Businessmodel of LivePerson

Customer Segments

LivePerson provides a range of mobile and online messaging solutions on a commercial basis, primarily serving companies across several business sectors. The company states on its website that it provides solutions to customers across the following industries:

• Retail, including various types of retailer, across a range of retail channels, including online and physical sales outlets;
• Education, including universities, colleges, and other higher education institutions;
• Financial Services, including banking institutions, financial service providers, investment management firms and other financial institutions;
• Technology, including technology companies, IT service providers, and software developer;
• Telecommunications, including telecommunications providers, internet service providers, cable companies, and mobile network operators; and
• Travel, including travel agencies and booking agents, airlines, rail operators, and other transportation providers. LivePerson serves a number of high-profile companies, including Microsoft, Adobe, IBM, Intuit, RBS, and Virgin Atlantic. LivePerson additionally offers a range of services and products to consumers.

LivePerson’s core market is its native US, which accounts for the bulk of its business. The Company, however, also serves a large international client base across three regions: the Americas, Asia Pacific, and Europe, Middle East and Africa.

Value Propositions

LivePerson provides value to its clients in the following ways:

• Its reputation and industry standing, with the company established as a reliable provider of communications software solutions, having a positive track record within the technology industry;
• Its extensive range of communications solutions, with the Company offering a broad range of solutions, enabling commercial entities across multiple sectors – including the financial services, travel, and telecommunications industries – to communicate efficiently across a range of channels;
• Its partner network, with the Company working closely with a varied network of companies and organisations around the world to ensure that its clients are furnished quickly and efficiently, and with high-quality products;
• Its proprietary technologies, with the Company utilising a range of proprietary technologies in the development and implementation of its solutions, allowing it to offer products that are unique within the industry; and
• Its international sales reach, with the Company serving customers across various international markets in the Americas, Europe, Middle East and Africa, and Asia Pacific, as well as an extensive domestic client base in the US. ### Channels

LivePerson operates a website at www.liveperson.com, through which it provides information on its various products and services, target industries, and operating locations.

LivePerson operates an online sales channel through which companies can download and pay for subscriptions to its LiveEngage product. It also enables customers to request software demonstrations and custom quotes directly through its website. LivePerson also offers mobile applications that can be downloaded via the Apple App Store and the Google Play Store.

LivePerson makes the bulk of its sales through an in-house direct sales force that is organised by geographic region and by client line, including mid-market, enterprise and global strategic customers, and prospects. These sales personnel operate out of the Company’s across its operation regions, including locations in Japan, Australia, the US, Germany, Israel, France, and the UK.

LivePerson also seeks to establish partnerships as part of an indirect sales network. This includes partnerships with referral and affiliate partners, resellers, distributors, and independent sales agents.

Customer Relationships

LivePerson sells some products through an online self-service channel, which allows customers to download software and register accounts without interacting with members of the Company’s sales and service personnel. Customers are also able to access products and resources independently by logging into their accounts via the Company’s website.

LivePerson makes the majority of its sales through its direct sales personnel, who consult closely with clients in order to ensure that their individual needs are met. With its larger enterprise clients, the Company conducts research and discovery meeting that enable its service sales personnel to develop an understanding of key value drivers and circumstances, ensuring that the client receives an appropriate service. LivePerson seeks to maintain longstanding customer relationships through high-quality service.

LivePerson offers its customers ongoing support, with customers able to contact dedicated support personnel across multiple channels – including over the phone, via online chat service, and by email – at any time, receiving personalised technical assistance. The Company also offers a range of online resources that can be accessed independently, and oversees an online user community where customers can interact with one another and share ideas.

Additionally, LivePerson operates accounts with several social networks – including Facebook, Twitter, LinkedIn, Pinterest, and YouTube – through which it can publish company updates and interact directly with clients.

Key Activities

LivePerson is a provider of mobile and online messaging technologies that power digital communication between brands and consumers.

The Company aligns its operations into two reportable business segments: Business, which concerns the Company’s development of solutions that enable commercial clients to effectively facilitate online interactions through its cloud-based LiveEngage platform; and Consumer, which facilitates online transactions between independent service providers and individual consumers seeking information through mobile and online messaging.

The Company’s flagship product is its LiveEngage platform, which enables businesses to connect with consumers by offering instant messaging as a preferred communication channel. LivePerson is based in the US but serves a global client base, including commercial enterprises across multiple industries, such as financial services, travel, and telecommunications.

Key Partners

LivePerson works closely with a range of companies and organisations around the world. These partners can be organised broadly into the following categories:

• Supplier and Vendor Partners, comprising suppliers of services, equipment, and tools that are utilised in the development and delivery of its products, as well as companies to which the Company is able to outsource certain non-technical functions;
• Technology and Software Partners, comprising a range of technology companies, IT service providers, and software developers that assist in developing, integrating, and implementing the Company’s products and solutions;
• Business Partners, including industry consultants and business solutions providers that support the Company’s development and delivery of software products;
• Channel and Distribution Partners, comprising the Company’s network of independent software vendors, value added resellers, affiliates, and distributors that assist in extending the Company’s in-house sales reach; and
• Strategic and Alliance Partners, comprising market leading companies across multiple sectors, with which the Company collaborates on various joint projects, including in marketing, branding, and development. LivePerson names a number of its partners on its website. This includes a number high-profile companies such as IBM, Shopify, Xerox, Communication Science Group, Hinduja Global Solutions, and Monitise.

Key Resources

LivePerson’s key resources are its proprietary technologies and intellectual properties, its software products and online platform, its IT and communications infrastructure, its sales and distribution channels, its partnerships, and its personnel.

LivePerson owns a number of proprietary technologies and intellectual properties that are key to its core software development operations. Searches of records published by the US Patent and Trademark Office identified a number of patent applications filed under LivePerson’s name, including applications entitled ‘System and method for performing follow up based on user interactions’, ‘System and method for facilitating communication’ and ‘Systems and methods to facilitate selling of products and services’.

LivePerson additionally owns and or leases various physical properties around the world that comprise its network of sales and administrative offices.

Cost Structure

LivePerson incurs costs in relation to the development of its proprietary technologies and intellectual properties, the development of its software products and online platform, the maintenance of its It and communications infrastructure, the operation of its sales and distribution channels, the procurement of services, the implementation of advertising and marketing campaigns.

In 2015 LivePerson recorded total costs and expenses in the amount of $249.44 million. This included cost of revenue in the amount of $70.31 million, sales and marketing expenses in the amount of $94.73 million, general and administrative expenses in the amount of $37.17 million, and product development costs in the amount of $38.97 million.

Revenue Streams

LivePerson generates revenue through the development and sale of various software products, as well as through subscriptions to its online platform. The Company also derives revenue through the provision of various related services.

In 2015 LivePerson generated revenue for the year in the amount of $239.01 million, up on the $209.93 million recorded by the Company in 2014.