Etsy is the latest company to lay off staff in 2023. CEO Josh Silverman confirmed Market is laying off 11 percent of its staff (around 225 employees) in its first significant workforce reduction in recent years. He is also reshuffling his management, notably announcing the departure of two leaders at the start of 2024.
“After extensive discussions and careful review, we are reorganizing our internal structure to more closely align our resources with our most important business priorities and better serve our customers,” Silverman wrote to employees. “As part of this, I’m sad to announce that we have to say goodbye to approximately 225 team members, reducing Etsy’s workforce by approximately 11%. This decision was one of the hardest we have ever made and one we sincerely tried to avoid.
The company faces a slowdown in consumer spending, as its executives warned during its third-quarter 2023 earnings call in November. “There’s no question that this is an incredibly challenging environment for consumer discretionary spending,” Silverman told investors last month. “It is therefore important to recognize that the volatile macroeconomic climate will make it difficult for us to grow this quarter.” Etsy’s revenue growth had already stalled in recent years as customers adjusted their spending habits post-lockdown following a pandemic boom.
Etsy CEO says Shein and Temu also affected the company’s bottom line. “There’s no question that Temu and Shein are having an impact on the market,” Silverman said during the November conference call. “You can’t reach this scale so quickly without taking the part of many people. »
However, competition between the two newcomers is not the only problem; Shein and Temu also reportedly drove up Etsy’s advertising costs. “And the other thing that’s happening is they’re spending a lot of money on marketing, without being clear that they’re using ROI thresholds to do that,” Silverman added. “So I think those two players almost single-handedly have an impact on the cost of advertising, particularly on some of Google and Meta’s paid channels.”
Silverman plans to market the platform’s “quality, value and reliability” to help fend off younger competitors who specialize in cheaper products. “I have great confidence in these plans, but we need the proper structure and resources to successfully implement them,” he wrote to employees.
The CEO wasn’t shy about talking a little either. “We are the opposite of Temu,” Silverman told investors in November. “If I had to think about what’s the opposite of Etsy, I’d probably go closer to Temu.”
As part of the reorganization, Etsy’s chief marketing officer, Ryan Scott, and chief human resources officer, Kim Seymour, will leave the company on January 1. Chief Operating Officer Raina Moskowitz will now lead the marketing teams, and Chief Product Officer Nick Daniel will inherit Moskowitz’s position. previous area, overseeing the payment and fulfillment teams.
This article was originally published on Engadget at https://www.engadget.com/etsy-is-laying-off-11-percent-of-its-staff-201545615.html?src=rss
