Trade Me says it's a two-speed business and needs to reinvest to grow revenue.
The company expects overall growth in 2014 will be slower than it was last year.
Net profit for the online auction site rose 4% to $78.6 million in the 12 months to the end of June.
But that increase is lower than in previous years - net profit was up 10% last year - and Trade Me puts this down to interest costs from debt taken on during its float as well as an underwhelming performance from its traditional auction activities.
This contrasts with a strong performance in its classified business.
About 40% of the goods sold on the site are new items and chief executive Jon Macdonald said the company is working to grow the online retail side of the business, but so far it hasn't lived up to expectations.
He said Trade Me is improving the design and functionality of its website and mobile platforms such as apps and it's hoped that will make it a better experience for buyers and sellers of new goods on the site.
Mr Macdonald said the next step is to approach sellers and retailers to persuade them that Trade Me is a good place for them to list their inventory and that it will help them reach new customers.
He said Trade Me also needs to convince the New Zealand consumer that Trade Me is a good place to buy new goods online.
Mr Macdonald also announced the company will buy the online insurance comparison business, LifeDirect.
Trade Me will pay a final dividend of 8.3 cents per share, up from 7.8 cents last year.
Shares in the company fell nearly 5% to $4.48 on Wednesday.
