for a number of years; the previous GoDaddy logo was
painted prominently on her race car during these seasons. These campaigns, while increasing
brand awareness for the name GoDaddy, did leave “some wondering what the company
actually did” (Bieler, 2018).
Figure 30 - Danica Patrick NASCAR race car with GoDaddy logos
GoDaddy has now shifted their marketing strategy to be more directed towards its
actual target markets – as early as 2018 GoDaddy was referring itself as “the world’s largest
cloud platform dedicated to small, independent ventures” (Bieler, 2018). However,
advertising is still very mixed, due to the incredibly high number of options and products
offered by GoDaddy – there is still considerable advertising surrounding GoDaddy’s
Managed WordPress and WooCommerce offerings, which compete directly (albeit open-
source) with GoDaddy’s Store Builder platform.

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Spending for marketing and advertising at GoDaddy is 13% of total company
revenue, with $438.5 million spent in 2020; however, this spend is split between not only the
different hosting/website offers of the SaaS vertical, but also the Domain vertical (GoDaddy,
Inc., 2021). This paper considers that GoDaddy’s leadership of the Domain vertical cannot be
realistically challenged by other competitors within the next three years, and that GoDaddy’s
advertising should be devoted exclusively to promoting its e-commerce packages and Store
Builder. This will build up brand awareness for GoDaddy as a premier e-commerce service
provider (noted as a weakness earlier in the IFE), build the customer base for the GoDaddy
Store Builder product and GoDaddy Payments, and be the main driver for the planned growth
of GoDaddy over the next three years. This recommendation includes an increase of the
advertising budget to 18% of expected revenue for that year, with an estimated budget of
$1.397 billion for marketing and advertising in 2024.
Figure 31 - Historical and Projected Ad Spend for GoDaddy 2018-2024 (in $ mil)
7.2.1.6 Increase adoption of GoDaddy Payments on open-source platforms
GoDaddy Payments, the proprietary payment gateway for GoDaddy which was
developed as a result of the acquisition of the software company Poynt (Louise, 2020), is
currently the only payment gateway usable on the GoDaddy Store Builder platform, a
restriction designed to maximize revenue for GoDaddy as they are able to profit from the
transaction fees. Optimally, GoDaddy would like to expand the usage of its payment gateway
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outside of the GoDaddy Store Builder and onto other platforms, such as the open-source
WordPress, used for over 40% of websites on the Internet, e-commerce or otherwise (Young,
et al., 2021). While GoDaddy offers GoDaddy Payments as an automatic integration to its
WooCommerce/WordPress Managed Hosting options (GoDaddy, Inc., 2021), there are many
other options for WordPress users to choose from, whether they are using GoDaddy’s hosting
options or not. As such, it is currently difficult for GoDaddy to gain much traction in the
open-source space promoting GoDaddy’s proprietary payment gateway.
This can be shown by viewing the plugin page for the payment gateway on the Plugin
market on WordPress.org, the main hub for global WordPress plugins available to be used by
any user building a WordPress-based website, and not to be confused with WordPress.com,
the commercial WordPress hosting site owned by Automattic, Inc. (Automattic, Inc., 2021).
For the open-source market, GoDaddy refers to its payment gateway plugin as Poynt – A
GoDaddy Brand for WooCommerce, to distinguish that it can be used on any WordPress site
(GoDaddy, Inc., 2021). Out of the 3.8 million active websites using WooCommerce as an e-
commerce platform (Keith, 2021), there have been only approximately 800 active
installations of the Poynt plugin outside of the GoDaddy Managed Hosting environment, and
only two reviews (one positive and one negative) left on the WordPress.org plugin market:
Figure 32 - Download stats and ratings for Poynt @ WordPress.org plugin market
GoDaddy can integrate awareness and visibility of this option within its e-commerce
marketing campaigns; however, it must also have a positive differentiating factor to set it
apart from the multiple different payment gateways available in the open-source space. This
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paper recommends lowering the transaction fee (currently the standard 2.9% + $0.30 for US
transactions) to encourage adoption of the plugin for a limited period of time (for example,
the first 6 months), and then reverting back to the standard fee. This will encourage
merchants to install the plugin, and general inertia may have them keep the gateway active
after the promotional period, when it would not save any money to switch to another
competitor. However, in order to accomplish this, GoDaddy must ensure that the plugin stays
updated and comparable technologically to other gateways on the WordPress market.
7.2.2 Horizontal Integration Strategies
The next section of recommendations includes strategies around horizontal
integration, where GoDaddy can consider acquiring other products or even full companies
within its industry space in order to increase market share and reduce competition.
7.2.2.1 Acquire smaller companies in E-commerce space
The most common horizontal integration strategy, especially within the tech industry,
is for larger companies to buy smaller companies to integrate their technology and customer
base into its own. Recent examples of this include Microsoft buying Skype to integrate into
Office 365, Salesforce buying Slack to integrate into its Customer Relationship Management
systems, or indeed, GoDaddy buying Poynt to integrate its payment technology into
GoDaddy’s e-commerce offerings (Louise, 2020).
Figure 33 - Companies purchased by GoDaddy, Inc. in 2020
With its size and secure financial position, GoDaddy can continue to make targeted
acquisitions as part of their expansion plan. Its most recent purchase was that of SkyVerge, a
WordPress plugin designer; it is unsure how much SkyVerge technology can be integrated
into Store Builder (which does not use WordPress), but it can be used to increase the
GODADDY, INC. 137
exclusive options available to Managed WordPress customers (Rice, 2020). GoDaddy also
purchased a domain registry, Neustar, in 2020, which for this paper is not a wise use of their
acquisition budget; as the master of the Domain registrar industry, GoDaddy can better utilize
its budget to focus more clearly on e-commerce acquisitions (Allemann, 2020).
7.2.2.2 Partnerships with competitors
There is often a great amount of collaboration even amongst fierce competitors within
the technology industry, as long as that collaboration results in a wider customer base for a
particular company. In fact, because so many employees move between tech companies, and
communication within the community is extremely strong due to the nature of the Internet,
the wider Internet industry, competing for the same customers, is often referred to as
“incestuous” (Crook, 2014), and allows collaboration to take place easier than might be
possible within other industries. Examples of this include Google products being easily found
on the iOS App Store, Microsoft Office 365 available on Mac OS, or Apple Music being
available on Windows platforms.
GoDaddy reflects an excellent example of this in how it created a partnership with
Automattic, Inc. and WooCommerce in order to advertise its e-commerce products within its
Managed WordPress hosting products (GoDaddy, Inc., 2021). While WooCommerce
Payments, Automattic, Inc.’s payment gateway, is a direct competitor to GoDaddy Payments,
both options are still available to be used on GoDaddy’s WordPress hosting, so GoDaddy can
gain revenue from the hosting fees from merchants who still choose to use other payment
providers (Automattic, Inc., 2021).
GoDaddy can look for more collaboration efforts that can increase its customer base
and improve services to its current customers. One possibility for this would be offering to
collaborate with Shopify on one of their new ventures, the Shopify Fulfillment Network
(Standard & Poors, 2020). This aims to be a direct competitor to Fulfillment by Amazon
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(FBA), providing warehousing and shipping options to small merchants, primarily in North
America (Shopify, Inc., 2021). This will be a considerable investment of money and
resources for Shopify, but aims to compete against FBA while helping its merchants ship
more easily; it is an extra service differentiator, but not direct competition against other SaaS
e-commerce providers, as other providers simply provide direct shipping links to UPS, DHL,
or other freight forwarders, or even link the merchant to the FBA network. This could be an
opportunity for GoDaddy (and other SaaS providers) to partner with Shopify to assist in
building out the Shopify Fulfillment Network by contributing financial assistance, technical
expertise, or market information; Shopify can charge the other SaaS providers fees for using
their network, but as a group they would have better bargaining power and a larger overall
merchant base with which to compete directly against Amazon, the largest e-marketplace in
the world (Hanbury, 2019); providing better prices to merchants and customers alike, and
increasing GMV flowing through store websites rather than the larger e-marketplaces.
7.2.3 Forward Integration Strategies
The following section includes strategies around forward integration, or strategies
where GoDaddy can acquire technologies further along in their supply chain. While this
strategic category did not receive as high of a Total Attractiveness Score on the QSPM as
Market Penetration and Horizontal Integration, they are still worth discussing in the paper to
provide a full analysis of the possibilities available to GoDaddy.
As GoDaddy primarily provides direct services to merchants through its SaaS e-
commerce products, the only potential forward integrations possible are with payment
processors that they could potentially use to add to their proprietary payment gateway.
7.2.3.1 Acquire payment processing companies
GoDaddy Payments, derived from the technology of payment processor Poynt after
its acquisition in 2020, is only available to United States-based merchants and for customers
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using United States-based credit and debit cards (GoDaddy, Inc., 2021). In order to expand
their payment gateway into the international market, GoDaddy will need to either make
business partnerships with international payment processors, develop the payment processing
technology themselves, or acquire the technology directly. In order to compete with Shopify
and Wix, not to mention open-source products available including WooCommerce Payments,
which are all already available in multiple countries and currencies, it is recommended for
GoDaddy to look at acquiring international payment technology as soon as possible.
Besides being able to process international credit transactions, there are a multitude of
different payment systems that are used more commonly than credit or debit in countries
around the world. The table below summarizes a few notable examples of such payment
options; with the addition of these methods to GoDaddy Payments, it would open up a much
greater payment audience for its merchants rather than relying on Visa/Mastercard
transactions from credit or debit cards:
Table 39 - Popular Global Payment Systems
Name Region Used Type of Payment

SWIFT Worldwide International Wire Transfer
Giro Europe Regional Bank Transfer
SEPA Europe Direct Debit
Sofort Germany Local Bank Transfer
GrabPay Southeast Asia E-Wallet
PASMO/Suica Japan E-Wallet/NFC
Octopus Hong Kong E-Wallet/NFC
GCash/PayMaya Philippines E-Wallet/Mobile Banking

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7.2.3.2 Partnerships with international e-marketplaces/e-wallets
While adding the above payment systems to GoDaddy Payments would greatly
increase the reach of GoDaddy Payments around the world, the logistics of arranging
payments between the systems to merchants’ accounts, in their currency of choice, would be
difficult to achieve quickly. This can be alleviated by partnerships with larger e-marketplaces
or global e-wallets.
E-Marketplaces, especially those in regions that are traditionally underbanked or have
a lower digital footprint, have invested large amounts of money and research into developing
their own e-wallets which can be funded by customers using various methods of local
deposit. Examples of these marketplace e-wallets include Lazada Wallet and Shopee Pay,
both common ways to pay for products on e-marketplaces in the Philippines (Lazada
Philippines, 2021). By collaborating with these larger, private e-wallets, and integrating their
options into GoDaddy Payments, GoDaddy can differentiate themselves from Shopify and/or
Wix, who are focused on larger payment processors in more developed markets, and
GoDaddy could greatly build its presence amongst entrepreneurs in places such as Southeast
Asia. GoDaddy could also arrange to work with global e-wallets such as Apple Pay, Google
Pay, and Samsung Pay. However, as these services are not payment processors, but merely
vehicles for payment that link directly to already established credit card processors, there
would be limited transaction fees available for GoDaddy to gain revenue from (Peek, 2020).
7.2.4 Product Development Strategies
The final section of recommended strategies comes from the category of product
development, or developing new products and services to gain more market share and
revenue (David & David, 2017). While this category received the lowest Total Attractiveness
Score on the QSPM, there are still two recommendations this paper feels worth considering
for implementation by GoDaddy over the next three years.

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7.2.4.1 Continued commitment to R&D to grow in-house tech
As e-commerce technology is currently at the forefront of global Internet innovation,
companies that wish to compete successfully must continuously evolve and develop their
technology stack or be overtaken by the competition (Brewster, 2021). GoDaddy is known
for its customer service rather than its technical innovation, but has still budgeted
approximately 16% of its annual revenues towards research and development between 2018
and 2020, with $560.4 million spent in 2020 (GoDaddy, Inc., 2021).
In order to spur its projected growth for the next three years, it is recommended that
GoDaddy increase their research and development budget to 20% of projected annual
revenues, and focus the entire budget on developing new e-commerce technologies,
specifically those that can be integrated into its proprietary Store Builder or GoDaddy
Payments products. If projected revenues meet expectations, GoDaddy will budget
approximately $1.5 billion in 2024 for e-commerce research and development, a budget
which has the potential to fund incredible advancements in the technology of the industry.
8000
7000
6000
5000
4000
3000
2000
1000
0
2018 2019 2020 2021 2022 2023 2024
R&D Cost Total Rev
Figure 34 – Historical/Projected Revenue and R&D Costs ($millions) - 2018-2024

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7.2.4.2 Look for open-source software with permissive licenses to modify
One of GoDaddy’s advantages over its competitors is its long relationship with the
open-source WordPress community. Developers from all over the world are constantly
creating new plugins and new software that are then released to the public as open-source,
meaning that anyone may use or modify the code for their own, free purposes (Open Source
Initiative, 2021). Often, there are restrictions as to how a commercial entity, such as
GoDaddy, may modify and re-use open-source code, but there are also specific software
licenses known as copyleft licenses (as opposed to copyright), where anyone is allowed to
modify and use the code for their own purposes, as long as they also make any code they
develop as a derivative open-source as well; a commonly used copyleft license is known as
the GNU General Public License (Free Software Foundation, 2007).
Because GoDaddy has an established relationship with the independent open-source
community, it has greater access than competitors to the developers working on software
within this space – they can sponsor or even fund open-source work with copyleft licenses, in
order to modify and integrate certain technologies into its own systems. The modifications
that it makes in the software would be unique to its platforms (such as Store Builder or
GoDaddy Payments), and therefore, while publicly available for use, would be difficult for
competitors to use without re-designing their own internal systems. By taking advantage of
the open-source community, GoDaddy may find itself able to fund technological
improvements to its products for a lesser cost than it would be to develop brand new
technology in-house by its own, salaried, software engineers.

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8. Strategy Implementation
8.1 Strategy Map
As part of the strategic implementation process, a strategy map can be created to show
the flow of steps within the company to not only gain buy-in for the proposed strategies, but
to follow through on recommendations in order to achieve the higher strategic goal. These
mapped steps are also laid out in the following action plans to present the recommendations
to the management of GoDaddy, Inc. as well as to implement the recommended strategies
proposed in the previous section.
In the strategy map, different goals and targets for different strategic areas are
connected by their interrelationship in order to show the path for the company to reach the
overall financial goal, which is to grow market share in order to achieve the company’s vision
of being the premier all-in-one SaaS web platform.
Figure 35 - Strategy Map for GoDaddy, Inc.
8.2 Action Plans and Programs
8.2.1 Management Presentation and Messaging Cascade
Table 40 - Senior Management Action Plan
Action Timetable Expected Output Responsible Party

Presentation of Q4 2021 Presentation material of Proponent/Internal
Strategic Proposal to recommended changes to Sponsor
vision/mission and strategic
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Senior Leadership recommendations to meet high-
Team level objectives; buy-in of
senior leadership team
Cascade of Q4 2021 Communications plan to clarify Internal

Proposed Vision and changes in vision and mission Communications
Mission compared to previous team and/or Human
statements, internal activities to Resources
spur discussion and buy-in of
line management and
individual contributors for
focused direction
8.2.2 Detailed Business Strategies Action Plans
The action plan for each strategy is marked by the number of the corresponding
subsection within Section 7.2 of this paper, along with the specific action recommended,
timeline, end result, and responsible party within GoDaddy, Inc.
Table 41 - Market Penetration #1 and 2

Determine features Q4 2021 Specific products included in all- Sales, Engineering
of all-in-one plan in-one plan identified and
quantified
Determine price Q4 2021 Specific price point for all-in-one Finance, Sales,
point of all-in-one e-commerce plan to be agreed Marketing, Senior
plan upon based on potential revenues Management,
and margin compared to existing Business
plans Intelligence
Determine Q4 2021 Finalize scheme for discounts on Finance, Sales,

discount procedure subscription fee based on total Marketing, Senior
for GMV-related amount of Gross Merchandise Management,
discounts Volume passing through Business
merchant stores Intelligence
Establish timeline Q4 2021 Detailed plan on how and when Finance, Marketing,
for discontinuation to discontinue non-bundled plans Guides
of “fractured” plan for existing customers, or how to Management, Senior
options codify “grandfathered” plans into Management,
budget and system Engineering
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Communicate plan Q4 2021 Finalize and launch Marketing, Public
changes to existing communications to existing Relations, Guides
customers customers on plan changes and Management,
benefits customers can realize GoDaddy Guides
from changing to new plan
Align Q4 2021 Customer benefits for new plans Marketing

communication for to be integrated into new
new customers marketing plans and campaigns
coinciding with Market
Penetration Strategy #5
Launch campaign Q1 2022 Campaign to be launched in Marketing

for new plans concert with e-commerce focused
plans from Market Penetration
Strategy #5
Launch new plans Q1 2022 Plans available for subscription Engineering,

on website, sign up and GoDaddy Guides,
onboarding process coded into L&D (to train
online system Guides on new
plans)
Analyze Q2 2022 Measure effectiveness of new Business

effectiveness of plans through increased Intelligence
new plans subscriber rate, length of
subscription, renewal rate,
overall revenue growth
Revise price points Q2 to Q4 Respond to data on effectiveness Marketing, Finance,

and 2022 with price changes, revisions to Senior Management,
communication as marketing campaigns, and/or GoDaddy Guides,
needed changes in customer service L&D, Guide
communication Management
Table 42 - Market Penetration #3 and 4

Talent Q1 2022 Identify high performing GoDaddy GoDaddy Guide
Identification Guides as candidates for initial training management,
Plan as Concierges and Migration Experts Human Resources
Training Q1 2022 Development of training program for GoDaddy L&D

Development GoDaddy Guides
Price Q1 2022 Determining appropriate price points Sales, Business

Planning for new premium Guide services Intelligence
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Marketing Q1 2022 Preparing external communications Marketing
Planning and marketing plan to introduce
Concierge and Migration services to
customers
Initial Q2 2022 Training of high performing Guides as GoDaddy L&D

training Concierges and Migration Experts
Soft launch End Q2 Availability of services as beta launch Guides, Guide

2022 without advertising to test customer Management,
satisfaction Business
Intelligence,
Marketing
Training End Q2 Establish wider training of larger GoDaddy L&D,

expansion 2022 numbers of Guides, with original Guide Management
trainees acting as mentors
Full launch Q3 2022 Launch of full marketing campaign and Marketing, Guides,
full availability to customers Guide Management
Results Q3-Q4 Monitor and analyze revenue, Guide Management,

Monitoring 2022 satisfaction, and expense (time spent) Business
of project Intelligence
Adjustment Q4 2022 Changes as needed in training program, GoDaddy L&D,

marketing campaign, deployment plan, Marketing, Guide
price points Management, Sales
Table 43 - Market Penetration #5

Raise budget to Q4 2021 2022 budget raised from 13% Finance, Senior
recommended level to 18% of expected yearly Management
revenue
Allocate new budget Q4 2021 Ensure extra 5% is already Finance, Senior

monies to e- allocated to e-commerce and Management,
commerce not domain or “brand Marketing
campaigns awareness” campaigns
Re-target non e- Q4 2021 End non e-commerce Marketing

commerce campaigns and advertising
campaigns to e- outside of the GoDaddy
commerce homepage
Design new and Q4 2021 Focus all new activity on e- Marketing,

effective e- commerce campaigns, Engineering
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commerce specifically related to
campaigns payments and Store Builder
Launch e-commerce Q1 2022 Launch new campaigns Marketing, Public

campaigns focused 100% on payments Relations
and Store Builder
Evaluate Q2 2022 Measure effectiveness of Business

effectiveness of campaigns through click rate, Intelligence
campaigns site visits, increase in
subscriptions
Revise and re-target Q2 2022 Ensure constant revision and Marketing, Business
campaigns retargeting of campaigns based Intelligence
on actionable data from
Business Intelligence to
achieve greatest results within
budget
Table 44 - Market Penetration #6 and Product Development #2

Create specific Q4 2021 Dedicated management and Senior
open-source engineering team to focus on open- Management,
team within source technology (not just hosting, Engineering, R&D,
management but Payments integration and Human Resources
technology to integrate into internal
tech)
Identify open- Q4 2021- Software code packages identified Engineering, R&D,

source Q1 2022 that are compatible and legal (based Legal
technology to on specific open-source license) to
add to internal add to GoDaddy codebase
products
Lower Q1 2022 Expand lower transaction fees Engineering,

transaction fees already on GoDaddy POS systems Finance
on GoDaddy to open-source Poynt by GoDaddy
Payments payment plugin for WordPress
Publicize new Q1 2022 Heavily advertising transaction fees Marketing

fees and options that are lower than competitors to
for open-source encourage increased adoption of
GoDaddy payment gateways
Monitor open- Q2 2022 Monitor adoption rates of GoDaddy Business

source adoption payment plugin, adjust strategies Intelligence,
accordingly Marketing
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Table 45 - Horizontal Integration #1 and Forward Integration #1

Identify targets Q4 2021 Financial and feasibility Business Intelligence,
for acquisition research report on acquisition Finance, Senior
targets in e-commerce and Management, Legal
payments spaces
Develop offer Q4 2021 Attain consensus on budget for Senior Management,

ranges for acquisition offers (up to $200 Finance
acquisitions million as per plan)
Discussions Q1 2022 Open discussions for friendly Senior Management,

with acquisition acquisition possibilities Legal, Acquisition
targets Target Management
Make initial Q2 2022 Send speculative contracts for Legal, Finance,

offers negotiation to acquisition targets Acquisition Target
Management
Sign Q3 2022 Finalize acquisition agreements Legal, Finance, Senior

agreements with targets Management,
Acquisition Target
Management
Announce Q3 2022 External and internal Public Relations,

acquisitions communications plan to Human Resources,
promote acquisition and benefits Marketing
to GoDaddy
Complete Q4 2022 Pay for acquisitions, integrate Finance, Human

acquisitions acquisition workforce into Resources, Engineering,
GoDaddy, begin integrating Senior Management
technology into GoDaddy tech
stack
Table 46 - Horizontal Integration #2 and Forward Integration #2

Identify Q4 2021 Examine feasibility of partnering Business Intelligence,
opportunities for with competitors or adjacent Finance, Legal, Senior
partnerships international players in markets Management
Initial contacts Q1 2022 Open discussion with partners to Senior Management,

with potential discuss ideas for partnerships Legal, Finance
partners
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Propose Q1-2 2022 Finalize partnership agreements, Senior Management,
partnership research technology Legal, Finance,
agreements compatibility requirements Engineering
Announce/launch Q2 2022 Start partnership work Marketing, Line

partnership (immediate launch or technical Management,
efforts work to integrate technology or Engineering, Sales,
payment system) Guides
Table 47 - Product Development #1

Raise budget to Q4 2021 Prepare 2022 budget to include Finance, Senior
recommended 20% of estimated revenue Management
level dedicated to R&D
Allocate new Q4 2021 Clearly divert increased budget to Finance, R&D

budget to e- e-commerce research projects
commerce targets
Re-target domain Q4 2021 Suspend domain-based research Engineering, Human

research into and communicate reasons to Resources, R&D
projects connected research teams
to e-commerce
Evaluate Q1 to Q2 Constant evaluation through Senior Management,

effectiveness of 2022 weekly/monthly reviews with Engineering, R&D
research projects management on research
progress
Re-distribute Q3 2022 Choose successful and most Senior Management,

budget to promising projects and divert Finance, R&D
successful and budget to support those as much
profitable projects as possible
8.3 Financial Projections
8.3.1 List of Assumptions
Table 48 - List of Financial Assumptions for Projections
Account Assumptions
Financial Statement FY 2018-2020 taken from audited and SEC-registered 10-
K Financial Statements available in Appendix B. FY 2021
numbers for the full year extrapolated from announced Q2
2021 results published and SEC-registered. Projections for
FY 2022-2024 based on meeting financial objective of
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Account Assumptions
38% SaaS CAGR for these three years and consistent 15%
CAGR for Domain vertical.
Cash and cash equivalents Updated based on projected Cash Flow Statement
Short-term investments At $0 based on 2020 divestiture of all short-term

investments, with $200 million in short-term investments
projected in 2023 to provide estimated $210 million in
positive net cash in 2024 from investment maturity
Accounts and other Increase based on historical growth of AR compared to

receivables revenue
Registry deposits Projected to increase 25% YoY as of 2023 as GoDaddy

integrates Neustar registry into regular business processes
Prepaid domain name registry Projected to increase 25% YoY as of 2023 as domain
fees registry deposits become more linked to all-in-one bundle
plans as part of strategic action plans
Prepaid expenses and other Projected to grow in line with revenue, cash flow, and
current assets preparation to pay out long-term debt (prepaid expenses
for paying debt early if needed)
Property and equipment, net Static until 2024 when projected to drop $100 million as
GoDaddy divests from internally-owned data center and
continues moving to fully cloud-based (schedule based on
2020 annual report commentary)
Operating lease assets Projected to drop in line with historical trend as well as
greater drop in 2024 due to divestiture of leased
property/global data centers
Prepaid domain registry fees, Growing but at slower rate than current prepaid domain
net of current position registry fees as pre-payments are more commonly annual
than multi-year (GoDaddy, Inc., 2021)
Goodwill Projected to increase according to historical trend as

GoDaddy continues to acquire/develop additional
intellectual property and maintain/build brand equity
Intangible assets, net Projected to increase according to historical trend and plan
for further acquisitions
Other assets Maintained at current historical level, slight drop due to

higher focus on acquisitions and rebranding of current
products
Accounts payable Projected to grow at 3% of revenues each year

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Account Assumptions
Other current liabilities Projected at 67% of revenues each year; deferred revenue
(including accrued expenses to increase as customers increasingly buy multi-year
and deferred revenue) subscription agreements to lock in prices
Long term debt Plan to pay down $1 billion of long term debt each year
2022-2024
Operating lease liabilities Projected to drop in line with historical trend as well as
plan to divest of physical assets
Additional paid-in capital Increasing by $400 million per year based on historical
trend as well as plan to make stockholder’s equity positive
after TRA settlement
Accumulated Deficit Slowly improving to be positive with retained earnings by

2027 – could turn positive earlier by using paid-in capital
to issue additional common stock upon board decision
Revenue – Domains Projected to grow stably 15% YoY based on current

market dominance and industry CAGR
Revenue – Hosting and Projected to grow 28% 2022, 36% 2023, and 40% 2024
Presence inline with industry CAGR and strategic market share
objective
Revenue – Business Projected to grow 28% 2022, 36% 2023, and 40% 2024
Applications inline with industry CAGR and strategic market share
objective
Cost of revenue Projected to be ~35% of total revenue as per historical

trend
Technology and development Projected at 20% of total revenue as per strategic

recommendation to increase R&D budget
Marketing and advertising Projected at 18% of total revenue as per strategic

recommendation to increase ad spend
Customer Care Projected at 9% of total revenue – target reached in 2020

after restructuring of Customer Care division after
previous costs of ~12%
General and Administrative Projected at 11% of total revenue, based on historical

trend of costs sitting between 9-12% of revenue 2018-
2020
Depreciation and Decreasing based on historical trend as GoDaddy divests

Amortization itself of physical assets in its move to cloud-based
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Account Assumptions
Interest expense Decreasing as GoDaddy makes plans to pay off long-term

debt and interest payments associated with said debt
8.3.2 Projected Balance Sheet
Table 49 - Balance Sheet Projection - Horizontal Analysis

(in $millions) 2020 2021 2022 2023 2024 '21-'22 '22-'23 '23-'24 CAGR
Assets
Current assets:
Cash and cash equivalents 765.2 1950.4 1690 1461 2307 -13.35% -13.55% 57.91% 16.84%
Short-term investments 0 0 0 200 0 0.00% -100.00%
Accounts and other 41.8 54.6 89 113 147 63.00% 26.97% 30.09% 28.52%
receivables
Registry deposits 31.1 31 32 40 50 3.23% 25.00% 25.00% 25.00%
Prepaid domain name 392.4 426.5 435 550 723 1.99% 26.44% 31.45% 28.92%
registry fees
Prepaid expenses and other 60.8 74.8 69 90 110 -7.75% 30.43% 22.22% 26.26%
current assets
Total current assets 1291.3 2537.3 2315 2454 3337 -8.76% 6.00% 35.98% 20.06%
Property and equipment, net 257.3 226.3 226 226 126 -0.13% 0.00% -44.25% -25.33%
Operating lease assets 142 114.4 106 80 29 -7.34% -24.53% -63.75% -47.69%
Prepaid domain registry fees, net 176.1 189.9 190 205 215 0.05% 7.89% 4.88% 6.38%
of current position
Goodwill 3275.1 3525.2 3825 4125 4425 8.50% 7.84% 7.27% 7.56%
Intangible assets, net 1255.1 1229.7 1530 1830 2130 24.42% 19.61% 16.39% 17.99%
Other assets 36 65.4 62 54 51 -5.20% -12.90% -5.56% -9.30%
Total non-current assets 5141.6 5350.9 5939 6520 6976 10.99% 9.78% 6.99% 8.38%
TOTAL ASSETS 6432.9 7888.2 8254 8974 10313 4.64% 8.72% 14.92% 11.78%
Liabilities and stockholders' equity (deficit)

Accounts payable 51 77.4 134 170 221 73.13% 26.87% 30.00% 28.42%
Accrued expenses and other 527.4 483.6 650 825 1114 34.41% 26.92% 35.03% 30.91%
current liabilities
Deferred revenue 1711.3 1871.4 2320 2947 3800 23.97% 27.03% 28.94% 27.98%
Long-term debt 24.3 24.1 23 20 15 -4.56% -13.04% -25.00% -19.24%
Payable pursuant to tax 0.2 0 0 0 0
Total current liabilities 2314.2 2456.5 3127 3962 5150 27.29% 26.70% 29.98% 28.33%
Deferred revenue, net of current 725.1 767 870 1178 1587 13.43% 35.40% 34.72% 35.06%
portion
Long-term debt, net of current 3090.1 3869.3 2869 1869 869 -25.85% -34.86% -53.50% -44.96%
portion
Operating lease liabilities, net of 166.7 153.4 150 120 105 -2.22% -20.00% -12.50% -16.33%
current portion
Payable pursuant to tax 0 0 0 0 0
current portion
Other long-term liabilities 56.6 62.4 75 85 95 20.19% 13.33% 11.76% 12.55%
Deferred tax liabilities 92 84.9 245 315 420 188.57% 28.57% 33.33% 30.93%
GODADDY, INC. 153
(in $millions) 2020 2021 2022 2023 2024 '21-'22 '22-'23 '23-'24 CAGR
Total non-current 4130.5 4937 4209 3567 3076 -14.75% -15.25% -13.77% -14.51%
liabilities
Commitments and contingencies

value
Class A common stock, 0.2 0.2 0.2 0.2 0.2 0.00% 0.00% 0.00% 0.00%
$0.001 par value
$0.001 par value
Additional paid-in capital 1308.8 1458 1866 2290 2695 27.98% 22.72% 17.69% 20.18%
Retained Earnings -1190.9 -883.1 -861 -733 -491 -2.50% -14.87% -33.02% -24.48%
Accumulated other -131 -82.3 -90 -115 -119 9.36% 27.78% 3.48% 14.99%
comprehensive loss
Total stockholders' equity -12.9 492.8 915.2 1442.2 2085.2 85.71% 57.58% 44.58% 50.94%
(deficit) attributable to GoDaddy
Inc.
Non-controlling interests 1.1 1.9 2.8 2.8 1.8 47.37% 0.00% -35.71% -19.82%
Total stockholders' equity -11.8 494.7 918 1445 2087 85.57% 57.41% 44.43% 50.78%
(deficit)
TOTAL LIABILITIES AND 6432.9 7888.2 8254 8974 10313 4.64% 8.72% 14.92% 11.78%
EQUITY
Table 50 - Balance Sheet Projection - Vertical Analysis

(in $millions) 2021 2022 2023 2024 2021 2022 2023 2024
Assets
Current assets:
Cash and cash equivalents 1950.4 1690 1461 2307 24.73% 20.47% 16.28% 22.37%
Short-term investments 0 0 200 0 0.00% 0.00% 2.23% 0.00%
Accounts and other 54.6 89 113 147 0.69% 1.08% 1.26% 1.43%
receivables
Registry deposits 31 32 40 50 0.39% 0.39% 0.45% 0.48%
Prepaid domain name 426.5 435 550 723 5.41% 5.27% 6.13% 7.01%
registry fees
Prepaid expenses and 74.8 69 90 110 0.95% 0.84% 1.00% 1.07%
other current assets
Total current assets 2537.3 2315 2454 3337 32.17% 28.05% 27.35% 32.36%
Property and equipment, net 226.3 226 226 126 2.87% 2.74% 2.52% 1.22%
Operating lease assets 114.4 106 80 29 1.45% 1.28% 0.89% 0.28%
Prepaid domain registry fees, 189.9 190 205 215 2.41% 2.30% 2.28% 2.08%
Goodwill 3525.2 3825 4125 4425 44.69% 46.34% 45.97% 42.91%
Intangible assets, net 1229.7 1530 1830 2130 15.59% 18.54% 20.39% 20.65%
Other assets 65.4 62 54 51 0.83% 0.75% 0.60% 0.49%
Total non-current assets 5350.9 5939 6520 6976 67.83% 71.95% 72.65% 67.64%
TOTAL ASSETS 7888.2 8254 8974 10313 100.00% 100.00% 100.00% 100.00%
Liabilities and stockholders' equity (deficit)

GODADDY, INC. 154
(in $millions) 2021 2022 2023 2024 2021 2022 2023 2024
Accounts payable 77.4 134 170 221 0.98% 1.62% 1.89% 2.14%
Accrued expenses and 483.6 650 825 1114 6.13% 7.87% 9.19% 10.80%
Deferred revenue 1871.4 2320 2947 3800 23.72% 28.11% 32.84% 36.85%
Long-term debt 24.1 23 20 15 0.31% 0.28% 0.22% 0.15%
Payable pursuant to tax 0 0 0 0 0.00% 0.00% 0.00% 0.00%
Total current liabilities 2456.5 3127 3962 5150 31.14% 37.88% 44.15% 49.94%
Deferred revenue, net of 767 870 1178 1587 9.72% 10.54% 13.13% 15.39%
current portion
Long-term debt, net of current 3869.3 2869 1869 869 49.05% 34.76% 20.83% 8.43%
portion
Operating lease liabilities, net 153.4 150 120 105 1.94% 1.82% 1.34% 1.02%
of current portion
Payable pursuant to tax 0 0 0 0 0.00% 0.00% 0.00% 0.00%
current portion
Other long-term liabilities 62.4 75 85 95 0.79% 0.91% 0.95% 0.92%
Deferred tax liabilities 84.9 245 315 420 1.08% 2.97% 3.51% 4.07%
Total non-current 4937 4209 3567 3076 62.59% 50.99% 39.75% 29.83%
liabilities

value
Class A common stock, 0.2 0.2 0.2 0.2 0.00% 0.00% 0.00% 0.00%
$0.001 par value
Class B common stock, $0.001 par value
Additional paid-in capital 1458 1866 2290 2695 18.48% 22.61% 25.52% 26.13%
Retained Earnings -883.1 -861 -733 -491 -11.20% -10.43% -8.17% -4.76%
Accumulated other -82.3 -90 -115 -119 -1.04% -1.09% -1.28% -1.15%
comprehensive loss
Total stockholders' equity 492.8 915.2 1442.2 2085.2 6.25% 11.09% 16.07% 20.22%
GoDaddy Inc.
Non-controlling interests 1.9 2.8 2.8 1.8 0.02% 0.03% 0.03% 0.02%
Total stockholders' 494.7 918 1445 2087 6.27% 11.12% 16.10% 20.24%
equity (deficit)
TOTAL LIABILITIES 7888.2 8254 8974 10313 100.00% 100.00% 100.00% 100.00%
AND EQUITY
The vertical analysis of the balance sheet show that non-current liabilities make up
almost two-thirds of GoDaddy’s total liabilities in 2021. Therefore, major impacts on the
balance sheet include the deliberate paying down of long-term debt by $1 billion each year,
an increase in goodwill due to the value of previous and projected acquisitions ($200 million
budgeted for acquisitions in 2022 as seen on the Cash Flow Statement below), an increase in
GODADDY, INC. 155
deferred revenue (due to greater amounts of longer-term prepaid subscription agreements)
and an increase in paid-in capital, all giving GoDaddy greater flexibility later in the projected
period – based on the results of the strategic recommendations, they will be able to obtain
additional capital through debt if needed, or move paid-capital into stockholders’ equity
through stock buy-backs, dividends, or other profit-sharing activities (if the strategies are
more successful than projected).
8.3.3 Projected Income Statement
Table 51 - Income Statement Projection - Horizontal Analysis

(in $millions) 2020 2021 2022 2023 2024 '21-'22 '22-'23 '23-'24 CAGR
Revenue
Domains 1515.1 1718.8 1976.62 2273.11 2614.09 15.00% 15.00% 15.00% 15.00%
Hosting and Presence 1200.6 1257.6 1609.73 2189.23 3064.92 28.00% 36.00% 40.00% 37.99%
Business Applications 601 688.4 881.15 1198.37 1677.71 28.00% 36.00% 40.00% 37.99%
Total Revenue 3316.7 3664.8 4467.50 5660.71 7356.72 21.90% 26.71% 29.96% 28.32%
Cost of revenue (excluding 1158.6 1306.4 1592.54 2017.89 2622.47 21.90% 26.71% 29.96% 28.32%
Technology and development 560.4 716.8 893.50 1132.14 1471.34 24.65% 26.71% 29.96% 28.32%
Marketing and advertising 438.5 518.4 804.15 1018.93 1324.21 55.12% 26.71% 29.96% 28.32%
Customer care 316.9 313.8 402.08 509.46 662.10 28.13% 26.71% 29.96% 28.32%
General and administrative 323.8 359.8 491.43 622.68 809.24 36.58% 26.71% 29.96% 28.32%
Restructuring charges 43.6 0 0.00 0.00 0.00
Depreciation and amortization 202.7 198 193.00 188.00 182.00 -2.53% -2.59% -3.19% -2.89%
Total costs and operating 3044.5 3413.2 4376.69 5489.10 7071.36 28.23% 25.42% 28.83% 27.11%
expenses
Operating Income 272.2 251.6 90.81 171.61 285.35 -63.91% 88.98% 66.28% 77.27%
Interest expense -91.3 -90 -70.00 -50.00 -30.00 -22.22% -28.57% -40.00% -34.53%
Loss on debt extinguishment 0 0 0.00 0.00 0.00

Tax receivable agreements -674.7 0 0.00 0.00 0.00
Other income (expense), net -1.6 -0.4 0.00 0.00 0.00 -100.00%
Income (loss) before income taxes -495.4 161.2 20.81 121.61 255.35 -87.09% 484.40% 109.98% 250.30%
Benefit (provision) for income 1.3 16.12 2.08 6.08 -12.77 -87.09% 192.20% -309.98% -147.70%
taxes
Net income (loss) -494.1 177.32 22.89 127.69 242.59 -87.09% 457.84% 89.98% 225.54%
Less: net income attributable to 1 0.2 0.00 0.00 0.00 -100.00%

non-controlling interests
Net income (loss) attributable to -495.1 177.12 22.89 127.69 242.59 -87.08% 457.84% 89.98% 225.54%
GoDaddy Inc.
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Table 52 - Income Statement Projection - Vertical Analysis

(in US $ millions) 2021 2022 2023 2024 2021 2022 2023 2024
Revenue
Domains 1718.80 1976.62 2273.11 2614.08 46.90% 44.24% 40.16% 35.53%
Hosting and Presence 1257.60 1609.73 2189.23 3064.92 34.32% 36.03% 38.67% 41.66%
Business Applications 688.40 881.15 1198.37 1677.71 18.78% 19.72% 21.17% 22.81%
Total Revenue 3664.80 4467.50 5660.71 7356.72 100.00% 100.00% 100.00% 100.00%
Cost of revenue (excluding 1306.40 1592.54 2017.89 2622.47 38.27% 36.39% 36.76% 37.09%
Technology and development 716.80 893.50 1132.14 1471.34 21.00% 20.41% 20.63% 20.81%
Marketing and advertising 518.40 804.15 1018.93 1324.21 15.19% 18.37% 18.56% 18.73%
Customer care 313.80 402.08 509.46 662.10 9.19% 9.19% 9.28% 9.36%
General and administrative 359.80 491.43 622.68 809.24 10.54% 11.23% 11.34% 11.44%
Restructuring charges 0.00 0.00 0.00 0.00 0.00% 0.00% 0.00% 0.00%
Depreciation and amortization 198.00 193.00 188.00 182.00 5.80% 4.41% 3.42% 2.57%
Total costs and operating expenses 3413.20 4376.69 5489.10 7071.36 100.00% 100.00% 100.00% 100.00%
Operating Income 251.60 90.81 171.61 285.35 6.87% 2.03% 3.03% 3.88%
Interest expense -90.00 -70.00 -50.00 -30.00 -2.46% -1.57% -0.88% -0.41%
Loss on debt extinguishment 0.00 0.00 0.00 0.00 0.00% 0.00% 0.00% 0.00%
Tax receivable agreements liability 0.00 0.00 0.00 0.00 0.00% 0.00% 0.00% 0.00%
adjustment
Other income (expense), net -0.40 0.00 0.00 0.00 -0.01% 0.00% 0.00% 0.00%
Income (loss) before income taxes 161.20 20.81 121.61 255.35 4.40% 0.47% 2.15% 3.47%
Benefit (provision) for income taxes 16.12 2.08 6.08 -12.77 0.44% 0.05% 0.11% -0.17%
Net income (loss) 177.32 22.89 127.69 242.59 4.84% 0.51% 2.26% 3.30%
Less: net income attributable to non- 0.20 0.00 0.00 0.00 0.01% 0.00% 0.00% 0.00%
controlling interests
Net income (loss) attributable to 177.12 22.89 127.69 242.59 4.83% 0.51% 2.26% 3.30%
GoDaddy Inc.
The projected balance statement horizontal analysis highlights the targeted revenue
growth percentages for each vertical to meet the financial objectives set by the company;
progressive growth within the SaaS e-commerce verticals (Hosting and Presence and
Business Applications) resulting in a 38% CAGR 2022-2024, and a consistent 15% growth
rate in the domain vertical, where GoDaddy is already the dominant market leader. This
results in a 28% CAGR for the company as a whole, which matches the industry historical
CAGR (the financial objective of 38% is specifically for the SaaS verticals only). Net income
GODADDY, INC. 157
percentages in the horizontal analysis are affected by the disruption caused by the TRA
settlement in 2020.
The vertical analysis highlights that net income, while projected to drop in 2021-2
compared to total revenue due to the investments in R&D and advertising required by the
strategic recommendations, recovers by 2024 due to the results of the strategies as well as a
steady benefit on income taxes, as the income tax benefit previously paid to the pre-IPO
owners as a result of the TRA is now directly attributable to GoDaddy rather than being paid
out. By 2024, GoDaddy’s revenues have risen significantly enough that they are projected to
have a slight income tax obligation, as compared to previously when advantageous tax
agreements gave them a financial benefit instead.
8.3.4 Projected Cash Flow Statement
Table 53 - Cash Flow Statement Projection
(in $millions) 2020 2021 2022 2023 2024

Operating activities
Net income (loss) -494.1 177.12 22.891 127.692 242.587
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization 202.7 198 193 188 182
Equity-based compensation 191.5 226 260.5 295 329.5
Non-cash restructuring charges 29 0 0 0 0
Loss on debt extinguishment 0 0 0 0
Tax receivable agreements liability 674.7 0 0 0 0
adjustment
Other 32.7 33.6 50 65 80
Changes in operating assets and
liabilities, net of amounts acquired:
Registry deposits -2.7 -3 -4 -5 -6
Prepaid domain name registry fees -17.5 -35.6 -53.7 -71.8 -89.9
Accounts payable -20.5 30.4 56.6 36 51
Accrued expenses and other current 22.3 18.7 20 20 20
liabilities
Deferred Revenue 215.6 412 502.24 636.382 827.048
Other operating assets and liabilities -69.1 -54.14 -63 -63 -63
Net cash provided by operating 764.6 1003.08 984.531 1228.274 1573.235
activities
Investing activities
Purchases of short-term investments 0 0 -200 0
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(in $millions) 2020 2021 2022 2023 2024

Maturities of short-term investments 23.7 0 0 0 210
Business acquisitions, net of cash acquired -424.7 -320.1 -200 0 0
Purchases of intangible assets -15 -9.8 -10 -10 -10
Purchases of property and equipment -66.5 -42.2 -40 -40 -40
Other investing activities, net 0.2 -8.9 0 0 0
Net cash used in investing activities -482.3 -381 -250 -250 160
Financing Activities
Proceeds received from:
Issuance of term loans 746.3
Issuance of Senior Notes 800
Stock option exercises 77.7 51.6 70 70 70
Issuance of Class A common stock 29.6 33.12 36.64 40.16 43.68
under employee stock purchase plan
Payments made for:
Settlement of tax receivable agreements -849.8 0 0 0 0
Repurchases of Class A Common Stock -541.7 -275.9 -93.371 -106.634 -192.715
Repayment of term loans -28.7 -32.4 -1000 -1000 -1000
Financing-related costs -6.4 0 0 0 0
Contingent consideration for business -0.5 0 0 0 0
acquisitions
Other financing obligations -8.2 -12.5 -10 -10 -10
Net cash provided by (used in) financing -581.7 563.92 -996.731 -1006.474 -1089.035
activities
Effect of exchange rate changes on cash 1.8 -0.8 1.8 -0.8 1.8
and cash equivalents
Net increase (decrease) in cash and cash -297.6 1185.2 -260.4 -29 646
equivalents
Cash and cash equivalents, beginning of 1062.8 765.2 1950.4 1690 1661
period
Cash and cash equivalents, ending of 765.2 1950.4 1690 1661 2307
period
The projected cash flow statement highlights where the cash is coming from and
going in the projected years. Notable entries include the issuance of $800 million worth of
senior notes by GoDaddy in 2021 (which has already occurred), giving GoDaddy some
flexibility in how to spend its cash in future years. The regular increase in equity-based
compensation is standard for the technology industry – the addition of stock options for
employees as part of their salary package has become more frequent in recent years and is
only set to increase as tech companies compete for the best talent (Schneider, 2020).
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The increase in net cash provided by operating activities, spurred by the increase in
deferred revenue due to higher subscription rates and greater GMV through GoDaddy’s
payment portals, allows GoDaddy to budget $1 billion each projected year to repay its long-
term debt proactively, allowing it more flexibility in the future to take out additional debt if
needed to meet objectives or acquire strategically valuable companies within the industry.
Additional notable entries in the cash flow statement include a budget of $200 million for
strategic acquisitions in 2022 and a provision for $200 million for short-term investment in
2023, which manifests with a 5% ROI in 2024. At the end of the projected period, GoDaddy’s
net cash and cash equivalents give it numerous options going forward, whether it is
continuing the strategic direction as outlined in this paper’s recommendation, increasing
investment, or returning value back to shareholders through dividends or other methods.
8.3.5 Projected Growth Rate and Market Share Changes
In order to reach a projected 38% e-commerce CAGR over the years 2022-2024,
GoDaddy needs to massively increase its revenue generation in the SaaS e-commerce space.
To do so, it can combine organic growth with the extra growth projected to arise from the
recommended strategies listed earlier in this paper. In order to achieve the extra growth,
many of the strategies involve taking market share away from competitors in order to achieve
market share growth comparative to the other four of the Top 5 players in the market
(Shopify, Wix, SquareSpace, and BigCommerce). The largest growth rate will be projected to
occur in 2022 as GoDaddy makes the most changes compared to current business strategies
by increasing its R&D and advertising budgets and targeting existing customers in the space
by highlighting its value compared to competitors, offering migration services, and bundling
additional tools into its competitively-priced subscription offerings.
Growth rates were projected by using strategies recommended in this paper as well as
earnings reports and projections of the competitors themselves. Even with aggressive
GODADDY, INC. 160
strategies by GoDaddy, all companies in the comparison set will grow – the e-commerce
space is growing quickly enough to allow for this. However, the aim is to grow more quickly
than the others, even if Shopify will still remain the overall revenue leader. For example,
Shopify has publicly stated in their 2021 Q2 earnings report that they do not expect their
current growth rates to continue once the COVID-19 pandemic ends (Shopify, Inc., 2021).
Table 54 - EY 2022 Growth Projections (in $millions)
Company EY 2022 EY 2022 EY 2022 Change in

Growth Revenue Market Share Market Share
Shopify 30% 5460 51.49% +1.58%
GoDaddy 28% 2490.88 23.66% +0.37%
Wix 18% 1464.4 13.81% -0.94%
SquareSpace 14% 880.08 8.30% -0.87%
BigCommerce 18% 233.64 2.20% -0.15%
Figure 36 - EY 2022 Growth Projections - Organic vs Strategies
In 2022 GoDaddy will add 16% extra growth on top of its organic 12% growth
naturally projected from current results. This will be a result of its aggressive moves to take
customers away from the competition and also aggressively promote and expand its payment
systems, as it has already begun to do in 2021 with its POS systems (FinExtra, 2021). All of
the other companies will continue to grow organically, with Shopify remaining the market
leader by far, but their growth rates will be slightly slowed by both the end of the pandemic
(as predicted by Shopify) as well as GoDaddy’s aggressive strategies to attack them directly.
GODADDY, INC. 161

Shopify 28% 6988.8 52.19% +0.70%
GoDaddy 36% 3387.6 25.49% +1.84%
Wix 14% 1669.44 12.47% -1.34%
SquareSpace 12% 985.69 7.36% -0.94%
BigCommerce 10% 257.00 1.92% -0.28%
In 2023 GoDaddy is projected to build on its 2022 growth by another 8% while it
slows down Shopify by another 2% compared to the previous year. As migrations and
payments become more successful and prevalent, even while Shopify continues its growth,
GoDaddy is beginning to regain ground. Wix, SquareSpace, and BigCommerce, none of
which have the financial capacity to truly compete with Shopify or GoDaddy in actively
pursuing customers, see much more limited growth as they have to rely on more conservative
and organic marketing over the aggressive campaigns of the top two.

Shopify 26% 8805.89 52.12% -0.07%
GoDaddy 40% 4742.6 28.61% +2.82%
Wix 10% 1836.39 10.87% -1.60%
SquareSpace 10% 1084.26 6.42% -0.94%
BigCommerce 10% 282.71 1.67% -0.25%
GODADDY, INC. 162
By 2024, GoDaddy’s strategies are well-established and will only add an additional
4% of growth based on new strategies, and slow Shopify by another 2% from the previous
year. By this time the smaller three competitors (Wix, SquareSpace, and BigCommerce) are
only growing at a minimal 10% rate. Shopify, while still clearly the market leader in terms of
market share, is only growing at 26%. GoDaddy, while still in second place in overall market
share, has the largest growth of the five, and is the only company to actually gain market
share in 2024, with a positive 2.82% change, achieving the strategic goal of being the premier
SaaS e-commerce platform in terms of gaining market share.
Table 57 - Changes in Market Share and CAGR 2022-2024
Company Initial Market EY 2024 Change in CAGR 2022-

Share 2021 Market Share Market Share 2024
Shopify 49.91% 52.12% +2.21% 27%
GoDaddy 23.82% 28.31% +5.03% 38%
Wix 14.75% 10.87% -3.88% 12%
SquareSpace 9.18% 6.42% -2.76% 11%
BigCommerce 2.35% 1.67% -0.68% 10%
Figure 39 - Market Share and Growth Rate Changes 2022-2024

GODADDY, INC. 163
GoDaddy’s aggressive growth projections compared to Shopify and the other
competitors only result in a small change in overall market share, due to the continued
growth of the SaaS e-commerce industry. None of the competitors are projected to go
bankrupt or shrink; the projections only show a slowing of growth rate. As Shopify and
GoDaddy are the largest companies in terms of assets and revenue, they are projected to be
the main players going into 2024 while the other three competitors grow much more slowly
due to their lack of ability to compete in terms of research and advertising spending.
8.3.6 Projected Financial Ratios
Table 58 - Select Projected Financial Ratios 2022-2024
Financial 2022 2023 2024 Hist. Proj. Remarks

Ratio Avg. Avg.
Current Ratio 0.740 0.619 0.648 0.701 0.669 GoDaddy continues to maintain a
similar current ratio to the previous
three years and can continue to meet
short-term obligations
Debt/Equity 3.150 1.307 0.424 3.234* 1.627 GoDaddy’s D/E ratio drops
Ratio significantly 2022-2024 as GoDaddy
proactively pays down its long-term
debt by $1 billion/year, providing extra
flexibility for GoDaddy to incur more
debt in future for strategic acquisitions
or increased budget for R&D or
advertising if necessary
Operating 2.033% 3.032% 3.879% 6.871% 2.981% Operating margin starts off much
Margin lower than previous years due to
increased investment in both R&D and
advertising per strategic
recommendations – begins to approach
previous levels in 2024
Net Profit 0.513% 2.256% 3.298% 4.299%* 2.022% Similar to operating margin, lower in
Margin 2022 due to increased investment in
expenses to meet strategic objectives
Return on 2.493% 8.837% 11.624% 16.357%* 7.651% After the considerable investment to
Equity spur the high growth needed to meet
objectives, ROE approaches previous
levels in 2024
Asset Turnover 0.541 0.631 0.713 0.476 0.628 An increasing asset turnover shows
that GoDaddy is generating a better
volume of business compared to the
size of its asset investment
Receivable 50.197 50.095 50.046 93.018 50.112 Time to collect credit sales increases
Turnover due to increased amount and length of
subscriptions due to all-in-one plan
detailed in strategic recommendation
GODADDY, INC. 164
Financial 2022 2023 2024 Hist. Proj. Remarks

Ratio Avg. Avg.
Days in 7.271 7.286 7.293 3.971 7.284 Days to collect receivables still much
Receivables less than Shopify (due to Shopify
Capital) and similar to Wix receivable
schedules – good/average for industry
* Historical averages calculated without effect of TRA settlement in 2020 to provide realistic ratio numbers
9. Strategy Evaluation, Monitoring, and Control
9.1 Balanced Scorecard
In order to track the progress of the company’s movement towards achieving the goals
listed in the Strategy Map, a Balanced Scorecard can be created with measured and time-
bound targets connected to each strategic objective on the Strategy Map. Initiatives can then
be created around each target to ensure continued movement towards the strategic goals. The
proposed Balanced Scorecard for GoDaddy, Inc. with objectives, measures, and targets, is
presented below, followed by descriptions of the initiatives to achieve the measured targets.
Table 59 - Balanced Scorecard for GoDaddy, Inc.
Perspective Objective Measure Target

Financial To grow market Revenue compared 2022-4 CAGR = 38%
share to other Top 5 SaaS 2022 – 28%
e-commerce 2023 – 36%
platforms 2024 – 40%
Provide Adoption rate of By 2024: 50% of total customers

compelling value new all-in-one on bundled plans
proposition for all- bundle by
in-one e-commerce new/existing
solution customers
Maintain customer CS scores from Increase current 4.7/5 weighted

satisfaction internal surveys and score on TrustPilot to 4.9 by
TrustPilot 2023
Customers
Increase total EoY paid customer By 2024: Shift 50% of customers
number of e- count on e- on Managed WordPress plans
commerce commerce plans with e-commerce plugins to
customers GoDaddy E-Commerce plans,
and increase new enrollments of
e-commerce customers new to
GDDY by 50% YoY 2022-2024
GODADDY, INC. 165
Perspective Objective Measure Target

Focus advertising Ad spend centered 2022 – 100% of advertising
on e-commerce around e-commerce centered around e-commerce
2023-4 – Using ad spend per
revenue growth, ad budget
adjusted to meet growth targets
Internal
Business Increase Availability of 2022 – Adoption by 1% of open-
Processes technology base GoDaddy Payments source WordPress community
and reach (Poynt) 2023 – Adoption by 5% of WP
community
2024 – Adoption by 10% of WP
community
Internal awareness KPIs linked to e- All divisions of GoDaddy have

of importance of e- commerce KPIs linked to e-commerce
commerce growth
Learning
and
Specialized Completion of 50% of all GoDaddy Guides
Growth
training for GoDaddy Guide (based on individual CS scores)
monetized services training on trained on monetized services by
monetized services 2022
9.1.1 Financial Perspective
9.1.1.1 To grow market share
As the overarching financial objective of the company, the initiatives to achieve this
objective are aligned with the recommended strategies presented earlier in this paper,
including focusing marketing entirely on e-commerce as well as actionable strategies to
attract new customers and capture existing customers from competitors, thus increasing
revenue and market share.
9.1.2 Customer Perspective
9.1.2.1 Compelling value proposition for all-in-one e-commerce solution
One of the recommended ways for GoDaddy to distinguish itself from the
competition is to highlight and emphasize its additional business tools that are not available
on competitors’ plans, such as integrated e-mail, telephony, and other business tools. The
optimal way of accomplishing this is to create bundles of its hosting and e-commerce plans
GODADDY, INC. 166
along with its business tools, along with advertising that the total plan cost is still more cost
effective than comparable plans of GoDaddy’s main competitors. Connected with this is the
goal of ceasing to offer “fractured” plans of many different types and options, which can
cause confusion and ‘buyer’s remorse’ among customers shopping for a new plan (GoDaddy,
Inc., 2021). For existing customers who may, for various reasons, prefer to stay on their
current style of plan, they can be “grandfathered” in and allowed to keep their old plans,
which should still allow for the company to achieve the target of 50% of total customers on
bundled plans by 2024.
9.1.2.2 Maintain customer satisfaction
Customer satisfaction should remain a primary goal of GoDaddy, to retain the top
spot in weighted satisfaction scores as rated by TrustPilot (2021). Initiatives to support this
include continuing training and staffing levels for GoDaddy Guides (dedicated support
specialists), conducting internal surveys to determine additional ways to increase satisfaction
rate, and also by analyzing current pricing plans; the most common TrustPilot complaint
revolves around GoDaddy offering lower prices for the first year without announcing the
increase in price once the customer is locked into the platform. By creating the bundled price
project as recommended in this paper, the pricing will be entirely transparent and clear to the
customers, increasing satisfaction year on year until the target rating of 4.9/5 is reached.
9.1.2.3 Increase total number of e-commerce customers
In addition to finding new customers in the marketplace and taking existing customers
from competitors, GoDaddy should also be focusing on moving its own existing customers
from Managed WordPress hosting options to its proprietary Store Builder e-commerce
solution. As mentioned previously in this paper, WordPress, while a free and open-source
product with many customization options, is often difficult for non-tech-savvy merchants to
implement, and hosting and upgrade costs can increase much more quickly than the merchant
GODADDY, INC. 167
may expect compared to a proprietary SaaS product. GoDaddy, while gaining revenue from
Managed WordPress hosting, also has the challenge of competing with other WordPress
hosting providers as well as the creators of WordPress, Automattic, Inc.; if Automattic
decided in the future to become a public company and privatize its future code releases for
WordPress or WooCommerce (the e-commerce plugin), GoDaddy’s revenue stream could be
threatened (Young, et al., 2021). Finally, the overall margin of the proprietary platform versus
managed hosting is higher, as GoDaddy controls not only the hosting, but also any revenue
coming through the merchants’ store, through the GoDaddy Payments gateway.
As such, initiatives around moving Managed WordPress customers into the GoDaddy
proprietary ecosystem should include providing extra tools for merchants using Store Builder,
and internal customer advertising showing the benefits to the merchant in switching,
including cost savings, ease of updates and site management, and improved billing/payment
management as it is all consolidated with GoDaddy. This, plus the aforementioned strategic
recommendations to attract new customers, should help GoDaddy reach its targets by 2024.
9.1.3 Internal Business Processes Perspective
9.1.3.1 Focus advertising on e-commerce
This objective is directly addressed in the recommended strategies from earlier in this
paper. The current marketing and advertising budget for GoDaddy is approximately 13% of
yearly revenues. That budget should be increased to 18% of revenue (an increase of 5%)
starting in 2022, and the focus of all marketing and advertising should be entirely around e-
commerce, and specifically the GoDaddy Store Builder product and GoDaddy Payments
(whether through the Store Builder or through the WordPress plugin).
For succeeding years, the revenue growth for GoDaddy e-commerce should be
monitored to see if the increased ad spend and focus is affecting growth as predicted in the
Financial Objectives and targets, and adjusted accordingly. In addition, the growth of the
GODADDY, INC. 168
domain vertical in 2022-4 should also be monitored; the hypothesis of this paper is that as the
overwhelming market leader in the domain vertical, GoDaddy does not need to invest
spending in advertising for the domain vertical, but can rely on organic growth to maintain a
15% CAGR in the domain market throughout 2024. If it does not maintain the expected
growth levels, the ad spend should be re-adjusted accordingly.
9.1.3.2 Increase technology base and reach
Increasing the technology base of GoDaddy is one of the recommended strategies,
revolving around researching the possibility of acquiring smaller competitors or forward
integrating with payment processing companies. This should be aligned towards the goal of
increasing the reach of the GoDaddy Payments gateway, both through the proprietary Store
Builder as well as in the WordPress community.
For increased reach in Store Builder, where GoDaddy Payments is already the default
payment gateway, technology must be added to expand the reach of the gateway outside of
US-only payments. This can be done through forward integration of international payment
processors or the hiring of specific types of software engineers with the experience and
knowledge to integrate these payment possibilities.
To increase reach in the WordPress community, which has the greater overall
customer base, GoDaddy needs to make their product compelling as an alternative to current
payment options already available to WordPress users (including direct bank transactions,
Stripe Pay, and WooCommerce Payments). This can be done by investing in technology to
make the Poynt plugin easier to install, easier to set up, and with lower transaction fees than
the competitors. GoDaddy should also make the Poynt gateway the default e-commerce
payment plugin for any GoDaddy customer on a Managed WordPress plan.

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9.1.4 Learning and Growth Perspective
9.1.4.1 Internal awareness of importance of e-commerce
The highest priority for GoDaddy in this strategic management analysis is the
movement of GoDaddy towards e-commerce, not just in word, but in deed; even though the
existing vision and mission statements of the company are slanted towards ‘entrepreneurs,’
the company’s actions are still divided and fractured between many different products and
options that do not necessarily target e-commerce. This can be changed by an initiative of
promoting internal awareness of the importance of e-commerce; each business unit of the
company (including domains, hosting, payments, customer service, etc.) should create Key
Performance Indicators (KPIs) for their regular reviews that are in some way directly related
to e-commerce, whether it is number of domains connected to an e-commerce plan, number
of new customers on e-commerce plans, amount of GMV funneling through customers’
online stores, etc. This will ensure that each business unit regardless of function is aware and
participatory in the company’s full shift towards e-commerce. In addition, the executive team
of the company, led by the CEO, must spearhead a genuine culture-shift towards e-
commerce. Since GoDaddy did not start as an e-commerce SaaS provider like Shopify or
Wix, its foundational culture is different, and can explain the lack of full commitment by the
company. Only with a genuine push from the executive leadership to support the move, as
well as increased communication and accountability to e-commerce related KPIs, will
GoDaddy be able to fully shift the corporate focus to e-commerce.
9.1.4.2 Specialized internal training for monetized services
Another of the recommended strategies for GoDaddy is to start monetizing its
customer service and support, but only in a way that does not feel like a “cash grab” to
customers. The company can accomplish this by adding extra services for a fee that are not
already covered by the current free customer service, such as initial site set up and migration
GODADDY, INC. 170
from competitors’ platforms. With 70% of the workforce at GoDaddy consisting of GoDaddy
Guides involved directly in customer service, training all 6,000+ Guides on the monetized
services will most likely not provide a premium result for the customer should they choose to
pay. To identify the best Guides to be trained for the monetized services, the company can
look at each Guide’s individual customer satisfaction scores (using internal tools) and
incentivize volunteering for the monetized roles by offering some kind of bonus, either
revenue-sharing in the actual money gained from these services, or other non-monetary
bonuses. GoDaddy can also research the possibility of acquiring an external migration
company to bring into the company who can provide expert service on migrating from
another service to GoDaddy – a good strategic option may be to research the feasibility of
acquiring Cart2Cart, which is partly integrated with Wix’s product; purchasing this company
would prevent Wix from using this migration service and potentially affect their market share
(Wix, Inc., 2021).
9.2 Business Continuity and Risk Management Plan
As an established US company, GoDaddy regularly reports on the varying risk factors
that could affect its strategic, operational, and financial performance on its annual reports
registered with the Securities and Exchange Commission (GoDaddy, Inc., 2021). However,
they are not required to discuss their continuity and management plans for dealing with said
risk factors should they appear. Below are selected risk factors from GoDaddy’s most recent
annual report, as well as risks created from the recommended strategies in this paper, that
could potentially affect the continuity of the business. Included next to these factors are
recommended action plans for the company to deal with the situations should they arise.
GODADDY, INC. 171
Table 60 - Business Continuity Plan Based on Risk Factors
Risk Factor Recommended Action Plan

GoDaddy does not grow at Any projected plan is exactly that – projected. The
forecasted rates/competitors recommended strategies of GoDaddy may not work as
“fight back” planned – however, enough flexibility has been built into
the plan to adjust if the plans prove to be unsuccessful –
GoDaddy can pull back on the advertising/R&D budgets to
previous levels and focus on their growth alone versus
trying to capture market share from their competitors. They
may not achieve their strategic goal of being the “premier”
provider in terms of market share growth, but should still
have healthy growth percentages in the coming years,
greater than previously recorded.
New technology – paradigm The tech industry is fast moving, and sometimes tech
shift causes product to platforms that were the market leaders become obsolete
become obsolete (the almost overnight (think Yahoo, MySpace, AskJeeves, etc.).
“buggy whip” problem) GoDaddy must be prepared for this eventuality if the e-
commerce space encounters such a paradigm-shifting
technology; indeed, if Shopify diversifies to become a web
host/business tool provider as well as a store platform, and
makes their pricing more competitive, they could become
the dominant market leader in e-commerce as GoDaddy is
in domains. While GoDaddy’s brand recognition and
software will most likely prevent a competitor from making
them obsolete, they must be prepared for an unforeseen
entrant that disrupts the current business model. In that case,
if GoDaddy finds they cannot compete in the space any
longer due to a massive shift in technology, they can divest
their web hosting/e-commerce vertical and focus entirely on
their slower-growing but still dominant domain business,
which is not likely to become obsolete anytime soon due to
the brand power of domain names for businesses.
System failures/capacity GoDaddy already has a robust Systems team to ensure

constraints redundancy of service globally, and should continue to build
on their movement and migration to cloud services to ensure
that capacity can scale as their customers scale.
Reliance on third parties Recommendation already made to wean GoDaddy product

(AWS, WordPress) offerings away from WordPress Managed hosting and focus
on promoting its payment plugin on the open-source market
in addition to its proprietary Store Builder. GoDaddy can
prevent over-reliance on AWS cloud services by also
partnering with additional cloud services for redundancy
(Google Cloud, Digital Ocean, etc.).
Network attack/data GoDaddy must continue to adhere to the highest security

security incident standards to prevent data security breaches. Security team is
GODADDY, INC. 172
Risk Factor Recommended Action Plan

already in place to prevent/defend against network attacks;
team should be scaled along with customer growth as part
of administrative expenses to ensure continuing security.
Leak of confidential GoDaddy should maintain its high-level security policies

information around confidential information of customers, especially as
they move more heavily into the financial/payments space.
Acquisition research can be targeted towards payment
security companies to provide extra talent around protection
of confidential information.
Failure of customer care GoDaddy can partner with BPOs globally as needed to
provide extra GoDaddy Guide service if international
customers scale faster than GoDaddy can hire Guides
internally. This has been done in the past (Nolasco, 2021)
and focus should be on service over sales unless direct
GoDaddy hires.
Unable to source qualified GoDaddy has an advantage of already hiring on a global

talent scale, so location of talent is not an issue; however, if unable
to recruit enough talent to GoDaddy, the company can divert
some of its R&D budget into recruiting and general costs to
provide competitive salaries above competitors if needed to
secure the talent required to conduct the software
development needed to continually improve.
Failure of localized data GoDaddy leases most of its data centers globally but has a
centers/cloud services wholly-owned data center at its headquarters in Arizona;
this data center should be kept online as an emergency
backup in case leased centers have an operational failure
while moving to the cloud, and continued in a limited
capacity after the full migration to the cloud as a last resort
in case there is a systemic failure of any of their cloud
services. As previously noted, GoDaddy should also partner
with additional cloud services for extra redundancy.
GODADDY, INC. 173
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Appendices
Appendix A. Glossary of Terms and Abbreviations
Term/Abbreviation Meaning
2FA Two-Factor Authentication – a security measure for online logins
requiring a secondary passcode or confirmation
AOL America Online – legacy US internet service provider and
messaging platform
APAC Asia-Pacific
API Application Programming Interface – codebase of an online
software package designed to communicate and transfer information
to other software
AWS Amazon Web Services – an enterprise cloud services provider
B2B Business-to-Business – sales model
B2C Business-to-Consumer – sales model
BBB Better Business Bureau
BCG Boston Consulting Group
BIGC Stock ticker for BigCommerce
CAGR Compound Annual Growth Rate
CEO Chief Executive Officer
CMS Content Management System
CPM Competitive Profile Matrix
CPTPP Comprehensive and Progressive Agreement for Trans-Pacific
Partnership
CRM Customer Relationship Management
CS Customer Service
CSF Critical Success Factor
CTO Chief Technology Officer
DEI Diversity, Equity, and Inclusion
DHL Dalsey, Hillblom, and Lynn – global freight service named after
founders
DNS Domain Name Service – internet protocol that links IP addresses
(numeric) to domain names (.com, .org, etc.)
EFE External Forces Evaluation
EMEA Europe, Middle East, and Africa
EU European Union
EY Estimated Year – used to note fiscal years in financial projections
FAQ Frequently Asked Questions
FBA Fulfillment by Amazon – warehousing and shipping services
provided to merchants as a service by Amazon, Inc.
FY Financial/Fiscal Year
GDDY Stock ticker for GoDaddy, Inc.
GODADDY, INC. 182
GDPR General Data Protection Regulation – comprehensive data privacy
enforced by European Union
GMV Gross Merchandise Value – monetary value of all goods or service
flowing through an e-commerce platform
GSM Grand Strategy Matrix
HR Human Resources
ICANN Internet Corporation for Assigned Names and Numbers –
organization that licenses domain registrars and registries
ICQ “I Seek You” – legacy online messaging platform
IFE Internal Forces Evaluation
IPO Initial Public Offering
IT Information Technology
KPI Key Performance Indicator
L&D Learning & Development
LGBTQ Lesbian, Gay, Bisexual, Transgender, Queer
MSN Microsoft Network – legacy internet service provider and messaging
platform
NASDAQ National Association of Securities Dealers Automated Quotations –
secondary US stock exchange after NYSE
NYSE New York Stock Exchange
OS Operating System
POS Point-of-Sale – an online-facilitated business transaction (such as a
credit card payment) performed in person using a connected
terminal
QSPM Quantitative Strategic Planning Matrix
R&D Research and Development
ROE Return on Equity
ROI Return on Investment
SaaS Software-as-a-Service – the business model of offering software
over the Internet on a subscription model rather than charging a one-
time fee for a download
SAM Serviceable Available Market – the market segment currently
available to be serviced by a business based on their current status
SEC Securities and Exchange Commission – US regulatory body for
publicly-listed businesses
SEM Search Engine Marketing
SEO Search Engine Optimization
SHOP Stock ticker for Shopify, Inc.
SMB Small to Medium Business – generally referring to a service
business
SME Small to Medium Enterprise – generally referring to a small
company involved in manufacturing/creating products
GODADDY, INC. 183
SPACE Strategic Position and Action Evaluation
SQSP Stock ticker for SquareSpace, Inc.
SVP Senior Vice President
SWOT Strengths, Weaknesses, Opportunities, and Threats
TAM Total Available Market – total potential market segment available to
a company
TLD Top-Level Domain – endings of internet addresses such
as .com, .org, .ph, .info
TOS Terms of Service
TRA Tax Receivable Agreement
UPS United Parcel Service
URL Universal Resource Locator – another name for an internet address
using a domain name
VAT Value-Added Tax
VOIP Voice Over Internet Protocol – telephone services using internet
rather than legacy telephony infrastructure
WHOIS Database of owners/registrants of internet domain names
YoY Year-on-Year
GODADDY, INC. 184
Appendix B. Financial Statements for GoDaddy, Inc., 2018-2020
All statements taken from US SEC-registered 10-K Annual Reports (GoDaddy, Inc.,
2021).
GoDaddy Inc.
Consolidated Balance Sheets
(In millions, except shares in thousands and per share amounts)
December 31,
2018 2017
Assets
Current assets:
Cash and cash equivalents $ 932.4 $ 582.7
Short-term investments 18.9 12.3
Accounts and other receivables 26.4 18.4
Registry deposits 28.3 34.7
Prepaid domain name registry fees 363.2 351.5
Prepaid expenses and other current assets 58.1 59.9
Total current assets 1,427.3 1,059.5
Property and equipment, net 299.0 297.9
Prepaid domain name registry fees, net of current portion 183.6 180.8
Goodwill 2,948.0 2,859.9
Intangible assets, net 1,211.5 1,326.0
Other assets 14.0 14.2
Total assets $ 6,083.4 $ 5,738.3
Liabilities and stockholders' equity
Accounts payable $ 61.6 $ 59.6
Accrued expenses and other current liabilities 414.3 469.6
Deferred revenue 1,393.7 1,264.8
Long-term debt 16.6 16.7
Total current liabilities 1,886.2 1,810.7
Deferred revenue, net of current portion 623.8 596.8
Long-term debt, net of current portion 2,394.2 2,410.8
Payable to related parties pursuant to tax receivable agreements 174.3 153.0
Other long-term liabilities 63.2 75.0
Deferred tax liabilities 117.2 145.5
Stockholders' equity:
Preferred stock, $0.001 par value - 50,000 shares authorized; none issued and outstanding — —
Class A common stock, $0.001 par value - 1,000,000 shares authorized; 168,549 and 132,993
shares issued and outstanding as of December 31, 2018 and 2017, respectively 0.2 0.1
Class B common stock, $0.001 par value - 500,000 shares authorized; 6,254 and 35,006 shares
issued and outstanding as of December 31, 2018 and 2017, respectively — —
Additional paid-in capital 699.8 484.4
Retained earnings 164.8 87.7
Accumulated other comprehensive loss (72.1) (85.7)
Total stockholders' equity attributable to GoDaddy Inc. 792.7 486.5
Non-controlling interests 31.8 60.0
Total stockholders' equity 824.5 546.5
Total liabilities and stockholders' equity $ 6,083.4 $ 5,738.3
See accompanying notes to consolidated financial statements.
89
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GoDaddy Inc.
Consolidated Statements of Operations
Year Ended December 31,

2018 2017 2016
Revenue:
Domains $ 1,220.3 $ 1,057.2 $ 927.8
Hosting and presence 1,017.6 847.9 678.7
Business applications 422.2 326.8 241.4
Total revenue 2,660.1 2,231.9 1,847.9
Costs and operating expenses(1):
Cost of revenue (excluding depreciation and amortization) 893.9 775.5 657.8
Technology and development 434.0 355.8 287.8
Marketing and advertising 291.4 253.2 228.8
Customer care 323.1 292.3 242.1
General and administrative 334.0 282.4 221.2
Depreciation and amortization 234.1 205.8 160.1
Total costs and operating expenses 2,510.5 2,165.0 1,797.8
Operating income 149.6 66.9 50.1
Interest expense (98.4) (83.0) (57.2)
Loss on debt extinguishment — (7.3) —
Tax receivable agreements liability adjustment 14.9 123.2 (12.5)
Other income (expense), net 6.9 7.0 (1.9)
Income (loss) from continuing operations before income taxes 73.0 106.8 (21.5)
Benefit (provision) for income taxes 9.0 18.9 (0.4)
Income (loss) from continuing operations 82.0 125.7 (21.9)
Income from discontinued operations, net of income taxes (includes $33.2 gain on
disposal, net of tax) — 14.1 —
Net income (loss) 82.0 139.8 (21.9)
Less: net income (loss) attributable to non-controlling interests 4.9 3.4 (5.4)
Net income (loss) attributable to GoDaddy Inc. $ 77.1 $ 136.4 $ (16.5)
Net income (loss) attributable to GoDaddy Inc. per share of Class A common stock—
basic:
Continuing operations $ 0.50 $ 1.17 $ (0.21)
Discontinued operations — 0.08 —
Net income (loss) attributable to GoDaddy Inc. per share of Class A common stock—
diluted:
Continuing operations $ 0.45 $ 0.71 $ (0.21)
Discontinued operations — 0.08 —
Weighted-average shares of Class A common stock outstanding:
Basic 155,234 108,779 79,835
Diluted 181,353 177,054 79,835
___________________________
(1)
Costs and operating expenses include equity-based compensation expense as follows:
Technology and development $ 57.8 $ 37.1 $ 23.2
Customer care 6.2 3.6 3.9
Total equity-based compensation expense $ 125.5 $ 76.4 $ 56.8
90
GODADDY, INC. 186
GoDaddy Inc.
Consolidated Statements of Cash Flows
(In millions)

2018 2017 2016
Net income (loss) $ 82.0 $ 139.8 $ (21.9)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Equity-based compensation 125.5 76.4 56.8
Loss on debt extinguishment — 7.3 —
Deferred taxes (26.2) (34.5) (3.8)
Tax receivable agreements liability adjustment (14.9) (123.2) 12.5
Gain on sale of discontinued operations — (33.2) —
Other 14.8 13.3 20.5
Changes in operating assets and liabilities, net of amounts acquired:
Registry deposits 6.2 (10.1) (1.9)
Prepaid domain name registry fees (15.9) (13.5) (22.8)
Accounts payable (3.4) (8.4) 19.6
Accrued expenses and other current liabilities 14.9 32.6 10.0
Deferred revenue 158.0 220.0 160.8
Other operating assets and liabilities (15.3) 3.3 (3.4)
Net cash provided by operating activities 559.8 475.6 386.5
Purchases of short-term investments (24.8) (28.3) (10.5)
Maturities of short-term investments 18.5 22.6 8.4
Business acquisitions, net of cash acquired (147.2) (1,876.9) (118.5)
Purchases of intangible assets (9.3) (52.0) (1.3)
Net proceeds from sale of discontinued operations, including post-closing adjustments (4.3) 447.7 —
Purchases of property and equipment (87.7) (83.2) (61.5)
Net cash used in investing activities (254.8) (1,570.1) (183.4)
Financing activities
Debt issued to finance HEG acquisition — 1,953.1 —
Stock option exercises 67.2 61.1 55.0
Sales of Class A common stock, net of issuance costs — 22.9 —
Issuance of Class A common stock under employee stock purchase plan 21.9 17.4 5.0
Payments made for:
Repurchases of LLC Units and distributions to holders of LLC Units — (285.0) (18.8)
Repayment of HEG acquisition bridge financing — (596.6) —
Repayment of term loans (25.0) (15.3) (11.0)
Financing-related costs — (39.7) —
Other financing obligations (17.1) (10.4) (15.1)
Net cash provided by financing activities 47.0 1,107.5 15.1
Effect of exchange rate changes on cash and cash equivalents (2.3) 3.6 (0.1)
Net increase in cash and cash equivalents 349.7 16.6 218.1
Cash and cash equivalents, beginning of period 582.7 566.1 348.0
Cash and cash equivalents, end of period $ 932.4 $ 582.7 $ 566.1
Supplemental cash flow information:
Cash paid during the period for:
94
GODADDY, INC. 187
GoDaddy Inc.
Consolidated Balance Sheets
December 31,,
2019 2018
Assets
Current assets:
Cash and cash equivalents $ 1,062.8 $ 932.4
Short-term investments 23.6 18.9
Accounts and other receivables 30.2 26.4
Registry deposits 27.2 28.3
Prepaid domain name registry fees 382.6 363.2
Prepaid expenses and other current assets 48.9 58.1
Total current assets 1,575.3 1,427.3
Property and equipment, net 258.6 299.0
Operating lease assets 196.6 —
Prepaid domain name registry fees, net of current portion 179.3 183.6
Goodwill 2,976.5 2,948.0
Intangible assets, net 1,097.7 1,211.5
Other assets 17.2 14.0
Total assets $ 6,301.2
, $ 6,083.4
,
Liabilities and stockholders' equity
Accounts payable $ 72.3 $ 61.6
Accrued expenses and other current liabilities 366.0 414.3
Deferred revenue 1,544.4 1,393.7
Long-term debt 18.4 16.6
Total current liabilities 2,001.1 1,886.2
Deferred revenue, net of current portion 654.4 623.8
Long-term debt, net of current portion 2,376.8 2,394.2
Operating lease liabilities, net of current portion 192.9 —
Payable to related parties pursuant to tax receivable agreements 175.3 174.3
Other long-term liabilities 17.7 63.2
Deferred tax liabilities 100.9 117.2
Stockholders' equity:
Preferred stock, $0.001 par value - 50,000 shares authorized; none issued and outstanding — —
Class A common stock, $0.001 par value - 1,000,000 shares authorized; 172,867 and 168,549
shares issued and outstanding as of December 31, 2019 and 2018, respectively 0.2 0.2
Class B common stock, $0.001 par value - 500,000 shares authorized; 1,490 and 6,254 shares
issued and outstanding as of December 31, 2019 and 2018, respectively — —
Additional paid-in capital 1,003.5 699.8
Retained earnings (accumulated deficit) (153.5) 164.8
Accumulated other comprehensive loss ((78.2)) ((72.1))
Total stockholders' equity attributable to GoDaddy Inc. 772.0 792.7
Non-controlling interests 10.1 31.8
Total stockholders' equity 782.1 824.5
Total liabilities and stockholders' equity $ 6,301.2
, $ 6,083.4
,
83
GODADDY, INC. 188
GoDaddy Inc.
Consolidated Statements of Operations
Year Ended December 31,,

2019 2018 2017
Revenue:
Domains $ 1,351.6 $ 1,220.3 $ 1,057.2
Hosting and presence 1,126.5 1,017.6 847.9
Business applications 510.0 422.2 326.8
Total revenue 2,988.1 2,660.1 2,231.9
Costs and operating expenses(1):
Cost of revenue (excluding depreciation and amortization) 1,026.8 893.9 775.5
Customer care 348.7 323.1 292.3
Total costs and operating expenses 2,785.5
, 2,510.5
, 2,165.0
,
Operating income 202.6 149.6 66.9
Interest expense (92.1) (98.4) (83.0)
Loss on debt extinguishment (14.8) — (7.3)
Tax receivable agreements liability adjustment 8.7 14.9 123.2
Other income (expense), net 22.0 6.9 7.0
Income from continuing operations before income taxes 126.4 73.0 106.8
Benefit for income taxes 12.0 9.0 18.9
Income from continuing operations 138.4 82.0 125.7
Income from discontinued operations, net of income taxes — — 14.1
Net income 138.4 82.0 139.8
Less: net income attributable to non-controlling interests 1.4 4.9 3.4
Net income attributable to GoDaddy Inc. $ 137.0 $ 77.1 $ 136.4
Net income attributable to GoDaddy Inc. per share of Class A common stock—basic:
Continuing operations $ 0.79 $ 0.50 $ 1.17
Discontinued operations — — 0.08
Net income attributable to GoDaddy Inc. per share of Class A common stock—
diluted:
Continuing operations $ 0.76 $ 0.45 $ 0.71
Discontinued operations — — 0.08
Weighted-average shares of Class A common stock outstanding:
Basic 173,431
, 155,234
, 108,779
,
Diluted 181,721
, 181,353
, 177,054
,
___________________________
(1)
Costs and operating expenses include equity-based compensation expense as follows:
Cost of revenue $ 0.4 $ — $ —
Customer care 9.3 6.2 3.6
Total equity-based compensation expense $ 147.0 $ 125.5 $ 76.4
84
GODADDY, INC. 189
GoDaddy Inc.
Consolidated Statements of Cash Flows
(In millions)

2019 2018 2017
Net income $ 138.4 $ 82.0 $ 139.8
Adjustments to reconcile net income to net cash provided by operating activities:
Equity-based compensation 147.0 125.5 76.4
Loss on debt extinguishment 14.8 — 7.3
Tax receivable agreements liability adjustment (8.7) (14.9) (123.2)
Gain on sale of discontinued operations — — (33.2)
Other 32.7 (11.4) (21.2)
Changes in operating assets and liabilities, net of amounts acquired:
Registry deposits 1.1 6.2 (10.1)
Prepaid domain name registry fees (15.1) (15.9) (13.5)
Accounts payable 13.6 (3.4) (8.4)
Accrued expenses and other current liabilities 40.4 14.9 32.6
Deferred revenue 179.5 158.0 220.0
Other operating assets and liabilities ((30.0)) ((15.3)) 3.3
Net cash provided by operating activities 723.4 559.8 475.6
Purchases of short-term investments (64.1) (24.8) (28.3)
Maturities of short-term investments 59.9 18.5 22.6
Business acquisitions, net of cash acquired (40.3) (147.2) (1,876.9)
Purchases of intangible assets (4.7) (9.3) (52.0)
Net proceeds from sale of discontinued operations, including post-closing adjustments — (4.3) 447.7
Purchases of property and equipment (87.6) (87.7) (83.2)
Other investing activities, net 1.5 — —
Net cash used in investing activities (135.3) (254.8) (1,570.1)
Financing activities
Issuance of Senior Notes 600.0 — —
Stock option exercises 70.7 67.2 61.1
Issuances of Class A common stock under employee stock purchase plan 28.5 21.9 17.4
Debt issued to finance HEG acquisition — — 1,953.1
Sales of Class A common stock, net of issuance costs — — 22.9
Payments made for:
Repayment of term loans (625.0) (25.0) (15.3)
Repurchases of Class A common stock (458.6) — —
Contingent consideration for business acquisitions (54.8) (10.4) (1.2)
Financing-related costs (13.2) — (39.7)
Repurchases of LLC Units and distributions to holders of LLC Units — — (285.0)
Repayment of HEG acquisition bridge financing — — (596.6)
Other financing obligations ((4.5)) ((6.7)) ((9.2))
Net cash provided by (used in) financing activities ((456.9)) 47.0 1,107.5
Effect of exchange rate changes on cash and cash equivalents (0.8)
( ) ((2.3)) 3.6
Net increase in cash and cash equivalents 130.4 349.7 16.6
Cash and cash equivalents, beginning of period 932.4 582.7 566.1
Cash and cash equivalents, end of period $ 1,062.8
, $ 932.4 $ 582.7
89
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Running head: GODADDY, INC.

Ateneo de Manila Graduate School of Business

A Strategic Management Paper on GoDaddy, Inc.

Professor Leveric T. Ng, DBA

In partial fulfillment of course requirements for TSSTRAMA

Casey Clayton Hare, PHR

AGSB Clark – MBA Regis Program

October 21, 2021

List of Figures ............................................................................................................... 6

4.2.1.6 Growth Rate and Stage in Growth Cycle ............................................. 40

5.1.3.1 Horizontal Analysis.............................................................................. 82

7.1.3 Financial Objective ................................................................................... 126

Table 44 - Market Penetration #6 and Product Development #2 ........................................... 147

strategies for GoDaddy, Inc., a multi-national Internet-based business headquartered in

is currently the number two provider of Software-as-a-Service E-Commerce solutions

mission statements, analyzing the external environments in which GoDaddy operates

of GoDaddy. This paper then formulates strategy recommendations using established

provide contingencies in case of unforeseen or disastrous events.

to reclaim market share from its competitors.

guarantee its continued performance and profitability as a company.

Figure 1 - GoDaddy Logo

1.1 Company Background

“GoDaddy” and continued to build that brand since (Parsons, 2004).

While originally envisioned as a website creation/software company, GoDaddy took

Figure 2 - Old GoDaddy Logo (until 2020)

and business support for online businesses.

1.2 Products and Services

(TLD) such as .com, .org, .net, or .ph.

Figure 3 - Domain name in relation to URL Internet address

domain by linking it to a website address, either hosted by GoDaddy or elsewhere on the

immediately, it can be bought by a different person or organization (often known as “site

as the domain “aftermarket” (GoDaddy, Inc., 2021).

following listed in the table below:

Table 1 - List of GoDaddy Domain Products and Services

Product or Service Description

Purchase Domain Customers can purchase a specific domain name on up to 240

Renew Domain Customers can pay to continue their domain registration

Product or Service Description

Protect Domain Optional premium services to prevent a third party from

Premium DNS Access to GoDaddy’s DNS network to increase uptime and

1.2.2 Software as a Service (SaaS)

The second half of GoDaddy’s business centers around providing Software as a

1.2.2.1 Hosting and Presence

Figure 4 - GoDaddy Marketing for Online Store Builder

power and options.

(collectively known internally as Websites + Marketing), as well as a Managed WordPress

technical support, and proprietary plugins.

1.2.2.2 Business Applications

products collected in a category known as Business Applications. These services, while

GoDaddy’s revenue in 2020.

1.3 Current revenues

1.4 Markets Served

(GoDaddy, Inc., 2021).

2. Research Design and Methodology

competitors and the overall performance of the e-commerce industry.

2.1 Internal Data

or other inside information. However, this researcher, as an employee of Automattic, Inc.,

releases, or other operational announcements published by the above companies.

2.2 External Data

(shipping, fulfillment, payments) published by various firms; academic dissertations

data privacy laws, and cross-border shipping regulations.

(Global) Edition of Strategic Management: A Competitive Advantage Approach, Concepts

and Cases by David and David.

2.3 Field Interviews