Online retailer Otto is cutting approximately 460 full-time positions, primarily at its headquarters in Hamburg, following the elimination of around 480 customer service jobs in 2025. This move is triggered by a comprehensive cost-cutting program under new CEO Petra Scharner-Wolff, aimed at significantly reducing the company’s cost base by 2027/28. The job cuts primarily affect marketing, controlling, and technology departments, coinciding with a generational shift within the owning family. A key factor is the intense margin pressure in online retail, and Otto is also responding to a weak consumer environment. While the cuts primarily affect employees in central corporate functions, the restructuring will fundamentally alter the company’s overall strategic direction. (manager-magazin: 19.02.26)
Second round of cost-cutting within a year
Back in 2025, Otto had already eliminated around 480 customer service positions, primarily through the closure of call centers. Now comes the next wave, but this time it hits key management and development departments. This represents a significant cut, as marketing, controlling, and IT have traditionally been considered core competencies.
The group is pursuing a clear goal: to reduce its annual cost base to around €500 million in the long term. Therefore, management is intervening more deeply in the organization than in previous restructurings. While earlier adjustments were primarily operational, the current round encompasses strategic units.
Generational Change Intensifies the Transformation
In parallel with the cost-cutting measures, the owning family is preparing for a change in leadership, as Benjamin Otto will assume a key role on the foundation’s board of trustees in 2026. This step marks a generational shift and coincides with a period of economic reorganization. The proximity in time reinforces the impression of a strategic relaunch.
Since March 2025, Otto Group CEO Scharner-Wolff has been leading the company. She is placing greater emphasis on profitability and faster decision-making. “We need to simplify our structures and become more efficient,” she explained internally, according to company sources, while describing the cost-cutting measures as necessary.
Focus on Efficiency Instead of Growth
Otto is thus responding to ongoing competitive pressure from international platforms, and the reluctance to spend in Germany is also impacting business. The e-commerce market is growing more slowly than during the boom years, but costs and investments remain high. Therefore, the company is clearly shifting its focus to profitability.
This latest measure demonstrates that Otto is not only streamlining peripheral areas but also reorganizing core functions. Marketing budgets are under review, as are technological development projects. Meanwhile, management aims to eliminate redundancies and shorten decision-making processes.
Strategic Restart with Risks
The job cuts affect hundreds of employees and also send a signal to the entire retail sector. Otto is thus visibly abandoning its long-standing policy of particularly socially responsible restructuring. The new course prioritizes economic stability, but internal pressure to adapt is increasing.
Whether the company will become faster and more competitive as a result will be decided in the coming fiscal years. One thing is already clear: the restructuring goes beyond a normal cost-cutting measure. Otto is fundamentally reorganizing its structure while the next generation assumes strategic responsibility.