Shopkick lays off about 10 percent of staff

Shopkick, a shopping rewards app owned by SK Telecom, laid off a little more than 10 percent of its staff (about 30 people) yesterday, TechCrunch has learned. Shopkick CEO Bill Demas confirmed the layoffs to TechCrunch, saying the layoffs were part of a broader restructuring of the business.

Shopkick, which was founded seven years ago, initially focused on physical retail stores and increasing foot traffic. Now, Shopkick is trying to focus more on e-commerce and mobile commerce. As part of that focus, Demas told TechCrunch Shopkick needs to invest in engineers, salespeople, data scientists and business development people.

“Folks that were more involved in the older model were more impacted,” Demas said. “We basically are using the freed up headcount to invest in areas like augmented reality, data science and online commerce.”

Over the next 12 months, Shopkick plans to hire about 20 people in these areas. Although retail is still important to Shopkick, Demas said, it’s not a huge area of growth. What is a huge area of growth, Demas said, is online and mobile commerce. So far, Shopkick has brought on nine or 10 retailers. That will increase to dozens of retailers later this year.

“What we are able to do is know what [shoppers are] doing in-store, where they’re going but also know what they’re doing online,” Demas said. “That creates an enormous amount of data and we want to be able to aggregate that data and give insights to the marketers — give them a better understanding of who their audience actually is.”

That’s why, as part of this restructuring, Shopkick is building a data platform to provide retailers and brands with more actionable data. While the old Shopkick was about getting people into stores and scanning products, the new Shopkick is about getting people to make purchases, determine their buying behaviors, collect their information and then provide insights to brands and retailers.

Last year, Demas took over as CEO and began rethinking Shopkick’s business. In April, Shopkick launched Shopkick Grocery to expand its offerings into grocery rewards and compete with the likes of Snap by Groupon, Checkout 51, Favado and others.

Although layoffs can sometimes signal turmoil at a company, Demas says that is not the case at Shopkick. He noted how revenues are going up and that Shopkick is “pretty rapidly moving toward profitability.”