I think the majority of godaddy domain purchasers are first time buyers or small businesses that do not know of other domain companies (especially considering godaddy's large advertisement investment).
I think many big time operators / hosting providers use them too because of the price, their inbound transfers are actually sold at a loss (when you take into account all the fees they have to pay).
Most other registrars that do larger volumes will sell you at about $1 over their cost.
