Groupon Inc. (GRPN)

[FUNMAN]

Groupon lays off 100 in Chicago

JOHN PLETZ ON TECH


http://www.chicagobusiness.com/article/20170414/BLOGS11/170419908/groupon-lays-off-100-in-chicago


Groupon is cutting about 100 in Chicago, as the online deals company continues to reorient the business.

"We had a small number of position eliminations in the Chicago office this week," a spokesman said. "Overall, part of our ongoing efforts to streamline and simplify the business."

The company now has about 2,000 workers at its Chicago headquarters, roughly flat from a year ago but down from a peak of about 2,500 five years ago after it went public. The job cuts, reported earlier by the Chicago Tribune, are part of an ongoing shakeout at Groupon and across the online-deals business. Groupon acquired competitor LivingSocial for next to nothing after purchasing TicketMonster, a Korean deals company, for a steep discount.

Although Groupon has won the war in the deals business, it's still got plenty of battles ahead. CEO Rich Williams is trying to turn the company around, closing marginal operations in various countries, while refocusing it on the more lucrative parts of the business in an effort to achieve sustained profits and growth.



Groupon's revenue was flat last year, while operating losses doubled to $183 million. The company generates more than $100 million cash annually, however.

"It's about focus, discipline and how we interact with customers" is how Williams described his mission to me when Groupon reported fourth-quarter earnings in mid-February. "We have to simplify and streamline."

Groupon is cutting the number of countries it serves from 47 to 15. "We were fighting too many battles we didn't need to fight," said Williams, who became CEO at the end of 2015.

Last year, Groupon reduced headcount by 16 percent to 8,323, with most of the cuts coming overseas. North American headcount was down 9 percent.

"We have to make the business more consistent to run and make it more valuable for merchants and customers," he said. "We're here to grow profitability. We're not chasing low-margin sales that are good for revenue but not profitable."

It's tricky balancing act. The company has to spend more on marketing to add customers and get them to shop more often, while investing in technology, from its mobile app to the data analytics behind the scenes.

No one said the job would be quick or easy.