Wayfair CEO Niraj Shah has confirmed to Wayair employees that the business is to exit the German market with immediate effect.
In a statement to employees ,he said: “Germany has been an important part of our journey for the past 15 years, serving as one of our original entry markets into Europe, alongside the UK. During this time, we built a solid base of customers, developed supplier partnerships to provide the selection and value in the home category that defines our brand, and built a strong European infrastructure. Over the years our success in the UK outpaced our success in Germany, as we were able to develop a household brand in the UK, and grow our market share there, all while developing strong unit economics. Our Germany efforts lagged behind, but we set out to close that gap over the last year.
“Since Covid, and in particular over the past year, we have made meaningful progress in Germany, thanks to the work of many of you directly involved in the market. However, despite these efforts, scaling our market share and improving our unit economics in the German market has proven challenging due to factors such as the weak macroeconomic conditions for our category in Germany, the lower maturity of our offering, our current brand awareness, and our limited scale. In our recent assessment, we concluded that achieving market-leading growth in Germany still remained a long and costly endeavor, and one that is increasingly lagging the potential return we see in other areas. To ensure we align our resources with initiatives that can deliver the greatest impact, we made the difficult but necessary decision to reallocate efforts to areas with strong long-term potential where our current efforts are showing great progress.”
Wayfair is offering impacted employees a comprehensive support package which includes severance, and access to its employee assistance program. It will continue to focus on operations and investments in its international markets, namely Canada, the UK, and Ireland, where it has meaningful market share and which it believes holds significant potential to replicate the success achieved in the U.S.
Globally, its core initiatives include expanding its physical retail footprint, optimising marketing reach, growing its loyalty program, Wayfair Rewards, and developing the Wayfair Verified program. Additionally, it will continue to invest in technology improvements.
“To our colleagues leaving: Thank you for your dedication and contributions to our company. We have learned so much from you and are grateful for the positive impact you’ve made. And to all of you who have worked very hard over numerous years on the Wayfair Germany business, I am sorry that despite all of our efforts we were not able to successfully develop Wayfair.de into the German market winner.
Thank you all for your understanding, support, and your faith and belief in the long-term potential of Wayfair”, added Shah.
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