While not all retail-focused companies may be pleased about Google's recent algorithm change that favors mobile-optimized sites, the online coupon site RetailMeNot hopes that strategy will give the company a much-needed edge.
RetailMeNot reported a rocky first quarter earnings as its profit dipped 33 percent to $4.1 million, which was a decrease from 2013's Q1 of $6.1 million. Revenue for the quarter also declined by about 1 percent to $60.4 million. But revenue from mobile transactions, however, was a different story. Mobile online transaction revenue increased 137 percent, year over year, to $5.6 million, which represents 9 percent of total net revenues. Meanwhile, net revenues from desktop transactions decreased 14 percent to $47.1 million.
"We made solid progress this quarter in executing on our plans to further monetize our fast growing mobile audience," said Cotter Cunningham, RetailMeNot's CEO and Founder, in the company's earnings release. "In 2015, we continue to focus on innovating and investing in our highest growth areas such as in-store and mobile, increasing our audience of consumers coming directly to our marketplace, investing in a strong sales organization to deepen our relationships with retailers and looking for ways to help more consumers save money across the growing omni-channel landscape."
A company spokesman also provided some insight into Google's algorithm change. Because RetailMeNot's strategy involves aggregating retailers’ digital coupons onto its website and smartphone app (which generates it commission from retailers), the mobile aspect is particularly key for the company.
“We believe the latest Google mobile algorithm change could be a good thing long term. We think it encourages more retailers to optimize their often underdeveloped mobile commerce channels as more consumers use their mobile devices to shop,” RetailMeNot spokesman Brian Hoyt told The Wall Street Journal.