E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Experienced professionals or talented newcomers in search marketing, web development and computer programming are in high demand.
Retailers know how to scramble when the demand for a hot product exceeds the supply. These days personnel managers are hustling to find the scarce commodity they need: specialized e-commerce employees. In the early days of business-to-consumer e-commerce, many companies made recruiting a seasoned business leader their top hiring priority. But the job market is shifting. Today experienced professionals or talented newcomers that can be trained and put to work as search engine marketing specialists, web developers and computer programmers are the employees retailers most want to hire.
Retailers are offering higher pay and better perks to entice qualified candidates and to keep their existing employees motivated and on the job. Companies are also mixing and matching their recruiting strategies and scouring new Internet venues such as social networks to find specialized e-commerce workers. These are the main conclusions of Internet Retailer’s latest monthly survey, this one on salaries and personnel management.
With the web retailing market growing at an annual rate of 17%, retailers are actively looking for experienced specialists or well-rounded candidates who can be trained and put to work operating bid management systems, interpreting web analytics reports or writing new code. For example, the survey finds that 36.1% of companies list web developers as their top hiring priority, followed by search engine marketing specialists at 29.4%, marketing specialists at 29%, e-commerce merchandise planners and buyers at 19.8% and computer programmers or other information technology specialists at 19.4%.
In contrast, only 3.2% of retailers rank a new e-commerce business leader as their highest personnel priority and only 7.9% say a new vice president or director of interactive marketing is their most immediate hiring need. “Internet retailing is an established industry and many companies now have an experienced management team that has been on the job for several years,” says Gene Manheim, managing director and chief e-commerce and Internet recruiter at Herbert Mines Associates, a New York retained-search firm. “One of the biggest personnel challenges retailers face these days is finding enough skilled specialists to execute the business plan.”
To find more qualified specialists, web retailers are paying higher starting salaries for entry level employees. Compared to one year ago, 60.6% of retailers are paying their workers higher salaries, including 9.8% much higher compensation. The survey, which summarized answers from 110 virtual merchants, 73 chain retailers, 52 catalog companies and 42 consumer brand manufacturers, finds that 42.7% of online merchants will pay a starting salary of $40,000 and up for an entry-level online marketing position, compared with 33.5% of merchants taking part in a similar Internet Retailer survey a year ago.
The starting salary for other specialists is also climbing with 41.3% of companies now paying their junior web developers and programming specialists a base salary of at least $50,000 per year, including 15.9% more than $60,000. But even higher salaries can’t always speed up the hiring process or help retailers find all the specialists they need. It still takes 71.7% of retailers three months or longer to fill an opening, including 6.1% more than nine months. 66.8% of companies also describe the current market for attracting employees as difficult and 11.7% as very difficult.
“It remains a seller’s market for technical and marketing specialists with the right combination of skill and experience,” Manheim says. “A highly qualified candidate can still expect to review multiple offers.”
Most retailers are using conventional recruiting strategies to attract job applicants. For example, 68.7% of retailers in the survey use online job boards as their main tool to find employees, followed by employee referrals at 57.5%, online classifieds at 43.3%, college recruiting at 27%, newspaper advertising at 25%, job fairs at 15.1% and industry trade shows at 11.5%.
But to find all of the available workers they need, more retailers are also taking advantage of social networks to post jobs. Of the 277 retailers taking part in the Internet Retailer survey, more than a fifth-21.8%-use major social networks such as Facebook.com and MySpace.com or more specialized sites, including LinkedIn.com and AdTech.com, to identify potential employees. Once they are on a social network site, personnel managers can use various keywords to screen for candidates with a specific background.
Retailers also ask employees to update their own blogs or contact peers about a current job opening. “Social networks weren’t even around as a serious recruiting tool just a few years ago and now companies like ours and retail personnel managers are using them to find qualified applicants quickly and efficiently,” says Jamie Mitchell, executive recruiter, Internet marketing for Mangieri/Hull Solutions, a Sandy Hook, Conn., executive recruiting firm.
Social networks are helping retailers build a bigger pool of applicants, but in a tight job market retailers are also touting their stable management, tight-knit working groups and flexible benefits as other positive factors in finding and hiring qualified employees. The survey was e-mailed in early March to all subscribers of IRNewsLink, the magazine’s e-newsletter, and all responses were collected and analyzed by Vovici Corp., which has partnered with Internet Retailer in a series of surveys of the e-retailing industry.
The research finds that 66.7% operate a small e-commerce department with 10 or fewer employees. Most web retailing organizations also have experienced management in place, with 54.9% of top web and interactive marketing executives on the job for at least three years and 7.3% for more than a decade.
“In a tight market, more retailers are stressing their tight knit and steady e-commerce environment in a way that tells a good applicant ‘Your skills will be appreciated here and we value a long-term relationship,’” says Harry Joiner, president of EcommerceRecruiter.com, a web retailing search firm based in Roswell, Ga. “A work environment where the web business is established and growing tells candidates they can expect to be employed in a very stable environment.”