JD.com CEO Xu Lei is departing China’s No. 2 online commerce firm after more than a decade of climbing the ranks. He’s handing the reins to chief financial officer Sandy Xu starting June. While the outgoing CEO only officially took up his role around April 2022, he headed up JD’s core retail division for years. He was once regarded as the heir apparent to billionaire founder and chairman Richard Liu.

The management shuffle was announced after JD on May 11 reported revenue grew 1.4% to of 242.96 billion yuan ($35 billion). That beat projections but was the company’s lowest-ever pace of expansion. It swung from a loss to net income of 6.3 billion yuan in the March quarter, helped by 2.8 billion yuan of investment gains.

Meet the new boss

The incoming CEO is a two-decade auditing veteran who spent time with PriceWaterhouseCoopers. She now takes up the task of reviving one of China’s largest and highest-profile public companies. JD’s results, the first from a major Chinese tech company for the March quarter, suggest the internet sector is making some headway in efforts to eke out top-line growth, but still struggling to regain momentum after years of punishing COVID Zero restrictions.

JD’s performance was a far cry from the double-digit percentage expansions of previous years, before Beijing’s 2021 clampdown on internet spheres from online commerce to ride-hailing chilled a once-booming, free-wheeling tech sector.

JD.com is No. 1 is in the Asia Database. That’s Digital Commerce 360’s rankings of the largest online retailers in Asia by web sales. Rival Alibaba Group Holding Ltd. owns Taobao, No. 1 in the Digital Commerce 360 database of Global Online Marketplaces. It also owns Tmall (No. 2). JD.com is No. 4.

The legacy of the outgoing JD.com CEO

The 48-year-old outgoing CEO Xu, known for devising JD’s signature “6.18” sales bonanza, said in a statement he was quitting to devote more time to family. His successor becomes one of the few women chiefs of a major technology company. She emphasized in the same statement that Xu will remain involved with the company.

Xu leaves behind a legacy that includes introducing the rival to Alibaba’s Nov. 11 Singles’ Day gala, pushing back against internal opposition to roll out the weeks-long equivalent event around the company’s June 18 anniversary. He also stepped up during the company’s low points — including an investigation into Liu over alleged rape in 2018. He trimmed the workforce and cut units that weren’t contributing to growth.

JD’s earnings gave investors a sense of what to expect when Tencent Holdings Ltd., Alibaba and Baidu Inc. report results next week.

The future of JD.com

JD is now spending on incentives to ward off intensifying competition from rival merchants as well as social media platforms such as ByteDance, owner of TikTok. It launched a 10 billion yuan discount campaign to capture new Chinese users in March even as it pulled away from Southeast Asian ecommerce. It closed its Indonesian and Thailand ecommerce sites to try to shave costs elsewhere.

Xu Lei stressed on a call with analysts that he would continue to support the company as chairman of its advisory council. He lauded his successor for working alongside him in 2018 through JD’s “so-called darkest moment.”

On the company’s discount programs, his successor said the strategy sought to offer consumers wider price ranges and product categories, in an adjustment to post-pandemic shopping patterns.

“We are confident in our ability to control the overall costs of this program,” she said. “It has limited impact on our margins.”

JD had avoided the worst of the years-long crackdown that hit Alibaba. In March, Alibaba made the historic decision to split itself into six business units that could seek independent fundraising and listings.

JD.com itself has spun off several units including JD Health International Inc. It is in the process of listing its property and industrials businesses in Hong Kong. It would remain the majority owner of both companies, which haven’t disclosed fundraising plans.

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Emily Newton

Many new ChatGPT supply chain applications are emerging as generative AI becomes more advanced. So how can industry professionals utilize this technology effectively? They can use ChatGPT in several critical ways, primarily communication and automation.

1. Supply Chain Customer Service

Customer service is one of the most promising applications for ChatGPT in the supply chain. The natural language processing capabilities of ChatGPT are among the most advanced ever developed for popular use. This makes it an ideal tool for navigating the complex communication required in customer service tasks.

Any developer can integrate ChatGPT into their apps today using OpenAI’s official API for the algorithm. ChatGPT’s language processing skills can be applied to any customer-facing application in the supply chain, whether B2B or B2C. For example, a supplier could create a ChatGPT app for its manufacturing customers to track shipments of materials and resources.

2. Translation and International Relations

Succeeding in today’s supply chain requires working closely with partners worldwide. Unfortunately, language barriers make this challenging, potentially hindering organization and efficiency. Luckily, translation is a great way to use ChatGPT in the supply chain.

Research shows that users don’t need to specify the source language of a text passage for ChatGPT to translate it successfully. The algorithm can autonomously detect the source language and translate it in seconds.

ChatGPT’s performance is also on par or better than most digital translation tools available today. The fact that it can process natural language, including advanced technical terminology, gives it a major advantage over competitors. Its accessibility makes it ideal for supply chain applications, which rely on quick turnaround times and clear communication.

Using ChatGPT for translation can strengthen collaboration with international supply chain partners, improving efficiency and organization for everyone involved.

3. Automating Business Tasks

Businesses can use ChatGPT in the supply chain to automate various everyday tasks. For example, it can summarize a sales report, extract the highlights from a spreadsheet or draft an email. These tasks might seem small, but they help supply chain professionals work more efficiently.

ChatGPT can even be helpful for complex logistics tasks. AI is already making advances in logistics. For example, algorithms can automate order processing and help managers identify important insights in their data. This could include tasks like analyzing a list of suppliers to find those with the best rates or assessing various packaging options for the most cost-effective solution.

ChatGPT takes existing applications for AI in robotic process automation a step further. Advanced natural language processing helps it handle more complex content and user requests. Even integrating it into a larger automated system could improve performance.

4. Personalized Employee Training

ChatGPT is a great tool for improving employee training. This is especially helpful today since many supply chain businesses are adapting to new technologies and grappling with labor shortages. Surveys show 57% of supply chain leaders report hiring and retaining employees as their top challenge. Additionally, 41% have issues upskilling or reskilling existing workers.

Supply chain businesses can help alleviate these challenges by integrating ChatGPT into their training programs. It can serve as a multipurpose assistant for trainees by answering questions, explaining complex topics, and creating practice tests and flashcards. Employees can use ChatGPT to get a personalized training experience catered to their needs and learning styles.

Some trainees might quickly grasp a new technology, while others will want more time to explore definitions, technical terminology and other background information. ChatGPT can serve various training approaches, making it a versatile tool for providing more efficient employee training.

5. Data Analysis and Visualization

Data analysis and visualization is a lesser-known application for ChatGPT in the supply chain. Most people think of it as a language-specific AI, but it can also process numerical data.

Rapid and accessible data analysis tools are vital today. Data-driven insights and decisions are a cornerstone of Industry 4.0, which is rapidly reshaping the supply chain. ChatGPT makes basic AI analytics quick and straightforward. Anyone can paste a set of unstructured information into ChatGPT and ask it to summarize or organize it into a table.

Automating this task allows supply chain employees to have a more efficient workflow and leverage data more easily. ChatGPT can’t do complex data analytics yet, but it can handle many basic processes that are helpful for quickly getting an overview of a data set.

6. Idea Generation

Idea generation is a unique application for ChatGPT in the supply chain. Businesses need creative solutions to new challenges as things become more complex. Generative AI platforms like ChatGPT can be surprisingly helpful in the brainstorming process.

An AI might pinpoint unconventional solutions or ideas a human would not have considered. ChatGPT’s suggestions may not always be usable or feasible, but they provide a unique perspective that can spark creativity among team members.

Potential Drawbacks of ChatGPT

ChatGPT may be a powerful tool for certain applications, but it isn’t perfect. Business leaders should know about the drawbacks and challenges of adopting ChatGPT.

For example, ChatGPT has been known to give users inaccurate or completely made-up information. The AI’s language processing skills allow it to convey this false data convincingly, making it challenging to detect accuracy at a glance. Some groups, such as the coding help site Stack Overflow, are even banning ChatGPT due to the spread of misinformation.

This broadcast ofmisinformation is a huge problem in applications where users may be poorly equipped to verify that ChatGPT’s generated text is accurate. For example, using the AI for translating could lead to confusion if ChatGPT misunderstands the input or output language. Similarly, a new employee using ChatGPT for job training might learn incorrect information due to answer errors.

These issues may improve with time. The latest version of ChatGPT, GPT-4, is reportedly 40% more likely to give factual data, according to developer OpenAI. However, it will likely take years for ChatGPT to become a reliable source of information. Even then, there is always a chance the AI could “hallucinate” incorrect conclusions from the given data. ChatGPT’s output should always be fact-checked.

Adopting ChatGPT in the Supply Chain

There are many ways to use ChatGPT in the supply chain today, ranging from translation to employee training to logistics automation. Businesses can improve efficiency and productivity by integrating it into their workflows. OpenAI offers an API any developer can use to build ChatGPT into their app or website. In the years ahead, more supply chain applications will likely emerge as the technology advances.

About the author:

Emily Newton is an industrial writer reporting on how technology disrupts industrial sectors. She’s also the editor-in-chief of Revolutionized, covering innovations in industry, construction, and more.

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“I don’t want to bury the lede: after today, Shopify will be smaller by about 20% and Flexport will buy Shopify Logistics; this means some of you will leave Shopify today,” CEO Tobi Lütke said in a memo to staff. “I recognize the crushing impact this decision has on some of you, and did not make this decision lightly.”

The company expects to incur severance charges of $140 million to $150 million.

“Our numbers were unhealthy, just like it is in much of the tech industry,” Lütke said. “With the right numbers, we’ll fully focus on outcomes and impact.”

Shopify earnings

The ecommerce platform provider also announced its fiscal first-quarter earnings on May 4. It said revenue increased 25% to $1.5 billion compared to the prior year.

Gross merchandise volume, the total value of merchant sales across Shopify’s platforms, was $49.6 billion. That’s above Wall Street projections of $47.68 billion, and some $6.4 billion higher than comparable quarter of 2022.

The Ottawa-based company also gave an outlook for the second quarter, saying it expects revenue to grow at a similar rate to the first quarter growth rate on a year-over-year basis. It also expects to achieve free cash flow profitability for each quarter of 2023.

Shopify bet early in the pandemic that a rapid rise in online shopping, fueled by customers staying home, would become permanent. As that wager soured, Lütke has attempted to turn the company around. It cut about 1,000 jobs last summer, raised prices and focused on building out client offerings and its in-house fulfillment network. Shopify had 11,600 employees at the end of 2022.

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Devashish Saxena, chief digital officer, Imperial Dade

Imperial Dade, a major distributor of food-service packaging and janitorial supplies, is ready to take to a higher level its B2B digital commerce interactions with customers.

Devashish Saxena, as a former head of digital commerce at several large companies, has plenty of ecommerce experience behind him as he takes on his new role as Imperial Dade’s first chief digital officer.

“We will put the customer at the center of everything we do,” he says in this exclusive DC360 interview. “Through a data-driven approach, we will gain insights that enable us to anticipate their needs and exceed their expectations.”

Digital Commerce 360: You’ve built digital organizations at major companies including PPG, Rexel, Premier Farnell and Texas Instruments and guided them in making data-driven decisions to deliver business impact. What are some of the experiences that stand out for you where digital technology and strategy made a positive difference?

Devashish Saxena: At Texas Instruments, I was part of a team that revolutionized TI.com from a static brochure-ware site to a dynamic, user-focused design engineering tool that became the go-to destination for TI’s customers. We built a thriving design engineering community, E2E.TI.com, which remains a driving force today. Our team also created data frameworks that accurately measured the ROI of online conversions, connecting them to offline sales performance. The impact of our work at TI cannot be overstated – we changed the way TI interacted with its customers and transformed the company’s digital presence.

As digital employee No. 1 at Rexel and PPG, I was essentially a startup founder within two global powerhouses. At Rexel, we shifted the company’s focus from being a logistics company into a value-added, data-driven omnichannel distributor that saw €2.2B (US$2.4 billion) in digital sales in 2018 — all in less than five years.

This transformation was a human-centered effort, where digital technologies were key to driving organic growth. At PPG, we established AI as a core and integral part of our digital strategy, creating an AI factory that identified and scaled use cases across the value chain. As an example, an AI scaling effort in manufacturing at PPG could drive a few hundred million dollars in EBIT at scale. These milestones will stand out as significant achievements in both companies’ digital journeys.

DC360: As Imperial Dade’s first chief digital officer, how are you enjoying the new role? How can you use your C-level position to coordinate efforts companywide to build a solid digital and omnichannel strategy?

Saxena: As Imperial Dade’s first chief digital officer, I am thrilled to be leading the company’s digital transformation journey. The warm welcome I have received from every corner of the organization — from our CEO to employees in Sales, Marketing, Customer Service, Finance, Operations, and HR — has been nothing short of phenomenal. The positive energy and excitement for what lies ahead are palpable. It’s an honor to be part of a team that understands the significance of this journey and is committed to making it a success.

Driving a digital strategy is not just about adding new tools or technologies — it’s about fundamentally changing the way a company creates value. This is why we use the term “transformation” so often when talking about digital. And it all starts from the top.

At Imperial Dade, Jason Tillis, our CEO, Charles A. D’Elia Jr., our chief commercial officer, Scott Crocco, our chief financial officer, and our Board members all understand the magnitude of this work and are committed to making it a top strategic imperative. They know that it requires a shift in mindset and a willingness to embrace change. With their support, we are well-positioned to make a lasting impact on the company and our customers.

DC360: How important is it to Imperial Dade’s future to develop a world-class omnichannel experience for your customers?

Saxena: As I mentioned above, it is one of the key strategic imperatives for the company. So, I’d say it is very important.

DC360: What are Imperial Dade’s customers’ biggest demands and expectations — and how can you address them?

Saxena: In my short time at Imperial Dade, I have had the privilege of speaking with many of our customers, and it’s become abundantly clear that they have a deep love and respect for our company. Why? Because we listen to them, and we consistently exceed their expectations.

However, we recognize our digital experience has not kept pace with our customers’ rising expectations  which is why it’s such a priority for us now. Our customers have reasonable expectations — give them digital options for engaging and doing business with Imperial Dade – that are easy, intuitive, and fast. Speed is critical for our customers.

That is exactly what we will do. We will continue to speak to our customers, understand what their journeys are, and where they experience any friction today. As we reimagine our digital experience — including a new ImperialDade.com site and a mobile app, we will constantly seek to remove those friction points for our customers. Furthermore, we want to do the same for our amazing sales team who are out there in the field every day serving our customers. We want to make it easier for each salesperson to serve their customers every day.

We are fully committed to delivering the best possible digital experience for our customers and sales team alike!

DC360: Please comment on how data science powers the omnichannel experience. How difficult is that to accomplish, and what are some of the critical technology systems you’re deploying to support that?

Saxena: In today’s digital age, data-driven decision-making has become a crucial aspect of any successful company’s culture. For Imperial Dade, it is not just a nice-to-have but a fundamental requirement to remain competitive in the market. By utilizing data science, machine learning, and AI, we can take our tribal knowledge and transform it into a culture that prioritizes customer satisfaction and delivers unparalleled value.

As we embark on this journey, we will put the customer at the center of everything we do. Through a data-driven approach, we will gain insights that enable us to anticipate their needs and exceed their expectations. This new way of thinking will become the norm for our teams, ingrained in the fabric of our organization. By doing so, we will improve our ability to serve our customers and create a significant competitive advantage that sets us apart from our peers.

DC360: What about change management? How are you getting Imperial Dade’s internal personnel, suppliers and customers on board with the digital omnichannel commerce experience?

Saxena: This topic of change is absolutely crucial, and it reinforces what we previously discussed about the paramount importance of driving digital transformation from the highest levels of leadership. Most organizations have an inertia to change, and many have designed their current business processes years ago, which can impede progress. To capture a significant portion of the value at stake, everyone must change. Our customers must change (and the good news is many are ready), our salespeople have to change, our marketing people have to change, and over time through this journey every person at Imperial Dade must be prepared to adjust how they work on a daily basis.

With the focus and support of our leaders, my goal will be to build a compelling and concrete reason for why we must change before moving into a tiered and phased approach to bring it to life. In my experience, demonstrating small successes and creating numerous internal advocates for change are critical to our ability to successfully shift. But this is a process that demands continuous and ongoing focus — every day, every week, every month.

DC360: Imperial Dade has made several acquisitions of other distributors. How challenging is it to get then all connected and contributing to the company’s digital and omnichannel growth strategies?

Saxena: Imperial Dade continues to differentiate itself in the marketplace by strategically growing our North American presence through both acquisitions and organic growth. Our approach to digital and omnichannel must complement our growth trajectory, as our expanded footprint better positions us to effectively serve national customers in the U.S. and Canada.

To be successful, we must focus on integrating new businesses as they are acquired, ensure our processes are aligned, and ultimately migrate them to our primary ERP. As we build out our new digital experiences, we will actively work to ensure we build the right architecture to connect effectively into our back-end systems, enabling a single, superior customer experience on the new ImperialDade.com.

DC360: Going forward, what critical steps will Imperial Dade need to take to establish a cohesive coast-to-coast omnichannel business?

Saxena: In my first 90 days at Imperial Dade, my top priority is to kick off the execution of our new digital experiences. This is a crucial step for us, and with only five weeks left as we speak, we must act quickly.

We have already developed and aligned on an omnichannel strategy; we are already engaging with our customers to understand their journeys. We are already assembling the teams we need to kick off execution. A sharp focus on execution will be critical in the early part of our journey, which includes our work on data and business process and engaging our people as part of the journey.

DC360: What excites you the most in new digital commerce technology?

Saxena: AI.

DC360: What do you see as the most significant commerce challenges and opportunities in digital commerce?

Saxena: The problem I see in many companies today is that they continue to view digital commerce simply as a technological upgrade, rather than a fundamental shift in the way businesses create value. This narrow mindset limits their ability to fully leverage the potential of digital technologies to transform their operations, reach new customers, and ultimately drive growth. Companies that succeed in the digital age understand that digital commerce is not just about implementing new technologies but about reimagining their entire business model from the ground up.

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CEO Andy Jassy announced the cuts internally Monday, saying they would occur in the coming weeks and primarily affect Amazon Web Services, human resources, advertising and the Twitch livestreaming service groups.

“Given the uncertain economy in which we reside, and the uncertainty that exists in the near future, we have chosen to be more streamlined in our costs and headcount,” he said in his memo, published later to Amazon’s corporate blog. Twitch’s incoming CEO said in his own blog post that cuts at the San Francisco-based subsidiary would total about 400 people. A spokesperson declined to detail how Amazon was apportioning the rest of the layoffs.

The ecommerce giant has been laying off mostly corporate workers after a hiring spree during the pandemic left Amazon with too many people. The company recently wrapped up a round of job cuts that totaled about 18,000 workers. Those layoffs began in November and landed heaviest on Amazon’s recruiting and human resources teams, its sprawling retail group and devices teams.

Amazon is No. 1 in the 2022 Digital Commerce 360 Top 1000 database. The Top 1000 ranks North American web merchants by sales. It is No. 3 in the Digital Commerce 360 Online Marketplaces database, which ranks the 100 largest global marketplaces.

Amazon layoffs part of larger tech industry trend

The announced cuts come less than a week after Facebook owner Meta Platforms Inc. said it was laying off another 10,000 employees and closing about 5,000 additional open roles in its own second major round of job cuts. Meta CEO Mark Zuckerberg told employees during a recent internal meeting that the economic climate of layoffs and restructuring could last “many years.”

Other tech giants have reduced their headcount, including Google parent company Alphabet Inc., Microsoft Corp., Dell Technologies Inc.,  International Business Machines Corp and eBay Inc.

As of early February, more than 67,000 jobs had been eliminated across the industry since the beginning of the year, according to data compiled by Bloomberg.

It’s a continuation of a worrying trend from 2022, when the tech sector announced 97,171 job cuts, up 649% compared with the previous year, according to consulting firm Challenger, Gray & Christmas Inc.

Employment at Amazon

Amazon employed 1.54 million people worldwide at the end of December. The vast majority of those workers are hourly employees who pack and ship products in warehouses. Before the first round of layoffs began in November, the company said it had roughly 350,000 corporate employees.

The company has periodically worked to rekindle growth in its retail division, but the current slowdown is also hitting AWS, the source of most of Amazon’s profit in recent years. Chief financial officer Brian Olsavsky said he expected slower growth rates for Amazon’s cloud unit “the next few quarters.” Expansion in Amazon’s lucrative advertising business has also slowed.

Jassy said the latest cuts came after teams completed another phase of the company’s annual planning process. He said that for the last several years most of Amazon’s businesses have added significantly to their ranks.

“The overriding tenet of our annual planning this year was to be leaner while doing so in a way that enables us to still invest robustly in the key long-term customer experiences that we believe can meaningfully improve customers’ lives and Amazon as a whole,” he said.

Amazon’s goal is for teams that are on the hook for cuts to determine which positions to eliminate by mid to late April, Jassy said.

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Ecommerce hiring: Jobs are available

For example, there are nearly 3,400 available openings on hiring and job prospect screening website Indeed.com. That total includes 2,810 available positions for ecommerce managers and nearly 500 hiring for ecommerce director.

On LinkedIn, there are even more available openings. A search on the key word “ecommerce director” yields 3,279 results and a similar term on ecommerce vice president returns 50 results.

Outdoor apparel manufacturer The North Face in Denver is seeking a vice president of ecommerce with a hiring base salary range of $235,832 to $353,808. Meanwhile, furniture maker LoveSac in Boston seeks a vice president of ecommerce with a base salary range from $102,000 to $129,000.

Salary ranges for ecommerce directors and vice presidents vary widely depending on experience and job responsibilities. But most jobs have some similar characteristics such as having full profit and loss responsibility. Well-known shoe manufacturer Johnson & Murphy is looking for a new vice president of ecommerce whose duties include owning and managing the forecasting and budgeting of all direct-to-consumer digital activities.

Other responsibilities include managing all aspects of the ecommerce business, such as:

• Business planning
• Content strategy and development
• Website design
• Customer service
• Web analytics
• Consumer analytics
• Marketplaces including Amazon and future channels
• Promotional campaigns and other online marketing
• Web technologies

“Worldwide, new ecommerce businesses are growing daily and hiring managers face global competition for the top candidates with the most experience and skills,” says executive recruiting consulting firm Align. “Ecommerce sales are growing enormously, and businesses are encountering a common problem: they find it difficult to source expert hires with the technical and practical expertise to guide them to ecommerce success.”

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It’s a task that has become more challenging in recent years.

In 2021, in the throes of the COVID-19 pandemic, Bradley decided to replace a legacy digital commerce technology platform with a more flexible, customizable and scalable system running on headless commerce technology. The new platform’s higher level of customization — based partly on the extensive use of application programming interfaces (APIs) to connect the independent, highly customizable customer-facing interface with the ecommerce engine — required a high level of expertise from technology pros accustomed to headless designs.

Ron Flynn, manager, web systems/integrations, Bradley Corp.

But the manufacturer of industrial washroom and safety equipment temporarily lost the availability of some of its IT workers, at a time when it could take three to four months to find the most qualified people to join its digital technology team, says Flynn, who handled the project as Bradley’s manager of web systems/integrations.

Forging ahead with a mixed internal/external staff

Nonetheless, it forged ahead with a mix of internal staff, experts from a third-party consulting firm, and assistance from Amla Commerce, the technology vendor behind Bradley’s new Znode headless commerce platform, he says.

The new platform project moved along without major interruption, bringing Bradley a better technology base for interacting with and managing online commerce with sales reps, distributors and customers, says Dave Leannah, Bradley’s senior vice president of I.T.

But Bradley also used the experience to get better prepared for the next time a major project coincides with unexpected changes in technology staff.

“That kind of opened our eyes a little bit to make sure that we try to stay balanced,” Flynn says, adding, “Today, we’re very well balanced.”

While maintaining strong relationships with its consulting firm and Amla, Bradley has trained more internal staff on the Znode technology, building on the skills many of its tech team brought over from the legacy platform, which also relied on APIs for software integration.

Bradley’s run-in with a changing technology market is not uncommon at a time when many companies are launching, upgrading or expanding their digital commerce technology and ecommerce market presence amid extensive changes in the technology job market. More than 25% of ecommerce companies want to switch ecommerce platforms despite the costs, according to data in the 2023 Ecommerce Platforms Report, which covers the digital commerce technology trends for B2B and retail companies.

Digital technology companies from Amazon.com Inc. and Salesforce Inc. to SAP SE and BigCommerce have slashed their staffs as 2022 turned to 2023, and recruiters who specialized in ecommerce jobs say they’re as busy as ever matching employers with job candidates.

As companies focus on digital, IT salaries rise

Salaries for I.T. executives and technicians, meanwhile, are rising steadily, according to a recent survey from Janco Associates Inc. Average salaries this year are up year over year about 3% to $180,626 for I.T. executives at large enterprises, where I.T. staff salaries are up 5% to $82,636, Janco says. The same positions at mid-size companies rose about 9% to $159,925 and about 7% to  $83,296, respectively.

Business have driven up I.T. salaries as they they’ve increased investment in information technology in recent years, emphasizing ecommerce and mobile computing. And now senior technology executives are stepping up investments as well as online security to guard against cyber attacks and data breaches, Janco says.

The year ahead doesn’t promise to let up on the pressure on the personnel front. Among its Top 10 strategic predictions for 2023 and beyond, technology research and advisory firm Gartner Inc. says that 40% of business organizations will experience a loss of talent in their workforces by 2025 “due to labor volatility.”

Jerry Bernhart, principal, Bernhart Associates Executive Search

Jerry Bernhart, principal and founder of Bernhart Associates Executive Search, specializes in helping employers hire executives to lead ecommerce and I.T. departments. He says he’s seen an increase in demand over the past two years from small- to mid-sized B2B employers — ranging in annual revenue from under $10 million to about $500 million — who are going more digital and need ecommerce business and technology executives who can help a traditional business launch or expand a digital commerce operation.

Cement and chemical companies want digital experts

“A lot of what I’m doing is very transformational in nature,” he says. “I’m getting all these calls from more traditional businesses, a cement company, a chemical company, a company that manufactures food-processing equipment, a pest-control business manufacturer, and now I’m working with a company that provides first responder supplies and equipment.

“Digitization is an important mandate for them, and if they haven’t already moved in that direction, they’re certainly starting to do it now.”

Even with the increase in that activity from employers, however, Bernhart says he now gets about five inquiries from job candidates for every one employer looking to recruit.

Regarding candidates with the most in-demand skills, “the holy grail is a candidate with one bucket in business and the other bucket in technology and data and analytics,” Bernhart says.

Harry Joiner, founder, EcommerceRecruiter.com

Harry Joiner, the founder of EcommerceRecruiter.com, says he seeks candidates who blend those skills and insights, which makes it more likely they’ll grow a client employer’s business with online features and services that make commerce easier and more personalized for customers. Unlike personnel candidates more narrowly focused on either technology or marketing, “they don’t treat customers like an annoyance,” he says.

He adds that, while many online companies fail to offer enough personal service — “in B2B, you can’t get away with that. It’s all about the customer intimacy.”

Joiner notes that his recruiting reputation is built on how he’s brought his client companies ecommerce experts who bring value to their new employer far beyond his recruitment fee of 20% of their first-year base salary. So, he interviews job candidates to grasp the scope of their ability to understand what it takes to grow a business, like increasing customer retention rates.

“That’s what I’m looking for,” he says.

Sifting through a flood of workers

At Bradley, Flynn says his company is positioned well to continue adding features to its Znode headless commerce platform based on an understanding of customers’ needs.

While many experts caution that highly customizable headless platforms can be more laborious to modify compared to a conventional “off-the-shelf” ecommerce software that comes with many pre-built applications, “I would say it’s quite the opposite,” he says. “If you’re going to tailor an application specifically for your business, an out-of-the-box program is not going to work for you.”

Still, finding and hiring people with the right skill sets to maintain effective staffing levels is a crucial task made more challenging by workforce trends. The recent layoffs by large technology companies have thrust tens of thousands into the market, but that flood of candidates can make it more difficult to zero in on the right ones.

“Now we have to be extra diligent to make sure that we’re not getting talent that might not be the level that we require,” Flynn says.

Learn more

Flynn will speak at the EnvisionB2B 2023 Conference & Exhibition on integrating ecommerce technology with enterprise resource planning and product information management Bernhart will speak at the conference on building an B2B ecommerce “dream team.”

The 2023 Ecommerce Platforms Report is available as a downloadable PDF for $399. We also include it in Gold and Platinum memberships, which provide full access to all of Digital Commerce 360’s published reports and certain online retailer databases.

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CEO Andy Jassy announced the cuts, which represent about 1% of Amazon’s employees, in a Jan. 4 memo to staff, saying it followed the company’s annual planning process.

The eliminations began last year and were previously expected to affect about 10,000 people. The move is concentrated in the firm’s corporate ranks, mostly Amazon’s retail division and human resources functions, like recruiting. Eliminating 18,000 workers would be the biggest cut yet for tech companies during the current slowdown, but Amazon also has a far bigger workforce than Silicon Valley peers. It had more than 1.5 million employees as of the end of September.

“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” Jassy said. “These changes will help us pursue our long-term opportunities with a stronger cost structure.”

Amazon is No. 1 in the 2022 Digital Commerce 360 Top 1000 database. The Top 1000 ranks North American web merchants by sales. It is No. 3 in the Digital Commerce 360 Online Marketplaces database, which ranks the 100 largest global marketplaces.

Larger trend of cuts

Though the prospect of layoffs has loomed over Amazon for months the increasing total suggests the company is bracing for a downturn. The company has acknowledged that it hired too many people during the pandemic. It joins other tech giants in making major cuts. Earlier Jan. 4, Salesforce Inc. announced plans to eliminate about 10% of its workforce and reduce its real estate holdings.

At the time the company was planning its cuts in November, a spokesperson said Amazon had roughly 350,000 corporate employees worldwide.

The world’s largest online retailer spent the end of last year adjusting to a sharp slowdown in ecommerce growth as shoppers returned to pre-pandemic habits. Amazon delayed warehouse openings and halted hiring in its retail group. It broadened the freeze to the company’s corporate staff and then began making cuts.

Amazon cuts affect different teams

Jassy has eliminated or curtailed experimental and unprofitable businesses, including teams working on a telehealth service, a delivery robot and a kids’ video-calling device, among other projects.

The Seattle-based company also is trying to align excess capacity with cooling demand. One effort includes trying to sell excess space on its cargo planes, according to people familiar with the matter. Amazon, which began as an online bookstore, is seeing parts of its business level off. But it continues to invest in its cloud-computing and advertising businesses as well as video streaming.

The first wave of cuts landed heaviest on Amazon’s Devices and Services group. That’s the group that builds the Alexa digital assistant and Echo smart speaker, among other products. The group’s chief told Bloomberg last month that layoffs in the unit totaled less than 2,000 people, and that Amazon remained committed to the voice assistant.

Some recruiters and employees in the company’s human resources group were offered buyouts. Jassy told employees in November that more cuts would come in 2023 at its retail and HR teams.

In the Jan. 4 memo, Jassy said the company would provide severance, transitional health benefits and job placement to affected workers. He also chided an employee for leaking the news, an apparent reference to a Wall Street Journal report. The company plans to begin discussing the moves with affected employees on Jan. 18, he said.

“Companies that last a long time go through different phases,” Jassy said. “They’re not in heavy people expansion mode every year.”

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The case, filed in Washington, D.C., Superior Court, cites a 2021 settlement between the company and the Federal Trade Commission, in which the agency found that Amazon withheld tips meant for its gig-economy drivers for more than two years.

Amazon delivery drivers were meant to receive all tips

The mass merchant had pledged that Amazon delivery drivers would receive 100% of the value of tips, but Amazon instead used a portion of the gratuities to pay the base rate for its drivers, the FTC said. The Seattle-based company agreed to pay $61.7 million to settle the matter, which was earmarked for drivers. Amazon spokespeople at the time said the company disagreed that its prior pay practices were unclear.

“My office is suing Amazon for stealing tips from delivery drivers through a deceptive, illegal scheme that made consumers think they were increasing drivers’ pay when Amazon was actually diverting tips to reduce its own labor costs and increase profits,” Washington, D.C., attorney general Karl Racine said in a post on Twitter. Amazon didn’t immediately respond to a request for comment.

Racine seeks restitution, a finding that Amazon’s actions violated consumer protection statutes and civil penalties. Racine’s office had sued Amazon last year, alleging the company engaged in anticompetitive practices that drove up prices for consumers. A judge dismissed the case, saying there wasn’t enough evidence to support the claims. Racine subsequently sought to revive it.

Amazon is No. 1 in the 2022 Digital Commerce 360 Top 1000 database. The Top 1000 ranks North American web merchants by sales. It is No. 3 in the Digital Commerce 360 Online Marketplaces database, which ranks the 100 largest global marketplaces.

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By the end of November, the web-only merchant that specializes in personalized gifts is operating at its peak to create 40,000 personalized ornaments and tens of thousands of other personalized stockings, blankets, mugs, cutting boards, champagne flutes and other gifts per day.

Personalization Mall’s 365,000-square-foot facility in Bolingbrook, Ill.

November and December bring in roughly 35-40% of all Personalization Mall’s annual revenue, says Dan Grebel, vice president of operations at PersonalizationMall.com. The rest of the year, the facility has a 10th of the employees — 400 — who can handle the production volume during the 10-month offseason.

Personalization Mall’s history and business model

Personalization Mall launched in 1998 as an online “mall” where consumers could choose from 20 different items to personalize. Today, the brand offers 2,000 unique “blank items” that shoppers can have personalized with one of 14 different methods, such as laser engraving, embroidery, glass printing, 3D printing, sandblasting and others, plus variations within each method. In total, the merchant now offers 40,000 different product designs, with new designs created each year.

New for this year is an agreement with The Elf on The Shelf. Shoppers can personalize apparel for their elves or purchase personalized items with the The Elf on the Shelf image on it.

Vice president of operations Dan Grebel provides a media tour of Personalization Mall’s production facility.

Bed Bath & Beyond acquired Personalization Mall in 2016 for $190 million. In 2020, the web-only merchant again changed hands and 1-800-Flowers.com (No. 53 in the Digital Commerce 360’s Top 1000 database) bought Personalization Mall for $252 million from Bed Bath & Beyond Inc. (No. 31).

1-800-Flowers.com Inc. owns 17 gifting brands, including Harry & David and Cheryl’s Cookies. The Personalization Mall logo and link to its site is included in the banner of brands that runs across each of these merchants’ websites. The parent company is still working on integrating Personalization Mall’s items into its other brands, such as offering a personalized Easter basket with Harry & David goodies instead.

Personalization Mall’s Bolingbrook, Illinois, facility opened in 2019. It includes a second 100,000-square-foot building for administration and warehousing, giving the online retailer 465,000 square feet of space. This is an 86% increase from its previous facilities that totaled 250,000 square feet.

During a media tour, the merchant showcased its facility as it geared up for Black Friday and the 2022 holiday season, and the process a product goes through from purchase to creation to shipping.

How a blank item becomes personalized at Personalization Mall

After a shopper clicks buy on PersonalizationMall.com, that item is placed in a queue for employees to pick at the warehouse. The warehouse runs four major waves of picks a day, in which employees select all the blank products for the most recent orders. It takes about two hours to pick the roughly 40,000 products in each wave, Grebel says. About 10% of orders during the holiday season have some level of rush shipping, Grebel says. Those orders are picked in smaller waves throughout the day to ensure they are shipping to the customer on time.

Personalization Mall’s warehouse is filled with blank items, which are then picked to be personalized in its attached facility.

Once the items are picked, employees bring them to various areas where they are personalized. Some items, like a name on a stocking, can be personalized right away in the embroidery area. On a screen, the employee can see exactly what the customer saw on her computer screen when she approved the order. When the shopper designed the order on her own computer, she was interacting directly with the software that the machines use, Grebel says. This means the employee doesn’t have to reenter any information, as the software already knows the letters it needs.

The associate then lines up the stocking underneath the machine and hits Enter. The machine gives an estimate of how long the embroidery will take, typically four to six minutes for a stocking, and then goes to work.

Each associate is manning three machines at a time — typically two smaller items, like stockings, and a more time-intensive item, such as a skirt for a Christmas tree, which could take 17 minutes. Each employee typically can embroider 12 to 13 items per hour, Grebel says.

Other items are more complex, such as certain ornaments and personalized blankets that require a two-step process with a heat transfer. About 50% of Personalization Mall’s products require a heat transfer, which is when the image the customer selected is first printed and then transferred onto the item using heat.

Personalization Mall has about 40 printers for this process, all housed in a pressurized part of the facility with temperate and humidity control. Those printers continuously spit out images that are applied to the final product within hours.

Quality assurance for each item is paramount at PersonalizationMall.com

Upon creating an item, employees attach a barcode to it and send the product to quality assurance. Employees scan each item, and an employee compares the final product against the proof image the customer approved on its website to ensure it matches.

“When we’re producing items, we understand that peoples’ expectations with gifting in general is usually a little higher than their own standards because they want to wow their recipient,” says Jeff Chun, vice president of marketing at PersonalizationMall.com.

Not only is the employee checking to make sure the personalization is correct, but also that the presentation looks good and the product is suitable to give as a gift. For example, Personalization Mall will remake an item if it is slightly off center or the product is even slightly damaged, Chun says.

“We view it as much healthier as a business to absorb that and just make a new product that will wow them, than to send something that’s subpar to our customers because long-term, we want those customers to come back, and so we want to present them with the best possible option,” he says.

Repeat orders are a key part of its business, representing roughly 50% of sales, Chun says.

Personalization Mall’s 4,000 employees produce 150,000 items per day during the holiday season.

Associates ship completed items within one to two days. In total, it takes about five business days for the product to be created and then landed on the shopper’s door.

If, for some reason, a product is damaged during transit, the merchant will remake the product.

Because each product is unique to each shopper, customer service is an important part of PersonalizationMall.com. The merchant employs 40 agents year-round, and that swells to about 100 agents during the holiday season. During the holiday season, call volume can be about 400% higher than during the summer.

These agents work in the production facility, so they can walk over to where that consumer’s product is if needed to resolve an issue, Chun says. Shoppers call with questions before, during and after placing an order.

Customer service agents require more training compared with seasonal warehouse workers, Chun says. And so Personalization Mall hires agents in the summer to start training for the holiday season, whereas it onboards the bulk of its seasonal workers in November.

Chun says finding labor has not been an issue for the retailer this year, unlike in 2021, when it was harder to attract good-quality candidates, he says.

2022 holiday season goals for Personalization Mall

With surging sales during 2020 and 2021, Personalization Mall is looking to match 2021’s holiday sales figures for the 2022 season, Chun says.

“The last two years have been exceptional for us,” Chun says. “We’ve had record demand and we’re seeing good engagement with the consumer right now. Our expectation is to be on par with last year.”

PersonalizationMall.com’s online sales grew more than 50% in its 2021 fiscal second quarter ended Dec. 27, 2020, which includes holiday sales during the first year of the pandemic. Plus, it grew sales 4% in its 2022 fiscal second quarter ended Dec. 26, 2021.

Chun says even though the 2022 shopper is dealing with inflation and is being more careful with dollars, the retailer still expects a strong holiday season.

“Even when the customer is a little bit more selective with how they are spending their dollar, personalization is a way where you don’t have to spend a lot to say a lot,” Chun says.

Overall, Chun predicts the sales pattern of the holiday season will look more like pre-pandemic 2019, unlike 2020 and 2021, when shoppers started purchasing much earlier in the season to ensure they could find the items they wanted at a time when supply chain issues prevented retailers from getting all the merchandise they ordered.

While some retailers started promoting the holidays before Halloween, and many released promotions and marketing materials during Amazon’s Early Access Sale Oct. 12-13, Personalization Mall did not see any impact or notable pull forward of holiday sales because of this event, Chun says.

How Personalization Mall views Amazon and its competitors

Plus, as a maker of personalized goods, Personalization Mall is one of the few merchants that doesn’t count the web’s largest merchant — Amazon.com Inc. — as a direct competitor, Chun says.

“Fortunately, personalization is a very specialized industry and so a lot of the big retailers can’t do it and they don’t want to, necessarily, and that’s where our expertise is. That’s where our strengths lie and it’s given us an advantage that we’ve been able to stand out among some of these well-known retailers,” Chun says.

Amazon has not done personalization on a major scale that the retailer is aware of, Chun says.

“We’ve been fortunate to be somewhat insulated from that effect,” he says. “It’s a great boon for the consumer to have a lot of choice in digital shopping, but for retailers, it puts pressure on the retailer for how they can differentiate themselves. But being in personalization, we’ve stood out.”

The retailer does, however, have a number of online competitors that also offer personalized products. They include Shutterfly Inc. and Walgreen Co., which offers personalized stationery and home décor products. Chun says Personalization Mall stands out from them with its large assortment and 14 different ways to personalize products.

Within the Digital Commerce 360 rankings of top online retailers, 260 merchants offer product customization in some way, such as engravings on jewelry, a specific color combination on sneakers or tailored specifications on furniture. But, when looking at retailers that specialized in this area, only six Top 1000 retailers are in the custom merchandise subcategory and only five retailers are in the greeting card category that also offer a number personalized products.

These 11 merchants lag behind the larger Top 1000 merchants, with a collective five-year compound annual growth rate of 8.9% compared with 22.4% for the larger Top 1000. But for 2022, Digital Commerce 360 projects this group to grow 11.5% year over year compared with a projected collective growth of the Top 1000 at 4.2% year over year.

The final few weeks of year are paramount for Personalization Mall. Cyber Monday is the merchant’s top day but its facility will continue to operate all day and night until the final few days of the season.

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The post A peek inside Personalization Mall’s warehouse during peak season appeared first on Digital Commerce 360.