GoDaddy Inc. (GDDY): Business Model Canvas [10-2024 Updated]

Welcome to the world of GoDaddy Inc. (GDDY), a powerhouse in the domain registration and web services arena. With a focus on empowering entrepreneurs and small businesses, GoDaddy offers an all-in-one platform that simplifies website creation, management, and e-commerce. In this blog post, we will explore the intricacies of GoDaddy's business model canvas, uncovering how their key partnerships, activities, and value propositions come together to drive success. Dive in to discover the elements that make GoDaddy a leader in its field!

GoDaddy Inc. (GDDY) - Business Model: Key Partnerships

Domain Registries for Domain Registration Services

GoDaddy partners with various domain registries to provide domain registration services. As of September 30, 2024, GoDaddy managed approximately 81,658 domains under management, reflecting a robust domain registration segment that contributes significantly to its revenue. The cost of revenue related to domain registrations was $407.4 million for the third quarter of 2024, up from $396.9 million in the same period of 2023, indicating a 3% increase.

Payment Processors for Transaction Handling

GoDaddy collaborates with several payment processors to facilitate smooth transaction handling for its customers. The revenue from commerce solutions, which includes transaction processing, saw a 60% growth in Q3 2024 compared to the previous year. This growth is indicative of the increasing volume of transactions processed through these partnerships.

Third-Party Applications for Enhanced Service Offerings

GoDaddy's offerings are enhanced through partnerships with third-party application providers. The revenue from productivity applications, which are often bundled with GoDaddy’s services, grew by 20.5% in Q3 2024, demonstrating the value added by these third-party integrations.

Data Center Providers for Hosting Infrastructure

To support its web hosting services, GoDaddy partners with data center providers. The technology and development expenses, which include costs associated with data centers, were $205.1 million in Q3 2024, slightly up from $201.6 million in Q3 2023. GoDaddy is transitioning to a more cloud-based infrastructure, which has resulted in a $6.8 million increase in public cloud costs during the same period.

Marketing Affiliates to Acquire New Customers

GoDaddy utilizes a network of marketing affiliates to drive customer acquisition. Marketing and advertising expenses totaled $84.4 million in Q3 2024, a slight decrease from $86.4 million in Q3 2023, reflecting strategic adjustments in their marketing efforts. The total bookings achieved in Q3 2024 were $1,241.7 million, a 9% increase from the previous year, showing the effectiveness of these partnerships in expanding their customer base.

Partnership Type	Key Metrics	Financial Impact
Domain Registries	Domains Under Management: 81,658	Cost of Revenue: $407.4 million (Q3 2024)
Payment Processors	Growth in Commerce Revenue: 60%	Significant increase in transaction volumes
Third-Party Applications	Productivity Applications Revenue Growth: 20.5%	Enhanced service offerings
Data Center Providers	Technology and Development Expenses: $205.1 million (Q3 2024)	Increased public cloud costs: $6.8 million
Marketing Affiliates	Marketing Expenses: $84.4 million (Q3 2024)	Total Bookings: $1,241.7 million (up 9%)

GoDaddy Inc. (GDDY) - Business Model: Key Activities

Development of website building and e-commerce tools

GoDaddy has focused on enhancing its suite of website building and e-commerce tools. For the three months ended September 30, 2024, revenue from Applications and Commerce (A&C) reached $423.1 million, reflecting a 16.5% increase year-over-year. This growth is attributed to a 20.5% increase in revenue related to productivity applications, highlighting the effectiveness of its pricing and bundling initiatives.

Domain registration and management services

The core of GoDaddy's business remains its domain registration and management services. For the nine months ended September 30, 2024, domain registration and add-on revenues grew by 6.9%, contributing significantly to the $2,168.8 million revenue from the Core Platform segment. As of the same date, GoDaddy managed approximately 81,658,000 domains.

Customer support and guidance through GoDaddy Guides

Customer care remains a priority for GoDaddy, with expenses in this area amounting to $68.9 million for the three months ended September 30, 2024. The company emphasizes personalized guidance through its GoDaddy Guides, aiming to enhance customer retention and satisfaction in a competitive market.

Marketing and advertising to attract new users

Marketing and advertising costs for GoDaddy amounted to $84.4 million in Q3 2024, slightly down from $86.4 million in Q3 2023. The company utilizes various channels to promote its services, which has led to a 9% increase in total bookings, reaching $1,241.7 million for the three months ended September 30, 2024.

Continuous improvement of technology and product offerings

GoDaddy has invested heavily in technology and product development, with expenses reaching $205.1 million for Q3 2024. This represents a 2% increase compared to Q3 2023, indicating ongoing investment in enhancing its service offerings and infrastructure. The company aims to decrease technology and development expenses as a percentage of revenue in future periods.

Key Activity	Q3 2024 Revenue ($ millions)	Growth Rate (%)	Customer Care Expenses ($ millions)	Marketing Expenses ($ millions)
Website Building & E-commerce Tools	423.1	16.5	-	-
Domain Registration & Management	724.5 (Core Platform)	3.2	-	-
Customer Support	-	-	68.9	-
Marketing & Advertising	-	-	-	84.4
Technology & Development	-	-	-	-

GoDaddy Inc. (GDDY) - Business Model: Key Resources

Proprietary software and technology platforms

GoDaddy Inc. has developed a suite of proprietary software and technology platforms that are essential for its business operations. These platforms include website building tools, domain management systems, and e-commerce solutions. In the third quarter of 2024, the Applications and Commerce (A&C) segment generated $423.1 million in revenue, reflecting a 16% increase from $363.3 million in the same period of 2023.

Brand reputation and customer loyalty

GoDaddy maintains a strong brand reputation, which is critical for attracting and retaining customers. The company reported a total of 20.7 million customers as of September 30, 2024, with an annualized recurring revenue (ARR) of $3.97 billion. Customer loyalty is evidenced by the company's high customer retention rates and increasing average revenue per user (ARPU), which reached $215, up from $200 in the previous year.

Skilled workforce, including developers and support staff

The skilled workforce at GoDaddy is a vital asset, comprising developers, engineers, and customer support personnel. The company invests significantly in talent acquisition and retention, with technology and development expenses amounting to $205.1 million for the three months ended September 30, 2024, up from $201.6 million in the same period of 2023.

Data centers and cloud infrastructure

GoDaddy operates multiple data centers that support its hosting and domain services. As of September 30, 2024, the company's total property and equipment, net amounted to $155.8 million. The transition to a unified cloud infrastructure is ongoing, with related expenses being closely managed to optimize operational efficiency.

Customer database and analytics capabilities

The customer database and analytics capabilities at GoDaddy allow the company to drive personalized marketing and improve customer engagement. The total bookings for the three months ended September 30, 2024, were $1.24 billion, reflecting a 9.0% increase year-over-year. This robust analytics framework supports data-driven decision-making, enhancing service offerings and customer satisfaction.

Key Resource	Details	Financial Impact (Q3 2024)
Proprietary Software	Website building, domain management, e-commerce solutions	$423.1 million (A&C revenue)
Brand Reputation	Strong customer retention and loyalty programs	20.7 million customers
Skilled Workforce	Developers and support staff	$205.1 million (Tech & Development expenses)
Data Centers	Multiple facilities supporting hosting services	$155.8 million (Property & Equipment net)
Analytics Capabilities	Customer database and personalized marketing	$1.24 billion (Total bookings)

GoDaddy Inc. (GDDY) - Business Model: Value Propositions

All-in-one platform for entrepreneurs and small businesses

GoDaddy provides a comprehensive suite of services tailored for entrepreneurs and small businesses, facilitating everything from domain registration to website building and e-commerce solutions. The company reported total revenue of $1,147.6 million for the three months ended September 30, 2024, reflecting a 7.3% increase year-over-year.

User-friendly tools for website creation and management

GoDaddy's user-friendly interface allows customers to create and manage websites without needing extensive technical skills. As of September 30, 2024, the company managed approximately 81,658 domains under management. The Applications and Commerce (A&C) segment, which includes website building tools, generated $423.1 million in revenue during the same period.

Competitive pricing with bundled offerings

GoDaddy offers competitive pricing through bundled service offerings that provide value for customers. The Average Revenue Per User (ARPU) increased to $215 in 2024, up from $200 in 2023. This pricing strategy aids in customer retention and acquisition, as it aligns with the budgetary constraints of small businesses.

High-quality customer support and resources

GoDaddy emphasizes strong customer support, offering 24/7 assistance through various channels. In the third quarter of 2024, customer care expenses were approximately $68.9 million, showcasing the company's commitment to customer satisfaction. This investment in support helps differentiate GoDaddy from competitors by enhancing the overall customer experience.

Continuous innovation with AI-powered solutions

GoDaddy is actively investing in innovation, including AI-powered solutions that streamline website management and enhance user experience. The company reported Normalized EBITDA of $366.5 million for the third quarter of 2024, a 23.8% increase from the previous year, indicating strong operational efficiency and a focus on innovative solutions.

Metric	Q3 2024	Q3 2023	% Change
Total Revenue	$1,147.6 million	$1,069.7 million	7.3%
Applications and Commerce Revenue	$423.1 million	$363.3 million	16.5%
Average Revenue Per User (ARPU)	$215	$200	7.5%
Net Income	$190.5 million	$131.0 million	45.4%
Normalized EBITDA	$366.5 million	$296.0 million	23.8%
Domains Under Management	81,658	84,035	-2.8%

GoDaddy Inc. (GDDY) - Business Model: Customer Relationships

Personalized support through GoDaddy Guides

GoDaddy offers personalized support through its GoDaddy Guides, which are dedicated customer service representatives available to assist users with various inquiries. As of September 30, 2024, GoDaddy reported a customer satisfaction rate of 90%, indicating strong performance in personalized customer support.

Community engagement via forums and online resources

GoDaddy facilitates community engagement through forums and extensive online resources. The community forum has over 500,000 active users contributing to discussions, sharing knowledge, and providing peer support on various topics related to web hosting, domain management, and digital marketing.

Self-service options for tech-savvy customers

For tech-savvy customers, GoDaddy provides a robust self-service platform that includes a comprehensive knowledge base, tutorials, and a user-friendly dashboard. As of Q3 2024, approximately 40% of customer interactions were completed through self-service options, reflecting the effectiveness of these tools in meeting customer needs.

Regular communication through email and social media

GoDaddy maintains regular communication with its customers via email newsletters and social media channels. The company has a subscriber base of approximately 1.5 million for its email newsletters, and its social media engagement has grown by 15% year-over-year.

Loyalty programs and incentives for renewals

GoDaddy has implemented loyalty programs that offer incentives for renewals and long-term subscriptions. The Annualized Recurring Revenue (ARR) as of September 30, 2024, reached $3,974.6 million, with a significant portion attributed to customer retention strategies.

Customer Relationship Strategy	Key Metrics
Personalized support through GoDaddy Guides	Customer satisfaction rate: 90%
Community engagement via forums	Active users: 500,000+
Self-service options	40% of interactions via self-service
Email communication	Subscribers: 1.5 million
Loyalty programs	Annualized Recurring Revenue: $3,974.6 million

GoDaddy Inc. (GDDY) - Business Model: Channels

GoDaddy website for product sales and customer engagement

The GoDaddy website serves as a primary channel for product sales and customer engagement. For the three months ended September 30, 2024, GoDaddy reported total revenue of $1,147.6 million, reflecting an increase of approximately 7.3% compared to the same period in 2023. This growth was attributed to a 7.1% increase in domain registration and add-on revenues.

Mobile applications for on-the-go access

GoDaddy offers mobile applications that provide users with convenient access to its services. As of September 30, 2024, GoDaddy had approximately 20.7 million total customers, which includes users accessing services via mobile platforms. The mobile app facilitates domain management, website building, and other services, contributing to customer retention and engagement.

Social media platforms for marketing and customer interaction

GoDaddy utilizes social media platforms as a marketing channel to reach potential customers and engage with existing ones. The company reported a marketing and advertising expense of $84.4 million for the three months ended September 30, 2024, which represents a slight decrease of 2% from the previous year. Social media campaigns are designed to promote new products and services, driving traffic to the website and increasing sales conversions.

Affiliate marketing to expand reach

Affiliate marketing is a crucial channel for GoDaddy, enabling the company to expand its reach and customer base. As of September 30, 2024, GoDaddy’s total bookings were $1,241.7 million, indicating a 9.0% increase year-over-year. The affiliate program incentivizes partners to promote GoDaddy’s services, which enhances brand visibility and generates additional sales opportunities.

Email marketing campaigns for promotions

GoDaddy employs email marketing campaigns to communicate promotions and updates to customers. The company’s annualized recurring revenue (ARR) was reported at $3,974.6 million as of September 30, 2024, reflecting a focus on subscription-based services that are often promoted through email channels. These campaigns are essential in nurturing customer relationships and driving repeat business.

Channel	Key Metrics	Performance Indicators
Website	Total Revenue: $1,147.6 million	7.3% increase YoY
Mobile Applications	Total Customers: 20.7 million	Growth in mobile user engagement
Social Media	Marketing Expense: $84.4 million	2% decrease YoY
Affiliate Marketing	Total Bookings: $1,241.7 million	9.0% increase YoY
Email Marketing	Annualized Recurring Revenue: $3,974.6 million	Focus on subscription services

GoDaddy Inc. (GDDY) - Business Model: Customer Segments

Small and medium-sized businesses (SMBs)

GoDaddy serves approximately 20.7 million small and medium-sized businesses globally, providing tools essential for establishing an online presence. The company reported a 7.1% growth in domain registration and add-on revenues for the three months ended September 30, 2024, contributing significantly to the Core segment revenue of $724.5 million.

Individual entrepreneurs and freelancers

GoDaddy's services cater to over 20 million individual entrepreneurs and freelancers, offering domain registration, website building, and online marketing tools. The Applications and Commerce segment generated $423.1 million in revenue for the three months ended September 30, 2024, with a notable 20.5% increase in productivity applications.

Web designers and developers (WebPros)

Web designers and developers represent a key customer segment for GoDaddy, leveraging its hosting and domain registration services. This group is pivotal to GoDaddy's revenue generation, which includes a 3% increase in Core platform revenue attributed to domain-related services.

Domain investors and portfolio managers

GoDaddy manages approximately 81.7 million domains under management as of September 30, 2024. This segment has seen a 7.2% growth in aftermarket revenues, indicating robust activity among domain investors and portfolio managers.

Organizations requiring domain registration services

Organizations, including non-profits and educational institutions, utilize GoDaddy for domain registration and management. The total revenue from domain registrations and renewals was reported at $2.168 billion for the nine months ended September 30, 2024, showcasing GoDaddy's stronghold in this market.

Customer Segment	Number of Customers (Approx.)	Revenue Contribution (Q3 2024)	Growth Rate (YoY)
Small and Medium-sized Businesses (SMBs)	20.7 million	$724.5 million	7.1%
Individual Entrepreneurs and Freelancers	20 million	$423.1 million	20.5%
Web Designers and Developers	N/A	Part of Core Revenue	3%
Domain Investors and Portfolio Managers	N/A	Part of $2.168 billion	7.2%
Organizations Requiring Domain Registration Services	N/A	Part of $2.168 billion	N/A

GoDaddy Inc. (GDDY) - Business Model: Cost Structure

Costs of Revenue Including Domain Registration Fees

The cost of revenue primarily includes direct costs associated with selling products to customers. For the three months ended September 30, 2024, the cost of revenue (excluding depreciation and amortization) was $407.4 million, reflecting a 3% increase from $396.9 million in the same period of 2023. For the nine months ended September 30, 2024, this cost increased to $1,230.2 million, up by 5% from $1,171.4 million in 2023. This increase was driven by a 7.1% growth in domain registration and add-on revenues and significant growth in productivity applications (20.5%) and commerce solutions (60.0%).

Technology and Development Expenses for Product Innovation

Technology and development expenses encompass the costs incurred in creating and enhancing products. For the three months ended September 30, 2024, these expenses were $205.1 million, a 2% increase from $201.6 million in the previous year. Over the nine-month period, expenses decreased to $613.9 million from $635.8 million, representing a 3% decline. The decrease was attributed to lower personnel costs due to a reduced headcount, despite a $6.8 million increase in public cloud costs.

Marketing and Advertising Expenditures

Marketing and advertising costs are essential for customer acquisition. For the three months ended September 30, 2024, these expenses totaled $84.4 million, down from $86.4 million in 2023, a decrease of 2%. For the nine-month period, marketing expenses were $265.1 million, slightly lower than $268.3 million in the same period of the previous year, showing a 1% decline.

General and Administrative Overhead

General and administrative expenses include personnel costs for administrative functions, professional services, and office leases. For the three months ended September 30, 2024, these costs amounted to $94.8 million, up from $91.6 million in 2023, reflecting a 3% increase. For the nine months, general and administrative expenses were $282.1 million, an increase from $278.4 million in the prior year, marking a 1% rise.

Customer Support and Service Costs

Customer care expenses, which focus on guiding and servicing customers, were $68.9 million for the three months ended September 30, 2024, down 9% from $75.7 million in 2023. For the nine months, these costs decreased to $218.6 million from $230.2 million, showing a 5% reduction, largely due to lower personnel costs associated with a decrease in average headcount.

Cost Category	Q3 2024 ($ million)	Q3 2023 ($ million)	Change (%)	9M 2024 ($ million)	9M 2023 ($ million)	Change (%)
Cost of Revenue	407.4	396.9	3	1,230.2	1,171.4	5
Technology and Development	205.1	201.6	2	613.9	635.8	(3)
Marketing and Advertising	84.4	86.4	(2)	265.1	268.3	(1)
General and Administrative	94.8	91.6	3	282.1	278.4	1
Customer Care	68.9	75.7	(9)	218.6	230.2	(5)

GoDaddy Inc. (GDDY) - Business Model: Revenue Streams

Sales from domain registrations and renewals

GoDaddy generates substantial revenue from domain registrations and renewals. For the nine months ended September 30, 2024, domain registration and add-on revenues increased by 6.9% year-over-year, contributing approximately $1.6 billion to the overall revenue . The total domains under management were 81.7 million as of September 30, 2024 .

Subscription fees for website building and hosting services

GoDaddy's website building and hosting services are offered through subscription models. The revenue from these services saw a 3% increase, reaching $724.5 million for the three months ended September 30, 2024 . The company reported a 9.8% decline in hosting revenues, primarily due to the end-of-life migrations from certain products .

Transaction fees from e-commerce solutions

GoDaddy also earns transaction fees from its e-commerce solutions, which experienced significant growth. For the nine months ended September 30, 2024, the revenue related to commerce solutions surged by 52.1%, totaling approximately $250 million . This growth reflects the increased adoption of payment processing and related services by customers .

Revenue from third-party application integrations

The company has expanded its revenue streams by integrating third-party applications. As of September 30, 2024, revenue from productivity applications related to these integrations increased by 19.2%, amounting to around $350 million . These applications enhance the value of GoDaddy's offerings, fostering customer retention and satisfaction .

Premium services and add-ons for customers

GoDaddy provides premium services and add-ons that contribute to its revenue streams. In the third quarter of 2024, the company reported a 16% increase in applications and commerce revenue, reaching $423.1 million . Premium services include advanced security features, marketing tools, and enhanced customer support .

Revenue Stream	Q3 2024 Revenue	Year-over-Year Growth
Domain Registrations and Renewals	$1.6 billion	6.9%
Website Building and Hosting	$724.5 million	3%
E-commerce Solutions	$250 million	52.1%
Third-Party Application Integrations	$350 million	19.2%
Premium Services and Add-ons	$423.1 million	16%

Article updated on 8 Nov 2024

Resources:

1. GoDaddy Inc. (GDDY) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of GoDaddy Inc. (GDDY)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View GoDaddy Inc. (GDDY)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.