Groupon cuts over 500 staff, plans to focus ‘only on mission-critical activities’ from now on

techcrunch.com:

Chicago-based Groupon today laid off more than 500 of its employees — 15% of its 3,416-person headcount — according to posts from former employees on social media. The reduction impacted workers in teams including merchant development, sales, recruiting, engineering, product and marketing.

Groupon confirmed the layoffs to TechCrunch after the publication of the story.

“Our overall business performance is not at the levels we anticipated and we are taking decisive actions to improve our trajectory,” CEO Kedar Deshpande said in a statement provided to TechCrunch. The chief executive says that the layoffs, as well as a reinvestment in marketing and initiatives that drive customer purchase frequency, will set the company up to generate positive cash flow by the end of 2022.

In a letter to staff, Deshpande said that Groupon is reducing its North America sales teams to focus on “self-service merchant acquisition capabilities.” It is also re-organizing the company to focus “only on mission-critical activities and leaning on more external support.” “In addition, we are proposing to reduce cloud infrastructure and support functions as we wrap up cloud migrations.” Groupon is also closing its Australia Goods business, more than a decade after launching there in the first place. Finally, Groupon said that it will “rationalize” its real estate footprint to be more in line with hybrid work.

Coupon-finding Groupon has grown to have steep e-commerce competition since its founding in 2011. Rakuten and Honey, which sit on consumers’ browsers to scour the internet to show related deals, have grown into massive companies. All the platforms make money from affiliate fees and revenue-share partnerships, meaning the more competitors, the bigger