In its second-largest acquisition, Amazon buys the company for $970 million.
The demand for experienced e-commerce professionals outstrips supply, creating a fierce battle for talent.
As the second-largest online retailer in North America, and the biggest among bricks-and-mortar merchants, Staples Inc. wouldn't figure to have much trouble attracting veteran e-commerce executives and technical personnel. But these days, even a retail chain that registered $10.2 billion in 2010 online sales can't be sure it will find all the staffers it needs at a time when so many big retail chains and consumer goods manufacturers are expanding their online operations and looking for experienced personnel.
"There are a finite number of resources in the market," says Brian Tilzer, vice president of e-commerce and business development at the office supplies chain. Staples is among the major retailers with dramatic online growth plans—the retailer aims to triple the size of its e-commerce and information technology staffs for Staples.com within the next two years. "We're looking to invest as big and broadly as anyone," Tilzer says.
And so are other retailers. Many large organizations are building their e-commerce teams, recognizing that the web channel is growing much faster than physical retail stores. In the first two quarters of 2011, online retail grew by more than 17% while total retail sales increased just over 8%, according to the U.S. Department of Commerce.
As a result, despite a 9.1% national unemployment rate, finding talent to fill those newly created positions with experienced e-commerce hands may not be easy for Staples, Tilzer says. The shortage of experienced web professionals may explain in part why Staples had 19,551 job openings in August, according to SimplyHired's "U.S. Employment Outlook: September 2011," which aggregates listings from 30,000 employment web sites. That's up 51.6% from the number of openings the retailer had in August 2010. While a Staples spokesman declines to detail how many of those positions are e-commerce-related, 1,057 of those openings are in the Boston metropolitan area, which includes the retailer's Framingham, Mass., headquarters.
With retailers of all sizes scrambling to replace skilled e-commerce personnel and to find the new hires they need to expand, retailers like Staples are coming up with creative ways to appeal to potential employees and retain their current staff, in many cases turning to current employees for help. "We have to tap into every source we can think of to get the word out about, and to fill, our openings," Tilzer says.
One reason retailers have to get creative is because the differences in salary between retailers of similar sizes are minor, says Christian Ricci, vice president of technology at e-commerce software provider Rangespan Ltd., who until July had held multiple hiring-level positions at Amazon.com Inc., including senior technical architect and development manager for Kindle. Offering employees the ability to develop a new marketing tool or to explore an emerging channel like social media is part of the appeal of a start-up like Rangespan, which offers retailers technology such as order management systems, he says.
Many large online retailers are also providing employees with opportunities for growth, both to challenge them and to send a message that staffers don't have to leave the company to pursue a new interest, Ricci says. He points to his former employer, Amazon, as a prime example.
Even though Amazon is a massive corporation, it gives employees opportunities to self-direct and explore their interests, he says. "At Amazon, if given an opportunity to buy something or build it, Amazon is more likely to build it," Ricci says. Part of the reason Amazon takes that approach is the retailer's massive scale. But it's also because it has employees who are capable of, and eager to, invent and develop new initiatives, he adds. "That's why Amazon feels like dozens or hundreds of start-ups."
Providing growth opportunities for employees is one way Staples is seeking to appeal to potential employees as it attempts to rapidly add to its web staff. When recruiting employees the retailer highlights its large size, which affords employees with plenty of opportunities to advance within the organization, Tilzer says. And because the retailer has pockets large enough to invest heavily in technology, employees can use those opportunities to expand their skills, he adds.
"The pace of change has never been faster," Tilzer says. "We have a constant, accelerating stream of projects as we move into new areas." For instance, when the retailer decided to develop its mobile commerce site, which launched in June, it first reached out to current employees to see who would like to work and experiment in the rapidly growing mobile channel.
Electronics e-retailer Newegg Inc. is embarking on a similar, but more formalized process to keep employees on an upward track throughout the organization, says Lee Cheng, the retailer's vice president of human resources. The initiative, which Cheng launched in June, regularly identifies internal candidates who can fill nearly every role in the company—from the CEO on down—in the event the staff member leaves his position. For senior- and executive-level positions the retailer also identifies external candidates who can fill those positions.
Newegg is reacting to the shortage in available e-commerce talent: The e-retailer only has been able to fill 40 of the 90 new staff positions it created in the past year. "We want to make sure that we have our critical positions well covered by the best talent we can find," Cheng says.
The program also ensures the retailer is regularly developing and promoting its talented staff members by offering special training, such as Chinese language lessons that aid employees' ability to communicate with their Chinese colleagues, to encourage them to stay. That's increasingly important because Newegg faces competitors seeking to poach its workers, Cheng says. "People finally get it that selling online has to be a part of any retailer's success," he adds. "That's creating a fierce battle for talent."