Shutterfly Company Analysis

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Shutterfly Company Analysis

Key Takeaways

  • Shutterfly had an annual revenue of $1.9 billion in 2021.
  • The company has a mission to, "build an unrivaled service that enables deeper, more personal relationships between our customers and those who matter most in their lives".
  • Recent strategic initiatives include leveraging the public cloud and hosted services, as well as launching an NFT strategy.

Introduction

In order to support an understanding of company Shutterfly and their digital transformation strategy, below we've provided a company analysis which includes an overview of their products and financials, strategic initiatives with a focus on key highlights of their digital strategy, any corporate challenges faced by the company recently, their marketing tech stack, a list of key competitors, and other related relevant company information.

Overview

  • Shutterfly consists of three brand divisions; Consumer, Lifetouch and Shutterfly Business Solutions.
  • Their primary product offering is the design and manufacturing of personalized and custom products for both individuals and small businesses.
  • The company' annual revenue in 2021 was approximately $1.9 billion.
  • Since founding, the company has raised a total of $50 million in funding.
  • Funding is from four investors over four rounds. However, the company's latest investor funding was in 2005.
  • The company has a mission to, "build an unrivaled service that enables deeper, more personal relationships between our customers and those who matter most in their lives".
  • The companies values include investing in great talent, acting as owners, debating the most important decisions before committing ot them, doing the right thing for customers, investing in the long-term while delivering results, inspiring customers "through creativity and beautiful design", and passionate innovation on the behalf of customers.

Strategic Initiatives

  • Recent and future strategic initiatives include leveraging the public cloud and hosted services, as well as launching an NFT strategy.
  • Of their perspective on cloud and hosted services, CTO Moudy Elbayadi made the statement, "We have a mission on “How do we really delight customers?” in all that we do. And from a technology perspective, when we think about what does delight mean, it really meant that we needed to spend more time focusing on improving the customer experience and spending less time on infrastructure and the back office... Ultimately, a big part of getting that focus back was really centered around how do leverage the power of the public cloud and the power of hosted services."
  • To kickoff the company's NFT strategy, Shutterfly partnered with designer Iris Apfel to create a holiday NFT CryptoCard Collection.
  • Shutterfly president Jim Hilt said of the NFT project, “We believe that creative NFTs can provide an innovative way to celebrate cherished memories, and this is just the beginning of how we can help people create things that reflect who they uniquely are.”
  • While the CEO has not recently made statements on the company's digital strategy, she did recently speak of their overall advantage, saying the company has an advantage to be able to keep business running, stating, "We have a lot of foresight into manufacturing, supply chain, and seasonal staffing shortages.

Overall Digital Strategy

  • Shutterfly's overall tech stack consists of 68 products, which include HTML5, Google Analytics, and jQuery.
  • Their website uses ten products, including Viewport Meta, IPhone / Mobile Compatible, and Apple Mobile Web Clips Icon.
  • Their marketing tech stack is AI based, the result of a three year development process in which head of Shutterfly marketing technology, Mike Berry, scaled communication relevancy using a combination of Salesforce migration and predictive data models.
  • The company's ecommerce platform was recently migrated to MongoDB Atlas on AWS.

Challenges & Competition

Data Leak
  • In early 2022, Shutterfly publicly disclosed that they'd experienced a data breach.
  • The breach, a Conti ransomware attack, had primarily exposed employee information.
  • However, while primarily putting employee information at risk, the breach also included merchant account information, corporate login credentials, internal spreadsheets, and limited financial information from customers such as the last four digits of credit cards.
  • The breach, which occurred in December 2021, has been addressed through a combination of credit monitoring for those whose data was leaked, as well as "working with outside cybersecurity experts to continue investigating the attack", to prevent similar issues in the future.
Supply Chain Challenges
  • While current supply chain challenges potentially impact Shutterfly, they have more experience handling shortages and strategies to prevent price increases.
  • The company's CEO states, "There certainly have been challenges, but with our ability to get the materials procured, we have everything in stock. We’ve also been able to find significant offsets on the cost side, so we don’t have to pass that along to the consumer.
  • In early 2021, the company trimmed staff at Lifetouch, the school photography arm of the business, to reduce cost impact of the pandemic and preserve resources.
Key Competitors
  • Moo, "one of Shutterfly’s top competitors in the customized business products sector", is a UK based online platform for creating custom products.
  • Their website can be found here.
  • Vistaprint is the "world’s leading online platform for custom printing services", with over $1.4 billion in annual revenue.
  • Their website can be found here.
  • Smaller competitor Mixbook generates only $5 million in annual revenue, but offers similar custom product printing.
  • Their website can be found here.
  • UK based PhotoBox focuses primarily on online photo printing services for consumers, including photo books, cards, calendars, and personalized gifts.
  • Their website can be found here.

Other Relevant Information

  • Shutterfly's IPO was in 2006, during which the company was valued at $350 million, and $15 per share.
  • After being acquired by Apollo Global Management, Shutterfly is now privately held, but there have been recent rumors that Shutterfly will return to the stock exchange in coming months.
  • Since founding, Shutterfly has acquired fourteen organizations, with their most recent acquisition of Lifetouch in 2018 for $825 million.

Research Strategy

For this research on Shutterfly, we leveraged the most reputable sources of information that were available in the public domain, including business directories, reputable media sources such as Forbes and Business Insider, as well as direct company information via websites and press releases. We determined major competitors as those companies with similar product and service offerings, revenues and company size.

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