RetailMeNot Slides on Traffic Worries, Company RespondsTim Kennedy (Author) Published Date : May 30, 2014 00:17 ET
Netherlands-based online coupon and discount deal provider RetailMeNot Inc. (SALE) slides 15% in Thursday trading as investors worry about reports saying the company has lost up to one-third of its traffic due to search changes at Google Inc. (GOOG). The stock traded as low as $25.77, nearing a test of its $25.51 52-week low, but has pulled away from that low in part as the company has issued a statement downplaying the traffic speculation. Google said it was rolling out Panda 4.0, the latest upgrade to its search-ranking system, which is designed to eliminate lower-quality pages from its search results. The upgrade is also expected to affect the number of total English-language search queries and impact RetailMeNot's online traffic, MarketWatch reported, citing reports. RetailMeNot.com issued a statement in response: The company believes these reports greatly overstate the impact on RetailMeNot.com. Over RetailMeNot's history, search engines have periodically implemented algorithm changes that have caused traffic to fluctuate. It is too early to judge any potential impact of the latest Google algorithm change. While RetailMeNot's traffic with Google continues to grow year-over-year, the company has experienced some shift in rankings and traffic. The company continues to believe its focus on content quality and user experience will continue to help grow the business, enable consumers to save money and drive retailer sales. With RetailMeNot's 600,000 digital offers from over 70,000 retailers and brands, the company believes it offers consumers the largest selection of digital offers. Since a substantial portion of those offers are not monetized today, traffic fluctuations do not necessarily correlate to financial performance. At this time, RetailMeNot does not have an update to its financial guidance. RetailMeNot has made considerable strides to diversify its traffic sources. In the first quarter 2014, approximately 35% of RetailMeNot's traffic came from sources other than search engines. RetailMeNot has its highest brand awareness metrics in the company's history, and millions of consumers are coming to RetailMeNot directly through its mobile applications. RetailMeNot's strategy remains unchanged. The company will continue to strive to provide consumers with the best user experience and highest quality offers from leading retailers and brands.
RetailMeNot Slides on Traffic Worries, Company Responds