40 new jobs at Trade Me as site and app development pick up
By Pattrick Smellie
Oct. 30 (BusinessDesk) – Trade Me expects to invest more in the next year to inject higher growth into its general items auctions and expand its new goods offerings, chief executive Jon Macdonald told the annual shareholders’ meeting in Wellington.
Approximately 40 new “technologists” were being sought to work on a wide array of upgrades to the functionality of the auction site, which Colmar-Brunton has identified as the fifth “most loved” New Zealand brand.
Macdonald warned shareholders to expect “subdued” performance from Trade Me in the current financial year, in part because its dominant “general items” category of the site, had underperformed with just 4.9 percent growth last year.
However, 30 percent growth in classifieds revenue for cars, houses and jobs was “much better”, with classifieds now “delivering the bulk of earnings growth today,” said chairman David Kirk.
“On the other hand, the continuing development of the marketplace for new goods is the largest initiative where we are investing and incurring costs, to drive future revenue and earnings,” Kirk said.
There had been no increase in the rate of growth for general items in the first months of the current financial year, Macdonald said, and three competitors that took Trade Me on last year had sunk without trace.
Macdonald said there were opportunities both to improve margins and to combat print real estate advertising by moving to explicitly pricing Trade Me real estate advertisements in competition with print ads, rather than the typical tendency for agents to absorb online advertising costs in a marketing campaign.
The departure of Fairfax from online auction site Trade Me’s share register last December had been good for the company, the chief executive at Fairfax who led its purchase of Trade Me, told shareholders.
In particular, it had moved Trade Me into the NZX10 and ASX200 indices and helped boost market capitalisation.
Fairfax sold its remaining 51 percent of Trade Me to a range of institutional investors last December, to help debt pressures on the beleaguered Australasian media empire’s balance sheet.