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Due to the managerial tensions that were commonplace at Etsy by 2017 and the added pressure by investors after the 2015 IPO to raise profits, the culture abruptly changed. Close to 80 people were fired just before Mr. Silverman was appointed, followed by another 140 people soon after his tenure began. Moreover, multiple ongoing projects were shut, along with the Good Work Institute, Etsy’s very own charitable organization started in 2015 and Etsy Studio, a marketplace solely for arts and crafts supplies. ORGANIZATIONAL DESIGN Etsy’s new CEO Josh Silverman explained to Fortuneexclusively that these recent organisational changes are about realigning resources around the ‘fewest, most impactful areas where we need to succeed’ with a cleaner organizational structure, less bureaucracy, and more focus on growth. (King, 2017). In 2017, Etsy reorganised its workforce, which included a reduction of 15% of the employees in the company. The figure that follows presents the recently-updated organization structure.
of 916The reduction was made in the middle management and senior management roles in which product management, marketing and administrative roles were affected. Etsy is a comparatively new e-commerce website and is slowly trying to incorporate all of the e-commerce features of the big players like Amazon and Shopify. Therefore, in 2019, they made several changes to the Etsy marketplace — they changed the look and feel of the interface from an e-mail-like platform to a chat-like experience which enabled faster interactions which are more focused on shopping. It helped in bringing out quality of interactions with the buyers and helped in differentiating Etsy from the other e-commerce platforms. In addition, they are also focusing on broadening their marketing channels and investing in performance marketing channels such as product listings ads on Google or search engine marketing. Recently, Etsy also started their own e-commerce platform called the Etsy Pattern, which is similar to Shopify, where one can build their own website. It is separate from Etsy Marketplace; therefore, the website owner has to bring their own online traffic. (Carney, 2020) CHALLENGES In an effort to grow rapidly, Etsy has strayed away from its initial goal — to support and nurture small and local businesses. In order to keep up with e-commerce giants such as Amazon, Walmart and eBay, Etsy has had to make multiple changes to its policy for sellers and not all of them were favoured by those who rely on the platform to reach their buyers. Given the slump that the company was going though post its IPO offering, Etsy Organizational Structure Source: Etsy Annual Report, 2019
of 1016the newly appointed CEO, Josh Silverman, was quick to make drastic changes in order to increase the company’s profits and increase the speed of growth. 1.Unwelcome changes to company policy.