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LivingSocial Australia cuts 24 jobs as parent company restructures

Patrick Stafford /

The local office of group buying giant LivingSocial has cut 24 employees, or about 9% of its workforce, as the company attempts to restructure itself worldwide in order to reflect the changing nature of the group buying industry.

The move comes just days after the company itself told SmartCompany the business was in a strong position, especially when compared to local players owned by media entities.

Sam Yip, senior research manager at Telsyte, told SmartCompany the move is a sign of the pressures facing the industry, which include a customer base that has become fatigued with daily deals.

“We saw this rapid growth in all of the large companies, and really, that growth was building up sales teams and experts,” Yip says.

“There was a lot of focus on brand awareness in the first 24 months. But people know the concept of group buying now, they know how it works.”

In a statement, the company said the layoffs would occur as part of the company’s “strategic planning process”.

“As a result of that review, we have notified approximately 9% of our local workforce – or 24 employees – that their positions are being eliminated.”

“This process will give us the appropriate cost structure, so we can make additional investments in mobile, marketing, and customer support, while continuing to provide the best experience for both consumers and merchants in Australia and New Zealand.”

The layoffs were announced by LivingSocial as part of a worldwide restructure, but until now the size of the Australian job cuts was not known. Globally the company has cut 400 jobs.

As SmartCompany reported last week, the group buying industry is undergoing massive change as businesses consolidate. Last year there were about 100 sites in the local industry – today there are only about 40.

Last week, Adam Rigby from the local arm of LivingSocial told SmartCompany that he feels the company is in a strong position, especially when compared to local entities owned by media companies.

“All internationally-based organisations have overheads and complexities, but I think they’re far less distracting than the problem of having a whole different corporate agenda,” he said last week.

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Patrick Stafford

Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.

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