Can LivingSocial Bounce Back?

CMO Barry Judge says this is its best holiday season ever

Headshot of Christopher Heine

After 13 years at retailer Best Buy, Barry Judge last February joined LivingSocial as marketing chief, right around the time the daily-deals site looked like a sinking ship. Industry watchers questioned the 6-year-old company’s ability to find cash as they also wondered about its relevancy among Web-deals-weary consumers. Then, things got worse. LivingSocial’s site went dark for 40 hours leading up to Black Friday. Meanwhile, the company’s viability now hinges on the $260 million sale early next year of South Korean property TicketMonster to rival Groupon. It’s just one of the things Judge must grapple with heading into the new year.

The two-day server outage in mid-November was unfortunate. Has it affected holiday sales so far?

We did some aggressive marketing after it happened, and we recovered everything we had lost from that outage. And we discovered our customers missed us. We saw a 57 percent increase year over year in Black Friday sales while getting a 69 percent increase for Cyber Monday. Cyber Monday was our biggest shopping day in history, and that week was the best week in our history.

Is LivingSocial making a comeback?

That’s yet to be written. We think there is a lot of vibrancy in the local-advertising category. It’s an area still dominated by print, radio and billboards, which are all hard to track. People’s media consumption is moving online, and we have a performance-based digital advertising toolbox.

The TicketMonster sale going through next quarter looms large. Are you concerned?

[Uncomfortable laughter] No, I am excited. I am not concerned.

So you are going to have a sizable marketing budget?

We are focused on growth. So we will be spending money on marketing.

Email has been the lifeblood of your company. Is the list still growing?

We pulled back on our marketing efforts this year and altered our business model, so our mailing list isn’t growing at that same rate as our focus has changed to include more social and mobile. We are getting more users to tell their friends about our deals. Of the new email subscribers, 40 percent are referred by a friend.

How exactly are you tweaking the model?

We pivoted from being a daily-deals site to more of a deals marketplace, so we went from 3,000 deals to having more than 12,000. As we’ve done that, we’ve pulled back on our marketing efforts. Going into 2014, with improvements to our business model and additional funds available from the sale of TicketMonster, we expect to spend a lot more money.

How else are you growing the company?

We’ve launched a new coupons channel for retailers. They [include] offers from Nordstrom, Best Buy, Target, Walmart, etc., that can be claimed via LivingSocial. We have seen a tremendous amount of traffic through that offering. It’s a unit we will continue to invest in.

Coming from Best Buy, how does this gig differ?

There’s got to be value for the merchants to want to be there, and there has to be enough value for the consumers to buy the offers. From all of that, there’s got to be enough value left for us. It’s a more complicated balancing act than a pure retailer.

What gift do you want for the holidays?

Well, I still have electronics in my blood. So yeah, I’d like a Kindle Fire HDX.


@Chris_Heine Christopher Heine is a New York-based editor and writer.