Google's offensive on the shopping guides market had a strong impact on Net sales in the fourth quarter

LeGuide group was confronted with the large scale roll-out of Google Shopping in the second quarter, resulting in a significant drop in traffic for all market players.

Consequently, in the fourth quarter of 2013 LeGuide group Net sales were down 15% to €11.5 million.

Taking the year as a whole, sales were up 4% to €45.6M (-2% on a like-for-like basis).

Ciao environment was strongly impacted by this particularly aggressive competitive environment while the group's historic activities, proved more resilient and recorded annual growth of 6%. The number of e-commerce merchants continued to grow during this period and is now at 82.300 - up 3% on last year.

Given activity levels and continued high investment levels, the group anticipates in the second semester a significant drop in operating profitability (RESOP) which will nevertheless remain positive at around €1 million.

A Case is under way at the European Commission who is waiting for Google to restore a balanced competitive environment

The European Commission is conducting an in-depth investigation into the practices of Google which is suspected of abusing its dominant position to pre-empt the shopping search engine market.

In order to avoid sanctions, Google offered to change its practices and give its competitors increased visibility. Its proposals were deemed grossly inadequate and were rejected by the European Commission twice. Negotiations are ongoing and may result in an outcome in 2014; if not, the European Commission may go down the route of statement of objections.

An aggressive three-pronged strategy: developing alternative traffic, turning Ciao around and rolling out innovations

The  LeGuide group is continuing to increase its share of alternative Google traffic. The group has also entered into a number of partnerships with leading players such as Wetter.com, Prisma Press and Tiscali.

Regarding Ciao, the Group has put in place a turnaround plan, 'Ciao Back on Track', targeting the following business areas:

  • Audience, improving user experience through site modernisation
  • Content, developing a community of contributors (reviews), which adds real value to the decision-making process of web-users
  • Search optimisation on the sites including a new design, optimised browsing and an improved search/offer matching function
  • Audience monetisation with an increase in click-through rate

In 2013 LeGuide group also heavily invested in powerful tools: a new datacenter, a more effective Business Intelligence platform, a new SEM platform to streamline traffic acquisition, etc.

Moreover, LeGuide group is continuing its policy of differentiation through innovation with new services for internet users and e-merchants.

Olivier Sichel, Chairman and CEO of LeGuide group, said: 'Those initiatives reflect the ambitious image of the group. Indeed, LeGuide Group is on its way to gain back growth in 2014. Besides, we will watch closely the European Commission's actions towards Google in order to restore a balanced competitive environment."

Next publication: Annual results on 4 March 2014 after close of accounts.

About LeGuide group, the European shopping guides leader

The LeGuide group, provider of shopping guides, price comparison sites, shopping search engines and internet review platforms, is number one in Europe with 19,3 million unique visitors*. The group has a 180-strong workforce and operates in 14 European countries, delivering its multi-site strategy out of several subsidiaries including LeGuide.com, Ciao, dooyoo.com, mercamania.com and choozen.com. The group, which lists 155 million offers from 82,300 merchants, turned over €45.6 M in 2013. The LeGuide.com group has been awarded 'Innovative enterprise' status by the French innovation agency OSEO and is listed on NYSE Euronext Paris's Alternext (tag ALGUI, ISIN code FR0010146092).

* Source: Comscore, December 2013

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