LivingSocial endured a tumultuous year-and-a-half from mid-2012 through 2013 as executives attempted to make the District-based company profitable. Hundreds of jobs were cut, lines of business were closed, overseas operations were sold. But even as quarterly losses narrowed, profitability remained elusive.
The focus is now shifting to revenue growth. With $250 million in fresh capital from its sale of South Korea-based Ticket Monster, LivingSocial plans to invest heavily in adding new subscribers and expanding its recently launched Web site of coupons and discounts.
The company has appointed Doug Miller, its senior vice president of new business initiatives, to oversee the revenue expansion. In his new role as chief revenue officer, Miller will oversee the company’s efforts to, simply put, collect more money.
What are the responsibilities of the chief revenue officer?
“LivingSocial 2014, we’re really moving ahead with focus here. Creating a chief revenue officer job is part of that focus on growth, that focus on revenue, that focus on creating demand for our local merchants, hotels, national brands and so on. The idea of it is to create a single end-to-end revenue function . . . to think about how we grow revenue overall, whether that is with local merchants, the travel business or national brands.”
Will you still have your old duties as senior vice president of new business initiatives?
“Innovation is constant and it’s always been a part of everyone’s job at LivingSocial. Right now we’re absorbing the notion of innovation into our product organization and we’ll continue to innovate in that way as we see opportunities. We’re not going to continue on with a new business initiatives group right now. We’re simply organizing differently. That’s part of the focus we want to achieve in 2014.”
Is there greater focus then on maximizing revenue from current lines of business rather than finding new revenue streams altogether? Why?
“I would say that’s right. We have businesses that we’re in right now that are big spaces and we believe we can grow our share. There are other segments of local media, there are other segments of online and local commerce that we’re not in that are interesting and we will always continue to see what those opportunities look like. But there is a lot of focus on our core model this year and executing very well against that core.”
Why is this position being created now? What does that say about where the company stands?
“Today what we do has flashes of brilliance, but we can do it better. Our organization will get better and the business will get more focused. A lot that we do for partners today and brands is really very powerful. The business is very different than 99 percent of the advertising or media businesses that are out there in that we don’t ask our business partners for anything up front. We work together to develop a promotion and then we both go out and talk to the LivingSocial audience about that.”
Is profitability important at this point for LivingSocial? Is it within reach?
“A lot of our [focus] last year was about profitability and we spent a lot of time focusing on that idea. This year we’re going to really focus on growth. Revenue growth is important for LivingSocial right now. This year [we could have] put together one of two plans: one would have guaranteed all of our investors, employees and every stakeholder in the company profitability in 2014. The other would absolutely get us to grow in 2014. But we couldn’t do both. 2014 we are very focused on revenue growth.”
Are there revenue opportunities that LivingSocial isn’t taking advantage of at the moment? What are they?
“In addition to bringing customers back to our store and engaging them with LivingSocial, we’re continuing to invest in merchant propositions and how we work with merchants. The last few years we went in with [daily deals] and based on the needs of the merchants we didn’t have a tremendous range of adaptability. Quietly there was innovation going on [in 2013]. We were going in with a conversation and set of solutions that were more tailored.”
Among those innovations was the creation of a coupon site that launched last September. How is that going?
“We have many thousands more merchants that are live everyday with a great offer for our customer as a result of marketplace. We’re getting smarter and smarter in partnership with them on flash promotions, in addition to more persistent everyday offers. Some segments of our merchant base want to be live on a more persistent basis. [Merchants] want to make sure they’re part of the new marketplace as those customers come in.”
Follow reporter Steven Overly on Twitter: @StevenOverly