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Zulily’s headquarters in Seattle’s Belltown neighborhood. (GeekWire Photo / Taylor Soper)

Online retailer Zulily has let go of an undisclosed number of employees as part of broader structural changes within the company, GeekWire has learned.

A Zulily spokesperson confirmed the layoffs but declined to provide details about how many employees were affected. Personnel at the company’s Seattle and Columbus offices were let go. Zulily employed 1,300 people in Seattle as of January.

In a note to employees obtained by GeekWire, Zulily CEO Jeff Yurcisin said the company was at “a critical inflection point” that required changes to the business. Yurcisin indicated that the layoffs affected the merchandising and studio teams and that the retailer would be increasing investments in technology and user experience.

The company’s studio team is responsible for images, graphics and copy on the website and app. The merchandising team manages Zulily’s rapidly-changing product offerings that include kids apparel, shoes, home decor, toys, and more.

Read Yurcisin’s full letter at the bottom of this story.

The Zulily spokesperson sent this statement to GeekWire:

“At Zulily, we’re always testing, learning, and innovating to provide a differentiated experience to our customers. Today, we announced to our team members organizational changes designed to accelerate focus and growth in areas of innovation that will help us best meet the evolving needs of our customers and other key stakeholders. Unfortunately, this restructuring comes with team member impact. Impacted team members will be provided with support for their transition.”

This is the first major restructuring in the 9-year-old company’s history.

Zulily is owned by QVC parent Qurate following its $2.4 billion acquisition in 2015. Qurate reported in May that quarterly revenues from Zulily were down 5 percent to $397 million. That shortfall followed many quarters of revenue growth — Zulily’s annual revenues increased 13 percent, to $1.82 billion, from 2017 to 2018.

Qurate said the revenue decline in Q1 was due to “lower unit volume driven by a decrease in new customers and lower frequency of purchases from existing customers, as well as lower average selling price. Product categories that led the sales decline were apparel (kids and women) and home. Zulily’s results were affected by less efficient customer acquisition spend on certain digital marketing channels and the impact of sales tax collection in additional states.”

Zulily reported 6.5 million customers in Q1, up 7 percent year-over-year.

(GeekWire Chart; data from Qurate earnings reports)

Yurcisin, a former Amazon executive and Shopbop CEO, took over as CEO last year after co-founder Darrell Cavens officially stepped down from the role.

The retailer has been working on rebranding its e-commerce offerings, which historically centered around daily deals for moms with small children. In January, the company inked a jersey sponsorship deal with Sounders FC, a men’s professional soccer team in Seattle.

“We started as a moms and kids business,” Zulily senior vice president of marketing Kevin Saliba said at the time of the Sounders deal. “We’re much more focused now on women or men, with or without kids.”

The company employed 3,500 people around the world as of January. In addition to Seattle and Columbus, Zulily also has offices in Reno, Nev., Bethlehem, Pa., and Shenzhen, China.

Here’s the full memo from Yurcisin:

Team,

We are at a critical inflection point in our business. As we look to the future, we know we must take some key steps to evolve and ensure the strength and longevity of our business, while keeping our focus on what matters most to our business: delighting our customers through the joy of discovery, unbeatable pricing, and an experience that is fun and engaging.

Today I want to share that we are taking steps to organize our operations in a manner that will enable us to work efficiently, while delivering the best possible experience for our customers. This includes streamlining our Merchandising and Studio organizations to refocus our efforts to bring highly curated unique finds and beloved brands to our customers every day. We will also be increasing our investment in technology, the user experience, and other areas to help support speed and agility as we experiment and innovate to build our fun and addictive shopping experience.

Unfortunately, these changes impact some of our team members at both our Seattle and Columbus offices. These were difficult decisions to make, but we are committed to supporting our impacted team members as they transition out of our company. On behalf of the leadership team, we deeply appreciate all of your hard work and dedicated focus on our customers.

We will continue to have an open dialogue about the state of our business. Together, we will remain focused on finding new ways to inspire and engage our customers.

Thank you, Jeff

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