Groupon Inc. today announced it hired Steve Krenzer as its chief operating officer, effective immediately. He will oversee the company’s North America and international segments, as well as global marketing and global operations.
While Krenzer was most recently CEO of direct-response advertising vendor Core Digital Media, he was CEO of PriceGrabber from 2011-15 and president of Experian Interactive Media from 2008-12, according to his LinkedIn profile.
“The opportunity to add a high-horsepower e-commerce leader like Steve doesn’t come along very often,” says Groupon CEO Rich Williams. “His combination of industry savvy, deep operational experience and intimate understanding of digital marketing is equally rare. Steve will immediately put those skills to work as we continue to advance our vast local marketplace.”
Groupon’s chief operating officer position had been vacant since Williams was promoted from the role in November 2015.
The hiring news comes the same day that Groupon reported that revenue from Groupon Inc.’s Goods business, the division of Groupon that sells physical goods, fell 17.2% in the third quarter compared with the year-ago period, while its gross profit on those sales grew 8.2% to $55.7 million from $51.5 million a year earlier.
Those results are in line with Williams’s push to reduce what he calls “empty calories,” the low- to negative-margin products that drive short-term increases in revenue but do little to generate long-term profits. Groupon’s overall profit grew 5.5% in the third quarter.
Cost-cutting contributed to the profit improvement: Groupon’s head count was 6.6% lower than a year ago.
As Groupon’s business evolves, the company is increasingly focused on higher-margin products, including what it calls voucherless promotions, which are offers that link to a consumer’s credit card and don’t require him to buy a voucher before he ventures into a store or restaurant.
“We moved forward on our core strategic initiatives and posted solid results, particularly in North America local and in our international segment, despite some business disruption from a devastating hurricane season that had significant effects on both our merchants and customers in some of our larger North American markets,” Williams said during a conference call with analysts. “As we head into the holiday season, we remain focused on running an efficient and effective business, delivering an amazing customer experience and growing the depth and breadth of our platform, all while driving strong gross profit growth.”
For the quarter ended Sept. 30, Groupon, No. 26 in the Internet Retailer 2017 Top 500, reported:
- Total revenue of $634.5 million, down 7.6% from $686.6 million a year earlier.
- North American revenue of $414.2 million, down 14.3% from $483.3 million.
- International sales of $220.3 million, up 8.4% from $203.3 million.
- Groupon Goods revenue of $340.7 million, down 17.2% from $411.3 million.
- Groupon Goods profit of $55.7 million, up 8.2% from $51.5 million.
- North American revenue for Groupon Goods of $201.8 million, down 29.4% from $285.8 million.
- North American profit from Groupon Goods of $30.9 million, down 1.9% from $31.5 million.
- International revenue for Groupon Goods of $138.9 million, a 10.7% increase from $125.5 million.
- International profit from Groupon Goods of $24.7 million, up 23.5% from $20.0 million.
- A gain from continuing operations of $3.8 million compared with a $34.4 million loss.
- Net income of $59.0 million compared with a year-ago loss of $38.0 million.
- Gross billings, which reflect the total amount consumers paid for Groupon vouchers, excluding applicable taxes and refunds, stood at $1.341 billion, a 1.4% increase from $1.323 billion.
For the first three quarters of the year, Groupon reported:
- Total revenue of $1.971 billion, down 6.5% from $2.109 billion a year earlier.
- A loss from continuing operations of $22.5 million compared with a $126.8 million loss.
- A net loss of $33.7 million compared with a year-ago loss of $142.0 million.