After enduring a torrid few months, Groupon has confirmed a shakeup of its international business, bringing in a new chief to oversee operations outside America.
Out goes Marc Samwer, the oldest of the three notorious Samwer brothers, who became head of outside the U.S. when his family sold their Groupon clone — the German-headquartered Citydeal — to the company in 2010.
In his place comes Austrian Veit Dengler, an executive who has served time at Dell, T-Mobile, McKinsey and Procter & Gamble. According to Crain’s Chicago, sales and marketing veteran Dengler has been brought in to help drive growth, with his predecessor moving to an advisory role.
Mr. Dengler, a native of Austria, will run Groupon’s overseas business from its international headquarters in Schaffhausen, Switzerland. With a business career stretching 25 years, including stints at Procter & Gamble, Mr. Dengler adds experience to Groupon, which has struggled to keep up with its hyper growth. He recently ran computer maker Dell’s Eastern European and Russian operations.
What that report misses, however, is that there’s a lot of important context that may have played a major part in this decision.
So why did Marc Samwer go?
Perhaps it was just time to move on: after all, two years after an acquisition is not unusual for an entrepreneur to earn out and head off to the next challenge. Marc Samwer has plenty going on with Rocket Internet.
But life at Groupon is pretty complicated right now.
The company finds itself embroiled in an accounting scandal — forced to restate its earnings after the discovery that it had understated operating expenses, an action that has prompted the SEC to consider an investigation.
Meanwhile the international business, which is responsible for around two thirds of the company’s revenue, has been finding itself under fire too.
Most notably, Groupon’s U.K. operation — which was brought in with the Citydeal purchase and reported to Samwer — has been censured by regulators after consumers filed so many complaints that it was found to have breached advertising codes a record 50 times in a single year.
After what the country’s financial watchdog called “widespread” problems, the company was told to fix a number of problems centered on the way it advertises offers, works with other businesses, and responds to customer complaints.
After an investigation that was started in December by the Office of Fair Trading — Britain’s equivalent of the Federal Trade Commission — the site was told that it had breached consumer regulations on a wide range of occasions and given a three month deadline to fix its wrongdoing, or face legal action.
“The investigation found widespread examples of Groupon’s practices which in the OFT’s view breached consumer protection regulations,” said the watchdog. ”The OFT has specific concerns over practices involving reference pricing, advertising, refunds, unfair terms, and the diligence of its interactions with merchants.”
That led Groupon to make a “commitment to customers” in which it promised to fix things. But critics have yet to be silenced.
Moving Marc, and his brother Oliver, into advisory roles will take them away from the leadership and decision making at Groupon — and although with around 6.5 percent of the company’s stock they will still be involved — it’s an interesting shift from the Chicago business.
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