LivingSocial Taps eBay Ad Exec to Replace O’Shaughnessy as CEO
LivingSocial can begin its new beginning. The troubled daily deals site has hired Gautam Thaker, the former CEO of Shopping.com, to replace co-founder Tim O’Shaughnessy who announced he would step down earlier this year.
Thaker currently serves as the general manager of eBay’s advertising business and has served as the company’s head of international advertising as well as a country manager in India. He will take the helm in mid-August, and O’Shaughnessy will move to an advisory role, according to a press release posted on the company’s website Tuesday.
LivingSocial has struggled to regain its footing in recent years, after the daily deals bubble contracted. The company raised an astonishing amount of capital during the growth years of 2010 and 2011, but the market eventually turned away from the daily deal model, leaving LivingSocial overextended, with massive costs. The company lost $558 million in 2011, $650 million in 2012, and $183 million in 2013.
For better or worse, LivingSocial and Groupon face a similar set challenges. Both companies have painted themselves in a corner as a discounter, and face heavy churn due to a reputation as a one-time, or periodic, way for merchants to drive additional traffic — or for retailers to shed excess inventory.
But the problem starts with the consumer. In order to reduce the size of discounts it asks from merchants, the company needs to create a new set of incentives to engage consumers. For LivingSocial, that has meant improving its personalization algorithms to help deliver the right offers to the right consumers. The company is in the midst of rolling out a new “daily gem” product, which sends personalized deal each morning.
The company also appears to be doubling down on the convergence of content and commerce. In an interview with Street Fight in March, the company’s chief revenue officer, Doug Miller, touted the increasingly important role of editorial in the ecommerce business:
“I think you’ll see increasingly that e-commerce companies will mashing up or blurring the lines, with e-commerce companies like Amazon and Expedia increasingly looking like media companies and classic media companies increasingly trying to become transactional. Whoever it may be, there won’t be clean division between the two anymore.”
For both LivingSocial and Groupon, the biggest burden on their bottom lines was a disorganized international business. Last year, LivingSocial sold Tmon, the Korean ecommerce site to Groupon for $260 million, and then shed the remainder of its southeast asian assets in April to a local commerce firm. The company faces a deep hole, but without the international operations burning a hole in its pocket, its future isn’t quite dead yet.
Outgoing CEO Tim O’Shaughnessy spoke with Street Fight CEO Laura Rich during a fireside chat at Street Fight Summit in New York last year. Here’s the video:
Steven Jacobs is Street Fight’s deputy editor.