Online Retail

Scott Thompson on Life After Yahoo


Scott Thompson, in 2010

Photograph by Aaron Harris/Bloomberg

Scott Thompson, in 2010

The year 2012 has been an eventful and unpleasant one for Scott Thompson. In January he left his post as head of Ebay (EBAY)’s PayPal unit to become the new chief executive officer of Yahoo! (YHOO). In May activist shareholders revealed that an entry on his résumé claiming that he had a bachelor’s degree in computer science was inaccurate. Less than two weeks later, Thompson was gone from Yahoo, undergoing treatments for thyroid cancer and seemingly vanquished from the Silicon Valley scene.

Now, the comeback: Thompson has signed on as CEO of ShopRunner, which is organizing a consortium of retailers to offer perks like free two-day shipping for online purchases.

The appointment appears to be a significant demotion for Thompson. In a few months, he’s gone from the major leagues of a Fortune 500 company to the minors as chief of a private company with a lofty mission to match the speed and innovation of archrival Amazon.com (AMZN).

In an interview over the weekend, Thompson says he’s excited by ShopRunner’s ambitions and has a longtime kinship with its founder, Michael Rubin, and president, Michael Golden, whom he met while working at PayPal. “What they have been trying to do over the past couple of years is fundamentally necessary,” he says. “How do you help small, medium, and emerging large businesses online and offline to compete against scale competitors? There’s a big opportunity to create an enormous business that has an effect on e-commerce and commerce overall.”

Thompson declined to talk about the excruciatingly public and painful events that lead to his departure from Yahoo. Does he have another explanation for the apparent embellishment on his résumé ? We may never know—and perhaps it’s wise for him to avoid stirring up that hornet’s nest again.

He does have kind words for Marissa Mayer, the former Google (GOOG) executive hired this month as his replacement at Yahoo. “I haven’t met Marissa, but from what I’ve read and heard about her, I suspect she’s an excellent person to lead Yahoo into the next stage,” he says. “I hope she’s extremely successful starting on Day One and for as long as she’s there. The only other comment I have is that I met a lot of great people in my time there, and I’m rooting for them.”

Thompson also says he is cancer free after surgery and a series of treatments. “My health is improving, and of course I’m exceptionally blessed in that regard,” he says. “The issue caught me completely by surprise.”

Thompson has his work cut out for him at ShopRunner. For a $79 annual membership fee, the service offers free two-day shipping (and free returns) on items purchased at the Web sites of participating stores such as Toys R’ Us, GNC (GNC), Sports Authority, and Drugstore.com. The company does not disclose the number of consumers who have signed up, and appears to be struggling to enlist larger merchants such as Target (TGT), Macy’s (M), and Wal-Mart Stores (WMT).

“It’s been slow to get retailer adoption, and we have not heard from the retailers that have signed up that it has raised their sales,” says Scot Wingo, CEO of Channel Advisor, an e-commerce consulting firm. “It does not have as cohesive a message as Amazon Prime,” Amazon’s own shipping program.

Recently ShopRunner has started to develop services that Amazon might find difficult to match. One, called Pickup Points, is aimed at customers who can’t or don’t want to have items delivered to their homes. Buy an item from the Web site of GNC, for example, and you can pick it up at another store like Toys “R” Us. Thompson believes this could be ShopRunner’s breakout feature because “it will bring customers into your store when they wouldn’t have come in previously, and you don’t have to bring them in by offering 20 to 30 percent off to get them in the door.”

Like everything else about Thompson’s year, there’s going to be a touch of awkwardness to his new gig. ShopRunner was developed as part of GSI Commerce, and when EBay acquired GSI last year it spun off ShopRunner and some other assets but retained a 30 percent ownership stake. Thompson left EBay for Yahoo abruptly, giving only a day’s notice, and there appeared to be some bad blood: In a letter to employees posted on the EBay blog, EBay CEO John Donahoe called Thompson’s departure a “shock.”

ShopRunner is based in Conshohocken, Pa., near Philadelphia, although it has the Menlo Park (Calif.) offices of ShopSanity, an e-commerce startup it acquired earlier this year. Thompson says he will work from both locations and travel frequently to meet with retailers.

Thompson says he’s not seeking public vindication in his new post. “When you go through an event in your life that I went through, just on the health side, you have your eyes opened for the first time: ‘Oh my God, there is something more important than what I do for work,’” he says. “I’m thinking about this as what makes sense at this stage. The profile of this opportunity maps to what I want to do—taking a step back and doing something at a much smaller, much earlier stage that doesn’t have certainty around it. I’m fascinated by that part of it. There’s no emotion or vindication or anything like that. This is just what I want.”

Stone_190
Stone is a senior writer for Bloomberg Businessweek in San Francisco. He is the author of The Everything Store: Jeff Bezos and the Age of Amazon (Little, Brown; October 2013). Follow him on Twitter @BradStone.

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