Building a High-Performance ecommerce Organization. How to resource and staff for ecommerce success

Transcription

1 Building a High-Performance ecommerce Organization How to resource and staff for ecommerce success

2 What you ll learn: The importance of culture and C-level buy-in in organizational success Where ecommerce should report What makes a successful digital commerce leader How to determine, allocate and grow dedicated headcount Balancing in-sourcing versus outsourcing to brokers, agencies and consultants Critical workstreams, and common roles and responsibilities needed to succeed While hard to imagine nowadays, it wasn t too long ago when companies had nobody dedicated to ecommerce. This was pretty much the case across the CPG industry. In fact, if you were working on ecommerce at all, you were designated responsibility for it typically alongside other channels. The title of VP or Director of alternative channels was not uncommon 10 years ago. This role covered a mix of small and emerging channels such as club stores, discounters, military and ecommerce sectors that really didn t fit anywhere else or fit the mold of traditional retail models. It s funny when you think about the complexity and nuances of these four wildly different channels lumped under the guise of alternative. Just consider how different the skill set and path to success is for ecommerce versus something like military, or even club or discount. Yet that was the level of attention and focus these channels were given back then. The result: very little potential was realized. We ve come a long way as an industry from fundamentally one person supporting the entire ecommerce channel as a quarter of their time to companies now having dedicated teams of highly specialized people working on a full-time basis. There s been an incredible evolution in terms of ecommerce specialization and dedication in a few short years. Still, these dedicated ecommerce specialists are supporting only a fraction of what actually needs to be done. The industry continues to grapple with questions about how to participate in and organize around ecommerce, particularly without sacrificing company heritage or culture. Many of these issues are addressed in this paper, with Profitero providing some guidelines and benchmarks based on our research. However, some organizational issues remain a work in process. They ll continue to evolve over time as ecommerce grows and digital becomes more pervasive. 2

3 Prerequisites for ecommerce success There are of course some burning organizational questions on nearly everyone s mind: How big is the typical ecommerce team? Where does it report? How is it structured globally? What activities are in-sourced versus outsourced? How many people are out in the field? But none of that matters if some pre-conditions to doing ecommerce aren t met that is, having the intangibles or prerequisites for ecommerce success right in the first place. These include: The digitization of the whole [shopping] experience is ongoing and permanent and we need to participate in that. James Quincey CEO, The Coca-Cola Company Source: 2018 CAGNY conference 1 C-level and board support. There continues to be skepticism and internal resistance about ecommerce inside many companies. Without executive support and acknowledgment of digital as a strategic priority, efforts could be dead in the water before they start. Therefore, it s important that the top brass explicitly states from the get-go that the company is doing ecommerce and going to do it well. More and more, we see CEOs becoming outspoken advocates and champions of ecommerce. 2 Expectation that everyone in the organization will have some accountability. Without a doubt, all disciplines and functions will be impacted and involved in the transition to ecommerce in some capacity. Digital is not something that just sits adjacent to what the business already does. Consequently, it s vital to create awareness throughout the ranks and invest in cross-functional training and development to (at the very least) establish a baseline vocabulary and communicate the basic concepts. Ensuring everyone has a vested interest in seeing ecommerce succeed rather than viewing it as internal competition or cannibalization is critical. 3 Acknowledged need for new specialization. This means a dedicated and skilled professional focus by management is necessary to ensure activities critical to ecommerce success aren t slipping through the cracks. Optimizing search placement on retailers sites, developing and managing digital product content, and analyzing channel performance and profitability are among the roles and responsibilities that need to be covered. 4 Understanding that ecommerce success follows a different path, and a rather unfamiliar one at that. It s important that companies be comfortable operating with a certain level of ambiguity. This is because ecommerce success can t be measured purely based on existing metrics or traditional criteria. Instead, high-performing organizations give ecommerce teams a bit of latitude because their goals, definition of success and pathway is usually different than that of mature channels. 3

4 We re up 82% so far in ecommerce in the US in the first half [of the year], and we re taking our capabilites global. Even though it s dynamic and there is a lot change [in ecommerce]... that change is opportunity for those who are willing to take it. Jeff Harmening CEO, General Mills Source: 2018 CAGNY conference

5 Organizing around ecommerce There is no single universal and overarching answer for how to organize around ecommerce. This paper presents some guidelines, based in part on the findings from Profitero s survey of 134 brands around the globe, proprietary research of LinkedIn professional profiles and job postings, and an analysis which ties sales performance to team structure. The good news is that it s still early innings of developing ecommerce organizations. This is especially true for many smaller and mid-sized brands. Our research shows a notable divergence in the level of sophistication between large and small companies: 54% of smaller CPGs (defined as < $500M in sales) self-identified as novices or amateurs really just starting down the path of organizing around ecommerce. The level of sophistication increases, however, with company size. A higher share (44%) of large CPGs ($500M+) relative to smaller companies self-identify as advanced. Still, a fairly substantial 42% of large CPGs self-report as novices or amateurs. Maturity level of brand manufacturers in organizing around ecommerce, 2017 Source: Profitero survey. Scope: Global 16% Novice 30% We are just beginning to organize around ecommerce 26% 24% We are engaging retailers in joint business planning that includes ecommerce 44% 28% All of the above, plus dedicated ecommerce resources 7% All of the above, plus clear objectives for ecommerce as a distribution & marketing channel All of the above, plus we believe we set the digital standard among our peers/competitors Larger than $500M Smaller than $500M / Not publicly available 3% 3% 0% Amateur Advanced Expert Leader Don t know / Regardless of company size, a very small percentage of the industry considers themselves experts or leaders. The opportunity clearly exists to mold your teams and organizations as a whole for high performance. Consider it an ongoing quest as ecommerce sales grow and the channel matures. 10% 8% prefer not to answer 5

6 Where ecommerce reports There is no single right answer for where ecommerce should report. It depends on your company s strategic objectives and priorities for the channel, as well as company culture. Our data shows that ecommerce most typically reports into Sales: This was the case for about 75% of the CPG companies we surveyed. The other 25% of companies have it reporting into Marketing. So, if the question is: Where does it report? The answer is: Sales. But if the question is: Where should it report? Then it all depends on a company s culture and defining objectives up front. An argument certainly can be made for reporting into either Sales or Marketing: Reporting into Sales. If your objective is primarily to generate volume, gain market share, and get ecommerce on a path to profitability, then it should report into Sales. Sales will give disproportionate weight to commercial decisions about distribution, pricing, promotion and supply chain. The main drawback here is that you risk being under-resourced on the basis of overall channel volume (typically quite small as a proportion of total company sales) or the channel s profitability (or lack thereof). Reporting into Marketing. If the company s priority is building or protecting brand equity or driving awareness and influence, then Marketing might be the best place for ecommerce to report. This will allow for synergies to be drawn with other marketing disciplines, particularly in areas like digital display advertising, search optimization and content marketing. Drawbacks however include potentially under-emphasizing the significance of supply chain, stock availability, pricing and promotion. An increasingly common approach is aligning Sales and Marketing by establishing a dotted-line reporting relationship between ecommerce and the function to which it does not directly report. That is, if ecommerce reports to Sales, establish a dottedline to Marketing. Likewise, when reporting into Marketing, have a dotted-line to Sales. 6

7 Balancing global & local market considerations Managing global aspirations while accounting for local considerations is often a balancing act for large multinational brands. Wildly divergent ecommerce market dynamics in different parts of the world e.g., in China vs. the US vs. the UK underscores the importance of balancing global with local online initiatives. Most successful companies start by appointing an executive who sets and oversees global strategy, organization design and capability deployment. And they deploy an operating model or framework that allows for a certain degree of freedom and localization based on market needs. This way, rather than steamrolling regional or country teams, local nuances are considered. Some key objectives to this type of balanced approach: It enables management to focus on global objectives or leading practices, e.g., how to present the brand globally or manage factors that are known to drive performance. Yet it still provides regional teams the latitude to apply their judgment of what s applicable at the local level. It also enables local market teams to learn and discover things that can then be shared back to management and the broader organization. Companies that figure out this balancing act giving their highest-potential regions autonomy and support to lead in their respective markets operate as highperformance ecommerce organizations. 7

8 Profile of a successful ecommerce leader ecommerce impacts every part of the organization and if left to their own way, each function will attack it from their own narrow view. As such, many companies are recognizing they need an ecommerce czar i.e., someone to pull all the pieces together and champion a holistic effort to capitalize on this once-in-a-lifetime business model shift. Based on our LinkedIn research of more than 100 CPG companies with sales of at least $65 million, 81% now have a Head of ecommerce (VP or Director). Blue chip consultant à la McKinsey or BCG, complete with an MBA from a highly regarded institution (e.g., Harvard, Wharton, et.al.). Somebody who s led ecommerce initiatives in a category that s more mature, like toys or electronics. Increasingly, gravitas and credibility inside the company s four walls is an essential prerequisite for the oft-needed internal selling and consensusbuilding, that is, moving the organization from the status quo to where you want to take the company. While any of the aforementioned profiles can prove successful, domain experience (i.e., CPG know-how) coupled with a passion for innovation, improving the customer experience and forging retailer partnerships could be a winning formula. As companies begin to prioritize ecommerce and dedicate budget to hiring, different profiles of candidates to lead the initiative often emerge: Experienced leader with deep industry knowledge, often someone who has come up through the ranks in disciplines such as sales or shopper marketing, but now needs to learn ecommerce on the job. ecommerce/digital/social native (i.e., often from one of the FANG companies: Facebook, Amazon, Netflix, Google), someone who doesn t necessarily have industry knowledge, but has a deep understanding of technology and ecommerce. Sample job description template ecommerce Lead Establish corporate ecommerce channel Identify, select and deploy tools, strategy for assigned region/business technologies and capabilities that unit/category enable performance Build and manage a high-performance Develop commercial playbooks for team, including direct reports and ecommerce in areas including search, indirect reports embedded on account or product content, promotions, and more other teams Sales and P&L responsibility for pure-play ecommerce retailers 8

9 Let me guess? Resources in your organization are constrained. No matter their commitment level to ecommerce as a strategic priority, all organizations are selective by necessity about where and how to allocate people and funds. To succeed, though, your ecommerce staffing model cannot be a static one albeit when first starting off, it could be small. It must be dynamic and fluid, and expected to evolve over time, dictated by volume growth and channel maturity. Keith Anderson SVP Strategy & Insights, Profitero PRODUCT CONTENT: PACKAGING FOR THE DIGITAL SHELF 9

10 Dedicated versus designated resources For many organizations, developing the right staffing model can be tricky. In best case scenarios, some will fully dedicate staff to ecommerce roles where that is their job s sole focus, while others may opt for the least ideal scenario and not have anyone focused on ecommerce at all. But, what about the next best thing? In other words, when companies choose to designate someone to focus on ecommerce in addition to their other priorities. Let s take a closer look at what this means and the implications. Best Case Scenario: Dedicate Resources. In a world without limits, organizations would dedicate full-time associates to manage not only the fundamentals of showing up on the digital shelf but all the value-added work to optimize performance as well. All countries, retailers, categories and brands would be resourced according to their needs, without constraint. The value of dedicated staff is self-evident. Without distractions, dedicated staff has a singular focus on a narrow set of well-defined objectives and goals. They re able to develop specialized expertise and skills, and then bring them to bear on a proportionally-scoped stream of work that drives results. Next Best Scenario: Designate Resources. As a form of compromise, organizations that want to devote some focus to ecommerce but can t yet justify the funds to dedicate the desired level of support often designate staff as responsible for ecommerce in addition to other primary responsibilities. This approach is most common at the account level, particularly for omnichannel retailers that already have a dedicated account team in place. The problem is that designated staff often struggle with responsibilities that exceed their knowledge, skills or resources. Unless digital is central to an individual s or team s KPIs, it tends to become an afterthought. So, if you re going to commit to supporting retailers other than Amazon, you have to make sure you have the right staffing model to do it. If you re going to commit to supporting retailers other than Amazon, you have to make sure you have the right staffing model to do it. You have to at least designate somebody to each account or do what many companies have done: dedicate somebody to support all other brick-andmortar dotcoms. You have to at least designate somebody to each account or do what many companies have done: dedicate somebody to support all other brickand-mortar dotcoms. That simply means rather than making digital 20% of one person s job at each of five customer accounts, make supporting five retailers 100% of one person s job. This is the MO of most successful companies. 10

11 Adding dedicated support as volume grows As in all other areas of business, the expectation is that you ll add dedicated staff and other resources to your ecommerce roster as the channel matures and volume grows, or while you prioritize making it grow. We find that there is a predictable trajectory in building out account teams. The staffing model typically progresses from a single person responsible for everything to a multi-person team assigned by retail customer or dedicated to specific functions. Amazon account teams as industry benchmark: Example of fully built-out dedicated support structure Associate Marketing Director ecommerce & Shopper Marketing 15 yrs exp. 1 yr in ecommerce ecommerce Brand Manager Amazon Shopper Marketing Team 7 yrs exp. 1 yr in ecommerce Amazon Media SME 10 yrs exp. 2 yrs in ecommerce ecommerce Sales Manager Amazon 15 yrs exp. 10 yrs in ecommerce Regional Sales Manager Strategic ecommerce 7 yrs exp. 3 yrs in ecommerce Sales Analyst ecommerce / Amazon Team 1 yr exp. 1 yr in ecommerce National Account Manager Amazon 6 yrs exp. 3 yrs in ecommerce 11

12 Dedicated leads by retailer In the US, Amazon teams are often held as the industry benchmark, both in terms of organizational structure and dedicated resources. Therefore, it should come as no surprise that many CPGs have full teams dedicated to Amazon. We found that 58% of the brands we surveyed in 2017 has a dedicated account lead for Amazon. This is up from 47% a year earlier. In comparison, 28% of brands had a dedicated Walmart.com lead, while just 17% had one dedicated to Target.com. We expect these figures to substantially increase in the coming years given the retailers aggressive ecommerce growth plans. Percent of CPG survey participants with a dedicated dotcom(s) lead Source: Profitero survey. Scope: Global +11 PP 58% 47% +2 PP 26% 28% PP 18% 17% Amazon Walmart Target 12

13 Headquarters versus field allocation Beginning around 1990, just a few years after Walmart launched its supercenter format, and began accelerating growth and share gain in the US retail landscape, the supplier community realized there was value in co-locating account teams that support the customer. In the fishbowl that is Northwest Arkansas, suppliers with feet on the ground and a first-to-learn potential strengthened their relationships with Walmart buyers, divisional merchandise managers and other members of the brass. They demonstrated commitment to supporting the retailer in ways that transcended their narrow portfolio of brands and even the categories in which they participated. They committed to the success of Walmart as a strategic partner. Now, as Amazon continues its ascent as the pre-eminent online retailer on the global stage, manufacturers increasingly question whether a model of co-location can yield similar benefits in the way they work with Amazon. A 2015 McKinsey survey found that 80% of winning companies co-locate with Amazon in Seattle or plan to do so within two years, compared with 14% of non-winners. It seems that reality may not have caught up to plans just yet, however. Based on our February 2017 analysis of LinkedIn profiles of 115 manufacturer ecommerce teams, most account managers continue to work out of their headquarters location. We found less than a third (30%) actually work in the field. Of those in the field, Account management HQ vs field Source: Profitero s LinkedIn analysis. Scope: Global HQ vs field HQ Field 30% 70% Retailers Amazon Walmart Other 18% 10% 72% 18% were associated with Amazon. Perhaps worth noting is that Amazon actually disincentivizes its Vendor Managers from manually intervening in many decisions (as well as having other liaisons with suppliers). So why then do we find such a large contingent of Account Managers in Seattle? Anecdotally, we hear that while Amazon is a platform better managed through algorithms and automation than through relationship-building simply being close to the action immerses Amazon 70% of Account Managers work at HQ; 30% work in the field. 18% of Account Managers who work in the field are associated with Amazon; 10% are associated with Walmart. account teams in the day-to-day developments of the fast-changing retailer. The benefit is through sheer proximity to the ecosystem of companies doing business with Amazon than Amazon itself, you hear sooner than others about developments or initiatives in the pipeline. Co-locating in Seattle also helps build a network of industry peers doing similar work, facing similar challenges and pursuing similar opportunities. 13

14 In-sourcing versus outsourcing Working with consultants, brokers and agencies can be an effective way to accelerate performance, particularly before an in-house team can be fully built. It can also help an organization develop and maintain institutional competency and knowledge. So the question becomes: What kind of work or functions should be developed internally versus outsourced? We encourage companies to in-source whatever they view as strategic. That is, when a compelling rationale can be drawn for hiring proven talent in-house for work that could yield a competitive advantage. After all, if you re renting the same team as industry peers, the probability is low that you re uniquely outperforming. That said, depending on your maturity level, budget and approach to hiring, outsourcing can be a good alternative. However, it s important to understand when it makes sense to outsource and how to get the most out of your outsourcing relationships. For example: Differentiate work outsourced for effectiveness versus efficiency. Hiring a consultant or agency that has unique and specialized knowledge or capabilities can create significant value by compressing the learning curve or producing exceptional work that couldn t be done inhouse. But don t confuse expediency with expertise. When you want or need to learn from partners. If you choose to outsource some functions or tasks, by all means be sure to gain as much knowledge as possible from the experts. In other words, drain their brains. Don t just get the result from them. Learn as much as you can about how they produced the result so you re ready when it s time to bring the work inhouse. Functions commonly outsourced to agencies or brokers: Marketing Sales / Distribution Digital merchandiser Search Content analyst 14

15 Defining ecommerce roles, adding headcount Some roles related to ecommerce are emerging that many executives may not have heard of before. But these roles are increasingly essential not only to conducting business but winning in ecommerce. Emerging roles, and related responsibilities, that should be on your radar include: Data Analytics. Analytics are a big deal in any distribution channel, but especially in ecommerce. As with content, more companies are dedicating people to analyzing sales and other data, either at the account level, or by category or brand. Using vast data sets, dashboards and benchmarking, they re responsible for identifying trends, issues and opportunities. They provide insights and recommendations to marketing, sales and other teams on actions needed to drive traffic, conversion and ultimately sales. Content & Digital Merchandising. Your product content is your packaging on the digital shelf. Digital content e.g., images, titles, descriptions, feature bullets, videos, among others is not only important to how your brand turns up in search results but also impacts conversion rate. Imagine the complexity involved in managing a product content portfolio for hundreds of SKUs that are changing over maybe once a year as you update physical packaging, launch new items or retire old ones. Multiply that by the number of online retailers you do or want to do business with, and it becomes evident that this is a lot of complex work. Content & Digital Merchandisers ensure this work not only gets done but is executed excellently. They re responsible for addressing and fixing digital content problems often found at the brand, category or account level. Given nuances from one retailer to the next, they tend to be aligned with a specific account. Supply Chain, Logistics and Customer Service. These areas are not yet as widespread as Analytics and Content roles, but are of growing importance. Take for example, the role of R&D manager. Among their responsibilities: Optimizing price pack architecture and new product development for the ecommerce channel, and perhaps even specifically for Amazon. As in other retail channels, a lot of collaborative forecasting and replenishment work is required to ensure on-shelf availability is maximized and that the right supply is delivered on schedule to minimize deductions and other supply chain issues. Managing online stock levels and avoiding out-of-stocks is a particular concern. With a mere click, shoppers can easily defect to a competitor s brand. On Amazon, brands must also be concerned about losing the buy box to third-party sellers and potential delisting due to lack of product availability. 15

16 Examples: ecommerce roles & job descriptions Data analytics ecommerce & Category Business Analyst, RB Key responsibilities: Analyzing and identifying trends across Amazon.com and Jet.com by providing insight and recommendations to drive traffic Producing regular reporting to track sales and deliver revenue targets Working closely with the Marketing Department to run sales-driven promotions, advertisements, coupons and campaigns Providing guidance and support to Sales team on use and interpretation of syndicated data, such as Nielsen Answers On Demand and IRI Liquid Data platform Partnering with Trade Marketing and Brand Marketing with regard to customer insights presentations for the Field Sales team Demand and ecommerce Analyst, Mars Key responsibilities: Demand Analyst Demand and trade forecasting for UK chocolate, highlighting key trends, risks and opportunities Reporting and analysis of demand performance Providing transparency and insights into business performance Quarterly innovation review to ensure pipeline fill for growth targets ecommerce Analyst Business partner of ecommerce channel Performance analyses, identifying risks and opportunties, giving insights into forecast implications Challenging and steering to drive the delivery of channel targets 16

17 Examples: ecommerce roles & job descriptions cont d Content & digital merchandising Digital Merchandiser, Click & Mortar Key responsibilities: Primary responsibility is enabling perfect page: securing all aspects of target digital assets and product information in a consumer relevant way to drive conversion with our brands. Work with ecom or Click & Mortar Account Manager to define current and future customer portfolio, ensure content is available on a timely basis and is proactive against the upcoming customer econtent needs. Benchmark and assess our and competition execution online through qualitative and quantitative data points: content quality, integrity, availability, placement. Utilize Profitero as a diagnostic and insight-driving tool. Work with ecom Content Manager to ensure most updated best practices are shared and updated in customer s sites. Monitor and anticipate new emerchandising trends and winning tactics, partnering with the customer team, CMI and the retailer. Consistently provide ideas on how we can influence and how we can provide great new experiences to the eretailer digital shelf. Maintain an active awareness on industry trends and best practices. Work with key stakeholders to define and implement improvement strategies, projects and tests. Define and continuously measure KPIs to assess retailer emerchandising strategies and execution capabilities. Europe, Middle East, North Africa (EMENA) econtent Digital Lead Key responsibilities: Develop and lead econtent Brand Acceleration program for EMENA Lead the deployment of the E2E econtent Operational Model in a holistic manner across EMENA based on 6 key principles Lead the econtent infrastructure deployment (DAM, PIM) and ensure direct management of the DAM at EMENA level Define econtent masterplan together with the EMENA generating demand teams and define subsequent initiatives related to it (Gap analysis, Brand playbook planning, etc.) Lead a team of econtent expert (1) DAM Librarian (2) econtent Project Manager, recognized as Subject Matter Experts within EMENA and Nestle Setting and monitoring performance (content compliance % reporting) Manage the relationship with PetCare SBU/Market, econtent Global Center of Expertise ensuring EMENA deploy latest best practices on econtent Build and consolidate market learnings to share with global, regional and local digital marketing / ebusiness teams Training and enabling the regional Brand teams on ecommerce content requirements 17

18 Examples: ecommerce roles & job descriptions cont d Supply chain, logistics & customer service ecommerce Supply Chain Manager, PepsiCo Key responsibilities: Managing the operational customer relationship with top national ecommerce partners while integrating their distribution network across our great, North American Nutrition portfolio. In a warehouse-delivered environment we are making brands like Quaker, Gatorade, IZZE, Naked Juice and Tropicana available to consumers across the country at the click of a button. Winning in the national supplier of the ecommerce space for best-in-class service and SKU assortment Defining the strategic sourcing for best-in-class customer execution for all of the Amazon banners (.com/pantry/fresh/prime Now), Boxed.com, Walmart.com, Jet.com, Gatorade.com, Vitacost.com and Fresh Direct Integrating Walmart.com and Jet.com into the PepsiCo distribution network as they look to expand their online presence Driving business metrics by bringing together key stakeholders, executing process and guiding decision-making with data Customer Supply Chain Rep Digital Commerce, Mars Key responsibilities: Constructively challenge internal order to cash processes and requirements to achieve satisfactory service for high priority Digital Commerce customers. Investigate new delivery options for low weight orders with short lead times to serve new Digital Commerce needs. Analyze Amazon fines and fees to identify necessary project work streams to be undertaken, and provide suggestions to Supply Chain Managers, EDI Managers and Regional Distribution Managers. Amazon fines and fees have been reduced from averaging over $9,000/month in the last year to under $1,000 in the last month. Manage customer relationship, order fill rate and vendor lead time for 11 Digital Commerce customers including Amazon and Walmart.com. Adopted additional Grocery and Specialty customers to fill the open needs of the business. Collaborate with Account Managers and Sales Analysts to create a bridge between Sales and Supply, ensuring that our business is prepared internally for rapidly changing customer requests and requirements. Designed automated Excel-based Amazon tracker, organizing large amounts of data in an easily navigated format, reducing non value-added time spent managing data. This created an automated process to manage orders, item details, case fill cuts, order lead time and GSV. Influenced internal financial stakeholders to increase Amazon s credit limit to reduce vendor lead time, improving service for a high-priority customer. Partner with Wrigley counterparts to identify and discuss Digital Commerce challenges, and develop cross-segmental solutions. 18

19 Determining headcount needs On top of understanding new roles, most executives struggle with how many people are necessary to successfully perform in the channel. It could be helpful to benchmark against some industry standards. For example, Profitero s analysis of Amazondedicated headcount by company size could serve as a guide to understanding the number and types of roles to consider adding as you elevate ecommerce within the organization. Amazon-dedicated headcount in CPG companies CPG company s annual Amazon sales Average Amazon-dedicated headcount Amazon-dedicated headcount as a % of total ecommerce headcount Amazon s sales as a % of company s annual revenue $250M+ 9 6% 1.6% $100M to $250M 5 13% 1.9% $50M to $100M 3 11% 1.6% $1 to $50M 2 11% 0.3% Amazon-dedicated headcount: People who have Amazon in their job title and/or have Amazon as their retailer. Source: Profitero s LinkedIn analysis. Scope: Global 19

20 Determining headcount needs cont d % of companies with Amazon-dedicated headcount by seniority level Average Amazon-dedicated headcount by seniority level Company s annual Amazon sales Company s annual Amazon sales $1 to $50M $50M to $100M $100M to $250M $250M+ $1 to $50M $50M to $100M $100M to $250M $250M+ VP 5% 17% 0% 0% VP Director 42% 33% 45% 71% Director Manager 58% 83% 82% 100% Manager Senior 16% 17% 27% 43% Senior Staff 32% 17% 73% 57% Staff Amazon-dedicated headcount: People who have Amazon in their job title and/or have Amazon as their retailer. Source: Profitero s LinkedIn analysis. Scope: Global 20

21 Headcount some influencing factors Of course, the appropriate level of resources can actually vary widely depending on a number of factors, including: Short- and long-term performance objectives. For example, do you want to aggressively invest in a grab for share? Or contrarily, just enough to sustain share while prioritizing channel profitability? Years of experience of Amazon-dedicated headcount Seniority Years of experience (avg.) Years of ecommerce experience (avg.) Job title example Customer and brand portfolio. Typically, the more retailers you intend to support and the larger your product catalog, the more resourceintensive staffing model required. Level of internal versus external resourcing. As previously discussed, outsourcing can be a smart way of building up your ecommerce business at the onset, or even on an ongoing basis, rather than adding internal headcount. VP 21 6 Vice President Sales, Amazon & Clubs Director 15 5 Global Amazon Director Manager 11 3 Senior 10 3 Senior Sales Manager US ecommerce Amazon Senior Account Executive US ecommerce Amazon Staff 6 2 ecommerce Business Analyst Amazon Amazon-dedicated headcount: People who have Amazon in their job title and/or have Amazon as their retailer. Source: Profitero s LinkedIn analysis. Scope: Global 21

22 Dedicated ecommerce headcount globally varies by segment Our LinkedIn analysis also illustrates that ecommerce headcount by function or role as well as level varies widely by category segment. Alcohol Baby Basic HH goods Beauty & cosmetics DIY/tools Electronics Food & beverage Home goods Office supplies Personal care Pet supplies Pharmacy, health & wellness Toys & games Number of companies Revenue / Headcount $766M $336M $342M $444M $250M $389M $447M $97M $408M $189M $483M $759M $36M Total headcount , By role Channel management Account management Marketing & media Content & digital merchandising Digital acceleration & innovation Capability management Data analytics Strategy Supply chain & operations Brand management Category management Finance Insights Shopper marketing Trade promotion HR Legal Retail search optimization 2 2 Source: Profitero s LinkedIn analysis. Scope: Global 22

23 Dedicated ecommerce headcount globally varies by segment cont d Alcohol Baby Basic HH goods Beauty & cosmetics DIY/tools Electronics Food & beverage Home goods Office supplies Personal care Pet supplies Pharmacy, health & wellness Toys & games Number of companies Revenue / Headcount $766M $336M $342M $444M $250M $389M $447M $97M $408M $189M $483M $759M $36M Total headcount , By level EVP VP Director Manager Senior Staff Source: Profitero s LinkedIn analysis. Scope: Global 23

24 Hiring from retailers, especially Amazon It s not uncommon for CPG companies to go directly to the expert Amazon when staffing ecommerce teams. Based on our LinkedIn and public job posting analyses, we found that 17% of US companies have hired somebody from Amazon. We then decomposed this figure by role to understand the type of work they re being hired in to do. A meaningful 35% hired away from Amazon work in a channel management role. Another good chunk of them, 16%, are in supply chain. This is a common phenomenon that happened in brick-and-mortar retail as well. When there s a key new retailer that you need to understand and accelerate your performance with, what better way to ramp up quickly than hire people that have experience at that retailer. US companies that have hired from Amazon Source: Profitero s LinkedIn analysis. Scope: US % of companies that hired from Amazon Did not hire from Amazon Employees hired from Amazon by role 83% 17% 18% 4% 4% 35% 4%2% 8% 8% 16% Account management Category management Capability management Hired from Amazon Channel management Strategy Marketing & media Digital acceleration & innovation 17% of US companies have hired an employee who has worked at Amazon. 35% of employees hired from Amazon work in channel management roles; 18% in account management. Data analytics Supply chain & operations 24

25 5 key takeaways Structure follows strategy. It s important that everyone in the company is on the same page regarding the firm s commitment to ecommerce and its definition of success. So, first things first. Define the strategy up front and communicate it internally. Only then will budgeting and resourcing around ecommerce fall into place with everyone in the organization understanding it, and feeling some level of ownership and involvement. 2 Culture counts. Whether it s done by experimenting or simply instilling a sense of ownership and involvement in every part of the business as you go through a digital transformation, company culture is key. Firms must help every team and individual understand what digital means for them, have the right incentive structures in place, and know what they can do to impact success. Otherwise it doesn t matter what your ecommerce budget is or how big your team is. Dedicated is better than designated. As beginners, many companies assign responsibility for ecommerce to individuals or teams with other core responsibilities. But when work becomes mission critical and identified as driving performance, it deserves someone dedicated to it. Then, as the business scales and volume grows, more dedicated resources may be justified. 4 In-source and develop expertise where it matters most. Outsourcing critical activities or renting the same team as the competition can help accelerate results, but we recommend developing expertise internally in areas you view as strategic anywhere work can yield a competitive advantage. With increasing stakes and commitment comes specialization. Performing at world-class levels of excellence requires expertise and specialized tools. Consequently, industry leaders increasingly are dedicating people in specialist roles to ensure that important work gets done and done right, at the right level. It s important to identify gaps in your ecommerce teams and where specialists may be needed by country, account team, business unit or function. 25

26 Maturity model: Building an action plan Beginner Intermediate Advanced What s next? Leadership Director of Alternative Channels or other designated leader Dedicated leader Dedicated leaders at multiple levels -- global, country, customer Digital-native leaders in C-suite Culture Skepticism Acceptance Purposeful experimentation Commercial inventiveness Defensiveness Rudderless experimentation Aligned incentives Disincentivization Competing incentives by Self-obsolescence channel / role Structure Limited internal support; most functions are outsourced Designated in-house teams Centers of excellence Dedicated digital specialists in traditional functions New specialist functions New agency/partner Accelerators &, incubators relationship models 26

27 Profitero tear sheet Dedicated ecommerce roles overview Description Yrs of exp. Yrs of ecom exp. Worked in tech Worked at Amazon Worked in consulting Channel management Responsible for overall ecommerce channel sales, performance and P&L Plan and implement digital and ecommerce strategies for new and existing online channels to drive sales Overall responsibility for establishing strategy, organization and capabilities % 3% 4% Account management Responsible for business (sales, business growth strategies, KPIs, capabilities) with one or more customers % 3% 1% Brand management Develop brand strategy and execute digital plans in support of key brands Responsible for driving marketing and business growth through the ecommerce channel for assigned brands % 0% 4% Capability management Select and implement digital capabilities that drive business results Develop, deliver and provide IT support for Digital and ecommerce applications, platforms and portal % 1% 6% Category management Work with retailer partners to improve category trees to improve shopper journey and category profiles Identify market and category share trends for sales projects % 4% 1% Content & digital merchandising Develop, syndicate, audit and analyze digital product information and content for brand and retailer websites Responsible for developing expertise in content sourcing and driving digital usability and conversion % 1% 1% Data analytics Track market and organizational sales data to measure digital performance Translate data analysis and research into actionable strategies that drive sales, conversion and growth 9 3 4% 2% 7% 27

28 Profitero tear sheet Dedicated ecommerce roles overview cont d Description Yrs of exp. Yrs of ecom exp. Worked in tech Worked at Amazon Worked in consulting Digital acceleration & innovation Develop and implement innovative digital solutions, delivering sales growth and new customer acquisition across the ecommerce channel Lead the digital transformation internally across organizational systems and externally with retailer partners Implement and share digital best practices throughout the organization % 1% 5% Finance Lead ecommerce financial assessment to make investment decisions and drive future growth Develop financial projections for organizational digital strategies, platforms and brands % 0% 8% Manage the financial go-to market development for new ecommerce channels HR Set and drive recruitment strategies to build new teams across all ecommerce divisions Develop and implement organizational ecommerce infrastructure % 0% 6% Manage internal requests and requisitions across the ecommerce team Insights Apply analytics tools and techniques to increase shopper understanding and optimize operations Develop and implement research plans to improve ecommerce performance % 0% 2% Establish organizational research approach and methodology Legal Ensure internal and external legal compliance across all platforms and processes Develop organizational processes that support digital compliance % 0% 0% Support all company employees responsible for key areas of compliance 28

29 Profitero tear sheet Dedicated ecommerce roles overview cont d Description Yrs of exp. Yrs of ecom exp. Worked in tech Worked at Amazon Worked in consulting Marketing & media Plan and execute digital marketing campaigns and strategies in support of the ecommerce channel Align ecommerce marketing plans with overall brand marketing goals Determine media investment for key brands % 2% 5% Retail search optimization Develop expertise on retailer search algorithms Optimize products performance on retailer websites % 0% 0% Shopper marketing Design and execute shopper marketing events and promotions for retailer customers Drive customer engagement via shopper marketing plans that contribute to organizational, category and channel growth strategies % 0% 2% Strategy Develop measurement and KPIs for key digital initiatives Define short-term and long-term strategic goals for the ecommerce channel % 3% 10% Create new organizational ecommerce teams and divisions Supply chain & operations Responsible for ecommerce channel stock management, supply chain logistics Prioritize, identify and resolve daily customer and retailer partner issues % 5% 3% 29

30 Want to learn more? About Profitero Ask Profitero how our expert analyst teams can support your ecommerce organization in getting the most from your digital shelf investment. For more information, or visit For additional guidance, contact Profitero today at: Tel US: Tel UK: Profitero is the ecommerce Performance analytics platform of choice for leading brands around the world. With Profitero, brands can measure their digital shelf performance across 8,000+ retailer sites and mobile apps in 50 countries, gaining actionable insights to improve product content, search placement, ratings & reviews, availability, assortment and pricing. Profitero also allows brands to measure their Amazon sales & share performance, along with the ability to correlate their sales performance with changes across the digital shelf. Many of the world s leading brand manufacturers depend on Profitero s granular and highly-accurate data to measure and improve their ecommerce performance. These include Barilla, Beiersdorf, Edgewell, General Mills, Heineken, Kids II and L Oreal. 30

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