Etsy CFO Looks to AI and Cloud to Drive Growth Amid Economic Uncertainty
Etsy Inc. Turns to AI and Cloud to Drive Growth Amid Economic Uncertainty
In the face of an uncertain economic outlook, Etsy Inc. is exploring new avenues to engage its more than 95 million active users and drive spending. The online marketplace’s chief financial officer, Rachel Glaser, is banking on the power of artificial intelligence and the cloud to propel the company forward.
With people’s balance sheets feeling the strain and discretionary spending taking a hit, Glaser recognizes the challenges ahead. However, after nearly 40 years in finance and over seven years at Etsy, she is preparing to retire and pass the torch to a successor. As she transitions out, Glaser is focused on leveraging technology investments to reignite growth in a shifting economic landscape.
Etsy, known for its platform where artisans offer handmade goods, saw a decline in gross merchandise sales in the second quarter, reflecting a broader slowdown post-pandemic. Glaser, 63, emphasizes the importance of investing in AI, cloud computing, and other technologies to enhance user experience and drive future growth.
By utilizing AI to optimize product recommendations and transitioning to cloud-based infrastructure, Etsy aims to streamline operations and improve efficiency. Despite initial margin contractions, the move to the cloud has significantly boosted the speed and performance of Etsy’s machine-learning tools.
Under Glaser’s leadership, Etsy has pursued strategic acquisitions and implemented cost-saving measures to drive profitability. The company’s technology initiatives, including features like “gift mode” that suggest personalized gift recommendations, are expected to fuel sales growth.
While gross merchandise sales may see a temporary decline due to weakened consumer spending, analysts project a return to growth in the coming years. Etsy’s unique business model, which minimizes overhead costs associated with warehousing and distribution, generates strong free cash flow, providing flexibility for future investments.
As Glaser prepares to step down and guide the transition to a new CFO, the focus remains on navigating economic uncertainties and sustaining growth in a competitive market. With a commitment to innovation and customer experience, Etsy is poised to adapt and thrive in a rapidly evolving digital landscape.
Overall, Etsy’s strategic investments in technology and marketing, coupled with its commitment to quality and authenticity, position the company for continued success in the years to come.
