Groupon: Mobile driving close to half of North American transactions
Groupon reported better-than-expected second-quarter sales, crediting its turnaround to the continued growth of its mobile commerce business: Close to half of the company's North American transactions are now completed on mobile devices, increasing from 30 percent in June 2012.
Groupon posted revenues of $608.7 million in the second quarter, up 7 percent over the year-ago period. North American revenues grew 45 percent year-over-year, offset by a 24 percent decline in the EMEA region and a 26 percent slide across the rest of the world. Gross billings--which reflect the total dollar value of customer purchases of goods and services--increased 10 percent globally to $1.41 billion, but gross profit tumbled to $384.7 million, compared with $433.2 million in the second quarter of 2012.
"[We] delivered our strongest quarter ever in North America, due in part to accelerated billings growth of 30 percent," said Eric Lefkofsky, who was officially named Groupon's CEO Wednesday after taking the helm on an interim basis in March following the ouster of founder and CEO Andrew Mason. "With two quarters on the job, I'm pleased with the progress we've made in such a short time. We continue to gain traction in mobile, with nearly 50 percent of our North American transactions coming from mobile in June. To date, more than 50 million people have downloaded Groupon apps worldwide."
Lefkofsky expanded on Groupon's mobile ambitions during the company's quarterly earnings call, noting that app downloads increased to more than 7.5 million worldwide during the second quarter, corresponding to nearly 15 million downloads in the first half of 2013 alone.
"We are preparing to be the first large-scale e-commerce company that is predominantly mobile," Lefkofsky said, according to a Seeking Alpha transcript. "To us, mobile commerce is everything you can buy, anywhere you are with the touch of a finger--all carrying a virtual shopping mall around in our pocket. It's commerce in a connected world where people infuse technology into their everyday buying patterns. It's all about interacting with your surrounding using geographic data to make purchasing more relevant, more personalized, more immediate, more efficient."
Lefkofsky added that Groupon must "get local right" to achieve its m-commerce goals. "We've made great strides in mobile but we have a long way to go," he said. "At our core Groupon's goal has always been the same--to bring the power of the Internet to local commerce by offering our customers unbeatable deals that they discover when they are out and about. Everything we do is local in mind. Our Live business features local concerts and events. Our Getaways business features local hotels. Our Goods business has enhanced interest in Groupon overall and over time we will be localizing our Goods platform by allowing local vendors to upload inventory they want to sell to our national audience and by allowing our vendors to offer local in-store pickup."
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