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Retail Me Not - Strategic Analysis

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by

Karina Gotuzzo

on 3 December 2014

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Transcript of Retail Me Not - Strategic Analysis

RetailMeNot Inc.
Strategic Analysis

BRIEF OVERVIEW
Rapidly growing tech firm based in downtown Austin

A diverse leadership team with wide range of experience

The firm started in 2010 when purchased by WhaleShark Media

Rebranded to RetailMeNot in June 2013

IPO offered in July 2013

Acquired 10 companies since 2009

Grew from 35 employees in December 2010 to 444 employees in December 2013

SWOT ANALYSIS
OPPORTUNITIES & THREATS
FINANCIAL ANALYSIS
REVENUE BY GEOGRAPHY
CURRENT RATIO
TIMES INTEREST EARNED
SWOT ANALYSIS - STRENGTHS & WEAKNESS
OPERATING MARGIN
NET PROFIT MARGIN
FINANCIAL CONCLUSION
The financial performance for RetailMeNot has improved over the past three years and its financial condition is strong

Total revenue has increased each year to $209,836,000 in 2013

Current ratio has increased each year to 5.67 in 2013

Times interest earned is well above the industry average at 17.92

The operating margin is 25.1%

The net profit margin is 15%

INTERNAL ANALYSIS
CORE COMPETENCIES AND COMPETITIVE ADVANTAGES
Global Presence
Acquisitions of foreign businesses have been profitable

Amount of cash on hand
Effective use of cash provides advantage

Use of technology
Innovations provide consumers and retailers more value

Do not maintain inventory
Low cost of revenue

STRATEGIC ANALYSIS
KEY STRATEGIC ISSUES
INDUSTRY MACRO-ENVIRONMENT FACTORS
PRIMARY STRATEGIC CONCERN
RELIANCE ON PERFORMANCE MARKETING NETWORKS

INTERNAL DEVELOPMENT
Advantages:
Cost Savings
Full System Control
Integration concerns

Challenges:
Establishing reputation as a recognized publisher
Building an effective in-house technology solution
Developing an effective vendor management system

ACQUISITION
Advantages:
Quickly bridging the resource and technology gaps
Immediately obtaining expertise and market position
Experience in acquisitions


Disadvantages
:
cost to purchase
cost of cultural and organizational integration

RECOMMENDATION:
STRATEGIC GROWTH THROUGH
STAGED ACQUISITIONS
IMPLEMENTATION TIMELINE
BUDGET
History of Amount Spent and Net Revenues from Acquisitions
*Amounts in Millions

BUDGET
Proposed Budget:
$20-60m for each acquisition, up to $200M

BUDGET
Commission Junction (Conversant), purchased in 2014 for $2.3b
LinkShare, acquired by Rakuten Marketing in 2005 for $425m Cash


ASSESSMENT CRITERIA
Amount of Product and Industry Knowledge Obtained

Efficiencies Gained in Revenue Stream, Commissions Payments

Degree of Leadership or Market Share the Acquired Company(s) Represent in the Performance Marketing Industry

Q&A
Thank You!
Aaron Dutton, David Alviola, Karina Gotuzzo, Katelyn Buckley and Kelli Raymond

BA 5351 Fall 2014

Texas State University
Full transcript