Up Next In Commerce

We’ll Be Back Soon!

info@mission.org (Mission.org) — Thu, 2 Mar 2023 08:00:00 +0000

After more than two-and-a-half years and nearly 300 episodes of uninterrupted commerce content, we’re taking a brief pause. Stephanie and the team behind Up Next in Commerce is busy cooking up some fun and exciting ideas for our next season of the show, and while that’s happening, we’ll be pushing pause on releasing new episodes. But we’ll be back, and we want to hear from you about what you want to see and hear when we return! So get in touch by emailing info@mission.org. And in the meantime, you can keep up with Stephanie by listening to the Mission Daily podcast!

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Better Commerce Through Conscious Consumerism

info@mission.org (mission.org) — Thu, 23 Feb 2023 08:00:00 +0000

Sustainability and consciousness are often seen as buzzwords coming from ecommerce companies. But for those who build their businesses around doing right in the world, these terms are nothing short of foundational. In this episode, Jeff Scult, founder of sustainable retailer One Golden Thread, discusses how his company gives more back to nature then it takes to create products in the company’s wildly popular clothing line.

Tune in to learn:

0:00 Episode start

6:51 The rise of consciousness among consumers

10:14 The origin of One Golden Thread

14:41 The inspiration for the company’s process and design

37:39 What it means to be truly sustainable

Mentions:

Adidas
Avery Dennison
NASA
TED Talks
Burning Man
Dave Zebrowski
Rosario Dawson
Kellogg’s

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

How Chomps Takes A Bite Out of Retail and Ecommerce

info@mission.org (Mission.org) — Tue, 31 Jan 2023 08:00:00 +0000

Although it may seem like Chomps has been an overnight success, behind the scenes there has been a lot of hard work, risky bets, and beneficial partnerships that has helped elevate the brand. On this episode, Pete Maldonado, the Co-founder and CEO of Chomps and Stacy Hartnett, the Vice President, E-Commerce & Marketing at Chomps, discuss how the company was bootstrapped, and how it has scaled through both retail and online platforms.

Tune in to learn:

The beginnings of Chomps (2:00)
The timeline of success (5:45)
Lessons learned after getting into Trader Joe’s (13:30)
How and why Stacey came on board (15:00)
Creating an appetite for risky bets (21:20)
Identifying the right platforms (23:00)
Contrarian ideas or data to track (31:20)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Ecommerce and Marketing Lessons Learned from Wayfair, Walmart, and More

info@mission.org (Mission.org) — Thu, 26 Jan 2023 08:00:00 +0000

Before she became the VP of Ecommerce and Marketing at Pharmaca, Elizabeth Garry cut her teeth in the digital and marketing world at brands such as Wayfair, Walmart, and Camping World. In this episode, Liz shares with us the lessons she’s learned along the way, including how to vet a potential manager to see whether they have your best interests at heart, and what it looks like to create success as a team.

Tune in to learn:

Liz’s background and her pivot to ecommerce (2:20)
Learning directly from the Wayfair founders (5:30)
How to vet a potential manager (12:25)
Creating success with your team (22:15)
What is Pharmica? (30:00)
Creating a digital journey that helps customers (34:45)
Predictions for 2023 (38:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

How AT&T Stays Innovative

info@mission.org (Mission.org) — Tue, 24 Jan 2023 08:00:00 +0000

When a company is as large as AT&T and has a legacy that dates back nearly 150 years, you might think that it’s difficult for the brand to adapt and innovate. Maryanne Cheung, the VP of ecommerce at AT&T, is here to tell you you’re wrong. On this episode, she details all the ways that AT&T has been able to change with the times in order to serve today’s more digitally-focused customers.

Tune in to learn:

How AT&T evaluates change (3:00)
Small bets that have made a big impact (5:00)
The omnichannel mix at AT&T (9:50)
Some predictions for the next five years (14:45)
Outside of customer service, how does AT&T separate itself from competitors? (19:45)
What is the future of call centers? (28:45)
What keeps work exciting? (38:45)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Proven DTC Guidance To Make Your Brand Soar In 2023

info@mission.org (mission.org) — Thu, 19 Jan 2023 08:00:00 +0000

The DTC world is forever shifting and evolving. Staying on top of changing trends and best practices takes work. We try to make that easier for you by sharing insights from experts throughout the industry. Today, we’re doubling our efforts by speaking with fellow podcast host Eric Dyck, who is the founder and CEO of DTC Newsletter and host of DTC Podcast. Eric shares his latest findings and gives some tips on how to win with newsletters and content marketing.

Tune in to learn:

How Eric got into the DTC space (2:00)
Winning with your newsletters (6:20)
How to stand out when everyone is moving in the same direction (9:50)
The role AI will play for brands moving forward (15:20)
The challenges companies face in 2023 (26:00)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Building An Omnichannel Brand and Strategy

info@mission.org (Mission.org) — Tue, 17 Jan 2023 08:00:00 +0000

Shinola is a lifestyle brand that partners with family businesses and iconic brands to showcase a wide range of American-designed products. Which means the company has to know how (and where) to continually reach all segments of an ever-growing audience. Joel Layton, the VP, Head of Ecommerce, Digital & Marketing for Shinola discusses what that looks like.

Tune in to learn:

Are we in a DTC vs retail world? (6:30)
Enacting a test and learn strategy (9:35)
Going all-in on TikTok (12:55)
Thinking ahead for the coming year (19:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Selling Shares in Iconic Artworks

info@mission.org (mission.org) — Thu, 12 Jan 2023 08:00:00 +0000

In an innovative move, Scott Lynn, CEO and Founder of Masterworks, democratized art investing by registering art pieces with the SEC and selling shares to investors. The first company of its kind, Masterworks is now a major art dealer with more than 600,000 investors on its platform. Scott dives into the future of art investing, the historical data the company analyzes, and how to determine which art pieces will perform.

Tune in to learn:

Historical data in the art industry (7:00)
Art investing over the next couple of years (10:46)
The role of alternative asset classes in coming decades (20:55)
How do you determine which art will perform financially? (25:40)
Evolutions and trends in art valuation (27:20)

Mentions:

Sotheby’s
Basquiat
Paul Allen’s $1.5 billion collection sale
Banksy
Joan Mitchell
Sam Gilliam

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

The Clean-Eating, Brand-Building Journey of Kevin’s Natural Foods

info@mission.org (Mission.org) — Tue, 10 Jan 2023 08:00:00 +0000

In an effort to fight off a debilitating autoimmune disorder that struck him years ago, Kevin McCray turned to a strict Paleo diet free of gluten, refined sugars, and soy. It was a decision that would spark a truly inspirational and wildly successful entrepreneurial mission. The President and Co-founder of the healthy prepackaged meal company Kevin’s Natural Foods joins us to talk about how his clean-eating lifestyle took him from the hospital bed to spearheading a brand that can now be found in some of the largest retail stores across the country.

Tune in to learn:

The origins of Kevin’s Natural Foods (2:06)
How Kevin negotiates prices with suppliers (14:40)
Advice on getting a product into major retail stores (24:00)
The importance of fortifying a brand position (30:55)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Exploring Digital Payment Options and Personalized Communication with Customers

info@mission.org (Mission.org) — Thu, 5 Jan 2023 08:00:00 +0000

What do Apple Pay, WhatsApp, and Crypto have in common? They are all preferred channels of payment and messaging that customers may prefer to use. Michael Affronti, Senior Vice President and General Manager of Payments and Messaging at Salesforce, shares his perspective on how companies should evolve their options for communication and payments to build better, more personalized relationships with their customers.

Tune in to learn:

About Michael’s patents (05:15)
What international payments trends will be emerging in the US (14:30)
Why Michael is keeping a close eye on cryptocurrency (24:00)
How brands should reevaluate their messaging systems (29:00)

Mentions:

Stat for preferred payment method
“Innovation Stack: Building Unbeatable Business One Crazy Idea at a Time” by Jim McKelvey
“The Innovation Stack: How Square Co-Founder Jim McKelvey Thinks About Disruption” - James’ Episode on Up Next In Commerce
Character.AI - Character bot
WhatsApp - Free, world-wide messaging and calling app
Michael Affronti’s LinkedIn

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

“Celebritizing” Your Way to CPG Success

info@mission.org (Mission.org) — Tue, 3 Jan 2023 08:00:00 +0000

How do successful CPG companies build a following? Nick Saltarelli, Co-founder of Mid-Day Squares, shares how he and his partners “celebritized” themselves through an Instagram reality show to break into the chocolate industry. He dives into social media strategy, building a fanbase that asks grocery stores to stock their products, and fighting back against attacks.

Tune in to learn:

Fighting cyberattacks and legal battles against Mid-Day Squares (01:45)
Launching without support from grocery stores (14:55)
Why you should remove yourself from the data tracking obsession (24:40)
“Cracking” TikTok (31:15)

Mentions:

Pepsi, Where is My Jet?
Liquid Death, CEO and Cofounder, Mike Cessario
- Up Next In Commerce Interview with Hamid Saify, SVP of Digital Retail at Liquid Death
Mid-Day Squares Uncensored Podcast
Loverboy and Summer House
- Up Next in Commerce Interview with Nick Califano, COO, Loverboy

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Mission’s End-of-Year Wrap-up: Key Business Insights for 2023

info@mission.org (Mission.org) — Thu, 29 Dec 2022 08:00:00 +0000

On this special end-of-year crossover episode, the hosts from Up Next in Commerce, Marketing Trends, and IT Visionaries meet up again to discuss their biggest takeaways from their guests over the past year, and to make some predictions for what should be an exciting 2023 in marketing, tech, and ecommerce.

Tune in to learn:

Why your employees are your greatest customers (7:50)
Why good business instincts can help overcome a lack of data (13:55)
Why intuition matters, even in data-driven industries (22:00)

Mentions:

David Ting, Zenni
David Heinemeier Hansson, 37signals
Stephanie Dobbs Brown, CMO, Intercontinental Exchange
Lil’ Wayne
Kevin Warren, UPS
Eric Toda, Meta

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Building new baselines for D2C commerce

info@mission.org (Mission.org) — Tue, 27 Dec 2022 08:00:00 +0000

As instant commerce becomes increasingly popular, how can consumers rely on products being in stock? Daniel Folkman, SVP of Business at Gopuff, explains that with more than 500 micro fulfillment centers, Gopuff can guarantee delivery of its stocked products as the customer builds their order. Listen to the episode to learn more about how Gopuff is leading experiments on sample feedback data for advertisers and how the company is staying ahead of its competitors.

Tune in to learn:

About the benefits and challenges of providing products through company-owned fulfillment centers (06:40)
Why Daniel thinks Gopuff will outlast its competitors (12:10)
The Gopuff ad platform (17:33)
What avenues Gopuff is exploring to capitalize on sample tracking (22:17)

Mentions:

“GoPuff forecasts mass extinction for ‘majority, if not all’ rivals this year” by Emily Hawkins for City A.M. on 08/29/2022
Rafael Ilishayev, Co-Founder and Co-CEO of Gopuff
Yakir Gola, Co-Founder and Co-CEO of Gopuff
PepsiCo
Coca-Cola

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Earning the Right to be Idealistic in Business

info@mission.org (Mission.org) — Thu, 22 Dec 2022 08:00:00 +0000

How do you build a socially-conscious product business within a competitive market? Mike Beckham, CEO and Co-founder, Simple Modern, shares his experience as a founder, diving into finding and protecting white space in the market, building brand loyalty and creating a great culture.

Tune in to learn:

Identifying white space in the market (7:20)
Building “moats” in competitive markets (13:30)
The need to have a good product in order to give back (23:20)
Mike’s advice for founders (33:15)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Bringing Ecommerce to the African Mass Market

info@mission.org (Mission.org) — Tue, 20 Dec 2022 08:00:00 +0000

How can an ecommerce brand serve middle to low-income African consumers, even those that are offline or lack access to technology? Tracey Turner, Founder and Chair of Copia Global, is bringing e-commerce to the mass market in Africa and dives into the details of their approach. She shares the logistics of their unique model, how they have built consumer trust and insights into the market across Africa.

Tune in to learn:

Using a for-profit model for social impact (04:45)
Bringing ecommerce to the African mass market (10:00)
Copia Global’s impact (20:25)
The mindset needed to enter new markets (22:43)
The importance of earning customer trust in new markets (28:00)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Sustainability Within Skincare With Lena Korres

info@mission.org (Mission.org) — Thu, 15 Dec 2022 08:00:00 +0000

What should companies be most concerned with in this era of commerce? Lena Korres, Co-Founder and CIO at KORRES, explains the importance of keeping production sustainable so consumers can feel good about the products they’re using. Tune in to learn more about how natural ingredients not only benefit the consumer, but also the companies that produce skincare.

Tune in to learn:

What KORRES values about herbal remedies (3:40)
The benefits of Greek Yogurt (12:55)
Why Santori grapes are amazing (18:50)
How to gain awareness for your products (25:05)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Exploring Live Stream Commerce with Vassil Mladjov

info@mission.org (Mission.org) — Tue, 13 Dec 2022 08:00:00 +0000

With so many new commerce options available, what avenues can companies explore to reach more consumers? Vassil Mladjov, Board Member at Tallio, shares his thoughts on the growth of live stream shopping and how it is becoming a more prevalent way to purchase products online. Also, tune in to hear how collecting user data can help provide an optimal consumer experience, breaking boundaries within e-commerce opportunities.

Tune in to learn:

Why live stream shopping isn’t as popular in the U.S. (06:00)
How Tik Tok can help with targeting the right customers (11:35)
Keeping live shopping relevant even after the live event (18:44)
How companies can implement personalization through user data (26:20)
About thinking outside of the box to reimagine the traditional revenue stream (28:45)

Mentions:

Bambuser - live video shopping
TikTok - short-form video service
Metaverse - virtual reality iteration of the internet

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

How Loverboy Hacked the Alcoholic Beverage Market

info@mission.org (Mission.org) — Thu, 8 Dec 2022 08:00:00 +0000

How did an alcoholic beverage company manage to reach nationwide distribution without a single dollar spent on marketing? Nick Califano, the COO of the hard tea and canned cocktail maker Loverboy, joins us to discuss the unique journey that propelled the company from reality TV scene-stealer to retail shelves across the country.

Tune in to learn:

The backstory of Summer House and Loverboy (09:15)
How Loverboy stays ahead of trends in the industry (25:00)
Nick’s thoughts on the potential of branded content (37:55)

Mentions:

Summer House | Bravo TV Official Site

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Democratizing Health and Wellness with Restore

info@mission.org (Mission.org) — Tue, 6 Dec 2022 08:00:00 +0000

Unconventional health treatments like cryotherapy and infrared sauna baths are not exactly known for their affordability. One rapidly growing company, however, is transforming the wellness landscape by democratizing access to such cutting-edge health services. With over 175 locations across the country, Restore Hyper Wellness is quickly bringing its holistic healthcare approach to the mainstream. Tune in to hear Restore CEO and Founder Jim Donnelly and CMO David Fossas discuss the joys and challenges of operating within a franchise model, and why they are committed to making health and wellness treatments safe, fun, and affordable.

Tune in to learn:

An overview of Restore and its services (3:40)
Why Restore uses a franchise model (16:20)
The marketing approach at Restore (23:55)
How Restore avoids the pitfalls of the biohacking frontier (38:00)
The future of using space for wellness and production (46:30)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Asian Snack Brand That is Making Waves in the U.S.

info@mission.org (mission.org) — Thu, 1 Dec 2022 08:00:00 +0000

How do you make a popular Asian product thrive in the U.S. market? Irvin Gunawan, Founder and CEO of Irvins, shares his experience building a snack food brand out of their restaurant in Singapore and later bringing these products to the U.S, introducing Americans to a new snacking sensation. Tune in to hear about the company’s backstory and what Irvin learned from this unique expansion.

Tune in to learn:

Irvin’s journey from a Singaporean restaurant into a viral snack product (1:50)
Building relationships with major U.S. retailers (11:00)
What changes are needed to bring a product from Asia to the U.S. (16:30)

Mentions:

Cardi B

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

How FOX Corporation Succeeds in the Modern Media Landscape

info@mission.org (mission.org) — Tue, 29 Nov 2022 08:00:00 +0000

Michael Ibrahim, Senior Vice President of Digital Product at Fox Corporation, has several patents under his belt and a skill for building successful teams; he is contributing to major success at Fox Corporation. He shares his insights into the world of digital, diving into the most important metrics for Fox and how they make themselves available to consumers wherever they want to access their media.

Tune in to learn:

What it takes to earn patents (1:45)
How to make media available to consumers across platforms (9:10)
The metrics that matter for Fox (16:20)
Sparking consumer interest in watching content (19:30)
How to manage teams and get people working well together (28:40)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Mission Thanksgiving Roundtable: Is Black Friday Dead?

info@mission.org (mission.org) — Thu, 24 Nov 2022 08:00:00 +0000

With the holiday shopping season in full swing, how are businesses handling the busiest commerce period of the year? On this special crossover episode, the hosts from Mission.org podcasts, Up Next in Commerce, Marketing Trends and IT Visionaries join forces for the first time ever to discuss all things retail. Tune in to hear Stephanie, Jeremy, and Albert share their thoughts and expertise about the latest shopping technology, holiday cyber threats, and whether shifting consumer attitudes will make Black Friday a thing of the past.

Tune in to learn:

Themes surrounding Black Friday and Cyber Monday (2:10)
Cybersecurity’s role in Black Friday and Cyber Monday (11:55)
Is there consumer optimism in today’s uncertain market? (16:45)
End capping and its evolution into ad-buying (25:30)

Mentions:

“Bringing Build-A-Bear Alive in New Ways With Jenn Kretchmar, Chief Digital and Merchandising Officer of Build-A-Bear Workshop” (Marketing Trends podcast; Episode 359)
“How The Simple P&L Statement Can Be Key To Long-Term Success” (Up Next In Commerce podcast; Episode 33)
“Not Dumbing It Down: DECIEM and the Art of Straightforward Marketing with Jordanne Dyck” (Up Next In Commerce podcast; Episode 197)
“Flipping Ecommerce on its Head” (Up Next In Commerce podcast; Episode 90)
Common Thread Collective
“Where ‘Credit’ Is Due with Randy Kern, CTO, Marqeta” (IT Visionaries podcast; Episode 417)
Stephan Pretorius - Chief Technology Officer - WPP
“Smart TV and Smarter TV Marketing With Jordan Rost, Head of Ad Marketing, Roku, Inc.” (Marketing Trends podcast; Episode 341)
American Giant: American Made Clothing & Activewear
Danny Fields - EVP Engineering and Chief Technology Officer - Avalara
“Why Liquid Death Didn’t Water Down Its Marketing Strategy” (Up Next In Commerce podcast; Episode 262)

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Ethical and Effective Use of AI

info@mission.org (Mission.org) — Tue, 22 Nov 2022 08:00:00 +0000

How should companies think about AI? When should it be used? Should it be regulated? Dr. Athina Kanioura, Chief Strategy and Transformation Officer of PepsiCo, shares her expert insights and explains how AI increases efficiency at PepsiCo. She also dives into their cross-functional “digital hubs” and the bias problem with hiring algorithms.

Tune in to learn:

Athina’s most contrarian thought about AI (2:08)
How AI makes PepsiCo more efficient (15:15)
Addressing the bias issues and creating ethical AI (19:45)
The purpose of PepsiCo’s digital hubs (29:50)
Measuring KPIs (32:30)
How to upskill talent (34:30)

Mentions:

Wuthering Heights (novel by Emily Brontë)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Innovating in Niche Spaces

info@mission.org (Mission.org) — Thu, 17 Nov 2022 08:00:00 +0000

What are the benefits of having a passion project for a career? Rob Bossen, CEO of Grey Duck, shares that his passion for stand-up paddleboarding allows him to innovate within the niche spaces of outdoor water activities to bring solutions to consumers. Tune in to hear more about Rob’s transition from finance to outdoor water activities and what his experiences have taught him throughout his journey.

Tune in to learn:

About Grey Duck’s stand-up paddle board innovation (08:40)
How Grey Duck sells direct to consumers (13:25)
About the growing trend for inflatable products (16:00)
Why the used product market is on the rise (28:00)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The “E-commerce Everywhere” Vision With Derek Correia, President of ReserveBar

info@mission.org (Mission.org) — Tue, 15 Nov 2022 08:00:00 +0000

How does e-commerce completely alter the way alcohol businesses reach consumers? Derek Correia, President of ReserveBar, knows that B2C can widen the horizon for beverage sales across the country and provide curated, personalized experiences for customers. Tune in to hear how ReserveBar is changing the market through partnerships and a vision to optimize how people explore, learn about, and purchase premium wines, champagnes, and spirits.

Tune in to learn:

The behind-the-scenes of building a B2B and B2C company (5:55)
Why one-to-one relationships with the customer are valuable (13:00)
How the ecommerce everywhere vision originated at ReserveBar (29:40)
How to avoid cannibalizing your sales (23:20)

Mentions:

Anheuser-Busch Brewing Company

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Finding White Space and Timing Entry Into New Markets

info@mission.org (Mission.org) — Thu, 10 Nov 2022 08:00:00 +0000

How do you find white space in your market? And when you do, how should you time your product release? Ken Wegner, President of Jel Sert, and his son Gavin, Senior Brand Manager of subsidiary SLIQ Spirited Ice, share their approach at Jel Sert. They discuss their experience at this nearly 100-year-old family business, and how the company successfully transitioned into the competitive alcoholic beverage industry.

Tune in to learn:

Lessons from Jel Sert’s history that resonate today (8:46)
How to grow and innovate responsibly (13:50)
How to find white space and time your entry into the market (22:57)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Why Liquid Death Didn’t Water Down Its Marketing Strategy

info@mission.org (Mission.org) — Tue, 8 Nov 2022 08:00:00 +0000

How can companies capture customer attention and spark interest in their brand? Hamid Saify, SVP of Digital Retail at Liquid Death Mountain Water, discusses the brand’s “tongue-in-cheek” approach and its “connection-first” marketing strategy. Tune in to learn about the company’s success stories and how to drive loyalty through merchandise.

Tune in to learn:

Which metrics matter and why you should not be hyper-reactive (7:20)
How to use merchandise to actually build brand loyalty (12:55)
Coming up with design ideas for merchandise (19:04)

Mentions:

Austin City Limits Music Festival
Mike Cessario (CEO and Co-Founder of Liquid Death)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Innovating Frozen Pizza With Jasper Fallucca, Director of Business Development at Palermo’s Pizza

info@mission.org (Mission.org) — Thu, 3 Nov 2022 07:00:00 +0000

How can a company stand out in an overpopulated market? Jasper Falluca, Director of Business Development at Palermo’s Pizza, shares innovation through ecommerce to create a new platform for DTC frozen pizzas. Tune in to learn more about Palermo’s Pizza and its accomplishments in the pizza business by building meaningful connections with customers and using data to create successful products.

Tune in to learn:

The story behind founding the family business (02:05)
More on the driving force behind growth (07:00)
How to build lasting relationships with customers (16:10)
The tech stack behind the expansion to DTC (23:30)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Disrupting the Market in the Middle Ground With Gabe Coyne, CEO of Stix Golf

info@mission.org (Mission.org) — Tue, 1 Nov 2022 07:00:00 +0000

How do startups aim to disrupt the current market? Gabe Coyne, CEO of Stix Golf, explains that businesses need to create affordable options in the middle ground between bargain and luxury. Tune in to learn more about Gabe’s process for finding the right channels to showcase quality products for affordable prices.

Tune in to learn:

Behind the scenes of designing the Stix clubs (8:45)
How Stix built awareness during a second launch effort (15:40)
Thoughts on retail for DTC companies in today’s market (17:20)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Hot Takes on Branding and Ad Strategy With Alexa Kilroy, Head of Brand at Triple Whale

info@mission.org (The Mission, mission.org) — Thu, 27 Oct 2022 07:00:00 +0000

How should ecommerce brands be thinking about advertising strategy? What will work now and into the future? Alexa Kilroy, Head of Brand at Triple Whale, shares her hot takes based on the data and her industry experience. Tune in to hear her thoughts on the ad platforms that you should pay attention to and the return to some old-school ad strategies.

Tune in to learn:

Triple Whale’s DTC reality TV show “DTC After Dark” (2:30)
Dissecting inaccuracies in platform advertising data (18:30)
Recent shifts in “behind the scenes” data (24:20)
Interesting and lesser known data metrics (38:48)
A “hot take” on the advertising industry (32:30)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Creating the Best Customer Experience With Michael Bair, SVP of Customer Experience at FIGS

info@mission.org (The Mission, mission.org) — Tue, 25 Oct 2022 07:00:00 +0000

What is the recipe for exceptional customer experiences? Michael Bair, SVP of Customer Experience at FIGS, thinks the ingredients to create the best experiences is by listening to the customer, speaking the customer’s language, and asking for opinions. Listen in to hear more about Michael’s strategy for building the right team to ensure customer experience success.

Tune in to learn:

How do you know if you have a good customer experience? (2:15)
Optimizing your team in an uncertain time (7:30)
The north star metrics Michael pays attention to (12:30)
Why using customer language is important (18:30)
Why personalization is about being a product expert (24:25)
What to pay attention to moving forward (38:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Taking Tech Startup Culture to a DTC Retailer With David Ting, CTO of Zenni Optical

info@mission.org (Mission.org) — Thu, 20 Oct 2022 07:00:00 +0000

What strategies should retail steal from the tech startup world? David Ting, CTO of Zenni Optical, shares his experience moving from tech startups into DTC retail, outlining the big impact his team was able to make in their first two months and the details of how they did it. Tune in to hear his insights on building a best-in-class engineering team, a highly ranked mobile app, and more.

Tune in to learn:

The day-to-day life of a CTO (6:40)
How to increase the success of a mobile app (13:30)
How to build a best-in-class engineering team (21:12)
The best tech tools for DTC companies (34:30)

Mentions:

celential.ai

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

The Crocs Comeback Story with Feliz Papich, VP at Crocs

info@mission.org (The Mission, mission.org) — Tue, 18 Oct 2022 07:00:00 +0000

It’s fair to say that Crocs has had its share of highs and lows. People have loved them and hated them, but there is no disputing that the shoes have become ubiquitous whether you like them or not. But what has it been like to be inside the Crocs car on this roller coaster ride and how has the company found ways to win over and over? Feliz Papich, VP of Digital Product and Consumer Experience at Crocs, discusses that and more on this episode.

Tune in to learn:

When did digital become a priority for Crocs and how is it going? (7:20)
The Crocs comeback story and how Crocs listens to customers (13:33)
Thoughts on globalization (20:28)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

That’s Meta: A Look Inside the Meta Store and Reality Labs with Director Martin Gilliard

info@mission.org (The Mission, Mission.org) — Thu, 13 Oct 2022 07:00:00 +0000

Meta has gone all-in on the metaverse but how do users and shoppers feel about this virtual future? Martin Gilliard, the Head of Meta Store at Reality Labs at Meta, is helping to make sure that those who step into the metaverse are leaving with a positive experience, and he’s got advice for brands on how to start experimenting and building for more virtual experiences in the future.

Tune in to learn:

Martin’s contrarian belief about the Metaverse (2:00)
What is Martin betting on for the future? (6:00)
What is Meta learning from how customers interact with products (11:20)
What is Meta experimenting with now? (17:10)
When will we see virtual shopping as part of our daily lives? (23:30)

Mentions:

CityDAO

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Learning From Successes and Failures With Mark Edmonson, Chief Marketing Officer of GoGo squeeZ

info@mission.org (mission.org, Mission) — Tue, 11 Oct 2022 07:00:00 +0000

How do you learn from your successes and failures to inform future innovation? Mark Edmonson, Chief Marketing Officer at GoGo squeeZ, gets honest and specific about what is going well, what could have gone better, and what he and his team are learning at GoGo squeeZ. Tune in to hear how he is navigating his new role as CMO, his thoughts on building great culture, and more.

Tune in to learn:

What is working well at GoGo squeeZ (13:30)
What marketing campaigns could have gone better at GoGo squeeZ (15:10)
Current thinking about retail media (25:20)
Building a great culture (29:00)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

A Deep Dive Into NFTs With Avery Akkineni, President of Vayner3

info@mission.org (mission.org, Mission) — Thu, 6 Oct 2022 07:00:00 +0000

There are lots of conflicting views on NFTs and Web3, as well as an onslaught of mixed messaging on the topic from the mainstream media. Avery Akkineni, President of Vayner3, shares her perspective on the NFT market today and how enterprises can navigate the complexities of this new frontier to build brand value.

Tune in to learn:

Some perspective on the NFT market right now and where the space is going (6:25)
Better understanding your customer with the right data (13:40)
An example of a larger enterprise that is exploring NFTs (17:15)
Building community in the Web3 world (21:10)

Mentions:

Gary Vaynerchuck (“GaryV”)
Kevin Rose
VeeFriends
Bobby Hundreds
BFF (Cofounders Jamie Schmdit and Brit Morin)
Ledger Market Pass
“The Network State” (Book by Balaji Srinivasan)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Overcoming Obstacles to Create ‘Organized Gym Bags’ With Caleb Ulffers, Co-Founder and CEO of Haven Athletic

info@mission.org (mission.org, Mission) — Tue, 4 Oct 2022 07:00:00 +0000

How do you overcome resistance when launching a company? Caleb Ulffers, Co-Founder and CEO of Haven Athletic, set out to design, manufacture, and sell “organized gym bags” after experiencing frustrations with his own outdated duffel. Tune in to hear how his team persevered to successfully pre-launch their product.

Tune in to learn:

Caleb’s background (2:00)
The story of Haven Athletic (11:30)
How Caleb and his team overcame resistance while building the company (18:40)
What the Haven launch looked like and where the company is today (24:30)
What Caleb would do differently if he were launching the brand today (34:40)

Mentions:

Peak Design (Peter Dering, Founder and CEO)
"Knocking Out Knock-Offs: A Look at Crowdfunding and Copycats" (Previous Up Next in Commerce episode featuring Peak Design)
Climate Neutral (Peter Dering, Co-Founder)
Outdoor Retailer Event

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Digital Transformations Happening in Healthcare, Manufacturing and Beyond

info@mission.org (mission.org, Mission) — Thu, 29 Sep 2022 07:00:00 +0000

Because technology, platforms, and even customer expectations are changing so quickly, brands are in need of service and IT consulting firms like SoftServe. SoftServe has more than 450 clients around the world and across industries such as healthcare, manufacturing, software and more. Adam Gabrault is the President of Strategic Verticals & Industry Solutions, North America and on this episode, he details some of the challenges SoftServe’s clients are facing, and what kinds of solutions are on the table. Enjoy!

Tune in to learn:

The challenges Adam has faced (2:10)
SoftServe’s roots in Ukraine (7:00)
Adam’s thoughts on A.I. (21:55)
Can we start putting health data on the blockchain? (32:10)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Leveraging Technology in Retail with Jenna Flateman Posner, Chief Digital Officer of SNIPES

info@mission.org (mission.org, Mission) — Tue, 27 Sep 2022 07:00:00 +0000

Can a tech career lead to success in retail? Jenna Flateman Posner, a former professional rugby athlete, is a tech expert turned retailer who is now the Chief Digital Officer of SNIPES, a successful sneaker and streetwear company. Tune in to hear her unique perspective on how to win by utilizing technology in retail.

Tune in to learn about:

Jenna’s experience as a rugby player (2:15)
What Jenna describes as SNIPES’ “hype selling” model (11:30)
About Jenna’s journey from tech to retail (15:00)
How tech investments add incremental value to SNIPES (27:48)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Journey of GOOD PLANeT Foods Part 2: Establishing A Brand in an Expanding Market

info@mission.org (mission.org, Mission) — Thu, 22 Sep 2022 07:00:00 +0000

GOOD PLANeT Foods was established with a mission in mind, but how did that mission end up as products in the hands of consumers? On part two of this two-part episode, we welcome back David Israel, Founder and CEO at GOOD PLANeT Foods, who is joined by his Co-CEO, Bart Adlam, to fill us in on how they built the business and a partnership. Enjoy!

Tune in to learn:

How to walk the fine line when working with a co-CEO (10:50)
What’s the balance between getting the product to market and educating the consumer (12:15)
How GOOD PLANeT Foods is competing against a glut of lower quality products from competitors (15:50)
How, according to Bart, GOOD PLANeT Foods is becoming “a market of one” (27:30)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Journey of GOOD PLANeT Foods Part 1: How David Israel’s Entrepreneurial Spirit Served Him Throughout Many Ups and Downs

info@mission.org (mission.org, Mission) — Tue, 20 Sep 2022 07:00:00 +0000

David Israel has had an incredible journey to where he is now, serving as the Founder and CEO at GOOD PLANeT Foods. In part one of this special two-part episode of Up Next in Commerce, hear David’s backstory, including a long, drawn-out legal battle and creating a business from behind bars and growing it into a leader in the snack category. And tune into the next episode to hear more about GOOD PLANeT Foods.

Tune in to learn:

David’s journey through legal battles (6:30)
Running a business while in legal limbo (9:20)
How David found the idea for POP! Gourmet Foods in prison (23:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Dissecting the Second Edition State of Commerce Report

info@mission.org (mission.org, Mission) — Thu, 15 Sep 2022 07:00:00 +0000

In the ever-evolving world of ecommerce, brands are constantly looking for data and resources to help them carve out a path forward. Salesforce wants to be that font of information for brands, and it’s delivering valuable insights via the Second Edition State of Commerce Report. On this episode, Caila Schwartz, the Director of Industry Insights at Salesforce, digs into some of the report’s findings and provides some tips and predictions for how brands should handle the holiday season.

Tune in to learn:

What has been most surprising when compiling the report (2:20)
Brands and trends to watch in the automation space (12:06)
How to think about the holiday season (16:33)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Powering A Brand and The Human Body with Soylent CEO Demir Vangelov

info@mission.org (mission.org, Mission) — Tue, 13 Sep 2022 07:00:00 +0000

Finding passionate customers and engaging with them regularly is like the quest for the holy grail for most brands. Soylent has been successful in its efforts, but it hasn’t always been easy. On this episode, Demir Vangelov, the CEO of Soylent, recalls the complete rebranding process the company went through and how it’s evolved since. Enjoy!

Tune in to learn:

Acquisition tactics to consider (9:13)
How to think about your brand to become more approachable (11:55)
Some intriguing platforms and areas of engagement (14:50)
The Soylent retail strategy (20:20)
What does Soylent do to delight retailers it works with? (23:45)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Advice From a Replatforming Pro With Rob Johnson of Wyze

info@mission.org (mission.org, Mission) — Thu, 8 Sep 2022 07:00:00 +0000

Replatforming to increase ROI and the customer experience is often an essential task for an ecommerce business. Rob Johnson, Principal E-Commerce Technical Program Leader at Wyze, describes implementing this change at a business with a long history and a younger company. Also, tune in to learn about how Wyze is integrating software and hardware solutions with its products.

Tune in to learn:

How the media landscape has evolved (5:50)
What the replatforming process was like for Rob (13:30)
What mindset shift was necessary for Rob when moving to a young company (24:20)
What projects Rob is working on (31:10)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Team and Brand Building With Sean Moriarty of Leaf Group

info@mission.org (mission.org, Mission) — Tue, 6 Sep 2022 07:00:00 +0000

After building brands, teams, and customer bases at companies like Ticketmaster and Saatchi Art, Sean Moriarty was the perfect person to lead Leaf Group as it amassed its portfolio of leading digital brands. On this episode, Sean discusses some of the lessons he’s learned and divulges how he’s helping Leaf Group’s brands experiment in an evolving digital world.

Tune in to learn:

Building the Ticketmaster platform (7:00)
Lessons learned from earlier times about team building (8:30)
What kind of opportunities are available for brands today within holding groups? (25:00)
What commonalities exist across brands? (28:30)
How to encourage experimentation while also providing proven best practices (30:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Solving Retention Issues and Amazon-Proofing Your Business with Joe Fisch of Wine Access

info@mission.org (mission.org, Mission) — Thu, 1 Sep 2022 07:00:00 +0000

As the CEO of Wine Access, Joe Fisch is constantly trying to solve hard problems… like predicting the weather? On this episode, Joe explains how he and his team have worked to address all kinds of issues, from customer retention to access to exclusive supply, to, yes, forecasting the weather to optimize the supply chain. Enjoy!

Tune in to learn:

How to overcome apprehension when moving up the corporate ladder (11:30)
Figuring out the components behind losing customers (15:15)
Content strategy for educating consumers (22:50)
Behind-the-scenes stories about finding great wine (25:25)
Supply chain and the weather (32:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

How Getty Images is Developing The Future of Visuals

info@mission.org (The Mission, Mission.org) — Tue, 30 Aug 2022 07:00:00 +0000

Finding the best visual companion to your content is often a tough task. Getty Images has been making it easier for brands and individuals for decades. On this episode, Grant Farhall, Chief Product Officer at Getty Images, dives into the predictive trends that can be found within its search tool, plus he answers questions about how the backend search engine actually works (without giving away too much of the secret sauce of course) and how Getty is prepping for a future that’s going all-in on video and the metaverse.

Tune in to learn:

Trends in the visual and image search realm (11:00)
How to present the best visual options to customers (7:55)
Best practices with visuals and data (17:40)
Why video and the metaverse are channels to keep your eye on (29:36)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Making Messaging Matter: How Brands Can Win with SMS

info@mission.org (mission.org, Mission) — Thu, 25 Aug 2022 07:00:00 +0000

SMS messaging is a valuable channel for brands that know how to use it. Attentive is helping them figure it out. Brian Long, the CEO and co-founder of Attentive, joins this episode to discuss some of the metrics that matter, best practices, and more that brands should know when going down the SMS road.

Tune in to learn:

The latest in the world of branded text messaging (6:25)
How Attentive is bringing a personal touch to texting (12:40)
How brands are innovating with their text tactics (15:10)
Which metrics should brands focus on when it comes to SMS (16:10)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Turnaround Guy: How Pete Gibson Became the IT Fixer

info@mission.org (mission.org, Mission) — Tue, 23 Aug 2022 07:00:00 +0000

Is your business operating at its full potential? Pete Gibson, the former CIO of Friendly's and Johnny Rocket’s restaurants has built a reputation going from company to company improving overall functionality and increasing revenue. Learn how he uses technology and team-building strategies to maximize IT output and why his nearly 15-year military background has proven useful in his professional career.

Tune in to learn:

Pete’s military background (2:40)
Some case studies from Pete’s private sector experience (11:50)
Pete’s approach to a company audit (18:05)
Peter’s take on today’s IT environment (34:00)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Career Strategy and Business Agility With Mary Lou Gardner, Associate Partner at Infosys Consulting

info@mission.org (mission.org, Mission) — Thu, 18 Aug 2022 07:00:00 +0000

With so much flux in the world, how can we guide workers and businesses through the chaos? Mary Lou Gardner, Associate Partner at Infosys Consulting, helps workers and companies see their way to desired outcomes. Tune in to hear more from Mary Lou on how businesses can think outside the box, shore up their supply chains, and succeed with nimble strategies.

Tune in to learn:

How to make meaningful career changes (6:55)
The importance of visual display and assortment optimization strategies (26:50)
How companies are working with competitors? (33:00)
Trends in the retail industry (35:30)

Mentions:

Blue Yonder
“Solving the World’s Supply Chain Woes with Blue Yonder” (Up Next in Commerce episode)
Capsule
“Reimagining Pharmacies and Healthcare with Eric Kinariwala, CEO of Capsule” (Up Next In Commerce episode)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Creating Amazing Experiences Inside Of Five Below and Beyond

info@mission.org (mission.org, Mission) — Tue, 16 Aug 2022 07:00:00 +0000

Effective ecommerce strategies are crucial for just about every business these days. However, Felipe Zardo, SVP of Digital at Five Below, explains that they shouldn’t overshadow all the other methods brands use to connect to customers and satisfy their needs. On this episode, Felipe discusses how Five Below creates great experiences across all customer interactions with the brand and what new initiatives are coming soon.

Tune in to learn:

How Felipe became involved in the retail industry (3:30)
Strategies for measuring the performance of large-scale marketing efforts (5:50)
How to find the right blend of marketing and consumer outreach (10:35)
How Five Below creates a magical in-store experience (13:00)
Everything you need to know about inventory management and fast shipping (15:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

All About Exits: Understanding and Achieving Success When Exiting a Start-up

info@mission.org (mission.org, Mission) — Thu, 11 Aug 2022 07:00:00 +0000

When it comes to start-up acquisitions, Touraj Parang is in a class of his own. He has both helped companies exit and has been on the acquirer side of deals throughout his many years in Silicon Valley. On this episode, he talks about the lessons he’s learned along the way and gives acquisition advice to start-up founders who are just entering this playing field.

Tune in to learn:

Touraj’s fascinating Silicon Valley background (2:10)
What to do when an acquisition offer comes through (18:30)
What do founders forget to prepare for? (27:10)
A story from an acquisition that didn’t go well (30:10)
What’s one topic that didn’t make it into Touraj’s book (38:35)

Mentions:

Exit Path: How to Win the Startup End Game

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Growth Advice From a Seasoned Food Business Leader

info@mission.org (mission.org, Mission) — Tue, 9 Aug 2022 07:00:00 +0000

Joining the podcast today is a very experienced leader in the food business, Bryan Freeman, whose previous posts include CEO at Better Bakery LLC and President of SnackWorks LLC. Now the Executive Chairman at the low-carb, high-protein frozen food maker Real Good Foods, Bryan talks about taking the company public and the recipe for lasting growth. Enjoy!

Tune in to learn:

The story of Real Good Foods (4:30)
Bryan’s experience taking Real Good Foods public (16:00)
Bryan’s views on building a good board (19:14)
Advice for new founders (34:40)

Mentions:

Dr. Rhonda Patrick
Bert Dohman, founder of Dohmen Capital Research (offers analysis for investors and traders)
“The All-In Podcast”

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

No One’s Passing This Buck: Buck Mason’s Marketing and DTC Strategies Explained

info@mission.org (mission.org, Mission) — Thu, 4 Aug 2022 07:00:00 +0000

Buck Mason brings an enduring design flair to its products, but that’s not where its everlasting concepts end. Jim Davis, the Chief Customer Officer at Buck Mason, discusses how traditional marketing ideas like catalogs and direct mail can still be difference makers for DTC. Tune in as he also dives into what the future will hold for emerging brands.

Tune in to learn:

Jim’s thoughts on direct mail (8:20)
How to make brands cool again (15:20)
An evaluation of the current DTC landscape (22:40)
Some advice for young brands on their go-to-market strategy (25:40)
Where to invest marketing dollars (42:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Resetting To Find a New Career Passion With Brian Seewald, SVP of eCommerce at Express

info@mission.org (mission.org, Mission) — Tue, 2 Aug 2022 07:00:00 +0000

What if you learned what you thought was your career passion was not your heart’s desire? Brian Seewald, the SVP of eCommerce at Express, reset and found a true affinity for retail generally and, ultimately, ecommerce. Tune in to hear from Brian about how Express offers its customers “personalization, [an] omnichannel experience, styling and fit, and community.”

Tune in to learn:

Evaluating the Express retail and ecommerce strategies (13:20)
Express’ digital plan for customers, including its mobile app (17:00)
New platforms for shopping including livestreams, Instagram, and more (29:30)

Mention:

“Don't Make Me Think: A Common Sense Approach to Web Usability” by Steve Crug

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Dos and Don’ts for Ecommerce Brands Large and Small

info@mission.org (mission.org, Mission) — Thu, 28 Jul 2022 07:00:00 +0000

Ellis McCue has a long resume that has taken her through the world of ecommerce, supply chain, and venture capital. Now, she is the CEO of Territory Foods, where she is trying to make the world better one meal at a time. Hear all about it on this episode.

Tune in to learn:

How to understand consumer behavior from the front lines (16:00)
How a “mortality moment” shifted Ellis’s perspective (29:00)
How Territory foods found the right focus (38:00)
How to keep track of a distributed network (44:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Faherty’s Evolution From Idea to Consumer Favorite

info@mission.org (mission.org, Mission) — Tue, 26 Jul 2022 07:00:00 +0000

The Faherty brand started as an idea in an essay, but twin brothers Alex and Mike Faherty turned it into a reality with strategic experience, experimental ideas, and through the power of storytelling. Alex joins the podcast today to take us through the entire journey. Enjoy!

Tune in to learn:

The growth of the Faherty brand (7:10)
How Faherty found and built partnerships with retailers (9:20)
How Faherty utilizes storytelling (15:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Magic of A Powerful Story With Wunderkeks Co-founders, Hans Schrei and Luis Gramajo

info@mission.org (mission.org, Mission) — Thu, 21 Jul 2022 07:00:00 +0000

Hans Schrei and Luis Gramajo were told that the world didn’t need another cookie company, but they persevered and have found success with their brand, Wunderkeks. On this episode, they share how they went from Hans’ mother’s kitchen in Guatemala to exploding onto the scene in Austin, Texas, and becoming media and celebrity darlings.

Tune in to learn:

How Wunderkeks brand achieved clarity in the US (7:18)
How Wunderkeks became an ecommerce business (10:10)
The Wunderkeks approach to acquiring new customers (13:36)
How Hans and Luis learned the power of storytelling (17:30)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

A Platform for Parents: How Fatma Collins and Julie Rogers Built Ten Little

info@mission.org (Mission.org) — Tue, 19 Jul 2022 07:00:00 +0000

Fatma Collins and Julie Rogers met while they were pregnant with their first kids and when they found they were both struggling to find products and resources for their children, they decided to do something about it. They began Ten Little based on one central conviction: “Parenting is hard, but shopping for your child shouldn’t be.” How did they create a platform that simplified the buying experience for parents everywhere? Find out on this episode!

Tune in to learn:

How the Ten Little platform evolved (5:55)
How Ten Little found its first customers (15:00)
Some upcoming opportunities Ten Little is exploring (19:45)
Trends to get excited about in the commerce space (30:20)

Mentions:

Soles4Souls

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Mint Mobile’s Approach to Funny Ad Campaigns with Ryan Reynolds, Consumer Psychology, and Customer Acquisition

info@mission.org (mission.org, Mission) — Thu, 14 Jul 2022 07:00:00 +0000

Sure, Mint Mobile benefits from having the star power of part-owner Ryan Reynolds in its back pocket, but Kenny Smithnanic, AVP, e-Commerce at Mint Mobile, explains how the brand’s success goes far beyond Ryan’s charm. Tune in to find out how Mint Mobile is achieving exponential growth, and what role consumer psychology plays in Kenny’s methods and strategies.

Tune in to learn:

Ryan Reynolds’ role at Mint Mobile (2:10)
How Kenny became interested in the psychology behind marketing (14:45)
Helpful resources on human psychology (22:00)
What does it look like to be a good manager? (25:10)
Why Kenny is paying attention to quizzes (27:25)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Why DTC Goes Beyond the Dot Com with Carter Jensen of General Mills

info@mission.org (mission.org, Mission) — Tue, 12 Jul 2022 07:00:00 +0000

Gushers in the metaverse and Dunkaroo NFTs? When it comes to DTC experiences, General Mills is not playing it safe. On this episode, Carter Jensen, the Senior Manager of Global eCommerce at General Mills, discusses how his small but mighty team is creating DTC experiences that go beyond simple transactions on a website.

Tune in to learn:

The future of DTC for brands within General Mills (5:45)
What General Mills is investing in now (21:05)
How to create a good Tik Tok experience for customers (24:35)
The General Mills brands exploring NFTs and the metaverse (28:28)

Mentions:

Scott Galloway

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

The Evolution of Platform Businesses and The $6T Industry Ripe for Disruption

info@mission.org (mission.org, Mission) — Thu, 7 Jul 2022 07:00:00 +0000

Big tech platforms like Amazon have been dominating the industry for a while, but what will the future hold? How can smaller B2B platforms and brands win and compete when monopolies are controlling the game? Alex Moazed, Founder & CEO of Applico and the co-author of the book, Modern Monopolies, breaks it down on this episode.

Tune in to learn:

How business models have evolved over the last 25 years (2:10)
What is the future business model for platforms? (8:40)
Platform opportunities for founders to take advantage of (17:00)
How can B2B marketplaces disrupt distributors? (28:40)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Cracking The Code To Growth and Scale

info@mission.org (mission.org, Mission) — Tue, 5 Jul 2022 07:00:00 +0000

Is a good idea or useful product enough to launch a company? Not according to David Rabie, the Founder and CEO of Tovala. He learned that lesson the hard way. From its humble beginnings to a top-ranked home-cooked meal delivery service, Tovala now ships more than 100,000 meals every month and is finding success on multiple platforms. What has David learned along the way? Find out on this episode!

Tune in to learn:

What is Tovala? (6:55)
How did Tovala crack the code for growth? (13:00)
What is it like to be featured on Oprah’s favorite things list? (21:00)
Where to find new customers (22:55)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

What Brands Should Know About The Retail Media Landscape

info@mission.org (mission.org, Mission) — Thu, 30 Jun 2022 07:00:00 +0000

Amazon has been a giant in the ecommerce retail media world for years. Ideoclick is guiding brands through that landscape and Anne Zybowski, Vice President of Strategy and Client Development at Ideoclick, is helping lead the way. She explains it all on this episode.

Tune in to learn:

A high-level look at the world of retail media (13:18)
How to invest in foundational aspects that are important now versus building for and betting on the future (21:15)
What impact will the metaverse have on brands? (24:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Everything You Need to Know about Web 3 and NFTs

info@mission.org (mission.org, Mission) — Tue, 28 Jun 2022 07:00:00 +0000

There has been buzz around web 3 and NFTs for a while, but are they useful for your brand? Roger Beaman of Novel, is the man with the answers! Novel is making web 3 accessible for brands everywhere. So if you’ve been waiting for a web 3 and NFT explainer, the wait is over, everything you need to know is right here!

Tune in to learn:

The difference between Web 1, Web 2, and Web 3 (20:10)
How can brands utilize Web 3? (25:00)
Breaking down the ways brands can utilize Web 3 and NFTs (31:20)
How much of what’s happening now will endure long term? (45:40)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Why Web3 Is The Way Forward With Marc Mathieu of Salesforce

info@mission.org (mission.org, Mission) — Thu, 23 Jun 2022 07:00:00 +0000

Marc Mathieu, the Co-Founder of Web3 Studio at Salesforce, discusses how web3 will change how brands acquire and interact with consumers. Plus, he explains the hype around NFTs and digital goods – whether they are trends to watch or fads that will fade – and the mindset shifts that need to happen to get the most out of them.

Tune in to learn:

Key moments in internet history: from the invention of the cookie to the shift toward first-party data (6:00)
How to find customers in a new digital world (8:45)
Why your brand is your community and how to keep your community the right size (11:00)
What commerce companies should be most excited about when it comes to web3 (23:15)
Digital goods — Are they a fad, trend, or long-term opportunity? (27:25)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Shipping Solutions with Laura Behrens Wu of Shippo

info@mission.org (mission.org, Mission) — Tue, 21 Jun 2022 07:00:00 +0000

There are many shipping solutions available to brands today, but are any of them truly easy to use, transparent, and scalable? Laura Behrens Wu couldn’t find one, so she and he business partner built it themselves. Now, their company, Shippo, is valued at more than $1 billion, has thousands of customers, and is making shipping easier for all kinds of brands. How? Find out on this episode.

Tune in to learn:

Why Laura rejected feedback she got from Y Combinator (6:35)
Behind the scenes of how Shippo actually works (10:50)
Is free two-day shipping necessary? (24:30)
How do you innovate and bring the tech stack to the next level? (29:15)

Mentions:

Shoe Dog

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

How Retail Keeps Reinventing Itself

info@mission.org (mission.org, Mission) — Thu, 16 Jun 2022 07:00:00 +0000

Retail is not dead, in fact, all signs point to the fact that retail is on the rise. But the retail experience isn’t going to be what it has always been in the past. The world of retail is evolving, and brands of all kinds are trying to find the best ways to give their customers what they want and need across channels, including in stores. Anjee Solanki, the National Retail Director for the USA at Colliers, has an inside look at what this next evolution will look like, and she shared her insights on this episode.

Tune in to learn:

What is the state of retail today? (11:10)
How should retail evolve to meet consumer expectations? (19:10)
Breaking down innovative (28:20)
How Asia’s efforts might be adopted elsewhere (35:20)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

The Supply Chain Answers You Crave with Anthony LaGrasso of Levain Bakery

info@mission.org (mission.org, Mission) — Tue, 14 Jun 2022 07:00:00 +0000

The phrase “supply chain issues” has become a bit of a punchline, but very few people seem to know the real story of what’s going on behind the scenes. Anthony LaGrasso is one of them. As a veteran in the world of supply chain and in his current role as VP of Supply Chain at Levain Bakery, Anthony has had an insider's view of what’s going on… and what innovations are needed to get ahead. Hear all about it on this episode.

Tune in to learn:

Creating Levain’s supply chain from the ground up (10:30)
How can you innovate in the supply chain? (20:55)
A checklist for finding the right suppliers to work with (25:50)
Why are we still having supply chain issues? (27:35)
What kind of technology investments can be made to remedy supply chain problems? (32:20)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Creating True Omnichannel and DTC Experiences For Brands Like Oreo and Sour Patch Kids

info@mission.org (mission.org, Mission) — Thu, 9 Jun 2022 07:00:00 +0000

Omnichannel operations are becoming more important than ever, especially for large companies like Mondelēz International, which owns some big-name brands that sell across channels. Wherever and however you’re buying Oreos or Sour Patch Kids or any of the dozens of other Mondelēz International brands, Francesca Hahn wants to make sure that the experience is the best it can be. How does she do it and where does social commerce enter the mix? Find out on this episode.

Tune in to learn:

Why Mondelēz shifted toward DTC why it needs to be a truly extraordinary experience (7:50)
Lessons learned creating a DTC Oreo experience (9:50)
13:00: How to look at retail and create solid retail partnerships (14:30)
Measuring ROI in the ecommerce industry (17:30)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

How To Engage With Customers On Youtube, Amazon, In-Store, and Beyond

info@mission.org (mission.org, Mission) — Tue, 7 Jun 2022 07:00:00 +0000

Brands want to be everywhere all at once, but very few do that well. Chemical Guys has cracked the code on what it truly means to be an omnichannel brand, but the company has also uncovered some of the secrets of Amazon, franchise models, and growing a content platform across multiple channels. John Mansfield, the Chief Revenue Officer at Chemical Guys, takes us through all of that on this episode.

Tune in to learn:

What does it mean to be truly omnichannel? (10:00)
The Amazon difference and why you shouldn't try to compete with it (13:00)
How to enforce your pricing policy and what tools are most effective (15:15)
Some of the secrets to building an engaged community (25:40)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Making Speed A Top Priority With Lee Hnetinka of FastAF

info@mission.org (mission.org, Mission) — Thu, 2 Jun 2022 07:00:00 +0000

Lee Hnetinka believed in the idea of having products delivered to customers in minutes, so he built the company and the platform to make it happen. That company is FastAF and since launching, Lee has been able to get some major brands onto the marketplace that offers one of the biggest differentiators in the game: speed. How? Find out on this episode.

Tune in to learn:

Why curation and personalization mean the same thing and how to create a personalized platform (11:20)
Unlocking the key to customer acquisition (17:30)
How to bring people back to events (23:30)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

From Athlete to Entrepreneur With Laura Xiao of Henné Organics

info@mission.org (mission.org, Mission) — Tue, 31 May 2022 07:00:00 +0000

Businesses are built by all kinds of people who bring all different strategies to the table. Laura Xiao’s journey started in the sports world and from there she grew into an entrepreneur who is now the Founder and CEO of Henné Organics. What did Laura take from her experience as an athlete to help her grow her brand? And how is she overcoming obstacles now? Find out on this episode.

Tune in to learn:

Should your life partner be your business partner? (18:00)
Practicing mindful negative visualization (20:25)
Overcoming obstacles when building a business (27:00)
Being open but cautious with opportunities (28:30)
Secrets to gaining traction in a crowded market (35:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Fighting Back Against Fake Reviews with Carolyn Jameson of Trustpilot

info@mission.org (mission.org, Mission) — Thu, 26 May 2022 07:00:00 +0000

Every second a new review comes into Trustpilot, the consumer review website that is helping brands and consumers harness the power of feedback. On this episode of Up Next in Commerce, Carolyn Jameson, the Chief Trust Officer at Trustpilot, discusses how the company is creating an open, holistic, transparent experience for everyone so that consumers can trust the brands they engage with, and brands can connect with their customers and improve their businesses using authentic feedback.

Tune in to learn:

The components needed to build trust and fight fake reviews (5:45)
Why the best companies aren’t the ones with five stars (7:30)
How to encourage customers to leave authentic reviews (9:00)
Using reviews to help identify trends and patterns in consumer behavior (13:20)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Reimagining Pharmacies and Healthcare with Eric Kinariwala, CEO of Capsule

info@mission.org (mission.org, Mission) — Tue, 24 May 2022 07:00:00 +0000

The ecommerce world has gone through many evolutions, but there are certain industries that still remain woefully in the analog world. Healthcare is one of them, but Eric Kinariwala, CEO of Capsule, says that won’t be the case for long. Capsule has built an entirely new, digital-first way to make better decisions surrounding your health, and Eric says that was just the first step. Hear what’s next on this episode.

Tune in to learn:

What does it take to change healthcare? (4:00)
Why has it taken so long to solve the problems in the pharmacy industry? (10:00)
What does the future of pharmacies look like? (15:00)
How to think about positioning a brand to be experiential (20:00)
Where will automation play a role and how will humans blend with technology? (23:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Visual Commerce is Coming, and Threekit is Making it Possible

info@mission.org (mission.org, Mission) — Thu, 19 May 2022 07:00:00 +0000

Brand websites are often pretty similar — there are product pages, pictures, carousels, maybe even videos. That’s worked for a while, but Matt Gorniak, the CEO of Threekit, says it’s time to up the ante. Threekit is creating a whole new category for brands who want to get into visual commerce and bring 3D and AR into the fold. Matt talks about what that looks like on this episode.

Tune in to learn:

How do you get the most out of visual commerce? (9:00)
Rethinking what the virtual commerce experience will look like (12:00)
What’s going on with NFTs (20:40)
How do you measure the ROI of your visual commerce investments? (25:40)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

A Front Row Seat To Gen Z and the Biggest Brands in the World

info@mission.org (mission.org, Mission) — Tue, 17 May 2022 07:00:00 +0000

The world is changing at a pace that’s hard to keep up with. So, what a student learns to earn a degree is quickly becoming obsolete. That’s true unless you’re in Anika Sharma’s class. Anika is a professor of business and technology at NYU Stern School of Business, and she is also a General Manager and Global Client Partner for Mindtree. By having her feet in both worlds, Anika sees how Gen Z is changing in real-time and understands what brands are asking for on a day-to-day basis. She then shares that information in educational and business settings. She shared it with us, too, on this episode.

Tune in to learn:

How Anika brings the classroom to clients at Mindtree (7:30)
Trends larger brands are looking for help with (10:50)
Getting more to the heart of why companies fail and what we can learn from them (30:30)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Talking TV, Streaming, and Segmentation with Fariba Zamaniyan of Xperi Corporation

info@mission.org (mission.org, Mission) — Thu, 12 May 2022 07:00:00 +0000

Although you might think of TiVo as the DVR of days gone by, the brand is still having an impact. These days, TiVo is part of Xperi Corporation, and the data that the company gathers is making it possible for brands to understand their customers better as it relates to TV and streaming advertising. Fariba Zamaniyan, the Vice President, Advanced Media and Advertising at Xperi Corporation, discusses that and more on this episode.

Tune in to learn:

Understanding the landscape of TV advertising (7:25)
Taking control and bringing tech in-house to harness the power of digital (10:00)
Will Nielsen be prominent in the future? (16:50)
What are brands doing today that is actually working when it comes to assessing consumer behavior? (22:20)
How should brands think about segmenting customers to ensure the most success? (29:20)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Mindset Shifts for Upskilling, Hiring, Partnerships and More with Diana Haussling of Colgate-Palmolive

info@mission.org (mission.org, Mission) — Tue, 10 May 2022 07:00:00 +0000

How you go about doing something is the greatest indicator of success. For Diana Haussling of Colgate-Palmolive, instituting the right mindset for all of her employees, partners, and vendors is step one in the recipe for success. Whether it’s upskilling your employees, hiring new talent, or partnering with agencies or vendors, Diana believes how you think about the situation and your approach to it will make all the difference.

Tune in to learn:

Guiding principles on creating a good group/network (3:40)
How to think about upskilling and hiring new talent (7:50)
What it takes to train a team to think like a consumer (15:00)
Finding partners to study consumer behavior (18:00)
How do you pick a good agency, partner, or vendor to work with? (20:55)
What’s happening in the world of retail media? (23:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

From Lawnmower Tech to Mobile Remote Controlled Robot Stores With Dmitry Shevelenko, Co-Founder and President of Tortoise

info@mission.org (mission.org, Mission) — Thu, 5 May 2022 07:00:00 +0000

How did technology for a lawnmower operated by remote control end up leading to mobile robot stores? Dmitry Shevelenko, Co-Founder and President of Tortoise, explains how his company landed on creating an original product — a mobile vending machine — while concentrating on last-mile delivery. He also shares how his passion for anthropology and how people behave has been a key driver in understanding customers’ behaviors to increase revenue.

Tune in to learn:

How can great ideas be uncovered by analyzing consumer behavior? (17:00)
What’s Tortoise like in action? (21:00)
How do you build a moat around your company? (27:00)
Will mobile stores shift how retailers think about selling products? (33:00)
How can last-mile challenges be solved once and for all? (40:15)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Personalizing Experiences and Building Communities with Nick James of Blue Buffalo

info@mission.org (mission.org, Mission) — Tue, 3 May 2022 07:00:00 +0000

People love their pets. That’s a universal truth that Nick James uses as his north star while working as the Senior Director of Consumer Experience at Blue Buffalo. That’s where the universality ends, though. Pet parents, just like consumers in all industries, are individuals with specific needs, and brands have to create experiences and implement technology to make every customer journey as personal as possible. Here, Nick explains what that personalization looks like at Blue Buffalo.

Tune in to learn:

Why the future of commerce is universal commerce (2:00)
Who and what is driving the pet industry more toward ecommerce? (14:00)
20:00:Working behind the scenes for a new kind of buyer (20:00)
30:00: Personalizing efforts around big events (24:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Can A Robot Help Make You A Better Burrito? Nicole West of Chipotle Has The Answer

info@mission.org (mission.org, Mission) — Thu, 28 Apr 2022 07:00:00 +0000

When you think about quick-service restaurants like Chipotle, you might not always think they are on the cutting edge of innovation. But Nicole West, the VP of Digital Strategy & Product at Chipotle, says that’s not the case. In fact, Chipotle is making investments in robotics and AI in incredible ways to create the best possible experience in-store, online, and at all digital touchpoints. How? Find out on this episode.

Tune in to learn:

How to tackle personalization at scale (8:00)
Collaborative robotics and driving efficiencies (10:20)
Building a very conversational collection of bots to get customers what they need (15:50)
How customers interact with brands and how to understand what they expect (25:20)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at http://www.mission.org.

Where and How Telcos Like Lumen are Meeting Customers’ Needs

info@mission.org (mission.org, Mission) — Tue, 26 Apr 2022 07:00:00 +0000

Delivering what your customers want and need seems like an obvious thing for a company to do. But when there is so much new technology to experiment with and alternate roads to go down, it’s easy to get off track. Jon Luciano, Director of Ecommerce for Lumen, discusses how Lumen stays the course, and how and why telcos and other industries can invest in new opportunities in a way that allows them to succeed.

Tune in to learn:

Why to get excited about the technology behind NFTs (2:00)
Will marketplaces be the future for telcos? (9:25)
Why to bet on personalization (14:55)
What metrics to look at to know if your personalization techniques are working well (17:10)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Fighting Through Debt and Winning on Amazon with MaryRuth Ghiyam of MaryRuth Organics

info@mission.org (mission.org, Mission) — Thu, 21 Apr 2022 07:00:00 +0000

What’s the secret to building a $100-million-dollar brand? MaryRuth Ghiyam has done it, so she knows the answer pretty well. And it turns out, it’s pretty simple: make something people need and do it in a way that is sustainable. Easier said than done, right? Luckily, MaryRuth broke down what that entails on this episode

Tune in to learn:

The art of reverse engineering your product. (5:50)
Debt and how to get out of it. (12:00)
Sound business building principles and why revenue and profits equal free will. (16:00)
Building on Amazon. (20:20)
A deep dive into product development — and when to kill a product. (29:00)

Mentions:

MaryRuth Organics

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

How BIC is Writing Its Omnichannel Strategy

info@mission.org (mission.org, Mission) — Tue, 19 Apr 2022 07:00:00 +0000

In the same way that the pen is mightier than the sword, the omnichannel approach is superior to throwing all your eggs in either the digital or in-person baskets. At BIC, Jennifer Elmashni, Vice President, Global eCommerce and Digital Marketing, breaks down how the global brand is building community, engaging in B2B and D2C strategies, and experimenting anywhere and everywhere in order to stay on top, including exploring how other countries are using digital influencers and scaling last-mile delivery.

Tune in to learn:

How to get to a place of anticipation (8:00)
What it takes to develop an engaged community (11:50)
How to reengage customers in an omnichannel way. (15:55)
Understanding global scale and where to look around the world for trends. (21:00)
How to think about branded content and partnerships. (29:00)
Digital shelf tracking and insights deriving mechanisms help you create the flawless digital experience. (33:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

How To Get The Most Out of Affiliate Marketing with Tyler Grooms of Sweetwater

info@mission.org (mission.org, Mission) — Thu, 14 Apr 2022 07:00:00 +0000

Brands know that word of mouth is one of the most effective ways to acquire customers, but how do you create the kind of chatter you actually want? What do you need to do to find and use influencers, content creators and affiliate marketing in order to give your customers what they want most? Tyler Grooms, Director of Engagement Marketing at Sweetwater, provides answers on this episode.

Tune in to learn:

How can you make an affiliate program into a powerhouse? (2:40)
What should brands avoid when working with content creator partners? (8:30)
How to find the right content creators to partner with (10:55)
Finding and hopping on opportunities (23:00)
The shifting strategy of Sweetwater (24:00)
Taking on more upfront cost to serve customers better. (25:57)

Mentions:

Ridge Wallet Episode of Up Next in Commerce

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Why Marketing and Ecommerce Go Hand-in-Hand If You Want to Increase Your Digital Prowess

info@mission.org (mission.org, Mission) — Tue, 12 Apr 2022 07:00:00 +0000

Can something as small as changing the color scheme on your website lead to exponential growth? Well, it’s not quite that simple, but according to Sheila Erickson, Vice President, Marketing and E-Commerce at Slumberland Furniture, making basic, obvious changes is the key to unlocking a much larger opportunity to grow in all areas.

Tune in to learn:

What it takes to grow ecommerce sales and conversion rates. (2:00)
How to implement a test-and-learn strategy. (4:00)
How to connect to a younger generation or a new demographic. (10:15)
What kinid of tech stack works best and how does it lead to more data and insights? (13:10)
How should smaller companies be thinking about research and growth opportunities? (20:00)
What’s overhyped or underhyped in the digital world? (34:30)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

Why Less is More for Last Crumb

info@mission.org (mission.org, Mission) — Thu, 7 Apr 2022 07:00:00 +0000

If I told you that you could get the Rolex of cookies delivered to your door, would you be interested in that? Matthew Jung certainly was, and that’s why he went to work for Last Crumb, and since he joined the company, it’s become one of the hottest DTC brands with a waitlist about a mile long. What was the secret to creating a massively in-demand product (other than delicious cookies of course)? Find out right here.

Tune in to learn:

How to identify your core values and set priorities as a brand. (9:30)
Why would you depprioritize popular channels? (11:00)
Is email still important? (15:45)
The most interesting things about SMS. (17:50)
The magic behind Last Crumb’s organic growth. (20:25)
Even if you think you have a great unboxing experience, you’re wrong. (25:00)
How do you differentiate yourself from the rest of the brands in your category? (30:00)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at http://www.salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

http://www.mission.org.

What Does The Future Hold And How Should Brands Prepare?

info@mission.org (mission.org, Mission) — Tue, 5 Apr 2022 07:00:00 +0000

The buzz around Web. 3.0, NFTs, and the metaverse is undeniable, but how much should brands actually be paying attention to? And where will brands and consumers actually get the most out of these trends? We asked Taylor Holiday, the CEO of Common Thread Collective, those questions and more on this episode.

Tune in to learn:

Facing the future and what’s exciting about the years ahead. (4:35)
What’s the deal with NFTs? (6:20)
Brands need to deliver for both our physical and digital worlds. (11:00)
What people miss about Facebook/Meta. 29:00)
How do you think of Web 3.0? (34:20)
The most contrarian opinion about the ecommerce world. (42:00)
What disiruptions are coming to the supply chain next? (50:45)

Mentions:

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

Increase Conversion, Reduce Churn and Colonize Mars? Tips for Ecommerce Brands from Drew Himel of Consult PCR

info@mission.org (mission.org, Mission) — Thu, 31 Mar 2022 07:00:00 +0000

In this day and age, are ecommerce brands still making basic mistakes? Yes, and there are a lot of small ways to improve your business that are ignored in favor of the shiny new object. Drew Himel, the Founder and CEO of Consult PCR, is here to help you focus on what really matters, improve retention, reduce churn, and make your business more resilient.

Tune in to learn:

How Drew’s business grew to work with brands like IBM, Lyft, GoPro, and more. And why was that bad? (4:30)
What brands can do right now to get better. (7:45)
How to find easy ways to reduce friction on your website and what meaningful gains that will lead to. (14:00)
Are subscription programs here to stay? (15:30)
What two changes helped MUD/WTR reduce churn? (18:30)
How to build resiliency in your business. (26:00)
Why it’s exciting to be an early investor in new ideas and companies. (38:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

The Innovation Stack: How Square Co-Founder Jim McKelvey Thinks About Disruption

info@mission.org (mission.org, Mission) — Tue, 29 Mar 2022 07:00:00 +0000

When Jim McKelvey and Jack Dorsey were building Square, they were met with legal issues, major challenges from Amazon, and more. But necessity is the mother of innovation, and anger is the fuel that kept Jim going. Hear the lessons Jim and Jack learned and where Jim thinks the world of content is headed on this episode.

Tune in to learn:

How did Square beat Amazon? (2:00)
How did Jim and Jack Dorsey build Square? (6:00)
How do you create the idiot-proof inbox? (11:00)
Is a newsfeed just a digital feedlot? (15:015)
Can you incentivize good content and, as a result, save journalism? (20:00)
How should we think about de-centralized systems and why is it good to have rules and regulations? (25:12)
What’s the first step to disruption? Anger (34:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

Not Dumbing It Down: DECIEM and the Art of Straightforward Marketing with Jordanne Dyck

info@mission.org (mission.org) — Thu, 24 Mar 2022 07:00:00 +0000

If it seems like DECIEM is a different type of beauty brand, that’s because it is. The company behind global powerhouses like “The Ordinary” is more focused on education than manipulation. On today’s episode, we talk with Jordanne Dyck, DECIEM’s Digital Director, about acquisitions, global expansion, and how the company has taken the skincare world by storm simply by telling it like it is.

Tune in to learn:

How is DECIEM different than the other skincare brands? (4:06)
Creating a unique marketing approach to disrupt the industry (10:52)
Why live shopping is top of mind. (26:50)
What product managers need to be thinking about when moving fast in digital transformations. (33:38)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

What is the Metaverse? Find Out from Neha Singh of Obsess

info@mission.org (mission.org) — Tue, 22 Mar 2022 07:00:00 +0000

What is the metaverse? How should you be using the metaverse? What’s the future of the metaverse? If you’ve ever asked any of these questions, you’ll find your answers from Neha Singh, the Founder and CEO of Obsess, a company that is bringing the metaverse to life for brands and consumers everywhere.

Tune in to learn:

How should you think about the metaverse? (4:00)
What does an example of a brand uing the metaverse look like? (9:00)
What is the current state of the metaverse? (14:00)
What are some of the misconceptions surrounding the metaverse? (18:00)
How can brands start using the metaverse? (25:00)
How can you blend online and offline experiences? (30:00)
What should brands be investing in right now? (40:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

When Customer Expectations Change Your Brand Should Too, with Joan King of Crate & Barrel

info@mission.org (mission.org, Mission) — Thu, 17 Mar 2022 07:00:00 +0000

For the first decade of its digital journey, Crate & Barrel didn’t even sell furniture online. Obviously, times and customer expectations have changed, and Joan King, Sr. Vice President, eCommerce & International at Crate & Barrel, has been there for the entire ride. Hear how the company shifted its strategy in line with its customer’s digital evolution.

Tune in to learn:

What have been some of the most surprising shifts in customer behavior? (6:00)
How do you create a seamless experience for big-ticket items? (8:50)
What mistakes are people making when thinking about ecommerce vs. retail? (11:00)
Why you should be looking to other industries for innovative ideas. (19:00)
Which brands are set up to succeed with shoppable TV? (25:00)
Why should we get excited about renewable commerce? (30:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

Virtual Reality Is the Next Ecommerce Frontier, with Barry Hoffman of ZeroLight

info@mission.org (mission.org, Mission) — Tue, 15 Mar 2022 07:00:00 +0000

According to Barry Hoffman, the Chief Strategy Officer of ZeroLight, we are right at the edge of a time when holograms and VR technology could become ubiquitous in our commerce activities. What do we have to do to get over the edge? Find out on this episode.

Tune in to learn:

How can you actually use visualization technology to improve brand experiences? (10:00)
When will we start seeing holograms? (14:00)
Why do brands need to challenge old ways of thinking? (16:00)
What elements of video games can translate to ecommerce? (20:00)
How can you create VR experiences that are comfortable? And why is that the first step to selling more? (28:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

How Web 3, NFTs, and More Will Reshape Ecommerce

info@mission.org (mission.org, Mission) — Thu, 10 Mar 2022 08:00:00 +0000

You might not think that a 100-plus-year-old company would be leading the way when it comes to future thinking about Web 3 and the metaverse, but David Oksman of Samsonite is here to prove you wrong. Hear how ecommerce brands should be taking these developments into account when thinking about long-term strategies.

Tune in to learn:

What are some of the Web 3 trends that you should keep an eye on? (2:00)
What is revenge travel and how will Samsonite take advantage of the trend? (10:00)
How did David create an authentic partnership and viral moment with JJ Watt? (12:00)
How can you implement lessons learned from successful campaigns in future campaigns? (14:56)
What is the fine line between being an “old brand” and taking advantage of a brand’s heritage? (18:00)
How should you assess the current retail landscape? (20:00)
What is the value of NFTs for ecommerce brands? (23:00)
Why implementing sustainability practices is good for business long-term.(26:00)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

Window Shopping of the Future with Ido Segev, VP of Partnerships and Business Development at Syte

info@mission.org (mission.org) — Tue, 8 Mar 2022 08:00:00 +0000

Have you ever seen someone wearing a shirt that you just have to have? Or maybe come across a certain piece of furniture that would be absolutely perfect for your space? Now imagine being able to snap a picture of that item and within moments, being directly connected to the product. Ido Segev and his team at Syte are making all this and more possible by leveraging AI to revolutionize product discovery.

Tune in to learn:

What's happening in the Israeli startup scene.
How visual A.I. is changing the shopping experience.
How Syte works.
What’s happening behind the scenes at Syte.
How Syte caters to the customer.
The future of product discovery.
Best piece of advice from Ido Segev.

Mentions:

Ido’s previous company Yotpo

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at mission.org.

Kara Goldin, Founder of Hint Water, Discusses What it Means To Actually Disrupt An Industry

info@mission.org (mission.org, Mission) — Thu, 3 Mar 2022 08:00:00 +0000

Kara Goldin fought against an archaic beverage industry to bring her revolutionary product to market, and along the way she had a transformative encounter with Jeff Bezos and negotiated getting her product into Whole Foods the same day she gave birth to her son. Want the full story? Tune in to this episode.

Tune in to learn:

Impossible is a mindset, but you can fight against it. (4:08)
Kara learned early on that you can’t take no for an answer. (10:47)
How to fight against old-school thinking and break in. (14:54)
Motherhood doesn’t have too hold you back in business. (23:35)
The joy of creating something that resonates with people. (33:01)
Stories that got cut from Kara’s book. (36:55)

Mentions:

Kara’s podcast: The Kara Goldin Show
Kara’s book: Undaunted
Graham Duncan’s Blog

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

mission.org.

Live Video Shopping is Coming, Here’s How Ecommerce Brands Should Prepare

info@mission.org (mission.org, Mission) — Tue, 1 Mar 2022 08:00:00 +0000

In China, live video shopping is a natural way of life. Why is that not the case in the west? Will western brands ever hop on the live video shopping bandwagon? Sophie Abrahamsson and Bambuser think so, and when they do, the potential return on investment could be huge. How huge? Find out on this episode.

Tune in to learn:

How can brands add value with live video shopping? (7:07)
What do live video shopping success stories look like? (7:30)
How does live video shopping fit into the metaverse? (9:20)
How live video shopping addresses ecommerce-specific problems.(12:36)
What are the metrics that matter in live video shopping? (13:43)
How to keep people engaged in live video shopping long-term. (23:46)

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Learn more at salesforce.com/commerce

Mission.org is a media studio producing content for world-class clients. Learn more at

mission.org.

Betting Big on Retail, Live TV, and (maybe) the Metaverse with Chase Fisher, CEO & Founder of Blenders Eyewear

info@mission.org (Mission, mission.org) — Thu, 24 Feb 2022 08:00:00 +0000

When you Google Chase Fisher, the CEO & Founder of Blenders Eyewear, you’ll see headlines touting a guy who turned a $2,000 loan into a $90 million dollar ecommerce brand. But Chase’s story goes way beyond those headlines. In my opinion, his thinking around ad strategies, supply chain, partial acquisitions, and more is more interesting and valuable to anyone who is looking for more than just a feel-good story. Chase got into all of those topics on this episode of Up Next in Commerce, and he took us behind the scenes of his supposed Cinderella story to tell us that it was much harder than it looked. Plus, we even touched on whether we’ll be seeing some Blenders glasses in the metaverse any time soon. Enjoy the episode!

Main Takeaways:

You Only Fail When You Stop
Throughout the life of a business, there will be hard and humbling moments and the thought of quitting will run through your mind. But you only fail when you stop trying. If you keep moving forward and pushing toward your goal, you will find your way, even if it’s not what you expect it to be.
Why Should DTC Brands Go Into Retail?
According to Chase, “When you're are an online brand, you need a living and breathing footprint. And so, I believe retail is going to be the next huge wave and I'm really excited about that.”
Should You Make a Big Bet on TV?
In short, the answer is probably yes. With ad performance, social platforms like Facebook diminishing, and as digital channels get more crowded, it’s becoming harder to win consistently. On TV, you can have bigger returns, but you have to be willing to plan, produce, and invest for the long-term if you go the TV route.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Respond quickly to changing customer needs with flexible Ecommerce connected to marketing, sales, and service. Deliver intelligent commerce experiences your customers can trust, across every channel. Together, we’re ready for what’s next in commerce. Learn more at salesforce.com/commerce

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For a full transcript of this interview, click here.

Questions Answered about Inventory, Shoppable TV, and More, with Andrew Goble, co-founder and co-CEO of Jambys

info@mission.org (Mission, mission.org) — Tue, 22 Feb 2022 08:00:00 +0000

If there is one commonality between all of the guests I talk to, it’s that experimentation and constantly learning more is what makes a company grow and thrive. Andrew Goble, the co-founder and co-CEO of Jambys, preached that truth to me on this episode of Up Next in Commerce, and we were able to dissect some of his bigger experiments to draw out insights anyone could use. For example, how should you be thinking about inventory in turbulent times? What are some of the ways you could be utilizing TV ads? And why is it sometimes more important to lose a customer in the short term in order to build trust for the long term? Find out all of that and more on this episode.

Main Takeaways:

What do you do to get over early company missteps, including communication, production, and launch issues?
When it comes to your team, you have to be willing to do things as well as you can until you simply can’t anymore. Bringing on experts and helping hands will get you farther than trying to stay lean. And with customers, honesty is always the best policy. It’s better to be honest about delays and offer a refund now and hope they come back, than lose their trust forever.
What platforms and channels should you get excited about?
While it seems like every brand is going all-in on social platforms, it might be worth more to go the traditional route and lean into a channel like TV or streaming services. There, you can find more engaged audiences who will sit through a message rather than simply scroll past it.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Meet The Metaverse: How Plazah is Writing the Next Chapter of the Ecommerce Story, with Founder and CEO Roger Casals

info@mission.org (Mission, mission.org) — Thu, 17 Feb 2022 08:00:00 +0000

When was the last time you checked into the metaverse? It might be more recently than you think, and you’ve probably been doing it for longer than you realize. Personal commerce is one of the ways that the metaverse is being utilized right now, and Plazah is the platform that has been making it possible. Customers who shop online and are given personal recommendations from experts at a brand are engaging in real time in the metaverse, but they are also having a better overall shopping experience.

On this episode of Up Next in Commerce, I chatted with Roger Casals, the Co-Founder & CEO of Plazah, about how the company is not only bringing ecommerce to the next level, but helping brands improve LTV and build customer loyalty at the same time. Roger tells us about the future of personal commerce, why it’s different from social commerce, and what you should actually be thinking about when you are making personal commerce a part of your ecommerce strategy. Enjoy this episode!

Main Takeaways:

Expert Vs. Employee: With personal commerce, it might seem obvious that the people who know the most about your products are your own internal employees, and therefore they would make the best experts for giving recommendations. This is the wrong way to think about it. An expert in the eyes of a consumer is someone who is unbiased, has actually used the product, and can tell you the pros and cons of it diplomatically. Those are the people you need to find to create a personal commerce experience.
Clicks Vs. Products: Personalization offers a way for brands to sell products rather than just clicks. Influencers more often than not are only driving traffic, not necessarily sales. By having a personalized commerce tool, customers can be fed actual products that work best for them, which they are more likely to buy.
Social Vs. Personal Commerce: Personal commerce is one-to-one and creates a long-lasting relationship between a brand and its customers. Social commerce occurs one-to-many and is about bringing a community together and building buzz.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

The Next Few Years Will Be Hard for Ecommerce Brands, Here’s How Nate Kennedy is Setting Horizon Hobby Up To Meet the Challenge

info@mission.org (Mission, mission.org) — Tue, 15 Feb 2022 08:00:00 +0000

Unless you’ve been living under a rock, you’ve probably heard that ecommerce has had a bit of a boom in the last couple of years. But does that mean a bust just around the corner? Some people think so. And even if the industry doesn’t see a full implosion, there will certainly be rumbles and challenges every brand will have to deal with. Some of the inflated demand will fall away, and more and more competition will continue to creep in. Nate Kennedy has a plan to face the turbulent times ahead, and he broke them down for me on this episode of Up Next in Commerce. Nate is the VP of Global eCommerce and Customer Experience at Horizon Hobby, which is a corporation that manufactures and sells high-end, hobby-grade radio-controlled cars, planes, boats, and accessories. In the last few years, Horizon Hobby has re-platformed, invested in paid media, and saw the value of influencers. So what’s next? Tune in to find out!

Main Takeaways:

Start Small: Going all-in on an idea you believe in might be exciting, but it can also be a big mistake. You have to test your ideas before investing time and resources into a tool, channel, or product that you believe will be a big hit. The customer will be the truth-teller, and you have to get their feedback before you make any big moves.
Turbulence Ahead: COVID created some artificial momentum for ecommerce and buoyed growth for a while. In the next two years, brands will have to create their own momentum and build demand for their products amid much more competition.
Bring Customers To You: The way to stand out is to be different — everyone knows that. But in practice, that means experimenting with your programs, your events, and your customer loyalty offerings to see where you can actually build an experience that will propel you beyond just selling products and into a place where you can become a lifestyle brand customers keep coming back to.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

How Brands like Sharpie, Food Saver, & Graco are Using Data to Level Up Their Ecomm Experiences with Michal Geller of Newell Brands

info@mission.org (Mission, mission.org) — Thu, 10 Feb 2022 08:00:00 +0000

The buying experience is becoming more and more of a puzzle that comes together differently for every consumer. How they discover something might be different from how they purchase something and how they purchase it might be different from how it gets fulfilled. You can find something in a store, buy it online, and have it delivered via an app. Every part of the process is being uncoupled, and brand leaders have to build for that reality. Every touchpoint, every experience, every interaction has to be optimized. For Michal Geller, the President of eCommerce & Digital at Newell Brands, this is even more difficult because Newell’s portfolio of brands is massive, and well known — we’re talking about Sharpie, Crock Pot, Food Saver, Elmer’s Glue, Graco, and the list goes on. With so many brands, and so many potential touchpoints and opportunities for cross-promotion, how are Michal and his team approaching this challenge? On this episode of Up Next in Commerce, Michal and I talked about the ways that Newell is experimenting, using data, and taking advantage of new opportunities in order to bring the ecommerce experience — and every other aspect of the business — to the next level. Enjoy this episode and to learn more about Newell Brands, check out newellbrands.com, and Instagram/Twitter @newell_brands and Newell and Newell Brands on LinkedIn!

Main Takeaways:

Data Dump: Every company has massive amounts of data, but the key is using data better. You have to experiment — even if you think the experiment is obvious — and then take the data from those experiments to guide your strategy. Putting a focus on experiments as a way to find better returns will yield better results than throwing money at marketing with no data to back it up.
Ecomm’s Magic Bullet: The best thing about ecommerce is that it is data-rich and that gives companies the ability to move faster than traditional brick and mortar retailers. With the real-time data, even if ecommerce represents a minority of sales, it should inform the majority of the business decisions.
Independent Customers: Part of the rise of ecommerce has been the rise of a more independent consumer, who has more choice and authority over purchase decisions. Brands have to cater to this kind of consumer and create buying experiences and touchpoints that are consistently excellent. It is only through exceptional service and experiences that brands will win consumers in the future.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Building a Durable Business That Can Survive Long-Term, with Sean Frank, CEO of Ridge.com

info@mission.org (Mission, mission.org) — Tue, 8 Feb 2022 08:00:00 +0000

If you ask Sean Frank, the future looks bleak. But if you go beyond that surface-level feeling of doom, you’ll actually find a guy who is thinking ahead and coming up with creative, innovative, and effective ways to build a durable business that can stand the test of time. Sean is the CEO of Ridge.com, a $100-million brand, which you might know for its popular Ridge Wallet, but it’s much more than that, and Sean has plans to keep the company growing. On this episode of Up Next in Commerce, Sean and I talked about how to stand out in the competitive world of ecommerce and what it means to have a good influencer and sponsor relationship. Plus, we go deep on what we think is coming down the pike in terms of inflation, supply chain, and more. Enjoy the conversation!

Main Takeaways:

The Only Way To Survive: In a hyper-competitive landscape, you have to control your own destiny, which means you have to try to do as much as you possibly can really well and put yourself in a position to get in front of the most eyes. Partnerships, owning your content and having exclusive access to your consumers are all ways to build a business that can stand the test of time.
Let Them Run: The best way to get a high ROI from influencers is to take a hands-off approach. When brands try to control exactly what their influencers say or post, it comes off as inauthentic. Although it is hard, brands have to relinquish control to the influencers who know their audiences the best and allow the influencers to connect with those audiences in their own ways.
Localized Manufacturing: In the next few years, technology is likely going to advance to a place where localized, automated manufacturing will be available to brands. Taking advantage of those technological advances will insulate brands from many of the supply chain issues that have crippled businesses.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

How Titan Casket is Disrupting an Industry With DTC Philosophies, with Founder Scott Ginsberg and Co-Founder Josh Siegel

info@mission.org (Mission, mission.org) — Thu, 3 Feb 2022 08:00:00 +0000

The DTC revolution can’t be ignored. Everywhere you look there are companies old and new reimagining the commerce experience and bringing more choice directly to the consumer. This is happening in every industry, including one you might not always think about — the funeral industry. For decades, consumers had limited options when they were making arrangements for the death of a loved one. Funeral homes monopolized the experience and often overcharged those who had few other choices. Scott Ginsberg and Josh Siegel wanted to change that. With Titan Casket, they, with their other co-founder, Elizabeth Siegel, have built a DTC business that puts the power back into the hands of the consumer at one of the most trying times of their life. On this episode, we talked about how Scott and Josh used the DTC playbook to disrupt the funeral industry, and we explored some of the ways they are mastering distribution and partnerships as a way to elevate their brand. Enjoy this episode.

Main Takeaways:

Don’t Sell What You Don’t Have: Although customers are forgiving, that only extends so far. With the supply chain issues ravaging every industry, you have to be upfront about what you have, when it will be available, and when you can guarantee a product will get delivered. Especially with a product that is time-sensitive, you should never leave delivery up to chance or reliance on outside factors.
The Key to Sales is Distribution: The more people who see and learn about your product, the more you will see sales rise and more traffic on your website. Don’t shy away from big channels like Amazon or large retailers, because being featured there will ultimately lead to a bump in awareness for your products.
Differentiate Yourself With Service: Even if your products can be found elsewhere, the reason customers will buy from your site and keep coming back is because of the experience they have. Differentiate yourself by providing the best customer service and an easy buying experience in order to build a solid customer relationship.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

What it Takes to Pivot and Scale Successfully with Amelia Wilcox, Founder and CEO of Nivati

info@mission.org (Mission, mission.org) — Tue, 1 Feb 2022 08:00:00 +0000

In life and in business, there will always be times when you have to pivot. That can be hard, and it’s not unusual to struggle while you're going through the thick of change. For Amelia Wilcox, a pivot in all of our lives led to a pivot in her business.

Amelia had grown her company, Incorporate Massage, to more than 4,000 corporate clients across the country, but when the pandemic hit and offices shut down, the decline in the need for massage therapists meant that Amelia’s entire revenue stream was coming to a screeching halt. But rather than fold, Amelia decided to pivot, and find a new need in this changing world that she could fulfill. Amelia identified the mental struggles that employees everywhere were dealing with and the fact that corporations didn’t know how to help those employees, so she created a new platform that corporations could offer to employees that included all manner of mental health resources. She rebranded her business in a matter of weeks, and has now grown her new business, Nivati, in a similar manner as her previous company. Amelia and I talked all about how that pivot happened, and what it takes for a founder or CEO to scale a company. Enjoy this episode!

Main Takeaways:

There are Tools Available: There are preconceived notions and stigma attached to mental health, but if you are struggling, it’s important to know that there are tools available to you and there is no shame in using them. Take advantage of things like therapy, wellness activities, and medication when needed to improve yourself, and, in turn, improve every other aspect of your life.
You’re Only as Strong as Your Mentoring Network: People are generally happy to help when asked, so if you are venturing out into a new business venture or trying to acquire new skills, find an expert and ask questions. Soaking up knowledge, running ideas by people, and learning through observation will all get you ahead faster.
You Can’t Scale Alone: The skills that you have that may have helped you build your company from 0 to 1 million are not going to be the same ones you need to scale from 1 million to 10 million and beyond. You need to have the self-awareness to realize that at a certain point, you need to bring in more people, learn new skills, and elevate everything that you are doing in order to reach a higher level.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Why Did Perdue Chicken Cross The DTC Road, with David Zucker, CMO and SVP Ecommerce at Perdue Farms

info@mission.org (Mission, mission.org) — Thu, 27 Jan 2022 08:00:00 +0000

It may seem like every company in the world has a DTC offering, but even now, there are businesses that are just entering the DTC space. Perdue Farms launched its DTC presence in January of 2020, and it has been go, go, go ever since. On this episode of Up Next in Commerce, David Zucker, the CMO and SVP Ecommerce at Perdue Farms, explained the steps he took to get this effort going and how the company is experimenting with the online customer experience. Plus, he explains how Perdue balances its DTC efforts with the relationship it has with retail partners, that may not always be happy with the idea of a company moving its product online. According to David, the key to making sure that you can succeed both online and in retail is to have transparency, communication, and a differentiation of offerings that will link both kinds of experiences, What does that look like exactly? Find out on this episode!

Main Takeaways:

Don’t Undercut Customers: When you work with retail partners, you want to keep a good working relationship with them even if you have your own ecommere goals. Don’t try to undercut or outprice the retailers you work with, find other ways to serve customers in ways that retailers can’t, like through bundles or bulk options, etc. And, try to find ways to drive demand to both your own site and your partners’ stores by building in technology or conversion tools that link everything together into a seamless experience.
Conveying Your Message: Sometimes the things you're proud of most live within the walls of your organization. But it could be helpful to let those secrets out and make them a part of your brand.
Go Old School: Acquiring customers is one of the biggest challenges any business faces. Instead of trying to compete with everyone else in the same new, up-and-coming channels, look to some of the traditional methods, like print and direct mail, where you can stand out and deliver something more unique that will resonate with customers.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

What it Takes to Actually Thrive as a Media Company with Jelani Memory, Founder and CEO of A Kids Company About

info@mission.org (Mission, mission.org) — Tue, 25 Jan 2022 08:00:00 +0000

Every company today is trying to become a media company, but few are actually succeeding. A Kids Company About is one of them. On this episode of Up Next in Commerce, I talked to Jelani Memory, the Founder and CEO of A Kids Company About, and I picked his brain on how exactly he went from writing and selling children’s books about tough topics, to overseeing a growing media empire. We talked about the need for authentic storytelling — in books or in your product or brand story — and how by trying to please everyone, you actually please no one. We also got into how to choose investors and what the future of media, particularly for kids, might look like. Enjoy this episode!

Main Takeaways:

Look For Experience: People are effective when they authentically know or have experienced the problem you are trying to solve. Those people have credibility and also the ingrained desire to work on addressing that problem, thus making them better to work with all around. Everyone is an expert on something, so find where those around you can bring out their expertise however you need them most.
You Choose Your Investors: When you are raising money, you are choosing who you bring into your ecosystem. You choose who to pitch to and you choose which investments make sense for your business. And even though it might be hard to turn down money, you should say no if and when an investor just isn’t right for you.
Can’t Please Everyone: When you try to make a product or tell a story that connects with everyone, you actually create something that connects with no one. Lean into what is actually true or unique to you, and don’t worry if it doesn’t resonate with certain people. The people it does resonate with will appreciate what you have done and they will trust you more moving forward.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How Reddit Became a Font of Knowledge for Alli Reed, Founder of Stratia Skincare

info@mission.org (Mission, mission.org) — Thu, 20 Jan 2022 08:00:00 +0000

This is a podcast about digital and ecommerce, so you already know we’re big fans of the internet. It’s a portal and a tool to give you direct access to consumers, information, and communication unlike anything that’s ever existed before. And if you’re living here in 2022 and expecting to thrive as a business owner, you better be tapping into every possible resource the internet has to offer. Alli Reed has known that for more than a decade, and her company, Stratia Skincare, got its start in large part thanks to the wealth of beauty and skincare knowledge Alli tapped into to turn an interest into a side hustle and then grow it into a multi-million dollar brand.

On this episode of Up Next in Commerce, I talked to Alli about how she turned her hours on Reddit into a brand that keeps growing, and we talked about all the ways to attract customers, differentiate yourself, and what it takes to educate the consumer beyond just knowing what your brand is, but also what it stands for and how it operates. Enjoy!

Main Takeaways:

The Reddit Goldmine: If you are looking for an engaged audience, Reddit is one of the best places on the internet to find some. But beware, not only are Redditors engaged, they are hyper-aware of any kind of inauthentic promotion or pushing of brands. When you show up on Reddit, you have to be authentic, and in return, you will see active, informed, and oftentimes helpful folks who can take your market research to another level.
Don’t Take Our Word For It: In categories that require a bit more effort to convert customers, it’s helpful to rely on UGC and customer reviews. Rather than asking potential customers to trust you the brand, ask them to trust their peers who are singing your praises. That’s a much easier and quicker way to get someone to pull the trigger than trying to convince them just based on your marketing materials.
You’re Not What You’re Not: There is always a rush to be the first to be certain ingredient-free. Whether it’s paraben-free, gluten-free, cruelty-free, or anything else, don’t let the marketing angle of being XYZ-thing-free be your crutch. Find a way to differentiate yourself that actually has a basis in need, science, or data rather than being the first to be “anything-free.”

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How Taco Bell is Satisfying Customer Cravings With More Than Just Food, with Zip Allen, Taco Bell’s CDO

info@mission.org (Mission, mission.org) — Tue, 18 Jan 2022 08:00:00 +0000

Humans have needs, and cravings, and desires. Sometimes, they all align — like when my need for food matches my desire and craving for a spicy burrito. In business, you have to be in tune to your customers' needs, cravings, and desires, and meet them as much as possible. These days, across the board but especially in the QSR space, the consumers are craving better loyalty programs and more personalized experiences in every interaction with a brand. Zip Allen recognizes that, and as the Chief Digital Officer for Taco Bell, she’s satisfying those cravings. Yes, there are spicy burritos involved, but there are also unique spins on customer loyalty programs, a new subscription service for tacos, and an app experience that makes getting those spicy burritos — or whatever you’re in the mood for — a friction-free experience. We got into all of that on this episode of Up Next in Commerce and it was a delicious discussion. Enjoy!

Main Takeaways:

Customizing the Experience: It alIt all comes down to digital when it comes to customizing the customer experience. On digital platforms, you can more easily engage with and learn about your customers, and deliver to them a seamless experience so you can get them what they need when and where they want it. Lean into all the digital tools in your toolbox and don’t be afraid to experiment with some new ideas to engage with customers through apps, subscriptions, or loyalty program challenges.
What do the Customers Really Want: To find out what customers want, go where they actually are, and then listen. Hang out on Twitter, find the Reddit threads where the fans of your brand congregate, and ingratiate yourself in that community. Not only will you get a better understanding of who your customers are, but you will be able to spot areas of friction as they come up and source new ideas for your brand from the consumers themselves.
Scoring More Than Points: With loyalty programs, you have to think beyond just giving points to redeem for free products Build out exclusive offerings, unique experiences, and ways to add value and delight to your customers’ day that proves that you actually know and value them.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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She Got Lori Grenier’s Golden Ticket on Shark Tank, Here’s How, with Kelley Higney, Founder and CEO of Bug Bite Thing

info@mission.org (Mission, mission.org) — Thu, 13 Jan 2022 08:00:00 +0000

When you first start a company or launch a product, you always have big dreams. You picture the massive deals, the millions in revenue, the corner offices and hiring a huge team. But before any of that happens, you have to tamp down those dreams and live in the real world, doing the hard, often year-long work on the ground proving your concept, talking to anyone who is willing to give you feedback, and knocking on doors to try to make a single sale. Kelley Higney trodded that path — in fact, she got her start selling her product at her daughter’s bake sales. Her fellow moms were her beta testers and, but they were also the wellspring of feedback and proof of concept she needed to bring her product to the next level… and to those great heights most people dream of.

Kelley is the founder and CEO of Bug Bite Thing, a safe, chemical-free solution for stopping a reaction to bug bites in their tracks. Today, Bug Bite Thing is available in more than 25,000 stores and has the backing of Shark Tank shark, Lori Grenier (who even gave Kelley her famous “Golden Ticket” when Kelley appeared on the show). On this episode of Up Next in Commerce, Kelley broke down all of the hurdles she had to overcome to reach that point. She discusses the strategies she used to protect her brand before even going into distribution, and she talks about the importance of community and feedback. Plus, stick around to hear about how she and Lori work together. Enjoy this episode!

Main Takeaways:

Any Feedback is Good Feedback: Even when you are just starting out, you should be pitching your product and accepting feedback from anyone and everyone. The early users and beta testers will guide you through your initial iterations and highlight some problem areas you might be blind to that you can address before going more mainstream.
Distribution is a Dangerous Game: It’s not a matter of if, but when copycats will come after you. When you start to distribute widely, copycats will come out of the woodwork and you have to be prepared. Do the work beforehand to learn how to protect your brand and fight against knockoffs. Even if you think you don’t qualify for a patent or other legal protection, reach out and try because it’s better to have any kind of legal backing than none at all.
Find a Mentor: You don’t need to go on Shark Tank to find a business mentor. There are people in your network or on the periphery who you should tap into and who can guide you through the highs and lows of business. Doing it on your own is a pipedream. Every successful person has had a team behind him or her, and the truth is, having help will get you to your goals faster.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How A Celebrity-Founded Company Finds Its Brand Voice and Owns its Supply Chain, with Execs from Hello Bello

info@mission.org (Mission, mission.org) — Tue, 11 Jan 2022 08:00:00 +0000

If you’re tired of all the supply chain issues here’s an idea, create your own supply chain. Okay, that’s easier said than done, and it’s not actually feasible for a lot of companies. But, there are parts of your brand, your logistics, and your strategy that you can own 100%, and when you do, good things happen.

On this episode of Up Next in Commerce, I chatted with Erica Buxton, the President of Hello Bello, and Jessica Tennant, the senior vice president of marketing at Hello Bello, a brand that is making premium products available to everyone — especially parents and families. Hello Bello was cofounded by actors Kristen Bell and Dax Shepard, a couple who came from humble backgrounds and knew that access to good, safe, environmentally conscious products shouldn’t be granted only to those with means. As a result, everything at Hello Bello is made to connect with and be available to parents and families of all kinds. And as Erica and Jessica explained, this ethos shows up everywhere. They talked about how owning your story and your brand voice is key, especially when it comes to marketing. And they also touched on why having a strong omnichannel strategy from day one is critical. Plus, they do get into what it means to actually own the supply chain, and all the ways that can open up new opportunities for your business. Enjoy this episode.

Main Takeaways:

One Voice: When thinking about developing a brand voice, you have to make sure this is established early and that it’s concrete. In order to have a brand people know and love, everything you put out should look and feel consistent, that way your brand is easily identifiable and consumers can become loyal to it.
Working Together: Having a strong omnichannel strategy is important. And it’s also key to remember that your DTC business doesn’t have to compete with your retail partners. They can work together in a way that allows the customer to have access to your products in as many places as possible. So when thinking omnichannel, think about ways to create good bonds with your retail partners or the brick and mortar side of your business so that you create an ecosystem where one part of the business feeds the other.
Owning The Supply Chain: For many brands, it seems impossible or simply out of reach to build your own factory. But as much as you can, you should try to own the elements of your supply chain. Not only will this insulate you from many of the delays and price hikes you see in traditional supply chains, but it will also allow you to take control of the quality of your products from start to finish, so you know you are always delivering the best products and you can iterate quickly based on what your customers need.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How The North Face is Using a Strong Data-Based Foundation to Create the Best Customer Experience, with Sarah Kleinman,Vice President of Digital Experience

info@mission.org (Mission, mission.org) — Thu, 6 Jan 2022 08:00:00 +0000

The customer should always be the guiding light for a brand. Who is your customer? What do they need? What do they want? Where do they live? How do they behave? These are all absolutely critical pieces of information upon which your entire business should be built. That’s Sarah Kleinman’s philosophy at least. Sarah is the Vice President of Digital Experience at The North Face, where she is constantly working to gather information about, understand, and then create experiences for North Face customers.

On this episode of Up Next in Commerce, Sarah guided me through how she thinks about creating an effective digital experience, and she explains the foundational elements that every brand should be using to ensure that they are set up for the present and can still build in the future. She talked about integration, enablement, loyalty programs, testing, why companies should be paring down their offerings, and so much more. This was a jam-packed episode, so I hope you love it!

Main Takeaways:

Integration, Integration, Integration: The success of your ecosystem is dependent on the connectivity of your tools. It’s not enough to build and launch a tool, app, or system, it has to be intertwined with your entire digital ecosystem in order to gather real-time data and create an easy flow for customers.
The Honest Truth: It is critical to create an honest segmentation of your customer base, because that is the base upon which everything else can be built. When you know what your customers actually care about, you can create the right products for them, the right marketing and digital content for them, and build out experiences that truly engage them.
Back To Basics: People are tired of gimmicks and they want less, more versatile stuff. As such, brands should have a goal to shrink their product offerings and focus more on the value they are bringing to consumers with the most quality, sustainable, versatile products.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Being a Tastemaker in Your Category, with Gail Becker, Founder and CEO of CAULIPOWER

info@mission.org (Mission, mission.org) — Tue, 4 Jan 2022 08:00:00 +0000

The newest diets and food fads are hard to keep up with, and some come and go without you even noticing. But there are some things that aren’t just passing trends. Cauliflower-based foods is one such thing, and no one in the category has done more for the movement than CAULIPOWER. Why? Because not only is CAULIPOWER gluten-free, it’s also absolutely delicious, which is what Gail Becker, the founder and CEO of CAULIPOWER, believes is the secret ingredient to success.

On this episode of Up Next in Commerce, I sat down with Gail for a fun chat about how she went from cooking a disastrous cauliflower pizza in her kitchen to running one of the fastest-growing frozen food brands around. She talked about how she got her foot in the door at Whole Foods, what her omnichannel strategy looks like, and why you should never let the copycats in your category get to you. Plus, stick around to hear the story of how a tiny pink house changed the course of Gail’s life forever. Enjoy!

Main Takeaways:

Showing Up is Half The Battle: There will be times in life and business when simply being in the right place at the right time will change everything. But if you don’t show up, you’ll never actually find those serendipitous moments. Think of every event and every opportunity as a step forward and a chance to take your company to the next level.
Don’t Bat An Eye: If you have made an impact in your category, there will always be copycats and competitors. You can’t focus on them because it will distract you from what’s important. All you should do is work on making the best product so that even with all the competition in the world, customers will always return to you because your product is far and away superior.
Prioritizing What’s Needed: When you’re first getting your business off the ground, oftentimes you have to build the plane as you’re flying. You don’t always have the money or the resources to set us your backend systems or marketing teams the way you want to, so you just do what works. But as you grow, you have to go back to those foundational elements of a business and prioritize your efforts to sure everything up.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How to Set Your Company Up for Success in 2022: The Evolution of First Party Data, Supply Chains, and Apple Privacy Updates

info@mission.org (Mission, mission.org) — Thu, 30 Dec 2021 08:00:00 +0000

On Up Next in Commerce we’re always looking for what’s, well, up next. How should brands be thinking about their omnichannel strategies? What are some of the new platforms or channels top brands are testing out? How is the ecommerce and retail landscape evolving? With 2021 coming to a close, it’s time to look a little closer at all of those question and try to answer them for brands looking ahead to 2022.

On this episode, I was excited to welcome back Caila Schwartz, the senior manager of consumer insights and strategy at Salesforce, and we dug into some of the stats, data, and insights her team has gathered in order to give some tips and advice to brands that want to get ahead and stay ahead in 2022. We talked about supply chains, loyalty programs, and had a debriefing on the iOS update that’s causing brands across the board to shift their marketing strategies in more ways than one. There are tons of great nuggets in this one so enjoy, and cheers to a great 2022!

Main Takeaways:

The Battle For First-Party Data: Loyalty programs and social will be key to get first-party data because they are the best ways to engage one-to-one with the consumers. It’s about a give and take between the consumer and the retailer, so the innovators in the space that can create unique ways to engage will ultimately win out.
Growth Spurts: In 2021, growth was much more modest than in the past and there were fewer promotional campaigns and discounts than in years past. The supply chain issues and the economic issues around the world have played a role in this change, and the trends may not necessarily reverse in 2022. As a result, consumers are impacted and brands have to find ways to pivot to make sure that consumers are getting the best possible experience.
iOS Update TLDR: Apple’s update in late 2021 has flipped email marketing on its head and brands have to adjust. If your marketing strategy is built around or includes open rates, then you should be rethinking and refocusing on click-thru rates instead. To get more results in that area, you have to level up your actual emails and create better, more engaging content.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Finding Opportunities, Thinking Outside the Box, and Leading the Retail Evolution, with Jiake Liu co-founder and CEO of Outer

info@mission.org (Mission, mission.org) — Tue, 28 Dec 2021 08:00:00 +0000

As ecommerce has become more prevalent, customers are catching on to some of the more suspect aspects of product marketing. They’re starting to notice that when you look for something like furniture online, you’re seeing a lot of the same exact products just branded slightly differently. Companies are using the same materials, the same suppliers, and selling the same or only slightly differentiated products, so the question for brands is, what do you do to stand out? For, Jiake Liu, the co-founder and CEO of Outer, the answer was simple: actually do something different. Outer is the first sustainable consumer brand for outdoor living with a core focus on material science, which, according to Jiake, is only one of the ways that Outer is separating itself from the competition.

On this episode of Up Next in Commerce, Jiake and I talked about all the ways brands should be thinking outside the box, why problem-solving should be the number-one driver of product development, and how Outer is hoping to be part of the evolution of retail. Enjoy this episode.

Main Takeaways:

Make Your Mark: There are industries that you think are saturated, but when you look closer, it’s plain to see that there are no brands truly owning the space. Marketplaces and retailers may be offering products, but no single brand of products truly stands out. This kind of situation is more common than you think, and when you spot the opportunity, you have a chance to differentiate yourself and create a foothold that could propel you forward.
Function Over Form: It’s always great to have a beautiful product, but too many companies focus on creating something with a beautiful design rather than a problem-solving function. Even in areas where you might not think there are too many problems to solve — like with furniture — there are still painpoints the need only a simple fix that could make your customers’ lives easier. And in doing so, you win their loyalty.
It’s an Evolution: A lot of people are talking about the death of retail, but in reality what is happening is actually the evolution of retail. Brands are reimagining the retail experience and creating new, unique ways to engage with customers in a retail setting. As such, retail i not going away, but only the brands that are thinking big and evolving in the space will have success in the future.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Feeding the Flywheel, And How to Get it Started in the First Place, with Steven Borrelli, CEO & Founder of CUTS

info@mission.org (Mission, mission.org) — Thu, 23 Dec 2021 08:00:00 +0000

Stop me if you’ve heard this before: in business, you always need to keep the flywheel spinning. Okay, wait, don’t actually stop the podcast! I know it sounds cliche, but it’s true — to have a successful business, you need to be constantly churning out products, bringing in customers, making sales, lather, rinse, repeat. That’s the part we all know. What so many founders and business owners can’t quite figure out is how to actually get that wheel spinning at all, let alone continuously.

On this episode of Up Next in Commerce, I talked with Steven Borrelli, the CEO & Founder of CUTS, a lifestyle ecommerce fashion brand that celebrities, entrepreneurs, athletes, and everyday folks love. Steven has some firsthand experience in the struggles of getting his company off the ground and into the hands of consumers — and his story includes an early $20,000 loss and a nine-hour journey through China. But he also has some of the answers that brands are looking for when it comes to building an efficient and sustainable growing business. What is his secret sauce? And how do testing, YouTube, and NFTs play a role? We got into all of that and more on this episode. Enjoy!

Main Takeaways:

Getting the Flywheel Spinning: Every company wants to have a flywheel spinning that brings in customers consistently and keeps the business running. But actually achieving that end is difficult. It takes getting the right people in the right roles, creating organizational efficiency, and spending money wisely. And, at the end of the day, knowing your numbers and trusting that math matters is always the most important thing.
Top-Down, With a Twist: Leadership has to stem from the top, and those in charge have to set a course and be clear on their vision for the company. But if you want your employees to succeed, they have to be able to set some of their own goals and determine for themselves how they think they can best help the company meet the mission set by the leader.
Fertile Soil: Having a good method to test ideas and gather feedback will yield a much more efficient product and marketing strategy. Don’t be afraid to test out new ideas in unique ways that invite customers and potential customers to engage with you in new ways. With enough good data, you can make bigger yet safer bets and grow your company much faster.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How Katapult is Giving Brands Access to Otherwise-Forgotten Customers, with CEO Orlando Zayas

info@mission.org (Mission, mission.org) — Tue, 21 Dec 2021 08:00:00 +0000

There are certain things many of us take for granted, including making purchases on our credit cards. It might surprise you to learn that 40% of the population is actually considered non-prime. This means they have either been turned down for a credit card, have bad credit or have no credit at all. These people are often denied the ability to make purchases, particularly on large goods, like appliances or furniture. But what if they could be given the opportunity to make those purchases? What if they were given the chance to make payments based on their own ability on their own schedule? That would not only open up a new customer pool for brands, but it would provide a way for a large group of people to build credit in a meaningful way.

Katapult is making all of that possible and on this episode of Up Next in Commerce, I spoke to Katapult’s CEO, Orlando Zayas= about how it all works. We talked about the difference between buy-now-pay-later and lease-to-own. We got into how new financing options lead to more incremental sales for brands. And we also dove into how to build a highly-functioning team and the challenges of going public. Enjoy this episode!

Main Takeaways:

Finding Missing Persons: When someone can’t get credit, or if they’ve been denied a credit card, they become non-prime consumers. This makes it much more difficult to purchase goods, particularly online. These customers eventually disappear, creating a void but also an opportunity to find them and bring them back into the fold. By giving these potential consumers additional avenues to make purchases, brands are adding more to their bottom line.
Consumer Control: By putting the control in the hands of the consumer, you allow them to get to ownership sooner rather than later. And when consumers are able to get to ownership with something they thought was out of reach, they are more likely to return and buy again.
Hire The Right People: You need a team that can act fast and independently, especially if you are a high-growth company. It’s imperative that your team can pivot fast and not get rattled when the company is going through a shift — like going public. If there are people on your team who aren’t working up to snuff, it’s better to cut them loose fast, rather than hang on to them hoping they’ll turn things around.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How DTC Brands Boom and Bust with Jesse Pujji, Founder and CEO of Gateway X

info@mission.org (Mission, mission.org) — Thu, 16 Dec 2021 08:00:00 +0000

To state the obvious, starting and growing a DTC brand is hard… even if you’ve been in the industry for years. Jese Pujji is the founder and CEO of Gateway X, a bootstrap venture studio that helps build businesses in the DTC space. Jesse has been working with and growing brands for years from the outside looking in. But even for him, when he tried to build a brand from the inside out, there were some real challenges and lessons learned.

On this episode of Up Next in Commerce, Jesse told me all about that first DTC venture, Poophoria, and the mistakes he made getting it off the ground. But he also talked about all the successes he’s had and the advice he’s been giving to the brands that come to him looking to take their companies to the next level. He talked about which channels to focus on, and why founders should really only hone in on one when they’re starting out. And he also gave us a peek into the future of mobile and why you should be looking at TikTok’s strategy as a benchmark for your own. Enjoy this episode.

Main Takeaways:

You Can’t Please Everyone: One of the mistakes brands make is not having a clear enough picture of who their target consumer is. It does not pay to be broad. Just because everybody drinks water doesn’t mean starting a water company and selling to the whole world will work. You need to hone in on a persona or two and speak to those people very specifically, otherwise your message will get lost in the shuffle. Research, talk to potential customers and build products and marketing that address them specifically.
Stop Channel Surfing: When putting content out early on, founders should pick one channel and find people who know how to run the campaigns. But, as the founder, you need to be involved in what you’re saying and who you’re talking to. By doing that you can make the economics work on a specific channel and then move on. Trying to focus on multiple channels concurrently is a recipe for disaster because they are each incredibly complex and nuanced. Plus, when you work on one at a time, you are able to learn and master new skills and then transfer them.
Tik Tok Talk: If you think about how revolutionary Facebook was 10 years ago, many believe that TikTok is in the same position to change the way we experience web and mobile content. The immersive experience, lack of a traditional feed, and the addictive nature of the platform is becoming a roadmap for brands that want to engage customers long-term, especially on mobile.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

These are the Digital Channels Ecommerce Brands Should Hone in On with Link Walls, VP of Digital Marketing Strategy for ChannelAdvisor

info@mission.org (Mission, mission.org) — Tue, 14 Dec 2021 08:00:00 +0000

To state the obvious, in order to be a successful ecommerce brand, you have to be able to win across digital channels. But just because it’s obvious doesn’t mean it’s easy. DTC and ecomm companies big and small are coonstantly challenged to find new approaches in ever-changing online channels to engage customers and ultimately get them to hit that buy button. So how do you do it? Link Walls is the VP of digital marketing strategy for ChannelAdvisor, and it’s his job to answer that question. On this episode of Up Next in Commerce, Link and I discussed what kinds of strategies are working — and more importantly which ones aren’t — and he let us in on how he thinks about advising digitally-native brands that are considering a move to brick and mortar. Plus, he gives advice on how to navigate through the holiday season, why shoppable TV is going to be the dominant channel of the future for brands, and which niche channels you should keep your eye on. Enjoy this episode.

Main Takeaways:

Understand and Speak To Your Audience: Building robust first-party data around your customers is the first step to ostaying ahead of the curve in the shifting world of ecommerce. Doing so will allow a brand too dive deeper into personalization, relationship-building, and bringing added value to the customer.
Should You Open a Store?: Recently, many digitally-native, DTC companies have been investing in retail and opening brick and mortar stores. But how do you know if this is the right strategy for your own business? The critical question you have to ask is whether or not having a store will create a unique experience that adds value and sets you apart from the competition in a real way. If not, then it’s likely better to save the cost and stick with selling online and investing in more digital channels.
Where are the Eyeballs?: When thinking about where to put your advertising dollars, you have to understand where customers are consuming content. These days, that means streaming and digital social channels. But still, brands aren’t investing fully in shoppable TV. They should be, though, and it can be done even on a small budget because with digital channels, there are better analytics that will help you hypertarget your audience at an economical price.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Are You Positioning Your Brand Correctly? A Roundtable Discussion with Executives From Doris Dev and Canopy

info@mission.org (Mission, mission.org) — Thu, 9 Dec 2021 08:00:00 +0000

The way you position your company in the eyes of your customers is the most make-or-break decision you can make. Who are you selling to? What problem are you solving for them? Why should a customer buy from you? All these questions need answers, and if they aren’t the right answers, it’s going to be a pretty rocky road.

So when you hear about a humidifier that’s being positioned as a beauty product, what do you think? Good idea or bad? Well, for the guys at Canopy, it turned out to be a great idea and we got into it on this special in-person roundtable episode of Up Next in Commerce.

Joining me in-studio here in Austin, Texas was Eric Neher, CMO at Canopy, Justin Seidenfeld, CEO at Doris Dev and Co-Founder of Canopy, and Lucas Lappe, Head of Product and Co-Founder at Doris Dev. We talked all things Canopy, but we also dove into Doris Dev, a product development agency that has helped scale companies like Blueland, Magic Spoon, BioLite, Supply, Lalo, and many more. During this epic chat, we touched on a little bit of everything -- from branding and logistical issues to product design and marketing, and beyond. I hope you have as much fun listening as I had hanging out with this lively trio.

Main Takeaways:

An Obvious Way In: When you are thinking about using a subscription model, you should have an obvious reason to get in touch with your customer or a product that they need to replace or replenish that is the basis of your subscription. When you force goods on customers that they don’t need or even necessarily want via a subscription, you spoil the relationship you have built with them.
Trendspotting: One of the most recent trends, particularly in the world of beauty, is blending innovative, creative experiences with products that are created with sustainable materials. Today’s customers have higher expectations than ever before and they are looking to support brands that rise to the occasion in every way.
The Need For Newness: Bringing new products, experiences, and opportunities to customers is one of the best ways to keep them engaged. But in creating new things — even if it’s just an updated version of something that exists — you are constantly struggling to make sure that what you build works, does what you want, does what the customer needs, and never takes away from the brand or the experience. But those are challenges you need to face in order to not pigeonhole your business by relying on one or two products forever.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How Ecommerce Is Growing Among Small and Informal Merchants in Africa and Beyond with Anu Adasolum, CEO of Sabi

info@mission.org (Mission, mission.org) — Tue, 7 Dec 2021 08:00:00 +0000

When you think about small businesses and local merchants, you know that they are the engine that fuels economies all over the world. This is true everywhere you look, including in Africa, where Anu Adasolum works as the founder and CEO at Sabi, a company that is helping informal merchants and businesses reach new heights. For too long, the tens of thousands of small, local merchants in Africa have operated without much help, credit, or access to technology. But while they have stayed the course, the world has moved forward toward a more digitally-focused future. To succeed long-term — in Africa and everywhere else — all businesses need access to opportunities to build credit, digitize their operations, and connect with suppliers and buyers everywhere. On this episode of Up Next in Commerce, Anu explains how Sabi provides those opportunities. She also discusses how B2B companies should be thinking about helping their clients succeed by focusing only on a narrow set of goals. Plus, she dives into what it takes to navigate through scaling a company. Enjoy this episode!

Main Takeaways:

The Pain Point is Access: For too long no one was doing the work of helping small businesses in Africa gain access. Small, local merchants were out on their own, and no banks or other creditors were even trying to lend to them, which has stunted their growth. By granting access to these merchants, they have an opportunity they never had access to before.
It’s Not Just About Digitization: Sabi is really about understanding the network of traders, building profiles, and then helping small businesses establish themselves and build trust in a way that allows them to succeed. Small businesses and informal traders have often been seen as a risk for investors, and in order for them to grow, a middle party is needed to de-risk the opportunity to build up these businesses.
Focus On What Matters: When you think about how you can improve sales and reduce costs for your customers, then you start to eliminate the tendency to force users into apps or channels or to use tools that don’t serve them. When you avoid that pitfall, you create a much better experience for your customers and you force yourself to focus only on what will help your company grow.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Burger King’s Head of CX On What It Takes to Bring the Best Experience to Quick-Service Restaurant Customers That Goes Beyond the Drive-Through

info@mission.org (Mission, mission.org) — Thu, 2 Dec 2021 08:00:00 +0000

Picture this: You’re driving down the road and you see a familiar sign that gets your stomach grumbling, so you quickly pull into the drive-through, place an order and, within minutes, you’re enjoying a tasty bite of what you were craving. That’s not a hard scenario to imagine. Odds are, we’ve all gone through that exact sequence of events in our lives. And that’s great for those businesses, and even for other stores where the foot traffic drives people in to shop. But that kind of customer isn’t the only one you should be relying on. Smart operators know that there are huge portions of the population who don’t often find themselves in those serendipitous moments when they can make that impulsive decision to buy something on the spot. Angelo Frigo is one of those smart operators, and as the head of customer experience at Burger King, he is trying to move beyond the drive-through and reach customers in new, exciting ways — particularly online and through Burger King’s digital app. On this episode of Up Next in Commerce, Angelo and I go into some of the ways businesses can think about targeting and engaging with customers outside of in-person and spur-of-the-moment experiences. Plus, we also dug into Angelo’s background, which is fascinating, and includes stops at McDonald’s, Feeding America, and even the White House. Enjoy this episode!

Main Takeaways:

A Bigger Burden: In the government sector, customer experience is often boiled down to measuring the “burden” of something. And, thanks to an old school definition, “burden” is sometimes thought of literally as paperwork. So, reducing “burden” means reducing paperwork. As a result, the customer experience when dealing with government agencies hasn’t been optimized in all the ways we’re used to. Part of improving the customer experience at the government level begins with simply redefining what is included in the experience, and then removing friction at all points.
Moving Beyond The Drive-Thru: Expanding reach beyond the drive-thru is one of the main areas of focus for chains like Burger King, which are attempting to market to people who traditionally only buy from quick-service restaurants when they see them close by and it becomes top of mind. To combat that, chains need to develop digital apps and ordering services with profiles, personalization, and creative marketing, design, and participation opportunities.
Testing, Testing: It’s important to think outside the box in all areas of the business. In the app space, you should look outside your industry for ideas and inspiration rather than copying what’s most trendy or what’s working with your immediate competition. Then create prototypes and test ideas whether that’s with customers or with team members at all levels across your company.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Building The Best Subscription Product in a Crowded Market, with Rod Morris, the Co-founder and President of Lovevery

info@mission.org (Mission, mission.org) — Tue, 30 Nov 2021 08:00:00 +0000

Does the world really need another subscription box? Do parents really need to buy more things for their kids? Well, when we’re talking about Lovevery, the answer is yes and yes. In the crowded spaces of DTC subscription services and childrens products, Lovevery is making its presence known. On this episode of Up Next in Commerce, I talk to Rod Morris, the co-founder and president of Lovevery, who told me all about the development of the company’s amazing products, and, more importantly, how he and his team went about making them stand out among the rest. It takes a lot of hard work — but it all starts with a complete obsession with creating a brand that you believe in and products that fill a gap in the market. Rod took me behind the scenes of getting press and testimonials for Lovevery, he told me how they create social content that sees engagement that blows the competition out of the water, and we also dug into his tips for fundraising and what the upside is to going public. Enjoy this episode!

Main Takeaways:

Winning with Connected TV: If you can break format and do something divergent, you will be able to find success in the world of connected TV. People are engaged by unique content, so you should constantly be looking for ways to take wha’s working and flip it on its head.
Understanding the International Market: When you take your company abroad, there is a steep learning curve to understand how to win customers and take a part of the marketshare. Even if your product works the same wherever you sell it, the process of marketing it and adhering to regulations varies. These are important things to consider and prepare yourself for if/when you are seeking to expand overseas.
It Takes Heart, Soul and Obsession: The way to keep LTV high and keep growing you need a mix of ingredients. First, you have to truly be obsessed with your product, love it, and constantly strive to improve it. Second, invest in content and reaching the audience you care about with useful and engaging content. Finally, you have to stay connected and work with customers so that they feel invested in the product and the company rather than being on-off shoppers.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Difference Between Men and Women … In Marketing, with Matt Mullenax, Co-Founder and CEO of Huron

info@mission.org (Mission, mission.org) — Thu, 25 Nov 2021 08:00:00 +0000

The old saying goes that men are from Mars, women are from Venus. And while that’s not literally true, when it comes to marketing, men and women do seem like two different species. What resonates with a man is wildly different than what resonates with a woman. For instance, I love a good ingredients list and couldn’t care less about how much lather I get from my body wash. A lot of men apparently feel the exact opposite. These are the kinds of things that all businesses need to think of when it comes to targeting and sending the right message. And it’s a topic I went deep on in the episode of Up Next in Commerce with Matt Mullenax, the Co-Founder and CEO of Huron. Matt talked me through all the ways he had to test, poll, and iterate on his advertising to get his men’s body care brand off the ground. But when he found the right formula, all of a sudden it was like striking gold. We’re talking crazy click-through rates, plummeting CPAs, and a direct line into the messaging that men are aligned with. Do you want to know what it is? And are you interested in what other heavy lifts Matt is working on now for long-term payoffs? Find out on this episode!

Main Takeaways:

The Humanization of Brand: People used to be excited by the novelty of buying online. As the DTC world evolved, consumers have gotten smarter and these days, your brand has to resonate in ways beyond just having a good product available. Some of the aspects of humanizing the brand, such as building personal connections, will require a heavy lift upfront, but the long-term value.
An Atypical CX Strategy: Historically, CX has been seen as reactive, but there are ways to be proactive and ensure an exceptional customer experience no matter the situation. You should not wait for a problem to arise to help a customer out. If you know there might be a delay in shipping or some other situation arises, by reaching out before the product is delayed, you build trust with your customer.
Find Your Internal Cheat Codes: Whether you have a founder with deep connections in manufacturing or you’re friends with an Instagram influencer, there are certain elements you bring to that table that you should tap into to give you a leg up in one way or another.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Scaling Up a Queer-Owned Fragrance Brand With Inclusivity and Authenticity with Matthew Herman, Co-founder of Boy Smells

info@mission.org (Mission, mission.org) — Tue, 23 Nov 2021 08:00:00 +0000

There are about a million different inspirational quotes about being your authentic self and how to bring authenticity to everything you do — including your business. Matthew Herman and his company, Boy Smells, brings those cliches to life in real and very cliche ways. Boy Smells produces candles, fragrances, and more that defy the traditional gendered lines that have been drawn for decades in favor of creating a genderful experience that allows all customers to bring a mix of masculinity and femininity to their lives as they see fit. On this episode of Up Next in Commerce, Matthew and I talked about what that looks like in practice, and we dove into how and why Boy Smells has pivoted from focusing on wholesale, to DTC and now to retail and partnerships.

Main Takeaways:

Finding Functional Experts: Adding headcount is one of the most stressful parts of scaling. To make things easier, the focus should be on finding and bringing in functional experts. You will save time and money bringing in a better candidate who might cost more but can get to work quickly rather than bringing in a novice and trying to train them to work in your system.
A Pyramid of Products: Creating products that can stand the test of time is important. But having one evergreen product won’t sustain a business. You have to strive to have a three-tiered pyramid mix of products, which starts with a base of core products, followed by seasonal products, and topped with special, one-of-a-kind, buzzy products that can drive sales and engagement.
Don’t Jump In: You hear all the time that when you have an idea, you should jump in and do it. In reality, you’re often much better served by gaining experience at already-established companies so that you can learn from their successes and failures and bring that knowledge to your own venture.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Choose How You Feel Using Technology, with Scott Donnell, Founder of Hapbee Technologies

info@mission.org (Mission, mission.org) — Thu, 18 Nov 2021 08:00:00 +0000

Every company will tell you it sells something that will make your life better, easier, or more efficient. But at the end of the day, how happy are consumers with all of the things they buy? Or, better yet, how happy are consumers in general? Hapbee is a company that is focused on both of those questions, and on this episode of Up Next in Commerce, I talked to the founder of Hapbee Technologies, Scott Donnell about how they find the best answers. Scott told me all about how he learned of the technology that powers Hapbee’s device, which sends out frequencies that give you the effect of certain drugs or chemicals without needing to ingest them. So if you’re looking for a kick of caffeine, or some melatonin to get to sleep, Hapbee creates what’s called blends to give you that effect just through low frequencies. It’s intense technology, and it takes a lot of consumer education and testimonials to get the word out. Scott told me how he went about doing that and building Hapbee into a company with a line of consumers just waiting to give it a try — and Scott explained how he’s meeting that demand in a time of supply chain issue galore. This was a really fun episode, I hope you enjoy!

Main Takeaways:

Tapping Into Einstein’s Ideas: Einstein had an idea that everything is connected, and he was right. Your cells interact in an interconnected way and in an effort to prove him right, Hapbee created a technology that could be produced and sold. By constantly asking “what if,” you give yourself an opportunity to do the same thing — find new ideas, potential business ventures or products, and build something the world didn’t know it was missing.
Who Not How: Part of being a leader is knowing your strengths and weaknesses. And it’s about being willing to bring in people who can level you up in both areas. You should constantly be looking for people who are smarter than you so that you can bring them into the company, learn from them, and help do a better job than you ever could. Task lists for leaders shouldn’t be actual things to do, but instead should be about finding people they need to bring in to accomplish tasks.
Your Network is Your Net Worth: Building relationships and having strong connections is the most important thing you can do as an entrepreneur. Not only can these people be a source of support and advice, they can also be recruited to help you lead, to solve a problem, or to bring in other people who can broaden your network even more.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Linens That Last: Penny Murphy, President of Pioneer Linens, Discusses How Company Pivots Have Led to More than a Century of Success

info@mission.org (Mission, mission.org) — Tue, 16 Nov 2021 08:00:00 +0000

So much from the past is long gone — corded phones, the food pyramid, writing checks at the grocery store. But on the flip side, there are things from years gone by that have come back — mom jeans anyone? And then, there are the things that last the test of time. Traditions, styles, and yes, even businesses. Pioneer Linens is one of those companies that has stood strong for more than 100 years and sure, it has gone through its fair share of changes and pivots over the years, but as President, Penny Murphy, told me on this episode of Up Next in Commerce, the commitment to serving its customers has remained through it all. And today, Pioneer Linens is succeeding by giving customers the best experience not just in-store, but online as well. In fact, Pioneer moved into the ecommerce world way back in the 1990s, and Penny led the charge. We got into that story and dug into the company’s long history, the lessons Penny and her daughters have carried into running the business today, and where this century-old company is headed next. Enjoy this episode!

Main Takeaways:

A Lasting Legacy: Although a company may pivot or change throughout its history, what customers remember most is the experience they had and the people within the company they interacted with. No matter where your business is headed, the most important thing to remember is to create the best customer experience possible and connect with customers as much as you can.
Lessons From The Past: Even if you don’t have a 100-year company history to rely on, you can always look to the past for trends and ideas that are likely to come back around. There is a saying that history repeats itself — and it’s true. So be a student of history and prepare yourself with knowledge of what has happened before so you can be ready for the future.
Instant Gratification: Although it is sometimes risky to carry a lot of inventory, it’s equally risky to not have enough of what customers want readily available. When customers shop, they are often looking to solve a problem right now, and if you can’t meet their needs, you will lose out on a sale today, and also the possibility of future sales from that same customer.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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What it Means to Be Sustainable with Maisa Mumtaz-Cassidy, Founder and CEO of Consciously

info@mission.org (Mission, mission.org) — Thu, 11 Nov 2021 08:00:00 +0000

Do you know where the shirt you’re wearing came from? Not the brand, the actual fabric. Do you know who constructed the shirt? If you’re a brand owner, do you truly know the conditions of the workers who you are sourcing goods from? Are they being paid fair wages? Do they have a safe environment to work in? For far too long, these questions were left not just unanswered, they weren’t even being asked. But in today’s world, the consumer is more aware of and cares about all aspects of their products, and they are voting with their dollars to support the brands that are doing things the right way. The problem is, though, that it’s often hard to know for sure which brands are true to their word when they say things like they are “ethically-sourced,” “fair trade,” “vegan,” or any of the other buzzwords that they have identified. That’s where Maisa Mumtaz-Cassidy comes into the picture. Maisa is the Founder and CEO of Consciously, a curated marketplace made for sustainable fashion. On this episode of Up Next in Commerce, I talked to Maisa about how she built her marketplace, what she looks for when she invites a brand onto the platform, and she gave some tips to sustainably-minded consumers on what questions they should be asking of the brands they want to support. Enjoy this episode!

Main Takeaways:

The Big Disconnect: The Western buyer is, unfortunately, not often clued into the working conditions of garment workers around the world. Many third-world countries are the source of the garments we wear every day, and the conditions there are too often unsustainable and unsafe. When consumers dig into where their brands source their goods, there is more of an opportunity to improve the conditions and therefore the lives of the people who do the work.
Don’t Trust, Verify: As a brand or as a consumer, you should not simply take someone at their word. If the suppliers you work with say that they pay fair wages, make them prove it. Ask for pay stubs and go visit the factories or talk to the workers one-on-one to ensure they are being treated fairly. As a consumer, if a brand says they are ethically sourced, research what that means and ask them for proof. Request information about the products they offer and do your homework before you hand over money to a brand that is not operating in good conscience. And, by asking questions, you may bring to light issues that the brand didn’t even consider and thus contribute to finding solutions.
Built to Serve: If you state that you are built to serve the customer, you have to actually follow through. Stay engaged as much as possible. Have human-to-human interactions. Run polls and ask questions across platforms, and respond when customers reach out. These are simple but often-forgotten steps many brands should be paying more attention to in order to ensure customer satisfaction remains high.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How Spikeball is Building the Next Global Sport, with CEO Chris Ruder

info@mission.org (Mission, mission.org) — Tue, 9 Nov 2021 08:00:00 +0000

Starting a business is hard enough. Try launching and building an entirely new global sport. That’s one heck of a challenge. But when you have a good idea, a product, and an organic way to connect with people, it’s actually possible.

Chris Ruder is the CEO of Spikeball, and he initially thought his little business would be a fun side hobby. The company idea even started off with the age old question, “Wouldn’t it be cool if..?” But within five years, that little business with zero employees was earning $1.5 million in revenue and attracting attention around the world. That didn’t happen by magic, though, and on this episode of Up Next in Commerce, Chris and I dug into scaling a company by asking the questions you think are dumb — including to your own customers. For Chris, simply asking, “How did you find out about us?” was the turning point to finding an audience and then nurturing it so that it grows in the most organic way possible. He also gave the inside scoop on his Shark Tank experience, and why he encourages other entrepreneurs to take advantage of that opportunity if they are ever presented with it. Plus, Chris explains how he’s been navigating the supply chain issues, including by finding new ways to expand the company beyond just physical products. Enjoy this episode.

Main Takeaways:

Ask The Dumb Questions: Many new founders come into an industry with questions that may seem dumb or obvious, but they need to be asked. Find people around you who can help guide you or inform you so that you can continue making the right moves without having to backtrack. This includes asking questions of your customers. Ask them what they think, how they found you, and what made them click “buy.”
Set Customers Up To Be the Hero: When you engage with customers, you can offer them the opportunity to be your ambassador, but in the most authentic way. Work with them to develop their own community and following, set them up to be the hero, and in turn, you will see more organic growth and brand love than simply paying people to promote your brand for you.
The Shift to Stuff: The last two years have seen a major change in how people shop and what they shop for. Consumers have moved away from experiences and moved toward buying more stuff to fill their time and satisfy their itch. CPG companies have been forced to supply more than ever, and the logistics and supply chains have suffered as a result. Work with your vendors and shipping partners to find more creative solutions, and try to find additional ways to bring manufacturing closer to home — even if that means adding different kinds of goods and services to your product portfolio so that you are not beholden to the supply chain.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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From Sales to SaaS: Diana Lee, CEO of Constellation Agency, Discusses Building and Licensing a Hyper-Local Ad Tool

info@mission.org (Mission, mission.org) — Thu, 4 Nov 2021 07:00:00 +0000

It’s not every day that a car salesperson becomes a founder and CEO of a SaaS company that is revolutionizing the way companies do localized advertising. But that’s the path that Diana Lee followed, and on this episode of Up Next in Commerce, we went through the whole story… and dug into how her company, Constellation Agency, built a technology that helped marketers stop crying (literally) because it was so hard to create hyper-local advertising. We also dove into how to think about capturing data in a world without cookies, and we discussed why, if you’re going to be in the market for a car in the next year, you definitely need to be ordering one right now. Enjoy this episode!

Main Takeaways:

Scaling Creative and Locality of Ads: In the past, there was no easy way to do advertising at scale in a hyper-local way, which is one of the most effective ways to advertise. Making local ads was a problem that would take a month for advertisers to solve, and now it’s a one-click solution. By investing in this solution, not only was Constellation Agency solving a problem for itself, but stumbling on a solution that everyone in the industry needed and wanted.
Life Without Cookies: The downfall of cookies is a worry for many marketers, but there is still a way to capture first-party data that will allow you to succeed. By rethinking the ad unit itself, and building all of the choice and preferences into the ad unit, you can ingest the consumer data you need in a way that you control.
Don’t Water it Down: It’s a nice idea to be a one-stop-shop for your customers, but when you do everything, you’re never able to become an expert at anything. Find what you’re great at and focus on that because if you can be the best at one thing, you won’t need to do anything else because customers will flock to you for your expertise.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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From Unconventional Experiences to the King of Customer Experience, with Eli Weiss, Director of Customer Experience at OLIPOP

info@mission.org (Mission, mission.org) — Tue, 2 Nov 2021 07:00:00 +0000

To say that Eli Weiss has taken an untraditional path to where he is today would be an understatement. Currently, Eli is the Director of Customer Experience at OLIPOP, but his roots are in a traditional orthodox Jewish household, his education does not include a college degree, and his first job in the industry came as a result of him doing a powerpoint presentation to the folks at an emerging luggage brand about why they were failing. Yeah, not what you’d expect. But Eli’s whole career is about going above and beyond expectations — consumer expectations. From that luggage brand to NUGGS Vegan Chicken Nuggets, and now with OLIPOP, Eli has become a master of building out the ultimate customer experience, and he took us behind the scenes on this episode of Up Next in Commerce. Plus, he told us about the job board he set up to help people like him — with skills but untraditional backgrounds — so that more awesome folks can work their magic in the CPG space. This was seriously one of my favorite interviews, so I hope you enjoy it!

Main Takeaways:

The Road Less Traveled: Oftentimes, those with untraditional backgrounds or different levels of educational and career experiences get overlooked for jobs they are more than qualified for. Companies need to be willing to look outside the box and invest in people who can prove they have the skills needed to do a job, even if their past experiences don’t line up with who you normally would hire.
Promises Kept: It seems simple, but one of the biggest things companies overlook when it comes to customer experience is whether or not they are delivering on the promises they make. Take a look at your ad copy, your website, your social channels and product pages and determine if what you are selling to customers is what they actually get.
More Than a Customer, A Friend: When brands interact with customers, most of the time the entire interaction is focused on a sale. But the best kind of customer experience comes when a brand treats a customer like a human being, and when addressing them, the brand thinks, ‘what would my friend want or need in this situation?’ Even if someone is canceling a subscription, find out the backstory on why they are cancelling their subscription, maybe there is a deeper reasonthan what you expect and there is something you can do to reach out not to sell, but to show you care.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Talking Telecos, Marketplaces and 5G, with executives from Gotransverse, Mirakl, and Matrixx

info@mission.org (Mission, mission.org) — Thu, 28 Oct 2021 07:00:00 +0000

When you look down at your phone, do you see a little 5G symbol? Do you know what that means or what kind of service 5G is providing? To take it a step further, if you’re a business owner, are you connected to 5G? Is it helping your company move faster and operate more efficiently?

Whatever the answers to those questions are, the problem remains that many of us, consumers and business owners alike, are still mostly in the dark about what 5G truly is, how it’s different, and why we’re actually only just scratching the surface of what 5G is capable of.

On this roundtable episode of Up Next in Commerce, I dove deep into the mysteries of 5G with Geoff Coleman, Chief Product Officer at Gotransverse, Natasha Sachdeva VP Solutions Engineering at Mirakl, and Olivier Smith, Technology Lead from the Office of the CTO at Matrixx. We discussed what 5G is and is not, how it’s currently being utilized, and what kind of possibilities will be opened up when 5G is made available in a more widespread manner. But to get there, it’s going to take a lot of partnership with telecom companies, enterprise software businesses, and cloud, platform and marketplace providers, which is what brought my three guests together. It was a really interesting discussion, and I hope you enjoy it!

Main Takeaways:

Making It Sticky: What makes something like a marketplace sticky for consumers is how seamless the experience is for everyone. Whether you are offering local goods or using a marketplace to bring more wide-ranging products from all over the world to customers’ in your backyard, whatever you’re selling matters less than how easy the shopping, transaction and delivery experience turns out.
How Marketplaces Create Growth and Opportunity for Sellers: There are limits to how ecommerce can grow and scale, and marketplaces offer a way to expand those opportunities. Marketplaces offer sellers speed and agility, along with resources that they cannot get elsewhere.
Partner Up: As large and far-reaching as telecommunications companies are, even they cannot provide 5G to every industry. In order to advance the technology across all fields, partnerships with other large enterprise companies are necessary. This sets up a B2B2C model that requires finesse and understanding of different roles, particularly as it relates to delivering technology and services to the end consumer.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

How You and Your Business are Becoming Victims of Fraud and How to Fix It, with David Fletcher, SVP of ClearSale

info@mission.org (Mission, mission.org) — Tue, 26 Oct 2021 07:00:00 +0000

Fraud has been a problem for centuries. And there have been bad actors and people with ill intent since the beginning of time. What’s different today is the tools and methods that fraudsters are using, particularly when it comes to perpetrating fraud online. Both consumers and brands are in a constant battle against hackers and fraudsters who are gaming and attacking their defenses and stealing hundreds of millions of dollars. So to protect themselves and their cus, brands are putting strategies in place to limit their exposure to risk and stop fraud before it starts. But not only will that defense not last long because fraudsters are always coming up with new ways to run their schemes, more often than not the defenses a company sets up create a bad user experience for the very customers they try to protect.

David Fletcher is the Senior Vice President at ClearSale International, and he and his team are helping to create better solutions, fight fraud, and help ecommerce companies process more orders while giving users excellent experiences. He told me all about it on this episode of Up Next in Commerce, and there are some great ideas for any brand to think about implementing. But even more than that, David and I went deep on some of the other hot topics in the fraud and privacy world, including the debate around two-factor authentication and what’s happening on the dark web. It was so interesting. Enjoy!

Main Takeaways:

Cutting Off Your Nose To Spite Your Face: One of the ways many companies fight fraud is through filters. If they see suspicious activity from a geographical location or type of customer profile, they set their system to automatically decline those sales in order to prevent fraud. However, in doing that, the company has set up a system that will generate false declines — declining legitimate sales based only on generic information that has been flagged. In order to truly fight fraud and not negatively impact other customers, companies need to be more specific and targeted with their efforts.
The Unsolvable Problem of Fraud: No matter what you do to address fraud as it happens right now, there will always be new ways that fraud occurs as time goes by. It takes constant vigilance and attention to the environment you’re working in to stay ahead and protect your business and your customers. And while technology can help, having actual humans look into potentially risky transactions is the best way to identify what’s fraud and what’s not.
Dig Into Data: By examining historical data, companies like ClearSale can get a full picture of how a company has operated and where its weak spots are when it comes to things like false declines and chargebacks, or other indicators of fraud. And from that data, you can almost immediately implement machine learning to improve your processes and get more orders approved.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

A Technology Solution that is Upending the Fashion Industry, with Omer Kulka, CMO of Kornit Digital

info@mission.org (Mission, mission.org) — Thu, 21 Oct 2021 07:00:00 +0000

Kornit Digital has always marketed itself as a developer of technology, which, in today’s world is pretty much what everyone says. In 2021, it seems like every company is either a tech company or a media company. So what is it that makes Kornit different from all the rest? Well, it starts with the fact that Kornit is creating technology that is more than just an app or a gadget: it’s developing tech to enable sustainable fashion production, which could have quite an effect on a $3 trillion industry. To achieve this end, though, means that brands have to start thinking and acting differently. Instead of supply and demand, it’s going to be all about demand then supply.

Currently, 30% of fashion inventory is going unused and unsold. That negatively affects not just a company’s bottom line, the resources wasted in producing and then eliminating those items has a massive negative impact on the environment. On this episode of Up Next in Commerce, Omer Kulka, the CMO of Kornit, explained to me all the ways the company is working to bring new technology, a new business model, and a whole new way of thinking to the industry to start turning those negatives into something better. And the change is coming sooner than you think, so if you want to be prepared, you’ll definitely want to pay close attention to this convo. Enjoy!

Main Takeaways:

Monetizing Trends: Everywhere you look, something or someone is going viral. For too long, it’s been next to impossible to monetize those trends, but that’s changing. By shifting to a demand and supply model, brands can create a system that allows them to meet the moment and deliver goods to customer that they want in the moment and then still be ready to deliver again when the next trend comes along.
Culture Eats Strategy For Breakfast: These days, if you’re not innovating and disrupting yourself, you’ll be out of business in the blink of an eye. The best companies in the world are always shifting gears and changing their skin to meet new demands. This takes a lot of strategy and preparation, but more importantly, it take great people and a culture where your employees are not afraid of change, they lean into it.
The mash-up between physical and virtual worlds: Virtual fashion is fashion that doesn’t exist in real life — think video and computer games or even in the future on Instagram— and it is an exciting new opportunity for on-demand, sustainable fashion.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

It’s Not Always Easy: Fort’s Rocky Road with Conor Lewis, Founder of Fort

info@mission.org (Mission, mission.org) — Tue, 19 Oct 2021 07:00:00 +0000

On this show and so many others, you hear a lot about the success stories and the big companies doing new and exciting things. But the fact of the matter is that those tales of major profits and winning market share and scaling, they were almost always preceded by some really tough times and moments that have crippled many entrepreneurs who have tried to trod the same path.

Conor Lewis is right in the middle of those extremely tough times. Conor is the founder of Fort, a company that sells magnetic pillow forts for kids. It’s a brilliant idea, and that’s not just my opinion. Tens of thousands of backers on Kickstarter agreed, and they pledged more than $2 million to see Fort make its way into their living rooms. And yet, despite the buzz and the big raise, Conor is at a crossroads. He is on the cusp of success, but dealing with massive supply chain and logistics challenges that are also impacting companies around the world. Right now is where a company like Conor’s can launch into the stratosphere… or not. So on this episode of Up Next in Commerce, I was excited to talk to Conor and hear from him exactly what he’s going through, how he’s dealing with the challenges of a young CPG company, and where he thinks Fort can get to once he pulls the company through these rough early stages. This was a raw, honest, and interesting conversation that I think so many entrepreneurs and business folks will relate to. I hope you enjoy it!

Main Takeaways:

Hindsight is 20/20: There are certain areas of your business that you will have a handle on right from the get-go. Other things you will have to learn along the way. One of the things many first-time founders lack is access to a network who can help them, so they fly blind and they learn hard lessons building a network along the way, understanding how and where things could have gone better, and implement those lessons as the company grows.
Competitor Adjacent: One hack new product companies can try is to find channels where your competitors are being talked about and try to position your own product there so that your potential customers can see you. But beware: there is actually some danger in which channels you chose - tune in to find out which.
Move Past the Negativity: Whether you’re winning or struggling, there will be detractors, hard times, and negativity in more ways than you imagine. You have to do what you can to move past these negative people and situations. If it’s a customer, serve them in the best way possible (through refunds or replacements of goods) and compartmentalize the problem in a healthy way so that you can manage it, but not let it drag everything you do down.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

How Walmart Brought the Superstore into a Super App, with Cynthia Kleinbaum Milner, VP of Marketing for Walmart Plus, Online Grocery and Mobile App

info@mission.org (mission.org, Mission) — Thu, 14 Oct 2021 07:00:00 +0000

Throughout the years, Walmart has brought the idea of the superstore to life. Its name is ubiquitous, most Americans live within eight miles of a Walmart, and within the store, you can find everything from groceries to automotive services to custom paint production. Seriously, there is very little that you won’t find within a Walmart. And, on this episode of Up Next in Commerce, Cynthia Kleinbaum Milner told me about how that competitive edge is something that Walmart wanted to lean into as it evolved into the digital era. Cynthia is the VP of marketing for Walmart Plus, Online Grocery and Mobile App, and part of what she does is help Walmart use the power of its retail presence to engage with customers in an omnichannel way, this includes on mobile, which we touched on a lot in the interview. We also dove into Walmart Plus, and how Cynthia positioned Walmart Plus different from the competition, by getting the deepest understanding of what customers want and why. Plus we got into Cynthia’s own journey and how she has developed her skills as a marketer to land at one of the biggest global companies ever. This was such a fun episode, I hope you enjoy it!

Main Takeaways:

Going Backward To Move Forward: The world changes so rapidly that oftentimes the skills you are using now as the main part of your job will be peripheral or inapplicable in just a few years. Rather than continuing on one path doing only what you know, it might be a better long-term strategy to step back and learn in other emerging areas to make yourself more well-rounded. Even if you have to make a lateral or backward move right now, in the long run you will be a much better and a more skilled worker.
The Full Experience, Online and Off: Walmart is more than just a grocery store for those who go to physical locations. Naturally, the online experience had to be more than just one kind of shopping experience as well. Creating an app that makes the entire experience of shopping better, has to be the goal. Whether that means bringing in scan and go features to use in-store, or an endless aisle to shop from online, or building in additional services like financial help and delivery, there has to be more to your app so that you are providing customers with the ideal experience.
Making Membership Worth It: Too often, brands have membership programs that have one or two benefits that customers use every once in a while at best. But if you’re going to have a membership model, you want to make it worthwhile for customers and the business. There should be services that you can’t access otherwise, you should be adding value to your customers’ lives, and you should always be striving to add features and services that save time and money for your customers, which will make them want to use your app and come to your store even more.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Baby Talk: How Lalo is Changing the Buying Experience for New Parents, with Michael Wieder, Co-Founder of Lalo

info@mission.org (mission.org, Mission) — Tue, 12 Oct 2021 07:00:00 +0000

How new parents shop for their babies is unlike how anyone shops for anything else. I know, I’ve been there. You’re anxious, you’re thinking about all the things your baby will need, but you’re also thinking in stages of what you’ll need three months from now when your baby is in a completely different stage of development. It’s overwhelming and the brands in the baby market are mostly just selling products, and not selling how to have a better experience as a parent. Lalo is one of the unique brands that is putting the parent’s experience first, and that strategy has helped the company quickly grow into a favorite brand among moms and dads everywhere.

On this episode of Up Next in Commerce, I chatted with Michael Wieder, the co-founder of Lalo, about what it was like to create a new kind of shopping experience for parents, and how a little bit of light stalking went a long way to help Lalo figure out exactly what parents want and need. We talked about what it takes to bring a product to market with organic and authentic connections with influencers and consumers alike, and we got deep in the weeds of what strategies Lalo used to communicate with current and potential customers in order to improve not just the products, but the entire experience of buying products for your kids. Plus, we talked a bit about how Lalo has approached fundraising, which is a little bit controversial these days.

Enjoy the episode!

Main Takeaways:

Influencers Are People, Not A Marketing Channel: You have to tap into an influencer’s psychology and why they would actually love a brand, rather than paying them to market your product just because they are popular. Reach out to people who you know you can connect with, and ship them product to help them fall in love with the product first, then partner with you later. Not only does that form more authentic relationships, it saves you from wasting product and time on potential influencer relationships that won’t work.
Keep it 100: How you communicate with customers should be all about keeping it real. Think about how you would want to be communicated with, and treat your customers in that same way. And in order to deliver the right messages that also lead to actual sales, you have to focus on a few key pillars: technical, functional and emotional benefit.
Get on My Level: Hiring the right people is the biggest challenge to growth. Not everyone will care as much as a founder, but you need to find people who do truly care and buy into the mission of the company and will fight to help it become better. You can also tap into the people who love your brand most to bring them on as advisors.

For an in-depth look at this episode, check out the full transcript here: https://bit.ly/3zTMJOt

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Seeing and Hearing the Future, with Harrison Gross, Co-founder & CEO of Lucyd

info@mission.org (Mission, mission.org) — Thu, 7 Oct 2021 07:00:00 +0000

What do eyeglasses, blockchain, and social media all have in common? If you answered nothing, then obviously you haven’t heard of Lucyd. On this episode of Up Next in Commerce, I sat down with Harrison Gross, the Co-founder and CEO of Lucyd, a smart eyewear company that is bringing hardware and software together in pretty incredible ways.

Harrison told me all about how the company was built on IP from research universities — an underutilized trove of crazy cool ideas — and how Lucyd’s crowdfunding backers became the perfect beta testers for the Lucyd Lyte glasses, which are glasses fitted with bluetooth technology that allow users to talk on the phone, listen to music, engage with Siri, and more, all without ever taking your phone out of your pocket. Smart glasses are not a new concept, so you may be wondering what makes Lucyd different. Harrison is developing an app to pair with the glasses that uses blockchain to create a social community where people can utilize tokens, buy and sell NFTS, and engage with people and brands -- all from their eyewear. It’s a whole new kind of commerce, and I’m excited to bring you today’s conversation with Harrison Gross!

Main Takeaways:

The Will of the People: Crowdfunding is not just a way to raise capital, it’s a proven method to build a community of people who are willing to help your company succeed. Backers from a crowdfunding campaign can become a pool of beta testers and product development focus groups that can help a company get to a MVP much sooner than otherwise possible.
Meet the Market: Although the market might not be in place to adopt your original idea, you can always pivot to deliver something that people need right now. But don’t let the original idea die — find a new way to introduce that idea that is suitable to how people live and operate right now, the same way Lucyd is doing with blockchain technology, which you can tune in to hear more about!
Make it Easy: If you have a product that will solve a problem or make someone’s life easier, you might think it will sell itself, but it won’t. You have to fully explain how the product works and where they will see improvement in their life through using the product. You also have to train those who sell the product to build education into their sales speak, and every piece of content you create should illustrate how you are making life better, because when the consumer sees that, you make their purchase decision easy.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Printful’s Road To a $1 Billion Valuation, with Head of Marketing Raitis Purins

info@mission.org (Mission, mission.org) — Tue, 5 Oct 2021 07:00:00 +0000

There is no shortage of ecommerce companies popping up everywhere you look, especially in the U.S, where the culture of having a side hustle is making more and more people into entrepreneurs. Most of those companies sell products, and a lot of them also create or sell merch. That’s where Printful comes into the picture. Printful offers on-demand printing and dropshipping so that companies of all shapes and sizes can design and deliver customized products all over the world. But, according to Raitis Purins, the Head of Marketing of Printful, that’s not the main aspect of the company that has allowed it to grow to a $1 billion valuation.

On this episode of Up Next in Commerce, Raitis explains that when it comes to serving burgeoning ecommerce brands, you have to do more than deliver products to them, you have to help educate them. Printful is only successful if the companies it serves survive and thrive, and so when 9 out of 10 new ecommerce businesses fail, that could spell trouble. Raitis explained that a lot of what Printful does is create content that not only helps the company rank on Google and bring in new customers, but also helps those customers figure out their footing in this crazy world of business. Enjoy this episode!

Main Takeaways:

Side Hustles As Printful’s Main Hustle: Thanks to the culture of side hustles in the United States, there are more creators and entrepreneurs than ever before who all need merchandise. This audience is a fruitful place for companies like Printful and other personalization brands to lean into and deliver new products for.
Encouraging Success: It is extremely difficult to create an ecommerce shop that stands the test of time. Success is hard to come by, and so if you serve those young brands, it benefits you to try to help them succeed. When they thrive, so do you, so if you have tips, best practices, or other lessons that you can share with those who come work with you, sharing what you know will create a mutually beneficial, and therefore loyal, relationship.
Content, Content, Content: No one knows exactly what it takes to rank on Google, but there is consensus that content is king, and developing content around key themes, key words, and key phrases is one method that has worked before. In order to stay relevant and ranking, constantly be pushing out content around the keywords you identify as important, and build out that content in as many ways and languages as possible.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Scaling 101: How Leslie Kuster, CEO of Back from Bali, Intentionally Scaled Her Business From 5 to 7 Figures on Amazon

info@mission.org (Mission) — Thu, 30 Sep 2021 07:00:00 +0000

I want to make money. Yep, I said it, and you should too, especially if you’re an entrepreneur or business owner. It seems obvious, but, as my guest today will explain, that idea and saying those words out loud is what holds so many people back.

Leslie Kuster is the founder and CEO of Back from Bali, an ecommerce fashion brand that she scaled from 50k to multiple millions in just a few years. She achieved most of that growth on Amazon, a platform that is always challenging but can work wonders for your business if you know the ins and outs. She does and she shared them with us, including how Amazon has been changing its terms of service around images, what kind of SEO strategies will work well, and what it takes to connect with customers even when facing certain restrictions. Plus, Leslie has a ton of advice for all kinds of entrepreneurs, and women in particular, about what it takes to turn something that was more of a hobby into a business worth millions. Enjoy this episode!

Main Takeaways:

But Why?: Success in business comes down to having a vision and a “why” behind what you are doing as an entrepreneur. There are so many ups and downs, that if you don’t have a vision that will fuel you and motivate you through all of the hardships, then you will not make it through them.
Expanding In A Limited Way: When you think about expanding your business, you typically think about how to create a more broad product portfolio. Rather than bringing multiple new products to market, look at the product or products you have that are working already and expand those in creative ways.
The Toughest Question of All: Trying to figure out where to invest your dollars is the biggest challenge for an entrepreneur. And when you are selling successfully on Amazon or on your website, you have to ask yourself is it worth it to try to drive traffic elsewhere? It’s expensive to be competitive in different markets, particularly fashion, where there is already overcrowding. So rather than throw money at a channel or website that is competing against a sea of other challengers, shift your focus to an area where you can create a niche or where you are already having success.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

The Dog-Eat-Dog World of DTC Pet Food with Jinx CEO, Terri Rockovich

info@mission.org (Mission) — Tue, 28 Sep 2021 07:00:00 +0000

If you’ve heard of Casper, the mattress-in-a-box brand, you unknowingly have heard of Terri Rockovich. Terri was one of the early employees at Casper and helped the company launch into the stratosphere. Today, she’s trying to do the same thing with her new company, Jinx, a DTC dog food brand committed to helping our furry friends live their best lives. So maybe it should actually be DTD? Direct to dog?

Anyway, as Terri told me, it’s hard to make magic happen twice, especially when you’re launching a brand in the middle of one of the biggest market shakeups in history. On this episode of Up Next in Commerce, Terri told me all about how Jinx had to pivot when its retail strategy fell to pieces when stores shut their doors in 2020, and she described how directing all of the company’s focus to digital fulfillment and creative partnerships with brands like Petco, Rover and Target landed Jinx in front of a national audience faster than they imagined. Plus, Terri and I got into how disruptive brands can build a moat against their major CPG competitors. And be sure to take note of when and where you might be seeing (and maybe smelling) some doggie billboards coming soon! Enjoy this episode!

Main Takeaways:

A Moat With Many Alligators: Young disruptive brands often come to market to take on larger, established CPG companies. As a brand trying to grab market share, you might think you’d want to push out others just like you. Instead, it might be more effective for similar disruptive brands to all go after the one or two market players in order to open up even more opportunities. The disruptive brands, by definition, will be doing something different than the CPG companies, and that insulates them from being overtaken so easily, especially if they band together.
Ditching Customization: Creating a custom experience seems to be all the rage, but by creating a product that meets the needs of many, scaling becomes much easier. With a widely accessible product, you can much more easily sell, produce and ship product with speed.
Pick Your Path: If you want to compete online or in retail, you need to be sure that you show up in a way that allows you to stand out. Whether that’s through price, uniqueness of product, the consumers you’re targeting or in your marketing and packaging, there has to be something that makes people stop, look and give your brand a chance.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Making A Taboo Product a Mainstream Success, with the Co-founders of P.S. Condoms

info@mission.org (Mission) — Thu, 23 Sep 2021 07:00:00 +0000

When you’re building a business, the stakes are always high. Now think about building a company based on a product that absolutely has to work 100% of the time and the other competitors in your category have been around for a century and own about 70% of the market. That might seem like a lot of pressure, and you maybe would assume that having to succeed under those circumstances would mean working in a pretty intense environment. But that’s not necessarily the case for P.S. Condoms. The young DTC brand launched its first product in early 2020 and has been steadily building a base of loyal customers ever since. And the co-founders. Rob Seo and Raja Agnani, have made sure to bring some fun and humor to the company along the way.

On this episode of Up Next in Commerce, I talked to Rob and Raja about what it’s been like to build P.S. Condoms and why creating a welcoming, open, and fun brand has been critical to the company’s success. Enjoy this episode!

Main Takeaways:

Bringing Sexy Back: For too long, the idea of what is “sexy” has been co-opted by a few major brands. By creating a company that messages to everyone and encourages them to embrace their individuality, P.S. Condoms has opened up the opportunity to reach more potential customers.
Let’s Meet IRL: Most things are better in person or when tried first-hand. When bringing customers into the funnel — especially as a new brand — online channels will only get you so far. Meeting with potential customers at in-person events and giving them samples to use in their everyday lives is the most effective way to get people further into the sales funnel.
Keep It Clean But Still Creative: To advertise on the traditional channels, you have to follow certain rules. But those restrictions shouldn’t limit your creativity, they should enhance it. Use the rules placed on you as a creative challenge to find new and more interesting ways to connect with people.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Carpets, Catalogs, and Cutting Edge Tactics with James Pope of FLOR

info@mission.org (Mission) — Tue, 21 Sep 2021 07:00:00 +0000

Catalogs and carpeting are two things that most people think went out of style in the 1990s. But those people are wrong, and FLOR is here to prove it.

James Pope is the General Manager at FLOR, and on this episode of Up Next in Commerce, he took me through all the ways that the company is making carpet cool again through their unique, easy-to-install, and beautiful carpet tiles. But, the first question? How to find new customers when your parent company has focused on B2B customers in the past such as office spaces or hotels. Well, as they say, what’s old is new again, and FLOR’s top-performing marketing programs and main entry point for customers is… a catalog. That catalog represents 70% of their consumer demand. Wild. James really dug into the details around how they think about designing their catalogs from front to back, to tracking offline to online attributions, why holdout testing is key, and why the 80/20 rule holds true for almost everything. Plus, stay tuned to hear about FLOR’s second-most successful marketing campaign which might just surprise you... Enjoy!

Main Takeaways:

Don’t Overcomplicate: Even if you have a unique product or methodology, more often than not, consumers tend to make decisions based on what they know and already like. Try not to get too cute or complicated with how you present your product and instead, just make it easy for consumers to see the value in your product regardless of the way they buy or use it.
An Old-School Starting Line: Despite the fact that many companies are digital-first, oftentimes a customer’s starting point with a brand comes from a paper catalog they get in the mail. Brands are missing an opportunity when they ignore the more traditional means of marketing, especially now with over-saturated email inboxes and more consumers working directly from home. Digital marketing is easy to ignore, but everyone checks their mail every day, so you have a much better chance of having an impact there.
What’s In A Name?: Turns out a lot. In the search field, customers at FLOR tend to search for the branded product name rather than using generic terms. This means that not only should the website be optimized to accommodate those searches, but that it’s important to pay attention to the names you give products.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

The Circular Economy: How Avery Dennison is Closing the Gap Between The Physical and Digital World with Max Winograd, VP of Connected Products

info@mission.org (Mission) — Thu, 16 Sep 2021 07:00:00 +0000

Efficiency, transparency, trust. These are all things that both businesses and consumers crave, but don’t always achieve. Especially not all with one solution. But thanks to digital identities, and the technology that’s coming out of Avery Dennison, that’s about to change.

Avery Dennison, a Fortune 500 global materials science company, is taking digital identities past the point of simple QR codes and RFID tags, and into a place where brands and consumers will be able to do more with individual products than ever before. We’re talking about a world where you can track the tiniest details of a product in shipment, like its exact origins to its temperature. And brands will have the ability to create more sustainable, reusable products that can learn from consumers each time they use and scan the digital identifiers, making it possible to adapt to changing consumer behavior in real time. To learn more about this new circular economy, I invited Max Winograd to the show, who serves as the VP of Connected Products at Avery Dennison and one of the founders of atma.io. On this episode of Up Next in Commerce, Max and I talked about all the ways that digital identities are already being used today, and what the future holds in terms of the connected experience that digital identities provide for brands and consumers. There are so many possibilities and upsides to the technology that Max and his team are creating at Avery Dennison, so keep your ears perked up for this awesome conversation!

Main Takeaways:

Individual Focus: Investments in innovative technology is helping make possible a future that will see consumers more in control of and informed about individual product journeys. Rather than simply tracking an item from the manufacturer to its final destination, consumers can get all the microdetails of a product. So whether you are expecting a shipment of produce or medical supplies and vaccines, Bluetooth, RFID, and other digital identity technology will make it possible to keep an eye on all of the minuscule details, like the temperature of the truck the product is being shipped in.
So Long, Single-Use: How we package products is likely to undergo a fundamental change over the next few years. Rather than single-use anything, consumers will be encouraged and ultimately rewarded by having reusable individual containers that have unique digital IDs. So, rather than going to the store to buy a gallon of milk, so can have your own container, scan its QR code or other identifier at your local market, and the backend system will know who you are, what kind of milk you like (skim, oat, almond, etc.) and the exact amount, and will dispense that into your container.
A Circle Is Round, It Has No End: Consumers are much more interested in taking part in a circular economy. There is more activity in re-commerce than ever before as customers turn to the resale marketplace. The need for product-level identification becomes crucial here because you can not only trace a product's origins, you can also pass along all of its information in the resale market, including selling it to be recycled and then have the recycled materials continue to be traced all along their journey.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Seeing Clearly: How KITS Co-founder Roger Hardy has found repeated success in the DTC Eyewear Space through a customer-first approach

info@mission.org (Mission) — Tue, 14 Sep 2021 07:00:00 +0000

Imagine this… it’s 1999, and you and your sibling decide to start an ecommerce company with just a phone line, a 14k modem, a ping pong table, and a credit card. You build a website, find a product that has unnecessary margins, and decide to just.. do it better yourself. Feeling bullish on this ending? Well we are. Because that’s exactly what Roger Hardy did when building his first company called Coastal Contacts, which grew to be the world’s largest omni channel eyewear retailer. The success couldn’t be ignored, and soon after, Coastal was acquired. But one part of that sibling duo, Roger Hardy, couldn’t stay away from the eyewear game forever. He re-entered the space in 2019 with his new company, Kits.com, and by the end of 2021 the business will have already eclipsed $100 million in revenue.

On this episode of Up Next in Commerce, Roger and I got to chat about some of his secrets to success in the D2C world of eyewear. We dove into the importance of vertical integration, what the link is between a company’s NPS and its valuation, and how to think about hiring if you want to go from 1 to 25 to 100 to 300 and beyond. Enjoy this episode!

Main Takeaways:

Who’s In Control?: Vertical integration has been a hallmark of many successful DTC eCommerce companies. When you control all the levers of production, you not only can cut costs and offer customers prices they will love, you also no longer have to worry about delays or logistics problems that otherwise would be out of your control and set you back for untold periods of time.
Blend It Together: While you might have an idea of what you want to sell, if you focus only on offering your own premium products, you leave out an entire customer base that might be looking for something a bit different. By offering all kinds of products, you open the door to other customers who might not have found you otherwise. Then, once they are in the funnel, you can blow them away with a quality experience so they keep coming back for more, which is when you can present them with your product options.
Beyond Basic: As you begin to scale, there comes a point when you have to think bigger than just hiring to fill roles. Even if the person is smart and a cultural fit, the aim needs to shift to attracting and hiring people who are the best in the world in every department.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Crowding Funding Secrets: How raising $28M through crowdfunding inspired Dan Shapiro, CEO of Glowforge, to build the ultimate ecommerce experience.

info@mission.org (Mission) — Thu, 9 Sep 2021 07:00:00 +0000

Crowdfunding has been around for centuries — all the way back to the 1700s when Alexander Pope was looking for resources to publish his book. So what did he do? He turned to the people! In return for their funding, his supporters were promised a shout out in the manuscript and would receive a printed copy. Thanks to the internet, crowdfunding has been taken to another level. With easy access to billions of people — and their wallets — young companies, inventors, and entrepreneurs have used sites like GoFundMe, Kickstarter, and others to get some wind in their sails. Dan Shapiro was one of them. Dan is now the Founder and CEO of Glowforge, but before that, he had a massively successful crowdfunding campaign for a board game he had invented for his kids. Through that experience, Dan realized that there were certain elements of crowdfunding that he described as “magic” and that he thought could translate to the world of ecommerce. For his next venture, he wanted to take the high-intent visitors to a crowdfunding site on his website and get them to start converting reliably on the brand’s landing page. He wanted to build a community, and to build excitement that would turn into a flywheel of referrals and inbound leads. Oh, and he wanted to build an inclusive, mission-driven internal culture at the same time.

Well guess what. He did just that with his next crowdfunding campaign. With $100K campaign goal that ended up being blown out of the water, hitting $27M in pre-orders, he launched his next endeavor. And we dove through all the details on this episode of Up Next in Commerce!

Main Takeaways:

Beyond Crowdfunding: The conversion rate of a visitor to Kickstarter is exponentially higher than that of a traditional ecommerce site visitor. So how can you take the elements of a crowdfunding site and bring it over to a traditional online marketplace? There are certain strategies and tactics that transcend crowdfunding and harnessing that energy, excitement, and engagement can be a differentiator for a brand.
Bring A Friend: Referral programs are nothing new, but when done right, they can be a game changer for a new brand. Look at your customer base and the products they are buying from your company. If you are selling to naturally extroverted people — any kind of creator — and your product is helping them create something that they’ll want to share, tap into that natural tendency and give them incentives to share what they’re doing and how your company helped. This could lead to a flywheel of inbound customers without having to spend big on marketing.
Come Back When You Want: Repeat customers are the lifeblood of many companies. And while getting customers to return is important, how and why they do so is even more critical. You want people to come back to your company because they were delighted by the product or the experience, not because they need to replace a part that wore out or broke. Those experiences leave a bad taste in the consumers’ mouth, and you should be striving for the opposite, especially if you are trying to build a community of advocates.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Scaling from $0 to $25M at the speed of (UV) light with CEO of R-Zero Systems, Grant Morgan

info@mission.org (Mission) — Tue, 7 Sep 2021 07:00:00 +0000

What if I told you that a technology that has been around since the 1910s is the secret sauce to a company that was founded in 2020 and has completely exploded in the year since? And when I say exploded, I mean scaling from $0 to over $25 million in…. Less than a year. Well, that’s the story of R-Zero Systems, and it’s a great example of how, in today’s world, spotting an opportunity, moving fast, and being able to solve problems in real-time is what separates the winners from the losers in the business world. Whether you’re in CPG, retail, healthcare, or some combination of multiple verticals, the biggest problem a company has is the ability to sustainably scale. But R-Zero Systems is showing just how to do it well, and that’s not the only solution the company is bringing to the table.

On this episode of Up Next in Commerce, I sat down with Grant Morgan, the co-founder and CEO of R-Zero Systems, and he told me all about the wild ride the company has been on since its founding in spring of 2020. See, R-Zero is a biosafety technology company that, thanks to its innovative products, helps customers create safer spaces for its patients, employees, students, and anyone else entering an indoor space. It was created for the same reason as any other company — to solve a problem. The difference, though, was that Grant and his team were able to first, ramp up production at a time when few others could, and second, bring something critical to the very specific needs of the market that was already proven to be effective but wasn’t very accessible. Turns out, that’s the key to growing quickly is effectiveness and accessibility all at once, oh, and maybe a few other things too. Want to know what they are? Find out on this episode! Plus, listen closely to hear my epic UV product ideas that I know Grant is eager to add to his product roadmap, and some of the funniest product requests he has received to date.

Main Takeaways:

Sick and Tired of Being Sick and Tired: One of the factors that affects productivity is sick days. By finding a way to reduce sick days, a company can operate more economically and efficiently. But more than just impacting the bottom line, by investing in creating a healthy environment, you are providing workers a better overall experience.
Proof Positive: Even when you are working with a proven technique, application, or resource, when you introduce it in a new way, you have to go through the due diligence to re-prove its efficacy. Especially when what you are trying to prove is invisible to the human eye.
The Right DNA: In order to scale, hiring is key. But this task shouldn’t be treated lightly. One wrong hire can impact the culture in more ways than one could imagaine. So how do you create and keep a culture worth building around, and find the right people for the company? Tune in to hear how Grant things about hiring within a fast growing company.!

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

The Not-So-Far-Out Future with Rightpoint’s Chief Commerce Officer, Phillip Jackson

info@mission.org (Mission) — Thu, 2 Sep 2021 07:00:00 +0000

Okay, so sitting around trying to predict the future can be a pretty fun challenge. But for Phillip Jackson, the Chief Commerce Officer at Rightpoint and the Co-founder of Future Commerce, there’s no better way to spend a day — or an hour on a podcast.

On this episode of Up Next in Commerce, Phillip and I went deep down the rabbit hole of all the crazy trends we’re currently seeing in the ecommerce world, and where we expect the industry to head next. From spotting innovation in the gaming community, building the ecommerce metaverse, or working with disruptor brands on high-risk, high-reward ideas to grow a digital community, we touched on it all. Plus, if you think big retail is dead, tune in to hear Phillip’s interesting take on how that is anything but true, and how the D2C brands currently praised on Twitter are nothing in comparison to the private revolution happening in places like Target and Walmart. Just check out the GMV if you don’t believe him! This was such a fun interview, and I loved getting the chance to pick the brain of another smart, forward-thinking podcast host and ecommerce enthusiast! Hope you enjoy it as much as I did!

Main Takeaways:

Retail Takeover: The private label revolution is all around us, you just have to know where to look! Hint: Check the quarterly earnings..
Coming Together: Brands love to say they built a community. And while that might be true, the problem is that all brand communities are currently siloed. The future of commerce will be more unified as brands continue to experiment with ways to create an ecommerce metaverse by blending different digital properties, platforms collectibles, and other elements together and making them available more broadly outside of specific channels.
Game On: To get a look at where the future of commerce and technology is headed, the best place to look is often in the gaming community, where innovation happens constantly and those innovations often find their way into the real world.
Failure is Always An Option: Ecommerce shouldn’t be boring, it should be filled with experimentation, risk-taking, and big swings. Historically, bigger brands have played it safe and stayed on the prescribed path, which has meant they have been left behind by the disruptor brands that are more willing to try, fail, learn, and try again.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Website Optimization and the Importance of A/B Testing and Qualitative and Quantitative Data

info@mission.org (Mission) — Tue, 31 Aug 2021 07:00:00 +0000

Every business needs a website, and every website needs a landing page. These are universal truths. Where things become fuzzy is when you try to understand what makes a landing page good versus just good enough. The difference between having a landing page that is optimized versus one that just works could be huge: we’re talking more conversions, higher LTV, and, ultimately, more money headed toward your bottom line. So then why are brands still neglecting their landing pages? And what can they do to make them better?

I asked those exact questions to Raphel Paulin-Daigle, the founder and CEO of SplitBase, which is helping companies like L’Oreal, Diff Eyewear and more scale their websites in meaningful ways that impact their bottom line. Raphael walked me through some of the biggest mistakes companies are making when it comes to their websites, including the severe lack of patience most brands have for testing and failure. But, as Raphael explains, it’s in the experiments and failures that you learn the most. Tune in for all the insights and get ready to start running A/B tests once this episode is over!

Main Takeaways:

Math in the Real World: Turns out that statistics class you took in school is important in real life. When it comes to testing, you need to understand and adhere to solid statistical models. This means having patience, getting large sample sizes, and running tests for longer than it takes to build up a reliable data set, rather than just get some quick results that could lead to biases in your numbers.
Sweet Simplicity: Asking the basic questions, like “what do you love about this product?” is one of the best, but often-overlooked, ways to get customer feedback that will actually make a difference in marketing copy and product design. Customer feedback is critical, but gathering it has become overly complicated. Break it down to its simplest form and go from there.
Don’t Trust Your Gut: The biggest mistake most brands make is believing that they know their customers based solely on anecdotal evidence and internal brainstorming. Your gut instinct about customer personas are usually built on cliches and supposed known factors, which ultimately makes those personas useless. You have to have a more analytical approach that combines both qualitative and quantitative data in order to come up with customer profiles that can be useful to the business objectives.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Heard It Hear First: How a 3D Printer, a Super Bowl Champion, and a Team with Grit are Disrupting a 100+-Year-Old Industry

info@mission.org (Mission) — Thu, 26 Aug 2021 07:00:00 +0000

There is more to a company than just a really cool product or two. The best businesses are built on revolutionary products mixed with value-adding opportunities, marketing, partnerships, and leadership. Dome Audio has all of that in spades.

On this episode of Up Next in Commerce, I sat down with my friend Timothy Wright, a Super Bowl champion and the chief strategy officer of Dome Audio, a disruptive headphone technology that has the world’s first surround sound, bone conduction headphones. Tim breaks down what it took to build the patented bone conduction technology (sneak peak, just imagine a sketch, a cad file, and a 3d printer...). Plus, we dive into how they are thinking about licensing and IP partnerships and hint at a possibility for how they plan to utilize NFTs in the future. We also had a fun discussion that took us behind the scenes of his pro football journey with five NFL franchises that resulted in a Super Bowl XLIX ring, and lessons he has taken from the world of football and brought into his business ventures. Also, as a quick side note, I am an investor in Dome Audio, but this podcast is for purely informational purposes and not to be used to drive investment decisions. So with that, enjoy this episode with Tim Wright!

Main Takeaways:

Dream It, Build It: There are products on the market for just about everything. But who’s to say those products can’t be improved? Game-changing companies are built on ideas from people with the drive to put them into action. Use the resources at your disposal — your experience, your connections, the technology available — and iterate until you find the way to make a product that brings something unique to the marketplace.
More Ways Than One: To have long-lasting success, companies need to find multiple avenues they can use to bring value. The product is one thing, but how else can you bring a different customer base or demographic to the table? The more ways you can monetize, the better.
One Degree of Separation: To drive engagement and build buzz, you have to get in front of an audience. To do that, you have to build a team and partnerships that mirror, or are affiliated with, that target audience. The closer you can get to the people you want to reach — through brand partnerships, influencers, etc. — the better off you will be for a strong launch.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

What’s Old is New Again: How SCOUT is Leaning Into Old-School Methods to Harness the Power of Authenticity and Connection

info@mission.org (Mission) — Tue, 24 Aug 2021 07:00:00 +0000

Knowing your customer is the obvious first step to creating and selling products. But there are still companies that lose sight of who they should be targeting, where, and with what kind of content.

SCOUT is not one of those brands.

On this episode of Up Next in Commerce, Deb Waterman Johns, the Co-founder and Chief Creative Officer at SCOUT, took us behind the scenes of what it’s like to build a brand that is all about authenticity in its products, its partnerships, and its marketing efforts. Deb explains what it takes to not get pigeonholed in a certain category or vertical, and also talks us through why retail partnerships are going to be important to ecommerce brands in the years to come. Plus, she highlights how what's old is new again, not only in the world of fashion, but business too, and how their team is leaning back into some “old school” tactics to really connect with their customers in the most authentic way. And because she has been a color consultant to some of the largest brands, I had her reveal what color palettes are going to be trending in the upcoming year.

Main Takeaways:

Don’t Get Pigeonholed: Sometimes a product can be labeled as one thing and then excluded from all other categories. For example, a bag that’s seen as a gift is not often also identified as a piece of fashion. It takes strategizing to market and display your products in a way that avoids that outcome and allows you to reach all kinds of buyers.
Remember Your Day-1s: Although the move to ecommerce is in full force, it’s important to remember that there were brick-and-mortar stores that supported and carried your brands from the beginning. Retail locations and ecommerce brands have benefitted from strong partnerships since Day 1,and those are relationships that should be nurtured and leveraged to maintain contact with all kinds of customers. The benefit from ecommerce and retail partnerships exists within the opportunity to promote new and different products and build excitement with customers in person and give them more value every time they shop.
Getting Down To What’s Real: Authenticity has never been more imperative than when it comes to marketing and product development. The brands that ditch the high-gloss photoshoots and invest in more real-life, everyday content are experiencing higher levels of engagement. The same can be said for the brands that take the time to get to know their customers on a real, deep level. Understanding who you are talking to, what they like, and what resonates most with them is critical to creating content that lands and converts.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of this interview, click here.

Don’t Rain on Weatherman’s DTC Success Parade

info@mission.org (Mission) — Thu, 19 Aug 2021 07:00:00 +0000

Some products are new and cutting edge. They’re exciting and they make people rethink how they live or work. And then other products are … umbrellas. Don’t get me wrong, there’s nothing wrong with umbrellas, I just don’t find myself thinking about or buying them very often. And that’s one of the problems that Tyler Kupper says they are overcoming at Weatherman Umbrella.

Tyler is the Chief Revenue and Partner at Weatherman, and on this episode of Up Next in Commerce, he told me all about what it’s been like trying to disrupt an industry that hasn’t really seen any innovation in 50 years. The conversation was really interesting, especially because Weatherman isn’t just thinking about making a product that protects people from the elements, Weatherman has big plans that involve data, apps, partnerships, custom features, and more. Weatherman is thinking long-term, and it’s already working out great because the company has inked major partnerships in the golf world with Arnold Palmer and the Ryder Cup, and has gotten its foot in the door at big box stores such as DICKS and Golf Galaxy. And Tyler says there’s just the beginning! So grab your rain boots and prepare for an epic episode.

Main Takeaways:

There’s An App For That: Products are designed to solve problems, but sometimes products come with extras that are unique or add value. Users need to be educated on those aspects of the product, and things like apps and experiences can help brands do that.
Howdy, Partner: Niching down within certain pockets of an industry or customer base is one of the best ways to start to grow a company. By finding strategic partners that can give your brand legitimacy and put you in front of your target audience, you will be able to achieve much more growth than if you simply relied on a single digital ad channel.
Can I Get A Sample?: There is very little a company can do that is more powerful than giving potential customers the opportunity to simply use your product. If it is high quality and meets a need, getting the chance to experience it for free and making that experience memorable — from the unboxing to the collateral included — is going to make that person receiving the sample much more likely to be a loyal customer. And this is true whether you are selling to an individual or chasing a PO from a big box store.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of the interview, click here.

Building a Better Bank

info@mission.org (Mission) — Tue, 17 Aug 2021 07:00:00 +0000

In 2021, you’d think that just about everything has been digitized at this point, right? Wrong. In the world of banking, there are still local banks, credit unions, and other financial institutions that have been slow to hop on the digital bandwagon. NCR is here to help not just them, but their customers as well by providing all the technology necessary to make banking, digital payment, and other transactions possible on mobile, online, or anywhere you want. But that’s not all. As with everything from ecommerce to marketing, banking is about to get more personalized thanks to data and automation.

On this episode of Up Next in Commerce, Doug Brown, the President of NCR Digital Banking, explains it all and paints a picture of what banking will look like for the average consumer as well as businesses big and small. He also talks about how solutions can and should be implemented regardless of the business you’re in and who you should be asking to get a handle on what consumers actually need. And he dives into where and how crypto will evolve next. Enjoy this episode.

Main Takeaways:

Big or Small, Tech for All: Regardless of the size of a bank or financial institution, there is now technological capability to make them all function in the same way in the eyes of the customer. Every transaction can and should be available digitally, and the proliferation of tech like the cloud and edge computing has made that possible. This, by extension, allows for more flexibility and choice for people and businesses to choose the banks and financial institutions that work best for them.
Make It Quick, Keep It Personal: Today, consumers want two things: simplicity and personalization. They want to transact, move money, or make payments in a matter of seconds or minutes, not days or weeks. And they also want to know that when they are loyal to one bank or service, that they will be rewarded with unique, personalized deals. Those are the expectations that banks — and all consumer-facing businesses — are currently facing.
Not Even Close: Whether you run a bank or a retail store or an ecommerce shop, one of the biggest mistakes you can make is assuming you know what a customer wants or trying to bring in solutions based on nothing but trends and what’s flashy or new. More often than not, what you think is an issue is miles off from what the consumer is actually challenged with, and if you just ask them or test out a few things, you’d be able to find that out.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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For a full transcript of the interview, click here.

Becoming More Than a Brand Inside and Out

info@mission.org (Mission) — Thu, 12 Aug 2021 07:00:00 +0000

Everything you put out as a brand should be interesting, it should be relevant to your consumer, and you and your employees should be proud of the final product. So why then are so many brands finding that the people who work so hard on and actually create the marketing materials aren’t sharing the end result?

Max Summit is a marketing consultant who has worked with some of the biggest brands in the world — Adidas, Lululemon, Athleta, the list goes on — and regardless of the brand, whether they sell online or in brick and mortar, Max knows that true connection with customers start with the connection to the internal employees. On this episode of Up Next in Commerce, Max discusses all the ways that brands should be doing internal pulse checks and reinventing their mission in order to make their marketing materials hit home with consumers. Plus, she explains how brands should be thinking about ways to become resources for customers beyond just being a provider of goods and services, and she gives examples from her days at Lululemon that any company can learn from and where VR and AR can come into play. Enjoy this episode!

Main Takeaways:

Who’s Sharing What?: To gauge the health and success of your company’s creative, doing an internal pulse check is necessary. Are employees sharing the work they have produced? Are they proud and willingly talking and posting about the latest project they are working on? Do a post-mortem to gauge how a project went, what aspects were wins and where things could have gone better and allow everyone to share freely and openly how they really feel.
Who Knows What?: The boots on the ground at retail stores are often the people with the most knowledge of the consumers and what they want. Brands need to create a more connected communication structure that allows everyone in retail to interact with HQ and the ecommerce team to paint the most holistic view of the customer and then create products and marketing content for them.
Who’s Engaging with What?: One of the biggest struggles brands face is getting consumers to engage both initially, and long-term. So brands have to hook a consumer quickly, and keep bringing them back with an interesting, exciting, and valuable experience. Virtual and augmented reality experiences are a recent way that brands have been solving this problem, and the creativity and utility that VR and AR offers sets the table for it to be a major way that brands and consumers interact for years to come.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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NBC is Tuned In To Shoppable TV

info@mission.org (Mission) — Tue, 10 Aug 2021 07:00:00 +0000

One of the stats NBCUniversal likes to promote is that in any four weeks, NBCU content reaches 95% of homes in the U.S. It’s also the reason that in recent years, NBCU has started to focus more on creating shoppable content across all platforms to really take advantage of the audience it has at its disposal.

On this episode of Up Next in Commerce, I talked to Evan Moore, the Vice President of Commerce Partnerships at NBCUniversal, who explained all the ways that NBCU is connecting viewers with shopping experiences. And he told us how brands work with the company to target and attribute conversions on content of any kind. Whether consumers are reading a blog or streaming their favorite Bravo reality show, Evan says they are able to capture that already-engaged audience and bring a seamless interactive shopping experience straight to them. He also touches on what he sees as the future of shopping on connected devices, and how it isn’t just shopping, but is the future of entertainment. Plus, are you a brand thinking “how can I get on tv? I want to be part of this shoppable experience! Well tune in to hear how you can play in this world, no matter your company size.

Main Takeaways:

The Year of the QR Code: Real-world experience with QR codes have exploded mostly thanks to the pandemic and the need for touchless experiences. As more people have experienced QR codes in different places, it has made them primed to be ready to do the same thing with their media, such as with shoppable TV.
Bring The Party Too Them: When you have an audience already at your fingertips, it doesn’t make sense to try to direct them somewhere else to make a purchase. Bring the shopping experience straight to them where they are already engaging with your content, whether that’s on a social post, a blog, a TV stream, or on their mobile phone while they’re streaming.
Are You Not Entertained?: Consumers don’t mind being sold to as long as they are entertained along the way. When brands and media companies come together to create shoppable content, the goal should be to create stories that are authentic and entertaining, not to just put products in front of consumers and tell them to buy now.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Living in the Right Niche

info@mission.org (Mission) — Thu, 5 Aug 2021 07:00:00 +0000

With any new product, building brand awareness is key. But when your new product is something the world has never seen before, well, you need to do more than just make people aware, you have to educate them, too. As a DTC company, you might have a direct line to your consumers, but you still need to be able to show and teach them as much as possible, and then be there around the clock to answer their questions and hold their hand through the process.

It sounds like a lot of work, but when the product is changing the game completely, you have to be ready to get your hands dirty. And that’s just what Matt Wall and I chat about today, who is the co-founder of Principle Faucets. Principle Faucets is a DTC brand that has created the first fully-integrated foot pedal system which not only saves water, but is more hygienic and improves faucet functionality.

Matt dove into how he and his co-founders brought their foot-pedal faucet to the market, the amount of time it took to test and tweak to make it fit consumers needs, and then he goes into the process of what’s it’s been like to actually get it in front of people — a task made much harder when the pandemic caused them to shut down their mobile display unit. Here’s a sneak peak on what Wall had to say: it takes finding the right niche within the industry and then hyper-targeting your search and marketing terms toward that audience to be successful. Plus, Matt tells us how to market the environmental benefits of something like the Principle Faucet across all different geographies,who are experiencing various degrees of climate change. Enjoy this episode and use the code UPNEXT20 for 20% off on your order at Principle Faucets!

Main Takeaways:

What’s Your Niche?: It’s easy to get lost in the deep sea of products that come up when they search a random keyword. You might see people finding your product or website, but the conversions won’t be what you want. By dialing in on keywords and long-tail search phrases, you can more easily target the people who are actually looking to buy your product and then get them to convert.
Never Before Seen: When you think you have built a better mousetrap, you still need to do market research to see if consumers want what you have to offer. Bringing a brand new company into the world with a brand new product no one has ever seen before is a risk, and you have to do your research before you take the bet to go into a market with a product no one actually wants or needs.
Ease Them In: If your product requires consumer education or a change in behavior, it’s wise to build in some tie back to what they are already familiar with. Asking a customer to do something completely new is scary, and will turn people off. It’s better to give them a way to do a gradual implementation into their daily lives.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Solving The World’s Supply Chain Woes with Blue Yonder

info@mission.org (Mission) — Tue, 3 Aug 2021 07:00:00 +0000

If you break down the supply chain in its simplest form, basically what you have is brands procuring products and then delivering them to customers where and when they need them. Sounds easy, right? But if you’ve listened to this show long enough, you know that’s not the case. We’ve heard countless guests tell us just how much the supply chain impacts their business, and they’ve described a number of challenges they have encountered thanks to supply chain disruptions. One thing they all had in common — they had no answers to the problems they were facing.

That changes now.

On this episode of Up Next in Commerce, I was so excited to finally get some insight on the supply chain from a couple of guys from Blue Yonder, Omar Akilah, GVP of Product in the commerce suite, and Eugene Amigud, GVP of Product Management and Architecture. Blue Yonder is an end-to-end supply chain platform that enables companies to tackle all the problems in the supply chain, and little side note, it’s currently on track to be acquired by Panasonic for a measly $7.1B. From planning to execution, to transportation management, to commerce, to promising a customer when they're going to get it and making sure that you fulfill those promises, these are just some of the things Eugene and Omar have insider knowledge of. They dug into all of those topics and more and they shared how they help brands solve issues at all stages of the supply and fulfillment process. Regardless of the issues at hand, Eugene and Omar have heard, seen, and solved for it all. They also see the trends evolving in real time, including how important same-day or next-day delivery will be in various verticals, how and where A.I. and ML are being implemented, and what kind of difference edge technology and data will have on the entire buying and shipping experience. Eugene and Omar explain it all in this awesome roundtable episode, enjoy!

Main Takeaways:

Stitched Together: The supply chain is made up of specific pillars that can be optimized in specific ways. The way to level up and personalize the supply chain experience for brands is to stitch together the pillars and tools to make each pillar more valuable. For example, using machine learning to help do more accurate real-time inventory and then incentivizing purchase through automated couponing will lead to more sales, and also more data to further input into an ML algorithm to keep making the system better.
Knowing the Needs: Supply chain optimization is all about understanding the unique needs of a company or an industry. For medicine and pharmaceuticals, speed of delivery is critical — people need their medicine now. For grocery, being able to schedule your food to arrive on the days you need it for the meals you’re cooking is most important. Once you identify what the major need is, solving for that becomes a bit easier.
Gaining an Edge: The use of edge technology and data, combined with other execution tools like sensors, A.I. and ML, can change the shopping experience for customers and the supply chain experience for businesses. By bringing everything to the edge and utilizing new technology, real-time freshness and weather and harvest data can be used by businesses to update their inventory or upcoming orders and to inform customers of critical product information.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Coffee, Cults, and Commerce; Lessons Learned Breaking Into a $465B Industry

info@mission.org (Mission) — Thu, 29 Jul 2021 07:00:00 +0000

What’s hot today might be out of the zeitgeist tomorrow. Are people still doing goat yoga? Are skinny jeans really the new mom jeans? There are so many trends to keep track of and so many “next big things,” it’s impossible to know what’s real and what’s just a passing fad. For a business, it’s important to understand the distinction, and it’s even more important to have products that will thrive regardless of the different cycles your industry will run through.

Lopa van der Mersch says she has that kind of product with her company, Rasa, which makes a coffee alternative with adaptogen blends. Lopa has a fascinating story, including inadvertently entering into a cult, navigating tricky co-founder relationships, and building up a business to more than $2M in revenue all from her garage.On this episode of Up Next in Commerce, Lopa explains why she believes that her product will be a game-changer regardless of societal trends, and she breaks down how to spot something phony or bad for you, whether it’s in a product or even in a partner or personal relationship. Enjoy this episode!

Main Takeaways:

Finding the Right Match: When partnering with a co-founder, especially one who is a close friend, some things you should consider are their skills and their ability to resolve conflicts. Ask yourself would you hire this person to do this job if they were not your friend? And think back to how you have handled conflicts with each other in the past. If you are comfortable with the answers to those questions, you can feel more confident in that person as a partner.
Culture Shock: Growth in any industry is related to what is happening in common culture. When something is trending, a corresponding industry will rise. Today’s society is focused on health and wellness more than in the past, so companies that deal with products in that space are on the rise. But to stay solvent even when the trends change, companies need to ensure that they have products that are worth something and add to a person’s life regardless of whether it’s trendy or not.
Let It Come, But Also Go After It: Striking the right balance between organic growth and focusing energy and money into specific channels is difficult. The key is to make sure that you are diversifying your efforts wherever you choose to try to gain attention. Play with the levers of what’s working in one area, but continue to invest elsewhere so that when one thing begins to fail, you have other options.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Cooking Up DTC Success with Cuisinart

info@mission.org (Mission) — Tue, 27 Jul 2021 07:00:00 +0000

Most people probably know Cuisinart because of the company’s kitchen appliances like the food processor, air fryer, or coffee maker. Cuisinart’s products are everywhere — in kitchens around the world, in retail stores, and yes, online. In the last year or so, Cuisinart has put a much greater emphasis on the DTC part of the business -- walking the tightrope of being there for retail partners, while still making sure that there is enough inventory to meet the demand coming from online.

On this episode of Up Next in Commerce, Mary Rodgers, the Director of Marketing Communications for Cuisinart, explains the steps the company took to make the pivot to DTC without leaving retail partners in the lurch. Mary also talked about how the marketing and online pushes for products went from being planned out months in advance to changing from one day to the next. Enjoy this episode!

Main Takeaways:

From Months To Weeks To Days: Sometimes, the world moves so fast that planning in months-long cycles places you at a disadvantage. When demand, retailer needs, and inventory is shifting at a rapid pace, you need to come up with a plan that allows you to stay ahead of the curve, even if that means changing strategies from one day to the next.
Eyes On Your Own Paper: Some brands will look to their competitors to see what influencers they are working with or how they are running their campaigns, and then they will try to copy that approach. While this is tactical, it is not strategic because you are placing blind trust in another brand’s team and vision without even knowing if what they did paid off. You have to do your own homework and think about your customers’ needs and build a strategy around that rather than just trying to keep up with the Joneses.
More Than Just A Product: Brands have to think beyond the products they sell and understand how the customers will be using those products. Often, especially in housewares, consumers will be using one product in concert with another or as part of a recipe. By understanding the life of the consumer beyond purchase and coming up with content to connect with consumers after the fact, brands can create a more fruitful and loyal relationship with their customers.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Nothing In Life Is Free … Except These Samples

info@mission.org (Mission) — Thu, 22 Jul 2021 07:00:00 +0000

If it’s free, it’s for me — that’s one of my mottos. And that’s why I love free samples. But free samples are universally adored, and in recent years the customers getting the goods aren’t the only ones who are benefiting. Ecommerce companies and retailers alike are using samples as a way to raise awareness, convert more sales, and drive traffic to a product or webpage, and it’s working.

On this episode of Up Next in Commerce, guest host Albert Chow talked to Doug Guyer, the Co-founder and Director of Strategic Development at Brandshare, the company that brings many of those free samples to your door. Doug explains that sampling is a tool that any brand can take advantage of, and if they do, they could see 97% of people who get the sample try it out, and 32% of those folks actually convert into buyers. It’s a massive opportunity, but Doug also says that most brands out there don’t know that this is possible. How has Doug and the team gotten the word out — including the story of how they landed their very first campaign with Tylenol — and what should brands be thinking about when they engage in the sampling strategy? Find out on this episode!

Main Takeaways:

It’s Worth A Try: Very few marketing tactics are as effective as free samples. Reports from Brandshare indicate that well-run sampling campaigns see 97% try rates and as high as 32% conversion rates. Consumers are more willing to try something that is of no cost to them, and brands will be rewarded with both awareness and increased sales by making a relatively small investment in samples.
Building Trust: When a brand gives a free sample, or includes a related free sample from another brand in a customer’s order, the original brand is seen as going above and beyond. Customers view the sample as a sort of curated experience that was sent just for them, and it creates more brand loyalty.
Not a Cureall: While sampling is effective, it can’t solve all of a brand’s problems. A struggling company or a business that simply doesn’t have a good product will be negatively impacted by free sampling.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Refersion’s Reimagining of Affiliate Marketing

info@mission.org (Mission) — Tue, 20 Jul 2021 07:00:00 +0000

Creating an influencer or affiliate program is a huge headache for most brands. Vetting the people you let in, assigning them links and promotions, keeping an eye on their posts. And then what about tracking performance and understanding conversions? Sounds like a nightmare But it doesn’t have to be.

Shibo Xu is the Co-Founder and COO of Refersion, which was built on the idea that you could completely flip that process on its head. Instead of the burden falling on the brands, influencers have to prove their worth. And rather than getting lost in vanity metrics or other out-of-date KPIs, place value only in a select few areas. These ideas helped launch Refersion to success and helped the brands that work with Refersion, like Puravida, Impossible, and 19,000 others remove some of the challenges of influencer marketing that have plagued them for years.

Shibo talks about all of that on this episode of Up Next in Commerce, which was guest-hosted by Albert Chou!

Main Takeaways:

What’s My Motivation: Despite what you might think, cash is not always the biggest motivator for influencers. Some are driven by a desire to be closer to a brand, to explore new products or to get products for free.
And Your Total Is…: Total order value, total revenue and total conversions driven are the main metrics that will help you determine how influencers stack up against each other. When you accurately measure those three KPIs, you get a fuller picture of how an influencer is working, and whether or not they are worth continued investment.
It’s On You: Rather than vetting influencers before letting them into your affiliate network, Refersion’s strategy is to let anyone in who fills out the form, and then make them prove their worth through their performance. By putting the burden on the self-appointed influencer, brands can focus only on reviewing results and turning affiliate codes on and off based on that.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Why Burrow is Not Following the Traditional DTC Playbook

info@mission.org (Mission) — Thu, 15 Jul 2021 07:00:00 +0000

If you look on Twitter or do a quick Google search, you’ll find a ton of chatter about the foolproof DTC playbook. Everyone has ideas about the surefire ways that young DTC brands should be setting themselves up for success. Alex Kubo is here to tell you that those playbooks aren’t as written in stone as you might think.

Alex is the VP of ecommerce and digital marketing at Burrow, a DTC furniture brand, and on this episode of Up Next in Commerce, he explained how and why the Burrow team threw out the playbook when certain aspects of it fell flat. For example, Alex talks about the lessons they learned about the signals that pricing sends, and why it’s critical to put the right price on your product to attract the right customer even if that means pricing higher than the playbook says. Alex also dives into what it means to actually be customer centric and how Burrow stays in constant communication with customers. Plus, we discuss why marketing toward buying events or using a spray and pray strategy across a dozen channels is about as useful as setting your money on fire. Enjoy this episode!

Main Takeaways:

Sending The Right Signals: How you price your product or service is one of the most significant ways you signal to customers who you are as a brand and what value you bring. If you price too low, you risk being lumped in with brands that don’t necessarily fit with the type of products or value you bring to the table.
More Than Words: Saying you are customer-centric and actually being customer-centric are two very different things. To be truly customer-centric requires regularly talking to and learning from your customers and then building experiences and products based on those conversations. You can’t just assume you know what customers want, you have to do the work to find out.
A Horse of a Different Color: There are best practices and guidelines that many companies follow to get themselves off the ground. Sometimes those playbooks work, but in other cases, you have to toss out what everyone says is the right strategy and go in a new direction. Whether that’s in your social strategy, your pricing, or how you’re getting feedback from customers, don’t be afraid to buck tradition and do something different.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Taking the Pain Out of Point of Sale Processing

info@mission.org (Mission) — Tue, 13 Jul 2021 07:00:00 +0000

In-store sales. Ordering for delivery. Buy online, pick-up in store. With so many buying options accessible to consumers, companies are now facing many different kinds of orders to manage and get right. In the restaurant industry specifically, there has been a huge upswing in the number of people ordering online, especially through apps such as Uber Eats, Grubhub, and Doordash. And that’s nothing compared to the number of point of sale systems that are being used. Moving orders from an app or online system into a physical point of sale is a process that’s prone to human error, but for so long that’s been the only way to do it. Zhong Xu and Deliverect want to change that.

On this episode of Up Next in Commerce, Zhong explains how an integrated, cloud-based platform is taking the pain out of managing multiple ordering and POS systems. Plus he discusses how the real world and virtual world will start to blend together more and more as brands invest in digital-focused capabilities. Enjoy this episode.

Main Takeaways:

404 Error No More: There are thousands of point of sale systems and all of them require humans to re-enter online orders perfectly into them before they can be made and delivered. This leads to errors and dissatisfied customers. Integrating the POS and ecommerce systems is one of the most effective ways to reduce those errors.
The Real And Virtual World: As restaurants reopen dine-in services post pandemic, they are still keeping an eye on the ecommerce space. The rise of the digital consumer has made it so that restaurants are now looking to create virtual brands with specific functions and offerings for their virtual audience. And sometimes that means creating or investing in a physical space that is only used to fulfill online orders.
Addition Without Subtraction: Even though there has been an uptick in delivery and curbside pick-up orders, restaurants are still seeing strong in-store dining numbers. This means that restaurants can invest in delivery and ecommerce tools to improve the customer experience without worrying that doing so will cannibalize in-house dining.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Coming in Hot: How Truff Sells Products … By Not Trying To Sell Products

info@mission.org (Mission) — Thu, 8 Jul 2021 07:00:00 +0000

Business owners, operators, marketers, really anyone who works at any company is always aiming to do one thing: sell products. So when Nick Guillen and Nick Ajluni, the co-founders of Truff, say their strategy isn’t solely focused around this, it makes you sit up and listen. At least, that’s what I did when I heard what they had to say.

On this episode of Up Next in Commerce, the two Nicks explained how they built their truffle-infused sauce brand by reverse engineering products specifically to live and resonate on social media, and then why they decided to lean into creating epic content without attaching CTAs. It’s an interesting idea, and one that has worked pretty well for them, actually. After all, Truff is the No. 1 hot sauce brand on Amazon and was included on Oprah’s favorite things list two years in a row. So how is Truff creating content that brings people in without being transactional, and what platforms are the Nicks most excited about in the future? Tune in to find out!

Main Takeaways:

The CTAs are MIA: Social media should be viewed as a friend-to-friend communication platform and a place to build relationships, not just a space to add a discount code to a post or a picture and try to get people to click. By taking the transactional messaging away from social content, you become a brand that seems more like a friend putting out content you actually want to see, rather than an ad people scroll past.
It’s Never Too Late: On a platform like Tik Tok, it is never a bad time to join. Because the platform rewards the content as opposed to the number of followers an account has, all you have to do is create one piece of content that hits just right to find success and go from nothing to selling out your products in seconds. But you have to be willing to experiment and try everything to find the right kind of content that will resonate.
Don’t Rush Into Retail: In many cases, the best route for new brands is to start small and establish yourself and your consumer base before trying to move into the retail market. In retail, there are numerous costs, fees, and sales expectations that all create a burden on the brand, not the retailer, so before committing to a retail path, ensure that you have a strong digital foundation you can build off of and then create an omnichannel experience from there that includes but is not dependent on retail.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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What It Takes to Break Through in China

info@mission.org (Mission) — Tue, 6 Jul 2021 07:00:00 +0000

From starting a hedge fund to owning the DTC beauty market in China is a career path you don’t hear too often. But that’s the winding road that Julian Reis has traveled and along the way he’s picked up some critical intel about the ecommerce world and Chinese trends that he shared with me on this episode of Up Next in Commerce.

There are a bevy of factors to take into account when entering the Chinese market. From the vast differences in the way consumers shop in China to the sheer volume of consumers that can make a huge boom in sales in a matter of moments, there is a lot to contend with. And how does a brand even get in front of a consumer without traditional ads or email marketing? And what about social media? Or regulations? Julian explains how to take all that information into account and build an ecommerce strategy that lets you win abroad. Plus, he dives into how his company, SuperOrdinary is working with top skincare brands to enter the Chinese market, and some of the experiences that can be expected when embarking on this new path. What a fascinating discussion that was so different than any interviews I have had so far, enjoy!

Main Takeaways:

It’s All Chinese To Me: Brands might want to expand to the Chinese market and believe that there is a huge opportunity there, but rushing into the market without doing the proper research could be a huge mistake. Despite the fact that a lot of information is censored in Chinese, consumers there still find ways to access the content that is important to them. Brands need to get more social awareness, learn about what Chinese consumers are interested in and let their actions reveal whether or not you have a product-market fit before trying to make a splash in that market.
Platforms vs. Pages: There has been a bifurcation of ecommerce between platforms and webpages. The debate about where to invest more is coming down to how you see your customers acting. SuperOrdinary’s theory of the case is that platforms are the way of the future because at the end of the day, customers spend more time on Amazon and Tmall than on a company’s website. Therefore, more focus should be on creating content that drives engagement on those platforms.
Boom and Bust: In China, the volume of consumers is so much higher and there is so much more emphasis on influencers and celebrities, that if something goes viral, a brand could do millions of sales in a matter of seconds. Being prepared for that kind of boom is very different from working in the U.S., where you prepare for steady growth over a longer period of time.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Shifting Foundation of Ecommerce

info@mission.org (Mission) — Thu, 1 Jul 2021 07:00:00 +0000

The future of commerce is being built all around us, and while so much of the industry changes on a daily basis, there are still some fundamental truths that anchor brands and allow them to find success in the digital and retail worlds. On this roundtable episode of Up Next in Commerce, I got to dig into exactly what those foundational elements are with Mike Black, the CMO of Profitero, and Diana Haussling, the VP and General Manager of Digital Commerce at Colgate-Palmolive.

This was such a great discussion that touched on so many different topics that brands big and small should be paying attention to. For example, what are the three key levers that influence ecommerce sales? How should you be developing KPIs that will actually mean something and lead to more profitability and growth? Why is omnichannel the way of the future and what channels should companies be investing in? Mike and Diana have the answers, which they have gathered through long and impressive histories in the ecommerce world — Mike worked at Staples and Nielsen, and Diana has held roles at places like Campbell’s, General Mills, and Hersheys. These two really know their stuff and they were so much fun to talk to. I hope you enjoy it as much as I did!

Main Takeaways:

Pulling the Right Levers: There are three basic levers that influence ecommerce sales: availability, findability, and conversion tactics. If you can’t ensure that you reliably have products to offer people, that those people have an easy way to find the products, and that they are given reasons to actually make a purchase, you won’t be able to grow or increase profits.
You Reap What You Sow: Being a first-mover on any platform is one of the investments that has the highest potential payoffs. Companies that took Amazon and Instacart seriously from the get-go have created a huge advantage for themselves in the ecommerce space. By having a head start in one place, you also free yourself up to explore elsewhere while your competition tries to keep up in the first spot you’ve already dominated.
You Want Them to Want You: As a brand, you have to firmly establish a value proposition to present to customers, especially when you are trying to extract information or gather data about them. Give customers concrete reasons to want to engage with your brand and earn their trust so that they are more likely to keep coming back. Then use the data they give you to provide even better experiences and products over and over.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Don’t Flush The Fundamentals

info@mission.org (Mission) — Tue, 29 Jun 2021 07:00:00 +0000

The best way to learn something is by doing, which is a lesson that Thomas Lotrecchiano’s father taught him early on. Thomas and his father started Omigo together in 2018 as an alternate route to Thomas going to school for an MBA, and in the years since, that lesson keeps cropping up.

Omigo is a DTC bidet company, and like many industry disruptors, its biggest challenge is educating the consumer base and converting skeptics into loyal customers. On this episode of Up Next in Commerce, Thomas explains how they have done exactly that by blending humor and educational content, building an infrastructure that allows them to ride the changing tides of demand, and by betting big on TV moving forward. Plus, Thomas shares some of the lessons he has learned from his father, who is an ecommerce gamechanger in his own right, having grown a small online business from a modest five employees to 250 in the early days of the industry.. Enjoy this episode!

Main Takeaways:

How Long Will It Take?: Getting consumers to adopt a new product, especially an intimate one, requires a great deal of education, patience, and listening. Just because your product works flawlessly and it has certain innate benefits doesn’t mean that it will immediately be a hit. You have to invest in educating the consumer base and then listening to and incorporating their feedback into your products and messaging.
Don’t Overlook the Obvious: It’s easy to fall in love with your product and spend time and money selling its unique features, but what actually makes people convert is if you can show them how to use it, how to install it, and lastly the value that can be derived from it. Those are the conversion areas that you should be laser-focused on, and highlighting any of the superfluous features can come later.
Basic Building Blocks: There are three fundamental elements that DTC businesses need to start with before getting their company off the ground. They are: customer service, fulfillment, and a functioning, lead-generating website that has the ability to scale. Without these building blocks, your company is not ready to scale.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Future of Transactions: The President of NCR Retail on Reinventing the Buying Experience

info@mission.org (Mission) — Thu, 24 Jun 2021 07:00:00 +0000

The stores of the future are being built today, and according to David Wilkinson, President & General Manager of NCR Retail, they will not be the types of stores that currently come to mind. We are living in a time that blurs the lines between digital and physical, and retailers are working with NCR to make every experience as seamless as possible. David explains how on this episode of Up Next in Commerce.

He tells us how personalized shopping will be brought to the forefront through first-party branded apps that customize the shopping experience for you. And he details how retailers in all industries can start breaking free of the traditional shackles of standard point of sale technology and store designs. Plus, David and I nerd out about how cryptocurrency will be entering the mainstream sooner rather than later, and how retailers can prepare for what that will mean for their payments systems. Enjoy this episode!

Main Takeaways:

Tech First, Differentiation Later: Retailers in every industry are trying to find ways to differentiate themselves and create memorable experiences for customers. But in order to ensure quality customer experiences, the basics of how your store functions need to be flawless. Focus first on optimizing all point-of-sale technology and other digital or tech offerings so that however the customer wants to transact, they can without friction. Then, when that is running smoothly, you can begin to focus on the peripheral experiences that separate your store or brand from the rest.
Freeform Future: Anyone looking to create a store or business today has more freedom than ever before. They are no longer locked into the old ways of doing things. Traditional points of sale can be rethought. The design of a grocery store can be revamped to cater to more personalized experiences. Fast food restaurants can completely forgo inside dining. So many new options are on the table because in 2020, consumers proved to be willing to adapt to all kinds of new experiences.
Going Beyond The Loyalty Program: The days of trading your phone number for a discount code are long gone. These days, if a consumer is giving over personal information, they want something substantial in return. Brands have a chance to create loyalty experiences that are personalized and incentivize activities outside of the store, such as on social media, to give their consumers a unique reason to sign up.
Crypto Checkout: Cryptocurrency is more than just a buzzword — it’s likely to begin infiltrating daily life, particularly how people buy and sell goods. Majority of cryptocurrency holders would be willing to pay for their goods with their crypto, and retailers have to start figuring out now how to create systems that would make those transactions possible and secure.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Getting in the Weeds of Expanding All Kinds of Businesses

info@mission.org (Mission) — Tue, 22 Jun 2021 07:00:00 +0000

There are very few industries that are growing as fast as the cannabis industry, which saw about $20 billion in sales in 2020, and that number is expected to double in the next five years. With that much potential profit and opportunity available, getting into the cannabis game is something that a lot of folks are starting to jump into. But as with any other industry, there is more to it than just the product itself. Manufacturing, distribution, expansion and regulation all play a role.

Liz Wald has experience in all of these areas, and she is putting them to use as the Chief Strategy and Digital Officer for Good Earth Organics. Liz has a long and impressive history in the digital world, having gotten her start at places like AOL, Etsy, and Indiegogo.

On this episode of Up Next in Commerce, she guides us through all of it, including the trials and tribulations of turning an ecommerce marketplace such as Etsy into an international player and what other companies can learn from that journey. Plus, she talks about building partnerships, expanding into new markets, and how all of that will happen in the cannabis space. Enjoy this episode. And as a special treat, from 6/23/21 - 7/7/21, enjoy 20% at checkout on Good Organics orders by entering the code UPNEXT20.

Main Takeaways:

International Interests: Companies, especially ecommerce companies, can sometimes think they are ready for international expansion before they actually are. In order to not get in over their heads, companies or marketplaces that want to expand internationally should start with countries similar to the one they already operate in — they speak the same language, use similar payment methods, and have common standards and practices. Once expansion there is successful, they can continue to seek other opportunities abroad.
Partner Up: Sometimes the best way to reach potential customers in a new market is to partner with companies that already have those customers’ business. In the case of Good Organics, reaching new customers in Oklahoma or New York means forging partnerships with distributors of other goods and services that target customers need, and bringing the conversation into that space rather than trying to reach them elsewhere.
Work Smarter, Not Harder: There is nothing wrong with riding the coattails of a big industry boom. If you can position yourself as ancillary or as an offshoot to the main product or goods that people are rushing to purchase, then you have just as good of an opportunity to be successful, and you don’t have to compete with the big guys who are dominating the game in the main space.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Shake Shack’s Ecommerce Shake Up

info@mission.org (Mission) — Thu, 17 Jun 2021 07:00:00 +0000

When Steph So joined the team at Shake Shack in 2019, she was excited for the opportunity to grow the digital side of the famous burger company. She had set high ambitions, hoping to grow their digital channels between 25 and 50%. So when COVID hit, and all of a sudden digital grew by 400%, you’d think that Steph would feel like she bit off more of that burger than she could chew.

Not so fast, because as Steph says, digital can scale, and much like you can uplevel your combo from a medium to a large, Shake Shack was able to handle the higher traffic while at the same time coming up with new, innovative ways to make the customer experience on digital even better.

On this episode of Up Next in Commerce, Steph explained how she and the team handled an influx of 1.8 million new customers within a year and how they created the most seamless digital experience possible. Steph says that the secret Shack sauce on top of the digital experience all comes down to choice. The success of the company depends on giving the customers everything they need to feel like they are getting the full Shake Shake experience however they want it, whether that’s in-store or online and nailing that omnichannel strategy is Steph’s holy grail. Hear how she’s nailing it right here! Enjoy.

Main Takeaways:

Digital Scaling Is Not Your Problem: When a company starts to see an increase in digital traffic and sales, the immediate thought is how will the backend systems hold up? What you should also be paying attention to is how will your logistics and operations adapt? Supporting a retail location is different than supporting a delivery-based business, and all facets of the company need to be ready to meet the new demands, not just the digital team.
When Two Worlds Collide: Brands are trying to figure out the best ways to bring in-store and personal experiences together with the digital journey. When your brand identity is around being a gathering place for people to come to, it is a challenge to shift that messaging and that experience to a digital platform. By creating digital options and building physical spaces that work in conjunction with the online platform, the two worlds can become complementary.
Long-Term Option or Short-Term Trend: Things like pop-up shops and ghost kitchens might seem like all the rage and offer a quick, simple way to scale, but the question remains whether they will stick around long-term. Quality is often the reason first-time customers become repeat customers, so if brands aren’t investing in creating the highest-quality experience and product, they likely won’t be able to stay successful long-term.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Brands + Influencers: A Two-Way Street

info@mission.org (Mission) — Tue, 15 Jun 2021 07:00:00 +0000

The relationship between a brand and an influencer is a two-way street. And even though that sounds obvious, even the most successful brands and influencers are struggling to see ROI from their content.

Tessa Barton, AKA Tezza, has experiences on both sides of that spectrum. She is an influencer-turned-entrepreneur, whose company — also called Tezza — has seen its ups and downs in the five years she’s been working on it.

On this episode of Up Next in Commerce, Tezza explains how she went from cold reach outs to Urban Outfitters to leveraging a following of more than a million people to building a company all on her own. She discusses how both brands and influencers should be thinking about putting their best foot — and content — forward and what kind of creative and distribution process has had the most success. Plus, she talks about the lessons she learned when she launched her very first product expecting immediate success and then being able to count her orders on one hand. She turned things around, though, and you’ll learn how she did that and more on this episode!

Main Takeaways:

Show Em What They’re Working With: In a world where everyone wants to be an influencer, brands need to know that whoever they invest in will be worth it. With brands being more scrupulous, the smart content creators and influencers are being more proactive and showing exactly what kind of content a company will get when it partners with them.
Only One DM Away: Thanks to the myriad of platforms and channels companies operate in, there has never been a better time to get in touch with them on a one-to-one level. This connectedness is a mutually beneficial scenario because customers, potential partners and brands are all only one message away from forming a lasting relationship.
Talk Their Ears Off: Even the biggest influencers in the world can’t just come out with a product and expect to sell out in the blink of an eye. Selling is a constant action, and whether you are a brand or an influencer, you need to constantly be putting your products in front of people, talking to potential buyers, gathering feedback and data, and pivoting as necessary. Then you have to do that all again.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Reimagining Retail

info@mission.org (Mission) — Thu, 10 Jun 2021 07:00:00 +0000

Traditional retailers are facing different levels of competition from all these new ecommerce brands that have popped up recently, and are now being held to new customer expectations that many predicted wouldn’t occur for years. Because of the acceleration of digital platforms and online shopping over the last 18 months, brick and mortar stores are in a scramble to catch up or risk being kicked to the curb.

Helping retailers take charge of their digital transformation journey and get in on all of the online action is Sensormatic, which serves retailers with IoT technology to help them with things such as inventory intelligence and accuracy, gathering shopper insights, converting foot traffic, and more.

Subramanian Kunchithapatham (KS) is the Vice President of Engineering at Sensormatic and he’s been up close and personal with the brands as they implement the new technology that will allow them to compete in a digital world. On this episode of Up Next in Commerce, KS tells us what he’s been seeing in the world of retail and how he anticipates the industry changing in the coming months and years. For example, he gives us the scoop on how Sensormatic partnered with Intel to turn already-installed store cameras into an A.I.-powered Smart Hub — basically an intelligent store that can provide insights into occupancy, foot traffic, track inventory, and even provide a personalized experience for customers if they have opted in. Hear all about that solution and others on this episode!

Main Takeaways:

So Trendy: Retailers have a number of new trends to keep up with if they want to compete with ecommerce. Thanks to the rise of online shopping, consumers are experimenting with and discovering new brands more than ever before, which means the customer loyalty traditional retailers have enjoyed is crumbling. Additionally, when consumers do show in-store, they want to do more than just shop, they want an experience. Retailers have to adapt to meet these new expectations by offering new omnichannel and cross-platform shopping experiences to meet customers where they are.
Train, Train, Train: To digitally transform any organization means that there has to be an investment of not just money, but time. Employees need to be trained on new technology and strategies for using the data you gather, and the A.I. or machine learning systems you put in place also need time to be trained on the types of data and information they should be gathering and presenting to create the most value.
A Future Full of Livestreams: Recently, retailers have been experimenting with the concept of livestream shopping — a brand will livestream an event and promote items, and those watching the livestream can buy the items right from that screen. This type of interactive and streaming shopping experience is going to become more popular as technology continues to advance and as the younger generation pushes that expectation forward.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Growing, Failing, and Healing: Stojo’s Journey in the Omni-channel Space

info@mission.org (Mission) — Tue, 8 Jun 2021 07:00:00 +0000

That first online sale plus the first time a retailer agrees to carry your product are always exciting. But when you can’t meet the demand of your online customer base or your design process is slowed and shipments are delayed, that’s when the headaches come twofold.

But when your mission, and your product, is something you truly believe in and think can leave a lasting impact, you take all the good with the bad and keep on pushing forward.

For Stojo, a company that produces collapsible, leak-proof cups and containers, there have been wins and losses of every kind, and CEO Jurrien Swarts has been riding the waves as his company tries to get a piece of a $22 billion industry. On this episode of Up Next in Commerce, Jurrien takes us through what it has been like to design, launch, and distribute Stojo’s game-changing product. Plus, he guides us through how difficult it is to scale and market a business, and what it takes to make hard choices like laying off and rebuilding a staff. Enjoy this episode!

Main Takeaways:

Digging the Design: When it comes to delivering a product out to the market, it has to work in a number of different ways. The internal team needs to be invested in the design and believe in that product, but you also have to be willing and able to take outside feedback from customers in order to iterate and expand. Find stakeholders who can contribute in meaningful ways and trust them to keep making the product better.
Punch Above Your Weight: Sometimes you have to get scrappy and find ways to compete without the help of big budgets or a ton of staff. In these instances, there are avenues to explore that offer high returns for very little investment as long as you can find the right partners. Influencer marketing is one of those areas and, when small companies make the right connections, they can compete at or above the level of any big brand.
Sharing is Caring: In the past, it was uncommon and even frowned upon to share information, best practices, financials, or anything else that could be seen as a competitive advantage. The younger generations, though, value transparency and many DTOC and DTC brands that are run by millennials and Gen Z are embracing the idea of information sharing in order to help themselves become more data-driven.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Most Engaging Avocados on the Internet

info@mission.org (Mission) — Thu, 3 Jun 2021 07:00:00 +0000

It’s not easy to keep a digital audience engaged. And it’s especially hard when the product you’re trying to engage them with is … produce. And yet, Avocados From Mexico has set a gold standard for what it means to build a funnel and engage an online audience and it has somehow found the secret recipe for success (and also guacamole).

On this episode of Up Next in Commerce, I was excited to talk to Ivonne Kinser, the Head of Digital Marketing and Ecommerce for Avocados From Mexico, and learn her many tales about how the company has used out-of-the-box ideas to take something that rarely gets marketing love — produce — and turn it into must-engage-with content. She took us behind the scenes of creating one of the top digital campaigns for multiple Super Bowls, and she dove into what the future of digital marketing looks like, including why Avocados From Mexico has been ahead of the trends when it comes to things like NFTs and blockchain. Enjoy this episode!

Main Takeaways:

Impressions Matter: Impressions are a metric that often is hard to really judge the importance of. But when you can correlate impressions to search activity, it becomes clear that building an awareness of the brand through impressions and exposure can drive conversations on social media. This in turn leads to more Google searches and native activity on a brand’s page.
Eternal Iteration: You have to iterate constantly in order to adapt to changing consumer behavior. Constantly changing your platform is not a signal that your platform is failing or wrong, in fact it’s a sign that you are staying on the cutting edge and trying to meet consumer expectations at every turn.
The Powers That Be: When setting a path for the future, it’s important to differentiate between trends and fads that will come and go and the forces that will actually drive companies and consumers toward a new way of operating long-term. For example, rather than get caught up in the hot new social network or gaming platform, think about investing in the technology that powers that network (A.I., ML, 5G, AR/VR, etc).

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Reaching Higher Peaks: Lessons from Experiencing 100% YoY Ecommerce Growth with DICK’S Sporting Goods’ Scott Casciato

info@mission.org (Mission) — Tue, 1 Jun 2021 07:00:00 +0000

The online buying experience is always evolving, so it’s table stakes for companies to be on their toes and ready to adjust when the market tells them to. Especially when the company we are chatting about today was founded in 1948! But being prepared to adjust and actually making it happen are two different things.

At DICK’S Sporting Goods, its customers, who are referred to as “athletes” are truly running the show, and Scott Casciato, who serves as the VP of Omni Channel Fulfillment & Athlete Service at DICK'S, is the man who takes their needs and delivers a seamless experience to them via DICK’S ecommerce platform and throughout their 700 retail locations. And with their ecommerce sales increasing by 100% in 2020, Scott and his team have had to rethink many things like: how to scale up operations during peak seasons, why testing every iteration on the website is key, how to perfect the buy online pick up in-store experience, and determine how to take their athlete's feedback and transform it into a funnel for change. This episode brought back a lot of nostalgia for me, thinking about the days of wandering the aisles of Dick’s in my high school days looking for a new lacrosse stick or soccer shoes. So it was fun to hear about how much has changed, and what investments the company has been making lately in creating the best customer experience possible for its athletes. Also, tune in to the end to hear Scott discuss the importance of great vendor relationships, how to future proof logistics, and the new in-store experiences that Dick’s is betting big on. Enjoy!

Main Takeaways:

The House Don’t Fall When the Bones are Good: Having a strong foundation is the most impactful thing a company can do to prepare for surges in traffic that might come during peak seasons or after highly-successful campaigns. You have to do the work, go through the load tests and constantly be improving the technology stack because there are no shortcuts when you are creating a scalable platform that can withstand anything you throw at it. With last year being a perfect case study to reflect on, dive into the data and pivot if needed so you’re ready for the surge!
Bet On It … Then Test It: Building out an online experience that works requires constant testing. You can plan for outcomes and bet on how you think people will react, but until you test it, you can’t ever be certain. As Scott mentioned, following the path the data reveals can be surprising and sometimes opposite of what your intuition is telling you.
Experiences For The Future: The shopping experience is going to continue to change, and the strongest companies are planning for the future by paying attention to trends and then creating experiences — both in-person and online — that will drive engagement with consumers and build trust and confidence in the company’s authority in the space. By investing early into an experience or a specific market, you set yourself up as the expert in that specialized vertical and become the retailer of choice for consumers.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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An Ecommerce Strategy (and Product) To Make You Feel Good

info@mission.org (Mission) — Thu, 27 May 2021 07:00:00 +0000

It seems like selling a product that is designed to make you feel good should be a cake walk. But as we all know, business is never easy, especially when you’re breaking into the supplement and nutritional bar space, which is overcrowded with industry giants such as Clif bars and KIND. So what’s an upstart company with a solid product and good intentions to do?

On this episode of Up Next in Commerce, we found out when we talked to Chris Bernard, the co-founder, CEO and Chief Mood Officer for Mindright, the good mood superfood. As it turns out, there are a few ways that a small new company can make a splash, especially in the digital space. Chris explains how organic reach outs and authentic connections formed through his partnership with Rob Dyrdek has helped Mindright create an influencer and ambassador community that wins against influencer fatigue. Plus Chris, he digs into why a content strategy that blends humor and education is what gets the attention of the digital audience. Enjoy this episode.

Main Takeaways:

Be Serious… But Have A Laugh: Fun and funny content is a great way to build a relationship with consumers and to sell the lifestyle that you want your brand to be about. But you also have to balance real education and sales tactics into your content along with the comedic elements so that customers can get the full picture of what a brand is, why they should buy it, and to convince them to complete the purchase.
Can I Get A Sample?: Free samples used to be a staple at grocery stores and markets everywhere, and those samples were a key way that new companies created buy-in with potential customers. Now that the industry has shifted away from that model, finding a new way to hyper-target customers with influencers, deals, and content is the best way to bring customers into the fold.
Influencer Fatigue: Consumers are wise to the influencer strategy these days, and their fatigue is real when it comes to consuming influencer content. In order for brands to fight that fatigue and win engagement, building buzz around future products rather than current offerings is one of the best ways to do it.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Customer Loyalty as the Key Ingredient for Success

info@mission.org (Mission) — Tue, 25 May 2021 07:00:00 +0000

Repeat customers are the heart and soul of just about every business. But when your product is something that you purchase maybe two or three times throughout your life, how do you create a repeat experience that will sustain your company long-term? That was one of the questions that Chip Malt had to answer when he co-founded Made In Cookware, a digitally-native kitchenware company that launched in September 2017 and is disrupting this $17B cookware industry.

And the solution he came up with was a good one: produce the highest quality products possible, have a deep understanding of the industry you’re entering into, deliver an all-around experience that goes beyond those products, then keep scaling to bring more must-haves to market.

This episode was such a fun one because we dove into the history of the cookware industry, long term partnerships they’ve set up in France (their knives are made from the great-great-great-granddaughter of a French knife maker who invented the modern chef knife in the middle of Central France), secret recipes for their cookware ingredients, the best cooking tip he ever learned, and more. Enjoy this episode.

Main Takeaways:

Make It Memorable: Customers today are looking for experiences. In order to secure a sale or differentiate your brand, bringing a next-level experience to the table is a proven tactic. Partner with the people you are connected to in your industry — influencers, celebrities, etc. — who are fans of your brand and create something special for potential customers.
A Living Legacy: Connections are made constantly in personal and professional life. Smart business owners use those connections to their advantage. When you can tap into a reservoir of friends, friends of friends, family connections or business relationships of the past who can speak on your behalf or join you in a new venture, you immediately start to create a sense of legitimacy that can spread more easily to those you have yet to connect with.
First Time, Best Time: There are many examples of brands that have launched products quickly because they thought it was better to get a product to market than wait for perfection. But the opposite approach is also worth consideration. Rushing a product to market that isn’t up to your brand standards might be what dooms you with new customers who find you for the first time through this subpar product and then judge the entire brand based solely on that experience.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Knocking Out Knock-Offs: A Look at Crowdfunding and Copycats

info@mission.org (Mission) — Thu, 20 May 2021 07:00:00 +0000

Taking a company from $1 million to $100 million is no easy feat — especially when you have competition and copy cats coming at you from all angles. But Peak Design has fought off all those knock-offs — including a pretty blatant rip-off from AmazonBasics — and it has done it with humor and panache, which has only endeared the company more to its loyal customer base. Those customers are what took Peak Design from a simple camera utility bag company and turned it into a popular everyday bag and accessories outfitter for photography enthusiasts. Peak Design leaned into the idea of having a close relationship with its customers from the very beginning, by letting their customers have a say in their product line by way of crowdfunding and Kickstarter campaigns. And that, according to Elish Patel, the VP of Growth and Digital at Peak Design, has made all the difference.

On this episode of Up Next in Commerce, Elish explains how building that loyal customer base has helped the company stave off the blatant and more subtle competitors. And Elish talks about how Peak Design is using unique marketing and content strategies to take people from browsing to buying. Enjoy this episode!

Main Takeaways:

It Speaks For Itself: Although Peak Design went toe-to-toe with Amazon after it knocked off a Peak Design product, more often than not, Peak Design lets its products speak for themselves against the competition. If your products are truly superior in quality and the value they offer, consumers will recognize that and make the investment. And when they buy the better product and see its superiority, they become more loyal to that brand long-term.
Products Over People?: Hiring good talent is important, but you don’t want to prioritize growing your headcount over maintaining a laser focus on creating a good product. When you scale up your headcount, it’s easy to be distracted by the new focus on managing a large team and therefore your product design and development process can suffer. By relying on third parties and vendors or partners to do work you could otherwise hire internally, you are left with a core team who can focus on the part of your business that is truly important.
More Than An Impression: With your marketing and content, the goal should be to achieve more than an impression or a like. Especially with a smaller or niche brand, being a part of the conversation your consumers are having on places like Reddit and TikTok is worth more than getting an influencer to post a picture with one of your products.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Migrating a Fourth-Generation, Family-Owned Business Online

info@mission.org (Mission) — Tue, 18 May 2021 07:00:00 +0000

Within the last five years, outdoor gear company Sherper’s has gone from less than one percent of its business revenue coming from ecommerce to now having a 50/50 split between in-store and online. And for this fourth-generation family business, that move to online has been both challenging and rewarding.

As an old-school mom and pop business, Sherper’s has always prided itself on building personal relationships with customers and providing a level of customer service you won’t find with the big guys or digitally-native companies. So finding a way to create a digital experience that allowed Sherper’s to scale its operation yet maintain a personal touch was a top priority for the company. Leading the way in that journey is Nathan Scherper, the President of Sherper’s, who has come a long way from those days of scrubbing toilets for the family business when he was just 12 years old.

On this episode of Up Next in Commerce, Nathan takes us behind the scenes of how Sherper’s built out its ecommerce platform, what its competitive edge is over the Amazons and Walmarts of the world, and how the Sherper’s online platform performed when the pandemic forced more people than ever before online and in search of outdoor goods to cure their cabin fever. Plus, Nathan provides some insights into what it takes to keep a family business running for multiple generations, and why hiring talent is less about skills and more about personality. Enjoy this episode!

Main Takeaways:

Hire The Person, Not The Resume: Personality matters and should be a driving force in your hiring process. Most people can be trained to do a job, so the key thing you have to do is identify the person you want to hire and understand their current skill set. Then, gauge what they are willing and able to do for the company and train them to do what makes sense.
Compete Where You Can Win: It’s tempting to go all-in on paid advertising to try to compete with the big guys. But if you’re a smaller company or start-up, there’s no way that your budgets will be able to match those of the giants. Your investment is better spent elsewhere, like finding a niche influencer who can form an actual connection with your customers. So find where you get the most bang for your buck.
Pent Up Demand: Many people believe that as the world opens back up, the desire to get out and shop is going to lead to a boom for retail, particularly small businesses. Customers have learned that they can buy necessities from the big guys online, so the weekend outings are more likely to be to local shops and restaurants and will lean more toward impulse buying.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Doubling Down: Stanley Black & Decker’s Investment In Ecommerce and Inclusivity

info@mission.org (Mission) — Thu, 13 May 2021 07:00:00 +0000

Most people would think that a company in the Fortune 500 wouldn’t have much work to do to stay on top and compete against scrappy start-ups. But in the world of ecommerce, companies large, small, and in between are all on somewhat level playing fields, and oftentimes, the bigger, legacy companies are running behind the younger brands.

For Stanley Black & Decker, this was the case when it came to the company’s ecommerce business, which is why SBD announced a goal to double its online sales in order to re-establish itself as a leader in all areas.

Katherine Bahamonde Monasebian is the President and GM North America Commerce for Stanley Black & Decker, and she has been leading that charge since joining the company in early 2020. Katherine entered the world of retail, having cut her teeth at places such as Lululemon, Barney’s, and Juicy Couture, but she’s always loved a challenge, and going from the hardest-hit industry in the pandemic (apparel) to the top-performing vertical (DIY and home improvement goods), was one of the biggest career shifts she had ever made.

On this episode of Up Next in Commerce, Katherine explains why she made the decision to role up her sleeves and join Stanley Black & Decker, and how she has grabbed the company’s lofty ecommerce goals by the horns and got to work. Katherine discusses what it takes for a large company to experiment with new platforms, and how she measures ROI and attribution to assess risk, and she looks into the crystal ball to predict how ecommerce will continue to change, especially in terms of B2B innovations. Plus, we have a really meaningful conversation about how women are being brought into the fold at Stanley Black & Decker and elsewhere, and she explains why it’s so important for a company to practice what it preaches when it comes to its values. Enjoy this episode!

Main Takeaways:

Higher Stakes: Larger companies have a lot to lose if they make a misstep, and as such, they have to be a bit more cautious with the risks they take. But they still have to break out of their shells and explore all of the options, trends, and channels that are dominating the ecommerce space. To toe that line, looking at the data and the ROI of any experiment is the best way forward.
Knocking on the Door: Since early 2020, the ecommerce industry has seen massive growth and acceleration, but the jury is still out on how much of the shift online will stick. Most experts believe that at the very least, digital platforms will be the “front door” for customers to discover and learn about brands and products.
Trickle Down: Everything has to start at the top — from company values to operations to business goals and expectations, the leaders of the organization have to set the tone. If they do, and they practice what they preach when it comes to things like gender parity, diversity and inclusion, KPIs, work expectations, etc., talented people will be more inclined to join your organization, and they are more likely to stay for a long time as well.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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2021 Trends: Ecommerce is Evolving — Are you Prepared?

info@mission.org (Mission) — Tue, 11 May 2021 07:00:00 +0000

In the wild world of ecommerce, the status quo is always changing. New companies enter the market to disrupt the norms. Legacy brands pivot to get a piece of the pie. Successful niche businesses get acquired left and right. With so much happening all at once, it takes a lot of work for brands to not only keep up but to get out ahead and win.

Andrea Leigh and Melissa Burdick have made it their mission to stay on top of everything that’s happening and use their knowledge to help companies large and small make an impact in the market. Andrea, who you may remember from a previous episode where she discussed how to win on Amazon and the death of the category, is the VP of Strategy and Insights for Ideoclick, and Melissa is the Co-founder and CEO of Pacvue, a company that helps advertisers scale on big ecommerce platforms like Amazon, Walmart, and Instacart. A few customers of theirs include Unilever, Duracell, and Johnson & Johnson.

These ladies each spent 10 years at Amazon “back when ecommerce wasn’t cool,” as Melissa says. Today, at their current companies, they work with disruptors and major brands alike as they come to realize that ecommerce is not just a fad, but the way of the future. And that’s why I was so thrilled to invite them on this roundtable episode to talk about all the trends they’ve been seeing recently, and to get their take on where things are headed. How are major brands moving to digital? Why are companies investing more in shorter product life cycles? What is the future of dropshipping and ad platforms? I wanted to know, and they delivered the goods. So sit back and enjoy!

Main Takeaways:

David vs. Goliath: In the world of ecommerce, it often boils down to small, niche brands competing against the bigger companies with a long history and much bigger budgets. In order to compete, small brands are forced to think differently, be more hyper-focused on product and customer feedback, and be intensely in tune with the ROI of any ad spend.
Shorten That Lifecycle: Brands today are finding out the importance of being nimble and developing shorter product life cycles. When the unexpected happens, markets shift, or industry standards change, having a product already in process of a nine-month cycle puts you at a disadvantage to other brands that can pivot and change course quicker. Having a pulse on what consumers want, gathering data, and digging into feedback can help with the acceleration process.
Show Me The Money!: In the past, measuring the ROI of advertising was a bit more challenging. Now, with the amount of data that you get from digital campaigns, measuring the return on investment of an ad campaign is much easier to track because you can correlate clicks and track customer journeys from ads. And with the number of new platforms that are constantly popping up, there is a bit of a new retail explosion that brands can take advantage of and track in unique ways. And today, regardless of the platform — new or old — brands will not advertise at all unless they can get a full view of the data and metrics from the ad platforms they work with.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Marketplace Madness: A Look at the Past, Present, and Future of Marketplaces

info@mission.org (Mission) — Thu, 6 May 2021 10:23:00 +0000

Mini malls, shopping centers, and large department stores all still exist and remain popular despite their digital counterparts

But online marketplaces are where more and more brands are gathering to not just sell goods, but to get a better 360 view of their customers, and gain access to sell products from other big name brands that fit their marketplace niche. On this episode of Up Next in Commerce, I explored that idea a bit more with Jason Wyatt, the Executive Chairman at Marketplacer, a business dedicated to creating marketplaces. We dove into the various ways that Jason has seen marketplaces evolve, especially in recent years. Plus, Jason talked about some of the incredible innovation that he’s seen take place thanks to marketplaces — including the birth of Providoor, an Australian marketplace for restaurants that was built as a reaction to COVID-19 and reached a $100 million run rate within 12 weeks. We talked about how the marketplace connections made that possible, and also how the B2B landscape can be revolutionized thanks to marketplaces. Enjoy this episode!

Main Takeaways:

Getting The Bigger Picture: By creating a marketplace, businesses can get a much deeper picture into the attributes of their customers, while also gaining access to inventory and products to sell from big name brands. The key to success? Curation.
We Have A Connection: One of the greatest advantages of a marketplace are the connections that can be formed within them. Especially from a B2B perspective, because for so long those buyers have been left out of the ecommerce equation. They desire the same level of connection and ease that those in B2C have come to expect though, and marketplaces have provided a way to create community and engagement that has made B2B selling and buying much easier.
Long Live Loyalty: Big brands have long tapped into loyalty programs as a way to earn customer trust and keep them coming back. By expanding point systems to usage within a marketplace, brands are now becoming even more trustworthy and respected in the eyes of consumers, who can all of a sudden get more bang for their buck. Additionally, the rise of wide-ranging marketplace loyalty strategies will likely become a new way for retailers to attract customers to newer marketplaces.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Biting Off A Piece of The Pie: How Bite Toothpaste Bits Disrupted a Century-Old Industry

info@mission.org (Mission) — Tue, 4 May 2021 07:00:00 +0000

Lindsay McCormick knows a thing or two about pivoting. After all, she went from planning to live in a van and travel around the country selling her sustainable toothpaste bits to launching a transformative and still-growing company that has taken the internet by storm and has left the big brands shaking in their boots.

Bite Toothpaste Bits was the company Lindsay never meant to start, but a viral video helped launch her full-time into the world of ecommerce after she went from 6,000-lifetime sales to 200,000 in a single week. Needless to say she could no longer manufacture everything from her living room, and instead was thrown into the deep end trying to find production and shipping partners that could not only make her very specific products, but do so in a sustainable way that stayed true to Bite’s ultimate mission. There were challenges around every corner, but Lindsay navigated through them all, and on today’s episode, she shares that rollercoaster ride of a story . Plus, she explained why she thinks it’s so important to keep content creation in-house, the reason she’s always testing new channels and leaning into video content — I mean, it is what launched her company — and she reveals why she’s not scared at all about the big-name manufacturers making copy-cat products, in fact, she’s excited about it. Hear all that and more on this episode!

Main Takeaways:

Don’t Fight The Fog: Breaking into new channels means divorcing yourself from KPIs and metrics and walking into foggy and unknown territory. Embrace that journey because not only will you eventually be able to measure success, the opportunity cost of not taking the risk is too costly not to try.
Pay It Forward: Going viral comes with its pros and cons. While the huge boost in sales is a dream come true, fulfilling orders becomes a major problem that has to be solved quickly or you risk losing all of your new customers. As a sustainable business and a small business at that, Bite fought many battles to find manufacturers and fulfillment centers to partner with that met all their needs and price points. As Bite has gotten bigger and found the right partners, the company has also outfitted those partners with some of the tools that they can use to help support and grow other small businesses.
Teach Me Your Ways: Educating consumers is one of the most important things an ecommerce site needs to do, especially when the product offered is something that requires a change in habit and/or expectations. Customers who take the time to learn will be more likely to repeat orders, and they will also be more likely to be understanding of things like extended shipping times.
Make Em Sweat: It can be intimidating to go up against giants in an industry, but showing even a little bit of success in grabbing market share is something that will leave those big guys feeling pressure to make a change. Not only should that be encouraging to you as a disruptor, but in the world of sustainability, when the big guys start making changes, the small impact of a disruptor grows exponentially.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Secrets to Selling Luxury Goods

info@mission.org (Mission) — Thu, 29 Apr 2021 07:00:00 +0000

One of the hardest things to do in ecommerce is creating an online experience that truly showcases every aspect of a product. This is especially true in the world of luxury goods, where allowing customers to touch, feel and admire the craftsmanship of a product. And at the same time they are expecting an indulgent in-store experience which is tantamount to the story of the brand. Just the in-store experience can serve as the main selling point and create word of mouth like no other.

Throughout his career at places like Brunello Cucinelli and Boggi Milano, Fedele Sforza has had to meet that challenge head-on and figure out a way to create a luxury ecommerce experience that matches and works in tandem with the luxury in-store experience. On this episode of Up Next in Commerce, Fedele tells us exactly how he’s been able to do just that, and he explains why ecommerce leaders have to be evangelists within a traditionally retail-based environment. Plus, he details how to use data and technology as a window into the needs of your different customers, which you can then leverage to create personalized shopping experiences across channels. Enjoy this episode!

Main Takeaways:

Showcasing Luxury: The in-store experience is a much easier place to showcase luxury items and create a one-of-a-kind, high-end shopping experience. Online, there are fewer ways to showcase craftsmanship or cater to a consumer. But it’s not impossible, and it should be a priority to create a personalized and extravagant experience online that can match or work in tandem with what happens in-store.
Friends, Not Enemies: When a company begins to prioritize and invest in ecommerce, often the retail side of the business sees that as a threat. An ecommerce leader’s job is to be an evangelist and show the ways that both retail and ecommerce can work together, share data, and create experiences that cater to customers in a more personalized way. If that collaboration happens, not only will customers have a better experience, but the business will see a boost on the bottom line because sales are being optimized across all channels.
Curating Connections: Rather than making a list of channels in which you have to market, start to think about finding ways to form connections and create experiences with customers in the places where they want them. Not everyone is in the headspace to buy something when they are scrolling through Instagram, but they might be interested in purchasing something when they are at an event with friends. You have to find ways to connect with people in all places and in unique ways so that you are top of mind whenever they are actually ready to purchase.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Insights Learned From Digitally Transforming a $9B Company

info@mission.org (Mission) — Tue, 27 Apr 2021 07:00:00 +0000

No digital transformation is the same, but when a massive B2B organization embarks on that journey, you better believe that there will be a lot of lessons learned that can be applied to any other company. That’s why we wanted to talk to former Chief Digital Officer at Univar Solutions, Ian Gresham, who led the digital transformation and ecommerce implementation at this $9 billion multinational industrial distribution business. Look around at the things around you, make up, dish soap, skincare, solvents for your car. Univar probably has a part to play in that.

On this episode of Up Next in Commerce, Ian tells us about the experience of bringing a massive organization into the world of digital commerce, and he reveals some of the biggest learnings from the experience that he is using now as an executive advisor to multiple businesses. For example, how should ecommerce leaders frame the building of a platform to get buy-in from the top down, and what kind of strategies should you implement to drive adoption of your platform? Interestingly, it’s a combination of moving fast but also taking it slow — tune in to learn what that means in practice. Plus, Ian shares more tips and discusses some of the insider details on the projects he’s currently working on. Enjoy!

Main Takeaways:

If You Build It, They.. May Not Come: When going through a digital transformation, many companies fall into the trap of believing that if they simply build and launch an ecommerce website, their customers will flock to it. In reality — and especially in the B2B space – there is an education and adoption phase that needs to happen to actually make an ecommerce site successful.
M-V-P!: It’s wise to take an MVP approach to building an ecommerce platform because it forces you to focus on one specific feature that you can provide that solves a problem for a customer reliably well over and over. By offering that one solution, you can drive faster adoption of the platform because you are not overwhelming customers with a multitude of features, some of which they don’t want or need. New features can come down the road, but adoption needs to come first. And the entire organization needs to be on the same page that building a platform is an ongoing process with no set start and end date because there will always be new things to add or improve.
It’s About The Journey: In businesses that rely on face-to-face interactions, the omnichannel experience is becoming more important than ever. To digitize some of the interactions and drive the adoption of more online tools, you have to start from the bottom up and understand every kind of customer and customer journey that exists within your business. From there, you can start reallocating headcount to digitize certain processes and send other resources to handle high-value customer interactions so that you know you are investing in the parts of the customer journey that are most in need.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Customer Acquisition Through Content Creation

info@mission.org (Mission) — Thu, 22 Apr 2021 07:00:00 +0000

Let’s be real, talking about sex makes people uncomfortable. But it shouldn’t! And that’s one of the driving principles behind Maude, a modern sexual wellness brand that is disrupting a taboo industry and making sexual health more a part of the overall health and wellness conversation.

On this episode of Up Next in Commerce, I chatted with the founder of Maude, Éva Goicochea about how she built her company with a combination of excellent content, a growing and vibrant community, and a go-to-market strategy with patience and empathy top-of-mind. Éva also gave us some insight into the lessons she’s learned from bringing Maude into the retail market, and how she goes about assessing customer acquisition and community engagement. Enjoy this episode!

Main Takeaways:

Getting To Market: Ideate quickly, go to market strategically. Get to know who your customers are, what they want, and what problems they need solved before pushing a product to market. Not only do you need to take into account what your customers want, you also need to consider the associated logistics and cost that product will have to your business. You have to decide if your company is the one that should be creating it and whether the market size is big enough to jump through whatever hoops there are to actually bring that product to life.
Content is King: Obviously, businesses want to sell goods on their websites. But it may actually be a better strategy to build a site that is less transactional and more content-driven and educational. In doing so, you can attract a casual audience, who are more likely to turn into buyers when they are already on your site.
Bidding Wars: When wholesaling or working with retailers, a unique problem arises if those retailers try to outbid your brand for keywords and search terms in order to win more customers. Whether or not to fight to win those bidding wars comes down to assessing the value of the customer acquisition method. Is the customer more valuable as a native buyer or do you get the same or more value by having your wholesale partner see success selling your product?

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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What’s Love Got To Do With It?

info@mission.org (Mission) — Tue, 20 Apr 2021 07:00:00 +0000

The Beatles told us that All You Need Is Love. Howard Tiersky says the same thing — but he’s talking about brands, not the whole of human existence.

Howard is the CEO of FROM, The Digital Transformation Agency, which has helped brands such as Mattel, Barnes & Noble Education, Mall of America, NBC, Avis-Budget, and more transform to compete and win in a new digital world — and they succeed by getting customers to love the brands and everything they offer. Whether you’re a shiny new ecommerce start-up or a legacy brand with decades of history behind you, getting a consumer to actually love you is a multi-step process that is getting harder and harder as the digital landscape evolves.

On this episode of Up Next in Commerce, we dig into what the pyramid of brand love looks like and how companies should be working to climb their way to the top. Plus, he reveals the biggest mistake he sees companies making that causes potential customers to shop elsewhere, and he gives some strategies to rectify that situation and improve your bottom line. Enjoy!

Main Takeaways:

The Switching Cost is Zero: On the internet, it’s easy for a customer to move from one brand to another and it costs them nothing to do so. That means a brand’s first duty is to explain very quickly and clearly that it can and will solve a consumer’s problem. This is the area where most brands fail because they don’t have clear, simple messaging or content that tells their story and delivers their value prop instantly.
Keep It Simple: Doing customer research is the best and easiest way to find the kinks in your website and processes. Setting up a simple focus group to watch how customers are using your site to see where their pain points are or where they are getting stuck can reveal the most basic and easy-to-solve problems that could increase your bottom line.
Pyramid of Love: Creating a brand that people truly love is a challenge that has to be tackled in stages. There are specific levels of customer affection that you need to build up and that eventually culminates in love. But reaching those levels takes work and requires a brand to take specific actions. What are the levels and how do you reach them? Tune in to find out.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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It’s A Trap! Why You Shouldn’t Sacrifice Authenticity on Amazon

info@mission.org (Mission) — Thu, 15 Apr 2021 07:00:00 +0000

Brands are facing fierce competition in this ever-evolving ecommerce landscape. More often than not, shoppers do a general product search on Google or Amazon, where hundreds, if not thousands, of brands fight for the sale. It’s a hard arena to win in, and every company is trying to find shortcuts and strategies to give them an edge.

You’ve probably seen some of those strategies — for example, the products with a bunch of random SEO words jammed into the title so that the item appears higher in search. There are plenty more wacky Amazon tricks of the trade that brands have tried. Goal Zero is one of those brands trying to figure out the secret sauce but approaching it in a much different manner. Patrick Keller, Head of Marketing and Ecommerce at Goal Zero, may have finally solved the mystery — but the answer is not what you might be expecting.

On this episode of Up Next in Commerce, Patrick tells us that there are a few key strategies to unlocking more conversions on Amazon, and how they view authenticity and increasing brand awareness.TLDR: it takes great messaging, some big bets, and a lot of long-term thinking. Oh, and some pretty cool products, too. Hear all the details on this episode!

Main Takeaways:

Always Be Iterating: Producing marketing material is not a cut-and-dry process. Define your target market, set KPIs, and establish a timeline, then create a system that lends itself to AB testing and iteration. Don’t be afraid to create assets and then break them into pieces to test in different ways. You’ll learn more about your customers and the market in general that way, which you can then expand on when you embark on larger campaigns.
Dream Big: Taking bigger advertising risks with a long tail is often a good way to get more bang for your buck. By investing in large-scale projects with a cinematic quality, you have more of a chance to use that content for much longer and build brand awareness with a larger audience that might miss a one-off campaign.
Consider This: Figuring out a way to bypass the consideration phase on Amazon is one of the big challenges facing brands today. Because of the amount of options Amazon shoppers are presented with, companies that might have converted easily on their own site are losing out on Amazon. Whether through influencers or targeted campaigns, building brand awareness and loyalty is one of the methods brands are using to start bypassing that consideration phase and actually convert more.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Bringing B2B Into The eComm World and Other Industry Trends

info@mission.org (Mission) — Tue, 13 Apr 2021 07:00:00 +0000

Ecommerce has come a long way from its early days as a separate part of the company that you set up and just hope to see returns on. Now, ecommerce is pivotal for just about every organization — but there is one faction of businesses that still lags behind.

There are $17 trillion dollars worth of B2B payments made every year. Yes, trillion with a T. And half of those payments are still being made manually. Clearly, there is a massive shift that still needs to happen in the B2B space, and Deloitte Digital is helping make those digital transformations a reality.

Paul do Forno is the Managing Director at Deloitte Digital, and on this episode of Up Next in Commerce, he helped us understand the struggles B2B brands are facing and how moving them into the digital space could spell a massive change in the ecommerce industry. Paul also dives into some of the major trends he’s keeping an eye on in the ecommerce world, including how ecommerce continues to scale around the globe, most notably in Latin America. Plus, he shares some tips for businesses who are overwhelmed by the amount of channels and platforms they suddenly have to play in. Spoiler: he says do less. Tune in to hear more!

Main Takeaways:

Massive Call And Response: Bigger brands are struggling to stay connected to their consumers in a way that scales. Today, customers are looking to have a more authentic relationship and connection with the brands they engage with and support. For enterprises, connecting one-to-one is nearly impossible, so they are investing in tools like A.I. and conversational platforms to keep up with this newer generation of customers who crave connection.
Dinosaurs Still Exist: So much B2B activity is still done manually, which means that there are trillions of dollars of transactions that could be moving online if/when B2B companies finally shift their activities to the digital space. The problem is that many B2B companies are miles behind their B2C peers in terms of optimizing the digital space for their many personas. It will take a lot of tools and transformation to bring those traditional B2B companies into 2021, but it will be necessary because the next generation is not interested in manually doing business and would much rather work with companies that have effective digital tools.
Do Less: Brands can get caught up in the hype and the attempts to keep up with the Joneses. Instead, they should focus on being great at one platform or marketing activity. Plus, it’s critical to never forget the basics — like making sure your email list is generating the leads and engagement it should be to power your business.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Winning the UGC Battle

info@mission.org (Mission) — Thu, 8 Apr 2021 07:00:00 +0000

Word of mouth is still the best marketing tool, even in today’s digital world. And in this time of the ecommerce boom, brands are constantly working to build buzz for their products. Whether that’s through ratings, reviews, social posts, or unique ad campaigns. But there’s one highly coveted strategy that’s been bubbling to the top of the stack, and every ecommerce leader knows it is the way of the future. User generated content.

And a company called Yotpo is here to help with that. Yotpo is one of the top platforms that companies such as IKEA, 1-800-FLOWERS, Chubbies and more lean on to help them build communities, generate UGC, and create loyalty programs that yield the kind of engagement most brands only dream of.

On this episode of Up Next in Commerce, I asked the co-founder and CEO of Yotpo, Tomer Tagrin to give us an inside look at how Yotpo is generating 5X more engagement and content creation than is typical. Plus, we also dove into the future of loyalty programs and personalization. My one-sentence takeaway: definitely start leaning heavily into loyalty and maybe let off the gas a bit on personalization. Why? Tune in to find out!

Main Takeaways:

Do What You Know: Success in ecommerce is becoming more about the community you can build to support you. So the question founders are asking themselves — and Yotpo — is how do you build that community? The answer is pretty simple actually, you just have to follow your own interests. A founder starts a company for a reason, and they typically personify the exact target customer their company is going after. So dig into that link and create content and strategies that would resonate with you, the founder.
Long Live Loyalty Programs: Every brand should have a loyalty program, otherwise there are opportunities and dollars being left on the table. The only way to access those opportunities and cash, though, is through a very brand-specific program. There are no one-size-fits-all loyalty programs. Brands need to understand what they want to incentivize for in their loyalty programs, who they want to target, and how they will reward the behavior they are trying to generate through the loyalty program.
Partial Personalization: By deploying personalization tools, you can sometimes open Pandora’s box of never-ending adjustments and adaptations in order to create individualized experiences. At a certain point, the return on that investment starts to diminish. Customers are all different, but they don’t all need to be treated as unicorns. Create segments of customer types, and personalize the experience to those subsets.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Fad or Future: An Inside Look at Shopping at the Edge, Implementations and Where Ecommerce is Headed

info@mission.org (Mission) — Tue, 6 Apr 2021 07:00:00 +0000

The world of ecommerce is constantly changing — this last year being a prime example. How people shop in 2021 is radically different from how they shopped in early 2020, so forget about thinking about comparing today’s world to a decade ago. Although that is fun to see how much has changed. Now, it’s all about keeping up with your customers, which is why for our first official roundtable episode of Up Next in Commerce we wanted to bring on two people who have been on the cutting edge of the industry for years.

Ashima Sehgal is a Software Development Manager at Amazon Music and Jon Feldman, a Senior Marketing Leader for Salesforce Commerce Cloud. These two go way back to their days working together on ecommerce implementation at Restoration Hardware, which was a journey in and of itself, and while they remain close friends, they sit on the opposite side of the fence when it comes to certain aspects of the future of ecommerce. We get into all of it in this episode, including discussing whether shopping at the edge is the future of the industry or just a passing fad, and how to get buy-in when selling a new implementation. I hope you enjoy the conversation as much as I did!

Main Takeaways:

Make It Easy: When pitching or selling an implementation, the key is to tell the right story and make it hard for the business to say no. Highlight the pain points that their business is facing, and play up how you will solve those problems from beginning to end and be a great partner throughout the process. But one thing to remember, don’t try to tackle everything from the start and be upfront about what is prioritized and what is put on the backburner.
Edgy Opinions: There is a lot of debate on the future of shopping at the edge and whether or not it is a fad. Regardless of whether it sticks, businesses should be harnessing the power of meeting customers where they are and selling to them in those places, but the base ecommerce platform should not have to suffer as a result of those efforts.
It’s All A Simulation: In the last year especially, there has been a lot of talk about the death of retail and the rise of an ecommerce-only economy. That is a myth. While 2020 and early 2021 undeniably changed the way people shopped, it was more of a blip in the timeline and not a true indicator of the future, which will more likely be a blend of in-person and online experiences.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Big, Bold Future of A.I. in Retail and Ecommerce

info@mission.org (Mission) — Thu, 1 Apr 2021 07:00:00 +0000

Interacting with customers requires a level of finesse and talent that is beautiful when done well, and a tough sight when done poorly. There is give and take, and you have to flow through various movements and ups and downs to reach a satisfying end result. It’s like a dance. A tango if you will. At least, that’s how the folks over at LivePerson see it.

Alex Spinelli is the CTO and EVP of product, technology, and operations at LivePerson, and on this episode of Up Next in Commerce, he broke down what that dance should look like, and how A.I. is taking the lead.

As Alex explains, LivePerson is a set of tools, technologies and platforms that enable businesses to have conversations with customers through messaging channels, and to detect where customers may be getting stuck or frustrated. Then, with a small immediate intervention, LivePerson’s A.I. routes that customer to a human who can make the buying process easier. It is a way to get to a better end result more often, and it works. Businesses using LivePerson have seen double-digit-percentage-point improvement in conversions and higher NPS scores than ever. But the power of A.I. doesn’t end there, and Alex dives deep into where we are headed with A.I. as a tool in retail, including the blended in-person and virtual experiences that seem to be overlapping more than ever before. And Alex gets into the nitty-gritty of the ethics behind A.I. and how everyone will have to be more involved going forward when it comes to defining their limits, wants, and needs. Enjoy this episode!

Main Takeaways:

Joining Forces: The future of A.I. in the ecommerce space is in the way brands can join together an A.I. experience with a human-based one. The way brands should be looking at A.I. is as a conversation-starter and a tool that can solve transactional problems, but when a deeper conversation is needed, it should be able to usher customers through a seamless transition to a real person who can build a relationship, form trust, solve problems, and ensure that the customer experience is a good one the has a positive end result.
Let’s Get Ethical!: With any new technology, there are ethical questions that have to be addressed. This is especially true when dealing with A.I. Not only do you have to take into account the repercussions that A.I. will have on the labor force, but you also have to consider how A.I. is being trained, what kind of biases are being programmed into the model, and how and when to start and stop collecting data to build bigger and better A.I. models.
Blend It Up: As we move further into the fourth industrial revolution, we are beginning to see more blending of virtual, digital, and physical experiences. Conversational technology will begin to follow us into physical stores and A.I., along with more targeting-types of technology, will be used in and out of stores.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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The Pivot From Retail to Ecommerce

info@mission.org (Mission) — Tue, 30 Mar 2021 07:00:00 +0000

By now we’ve all heard about the thousands of businesses that pivoted to ecommerce in the wake of the pandemic last year. What we haven’t heard as much are the lessons both companies and consumers have learned in the process.

On this episode of Up Next in Commerce, I was excited to dive into those lessons and more with Israel “Iz” Moreira, the co-CEO of Doughp, a company that sells edible (and delicious) cookie dough. Prior to 2020, Doughp relied heavily on its brick-and-mortar stores and the foot traffic they delivered. But Iz saw potential in expanding the company through ecommerce channels, and, luckily, laid the groundwork for the infrastructure for that pivot even before COVID-19 forced Doughp to shutter its retail doors. With a now fully-online company, Doughp has started to centralize and increase its shipping capabilities and has seen success, but it wasn’t a cake (or should I say, cookie dough) walk. Iz explains some of the hardships Doughp faced on its journey to ecommerce success, including how little information-sharing there still is in the business world when it comes to cold shipping. Plus he dives into the recent revelations he’s discovered about whether free shipping actually matters as much as you think it does. Enjoy this episode!

Main Takeaways:

Secrets Are No Fun: Multiple players in the ecommerce space have reported struggles in optimizing the logistics of cold shipping. Some have figured it out on their own, while others have known the answers all along and have been keeping them close to the vest. Competitive advantages are still alive and well in the business world, so the level of information sharing when it comes to cold storage is still quite low in order for places like grocery stores and meal preppers to maintain their edge.
Lead With Mission: Depending on your industry, you should be thinking about how to best reach customers in a differentiated way. Testing is required to find the right strategy, so don’t be afraid to experiment with personalization and messaging. And if you are in a more commoditized industry, finding that one thing that separates you from the rest of the pack is going to be the difference between a customer choosing you or not.
Does Free Shipping Matter?: While 2020 was a struggle for most, there were some bright sides, including the education of consumers on the world of shipping and logistics. As more consumers became educated on the hardships businesses face when it comes to shipping and handling, the customers have become more willing to pay for shipping.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Differentiating Your Amazon and Native Website Strategies

info@mission.org (Mission) — Thu, 25 Mar 2021 07:00:00 +0000

If done correctly, a two-headed strategy of driving sales on Amazon and your native website could yield huge dividends. But what does that kind of strategy look like, and how can you create a scenario where one builds off of another?

The answer lies in assortment and pathways into the brand experience. Ben Knox is a bit of an expert in this area and he’s here to share his expertise. Ben earned his stripes working on Red Bull’s ecommerce strategy, and now serves as the SVP of Digital at Super Coffee. According to Ben, brands need to come up with an assortment strategy that allows customers to get what they want, when and where they want it, but also leads them back to the type of brand experience you want them to have. He also details how beneficial a subscription model can be, if done right. Plus, he gives some tips on how to get the most out of your texting strategies and what is going on in the wild west of customer acquisition.

Main Takeaways:

Assorted Assets: When you sell on Amazon, as well as natively on your website, you need to decide on an assortment strategy and how each site can build off each other. Whether that is only placing a select assortment of products on Amazon, or having a full assortment across channels, but offering more subscriptions and sales on your website, it’s crucial to have pathways back to your branded channels.
Gotta Flex: If you offer subscriptions, you can only achieve true customer success if you offer flexibility. Even if it means that your customers can cancel a subscription ten minutes after they sign up, those are the kinds of options you need to offer. Doing so allows your customers to feel unburdened and that the experience is risk-free, which makes them more inclined to sign up.
Text Me: There are benefits to separating your text strategies in order to maintain the relationship you want with your customers. Having separate text numbers for subscription management and branded content will help customers differentiate the experiences they are having and allow you to cultivate a true VIP experience with those who opt into the branded company channel.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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How Disruption Happens in Retail and Its Ripple Effects on Ecommerce

info@mission.org (Mission) — Tue, 23 Mar 2021 07:00:00 +0000

Innovation is risky business, especially if you’re a hardware startup. But it’s not just risky on the part of those inventing a new product. The early adopters of that product are putting a lot on the line, too. Which is why certain industries, like retail, have remained mostly the same for decades. Retailers only want to bring in something new if the operational cost of installing and using the innovation are minimal, and if it doesn’t require a massive overhaul of a retail space. This is exactly what Lindon Gao found out when he started exploring this space.

Lindon has been on a mission to disrupt retail since his first application for a smart security tag was accepted by Y Combinator, and while that hardware didn’t take off, Lindon kept going until he landed on an idea that stuck. Today, Lindon is the CEO of Caper, a company bringing smart cart technology into the retail space with increasing success. In fact, Caper’s tech could be coming to a store near you, as the company recently agreed to partner with America’s largest grocery retailer, Kroger, to bring smart carts into chains all over the nation.

On this episode of Up Next in Commerce, Lindon talks us through how Caper is finally bringing change into the world of grocery, and he explains how smart cart technology could have ripple effects on ecommerce, personalization, and the entire customer journey. Enjoy this episode!

Main Takeaways:

Where’s The Easy Button?: Implementing new technology isn’t easy in retail. The operational headaches of launching anything new often outweighs the benefit of most of the new tech being presented. Incorporating new tech as a retailer requires finding innovations that don’t need large system overhauls, already naturally fit into the customer’s store journey and provide an added benefit (i.e. more customer data, more opportunities to upsell, etc), to make the investment worth it.
Do You Want a Receipt?: Smart receipts are one of the top ways to keep track of consumers after they make a purchase. Receipts offer a window into consumer behavior, and also provide a new area for personalization and follow-up conversations that keep customers engaged.
It’s Not Either Or: When it comes to ecommerce and grocery, it is not an either/or question. Both in-store and online shopping will continue, and, in fact, the move toward ecommerce will only push the in-store experience to be even more efficient and streamlined.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Creating Commerce At The Edge With Conversational Commerce Applications

info@mission.org (Mission) — Thu, 18 Mar 2021 07:00:00 +0000

When people scroll through Instagram these days, they can’t avoid the ads and the influencers pushing products. And that’s not a bad thing. In fact, more and more often, ecommerce is taking place in channels other than on a brand’s website, which is why so many companies are looking for ways to optimize how they execute commerce at the edge -- this means meeting customers where they are. Paloma has one way to do that, by turning messenger platforms into sales channels, which creates a more personalized shopping experience for customers, and a .5-to-10x higher conversion rate for brands.

On this episode of Up Next in Commerce, I was joined by Kelsey Hunter, the Co-Founder and CEO of Paloma, to give us the inside scoop on why brands should be investing in conversational commerce. In the last year, Paloma has helped partners convert $9 million in sales, and she explains how that happened by simply diverting ad traffic away from a website and into a chat instead. Plus, she discusses the future of conversational commerce and how the low barrier to entry into the ecommerce industry is forcing everyone to adjust quicker than ever before. Enjoy this episode!

Main Takeaways:

Website Woes: Moving forward, a brand’s website will become more of a secondary piece of collateral when it comes to driving conversions. It will still be critical to have a fast, highly-efficient website experience, but more of the interactions and conversion efforts will be focused on other channels where customers are spending more time.
Get To The Party: The worst thing a brand could be doing right now is not experimenting with and setting up processes in Facebook Messenger and other messaging apps. Customer service and the customer experience are two of the leading drivers of conversions, and ignoring a channel that allows you to provide a proactive and personalized experience is a huge wasted opportunity.
Far Out Future: The future of commerce is being written right now with shops that are opening with simple Instagram product posts and telling customers interested to go to a PayPal link. More new brands are foregoing the traditional channels and website launches, so the barrier to entry is much lower. As more competition enters the market in this way, traditional brands will have to keep up with their own easy, personalized commerce options.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome to Up Next in Commerce. This is your host, Stephanie Postals, co-founder and CEO at mission.org. Today we have Kelsey Hunter joining us. The founder and CEO of Paloma. Kelsey, welcome to the show.

Kelsey:

Thank you, Stephanie. It's so good to be here.

Stephanie:

We're excited to have you on. I was just thinking I'm like, "How do I know I'm actually talking to Kelsey and not a chatbot?" She's put up a virtual screen and it might not even be Kelsey back there. I'm not sure.

Kelsey:

I have a history of pretending to be a bot, so.

Stephanie:

I actually, I read that. I read that you spent a little bit six weeks pretending to be a chatbot to learn how they worked.

Kelsey:

True.

Stephanie:

That's fun jumping off point. Tell me a bit about being a chatbot. What's that life like?

Kelsey:

It is wild. Let's see, I was working at a startup in New York that we offered mobile commerce solution for brands and publishers. So I was really deep in the mobile commerce space when the messenger API opened up. And as we're getting side projects, of course then, decided that messenger would be a good place to try to test things out.

Kelsey:

And before even building anything, I pretended to be a bot just to see how it would work. That's what sparked all of this. It was like, "Oh wait, if you can talk to people directly, people will talk to you about themselves." I'm asking people questions, they're telling me way too much information. That was really the spark for me. Then I said, "Oh, why are we making assumptions online? We can just ask people and they will very happily tell you things to help figure out what they should buy and why."

Stephanie:

That's cool. So you were doing this at another company. And then you're like, this is the business in and of itself. And that's how you went to create Paloma?

Kelsey:

Yeah. It was a totally side project outside of the company that I was working with. But all of the pieces tied together for me. That company is called Button, and when I left Button, I did a little bit of other experimentation in the channel. Actually, worked with a team to build a open-source software, to help people call Congress on Facebook Messenger, which was one of the first software tools that was like a MailChimp for the space, which is really cool. But brought it all the way back around to commerce and launched Paloma at the end of 2017.

Stephanie:

Cool. So tell me a bit more about Paloma. What is it? What does it do?

Kelsey:

Paloma helps brands turn Facebook Messenger into a sales channel. Essentially, we work with a lot of D2C and ecom brands across every product, category, audience, price point, and we help them drive traffic into messenger instead of their website where their customers get a more personalized shopping experience, that's powered by our software. So what that might look like for a furniture brand would be, they're running Instagram and Facebook ads and they can set them to open up a Messenger conversation instead of opening up a website landing page.

Kelsey:

And once in Messenger, our conversation, we'll ask them questions like what room do you want to design? What are the colors in that room? Do you have cats, dogs? Any other kind of style preferences. And then we'll dynamically route the customer to the right products based off of what they've shared. By helping the customer make the purchase decision, we're effectively seeing anywhere from two to 10X increases in conversion rates. And that's a little bit of very cap on, on how that works.

Stephanie:

That's awesome. I feel like just thinking about, I follow all these influencers on Instagram and they're always selling stuff, which normally I'm like, I want a lot of this. But if you respond to them, they definitely can't keep up. If you're like, does that size, would it fit me? Is that Off-White? Is that Real-White? It seems like there's a lot of opportunity everywhere to have a chatbot set up that personalizes the experience and also helps it scale.

Kelsey:

Exactly. And what you just described is one of the reasons that we see so much opportunity in that space. And the reason why customers messaged in the first place is because when it comes to online shopping people don't shop on websites. That's just where they transact now. But they're making decisions by what you're talking about, watching influencers, DMing folks, talking to friends, watching YouTube videos, TikToks.

Kelsey:

So you're basically piecing together all these different parties to figure out, should I buy this? What's the right thing for me? Whereas if you walk into a storefront, for example, you can get all of that figured out in a matter of minutes. You can talk to an associate, they're going to ask questions. Everything that you just described can happen there. There's nowhere like that online. And that's where messaging channels open up that opportunity for the brand to be part of that purchase decision process. So instead of leaving it up to all the third parties, the brand can do it themselves and they can scale it through these kinds of automated conversations.

Stephanie:

Very cool. And how do you go about setting up the responsive? Is it very custom based on the product? Like, do you work with a brand early on to be like, here's probably what they're going to ask you or they're telling you. What does that look like behind the scenes?

Kelsey:

We definitely curated a lot to the brand, a lot to the product type and to their customer demographic. So for example, Facebook recently published a case study of the work that we do with Wallow, which is a brand that sells titers, strollers. Basically goods for families and their kids. So they're really great products, but it's actually not so much about having a lot of skews. They don't have a ton of skews. It's more about why should somebody buy this Wallow stroller and how is it going to fit into their family and lifestyle?

Kelsey:

So essentially what we do is we'll work with them, look at the products that they sell and try to understand their customer type. In their case, a lot of their customers will buy for themselves, but there's a pretty good chunk that are gifting. So for example, the first question we ask is, is this for you and your family, or is this for a gift? Who are you gifting for? And then as customers answer these questions, we can speak to how it will fit into their lifestyle. How old is your little one? Are they eating solids yet or not?

Kelsey:

We don't actually need the customer to ask questions because by us asking questions first, we can preemptively answer how the value prop works for them. How it fits into their life. So we can say, "Well, they're eating solids is getting very messy. This high chair is very easy to clean." And so you're effectively accomplishing both along the way. It's basically just a really good sales conversation.

Stephanie:

Yeah. I mean, that's really smart and I think it's a different mindset where a lot of times, when you think about chatbots, the consumer has to initiate the conversation. Has to think of the questions. And it makes me even think about when I'm hiring... I'm trying to think what I was hiring. But they're like, "Oh, do you have any more questions?" And I'm like, "Well, what do people normally ask you? Like, what's the normal questions because I don't know what to ask you."

Kelsey:

What should I ask. Yeah.

Stephanie:

If I'm buying a house or whatever it is, what are the top 10 questions you get? And so that's great being like, we'll do all the work for you. Here's some of the questions that we know will start a conversation. So it's actually less work and less cognitive load. Where you can get to the end point and still leave being like, I know what I'm talking about now with this product.

Kelsey:

Exactly. That's 100% right. And it's actually a really classic UX design issue. Which is actually my original background. Basically, when it comes to any digital interface or any interface at all, if you don't know where you can go, you're not really likely to do it. You're not going to walk up to a pitch black tunnel and be like, "Yeah, I feel confident walking into that."

Kelsey:

That's like an open free from bot conversation or like you get on a customer support call and it's like, "What can we help with?" And you're like, "Well, depending on what I answer, what's the likelihood you'll have any idea what I'm asking?" It's not great. So we find that structuring and providing a really clear interface for the customers to navigate also makes a huge difference.

Stephanie:

We talked about this a lot on the show that shopping is moving to the edge. Everyone is shopping on Social, they're shopping on Amazon, Walmart it's everywhere and not always on the website anymore. Do you think that websites are going to become like a secondary thing, where it's like, yeah, it's a nice to have. But people are actually on TikTok, Instagram, Facebook. Going directly to Amazon, they're not really going to always go right to your website.

Kelsey:

That's exactly right. It's going the way of retail. And that's not to say it's going to go away. It's just that it's not the primary anymore. We see a website as like the catalog and it's a transacting location. In a lot of cases that's useful, but it's not necessary anymore. And we see that with how new sellers are starting today. Especially with COVID, everything accelerates so rapidly. But one of the really interesting trends is, you've got new shops opening up just with Instagram pages and saying, "Hey, DM me for this product and I'll send you a PayPal link."

Kelsey:

I think those kinds of very low tech indicators of the fact that that's where the market is heading. And, I think you're 100% right. The website's really not necessary. And there are tons of great antique shops I follow in New York that are doing just well without it.

Stephanie:

Yeah. That's cool. So what other trends are you seeing among sellers right now? Maybe anything new popping up and you're like, pre-COVID we actually weren't really seeing this and now there's a big trend to just opening an Instagram page and selling through DMs. What other things like that are you seeing?

Kelsey:

I think that's huge. I think that I'm really interested in these future QVC type of models. But that's just because I grew up watching those. I don't know, did you ever watched the knife show?

Stephanie:

I did not watch that, but.

Kelsey:

The show was wild.

Stephanie:

Well, there's a [crosstalk].

Kelsey:

I think it was on a lot when I was in college. We'd always end up like late night. The knife show would end up on at very late hour and it was just like, "Hey, here's some knives and we're just going to cut all sorts of stuff with these knives." Like the silliest thing. It was so funny, but-

Stephanie:

[crosstalk] the Blender show. It wasn't called the Blender show, but where they [crosstalk] random things in the blender and I'm like, [crosstalk].

Kelsey:

Exactly. The same kind of stuff.

Stephanie:

How much time do we have on our hands apparently?

Kelsey:

It was so silly. It was like cutting shoes and weird things like that. The humor of it, I think it was really fun. And I think that online, we're seeing a lot of that, like humor come into commerce in a way that I think it's really fun. And that's really what it should be. So I like things like that. But I do think that the new selling methods are probably what some of the most interesting things to me is just, what's the version of opening a store today versus before. And like the barrier to entry is just so low now. It's pretty phenomenal. So I'm excited for that.

Stephanie:

Yeah. Cool. And how do you advise brands to being proactive when it comes to starting conversations versus being reactive and just taking the inbound? Because if I'm thinking like, I'm a new brand, I don't have any inbound. What's the way to be proactive and like reach out to people with your product?

Kelsey:

What's really nice is that these channels are often first, which I think is really important for there to be a great customer experience. If we want these channels to succeed, if we want these brands to succeed, we need to make sure that we're being really mindful of the consumer. But what's really, really nice about Facebook Messenger while it is tough to work on another platform, play by someone else's rules sometimes, but there's a ton of great benefits there.

Kelsey:

And one of them is the acquisition funnel. So brands are currently running ads from Facebook and Instagram and stories, all those normal places. And all they have to do is set up the exact same ads, but they can change the destination of the ad click to open a messenger conversation instead of a website. And so we're able to say, "Hey, we're basically giving you a new ad type that you can leverage. It's going to drive to a higher converting destination." And there's no reason not to try that.

Kelsey:

Basically, it's a win-win from the standpoint of, it's really easy to test. We can guarantee traffic and make sure that we're properly vetting it and controlling the volume. And you can compare it one-to-one to your ads that go your website. So it makes it really easy for brands to get started. And it makes it easy for the consumers because they're doing what they don't normally do, which is click on ads. So that's the most common way to start.

Kelsey:

There are other ways of getting customers into the channel and you can do it with short links, with QR codes, we'll link from an email, a pop-up on your website. There's a lot of different methods there. And we have partners that do all of what I just described, but ads is a really common format because again, it's just a very seamless acquisition funnel.

Stephanie:

Cool. And is there anything that brands are doing right now in messenger or Instagram DMs, where you're like, that's actually the wrong way to do it? Anything that you would advise brands not to do or have seen things going wrong?

Kelsey:

Yeah, that's a great question. I think not doing anything at all is what I would say is the worst thing. Because, whether that's Instagram DMs and you're just not responding to the people that message you there, and that's a huge, lost opportunity. We understand that it's really hard to scale responding to people individually, which is why platforms like ours can help. But I'm just not doing anything, you're losing customers every time you don't respond to them because they want to engage with you directly for a reason.

Kelsey:

And every time they do that, there's an opportunity for that to become either a customer or a recurring customer. So let's say that's probably the worst, but in terms of actually doing things that are, are wrong, I don't like any of the spammy stuff and I don't like any of the things where it's not clear to the customer what's going to happen. Those are the things that I find frustrating, but in terms of how to do that, well, there's not as much going on with that anymore because Facebook really did crack down on some of it. So I'll say what I didn't like before was, there was a trend where there's an opt-in check box that you could put on your website that basically said, "I'm opting into Facebook Messenger with a business."

Kelsey:

And that's still something that you can use today, but at the time you could actually put it on your website pre-checked. Oftentimes customers wouldn't necessarily notice it or see that it was there or see that they had opted into something. But what was even worse was there were lots of sites that were putting them behind the scenes. So it wasn't actually visible on the page at all. So a customer would add something to their cart. And by submitting that add to cart, it was opting them into messages without them knowing it.

Kelsey:

And then they would get messages later if they abandoned their purchase that were like, "Hey, here's the 10% off. Here's a whatever go buy that thing you were looking at." Which inherently is not a bad workflow, but to do that without letting the customer know that's what's going to happen, really not great. I'd say that's the worst thing I've seen in this space, but you can't do that anymore. And I'm grateful for it.

Stephanie:

Yeah. Well, that's good. How do you keep up with the changes that Facebook's going through? Because it seems like they've been definitely on like a roller coaster where very popular. And then, I feel like they kind of went through a trough where it's like, does anyone use it anymore? And now I feel like it's growing again. Even among my friends, it's like people are using the groups now and Messenger.

Kelsey:

The groups are huge.

Stephanie:

That's the only reason I go on there for the most part, but how do you keep up with what they're even doing behind the scenes and how the buying groups on there just changing. And then coming back and then leaving, and then there on TikTok. How do you keep up with that?

Kelsey:

I think it could be really easy to get distracted or feel like that's very volatile. The approach that we've taken is actually just been to have our own point of view that is rooted in something just so fundamental that it doesn't matter what the policy changes are really. We won't be disturbed by them essentially. So we've looked at Facebook Messenger as a sales channel since day one of the business. And we've been around just over three years now. And of the platforms that were popping up at the time were MailChimps for Messenger, were abandoned cart notifications and things like that.

Kelsey:

And that is really easy to get disrupted by policy changes. But if you're fundamentally saying, this is a place where you can more effectively get a conversion from a customer and have a better experience for them. There's actually not a lot that that Facebook could do that would really interfere with that in a way. Unless they just fully said, "Hey, you can't actually use the API at all anymore." They just shut the API down. Then it'd be like, okay, fine. But even if that were to happen, the US market for messaging is inherently multi-channel.

Kelsey:

Messenger's not being first or last for us. It's going to be one of many. So, that's the way that we approach it as yes, we keep up with the trends. We are a platform partner, so we're pretty in tune with the roadmap and what's going to be happening there. And that's really important. The relationship is really important to make sure that you can prepare for your business. But at the end of the day, I think having a really just underlying fundamental platform approach to what we're doing, enables us to avoid a lot of the mishaps that we've seen affect other business models.

Stephanie:

Yeah. Cool. And you just mentioned like messaging is just the first, are there other areas that you feel like there's a lot of opportunity that brands can be selling in right now. Or maybe it's not even ready yet, but in the future it's coming down the pike.

Kelsey:

Yeah. I think anywhere where consumers and brands can have a direct conversation, you're going to see things evolve for that. And it might depend on the platform, if the platform is incentivized towards it or interested in it. Facebook supports this because they believe in messaging as the future of consumer behavior. It's something that's been around since the beginning of the internet, we've been chatting. I don't think that's going anywhere, but Facebook is also really highly motivated to monetize on it. And so, there's opportunity there.

Kelsey:

But would someone like discord do something like this? I'm not sure. I'm not sure if they're like motivated towards that or if that's part of the business that they want to be building. But I really do see that any messaging channel where you can have that kind of interaction, there's no reason not to produce a better shopping experience there and tried to scale that. It's kind of infinite, I think.

Stephanie:

I wonder if chatbots on websites, like native chatbots have muddied up a bit. Where it's like, we've all had that bad experience with a chatbot where they're talking and you're like, "Get away, get away. You're not going to be able to help me. I already know it Verizon, stop." [crosstalk]. I wonder if that has hindered the market, with certain people being open to buying via chat bot when they've had experiences that are subpar on maybe certain websites.

Kelsey:

At the start of these platforms opening up and these APIs opening up, you had people making bots left and right. And they were very low quality. It tarnished it a little bit. I think tarnished it a bit for the consumer and for the brands, because, when things opened up, brands started testing things and they weren't getting performance results. It wasn't their fault. It's really hard. It's like launching your first website and then not working super well. It's like, well, yeah, this is a totally new... It's where the start of websites existing. It's like, yeah, that's tough. It's tough to figure it out. It's a whole new learning curve.

Kelsey:

So I think that in terms of, what can happen there. It is very easy to tarnish their reputation, but again, it's not going anywhere. So as long as again, you have an opportunity to drive a better experience. You should keep iterating on that. And again, it's like if you have customers that are willing to do directly, it's always an opportunity to do better and to turn them into a better customer for you as well. There is also really huge difference between like the customer support experiences like that, and these types of sales experiences. I think there's a pretty clear line between the two and a lot of that depends on the customer's intent.

Kelsey:

If you're coming from an ad to shop driver, for example, you know that's what you're doing and you know that that's what you're being helped to do. And it's pretty straightforward. But if you're going in with any level of support need, there's a lot of opportunity to get that wrong. So it's really tough.

Stephanie:

Someone's already coming in with a heated mindset and one wrong word from chatbot. Ooh, I'm hot.

Kelsey:

Exactly.

Stephanie:

The one thing I think about too is the payment piece and how to make sure that customer journey is frictionless because even when I hear, Oh, some brands have a PayPal link, which I think is great. Or like an MVP, get something out there. And also, show there like, do I even know my PayPal login? Like, Oh, I don't know.

Kelsey:

Exactly.

Stephanie:

How do you think about, making the checkout experience frictionless where it's not a million different options and people know it's very be fast and easy.

Kelsey:

Currently we actually drive to check out on the brand site and we find that works really well because it's the trusted destination. You have all of the tooling and UI that you need to be able to have a good seamless checkout experience. And that works really well. Checkout is on our roadmap to be able to process that and manage that. And we won't be like a payment processor. We have partners we're talking to on end, but in terms of the checkout, there's a lot of ways to handle that.

Kelsey:

And I think that there's been so much best practice learned from mobile shopping as it is, that can be leveraged there. And there's also a ton of testing opportunities, but we really do look to... We're not trying to reinvent wheels here.

Stephanie:

That whole space is evolving so quick and just talking to the team at fast and continuing to be here and see what they're doing with the one-click checkout. I'm like, it seems like there's such an opportunity to have that right. In every form of like, you've got your cart already loaded in like your Instagram DM, and you can just hit checkout and all your payment information save and drop onto the next Instagram site.

Kelsey:

[crosstalk].

Stephanie:

There also seems like there's a good opportunity for Amazon there. I always look at all those Q&A sections, where it seems like how much time do I spend looking at toothpaste? Is it fluoride-free? It's for my kids, is it fluoride free? Does it not have this, that, that. All these questions, but I'm actually going through the whole product page for a thing of toothpaste so much time wasted. But it would be really nice to have a Messenger on there where you could just say, "Hey, does this have this and this?" Instead of me trying to zoom in on the ingredient list, or like, look at all the reviews for something that's like $6 or whatever it may be.

Kelsey:

Yeah, exactly. I hope Amazon's listening. They should come talk to us. We haven't seen anything quite like that, but we have talked to brands that sell on Amazon and we have done experiences in Messenger that link to Amazon product. That is something that we've experimented with before. And I think that you have to your point, why scroll through a million questions and answers that aren't necessarily relevant to you? And one might be, when you could just have the brand get to know you better and then tell you what you need to know.

Stephanie:

Yeah, exactly. So when you're first starting to work with brands who are implementing chatbots, what kind of metrics do you maybe advise them to look at to see if it's going well or not? Because a lot of people I could see being new to this, not even knowing like, well, what should I expect for conversion? Or like, what's good. What's bad. Like, how do you advise them around that?

Kelsey:

That's a great question. So first and foremost, and I think this is a little bit of what might have gotten wrong in the early days of the channel. Businesses care about performance. They care about conversions and CACs and return, and all those things. So, we want to make sure we're mapping to that because if you don't then at the end of the day, they're going to be worth your time if it's not performing on those metrics? Probably not. So first and foremost, we can own conversion rate. That's the KPI that we really truly measure against. Because essentially we're saying if you drive traffic here, instead of your website, it's more likely to convert. That's our thesis. And so if that's true, that's what we're going to start measuring against. And we'll do that by looking at what's your conversion rate from a standard click to site ad.

Kelsey:

So purchases you're getting out of link clicks. And then when you run a click to Messenger ad, we'll do the exact same thing. How many purchases are you getting out of those ad clicks? And that should be able to tell us if it's a higher converting channel for you. Fundamentally we've seen anywhere from 50% increases to 10X increases in one case and anywhere in between. So it's not abnormal for that to be the initial result. But then in terms of the other things like captain role, as they should benefit from that better conversion rate. It shouldn't be approached necessarily differently than any other conversion tests that you're running.

Kelsey:

That being said, we have a ton of insight into the full funnel that we can leverage to optimize. And so, all of our partners start with at least a three month program because we know it takes time to warm up and we want to make sure we can iterate. And we do that on a weekly basis. So you might start with X result in month one, by the end of month three, it should be much better. And so the way that we can do that is looking at everything from a customer clicks on an ad, they land into Messenger. Do they respond to the first message, which basically ops them into the channel?

Kelsey:

Are they completing like a quiz? If there's a quiz or personal shopper? Are they clicking on products back to the website? And then are they adding to cart? And then are they purchasing? So we have a slightly different funnel. You're going to get your ad performance from ads manager and see the link clicks and add to carts and purchases. Paloma is going to see everything in between. So we'll be able to know exactly where people are off and why. And be able to iterate on that much more efficiently than if it were traffic going to a website, where are they clicking? How are they browsing? There's like a ton of more opaque data from a website side. From our end we can literally just see, okay, you have too much drop-off on the first question. So let's not ask that question. Or, Hey, everybody is answering the same way to this one question, that doesn't need to be there.

Kelsey:

Or, people are clicking on the products. Maybe we need different product batches or whatever that may be. So we'll be able to get a lot more of a finer detail on that. And we have benchmarks for each. We expect our partners to get at least a 30% opt-in rate, maybe percent completion on any type of quiz or personal shopper experience. And then at least 50% of traffic clicking back to the website. And then from there add to carts and purchases depends on what they would normally expect to see. It's kind of a lengthy answer.

Stephanie:

It's good to know metrics like that to aim for. How do you plug into a brand's inventory system and then also make matches. That will be something that I want to look at. I can just imagine me going in there and not knowing what I ever want being like, "I want a picture." And then someone's showing me something and maybe like, "Oh, not that one." How do you guys personalize it and show something I want, but also make sure that you're not tapping into inventory, that's like out of stock.

Kelsey:

So we basically can ingest inventory into our system, keep that up to sync, keep that availability up to sync. And so anytime that we're building experiences, you're able to make sure that it's the right things getting shown. In terms of what to show customers based on their selections. We have this like start matching dynamic product matching system where basically the customer's responses get associated with the inventory.

Kelsey:

So all of your boots are associated with like a boot selection or all of your things that come and break colors would get associated with like bright colors. If you were asking about color preference. And some of these qualities are not things that would normally be tagged onto your inventory. So we're basically expanding on that. So we make the association between the two and as customers make the selections, we basically just filter down and display all the things that would then relate.

Kelsey:

So like Andy swimwear, for example, if you chose one pieces and some coverage and a lot of support, you're only going to see the products that, apply to all of those qualities. And it's really simple for us to create those. Something like that can take like 10 minutes to build, whereas a quiz to put on a website can cost thousands of dollars and take two months. And so, that's kind of part of the magic and secret sauce of our software.

Stephanie:

Yeah, that's cool. I was just thinking about, okay, to even create that kind of filtering and navigation options and all that can take a long time. And tagging it and making sure that it's actually can be searchable. And then if you can just have it in a DM or Messenger, that's great game changing.

Kelsey:

Yeah. It's really fun. It's a very simple, we have like own drag and drop interface to just jag product on to the selection options. They're tagged with that in the future. And then as customers answer, we just know what to show them.

Stephanie:

Cool. Where do you see the future of commerce headed or chatbots and commerce intersecting. What does that look like to you maybe three to five years down the road? Where do you hope it looks?

Kelsey:

Really, again, I like to look to what people are doing now when they're just starting out and also at other markets. So really in terms of the future of commerce, we believe very strongly that it's on messaging channels, that that is the next door front. And so, what does that look like? It's customers going to DMs, it's brands driving traffic to DMs and customers just getting much better shopping experiences there, converting there, checking out there. And new stores not having to even open up a website. Again, I don't think website's going to necessarily totally go away, but it's just going to be a smaller part of the puzzle. If you look at what's gone on in other markets like China with Weechat, they're way ahead of the game. And that works really, really well.

Kelsey:

And it's a huge chunk of the commerce ecosystem out there. So we've been a little bit slower to that, but it is happening. It's happening a little bit more multichannel, and I think that's really interesting and that's a really fun challenge is that, we don't have the monolith app that will do it all. We have a lot of [crosstalk] apps. I think it's great because everyone likes to have their own different way. We're always getting new social networks and apps out there and it's fun. It's really fun. So basically, I'm not sure how many different tools there will be in the future, but we very strongly believe that messaging is the next channel and destination for commerce to happen. And we're effectively building the platform to power that.

Stephanie:

That's great. It definitely begs the question about keeping things organized when you're selling on so many different channels. And there's probably going to be dozens of messaging platforms that people are using. I'm just imagining a brand, trying to keep up where, they go from selling on their website and then maybe dabbling in Amazon, maybe on Walmart. And then all of a sudden it's now, you can sell on Pinterest and Instagram and Facebook and TikTok. How do you think a brand would be able to keep up or do you see anything right now? Like any innovations that are allowing brands to organize everything in one central place that they can keep track of what they're doing?

Kelsey:

There are definitely a lot of interesting tools. I think that what comes before the tools are just the people, expertise. I think that's what we're seeing, services and agencies that will help with coordinating all of those things or know how to best launch on Amazon. And then once you've launched on Amazon and all these other places, then you go, okay, well now I have everything in too many places I need a more scalable system. And that's when you start seeing softwares get put in place. And I don't think any come to mind immediately, but I think there's some really great tools that are coming up to try to glue things together and basically to piece together, all the different supply chain and logistics issues.

Kelsey:

And there's some really great things out there for that. But we're also seeing new commerce platforms that are inherently taking those things in mind. So we have a lot of commerce players that exist that are trying to catch up and trying to add on these different channels. But then you have new players that are from day one saying, "We know it's not just about one place." So you've got things like, headless commerce and no code tools and platforms like Paloma that will from day one say, "Hey, this isn't just about a single source of shopping. It's about a lot of things."

Stephanie:

Yeah. I completely agree. All right, well, let's shift over to the lightning round. Lightning round is brought to you by Salesforce commerce cloud. I'll ask a question and you have a minute or less to answer. Are you ready? You look a little nervous. Wow.

Kelsey:

I don't know, that's scary. It's a little daunting.

Stephanie:

No, it'll be fun. It'll be fun. What one thing will have the biggest impact on e-commerce in the next year. I have a feeling you're say message shopping and Messsenger.

Kelsey:

Obviously messaging. I'll just be repeating myself a little bit, but I think messaging is a bit. It's already been exploding pretty quickly and it's growing faster than ever. We drove almost 9 million in partner revenue last year. And that's just as a small, early stage team, so there's a lot ahead of us.

Stephanie:

Yeah. That's cool. What, one thing do you not understand today that you wish you did?

Kelsey:

Just so many people things. I find people so fascinating. I'm constantly seeing how people chat, but I would just love to talk to people about their experiences with all of these experiences and with all these different kind of shopping channels. And, I think that it's not something that I don't understand. It's just something that I'm always eager to understand people's behaviors more. So that'd probably be it. [inaudible].

Stephanie:

What's up next on your Netflix queue?

Kelsey:

I am so behind, I need to watch Bridgeton and literally everything else. I've been doing a Buffy rewatch. So I'm just like living in a very different time.

Stephanie:

What is a book that has really left a very big impression on you? You're like, "I always think back to this book for either business or life."

Kelsey:

Oh, that is a great question. I'd say, well, what are the ones that comes to mind, it's Italo Calvino. [crosstalk] is the author. And basically, it's a person telling stories about visiting a lot of different cities. And when I was younger, I found that it was just... When you're reading, it's all about picturing what's going on. And as someone who, if you didn't grow up being able to travel a lot, it stuck with me. I was like, I want to be able to do that someday, but also just being able to picture it from a book is really, really nice. I still have like the images in my head of different passages from that.

Stephanie:

Oh, that's cool. All right. And then the last one, what's the nicest thing anyone's ever done for you?

Kelsey:

Oh my gosh. I feel like people are so nice. What is the nicest thing anyone's ever done to me? Oh gosh, there's too many things.

Stephanie:

Wow. You must be a very... People are sending all this nice stuff you way. [crosstalk] people around you, can I have some?

Kelsey:

When you run a business, or when you start a business, it's all about getting help. That's the best way to be able to succeed is knowing what you don't know and how to get help. So I will say I'm very good at getting help, but what's like the biggest part of that is having people be really nice and great. And so, there are just a lot of people that have helped along the way that I literally would not be where I am without that. From little things like making the introductions, not everyone has access to the networks that you need. And so, the people that believed in me more than the business or more than anything else, that's really huge.

Kelsey:

And so, I've just got like some really great, great people that helped along the way. I can't pick a single thing, but I'd say like some of our investors, some of just the people I've worked with in the past and they're really just root for you. And will be there when you say, "I have no idea what I'm doing. How does this work?" Or, "I need some help."

Stephanie:

I thought so. Good answer. All right, Kelsey. Well, it's been a blast having you on the show. I love learning about Paloma and your story. Where can people find out more about you and Paloma?

Kelsey:

You can learn more about Paloma, getpaloma.com, G-E-T-P-A-L-O-M-A. And me I'm on Twitter, LinkedIn at Kelsey Hunter. I think it's usually Kelsey AH. So feel free to message me, check out the site, chat with us. We're always around.

Stephanie:

Amazing. Thanks so much.

Flipping Ecommerce on its Head

info@mission.org (Mission) — Tue, 16 Mar 2021 07:00:00 +0000

Imagine this: it’s Black Friday, the biggest shopping day of the year and you’re a brand with customers on your website pushing the buy button, but instead of moving them down the funnel, you stop them and interrupt the buying process to ask them, “How are you feeling right now?”

Seems like a crazy thing to do right? Especially in a world that is dominated by closing sales and doing everything possible to get a consumer to hit buy. You’re literally pausing a conversion, making a customer examine his or her activity and second guess making a purchase. Nevertheless, that was the strategy Bearaby put into practice this past holiday season and the results might just surprise you.

On this episode of Up Next in Commerce, Kathrin Hamm, the Founder and CEO of Bearaby, tells us that that mindfulness experiment, while risky and not advised by her industry peers, paid off in big ways. Bearaby was able to gain insights into consumer behavior and gather data that helped predict whether or not a customer was likely to return a product or not. And, most importantly, Bearaby was able to build more trust with customers and foster a more authentic relationship centered around mental health and the customer’s well-being, which in today’s world goes a long way toward creating a loyal base of customers. Kathrin also explains why adding more mindfulness and behavioral queues into the customer journey could have a positive impact on return rates, overall customer satisfaction, and your NPS score.

Main Takeaways:

Do You Need This?: So many brands are trying to optimize for sales and push people through the funnel, but what if you took a step back? At Bearaby, by introducing mindfulness into the buying process and asking people how they feel throughout the process of a sale, the company was able to build trust with its customers, understand the behavior of people who returned products, and increased the overall net promoter score of the brand.
Making it Work: As a small, independent, DTC business, being agile and having the ability to accelerate a product are assets. But when you expand and begin to take on retail partnerships, your internal processes need to adjust. Rather than thinking a month of two ahead, you need to fit into a production timeline that is already planned two years in advance. To do that, it’s critical to have the right backend operations in order to analyze data and manage inventory so you can meet the needs of your partners.
Stop Selling, Start Connecting: Most brands see social media and SMS messaging as tools to sell products and get information to customers about deals or products. But what if you used those platforms to be a resource to your customers and offered them help in ways unrelated to your products? Bearaby took this road when establishing itself on social media and found that sparking natural conversations led to more curiosity about the brand overall, and subsequently led to sales with truly engaged customers.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hello everyone and welcome back to Up Next in Commerce. This is your host, Stephanie Postles, Co-Founder and CEO at Mission.org. Today on the show, we have Kathrin Hamm, the CEO and founder of Bearaby. Kathrin, welcome.

Kathrin:

Thanks so much for having me.

Stephanie:

Tell me a bit about Bearaby. I was looking at your website, I saw how amazing your weighted blankets look. They're knitted, they're awesome. I have a couple other weighted blankets, but they are nowhere near that, so tell me a little bit about the company and how you thought about creating it.

Kathrin:

The idea of creating Bearaby was really when I had sleep problems myself. I used to work for the World Bank as an economist, and I was just traveling a lot. I just had moved from Washington to the Middle East, and then from the Middle East to India, all within two years. I was traveling a lot and I was never a good sleeper, but this constant travel and jet lag really put me over the top. So I was just looking for a natural sleep solution. I tried many different things and at some point I came across this really simple concept of a heavy blanket that's supposed to be 10% of your body weight, that you put on top of you in an equal way, and it's supposed to help you calm, relax and sleep better.

Kathrin:

The concept itself is not new. Weighted blankets have been around for more than 60 years, especially for children that have sensory disorders. I ordered one of these blankets into India, and I tried it on a Saturday afternoon, and I napped for four hours. Which never happened to me before, and I was just sold on the idea. I'm like, "Okay, that's it. I can move on with my life, I just get this blanket and things will be good." The next night I woke up again and with the weighted blanket, but I was sweating and it was really hot.

Kathrin:

I think that's when I realized that all these weighted blankets are made with these artificial filling materials, so usually you find 20 pounds of plastic beads in it. Obviously it makes you hot, like an oven, but it's also really not good for the environment. At that point, I was really just searching for a product myself, and I realized there's nothing out there. Even though the product has been around for such a long time, somehow no one had really innovated on the concept. That's where the idea started to make something different and use innovation and design and at the same time try to come up with a product that's addressing these needs while being sustainable at the same time.

Stephanie:

That's awesome. So this was back in 2018 when you launched your company and you still had your day job and you launched it on Kickstarter, right?

Kathrin:

Yes.

Stephanie:

Tell me a little bit about that thought process. What was in your head when you were like, "Okay, I have a full-time job, I'm in India, and I'm going to go on Kickstarter."

Kathrin:

I think I'm naturally a risk-averse person. I know other entrepreneurs are like, I had my idea and I knew I always wanted to be an entrepreneur and I just went for it. I went the other way. I'm like, "Let's try it as a little side hustle and see it more of a project at the beginning." So I really mapped out in a business plan, so what do I need to have first? How do I think about the product? How do I think about the IP? And at some point you come to the funding, and when you do the numbers you realize that it actually takes a lot of money to launch a product or a brand, and you don't know in the early stages if people even will like it.

Kathrin:

It's when I realized that I think crowdsourcing is a good way to fail really fast or get feedback really fast. So we put together a short video, with the initial idea, and within a month, we had more than quarter million dollars already on the Kickstarter campaign. And the feedback I got from people is that this is just a product that more people are looking for, and I think that gave me then the next confidence boost to say, "Well, it might be not only a project, but this might be a real business idea that I can start exploring."

Stephanie:

That's very cool. So, what did it look like after you had that money in your Kickstarter account, and you're like, "Okay, this is real." What did it look like after that?

Kathrin:

Well, the money didn't last really long. So I actually emptied out my whole retirement funds. After I had had left my job. I think at that site, I really believed in the product and I knew I was onto something that I wanted to bring to the market. So the next step was the manufacturing. At that point, I had a prototype that I actually had developed together with my mom who's a really avid knitter. And we came up with the idea that instead of using any plastic or glass beads to make a product heavy, it's like a knitted rug. And if you use layers upon layers of fabric, you actually also get to a heavy blanket that comes up to 20 pounds.

Kathrin:

There was a small piece of a blanket. And then I went around and I just had a list of different manufacturers. I think I had a list of around 40, and I just picked up the phone and were talking to people. "This is my idea. Is it something that you could help me produce? Could you help me make this?" And I think one of the issues was that most people didn't know why do you even want to make a heavy blanket? We've been working in the industry since 30 years to make a light product, a light blanket. So I think that was an issue. Then I also obviously didn't have any credibility in the space where there's like, "Okay, even if we're trying to make this, how many units would you take?"

Kathrin:

And I'm like, "Maybe 100." And then I think they already hang up the phone.

Stephanie:

[crosstalk] thinks.

Kathrin:

So I got a lot of nos at the beginning. Yeah, I just realized that nobody had done this before, even with apparel that said we have similar we don't have these machines bedding, we don't have these machines. So I actually went back to the drawing board and without before I actually launched the Napa our product, I first had to come up with a machine to make the weighted yarn that we're using. I was working with a manufacturer in Germany, a machine maker. At first was creating the yarn to then go into the final production.

Kathrin:

So that took me quite some time to really figure out that supply chain piece. And yeah.

Stephanie:

I think most people would have given up when they found out they had to make their own machine. That's wild. What was your mom saying during that whole process?

Kathrin:

They thought I'm crazy. Because I left a pretty solid job that I studied for a very long time for. I have a PhD in economics. And then suddenly in my mid 30s I'm telling my parents, I'm leaving my job because I want to sell these heavy blankets that nobody had heard of on the internet. So, even my friends thought this is just a phase or maybe like a midlife crisis. And when you have these dinners with friends, where everyone is sharing like, "Oh, I got a promotion." Or, "I'm on to the next step." And I had for a very long time, I had nothing to share where I'm like, "I'm about to build a website. It's not there yet, just give me a couple of more month."

Kathrin:

And everyone was like, "Oh, yeah, that's very cute. Good luck with that Kathrin."

Stephanie:

Yeah.

Kathrin:

Yeah, it was sometimes not an easy time. Especially like the first year.

Stephanie:

Yeah I can imagine that's such a fun story. So now, you're partnering with big brands like West Elm. You've got celebrities who love your product. I saw Rachel Zoe and others love it. So how many blankets are you selling today? Yeah, I want to get into the partnership piece after that. But yeah, what does the world look like today?

Kathrin:

When we launched in December 2018, we just had our website, and we got an article on Fast Company. I think just five months later, where they were describing that this is the most sustainable weighted blanket in the market, and it was just a category that people got notice of and that was the time where it's like, this is a sleep solution and there are these weighted blankets and then we came already in a market where it was a product that was different, it was something you want to keep on the couch, something designed worthy and not something that you might want to hide in your bedroom.

Kathrin:

Then we got a call from West Elm just literally a week later. Actually first it was an email, and at that point I thought, "Probably it's not real. Maybe someone is scamming us." But I thought, "Well, doesn't hurt to just jump on the call and have a conversation." And yeah, I ended up speaking with the buyers and they were excited about the product, they were excited about a category, and we're looking into it also for some time and they liked the idea of having a sustainable option that also fits with their interior design. While they asked me where's your showroom, and at that point, we're like, "It's actually my living room. So we don't have a showroom yet."

Kathrin:

But they still took a chance. And we were a very small company at that point. And they helped us work through the process of getting on boarded with such a big partner very early on and working on the color collections. I think we learned a lot from a design perspective and that now we've expanded the partnership, we're now also in Pottery Barn Kids with our kids collection and it's turned out in a really beautiful partnership which I never had expected or hoped for that early in the stage of the company.

Stephanie:

That's amazing. Have you already sold some blankets? Were you doing DTC before West Elm approached you?

Kathrin:

Yeah. So we started B2C as a primary channel. That's just for the reason that I wanted to educate people around the product, because I felt a lot of people still didn't fully understand what are the medical benefits of the product? How do I choose a product? I also wanted to create something that's different from other weighted blankets where it's really [inaudible] and into something, it's healthy to talk and there is actually joy in napping. So this branded experience, I knew I could only establish on our own website. So we didn't think about any other channels at that stage.

Kathrin:

Really we're focusing on how do we communicate that we're different? And how do you communicate the heaviness of the product without people being able to touch it?

Stephanie:

Yeah, that's tough. So how did you show that value on the website?

Kathrin:

I think that's still one of the most asked questions that we're getting why people are figuring out what's the best choice for them. We came up actually with a customized quiz, where we work with a sleep scientist, where people just ... we didn't keep it too long. But just a couple of questions that give people a guidance. Were this is the right product, there's a recommendation that comes out at the end of it. And then we also have a detailed section that goes into the fabrics, the different options that we have and how it makes you feel.

Kathrin:

But I would say it's definitely an advantage for us to have West Elm as a partner because if people are still unsure on, we don't know what a weighted blanket feels like, I can tell them, why don't you hop on a bus and go into the next West Elm store and to see and test it out there on the couch there when you come and you can try it out, and most of the people actually really go right away and enjoy trying it out.

Stephanie:

Yeah, that's really cool. So how did you go from being DTC to then all of a sudden, you're going to be ... you have to expand your stock, you have to start selling nationally. What did you have to do behind the scenes to make it work with West Elm?

Kathrin:

It's really a process that we needed to prepare for from an operational standpoint, because when you are a smaller brand and let's say you have shorter planning cycles. So when we have an idea, we're saying, "Oh, we would like to come up with this color, we want to try this." It usually takes us more or less like two months to bring that style on our website, because we're very agile as we're producing in house. But now with a retailer, we had to see ... when we talk January, we're like, "Okay, let's talk March guys." And they're like, "We're already in March 2022."

Kathrin:

Like a year later we're like, "Oh, okay so, just the planning cycle and then adjusting the volume for it means that we need to have the analytics in place the inventory planning." It forced us to some extent to really look for the numbers and have our inventory planned out and the analytics on what are we selling and how are we converting on the website? And then how do we allocate the volume to West Elm? So that was one piece. The other piece is obviously supply chain that became in the beginning just much more difficult. So we had to onboard an additional warehouse to just fulfill the requirements ... coming from the labeling and the other requirements that we had to do.

Kathrin:

So it was a really ... I would say stressful time for the team. But I think having a partner who guides you through it was helpful too. And I think now we've done it and we really learned a ton in these couple of months. It also helped us I think we prospectively just be better as from a operational standpoint.

Stephanie:

Yep. So, what happened this past year when it came to COVID and holidays and Black Friday? Was there anything interesting there that you had either planned for or that you found out after the fact?

Kathrin:

Generally we saw an increase in demand, especially with people being at home. People were more looking for the product. People had struggle with sleep and anxiety levels went up. So, we've seen really a spike in demand, which we try to fulfill from our end from a supply chain perspective. Then again, on Black Friday there was another spike. But this Black Friday, we actually decided to go on a different road. Usually as you know, Black Friday is the biggest sales day of the year, and every brand is getting ready. What we actually did is we literally slept through Black Friday.

Kathrin:

We came out with a black blanket a black Nappa for Black Friday. And we wanted to introduce the concept of mindfulness around it, because our hypothesis was that mostly we're buying a lot of stuff at a discount that we don't really need, it ends up in landfills and it doesn't make us happy. So we wanted to see first of all how would it be if basically our website is shut down, and people are sleeping through Black Friday. And then if you still want to come back the next day, we're still making it difficult for you to get the product. So we had designed a website experience where you only were able to access the product when you actually slept on it.

Kathrin:

In addition, what we wanted to see and we worked with behavioral scientists on a component of feelings, so you're evaluating your feelings and how you are mindful when you purchase. We work with Duke University and the Advanced Center of Hindsight. And basically how it worked was you come to the website and before you click to purchase, another question box pops up that literally makes you pause and asks you how are you feeling right now. And not like the normal, how are you and then you move on but we wanted to have people reflect on it and ask people do you really need this product right now?

Kathrin:

And if yes, how are you feeling? Are you anxious? Are you calm? Do you feel lonely, sad, happy? And what we found is that, first of all people were really excited about this campaign, that it made them feel like maybe I don't need a second blanket. And what's most surprising for us was that people who were anxious, were five times more likely to return the product afterwards. But people who were calm, or people who felt grateful while buying the product, we had close to zero returns on that. So this is something which I was really fascinated because I think for us as brands as we move through the learnings that we had in the last years, I think people are more conscious about what we're buying.

Kathrin:

But I think for brands we also think this is now expected and what can we do actually to take the customer experience to the next level and as more and more brands are coming on to ecommerce, is how do you establish the trust actually as a brand? I think that aspect of mindfulness and not pushing people to buy, and if there's a business case that we actually can show this is not only good for the consumer, but it's also good for the brand to actually have more mindful purchases instead of driving people aggressively down the funnel, this is something I was very excited about the results.

Kathrin:

And we will pilot and test more and work with our community to see how we can actually bring mindfulness into the ecommerce purchasing experience.

Stephanie:

Wow, that's such an interesting test. So it's different than I guess a lot of brands right now who are so quick to just try and optimize for that sale, quick conversions. And sometimes, especially the earlier ones and now you're even thinking about the returns later on that are very expensive. How are you taking those learnings and applying that into your business going forward? What new tests are you doing? How are you thinking about things differently now?

Kathrin:

So one thing is definitely the returns for a product that on average is 20 to 25 pounds. Our shipping costs are quite high. So how can we actually optimize that we really have an experience for customers that it's a purchase decision that is well thought out through. And that we're actually helping people to guide them through the decision. One is the science of sleep science quiz that we have on the website, where we really educate people along the way to make the right decision on what product they should buy.

Kathrin:

But we will systematically also test in the next couple of months on what are different interventions that you can take before you click on the buy button that has a calming effect on people. Furthermore, one thing is obviously returns. But then, would that also help people to feel more satisfied overall? Is the net promoter score going up of people who basically were in a mindful state while buying and testing different interventions? And we work obviously closely with the behavioral science lab on that to find these different ways on inventing on the brand, and inventing on the consumer experience and not only having a mindful product that should bring a relaxing effect, but also how can this be a holistic experience for the brand?

Kathrin:

Because if I'm sending you three abandoned cart emails, you have to buy it now it's gone. It's just also contradicting for what we stand for as a brand. So I think that's really something where I want to look into how we can expand that experiment, and bring it across every touchpoint in the brand cycle.

Stephanie:

Yeah, what are some example tests that you're doing that you're like, "I'm not sure if this is going to work, but we're trying out this to see if we can convince the consumer to get into a more mindful state and then come back when they are." What kind of things are you testing out or are the behavioral scientists testing out right now? Or thinking about doing?

Kathrin:

One thing is obviously connection with people. So, if one thing is you being aware about what you're feeling right now, but then the latest is that there is a digital map where you actually can see, it opens up and then you can see close in your area, there are 10 other people at the moment that feel similar to you. So, elements of community and connection. And if it's just on a website, seeing and that makes you actually realize, it helps you realize your own feelings to a larger extent that you're not alone in front of this website and trying to buy something, but it puts things into context.

Kathrin:

The other things is gratefulness. So one of the things we found is that if you're feeling grateful, that increases your happiness and your satisfaction with the purchase. So how can we increase that through for example like giving back and giving consumers the option of choosing a giving back component while purchasing while checking out? That's the second thing. Another interesting approach that we already tried for Black Friday was a poem. We worked together with a poet who created a really beautiful poem that just came up before clicking to purchase.

Kathrin:

The topic was not generally about mindfulness, but really reflecting on who you are as a person, why are you buying this right now? And yeah, it's a very beautiful, stunning piece that Adria had developed for us. I think that emotional reaction of people really is something that was stunning from a results perspective.

Stephanie:

Yeah, that's really cool. That's ... like I said, just such a different mindset than what's happening right now with a lot of companies. And not only is it good for consumers, but it's good for business. So, how much did you see returns decrease compared to before when you weren't doing that? What savings was your company experiencing from now doing this and trying this out?

Kathrin:

My initial hypothesis was that conversion rate would go down, because if you're making it that difficult for people to get a product, you're asking them to wait, sleep on it and you're ask them ... Listen to a poem, take a breathing exercise, tell me how you're feeling and then take into a consent form before you then finally can buy the product. So I was actually expecting that we don't sell any of these blankets. I was telling the team that was working on it I'm like, "I think if we're selling two blankets that would be already a good result." And we were quite surprised that our conversion rate was double than to our regular conversion rate.

Kathrin:

Now our return rates again, have less than half the return rates than our usual process. And we had the project run for three months to really collect a robust set of data, and I think we're really onto something with this whole concept of calm buying, that goes a bit in the opposite direction of optimizing and driving people down the funnel of thinking if there are actually other ways more authentic and honest ways as a brand to communicate, and I think so far is what we see actually the numbers really speak for themselves.

Stephanie:

Mm-hmm (affirmative). Yeah, that's really fun. Such a different conversation that I've had so far on the show which is just really exciting. So what did your partners think about this test? Were you working with West Elm at the time? And if so, what did they say when you're like, "Conversions could go down to zero, but there's something better coming."

Kathrin:

So this was actually something we only tested on our website, because it's quite complex. So we couldn't roll it out. And I actually just got these results in last week.

Stephanie:

Got it.

Kathrin:

So everyone was like, "You guys go first." If we monitor and it's a nice idea. But let's see how that turns out for you guys. We were all nervous obviously. Black Friday is a big sales day and like having the potential that you are losing out on that day, definitely was making us uneasy. But our partners also said, "We're quite curious to see good luck with that." So I think that's why it's even more exciting now that we say, "Hey, we're actually onto something that we probably could build up on and maybe even share with the broader community of B2C brands." I know it's like a lot going on and there are a lot of shifts in what's happening and there's maybe an approach that ... yeah, we're happy to share the lessons learned that we have and maybe more people are coming on board and see if it works for them as well.

Stephanie:

Yeah you're reinventing the DTC playbook and thinking about it in a whole different way. Have you had other brands who are interested in trying this out or that you've talked to where you see an interest in the industry?

Kathrin:

I think the early conversations that we had especially brands that are focused on sustainability. That is, we had initial discussions where people are surprised that it really matters or it directly impact conversion and it impacts our return rates. So I think there is an opportunity to build that with a smaller group of friends and innovate on it. But yeah, it's early days, so I think we will work a bit more on getting some more findings and testing a bit more what works the best. And then obviously sharing it with everyone.

Stephanie:

Yeah, that's great. So where are you headed? What are you hoping to do with Bearaby over the next one to three years? What are you guys innovating on or looking into or trying out outside of the already cool work and behavior science that you're testing?

Kathrin:

Yeah for us, it's I think, looking into what consumers are expecting from us is definitely I think a lot of the things that happened during COVID will stay. People are expecting such deliveries from us, almost same day deliveries, so we were piloting on same day to our window delivery options. I think that's something where, how can we make it easy and comfortable for people to not leave their house yet, but still get their product in a timely basis? How do we set up from a infrastructure perspective that we're able to hold that pace? I think that's something that we're looking into. Then just generally, we're always interested in looking into new products and new product innovation in the wellness space.

Kathrin:

Obviously we launched last year the children's edition that we really also launched from a direct demand during COVID, what we heard from parents that were homeschooling children. And I think that just listening to our customers is one of the things that we also I think probably started. In crowdfunding you always stick to the principle. Whenever we have a new collection coming up or a early product idea. We have a small group of people from our loyal customers, we call them the Nappa hood club, that can try out products and where we get feedback and listen to it.

Kathrin:

And Instagram for example when it comes to color selection, we just discussed our fall colors that are coming out. And yeah at the end, we took two colors out that people on Instagram were not excited about and literally gave the whole vote to the community of the colors that they want to see. I think that's another interesting thing where obviously we always took feedback from people, but in a less systematic way, and now we're really putting the consumer first and the decisions that people are telling us and the colors we will put on the market. Even despite maybe some other designers that would go for other colors.

Kathrin:

And yeah, let's see how it goes.

Stephanie:

Yeah, that's great. How did you build up an audience on Instagram? Because I was reading it, quite a bit of it was organic and you were more interested in working on the supply chain stuff and sending out samples and get on people's radar. So how did you build up your Instagram now where people are actually commenting and giving you feedback?

Kathrin:

I think on the early days, I didn't have much experience on Instagram. So I really had to test and figure out what works. What I think what works well for us is one of the things is that, we're trying to be helpful for the community. So, instead of just us as a brand talking and sharing what we have new, especially during the last year, we realized a lot of the community is actually struggling with mental health anxiety. So what we did for example is that we used Instagram connect it to a SMS platform. Where usually you send SMS to inform people about the sales. But then we use it in a reverse way where we had actually an expert sitting on the other end of the line.

Kathrin:

Psychologist or this general mental health counselor where people could send in their questions that we got from Instagram but that also we got through SMS. So we connected both platforms and I think what the beauty of that was is that mental health often is a very personal issue, it's not something that you want to have on Instagram life, if you have a question. So that's why people could actually send the SMS question in privacy and there's an expert answering it expert from NAMI. I think that helpfulness and where people say, "Well, this is actually relevant content." And we're asking them, "So which expert do you want to speak to?"

Kathrin:

And ranging from people who have a longtime experience on how to homeschool children, now teaching people who just have to deal and have to get to learn how to get into that new mode. We brought all these experts and we had to message this community of helpfulness and chat. And I think that just sparked a natural conversation and I think then people stick on and want to see what else the brand is doing and I think if we listen to that and we are reciprocating and not shouting out but we're listening, it's just organically ... the community grows and is also excited about the brand.

Stephanie:

Yeah, and that's awesome. You're once again doing something in a reverse way. I love it. It's so contrarian but also yeah, amazing to hear how it's impacting the community. Would you take their questions or would the experts take them and answer them on Instagram Story or something so others could benefit from the questions coming in? Or were you making it more one-to-one where they were actually responding in a text to that person?

Kathrin:

So what we did at the beginning is like you're sending in a question and it's really a one-to-one answer. And then what we did for the community later is that we anonymized the questions and then have them on Instagram Stories for people to learn basically what the most common answers were. So you still have that one-on-one feeling especially for things that are personal, but then we're still making it available, and just routinely having these cycles where it's like, these are fixed dates where we announced this as the expert that we're having on the line. So people can share questions in advance. The experts can prepare for it because they have to take on a back end a lot of questions, because it's really this one-on-one conversations.

Kathrin:

But then making sure that we can scale it to a bigger community later so it's really helpful and it also stays there as a reference and as a helpful resource in the future.

Stephanie:

Awesome. I love that. All right. Well let's shift over to the lightning round. The lightning round is brought to you by our friends at Salesforce Commerce Cloud. This is where I'm going to send a question your way and you have a minute or less to answer. Are you ready Kathrin?

Kathrin:

Yes.

Stephanie:

All right. First, what one thing will have the biggest impact on ecommerce in the next year?

Kathrin:

I think the centralization of data. Where we have more different inputs from supply chain, from customization and customer journey and how do we actually get that centralized in one place and created experience for the consumer that's helpful and adapts to their needs.

Stephanie:

I love that. Have you seen anyone who is doing a good job in that space so far that you're watching?

Kathrin:

Generally I'm always looking at what Tesla has been doing. I think if you look at the example on how they really reinvented a space that no one thought it's doable, that you have no car dealers and that you actually have software on the car. I think just thinking about ideas that are a bit broader. So obviously we're watching what the latest trends are on B2C. But I think it's also really helpful to see in other industries that have been completely reinvented. And see what were the initial impetus that we can take as obviously as a smaller brand, we're not Tesla, but taking bits and pieces after thinking and put small bets and test what we can do to maybe reinvent the wheel at a small point and then scale it from there.

Stephanie:

Yeah, that's great. Yeah, Tesla's always a good one to watch. What's up next on your reading list?

Kathrin:

I'm just finishing up the No Rules Rules of Netflix, reinventing culture. I think now that we are getting bigger as a company, we're having a lot of similarities that I guess every startup is going through. You're a small group and everything is informed and you have no rules, and then suddenly you're more than 20 people, 25 people, and how do you actually keep the culture as it is without limiting people and the creativity and establishing artificial rules and too many approval processes? So how can we stay agile as a brand? Again, we're not Netflix, but I think there are a couple of things especially early on that you can take from the book.

Kathrin:

One is really the transparency that even if it's uncomfortable, if things are going wrong, is that we talk to everyone. So there's no hidden desk or anything with any documents, we keep our revenue information for example, for everyone visible on the board, so people can see how we're doing. So there are no secrets. And I think that just brings a level of accountability to the team, and without us having to establish rules that limits the strongest performance and people were actually most excited about driving things forward.

Stephanie:

Yep. Yeah that's great. That's a good book too. What's one thing that you don't understand today that you wish you did?

Kathrin:

I would say, some of the new channels TikTok is one of those where I wish I would be earlier to the game. I think there are a lot of interesting things going on, and I'm getting actually taught by people who are much younger than me. What's going on? So I think, for us going forward is like, how do we expand beyond the channels that we learned and we are good at and where we have an established community and how can we go about new things and finding out about it and placing small bets, trying something and see if it sticks? But yeah, I think that's something always good to be early to the party.

Stephanie:

Yep. Yeah, I agree. All right, Kathrin, this has been such a fun interview so different, which I loved. Thank you for coming on. Where can people find out more about you and Bearaby?

Kathrin:

Yes, you can find more about us on bearaby.com. And you can also find us on Instagram. And our handle is @mybearaby.

Stephanie:

Thanks so much for joining us. It was a pleasure.

Kathrin:

Thanks for having me.

Expanding Through Collaborations and How to Move From B2B to DTC

info@mission.org (Mission) — Thu, 11 Mar 2021 06:00:00 +0000

Sometimes, it’s best to get back to the basics. Whether you are talking business or just general human interaction, it’s easy to get caught up in the whirlwind of overthinking things when really all you need to do is keep it simple.

Ellen Bennett knows this more than most, and she’s built her company, Hedley & Bennett into an undeniable success by sticking to that principle. Hedley & Bennett produces high-quality kitchen wear that has been featured in more than 4,000 restaurants and cafes, adopted by celebrity chefs like Martha Stewart and David Chang, and is used by hundreds of thousands of home chefs every day. But the story started much more modestly. Ellen began with a true grassroots approach, selling aprons out of her Mini Cooper, talking to and pitching every chef she knew, and working her connections to keep growing her business.

On this episode of Up Next in Commerce, Ellen shares the story of how she hustled to build Hedley & Bennett and all of the early struggles she had to work through to keep the train rolling. She gives advice to any young company dealing with production or shipping mishaps, and she explains how you can go about expanding through creative and authentic collaborations. Plus, she explains what it took to shift the company from exclusively selling B2B to now selling more than 80% DTC. Ellen brought a level of energy and ambition to the interview that didn’t disappoint, and I hope you enjoy it as much as I did.

Main Takeaways:

Howdy, Partner: One way to expand your product line without taking on the entire risk and expense of production, testing, etc., is to form a partnership with companies that already make products you are interested in selling. By partnering with Madewell and Richer Poorer socks, Hedley & Bennet was able to expand its product line and grow its audience and customer base without having to add to or adjust the supply chain.
Pick Up The Phone: As a young company, any mistake could be a dagger to the heart. But, things happen and sometimes you have to swallow the cost of a mistake for the overall good of the business. The best way to do that is to be honest, take responsibility, and do it one-to-one. Make the hard phone call instead of hiding behind an email. Your customer might be upset that their order was messed up, but you will build respect and trust when you show them you’re making a personal effort to make it right.
From B2B to DTC: It may seem obvious, but moving from almost exclusively selling B2B to having 80% of your products sold DTC is a massive shift. Tune in to hear what that looked like for Hedley & Bennett, and advice for any company considering this move.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Ellen Bennett:

Great. Hi guys. My name is Ellen Bennett and I'm the founder and CEO of Hedley and Bennett.

Stephanie Postles:

Hey everyone. And welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder and CEO at Mission.org. Today on the show, we have Ellen Bennett, the founder and CEO of Hedley and Bennett. Ellen, welcome to the show.

Ellen Bennett:

Thanks for having me.

Stephanie Postles:

Yeah, I'm very excited to have you on. You're the first person with a outfit change that we've had before getting on. So it's a good day to have a new thing occur on a podcast interview.

Ellen Bennett:

I love color and I brought a light yellow cat and I had a dark yellow hat. So I just changed to a dark yellow hat in case everyone's wondering, what the hell is she talking about?

Stephanie Postles:

Yep. This is working for me more now. So now I'm ready to get into it. So your company looks awesome. I saw that Hedley and Bennett, you guys are creating handcrafted aprons and you're in over 4,000 restaurants and coffee shops, which is wild and crazy. So your story seems like one that I want to go back to the early days. Like before, you're in all these restaurants and coffee shops, how did you start? How did you even get into this industry?

Ellen Bennett:

So I used to cook professionally. I worked at a two Michelin star restaurant, hated our uniforms, and I wanted to make them better. I wanted to make people feel empowered and awesome. And you hear, oh, she has an apron company and you might think frilly, curly aprons, but I need you to stop what you're doing right now, go to our website to hedleyandbennett.com and check it out because you'll understand pretty immediately that we are the polar opposite of that. We are a really awesome collection of colorful, very well-made, very high quality products, which are kitchens, gear and aprons.

Ellen Bennett:

And it began with this idea of just make a good apron for the restaurant world, make the perfect apron. And it quickly evolved into this giant community of chefs that also felt like they needed that same product. And it was just me out of my house, out of my mini Cooper, running to farmer's markets, talking to chefs, really doing a very grassroots marketing approach to everything because frankly, I didn't have any investors. I didn't have any outside capital. I had me, myself and I against the world and my product. So I began with that and just built off of it, reinvested every penny I made back into the business and grew it chunk by chunk brick by brick. And it took time, but I believe that the good things take time. So I've been happy with our journey. We are eight years in now.

Stephanie Postles:

Awesome. So for anyone who has not worked in the restaurant business, which I have but I've not been back in the kitchen. I was like server, bartender, shot girl, hey. What makes a bad apron and what did you hear when you're going out and interviewing people and kind of doing that market research to create what you have today, which is an awesome, but sturdy looking apron. I saw one on your website with really cool pockets, but it was very trendy, but also look [inaudible]. How did you get there and what were you wearing before we were like, this sucks?

Ellen Bennett:

Yeah, totally. So before Hedley and Bennett was born, aprons were very much just a commodity as something you didn't think about, you didn't look at, it was just a very, very thin piece of material probably made out of polyester with a strap that wrapped around your neck. And that hung probably below your boobs, like really not fitting on a man or a woman or whoever. And it also had like shoe lay strings around the waist. It didn't adjust in any way and that was it. There was nothing else to it. And what I did with Hedley and Bennett is we made it a whole world. We made it a community. We made it mean something. And from the get-go we had people like Martha Stewart and David Chang and Nancy Silverton. And if you watch any show on TV right now from Top Chef to any show on the food network you will see this little red and on the chest and that is the heavily amended apron.

Stephanie Postles:

Wow. Okay. You [inaudible] right to the crazy success story now. Now, [inaudible] how did you get in front of Martha Stewart? How did you secure all these partnerships like that, that's crazy.

Ellen Bennett:

Believe it or not. And this is the 80 year old within me. I always say I'm like an eighty year... I'm secretly an 80 year old man, because I do things the old school way sometimes. I believe in really high quality always. And from day one we made a product that really worked and I've always listened to our customers deeply. Do you know what an NPS score is?

Stephanie Postles:

Yeah.

Ellen Bennett:

Yes.

Stephanie Postles:

Net Promoter Score.

Ellen Bennett:

Yes. So our NPS score is 80. And that's very high above industry standard, which ranges in the 60 camp. And we are constantly at 80 plus. And the reason we're in that camp is because we've never skimped on the quality of details. The fabrics that we use are everything from Japanese denims, to Italian chambrays to materials that you can beat up again, and again, and again, and this thing is going to last you forever. So you have the craziest chefs out there in the world wearing our products for so many years. Believe me, I got feedback throughout the years. So these kinds of guys, they just love the quality. They loved that it had a point of view and that you could have your own vibe. You didn't just need to be wearing a white apron. Why not have yourself have an identity in the kitchen that was more than just strap a white apron on.

Stephanie Postles:

Yep. But how did you get in front of them? Did you send them free samples to try and show them quality? How did you even get in front of these top shows?

Ellen Bennett:

A lot of it was word of mouth. So one chef would take it to an event and another chef would see that little red patch on the chest and be like, "what is that?" And then they'd say, "oh, there's a girl, her name's Ellen." They would call me the quote unquote apron lady. "Oh, you got to contact Ellen. She's making awesome stuff. These were the early days of Instagram. And when I went and met with David Chang, for example, in New York, I was introduced to him by a chef I met in LA. The chef from LA was like, "if you're ever in New York, let me know." And I of course let him know. So I reached out before I showed up to New York and I was like, "chef, I'm coming to New York. I'm so excited to come see your spot."

Ellen Bennett:

I was very interested in what he was doing and I happen to have aprons with me. So I obviously was going to show him when I was in New York. And he said, "yeah, come by my restaurant." I stopped by, I showed him aprons. He bought some from me and then he's like, "well, how else can I help you?" I was like, "you know what, I'd love to meet a few other chefs who do you know?" And he's like, "oh, David Chang is a good friend." Like, "can you reach out to him right now for me? I'll come over today." And he was like, "yeah, sure." And so then that chef emailed David Chang. He responded in like an hour later. I was standing inside Momofuku, convincing David Chang to buy aprons from me. And David was like, "I don't know who you are."

Ellen Bennett:

He was really nice, but there was nothing about Hedley and Bennett that existed the way it does now in the industry. But I was so excited at the idea of getting him aprons that I was like, "all right, do you need it on consignment? Do you need net 60? What do you need? I'm going to give it to you, but I'm not walking out of here without you wearing Hedley and Bennett. Because, I promise you're going to love it." And I had enough conviction in my product that I knew once he actually had his team wearing it, they would love it. And sure enough, David Chang and his restaurants have worn Hedley and Bennett for six plus years now.

Stephanie Postles:

And did they buy that day when you-

Ellen Bennett:

They did. They ordered 50 aprons, custom aprons from me. And he's like, "I don't even know how you did that, but all right, I'm excited." And I was like, "yay." And then I took a picture with him, put it on Instagram. Just using what I had, honestly, it was like focused on what you have and not what you don't have. And I was like, I have myself, I have this great product and I have a new customer. I'm going to talk about it. It was very basic, but I kept doing that again and again and again. And the flywheel just started spinning.

Stephanie Postles:

Yeah. That's such a good reminder too, about asking your current customers or your network for referrals. I think a lot of people feel awkward and uncomfortable about doing that. Especially when you make a sale to someone to then be like, and now I'm going to ask for that extra thing. But I found that usually people always say yes, like "yes, I'll try and find someone else in my network to help you. Yes. There's someone else that I know," but they wouldn't think about offering that up right from the beginning. But when you ask it's like all these doors open, I think not enough people ask though.

Ellen Bennett:

I agree. And one of the things that I've always championed within our organization is never treating people like a transaction. So when you are being friends with people and you actually care about them, and you're not just caring about making that sale, people are willing and much more willing to help you. And also if you are excited about what you're doing and you genuinely are there because you're trying to help in some capacity, I've just found that everyone is willing to get on that bandwagon. Like when that chef reached out to David Chang, he's like "this girl she's got hustle. She's figuring out. She's got this business." They appreciate when people try. And so you just kind of want to help people that are out there going out of their comfort zones.

Stephanie Postles:

Yeah. I completely agree. So how did you go about, getting back to the earlier days, like you're not a designer, you didn't have background in that. What was it like getting into that industry and trying to figure out, how do I get a product manufactured? How do I pivot that when I have feedback? Somethings going wrong. What did that look like? And what were some of the lessons from those early days?

Ellen Bennett:

I had some orders go south very frequently at the beginning. And they were very expensive as a tiny, small business. One of them being Bryan Voltaggio he ordered the biggest order I'd ever gotten. I think it was 150 aprons. And we had a mishap in sewing land and the sewers just didn't get it done in time. And we were on them and we were hounding them and they had a restaurant opening. And so you can imagine delivering 150 aprons after the restaurant opens on the other side of the United States is not right. And we had to just suck it up and make it right. I refunded part of it. I overnighted stuff. I covered the cost of it. I called the assistant and spoke to her personally and said, "I'm so sorry. This is what occurred. It's on us. We really messed up and we're going to make it right." And just owning your mistakes, especially when you're a small business hiding behind emails, this is where my 80 year old man comes out, pick up the phone.

Ellen Bennett:

There's nothing like human contact, especially when things go South. Do not try and resolve a problem or a deeply rooted issue on an email, have the balls to call the person and fix it. And people really appreciate that. For as technologically savvy as we all are, human connection will never surpass an email. I mean the other way around. So, that was a lot of what I did at the beginning when things went South. I would pick up the phone and call people and be like, "tell me what happened. How can we make this right. We'll take care of it." And we bid it many times where we covered costs on stuff.

Stephanie Postles:

Is it usually delays type of issues that-

Ellen Bennett:

It was delays, or there were errors on the fabric, or maybe it was a new fabric we were testing. We didn't test because we didn't even know to test fabrics. And so it may be a bled on their clothes. You name it, it happened. And there were times when customers absolutely were like, nope, you ruined it. And we had to go out and find other customers. But overall we were always very humble about our mistakes and just listened, fixed and course corrected pretty immediately. So if there was an issue with one type of material and we had several customers, we would proactively reach out to the other customers and say, "hey, it turns out there's something wrong with this. We need to fix it. We'd like to recover those products. We'll send you other ones. Let's make it right."

Stephanie Postles:

Yep. Got it. So how do you go about ingesting feedback now that you're in the 4,000 plus restaurants and locations? How do you take feedback like you did in the early days, which was probably much more like, one-off where you're like, "oh, good tip. I'm going to change it." What are you doing now with everything coming in.

Ellen Bennett:

Right. Yeah. Back in the day I was the windshield to the business. So I could kind of take it all in every single bit. Now we have a pretty extensive set of meetings and spreadsheets from every part of the business. So our social team online is feeding information in from Instagram and TikTok and direct messages that we get. My platform at Ellen Marie Bennett is pretty front and center too. So people will reach out to me directly and say things. When things are wrong, you hear about it. So I funnel that over to our social team, and then they aggregate it all and have a weekly meeting like an interdepartmental meeting between marketing and sales and production to ensure that those things are getting changed or fixed.

Ellen Bennett:

You can put a lot of technology behind that and aggregate surveys and things of that nature too, which we do. But I've found that just getting the right people on a cadence of a phone call has been really helpful to ensure that our e-comm team is making corrections to the site where things are difficult for customers or our product team hears about that one trending topic where this one apron is wrinkling in a way that none of the other ones do, so then we start course correcting on that. One of our values as a company is never stop improving. So we are constantly tinkering, and fixing, and tweaking, and editing and adjusting. And because we're also controlling the supply chain, it's easy for us to do that. It's not like we product one year out and then we can't adjust it. We're constantly adapting it.

Stephanie Postles:

Yeah. That's really great. Controlling that entire process from start to finish. As you've started to scale and grow, and you bring on more executives onto the team, you've got a CFO, have you ever felt a pull to kind of sacrifice quality here and there in the pursuit of better margins, because that seems like something a lot of businesses struggle with as they get bigger. Sometimes there's a point where you're like, eh, I remember the early days it used to be this and now... Have you felt any of that pull yet? And if so, how do you think about that?

Ellen Bennett:

Such a great question. Honestly, I've found that because we have a bigger team, we are able to scale with more infrastructure. It's just easier. And we actually have time to negotiate and we actually have time to buy in bigger volume on raw materials. So it helps our margin in the long run. So we've actually been able to maintain a lot of the same suppliers we used from the get-go, but grow with them. And because I started with them with one roll of fabric, and now we're buying tens of thousands of rolls monthly it's a very different relationship and they really appreciate us. Because also, back to my being an 80 year old man days, I never had any debt and I always paid everybody on time. So our vendors really valued us and value us to this day, because we're not on net 60 terms or anything with them. We pay them every month with no delays. So, that creates a lot of partnership. They want to help you because you've always helped them.

Stephanie Postles:

Yep [crosstalk].

Ellen Bennett:

So I've actually found the margin has gone up as we've scaled versus gone down. There was a long time there in Hedley and Bennett that we sacrificed quite a lot of margin to hit the quality that we wanted. And we did it anyway because we believe in quality first and foremost.

Stephanie Postles:

Yeah. That's awesome. And such a good point, too, of like, if you're scaling and growing your margins should get better. You don't always have to sacrifice on quality, but especially leaning into that relationship with your partners can really work wonders which is great.

Ellen Bennett:

Exactly. And just because somebody's price, what they offer you is the price that they're offering you doesn't mean you can't have a conversation. Just like I asked that chef do you know anybody? It's like, hey guys, is there anything else we can do to get this down? Are there other costs that we can adjust to bring your costs down? Is there anything we can do on our end to help mitigate some of this? And you find ways of being collaborative and your partners tend to say, yes. It's not just the hard balling them and trying to squeeze a penny down, but really listening to them and listening to your needs and finding a happy medium, a solution.

Stephanie Postles:

Yeah. Awesome. So at what point did you start to think about introducing new products? When were you like now's the time to have a new product come live?

Ellen Bennett:

Yeah. When we first started everything was pretty much B2B. So business to business and the company, all of these restaurants that we were in, and chefs we were outfitting like that was our bread and butter. And it created a lot of great cashflow because we would take a deposit at the beginning and ship the product once it was made, collect the other half. And the business was able to grow in that way. Organically though, behind the scenes, our D2C our direct consumer business was growing because all these people were seeing us on Food Network or Top Chef, you'll see that little red square ampersand patch on the chest and say, what is that? Oh, my favorite chef is wearing, I want to wear it.

Ellen Bennett:

So we were building this like online presence without even meaning to in a way. And I wanted to make product that resonated with all of our newer customers online and make something special for our restaurant customers. So I thought collaborations, that's the best way to do it. And that's where I got our toes dabbled into the world of new product. And we started with I believe one of our early collaborations was with The Hundreds, which is a really cool street wear brand here in LA. Then we did something with Parachute home, we've since gone on to do a collaboration with Vans and Madewell. But every single one of those collaborations brought us new eyeballs, it brought us new community and it brought something really fun to talk about.

Ellen Bennett:

And we never did it with anyone we didn't actually believe was a good partnership. It's like when you see a brand team up with, I don't know, they could be something totally different. And they team up with like an airline. And you're like, what does that even mean? What are you guys doing? We never did that. It always had to be genuine. And that really helped us get into new products because we were able to test and see what people responded to. So we launched a line of chef socks with this one company called Richer Poorer and everyone was like, "chef socks. What do you even mean with that?" And, oh my God, these chefs socks to this day, we still sell them. And we have an ongoing partnership now where they make our socks.

Stephanie Postles:

What are chef socks? Is it just comfy or thicker.

Ellen Bennett:

So you could wear them. They have compression but they're super colorful because obviously Hedley and Bennett is a really colorful fun company. And they also have fun sayings at the bottom. So it'll say like wake up and fight or whatever. So you've got, put your socks on and get out there and like kick at life.

Ellen Bennett:

So, that was a way that we got to test a new product be resourceful. Because, we didn't have to go make our own supply chain to create SOPs. And then we were able to tap into their network of community and world.

Stephanie Postles:

What does the breakout of work look like when you're partnering with someone like Madewell, because maybe it's not a sock company. It's like, we'll make the socks you target them to your audience, we'll do our thing. What does it look like if it's more of a big brand or like a Vans where it's like, okay, you've got your designs and things like that. Like who's doing what work?

Ellen Bennett:

Yeah. Such a good question. So when we did our collab with Madewell, we created the aprons. We manufactured them and they manufactured all of the apparel. So we did a jumpsuit and shirts and bandanas and a few other items. So things like a 12 piece collection and all the aprons were made by us. The designs came from their design team, combined with our input and edits. And the way we did it was we brought the function and the core base. And then they brought the design elements that they wanted to kind of plug in from the world of Madewell, and those are the best collaborations. When you find somebody that does something that you don't do and vice versa.

Ellen Bennett:

So with Vans, it's like they make shoes we don't. We made aprons, they don't. With Madewell we make really high pro-grade, high function product that's really beautiful and lasts forever and they have great designs. So you bring those two together and you end up with a jumpsuit that's made out of a beautiful stretch denim that has a towel loop on the side for towels for when you're cooking. But its also snaps instead of buttons so you can get in and out of it because if you're going to go pee while you're cooking or whatever, you don't have time to sit there and unbutton 40 buttons. So just thinking about it from a function standpoint, it really ended up being a perfect collaboration.

Stephanie Postles:

Got it. And do they feel pretty similar or is it very one-off, like very different kinds of relationships because I'm even thinking about like how do you break up the sales or who gets what on the backend?

Ellen Bennett:

I think it's really important when people are doing collaborations to be very open at the beginning about what your end goal is. And for Madewell we really wanted to tap into their audience and they wanted to tap into ours. So it was like, "okay, we're going to go heavy into marketing." I also really wanted to make a jumpsuit. We had never done work wear in that capacity. And so they were like, "great, we'll make those products. You make the aprons, we'll hit that consumer from a home and pro angle, but with the same product" and it was a perfect split. So you work it out based on what everybody's needs are. And you kind of like lay out all your cards on the table. And if someone is a bigger company, typically the larger company will cover more of let's say the marketing costs.

Ellen Bennett:

So Madewell did a lot of the photo shoot for our collaboration or when we did our launch with Vans, we did a huge party with them. We had it at our 16,000 square foot factory in LA, but then they brought people from the strokes to perform. So it is-

Stephanie Postles:

Go Vans!

Ellen Bennett:

Go Vans! I mean, music is their world. So that is how it ends up being really effective. You have to both pull in and pitch in from both sides or else it's not really a collaboration, it's not really a partnership. You're inventing some false thing behind the scenes in marketing land for a good reason to talk to your audience, but everyone can smell through bullshit these days. Like if it isn't genuine, don't do it.

Stephanie Postles:

Yeah. Have you had any partnership fails? You don't have to say any of the names that have been like, oh, this didn't work out and here's maybe why or what I would avoid next time that this is why it didn't work out well.

Ellen Bennett:

Yeah. I love that you asked me that because truthfully at the early days of Hedley and Bennett, we did so many partnerships with so many people. And we said yes to everything because we were learning, we were exploring, we were trying things. And I found that a lot of times we had the kind of chutzpah and initiative to make it work and sometimes the other side didn't. And so we found that we were doing a lot of the work, a lot of times. Not in any of the partnerships I mentioned, but somebody would reach out and they'd say, "oh my gosh, we love your brand. We'd love to collaborate." And next thing you know, we're like throwing them a party and I'm like, "wait, why is our marketing department throwing a party for a brand that doesn't even have any of their people coming in to support or help."

Ellen Bennett:

So we kissed some frogs and learned what we needed to ask. And I don't fault anyone for it, but learning to say no is just as important to learn than to say yes. You need to be able to draw the line. But if our team hadn't done all those different events, I don't know that we would have learned that. So we learned it the hard way, but sometimes experience teaches you.

Stephanie Postles:

Yeah. I love that. And how long does a... I'm diving deep because I've not talked about partnerships a lot on the shows that's why I'm really going in.

Ellen Bennett:

Oh, yeah. Go for it.

Stephanie Postles:

When do you start seeing the ROI kind of trail off? At what point does the excitement die down and then you kind of are like, okay onto the next partnership or how long does it normally last?

Ellen Bennett:

Oh yeah. That's great. Let's say it depends on how much ramp up you make to the partnership or the collaboration, and then how quickly the product sells out. So I'll give you one example. We did a big print with a print collection with a company called Rifle Paper Company. I don't know if you know who that is, but if you Google that you will recognize the floral print.

Ellen Bennett:

So we did a print with them and we had a 40,000 person sign up waitlist for when the product launched. And that was done three weeks before the product launched. And so we were able to pull in all these people top of the funnel and bring them in and have them be excited about it. And we were hitting them with different emails, talking about the product and when it was going to land. And then once the product landed, it was pretty exciting for I'd say like about a month, it was that time. And that product sold very well and drove a lot of traffic for the entire period it was not sold out. So we had it up, I think for two and a half months. And this was three years ago.

Ellen Bennett:

Now everything feels so accelerated. It's like, you get a product up, it's cool. Then something happens. And then the United States implodes in some way. And then we're off to the races. Talk about that. And then something happens on Reddit and then it goes over there. So I don't know, I think the news cycle and everything else has sped up dramatically from 2017.

Ellen Bennett:

So, I'd say a good two-ish months is usually the range. And with them, we did lots of social media posts on both accounts. And so she was posting about it. We were posting about it and that helped just build the hype and momentum on it. And then once it sold out, it was gone and then people were bummed because they didn't get it. So when we brought it back, like almost a year later for a limited drop, it sold so fast. I think it was gone in a couple of weeks.

Stephanie Postles:

So I want to circle back a little bit to the B2B, to D2C transition and talk about, how did you guys think about your tech stack and your website, because when you're doing B2B orders, they're probably used to a different, sometimes archaic system of I'm used to logging in and making my purchase or talking to my guy at this location. How did you think about that switch? And did you really change the user interface and how customers were interacting or did you just let it go and see if they would adapt to your new D2C way of selling?

Ellen Bennett:

We have a pretty unique kind of split in our organization because you have one team managing two very, very different channels with very different customers. And when we were smaller, it was manageable and you could figure it out. But now that we've grown so much and that we are, we're now 80% direct to consumer, it's a dramatically different tech stack. It's a dramatically different backend.

Stephanie Postles:

80% because the pie just grew bigger. You still probably have a lot of those B2B ones the pie just got bigger. Yeah. Okay.

Ellen Bennett:

That's right. So it used to be 50/50, and now it's 80/20, but growth on all levels. To your point, the 80% D2C really surpassed the B2B. So we would blend everything, which was really painful. It was really hard because you had one customer service team servicing a chef who needed something for his opening and then you had Maria from Minnesota, calling in who needed a strap change on her apron. And you had two people helping both so that was a little confusing and convoluted, but we were too small to be able to do anything more and to resource it fully in a different way.

Ellen Bennett:

And now that the business has expanded, we actually broke out B2B and created its own P&L. It has its own P&L, it has its own team and its own sales force that... We've always had a separate salesforce, but it was blended into the rest of the company now it's fully broken out. And on the backend, we are automating it. So we're creating a portal where our B2B customers can go log on, get the discounts and have it be a little bit more easy and automated for them.

Stephanie Postles:

Yeah. So what portal are you finding success with? Because, I could see a lot of businesses wanting to go the other way. Like there's a ton of D2C right now. And B2B is sometimes where people also, they wish to be. So what backend, what tech are you using to make that easy from a log-in perspective versus consumer?

Ellen Bennett:

We have basically cloned our site and have done a wholesale site as a V1 and are working based off of that, seeing what works and what doesn't. I've also gone the polar opposite direction when we added new things on like last year, we built a brand new site from head to toe and everything was new and we tested nothing. And that was not great either. So we kind of, over-indexed on like, let's go really basic with the B2B portal and learn what is and isn't working and then build off of that with surveys and conversations with our B2B customers to learn what is working and what isn't.

Ellen Bennett:

Sometimes you don't have the resources. Sometimes you don't have the time. You have to find what works for your company. And perfect sometimes gets in the way of progress. So for B2B, we just said, let's do a portal. It'll be easier. It'll help our sales team. A lot of our leads are inbound because people just love our products, so they reach out to us and we have a way to have them just buy straight from inventory without talking to someone.

Stephanie Postles:

That's great. I always hate when it's like contact us and we'll let you know the pricing on things. I'm like, what if I just want to buy?

Ellen Bennett:

Exactly. And we got that feedback from our customers where they're like, "hey, I have a restaurant I'm working all day. I don't always have time, even though your staff is awesome. I don't have time to wait for Kate to get back to me. I need to just order this and be done with it." And so we thought, oh, okay, let's just do this online and take it from there. So that's how B2B has kind of evolved and began to stand on its own two feet next to D2C.

Stephanie Postles:

That's cool. And do you allow for customization within that platform.

Ellen Bennett:

Offline, online that would have cost us a $100,000 to build that feature and I'm just not sure that we're ready to make that commitment because we're still on V1, but we'll learn. We'll learn and see how much demand we get. We have an entire ERP system offline that you can do customization within Hedley and Bennett, but you do have to talk to a sales rep.

Stephanie Postles:

Yeah. That seems like a tricky place. I'm even thinking about companies like Swag.com which we've had on the show. And I've used them before and thinking about trying to even get this logo, I'm pointing to my hoodie that I'm wearing, like what's hard for... And there was many times back and forth and it was a [inaudible] they were like Steph that's like weirdly centered or that's like too big. It was actually helpful having someone tell me, that looks crappy let us help you.

Ellen Bennett:

Yeah. So it is definitely merging an old school industry that required a lot of hand holding to optimizing it in ways where people are willing to make a few concessions because they want to ease or they want the speed and they're like, "okay, fine. I won't talk to Kate, but I'll get to order it right now. Maybe I won't get embroidery, but I'll get the aprons by Monday." And so you just have those trade-offs and people are willing to make them.

Stephanie Postles:

Yep. All right. And the last thing I want to talk about before we happen to the lightning round is your facility in LA it's known, and it's kind of famous for its features. I think I read it had tree houses or zip lines. And after meeting you now, I'm actually not surprised at all, but tell me a little bit about how you thought about building your facility in LA and why you built it that way.

Ellen Bennett:

Yeah. So when we got the factory, about six years ago, it was an awful giant, ugly, ugly building. And my team thought she's lost it. What are we doing here in the middle of Vernon and next to downtown LA. So I thought, "no, guys, we're going to build a kitchen and we're going to add a zip line and there's going to be a slide and just tree houses, and it's going to be amazing and everything's going to be done here." None of that existed in the building, but I had a vision of how I wanted it to be.

Ellen Bennett:

And sure enough, we now have all of those pieces in here. And we teamed up with Samsung and built this gorgeous kitchen where we've hosted a lot of events. And it's been a really wild evolution of Hedley and Bennett going from this very chef oriented company to now this very home cook oriented business with so many more customers than just our restaurant customers. But at the heart of it, it's still a kitchen. And in our factory, the kitchen still brings our B2B and our D2C customers together.

Ellen Bennett:

Now we shoot videos for TikTok and social media and Instagram out of that kitchen. Yet we also used to host cookbook events for a chef that was launching a book. So kitchen is at our heart, no matter what we do and Hedley and Bennett land, whether it's B2B or D2C it will always be connected to that core which is empowering and inspiring people to cook.

Stephanie Postles:

That's awesome. Yeah. And such a good reminder too, of how to really get the most use of a space. So many people buy it for just one little small purpose and then when that purpose is gone, they're like, "oh, shoot, I shouldn't have maybe gotten that retail location," but for you, it's like you're using it for social, and video and events, which hopefully will come back soon. So yeah [inaudible].

Ellen Bennett:

Yeah, exactly. I think that's in Hedley and Bennett's DNA. We're all about multi-use, being resourceful and having everything have a dual function. Our aprons are not just for chefs they're also for home cooks, they are for potters and painters and designers can wear them to protect their clothes. So it's kind of for everyone, but built specifically with chefs in mind.

Stephanie Postles:

Awesome. All right, well, let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask a question and you have 30 seconds or less now to answer.

Ellen Bennett:

Okay.

Stephanie Postles:

All right. First one, what one thing will have the biggest impact on e-commerce in the next year?

Ellen Bennett:

Ooh. The one thing in e-commerce. It's such a cliche word, but it's the truth. I do believe that authenticity and brands that are real brands, not just pretty packaging and then you get a shitty product inside the pretty packaging. I believe those are the brands that will survive. There are people that care about what they're actually making and they believe in that product having longevity in life and more than just one click and then your customer is upset because they bamboozled. So, quality and authenticity in the products that you are making are always going to be important in e-com. Next year and the year after.

Stephanie Postles:

Yes. I love that. What's the nicest thing anyone's ever done for you?

Ellen Bennett:

Every person that has said yes and no to me has always... I believe all the yeses and nos that I've ever gotten have been the nicest thing that I've ever gotten because they've opened and shut different doors along the way that have forced me to be resourceful. That have forced me to experience hardship and have forced me to experience amazing feelings. And when you have a robust set of life experiences, you can tackle more things, never think about, oh my God, woe is me. This happened to me. It's like, hell yes, that you got through that. And that you now have that notch on your life belt of experience. And I believe you got to live life and feel life and go through the ups and the downs of it to come out on the other side with that much more context. And then you have that much more to pull from.

Stephanie Postles:

[inaudible]. That is a good one. That's one of my favorite answer so far. What's up next on your reading list?

Ellen Bennett:

My book.

Stephanie Postles:

Tell me about it.

Ellen Bennett:

I wrote a book. It took me two and a half years and it launches in April.

Stephanie Postles:

Interesting.

Ellen Bennett:

Yes, it launches with Penguin Random House and it's called "Dream First Details Later: How to Quit Overthinking and Make It Happen."

Stephanie Postles:

[inaudible].

Ellen Bennett:

That's high up on my reading list. Also, I'm obsessed with the entire series of Lencioni books.

Stephanie Postles:

Okay. I actually don't know what that is.

Ellen Bennett:

It's very nerdy, but it's like "The Five Dysfunctions of a Team," "Death by Meetings," "The Advantage."

Stephanie Postles:

Oh, got it.

Ellen Bennett:

They're all these story telling books that are about business and they're digestible and easy read. So I make my entire leadership team read all of them when they join.

Stephanie Postles:

That's good. And I can't wait to read your book that also sounds really good. What's your favorite e-commerce tool that you're experimenting with right now or you're having success with?

Ellen Bennett:

So it's not directly e-comm, but it really helps it. And it's called Dash Hudson. And it is a really incredible social media tool that drives a ton of data and analytics and helps show your team how much... We have a hard time figuring out how much traffic is being driven from social and where and how many purchases are coming from it. So this has given us a heavy dose of visibility. You're more empowered if you have more data and you can track things. So I really love Dash Hudson.

Stephanie Postles:

Cool. I have to check that one out. All right. Ellen, well, it's been a blast having you on, obviously you're super fun. Your company is amazing. Where can people find out more about you and Hedley and Bennett?

Ellen Bennett:

Yes. They have to go to our website, www.hedleyandbennett.com. And that's H-E-D-L-E-Y. And then our Instagram and our TikTok is also Hedley and Bennett. And my personal account is Ellen Marie Bennett. Our TikTok is highly amazing and packed with great videos about tips and tricks for the kitchen and how to just make you a bad-ass when you're cooking, whether you like cooking or not. So go follow all of them. And I have a pet pig that's 200 pounds.

Stephanie Postles:

That's enough of a reason [inaudible].

Ellen Bennett:

That one's on Ellen Marie Bennett. So just go join our wild world on the internet and say hi and say you heard me on this podcast. And thank you so much for having me, Stephanie. This was so much fun.

Stephanie Postles:

Yeah, I agree. We'll have to have you back and then maybe you'll bring your pet pig and we'll call it like a round table with your pet. That's great.

Ellen Bennett:

With Oliver.

Stephanie Postles:

Oliver, that's my son's name, how perfect [crosstalk].

Ellen Bennett:

Oh, my Gosh. Amazing.

Stephanie Postles:

All right. Thank you so much, Ellen.

Ellen Bennett:

Thank you.

Easing The Transition To DTC

info@mission.org (Mission) — Tue, 9 Mar 2021 08:00:00 +0000

Moving into the DTC space after operating only in retail is a tricky tightrope to walk. You have already-established partnerships that you don’t want to jeopardize and a consumer base that you don’t want to cannibalize. But you also want to bring innovation and new products to your loyal customers, and you want to build more personal relationships with them along the way. So how do you win in all areas? Or can you win in all these areas?

Andy Judd is the CMO at Yasso, Inc., and finding the answer to that question is currently at the top of his todos. . Yasso sells frozen yogurt bars, which side note, are the most delicious thing I have ever tasted. Yasso just recently began its journey into the world of DTC. Ultimately, Andy knows that building a profitable DTC arm of the business is one of the toughest challenges in the ecommerce industry today, especially when shipping frozen goods, but he’s done it before, and his tapping into all his knowledge he’s built up from prior roles at companies like ONE brands and Campbell's soup!

On this episode of Up Next in Commerce, Andy tells us what the move to DTC has been like so far, including the added challenges to logistics when it comes to shipping frozen novelties, what strategies he’s been using to ensure transparency with retail and third-party partners, and why he wants everyone listening to understand that ROAS is not the same thing as ROI. Enjoy this episode … and maybe also a Yasso bar!

Main Takeaways:

Deep Freeze: The logistics of shipping frozen foods are still being fully fleshed out. For certain products, such as frozen fruit, or even cartons of ice cream, you have a bit more leeway in temperature states and the risk of thawing and refreezing. With something like a frozen yogurt bar, you have absolutely no wiggle room, which means that there has to be multiple layers of pressure testing, route optimization, and quality control in order to ensure that customers are getting the product they expect instead of a puddle of froyo. It is only after you have optimized every step of that process that you can feel comfortable moving more to a DTC space.
ROAS Does Not Equal ROI: In ecommerce, ROAS is one of the metrics you hear about often. And while it’s important, it’s also critical to note that ROAS does not equate to ROI, because ROAS often does not account for incrementality. So be very careful when you are measuring your success and be sure to take into account all of the other activities that bring in revenue and returns.
Doubling Down: As Andy put it best, “I have a general principle of double and double and double and double until it breaks. You double until that ROAS really starts to decay at a rate, and then you know where your ceilings are.”
A Rising Tide Lifts All Boats: When you are selling DTC on a third-party platform, it is important to be upfront and transparent with your retail partners. Talking through who you’re targeting, how you’re pricing and why bringing incremental customers into the business helps all parties — more brand-loyal customers will buy across all platforms, including in retail — will make for a much more productive relationship.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey, everyone. Welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder and CEO at mission.org. Today on the show, we have Andy Judd, the Chief Marketing Officer at Yasso. Andy, welcome.

Andy:

Thank you, Stephanie. Great to be here and look forward to today's discussion.

Stephanie:

Excited to have you here. Like I said, I am getting hungry now thinking about this conversation. My stomach actually just rumbled. I don't know if anyone heard that, but that's how I feel about this conversation today. It's going to be a good one.

Andy:

Yeah, no, I'm excited. I think we've got a lot of exciting things happening on the business that I think we can offer some interesting perspective to the community.

Stephanie:

Cool. So, I saw that you have been in the CPG space for over a decade, starting all the way back at good old Campbell's Soup, which I'm like, that's a good history there of really knowing what you're talking about.

Andy:

Yeah. I've been extremely blessed and fortunate to work with some great companies along the road, those large blue chip companies like Campbell's, down to smaller emerging businesses like Yasso today. Each of them is definitely different culturally, business model, go to market, marketing approaches, not only from the size of the businesses, but also what's taken place over time. I appreciate you said one decade. In that lead up, it is a bit longer than that, but-

Stephanie:

I think I said over, but I didn't put numbers.

Andy:

Over, yes. I appreciate you not going all the way to, but yeah, I've been very blessed to work at great companies, great, amazing teams and leaders that have shaped a lot of my thinking. And now I'm happy to hopefully give back some of whatever wisdom I've collected back to your community too.

Stephanie:

Cool. Well, to start, I want to hear, from a very high level, how do you view the food and beverage industry today compared to maybe even just a couple years ago? How has it changed and how did that lead you to creating Yasso?

Andy:

Yeah. The speed of change is definitely picking up pace, and I'm not even talking about the realities of the past year, because that's a whole different kind of situational change, but the speed of change has definitely changed a lot. When I started my career, there was a very set number of customers, and we had a lot of customer consolidation happening, but then really, the marketing landscape started to evolve. Obviously, around 2008, 2010, Facebook came on and just rewrote the playbook dramatically. It took a while to internalize that, particularly in the food space, I think we were a little slower to adaptation.

Andy:

Analytically, I don't think we were quite ready for that moment. But once we kind of got our feet underneath us as a space, it really took off, and now it's how fast can you run to the newest platform to get the most efficiency before the system goes, particularly as an emerging brand, finding those places where I can flank, get the most bang for my limited dollar set versus some of the larger spenders is really important. And I think it's bred a new capability set for today's marketing leaders, that is constant evolution. While, yes, I run, to some varying degrees, the same purchase funnel, the activity that's happened within it, wildly different.

Andy:

I gave a speech to my alma mater and some marketing students and walked them through like, "When I started my career, here's what we did. We ran TV commercials and a newspaper based FSI. Waited 18 months to see if it worked, and then probably made a decision before we even got the results to do it again, and it's just wildly different from how we activate today."

Stephanie:

Yeah, that's great. So, you have all this experience, I'm guessing you're starting to see opportunities. What led you to Yasso and what did that process look like?

Andy:

Sure. So, I joined the Yasso team a little over a year ago and had known the founders for a bit, and known our CEO for even longer. And like many moments where they recognize the step change from kind of the what got you here won't get you there, brought in a new management team to implement a double down on the growth strategy. So, great product. I won't talk too much about the product because you are hungry, but it is a fantastic product. Super creamy, super delicious, great nutritional, clean label, it really does have all the components. But really, it was a bit landlocked on the East Coast, founded and formed in Boston. And this team is rapidly building out that distribution footprint, investing and building the brand.

Stephanie:

Yeah. Also, how can you go wrong when the founders are kindergarten friends? I mean, that sold me right away.

Andy:

Absolutely. Yeah, Drew and Amanda, I will say this, have been just fantastic to work with, both in the principles they've set as an organization from a company culture perspective, and how we value employees, and what benefits we give them, to how we make an impact in our community. We do have a 501(c)(3) nonprofit organization called Game On! Foundation. That's a big part of it. And then just this amazing product. As a marketer, I love that moment where it's like, "Build a brand. Here's this amazing foundation."

Stephanie:

Yep. So, what did your first 90 days look like? Of course, you always come in and kind of study things, see how things are working, but then what did your first 90 days look like? What did your playbook look like to start solving some problems there?

Andy:

Sure. It was a busy first 90 days. I had just come off of another transaction and was one of the last management members to join the organization. And so marketing, to some extent, needed to catch up. We were also moving the company from Boston to Boulder in that moment, and so there was definitely a team rebuild that happened there. So, first 90 days was establishment of strategy, getting the structure identified and a lot of recruiting, whilst simultaneously starting to build the components of activation to get us to ice cream season in 2020, which I'm sure we'll talk a little bit about, the sheer pivot that took place.

Andy:

So, strategy, put the playbook in place, get the key components, the critical components lined up, get the right team.

Stephanie:

Cool. So, you were just mentioning old school close tactics. What are you talking about [crosstalk] for anyone [crosstalk]?

Andy:

Yeah. Literally, couponing. I mean, I'm not kidding. Now, that evolution of incentive based activation has changed, right? The platform in which you may do that today looks a lot different than the platforms that we used to do that a while ago on. But yeah, I think there's reality to finding consumers and giving them incentives into trial and activating that personal truth in retail. It is not our largest investment, but it's an important one as we think through that funnel, particular in a category like this where taste is so critical that if I can get someone to push past that by giving them a little bit of an incentive and then know that my product is just lights out, is a great way to do it.

Stephanie:

Yeah. And are these coupons digital? Are they emailing coupons out? How are you doing that?

Andy:

Yeah. It's a number of different... So, we definitely operate that on owned basis through CRM. So, we definitely give incentives through kind of consumers that we've got into our ecosystem. That is, by far, the most valuable ones, which is keeping those people moving. Then there is outreach programs like Ibotta, that we've used, Shipt, Instacart, which also have, obviously, a shopping mechanism to them to drive trial. I'm sure we'll get into that at some detail as we talk about our omnichannel applications.

Andy:

And then some in-store placements, tried and true, IRCs, at shelf, to draw the consumer our way. This is definitely a very open trial based category where y'all want to try new things, and I'm looking for options, and if I can grab a millisecond of that scan at shelf by violating that with a save, definitely can do that. So yeah, it's definitely all components digitally, organic and owned, as well as in retail.

Stephanie:

So, let's dive into omnichannel, which you mentioned a little bit ago. Tell me a bit about how you guys had to potentially pivot post COVID, how you worked with your retail partners. I mean, I know that we're talking about how it can get kind of tricky too when you're, I guess, overly heavy on retail, and then all of a sudden, you're maybe trying to shift to DTC, and you don't want to make your retail partner sad. How did you guys think about that and explore that, especially over the past year?

Andy:

Sure. So, this brand was, I don't want to say 100% retail when I joined, but for this purposes, let's say it was 100% retail. Very limited investment, even on concierge based programs like Instacart, or even no investment on your platforms like Fresh, or walmart.com, it was very limited in that regard, and there was no DTC at that moment. Some of that is driven by frozen temperature state, right? I don't think... no third party platform has fully figured out that last mile in full temperature state. Retailers are definitely getting their closer and closer, Fresh is definitely pushing the boundaries there and building out an incredible footprint now. And I think COVID has exacerbated or built a lot of momentum to figuring out that for refrigerated and frozen temperature state products.

Andy:

We already had that in our plan. I think that all indicators of the consumer behavior was headed that way. COVID just made that evolution go faster. So, per my earlier point on change is just getting faster, COVID made this change faster. And so the dramatic shift that we saw, we knew we had to run pretty quickly. So, we were already strategically aligned to what that would look like, and for us that is four primary components of omnichannel. One is obviously DTC, and we'll talk about the intricacies there. Two is the concierge based programming and making sure that we're actively engaged there. Three is third party, and four is partnership with retail, primarily through online pickup and delivery.

Andy:

And so when we think about DTC, that's one component, but given that we're frozen temperature state, we really have to think broadly because of logistical challenges of working through shipping individual frozen Greek yogurt bars to a consumer's home and making sure that it gets there and it's not a puddle of Froyo is really challenging, particularly in an environment where FedEx is flushed with volume, logistics providers still haven't fully come to terms with the incremental volume in the system. So, it's definitely not without its operational, logistical challenges, but four components for us as we thought through that strategy, and we're diligently building each of them up, some of them simultaneously, and some of them we've kind of said, "Hey, we'll come to that one in a bit because these are more critical to success in the short term."

Stephanie:

Yeah. So, before we get more into the four pillars and the omnichannel piece, I do want to maybe jump into the operations aspect of how did you figure out this frozen shipping in a way that maybe others haven't so far?

Andy:

Yeah. So, let's start with our product DNA first. We make frozen novelties in a bar shape, so there's no forgiveness in that delivery, and we have to be pretty flawless against that, unlike, let's say, frozen fruit or even frozen ice cream pints, right? That can have a little bit of give, and the pint carton will hold its shape and kind of refreeze, no different than when you come home from the store. Novelties does not have that. If I have a little bit of give, that's not going to refreeze in what I believe our brand lives up to from a taste and sensorial experience.

Andy:

So, first and foremost was, we did a ton of pressure testing through a pretty in-depth thermal testing program. We vetted a number of different logistics partners, different packaging constructs, weights of dry ice, amounts of dry ice, what happens in delays, because we saw a lot of delays on ground shipping, hey, should we ship in air freight and taking discounts until the volume's figured out. We did a ton of pressure testing. And each of our products is also different. We make frozen yogurt bars, we also make frozen yogurt ice cream sandwiches. So, we've got a lot of different forms, even within our portfolio, that require a lot of diligence.

Andy:

So, a ton of diligence upfront, because at the end of the day, when we're asking consumers to buy our product, it is not a small price point for us to get over the hurdle, the cost of that seamless experience, it's not small. So, our goal is definitely very, very low fail rates through that. So, a lot of operational diligence upfront, a lot of understanding of routes and what geographies we do. We have a retail sales rep that was in Phoenix, and he got a lot of product in those early days, because we use that as our... that's the worst case scenario. If we can survive to Phoenix in August, I think we'll be okay. So, a lot of upfront thermal testing.

Andy:

And then engineering on the actual platform was also a good amount of diligence, and we're still evolving that as you always should be. Your selling platform, in my opinion, should be a living platform, for lack of a better word. It should never get complacent with the architecture that devils in the details on winning the SEM game, winning how consumers work through your sites, winning on how you keep them in the fold and get to repeat levels. We have a really high repeat level. That's really important to us. So yes, diligence upfront operationally, diligence on making sure the platform works right. And then once you start activating, the worst case scenario would be having someone have an experience that's anything less than superb.

Stephanie:

Cool. So, what does, from a high level, that back end look like? We settled on dry ice, or we didn't. We settled on a really good cooler. I'm thinking about this one cooler that shipped breast milk, it stayed frozen for four days for me. I was like, "Wow, this cooler is like a Yeti," but sadly, there was nothing you could do with it afterwards. So, what did you guys land on and what does that behind the scenes process look like now?

Andy:

Yeah. And also sustainability was an important factor for us and making sure that whatever format we were delivering in, we didn't want to deliver a format that would have a negative footprint on the earth either. So yeah, we had that extra variable, both the products, sustainability, surviving... like what happens if there's a day delay, right? If there's a day delay on an ambient product, if there's a day delay, most consumers don't get terribly upset by that. If there's a day to lay on a frozen Greek yogurt bar, that is a melted product, because that dry ice won't last forever.

Andy:

So, for us, it was a lot of diligence. We settled in on a really good package. We do use that insulated foam that put water on it, and it will dissolve. And so it was important for us to get that right. But we're talking about nuances of a half of an inch of that insulation, nuances of two to three incremental pounds of extra dry ice to ensure that. It really was fairly detailed, and I hope if our third party partner is listening or ever does listen to this, they know, one, I'm appreciative, and two, we definitely put it through the ringer on getting those details right.

Stephanie:

Yeah. Awesome. Let's move over to the four pillars, because I think that's a really tricky balance where you were talking about DTC, third party, retail, concierge, and I want to hear how you balance all four of those in a way that keeps everyone, including you guys, happy.

Andy:

Yeah. And we think about them a little bit about who we want activating through each of those. For us, incremental reach and incremental consumers into the Yasso franchise is really important. I mean, each of them plays a little bit of a different role in who we're targeting. Our DTC business is primarily pretty deep loyals because it's a pretty big price point, as well as our current baseline standard pack is an eight count. It takes up a little bit of room in your freezer too, so you got to love Yasso bars, which as we launch, we found that wasn't a problem. We definitely found some people that love Yasso bars and could take that volume on. So, that was a deep loyalty pool. It enabled us to get long... some of our tail skews and smart fan favorites available to people, get innovation in their hands early, those things.

Andy:

Concierge, to us, was a big win, particularly in 2020 when a lot of consumers ran, and we were able to pivot some of our investment and marketing dollars over there quickly. We had played around on the platform, and then back to your 90 days question, I had brought on someone on our team that was able to get in there, get into the self service side of things, had experience with that on other platforms, able to work in partnership with partners like Instacart and Shipt and really build that up, and we started running dollars to that. I have a general principle of double and double and double and double until it breaks, right? You double until that ROAS really starts to decay at a rate, and then you know where your ceilings are.

Andy:

And so for us, that was a really important one, particularly in the present temperature state. We knew consumer behavior is rapidly changing, we knew we could activate because we have the structure and the people in place to do so, and really win, particularly on buy it again. We knew that as new consumers were coming to that platform... I don't remember the stat I heard. It was something like they'd anticipated 30 million new households for the year of 2020, and they achieved that by April. And so it was definitely a double down on those types of platforms.

Andy:

And then we had had some initial discussions with Fresh, but it really was at a pretty good standstill. And so we knew we weren't operating on that platform relative to how we operate a retail, and brought in a new partner to help us [inaudible] on the platform, begin doing some more focused work on our side for advertising and in building out detail pages, etc, and really getting to a much better landing place there. And that has been a really nice win for us.

Andy:

And then the last pillar is that retail piece. And that one I think is evolving, because I think customers... there were definitely some customers that were ahead of that curve more in general merchandising, though, than anything, and definitely in some food categories, but definitely not in frozen and refrigerated food. And we've seen a definite increase from the prioritization of customers wanting to ensure that their platforms are in a good place. And we've seen a lot more requests for dollars flowing to help them build those platforms out. And so right now what we're trying to balance is, how do I see each of those platforms or pillars working together, and how do I spend the dollars accordingly? A lot of analytical rigor to that.

Andy:

But it's important to be really ready and flexible and flow those dollars to where you can get to the lowest CPCs, the highest ROAS, highest incrementality of households. We have third party analytic partner that helps us to look at ROIs, because ROAS does not mean ROI. If I could impart any wisdom to marketers out there that haven't lived that yet. ROAS doesn't take into account incrementality. So, it is a complement of different analytical approaches to help us flex those dollars across each of those pillars.

Stephanie:

Yep, I completely agree. So, are there any good lessons or learnings from going onto all those platforms, figuring it out, trying to pull them together eventually, are there any good lessons from that that other people can take away and hopefully avoid?

Andy:

Sure. I'll give you an example, not necessarily from my Yasso days, but some prior learnings that I had at a previous company. It is a gray space. As much as we're operating in these environments, whether it's DTC or third party platforms, retailers are also operating in these, and a lot of the questions we get is like, "Are you going to be sourcing volume from my retail in order to sell on these platforms directly?" And I think having those conversations with particularly important retailer partners upfront is important to help them understand how you're targeting, why it's good to bring net incremental people into the total business, and that helps all boats rise, how you're going to work with them through pricing strategy, in particular, how you're going to work through them with promotional and merchandising that doesn't create overlap.

Andy:

I have an example on Black Friday from a couple of years ago. There was a retail partner that was a very important retail partner, it was protein bars, and they operated heavily on Amazon, we operated heavily on Amazon. They were going to have their Amazon push for Black Friday, we were going to have our Amazon push for Black Friday. And we didn't get far enough ahead with them to decide who's doing what and how that may collide at the buy box. And thankfully, we decided to start our promotion early on Tuesday, because if we'd started one day later, that collision would have happened and no one would have been in the office to try and rectify it.

Andy:

And so what happened is they ran kind of a site-wide promotion across a number of the different brands that they sell as a broad retailer, and that discount stole the buy box and eroded a lot of your media metrics, we had obviously, some inventory challenges lined up in that. But thankfully, we were able to work through that and get it cleaned up. It had some implication with Google Shopping as well, so it was a multifaceted problem. It also gave us the opportunity to use that case as a way to talk through that with that retailer in the future, about lining up merchandising collectively, not independently. And that's not to suggest that we were comparing pricing, it was just more about talking through our approaches and what the implications on their platforms would be, our platforms, Amazon as a platform overall. I thought it led to a really collaborative place overall, but it is sticky, right? It's a bit of a frenemy reality, right? They are competing, but they're also your partners in retail.

Andy:

And so establishing guardrails and being transparent we found has been very helpful. Because, again, I operate from positive intent, we're all here to do the same thing, which is to drive growth and to give the consumer the right product that they want at the right time.

Stephanie:

Yeah. So, how do you go about talking to your retail partner to explain the incrementality piece, and this is good for me everyone type thing. How would you go about doing that in a way that makes sense to everyone?

Andy:

Yeah. Luckily, in the last few years, I've worked on some great brands that do have great stories about bringing in higher value consumers into the fold and figuring out ways to create total value that they may not get. And some of that is, "Hey, you don't have this portion of the portfolio on your catalog for whatever site you may be selling to, that's something that we can have...": I talked earlier about innovation as a way to get ahead. If a retailer doesn't opt into that innovation, that's okay. We definitely want you to sell our core business and operate there, but we want to give our most loyal consumers our innovation. It's also use of proof cases that we can then go back to the retailer and say, like, "Hey, this is a platform that's a little more vetted and has been cleared by our consumer," that, "hey, it's got proof here. This is an opportunity now for you to take that set to new consumers.

Andy:

It's also important for us to draw clean mapping to that consumer persona. Who's shopping online, and who shopping and retail, what they're looking for. And we've been very diligent about keeping that cleans. And here's who this is on my platform, here's who this is on third parties, here's who this is in your store. And collectively, that is a really nice store. And that's, I think, why we've had some success recently on outpaced growth relative to the marketplace.

Stephanie:

Yeah. I mean, it seems like it'd be really tricky keeping track of those consumers, seeing the online versus offline, and where are they originating from, and who's attributing to what sale? How do you go about managing all that data and keeping track of it, especially since you're on so many platforms?

Andy:

Yeah. I mentioned it a bit earlier, but we do have a partner that does regression based marketing, real-time marketing mix analyses for us, and we use them as a way to delineate the incrementality. That gives us a broad view to our mix, but that also helps us to understand which platforms to bet on, one from the other. I think we're at 18 different variables in that modeling, and some of those variables are literally platform level variables, and some of those are different types of campaign level variables. And so it is not without a lot of rigor, but building the model upfront... and I apologize if I'm using some of those key words, but take the diligence to really think about what the data sets are that are going to come at you and establish what they really tell you, back to my comment ROAS is not ROI. It doesn't mean it's not important, but it's not. And having a data system, and a dashboarding approach, and an operational cadence by which you analyze those and bringing all partners into that for transparency, it clears the air.

Andy:

I think I worked with partners before that have given us feedback that, "Nobody ever tells us this," right? "And our objectives are never your objectives. They're always different." Right? And so getting alignment upfront and clarity of data flow I think is one of those pieces, no different than the diligence we talked about earlier on frozen fulfillment. A lot of diligence upfront pays off down the road, and actually enables a ton of flexibility. It's just really painful. If I could offer any guidance to winning in omnichannel, it's details, focus on details, because the more detailed oriented you are, the better your system will be and the better you'll understand implications of changes.

Stephanie:

Yeah. I could see partnerships being lost because of you guys maybe coming in there and being like, "Here's the data points we need. Here's kind of how things work," which maybe needs to be lost if someone doesn't want to do that. But what are the most important data points that you asked from a partner that maybe they weren't comfortable sharing at one point, but now many are on board with doing that? What do you go in saying like, "This is the requirements, here's what we need," and which ones were they maybe more hesitant to share?

Andy:

Yeah. The propensity or the default position of the retailers is not necessarily to share, and that's not, I don't think, in the spirit of not being a partner, it's in the spirit of, obviously, their goal is to build a category, not necessarily an individual brand, and they're trying to optimize the total pool of brands to elevate their entire category. And so obviously, they don't want to do anything that could be detrimental to the totality of that category growth or detrimental to other brand partners that they may have. Some of that is opting in, some of that is dollars and cents.

Andy:

There are a number of retailers that have really great platforms for data, and some of that is opting in to those. We've made it a purpose to be data centric in how we approach, not just our retail business or our ecommerce business, all of it. And that may lead to a little bit of a higher non-working/working ratio for what it may be. But that makes us a lot more efficient with all the working dollars in that. And so some of it is dollars and cents and opting into their platforms.

Andy:

Some of it is having a clarity of that strategy that I mentioned earlier, like, "Here's who I serve by platform," and almost drawing a line that says, "Here's how I view the world. How do you view the world?" And soliciting that. But sometimes it means going in with a point of view. And they may not share that point of view, but at least they'll declare, "I don't share this point of view." And so opt in, have a point of view, and then you'll share results. Also, I think it has to be a two-way street. If I'm unwilling to tell them, "Here's how I'm operating in a direct model," why would I ask them to then tell me what it looks like in an online pickup or delivery model? So, I think there has to be some reciprocity that comes along to that. So, don't be scared to buy data and be more data centric, be clear about your point of view, and then you'll have a partnership, and be okay with some transparency that you otherwise may be not wanting to do in the first place.

Stephanie:

Yeah, I love that. So, let's talk a little bit about customer acquisition. How are you guys acquiring customers and what are your most successful channels right now, or what are some big bets that you're making in new platforms or maybe you're like, "We weren't on TikTok before, but now we are"? What are you exploring right now?

Andy:

Yeah. Yes is the answer always. Our team has got a great, I think, pulse for that and a great flexibility for adapting to that. And sometimes it's not just new platforms, sometimes it's new activations on current platforms. I think Reels taught us all a good lesson this year. Obviously, TikTok was a great piece of the puzzle over the last couple of years. So yeah, organically, yeah, definitely continuing to build that out. I think from a paid perspective on new platforms for us, I would say the retail environment is definitely pretty evolving.

Andy:

Other retailers are pushing their platforms more and bringing on new media partners. Target had their big push. I think it was two years ago when they made their media change. So, yeah, I think retail is an ever evolving world because they're recognizing different to sundry, the Amazons of the world that they're both, yes, retailer, but they're also media marketplace. And if I can get a little more down funnel awareness, consideration and purchase, they're operating in that consideration bucket, because I'm already actively involved in food buying behavior. And so I think that's a really interesting place to be playing.

Andy:

Yasso in particular at this life stage, though, we are moving significantly in that top of funnel place. And so it isn't necessarily new platforms, but it's new to us because we're reaching growth levels, which is such an exciting moment for any brand, where we have the opportunity to make investments in larger platforms. And so this past year, we did a lot of betting on awareness based platforms that otherwise we wouldn't have probably bet on. But streaming audio was a big win for us in this past year. I think COVID definitely helped consumers even more so get into that space.

Stephanie:

Like podcasts, you mean?

Andy:

Yeah, like podcasts. Well done. Yes, like podcasts, and even just music as well. But I think those platforms have become a bigger play, which for traditional food, probably hasn't been top box consideration for media plays, but have done really well for us. And then OTT, I think, continues to build. And so those are not necessarily new platforms, but new to us. And when we think about where we are in our life stage, that gives us opportunities to rethink our total funnel, and that's really exciting, right? So, it's, hey, we have the availability to anchor to spending dollars that are scalable on some of these platforms that we otherwise probably wouldn't have been able to afford originally, and now really evolving our down funnel work with retailers in a different way. So, it's evolving, but it's pretty exciting, actually.

Andy:

I think that is one of the benefits I've seen from this past year, is it's moved our industry forward and our retailer partners forward. Obviously, it's not to suggest that they were at zero state by any means, but I think it's definitely built a lot of momentum.

Stephanie:

Yep. And when you're thinking about creating good creatives for these new platforms that you're on, how do you go about making something that really differentiates you guys? I mean, it feels like your space is pretty competitive now. How do you stand out? How do you make ads and audio content that really sets you apart from everyone else?

Andy:

Yeah. Since we came on, we've thought diligently about the balance of internal external creative capabilities, where we need a differential expertise, where we need flexibility internally, and again, diligence upfront, right? So, that declaration of your brand, what it stands for, what it looks like, being very clear with that, so that as you disseminate across the internal and external content creators, whether that's influencer based or UGC, or whatever it is, you know this is it and this is what it looks like so that your brand identity is well done.

Andy:

And then I think voice is an interesting place, and voice in two ways. One, is having perspective. I think brands that are able to separate themselves, to your point on the competitive environment, have a really clear voice and perspective on things, and they're willing to take a stand and say, "Here's what we believe." Because consumers, from an engagement perspective, are much more likely to go there. It could bring polarization components to it, definitely, that's a possibility, but it won't bring engagement, right? So, if you don't have voice, if you don't have a perspective, you won't have engagement. So, it's kind of one of those. So, perspective is one.

Andy:

And then, for us in particular, in our category, I think having a definitive sense of humor. It's a joyful snacking experience, right? I typically don't see a lot of people eating our food without the intention of elevating their mood.

Stephanie:

Yeah. You can't eat it with a sad face.

Andy:

No. I mean, you can. I mean, there's the old adage of the breakup with the ice cream-

Stephanie:

Okay. That's more ice cream.

Andy:

... but you're doing it to elevate yourself, right? So, most people don't enter that space without the intention of enjoying the experience. And so I think it's important for us to bring that levity and humor to our voice. So, having perspective, having a good sense of humor that's definitive and unique, and having clear sense of art direction is really important. And the last piece I would just say is contextual, right? So, not all creative is the same across. Our organic content team I think does a great job with, "Here's what works in Twitter, and here's what works in TikTok, and here's what works on stories, versus reels, versus feed," and bringing that to the game as well.

Stephanie:

Yeah, I agree based on some of the things I've seen. All right, let's move over to the Lightning Round. Lightning Round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Andy?

Andy:

Yes, I'm ready.

Stephanie:

I wish my knuckles cracked so I could do it.

Andy:

I can't do that either, but I'm ready.

Stephanie:

We tried. All right.

Andy:

Yes.

Stephanie:

First, what one thing will have the biggest impact on ecommerce in the next year?

Andy:

What one thing will have the biggest impact on ecommerce? I would say, for me, last mile. I think the last mile is going to take a big step forward this next year. I think a lot of companies got caught flat footed on it. They spent the better part of last year figuring it out, and I think you're going to see more retail platforms figuring out last mile and betting big on it.

Stephanie:

Yeah, I agree. That's a good one. What's the nicest thing anyone's ever done for you?

Andy:

I love the two words, to of my favorite words. Thank you. So, I will always take a thank you and I always try and give them just because everybody's working really hard right now, personally and professionally, and I just think the smallest thing you can do is just to say thank you. So, thank you for having me, Stephanie.

Stephanie:

Okay. Thank you for coming on the show, Andy. What one thing do you not understand today that you wish you did?

Andy:

What one thing do I not understand today that I wish I did? There's so many things that I don't understand. I think the biggest one I had a better feel for honestly was how to get ahead on new organic platforms. That's definitely one of the tougher ones. I think we've built a good flexible ability to adapt to evolutions within platforms, but which ones to bet on just because there's so many, I think that's one I wish I had a better gut feel for it, to be able to jump there faster. As an emerging brand, I feel like that's one of our core competencies, is the flank approach and not getting trapped in the big game. And I wish I had a better feel for emerging organic platforms.

Stephanie:

Yeah, that does seem tricky to stay on top of, to be the first one on there and to be the one that can organically grow, because it does always say there's a lot arbitrage to be had on platforms in the beginning, especially when they're trying to figure out their maybe advertising programs. I know TikTok for a while there, you can get really good maybe ROIs because the platform was so new, they're figuring out their program. Maybe that's gone now, but that's a good one.

Andy:

And that's the exact point, is that it does happen quickly too. And I have seen brands be very successful in getting there first and grabbing that attention.

Stephanie:

Yeah. What's up next on your reading list?

Andy:

Right now, what is next on my... I'm looking over at my books. It is... and I'll show it to you, here. It is Hello Darkness, My Old Friend, by Sandy Greenberg. This is a book recommended by my father-in-law about the story of Art Garfunkel's college friend who went blind in college and his journey. He's a lawyer, and it's just an incredible story. So, that is next on my reading list.

Stephanie:

Wow. I'm writing that down. So, what was it? Hello...

Andy:

Hello Darkness, My Old Friend by Sanford Greenberg, or Sandy Greenberg.

Stephanie:

All right. I'll get it [crosstalk].

Andy:

Foreword by Ruth Bader Ginsburg, by the way.

Stephanie:

Oh, sweet. Okay, now, I'm definitely checking it out.

Andy:

Yes.

Stephanie:

All right. And then the last one. What ecommerce tool or piece of tech are you experimenting or most bullish on right now?

Andy:

Yeah. I'm going to go back to our logistics because I'm bullish that there's going to be a lot of progress on sustainable packaging over the next coming years, and as I mentioned earlier, having sustainable frozen packaging is just fantastic. It makes us feel way better about continuing to grow in this space. But I think there's going to be a lot of technology in the packaging constructs. There's a ton of waste in this space. I think brands are getting way more savvy around designing their first rather than trying to re-architect the other retail packs and then doing the best they can. So, I'm excited to see what comes in kind of more the the operational side as much as anything. That's a personal passion for me, but I'm excited to see how that continues to evolve.

Stephanie:

Awesome. That's a good one. All right, Andy. Well, thank you for coming on our show and sharing your insights. Where can people learn more about you and Yasso?

Andy:

Yeah. So, you can find us at yasso.com, for sure. Instagram @Yasso, are the best places, and you can find me on LinkedIn, for sure.

Stephanie:

Amazing. Thanks so much for joining us.

Andy:

Absolutely. Thank you, Stephanie.

Democratizing Investments in CPG Companies

info@mission.org (Mission) — Thu, 4 Mar 2021 08:00:00 +0000

The world is moving toward being decentralized in every area from the internet to big business. What that means is that the way we do things will change, and in some cases, those things are already vastly different than the norm we all have grown accustomed to.

Funding and investments are one aspect of the business world that for a long time have operated in silos. But the tide is shifting, and David Koifman is helping to democratize the world of investment through his work at Kickfurther.

Kickfurther is an investment platform that uses the power of crowdfunding to help CPG companies fund their inventory and production runs. Most of the deals on Kickfurther are fully funded and closed within minutes, which proves there is an appetite for this kind of investment in the general market. On this episode of Up Next in Commerce, David explains the model and its benefits to both businesses and investors, and he explains how crowdfunding will continue to make an impact on ecommerce companies in the decentralized future.

Main Takeaways:

Democratizing Investment: For too long, companies have been at the mercy of financial institutions to help fund early production runs or other operational costs. And while that solution works for some, we think that new solutions are still needed. Opening up investment opportunities to the general public is a peek into where the world of funding is heading
Keep Proving Yourself: When a company gets a bank loan and pays it off, the business is seen as more successful and its credit rises. A similar thing happens when a company uses crowdfunding for inventory: by delivering the inventory the crowd has purchased and then opening up a new round of funding, a business is building credibility with a consumer and broad investor audience that it otherwise would not have been able to reach.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome back to Up Next in Commerce. This is Stephanie Postles. And today we're talking to David Koifman, the head of growth at Kickfurther. David, welcome to the show.

David:

Hey Stephanie. Great to be on the show.

Stephanie:

I'm glad to have you. So I was looking through your background and I was hoping we could start there because I saw that you've been in sales and partnerships and business development, and it seems like you've had a wide ranging career. So I wanted to hear a little bit about what you did before Kickfurther, and what brought you here.

David:

Before Kickfurther? I was in marketing right out of college. And then I went into the world of startups in financial technology. I began as a sales rep and grew within a small organization to a much larger organization, led the team, and basically built out sales account management partnerships. And then we were getting to a stage of growth where I wasn't feeling the excitement that I initially felt and joined the team at Kickfurther to do it all over again. So I've been here three and a half years. It's been awesome. We've grown tremendously, and I'm very excited about the next few years to see where it will go.

Stephanie:

Awesome. So you've always, always had the startup bug, where you're looking for that crazy hectic environment, fast growth.

David:

Yeah. It's like I see myself as a sales guy who doesn't like just selling. What I like is building the sales process, building the team, understanding the customer. So a little bit more beyond just knowing individual customers and building a book of business.

Stephanie:

Yep. Got it. So tell me a bit about what Kickfurther does.

David:

So Kickfurther solves a unique problem that every consumer goods business faces in their early stages of growth. You'll see a lot of companies are funding on platforms like Kickstarter, Indiegogo. These are crowdfunding platforms where businesses raise money to fund their first production run. Production run is when a business is producing inventory. Inventory is the product that they sell. So as that business completes their crowdfunding campaign or determines that they have product market fit, they will need to come back and order more product. Sometimes, they're buying that product from a supplier, maybe a manufacturer in China or here in the U.S., somebody that produces a finished product, and then they receive it in their warehouse and they sell through it. Sometimes they're buying a bunch of raw materials and making a product themselves. Usually that's the case in food or some health and beauty applications.

David:

But the bottom line is that costs a lot of money, and the faster the business grows, the more they have to invest into inventory upfront. You have to pay for that inventory, it takes months to produce, and then you get it into a warehouse and then you start selling it to customers. And then your customers start paying you. So there could be a long amount of time from when you need to outlay that cash to produce the inventory until you're able to recoup that revenue and put it into the next production run. So as businesses grow, they encounter this cash flow pinch, and Kickfurther solves that pinch. We have developed a marketplace on kickfurther.com, where we will vet companies and structure deals. And then a community of users will come to those deals and participate in purchasing the inventory for that business. The business will then produce the inventory, sell it, and pay back Kickfurther and the users who participated in the deal; we'll make some money and get to do it all over again.

Stephanie:

Yeah. Very cool. It reminded me of, I saw quite a few real estate investment platforms like this too, where you get the fund, the next three or whatever it may be. So it seems like they're popping up in different ways to have a Kickstarter approach, but also getting people in the market who have the funds to be able to fund this inventory or investments or whatever it may be. So is that the main way that Kickfurther is different, where it's sourcing investment from the community instead of traditional lenders or actual investors?

David:

Yeah. So I mean, what we're doing is using the power of crowds rather than financial institutions. There's a lot of solutions out there that take money. They borrow money from banks and other financial institutions, and then present it to businesses and take a cut. And what we're doing is creating that opportunity for any individual on the internet, somebody who has money sitting in their bank account, and they want to use that money to make money by participating in a purchase of inventory for a consumer goods business. And so what we do is, it's not a loan. It's not an investment, it's actually a consignment agreement. So what we're doing is purchasing inventory for a business and consigning it to them to sell on our behalf. And as the business sells that inventory, then that triggers the consignment, and then we invoice them for it and they buy it back plus their cost of funding.

Stephanie:

Got it. Okay. So how do you make sure that you're bringing on companies onto your platform that won't make you nervous, where it's like, are you actually going to sell all this inventory? Because I'm not trying to cover that cost.

David:

Yeah. Well, there's a pretty thorough diligence process that we go through for every business that goes on the platform. We evaluate everything from their revenues to their supply chain, to how they distribute that product. And it's all verified through documentation. So it's not like anybody can come to us and say, Hey, we need money," and then just go up on the platform. There's a diligence process, just like there would be going to a bank or any other financial institution. I would say our uniqueness is we look at supply chain and distribution, and we assess risk in a very specific way. It's different from a bank. So some of our customers, everybody wants to go to a bank. Bank money is the cheapest. You want to go to a bank and get a line of credit and fund your business that way.

David:

However, if you're a small business, whether you're a restaurant or a clothing store, the bank looks at you the same. They say, how long have you been in business? Are you profitable? How much have you sold? Whereas we're looking at a very specific sector of small businesses that are consumer goods, businesses with supply chains. And we understand the intricacies of that supply chain and then how they get that product to their warehouse, get that product from the warehouse to the customers, and collect that money through their distribution channels. And so we use that information to determine who has access to capital on Kickfurther.

Stephanie:

Got it. Yeah, what's cool is that you guys are acting as like the trusted source, so that the community doesn't have to do as much due diligence, or I don't know if they do any at all, but you're acting as like the mediator, to be like, "We've done all the research. We know this company, and it's for the most part trustworthy," and then people can come in and fund that based off of your research and due diligence.

David:

We do verify all the information that's presented about the company. The individuals still do decide which deals they participate in. And that's based on what they read in the public profile. Some of them will go investigate more. Some of them will actually ask questions on the platform. So you have the ability as a participant to ask the owner or CEO questions before you participate, or during the deal, about distribution or how they're making products, or what if they're worried about competition? Any topic is welcome. There's a lot of additional diligence that an individual can conduct before they make the decision to participate.

Stephanie:

Cool. And is there a risk rating of, okay, this company is more of a startup one, this is going to be their first time raising money here; we're going to give them a risk rating of this? so maybe you have a higher payoff because of that if they end up selling all the inventory, or how do you guys think about the risk-based approach when it comes to getting investment?

David:

It's not as simple as just boiling it down to a one to 10 scale or something like that. But there's a lot of categories which each one of the customers that we fund will be shown in. And so you can look at how many years in business, what their revenue range is, how many different wholesale buyers they have, how many times they've gone through the supply chain and produced with their supplier. So there's a number of different elements that, that are categorized in terms of risk.

Stephanie:

Got it, cool. And what is the average return for someone? If I were to go in there and invest right now in a deal, is there an average range of what you make over one year or that a longer time horizon?

David:

So the deals range in duration from two to 10 months. So the way we compare deals is on a profit per month basis, and businesses will offer anywhere from one to two percent per month. And so you can annualize that in a way where, if you participate in a deal and then that money comes back to you, then you can redeploy it into another deal. And if you continue doing that, let's say 1.5% a month will translate to about 18% per year.

Stephanie:

Got it, cool. So what kind of struggles do you see ecommerce brands having right now when it comes to ... Obviously not having money to fund inventory is the high level problem, but maybe what kind of sticky situations do you see brands getting in by either waiting too long to get funding or not even thinking about it. What are some stories that you have around the whole inventory funding?

David:

Yeah, I think the biggest thing to do is to be proactive and understand what solutions are out there and how to use them before that need comes around. Because being desperate is the worst time to be looking. And if you've run out of inventory as a business owner, you're missing out on opportunities to sell. So like you could have a really successful Q4, and then you get to Q1 and people still want to buy your stuff, but you're all out. And then you placed an order with your supplier, and the supplier takes two months to produce. And then maybe you're in a position where you have to air freight instead of going on the water and you have to pay a lot more money to get it there faster. So there's all sorts of obstacles that come into play. And that's ecommerce.

David:

A lot of the businesses that we work with are multi-channel sales. So they're selling ecommerce and then they're selling to target or Best Buy or REI. And those companies will place orders, if you don't deliver those orders when you say you will, then you're probably going to lose that opportunity or at least jeopardize it in the future. So it's important to make sure that you have the inventory ready when you're going to need it. And you also don't want to have way too much. So if you buy a lot, and then you don't sell at the rate that you expected, you have a lot of cash sitting in the form of inventory in your warehouse. Sometimes it's going to go bad, if it's a crude product or it's just cash that you want to spend on advertising to sell the product, but you can't because you don't have it.

Stephanie:

Cool. So if I'm a new brand and I'm looking to crowdfund my inventory, what are some best practices that attract the investors in the crowd? What kind of things do you see connecting with people? How would I write up a good post right now to attract funding for someone to help with my inventory?

David:

The most important things are that you've done it before. So we don't work with businesses that are doing their first production run. We did in our very early days, and, as you can imagine, it's much higher risk. So we only work with businesses that have at least $150,000 in sales. And once they've demonstrated that, it's good to talk about how you work with your suppliers, what sort of things you do to ensure that you're going to receive the product that you want to receive within the timeframe that you plan on receiving it. So being conservative with time estimates, making sure that you have testing in place so that once your supplier says the product is ready, that somebody goes in and looks at it and you don't get a bunch of broken stuff.

David:

And then once it arrives, it's important that you have reliable distribution. People want to see good reviews. People want to see lots of reviews. And I would say, if there's somebody who's selling to a wholesale customer and they just have one customer who is placing large orders, that's pretty high risk. Because if that customer decides they don't want to buy anymore, who are they going to sell that product to? So those are the kinds of things that users on Kickfurther are taking a look at, reading through the profile, to decide if they're going to participate. One thing I will say that we haven't touched on is how fast these deals fund. So it's good for us at this point. It means that there's an imbalance in the marketplace in our favor. So the deal flow that we put up gets funded oftentimes in minutes.

Stephanie:

Yeah, I know. I noticed that, because I'm like, "Hmm, maybe let's see if I should investigate these deals." And I think it looked like everything was sold out, or it was all met to the limit. At least the two I was looking at. And it seemed like it happened really quick, where I'm like, "Hmm, this is competitive."

David:

Yeah. It's super competitive. So we have the ability to scale our deal flow pretty substantially without having a concern for deals funding fast enough. And as a user, if you're thinking about participating, you're going to get emails, you got to act on it fast. And so we put deals up. They have about 24 hours before they launch. And they always launch at 5:00 PM Eastern Standard Time. And if that, there's hundreds of people that are clicking, trying to get into deals like within a minute or two of 5:00 PM, when they usually fill up.

Stephanie:

Wild. I think you need more deals then for people to get in on.

David:

Yep. That's my job. I've been working hard on it. So we we've grown quite a bit. We have aggressive growth goals for 2021, and so far we're on track. It's early, but it's an exciting time to be at Kickfurther.

Stephanie:

That's great. So what brands are you trying to get on the platform right now? Who are you trying to convince to get on there?

David:

There's a lot of repeat customers, and we have really good retention. We average over four deals per customer, but they're all across the board. We're pretty product agnostic. We serve anybody who either buys or makes physical goods and then sells them with the exception of regulated things like alcohol, tobacco, firearms, THC, anything that's temperature controlled or perishable. Because of the consignment agreement nature of the contract, the inventory is our collateral in these deals. So we don't want it to go bad. And we want to make sure that it is available to anybody who participated in the consignment, they have to be able to purchase it.

Stephanie:

Yep. Oh, got it. So if the inventory doesn't sell out, you guys essentially have it in a warehouse, and me as an investor could be like, "I want one of those t-shirts then." Is that how to think about it?

David:

Yes, that is a way to think about it. So if the business is unable to sell the inventory, and they're unable to pay back Kickfurther and their users for the cost of it, then Kickfurther, based on our contract, will require a delivery of that inventory to us, at which point we'll attempt to sell it, and all the proceeds of that resale goes to the participants in that agreement.

Stephanie:

Have you had to do that yet?

David:

We have had to do that. We've been around for seven years. So it's happened, but these days it's very infrequent, and that's why these deals fund so fast as people who are participating on Kickfurther have great returns and they tell their friends about it and they the deals. So the performance, overall, is strong.

Stephanie:

Yeah, got it. So when I'm thinking about, as a business myself, getting credit and working with banks, you're building up your business credit worthiness. When you get traditional loans, I know we had to take on a couple of last year and it does help being like, "Oh yeah, we took on this size loan, we paid it off." How do you view crowdfunding in that kind of sense? Is it building up a business's credit worthiness or is it so siloed still at this point that it doesn't actually build up the financial view of the business

David:

In some ways, it does, and in some ways it doesn't. It isn't considered debt to them. So it doesn't operate the same as taking out a loan and paying it back. But there's a lot of transactions that still occur that show the business is selling and making money. So their business credit will improve as a result of that. But yeah, it's kind of a mixed situation.

Stephanie:

Yeah, yeah. That seems tricky. Because it seems like a really good avenue to not only help the businesses, but then also bring in a lot more players. It seems like it's much more decentralized, which is great. The whole world's moving in that way, but if you can't really use it, be like, "Oh, look at these three different loans I have right now, the market funded them." I feel like the world needs to move to that place, the more of that crowdfunding and the decentralized approach is coming to the forefront.

David:

Well, the world is moving in that direction, but what's really cool is Kickfurther moves in that direction with the clients themselves. So as we establish a relationship with a business and they come back for repeat deals, we increase their limits substantially. And they have access to lower rates. Basically, they're earning credibility with this community. So let's say they offer one and a half percent per month on their first deal and they complete on time, and then they come back, they can offer less. It's really in the hands of the business owner what they want to offer, and the community, the marketplace, will decided if that business has earned that rate and are able to fund it at a lower cost. So as a customer at Kickfurther, as your revenues grow, you'll be able to take on more funding with Kickfurther, buy more inventory, and do it at a lower cost.

Stephanie:

Got it, okay. So you're building up that credit worthiness, just in a different hub, but you're doing that by just performing well and, yeah, that makes more sense.

David:

We will work with businesses who are starting at 150,000 in annual sales, and all the way up to 30 million. So there's quite a range of growth in service by Kickfurther. There's businesses that, once they reach a certain stage, either they're not accelerating as much as they used to and they have the cash flows to fund their own inventory and continue producing, or there's other businesses that have been long and around long enough where they are now exciting to banks and other financial institutions that have very low cost lending.

Stephanie:

Yep. Is there any guidance or any point where you're like, "Oh, you should probably just reinvest revenue or profits instead of getting a loan." Do you ever give guidance on that? Because I could see a lot of businesses always being like, "Oh, at such a low rate, why don't I get loans?" But then quite a few businesses have a lot of cash on their balance sheet too, and they don't know how to fully deploy it, but they're just so used to getting low interest loans. Is there any point where you've actually advised a company like, "You guys are good. Maybe you should reinvest profits." Or do you even see it from that angle?

David:

I don't think anybody's coming to us if they don't want additional capital. And I am always very transparent with everybody, and [inaudible] make sure you know, what your options are. We don't make money off convincing you to do one deal. We want that long-term engagement [inaudible] coming back. But I think the reason people come to Kickfurther is they have an opportunity with a buyer, or sales are growing so fast and in a channel where they want to launch a new product, they just don't have the cash to be able to do that. And that's why they're looking for funding solutions. And maybe they go to their equity investor and they say, "Hey, I need some additional capital to be able to take advantage of this opportunity." And the VC says, "You know what, why don't you seek some non-dilutive capital for that? That's a much better use of, why give up five or 10% of your ownership just so you can produce the next run when you're going to have to do another one and another one and another one after that?"

Stephanie:

Yep, yeah. That makes sense. So, since you're deep in the crowdfunding space, I'm sure you just see opportunities all around. So much stuff could be crowd crowdfunded. Where do you see that world headed? What kind of new opportunities do you see popping up in that space? Or what do you think is missing right now, where crowd funding could be meeting a need?

David:

I think there's a lot of money and power in crowds. And there's the ability to cut out middlemen and big entities that have been around for a long time and empower individuals to help these business owners grow. It's also not just the money that's coming from them. Why are people deciding to participate in these deals? A lot of them believe that they have an advantage and they have the knowledge in the space. So maybe they want to help the business owner. I've had plenty of users come to me and say, "Hey, I actually work in this space. And I have a couple of distribution opportunities that I'd like to connect with your client about." And I'll make a direct introduction, and all of a sudden they acquire a new sales channel. Or somebody who's got a lot of money and they want to do a side deal. Yeah, I am looking for equity investors, let me connect these two people.

David:

So those kinds of things happen rather frequently. And that's not going to happen when you're working with a sales rep at a bank. Because everything's coming from the bank's bank account. And actually the money that the bank is using is just coming from account holders and their deposits. So if you're storing money in a bank, the bank is using that money to lend to businesses and whoever else. So we're cutting that out of the mix. And I think it's good for everybody involved.

Stephanie:

Yeah, I think it's a good reminder too, about diversifying investments and why finding opportunities. Yeah, you don't want to just keep your money in a bank and let inflation just wither it away to nothing. So, yeah. It's cool to hear about opportunities like this that are very different, but will definitely help diversify your portfolio.

David:

Yeah. And it's really fun, from our standpoint, to work with all these young business owners. I mean like the business is young, not the individuals per se, but some of them just started a few months ago and they've had some real success. Some of them, it's a family business that's been around for a couple of generations, and all of a sudden they're discovering that ecommerce is a way to skyrocket the business. They have a really good product; they just haven't put it in front of the right audience. And they're figuring out how to make this happen financially, and we're there to help them. And it's just really great to be side by side with them as a partner and see that growth.

Stephanie:

Yep. Yeah. It seems like there's also could be a lot of international opportunities. I know that's a lot more risky once you start going that route and finding people who are doing much smaller scale ventures and being able to help back that, then turn into a bigger thing. But I have read a few stories of finding people doing amazing things in other countries, but they just don't have any kind of funding. Or they can't buy inventory for even 10 things to sell. And yeah, it seems like there's a lot of opportunity around the world, but of course it'd be much more risky trying to vet those projects and companies.

David:

It is definitely a challenge. It's something that we're considering doing down the road. You probably start with Canada and some EU companies, but there's different regulations in different countries. And also, if we get into a bad situation with a client, we have to pursue them legally. So working in a foreign legal system is very costly, and we try to help businesses out, and so our margins are pretty slim. So being able to afford that kind of activity is probably a ways down the road for us.

Stephanie:

Yeah. So what are you guys looking forward to for the next, maybe, two to three years? What are you planning for? You said you were going to be growing really quickly this year. What kind of things are you putting in place right now and where do you want to be in the next couple of years with Kickfurther?

David:

I'd say we want to be a household name for inventory funding. A lot of people are starting their own businesses. And we want to create an opportunity for them to grow at the rate that they're able to grow and have access to capital. And so our goal is to put our name out there in a way where it becomes recognizable to all business owners who are in the right space for us.

Stephanie:

Yep. Very cool. Yeah, Amazon be a good space, but then sometimes those one-off products that are being sourced and sold on there. So maybe that's not the best space. I'm not sure

David:

Those people are business owners and growing too. So if you have one product that's selling really well, and that's what you want to focus on, sure, that's great.

Stephanie:

Cool. All right. Well, let's shift over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, David?

David:

I'm ready.

Stephanie:

All right. What one thing will have the biggest impact on ecommerce in the next year?

David:

Probably the state of the world. So the ability that people have to shop and travel and continue to live their lives the way they did before lockdowns and quarantine.

Stephanie:

Yep. All right, cool. If you had a podcast, what would it be about, and who would your first guest be?

David:

I don't think I would have a podcast.

Stephanie:

What would you have then, a clubhouse? What would you have then?

David:

A clubhouse. I think that, honestly, I was a little bit foreign to this whole world of supply chain and inventory finance when it came to Kickfurther, and I've discovered a passion for helping these business owners. So I think the clubhouse that I would have would be one where business owners get together and talk about different solutions that help their business grow, and what vendors they use and what are best practices, just an exchange of information across business owners and vendors.

Stephanie:

I like that, because yeah, I think even thinking about, "What manufacturer should I use? And how do I even source those people?" Still always feels like a black box and it's referrals. Or you have to know someone and that'd be a good one.

David:

We make quite an effort to make those resources available to our customers. So, as we go through our diligence process, we cover a lot of topics, and oftentimes customers will identify pain points, and we will say, "If you're interested in these, this is a partner of ours, or we've got a few different options or people you can talk to, to learn more about the solutions in this space."

Stephanie:

Yep. Cool. What's up next on your reading list?

David:

Can't Hurt Me by David Goggins.

Stephanie:

Okay. Nice. Where are you traveling to next when it's easier to travel again?

David:

In two weeks, I'm traveling to Salt Lake City to go skiing, but that's a drive for me.

Stephanie:

Yeah.

David:

Big skier. And whenever the snow comes, I'm out there.

Stephanie:

I love that. All right. And then the last one, what is your favorite piece of tech that you're using right now? It can be personally or with the business.

David:

Don't hate me, but it's my iPhone 12 Pro.

Stephanie:

What's to hate? I have the same thing. It's my favorite. It has the best camera

David:

I bought it for the camera, but it's really fast. It's a computer in my pocket that does pretty much everything my actual computer does.

Stephanie:

Yeah.

David:

Super valuable piece of tech.

Stephanie:

Yep. I agree. All right, David, thanks so much for joining the show. Where can people find out more about you and Kickfurther?

David:

Kickfurther.com is the best place. You can find me on LinkedIn, David Koifman, and I look forward to connecting with anybody who's interested. Also, if you're a business owner listening and you're interested in funding with us, you can go to our website, fill out an application, or you can just email me david@kickfurther.com.

Stephanie:

Yeah.

David:

Thanks so much, Stephanie.

Stephanie:

Cool.

David:

It's good to be on here.

Stephanie:

Yeah, thanks, David. All right. See you.

David:

Take care.

Building A Relationship with Customers When You Can’t Access Them Directly

info@mission.org (Mission) — Tue, 2 Mar 2021 08:00:00 +0000

What happens when you can’t own the direct relationship with your customer? In the ecommerce world, you would think that’s pretty rare, but companies in big and highly-regulated industries deal with this problem daily. Anheuser-Busch is one of those companies and its team has had to be innovative in the ways they gather insights and create relationships with customers. Arabella Watters leads Category Development and Insights for ecommerce at Anheuser-Busch, and she is helping bring creative solutions to understand exactly who AB’s customers are, how they shop, and what they’ll want in the future.

On this episode of Up Next in Commerce, Arabella dives into the roundabout ways that AB has had to gather data, and she explains how important it is to have a two-way relationship with retailers in order to share data that is useful to both parties. Plus, she explains why we can all learn a little bit from our international peers and what sorts of innovative approaches ecommerce brands can implement on their own right here in the U.S. Oh, and Arabella teases some exciting influencer content coming up soon that AB put together with Travis Scott that you’ll definitely want to check out. Enjoy this episode!

Main Takeaways:

It’s a Two-Way Street: With retail partners, sharing data goes both ways. Whether it’s out-of-stock data, landing page placement, or general consumer insights, there’s information that both sides need to have access to. Establishing a reciprocal relationship of data-sharing will not only take the partnership further but transform how you can serve consumers.
Digging For Data: Accumulating and then analyzing consumer data is the only way to get a 360 view of who your customers are and how they shop. But in industries that are heavily regulated, such as alcohol, having a traditional ecommerce experience is not quite possible, which means you have to get creative. Put on your creative hat and listen in to hear the many tactics you can use to get intel on your customers in a fun and unique way.
Take What You Can: Although China is far ahead of the U.S. when it comes to ecommerce adoption, and how it has permeated through just about every industry — alcohol included — there are still points of inspiration and innovation that can be brought to the American market. Creating full omnichannel experiences and engaging with customers at every touchpoint on the customer journey are just two examples.
Premiere Partnerships: Influencers are a dime a dozen these days, and it’s easy for a brand to pay for someone with a big following to promote a product. But the ROI from that is negligible. What works better is a more authentic strategy in which a brand forms a true partnership with an influencer or celebrity who is truly connected to the product and the campaign in a personal way. That authenticity resonates with audiences better than most other marketing activities.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone, welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder and CEO at Mission.org. Today, we're chatting with Arabella Watters, the Head of ecommerce for Category and Insights at Anheuser-Busch. Arabella, welcome.

Arabella:

Thank you. Happy to be here.

Stephanie:

I'm excited to have you on here. Is it too early for a beverage? Or ...

Arabella:

Yeah, it's only 10:30, otherwise, I'd definitely would be having a seltzer next to me, for sure.

Stephanie:

Yeah. So speaking of seltzer, I was think that you're the perfect person to talk about all things D to C alcohol, not just because you're working at Anheuser-Busch, but because of a company that you actually started out of college that I saw you were taking an entrepreneurship class, and you actually took your project and ran with it, and I want to kind of start there because I thought that was really cool, and I was like that's impressive. Probably no one does that that I know of unless maybe you're at Stanford that's a little bit more normal, so tell me a little bit about that.

Arabella:

Yeah, definitely. I think it's a good segue into how I got to AB for sure. So I founded that company, Mojo, with my partner, exactly like you said, during college. So we were taking an entrepreneurship class, had this idea, and just decided to run with it because it felt like a really kind of rich and impactful idea that could actually go somewhere. I'd say it's super interesting when I think about how it kind of came to be and came to fruition. My partner and I at the time had both been studying abroad during our junior year. We actually were in South Africa, and had just a lot more exposure to kind of the alcohol and drinking culture in a less regulated place, which sounds really interesting and funny, but in South Africa, you can buy wine whenever, the drinking age is a little more relaxed and people are getting a bottle of wine, having a picnic, going for a hike, all of that.

Arabella:

Kind of more casual, outdoor, daytime drinking behavior. And we found it very, very, one, fun, and two just interesting and kind of something that was missing from the alcohol market in the US. So I've always liked wine. I grew up in California so it was something I was familiar with, but we kind of had the realization that wine in the US was very much so kind of stogy, a lot of different options without a lot of different differentiation, and the majority of the time it's very heavy red wines that make you fall asleep, and hard to drink.

Arabella:

So the insight that I kind of had was that there really was this growing opportunity for more easy to drink, lighter, social beverages that could be portable, you could take them on an adventure, you could drink during the day or during a more active activity. And I'd say so that was really kind of the thought that led to Mojo, which was basically a wine spritzer based off of this drink in Spain that was wine and Coca Cola. I think it actually was such an amazing experience to have and to dig into those insights and build that brand because now that was five years ago, but we're seeing that same trend of easily more portable, lighter, more sessionable drinks like seltzers or canned cocktails are really growing at such a huge speed. So I do feel validated that one, that was an insight that was definitely something that was a real trend that was growing, and two it really kind of exposed me to the alcohol biz early on.

Stephanie:

You were just ahead of your time. You're just a futurist.

Arabella:

I like to think of that too. It's funny though, now looking back when we were pitching it, it was kind of just this counter culture idea of oh you want to put wine and make it sparkling and you think people are going to drink wine outside during the day? And now people are chugging seltzers left and right during the day, so it's pretty much the same thing. So it's nice to feel validated now for sure.

Stephanie:

I'm sure that was a really good experience. So what ended up happening with that?

Arabella:

So I think the other less fun and more kind of realistic part of the experience was getting exposure to A, the legal landscape of alcohol in the US, so super challenging, a lot of barriers to entry whether it's getting permits, getting the ability to be registered as a wholesaler and selling to retailers and all of that stuff. So I'd say that in itself was challenging. We got through it, but the bigger challenge was just in order to really have the scale to get a beverage company off the ground, you need to have a lot of capital, and like you said we were pretty close out of college, had done a couple entrepreneurship pitch contests to get some funding and had gotten some funding through crowdfunding sites, but didn't have a huge amount of money at our disposal.

Arabella:

So I think what kind of is full circle for me is while we had to make the hard decision to not continue pushing on with it since it was so expensive to be getting a proof of concept, now I get to be at AB where it's such a huge scale operation where those things aren't a problem. So I like to think I can take some of those learnings and apply it to my job now.

Stephanie:

Yeah. I was actually just going to say you were in this kind of D to C world if you would have been fully launching and everything, and I'm sure Anheuser-Busch saw that and they're like that's exactly what we need, someone who was ready to start talking one to one to a consumer, like have the idea to do that. How was it when you transitioned to Anheuser-Busch and you're working on ecommerce for category and insights and all of the sudden you're like oh I actually can't talk to my consumer directly, it's like a roundabout three tiered system that I don't even know who I'm selling to really.

Arabella:

Yeah. You hit the nail on the head. It's definitely adjustment, it's definitely different. I think when I was thinking of joining the team, what I was really drawn to was exactly what you were saying, that there kind of was this gap in understand of who the ecommerce alcohol shopper was, and I love insights, that's definitely my passion point of my job. I love the whole job, but understanding the shopper really is what kind of gets me up and going in the morning. So yes I was drawn to this new channel that it was a new way people were shopping, that there really wasn't a huge amount of information available.

Arabella:

I think now being actually faced with it and not having access to direct sales data and to actual onsite metrics because we're working through the three tiered system with retailers definitely has been a challenge. Although I do think it's really kind of forced me to think creatively and think about how we can structure our research and our insights approach, and take directional insights that we have from in-store and take them to online and say what is similar here, what's different? It's pushed me to kind of go above and beyond to think about how to approach the problem of who the shopper is and that in itself has just been incredibly valuable.

Stephanie:

Yeah. I was thinking that too, you really have to get creative to get data in your industry, and I thought what AB is doing around merchandise and shops and all that is really interesting. I saw a quote where someone at your company said, yeah, we essentially launched these stores and we consolidated them so that we could get shopper data, because we really can't get that easily anywhere else on ecommerce. So tell me a bit about that approach and do you think the people buying merchandise are the same ones probably buying the alcohol in store?

Arabella:

Yeah. I mean it's super interesting to think of that. I don't know if it's the exact same shopper always, but what I do know is that anyone who's probably buying merchandise from us is definitely a brand loyalist, because you're not going to want to wear a Bud Light sweatshirt if you don't really love Bud Light and feel really strongly about the brand.

Stephanie:

But I saw a crop top in your store and I'm like that's cute. I don't know if I ever would have worn like a Busch branded T-shirt, but that crop top, it's something. I like it.

Arabella:

Yeah. You know what, the Bud Light merch is actually really fun. I have a beanie that I wear sometimes and I get endless teasing from my friends but I love it. So yeah, I mean I think it's definitely brand loyalists, or to your point, people who feel, each of the brands that are within AB have such strong brand voices and such legacy and such power pretty much in the market, and so I think the merchandise, while it doesn't directly relate to us selling beer, it does do I think some great work in furthering the brand awareness and people feeling like they're connected to the brand and want it to be something that's part of their day to day, and I think the ability for us to, I think where I'd love to do a little bit more work with the merch business is thinking about how we can kind of create more of a one stop shop experience, so how can we partner with retailers to get that Bud Light crop top paired with a Bud Light six pack and get it bundled together so we can merchandise and sell that in one fell swoop, because I think that sort of would be the ultimate goal that we can get the shopper having the actual product and also that brand loyalty experience.

Arabella:

But I know that's a huge, huge priority, because to your point, we can't capture the data, but I know with the merch biz, that's a big focus for our next year in 2021.

Stephanie:

Yeah. So what other creative ways are you all going about to find customer data so then you can personalize that experience in one way or another, like what are the things that you're trying out that you're having success with right now?

Arabella:

So we pretty simply just work as an insights-driven org to be bringing as much data that's specific to the retailers as we can.

Stephanie:

Yep. And how do you think about out of stock issues? So we just had a guest on from Intel where they were saying they're trying to work with all these retailers, he was from the internet of things group, and he was saying there's so much opportunity with retailers where they oftentimes don't understand their inventory, things can remain out of stock for an entire day and they'll say that they're on it but they actually had no idea, how do you handle that from a tracking perspective to make sure that your retailers are keeping your stuff in stock and it's being tracked properly?

Arabella:

Yeah. So that definitely has been one of my big goals for this year is to really get more of a data specific perspective on out of stocks, on how we're doing on the shelf online, everything that you're saying. So we actually just partnered with a digital shelf tracking company, Profitero, I feel like you guys maybe have heard the name before. So our big plan with them in the next year is basically to take on all those things you're saying and give it more of a data lens so we can be reporting out weekly and tracking what products are out of stock and what we should be communicating to the wholesalers to be getting them updated and fixed, because we know that from an ecommerce perspective, out of stocks are a huge, huge issue because in store, you're out of one pack of Bud Light, well the shelf is stocked in a way that Bud Light is a brand that has multiple SKUs, you could easily just grab the other one that's there and go on your way.

Arabella:

Online, when something is out of stock, a lot of retailers will simply remove it from the site so you don't even see it, so that recognition that we get with our brands is completely gone if the product doesn't even show up on the site, and then you see them moving to a different competitor or substituting in a different way. So I think that really it's a huge, huge piece, and it's especially huge with our pure play partners, so those who are only online retailers, because we're able to have a little bit more of a direct connection to them as well and work through those things.

Stephanie:

Got it. Cool. So the one thing I'm thinking about too is attribution around marketing campaigns and things like that. How do you think about seeing if something that you're doing out in the world is actually impacting sales, if once again you have to be like let's look at our retail partners and see what's happening, or how do you think about attribution in your industry?

Arabella:

Yeah. I mean it's definitely a challenge.

Stephanie:

[inaudible].

Arabella:

It's a challenge, it's a constant challenge. It's something that I'm always working on to try to, again, thinking creatively and outside of the box, I think one way that we are working on thinking about how our campaigns are performing is we track our placement on the shelf on retailers, so what percentage of the first page we have, what percentage of the first five spots we have, and the way that a lot of algorithms work with the retailers is that they're based on sales and conversions. So what you could do is sort of back into how a campaign or product is doing by looking at the change in where you're placed up on the site, and that's something that's like of course, it's definitely there's room for error there, but I think from a directional standpoint we're able to see, okay we ran a campaign on Michelob Ultra Seltzer all of January and it started at the bottom and now it's at the top. That means that if we were driving to that retailer, it worked. Right?

Arabella:

So it's a little bit more binary in that we're not able to get so, so granular, but that's one way I think from the category and the retailer perspective we're able to either check or not that something is working.

Stephanie:

Man, you're in a tough industry.

Arabella:

Yeah.

Stephanie:

I haven't had to ask questions like this on any of my episodes, but it makes me wonder, oh actually except for Haus, when I was talking to the Haus founder.

Arabella:

I listened to that one.

Stephanie:

Okay yeah, that was where I learned about the three tier-system, but it makes me wonder is a three tier system going to go away? Because it seems like there's companies right now who are kind of just working to get around that system, and once that starts happening it's like maybe that system's just broke, and with the move to D to C, why would it still be there then if everything else can have access to the consumer, it seems like this industry should too, with the proper protections.

Stephanie:

Yeah, that just feels so odd to me. Especially the world that we're in today, and just thinking that you can make something and then not be able to sell it on your own just feels very archaic in that you have to go through a retail location or whatever it may be.

Arabella:

Yeah.

Stephanie:

It just feels not very business friendly, but that's [crosstalk].

Arabella:

It's super interesting also to think about as marijuana is going to eventually I'd imagine be legal on a federal level, then how are they going to regulate that as well, because it's sort of a mirror industry to us, is that going to be something you also have to go through a wholesaler

Arabella:

But I think that's another probably will give us another opportunity to have the bigger conversation because it's sort of like if THC and marijuana is able to have this direct to consumer business relationship then why can't alcohol as well?

Stephanie:

Yeah. It sometimes seems like older industries are punished from the older times, where as you're new and up and coming, you move so quickly where it's like you can get much further ahead where it's hard to pull you back in when you're already like well now I'm out delivering everywhere in California.

Arabella:

No, it's so interesting. I think that's such a great point when you think about the Ubers or AirBnBs or the share economy of the world where they just absolutely turned old industries on their heads and didn't really think about the regulations, and then they're so big now that it's harder to go backwards.

Stephanie:

Yeah.

Arabella:

Exactly. And overturn those things.

Stephanie:

I think it's good sometimes. It's good to push the regulations forward and bring them up to the times.

Arabella:

Yeah, I agree.

Stephanie:

So the one space that a lot of guests have talked about is what's happening in China. And what was interesting is I saw that AB was looking at China now as kind of the market that they use to bring a lot of learnings from ecommerce back to the US. So what are you guys seeing there and what kind of learnings have you actually been able to bring back to the US and apply versus what have you been like whoa that's just such a different market, it's very different there and we kind of keep it siloed when it comes to what we're doing there versus in the US or in Brazil or all around the world?

Arabella:

I'll start off by saying that while I work on the North America business, we do have a global e-retail center of excellence where we meet frequently to talk about best practices and get inspiration, just like you're saying, from markets where while it may not be cookie cutter to our market, we're able to see what they're able to do and how it performs and think about how we could apply it to what we do. So China is definitely an amazing example. I'm always thinking about what they do kind of as the best case scenario for ecom, I think we have to always take it with a grain of salt just because there are legalities, to the convo we were just having, they can sell directly to shoppers at any point I believe in the shopper journey.

Arabella:

So that's amazing. And we've really been able to I think one of the things that struck me the most, we had the China team present to us last year on double 11, the singles day, and what they have been able to do with our brands there like Budweiser being one of the huge ones, and kind of just creating this huge omnichannel event where we're taking over every single possible touchpoint for the shopper, whether it's a vending machine, or the apps on their phone, or the actual grocery store, doing activations where there is a concert and then you can click the video and get your Budweiser delivered. Things that sort of feel to me like this crazy world of digital, physical connection that I think in the US we just don't have yet in general, and we definitely don't have for alcohol because it's so regulated. But I think that's something that we try to take inspiration from and think about okay, while we can't have a Budweiser delivered in three minutes from someone's cellphone, we can think about how important it is to take over from a branded perspective like multiple touch points from the shopper journey, and communicate with them not just during the shop on the retailer, but with a more interactive experience before.

Arabella:

I know our D to C team has done some awesome things like international beer fest which was I think in August, and then a New Years Eve concert festival series, those kinds of things, where we're getting shoppers on, they're interacting not only from a transaction point of view, but from just feeling close to the brands, having an experience in a time when we need them even more so, and those have been hugely successful. So I'd say that China is an amazing example. I would love to go over there and work, I think I would learn so much. It's kind of the pinnacle of not having to be regulated versus we're much more in that regulated space.

Stephanie:

Yeah. I was just chatting with a guest, Andrea, yesterday, where she said they brought an influencer from China to Harvard so the Harvard students could see it in live and action, so they pulled her screen up so they could see what was on her phone or something, and then she was selling Harvard shirts and sold like thousands of them in minutes. She's like that's when I realized that's crazy. And I don't know if that is the same thing that would happen here. You definitely see influencers driving sales, but I don't know if it's to that degree of and I have a pen, and now 10,000 of them just sold because I said I had a pen. I don't know if it's to that degree, but it's very interesting to watch.

Arabella:

Yeah. That's a great question. I know that influencers, they've been trying to make all the social platforms so much more shopable this year, and I feel like I don't have stats from Instagram, but I feel like it's not quite there yet to the point of what you're saying where an influencer can just be selling things and have this huge, huge power to be creating transactions. But I think another interesting thing about the whole China piece with that is that so much of their tech is just integrated in whether it's the social media, it's with your payment system, it's with the equivalent of Amazon, and so it's just a lot more seamless. But yeah, the power of, we certainly have people in the US who can sell things. Actually an amazing example would be we're doing a seltzer with Travis Scott that's launching in the next month or so, Cacti. I'm super, super excited for it, and I think that's a great example of he partnered with us to create it and he has such star power, so I think it will be incredibly fascinating to see how that does.

Stephanie:

That'd be cool to bring you back and hear how that campaign went, because I think a lot of people have been debating around do big names, of course they will drive sales, but at what point is it authentic versus not authentic? How do you structure the campaigns to make it, sometimes you'll see certain people being like oh I always use this teeth whitener, or I sure love this whatever it is, and you're like do you though? That's very inauthentic. So it'd be interesting to see how you guys create a campaign in a way that's a partnership instead of just a one off, like okay go put this ad on your Instagram and see what happens.

Arabella:

Yeah. It's a great point. I think there's so much influencer marketing that can be so disingenuous, exactly. It's like I love this product. Cool, that's great. It doesn't have any emotional resonance with me. I think with Travis Scott, what the team did was really, exactly what you're saying, partner with him. So he was so in lock step with the creative process and the brand building and the actual liquid itself, that when it came time to, we announced it about a month ago, when that was kind of coming to fruition, he was incredibly invested in having it be successful, and it feels really authentic to actually who he is, like the whole Cacti, Cactus Jack thing, and I think that definitely is part of the hopeful success of it, and yeah I'd love to give you guys an update when it launches in March. I think it's just going to be super, I know the initial stats that we've seen like on social media, it's already the top alcohol following of any brand that's out there.

Arabella:

It's really an amazing testament to how, to your point, how powerful people can be and what is it about Travis Scott that's so resonant with so many people. Is it he's incredibly creative? Is it the whole kind of eclectic side of his brand? Is it because he's Stormi's dad-

Stephanie:

Probably.

Arabella:

And Kylie's baby daddy.

Arabella:

But neither here nor there. He's incredibly powerful, and I think it will just be a good whether it is a smash hit or not, it's a good test to what you're saying about can a person really be the driving force behind a brand?

Stephanie:

Yeah. I would also like to see the lifetime value of that person, is it a one hit like I'm going to try this out? You obviously have to have a great product behind it, which it sounds like you invested heavily to make sure it was good in partnership with him, but how do you keep those people around after maybe the excitement is kind of dying down, how do you make that an everlasting brand and something that people actually come back to?

Arabella:

That really is, exactly, that's the special sauce, that's what's going to make people feel connected to it, and also that the liquid is filling some need for them that they actually like and want to continue drinking. Because there's only, I feel like with consumables, what's always kind of driven me to be interested in food and bev and alcohol is that while there is the branding and the specific need that it's filling, it's also there's a piece of it, you're eating it, you're drinking it, it has to be good, versus I think with a lot of the disruption with D to C brands across kind of industries, there's a lot of copycatting going on and things that are not product driven and really brand driven which is not always a bad thing, but there's not really room for us to do that because if it tastes bad nobody's going to re buy it.

Stephanie:

Yeah. Yep. Love that. So how are you thinking about maybe the next couple years in your industry? You guys had to shift really quickly, I'm especially imagining how big the company is, how maybe certain processes were maybe a little outdated, how did you shift really quickly to focus on ecommerce and where do you want to head over these next couple years?

Arabella:

Yeah. So I think we're in a really strong position because AB has felt like ecommerce has been something that's important for I believe the team started five or so years ago, so really when building the foundation for this channel for a while, but totally to your point, this year has completely transformed the way that we do business, just because the sheer volume of interest from players wanting to get online, the amount of people who are entering into the category online, so it's double the amount of households in the US of people who are buying alcohol online, and just the sheer simplicity of that and the size of the way the industry has grown, our category in the channel has grown, has definitely been a big change.

Arabella:

So I think we were set up for success going into it and it kind of was more of an accelerating and scaling everything that we were doing, so making sure we were supporting more regional partners versus just the Walmarts and the Amazons and the Instacarts of the world. Thinking about how to optimize what we were doing in a really fast way, so just like what we were talking about before, trying to track campaigns and get a green light or a red light on whether it is actually doing well. I think one thing that we worked on during COVID that was a big pivot and I'm very proud of is we created a site called buy beer online, and it is designed, basically during COVID huge boom but not everyone knew exactly where to go to find their alcohol online. We found that a lot of people were searching in Google beer delivery, how do I get beer delivered, buying beer online.

Arabella:

So we created this site that is designed to be bridging that gap and so it has all of our brands on it, and it also links to an ecommerce product locator. So you come on, you can find craft brand that you like, click it, and it will tell you where you can order it for delivery or pick up near you.

Stephanie:

That's smart, so you're optimizing on a new search trend which I know myself personally has been like how to get wine delivered, and being like where do I even start, and I have to download this app or this one, and this one's going to take four hours, that's too long for me.

Arabella:

Yeah. Oh totally. Exactly. We actually should have it where it's like 30 minutes or less.

Stephanie:

Yeah. Important. Sometimes you need it right when you need it.

Arabella:

It's true. I just actually saw a piece of research where it was like a quarter of people are immediately consuming right after, which makes sense. Sometimes, exactly, you need it. But yeah. So that was I'd say something we created like within a couple months during the beginning of COVID to make sure that we had a tool like that to be helping shoppers, and I'd say it's been really strong for paid search like we're saying, and then also for a lot of our craft brands that really relied on regionality and that on premise bar experience, brewery experience. During COVID it was sort of a big issue where shoppers didn't know where to get the craft brands that they loved, so we were able to in a way make our craft website, so a Goose Island, or a Karbach, we live in Austin, make those sites shoppable by linking out to buy beer online so you could get the shopper to an actual place where they could find the beer.

Arabella:

So that's been really impactful and very cool for us to be doing during COVID and I think the more we can do things like that where we're owning the full experience because to your point, we also capture all the data that comes through too. So it's like win-win on both sides.

Stephanie:

Yeah. I just love those stories because it really does highlight the creativity and innovative thinking at AB that maybe you wouldn't have done if you would have had it easier. Like if you would have had that easy one to one consumer relationship you wouldn't have had to think about what are other creative search terms we can go after and content we can create and ways to reach our consumer that a lot of brands don't really have to think like that, so it's really cool.

Arabella:

Yeah. It is really cool, and I think that's one reason I love AB is it's very creative and innovative place. Which I don't know if everyone knows that, but it really is. And I feel like if it was direct to consumer, there's also you can really kind of get caught up in the tactical pieces of things. So to your point, I would just be obsessed with the open rates on my marketing emails and how I'm converting people, which those things are amazing and important but I think we're forced to, like you said, think outside the box and figure out more about our shopper in a way that's kind of a little bit unorthodox.

Stephanie:

Yeah. That's cool. So the last piece I wanted to touch on before our lightning round is how does AB think about their tech stack for, because it's B to B to C, how did you guys have to adjust, if at all, to all the sudden be able to let all these retailers maybe order online in a fashion that was not happening before, like pre COVID, did you have to adjust your back end to make it simple for people to come on and order and make that an easy relationship or what did that look like?

Arabella:

Yeah. So luckily because we have the three-tiered system, we're not actively funneling any sales through our own tech side or back end. Actually what we try to do though is as a lot of retailers have come on in the last year or so is leveraging our knowledge and our partnerships to offer them the best connections. So whether it's connecting a grocery store with the best on demand delivery app, GrubHub or Drizly or whatever it is, and creating those relationships so that they can get on board I think is really what we look to do. I know that that's not a techy answer, but it's definitely what we try to optimize. And then also helping them with the payment platforms too, so helping them onboard with a Stripe, or an Apple Pay, or just at least giving them the tools and the information, it's something that they have to do on their side as the retailers, but we like to try to optimize and help them get to the strongest place to launch as possible.

Stephanie:

Yeah. Very cool. All right, let's move over to the lightning round. The lightning round is brought to you by our friends at Sales Force Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready?

Arabella:

I'm ready. Scared.

Stephanie:

Yeah. Dun-dun-dun. What one thing will have the biggest impact on ecommerce in the next year?

Arabella:

You know what I actually feel very strongly about is the presence basically, the fact that retailers and D to C companies are moving towards creating not just the shopping experience on their sites, but more of a content hub. And what I mean by content hub, not just to say buzzwords, is a place where not only are shoppers coming to buy your products, but maybe they're looking at recipes, maybe they're doing mixology, if it's retail, maybe you're giving them styling options or more information about your products. Really, I've seen more and more companies do this this year as I think it's a two fold thing. It's become the status quo is people know that shoppers love content and social media has been so big in the last few years. And then secondly, as people are more and more at home, more on their phones than ever before, and that's not a COVID answer, it's just true, that if you can capture someone's attention to actually get them engaged and interacting and making everything on your site shopable, I think that's really going to be kind of the bread and butter that can really change your experience or not. And I know that for us, for ecommerce with alcohol, that's especially huge because we're not quite there yet and I really want to get there.

Stephanie:

Yeah. I love that. All right, next question, what was your favorite virtual event that you did at AB in 2020 and how do you think about success for these virtual events that you're saying performed really well?

Arabella:

What a good question. Yeah, I think that the international beer fest that we did in August, so I wasn't leading that, but our general direct to consumer team was, and I think that was incredibly successful because it came at a time when people were A, really starved for that interaction and the feeling of connecting with people and doing something and having something to look forward to. And B it worked in a really strong way where it connected with our brands. So international beer fest had, there was music happening, a few artists who were sponsored by our brands, I think Post Malone did a thing, sang, so there was that element where it was a little more passive, it's encouraging you to crack open a beer and watch the concert. Super strong, but then also just other things, like I believe we had a cooking tutorial and a mixology thing, and trying to create something that is for everyone without stretching yourself too thin and also being true to the brand is super key, and what I know was also a great add to it is we were able to leverage buy beer online to also direct you during the event so that people could find places to shop for the products.

Stephanie:

What did the traffic look like going to the buy beer online during that event or afterwards, what kind of conversions did you see going to that?

Arabella:

Yeah, so I believe we actually saw a lot more conversion coming up to the event versus actually during it. Which is interesting for sure. I think we're in much more of a place where shoppers are still shopping for a little bit in advance, like planning ahead, like I saw this ad for this thing, I'm going to buy beer for this weekend to watch it, versus looking and saying I'm going to get drinks late in 20 minutes to get delivered. So we saw a lot of traffic leading up to it definitely and then a lot of live interaction during it, but not as much I think quick conversion onto those on demand platforms, which I think just speaks to the fact that click and collect and pickup is just a little bit stronger right now than the delivery aspect, but I think we'll probably see that grow as Uber just bought Drizly literally yesterday, so that's going to be a big game changer for scale.

Stephanie:

Yeah, everyone's trying to figure out last mile delivery and how to make it work. There's been quite a few interesting articles about why some of those companies like the DoorDashes need to expand. Very cool. What's up next on your Netflix queue?

Arabella:

Oh. What a good question. I am currently making my way through Grey's Anatomy. I've been watching it for so long, since it started, so it's kind of my comfort watch and after a long day with a little Zoom fatigue and talking on the phone all day it's nice to just relax to something that I know is reliably dramatic and juicy.

Stephanie:

That's great. If you were to have a podcast what would it be about and who would your first guest be?

Arabella:

Good question. I think, you know what, I'm kind of a fitness buff a little bit, and I've gotten really into it during COVID just as like a distraction and a thing to keep me sane. I love Pilates a whole lot. I find it very, very, it focuses my brain, it's challenging, I don't have to jump around. I don't love HIIT, it's not my fave. So I would love to do a podcast that kind of explores the relationship between human psychology and exercise and how those things are so entwined because I really believe they are. And I think as my first guest, I'd love to bring on someone, I actually just read a great book about endurance running and ultra marathons where they run like 200 miles-

Stephanie:

Wild.

Arabella:

I don't run [crosstalk]-

Stephanie:

Two miles sounds like, whew.

Arabella:

Yeah, exactly. I'm like one mile. I find it so, so fascinating how you really can push yourself. So I don't know a specific name but I'd like to bring on someone who's an endurance athlete to kind of pick their brain.

Stephanie:

Yeah. Very cool. Aright Arabella, it's been awesome having you on the show, such a fun conversation. Where can people find out more about you and Anheuser-Busch?

Arabella:

Yeah, definitely. So you can check out my LinkedIn I'd say if you want to find more info about me. And if you're curious, please check out buy beer online, we have a lot of info about the biz and all of our brands on there as well. And you can feel free, if you'd like to reach out to me, I don't know we can maybe put my email address somewhere, I'm happy-

Stephanie:

[inaudible].

Arabella:

Yeah, that say it's being risky, but I'm always happy to chat with people and connect. I think that's really kind of what is the bones of business and makes the world stronger. So shoot me an email.

Stephanie:

Amazing. Yeah, thanks so much for coming on the show.

Arabella:

Of course. Thank you.

Building the Ultimate DTC Marketplace

info@mission.org (Mission) — Thu, 25 Feb 2021 08:00:00 +0000

If it seems like a new DTC brand is launching every day, that’s because it’s true. In every industry, across every vertical, on every channel, the next “big thing” is competing for your attention, your clicks and your cash. As a consumer, sifting through all that noise and filtering out which companies are worth your time can be a daunting task. And as a brand, it begs the question: how do you set yourself apart from the ever-growing pack?

One option is to find a trusted source to vouch for you. Matthew Hayes can be that source, and his new marketplace, The Fascination, is where he wants to lift up some of the most worthy DTC brands coming to market.

The Fascination is a product recommendation and reviews publication focused on emerging and purpose-driven direct-to-consumer brands, large and small. Users of the platform have the ability to filter through vetted brands, digest the company’s story, and even transact all in one place.

On this episode of Up Next in Commerce, Matthew dives into lessons he learned while building Leesa Sleep, why curation is so important in the rapidly expanding direct to consumer space, and gives his take on why the convergence of media and commerce will be the one thing that impacts ecommerce the most. Plus, I even pull out a few stories from his trip to Richard Branson’s Necker Island.

Main Takeaways:

Curation Station: The saturation of the market with a new DTC brand every day is creating issues for consumers and brands alike. With so much clutter, it’s hard to stand out. Through measurable metrics, in-depth reviews, and by holding brands up to certain benchmarks, The Fascination created a space that customers can trust, and brands want to be listed.
Layers of Use: For a brand to stand out, The Fascination has found that being mission-driven, promoting social good, and leaning into and highlighting the unique aspects of your business will be the most effective strategy.
Lessons Learned: While not everyone can pick the brains of the biggest entrepreneurs in the world, when you get the chance, it’s wise to listen. Matthew was able to visit Necker Island and spend time with Daymond John, Marie Forleo, Tim Ferris, Seth Godin, and Richard Branson. Tune in to hear what advice they gave that has been helping him to this day.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone. And welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder at mission.org. Today, I'm chatting with Matthew Hayes, the co-founder at The Fascination and previously on the founding team at Leesa Sleep. Matt, welcome to the show.

Matthew:

Thanks for having me.

Stephanie:

Yeah, I'm very glad to have you on. So I was hoping we could start with maybe Leesa Sleep. Because when I saw that I'm like, "Whoa, you were like an OG in the D-to-C space," and I thought they'd be a good jumping off point.

Matthew:

Yeah. So I was part of the founding team at Leesa. Yeah, we launched it back in 2014 before everything exploded. Right? So we were very early. We were one of the first BedInABox brands to get out there, Tuft & Needle came maybe, I don't know, six months to a year before us. Casper was literally right before us. And then we were out right around Thanksgiving of 2014 and that whole industry just exploded under our feet. We had the wind at our back for most of our tenure, especially our growth years. But things are a lot different now and t's a different ball game in terms of launch and growing a D-to-C brand in 2021.

Stephanie:

Good. Tell me a bit about the differences. I mean, obviously the world is very different and there's a lot of new trends coming out about what to expect over the next couple of years, but are there any lessons that you took away from Leesa that are still relevant or is the world just like in such a different place now?

Matthew:

No, I think it's still really relevant. I think a lot of the stuff that we were learning as we grew is incredibly relevant to the way that we launched The Fascination, the way that brand founders are thinking about things now. When we first launched in 2015, cost of acquisition were beautiful. Like all day we could scale the auctions across Facebook and Google, were very, maybe a fifth of what they are now just in terms of competitiveness. Just, I mean the mattress industry specifically there was 180 entrants after we launched, so a huge amount of volume coming into that space and just generally in D-to-C. So the cost of acquiring just pure play digital customers was going up and people were seeing the writing on the wall and starting to diversify into brick and mortar.

Matthew:

And so I think that was one of the things that we realized, is we've got to have a diverse channel mix. And so we struck the partnership with West Elm, we leaned more into Amazon. We looked more at international and we actually set up our own brick and mortar stores. So I think the combination of that brand awareness and exposure helped our brand tremendously. Whereas a lot of brands stuck it out, stayed pure plays and they learneD-to-Costly less and overspending on acquisition.

Stephanie:

Yeah, that's definitely the biggest thing that I see from the past couple of years or past decade is like before you could just focus on paid acquisition, like throw a bunch of money at it and one's really, they're going to come to you either way. And then now it seems like a lot of the, I guess the brands that are ahead are more media companies now, and there's a big spectrum between paying for people versus organic or versus starting a community and then launching a product to them. So it does feel like a definitely a different world than just like pay, and grow, and scale up as you go.

Matthew:

Yeah. I mean, we're seeing that a lot actually. And I think our notion of how to build a profitable business with The Fascination is quite a bit different. No, we're not a pure play own D-to-C brand selling our own products, we're essentially a marketplace, but what we've done is we've seen the success that media companies have had in building an audience that's super loyal whether that's The Hustle, or Morning Brew or The Scam, all of this audience aggregation and demand with these customer demos, there's so much that you can do with it. And so, we saw a bit of an opportunity and the fragmentation that was happening across D-to-C brand for popping up literally every day. And you start to become a little leery of, is this a good brand? Is this is a good product? Does this align with my values and tastes? And we saw this need for curation across all spectrums of D-to-C really. And we saw an opportunity to really create a media platform and a commercial platform around that.

Stephanie:

So let's dive into The Fascination a bit. So it's a marketplace. You guys are curating D-to-C brands. I saw you have filters focused on the product technical quality, also the soul of the company. Tell me a little bit more about The Fascination. How do you allow brands into the marketplace? Yeah. And any other details around the platform?

Matthew:

Yeah, so I mean, people are basically referring to it as a marketplace meets magazine, which I think is an accurate description. It's basically at its core, it's a product recommendation and reviews publication specifically focused on emerging and purpose-driven direct to consumer brands. So in much the same way that Wirecutter or the strategists reviews top products and writes those objective third-party reviews and recommendations, as a media publisher we're really doing that, but we're focusing in on a subset of these D-to-C brands that are new and emerging and have purpose driven values.

Matthew:

And the idea is to create a single platform where people can come and discover new brands, they can read reviews and research those brands and products, and they can shop deals all in one place. So it's a linear play from discovery all the way through to purchase.

Stephanie:

Yep. So who are some of your favorite brands on the platform right now?

Matthew:

There's so many good ones.

Stephanie:

[inaudible].

Matthew:

Yeah, I know I'm going to get in trouble for this. We've got badges across the site, which are really cool. The badges call out things like women and minority led businesses, or organic, or made in the USA. And so like Girlfriend Collective is one of our women and minority led brands. Haus is another-

Stephanie:

Even Haus on, yeah.

Matthew:

... Yeah, they deal the [inaudible] and great products, great brand story.

Stephanie:

Delicious.

Matthew:

Delicious. Yeah. I was just chatting with the founders of Huron, which is a men's skincare line. Awesome story. And then we've got the big names that you'd expect. Like we've got Allbirds on the platform. We've got Warby joining soon if they're not up already any day now. We've got UNTUCKit so, those it's a nice mix of the old school D-to-C incumbents with a lot of really cool emerging brands that honestly I'm intimately involved in direct consumer and a lot of these brands I hadn't heard of for the first time.

Matthew:

So if you think about like, as it broadens out the halo from the bulls-eye of our tightest demos, there's going to be so many people that are discovering these brands for the first time. And that's really what we want. We want some of these big names to attract people into the site, and then we want a lot of our awesome emerging brands and products to be discovered while you're there.

Stephanie:

Yeah. That's great. So how are you convincing these larger brands to join the platform? Because I'm thinking your space, I think also is very competitive. I mean, the world right now is headed to a place where everyone wants curated collections. I mean, they don't want to spend a bunch of time everywhere. They want it all in one place. We had the CEO of Fast on talking about, you need the one-click checkout and be able to allow people just to check out instantly and not have to bulk it into a cart. It seems like your space is very competitive too. How are you convincing the Warby Parkers? And the older brands who probably are approached by quite a few marketplace platforms to, "Oh, join us." Why are these brands going with you?

Matthew:

Well, I think we've really a ton on the story and the user experience and just the overall look and feel of our digital product and what we stand for. I think it's also in our favor that we have been D-to-C operators ourselves and we can really empathize to what these founders need. And we've been fortunate to be in the community for several years now. So we had a few close partners that our spring pad, if you will. Not to mention Nick Sharma as an advisor, who's great at pulling in brands.

Stephanie:

He was on our show too, man, I was just-

Matthew:

Yeah, I know.

Stephanie:

... fortunate.

Matthew:

And so yeah, between that, and we had some really amazing brands reach out the first day that just totally shocked us. We have a type form application that comes through and we had a couple of 100 brands, including some of the biggest names in the space on day one, which it was super exciting. And just a lot of founders getting really excited by seeing their brands mentioned in our round ups, or seeing products being shared. So I think that the validation that we're starting to provide, and really empathizing with what brand founders need is something that they're really clamoring for. And I think word it gets out fast.

Stephanie:

Yeah. That's great. So is there any trends you're seeing right now around what customers are most excited about? I mean, I'm guessing you have all this data now and you can see, okay, a bunch of people are coming on during quarantine and buying Haus. We need another type of Appertiff or something to offer that's similar because we see so much engagement there, any trends?

Matthew:

I think that one of the things that we've seen that's really interesting is our roundup pieces on brands that are making an impact and just the social impact stories are really, really resonating with consumers. And the brands are sharing the stories, which is just amplifying the message that much more. So the general consumer sentiment that we're getting from a qualitative perspective is that a platform like this is very much needed and like, thank you for building it. So I don't think it's even halfway to where we want it to be, or it could be in terms of the overall product development evolution, but we're going to get there quickly.

Stephanie:

Yep. So how, when you're... You just said that certain stories that you're telling around the brands and the social good aspect of it are really resonating. Is that your main play when it comes to acquiring new customers on your platform is by writing good pieces of content, having the brand share it to get in front of their audiences as well, or how do you think about acquiring new customers?

Matthew:

Yeah, I mean, customer acquisitions, it's always a challenge for a marketplace like this. And that's why from day one, we didn't approach it as a pure play commercial marketplace where you're just aggregating and selling products. From a consumer perspective, that's really not serving the overall need that we're trying to address, which is discovery, research, and shop and convert. And so the research aspect of that is really where we're going to focus a lot of time and attention and work. And what I mean by that is writing really in depth, thorough product reviews that are authentic, that are meaningful, that consumers value and ultimately Google values that content really highly as well. And so, what I'm getting at is the SEO and organic traction and such. It's going to be a big part of how we grow organically, keep our acquisition costs low.

Matthew:

There's a lot of performance marketing things that we can and will be doing. Brands have had tremendous interest in doing paid marketing partnerships, whether that's white listing on Facebook, or sponsoring newsletters, or any sponsorships. I think there's a tremendous amount of demand for that. And we really are just dipping our toes into the very first test there. And then I think PR and having, as I said, our brands amplify, our content is also, it's just going to be a latent, organic way to continue to build low cost audience. I mean, I think if you think about the way that Leesa scaled and a lot of those 2015 brand scaled, we know that we can't run the same playbook and build a sustainable business.

Matthew:

And so as we were launching in early days, it's like being a media company is really hard, right. Coming up with really engaging content every single day, pumping it out, like the Morning Brews and Web Smith's of the world, I take my hat off to those guys because it's not easy, but I think you can already start to see the rewards that we're going to reap from that.

Stephanie:

Yeah. So what channels are you... Well, maybe actually first, let me talk about the content piece, because that's top of mind for me is, a lot of people say you just need to create good content and that's the key to finding great people. How do you go about brainstorming something that will resonate? Are you actually going through maybe search trends and starting there to see what's going on in the industry, and then writing articles around that? Or is it purely, just like, I want to talk about Haus's story and we're going to talk about what they're doing behind the scenes? Like, how do you brainstorm content?

Matthew:

It's a mix of all of that actually. So we've got a number of things that we're covering at any one time. A lot of it is when we have new brands onboarded, we've got to write the brand story and we've got to review their products. That's phase one. And that's like an ongoing process as we get up and running. But yeah, we're also looking at industry trends, category wide trends, search trends around specific products or competitive products to see how we can write really compelling content that meets that need.

Matthew:

And then we're thinking about the cultural relevance, things that are happening topically in everyday life. And we've got a couple of different personas that we look at. And so what are our personas caring about, what's their headspace, and then what are the things that are happening in their specific lives at this very moment in mid January? So as we think through those things, you start to surface really relevant content ideas, and that's where our social content, a lot of our editorial content comes from. And that's generally how we do it.

Stephanie:

Cool. And what are some of the channels that you're most excited about right now, or you think that there's untapped potential? Are you sticking with the Facebook where of course stick the Facebook? How is sticking with-

Matthew:

Afterthought.

Stephanie:

I like that. Hey, they used to be though. Right?

Matthew:

Yeah. Drop that.

Stephanie:

Yeah. I mean, when? It's still pretty relevant, but yeah. Are you sticking with Facebook? A lot of other brands still say that's the best place to reach customers. Are you trying out a bunch of new channels and experimenting? How are you thinking about that?

Matthew:

So Facebook isn't a priority for us right now other than to the extent that we use it for paid social advertising. I would say it's there. Of course it's there. But when we're thinking about building audience, Twitter has been a nice surprise for me, I'm really bummed that I didn't get myself on Twitter several years ago, but Sharon, our audience development team's doing an awesome job of engaging that really passionate community.

Matthew:

I think LinkedIn has sneaky, organic reach and potential. And we found that a lot of our brand founders are sharing our content there and we're getting a lot of engagement.

Stephanie:

They're more organic then, right, because LinkedIn is super expensive when it comes to advertising.

Matthew:

Yeah. All organic. And then stuff like TikTok is interesting as we look at really organic product reviews doing things with founders, I think that's something that we're going to be looking at as well as Clubhouse.

Stephanie:

Yeah. Clubhouse. I think that's where it's at. I'm on there. I listen to people. I think you can connect with a lot of great people on there. I'm still not sure about the unstructured format sometimes where things can go on for hours and hours, but yeah, it seems like there's a lot of potential there to at least connect with new people. I don't know about selling.

Matthew:

A lot of untapped potential.

Stephanie:

Yeah. So I saw that you were also an investor in GRIN. Right. And that's the influencer platform, which is... That's the right brand. Right?

Matthew:

Yup. [inaudible].

Stephanie:

Okay. So our guest yesterday that we had on was, that's her favorite new tool that she's looking into and I had not heard of it before. And I'm interested to hear a little bit about how are you thinking about influencers? What attracted you to GRIN, where's that market headed over the next couple of years?

Matthew:

Yeah. I mean, we've been doing influencer marketing since 2012, honestly. And I think there's going to be a lot more regulation around it for one. So you've got to be buttoned up as you execute it

Matthew:

So I think that's just part of the industry growing up. A lot of these minors are now celebrities in their own right with huge followings and PR teams. And so the days of just engaging with an influencer that way are over. It's really about adopting a micro/nano strategy where you're activating pockets of a couple thousand followers up to 50 to 100,000 followers and doing it more strategically at scale. And that's where I see a lot of brands and agencies having success doing this stuff. So GRIN is just a really awesome tool for managing that entire workflow. Keeping you really on top of things, you can search for look alikes of an influencer. So if you have someone or something that you want to find influencers around, it's great for that.

Stephanie:

That's awesome. And how did you think about attribution and analytics around utilizing influencers and seeing if you're really getting the most bang for your buck?

Matthew:

Yeah. I mean, well, especially with iOS 14 and everything that's going on there, it's always been an imperfect science, we never assume that we would have even close to perfect attribution on influencer activations. So we always treated it very top of funnel and you do what you can in terms of attribution. So you give them trackable UTM parameters, you give them a bespoke promo codes with their name. You give them a landing page experience, everything that you can do to cookie the user on your website and get them into what feels like an authentic customized experience for that loyal following. That's going to increase conversion, I think as much as anything.

Matthew:

And the vast majority of influencer activity is probably happening on mobile anyway. So wherever you're sending them, it's got to be very mobile optimized because if they switch over, your attribution's lost at that point.

Stephanie:

Yeah. And I think that authentic piece you're saying, I mean, it has to fit your brand. The person has to not just be saying something just to say it. And I think taking that longer-term approach more of like a partnership and someone who is going to be a part of your brand, even if they start out smaller and grow with you, will be way better than just trying to target a big name, because I normally don't really put any weight in products that large celebrities are showcasing, just because I'm like, I just know how much money you're getting paid and I highly doubt you're using that teeth whitener.

Matthew:

Yeah, I mean to that point and a lot of grants are basically incentivizing on the CPA or per sale basis with, like you're saying a subset of really loyal influencers and affiliates that they can send that influencer their fall collection of bags and apparel or whatever, and they can get 10 or 15 posts out of it if the influencer continues to see performance. And so I think that's the new way of doing things nowadays.

Stephanie:

Okay. So yeah, viewing it from a content generation perspective of, they're not just posting once trying to get their product off, but they're also creating an article or blog posts that you can repurpose and pull quotes from or whatever it may be.

Matthew:

Yeah. And more frequency drives more conversion. So the more you get that brand in front of your audience, the more likely it is they'll finally take action.

Stephanie:

Yep. So I want to talk a bit about mentorship, which I always love asking questions around this. I saw that you went to Necker Island a few days ago... a few years ago [crosstalk], really? Few years ago. And of course Richard Branson's Island. So I want to hear, what did you learn there? What advice did you hear? I saw, I think Damon John was there, Tim Ferriss, Seth Godin, Marie Forleo, a bunch of great people to learn from. And I want to hear about the stories behind going there. What did you learn, all that?

Matthew:

Yeah, I mean, it was a life changing experience for sure. Damon is still pretty close to us in the business. He got involved with Leesa after we met, especially with their 110 program, and I really just learn from him the hustle, the grind. He told his story about how he came up with FUBU and really built that business from zero. And so, talking about fundraising with him is a different thing.

Matthew:

Tim was on the Island too. I was fanboying out when I met Tim actually, because I was obsessed with four hour workweek, four our body and here I'm chatting with him in person. We actually started talking about going up against Casper. At the time, we were pushing pretty heavily into podcasts and Casper was buying up literally every podcast that we could find, that we wanted to go after. And funnily enough, he would really push a micro strategy to us. He said, "You need to go after these very small podcasts that aren't affiliated yet, that have nascent, but growing followings." And we did, we found 10 of those, especially in comedy and gaming, and we stayed with them for years and they ended up crushing for us.

Stephanie:

Oh, that's great. And did you secure long-term partnerships with this company?

Matthew:

Yeah, I think we're still working with a few of them honestly.

Stephanie:

Oh, that's great.

Matthew:

We just completely sapped the audience, an everyone's got a Leesa now. Yeah. And then we talked with Seth. David and I chatted with Seth Godin, who's a marketing genius. He's like the professor of modern day marketing. And at the time, we had done around 30 million in our first year of sales, which was just crazy. And he was talking about making this leap called crossing the chasm. Basically when you're attacking the early adopter market and you're doing quite well, there's a point at which you have to "cross the chasm" and reach the broader demographic of people. And so I don't remember the tactics that he talked about, but he always impressed that idea of our okay, now we've got to broaden our sphere of influence. We still use that phrase today.

Matthew:

And then Marie Forleo was there and we had a lot of really good, we like chatted one-on-one several times, because I was incredibly anxious. I've always dealt with anxiety issues in my career, in my past. And so we had some frank chats about vulnerability and putting yourself out there. And once you do that, it just eases the tension, eases the anxiety. And I still use that to this day.

Stephanie:

Yeah. I was going to say, does it help now? Because I mean, I definitely feel that too. I remember when we first sold this podcast, then they're like, "Oh, Stephanie can new host it?" And just being like, oh, I usually always would have our other team members host the shows and yeah, I liked working behind the scenes and it definitely was hard being like, okay, you just have to do it. You have to get yourself out there. Did it help afterwards thinking through about her advice?

Matthew:

Yeah, it totally did. And I always think of this idea of demonstrated performance, where it's like, you're nervous about something, you're anxious, you step on stage or you sit in the seat, you put yourself out there and you have a really good performance. And then that just gives you one more step, one more piece of confidence and you keep going and building. And now stuff that I do every day without even looking at my calendar is stuff that I would have just freaked out about all day five years ago. So I think it's just about experience.

Stephanie:

Yeah. Now I agree. I remember even just thinking about doing video meetings, like when I first was starting out in the corporate world and being like, "Oh, my gosh, my first meeting." I was just so scared and sweaty and nervous and then now taking like 10 a day and being like, not even thinking twice. So yeah, I think just doing the work and pushing past and knowing you'll probably fail a couple of times and who cares?

Matthew:

Exactly.

Stephanie:

That's great. And did you meet Richard Branson when you were there?

Matthew:

Yeah. We met briefly. He gave us a talk which was awesome. He talked a lot about Virgin's impact program, and what he's doing there. And so that was really important to us at the time, because we were setting up our Leesa 110 program and that was cool to hear from him.

Stephanie:

That's great. So where do you see the next couple of years headed for The Fascination? What are you guys building for? What are you doing in stealth mode right now? What are you planning for the world to look like in a couple of years?

Matthew:

Yeah, I mean, right now we're really heavily focused on getting the digital product where it needs be to really deliver on a full transactional marketplace that's cutting edge for consumers. So in the next couple of years, we want to have a destination that is super engaging. We want to have brand founders engaging with consumers real time in the platform. We want to have people shopping and reading and researching brands and products all seamlessly, and to be able to buy those products in one click, right? Right on The Fascination.com. And so a lot of things have to happen in the background to obviously make that work.

Matthew:

And then we're always thinking about, how can we acquire the best customers, bring them in most cost-effectively? And it's always on my mind of like, delivering really solid, meaningful content to the audience, not just fluff stuff, but stuff that's really, really valuable. And so that's what I think we're trying to win.

Stephanie:

Well. Yeah. It also seems like there's such an opportunity to... I mean, when you have all these brands and they have access to a lot of insights on their customers or who's coming to their website to then build lookalike audiences off of those brands, and then all of a sudden you have access to customers and you're coming from a different angle where maybe if Leesa would have already gotten in front of a customer two times and they're like, "Nah," they then see The Fascination comes in and they're like, "Hey, check out this mattress. It's like a third touch point. That's very separated." But it seems like there's a lot of opportunity there to get insights at a much more accelerated rate than you would get just by yourself.

Matthew:

Yes. That is the goal. Yeah, there's a whole data infrastructure that we really need to put in place to get the most out of it. And honestly, coming from Leesa for so long, I'm still trying to wrap my head around what that all looks like in terms of affiliate click attribution and how we create audiences and how we do product recommendations. So we're only a month old, but we'll get there. And I can tell you that there is such tremendous demand for what you're talking about. Just leveraging lookalike audiences, leveraging audiences across categories that aren't competitive with one another. At the end of the day, everyone that comes to The Fascination as an interested consumer if we do it right, it's always going to have similar demographic profiles, right. Whether they're a man or a woman. So as you aggregate that at scale, there's a ton of value for brands to be able to tap into that.

Stephanie:

Yeah. It seems like eventually they'll have to be tools for the merchants as well, to be able to interact with all the platforms they're on. Or like, I mean a lot of sales are moving towards the edge. There's a lot of people say and how do you keep track of that? Like, how do these merchants they're selling on The Fascination, they're selling on Fancy, they're selling on not that Fancy is the same, but there are quite a few places popping up where these brands might be like, "Yeah, I want to sell on that platform or over here," but I don't know if enough tools exist right now to keep track of what you're doing and consolidating it all in one place.

Matthew:

Yeah. I mean, it's got to be a challenge for these fairly young brands. There's product feed software that'll handle some of that, but at the end of the day there's manual stuff that's always needed once you're drop shipping and wholesaling and you have retail partners. So yeah, we're going to be thinking about it from the other side, just the same, how do you manage 100, 200, 300 merchants and keep them happy?

Stephanie:

Yeah. Crazy. All right. Well, let's shift over to the lightning round. Lightning round is brought to you by Salesforce commerce cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Matt?

Matthew:

Yes.

Stephanie:

One minute to answer. All right. Yeah. Prepare, drink your drink, whatever that may be. All right. First thing, what one thing will have the biggest impact on ecommerce in the next year?

Matthew:

I think the convergence of content and commerce is, is going to have one of the biggest impacts. You've got media companies that are converging in the commerce, they all want to be transactional. They all want a bigger slice of the pie. They all want more lifetime value extraction from their readership. And then I think on the commerce side you see brands and retailers who are obviously seeing the cost rising of customer acquisition in the traditional sense and creating really rich content. It's the only way to do that. So we're diving in right at the intersection with what we're doing at The Fascination and that's where we saw it going. And that's why I think we're bullish on where we're headed.

Stephanie:

Yeah. Well, it'll also be interesting to do a recap episode on what's happened since some of these brands got into mixing media with commerce. I mean, I'm thinking about NBC, I think did a whole shoppable TV thing. And I remember seeing them launch that maybe in February or April last year, but I don't know what actually happened. So it'd be fun to do a recap of like, here's who launched in 2020 when it came to mixing media and commerce and here is status update.

Matthew:

Hopefully we will be one of the givers.

Stephanie:

Yeah. Hopefully. What's one thing from 2020 that you hope sticks around in 2021?

Matthew:

I think that we've all had to embrace things like this, just getting on video conferences, not having to present ourselves through this façade, in the office I would have never thought about wearing my hat backwards and rolling around in athleisure. And now that's just the norm for everybody. And kids are on work calls and it's just, the whole thing feels a lot more familial. And even if we do go back to offices, I really have loved that work now feels a little bit closer to home because you're in your home, but also because just the interactions, you see more than you would if everyone was in an office environment.

Stephanie:

Yeah, I agree. And I think it definitely brings a more human perspective too. Like you're saying, working together, knowing someone's kids, seeing them in the background, and then you also have more, I guess, empathy when a mom or dad's like, "Hey, I got to go do this with my kids." It's like, "Oh yeah, I saw your kid connection." Of course you can, whereas I'd say prior to this. Yeah. Not as much of a leniency, I guess for that. Yeah. That's a good one.

Stephanie:

What is the funniest story or best story you can think of when it comes to either building up Leesa or building up The Fascination where you're like, "Oh, this is a good time or a good story that really sticks in my brain from those years."

Matthew:

We've done so many like gimmicky things at Leesa. We were growth hacking like crazy and we were throwing stuff against the wall and not all of it stuck. We did a ton of stuff with Barstool Sports. We maybe did a few influencer integrations that wouldn't go over so well today with certain influencers.

Stephanie:

And with Barstool, I feel like they're so edgy that they can get you in trouble all these days anyways.

Matthew:

They're very edgy and we purposely like with all of those podcasters and creators, we're like, go be very authentic. And so you can't tell Barstool like, tame it down and not be authentic. But they were a huge converter for Leesa for several years.

Stephanie:

That's fun.

Matthew:

So we did a lot of fun stuff. We sponsored Larry at the gambling goldfish, which was a gold fish swimming around in a tank on Barstool sets, they pulled a mattress behind a truck with a Santa Claus riding on it. But we've also done a lot more admirable things, like we did a sleep out for the homeless. We've done a lot of cool things at Leesa just in the experientials side of things that made it fun.

Stephanie:

Yeah. I mean I have a love for the gambling goldfish. I want to go check that out. That actually sounds pretty funny.

Matthew:

Yeah. One more thing that we did is I think it was the 2017 NFL Draft, it's shown on ESPN and all the players are interviewed in their homes. And so we sent the players that we knew would be interviewed on TV, on ESPN Leesa mattresses. And we had them put their Leesa mattress boxes behind them and their families. And we got millions of impressions that night because we had Leesa mattresses all over the air on ESPN Draft.

Stephanie:

Oh, that's fun. See, I love creative stuff like that, where I mean, as long as it actually converts too, I always have the question about TV, does it actually convert or what happened after everyone saw the mattress behind them? Did you guys see a big uptick in sales, or?

Matthew:

I don't remember if we did or not. I think we saw a bit of an uptick, but I mean, it was such a low cost stunt to do that. It wasn't a swing for the fences, but we also did a ton of TV in heyday at Leesa. And you can really see the brand awareness effects the TV has even though it's insanely hard to track.

Stephanie:

Yeah. I agree. What is next on your reading list?

Matthew:

I'm probably going to do Shoe Dog by Phil Knight.

Stephanie:

Such a good one. I love that book. Yeah. So inspirational. I highly recommend. If you were to have a podcast, what would it be about and who would your first guest be?

Matthew:

Well, that's an interesting question because we may very well have one soon.

Stephanie:

Oh, nice.

Matthew:

Yeah, I don't know in what format it will be. It may be a podcast. It may just be like Instagram TV stories, but we really want to interview, just do flash interviews with our brand founders, asking about their origin story, asking about what makes their products different, fun facts. And I think a groundswell of really interesting stories like that would be fun.

Stephanie:

Cool. That sounds good. And then the last one, what's the nicest thing anyone's ever done for you?

Matthew:

Oh, that's tough. I mean, I there's been so many instances of generosity. I think honestly, giving me a chance to make the career switch that I did, and this is a bit of a shout out to David my co-founder, but he really took a chance on me. He's been super supportive of me for years, and it's really gotten me to where I am today in terms of my career and the place that we're at collectively. So him and the people around me that pushed me to make that leap out of the traditional corporate world of consulting. I was really hesitant to do that coming right out of my MBA and looking at a nice salary, and he was one of those people that pushed me over the top to do that. And I'm thankful for it.

Stephanie:

That's really cool. Great story. All right, Matt. Well, thanks so much for coming on the show. Where can people find out more about you and The Fascination?

Matthew:

So about me, you can find me on Twitter at MattDHayes, all one word, and then The Fascination.com. Go check it out.

Stephanie:

Awesome. Thanks for joining us, Matt.

Matthew:

All right. Thank you.

More Than An Influencer: Turning a Community Into A Company with Deepica Mutyala

info@mission.org (Mission) — Tue, 23 Feb 2021 08:00:00 +0000

You’ve heard it time and time again on this podcast: That influencer marketing not only works, but could be the key to unlocking massive business potential for your eComm business. Influencers have the power to take a product – or an entire brand – from unknown to a trending topic product overnight. And sometimes, the community that they build is so valuable, it creates a jumping off point for a business of their own. That’s what Deepica Mutyala did when she launched LIVE TINTED.

On this episode of Up Next in Commerce, Deepica takes us through how she progressed as an intrapreneur at BirchBox before she took the plunge and set out on her own journey. And it all started after one beauty video that she made went viral on YouTube. Deepica explains how she went about building a community based on a mission to bring more diversity to the industry, and how she’s been able to tap into that community to create content and launch a successful business with products designed specifically for her community. Plus, Deepica reveals some of the advice she got from her investors and mentors like Bobbi Brown and Andy Dunn. Enjoy this episode!

Main Takeaways:

Deprioritize the Big Channels: It’s okay to deprioritize big marketing channels such as Facebook in order to explore and engage with users elsewhere. Facebook will always be there, but you might catch lightning in a bottle if you are willing to adapt and explore new platforms.
It’s Not a Dirty Word: Influencers tend to get a bad rap, but the truth is that anyone can be an influencer, and that influence can be nurtured for the good of a community and a business. By tapping into the power of a community, growth becomes much more attainable.
Start Where You Are: Intrapreneurship is an avenue you hear about less often, but is a strategic way for anyone with bigger dreams to learn the ins and outs of business. By embedding yourself in a business that works, volunteering to help in every department, making connections, and taking all of your learnings to build an initiative internally or on the side, you can advance as a true entrepreneur much faster.
More Than A Check: Fundraising isn’t just about filling your bank account, it’s also about adding to your knowledge bank. Deepica tapped into mentors and investors like Bobbi Brown, Andy Dunn, Payal Kadakiam, Hayley Barna and others to learn from their experiences and invite them to be a part of her own growth. Tune in to the episode to hear some of the advice they each gave to Deepica!

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone, and welcome back to Up Next in Commerce, this is your host, Stephanie Postles, co-founder at mission.org. Today, we're talking to Deepica Mutyala.

Deepica:

There you go, you nailed it.

Stephanie:

The CEO of a beauty brand, LIVE TINTED. Deepica, welcome.

Deepica:

Thanks for having me.

Stephanie:

How many times do people pause when they're like, "I'm about to botch your name, I know it, I know it, ah, there it goes?"

Deepica:

I mean a lot, but I appreciate the pause and effort to get it right, versus just blatant lack of attempt to try and get it right. So, I appreciate you trying. Thank you.

Stephanie:

Good. Yeah, thanks.

Stephanie:

So, I was doing a bit of research, as I always do on my guests, and I'm fascinated by LIVE TINTED. I mean, you have such a great story, so much stuff [inaudible] want to dive into, but first, I think it'd be fun to kind of talk through how you got here, your background, What did you do before you founded LIVE TINTED?

Deepica:

Yeah. So, I actually started my career on the corporate side of the beauty industry. In college, my first internship was at L'Oreal in New York, and post-college I had a brief stint at Limited Brands, which is now L Brands at Victoria's Secret, which is no longer there because they went bankrupt. So, I was there for a brief stint, but the whole goal and end game was to one day create my own beauty brand. I was that 16 year old girl who grew up in Sugar Land, Texas who said that... I was going to change the narrative of what I saw when I was going down the beauty aisles.

Deepica:

When I was a kid, I shopped at Walmart predominantly, honestly, that's where I shopped for beauty because, going to shop for beauty wasn't really a thing in my family's life, so when we were just getting groceries at Walmart, I would divert to the aisles and go look at makeup. And I would find myself not reflected in the ads, and I would also not see any foundation shades that worked for my skin tone. And I literally, remember telling my family at 16 that I was going to change that narrative one day, and everything I've done for my career since that point was to get me to starting LIVE TINTED.

Deepica:

So, it's kind of crazy being now back in Texas, like I was telling you earlier, that it's just really full circle being here, and finding doodles of me writing out what I thought my brand name was going to be, and talking to family members who are like, "It's just crazy that you're actually doing it." Because this is what I wanted to do. So then, after nine months at Limited Brands, I quit my job to take a risk on a startup called Birchbox, which at the time was the hottest tech company... Not even just beauty, but I think overarching, they created a whole category of subscription model that really created a whole new category.

Deepica:

And so, that was really cool, incredible experience working for two bad-ass female founders who, in my parents' eyes, were really okay with me working there, and taking a pay cut, and going for my dream, because the two founders went to HBS.

Stephanie:

Oh my gosh.

Deepica:

And so, they were like-

Stephanie:

I also read the quote from your... You were saying, "Oh, my dad all growing up would hand me a stethoscope," and then you would instead grab lipstick or something, and I thought that was really funny.

Deepica:

[crosstalk]. Yeah. It's kind of an Indian tradition where... There's this ceremony that happens... I think it's after your first 100 days, and we just did it for my nephew, where they put things in front of you [inaudible] like a book versus different things to see what you would gravitate towards. And instead of me gravitating towards anything that was in front of me, I was grabbing my mom's lipstick in her [crosstalk].

Stephanie:

In the purse digging over there.

Deepica:

Yeah, yeah, which is so funny, and crazy, and full circle now, but yeah, this was always the dream, and it's wild for me to look back and reflect. But I worked at Birchbox, and in true startup culture, you can create opportunities for yourself at a startup. And so, I made it very clear to the founders that I wanted to one day create my own beauty brand, and they gave me opportunities in the company to do that. Then, I had to do it a lot of the times, in my free time, it wasn't like... I still had to do my day job, but if there was projects that I could work on in my free time, I did it, because I saw it as Birchbox was my business school.

Deepica:

And they always said it as founders, right? But I truly felt it. I really felt like working there was an incredible network of really smart people, and I got to... Literally, you have an idea, you can test it, and just go for it. And so, I got to work on product development at Birchbox. I got to work on influencer partnerships at Birchbox. And when I did that, was my first time being like, "What is going on in this influencer world? And how much are these girls getting paid? What is happening?" Some random girl at Iowa getting paid this insane amount of money to do a YouTube video, and I was just like, "This is wild."

Deepica:

So, as I was doing that, was when I realized there was nobody who looked like me on YouTube creating content, and I kind of just saw it as a fun hobby. I was like, "You know what, Deepica? At the end of the day, you're not quitting your job, just do it on your weekends. And at the end of the day, all the people in your life that text you questions about makeup and things like that, you can just say, 'Go to my channel, stop texting me.'" So, really, I didn't think much of it. And so, January of 2015, I picked up my iPhone... Because again, I didn't know what I was doing video content wise, I had no clue how to... Ad revenue wasn't even activated. I didn't know.

Deepica:

And I picked up my iPhone and held it vertically instead of horizontally. The production, it was like I knew IGTV was happening before IGTV was happening. I did it in a vertical mode, and I used red lipstick under my eyes to mask dark circles... And people who are hearing this are probably literally so confused, but-

Stephanie:

I read that too, I was like, "Well, it'd be funny if I showed up with red lipstick under my eyes."

Deepica:

Oh my God, that would have been awesome. Yeah, no, I used red lipstick under my eyes to hide dark circles, and I guess that was crazy to 10 million people, because that video went viral, and yeah, has millions and millions of views.

Stephanie:

And it worked. For anyone who's like, "What did that look like?" I looked at the pictures and the video, it actually works.

Deepica:

Yeah. So, here's the deal, I basically... That was my biggest beauty concern my whole life, how to hide my dark circles? And it wasn't talked about, people didn't talk about it because it's such a specific problem to specific communities of people. And so, I just did the video that I had learned when I was on set one day, where a makeup artist was using a color corrector under my eyes, an actual product made for under your eyes, and I was like, "What are you doing putting red lipstick under my eyes." And she was like, "Oh no, it's a color corrector, it cancels out the darkness, so when you put on your foundation, you really can mask your dark circles, because you have extra pigments that require kind of additional correction." And I was like, "Well, what's the difference?"

Deepica:

My brain is always thinking about hacks and simplifying things, and so that doesn't change with my beauty routine. I want to always simplify things. And so, she basically, said, "Not much." And so, I filmed this video and it went viral, and when the video was at 4 million views, I got a call from the Today Show to come on to do the segment on air, and I quit my job that day. I kind of just had this moment of, this could be a cool 15 minutes of fame, or I could turn it into my dream career. [crosstalk].

Stephanie:

That's amazing. What did the founders say? Because I'm guessing, you had a pretty close relationship with them. I mean, they were letting you essentially, be an intrapreneur within their organization, and test things, and learn, and try, how did they feel about that? Because I saw that they were some of your first investors along with Bobbi Brown, which I'm like, "What? How did you get in front of her?" So, what was that process like leaving and getting them to invest afterwards?

Deepica:

Yeah, it was really tough. There's two co-founders, and they just had different mindsets, right? One of them was more like, "You are all on a Birch tree, and you're all acorns that will fall into the world." I remember she said... And she's the one that's currently an investor in my company, "I want to see you grow and thrive." And the other one, it's not to say that she didn't want the same thing, but she was really excited about me growing within the company. And listen, she had every reason to feel that way. She helped me get so many opportunities within the company to be able to create what I have been able to do today, and she gave me those opportunities, but it was more like... I was really close to her too, I worked more with her directly. So, of course, it was like one of those bittersweet things, but they're both incredible and really supportive.

Deepica:

But it was really scary to... I remember when I got... The day I got the email from the Today Show was when I pulled her into a room that day at 6:00 PM, towards the end of the day, and I just was like, "I feel like I have to go for it." And she gave me a really big hug and said, "She's really happy for me." But you could tell it was like a bittersweet thing, which I appreciated, because at the end of the day, that means she felt that I made an impact at the company.

Stephanie:

That's great. So, what was the Today Show like? Did you go on there and do a tutorial? Tell me a bit about that.

Deepica:

Oh my gosh, it was wild. So, my sister came on and was my model on air. So, she flew in from Texas. My dad was backstage sitting next to Kid Rock, which was hilarious. Picture this immigrant Indian dad who's like, "What is even happening? My daughter is on national television. And who is this guy with a beard and long hair, what's going on?" It was the moment where I realized that I was meant to do exactly what I'm doing in that moment. I was not nervous, I felt like that was... I was just meant to be there, it just felt that way. You know that Eminem song... What is it? Lose Yourself? You get one shot, one opportunity. I was listening to that backstage, and I literally felt like I had four minutes on national television to show people that a brown girl can do this.

Stephanie:

Mm-hmm (affirmative) Oh, that's great.

Deepica:

Yeah. I felt like I could be the Indian Hoda, and just be the next news anchor on the Today Show. I still feel like... I love doing live television, I think it's like... There is a beauty in the imperfections that come with it. And it was surreal, is what the word is, and incredible. And I remember after it was over... The hustle and bustle of live television is very real. The second the segment is over, they're like, boom, boom, boom, moving onto the next thing. And I was like, "That was so fun, let's do it again." Most people were just like, "All right, lady, we're moving on." But then, there was this senior producer who came up to me and she was like, "You should do it again."

Deepica:

And I was [inaudible] around, and it's so cool because my dad is in the background recording it, so I have all this on camera. But she just was like, "We can't believe it was your first time doing national television, we'd love to have you back regularly." And that was really cool for me, because everyone told me that when you go on national television, it's a cool moment in your life and you move on, and I feel like I proved the exact opposite, that if you have what it takes, you can make things happen for yourself. So, I became a regular doing beauty segments on the Today Show, and was a full-time influencer, which is a thing.

Stephanie:

Yeah, I saw that. That was one of the first things when I was looking into your bio a bit, and it's like, "Oh, Deepica is an influencer, and I think she's just signed a deal with WME." I'm like, "Oh." So, tell me, now you've got the status, and you're super popular, how did you think about capitalizing on that, and to get out of just being an influencer, and then being like, "I'm going to create my own stuff?"

Deepica:

Yeah. Well, here's the deal [inaudible] I never grew up saying I wanted to be an influencer or even be famous, but I did grow up saying I wanted to be a CEO and run my own business. And so, when you fall into something like this, it's very weird. But I think what got me through the years where I was just an influencer and didn't have the business side of it was, the end goal was the same. I wanted to change the face of representation for people who look like me, period. So whether that's in the media, or through my own beauty brand, the net goal was the same, and it still is the same.

Deepica:

And so, what I realized was, I had this opportunity to create a brand around myself that was really once in a lifetime, honestly. And I was just like, "I want to focus in on this and really learn everything I can about the beauty industry." Which at this point, I knew a decent amount. I worked at Birchbox, I had a lot of beauty brand contacts. And really, what I did was, after I quit my job, I emailed all my contacts and I was pretending to be my own assistant, and I was like, "Hello, I'm the assistant to Deepica Mutyala, beauty influencer with 10 million views, Today Show beauty expert, blah, blah, blah, blah, blah, blah, if you want to work with her, whatever."

Deepica:

And for every 100 emails I sent, I got one reply, and that one reply led to my first job where they asked me my rate, and I had no idea what to say. And then, when they said, "Okay," I realized, damn it, I could have asked for triple. You just learn as you go, and you're your own assistant, producer, editor, manager, agent, sometimes lawyer, which I don't recommend.

Stephanie:

Nope.

Deepica:

I'm like, "Bad idea."

Stephanie:

Yeah.

Deepica:

But you just learn as you go. And so, I think for me, what got me through being the girl who was waking up and taking selfies, and posting it for literally a career, I got paid to do that, was that I really saw a narrative in the beauty industry that didn't exist when I was growing up. There was no token brown girl, there was always... And even then, there wasn't really a token black girl growing up, that was still in the... Now, I feel like we're finally... It still has so, so much work to do, but I do think that we now have representation happening more than I ever saw growing up, but there still is this tokenism that happens where... I felt like for three years, as grateful as I am, that I've been able to work with every beauty brand under the sun, like a L'Oreal commercial to a Samsung ad that aired during the Golden Globes, and just any beauty brand I could have dreamt of.

Deepica:

I also realized there's plenty of people out there that deserve the shot to also do that, and there shouldn't just be one of me. There is not just one white girl on the campaign, why shouldn't there be more brown girls in the campaign, more black girls in the campaign? That experience as an influencer is what led me to launching LIVE TINTED as a community platform prior to launching the actual product itself. I didn't plan for that, again, being a community brand wasn't a thing growing up either, but it was lived in experience that truly inspired the idea that, before this launches with a physical product, let's create this united community where they dictate our future decisions.

Deepica:

And really, for me, honestly, I was craving a home where people were talking about things in the beauty industry that was not a thing, heavy topics like colorism. But then, other topics like facial hair, and things that you just didn't say. And so, we created this almost like collective home where every day we were just posting about faces that I felt like you didn't traditionally see being shown in campaigns. And it just started to organically grow into this very, very engaged community, which then at a point, I was like, "Let's create products for them, it's time." And that's kind of what led to our first product launch in may of 2019.

Stephanie:

Yeah. We had a really cool company on... Food52, same thing, they build up a huge community first, and then, afterwards, she was like, "Oh, it was only right to then start creating products to service that community." But my biggest question is always like, how did you build that community? How did you transfer the audience from TV to then go into your community? Or from Instagram, or YouTube, or wherever you were, how did you pull them in and get them engaging in a way where you're like, "They're here for the long haul and now I can move on to phase two of a product?"

Deepica:

Yeah, no, it's a good question. I think for me, I feel very grateful that those three years as an influencer, I created a community of people who felt very connected to me, because again, there wasn't a lot of brown girls doing this. And so, I felt like they would be ride or die for anything I put out into the world. But that is, to me, a huge responsibility, and it was like, "Okay, so now, if I create this brand, I don't want it to be about me, I want it to be about something so much bigger than myself."

Deepica:

So, if I had just launched it, which a lot of investors in the beginning were saying to me like, "Why do you have to create this community first and spend money on creating content as a community platform and things? You already have a following, create a product, show proof of concept, and build it out." I just didn't listen, and I felt really strongly that LIVE TINTED was bigger than my own identity, it was about a larger multicultural group of individuals coming together and finding common ground in industry where I felt like people were so divisive.

Deepica:

And so, I really wanted to kind of bridge that gap and create a really powerful, I think, warm home for people. Which, I think, a lot of brands are saying they're doing now, and it's awesome, right? I'm not hating, I think it's all for the greater good. But people are smart, and they can understand when some people are being performative versus not. And I feel very grateful that since day one, we've had values and core beliefs that we've... Of course, they evolve, but the core belief around diversity and inclusion is the pillar that has stood strong since the beginning.

Deepica:

And so, for me, on an actual tactical level, the first 20,000 followers, I would say, came directly from my following, from... I remember before we even launched it, I was trying to find photos of deeper skin brown women online, and it was virtually impossible. I was just searching and the team was searching, and I was like, "You know what? Let's use the power of social media." And I just posted on my Instagram, "I'm working on a project on stories, if you see any deeper skin melanated brown women, use #livetinted." I'm not even kidding, within minutes, the #livetinted was flooded with just tags. It was just like this community of women who have been thriving to be seen. They are just craving for this industry, who has neglected them, to pay attention to them.

Deepica:

So, when you ask, how I did it, sure, my following definitely helped do it, but what really did it was that there was just a natural need. These people didn't have another home, and they were excited to finally have it. And so, I also think that it grew from just being a South Asian Brown collective to being much larger. Because again, I talked about topics that were very specific to me and my life. I didn't force it and try to speak to something that I didn't know personally. And with that, I recognized colorism is not an issue in just the South Asian community. To be honest, I'm learning so much as we build this brand that... I had no idea, this is something that so many different cultural backgrounds face around the world.

Deepica:

And that actually, excited me, because I realized that there is an opportunity to create a brand with pillars that, like I said, unite people from all different cultural backgrounds rather than divide. And so, it just organically grew from there, just by talking about things that I lived in and experienced in my life.

Stephanie:

Yeah. That's very cool. So, how many people are in your community now?

Deepica:

Well, it's a tricky number, because I say 600,000 because I include my community as well. Because quite honestly, my whole brand has shifted to just LIVE TINTED stuff, Which I love. Yeah, we're a little over 600,000.

Stephanie:

Cool. And how do you think about keeping them engaged on the different channels? What are you doing now that's maybe different than when you started out in what? 2015, 2017?

Deepica:

I mean, yeah, because my brand started in 2015, and then LIVE TINTED started in 2018. But you have to evolve with the times. Perfect example is, hello, TikTok.

Stephanie:

Yeah. Actually, my favorite influencer is an Indian girl on there with her dad.

Deepica:

Oh yeah, she's amazing. I love her.

Stephanie:

What's her name?

Deepica:

Sheena? Is it Sheena? It's starts with an S.

Stephanie:

Yeah. She's so funny. But you never see her dad, it's always just his responses to things that she's doing. I've never seen her dad anyways in any of her videos. But she's my favorite. She's hilarious.

Deepica:

I'm obsessed with her. And yeah, I feel like there's this understood brown community bond where you're rooting for each other, because it's like, so many of us were told to be doctors and go down this traditional path. Yeah. One of my goals for the brand is to spotlight not your traditional beauty influencers, but people like her who are just creative creators. I think there's this incredible creative community that I've come across just from building LIVE TINTED that deserves so much spotlight. We have big plans to only continue to spotlight them in a bigger way as the brand continues to grow, Which I'm excited about. What was your question, again?

Stephanie:

[inaudible] Yeah. Okay. So, [inaudible] I like to derail things every once in a while, but back to saying... You said you had to change with the times, from what you used to do to what you do now, and you said, of course, TikTok, what are you doing today to keep your audience engaged? And how do you think about treating the different platforms different, [crosstalk] people right now are connecting with them best?

Deepica:

Well, I think, first and foremost, I don't try to pretend like I know something that I don't know. And so, luckily, at this stage in the business, bringing in an intern that's in college that can do TikTok for us, because I'm like, "Wait, what is this dance move? What's going on?" So, I think hiring subject matter experts is something that I feel like, finally, oh my gosh, because I've been just doing everything for the longest time that now, it's like, let's hire for people to do what they're good at.

Deepica:

But of course, you have to have a pulse and know what to even hire for, right? It's like, am I looking for an email expert? You have an X amount of budget, if you're going to focus in on email versus... Social versus paid versus all these other marketing levers, you know what makes sense? For example, for us, influencer is such a critical part of the business, because a lot of them are my personal relationships, but we need to continue to grow that network to the people... Just like the girl you just mentioned, there's a whole community of people that are continuing to create and build every year, and so, for me, it's about staying on the pulse and making sure you feel comfortable evolving with the times.

Deepica:

Facebook is still a powerful, powerful sales channel, for sure. And so, we do need to be relevant on there. But if you're a small team, and you have to pick and choose your efforts, for us, it's been deprioritized, and eventually, we'll get back there. But I'm way excited about LIVE TINTED impacting the next generation and helping them be a more tinted future, where everyone sees beyond the hues of their skin.

Deepica:

And so, I get really excited about tapping into a younger audience because they are the future of this entire industry, than going towards maybe an older audience. So, these to me, are just the little things you have to keep your mind on, what is your goals? What is the audience you think that you can really tap into? And what are they doing? And then, you decide your marketing leverage based on that.

Stephanie:

Yup. So, how are you thinking about tapping into TikTok then? I mean, you're mentioning partnering with an influencer who isn't a beauty influencer, but could still probably drive results. And I know earlier you said influencers, and you kind of cringed too in thinking about that. So, tell me a bit about, how do you partner with them? Does it work? How do you make sure that it works? All the details behind them.

Deepica:

Yeah. I cringed because I feel like the word influencer has been so like... It's been created into this like comedic relief for people, and I think that's what makes me cringe. But one thing that I feel really, really strongly about, is the value of these creators. I think of them as creatives that are just really changing the landscape of marketing. And I think that it's just the word influencer used to really make me cringe because I felt like it wasn't respected. And as somebody who went through being an influencer, and I still am an influencer, at the end of the day, [inaudible]... By the way, something people forget is influencers have always existed, they were just called celebrities before.

Deepica:

The definition is evolving and changing, and it's going to continue to evolve and change. If you have a platform and an audience, you are an influencer, you have an influence of some sort. And I think it's actually a really powerful thing, if you think about it, because it makes you realize, anyone can be an influencer, and it makes people empowered to use their voice. But the part that I get really excited about, like I said earlier, was this creative community, and how we can work with them. The same way I told you, these girls were just wanting to be seen. These creatives are just wanting to be seen, and they've never been given the opportunity to be seen. So, how is it that LIVE TINTED as a brand can tap into these people, and really invest time and effort as an internal team to search for these people, and work with them, and not go against the grain, and go against who everyone else is wanting to work with?

Deepica:

Listen, we're still a small company, so paid partnerships is something that I can't wait to be able to do. It's like, are you kidding? I went through it, I want to be able to do it for other people. So, we're working on trying to grow those relationships now. So, when we have a full budget in place, we support these, I would say, underdogs, versus going towards the people that everyone else was going to, because that's no fun.

Stephanie:

Yeah. And I mean, that's a big theme that I'm hearing too, is finding more of the micro-influencers who have a very engaged following, but they might only have a few thousand followers, versus a million, but those few thousand are ready to convert and really buy the products, and do the things that you're doing. How do you go about finding those people? I mean, it seems hard to have to go through TikTok and Instagram, and find people that might not show up on your feed right away, if you are kind of searching through all that.

Deepica:

Well, there's a lot of cool tools now that we've actually just invested in, which... Honestly, for me, my plan was to do it the old school way, of just investing the time, finding people, and I think, that to me, was the way to go, but there's supplemental tools, like there's this new platform... I sure don't know if it's new, it's new for us, called GRIN. And it's a way to manage your influencer partnerships and relationships, so you can actually have data and analytics to back up why you're doing certain decisions. And it's like, traditionally, in PR, you send products out, you hope somebody posts about it, who knows if they do? Tracking that is really... It's just a lot, so you need to have the manpower to be able to do it.

Deepica:

And now there's these tools in place that make it a little bit more scalable, which is really great. But I don't think anything can beat the just human aspect of finding a gem of a person and saying, "This is who I want to grow with." And I now, luckily, now that there's a team in place, I can spend my time doing those things, because, first of all, I truly believe that is the special sauce that comes from a brand, is those little efforts you put in that take time, that really set you apart from the others out there. I don't want to be the person who partners with the biggest TikToker, and not just because of the financial reason, which I think... I don't want to speak for other people, but I think a lot of times, the theme is to go to micro or nano influencers because of budget reasons. And to me, it's really exciting that they're untapped, and have a voice, that they're... You just want to continue to empower that voice, I guess.

Stephanie:

Yep. Yeah. I love that. So, how do you think about strategic partnerships, or when it comes to when you're getting investors? I mean, I'm thinking, okay, you have Bobbi Brown who is very big in the makeup space, what did that look like? Did you have that in mind when you partnered with her, like, "Oh, maybe you can kind of showcase my line along with your brand?" How does that work? And how did you think about picking strategic investors instead of just going with the first person who might give you money?

Deepica:

Yeah. That's actually exactly what happened too. So, I learned so much through my fundraising process, so it was my first time doing it, and what I came out of it realizing was, nothing is more valuable than experience, and that includes a cheque. I think I was taking people's cheque, but really, what I was taking was their experience, that's what I wanted to learn from.

Deepica:

And so, I had a couple term sheets where it was like one large cheque from one VC... Which, by the way, that whole process is a whole thing in itself. But I feel grateful to say that... I actually don't feel like I had as much trouble being a woman of color getting investors on board as much as I think I've heard a lot of my other girlfriends who are women of color, specifically, black women, which is just all sorts of messed up in its own, that... I feel very, honestly, grateful that I didn't go through that, but I also think it's really messed up that I didn't go through that as much. But that process has taught me so much in what I want to do in my future of... There's so much I want LIVE TINTED to do to help other women who want to create their own brands. But when I went through that process, I was like, "Wow, I really don't want one person this early in my business to dictate my decision-making."

Stephanie:

Yup.

Deepica:

You're learning so much in the beginning, and the last thing you want is for someone who knows nothing about your business, who just gave you a cheque, to say, "You need to go into this retailer, or you need to do this partnership, or grow this, or hire this person." So, instead, what I did was tap into a network of people who I worked my off to build my entire career, and tell them, "I'm launching my own brand, and you've been somebody who has been a mentor in my life in some capacity." And really positioned it as an opportunity to be a part of the growth of what I'm building. And I feel very confident about that. I still feel that way. I know and I feel very competent about what I'm building, and what the impact it's going to have on the world.

Deepica:

And so, I went to all of these mentors or just advisors in my life, and they put in more angel cheques, strategic angel cheques, really, just to get their advice. I'm learning from their mistakes. Andy Dunn from Bonobos, the other day, I sent my annual investor update, and he was like, "Just continue to focus on profitability, don't overspend on marketing, learn from my mistakes." I'm learning from all of their mistakes. Payal Kadakia from ClassPass, she would say, "Focus on your why, don't ever get distracted from the why." And Bobbi Brown, she was the first to tell me, "Go on a motherfucking date." That's what she told me to do. She literally, told me to go on it, and she used that word. So, that's why I said that, I apologize [crosstalk].

Stephanie:

That's okay.

Deepica:

But that's Bobbi for you. She is such a dope woman. She is no BS. She told me, she was like, "At the end of the day, you will succeed because that's who you are, but you don't want to look back and wonder, what was it all for if you don't have someone to share it with?" And so, maybe that's a part of the reason I came back to Texas, and I'm kind of taking a step back and zooming in on things. But they all give me different advice for their own nuggets of what they went through. And Hayley Barna from Birchbox, is now a partner at First Round Capital, she put in a personal cheque, and I feel like I could always call her to ask her about fundraising advice, because they've obviously raised so much money.

Deepica:

It's just truly invaluable to be able to talk to people who've gone through the mistakes and the wringer to say, "I'm thinking about [inaudible]..." I'll give you an example right now. Food52, I love what they're doing. You mentioned them earlier, I love what they're doing. I love the idea of a collective ecommerce shop where you're creating content to commerce. I think it's really smart. And I've gotten distracted in the past of wanting LIVE TINTED to also be that as a collective home for inclusive beauty. I wanted to create the next sephora.com that truly zoomed in and focused in on, you won't be on our site unless you are caring about inclusivity. That doesn't mean you have to be a POC owned brand, we will absolutely prioritize it more than most people do, but I had this vision.

Deepica:

And at the end of the day, I think the biggest, hardest thing for founders to remember is to stay focused, eye on the prize, and I think... That doesn't mean I don't want to still do it one day, but we have way too much momentum happening as a singular brand that I think I just have to stay focused. And these kinds of founders in my life, if I called them, and I'm like, "But what if we, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah." They will all pull me back and say, "All in good time, young grasshopper." [crosstalk].

Stephanie:

That's awesome. And I mean, that is the time when a lot of founders do kind of want to start seeing profit, want to go big, want to experiment a bunch of different areas, and I think that's really smart. And I also love Bobbi Brown's advice too. I mean, I love the personal aspect when you find people like that.

Deepica:

Another thing, on the Bobbi Brown thing, her specifically, we met through the DM.

Stephanie:

That's great.

Deepica:

Yeah. You can connect with anyone in the world, you have no clue what the power of social media... There's so much negative that comes with it, but there's so much positive. And I remember on my launch day, I was in New York City doing a ton of press, and I went to Jersey to meet with Bobbi Brown in person, and she was like, "Wait, your launch day is today, and you're here?" And I was like, "Yeah, you're Bobbi Brown." [crosstalk].

Stephanie:

I'm here.

Deepica:

Yes, of course, I'm here. Because to me, she was doing inclusive beauty before inclusive beauty was inclusive beauty. And as a Jewish woman who grew up in New York, I just find it to be so impressive that she recognized that... She sees it as like... Obviously, I care about making sure that everyone feels represented, that's how she sees it, and I feel like I wanted to learn from that person. I want to create my own Bobbi Brown cosmetics one day, and I feel like with her guidance, I'm well on my way.

Stephanie:

Yeah. That's cool. So, I mean, you have a lot of good mentors and investors. I mean, Andy Dunn is another good one. He actually was our first investor in our company too-

Deepica:

Oh, wow.

Stephanie:

[inaudible]. So, good people you got there. What is something that they're guiding you on right now for 2021? How are they kind of... I mean, Andy has Walmart, but he got to look at... He has a lot of things that he can see around ecommerce at Walmart. What are people like that saying right now? Like, "Hey, Deepica, you need to start preparing for this. Or we're seeing this shift at our company, so maybe you need to kind of pivot, or adjust, or do something different to be ready for this new world." Anything high level like that?

Deepica:

I think the biggest theme and general advice, is slow and steady growth for the win. And that's very different from what I was told when I was first fundraising in 2018, it was all about the next billion dollar unicorn company. And I have a couple of people who were unicorn companies, Payal Kadakia as an investor, and it's like, they are all also advising me like, "Just don't get caught up in the noise, don't get caught up in the quick turnaround story." And the more I'm seeing what's happening in this bubble, that's kind of bursting, it's like, "I'm so happy that we didn't take on a ton of funding, we're growing slow." And I'm going through the fundraising process right now for our Series A, and the reality is that we don't need to fundraise right now. It's this back and forth of like, we're doing really well and we can go really slow.

Deepica:

But at the same time, like you said, Andy is with Walmart, and one thing we're exploring right now is retail partnerships. And so, one thing that I think is very apparent now is, it's a very different ecommerce and D2C climate than it was five years ago, as we know. And I think the idea of being omni-channel, it's not an option. We have to be omni-channel to also beyond just like the business and the metrics, because myself being, again, that 16 year old girl who dreamt of having her own beauty brand, it's about impact too. And I want my physical products to be able to be touched and held by people who are in store. And again, go down those beauty aisles and actually see yourself represented. And I feel like we're the brand that needs to do that in a big way.

Stephanie:

Yes. Beauty feels hard to me though from ecommerce. I mean, I'm just thinking about... I went to Tarte, which is of course, a beauty website, and I was ordering things on there, and it still feels so hard to figure out what you need to buy based on your skin tone. And it's asking me all these crazy questions, which you're probably like, "Yeah, those are obvious ones." Like, do you have a pink with a yellow undertone there?

Deepica:

Undertone.

Stephanie:

I'm like, "I..." And it literally has 50 options, and I'm like, "I don't know, am I pink? Am I yellow? Am I green? I'm not really sure." So, beauty feels hard. I mean, I know obviously, being in retail, being in person is important, but during this time right now, where that's been a little bit harder, how did you think about adapting your ecommerce experience in a way that people could know what they wanted, or what was meant for their skin? It just feels so hard.

Deepica:

And it is really hard. That's totally true. We're actually going through a site revamp right now, and it's all going to focus on community, which I know is such a buzz word. But the best thing we can do is tap into all these people who, again, have been just dying to be seen and be featured. And they're not like the person with all this following, whatever, this massive following. And to me, what we can do is... The best marketing tool we have is them, and see them, the product, have them create the content, have them be the things we feature on our website, so people like you can go directly to the site and see themselves and say, "Oh, well, I look like her." It just helps.

Deepica:

I think Rent the Runway is the first example I saw of a company that... I remember shopping it and picking a dress, because I saw girls who had my body type, and I was like, "Oh, well, she..." All the reviews, I think it was [inaudible] that they used on their website that is really great customer review experience. And I remember when we created livetinted.com, I wanted to use [inaudible]. So, we do for our review system, because I wanted it to feel really real, a yelp kind of situation where you're truly feeling like you trust that person telling you which product works for you.

Deepica:

So, it's tough, but there's tools and ways to make it better. And I think just leaning into people and humans, and having them be a part of the experience, and creating a really strong customer service experience so they want to meet that review, is all important.

Stephanie:

Yeah, that's great. I also think that technology is evolving to a place now where... You should be able to have your face in front of your camera, and take a picture, and then be like, "Here's exactly what would go best with your skin tone or something."

Deepica:

It's getting there, and there's apps and stuff too where you can do that, but lighting is such a factor. We're getting there, but with beauty, it is tricky. And I think all the tools I've seen this far, none of them have worked for me. That was one of the business ideas I wanted to do in college, I was like, "It's just too hard to shop for beauty online." We'll get there though.

Stephanie:

Yep, I think so, too. All right. So, let's shift over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question, and you have a minute or less to answer. Are you ready?

Deepica:

Yeah, sure. Okay.

Stephanie:

All right. What one thing will have the biggest impact on ecommerce in the next year?

Deepica:

I would say new ways of leaning into people and community. Yeah. I just said that, but we're currently revamping our ecommerce site, and the biggest thing we're focusing it on is people and experience, and tapping into the human aspect of what people are looking for when they're buying something, which is as emotional as a color corrector to solve their dark circle issues. And so, I think if you continue to focus in on people, community, how they can drive purchase decisions, you'll thrive in the ecommerce world, especially in beauty where things are very... You want to see yourself reflected.

Stephanie:

Yep. I love that. What's the nicest thing anyone's ever done for you?

Deepica:

Wow. Is this personal or business? I mean-

Stephanie:

Whatever comes to mind, whatever you want.

Deepica:

This is the first thing that comes to mind, because we just talked about it. You should always value every person you meet in life, because you never know where it's going to lead, and come back, and connect, and help you in the future because... I didn't work directly with Hayley at Birchbox, but when I quit my job for her to... She introduced me to XFactor Ventures, which is our first VC that came on board, that gave us our first cheque, which then created a ripple effect that made other people think we were legit, that created another ripple effect. And I think that confidence in somebody who only... I worked with her but at a very bird's eye view and stuff, and so it's kind of like... I'm so grateful for that. And not just her, just generally, I think, when I think about the people who have taken the bet on me, I think it really makes me feel like I'm here for a reason, and I have shit to get done.

Stephanie:

Yep. That's great. What ecommerce tool are you most excited about right now?

Deepica:

Right now, it's GRIN, that's the one that we're literally doing trainings on right now. We're really trying to optimize. I think the influencer partnership space is something everyone's trying to figure out and find a way to scale, and I'm hoping and hopeful that GRIN can help us do that.

Stephanie:

Yeah. Wow, that's awesome. We will check that out also. If you were to have a podcast, what would it be about? And who would your first guest be?

Deepica:

Well, I'm working on getting this started, but it's going to be... It will be called Hue To Know, which was... Instead of [inaudible] To Know, Hue To Know.

Stephanie:

Yeah. I like that. That's cute.

Deepica:

And we had a whole video series for LIVE TINTED when we were just a community platform, where we interviewed people, they came on, and they talked about their identity and culture, and it was all these... To me, they were dope creatives, again, people that you should know about that you may not, like a black Muslim rapper, or a gender nonconforming South Asian artist. And these people who were like, "I'm going against the grain and creating a path for myself, and living tinted." That's really, to me, what that means, and what LIVE TINTED stands for. So, I want to bring them on as a guest, and create it into a podcast form. And my first dream guest would be Meghan Markle, because I think she's incredible.

Stephanie:

That sounds great. Well, if you need help getting off the ground, you know who to call.

Deepica:

Great. Okay. Cool. Yeah.

Stephanie:

All right. And then, the last one, what is your favorite business book where you often go back and think about it, or read quotes from it, or whatever it may be?

Deepica:

Man, I wish I had it so I could show it to you right now. This was a pile recommendation. It's called Financial-something, Financial Terms... Financial... I'm going to have to find it and send it to you.

Stephanie:

[crosstalk].

Deepica:

Yeah. But she told me... Before you go into fundraising process, as a person who's never done it before, there's a lot of terms that get thrown around, like convertible notes, and cap tables, and all this stuff. I didn't know what I was doing, so she was like, "It's going to feel like you're reading a dictionary, and it's going to be dense, but you want to be able to walk into those meetings with full confidence, and I highly recommend that you read it." And so, I have to look for the book and find the name. There's a lot of different terms in there, so I'm blanking on the title itself.

Stephanie:

Yeah. I think there's a good book that it reminds me of called Venture Deals by... I think it's Brad Feld-

Deepica:

That's what it was.

Stephanie:

Oh, is that what it is?

Deepica:

Damn it, it was Venture Deals. You're right. Yes. Yes.

Stephanie:

Okay. Well, [inaudible] because I'm like, "That's a good one too." Where I remember-

Deepica:

That was it.

Stephanie:

... when we were thinking about raising money, I'm like, "All these terms, I don't know what they are. Pre-money, post money, cap table. Oh my God, what are we talking about?" So, that's a good book for anyone raising money right now.

Deepica:

That was it. Mm-hmm (affirmative).

Stephanie:

Awesome. Well, thanks so much-

Deepica:

[crosstalk] But it's a good book, but yeah.

Stephanie:

Yeah, yeah, yeah. It's a good book. And then, after you read it, you're like, "Okay, I'm done with that for a while." Awesome. Well, thank you so much for joining the show. It was so fun having you on. Where can people find out more about you and your work?

Deepica:

Well, I'm obviously, going to plug LIVE TINTED first. LIVE TINTED is L-I-V-E T-I-N-T-E-D, livetinted.com. @livetinted all on social. And then, you can also follow me at @deepica, D-E-E-P-I-C-A on all social outlets.

Stephanie:

Amazing. Thanks so much.

Deepica:

Thank you for having me.

The Death of the Category: Winning on Amazon and other Ecommerce Marketplaces

info@mission.org (Mission) — Thu, 18 Feb 2021 08:00:00 +0000

What if we told you that you may be approaching Amazon in all the wrong ways? Many brands, especially more established ones who started out in brick and mortar, have been playing a game of catch up while trying to quickly figure out how to sell on Amazon and win. But it may feel like a confusing place to win. Especially if a brand is trying to apply a brick and mortar sales approach, like winning a category, to online platforms like Amazon, Target, or Walmart.

But we all love a good underdog story, which is why we invited Andrea Leigh to the show to share her secrets.

Andrea is the VP of Strategy & Insights at Ideoclick, a full-service ecommerce optimization platform. Before Ideoclick, she spent nearly a decade working for Amazon, so she is coming to the table with a true insider’s view and strategies in her back pocket that she’s seen work on Amazon and other marketplaces.

In this interview, which was one of my favorites I’ve ever done so far this year, Andrea and I discuss why brands need to accept the death of the category and start thinking about how to stand out against an entire competitive set. Doing that means repositioning your brand and winning the share of search, it means optimizing for SEO, and it also means going back to the basics of differentiation so that you’re not just another option in a sea of products that look exactly the same. Plus, we talk about selling across multiple ecommerce platforms, and how to think about Amazon releasing “white label” product lines. I hope you enjoy this discussion as much as we did!

Main Takeaways:

Category Chaos: Brick-and-mortar shopping lends itself to categorization, but in the world of ecommerce, particularly on Amazon, categories are not something brands should focus on. Customers shopping online are fed suggestions based on their entire history of shopping, so when they search for something like peanut butter, they don’t just see Jif and Skippy, they see that and then anything peanut butter adjacent that might resonate with them even a tiny bit. With this in mind, brands need to figure out how to compete in entire segments, rather than specific categories.
One Metric To Rule Them All: Share of search is one of the best metrics an ecommerce brand can look at to measure everything from how customers are finding them, to what the customer experience is when they search for something, to who the competition is in their set.
Mining For Gold: One of the places that Amazon has excelled is aggregating consumer complaints, and then coming out with an Amazon Basics product that addresses all of them, which then becomes a top-seller. CPG brands large and small should be employing a similar approach. And, they should be highlighting the bells and whistles of their product that separates them from the white-label product that any marketplace offers because that is what differentiates you from the mass amount of search results a consumer will be combing through.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey, everyone. And welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder and CEO at Mission.org. Today on the show, we have Andrea Leigh, the VP of strategy and insights at Ideoclick. Andrea, welcome.

Andrea:

Thanks for having me. I'm excited to be here.

Stephanie:

I'm excited to have you on too. I was looking through your bio and I saw that you were at Amazon for almost a decade, and I'm sure you have some good juicy stories from that those 10 years.

Andrea:

I do. It was a wild, wild ride. I think when I started, I was employee 4,012 or something like that, and then when I left, 99.9% of the company had started working there after me, so I was literally a dinosaur. Yeah.

Stephanie:

Oh my gosh. That's amazing. So what were, high level, some of the things that you did at Amazon and are any of those things still relevant today?

Andrea:

Yeah, I think they're super relevant. I spent my entire career there working on their ecommerce business, and everything from the early days of helping launch their price matching software, the software they use to price-match other retailers. I worked on Harry Potter book launches back when print books were the only way to read books. We also had some things that we did with Oprah's Book Club. I worked on the launch of the grocery category on Amazon.com, and the Fulfilled by Amazon program there, helped launch the baby registry and built the baby category after Amazon severed ties with Babies R Us.

Andrea:

I was general manager for Amazon Fresh for a little while. At my last three years there, probably the most exciting, I moved onto our Canada business and I launched 15 product categories for Amazon Canada. I ran the Prime program up there, and then I also managed our transportation network. And that was probably my most exciting role because it was certainly cross functional. But I think the common thread is, and probably why I liked Canada so much in the later years was just, I really, really enjoy working with the manufacturer community.

Andrea:

I think that the process that they go through to really understand the customer, to build products, to address customer needs, and then to figure out how to connect consumers to the values that they've built in their products, I think is just really exciting, and figuring out how to do that online is even more exciting. Certainly, in the early years of Amazon, we spent a lot of time working with brand manufacturers and partnering with them because we weren't very big back then and we were really trying to get these categories built and to get customers shopping online for things besides books.

Andrea:

And I found that to be really enjoyable because every manufacturer has a unique set of challenges. It's like a puzzle to be and to collaborate on. And that's still what I get a chance to do today at Ideoclick and really, really enjoy that process of helping manufacturers solve those puzzles. And we certainly don't have all the answers, but I think it's a similar process to go through with each manufacturer to identify where they are on their ecommerce journey, and then help them figure out how they're going to build a sustainable business.

Stephanie:

That's awesome. So tell me a bit about Ideoclick. How did you think about creating Ideoclick? And what is it? What does it do? How does it help companies?

Andrea:

Yeah. We're an ecommerce optimization platform, and we're a hybrid of a software solution and a services organization. And my husband actually started Ideoclick about 13 years ago. We were both working at Amazon together at the time, he left and started Ideoclick and I stayed at Amazon for 10 more years. And I joined up with him about, it was probably like four or five years ago now, to help him run Ideoclick. And really, it came from the same place that I was talking about earlier, really wanting to work more closely with the manufacturers, help them figure out how to navigate Amazon.

Andrea:

As Amazon became bigger and bigger, not only did it become more important to the manufacturers' business, but it started to become a little unwieldily in terms of how to be successful, how to make sure your products stand out, and how to negotiate and operate. With such a big player, that's so unique and looks so different from brick and mortar, which is what most manufacturers have been really accustomed to for so many years. And so Ideoclick was really born out of that to help manufacturers navigate these waters. And we are a full service, white glove providers.

Andrea:

So we do everything from setting up the items in the digital catalog, writing content, running all of the automated advertising on Amazon, Walmart, Target and Instacart, and also going back and assisting with operations, managing the chargebacks and fees that the retailers often slap on the manufacturers and recovering some of those fees. So we're a full service agency, we're in a category called managed services.

Stephanie:

Got it. So what are some of the biggest maybe missteps that manufacturers or sellers are making on the platform where you're like, "I've got all these secrets from an exec at Amazon that I know how to prevent that or why you shouldn't be doing that." What kind of things are you preventing from happening when you're working with them?

Andrea:

Yeah. I think my answer would have been really different a couple of years ago, especially COVID impact on ecommerce. Amazon's not the only game in town anymore, and these other platforms, more specifically Walmart and Target, but if you look category by category, they're a becoming a really big player in each space, whether it's Wayfair for furniture, or Sephora and ULTA for beauty, or Chewy for pets, there's a player there that's starting to represent a sizeable portion of the business. So a couple of years ago, I would've said getting these Amazon foundational things right is the most important and it's the biggest misstep.

Andrea:

But I think now we would say not having a strategy across all of these eCom players is a real big misstep, and shooting from the hip, because I think we're in a world where these retailers are in fierce competition with one another, they're price-matching each other, they're very closely watching what one another is doing. And you don't want the customer to suffer as a result of that. And so having a strategy that does things like differentiating assortment or helps you figure out how you're going to allocate your ad budgets, now that all these platforms have ad platforms associated with them as well.

Andrea:

I think that shooting from the hip is probably the most common misstep that we see. But I think some of the same things still hold true from several years ago, which is just getting those foundational elements right. There's certainly little tricks you can do and little black hat tactics that will get you some more reviews real quick or help you get to the top of search. We don't focus on that stuff, it's not sustainable, most of it's against Amazon's policies. So it's really about making sure your products are in stock, making sure you have the correct information on your product pages, making sure that you've got resources internally within your organization to support ecommerce and to drive it, making sure that you have good SEO and you're making use of the ad platform in appropriate ways.

Stephanie:

So now that you just mentioned SEO, I do want to talk a bit about categories. I know that you've been on, maybe a brand or whatever it may be for a while around like, categories aren't the way forward anymore, and that you really need to optimize for search, just like you would anywhere else. So tell me a little bit about how ecommerce owners should think about that going forward. Why is Amazon not as focused on categories anymore? Or maybe the buyer's not focused there?

Andrea:

Yeah, I think it really starts with the customer, and the customer not being as focused on categories. I can tell a little story that might help illustrate it. We had a manufacturer come to us and say, "I'm like the number two or three bottled water brand in the world, and so I should be number two in my category on Amazon." And there are a number of reasons why that thinking is a little bit out of date or flawed. When a customer goes to Amazon and searches for bottled water, they don't just see bottled water, they see tea and electrolyte water and powdered electrolytes for water and ice, flavored water, and all kinds of things that are category adjacent. But they may also see things that are out of category.

Andrea:

Peanut butter is another great example. If you search peanut butter on Amazon, you're going to get some peanut butter, you're going to get peanut butter crackers, you're going to get peanut butter bars. And it's not because like Amazon is not thoughtful about deciding what to return in those search results, for example, they're returning those products because those are the products customers are buying. Their algorithms are very, very smart. And even from an advertising perspective, you can't win those ad slots unless there's a history of customers making that search and buying your product.

Andrea:

And so the concept of a brick and mortar category totally makes sense if a customer is going to a store, they're going down an aisle, they're presented with bottled water, they choose from what's available to them, and then they move on to shop at a different category. But eCom customers don't shop that way, the category is dynamic, it's continually evolving, shaped around that customer. And what they've specifically looked at when retailers are using automation and personalization. And so you can't really apply that same mental model to ecommerce. You have to really think about that entire competitive set.

Andrea:

And so that manufacturer who thought he should be number two or number three bottled water brand his competitors on Amazon, aren't just bottled water, as we stated, they're tea and they're electrolyte water and all kinds of other things. So his competitive set is different, but also because ecommerce platforms and more specifically, Amazon, has frictionless entry, so any manufacturer can sell on Amazon, the competitive set is going to look a lot different than in a brick and mortar store where you have like a buyer making assortment decisions.

Andrea:

So, whereas there might be five or 10 nationally recognized brands in a brick and mortar store and maybe a couple of local players and private label, on Amazon, there is a huge long tail of brands that are not nationally distributed, maybe only sell on Amazon so that competitive set looks entirely different. And I think that's a big misstep that manufacturers make, is applying that same mental model, trying to look at like market share and category and ranking category, versus moving their thinking to the ecommerce world where there's really no such thing as a category.

Stephanie:

Yeah. The only time I can see categories being helpful is if you're in the browsing mood where you're like, I'm going to be having a baby, and I just want to see, what do you buy for babies? So like if you're in that browsing mood, which maybe isn't always high intent to buy, more just kind of looking around and maybe you buy, or if it's a curated category, like here's the guest for Father's Day. I have found those helpful where I'm like, I don't know what to get my dad, and on the homepage, it's like, "Here's a whole... " Maybe it's not a category, but the whole curated collection, pick one and go.

Andrea:

And that's where I think some of these category specific players win over Amazon. They do encourage more browsing because they are curated assortment, because their browse and data are really clean, and it's a more enjoyable experience. But if yo did try to shop by category on Amazon, the data shows that more than 90% of customers just go and start searching, you would maybe not like what you found. It's an overwhelming experience, it's not curated in any way. And then the categorization data is bad because Amazon doesn't use it. They're building a search platform more than they are building a browse platform. And I do think these other eCom players, this is where they can win over Amazon, is they make the shopping experience more enjoyable, they encourage browse, and they curate the assortment.

Stephanie:

Yeah. We just had on a company called The Fascination. It was about discovering new D2C companies and being able to browse around. But once again, that's highly curated versus just going to a category and being like, "Whoa, let's see what's here today. Oh, there's like 1,000 things. No, thanks." So if we're in a search world now, where you need to optimize for that instead of just worrying about being the number two water bottle, showing up in the category, how should a brand be thinking about that? How do you optimize for search? Are you bidding on keywords? Do you have to use just Amazon platform? Or is it more of like a holistic approach of like, you got to have a good product, you have to have good reviews, and all encompassing?

Andrea:

Well, certainly it's a whole package deal. There's not like one thing that drives all of the success. But I do think that really understanding that customer and the process we go through at Ideoclick and manufacturers could go through a similar process on their own is we identify these customer search groups. Identify the customer that you're going after and the product that meets their needs. And then from there, what are all of the search terms that customer might search when they're looking for that product? And then bouncing that against if there's any search philosophy. Amazon publishes that data, so it's knowable to know if a search actually has any volume associated with it. And then that's your customer search group. And then we're able to measure progress on achieving placement in search on that customer search group relative to the competition. So the way that we're doing that is, in a brick and mortar world, this would be like market share.

Andrea:

Like you'd say, "What are my sales over the entire category sales?" And in ecommerce what we do is share of search search. So we say, "What are all of my positions within those first 20, 30 search results relative to the entire set?" And obviously, there's some weighting associated with that, because like if you're up on top, that's more valuable, drives more sales than if you're like down at the bottom or the customer has to scroll a lot on their phones. So measuring that share of search for your customer search group relative to the competition.

Andrea:

And it does a couple of things that I think are a lot better than a brick and mortar market share model. The first is it very quickly identifies who your competitors are. So if you didn't know which... Most manufacturers don't know who their Amazon competitors are, and that's because manufacturers, when they're checking on their products on Amazon, tend to search for their brand name. So of course you're going to get your products. But if you take a step back and instead of searching for your branded facial moisturizer, you search for face moisturizer, you're going to see an entirely different picture of who's turning up.

Andrea:

And so this allows you to really measure your percentage of that customer experience, essentially, going back to the customer. And in addition, it gives you more of an upstream look at what's about to happen. So market share is, it already happened, your sales occurred and now you're measuring as a percentage of a total. This allows you to affect what's going to happen in the future, so it's an upstream, maybe an input metric versus an output metric. And then lastly, the share of search is measuring like a finite amount of the first or second page, which is really, as far as the customer is typically going on like a basic search...

Andrea:

And that looks a lot different in terms of number of brands than what you might see in like a finite category on a brick and mortar shelf. So there may be more brands, more types of categories represented, and measuring that as the percentage of a customer experience really allows you to develop some advanced strategies against those competitors.

Stephanie:

Is Amazon providing the tools so you can see your share of search, or are you doing this for your customers? Or if I was by myself trying to be like, "Who are my competitors?" Would I be going through the first three pages and being like, "Here they are? How do I figure out that share of search?

Andrea:

Yeah, it's really tricky. So we have software that does it for us, and share a search is our proprietary offering that we provide to our clients. But it wouldn't be hard to do a very simplistic view of this, which is identify like five terms that you think matter for your product, run a search and count how many of the first page you have. It's not a difficult activity. To get more nuanced about it and track it over time and track all the competitors and all of that, obviously you need some software, but you can do a really simplistic look. And this is often what we do for a manufacturer who is considering working with us, we'll take a look, we'll do a quick share of search audit and do exactly that exercise.

Andrea:

What are the five terms that we think matter? How much of the page they have, and who else is showing up? And you can really quickly see how you fair relative to those competitors, not just in the position of search, but like how many reviews do you have versus the competition? What's your star rating? What's your price point look like? What is your packaging look like? It's a very fast view of how you compare in this marketplace. And there are some really aggressive brands out there. We have clients that come to us and they say, "I'm private equity backed, I am a new go-to-market brand," no one has ever heard of them, "I have no distribution, and I want to get distribution in Costco next year, in a year. What is your plan for me?"

Andrea:

And we have a program for that. It involves a really, really large marketing investment. But but that's what these traditional manufacturers are up against, are these really upstart brands that are doing pure play Amazon and really trying to make a presence for themselves. And while they feel like ankle biters when you're just looking at the Amazon search results, next year when they are in Costco, they're no longer ankle biters.

Stephanie:

Yeah. Which is what's great about it. How do you think about when someone comes to you and says they want to be in Costco... I mean, I've read amazing articles about how Costco will make sure that your product... Like their product always has to be slightly better, but they'll also still work with you to make sure that your yours is selling as well. So one example was like Starbucks. They made sure that their coffee, Costco brand, Kirkland brand was a little bit better than Starbucks based off whatever criteria, but then they also made sure that Starbucks was also being sold, or whatever the brand name was, in a way that it wasn't cannibalizing.

Stephanie:

But Amazon feels a little bit different when they come out with white label versions of things. You see that, and you're like, "Oh crap. There goes my products."

Andrea:

Look out.

Stephanie:

Yeah. That's the one thing that I think sellers are scared of now, is Amazon just copying you? How do you deal with them?

Andrea:

Well, I think you touched on a couple of things. The first is the beauty of a value-added retailer like Costco for a manufacturer. In that model, in the value-added retailer model, the retailer takes responsibility for the inventory, for the promotion, for making sure it sells, for the profitability, for curation, deciding what the product should be. All of that happens on the retailer side. And that's true across traditional retail, whether you're talking about an ULTA or a Nordstrom or whomever, they own that responsibility. In marketplaces, the responsibility is all shifted back to the manufacturer, so they decide what assortment they're going to carry, they decide how they're going to price it, they have to promote it and market it. And it's a really different model.

Andrea:

So I think that's one interesting thing about what you were talking about, is that Costco does that. And when retailers complain about Amazon or say how much of their business Amazon's stealing, I think it's important to remember they're there to lean into their strengths, which is providing this value add for these manufacturers and reducing a lot of that burden, and usually, producing a higher profit margin for that manufacturer because they don't have to take on all of that work themselves. On the private label front, it's really interesting what Amazon's doing there. Some of the categories like consumables are getting up to about 10% of the sales being Amazon private label, which is really... And fashion, I think, was maybe even higher than that.

Andrea:

As a part of Amazon's antitrust hearings, they had to release that data and you have to dig around to find it, but it shares the percentage of each category sales that are driven by Amazon private label. It's really interesting. And manufacturers will often come to us and they'll say, "Oh my gosh, my life is over. Amazon just launched a private label in my category." But I think really, it's an opportunity for the manufacturer to really be more on their toes. And a great example of that is, if you take a look at Amazon Basics, they have a luggage spinner. And if you search luggage spinner, suitcase, or whatever, you see Amazon Basics and you see Samsonite and a bunch of others.

Andrea:

And the Basics, it's like a third of the price and it looks just the same. And I think what's really interesting here is that Samsonite has an opportunity. If you actually click through to the product pages, you still can't really see a difference. But as a part of an article I was writing, I then went to the Samsonite manufacturer site and actually specked out what's really different about it, and there were enormous differences. It was like a TSA compatible lock, it had all of these extra features that weren't even coming through on the product page, that certainly weren't coming through in the title and the search results and the hero image.

Andrea:

And so I think Amazon is going to usually come in at this lower price point and this more value driven offering. And for these manufacturers who have better bells and whistles on their products, talk about them. I mean, it's classic differentiation stuff, just the way you differentiate looks a lot different in an ecommerce marketplace. Like you have to do it through the images and you have to make sure that the bullet points really display that, you have to have a title that calls out something about the feature that's really unique. I do think Amazon's seeing a lot of success with their private label because they are able to leverage their own platform and they know it best.

Andrea:

But through share of search, we've also identified enormous holes in their strategy from a marketing perspective, like entire categories of keywords they aren't bidding on, and then you can get really granular and really go after those holes that Amazon's left wide open. And I think it's because I think the reason Amazon has those holes is they're using an algorithm to drive their private label. It's not people back there saying, "Okay, we got to bid on these five keywords. These are the ones that matter, and here are the features that everyone cares about." And then I think if you don't have a point of differentiation against Amazon's private label, it's time to take a real hard look at your product, because if it's that copyable, it's not just Amazon private label that can copy it.

Andrea:

But also, if you often look at the differences between the top selling product in the category... Soup's a great example, you can search chicken noodle soup on Amazon, and Amazon has totally innovated the packaging and the format of the product to address all of the customer complaints. Canned soup is terrible online, it dents. No one really likes to eat anything out of a can anyway. So Campbell Soup showing the can traditional format, you look at Amazon's chicken noodle soup, it comes in a reclosable box, which is one of the top complaints in the reviews about the Campbell Soup, which is like, "I can only eat half of it. And then what do I do with it?"

Andrea:

It ships in its own container, so they're all nicely tightly packaged into a box so it doesn't dent or get damaged in the shipping. It's way more profitable for both the retailer and the manufacturer. So I think there are some areas where Amazon's really innovated on the behalf of the customer and it should be keeping manufacturers on their toes.

Stephanie:

Yeah. That's such a great point. So many things to unravel there, thinking about, you need to be different and leaning into your differences. And the whole point of having a product is to have a great story and showcase your features and don't get complacent. I love that. I could see even being able to look through the data and find opportunities, just like Amazon is, of like going through reviews and seeing what is someone complaining about? Oh, so many people keep talking about this, creating a whole spin off product, I guess Amazon could do the same, but it seems like there's a lot of opportunity in the data that's already there too.

Andrea:

There is. And I think this is one area that large established CPGs really struggle, and it's because they have so many brands and they carry so many products. If you're a nutrition bar and you only have 20 items on Amazon and you're growing really fast, it's really easy for you to look through the reviews on your 20 items and come to develop some insights and say, "Okay five people are complaining that they think it's a little bit too sweet, or 10 don't like the sugar content," or whatever. And you can re adjust your product in your next product development cycle. But if you're a large established CPG working across so many brands, so many different categories, I did my air quotes there.

Andrea:

But if you're a large established consumer brand, maybe you've got 1,500, 2,500, 5,000 items, there's no scalable way to do that right now. And I think that's an excellent business opportunity for someone to get into, which is like really analyzing some of that consumer feedback. I actually just had an MBA student from Northwestern reach out to me through a connection wanting to talk about like that very business idea. She's like, "What about all the customer reviews? Who's got data, that's mining that?" And I'm like, "No one." There are some players out there like Reviewbox and I think Profitero, and maybe even Salsify to some degree that allow you to access them, because Amazon doesn't even provide them, you have to just look at them, and develop some basic insights and maybe some word clouds and things like that.

Andrea:

But there's so much more to be gained from those reviews that would really help inform product development.

Stephanie:

We've even heard from so many of our guests talking about the long tail reviews or where the insights are. I think we had someone from HP and then Stitch Fix, of course, talking about like, that's the ones that you need to dive into to see... If someone's providing paragraphs of data to tell you how to make your product better, you better be looking at that and seeing, are enough people saying that? To pivot whatever product you're working on.

Andrea:

Yeah. You really need some natural language processing technology to really make the most of those reviews. But either Amazon has it or they're just really good at it, because if you look at... I could give so many examples of this, but if you search short-sleeve wrap dress, they have an Amazon Basics, it's a top seller, I even have it. It's a great dress.

Stephanie:

How did they stick that one up?

Andrea:

And relative to like the top three other results, I mean, you go through the negatives on the other top three results, and it's like, "It's too short, so it's not work appropriate. It doesn't wrap enough to be able to sit down in it well enough at work. It doesn't come and extended sizes." Those were the top three complaints. And Amazons comes out with an offering that's more conservative, slightly longer, comes in extended size. It immediately just addressed all of the things, all of the negative reviews about the other top three sellers. They've either got something that's helping them do that, or they're just really good at it.

Stephanie:

Yeah. But I think that also just plays to the point of needing to be diversified and beyond all the platforms. I look at Walmart right now and so many influencers are showing me stuff from Walmart, I'm just even thinking... I've bought rugs in the past month, I bought an egg chair from Walmart, all because these influencers are talking about stuff at Walmart, which also I think has increased quality a lot, and they are becoming a larger player. Maybe their tech and backend still needs a little bit of work and out of stock issues and all that, but I do see them coming up strong. Target also. How do you advise the companies you work with to think about all the platforms and be on all of them and optimize for each one in a unique way?

Andrea:

Yeah. And I think that's really the million-dollar question, because up until a couple of years ago, those other eCom platforms didn't really matter as much, up until last year, they didn't even have ad platforms. The world is moving and changing so quickly. I actually was just giving an internal speech right before this to our employee base and I was like, "Retail, if you really go back, is meant to be a really simple business. It's, a manufacturer has a product, they sell it to the retailer, and the retailer resells it." And the people who grew up with that model, it's relatively uncomplex or simple process. But if you just look at what's happened over the last five years, even five years ago, you had to be advertising on Amazon and search engines like Google and maybe even Facebook at that time.

Andrea:

Now, there's social live streaming, there's social media networks, and you have retailer ad platforms. The level of complexity that these manufacturers are faced with right now, and if you think about the ones who lived through all of this, they weren't attracted to this field because it was a technology field, they were attracted to this field because it was really based in sales and product. And so the level of complexity that they are faced with is an enormous. And I was in a share group the other day where a manufacturer called the...

Andrea:

In our space, we're like the service providers, it's super fragmented, it's a ton of point solutions that help these manufacturers be successful across all these different platforms. He called it a Frankenstein, and this company that was presenting at the share group was working with 35 different service providers from data and analytics to execution, to strategy and execution and strategies, where we set to operations and EDI and inventory management, and how do you allocate inventory across all these platforms. So there's certainly no perfect answer to how do you think across the different eCom platforms, but I do think it's important to really think about, where's your customer?

Andrea:

Is your customer shopping on Walmart, Target and Amazon? And most of them are because most of them are cross shopping. Where else is your customer shopping? What category specific players should be really important to you? And then where are you most profitable? And where can you get a good ROI? And what platform do you use for what? For Target, it's a little bit more about that curated assortment being on trend with merchandise and being associated with, Target gives your brand a little bit of a boost.

Andrea:

Walmart stands more for value, Amazon is about assortment, and obviously, price and all of that, but I think really aligning yourself with the marketplaces that are core to your brand's identity feels really important. So the customer, what's consistent with your brand, and then in terms of the investments to make across them. A lot of the fundamentals are pretty similar, so that's good, you have to have those, you have to be retail ready. And the ad platforms are similar, but different in very important ways. And so I think when you think about how to allocate those investments, then it really comes down to profit and what you're trying to accomplish, if it's awareness, if it's maintaining your position in the market, whatever it is.

Stephanie:

Yeah. I always think about the opportunity that exists for manufacturers of creating a piece of tech that allows them to plug in all the inputs that they have to deal with, even when I'm having companies come on and say, "Oh, we feature D2C companies on our website and they have a backend place to log on." And like, okay, that's one place. Then they're on Amazon and then they're on Walmart, and they're trying to figure out their own inventory stuff. There's so much stuff for them to keep track of that it feels like there's no unifying source right now for them to be able to get a holistic picture of their company as a whole.

Andrea:

In fact, I got this urgent call yesterday from this guy, this colleague of mine that I've worked with in the past, and he's teaching a course at Harvard right now called The Future Of Work in one of the courses. And he called me yesterday, he's like, "Okay, I'm preparing for this thing, I'm making a deck, I'm showing this crazy environment that we're in with all these providers and all these different things that these manufacturers have to keep track of." He's like, "Who are the service providers who can help them unify it?" And I was like, "There aren't any. It's not because you didn't look hard enough, it doesn't exist."

Stephanie:

I always think like, "Who is out there?" I even asked an exec, I'm like, "What do you do?" And they're like, "Oh, it's just hard." I'm like, "Someone needs to solve this."

Andrea:

Someone needs to solve it. It would be a really big job, but even just take like logistics like 3PLs. So you can outsource your warehousing and your purchase order fulfillment either direct to customer or to retailers to a three PL. I just did this as a part of an industry trends report. There are tons of 3PLs 70 some percent of them have fewer than five customers each. So it is a super fragmented industry. It's so fragmented in fact that the new trend is a 4PL. And a 4PL is a broker that helps you manage all your 3PLs.

Stephanie:

I have not heard about that yet.

Andrea:

Isn't that crazy? That's like a new cottage industry, is 4PLs, and that's the broker that helps you manage across the other PLs, I guess the other 3PLs. And that's just in logistics. So it's a really challenging space and I think what ends up happening, the ones that end up suffering... Right now, I think the manufacturers are suffering because all of this complexity deteriorates their profit margins. And then they also have to advertise on the reseller platforms now too, which is new, and pay and pay for that. But I think in the future, eventually, if no one figures this out, the customer's going to have to pay for it because the prices are going to go up.

Andrea:

The manufacturers can't shift from 5% of their business online to 50% of their business online, which is a much lower margin business for them and not raise their product costs. I just don't see how that happens. So hopefully, someone will figure it out.

Stephanie:

Yeah. Do you see any manufacturers doing it well right now where you're like, "Oh, I just talk with someone and they are doing it this way," that seems like it's streamlining at least a piece of the process. It might not be all of it, but any stories there that highlight someone doing something really good?

Andrea:

I think there are a few folks who are doing a really nice job designing for online. So that's first and foremost, make the packaging and products such that it's low weight and it ships economically, because that's number one. If you can't do that, if you're trying to still try to sell dry bags of conventional dog food or cat litter online, you have no future in that. And so we've certainly seen like Clorox do some really interesting things in the litter space, Purina36:10 they're doing lightweight litter. There's some great examples of companies designing for online.

Andrea:

So, how do you build a sustainably ecommerce business? Well, make sure that it can ship well or the retailers aren't going to want it, and you don't have a future in it. So I think there's some good examples of that. Clorox is also doing, they did a green works product a while back that instead of selling three bottles of spray cleaner, there's one bottle with two tiny concentrate refills, so it's less water, it's less waste, it's more sustainable packaging. I'm certainly seeing some really cool stuff from some upstart brands. There's one called Ethique, which does shampoo and conditioner bars.

Andrea:

That's, again, less weight, ships really well, online store as well, it doesn't leak. And then we're certainly seeing a lot with Liquid I.V. and all of the electrolyte powder drinks. So moving from selling it as a bottle that has water in it that you can't ship to powder. So some interesting stuff on designing for online. I think there are some companies who do a really nice job like aligning their org structures to support ecommerce. I think some good examples of that would probably be, L'Oreal does a really nice job there, P&G has a pretty solid and smart eCom department.

Andrea:

There are a few CPGs who do a really good job there. And then I think the one that everyone seems to struggle with those logistics, especially the larger CPGs, they're built to scale products and ship truckloads and not necessarily fill direct customer orders or ship like super small quantities to all these little Amazon warehouses. So I think logistics is really been hard on the CPG industry, ecommerce logistics.

Stephanie:

Yeah. I only see it getting harder and worse. I'm thinking about my interview with Domm from Fast, and him talking about one click checkout where they'll batch the orders on the backend for you buy, buy, buy all in separate transactions, but that's still also encouraging one-off orders that maybe you wouldn't have had otherwise that maybe brands aren't used to, someone just coming in and buying one shampoo or something because normally they have limits. So I only see it getting more difficult as technology gets better and they figure out how to make things easier to buy, it just makes it harder logistically.

Andrea:

Yeah. And I'm starting to see, I just feel like ecommerce retailers have gone I've really come a long way on this in the last couple of years probably to compete with Amazon, but I can't remember which retailer said, he was Wayfair, I was shopping on the other day. And they suggest that, they're like, "Batch my orders, you can select it. It's like defaults to batch my orders, so they all show up on one day or you can check the other boxes, no ship them each as they become available. And Amazon has been also doing that because in ecommerce, at least on the Amazon, the average order's one.

Stephanie:

Yeah. And I think that's what Domm said that Amazon's been doing this for a long time, it's that most ecommerce companies aren't doing that. So that's why on Amazon, you can always go and hit, buy now, buy now, buy now, and you don't even think.

Andrea:

And they'll try and batch it.

Stephanie:

They'll try and figure it out, but you don't even have to worry about a cart anymore. And that seems to be the way of the future, but I'm just thinking about these smaller brands who are trying to, up and coming, trying to get their foothold and then be like, "Oh my gosh, customers are expecting to be able to just hit, click buy for one thing, and I wasn't prepared for that."

Andrea:

I think we're going to continue to see... We'll certainly continue to see Amazon grow, they had an amazing quarter, but also I think we'll continue to see customers really being less loyal. And I think that because these other retailers are really upping their game. And if you look at, there was a study that came out that showed the top reseller app downloads in 2020, Walmart was right there under Amazon. And granted Amazon is a huge in-store base, so we need to take it with a grain of salt. Wayfair was on there, Wish, all these other retailers.

Andrea:

And so I think the pandemic has forced us all to shop more online, but also due to product availability, shop more across retailers. And as a result, we have discovered that the shopping experiences on some of these other retailers sites are more favorable to the types of products we're looking for. Maybe even more fun or more curated or whatever it is that you're looking for, and I think the retailers are starting to figure out how to be more efficient with batching orders or, remember when you used to have to go get your credit card every time you placed an order online?

Andrea:

They're all saving it now, I mean, stuff that we take for granted because Amazon set a really high bar.

Stephanie:

Yep. I love that. I know we don't have a ton of time, so I want a quick touch on Bezos. I know he just recently stepped down as CEO from Amazon, so I want to hear your hot take on what does that look like for Amazon of the future? How do you see that changing things?

Andrea:

Yeah. Well, first I should probably say, I don't know, Jeff personally, and I don't have any inside information. I've been gone from Amazon for five or six years now, but I do think if I were him and knowing what I know about him as the fearless leader, he's an inventor, that's what he's really good at, he's really good at inventing and disrupting industries and inventing on behalf of the customer experience. And when I look at what he has really had to focus his energy on the last couple of years, even pre-COVID, you had the antitrust investigation, they were under intense scrutiny for their treatment of their warehouse workers, counterfeits on the site and fake reviews, labor unionization efforts, here in Seattle, they've been under just a ton of intense pressure for contributing significantly to local elections.

Andrea:

Our local government put in place a headcount tax just to stick it to Amazon. And it's been really intense here, and also a lot of discussion about their role in increasing housing prices and driving the Seattle's homelessness epidemic. The stuff that he's had to deal with, a super public divorce, all of that stuff. And then you layer in COVID and all of the operational complexity of that that he had to deal with, nothing in there is inventing. And if I were him, I would not only be exhausted because I think the best way to exhaust an inventor is to tax them with a bunch of drama.

Andrea:

And so if I were him, I would be exhausted, and I'd be really bored, there's no inventing in there anywhere. They've made some really interesting inventions, I guess, disruptions more, I think of them less as inventions, more of disruptions as it relates to transportation. And in the earnings call yesterday, they said half of their packages now are being delivered by their own fleet. Incredible. They are a huge transportation company now, and they'll probably license that out and just walk out, but there's not a lot of inventing happening now, it's all about scaling, managing under scrutiny and really going head to head against some super fierce competition for ad dollars and for customers.

Andrea:

And so if I were Jeff, I'd be looking at the future and I would just be like, "Not interested, if I were an inventor and I was Jeff. So I think that speaks to why he would step down, I think timing it with going out on the high note with the Q4 earnings being just astoundingly positive probably makes sense. It's interesting, I don't know a lot about Jassy, but I think he was the CEO of AWS for a very long time and he's really good at scaling a business and scaling a business against adversity or fierce competition. If you look at what they are up against with Microsoft, and I think they even like filed a lawsuit against for an RFP that they didn't feel like was handled correctly, he really has gone head to head.

Andrea:

And I think that that's maybe signaling that Amazon's going to be a bit more about scaling and more about competing and a little bit less about inventing going forward, which maybe that's the stage that they're in.

Stephanie:

Yeah. Cool. All right. Well, with a couple of minutes left, we have a quick lightning round. Lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask a question, but this time, you only have 30 seconds or less. Usually I get people a minute, but you're so quick, I'm like, you can't have a minute. You get 30 seconds.

Andrea:

I'll do my best.

Stephanie:

All right. What one thing will have the biggest impact on ecommerce in the next year?

Andrea:

I'm going to go logistics. I think the ability for other retailers and D2C to prevail against Amazon or compete effectively with Amazon, is going to be their ability to ship fast and for us to see some consolidation and maturity in that industry.

Stephanie:

Yeah. I love that. If you were to have a podcast, which you're about to, what would it be about and who would your first guest be?

Andrea:

Our podcast that we're going to have is Melissa Burdick of Pacvue, who is a competing agency for us in the ecommerce advertising space, and myself. And we're going to be doing a hot take on ecommerce current events. And my job as VP of strategy is all about staying current on ecommerce trends and news. And it's even hard for me to keep up, there's so much happening right now. And so we wanted to really try to provide a value to the manufacturer community of helping keep them current and tell them what they need to know. And then more importantly, tell them what we think it means for them.

Stephanie:

I love that. I can't wait to listen. What's up next on your reading list?

Andrea:

On my reading list, oh gosh. Well, I guess on my reading list is a lot of research because I'm trying to write a book about eCom.

Stephanie:

You're a busy lady.

Andrea:

I'm a busy lady. I'm trying to write a book about ecommerce and really transitioning our thinking beyond that physical aisle, kind of some of the things that we talked about today. So a lot of my research right now is reading some other pieces of thought leadership around that. And in fact, on my immediate reading list is I need to read a case about Unilever for my class with Harvard on Friday morning, and it's all about Unilever and how they have successfully transitioned to an ecommerce framework and mindset.

Stephanie:

Oh, I could come to your class too, that sounds good. Awesome. And then the last one, one thing do you not understand today that you wish you did?

Andrea:

I don't understand, well, I think a couple of areas, one is that as a manufacturer thinking about when is the right time to invest in the most forward-thinking ecommerce technology, which in my mind right now is live streaming. And I don't know a lot about live streaming, I'm learning more about it, I'm certainly watching some of it and trying to participate in it. So nascent here in the United States, but in China, it is incredibly powerful. And in this Harvard class, they had a woman who's a super influencer in China comes to the class and she live-streamed in the class and she was selling Harvard t-shirts, and I think she sold, I don't want to say like hundreds or thousands in a minute.

Andrea:

It was insane. And then they projected what was on her phone to the screen and we got to see it. And it really blew my mind that we're in such a different place as it relates to ecommerce. So I don't understand it super well, and I want to understand more of it so we can do a better job of helping our brands transition.

Stephanie:

Yeah. That's a really good one. Definitely one I don't fully understand either, but I know it's very different market there, so maybe people shop differently, but any insights, bring in my way, because I don't get it either. Cool. Well, Andrea, it's been a blast having you on, I hope we can bring you back for round two in the future because I feel like I could probably keep going on for an extra hour if I didn't have a meeting in a couple of minutes, but where can people find out more about you and Ideoclick?

Andrea:

You can follow me on LinkedIn and Twitter, you can visit my website at Andreakleighconsulting.com. I write and speak and post very frequently about ecommerce. And you can find Ideoclick at Ideoclick.com.

Stephanie:

Amazing. Thanks so much for joining us. It was a blast.

Andrea:

Thank you. Thanks for having me.

Standing on the Shoulders of Giants (Like IKEA)

info@mission.org (Mission) — Tue, 16 Feb 2021 08:00:00 +0000

In 2008, the economy had tanked and John McDonald was left at a crossroads. Rather than withdraw into comfort, he took the opportunity to do something a bit crazy. John was a woodworker who spent time at trade shows, and someone once suggested that he make cabinet doors that fit with IKEA cabinets. With nothing to lose, John launched Semihandmade to do just that.

Now, a decade later, Semihandmade has seen consistent double-digit growth year over year and has been featured in countless blogs, interior design social posts, on the feeds of influencers worldwide, and in the homes of tens of thousands of people. On this episode of Up Next in Commerce, John tells the story from start to finish, including how he built a successful ecommerce custom cabinet model on the backs of the IKEA brand, and how he’s now launching into the DTC space with the first US-made custom cabinet DTC offering, BOXI. From finding the right partners, to building an omnichannel approach that doesn’t handcuff your resources, to challenging yourself to strive for more, you’ll learn something from John and his story that just might help you level up your ecommerce business, too.

Main Takeaways:

Perfect Partners: For ecommerce brands taking on an omnichannel approach, there is no reason to tie up a lot of your resources into retail spaces and showrooms. Instead, exploring partnership opportunities with other brands in a similar category might be a mutually beneficial way to expand your brand, the brand you partner with, and offer an in-store experience to customers who seek one.
Meeting the Moment: The world of home furnishings and interior design is changing rapidly, especially as A.I. and VR technology enter the marketplace. With that tech, users are gaining more flexibility to design their own spaces without leaving home, which means there is an opening for DTC companies that are tech-first.
Step Up or Step Out: You can’t let competition scare you, let it inspire you to raise your game. By surrounding yourself with the best and forcing yourself to compete against them, you have to level up to simply survive, and succeed expectations to grow your business in a meaningful way.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey, everyone. Welcome back to Up Next In Commerce. This is your host, Stephanie Postles, Cofounder at Mission.org. Today, I had the pleasure of chatting with John McDonald, the Founder and CEO at Semihandmade and also Boxi. John, welcome.

John:

Thanks for having me. It's great to be here.

Stephanie:

I'm really excited to have you on. Before we get started, I was hoping you could give me a little background, and for anyone who doesn't know what Semihandmade is and also Boxi, how did you start it? What is it? How do I think about it?

John:

Sure. Semihandmade is a company that's been around, I guess, just over 10 years now. We're based in Southern California. We make doors that fit IKEA cabinets. What that means is, if you want to buy a kitchen, bathroom, closet media system, IKEA, for the most part, gives you the amazing flexibility of not buying their doors. For a kitchen, you'd buy the cabinets, you'd buy the interior components. Then we have over 40 different options from entry level doors to some really high-end, one-of-a-kind offerings.

Stephanie:

I love that. Do I think of it like white labeling? You take IKEA's [inaudible] and then you can add like rose gold fixtures on it, yeah?

John:

Yeah, absolutely. Yeah. The credit, obviously, goes back to IKEA. This is an ever expanding ecosystem that's been around probably for 15 years now. People that make amazing slipcovers that you can put on their sofas. People that make furniture legs, companies like us that make fantastic cabinet doors. It's a way to get a really high-end look for a really mid-level price.

Stephanie:

Cool.

John:

I'm even fortunate to grow quite a bit with that.

Stephanie:

That's great. How did you come to this idea?

John:

I'm always honest and clear that this was ... It's a spectacular idea that somebody gave to me.

Stephanie:

Who gave it to you?

John:

I think his name is David Stewart. I think he's a photographer. Look, I'm 53. I don't know if I'm older than a lot of the people you talk to.

Stephanie:

A little.

John:

I came to things a little bit later. I had moved to California from the East Coast when I was 21. Well, wanted to get rich and famous, work in the film business, didn't really have any kind of plan, bounced around with that, was writing, not making any money like everybody else I knew waiting tables. Then I woke up in my early 30s and said, I got to do something with my life. It was post 9/11, which is a wake-up call for a lot of people. I tried a bunch of different things. Then I somehow landed in woodworking and furniture making at first and cabinetry. I got good at it.

John:

Through the late '90s and early 2000s, that's what I was doing, Southern California based custom furniture and cabinetry company called Handmade. I worked hard. I approached it like a business into my late 30s, which was different than a lot of other people I knew, the craftspeople, spectacular artists, but just no head for business, no interest in business. I always looked at it like as a business like any other. That's what I was doing through, again, the early 2000s. I was networking and blogs just started to happen. I was doing a lot of woodworking shows but also design shows. At one of those design shows in 2008, I think somebody came up to me, this guy randomly and said, "Have you ever thought about making doors for IKEA cabinets?"

Stephanie:

Was that something that others were doing? Why did he have that idea? Then was like, I'm going to tell John to do that.

John:

It's interesting. Again, I always want to give credit where credit is due. On top of him, there was a company called Scherr's based in North Dakota that has been making doors for IKEA cabinets just a little bit prior to that. People are always making their own doors as well. It is because IKEA lets you not buy doors when you buy their kitchens. I don't know why he mentioned it. I think part of it was because when I did those shows, it was a show called Whelan Design, which is a great show in Southern California at the time and back when Dwell magazine was really in its heyday and just an iconic brand.

John:

I was always like the one off independent company. It was me and all the big brands. It would be like Kohler and Caesarstone and Sub-Zero. I was there alongside them with my little custom furniture setup. I don't know if he took a liking to me, but we just spent that day, the Friday and then the following day just talking about it. I had no idea what he was talking about at first.

Stephanie:

That's awesome. Then for people listening, I know when I first heard of your brand and was looking through it. I'm like, oh, it's just like a small thing, a big thing. Then I was looking through some of the stats and you've been named like the fastest growing private company every year by Inc. magazine [inaudible].

John:

Well, yeah, one of. Yeah, one of many. Inc. 500 originally, we've been on that list, I think, six or seven years now.

Stephanie:

You've had double digit growth for almost a decade, year every year.

John:

Yeah. It's exciting. It's, again, one of many things. I try to be candid and clear, but I never expected this. I never thought in a million years I'd be doing this. Every year that we were fortunate to grow, even my ambition or dreams, it got bigger. It's like get to a million, get to two million, get to five million. It's been exciting. Believe me, I don't take it for granted. That's why I enjoy doing things like this, because I always ... At 40, I was newly divorced. I didn't have any kids at the time. I have a son now. He was nine. I lived in my shop for a year, because I got divorced.

John:

I didn't have anywhere to live. I had options, but I wanted to hide. I lived in my woodworking shop. I lived on my sofa with my dog. I just said, I got to do something else. It was a huge wakeup call. Then that's when the conversation I had, I think, six to nine months prior. It was like, maybe I should try this. Again, in terms of the second acts in life, whatever, I was 40 and had no clue. 10 years later, more than 10 years later, it's different.

Stephanie:

Yeah, that's very inspirational. Cool to hear about and cool to see where you can start and where it can grow to. How did you grow the company? From starting out where you're woodworking, you're building stuff, and then you're like, okay, I'm going to buy IKEA stuff and make it better. How did you get in front of people and be found in general?

John:

Like anything, Stephanie, it's like you look back on it and as much as it was, a long journey at times were so challenging, whatever. You get through it, and you gloss over it. It's only when conversations like this that I do get an opportunity to look back. The reality was, again, I had a nice custom furniture cabinetry business. I had some really good clients. I work with some good architects and designers. Then in 2008, the market tanked. Everybody went in the dumpster. I had to do something else. Things had slowed down.

John:

I started saying to a couple designers and architects, "What if we try to do integrate some IKEA cabinetry into the custom project." Because at the end of the day, a box is a box, and you're just going to see the outside of the beautiful panels and the doors. There were a few people that took a chance on that. That's how it ... It's like anything. I was 100% custom in 2009. Then it's like, okay, you can start mixing it in and starting to organically ... I don't even know what kind of ... I wasn't doing advertising. Blogs had just taken off.

John:

Apartment therapy had seen see me at a design show and written about me, which was amazing. That was a really big deal. L.A. Times did a story on me, which is incredible. Yet it was always organic. Through 2010 and 2011, it became, okay, now we're doing half custom, half IKEA. Then every year, it's a little bit more headed towards full IKEA. The truth is, I don't know when it was, maybe 2013, when it was fully just making doors for IKEA. It was fun. It was always a steady progression, always growing every year.

Stephanie:

Yeah, sustainably growing, which is a lot different than a lot of the brand.

John:

Yeah, profitable every year. Beginning, doubling every year, which, again, was not what I expected. Part of that, what's funny too is I have a lot of incredibly supportive family, but also friends, guys that I grew up with. When I was in California at 21, or 22, or 29, or whatever, they were amazing. They love me. They were supportive, but they probably had no clue where I was headed. I didn't either. Now, it's fun. I gave them a hard time constantly about the fact that they probably gave up on me.

John:

Not in a bad way, but it's just ... I mean, I do think that there is a time to cash in your chips. It's great to have dreams. There was an interesting like Scott Galloway kind of thing recently about if you should follow your dream. His overly simplistic thing is definitely do not follow your dream. Because unless you're willing to pay your bills to start because following just exclusively your dream can be incredibly impractical. The people that you admire, suddenly, the people that I admire weren't these head up in the clouds kind of people. They worked really hard. I geek out on founder stories, things, podcasts like this. I'm fascinated by that. It's never an overnight thing, or at least it's rarely. Again, I'm 53 now. This is all house money.

Stephanie:

Wow, that's awesome. When you started, getting more money, you're doubling growth, more revenue, obviously. Where did you invest? How did you think about investing that? Because I'm sure you're like, woo-hoo! I'm going to go have fun now.

John:

No.

Stephanie:

No?

John:

It was never like that, no. It's interesting. I would say I like nice things like some people do. I'm pretty frugal. In terms of the business, everything lives inside the business. I had a partner at that point. Up until three years ago, we made everything in-house. I was the original guy making the doors and packing them up and then shipping them in New York or different places. Then my partner at the time, Ivan, came on board. He was the guy cutting the doors. Now, we were fortunate to grow.

John:

Eventually, we had close to 35, I think 35 or 40 people that were working in production. Up until three years ago, we topped out at 75 people and half of them were making products. Now I'm proud to say we don't make anything in-house. Everything, it's made around the US, some at the top manufacturers in the country. That was a huge shift. To answer your question, everything is in the business. That's why you see revenue numbers are different than other things.

Stephanie:

Yeah. What were some mistakes maybe that you remember where you're like, ooh, I would have avoided this if I were to do it again, or especially in the more maybe the past five years or something. Not early on when you're just ...

John:

Right. If we're going to say 10 years ago, the mistakes that I made were unavoidable in the sense that I was creating this out of thin air. Ivan and I were just making stuff up as we went along. We were two guys. He's a little bit younger than me. He came out from Boston. I came out from Philadelphia to be writers. In some ways, no business starting this kind of business. In the last five years, it's probably the mistakes that I've made are ... I don't know, maybe waiting too long to really build up the team, which is not to say that we didn't have good people, we did.

John:

Part of my job now is just looking at the next 12 months and 18 months and say, hopefully, where are we going to be? Where do we think we're going to be? What are we going to need then? As someone who is ... Again, I think pretty honest about their limitations or whatever, we only thrive with people that are smarter, better, or more experienced than me. That's one of the biggest changes in the last at least six months, where we really just hit the gas and brought in some really amazing complementary pieces.

Stephanie:

Yeah, cool. How do you think about building on top of another company? What if IKEA changes their cabinet line or does something different, did that ever worry you, building a business that's ... I mean, a lot of businesses are built on another businesses, obviously. How did you think about that?

John:

We've always been after market. With IKEA, it's pretty well documented. We've gone up and down with them. I think in most ways, they appreciate what we do. Certainly, it's undeniable that we sell kitchens that people wouldn't normally buy if we weren't available. They also, I think, hate a little bit that we're there. I don't know this is arrogant or anything to say. They're not going to change their model because of us. They're never going to not sell doors. Even if they did, I would say to people like, "Then just buy the doors that literally cost $2."

John:

Then we'll pay for them and recycle. Their model is that a la carte wide range of pricing. We've always been respectful. Again, I have immense respect for them and what they built. It's extraordinary. Even when my fiancé and I moved into a new house and it's like going there, buying the basics for the house, it's just nobody can beat it [inaudible].

Stephanie:

Yup. I'm doing that now as well. I think, like you said, you're opening up a market that they probably wouldn't have access, otherwise. When I'm about finishing this house now, I honestly would not have thought to go to IKEA to get cabinets. I don't know. Then when I saw you guys, I'm like, oh, well then you can have the finishings and the colors and the things that I actually want. I don't actually care what a cabinet is like inside or behind the scenes, but I care about how it looks. A lot of the IKEA stuff does look like you know sometimes.

John:

Yeah, it's understandable. Because at that scale, you can't get that fancy and creative. This is the part where I drop names, just in the sense that what I do love is we work with some really cool people that do make IKEA more accessible. It is people like Karlie Kloss and Coco Rocha and all kinds of celebrities and high end designers and influencers. They, more so than us, have normalized IKEA. That's good for everybody. If design is supposed to be democratic and accessible to everybody, there's nothing more accessible than IKEA. Obviously, Amazon, Wayfair, and things like that.

Stephanie:

Walmart? Walmart is coming back. I have bought rugs now, a little egg wicker chair. It's from following influencers. I'm like, Walmart is coming back.

John:

You're right. It's funny, because the same thing with my fiancé, Stephanie. Yesterday, she was looking at different coffee tables. She said, "This is ... " She showed me a thing. I was like, "That's awesome." She said, "Oh, it's like the Kelly Clarkson line." I was like, "This is great." It's true. Look, certainly, you can make the argument that some of that stuff is more disposable and it's going to go into a landfill and less sustainable. I understand that. The reality is, not everyone has the same access to disposable. If you can get cool stuff, it's reasonably priced and it lasts for a few years. I don't know. It's hard to turn that down.

Stephanie:

You mentioned that you partner with influencers and celebrities. How does that relationship work?

John:

Yeah. I think that's always been a huge differentiator for us, one of several things. From the start, I always felt no self-consciousness about reaching out to people. Whether it was blogs, I would say, "This is what we're doing. Here are some photos. I'd love for you to write about us." Or even influencers. The biggest one and the one that we worked with the most is Sarah Sherman Samuel. We've had a door line with Sarah for three years. That's a situation where, god, I think 2014 or 2015, she reached out and said, "Hey, I bought a bungalow in Venice. I love IKEA cabinets.

John:

I wonder if we could partner on some doors." We did a small collaboration, gave her a tiny discount. She painted the doors. She styled everything. She took photography. The kitchen went completely viral. It's one of those kitchens that is everywhere. I think a really cool Farrow & Ball paints, brass and mixture of this light green and white. That just opened the door to all these other relationships. People saw that and started reaching out to us. It's been an amazing thing. The truth is, we've gotten to a point where we've had to pull back on that because it's just a different way to market the brand. It can be expensive. It's definitely grown us, there's no doubt about it.

Stephanie:

Have you thought about Netflix series? I'm just thinking, wow, they should be on a home remodel type of show. How perfect is that? People always trying to do amazing things on a budget on like the HGTV [inaudible].

John:

Yeah. We've talked about that stuff in the past. I like that stuff. Again, I don't know. I do think it's interesting our growth. That's how I always look at things, behind the scenes of how businesses grow, especially within that. I do like someone we haven't worked with in a while, the Studio McGee, the Netflix series, which is great. That's really interesting, especially after listening to another podcast like our friends at Business of Home, where ... I left the podcast with so much more respect.

John:

Because my interaction with them was a long time ago, and then I just see the photos and the beautiful stuff. Just the growth that they've had and the behind the scenes, and again, hearing their story is really extraordinary. I enjoy watching that stuff. I don't know if I want to watch this. I get sick of hearing myself talk. Maybe if it's everybody else, that might work.

Stephanie:

Yeah. I was just thinking like, wow, that'd be a really good partnership strategy. I always bring up the Container Store partnership that they had on the Netflix series and just how much Container Store sales went up after that series.

John:

[inaudible]

Stephanie:

I can see why, same thing with cabinets and stuff.

John:

Yeah, it's interesting. Because even that, again, I'm a lot older than you, but in the early '90s, whenever Trading Spaces came on and that was huge like ...

Stephanie:

I watch Trading Spaces, just to be clear.

John:

I mean, even in the '80s, the godfather of that is like Bob Vila in this old house. That's definitely before your time. That was restoring amazing New England homes and stuff. It was master carpenter, Norm. I think Norm Abram is absolute craftsman. That was the start. Then you had Trading Spaces. Even now, you would have thought, after 10 years, that goes away, and it hasn't. That's the thing. Is it the ladies like Home Edit and stuff like that? I don't know. It hasn't evaded, it just only grown. Obviously, Chip and Joanna Gaines and the dynasty that they have built. It doesn't show any sign of stopping.

Stephanie:

Yeah. It seems like the world is now just moving to a more curated collections like I'm going to look for someone who knows my style, so I don't have to waste time looking at everything. Whereas before, it's like, oh, I'm going to go to Target to get this, and then I'm going to go to Dollar Tree to get this. I make it up. I think, 10 years ago is very much about DIY, but all over the place. Now, it's like, okay, I'm going to follow Chip and Joanna Gaines, their line at Target, whatever that is, and follow the people that I know are my style and be ready to immerge myself in that brand.

John:

Yeah. The interesting, whether it's the 180 to that is the amount of growth that Restoration Hardware has had, where it's just almost like meteoric, being a complete luxury brand and selling the whole experience. It is like the Ralph Lauren of today, and now as they move towards hospitality restaurants and sounds like hotels. Part of your brain thinks, man, you can't sustain that. How do you keep growing? There is a market for that. Even when you watch the Studio McGee, their services are not expensive. Amber Interiors, who we work with, people like that, incredibly talented, at the really high end of the market. They keep growing.

Stephanie:

Yup. Tell me a bit about your omnichannel approach. I saw that you had showrooms around the country. Then you're, obviously, online as well. Now you're moving into DTC. How do you think about keeping a cohesive story of your brand but also expanding and reaching a lot of people on different channels?

John:

I guess the biggest challenge, if it is the biggest, it's just the fact that what we're selling comes at a higher price point than the average online purchase. We sell certainly, if you're doing a GODMORGON bathroom vanity, that then may cost $150, $300, $400. We're selling cabinet doors and panels and complementary trim and things like that that can cost $3,000, $5,000, $20,000. Again, it's not buying a pair of Warby's or an Olay bag for a couple hundred bucks. There's a lot to it, a lot of back and forth. Excuse me.

John:

Showrooms we're always a part of we've got to show people our product, especially when we're asking them to spend that much. The benefit of IKEA is, even though they're still a privately held company, there are only, I think, less than 60 around the US. What I could say to people to say to you, Stephanie, or wherever, like you're in New York, go to one of the five local IKEAs. Then come into our mini ... I never want to call it a showroom, because it could be 200 square feet. It's got some cabinetry in it. It's got door samples, things like that. There would be a whole experience.

John:

I would always say, if you want to see a kitchen, go to IKEA and you can see 15 kitchens or see 20 kitchens. Want to see the doors? Come see us. We've had that in New York, in Brooklyn, in Chicago, obviously, in LA, Minneapolis, a bunch of different places. Again, trying to be reasonable about that. I don't want the overhead of signing leases if I don't have to. What we've typically done and we will continue to do even more so is partner with other great brands. It is like a multi-brand approach.

John:

With our lighting friends, with hardware companies like Rejuvenation, Fireclay Tile, upcoming collaboration with Caesarstone, it's partnering with Cambria in the past. It's just saying, let's do this collectively. Because the kitchen is, as someone said to me, "The base purchase, if you're fortunate to have him as a house, there's a car, and then maybe there's your kitchen." We're trying to grow the company that way. We started what I think is an amazing ... I got to [inaudible] blog anymore. It's that. [inaudible] stories that launched last summer.

John:

That was the idea that I wanted to bring together all these great writers, great content to help promote the brand, of course, but also expand us, again, to make that cliché to becoming a lifestyle brand. On the one hand, it would be enough to have a really successful cabinet door company. I just think we have the opportunity to do so much more. That's what something else we can talk about, is this brand Boxi, which is going to launch at the beginning of March. That really is direct to consumer. That's our own product, no IKEA. That's a whole different thing for us.

Stephanie:

Alright. Let's move there next after my one thought. I've many ideas when talking to you now.

John:

Awesome.

Stephanie:

What about having like partnering with IKEA on their AR app or developing your own AR app, instead of having to have a showroom, being going to IKEA, pull up your phone, and then you can swipe through the designs of ours, and you can see exactly what that trim would look like, what that doorknob or whatever, so then you eliminate showroom.

John:

It is interesting. Look, the thing with IKEA, they have partnered with people in the past. Obviously, places like Target have done an amazing job of that completely. As you said, Walmart too.. It always seem like the natural fit with us. If you were going to do it with anybody, it would be us. In terms of AI, yeah. IKEA has been slow and is put a huge push in the last couple years of their online presence and their economy. They have an app they launched last month. What we are doing with the new brand is working with a 3D AI company called Skip. It's going to launch in the next few months. That lets you basically not go in showrooms.

John:

There are ways to order this new line of cabinets, and one of them is to make an appointment and someone comes to your house and 3D scans your room. Then you design remotely. With 80 hours of AI and machine learning and everything else, it's compressing that and then presenting you with design options.

Stephanie:

That's cool.

John:

That's where we're headed. All has changed dramatically in the last year. COVID or not, it was headed towards that. The new iPhones have the camera technology where you can almost do that. Maybe in 12 to 15 months, you don't even need a guy to come to your house. You can do it with your iPhone. They're already pretty close.

Stephanie:

Yeah, I think it's fair. I have a little tape measure app on my phone and it says, okay, scan the whole room. You do that and then you can measure everything. The placeholders all around the room for you and [inaudible].

John:

Yeah, it's fascinating. Even brands like Primer that launched last year, which do the work with other brand partners, and you want to click on like the Hygge and West Wallpaper, you can hold it up to your wall. They'll show you different swatches and things like that. It's interesting. For us, yeah, that is part of what we think is a differentiator. IKEA is always going to have massive brick and mortar. Even though they move in some cities towards smaller footprints, it's still footprints that are 20,000 to 150,000, as opposed to 300,000. There's another cabinet line that's launching.

John:

It just launched, it's got a 30,000 square foot showroom on the East Coast and 100 kitchens. You go in and wear the AR or the VR goggles. That's completely different because you're looking at some space that has nothing to do with yours. It's kind of what you're saying. The point is, things are changing so fast. With Boxi, it is saying, can you make this as DTC as possible? The caveat being, it could cost $10,000 to $15,000, to $20,000. It's not like ...

Stephanie:

Okay. Tell me what is Boxi then since we [crosstalk].

John:

Boxi is the first American direct to consumer cabinet brand. It's a cabinet system for the entire home. It's basically taking the last 10, 11 years of everything we've learned from IKEA and saying, let's try and offer something. I don't know, if it's ... I don't want to say better than IKEA. Because again, I've huge respect for them. It's a more complete package. Certainly, the quality is there. The accessibility is there. One of many things that we're going to improve on is the fact that Semihandmade customers have to go to IKEA first.

John:

It's a two-part process where you've got to go to IKEA. You've got to order the cabinets and hardware. Then you've got to order the doors from us. Thank God that they do, but especially in the last year, IKEA, like a lot of people, has suffered horribly with supply chain issues. We have customers now, unfortunately, it's January, they're hearing, cabinet boxes might not be available for three, four, or five months because ...

Stephanie:

I ordered a couch from Pottery Barn and four months out. [crosstalk] order, I just didn't look, I guess.

John:

As a business, on a personal level, that annoys me because I want ... That's a whole thing. We have such ridiculous expectations because they're easily met or they have been up until now. Not to blame Amazon because that's too easy. I'm a hypocrite about Amazon too. With Boxi, we're saying, no big box stores. Somebody can come to you, things ship, leave the factory in a week. Part of what we're doing, you're from Palo Alto, I don't know if you're born there, but it's almost like an In-N-Out Burger West Coast approach. Meaning we're going to do a limited number of items, and we're going to do it great. If you want ...

John:

What they do is they're great. What's interesting about that is they ... I think just little background on burgers. I think the founder was best friends with Carl Karcher who started Carl's Jr., another big West Coast place. In the '50s, they open hamburger stands right next to each other. The In-N-Out guy's thing was always, I'm not worried about competition. You're welcome to open across the street from me, next door, or whatever, because I'm just going to bury you. I'll just be that much better. Not like in an obnoxious, overly competitive way. Just like, this is going to raise our game. With us, with Boxi, yeah, limited selection, fast turnaround ships in a week, never need to go to a big box store. It's built in the US at a really competitive price point. That's the idea.

Stephanie:

I love that it's built in the US. I think that a lot of companies right now are bringing things back into the US and some are struggling seeing how expensive things can be and what was happening overseas and maybe how it's just different here. What did you guys learn from IKEA that you're taking with you? Then what are you discarding where you're like, we're going to do this different though?

John:

Again, in some ways, I learned everything from IKEA. Look, I learned a couple things. One of them is you can't compete with them in terms of pricing. That's the most basic thing. I always say like, with Amazon, the same thing, you can't ... I mean, then the turnaround lead time. Up until recently, with COVID, you could buy a kitchen today and bring it home today. Nobody else could do that at a crazy price. Best of all, really high quality. IKEA, to their credit, pretty much every year, as long as I can remember, the last 10 years, is right at the top of like J.D. Power customer satisfaction in terms of quality, customer service, things like that.

John:

You could complain about certain products from IKEA and their quality, but their kitchens, I think, are inarguable. As much as I'm not affiliated with them directly, I always get defensive when people would slag them. Because it's also understanding that the product that they offer, and this blows some Americans minds, but it's a particleboard core with a melamine skin, a three-quarter melamine box. That standard in the entire world for kitchen cabinets. The most expensive cabinet brands in the world are constructed the same way.

John:

In the US, that's less the case because 70% of the market wants a frame around their cabinet. It's literally a face frame cabinet. The European style that IKEA is called frameless 32 millimeter. Again, I've learned everything. We're deeply indebted to them.

Stephanie:

Well, is there anything that you're changing though now that you are exploring DTC that's [crosstalk]?

John:

Yeah. We'll always have the ability. With Semihandmade, one of the differentiators were ... You'll always have this when you're smaller, we're microscopic compared to them. It's just being able to be nimble, to be able to get more custom, to be able to offer certain versatility that they could never do. Limited run doors, ability to do appliance panels for really anything. The Semihandmade, we could always do that. We can do upgrades with matching ... We used to do open cabinets that match your doors and things like that. We do less of that now.

John:

With Boxi, what will be interesting is because the hope is anybody to scale and to have short lead times, quick turnaround, we're not going to offer as much customization. We've learned like what ... In terms of people's taste. We have eight doors, which are basically the biggest sellers for Semihandmade. It's basic white, gray, black, and some wood tones. It's not saying like we have at Semihandmade of 45 choices. That's fun to me. Because if anything, you can have too many options and that is paralyzing.

Stephanie:

Yup. Just going to say that I appreciate when things are curated or you showed me something cute and I'm just like, "I'll have that." Whatever that is, the white, the gold, and the brown, perfect. That's what I want. Not choose every single piece of it. Which I think is for a lot of ecommerce, that's what I've heard throughout many interviews, is don't give so many choices, show people what you think or know that they're going to want based off of preferences or how they're interacting with your site or whatever it may be.

John:

That's part of if there'd been multiple challenges with getting Boxi off the ground understandably. I think the biggest one is like you said, with even a call today, there was seven of us on the screen and I said, "If the seven of us were the typical technology guys or girls that knew nothing about socks, but we're launching a socks brand, we wouldn't bring all this baggage to it about what we thought we knew." With Semihandmade, we have all this great knowledge, but some of it can get in the way with the new brand.

John:

Because the new brand, for it to really work, you can't do all the customization. There are certain things that Semihandmade where we'll make exceptions and we'll do things. Of course, you always want to service the customer, first and foremost. It's just recognizing that if the goal is for this really to take off and grow, which I think it will, we have to be a little stricter, a little more brand fidelity, like say, this is who we are, this is how we get to where we want to go, and then stick to that.

Stephanie:

Yeah, that seems tricky. Having two different hats where you and your team are like, we know what works, this is what works, we build a company that does this. Then having a slow creep where you turn the other brand into the same thing. Like you said, you have to really be strict about creating a whole new company with a new vision and making sure everyone's on board and not just let the old company creep in and [crosstalk].

John:

I think in some ways too, whether in a good way or a bad way, the fact that we've been fortunate to have growth and success for Semihandmade, it's either made it easier or harder to get the new venture off. Because it buys you certain time. If we were a startup, we raised funding. We've got 18 months to runway all these different things that will be different. Probably, things have taken longer. On the other hand, we wouldn't have been able to do it. When this launches, what we leverage is, yeah, it's 10 years of Semihandmade. It's 25,000 projects. It's incredible.

John:

We have 2,000 semipro designers around the country that are champing at the bit to offer this. It's relationships we've got with Rejuvination and Kaff appliances and Caesarstone that are going to be partners. I continue to remind people and even myself like if we were a startup, we'd never have this stuff. We wouldn't have five, six amazing influencer projects that you're going to roll out in the next six weeks with the new launch. You'd be launching and then keeping your fingers crossed.

Stephanie:

Yeah, yeah. Okay, cool. Alright, so let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have one minute or less, prepare, get your water, [inaudible], shake it out, do what you got to do. Alright, are you ready, John?

John:

Yup.

Stephanie:

Alright. What one thing will have the biggest impact on ecommerce in the next year?

John:

That's great question. Do I have a minute for this?

Stephanie:

Yeah, a minute.

John:

I think it depends. I'm cynical about the fact that in some ways, yeah, a lot of companies have taken off, Instacart and things like that, but even like Wayfair. I was reading Bed Bath & Beyond today. I think the question is whether or not that'll be sustained. When life comes back to normal, which hopefully, inevitably will, certainly, people will be more inclined to shop online. There's no doubt about that. The world is changing. It's not going to go back. There are companies that have gotten a little frothier or whatever that I think that artificial is going to wear off. It's normalized.

John:

It's great. There's stuff I would have never done. Even with not ecomm, but with Zoom, we hired a new president, Beth and Molly, who runs marketing and stuff. I hired three of our highest people remotely. They're based in New York. I would have never done that. I would never trusted people or trusted myself. Now, it's normal.

Stephanie:

Yeah. I was slow with grocery delivery and curbside pickup. It forced me to do that because I was the one who always want to go to the grocery store, look around with my friends, whatever it maybe. Now, I'm like, oh, I don't really want to go there anymore. There's no point. I'll save my time and do other things.

John:

It is amazing. To me, it's more interesting to see how those people make money. That's the part where it's one thing to do great revenue. Obviously, profitability is a thing, unless it's not your money, unless you have a thing too. When it is your money, it's much more of a focus.

Stephanie:

Yeah. We just had someone from Intel on who was saying that they work with a hardware store and they're struggling because contractors were coming in and placing 40, 50 item orders for curbside pickup.

John:

All of it?

Stephanie:

Because they're like, why would I send in my contractor and paid him to be there for two to three hours when I could just have you all do it. They're struggling with trying to figure out the program because they weren't really expecting them.

John:

Yeah, that's interesting.

Stephanie:

I'm like, that's scary. What's the nicest thing anyone's ever done for you?

John:

Business wise or otherwise?

Stephanie:

Anything, whatever comes to mind.

John:

I guess the biggest cliché was my son's mom having my son. That's probably ...

Stephanie:

That's a good one. Having three kids, I appreciate that answer.

John:

I mean that from heart.

Stephanie:

Yeah, that's a good one. What's up next on your reading list?

John:

I constantly have five or six books I'm reading. That's interesting too, whether it's because I pursued writing for a long time. I haven't made the jump to eBooks. There are few writers that I correspond with on Twitter. Twitter is another thing that I didn't use that much before this. I've asked them like, "Well, what's the feeling on eBooks? Is it like cheating or whatever?" Of course, these guys and girls want to sell books. They're not considered cheating if you buy their eBook. The response I got from a bunch of them was, it's best in some ways for nonfiction.

John:

I read tons of nonfiction. I'm reading Say Nothing, which is a story about the troubles in Ireland. I'm finishing a great book on ecommerce called the Billion Dollar Brands book, something like that. That's spectacular. I've got so many. I'm reading a book on Chinatown, the making of the movie. I love a lot of different things. It is mainly. It's less fiction now. It is more nonfiction.

Stephanie:

Very cool. What is your favorite cabinet design? What's in your house?

John:

My house, it's interesting. Because in my house that I share with my son who I split custody with, we have a more contemporary kitchen. It's walnut. It's unique. We sell a fair amount of walnut and it is one of a kind. Every kitchen is different. That's a little more contemporary, even though it's wood. It's contemporary. In the house with my fiancé, where she lives, that's a more traditional. It's a shaker kitchen. It's got some really pretty hardware. I guess I'm very particular about what I like. In general, even when we she and I have arguments about furniture, I just say like, "Buy something quality and it'll fit with everything else." I know it's a copout, but that's where I'm landed. I love eclectic as long as it's nice quality.

Stephanie:

Yeah, cool. Alright and then the last one, if you were to have a podcast, what would it be about? Who would your first guest be?

John:

That's a great question. I like a lot of probably IKEA. I like a lot of different things. Even podcasts, same thing. I didn't listen to before, frankly, a year ago. I listened to one the other day. Marc Maron was really talented, funny guy who've been doing podcast for about 10 years. He had this guy, Daniel Lanois, who's a big time record producer, did U2 and all kinds of amazing people. I was amazed at the depth of Maron's knowledge of music. I don't have that. I don't know. I like diverse things. I don't know if I could do it.

John:

Because I like to think I'm a good listener, but I'm probably not because I'm always ready to say something. Obviously, like in your spot or whatever, to do it well, you should be listening to people. Again, I love screenwriting podcasts. I like anything. I like news, podcasts.

Stephanie:

Okay, so it'd be a little bit of everything. I like that. That's cool.

John:

I could do this kind of thing. If we're talking about remodeling, if anything, would always have an edge to it. If I were going to do a show, that's the thing. I gravitate less, maybe not towards Gordon Ramsay, but like Anthony Bourdain. There would be an edge to it. It wouldn't be ... Even when I was inside people's houses, I don't know if I was combative. I had very strong opinions about with architects and designers and homeowners and what I thought they should want. The one thing I don't like is when it's all sweet and sacristy and artificial. Totally with an edge.

Stephanie:

I like that. That sounds good. Alright, John, well, this has been a pleasure having you on. Where can people find out more about you and your work?

John:

Sure. Semihandmade, we can do semihandmade.com. Then Boxi, which launches March 1st, is at boxiliving, B-O-X-I-L-I-V-I-N-G.com.

Stephanie:

Okay, thanks.

John:

I appreciate the time. This has been great.

Stephanie:

Yeah. Thanks so much for coming on. It was fun.

John:

Thanks for having me, Stephanie.

Don’t Spin The Wheel: The Fight Against Malvertising

info@mission.org (Mission) — Thu, 11 Feb 2021 08:00:00 +0000

We’ve all seen it — maybe some of us have even fallen for the trick — you’re on an ecommerce site and a big “Wheel of Savings” pops up. This innocent-seeming discount offer, though, isn’t what it seems, and it’s doing damage to the end-user spinning the wheel, and the site the wheel pops up on.

The world of malvertising and browser extensions has been causing headaches in the ecommerce world for years and brands are constantly looking for ways to fight back and regain control of their websites. Matt Gillis is helping with that mission. Matt is the CEO of clean.io, which offers real-time protection against malicious actors and code for some of the most-trafficked websites in the world.

On this episode of Up Next in Commerce, Matt takes us through some of the methods bad actors are using to install malicious code on ecommerce sites, and he gets into the nitty gritty of why browser extensions like Honey and Wikibuy are hurting brand bottom lines, and why those extensions are making marketing attribution nearly impossible. But he also offers some solutions, too, so that ecommerce brands can finally win back control of the user experience. Enjoy this episode!

Main Takeaways:

Good Guy or Bad Guy?: Traditionally, malvertising is done by bad actors who infiltrate websites and take over through ads. But in the world of ecommerce, the bad actors are actually manifesting in the form of Fortune 100 companies that profit from website extensions like Honey and Wikibuy, which disrupt the user experience of the customer on the original ecommerce site. Solving that problem is the challenge for ecommerce brands that want to take back control.
Sneakily Effective: In the malvertising world, the bad actors are at the top of the marketing game. They can achieve a 100% click-through rate at little to no cost because they are using sly, untraceable strategies. Targeting and eliminating those malvertisers is critical in order to level the playing field for ecommerce marketers to have success moving forward.
Last Line of Defense: Publishing platforms hold most of the responsibility for the end-user experience. Everybody has a role to play in minimizing the risk of malicious buyers or advertisers, but ultimately, the publisher is the last line of defense against malvertising moving into the user experience, and they should be held accountable.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone. And welcome back to Up Next In Commerce. This is your host, Stephanie Postles co-founder at mission.org. Today on the show we have Matt Gillis, the CEO at clean.io. Matt, welcome.

Matt:

Stephanie, thanks for having me. I'm excited.

Stephanie:

I am very excited to have you here. We were just talking about how cool your background is, and I think that's actually kind of a fun place to start of where you're at in the world. And tell me a bit about your background.

Matt:

Yeah. Hey, so I'm in Baltimore and we actually just took possession of this office in February, right before the pandemic. And so the irony is I've been here every day since the pandemic started pretty much.

Stephanie:

By yourself?

Matt:

But I'm by myself. So we have 4,000 square feet. We just did the mural right before the pandemic and no one on our team has been able to experience it pretty much. But yeah, cybersecurity company located in Baltimore, we're about 45 people, I guess you could say solving this problem of untrusted and malicious JavaScript that is ruining user experiences in revenue across the internet. That's us in a nutshell.

Stephanie:

Cool. Well, I am really excited to dive further into clean.io. Before we do that though, I was hoping you can kind of go through your background because I saw you've worked at places like AOL, you've been in publishing. You've been in ad space. Tell me a bit about what you did before you came to clean.io.

Matt:

So full disclosure, I'm old. And so I've been around a little bit. I've had some fun. But yeah, I think key things I've spent probably the last 20-ish or so years in a couple of different capacities. Right out of university, I started in the mobile industry and mobile at that time was just making phone calls, that's it. There wasn't even texting then.

Matt:

In fact, my job back in those days was I would stand on a golf course at a golf tournament and let people make free phone calls because that was the cool thing to do then. No one had cell phones and if they did, they were like those brick ones. You remember those ones that you couldn't fit in your pocket?

Stephanie:

Yeah. And you were the cool guy like, "I've got access to an awesome phone, anyone want in?"

Matt:

Yeah. And listen, men and women would come up to me and they'd be like, "Can I call back and check and see if I have any messages?" And so that was the cool thing to do then. I know it sounds so crazy that was a thing at some point, but yeah. So I worked at mobile operators in the early stages of my career.

Matt:

So I worked at Bell Mobility in Toronto, Canada. I'm from Toronto. And then I moved down here to work at Verizon Wireless. And at the end of my tenure at Bell Mobility and my tenure at Verizon, I was focused on some of the services that you live by on your cell phone today. So this was in kind of late '99 and then the early 2000s of things like video on demand on your phone, playing games on your phone, downloading ringtones on your phone, I'm sure you did that.

Stephanie:

Oh, ringtones, yeah [inaudible].

Matt:

They were, obviously a huge business at some point.

Stephanie:

Now if my phone rings I'm like, "Stop it, what are you doing? Who's calling me? Don't call me, text me."

Matt:

Put it on mute. Yes, exactly. So I was kind of part of the foundational days of things that you would do with your phone, before the iPhone. And then I went and took a swing at being an entrepreneur and joined a little small video game company. Our biggest game was Who Wants to Be a Millionaire? We did a lot of TV game shows. So we did, Are You Smarter than a 5th Grader? And things like that.

Matt:

So I kind of walked the mile as a publisher for a while and then Capcom, which is the Japanese video game company acquired us. So I ran their publishing business for a few years and I got to experience what it's like to be a publisher and how hard it is to make money.

Matt:

And that was kind of in those early days of the iPhone where I'd say to people, "You'll go and spend $5 on this latte, but you won't pay $5 for unlimited use of a game over a period of time." And this is back in 2008, 2009. And so we had a real struggle and people weren't wanting to pay for our games. They want them free and free became kind of the thing on the iPhone.

Matt:

And so recognizing that struggle, I actually joined this company called Millennial Media, which was one of the earliest mobile ads platforms for app developers, helping app developers make money with ads. Some of our biggest customers at the time were like Words with Friends, if you've played Words with Friends-

Stephanie:

Yes, I have.

Matt:

... ads in every game. So we were kind of one of the foundational tech partners with folks like Words with Friends and various other games across the internet and apps. Did that for eight years through an acquisition with Verizon and AOL. And then we acquired Yahoo. So I ran the publisher platforms business at the combined entity of those companies, which was awesome.

Matt:

And one of the biggest problems in my time over that period was this thing called malicious ads, or malvertising as they call it. You probably are familiar with when you're scrolling away on your phone and all of a sudden it redirects you and says, congratulations, you won an Amazon gift card. And you're like, "I didn't click anything." Or spin the wheel for your chance.

Stephanie:

Yeah. I did that once I fell for it. I was like, "Oh, I spun it." I couldn't help it.

Matt:

Never spin the wheel, Stephanie.

Stephanie:

I only did it once, but yeah, afterwards I'm like, "That was a bad call. Why did I do that?"

Matt:

Yeah. So it was a big problem in my past life. And there were a few folks that were solving this problem and two of them were folks that I had worked with at AOL. When I left, it was called Oath at the time, which is Verizon Media now.

Matt:

I went and had lunch with these guys and they told me that they were spinning up this company called Clean Creative and set to solve this problem of malvertising. And I didn't have a job and it was getting too cold to golf. And so I said, "Hey guys, can I be an intern?"

Matt:

And so I came and hung around for a couple of days a week. And I was like, "You guys are really onto something here because this was a massive problem in my prior life." And so I said, "Hey, can I have the keys?" And they obliged. And that's how I'm here, started as the CEO two years ago. And we've kind of been blowing it up ever since. That's awesome.

Stephanie:

Yeah, such a fun story. So what is your day to day look like now? And what's your best day in the office look like while you're there by yourself? Are you around skipping around bicycling around the big office? What is your days look like?

Matt:

I do pace and I get my steps in over there. Day-to-day, we're startup, so we're small. And so as any of your listeners would know at a startup you do everything, and you take the trash out and you sign big contracts, hopefully you raise money. You kind of do run the gamut. So it's a little bit of everything. If you've worked at a startup you know that generally speaking, there's epic highs and epic lows. And so you have those days where you are the king of the world and you and your team are high-fiving and celebrating. And that's a little different now because you got to do it all virtually.

Matt:

Part of being at a startup is you get that culture of everybody generally speaking, being in an office like this, but we're a widely distributed culture now. We were before the pandemic where we kind of had, I don't know, five or six or seven locations among all of our people, but now we have 40 locations. So it's just like any other gig except there's really no net underneath you. You're walking this tightrope and hopefully you get to the other side.

Stephanie:

Yes. I definitely feel that.

Matt:

It's fun though. Isn't that why you do it?

Stephanie:

I mean, yeah, it's definitely really fun. Other times you're like, "Oh my gosh, I'm responsible for so many lives." And then other days it's like, "This is fun." So it's a good balance.

Matt:

Yeah. I mean, I won't lie. I had months of sleepless nights when we were raising money. We most recently raised our series A and we started raising it in March, right at the beginning of the pandemic. And yeah, all these people's jobs, for me, the pressure was on me to make sure that we could raise money and continue on this mission.

Matt:

The reality is, is the people behind the scenes are the ones that actually made my job easy because they're the ones that enabled me to go and tell the story of our massive revenue growth and our massive traction and our product market fit and all of that sort of stuff.

Matt:

Startups are hard, but there's a reason that many people once you leave the big company and you actually go and take your swing, that becomes the thing that you keep doing and doing and doing because you like having that euphoric feeling.

Stephanie:

Yeah. No, I definitely agree. And I mean, I think it's a good reminder too, as the CEO at any company to kind of get out of your way and hire a team that can support you and do things, but then let you do the higher level things like selling, raising money, such is a good point for, I think a lot of business owners who want to kind of stay attached to, "I've always been coding." Or, "I always did this part of the business." You need to step away and find people who can step in for you so you can go on to the next thing.

Matt:

Yeah, and focus on your strengths. Don't try and overcompensate and really... We did this thing called StrengthsFinder with our leadership team. And it was really about figuring out what are the strengths across this group of people that are practically leading the company. And you go, "Okay, well, I'm really good at this, this and this. And you're really good at this, this and this. Wow. We compliment each other. I should continue to keep doing this stuff. And boy, we should just let you handle all of this sort of stuff." So yeah, hire a diverse team and hire people that are way smarter than you and you'll be successful.

Stephanie:

So how have you seen the digital security landscape change? Maybe even over just the past year or two, what new things are popping up, what should e-commerce owners be aware of right now that maybe wasn't happening last year or two years ago?

Matt:

I would say that where we cut our teeth was in this malvertising space and what it is, is malicious JavaScript that's kind of being injected into the user experience through ads. And what we've seen is that the bad actors, the people that are doing it, are getting even more sophisticated over time. They have figured out how to get around the systems. They've figured out how to get around the checks and balances.

Matt:

And we kind of stumbled into this e-commerce world where we were protecting, we're protecting some of the biggest websites on the internet. There's seven million websites that run our code. Probably many of the websites that you go to everyday either to get your news or to read entertainment gossip, or that sort of stuff if you do.

Stephanie:

No.

Matt:

I'm not saying you do Stephanie, but we protect all of those sites; every single page view on those pages, we make sure that the user experience is protected and revenue's protected. And by the way, in that world, it's folks that I would say, delivering malicious JavaScript. What we started seeing in the e-commerce world is there's this whole phenomenon of what I would call untrusted JavaScript.

Matt:

Now in either case, the premise is you own your website. You should be able to control everything that executes on your website. You should be able to protect your user experience. You should be able to dictate your user experience because it's your website. On the malvertising world, what we saw happening was if folks had ads on their website, they had lost control of the user experience. They had lost control of revenue because any bad actor could just buy an ad and take over the user experience and get you to spin the wheel.

Stephanie:

Only once, but yes.

Matt:

Only once, but it happened. And so in the e-commerce world, what we've noticed is there's a lot of stuff happening on e-commerce sites, just like there is in any website that is without the permission or without the authorization of the person who owns the site. The biggest problem that we kind of dug in and gone to solve for is, if you ever heard of these things called Honey or Wikibuy?

Stephanie:

Yeah.

Matt:

So these are Chrome extension, Safari extensions, Firefox extensions. They sit resident on the user's device and Stephanie, when you're out shopping on your computer and you get to check out, Honey will pop up and say, "Hey, I've got coupons for you. Do you want them?" You as the user you're probably like, "Yeah, I'd love to get a discount. I'd love a better price, if I can get it without having to do any work." Honey does all the hard work for you.

Matt:

We think that's not really in the best interest of the merchants because they own their website and now someone is injecting code in and disrupting the user experience, disrupting your revenue. So just like it is in this malvertising world, the same phenomenon is happening over here. The difference is Honey is owned by PayPal. Wikibuy is owned by Capital One.

Matt:

So the folks that I would call "bad actors" in this world are actually fortune 100 companies. They're folks that you would expect to be able to trust. And what they're doing is they're actually injecting code in to disrupt the user experience and disrupt revenue. And so that's the problem that we've gone out and solved.

Matt:

We just launched our product that's called cleanCART. And what it is is it's a Shopify app and it gives Shopify merchants the ability to protect their carts at checkout and make sure that they can prevent this sort of code from disrupting user experiences in revenue. So it really is giving control of the websites back to the merchants.

Stephanie:

Oh, interesting. So when you implement that you just can't get coupons or are there other pieces that it kind of protects as well, or the user can't see coupons from a Honey or something, or are there other things that your app is also protecting against?

Matt:

So we're in, I would say the second inning of the baseball game. So early stages. We're really focused on to start is blocking the automation of these coupons. So we don't want to block you as a user going in and manually inserting the coupon. We think that's the intended use case. But what we think is unfair is that someone is standing beside you at checkout and handing you a mitt full of coupons and actually not even handing them to you, they're actually giving them and just scanning them all to make sure that they all have a chance to work.

Matt:

If you think about this analogy, the grocery store would never let someone come and stand beside the checkout and save you 30% off your grocery order while you're already ready to pay. And I think that's the phenomenon that we're trying to solve for in the earliest days, which is, let's prevent the automation from happening. Let's not prevent people from manually inserting coupons. Let's give control back to the merchants because it impacts them in so many different ways. Obviously, it impacts them from a revenue loss perspective.

Matt:

I talk to merchants every day. Many merchants are complaining that these injections are literally scraping and pulling 30% off of their cart value at checkout. So someone who had $100 cart, they go to checkout, Honey runs and it knocks their cart value from $100 to $70. That's kind of bad for the merchant, especially if that person was going to convert anyway.

Matt:

The other key thing is Honey and Wikibuy and these other discount extensions have made it really hard for merchants to have discounting strategies that they can track. And so what's happening is that promo codes are ending up in the wrong hands. It's creating an attribution nightmare for merchants where they think that this social media influencer or this Instagrammer, or this YouTuber is driving tons of sales and lo and behold, Honey has grabbed that coupon and is injecting it.

Matt:

And now every order that comes through where Honey was present on the page is applying that person's code. And so now the merchant not only has bad data that is going to ultimately drive their marketing decisions but now, they're also losing revenue and they're paying out affiliate fees to folks that generally didn't deserve that affiliate fee. So I think it's created a bit of a nightmare.

Matt:

And so, we felt this kind of pent up demand for this product. And that's exactly what's happened is that no one has solved it. We think we're first to market. And we think it's important that people are fighting for the merchants. There's been 10 years of growth in e-commerce over the last year. The pandemic driving a lot of that.

Matt:

And we think it's important that merchants really get control of their websites, get control of their margins, get control of their revenue and really get the right data to make the right data-based decisions of how they're going to run their marketing programs.

Stephanie:

Yes. I think that's a really cool story. You were just talking about how you were looking at a problem that people were complaining about, and then now you guys are like, "Well, let's solve it." Because I've read, I'm trying to think where this was, where they're talking about going to Reddit and looking at some of the threads of people talking about problems that keep occurring and occurring and how you could build businesses just based off Reddit threads. And you guys did that, just looking at problems with what merchants were struggling with. So a really cool example of how to build a business is look at all the problems that are going on and jump at solving it.

Matt:

Well, and I think the other key thing here is as you know is solving the problem, but also during that process of your hypothesis that you're going to develop of what you're trying to prove, it's you also need to prove that people pay for it. And that's, I think part of the foundation of what we've built here, obviously on the malvertising side, but also on the e-commerce side is it's a big enough problem. People need to protect user experiences.

Matt:

If you think about just in the internet in general, it's very expensive to create content. It's very expensive to drive traffic. And once you've done those two things, why would you leave it to chance that someone might come to your website and have a crappy user experience? Protect your user experience.

Matt:

It happened last week on the Harvard Crimson on the crimson.com where somebody was on Crimson and they got one of these redirect ads that took them to this landing page that said, "Hey, you're a Verizon customer click here and take the survey and answer these nine questions and you'll have a chance to win." And this user actually took to Twitter and said, "Hey @thecrimson, which is, I think their Twitter handle, you've got a crappy user experience. Why are you letting this happen?"

Matt:

I never even saw a reply from the Crimson. But when we did some investigation on what was going on, they don't even have protection on their website. So it almost feels irresponsible at this day and age to not be protecting your asset because your asset generally speaking, isn't your website, your asset is your users.

Matt:

And so protect your users, make them feel confident that when they come to your site, they're going to have a great experience. And so that's really what we've focused on is just delivering technology that solves a problem that people are willing to pay for. Because obviously without that, we don't have a business.

Stephanie:

So when thinking about like the Crimson example, that's all from a bad ad being run on their website, correct?

Matt:

Mm-hmm (affirmative).

Stephanie:

Someone was able to buy that ad unit have bad JavaScript, and then that's when they were sent to that Verizon survey. I'm I thinking about that, right?

Matt:

You're totally thinking about that right. And what's interesting about the thread is that when this woman went on to Twitter and said, "Hey, this is what happened. And here's a screenshot," there were a whole bunch of people that piled onto the thread of like, "Oh, here's what I think is happening." "Oh, you have a virus on your computer." Or, "Oh, you have a bad extension on your computer or whatever." Everybody had a hypothesis of what's happening.

Matt:

And so we actually went and captured the threat and reverse engineered it and said like, "Here's exactly what's happening." And yeah, it's all coming through ads in that case. And there's so many great things of the open programmatic ecosystem.

Matt:

So programmatic media being able to buy a single oppression at a time by single user real humans, real devices, real networks, like you know I'm having a one-to-one engagement with this person and in the malvertising world, that's a feeding ground for bad actors because they get to do the same thing.

Matt:

And quite frankly, they're better at it than any other advertiser out there because they're the ones who know how to pay 20 cents CPM and buy an ad and actually get 100% click-through as opposed to the rest of the world that's just hoping that they get a half a percent click-through rate. And so they figured out how to buy that ad, that ad renders on your device.

Matt:

And then usually it's like an onTouchEvent. So when you actually just touch the device, they put a transparent overlay on your device. And that turns into a click or they'll auto click something on your behalf, or however they decide to inject their technology. But yeah, it's as simple as that. And I think it's lucrative, otherwise-

Stephanie:

They wouldn't be doing it, yeah.

Matt:

What they do is they try to do it at the lowest possible level without getting caught. So if you think about sophisticated marketers, what do you do? Well, you pick the right users, you maybe frequency caps so that you don't lambaste them with ads. You want to hit them at the right time with the right message and all that sort of stuff.

Matt:

And so these bad actors have figured out how to very elegantly and in a sophisticated fashion, they'll hit you with that ad. But the reality is they'll probably frequency cap you to one so you can't reproduce the experience and that's how they evade getting caught in most cases.

Stephanie:

Yeah. Very interesting. I didn't understand the whole backend of how that works. I mean, I do spend a lot of time thinking about building incentives for advertisers because we build up our own ad networks to advertise our podcast and we bring on partners all the time.

Stephanie:

And it's really funny thinking through how to build incentives for especially newer advertisers when you might say something like, "Oh, we'll incentivize you based on a download." Then all of a sudden you're getting all these fake downloads. No, not downloads. We'll incentivize you based on consumption. Like, does someone listen to the episode? They wanted to hear it.

Stephanie:

And then you see instead of actually having good people come through and consume the episode, the advertiser will say, "Okay, I'll pay you to review the ad or review the podcast, which makes it show that you were consuming it because you had to for maybe a minute to then be able to review."

Stephanie:

And it's always interesting trying to figure out, I mean, and these people are not good actors maybe, I'm not really sure. But it's always very interesting thinking, how do you incentivize people to do the right thing and actually deliver and not try and always get around the rules and just meet a number which I'm sure a lot of the platforms deal with the same kind of thing, but-

Matt:

It's interesting you use the word incentivized, and that was a dirty word in the early days where most advertisers didn't feel that the word incentivize was a good user because they didn't truly have the intent to do the thing that you want because they were being paid or a bounty or whatever the thing is.

Matt:

I saw the evolution of incentivized in my mobile career where it became really hard to get people to consume video commercials, like 15, six second whatever that metric was. And in the games world, they figured out this thing and they actually rebranded it instead of calling it incentivized video, they actually called it rewarded video. And-

Stephanie:

I feel like that's a little more, I don't know.

Matt:

Well, listen, and so I talk about one of the apps that I love is this app called Candy Crush. And I've been playing candy crush for almost 10 years now, I think. And when's the last time you played the same game for 10 years? Like never?

Stephanie:

Yeah. That's impressive.

Matt:

But they've artfully integrated video into their app. And I think if you run out of lives, you can watch a 30 second spot that is unskippable. So you have to watch the whole thing. And then if you, do you get rewarded with that extra life or whatever it is, maybe a lollypop, I don't know. But yeah, so I think there's different ways to approach it. But you're right, usually when you figure out the bounty, everyone else figures out how to capitalize on the bounty.

Matt:

And I think the interesting thing with Honey and Wikibuy is they've figured out how to get paid for the bounty or get credit for the bounty when lo and behold, they didn't really do anything. All they did was they had code that was resident on the machine that allows them to kind of get credit for that user purchasing when I think it's questionable whether they had any influence on that.

Stephanie:

Yeah. I've kind of thought that too, when seeing different Instagrammers with their promo codes for e-commerce site. And I always thought like, "Oh, how does that attribution work?" Because I mean, she's sharing it here, but I'm sure it's very easy for someone who doesn't follow her to also find that code outside of a Honey, but just be like, send it to my friend, "Hey, use this code." They never even followed her and now, they've got 25% off or something. So it does seem like attribution can be tricky, even if someone's not using Honey. How do you think that world's changing right now to make it easier for merchants to track where their sales are actually coming from? It feels very messy.

Matt:

Oh, I agree. I think it's a total mess. That's why we focused on the automation because I think that's one of those low hanging fruit, but big problems. Honey will tell the world that they have 17 million or so users. I don't know if Wikibuy which is now called Capital One Shopping, I don't think they announced how many users they have. But what I can tell you is both of those companies are spending a tremendous amount of money acquiring new users.

Matt:

Every time I log into Twitter, usually the first ad that I get is from Honey. All throughout the Christmas season, the holiday season just recently Capital One which owns Wikibuy Capital One Shopping, they were running TV commercials for this product with Samuel L. Jackson and John Travolta. So there's like a tremendous push for them to grow these user bases.

Matt:

In talking with merchants and we've got, I don't know, we've got maybe 25 merchants using our product right now. And we're in closed beta. That problem that you just mentioned, which is, "Hey, I worked with an Instagrammer and I gave them a code. And all of a sudden two days later, I've had a vitamin company tell me that story. I've had a sporting goods company tell me that story. I've had a toilet paper company tell me that story.

Stephanie:

They're using Instagrammers?

Matt:

They're using Instagrammers. They're using YouTubers. They're actually using podcasts as well.

Stephanie:

I mean, interesting to see how they're partnering on toilet paper.

Matt:

Because they're partnering for the audience on these podcasts and they're hoping that they can get that audience to find out about their product and again, then they're incentivizing them to come and become a customer. It's basically the same net story. The vitamin company told me they're like a supplement company. They partnered with one of the biggest triathletes in the world.

Matt:

Let's just say they had 50,000 or 100,000 followers, but you've got to imagine they're probably rabid followers. If you're into that, then that's probably the gold standard of who you would listen to. And that person did some blog posts and did some Instagram posts and posted their code and as soon as it happened, they saw a surge in sales attributed to that person.

Matt:

Now, the marketing person at the company was like, "Oh my gosh, we figured it out. We nailed this. We knew that people would be rabid about that person's content. We knew that person had so much influence to get people to come and buy." And then they're like, "Oh my God, it's Honey." Because literally they went from zero sales to 80% of their sales that had coupons was that person on Monday.

Matt:

I think it's a frustrating problem. And I think the sophisticated marketers have woken up and are like, "Man, we're bleeding money." One merchant told me that when they started kind of parsing out the attribution that Honey was costing them. They did about a million and a half in revenue online per month, so call it a $15 million business give or take. They believed that these promo code extensions were costing them about 150 grand a month, 10% their overall value.

Stephanie:

I mean, we just had a guest who they ranted about their hatred of Honey, I mean, even on the show. So I think it's maybe a couple episodes before maybe when yours is going to go out.

Matt:

Call me. We can help.

Stephanie:

Yeah, I'll send the link so you can hit him up.

Matt:

Absolutely.

Stephanie:

He was not a happy dude about Honey. But I guess when I think about promo codes, it kind of feels archaic to me. Maybe this is just a me thing, but it feels like where QR codes were where all of a sudden they're gone and you don't even think about them anymore. Promo codes kind of feel like that to me too of just, it feels like a manual old way of attributing things.

Stephanie:

How do you think about attribution when it comes to influencers and stuff or anyone, without having to use a code? Are you guys even thinking about a new way of doing things or do you hear of people trying new ways of attribution that isn't like I'm putting in a manual like Stephanie 20, to get my 20% off? Is there a new way of doing it?

Matt:

I mean, we're thinking through all those things. I think the challenge is specifically if you're using these one-to-many mediums. In a perfect world, I think you'd have a unique code for every user and so you'd have to authenticate. We'd know that that code went to you Stephanie and if you redeemed it, I would know that you actually bought something and you bought something because of this engagement that we had. I think in these one-to-many mediums it's, how else can you do it? And some of the challenges that the one-to-many mediums like think of YouTubers.

Matt:

One of the companies that we're working with has a problem where they have a very high dollar ticket item. Their item that they're selling is about 1,000 bucks. And obviously, if somebody grabs a code of 20% off that you're losing 200 bucks, it's a lot of money. Their problem was that they were doing YouTuber videos and they were publishing a code within the YouTube video to reach the audience. And for them, it was extreme sports, the audience that they were going after.

Matt:

Well, literally the next day, and I don't know if you know how Honey works. If you have a Honey on your machine, the very first thing that Honey does is it scrapes out anybody who manually puts a code in. So in order for Honey to be able to grab that code, it has to happen once where a real person saw the code and was motivated to go and type it in and buy.

Matt:

If that happened to me, if I got that code, I would go in and type it in. And if Honey were on my machine and then I hit okay, Honey will scrape that code out and now everybody who comes after me gets access to that code whether they saw that YouTube video or not.

Matt:

The problem for this company is spending a lot of money engaging with YouTubers and creating videos and obviously, doing the presentation layer of these offers. Well, once Honey gets a hold of the code... And what they've also found is that Honey and the other extensions, are not very merchant friendly. The relationship between Honey and these merchants is actually quite adversarial. And so it leaves them with no other option.

Matt:

I guess the two options: one, you just keep running your YouTube thing and you resign yourself that you're going to be paying out a 20% discount to everybody who comes and has Honey; which that stinks, that doesn't feel right or you need to reach out to the YouTuber. You need to recut the video. You need to recut the voiceover. You need to kill that code. You need to put a new code in. And so it's made this sort of marketing endeavor with YouTubers and Instagrammers and you name it very hard, because you're actually turning off codes.

Matt:

We saw one email which was interesting. I always say to people, let's remember we're all consumers too, you and I buy stuff on the internet, even though we're deeply entrenched in the businesses that we're running. I have Honey on my machine, so I can understand what that user behavior is, so that I can actually talk with merchants.

Matt:

One of the folks on our team bought a pair of shorts from one of these companies that advertises on Facebook and Instagram. And they were out of stock after he had ordered it, so they sent him an email. And they said, "Hey, listen, sorry you didn't have it but guess what, here's a code. You'll save X percent. But please, make sure you use it within the next 48 hours because Honey has been grabbing our codes and we're going to shut this code off."

Matt:

How can people market, if you constantly have to play whack-a-mole. And if you now think of the analogy, it's back to what we do in the malvertising side. If you aren't going to solve things with software, you're basically playing this long cat and mouse game that you won't win.

Stephanie:

I mean, that's why I think about merchants turning on and off codes.

Matt:

It's a nightmare.

Stephanie:

We were handing out swag and me just trying to... I had unique links that could work for more than one person and just thinking, "That could be tricky and go really bad." But I guess that's why I just think codes just feel, like I said, a little bit archaic. Why can't I just go to a YouTube video?

Stephanie:

I mean, the internet knows so much about me and where I'm at anyways. It should say, "Hey, Stephanie watched Matt's video where he was talking about this toilet paper." And then all of a sudden she's at our website, you can say, "Stephanie, a 20% coupon awaits you when you go here."

Stephanie:

And then when I get there it should know who I am and then be like, "Your coupons applied. And it will be applied for the next three days on this website or whatever, because I know where you've been and what you saw and where exactly you came from." Why can't it just work?

Matt:

I mean, I wish it was all that simple. Listen, we are taking obviously, technology solution to what we think is a longstanding and challenging problem. And in the malvertising world, the people in ad operations were literally playing whack-a-mole. Like, "Let's figure out where this bad ad came from." "Turn that demand source off." Or, "Turn that buyer off." And guess what, the bad actors, they just pop up again.

Matt:

And so we believe that, and I've seen and talked to merchants who are like, "Listen, here's how I solved the Honey problem." And they're like, "We actually created promo codes for 10% off, but the promo code was Honey is stealing your data."

Matt:

Because if you use Honey, you know that when Honey pops up it'll actually tell you the codes that it's implementing. They went on a mission to discredit and put the fear of God in their buyers that Honey was doing... They were like, "Honey is doing nefarious things with your data." And guess what, Honey D listed them as [inaudible].

Stephanie:

Well, there you go. Now, you know how to do it, I guess.

Matt:

The irony is, is that was three months ago that I talked to that merchant. And yesterday they cameback in and said, "Listen, we have a problem again."

Stephanie:

Honey added us again.

Matt:

No, this time they've got a Wikibuy problem. The problem is going to be never-ending, I think. Ultimately, we're hopefully going to give e-commerce companies the tools that they need to go out and be able to operate their business and focus their time on the things that really matter, in my mind, which is driving incremental revenue; not playing whack-a-mole with your promo codes and having to go recut YouTube videos. Hopefully, that's one of the big things that we help solve for.

Stephanie:

That's cool. I mean, I do like the idea of that one merchant you were mentioning where they said, "If you act within the next 48 hours or whatever, it'll only lasts this long." And I just had a guest yesterday who said that. I think it was either Burger King or McDonald's made it so if you're within 20 feet or something of a McDonald's they would send you a code and say, "You have five minutes to get to a burger King to get a free burger or something."

Stephanie:

And I'm like, "That's interesting." That's a good way to make people act quickly if you know something's expiring, I know I act a lot quicker. But I mean, of course, solve the problem that's number one. But I do think that's an interesting marketing tactic too.

Matt:

And make it measurable. I think that's the key thing is that... I often say, "What gets measured gets managed." And so hopefully, what we're doing is we're taking one of the things out of the equation that is making measurement really challenging for merchants. Again, using the triathlete example, yes, the marketer was high-fiving the rest of their team going, "We finally solved this." And then when they actually looked at the data they were like, "Damn it. I guess we got to go back to the drawing board."

Stephanie:

It's also just so tricky too, knowing how much of those people would have bought otherwise or not. So even looking and being like, wow, we have all this attributed to this one promo code and maybe it was because of Honey. But how many of those people would have bought if there wasn't some promo in there? It's just hard to know.

Matt:

We're solving that problem. We're giving merchants some deep analytics on exactly what's happening on their site, because we think there's a blind spot there where they don't know. For instance, how many users actually came to your site that actually had an injection capability? One of the extensions of Honey, Wikibuy, Piggy, Amazon Assistant, you name it. So we give them that lens.

Matt:

And then we give them the lens of, what were all the promo codes that they tried to inject? What was the most popular promo code? And stack rank those things and then going deeper down to conversion rate. And guess what, what we're seeing in these early days is that when you block Honey and Wikibuy at checkout, the vast majority of users actually still convert.

Matt:

And so that to me is the icing on the cake which is, guess what, you take control back of your website. You take control of your margins. You take control of your revenue. You now have the data you need to be able to go out and drive incremental sales. We think that's pretty powerful.

Stephanie:

I mean, that makes sense. I've heard a couple of times that also, discounts don't matter as much as you would think. I think they were talking about, they did a study between 10% off and 20% off. And actually, they were kind of the same when it came to consumer happiness. And what can be worse though, is if someone has the ability to go in and put a promo code in or something and then it doesn't work.

Stephanie:

I don't know if you remember those days of just going to the internet promo code for macys.com and trying out 10 different promo codes and all of them failing. I was way more unhappy then, than just not having one at all, just buying at full value.

Matt:

Let me tell you the opposite of that which is the worst-case scenario, in one of our merchants experience and that's why they're using our software. They're in the home interior space, so they do drapes and carpets and wallpaper and all that sort of stuff. And they were trying to build favor with interior designers because they wanted interior designers to know their site and know their stuff and all that sort of stuff. And so they did a very exclusive but unfortunately, a promo code that Honey got ahold of that gave interior designers 50% off.

Matt:

Well, lo and behold, as soon as one designer used that code and also had Honey on the machine, that code then got swept up in the Honey and everybody, every order that had Honey was now getting 50% off. Their customer service nightmare was that they couldn't afford to give every consumer 50% off, so they actually had to cancel orders; believe it or not.

Matt:

They called customers and said, "We can't honor your order with that coupon because that coupon was not intended for you." Created a customer service nightmare for them. And that's what they want to do is, they want to control their user experience. They want to control their revenue and their margins.

Stephanie:

Oh my gosh, that's horrible.

Matt:

Out of control. But think of that disaster of having to call someone and say, "Hey, I know you wanted to spend $500 with me, but only pay me 250 bucks. I can't give you 50 off but I can give you like 15 off, that's kind of what you were probably entitled to." So anyways, just trying to get control back in these merchants hands and let them control their destiny.

Stephanie:

I love that. When thinking about back to the now advertising piece, how much do you think it's on the publishing platforms? Is it their responsibility to make sure that they continue to increase their efforts to make sure bad actors aren't out there anymore?

Stephanie:

I mean, I know they're probably doing a lot. A lot of people like to hate on the publishing platforms and they want them to always do more and more and more. Is it maybe on them or maybe not on them anymore to continue to try and track those bad actors, who like you said are kind of popping up here and then they shut down and then open up a new account and do one off things and then shut down again. How should we think about leaning on the platforms like that?

Matt:

Well, I say to folks, the value chain in that industry is actually quite wide. And so from the bad actor who's putting their hands on the keyboards to the consumer, there's a whole bunch of players in the middle. I think it's on everybody to really have defenses in place and to make sure that they're protecting...

Matt:

So if you're at the front end, if you own the demand side platform that the bad actor's using, you need to have your own checks and balances to make sure that you're not bringing in malicious buyers. But all through that value chain, the onus is on everybody. But at the end of the day what I say is, the only person that can be responsible to that end user, is the publisher.

Matt:

Pick your publisher, if you are Fox News or you're the New York Post or you're the Washington Post, you're the one that has that ultimate relationship with Jenny or Johnny consumer who is surfing your site and consuming content. So you're the last line of defense. You're the one that created the site. You're the one that drove the traffic. You're the one that is using ads to monetize your traffic. It's really on you I think, ultimately.

Matt:

Now the publishers, all those folks that I named and there's millions of them, they all want to look upstream and they should. And they should hold everybody accountable upstream. But I think they're the ones that are really the that last line of defense.

Matt:

Because if you go to one of these sites and you have a crappy experience, you don't really care that it came through an ad. Like the woman at Harvard Crimson last week, she didn't know the origins of why it happened. And here's the other crazy thing, she knew that when she went to the Crimson, she was delivered a crappy experience.

Matt:

Now, the crazy part. First time we've ever done it, we actually did a private webinar with the end user because we wanted to explain to her here's exactly what's happening. She told us this story, she said, "Listen, I use ad block." And obviously, the risk to publishers are, if you don't create great experiences, your users are going to start using ad block.

Matt:

What she said was, in the desire to get real news and in the desire to really understand what's going on in the world and in the desire to actually make sure that real news publishers are actually getting compensated, she turned her ad block off and this is what happened.

Matt:

So shame on the Crimson for not delivering a great experience, because guess what? Now that user's like, "I'm not turning ad block off the next time I come to your site. You're not going to get paid for the traffic that I'm going to generate." So again, it really goes back to the publishers, the onus is on them.

Stephanie:

And thankfully, I think there is like new technologies popping up that maybe we'll be able to enable them or even just thinking about implementing. I mean, I've seen some advertisers looking into blockchain and having that as being kind of like a more source of truth to be able to know a one-to-one relationship and knowing who's behind... You don't know exactly who's behind what, but if you have it in a way where they sign up and they can't just start creating a million different accounts because they've got their one single one that they can go off of, it seems like there's a lot of ways that it can improve over the next couple of years that maybe hasn't been so easy the past decade or so.

Matt:

I agree. Obviously, there's industry bodies all trying to figure this out together. There's companies like us who are innovating and coming up with new and unique techniques to block these sorts of nefarious actors. I do think the biggest and most important thing is to recognize that the bad actors aren't just sitting still waiting for somebody to solve this problem. They're innovating honestly, a more rapid rate than many of the industry leaders that you would expect that have hundreds or thousands of people trying to solve this problem. Bad actors unfortunately, are innovating at quite a rapid pace.

Matt:

So the problem I think is going to evolve and change. We've seen it evolve to not just being ads but obviously, compromised Chrome extensions that just seems to be a great vector. And so I think you're going to see the problem move around and especially, if there's a lot of money in it. If there's ways for these guys to make money, you're going to see them salivate with... You're going to put up this defense and they're going to figure out this way to get around it.

Matt:

And there's so many different browser types. There's so many different machines. There's security flaws. There's zero-day. There's so many ways for these guys to actually buy and target, to only focus on iOS 13 and below and blah, blah, blah to reach their audience.

Stephanie:

So tricky. Hopefully, it'll get solved over the next decade. Cool. Well, with a couple minutes left, let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Matt?

Matt:

I am ready.

Stephanie:

All right. First the harder one, what one thing will have the biggest impact on e-commerce in the next year?

Matt:

Listen, I think it's been the gold rush for e-commerce merchants over the last year. In many cases I talk to merchants, they're like, "It was raining money last year." Sales were up five X, 10 X, who knows. I think the next year is going to be that year where folks actually look to efficiency, and they look to figure out where there are holes in the boat that they haven't had to look before.

Matt:

And I think that plays to our product because I think in many cases when it's raining money, you almost turn a blind eye to some of these sorts of things. But I think now folks are like, "Listen, if I can be more efficient. If I can take control of my revenue and my margins, I'm going to do that."

Matt:

So I think that's probably, this is the year of people now are catching their breath and they've figured out their distribution and they've figured out their fulfillment and their warehousing and all that sort of stuff and the panic that they had to do to keep up with the pandemic growth. Now, I think it's a deep breath of like, "Okay. Now, let's look at the math."

Stephanie:

Yeah. I agree, that's a good one. What one thing do you not understand today that you wish you did?

Matt:

What one thing do I not understand. I think the affiliate landscape is complex. I think there are a lot of legacy ways in which people have calculated incrementality and I'm not sure if they're all believable. And I hear a lot of feedback from merchants where it's kind of like they just brush it under the rug and they're like, "I know I'm probably paying for stuff that I didn't really get, but let's just let it go." I think every percentage point matters. That ecosystem, because I hear there's good guys and there's bad guys and I'd love to really dig deeper on that. And I think that's a big opportunity for us as a company.

Stephanie:

That's a good one. What's the nicest thing anyone's ever done for you?

Matt:

Wow. The nicest thing that anyone's ever done for me.

Stephanie:

I like to go deep.

Matt:

Yeah. That's a deep question. I think I've been fortunate throughout my whole career in that, I have been given opportunities that I probably wasn't ready for. And by the way, I had never been a CEO before I was at this company. And so, who knew that I'd be able to do it.

Matt:

But I think it actually starts way back to when I first graduated and I was seeking my first job. And I had a mentor that took a risk on me and gave me my shot. And I worked my butt off and hopefully that translated and he and she felt great about what I was doing. So I think the nicest thing, I've just been given opportunities that I don't think I deserved and hopefully I earned that respect and trust over time.

Stephanie:

That's a good answer. If you were to have a podcast, what would it be about and who would your first guest be?

Matt:

Wow. This lightning round is hard.

Stephanie:

Good. Needs to be.

Matt:

If I were to have a podcast. I love gadgets. I'm one of those guys that buys the infomercial type stuff. I bought one of those Rotisserie Showtime girls 20 years ago, I still use it.

Stephanie:

Worth it.

Matt:

Maybe it could be interviewing people who've built made for TV products and really understanding the backstories behind how they came up with the idea and how successful they were and God knows how much money we all made them.

Stephanie:

That's good. We had Kevin Harrington on the show, he was the original OG shark in Shark Tank. He basically made the infomercial. And it was very interesting hearing his perspective of how it started, where it's at now and Shark Tank.

Matt:

I'm fascinated by that ecosystem, it's super cool. And by the way, I always do buy one of those stupid things for my wife for Christmas and she hates me for doing it because she's like, "You're just burning money."

Stephanie:

I had fun buying it and watching the infomercial today.

Matt:

Believe it or not, one of my coworkers gave me a Squatty Potty for Christmas.

Stephanie:

I actually feel like those have good value though, the science is there. It's just a weird thing to buy your wife, if you got that for her. Someone gave it to you, got it.

Matt:

I was given it, by one of my coworkers, "By the way it works."

Stephanie:

And their marketing, I think that's the Harmon Brothers who did their marketing with the whole unicorn and they did the Poo-Pourri thing.

Matt:

Oh yeah, it's super cool. I love those kind of gadgets.

Stephanie:

That's a good one. I would listen to that show. All right. And then the last one, what's up next on your Netflix queue?

Matt:

Well, on my Netflix queue, I think I've got three episodes left on the Queen's Gambit.

Stephanie:

Love that show. That was a good one.

Matt:

I'm a documentary guy. I actually will tell you that I've been kind of hooked on HBO Max for a little bit. And I just finished the Tiger Woods documentary last night, which was fascinating. Nothing that you hadn't been told before. This guy through adversity has come back multiple times; knee surgeries, winning on a broken leg. So I'm into those sorts of stories. One of my guilty pleasures is The Bachelor, so it's on my DVR. I'm playing catch up on that.

Stephanie:

That's great.

Matt:

I love reality TV and that sort of stuff.

Stephanie:

I like where your head's at, me too. Well, Matt, this has been a very fun interview. Where can people find out more about you and clean.io?

Matt:

So you can find me at matt@clean.io. So if you want to send me an email, obviously happy to help you guys in any of your challenges and would love to hear your challenges if they're similar or if they're different than ones that we're solving for. Hit me on LinkedIn, so you can find me there. And our company website is clean.io.

Stephanie:

Awesome. Thanks so much for joining us.

Matt:

Thanks Stephanie. Thanks for having me.

A Tool For Every Ecommerce Need

info@mission.org (Mission) — Tue, 9 Feb 2021 08:00:00 +0000

For more than two decades, Dan McGaw has been engrossed in the world of marketing technology. And through the years, there has rarely been a new MarTech tool that Dan hasn’t given a shot. Why has he placed such an emphasis on knowing the latest tools available to marketers? Because every company, big or small, needs to invest in tools that will elevate their business rather than slow it down. Some tools are better than others, and sifting through the rubbish to find the diamonds is a daunting task. That’s where Dan and his company, McGaw.io, come in.

On this episode of Up Next in Commerce, Dan discusses all of the marketing technology he’s bullish on at the moment, and why he believes ecommerce companies will be investing heavily in certain tools and operational activities. From campaign tracking, to multi-touch attribution, to recommendation engines, to personalization, Dan’s toolbelt has a tool for you, and he also has some comforting words for anyone who is worried about the potential of a cookieless future.

Main Takeaways:

Text Me Back: Companies are misusing SMS messaging as simply a way to send promotional messages. Instead, brands should think about texting as a way to open two-way communication with their customers, especially through the use of direct questions and interactive exchanges.
An Easy Way to Personalize: There are opportunities to personalize the shopping experience that are being left on the table. Brands reflexively choose the easy option of sending a cart abandonment email reminding users what they left in their cart. What would be more effective is sending an email that utilizes their entire shopping history, including things they didn’t add to their cart. Just because they didn’t add a particular item, doesn’t mean they weren’t interested. After all, they simply could have been distracted or otherwise disposed of before making the transaction.
C is for Cookie: Despite the fact that many people are worried about the death of third-party cookies, they will not completely disappear. And, in fact, there are actually already alternatives to cookies available that work in a similar way. Find out what they are and how to use them by tuning in!

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone and welcome back to Up Next In Commerce. This is your host, Stephanie Postles, co-founder at mission.org. First things first, I would love it if you could hit subscribe and leave a rating and review, let me know how I'm doing and what you guys are interested in hearing in the future. All right, onto the show. Today, we have Dan McGaw, the CEO and founder of McGaw.io. Dan, welcome.

Dan:

Hey, how are you today?

Stephanie:

Good. How are you?

Dan:

I'm doing amazing. I'm living the dream right now. So having a ton of fun.

Stephanie:

You are. So tell me a bit about McGaw. So I was reading about your background and what you were known for, and someone called you the godfather of the marketing tech stack and one of the original growth hackers. So if I'm setting you up big here, let me know. But tell me, how did you get those names and what does your current company do?

Dan:

Yeah, great question. Well, I got those names from other people calling me, which is pretty fascinating to say the least because I remember the first time that I heard that I was like, "What?" But then it kind of caught some legs. So I've been in this space for over 20 years. So I've been doing marketing technology marketing since 1998. So I've been doing mass emails since before mass email was even a thing. So I just have been around for a really long time and I've been in the marketing technology space since before there was even a concept known as marketing technology. So definitely have had a long history of doing this. I've been an entrepreneur for a long time, even have been, another funny, fancy title that I was given is I am a United States ambassador of entrepreneurship.

Stephanie:

I saw that too. I didn't know what that meant though so I was afraid to put that one out there.

Dan:

Right? So I was selected by the United States State Department to be an ambassador of entrepreneurship to Mexico and I was flown to Mexico and I had to advise a bunch of companies and corporations and colleges on how to build entrepreneur ecosystem. So it's just been really fascinating. I think that the big thing that I will just say is I have a really big mouth and I'm always out there doing something stupid and I'm not afraid to say how I feel. So it's kind of wound me up with some cool places and I've done some really cool stuff, but yeah, I've had an amazing career. Everything from working at a cemetery, to making pizzas to now of course doing some really bad-ass marketing technology stuff. So I hope that helps.

Stephanie:

So what'd you do at the cemetery? Now you've piqued my interest there. We'll just have a conversation about that now.

Dan:

Yeah. Right. And that was the creepiest job I've ever had, but so awesome. I just did, I was a lands crew person and I weed whacked and I blew leaves. I think I was 14 in middle school, but I've always had the hustle so I just wanted to work and make cash. And I mean, I started my first company when I was 13 and was very successful in that business. So I've always just wanted to make money and that's actually how I got into marketing technologies. I saw marketing technology was going to blow up and we chose a vein in there and stuck with it and it worked out really well.

Stephanie:

That's cool. So how did you see that area was going to blow up? I mean, you're saying that it was before there was even a terminology around it. How did you see this as an industry I want to get into and now I know what to actually do to even be helpful.

Dan:

Yeah. Fascinating question. So my first company was basically in the music business. We started one of the first online booking agencies for DJs and producers. So everybody here has probably watched the Fyre documentary on Hulu or Netflix. I literally did that same exact business except for I was not a fraud, which is so fascinating. We started an online website and bulletin boards marketing DJs and producers that basically would do raves. Today we now call it EDM and it's all this big billion dollar industry, but back then it was like nothing. And I was just young and didn't know what the hell I was doing. And so I said, "Hey, we're going to figure out how to promote these DJs because I love raves like any ..." What 13 year old goes to raves? But either way-

Stephanie:

Yeah, really. Where are your parents? We don't know where Dan went. He's been gone for a week.

Dan:

Supporting me a 100%, crazy enough, but I started that and then really started figuring out the internet and none of our competitors were using the internet. They were still just like relationship based. And as we went through that process, I learned a little bit about development, HTML and nobody was doing anything. So so far in like those days, AOL didn't even have a concept of mass email. You had to get white listed to send mass emails. So I just kind of started doing it to come to find out that there wasn't really any technology back then to do this stuff. So before there was all this tech to be able to make it happen, I was already kind of making it happen manually. So I got really involved, naturally Google analytics which was urchin came out and like ad tech became and there wasn't MarTech. It was just ad tech at the time, Google analytics and traffic tracking.

Dan:

I got really big into UTM tracking, which is kind of the first bit of it. So fast forward a little bit to like 2000, I think like 11 or something like that, Kissmetrics was a large analytics company. I got hired there as the head of marketing. I was hired to replace Neil Patel, one of the founders. So I wound up becoming like the head of marketing at one of the rocket ship analytics companies. But all the stuff in between the middle there was kind of you just made it up as you went. And then 2011, 2012 was when MarTech kind of like took off and I saw that as a humongous opportunity. So I've just kind of have stayed in that industry.

Stephanie:

Okay, cool. And what brands do you work with today for context?

Dan:

Yeah, really, really good question. I mean, our clients weren't ... So our company mission is to help companies of all sizes realize that their customer data is their most valuable asset. So we work with some really, really small companies all the way up to some really, really big ones. So some big ones that people would know like King's Hawaiian Bread. We do a lot of their implementation work. We are managing their ecommerce. Hydro.com, which is like the Peloton of rowing. We do work with them. Some other people might be familiar with like forksoverknives.com. They were a long time client of ours. We no longer work with them, but I mean, we helped blow them up. These are some really popular brands that people would be aware of, but we also work with some of the MarTech companies. So even Kissmetrics has hired us. Segment.com has hired us. Looker which is owned by Google has hired us. So it's really across the board. It's been a lot of fun.

Stephanie:

Cool. And what kind of challenges do you see the bigger brand struggling with today? And is it kind of similar to maybe with the smaller brands that you work with? Like same kind of thing or are they very different problems you have to focus on?

Dan:

I think the problems are exactly the same. I think the tactics which are being used are slightly different because the tool set changes, but there's two primary problems that most companies have and that's when they come to us, which is great, is they either lack visibility into their customer journey or they lack the ability to engage in the customer journey. And this is a pretty big problem that every business faces is that they can't see what's happening in that customer journey or they can't act in there. And that's where the marketing stack which is what our specialty really is, is we help companies basically connect all the tools together, integrate them, operate them and be able to gain visibility into that journey so they can provide engagement there.

Dan:

And this is one of the biggest problems that you're facing in marketing today because everybody's figured out ad tech. Everybody's figured out email automation and everybody is kind of trying to figure out analytics now, but there's still this huge middle and bottom that nobody understands and that's really where our company kind of sits nice and sweetly. So the customer journey is huge right now. I mean, that's what everybody's focused on.

Stephanie:

Cool. So where do you see companies going wrong right now in the customer journey? Like are there similar things or like you guys all keep doing the same thing and it's messing everything up or is everything very different, all the problems that you maybe discover as you were starting to look into how the brands are operating.

Dan:

Yeah. The biggest thing that we see that that's fairly consistent, and it's the thing that no marketer really focuses on is it's the taxonomy of the integration. So like what does taxonomy mean? So every time that somebody does an action or we learn an attribute about somebody who's coming through our funnel, that's got to have a name to it. It's got to have a label or as you might call, nomenclature. We've got to all call it the same thing. And that's a big problem that we see across organizations and I'll try to put this ... If you're working with an online education company, the marketing team is calling it a signup, but the development team is calling it an enrollment, but customer success is calling it a registration. And the problem is when this happens and the data all goes into the systems, you now have three attributes for the same exact action, and it makes it really hard to tie all these things together.

Dan:

So the fundamental problem that we see most companies have is that they just don't have a consistent taxonomy across the stack. So when they finally start looking at the customer journey, they have it all in different namings, and then they have to spend all their time transforming things to get them to line up. So that foundational thing is the last thing everybody focuses on, but when they get that right and it works across the entire stack using a unified taxonomy, which sounds so technical but it really isn't, they really are able to create magic because now everybody is calling the first name of a customer by first underscore name in the analytics, but in the attributes you see in marketing automation is Fname. Right? So that's usually the key problem that we see is that taxonomy is wrong. And then the second problem that we see is that the tools are not connected.

Stephanie:

Yeah. So it's funny talking about how the taxonomy is wrong. A lot of people listening might be like, that's so easy. And I'd say for a startup like starting out, it's very easy if you know to do that from the start. Like of course, have your variables, make sure they're exactly what you want and train people up, have your data dictionary, whatever you may have so everyone uses the same term. But actually when it's a bigger company which I've seen like back in my Google days, everyone's operating off different things. How do you bring the org together and all the different departments to be able to not only agree like this is the variable, but then make sure everyone's using it that way? Because that's actually a lot trickier than I think some might think.

Dan:

Yeah, it's extremely, extremely hard to get that cross department alignment. And it's fascinating because like this is one of the things that a growth team would ultimately help with, is kind of cross department alignment in regards to these things. But growth is always focused on action, not necessarily planning. So a new companies or I don't want to say new companies, excuse me. The new role a lot of companies are rolling out is revenue operations, marketing operations, sales operations, revenue operations is the big position that SaaS companies are hiring because it straddles across marketing sales and customer success And that's the big thing that's happening. And I think in a lot of the enterprise companies, you're going to see a lot more of these revenue operations style roles that are coming out that try to align it.

Dan:

Because everybody's realizing if your data's crap, okay, great, we can't do any of these cool things. This is where a lot of companies are getting their CIOs involved. I think the conversation over the past two years has really shifted away from, hey, we're just talking to marketing technology. So now the CIO calls the shots for all of this because the CIO is the one who makes the decision on business intelligence and all that. So I think a lot of CIOs own the problem. I don't think that they understand the problem because it's outside of their purview, which is sales and marketing. So I think it will be really, really hard, but it's really important for a company to have good data. And without good data, you're kind of, you can't do machine learning, you can't do artificial intelligence, you can't do personalization. But right now it's the CIO, which I think needs to hire the revenue operations person to really get that done.

Stephanie:

Yep. Yeah. And a side note, if anyone's like, "I really want to hear more from CIOs," we have a whole podcast called IT visionaries where we interview CIOs from fortune 500 companies. So go check it out. So okay. You get your data all set and correct at the company that you're working with. What's the next thing that you encounter that's either an issue or that you see happening a lot right now?

Dan:

Well, I mean, just to make sure, I mean, the taxonomy, the data dictionary like you said, which I think is possibly a more common term or a schema. I mean, there's just so many ways to call this, which is ridiculous. The integration of the tools I think is really, really important. A lot of companies don't understand the way that tools can now integrate. We have a concept that we call data recycling. You typically see companies that are looking for what's known as we want our source of truth or our single record of truth. And for us, we find that to be a really, really bad model. What you should be trying to do is mirror your data across many, many different tools over and over and over again, and then recycle this data throughout the entire tools. If you have a single record of truth, which is always great, that means that you're helping one team and holding back many other teams.

Dan:

So we try to make it so that we recycle the data as much as we can and that's through basically data recycling. Leveraging a customer data platform is always really helpful for this, leveraging tools like Zapier, leveraging tools like tray.io, Workado is always really, really good, but you have to string the systems together along in a very, very structured manner to make it so that that data can even flow. Because even if you call everything the same, if nothing's connected in the right way, you're still not going to make any progress. So integration is also a key part of that.

Stephanie:

Yep. Cool. So now thinking about a little bit farther down the line like maybe when it comes to actually either interacting with the customer or guiding them around on your website or something, what things can be improved there because I've talked to quite a few companies or people on this podcast who say, "Any plugins, get away with all the plugins, they just slow your website down. You just need to focus on website speed. But then you were mentioning earlier how much do you love tools, and so tell me more about that.

Dan:

Yeah. I mean, I definitely think website speed is extremely, extremely important. I mean, when you're a large ecommerce company, speed is obviously paramount because it affects everything from SEO rankings to people actually converting on the website. But I also think you have to very much focus on personalization and creating a customer journey for the user. I think there's two kinds of use here. I mean, one marketing automation is great because it enables you to do so much, but sometimes we lose the human element and we kind of forget that people are still humans. They want to have a communication channel with us. So you want to make sure that you can personalize the experience and tailor that experience as much as you can. But at the same time, you just don't want to overdo it. So we focus a lot on personalization throughout the website, getting people back to where they want it to be, back to where they left off.

Dan:

And this would be, so as an example where you don't want to use a plugin because you want to let them use their experience. As things are happening on the website, we can track that in real time. We can save that in marketing automation, we can save that in any tool. So when the person leaves the website, we can very easily send them an email saying, hey, picked up where you left off. Especially if it's ecommerce, right? Last product that they viewed, they don't need to add it to their cart. I think it's the stupidest thing that we do. We send cart abandonment emails to people when they add something to their cart, because we think they have interest. If you send people an email which showed them the last five items that they've viewed, it adds the same value, right?

Dan:

Just because I added it to my cart, yes, it means I'm interested. Just because I didn't add it to my cart doesn't mean that I'm not interested in it. It means I probably have a five-year-old that's distracting me and I didn't get to add it to my cart. So we see allowing people to pick up where they left off as a really, really easy thing to do. But personalization in helping them accomplish their journey I think is the biggest thing. Marketers job is ... I come from a developer company where the marketer's job was, we were there to manipulate and trick people. And it's like that's not my job.

Dan:

But a marketer's job in my opinion is to basically help somebody accomplish their goals by serving them what they wanted in the first place. Right. It's to create that magical customer experience, knowing what they already wanted and serving them that on a silver platter, not tricking them to figure out, oh, you should've bought this, right? And I think that's where growth hacking went bad a few years back is it got a little like slimy and really it's about how do we just create the best customer experience for them through personalization?

Stephanie:

Yeah. So sometimes I think that personalization that I could see it going too far and I've talked to this a bit on the show before of like when you call in on the phone and it's like a robot and they're pretending to type, and they're trying to personalize it to your name and they're jacking with your name or sometimes you get an email and it's so over the top, like Stephanie, I saw this, this and this and it made me thought of you and whatever. I'm like, "Oh, creepy." How do you walk that fine line of giving people something that is helpful, but not being creepy.

Dan:

Yeah. And just because you're using the word creepy, it brings back some awesome ... I have a webinar and deck that I did before COVID happened. I was traveling the country doing this talk about automation without being creepy. But what does creepy really mean? So what I advise everybody who's listening to this podcast, grab your cell phone and I need you to go to your text messages and I want you to text (415) 915-9011. I'll just say a number again, (415) 915-9011. And I just want you to text the word creepy to that number and then follow along with the text prompt. There's a bot that will follow along with creepy. And then if you're really, really well known on the internet, you're going to get a super creepy email that will surprise you on what the internet already knows about you and that we have access to through your email. So either way, nice experiment for your people to go try, but-

Stephanie:

I want to do that now. Now that piques my interest. I don't know if I'm well-known enough on the internet though, but we'll see. It'll pull things from like Facebook. I'm like, "Here's what you're doing, Stephanie, back in high school."

Dan:

Yeah. We'll see. I mean, and usually the minimum that you're going to get is like we get your zip code or it might have your wrong zip code, but there's for myself and had over 300 attributes. I was like, "Holy crap, the internet knows way too much about me." But that being said, you do follow this line of creepiness to straddle, right? And you have to understand like target as an example can predict with nearly 90% accuracy that you're going to be pregnant within three months or you are pregnant within three months and that's crazy data science that you have and that blurs the line of creepiness. What you have to understand is that you don't want to impact life moments like that. Always, you don't want to precede those things, but what you have to figure out is how do you understand what they're looking for and then just serve that element to them?

Dan:

Because with an email address and with your IP address, we can basically find out anything we want, which is really, really terrifying to think about. So you have to make sure that you're just superseding what somebody is probably already looking for and there's definitely enrichment that you can get. So knowing that it's raining in somebodies area and sending them an email is not necessarily a bad thing, but you don't need to tell them that you know that you know it's raining, right? Like don't say, "Hey, it's raining, you should buy an umbrella." But yes, it's okay to send them umbrellas and rain boots and things like that, which banana republic knows how to send emails based upon that but they don't say it's raining. So there's a lot of ways that you can be helpful to somebody without telling them that what you're doing. But I mean, you can be really creepy if you want.

Stephanie:

I mean, I think that it sounds simple, but I like that where it's you have all this information, but you don't have to be like, "Hey, here's the zip code you live in? And apparently there's this festival going on right now." Like you can send something where it's like, oh, how did you know? Cool, okay. That's helpful because now I know of an event or whatever nearby without you saying, I know exactly the attributes of why I'm sending you this email because of this or whatever. So that's interesting.

Dan:

Yeah. There's an API for that too. When you talk about the events, I immediately think of companies that have APIs that allow you to have events and people's areas. So definitely an API for that nowadays.

Stephanie:

There you go. So what are some of your favorite tools that you're using where you're seeing the biggest success with right now? And it can be marketing tools., it can be stuff around like helping the customer journey. I mean, what comes to mind where you're like, "Oh, 2021, I'm really leaning into these things or we're implementing these things on our customer's websites."

Dan:

Yeah. So there's probably two primaries that I would go with. One, I'm super big fan of text message marketing, but I think a lot of companies get it wrong in the fact that they use it as a promotional channel and they use it as spray and pray. So I think text is really, really big. We use a software called autopilot, which is our marketing automation tool. They have an integration with Twilio so you can build a Twilio bot. So earlier I said, "Hey, text this number and text this word to it." It adds you to a subscription list and then it will automatically send you information and it can talk back and forth with you. And those types of technologies are where you really get some interesting engagement from consumers in regards to your services. So definitely is a real unique channel, but I wouldn't say that that's something that you would leverage on your website all the time.

Dan:

However, as somebody's going through your checkout flow and you collect their cell phone information, this is a way that you can reach out to them. Hey, we shipped your order to you and it has arrived today, right? Provide them helpful tips and then say, "Hey, you received your order. On a scale from one to five, how did it arrive?" And things like that. And providing this two way communication channel is really, really good for consumers. It gives them a communication channel. You do have to connect it to a support system and things like that. But customers really find it unique when you're trying to have a two-way conversation with them compared to like buy my 20% off thing.

Dan:

People hate getting those spam promotions. They hit stop more than you would like to think. So I think that for me, leveraging the SMS bots, whether that be through Autopilot and I think there's a company called Text In, which does really, really good there. There's another company called salesmsg.com. And no, I'm not talking about the Panda Express MSG, but salesmessage.com. They're more integrated with HubSpot or more meant for sales teams, but they work really, really good for customer support too. So text is huge for me. And then the flip side-

Stephanie:

How do you think about engaging people in texts? Because that's an issue where, I mean, I even think about like World Market right now just sent me a text this morning, like oh, 20% off. They send it to me like every week. I'm like is every week, 20% off week? I start to lose interest and I just haven't had the time to hit stop yet. But how do you think about building a flow that's going to keep your customer actually engaged and excited to see your texts coming in? So I feel like it's a two-way thing instead of just blasting them with promotions.

Dan:

Yeah. It's got to be really personalized. And this is why when we think about text messages, we think about it from a helper perspective. Right? So we have to think about like the things that are going to optimize their customer experience, not the things that are going to help us, right? Sending somebody a 20% discount is not helping them, that's helping us. So when we think about the change in that fundamentals is of course like when somebody is coming through your website, like hey, you can of course, hey, do you want to be updated with sales and promotions? Right. But I would target it more, hey, do you want to be made aware when we launch new skirts or hey, do you want to be made aware when we do these specific things, and try to only send the messages what's they're requesting which is going to help them in whatever they're trying to accomplish.

Dan:

And you get unique opportunities like when somebody is going through the checkout experience, right? Like, hey, do you want us to keep you aware of certain things that they're already interested in or hey, do you want to be shipping notifications? Do you want us to keep you aware of your shipping notifications? And those are good ways to get people going, but asking questions is going to get you much more than, hey, here's 20% off. Right. So I think asking questions, that's where the bot part comes into play is asking the question, like do you feel that our customer experience is optimal? Can you reply back with a one to 10 on how your checkout experience was? People respond back with a seven or two or a five. That's the interaction they're looking for, not hey, here's 20% off, right?

Stephanie:

Yeah. Unless you walk in the door. That's when I always think I'm like, if I walk into the door of a retail location and then I get that text, cool. I'm happy with it. But if you're just sending it to me when I'm at home ... Yeah. It is so possible. I know I'm like, they've got the beacons in the stores, you can do it. There's so many ways to do it now, but I don't see many brands at least retail locations doing that quite yet. But maybe I just don't go into retail stores obviously.

Dan:

Well, yeah. Yeah. The retail stores is hard. Yeah. I mean, I definitely think if anybody on this podcast wants to do that, let's do that because I know how to do that, leveraging radar, mobile apps and all that stuff. So like totally cool. I think my favorite campaign was by Burger King. They said if you were within 500 meters of a McDonald's, we will send you a free coupon for a free Whopper and you have five minutes to buy it. So if you had the Burger King app, came in within 500 meters or so I think it was even maybe a hundred yards of a McDonald's, you would get an instant push notification, you have five minutes to get your free Whopper. Holy crap. I mean, can we say contextual?

Dan:

But yeah, that's all possible. I agree with you. If I walked into JC Penney and JC Penny sent me a 10% off discount, I would totally use it. We were working with an ice-cream retailer, which I can unfortunately say the name. They're trying to create a loyalty program, but they couldn't figure out how to do it. And we're like, "Dude, just put a fricking number on the side of your building that says text loyalty now to this number and you're in our loyalty program. And then connect that to beacons and you can do more stuff with it, connect it to your app and do more stuff with it." And-

Stephanie:

Did they do it?

Dan:

No, they didn't listen because they were too traditional, who needs technology either way. But [crosstalk] is super powerful.

Stephanie:

That'd be a really good thing to do now that I'm in Austin area. So hey, anyone listening from Austin, give me a shout out. I'm here now. Yeah. But that's a good area to do that because there's so much like artwork and graffiti that turns into artwork on all the buildings out here, but people pay attention to it. So I think it does depend on the city you're in of like, are people open to that or will they see it and be like, "Man, there's writing on a building."

Dan:

Yeah. I think text is awesome. I mean, you just, people suck at it and I think people suck at most marketing in general. They just try to spray out there and hope for the best. So the one other technology, there's two technologies that we're testing a lot right now. One is called ConvertFlow, convertflow.com which is really, really good. The other one is right message. And both of the technologies are relatively the same. They're a pop-up technology that happens in your website, except for they're integrated in with your marketing automation solution and they also track a lot of what's going on on the website. So you can provide real time personalization to the website based upon what people clicked or what people did. And for anybody who follows the B2B space, there's like these drift chat bots.

Dan:

So if somebody comes to the site, a pop-up comes up, what is your goal today? Did you want to see a demo? Do you want to see this? Do you want to see this? People click on it. And then only the chat bot is able to control like what happens next. The difference with these technologies, specifically ConvertFlow is that when those types of things come up, you can click on something, it will drive you different places on the website, but it can also change the headline copy of the page. It can also change like things that are happening. So if somebody comes back, it can be like, "Welcome back, Dan. We hope that we were able to help you in your last visit. Last time you left off, you were looking at socks, let's go look at socks again, right? Or is there something else we can help you find?"

Dan:

And then of course you could constantly be contextually changing the experience for that user. For us, ConvertFlow has one of the most powerful engines to it and it's super cheap. These two twins created the platform, super, super cool guys, but they're really good at that. And then the flip side would be right message, which right message is more of a kind of a chatbot-esq. It doesn't change your websites, but it does constantly provide you personalization to push people down the funnel based upon what they sent.

Stephanie:

Cool. Like how many tests should a company be running to see what works and then how much should they pull it back and narrow it down to?

Dan:

Yeah, man, you should be running tons of tests. I mean, there's a linear line between the number of tests that you run and as well as the growth that you can create at a company. So I would just say you should run as many as you possibly can, that you can hit statistical significance with, speaking of which we have a tool for that. If you Google AB testing calculator Chrome extension, go check it out. It'll help you know if you have statistical significance. But yeah, I mean really, you should be running tests all the time. You shouldn't be launching anything that's not a test in our opinion. That's a big part of our business.

Dan:

So companies like Hydro, we run all of their AB Testing experiments and we're always running tests, right? So like for me, you should not be doing anything unless you're testing it. The thing that I would just add as a caveat of that is you have to have enough traffic to run the test. You have to hit statistical significance and you have to know what you're doing from a data perspective because false positives, I lost a company $125,000 in 24 hours because I had a false positive. I made a mistake. Luckily, this was a long time ago, but-

Stephanie:

What was the false positive? Tell me the story, or backstory of that.

Dan:

Yeah. I mean, a great problem that you have is that people only focus on one metric. So when you create an AB test, the test, I worked at a company called codeschool.com. Going back to that developer centric company, we were an online education company for developers. We created an experiment called the summer school campaign or summer camp campaign. And I had optimized the AB test for sign-ups and then purchases. The problem was we didn't optimize the test for lifetime value. Lifetime value was 75% less on the winner of the test. So we saw an immediate increase in conversions. We got super, super excited, come to find out that those users were 75% less valuable based upon that test.

Dan:

So there's a thing known as you have to basically reverse look at tests. So when they've been running for two months, go back and look at that to see if it hurt lifetime value, it hurt retention, anything like that. But we basically had just wrote a headline, which wasn't 100% percent true to the developer. Like it wasn't 100% in line, so they wound up churning after their first I think it was two months. The other users who didn't see that headline stuck around for like six months. So it was just-

Stephanie:

Okay. So was the headline, it made them think it was something that it wasn't where they came in-

Dan:

Yeah.

Stephanie:

Okay, got it. Yeah.

Dan:

That's what the developer said that we manipulate people and it was like, no, we just had a misalignment in regards to what we wrote. I wasn't trying to manipulate somebody, but either way, that's marketing.

Stephanie:

Yeah. I mean, to me, that's just always a good reminder that all of this is a long game and anything that's focused on like a quick hit and trying to pique someone's interesting and get them in, it's probably not going to work out long-term.

Dan:

And if anybody knows of Kissmetrics, that was the whole reason why the company went out of business and got sold to a private equity firm is there was too many people at the leadership level that were focused on quick hits and it's what put us out of business. You got to focus on, you've got to have a good mix of short-term and long-term focus and why we've been so successful and are still successful even at our company and our clients, we focus on the longterm as much as we do on the short term.

Stephanie:

Yep. Yeah. Very cool. So when thinking about marketing and all these data attributes that you can have on your customer, how do you think about a, sorry, a potential cookieless world?

Dan:

Oh, it doesn't bother me at all. Cookies, whether you like it or not, the cookie is not going to die. It's third-party cookies they're talking about which are going to die. It's not first party cookies. The problem that people don't understand is we've already come up with millions of solutions to create better first-party cookies, if I could talk, better first-party cookies, which we hide third-party cookies behind. So I mean, we just had a whole debate about this last week.

Dan:

Cname cloaking and proxies and all this stuff. There's already a ton of ways to kind of hide it and change it. The cookie's not dying. It's just the way that the cookie gets used is what they're saying is going to die. But cookieless world is going to happen. Is it necessarily going to be ... I almost want to say it's a false or that the cookie is going to die because you can't completely kill a cache in a user's browser about what we know about the user or you'll break the internet.

Dan:

And the internet is not prepared to completely get rid of all those technologies, so there's always going to be a hack around it. So we have a technology called utm.ao that we use for campaign tracking. So if anybody out there uses UTMs, they have a stupid UTM spreadsheet. We solve that problem. But the real problem is that the technology is now making it so that before you even before you even get to the website, we know who you are. So that's all going to be passed to the website through URL parameters, and there's all kinds of hokey stuff there. So I guess like I'm not that stressed, if that makes any sense.

Stephanie:

So why are other people so stressed? Because I listened to different ad tech podcasts and other marketing shows. And I mean, there's been so many conversations where people are stressing about it. So why are you so chill about it then and they are so worried?

Dan:

Yeah. Well one, if you're an ad tech company, Apple's out to cut your throat, right? Like there's just no way around it. Facebook is in a complete battle with Apple, which I think one, Apple is totally doing this for a promotional stunt because their job is to own your data, right? Like don't let them fool you, they know every single thing you do and they hold it on. It's the reason why they're one of the most valuable companies in the world is they know every single action you do. So for a Facebook, it's definitely really, really concerning because they have to be able to get companies like, and I'll just use one of our clients, King's Wine to figure out how to do Cname cloaking and proxy changes and stuff like that, which is really, really hard.

Dan:

But if you're using myself as like your consulting firm, like that's our job is to figure that stuff out and to solve those problems for you and to deal with it. So I guess like for me, I'm not stressed because that's what we do. But for the ad companies, like how the hell did they get everybody else to know how to do that, right? They've got to teach mission.org how to load a advertising pixel in this certain way and there's no way that mission.org is going to figure that out unless they hire me. So that would be the reason why there's the big difference is I actually know how it works. Most people have no idea how any of this stuff works.

Stephanie:

Yeah. Okay. Well that's good then. So then no one has to be worried and just hire someone who can help you, sounds like the gist of it.

Dan:

The general thesis of it. And it's expensive. It's a lot of service that stuff. So I mean, the problem is that 95% to 98% of the internet is not going to be able to understand it or fix it and that's where a lot of people are really panicking on how do we get this done? But there's always a hack.

Stephanie:

Yeah. And a certain point though, I wonder if Apple is going to have to change the way they do things. I mean, I know that they have been like ruling the market for a long time, but I see now that they're trying to get into something like podcasting and they have big competitors out there who already know how to do podcasts advertising, and they know how to show the dynamic ads and actually showcase metrics to the advertisers. There's so much competition when it comes to that. I can see Apple having to change the way they do things and provide more data and show the ROI instead of being like the black box of like yeah, just put it on here and it's in your best interest because we're a big platform.

Dan:

Yeah. Well, we have to remember that they did invent the pod cast and that came from the iPod. But they're allowed to, I mean, I think when you have that dominance, you're allowed to be slow to things. I mean, when we think back, I used to run a bunch of mobile app companies and like they sucked at giving us data about the mobile app. So we had to figure out all these other things. But when you're the gateway to the rest of it, right, when you're the heroine of the drugs, you can be a little late to solving your problems and that's unfortunately how Apple is. So they're going to be late to the party, but when they step on the throat of anybody else, they make changes. And I think the easiest way to think about it, does anybody remember the QR code? And it hasn't gone anywhere, but all the QR code apps, there's none of them, they're gone because it's part of your camera now. So when-

Stephanie:

It's funny how you forget about that. Like I remember being like, "Oh, which QR code app is the best one that I need?" And it's like, they're all the same, just pick one.

Dan:

And now none of them are around, just like the calculator apps. And like when Apple wants to ... And in our business, one of the things that we try to help our customers figure out and this is something I hope all of your podcast people listen, if you've never read the book, Crossing The Chasm, it's a really, really good read. But you have what's known as basically these innovators, which are out front. Most innovators die, right? They just don't live forever. And what we've recommended to our clients is be the early majority, right? Don't be the person always out trying to be a hipster because then you wind up finding out that like, hey, this stupid business idea blows up. I mean, I was put out of business one time by Facebook changing a feature like, oh my God, I can't believe Facebook changed a feature I went out of business.

Dan:

There's definitely things that other big companies, when you build on their platform, you have to be aware of that if they just decide to get into that space, you could go out of business or you could not have a feature which your business is around. So we always recommend people don't always try to be the innovator, wait for there to like be something solid, wait for something to be proven, wait for something to be figured out. Because if you're always going from the next hot flip to the next hot flip, and you're always a hipster, you're going to spend 10X more money than I am, and I'm going to still make the same amount of money if not more than you and that's always fascinating.

Stephanie:

Yeah. I also recommend that book and it's come up a few times on here. It's a really good one. I mean, how do you think about companies relying on a platform? Because I see so many brands right now just launching on Amazon, for example, and not even worrying about building out their own website presence or even developing their own community. Like how do you think about that?

Dan:

Well, I think my opinion would be different if they would have been doing that 15 years ago. Right. But if you've ever read the book, The Everything Store About Jeff Bezos, just understand he is coming for your throat too. I mean, they're just like Apple. If you read what they did to the book publishing industry, I'm like, "Holy crap. Wow, they completely gutted that industry." So for now I mean, there's not much you can do about it. You have to play with it. But I think it's definitely imperative that you create your own online presence. And I think this is where Shopify is trying to come fill a void is there is definitely, you have to do both at the same time because at any time Amazon is just going to come out with Amazon basic of your product and you're done. They've done it hundreds of times, if not thousands of times.

Dan:

So you do have to build your own kind of side sliver as a brand. And I think the best book that I think I've ever read, which made me understand not only my childhood and why I am the way I am as an adult is the book Antifragile.

Stephanie:

Yeah. You seem to love them.

Dan:

Yeah. It's such a great book. But you have to have optionality and if you put all of your cards on Amazon, well, you don't have any optionality. And I think creating those options is a huge business. I mean, I read 42 books last year. So we want to get into like talking about all the cool things I learned just last year on that stuff. But optionality is huge. I think it's really, really important.

Stephanie:

Yeah, we've had a great guest on from, let's see, it was Taylor Holiday from, I think something collective. I can't remember what his company was, but he said, "You need to figure out how you can basically win even when you're wrong." So like when your models are wrong, which to me I'm like, "Yeah, you're talking about being anti fragile and making sure that you won't fail, even if your models set you in the wrong direction, how can you still benefit and have upside?" Which I thought was really interesting to frame it that way.

Dan:

Yeah. And I think in regards to the platforms and I'll try to bring this back to like the marketing technology platforms, there's a lot of optionality that you can look at and you need to have a backup plan to your backup plan in regards to marketing technology tools. I mean, Marketo got bought by Adobe and that's going to revolutionize the way their product works. And I mean, there's a lot of things in Marketo that suck already and Adobe buying it just means that it's going to slow down, right?

Dan:

So you have to be prepared to be able to say, "What's my backup plan to Marketo? And if I was to switch, what is that going to take?" And that's one reason why we recommend a lot of companies to leverage customer data platforms because it makes switching easy, but then you run into the same problem. Well, if you have a customer data platform and all of my data goes to the CDP, well, what happens when that CDP gets acquired? Right. What happens when Twilio buys Segment for 3.2 billion? How does that change my ... what's going to happen to the CDP? So you just have to ask those questions, like what are my other options with these platforms when I choose it and how much am I baked into this tool? And if I lost this tool tomorrow, what would it take to replace it?

Stephanie:

Yeah, that's really good to have a mindset like that and be thinking about all angles. So really good. So from a general ecommerce standpoint, what kind of trends are you guys preparing for in 2021?

Dan:

Well, first one, just going back, the death of the cookie.

Stephanie:

Or apparently you're not preparing at all and you're like, "I'm good."

Dan:

No, I mean, we started ... I mean, if Google the death of cookies McGaw.io and we wrote a blog post about this a year ago. So we've been tracking this for a long time. I think that the biggest thing that we are focused on, the biggest thing that we see in ecommerce right now, everybody wants to do multi-touch attribution. Everybody's trying to figure out how do they do multi-touch attribution to better align their return on ad spend. Because the key problem that you have is all these retailers are spending millions of dollars a year on advertising spend. And then if they look in Facebook, they see a conversion in Google, they see a conversion in LinkedIn or whatever the platform they see a conversion and they're attributing one sale to five different conversions. So they're really trying to say, "We understand that those five conversions we see in these different platforms or from one purchase, and we need to be able to pull that data together." So touch attribution is huge.

Dan:

We're extremely well-known in that space so a lot of companies are working with us on that, but every company is a unique snowflake for multi-touch attribution. Recommendation engines are probably the other thing that we see a lot of companies really trying to figure out. There's a cool technology called blue shift. Really, really good for ecommerce especially if you have thousands of products. They use machine, excuse me, machine learning to consume your catalog. And then also use machine learning to distribute that catalog as a recommendation to people based upon the best channel that suits them at the best time for them. Blue shift is crushes it. Great technology, Josh, the CMO or CGO, chief growth officer is a good buddy of mine.

Dan:

So we see a lot of the trend in regards, how do we make proper recommendations on the right channel at the right time with the right message. And then the last thing would just be customer data platforms. So those are the big three trends. I mean, one of the reasons why we're crushing it right now is like we know CDPs better than almost anybody else, customer data platforms. And customer data platforms, it's not a fad, it's not a trend. It really is the future on how you need to manage your data and your customer data specifically. So those would be the three big things that I would lean on for 2021 and going, especially into 2022.

Stephanie:

Cool. So you were just mentioning channels. What kind of channels are you guys most bullish on right now? Maybe are there any new ones out there? We've had a lot of people mention TikTok. You and I were talking about Clubhouse earlier. Is there anything that you guys are kind of shifting your focus towards and trying out?

Dan:

Oh, I love TikTok. Man, they tried to hire me as a brand ambassador and I so wanted to do it, but we had to turn it down and I love TikTok. I spent so much time on there. It's ridiculous.

Stephanie:

I do too. It's great.

Dan:

I think TikTok is great, a really, really cheap channel, but you got to learn how to do it, but it's a harder curve so I think that's good. I think that there's a lot of ... YouTube, oh my God, YouTube, YouTube, YouTube, YouTube, YouTube. We haven't even hit how valuable YouTube is. I mean, they're going to be ridiculous. So I think between those two channels, figuring out video is going to be really, really important for companies across the channels with TikTok and YouTube. I think if you can't figure that out in the next five years, you're really going to struggle. There's a cool tool called Fleeq, F-L-E-E-Q.com, which will help you do that for video. So I think YouTube and TikTok are huge if you want to be successful. I think there are some other really surprising ones. Like I always try to tell people you should invest more in Bing. Bing's really cheap. I always think that's always really, really good.

Stephanie:

I haven't heard Bing yet. That's a new one. Okay.

Dan:

Yeah. It's just so cheap. Not as much volume, but just the per dollar comparison is good. And the last one that I'll just say is direct mail. Like, oh my gosh, it's so cheap.

Stephanie:

What are you guys doing in direct mail right now? Because that was also something I've brought up a couple of times of like so many people are now at home and I am delighted when I get mail that's not something spammy where I can actually look through a great catalog and like, oh, this is actually cool stuff. And I always mention the Trader Joe's pamphlet where I'm like, "They have really fun content that also sells their products as well." But it's, I mean, I look forward to that one. So how are you guys approaching the direct mail piece?

Dan:

Yeah, so depending upon what the integration ... I mean, there's a company called lob.com, which makes direct mail really, really easy. And we leverage autopilot as our automation tool and we've been able to, I mean, personalize tons of stuff. In regards to giving people recommendations, we are able to literally write text on the postcards saying the technologies they use through data enrichment. So there's a lot of stuff that you're able to do there, but we have to remember is like sending somebody a thank you card or a birthday card in the mail as direct mail like happy birthday. It's your birthday coming up soon. Right? Like that's not hard, but people love it. And with COVID, I think the best quote that I had somebody say to me into COVID, the most exciting part of my day is walking to the end of my driveway and collecting my mail. And I was like, "What?"

Dan:

So I think it's just a great medium to use. And if you build it as part of your automated personalization journey, I mean, once again, you don't have to know it's raining in somebody's area to send them direct mail. Right. But you can know that it's going to snow two weeks ahead of time or there's a good possibility, you could send them a coupon for snow boots. Right. Like I just, the options are endless. So yeah, I mean, I think it's great. Hey, you abandoned your cart and you left these three things on and you print like three things on there. I mean, the personalization is really, really crazy and awesome.

Stephanie:

Yeah. Yeah. Very cool. All right. So we have a quick lightning round brought to you by Salesforce commerce cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready?

Dan:

Can I admit I'm scared? Yeah.

Stephanie:

You can admit it. Yes. All right. I'll start with the easier ones first. So you sound like a little bookworm. What are the next three books on your list?

Dan:

Oh, next three books. I don't know. I'm not prepared for that one. I think Atomic Habits-

Stephanie:

I usually ask one, but I'm like, "That's too easy for you." You have to tell me three.

Dan:

Yeah. I'm slacking on my book thing because I had a goal at the end of the year to hit 20 books and I demolished it. So I could probably say my last three books, but Atomic Habits, Billionaire Plan and Maverick. Those are the three books that I want to finish right now.

Stephanie:

Cool. Where are you traveling to next when we can travel again more easily?

Dan:

Oh, well that's an easy one. I fly to Snowshoe West Virginia and less than four weeks to go snowboarding again and I'm super excited for that trip. I traveled multiple times during COVID so-

Stephanie:

Yeah. I mean, I have too, but some people haven't. So if you were to have a podcast, what would it be about and who would your first guest be?

Dan:

We are in the process of creating a podcast of what we call The Stack and we'll be talking to VPs of marketing and CEOs about their marketing technology, sales technology and customer success technology. My first interview is hopefully going to be with mission.org and figuring out how you guys manage your marketing tech stack.

Stephanie:

All right. Yeah. Bring us on. And we also have a whole marketing trends podcast where we interview CMOs. So then we'll have to bring you on that one as well.

Dan:

I think that'd be great. I think it would be a lot of fun. This has been awesome. You are amazing at this. Good, good work. I thought this was fun.

Stephanie:

Thanks. Yeah. I mean, we talked about in the beginning, what was our line was just don't be generic. So I think that was a good motto of our interview. All right. Two more questions. What's the nicest thing anyone's ever done for you?

Dan:

Nicest thing that anybody's ... My godfather took me for my first snowboarding lesson when I was like eight years old. It's the best memory I think of my entire life because it's something I've used forever.

Stephanie:

Oh, I like that. Alright. And then what one thing will have the biggest impact on ecommerce in the next few year? And it can't be the three things that you mentioned earlier.

Dan:

Oh, come on. The next biggest thing in ecommerce that's going to happen. Amazon will start to die. They're going to get ... I think Amazon is going to get split up because Jeff Bezos will want to do it. I think that's going to be one of the biggest things that happens in ecommerce in the next five to 10 years though. I don't know how long it's going to take, but I think that and Congress realizing that Amazon, they're too big.

Stephanie:

All right. Well, that's a good answer. I'm glad that I punted the other three so you had to think of a new one. All right, Dan. Well, this has been an awesome interview. Thank you for not being generic. Where can people find out more about you and McGaw.io?

Dan:

Yeah, so definitely you can go to McGaw.io, but I'm most active on LinkedIn, so go to LinkedIn and search up Dan McGaw. There's three of us, but you'll be able to find my pretty face. Go there and send me a connection request and play along. I've got over 25,000 followers there and I try to stay active.

Stephanie:

Amazing. All right. Thanks for joining us.

Dan:

Yeah, thanks so much. And the one thing I forgot, look up Build Cool Shit, my book which is all about how to build a marketing tech stack. If you go to McGaw.io, I'll send you a free copy. It's on the headline, but I forgot all about it. I have a book called Build Cool Shit. So I forgot that's-

Stephanie:

We will link it up. Don't you worry. Cool.

Dan:

Thank you very much.

The Future of Retail: A Conversation with Intel Exec, Joe Jensen

info@mission.org (Mission) — Thu, 4 Feb 2021 08:00:00 +0000

Convenience is king. Everyone wants the easiest experience possible, but, they also expect that experience to be seamless and delightful at the same time. When it comes to shopping, ecommerce has been able to bring all those elements together better than in-store retailers. But even though brick and mortar retailers are facing an uphill battle, Joe Jensen believes that they aren’t going anywhere, and there are still massive innovations to be seen to make a more cohesive experience.

Joe is a vice president in the Internet of Things Group and the general manager of the Retail, Banking, Hospitality and Education Group at Intel. He is helping brands across all industries and of all sizes become more nimble and data-centric. According to Joe, there are simple changes retailers can implement to solve big problems so long as you’re asking the right questions..

Like, what if you could solve all of your inventory issues with a simple technology that has already been in existence for years? And how can brands leverage in-store experiences as more of an enhancement to customers who typically enjoy online shopping but crave something more in-person?

On this episode of Up Next in Commerce, Joe answers those questions and more. Plus, he explains how and why traditional retailers should be utilizing more data just like their ecommerce competitors, and he gives a first look into the technologies that will be making an impact on the future of retail.

Main Takeaways:

Curation is the Cure: The role of retail is changing, and the retailers who lean into curated experiences will be able to better meet the new expectations of consumers. Rather than offering a little bit of everything, stores will want to give customers a deep dive into a specific brand experience, because that is what they crave when they are shopping offline.
Bring On The Data: When digitally-native businesses start to open brick-and-mortar locations, they insist on having as much data captured as possible about the customers who enter their stores. Traditional retailers don’t want or feel they need the data simply because they’ve never used it before. But the nimble retailers that use all the data at their disposal will be the ones to win even against their data-heavy, digitally-native competition.
Incoming Technology: From computer vision to full RFID implementation, technology is going to change the way shopping happens for both the customer and the business. But, don’t expect these changes too quickly. Despite the fact that using RFID technology would solve nearly all inventory issues, many brands are hesitant to implement that wholesale change. Why is that? And what will be the catalyst to finally change? Tune in to find out.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone and welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder at Mission.org. Today on the show we have Joe Jensen, vice president and general manager of Retail Banking, Hospitality and Education Business at Intel. Joe, how's it going?

Joe:

Oh, fantastic. Beautiful day here in Phoenix.

Stephanie:

Good. Yeah, I'm glad to hear it. That is a mouth full title, but I feel like you deserve it when you've been somewhere for 36 years, I saw?

Joe:

Isn't that scary. I didn't even think I'm 36 years old, so it's weird.

Stephanie:

That's amazing, actually. I want to just start there. Tell me how did your journey begin at Intel and what are you doing today? What's your day to day look like now versus 36 years ago?

Joe:

Well, I started as a product development engineer at Intel, and I worked in a bunch of different product disciplines as an engineer. My original life plan was really to leave Intel at about year 10 and go to a startup, but by year 10, Intel stock options were so attractive that I ended up being so that fully handcuffed into the company.

Stephanie:

Yeah. As with most tech companies, I was this close to staying at Google for the same reason. I'm like, "Oh, it's hard to leave. I see my options vesting in year three and five and seven," and you can just extrapolate it out and it'll keep you there. But it's good-

Joe:

I shifted from engineering to the business side in about year seven, and I've done a ton of different business startups in the company. I think one of the things I'm most proud of, I've started three businesses that were at zero and have hit over 500 million a year.

Stephanie:

Oh, wow. So what are the businesses that you've worked on?

Joe:

Two different ones in an embedded space, and then now the Retail Banking, Hospitality. Education is added into that, but that business started, gosh, it started at single digit millions and we grew it to, well, we're the largest business within the IoT space in Intel I can say.

Stephanie:

That's cool. So tell me a bit about when you're saying IoT, and then retail banking, now education, how do I imagine what you guys are doing for your partners? What are you providing them? What does that look like?

Joe:

In our space, the IoT space for Intel is really where IT for an enterprise meets the real world. So in the case of retail, it could be digital signs, point of sales systems, inventory management, building management, time clocks, any system that might be connecting into IT. If you go into the manufacturing side, which is in my space, the manufacturing units, it's where equipment data flows in off of manufacturing side flows into the enterprise.

Stephanie:

And how many opportunities are being missed right now by not implementing? I would say data analytics like you're talking about. When it comes to inventory I know that Walmart for a while was trying to figure out how to track out of stock issues and it was really hard even when they had the cameras going around the lanes because they couldn't see behind what was in front of it. I don't know if they figured it out yet, maybe you know better than me, but what opportunities are being missed by not having this implemented into retail stores?

Joe:

As an engineer, I really think about root cause and what's the underlying problem, and we really believe that inventory inaccuracy is one of the underlying problems in physical retail. The problem we have is if customer can't find it in the store, it's out of stock. It doesn't matter if it's in the backroom, doesn't matter if it's hidden behind some items on the shelf, it doesn't matter if it's misplaced. If the customer can't find it, it's out of stock. We have data and research that shows that 1% of customers who experience an out of stock will go through the whole journey of they search on the shelf for it, they go track down a staff person to go find it, they dig through the rack or they don't find it. They say, "Hey, hold on. Let me go check in the back." They go look in the back and then come out and then maybe they go to the POS and they look to see if another store has it, or they'll ship it to your house. 1% of the shoppers are that patient.

Stephanie:

That's me. I'm that 1%. I did that the other day at Pottery Barn. But then I was very upset at the end because I was like, just like what you said, let me look in the back. Not there. Let me look at our partner stores. Not there. Let me look online. Ooh, it's not the size you want. And at the end I'm like, "Ugh. Okay, goodbye. I never want to come back again." I love Pottery Barn, but.

Joe:

Talk about a study that showed that if a customer experiences that out of stock frustration five times in a store, they stopped going.

Stephanie:

Yeah, I can see that. So how do you go about solving something like that to get all your systems on top?

Joe:

It's really tough. I still think RFID is going to play a key role. Japan has a huge labor shortage problem. They just said because of the aging of their population, they don't have enough labor, and the government decided four or five years ago to put a big push on RFID, and they're mandating by 2025, all consumer goods that are sold in China have to come from the manufacturer RFID tagged. They've also funded a kind of research-

Stephanie:

And that essentially keeps everything inventoried, right? Then you don't have staff to work.

Joe:

Yes. What happens is you don't even need staff to check out now because consumers will put their items in a basket, step the basket on the checkouts, and it'll read all the tags and then we'll just pay and go.

Stephanie:

So it's like the Amazon Go store where they're experimenting with, but I don't know whatever actually happened to that. I went into one in Seattle maybe two years ago, but are they still around? What happened with the Amazon stores like that?

Joe:

They're still running. They do a tremendous amount of business. I don't know how much of it's because of convenience and how much of it is the novelty. I suspect that they're augmenting a lot of that with human capital behind the scenes. I do think that you're going to find retail bifurcating into two types of retail. You're going to see the hyper-convenient side, which is you just want to take all the friction out. How do I take all the hassle? How do I take all the friction out for the shopper? And I think for staples day to day things, you want to go pick up fast food, fast food should be fast. I won't throw the chain under the bus, but there's a new location near our house, and I swear there's a three-hour wait all day, every day.

Stephanie:

Oh my gosh.

Joe:

Fast food just isn't that good for me. I'm not going to wait in line for three hours to get my fast food. And so I think on the hyper-convenient side, that's a big part of retail. Then on the other side, we're calling hyper experience. With hyper experience, shopping is an enjoyment and a pastime for a lot of people. And during the pandemic, obviously you can't go to the mall. You can't go shopping like you used to, but that will come back, and that you want to go and get experiences. You don't want to go to department store A and then walk down the mall to the department store B. And if you close your eyes when you walked in, you wouldn't know which store you're in.

Joe:

Now, if they all have the same assortment, they all have the same brands, they all have the same brand micro stores inside their department store, what's the experience that you're delivering to the consumer? If you go try to find a piece of clothing and it's out of stock, how's that experience? That's not a very good experience. So yeah, it's funny. I had one of my engineers in China explaining how he really has everything delivered. All his groceries, all his food. China is just hyper convenient from that perspective. It's cool and I love it.

Stephanie:

But they're used to it. They grew up like that, though. I feel like here, if you try and introduce some of those conveniences, it'd be like everything should be done this way. I don't know. I think Americans are a little bit more like, "Oh, that's weird," because we just know we have to do like this.

Joe:

It's really cultural differences, but I love this quote from him. And he said, "If I'm going to bother to put pants on and leave my apartment, it'd better be worth it."

Stephanie:

That's pretty great, and true. I feel that.

Joe:

It's like if I need batteries, do I want to get in the car and drive and go buy batteries? Well, if I do that and go to the store and they don't have that special battery, then it's really disappointing because now I spent 20, 30 minutes going out of my house to go get something because I wanted it right now and then they don't have it. This is why consumers do it a few times, they just start ordering online.

Stephanie:

Yeah. And I think the product, like you said, has to be worth it. How are you guys thinking about the experiences piece? Because we've had quite a few guests come on the show who've talked about their retail locations and turning them more into an experiential place, where you go there and you've got the certain music, and the vibes, and maybe you've got a yoga class going on over here and you're going there, not just to maybe pick up your product that you did order online during this time period, but you're also going there to maybe experience something that you wouldn't get elsewhere.

Stephanie:

A lot of people are saying retail's dead and I definitely do not see that happening. I'm like there is pent up demand to go in person and to go into stores, but I do think now there's going to be a new level of expectations of the consumers, not just going to want to go and shop around, they're going to want something else. How do you do that?

Joe:

I think that the role for retail is changing in terms of what experience means. If you go back 30 years ago, 40 years ago, shoppers didn't know what the new fashions were until they went to their favorite store and they saw what the new fashions were. So you went to your favorite store whether you're a Neiman Marcus shopper or Macy's shopper or a Target shopper, you went to the store to see what's available, what's in now. And there was that discovery and learning and value proposition that that store was giving you by bringing you things that fit your demographic. Today people know what's current as the store learns what's current. It's what the celebrities are wearing between social media and how quick things are in internet time. There is really no discovery value proposition for mass merchandise things.

Joe:

Where we see real success is curation. So you go to a store that's not a little bit of everything. It's a store that dives deep into a lifestyle or deep into a fashion style or deep into a demographic, and you go there and you immerse yourself in that brand, and then you immerse yourself in what that brand is about. That's the discovery. If you're someone who likes West Elm, and the style that West Elm delivers, you go to West Elm to see things that would be hard to find on your own elsewhere. If you wanted to go find your own curation, it would take you months of time on the internet trying to go discover all that stuff. But you can go to a store where their buyers have pulled that look together for you.

Joe:

If you're a Pottery Barn shopper, same kind of thing. You go to Pottery Barn and they've curated a set of things that fit a certain demographic and the lifestyle that they're looking for. So I think you're going to see a lot more of that curation. We did tour in New York City a couple of years ago, and the stores that were really doing amazing well were really deep into that curation idea.

Stephanie:

Yeah. I love that. I completely agree. I'm thinking right now about going into a Crate and Barrel or something like that, and I'm looking to find new things of a similar style, instead of going somewhere that's exactly the same that I can just find online. That's a really interesting take. How are you viewing the omni-channel experience of making sure that's frictionless when someone's looking online and then going into the store and having a good experience online and offline?

Joe:

I think a few retailers are starting to really get it right. I think in the beginning, omni-channel was a poor band-aid for I'm out of stock in the store, and I think most customers didn't see that as a good solution. I think the right way to think of omni-channel is there used to be a really consistent funnel for how shoppers and the shopper journey went from just initial discovery all the way through purchase, and that funnel, I think, no longer exists. I think people find out about products all over the place. You might see it on a television show. You might hear about it from a friend, you might see it on social media, and your discovery happens in your life. Omni-channel really ought to enable you to easily find something you're interested in whenever you see it, or whenever you want to. There was an old Burger King commercial Have It Your Way, I think 30 years ago.

Stephanie:

I remember that.

Joe:

I think the omni-channel today really means that shoppers ought to be able to engage with a brand or engage with a product wherever and however they want to.

Stephanie:

And I like the idea too of picking up where you left off. Like if I'm shopping online and then I enter the store or get near it, a subtle reminder of, "Oh, hey. You were looking at this and it's actually here on aisle seven," or whatever it is, directing me to complete the consumer journey. But I don't feel like it's there yet. I know we've got beacons and ability to see when people are entering your store and track that, but it seems like not a lot of retailers have fully leaned into that method to make sure that the full experience is cohesive.

Joe:

Yeah. I think that we're coming from the early days of that. One of my favorite stories years ago, we were shopping for a Tiffany lamp years ago, a couple of years ago, Tiffany lamp. And I searched online one night, looked at some options. We went to a store and we bought a Tiffany lamp. And for the next two months, every banner ad I had on the internet was for Tiffany lamps.

Stephanie:

Yeah. It's like I'm past Tiffany now. I'm onto the next kind of lamp.

Joe:

I think that what's happened is there's been too much of trying to use algorithms and online searches and data to try to target individuals with things that you think they might be interested in and not enough focus on helping people build a cart of things that you are interested in. So, for example, imagine if you turn it around for a minute and the brand for an item that you're interested in has an ability for you to put something that you're interested in, in a basket. And then when you pass a store that carries that item, that has it in stock, they flag you that this thing you're interested is in this store, and it's almost turning it all the way around from the store or the brand pushing to having the brand help guide you to where you find things.

Stephanie:

Yeah, that's really good. That's the kind of world I would like to live in where it actually is helpful and not annoying. I was just speaking with another guest about text messages and how certain retail locations will be like, "Come on in for 20% off," and I'm like, it's not helpful when I'm sitting on my couch, watching The Bachelor. It's helpful when I'm walking into the store and they're like, "Hey, you better make sure you buy that rug from World Market because here's a coupon now. So make sure you finish the journey and you don't just walk in and out." But yeah-

Joe:

You're reaching to the point that's one of the things I think the retailers especially are missing, and I don't know what a good analogy is, but I think that discounts and sales and coupons are an overused tool and they influence a lot of people, but not everybody. I think that for some people being first is more important than getting it on sale. For other people something scarce and having access to it before it runs out. So I think there's a lot of opportunity, even just convenience. Take a grocery store, nearly every grocery store I've ever been in, they put all the staples in the back, and they run with 19th century's retail logic of, oh, if I make people walk all the way through the store, they might buy some more stuff.

Stephanie:

Not me, I got blinders on. I'm like I need my milk and goodbye.

Joe:

It turns out that the convenience stores like 7-Eleven sell a ton of milk. I don't know if you've ever bought a gallon of milk at 7-Eleven.

Stephanie:

I have, yeah. Hey, my two year old, desperate times desperate measures.

Joe:

And it's about convenience. So if I were in a grocery chain, in fact, I talked to one about this big chain recently and said, "Why don't you take your house brands of the staples and put them in a section in the front of the store where they're super convenient and mark them up, make them the same price or maybe even a little bit more than the branded stuff." And the answer was, "Well, we tried that and it didn't work." I'm like, "Oh, when did you do that?" "It was like 10 years ago." I'm like, "People have changed a lot in 10 years."

Stephanie:

Yeah. I'd rather pay more to get right to it. So what are some maybe interesting stories like that, where they have listened to your advice and they've seen good results? Or anything where you're like, "Oh, I remember this one customer did this and they increased revenue a bunch because of this one subtle tweak in the store layout or how they did their products or inventory," or whatever it may be.

Joe:

We'll start a little bit maybe with I think that pretty much in every case when we've helped a retailer test or try a technology, the results always exceed the indicators that they put forward. And the very be wilderness thing to us is that even though these solutions look to deliver tremendous results and impact, they still don't scale them.

Stephanie:

I don't think.

Joe:

Years ago we had a partner that was putting cameras in the ceiling to measure shopper engagement, how long does it take for a staff to engage a customer? And they happen to have as an artifact of that, I won't say the brand, but they had a brand of popular, very popular Cola was in the camera view on the shelf. And they observed that this diet version, this Cola was out of stock almost all the time. So they went to the head of all stores for this giant grocery chain and said, "Hey, I think that there's an opportunity for you to..." Actually it was, I'm sorry, the brand, they went to the brand and said, "You got a not at stock problem in this grocery chain." The guy they talked to said, "Oh, there's no way. I was head of merchandising in Southern California. We have people in that store twice a day checking inventory. Its inventory are stocked twice a week. We are never out of product."

Joe:

And I'm like, "Oh, really? Here's some video of how much you're out of stock." And it turned out that within a half a day that they stocked, they would sell out and they would be out of stock all day, for two days. The problem we run into is you put process in place and you tell people to follow the process and it may or may not happen. So they look at this and they're like, "Well, there's tremendous value in having this product in stock. It's a driver product for the store." If they're out of stock, and the store cares that they're out of stock. The cost of deploying the solution was probably $30 a month per store, not a huge thing for one of their top 70 driver products, and yet it never scaled.

Stephanie:

Interesting.

Joe:

And you feel this thing. There was another one where the labor, they showed this 30% increase in tool sales in a major chain by tracking the staff and shopper engagement and improving that. It was really simple solution. Almost never scales. Now one that we have seen scale, Theatro makes a Voice over IP ear piece set up for staff. So if you go to, I think, well Bass Pro Shops, as an example, who's the one that does jeans and apparel for teams? They all have an ear piece and a radio.

Stephanie:

Oh, Alister? Gap.

Joe:

Anyway, it doesn't matter. A lot of retailers use radios, and there's a cost in the radios, and for a parody, they can switch over to this Voice over IP, and this is one where we're seeing people test it, and then in a matter of weeks completely changed all their devices over. The value in that if you look at it, if you're on a radio network, everybody that has an ear piece in their ear hears all the chatter from everybody all day. With this new solution, you can address a message to an individual person. So only the person you want to talk to gets the message. Then there's the ability to ask for stock and deliveries and things like that. So they've also built the ability, some of their customers, if somebody drives up to do a pickup, you order online, pick up at the curb, you don't want there to be a high friction experience. You want to be able to pull up, very quickly have somebody bring your item and leave.

Stephanie:

So where do you think then the future of retail? What does it look like with all these new... Some of them feel like little tweaks, a radio where you just talk to who you want. To me, some of those things feel little. Are there not enough incentives for these retail stores to change? I know you had mentioned Wall Street maybe beating up on retailers a little bit when it comes to wanting to try new and innovative things. What do you think is holding back retail right now?

Joe:

I think a big part of it is Wall Street, again, back to that root cause problem. There's a set of retailers that we think of as digital media, and these are brands that started as a purely online brand, and now they're going to open up stores and they realize once they get to about a billion dollars or so in revenue to get to the next level, they've got to go physically open stores or expand their reach.

Stephanie:

Yeah, like Warby Parkers of the world.

Joe:

Yeah, exactly. And these digital native retailers, when they come into the physical world, they expect access to the same kind of insights that they've been getting with their online entity. They want to understand how many shoppers are coming in and when? What's the dwell? When people are picking things up and putting them down and not buying them, it's like something in your cart that you took back out. And they come in with a long list of insights that they'd like to be able to get in the retail operation. The question in Intel is how can you help me find people that can bring these solutions or help me deploy these solutions? And when I go to more traditional brick and mortar retail, the conversation is trying to convince them they should have these insights.

Joe:

So I think that a part of it is the digital natives come from a world of when you're online only, the only insights you have into your shopper is through the data trail they leave behind them. I think if you go to brick and mortar, they're not used to capitalizing and utilizing that data. Talked to one partner recently, they haven't validated this, but they said that the amount of data that Walmart generates in a day would take 26 years to upload to the cloud, being given traditional techniques.

Stephanie:

Wow.

Joe:

So there's a tremendous amount of data created in the enterprise of retail every day. And we think with IoT and the cost of compute coming down so much, and the ability to use AI to get insights, you can utilize a lot of this data at the edge without incurring the costs of moving it to the cloud and trying to process it there. I think that if you imagine that you're moving petabytes of data to the cloud, and you're trying to find the needles in the haystack, it's a really big haystack. How about if I just try to sift through the insights real time as they're occurring in the store?

Joe:

We talked to a major fast food chain who prides themselves on fresh product, and one of their major problems, I won't say what the product is, but they were throwing away 40% of their product to maintain the freshness, and they wanted to have a short wait because they understood freshness was important, and freshness was important for the brand, but they were having a huge product waste problem, and they wanted to use predictive analytics to understand what's happening in the parking lot? What's happening in the drive through and what's my queue look like in the store so they could predict when to put product in the cooker versus cooking it always, and then having it there just in case.

Stephanie:

Were you guys able to help with that?

Joe:

Absolutely. That kind of change drives tremendous business cost savings, but also ensures that your product is fresh and that your customers are satisfied in having to wait for product. So when done well, we think these insights deliver not only customer satisfaction, but also tremendous business impact.

Stephanie:

I mean, that also makes sense for why a lot of the more Legacy Retailers are scooping up all these DTC brands and keeping them separate and learning from them to see like, oh, what are you guys doing over there? And then starting to integrate them into the org to maybe be brought up to speed a bit with how maybe retail should operate from a digital perspective and what are the expectations coming in from someone who's used to that? And how can it get implemented into the org? We had someone on from Kellogg's who said just that. They would acquire different DTC brands, but then keep them off on their own so they didn't get too mixed into the Kellogg's culture because they wanted the DTC brands to stay as their own brand. So they didn't, I guess, turn too corporate if it happens. I don't know.

Joe:

Maybe not say corporate. I think you don't want to turn them old school.

Stephanie:

Yeah, exactly.

Joe:

[crosstalk] We see that same thing, and you mentioned the expectations. One of the ways we explained this consumer expectations, every time you have a better consumer experience on your mobile, better app experience, in the back of your mind, you wonder why every experience isn't that good. I'm old enough that I used to travel where you had to go to the ticket counter to get your boarding passes before you could print it at home, and then they went to kiosk where you could print them at the airport and it was an amazing improvement, and then they went to actually really pretty good apps. So airline apps, you can see if there's a meal on the plane, you can pick your seat. You can do quite a few things, check the status of the incoming flight, et cetera. Airline apps are really pretty good, and I travel a ton and I stay in hotels all the time. Why are the hotel apps worse than the airline apps? Why can't I pick my room?

Stephanie:

That's true. Why? I'm sure you probably asked them before.

Joe:

Well, and actually it's interesting. It turns out that the most hotel chains are using a third party service to assign and block rooms.

Stephanie:

Got it.

Joe:

So they don't actually have control over that, which is kind of crazy.

Joe:

And so I think what happens is anytime you have this better experience as a consumer, then it raises the bar on your expectations for every other experience. Cabs were, I've never enjoyed a cab ride. Not once in my life, I think.

Stephanie:

No, never.

Joe:

Uber realized early that there was a huge amount of friction in getting ride and people hated cabs. You'd call for a cab, all they would do is throw it on the radio network and maybe a cab responds, maybe not. You didn't have any predictability. When you get to your location, the last thing you want to do is sit there in the cab on the street corner and spend two or three minutes paying the cab driver.

Stephanie:

Yeah, awkward.

Joe:

And they understood that there was this huge friction. Well, now that Uber has taken the friction out of getting a ride, consumers see friction elsewhere in their life, and like why do I have this friction? Why is this not as good as an Uber?

Stephanie:

So what areas do you think are the biggest friction points when it comes to retail locations right now? And what do you wish things were looking like maybe over the next couple of years? What are you guys planning for? Where are you hoping the world will be in like three to five years?

Joe:

Well, we think that you're going to see a lot more delivery. I think that grocery delivery was very slowly ramping, pick up at the curb or delivery, and with the pandemic, a ton of people jumped in and tried it that probably wouldn't have tried it for a long time. So the adoption curve for that took a real steep spike up, and we don't think that that adoption is going to slow down. So I think that the grocery, and the grocery business is tough. They run really slim margins, and we talked to one major chain and they said, if you pick up at the curb, that they lose $5. And if they deliver, they lose 10 to 15. So the chains have to figure out how they're going to deal with that. There are a bunch of startups that are building essentially dark store technology. So instead of having a retail location with a giant parking lot and a big square footage and employees, they'll end up with a small industrial space with all the same inventory, but some robotics that will pull stuff off the shelf and pack totes.

Stephanie:

We actually just talked to a company called Wolseley who talked about how they see the future being... They're B2B also for plumbing and HVAC and things like that, but they're like, "I'm not so sure if retail for us anyways is the way to go anymore," instead of just having a small guide shop out front, and then just having a micro fulfillment center or a warehouse in the back, and then they get your stuff and give it to you on the curb. But why do you need to come in for their business anyways and shop around when a lot of times these contractors already know what they want. They don't need to walk around like they would at Home Depot.

Joe:

It's funny, I was at a home improvement store recently, and I'm waiting in customer service to make a return, and they're on the phone with a customer who very wisely placed an order for like 50 things, probably contractor, but he did an online pickup at the curb order. They were on hold with this guy and they're talking to each other saying, "We don't have the labor to have somebody spend an hour running around the store to pick all these stuff." What a smart contractor? Why not have the home improvement staff eat that labor versus him send somebody? And he said, "Hey, can you please call me once it's all picked?"

Stephanie:

That's smart. I mean, how can-

Joe:

And of course they had to say, "Sure." The manager's like, "Yeah, absolutely." So I think what's going to happen is these expectations are going to keep rising from consumers, and the retailers are going to have to figure out how to adapt.

Stephanie:

Yeah. It seems it's the pricing thing, though. Right now everyone is expecting a curbside delivery or something to be free because it's new and that's the expectation now, but I could see eventually being like, if you want someone to shop for you, just like you would with any of these grocery delivery shopping apps, you're going to have to pay a little bit to have them go and-

Joe:

But look at it this way. We talked, again, one of these companies building these systems and we talked to a big chain that's testing it. If you go to the normal financial model for a grocery store, big piece of real estate, prime location, huge parking lot, a lot of physical assets tied up. And if you go to a dark store, really cheap, industrial space real estate, so the real estate model's completely different, the staffing model's completely different, and the financials could be such that, and again, I don't know, but it actually might be cheaper to deliver groceries that way. Now, it's a new build add, it's a new approach, but again it's a huge change, but it doesn't necessarily have to mean higher prices for consumers. And I think what's going to happen is some will try to charge more and others will figure out how to go do it in a way that doesn't cost more.

Stephanie:

That's a good point. I like that. So how do you think about-

Joe:

It's competitiveness, right?

Stephanie:

Yeah. Hey, that's economics right there. Someone will figure it out and put the other one out of business possibly, or not. But how are you thinking about new technology right now? I know we were talking a bit about AI and how it's impacting retail and retail workers. What are your thoughts around that or other technologies that are maybe going to disrupt retail?

Joe:

Well, still really believe a lot in computer vision, and I think one of the things I'm really proud of for Intel is we've always been huge advocates and protectors of consumer privacy, personal privacy. So as a company, our core culture, our philosophy, our lobbying efforts are all around protecting privacy. Our point of view in using cameras in retail, and we've been helping people do this for many years, we only want to do it in a way that's totally anonymous. So it's not like I'm trying to detect Joe when Joe walks in the store. I want to look at the pattern of behavior that this shopper has anonymously, and what have people in the past that had that similar pattern of behavior been interested in, and how might I go send some staff over to do the right thing there. So take me, for example, if we go to the mall and I'm with my wife or daughters, I'm probably hanging out with him and I'm not really shopping. So I'm wandering in the store-

Stephanie:

You're that personally couch just chilling.

Joe:

Yeah, or I might be wandering around in the men's department, but I'm kind of killing time, but I'm probably open for somebody to come show me something, because I'm browsing and you could observe that, oh, this person is slowly walking around and looking at stuff. There's other times when I need another white dress shirt for a business trip, and I know exactly which door to park at, that's the shortest distance to the white dress shirts. And I'm walking in a direct line to a section. Computer vision and AI could detect that this shopper's not browsing, don't bother him. Don't send them a discount coupon or don't send him alert to some new item they might be interested in.

Stephanie:

Do you have retailers right now who are implementing that? Because that sounds awesome and a really good way to personalize to the shoppers coming in. Do you have anyone who's trying anything out yet?

Joe:

There've been lots of things to experiment and test, a lot of partners building solutions like that. I think the world of privacy right now is way too fragmented. Too many different points of view, too many different state perspectives on it. You've got some places where cameras are banned. You can't use a camera at all. And I think that the governments really need to get their act together and understand how is the data going to be used? How is the technologies? How can it be done in a way to protect privacy? In the implementations, we advocate no data ever leaves the edge, the system. The only thing that ever leaves the system it's account. This kind of shopper did this kind of pattern of behavior. Everything's fully anonymous. Back in the early days, we actually went and talked to governments across Europe where the privacy is even more simple, and every government entity we talked to was totally comfortable with the approach we were advocating.

Joe:

I think the computer vision that we think is really going to be profound, and it'll be used for mundane things like trying to understand out of stocks or inventory situation. Years ago, I won't say the name of the chain, but there was a study where they're comparing Amazon to a giant big-box retailer. They went to 25 locations of the big-box retailer and bought these 40 items and then they priced it out on Amazon. The headline for the story was Amazon was more expensive than the physical retail location, which was big news at the time because everybody thought Amazon is just winning on price. But the subtitle of the article, the second message was, but 25% of the items on average were out of stock at the brick and mortar retailer.

Joe:

We happened to be meeting with the executives in that company about a week after that, story came out and their heads were exploding because they thought they had a 5% out of stock problem. And it turns out that they did in terms of it was in the store, but it had a huge congestion of stuff in the back room that wasn't on the shelf yet. And as we dug into it further, we did a lot of work with them using computer vision and whatnot, this is years ago, and it turned out that one of the behaviors they had that they had to try to break is the people stocking the shelves would bring a box of say large size mint shampoo out and they needed to have the small and the large, but they didn't have the small, so they just filled the shelf up in the large.

Joe:

So when somebody came to look for the small, it's out of stock, and the shelf looked full because they would face it all out so that every front was full of product, but they didn't have all the products on the shelf. It was really because the people stocking the shelves were not following the process and they're being lazy, and that's where we thought to-

Stephanie:

Use robots then. Robots aren't lazy and they listen to whatever you tell them. So that must just be the way to fix things.

Joe:

Yeah, maybe. I guess as a tech company maybe that's a good thing for us, but I think that, again, if it's a staple, you just want it to be convenient, and convenient means the fastest, easiest way possible. To me it's like when I run out a catch-up, wouldn't it be amazing if it was just at my door automatically the moment I needed it? Well, we're not there yet, but at some point, somebody's going to figure out how to make my running out of ketchup something that won't happen.

Stephanie:

Yeah. I thought there were brands or companies working on that to track what's in your refrigerator and then reorder it if it's out. Maybe that never came to fruition and that was more just that [inaudible 00:36:00].

Joe:

They've been a lot. We actually had some partners who were doing that years ago as well. The challenge ran into it I think is how do you know what's in your fridge? Does the consumer scan all the barcodes? Do you have the discipline to scan a barcode when you run out. These problems certainly aren't easy to solve. We mentioned earlier out of stock, so I'm working at that problem. We worked with probably, I don't know, more than 20 big retailers on trying to see how RFID could help solve their inventory accuracy. Then we would always start with taking one of their stores and we would do a really deep physical inventory. We never found any retailer that had better than 65% of their skews correctly counted.

Stephanie:

Wow. That's sad.

Joe:

Then if you want to be able to compete with an online-only retailer who gives free shipping, you probably have to give free shipping, but wouldn't it be ideal if you could deliver all of your stuff from a local store so that you minimize the shipping time, you minimize the shipping cost. But if you don't know what your inventory is, then you take an order assuming you've got really close delivery, but then it's out of stock in the store. We talked to the department store who was really aggressively trying to do this fulfill from store, and they were spending on average 20 minutes per item to find it on the floor.

Stephanie:

Jeez, if they're taking 20 minutes-

Joe:

That's [crosstalk 00:37:26], right?

Stephanie:

Yeah, that's wild.

Joe:

So they were looking at RFID to try to be able to help with that as well. With RFID, you would know where things are in the store. This is another one too. We talked to, gosh, I'm try to really keep people anonymous here, a head of stores executive who came from a large brand who had a lot of stores, and they deployed RFID in all their products in the branded stores, and they've got their sales go up like 60%.

Stephanie:

So why wouldn't everyone do RFID? We're talking about Japan's doing it with all their stores now, brands who are implementing it, are taking off when it comes to sales. Why wouldn't people? What's the holdup? Why are more people-

Joe:

That's the big mystery? So if you can figure this out through your interview, please share.

Stephanie:

I will have to start asking around. I'm like it seems like a no brainer. Is it hard to get your manufacturers to do it?

Joe:

I think there's a lot of processes that get touched, is one of the problems. There's your supply chain, there's your distribution center, there's all the staff in the distribution center, there's process changes at the store. So there's a lot of pieces of this that end up getting touched. We talked to one retailer, big retailer, who they made the change on the POS. It was a touchscreen checkout for the staff. They had to do a training class to train people on this change, and it was a two hour training class for like 170,000 employees. And they said it was all extra time. You couldn't do it on the floor. So now you've got 340,000 extra hours of labor to make a simple change on a user interface.

Joe:

I think when it gets to doing these kinds of changes, what happens when there's a return? What happens when there's a return but the RFID tag is no longer in the item? So there's a lot of things that have to change. I think what's going to happen is we're going to see branded retail do this first because they control the supply chain, and you're going to see some really tremendous results. The example I gave you when they were head of brand and retail at one brand, and then went to another one, the challenge with the second one is they had a lot more suppliers, so they had to manage a lot of factories to supply their stores, even though they were all their own brand. It was still a supply chain challenge.

Stephanie:

Well, it seems like Whole Foods and Amazon are going to be the first ones that can do it. They've got the ability to, especially with Amazon's operations and processes, and they've got the Whole Foods brand going on. They control all their supply chain.

Joe:

And the Amazon could decide to spend a gigantic amount of cash modernizing Whole Foods infrastructure and Wall Street wouldn't blink an eye. Kroger could never do that because Wall Street wouldn't let them.

Stephanie:

That's sad, and also just shows how there's, I don't know. It makes you wonder about how a lot of companies right now aren't going the IPO route, and I get it. I get it hearing and seeing the incentives like that, or lack of incentives of wanting to... They talk about destroy your business to make an even better one and how some of the best companies had to do that, whether it be the Netflix of the worlds. But yeah, it seems like a lot is held back.

Joe:

What do you mean? Private equity, we're seeing more and more where private equity will come in and the leadership of the company will be in favor of a private equity takeover because it can pull themselves off the Wall Street treadmill for a bit to make these fundamental changes.

Stephanie:

But isn't it usually a bad sign when PE comes in? Don't most of those companies end up going bankrupt when this happens?

Joe:

I think there's a couple kinds of private equity. Look at Dell. Not a retail case, but Dell they needed to retool Dell and they needed to not be under the scrutiny of Wall Street for a while, and Dell has done amazing things through the use of private equity. I think if the company is fundamentally unsound, private equity might be vulture capital, where they come in and strip things down to the bones and get rid of it. But I think fundamentally sound business that needs to make changes that aren't really possible to Wall Street, I think this is going to be one of the areas where I think there's going to be a lot of money made where private equity is going to go look at some of these really good retailers that fundamentally have to change. And if wall street doesn't change the model P&L expectations, I think private equity will become a much bigger factor.

Stephanie:

That's a hot take. I like that. That's very interesting. So if there was some data right now that brands should be collecting at their retail locations, that's not really hard to implement, but they should be doing from the start, what comes to mind? Where you're like, "Right away, you should be collecting at least these five attributes on your customers as they come in and you don't need computer vision. You don't need beacons or RFID, but you should at least have this to be able to give a better experience to your consumer." Anything come to mind?

Joe:

I think that the thing that is most fundamental, and it's still shocking that all retailers don't do this, and that's just counting your traffic. Not counting it daily, but knowing what's happening with your traffic every minute.

Joe:

But I think understanding your traffic, that's the most important thing for an online business. What's my traffic? Dwell. How long was this shopper in the store? How long was this shopper on my site? What things did the shopper browse? What was their click path for my online? What was their path in the store? For me, if I were going to leave tech and move into retail, I would start with how does an online retailer excel? And how would I try to get all those same insights for brick and mortar? One of the things to me that... There's a tremendous amount of demand created real time in retail. So we saw one study that says 60% of purchases in stores in the US and Europe are for things people didn't know they were going to buy when they went to the store. So a huge amount of real-time demand. You see something, you like it, and you decide you want to buy it. Well, how disappointing is it when you see something you like and then it's out of stock in your size?

Stephanie:

That's worse sometimes.

Joe:

That goes from being a point of excitement. You got a little bit of excitement to buy something and then you're let down. What we would say is rather than having mannequins displaying items that the brand is paying you to show this week. We talked to retail after retailer after two or three days of something on the mannequin that sold out, but they're paid to run it for a week. So they're creating demand for something that's sold out because the contract of the brand said you need to show this item for a week. It's funny. If you talk to a giant apparel brand about this problem, honestly, one of the C-suite executive was like, "Oh my God, that's why stuff's always out of stock in the store." I'm like, "Yeah, you have some flexibility and freedom to the staff to put what they have too much of."

Joe:

We talked to one major department store chain that made that change a few years ago where they said, "Instead of getting paid to run things on the mannequins, we're going to have our staff every evening look at inventory and whatever they have too much of, put that on the mannequin for the next day." And it's amazing how much they were able to sell through inventory before they had the market down. We would advocate that at the front of the store where you've got posters and prints, maybe it's a department store and it's prom dress season, so you're showing prom dresses on the poster, that isn't really relevant to most of your shoppers. Most girls are not prom dress age. Most moms are not at the age of having daughters that are prom dress age. Most dads don't buy the prom dress.

Joe:

Put a more simple thing in it. Put a digital sign at the front of the store with a camera that will anonymously look at age and gender. And then if you're really sophisticated, you could say, "Okay, well now I'm going try in inventory system and I have too many of something." Phoenix it was a really dry winter. We have too many raincoats. I see a guy coming in and I've got too many men's raincoats. Throw a men's raincoat on the screen. And even the next step, we can estimate the size of the shopper. So I've got a really big guy coming in, but I'm out of extra large raincoats. Don't show them a raincoat. These subtle things, and it's not like every shopper is going to buy a raincoat, but suddenly putting something that's possibly more relevant on the screen than a prom dress is a great way to use that valuable real estate. That's the kind of thing that an online retailer will do. Like Zulily, they introduce thousands of new products every day.

Stephanie:

Zulily? Yeah.

Joe:

We met with them one day at one point, and they said in the morning, early in the morning, they have one landing page, and by 8:00 AM, they have 280 unique landing pages. Then they know what demographic, what bucket you fall in for them as a shopper. So when you go to their landing page at 10 in the morning, you're going to see something that's full of things likely to be relevant to you.

Stephanie:

We were talking with Lenovo way early on in the show and they were saying they have 85,000 different landing pages going on at any one point. I'm like, "Oh my gosh, how do you keep track of that?" But he's like, "Oh yeah, that's just how you test and know what people want." So it's just very interesting. But I think Zulily though, when they say how many landing pages they have, they are all about talking about being personalized and stuff, but I think a lot of times they just think having a new name isn't being personalized and they count that towards a new landing page. That does not count just saying, "Hi, Stephanie," or, "Hi, Joe."

Joe:

The way they were explaining to us is if you shop for baby clothes, you often are buying baby clothes, your landing page would have baby clothes on it. If you don't buy baby clothes, your landing page would not have baby clothes.

Stephanie:

Yeah. That's more personalized. I like that. Very cool.

Joe:

The key thing here is that this is a journey. I don't think anybody's going to go make all these changes overnight, but there's the ability to start using this information. I think one starting, know your shoppers. It's amazing how many retailers when we talk to them about what are your shopper's pain points? What are your shoppers not happy with? They don't have a good answer, which is really surprising. For me, when we're out trying to define solutions for the market, the first thing we look for is what's a business problem. And if I go into education, what is the problem that educators are having right now that they're worried about? We go into hospitality, what problem do they need help solving? I often tell people at Intel, we have 3,200 PhDs. If we understand your problem, we can figure out how to solve it. And it's amazing how many retailers don't spend time really understanding what friction or what pain points do their shoppers have.

Stephanie:

Yeah. I think they're going to have to now. I think now with everything that's happened and you had the acceleration of ecommerce, there will be, like you said, new expectations. And yeah, I think the theme is now there's also all these new technology to use and utilize, and maybe implement if it's allowed, but then putting that extra level of human curation on top of it when needed is going to be the way of the future. So use the tech, but also have it curated and have the human feel to it that people are going to miss over this next year, especially with how much we've been at home all by ourselves.

Joe:

And after people have really radically modified their behavior for a year. A few months it was one thing, but we're coming up on a year where people have had to change pretty fundamentally how they shop and live. How much of that's going to stick permanently? Like I said, I think grocery, and some of those things are going to way more people will be doing that post pandemic than did pre pandemic and they'll stick with it. What else is going to fundamentally change?

Stephanie:

Yeah, I agree. All right. Well, I know we're running up on time, so I want to shift over to the lightning round brought to you by our friends at Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Joe?

Joe:

I am ready.

Stephanie:

All right. What's the nicest thing anyone's ever done for you?

Joe:

Oh my gosh. Our twin daughters were born three months premature, and the amount of help and leaning in that we had as relatively young and new to Arizona couple was just staggering. Probably 80 families leaned in to help us, which is amazing,

Stephanie:

Man, I'm going to come to Arizona. That sounds like a nice spot to be. How old are your twins?

Joe:

They're 30 today. That was a long time ago.

Stephanie:

Nice. I also have twin boys, and I'm a twin.

Joe:

That's awesome.

Stephanie:

What's up next on your reading list?

Joe:

I'm really actually studying more around AI and frameworks and trying to get a bit smarter around the nerdy geek stuff. So I don't have any grade to casual reading. For me it's more about the tech.

Stephanie:

Hey, that's good. Well, I was just going to ask you what one thing do you not understand today that you wish you did? Is it AI, or are there other things that you wish you understood?

Joe:

I grew up as a silicon engineer and so I'm a hardware person and I'm not a software developer, I never have been. And so I'm really trying to understand the worldview of a software developer more than a hardware person. At least I think I know I don't know everything. So it's almost like the first step of the 12 step program, acknowledging that I don't know everything, I'm there.

Stephanie:

Well then maybe you want to check out the book I'm just starting to read. I think it's called Ask your Developer by the Twilio CEO. I just started reading it.

Joe:

That sounds good.

Stephanie:

Yeah, there you go. If you were to have a podcast, what would it be about? And who would your first guest be?

Joe:

My podcast would be on how technology is going to fundamentally transform shoppers' lives.

Stephanie:

I love that. Who would your first guest be?

Joe:

And my first guest, I would actually like to have Bezos.

Stephanie:

As do I. Let's go get him. Jeff, where are you at?

Joe:

See if he can help you with that.

Stephanie:

Yeah, I know. Is Moore's law dead?

Joe:

Moore's law, if you think about it purely as Silicon, which is when Gordon created that, it was really a silicon construct. We're no longer on that same track, but at a system level in terms of what a system does for you, we're on a similar curve. One of my favorite ways to explain this is, if you hold up your smartphone, the amount of compute in your smartphone 10 years ago was 100X the volume and the same thing's going to be true. So if you look at this amount of compute today is going to be one-100th the size in 10 years. Or you could say, "Hey, what would 100X?" It'd be a giant server room could be in your phone. And so if you think about it, it's not a matter of if I have enough compute to do something, it's a matter of when I have enough compute to do something.

Stephanie:

Got it.

Joe:

And I think that's probably to me the magic of Moore's law and some people really get it, and they really understand that it's just a matter of a few years until the compute is cheap enough to do what you want. We're talking about AI for a minute, if we go back 10 years ago at Intel, we had $100,000 computer workstation on every one of our factory tools and these are $50 million tools. Workstation and a huge number of engineers creating algorithms to optimize our manufacturing. So we were doing AI that was very expensive 10 years ago. Very few manufacturing processes can afford that. You jump forward to today and it's simple and cheap and easy to have that amount of compute, and the maturity of this AI computer environment is so much improved that anybody can really deploy what took an army of engineers and very expensive compute 10 years ago.

Stephanie:

Oh, I love that. I forget what show podcast I was listening to where they were talking about AI and saying a lot of the stuff that we have today, we had access to 10 years ago. We just didn't have the compute power and the ability to do it, but people knew it was coming. And I'd always be interested to hear from those people who could see the vision and be like, "I just need another five or 10 years of acceleration and then my product will work." It's very interesting.

Joe:

If you imagine the amount of compute that you can afford, whatever that number is, $1000, $100, whatever, but the amount of compute you can afford is going to double in performance every 18 months. Okay, double, you can imagine that, but you don't realize it's 10X in five years and 10X is really hard to comprehend.

Stephanie:

Yeah, it's hard to extrapolate things like that. Well, I appreciate you answering that question. I was like, "Hmm, I know Joe will have a good answer for this one, even though it's very maybe off of ecommerce." But Joe, thank you so much for coming on the show. Where can people find out more about you and your work?

Joe:

Well, I work for Intel, obviously. We do have a retail landing page at Intel. We actually don't sell anything to retailers. All of our work is done enabling suppliers to retail to build better solutions, and I try to spend all my time, if possible, talking to retailers to better understand the business problems they have so I can help guide my partners in building better solutions.

Stephanie:

Cool. Sounds good. Well, people will go and find you if they have any questions I'm sure then. Thanks so much.

Joe:

Thanks, Stephanie.

How Platforms Like Clubhouse and On-Demand CMOs are Democratizing Access to Entrepreneurs

info@mission.org (Mission) — Tue, 2 Feb 2021 08:00:00 +0000

It doesn’t matter how great your product is if no one knows it exists. That’s why marketing matters. But not every company has the resources to go all out on a big-name CMO or to commit a large yearly budget to specific marketing efforts — especially when the digital world is changing so quickly. So what’s an ecommerce brand to do in order to get its message across to the right people?

Erik Huberman founded Hawke Media to answer that question, and for more than seven years he and his team have been making marketing more accessible to businesses of all shapes, sizes and stages. On the episode of Up Next in Commerce, Erik explains how companies should be planning their marketing budgets and what the revenue threshold is that companies need to aim for before they can even think about scaling. Plus, he digs into his entrepreneurial and investor roots to give some advice to those out there who are just getting started, including the hard truth about what it means to be an entrepreneur, and some tips on new and emerging platforms where you can grow your personal and professional brands. (And yes, we are talking about Clubhouse!)

Main Takeaways:

Same Problems, Different Speeds: Even the biggest brands in the world face the same key struggles as the new start-up making waves: access to talent. The difference is the speed at which the companies at both ends of the spectrum can move. With more decision-makers involved and more stakeholders to answer to, bigger companies have to be more methodical and intentional about who they bring in to help, whereas smaller companies can make decisions fast, but there is more volatility with every choice.
Join The Club: New platforms like Clubhouse are on the rise, and finding a way to capitalize on them is the biggest challenge currently facing businesses competing for market share. Listen in to hear Erik and Stephanie dive into the Clubhouse wormhole and the opportunities that await.
I Get So Emotional: Marketing is about eliciting emotion from the person you’re selling to, whether it is B2B or B2C. By establishing an emotional connection and presenting a value proposition that a buyer can clearly see as a solution to a problem, a level of trust is created that will lead to a long-lasting relationship.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey, everyone. Welcome back to Up Next In Commerce. This is your host, Stephanie Postles, Co-Founder at Mission.org. Today, on the show, we have Erik Huberman, the Founder and CEO at Hawke Media. Erik, welcome to the show.

Erik:

Thanks for having me.

Stephanie:

I am excited to have you on. I was just chatting up a bit before telling you how we are actually a client of Hawke Media, full disclosure to anyone listening. It's been amazing. But I would love it if you could go through what is Hawke Media for anyone who doesn't know?

Erik:

Yeah, sure. We're an outsourced CMO and marketing team to companies. So, what that means is we basically go into companies, identify what the holes are in their marketing, organization, or strategy. And then we can spin up different experts on an ala carte month-to-month basis, whether it's a Facebook marketer, an email marketer, a fractional CMO, et cetera. We've got about almost 200 full time people. We manage marketing for about 500 different companies from small startups to Fortune 100.

Erik:

Our mission, for lack of a better word, is to create accessibility to great marketing. So, the idea is we really saw that it was really hard to, for most companies, get access to great marketers. We wanted to make a place where we had amazing marketers, amazing talent, people that were top of their game, but it was super easy to work with them. That was a challenge we saw on the market that didn't exist, a solution didn't exist. That's how we got started.

Stephanie:

That's awesome. Yeah, it's been really fun. We did the CMO thing first. It was cool, because you do get access to people who have been CMOs at big companies before and they have all this expertise. But we had them for three months. And then they transitioned us on to the next stage of implementation of social and other things. It was just really fun to be able to have access to talent like that without actually having to hire them as an FTE or something.

Erik:

Yeah, that's exactly the model. I came from building and selling a couple ecommerce companies and just wish this existed. My last ecommerce company, we were heavily funded. So, I had a 10-person marketing team of talented people, but they all worked or they could have all worked half time or less and gotten what I needed to be done. So, we had toyed with the idea of, "Could we hire these guys out to other companies? Because they're a great team, but we don't need them all full time. But we need all their expertise." So, that's part of where it came from, the idea was born.

Stephanie:

Okay, cool. What ecommerce companies did you have before this?

Erik:

I had a company called Fame Wizard first, which was online music business coaching for musicians. Then a company called Swag of the Month. It was a T-shirt subscription company, long before Dollar Shave and all that. And then an activewear brand called Ellie that's still around, the E-L-L-I-E.

Stephanie:

That's awesome. So, what things did you learn at those companies that maybe you brought either to Hawke Media or to how you're maybe advising brands today?

Erik:

Yeah, really quick bullet points. Fame Wizard have a customer that has money. Having independent artists as your customer is really hard to build a business off of. Swag of the Month, the need for working capital and financing, which funny enough, we just launched our financing and working capital arm of Hawke Media a couple months ago. And then the third one, Ellie, don't overcomplicate it. If it's working, double down on it. Also, that I don't like having other people make decisions for me, because that's when I was working with a committee and I was not the main decision maker. They screwed up a lot.

Stephanie:

I like that you have bullet points. You're like, "I already got it covered. I already know."

Erik:

Yeah. I've definitely walked away with very specific, "Don't do that again."

Stephanie:

Yup. Yeah, that's great. So, are you able to share some brands that you work with? So, we can get the scope of who-

Erik:

Yeah.

Stephanie:

... that you guys are learning from and working with right now and teaching.

Erik:

Yeah, I mean, it's the full scale in terms of small startups, most people haven't heard of, and hopefully, we change that. Tamara Mellon, we started with it when they were a tiny business and skyrocketed them for a couple years. GREATS, the sneaker company, we built for three years with them and they sold to private equity. Incase, the phone case, until they sold to Incipio. It's ironic. We get a lot of companies to scale and then we get fired, but it's par for the course.

Erik:

And then we also work with big brands, Nike, Unilever, Estee Lauder, Red Bull, et cetera, as well. And then a lot of small brands that don't necessarily want to be the next big VC-backed company that are $3-, $4-, $5-, $10-million companies while we're working with them. That's what they want to be. They slowly grow and run a lifestyle business that pays them a couple million bucks a year and do great.

Stephanie:

Yup. Do you see the big brands having the same type of struggles as the smaller ones, or is it very separate where you have to put very different skill sets depending on the company size?

Erik:

No, the expertise are similar and the struggle is similar in the sense of access to talent is really one of the biggest... True knowledgeable, experienced talent is what everyone's struggling with. The way we have to operate is different, because when you're dealing with a small business, a lot of times you're dealing with the owner, CEO. They can do whatever they want. There's no one they're reporting to, even if they have investors who usually have control. When you're dealing with bigger companies, you're dealing with publicly traded companies, a lot more processes, a lot more checkboxes, a lot longer time to make decisions. So, it's a lot slower. So, that's why I look at our client base like a distributed portfolio.

Erik:

The startups are super fun, because you can do whatever you want, you can get going quickly, et cetera. But they're also super volatile on the other end, where they'll fire you overnight for one small thing. Whereas big companies, they take forever to sign, take forever to make changes, but they also stick with you forever. So, we've worked with a lot of these bigger companies for years and years and years, because they're used to signing three-, four-, five-year contracts, even if we are month to month.

Stephanie:

That's good. So, what are some challenges you're hearing right now around either marketing challenges or business challenges that you guys are tackling that's maybe different than what you were hearing in 2020 or 2019?

Erik:

Yeah, I mean, 2020 was all COVID, but the silver lining was the market share of spending online almost over doubled. So, our clients on average doubled their revenue on what we were operating for them. So, that was really good. What we saw what changed towards the later end of the year and now into this year, so, now that market share hasn't diminished that much. Instead of 13% of consumer spending, being online pre-COVID, it went up to 30. Now, I think it's at 27%. So, it's still massive increase.

Erik:

So, we are seeing that now, all the big CPG companies and all these bigger companies that back to the point can't make quick decisions, unless the world's falling apart, cut everything. They usually do that and then they slowly roll back. They're all really coming back strong into digital, because they're seeing so much more market share there. So, what happened was the cost to advertise on Facebook and Google during Q2 and part of Q3 dropped about 30%, because there was less competition on it. Q4, October and November were insane, October because of the election and then November, holidays hit. December, they carry over a little bit, but they do lessen.

Erik:

And then I think now, I am anticipating advertising continuing to get more costly, because now, again, 13% of these big companies marketing online is now 27, they're going to spend more to capture that market, which means you're going to compete with them. So, if you're a small or medium business competing, there's a good chance that cost to advertise online increases significantly. So, not necessary what companies are looking for but what they should be is ways to increase their ownership of their customers, because if it costs you more to get a customer, the way to combat that is to increase your lifetime value to a customer. It's a math equation. It's that simple.

Erik:

So, how do you do that? You find ways to increase your lifetime through merchandising, through retention, through customer experience. When I say merchandising, having other products and services you can sell to the same customer. There's just a lot of things you can do, and then just continuing the communication like email marketing, SMS, chatbots, ongoing content, just all the ways you can create a walled garden around your existing customer base for them to buy more from you. The companies are going to win, which is why you see Amazon just skyrocketing. They were a book company at one point. Now, they sell you anything.

Stephanie:

Yeah, I love The Everything Store talking about how he and his wife are going and dropping off books to try and ship them out. That was a good book for anyone who hasn't read it yet. So, I mean, I'm thinking about myself as a smaller company right now. We're talking about ad costs are going up. It's going to be harder to compete against bigger brands. If you haven't acquired those customers yet and you don't have anyone to talk to, it seems like there's definitely an opportunity to be more strategic of finding new channels, whether it's the TikToks of the world or the Clubhouse.

Stephanie:

Shout out to Hillary, you just got me onto Clubhouse. But it feels like there's a bunch of new channels popping up that could help democratize community building a bit more or yeah, finding your audience in different channels that bigger brands maybe won't hop on as quickly.

Erik:

That's funny. I just got accused of being addicted to Clubhouse. So, my wife has actually had to say, "When we're eating, put that thing away." It's just the past week, but that platform is taking off. Yeah, it's always about working for diversifying. The problem is Facebook and Google still perform so much better than these other platforms that they need to catch up. TikTok will absolutely compete as they build out their ad platform.

Erik:

I think it's a no brainer in the way that the platform's built, but they need to do a better job of their targeting and everything, which when I say that, no one's spamming. It's just too early. Snapchat seems to be getting their legs under on Twitter. Hopefully, we'll figure it out.

Stephanie:

Yup, yup. I agree. Are there any new places that maybe are lesser known, where you're like, "We're trying out this one little thing in the back alley here that no one else knows about"?

Erik:

I mean, your know about Clubhouse. Clubhouse doesn't plan on monetizing through advertising, but as a community builder, it's crazy. I've been on it one week. I've 11,000 followers. I'm not an influencer. Twitter, I have a bunch of followers, but that's unusual for me.

Stephanie:

What are you doing on Clubhouse then? Because I get on there, and I'm like, "Hi." For anyone who can't see this, my awkward waving in Zoom. I don't know what I'm doing on there.

Erik:

Yeah, I've been fortunate enough to spend the past decade building a pretty solid network. So, when I got on there, a bunch of my friends were the people on stage that people want to hear from. So, guys like Daymond John and Lewis Howes and [inaudible] were all pulling me up to talk with them. And then other guys, like Grant Cardone, who I never knew before this now, start pulling me around with them. So, it's been a week, but all of a sudden, I've connected with a bunch of these heavy hitters that I've never knew before, that now we're also jumping on calls offline and connecting. So, for me, basically, I was on two flights a week almost in 2019. So, I spent most of my time traveling to shows and conferences and meeting people. This is scratching that itch.

Erik:

So, for the people that really want to network and build that network and learn from other people, this is the perfect platform for someone like me. It's not for everyone. So, I've gotten on stage. I've talked a lot. I mean, there's millions of people on it. Thankfully, I've been very lucky to build what I've built. A lot of them are looking for advice on how to build their businesses. So, now at this point, this is my fifth business I built. We've bootstrapped it. I've invested in, I think, 30 other companies. I've had a few exits, had some successes there. So, a lot of times, I can give some quick guidance to someone on there. So, I've done a lot of that, which has been fun.

Stephanie:

Yeah. So, since no one else has talked about this, this is why I'm diving even deeper into this. So, someone that can listen and be like, "Okay, I'm going to try that out too," are you speaking on there when you're saying you're on stage? Are you getting invited from someone? Are you just creating a room yourself? Tell me a bit about how that's working.

Erik:

Yeah. So, I mean, just to recap the platform, basically, it's super simple. All you see is a person's headshot, their little icon. It's all voice. So, you just talk. So, there's the stage and then there's the audience. Whoever's on stage can talk and you can mute your mic and talk. You got as many people on stage as you want, like a panel, and then anyone can come in and listen. So, as mentioned before we started this, I like to talk. So, me sitting in a room and talking and I've been in rooms with 20 people on stage, 30 people on stage, where I chime in once every 30 minutes.

Erik:

A lot of the habits that are starting to come on there are just people rotating on the stage asking questions of the panelists and just doing Q&A for hours, but it's people asking about, "How do I build my business? I'm struggling with this. What do I do here?" And then what I've seen is a lot of altruism, which has been fun. I've opened up my direct messages on Instagram through that. So, it's like, "If anyone needs help, just hit me up." So, making connections to VCs, to funding, to whoever could be a good distributor or a partner, give them advice, trying to help people.

Erik:

What I've seen also is a lot of people that aren't in L.A., New York, Austin, or Silicon Valley, that don't have access to these networks are all of a sudden... There was a whole world of amazing entrepreneurs I didn't even know until I got on this thing. It's a lot of the BIPOC community is getting on there and really helping each other. Not that I am one of them, I tried to help and very passionate about diversity and inclusion. So, we do a lot of charity work around bridging the opportunity gap. So, I've seen this as an amazing tool for that, because there's so many people that don't have access to... I've grown up around entrepreneurs. My dad's successful frankly. I grew up around people that have started businesses. I had a pretty easy path of role models.

Erik:

Most of these people don't or a lot of these people don't and that are coming from inner cities, et cetera. They are now on this. I do get pinged maybe 100 times a day actually on that thing, asking to be their mentor. I'm like, "You don't have to make anything official here. What can I help with? Let me answer your questions," that kind of stuff. So, that's been super rewarding, but I do see this as we're all stuck at home right now, where you are means nothing.

Erik:

So, this is a way for everyone to be connecting. But without having to be on video, it also makes a lot more people comfortable having a conversation. With voice, people are not as rude, demeaning. Social media has a problem on the tech side. We all know it, where it's like when you can just text whatever you want... We deal with it all the time with clients. If we have an angry client and we're on email, we'll get hate mail. Then I pick up the phone and call them and they're like, "Hey, how are you?" It's like, "What?" Same thing, I really think there's something there.

Erik:

The curiosity I have is as a social media platform... I'm sorry, this is all going to Clubhouse. But just as a social media platform, on Facebook, you might spend 3 minutes, 5 minutes, 10 minutes at a time scrolling through Facebook. Clubhouse, I'm watching people spend 12 straight hours in a day. I've never seen a social platform that people just zoom in and go. So, I'm really curious what that turns into. I think they'll end up monetizing by adding tips to panels, so you can actually tip the panelists or paid speakers, I think that's what we're going to see. Because they said they want to make money for their content creators, and they don't plan on adding ads.

Erik:

So, I think that's going to be interesting. But for brands to answer your question, I think for personal brands, it's massive. You're a CEO or whoever you are, building your brand on there and starting to talk. I mean, we had a channel the other day, where it was a bunch of beauty entrepreneurs from the south, bunch of women that had built beauty brands bringing up young beauty brands to talk to them. There were women coming on stage to talk about their brand and then going, "I've made $300 in the past two months on my website. The audience just bought $7,000 worth of items."

Stephanie:

Wow.

Erik:

That's happening. It's an eight-month old platform, but really got popularity two weeks ago. So, it's interesting to see where that can go.

Stephanie:

Yeah, I mean, that makes sense, especially around the theme too of, I mean, bigger brands too leaning into becoming their own media companies and getting on there and leading not just from their brand perspective but being thought leaders. Their brand is behind the scenes. If you offer value, someone won't mind if it's coming from someone at a large company that's like, "Well, sounds so smart. So, I'm sure they work at whatever big company that is," but they're the one on there offering the best tips.

Erik:

Yup. That's the other thing is there's no BS-ing it. When you talk enough, people are going to know whether you know what you're talking about or not. I've seen it. The rest of the two people on the stage are like, "Wait, what?" People call each other out, because I think people feel responsible, including myself. The audience is taking this advice. I jumped into a panel yesterday that was talking about Bitcoin. Some guys said, "There's absolutely no risk in investing in Bitcoin. You just put as much money as you can." I was like, "Hold on for a fucking second. Excuse me." Yeah, so there's that too.

Erik:

And then I do think there's a whole community and personal aspects that were like 21 Savage is one of the biggest followed people on. He does DJ sets every night with Sir Mix-a-Lot and all sorts of other people. It's not just business. There is a lot of other fun conversations. Overheard LA did a whole thing where they were saying, "What's the weirdest story you've had in COVID around dating?" There's comedy shows. There's all sorts of fun stuff.

Stephanie:

Yeah, that's awesome. So, when you're on there giving tips to businesses and people who are trying to learn, what are the top questions that you're asked or what things do you talk about that resonate most with business owners?

Erik:

So everybody wants funding. These are all early, early businesses. Everybody goes, "How do I get funding? How do I get a grant or a loan or funding?" If you need money to get started, that's a bad sign. Don't get me wrong. There's high tech companies and certain companies that you can't get around it. But most of the initial funding for businesses comes from friends and family if you need it. If you need a heavy amount of funding and it's not something high tech, you have to be real if you're the right person to start that business. That's one. There's a lot of people that pitch for that while starting with the hardships story, something that's like, "This is what I'm struggling with." I've noticed that it doesn't get the reaction you'd hoped for.

Erik:

Compassion is a big thing. I think for help, people do, but if you lead with that to try to get someone to be part of you in business, it shows the wrong focus. It's not to diminish what people are going through. A lot of people have had a really hard time recently and in general, but I do notice that when you lead with that versus excitement and optimism, you're going to attract a lot more people with optimism.

Stephanie:

That's a good one. Yeah, I've definitely seen a lot of people who come with the story where you're like, "I should feel bad, but also as a businessperson who maybe is either going to invest or partner with you, we'd be in this together. I need to know that you have another reason to want to push this forward. It's not just this." So, that's a good point. All right, give me more.

Erik:

The COVID excuse, I'm not very nice about this one, but I have too many friends that have done well in spite of COVID. Not because they got lucky. Someone came on the other night as like, "I've launched my ecommerce company last a year ago, but because of COVID, we've had a really hard time." It was like, "Take a beat. Because of COVID, your ecommerce company has had a tough time." We just went over the stats of ecommerce. I was like, "Explain that." It wasn't ecommerce. It was the person couldn't get out of their way. So, that's generally the advice I end up giving to, because again, there's a lot of people trying to get started. It's just go.

Erik:

My biggest learning in entrepreneurship in general is no one's that smart. It's just people that went for it and got lucky. I really believe that, including myself. I don't think that I'm not impressive. I think I went for it. I timed it right, meaning I got lucky. Meaning, because of the way the world worked, I knew about ecommerce right when the world wanted to build all the ecommerce and I was one of the only free agents in LA with a reputation of being successful. So, that's a big one.

Erik:

So, with COVID, I have a friend that owns 20 gyms across Canada that got shut down overnight, done. He's been doing it for 20 years. He three days later decided to launch a virtual training platform and has done millions in revenue in 2020 as a gym owner and was able to keep his entire staff, pivot, not lose money, and now have a whole new revenue stream that when things do reopen, he's got both.

Erik:

So, I have a friend that owns a chain of restaurants in L.A. He's not thriving, but his businesses are all still open. He's making money. He's made a living. There's ways to operate that you can actually get through this. I watch some of our clients, ecommerce brands. They're like, "Cut everything." I'm like, "What do you mean cut everything? The numbers are good. I get that the news is scary, but you're doing well. Do not cut." The companies that cut, I don't know if any of them recovered, the companies that I know that cut with us. And then we had a whole bunch of other companies that stuck with us, our average client in Q2 doubled their revenue.

Erik:

So, interesting if you think about what happened in Q2 of 2020. So, yeah, getting back to it, the biggest one is like don't give yourself excuses, go for it. That's a lot of what we're talking about. And then we get into sometimes deeper marketing conversations like, "What do I do to get started in marketing? If I don't have a budget yet, where should I spend my money? Should I run Facebook ads right away?", those kind of questions.

Stephanie:

Yeah, I love that. It reminds me too of doing things in haste, there's a good quote. That was around investing, but it's like the person who's scrambling to themselves when the news sounds bad or something, they're never the ones who do well or find a good ROI. I thought I'd be the person sitting and waiting most times and play the long game, instead of reacting to the news or quickly stopping or starting something really quickly. It's probably never that necessary to jump on something.

Erik:

Correct. You have to give yourself that luxury, so to speak. So, what I learned myself out of this was I'm keeping more money in the bank going forward, so that I can take a beat. Even if I see my business losing money, I can go, "Deep breath. What's the right long term plan here?" Not just react because I got to stay in business tomorrow. That's where a lot of businesses got stuck is we're in such a great economy. People are just spending all their money on growth. All of a sudden, it cut off. So, you have no money in the bank, that can be a bad situation.

Stephanie:

Yeah, I agree. So, you're talking about many of them don't have budgets and they're trying to start marketing or launched an ecommerce shop or something. How would you go about that? Because I used to read quite a few books that talked about scrappy ways to do it, whether it was just putting up a landing page and then maybe linking to products, reselling them. There's so many things that we've been taught when it comes to being scrappy and starting something without having to invest money, but how would you do it now in 2021?

Erik:

Yeah. Everybody loves to throw around the MVP model, minimum viable product. The problem with it is people go to minimal and not viable. Meaning, you make a product that gets out there, but it's not really viable. It's not really what somebody's going to buy from. It's a landing page that sends you to a site that says you can check out but you can't or whatever it is. People think that just getting up and running is good. You got to commit.

Erik:

If you're just getting started, keep the day job, make money along the way. If you can't work a day job, then you get started on midnights and weekends, you're not going to be a good entrepreneur, because welcome to entrepreneurial life. So, that's actually a good way to get used to it in my opinion.

Erik:

Also, it never happens as fast as you want it to or almost never. So, it buys you time. You're not under some ultimatum that if this doesn't work in six months, I can go back to work. It's like well, just give yourself as much time as you need. Switch over when it can support your lifestyle. So, to get started, I mean, there's a few ways. If you're trying to launch a new product, you might need to put in 10, 20, 30, 50 grand to get started. That's actually a thing. That's where the friends and family come in if you're launching a new shoe line or something, but start small. Sell out. It's okay. Meaning, sell your product, not sell out as a jab or anything. It's okay to have a small run in the beginning.

Erik:

And then in terms of marketing, I've really honed in on this focus, actually, through a lot of answering these questions on Clubhouse is where we invest our investment threshold and where we like to look at companies is 20 grand a month in revenue. Because honestly, that's when you've been able to get over the scrappy period and you started to build a sustainable business. Still small, but there's something there. That's traction to us. To me, it's like get to that point without spending too much money.

Erik:

Partnerships, get someone that has your audience that you're trying to reach and find a way to make them talk about you to their audience. That could be press. That could be influencers. That could be other brands that collaborate with you. That could be many different ways. But start there, start building that organic reach groups. If you're selling shoes, not in COVID, but in general, sell them out of your trunk. Don't make it so it just has to be through your website either.

Erik:

My view is focus on one thing, and don't narrow yourself in other ways. The idea of being direct consumer and not opening up every other distribution channel for your brand is crazy to me. Go omni-channel, open up retail, open up everything else, and build a model that makes sense for all of those, and then see where the least path of resistance is. Maybe Nordstrom decides you got the coolest sneaker ever and you get a $5-million order. You're able to ask the right people, so you can protect yourself, because a lot of those big box will return the entire order when they don't put it on the shelves.

Stephanie:

Oh, wow.

Erik:

So, there's ways of that-

Stephanie:

[inaudible 00:25:50].

Erik:

That's why retail is hard. Walmart, they charge you for the products that don't sell and send it back to you. So, you got to be careful on those agreements and what you take on, but listen, it can also set you up for the rest of your life getting a deal like that. So, open it up to do all those things and be scrappy about it. Instead of throwing other people's money and trying to grow and hoping it works, find ways to make money right away. As someone that has bootstrapped a business and owns it with my partner, but the two of us, it's awesome. We tell our team all the time, "Anything you want to do, we can do it. Just ask." We're not reporting to anyone. We don't have people on our board or investors that we have to report to that are going, "I don't agree. I'm worried about the risk of my money." Not all investors do that, but some do. So, yeah, if you can keep ownership, it's a lot of fun. It's stressful at times too, because there's no one else backing me up. It all falls on you. But once you get through those hardships and get used to that challenge, because it never ends, it actually becomes pretty fun.

Stephanie:

Yeah, yeah, that's definitely my viewpoint on investors too. Unless they're very strategic, they're going to open up a network for you. They're going to give you something that you can't get otherwise. If you're just going after money, you probably needed to look elsewhere. I mean, my friends and family, not so much. I would have never been able to raise any money from them properly. But, thinking about it more strategically, instead of just, "Here's some dollars," because we had a guest on the show, who I forget who they were.

Stephanie:

Maybe Hillary can remind me in our prep doc here, but they're talking about how they built their company based off a Kickstarter Indiegogo type of thing, because they had this whole quote that was, "Don't rely on friends and family." Because if that's how you think you're going to fund your product, you're already going to fail. Account for them to maybe only be 3% of what you need or something like that. Only 3% of your product will be bought from them. The rest, you need to go out and form those email newsletters. Find your audience elsewhere, or else, there's no point in you trying if that's your only goal.

Erik:

Yeah, I would say that with smart money, which I agree with, if you're going to take money, take smart money that knows what they're doing and can help you. But a lot of times you can get that help without even taking their money. That's the other part. There's an anecdote about call someone for advice and they'll give you money. Call someone for money and they'll give you advice. So, if you want connections, most people that have been successful, most not all, but most are really willing to pay it forward, I've noticed. They want to help. They can't help everyone, but when you catch them at the right time... And then for anybody, it's a game of numbers. If you're looking for help, reach out to as many people as possible. Someone's going to say yes.

Stephanie:

Yup, I agree. So, the one area that we sometimes neglect on this show is B2B commerce, because of course, everyone's focused on B2C. But I saw that you put out a list of tips for B2B ecommerce companies. I was hoping you could walk through, what are you guys seeing for B2B companies? Do you work with B2B companies? How are you advising and marketing for them right now?

Erik:

Yeah, I mean, in the nutshell, B2B marketing is actually very similar to B2C, except for the end goal with B2C is a transaction. B2B generally is to drive a qualified lead, but you're still marketing to an individual. That's the part that I think people really forget. When I'm marketing to B2B, I'm not marketing to a business. I'm marketing to the decision maker at that business. So, it's still a person. So, instead of marketing to someone that likes dogs and biking, I'm marketing to someone that has this title at this type of company, who's a marketing manager at a Fortune 500, whatever it is. So, it's just a different targeting methodology.

Erik:

And then the way you position the company is still value proposition. You still want to get an emotional reaction. That doesn't mean like go crazy with it. So, don't take that too verbatim, but people justify emotion with logic. So, if you can hit the emotional reptilian side of the brain and get with any type of marketing and get them to feel like you're going to do something for them, that's the best way to get someone. So, Hawke Media is all B2B obviously. We don't use it that much now, but we're about to ramp it back up. Have you seen our commercial with the lemonade stand?

Stephanie:

No.

Erik:

Super fun. We filmed this less than a year into business, I think. I sat with my business partner. Again, we're marketing to business owners. That was our main target. They were like, "What do people like?" I'm like, "Puppies and kids." It was just when GoDaddy got banned from the Super Bowl for putting a puppy mill as a joke commercial. I was like, "No, let's not do that. So, let's go with kids." So, we basically created the commercial about a bunch of kids in a really corporate office.

Erik:

But when I say kids, eight, nine year old's running around, skateboarding, throwing paper airplanes, freaking out. The owner, this little blonde girl going like, "I can't take this. Who's handling our Facebook ads? Who's doing this?", and just freaking out. And then we come in and we got you. I was in the commercial too. We explained that. It shows them at the end, a bunch of kids making it rain with cash and dancing and having fun.

Stephanie:

That's cute.

Erik:

It was fun. It got people's attention, but the whole point was, "We got you. I know you're freaking out, but we're not and we got you." That's how it came off. That emotional connection, even though we're talking about B2B, which you'd think is super logical. How much do you cost? How much money you're going to make me? No. Why people hire us, the logic reason is bandwidth's our expertise. The emotional reason is, "Please someone just handle this. I don't know what's going on here. I just want to grow and I need someone to take it off my plate," or "I don't know what I'm doing." We need someone to just come in calmly and help us.

Erik:

Understanding that in B2B is super important, because then everything you do with positioning yourself is like, "We're here. We got you. We know what we're doing." You can sleep easy at night is our positioning. Now, you change that. And then how you execute on that, same channels, Facebook, search, email marketing, press, all the things we use for our clients, creating your own content is the stuff we use for ourselves.

Erik:

I'd say any marketing is aspirational. Not meaning I aspire to be like something great, but more like, "I'm currently at this state, and I want to be here." It's as simple as my socks have holes in them. I want comfortable socks and you go buy socks. This aspiration doesn't have to be something groundbreaking. So, understanding that you need to position yourself as that aspiration, the solution to getting the person from where they are to where they want to be, no matter what you're selling, B2C, B2B, is the most important part.

Stephanie:

That's really good. Yeah, I mean, I think about the ads to B2B and they're so lame. A lot of times, they make things so corporate. It's like, "I'm pretty sure any corporate citizen will not want to watch another corporate style ad." They want something new and different and love to just connect with the person. Even if it's a title that you're connecting with, there's someone behind that title. If you wouldn't like it, they probably won't either.

Erik:

Yes, exactly. That's been the awesome thing about Hawke and its marketing specifically is I'm the customer, literally, who would be buying from us. That's why I created it. So, I get to make things that I didn't want to see. You just nailed it. I hate the boring, stodgy, men and women in suits. We've been trusted for 25 years. Who cares? That's not why I'm hiring you.

Stephanie:

It's like the stock photography, where you go on there. It's like all these people in offices and business suits. I'm like, "Who's buying this stock photography? This is horrible."

Erik:

My favorite, I used it again recently. So, that's why it reminded me. Remember that photo shoot they did with the baboon doing stock photos in an office. I just found it. My brother-in-law asked me what I was up to this weekend, I sent him the baboon banging on the keyboard. I'm like, "Just working." That was a great shoot. That was so perfect. Yet so many people did not get the point of that, which is this is ridiculous. Why are we taking office stock photos?

Stephanie:

Yeah, yeah, that's funny, but I mean, a lot of people use them for a while. I guess it worked for probably a solid week, and then everyone realized it's not working anymore.

Erik:

No, no, a lot of people still use the office photos. Listen, that's not going to be the only driver of your business. You don't have to be perfect in marketing. If you have a good product or service, marketing helps, but it's not critical. So, a lot of people get away with really bad marketing and still have a really good business.

Stephanie:

Yeah, the one theme that I've heard from quite a few people on the show is that the organic videos and natural things are all performing way better than stock photography or anything that seems like it was built out of the box. Are you seeing that as well?

Erik:

It depends. It depends on what type of product it is. If it's a product that needs a lot of trust, you need production value. Meaning, a supplement or something that people are looking to solve a problem. They don't want to see that you threw something together. If it's like fashion or lifestyle products that people aren't really worried, you can get away with that a lot more.

Stephanie:

Yeah, I like that. So, one other thing, I don't know how much do you guys experiment with TV, because I was listening to a good episode. I forgot what podcast it was, but I think it was Gary Vaynerchuk, where he was essentially saying, "All TV is dead except for Super Bowl ads." That's the only ads that actually work. Every other TV commercial, they don't work anymore. They're dead.

Erik:

Gary's a friend and I think he has nailed what he's doing. He's a super bright guy, but I think a lot of times, he speaks in hyperbola. Nobody ever gets held to these big grandiose claims. I called a friend out for claiming that Bitcoin will be at 50 grand by Sunday. And then Sunday came around, I screenshot it and I sent it back. I'm like, "What the hell, man?" He's like, "Whatever, it'll happen in the next month." It's a habit that a lot of people got into, making these giant claims. I'll be real, TV does work. You got to buy it, right? Yeah, we do some TV, some radio. It's not a big part of our business. I'm not trying to hype it up.

Erik:

But once you have an amazing funnel and you really know who your customer is and you're really good at nurturing leads... Meaning, not just letting them come to your site and hopefully, they buy, but capturing email, capturing their phone number to text them and follow up and really nursing them. Again, you know your audience and you know your messaging. So, you know how to attract your audience and get them to buy. TV is still one of the cheapest places to get a 30-second impression from a massive audience. So, both TV and radio are still very viable options as you scale, but you can do a lot of digital before you have to go there.

Stephanie:

Yeah, yeah. Yeah, I agree. We had one of our podcasts aired on radio. They took it and turned into a one-hour special for Veterans Day. It's called The Story. Some people were like, "Radio is dead. Why would you want radio?" I'm like, "Do you know how many people still listen to radio?" Actually, it's still very legit if you can get on radio. I mean, it's huge.

Erik:

Most people are sitting in their car. They're not going anywhere. They're not changing the station either, because, frankly, there's not that many options. You can get a lot of people that are doing nothing. The hard part is to get them to remember things, but it works. We've had a lot of luck, especially event sales. When we're doing big events like TED and stuff like that and trying to sell tickets, DutyCon was a good one, radio works really well.

Stephanie:

Yup. Yeah, like you said, getting that CTA, where it's not something that's distracting or they crash, but seriously, going by what I just talked about.

Erik:

Yeah, exactly.

Stephanie:

All right, only couple minutes left. Let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready?

Erik:

I'm ready.

Stephanie:

All right. What's up next on your podcast list?

Erik:

Who is or what?

Stephanie:

Either, who or what? What are you listening to?

Erik:

Oh, well, we have our own. So, who would be Rachel Zoe.

Stephanie:

You have her coming up?

Erik:

Yeah, we've worked with her for years. She's awesome. Yeah, so that's the next one. And then after that is Rob Dyrdek, I think. I want to get more into How I Built This. He's awesome. I just think that that's always an interesting story. My podcast is more about their life story. His is really about how they built their company. So, I like the life story too. My podcast was I wish someone did this. So, I'm just going to do it and hit up cool people and find out how they got where they are. Yeah, so my podcast is Hawke Talk.

Stephanie:

Awesome. Yeah, I will be checking it out. What's up next on your reading list?

Erik:

Whatever my business partner assigns me. I am not a voracious reader, and my partner is. So, he's decided-

Stephanie:

He assigns it to you?

Erik:

He's decided as of last month that he's going to give the executive team including me a book a month that he wants us to read and be on the same page on. I'm all about it, because I don't have any motivation on my own to really do it. I'll pick up a book now and then probably a couple a year. Most of the time, I end up listening to it on Audible. I'll buy the book. I buy all my friends' books. My wife rolls her eyes every time. I got to support, but I don't read any of them. Sorry, guys. We're coming out with our own book towards the end of the year called The Hawke Method. It's how we grow companies, basically.

Stephanie:

That's awesome. I love that. What one thing do you not understand today that you wish you did?

Erik:

I wish I understood the public markets more. I've put money in it now and started to try to learn it, but I've surface level things I understand. But when we started getting into derivatives and the complicated side of finance, I'm still not completely clear. I've also shied away in some ways, but I think when you overcomplicate it, it's too complicated for everyone. That's when we get into the housing crisis and things like that, but I also would love to understand it so that I can call bullshit on it sometimes, because I realized in my entire career, no one's that smart. If it's complicated, it's probably a problem.

Stephanie:

Yup, that's a good one. What favorite piece of tech are you enjoying right now? It can be new or something you've used for a long time. It can be an app or anything.

Erik:

Yeah, I will say the one that surprised me the most is the Oculus, because I've been a naysayer of VR. I'm like, "VR is too isolating. It's stupid, blah, blah, blah." But once I got one and I ended up helping an organization called YPO do an event with Oculus and got one, and I'm like, "Oh, wow, no, this is interesting." There's actually something to VR and the experience you can have. Most people can only use it for 45 minutes at a time, but I think it's really cool. I think there's something coming down the pike with that that I think will be really cool.

Stephanie:

Yup, yeah, we wrote a 2021 Trends Report. That was something I'm keeping an eye on is how to use that when it comes to not only following influencers, but shopping from feeds and watching live events, but also being able to get it while watching it and stuff. I think there's a little work to be done, like you said. I know a lot of people especially myself still get dizzy and not feeling very good after, for me, 10 minutes, but it seems like once that gets a bit better, there's a lot of opportunity, especially for ecommerce companies if they can figure out how to make it an event and something fun that people want to attend.

Stephanie:

Plus, also, it's like The Container Store in Netflix series. You want to buy with the Netflix series ad, even though they don't really slap you over the head with Container Store stuff, but you're like, "But I need that specific box to put my scarves in."

Erik:

Yes, exactly. No, I think that's exactly it is. The business model needs to be fixed around the content for VR, because it's just not good enough yet to track enough content and things to do. But once that turns into a much more prolific platform, I think that you'll see it hockey stick quick.

Stephanie:

Yup. All right, last one, what is the nicest thing someone has ever done for you?

Erik:

Oh, I have to think of a nice thing, because I feel like if I'm going to say the nicest, it's going to be...

Stephanie:

Or you can say the meanest too. You're like, "Oh, this person was really mean to me."

Erik:

I had a business partner that really screwed me up, but I don't need to give it any credence. Not my term.

Stephanie:

Nicest then.

Erik:

I'm trying to think of nicest. I mean, the fortunate thing is many, many people have done a lot of nice things for me. A lot of people taking bets on me before I had any reason to deserve them. My parents were always great to me. My wife's great to me. I'm surrounded by people that do nice things for me. So, I will say a nice thing that stands out that I never give enough credence to is when I graduated college, I went into real estate a week before the whole banking industry collapsed. I made $350 that year.

Erik:

Six months in, a friend of mine's dad called me. I was a guitarist growing up. My drummer in my band's dad called me and said, "Hey, I've been watching you. You seem to be like a young, aspiring entrepreneur. I like your grind and your spirit here. I want to help people like my son, who is still pursuing music, figure out how to do the business side of things. So, they can actually at least make a living being a musician. I think there's a thing we could do here." I spent a couple months putting a business plan together, showed it to him. He not quite disappeared but went MIA for three months.

Erik:

Called me July of 2009 and said, "Hey, I'm putting in a quarter million dollars. I think I can raise this another $750,000. You're going to run it. Let's go." That became my first online company. So, that guy put in his own quarter million dollars, got his friends to put in $750,000 million invested in an online music company in 2009. And then put me in charge of it, gave me 5% of the company and paid me minimum wage, which I was grinding.

Erik:

It was a bet. Don't be wrong. It could have really worked out for him, but I also think of that as that guy set me up as an entrepreneur in a lot of ways too. I don't know what I would have been doing without that opportunity. I'd probably still have grinded through real estate unless something else popped up for something. That put me into digital. That did a lot of things for me. I'm still in touch with them, but that was a big one.

Stephanie:

That's a good story. I'm glad I asked. Yeah, that's really good. Cool. Well, Erik, this has been a very fun interview. I want to bring you back for another round in the future to hear how 2021 is going. Where can people find out more about you and Hawke Media?

Erik:

Definitely, Clubhouse.

Stephanie:

I'll see you there.

Erik:

Yeah, [erikhuberman on any social platform's fine. And then Hawke Media, if you ever want to reach out, is just hawkemedia.com. We do free consultations. Always happy to help.

Stephanie:

Cool. All right. Thanks so much for joining us.

Erik:

Yeah. Thanks for having me.

Breaking In By Breaking Free: How Zak Williams is Building PYM to Advocate for Mental Health

info@mission.org (Missioin) — Thu, 28 Jan 2021 08:00:00 +0000

Imagine this: You’ve developed a new product. One that you know works… and that you know people need. There’s just one minor problem: Selling that product requires you to not only enter a battlefield filled with regulatory land mines, but face competition with billions of dollars at its disposal.

We’re seeing this situation play out in the multi-trillion-dollar industry that is supplement and pharmaceutical sales. It’s an industry that entrepreneurs everywhere are trying to make waves in, and just like any other industry, finding success means coupling the right product with the right strategy.

Zak Williams was able to kick the door open with his company, PYM, which sells all-natural amino acid-infused chews that have proven mental health benefits. Zak is the son of the late actor, Robin Williams, and he is using his own experiences navigating the ups and downs of mental health to help him build PYM into a company that advocates for mental health support in whatever way works best for the individual. Practically, that means working out a business strategy that allows PYM to not compete against big pharma, but sit alongside it. And it includes developing new kinds of convergent experiences that allow consumers to operate in a physical and digital world simultaneously. Zak explains all of that and more on this episode of Up Next in Commerce.

Main Takeaways:

Play Where You Can Win: For companies that are selling natural products, trying to sell in the same channels as big pharma would be a mistake. Not only will you not be able to make the same claims about proven solutions, but you will not be able to afford to acquire enough customers to make it worth it. Instead, find other channels or methods of marketing where you can stand out, either organically, or in a more affordable way.
Do Your Research: Making wild, unproven claims has always been a bad strategy for brands, but it is especially reckless when it comes to how something can affect a person’s physical or mental health. Invest in real research to back up the claims you are making, and be authentic with your message. Rather than trying to convince customers your product can cure something, help them open their minds to new experiences and products that might be part of a daily ritual or personal blend of what works on an individual basis.
Convergent Experiences: As a new normal emerges post-pandemic, brands will need to focus on creating convergent experiences that allow people to engage in the physical world while still using a digital experience to achieve goals and objectives.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome back to Up Next in Commerce. This your host, Stephanie Postles, co-founder at Mission. Today I'm chatting with Zak Williams, the co-founder and CEO at Pym. Zak, welcome to the show.

Zak:

Thank you so much, Stephanie. It's a pleasure to be here.

Stephanie:

Yeah. I'm very, very excited to have you on. I was going through my amazing prep dock, and I first thought that Hillary was playing a joke on me when she wrote down Zak's the son of actor Robin Williams. She likes to put in silly things to see if I'm going to go with it. Then I'm like, oh wait, this is actually real. I started reading a bit about your story and your company, and I would love for you to actually start with that. Tell me a bit about what led you to Pym, and yeah, expand on that, because I was really excited to hear about the full story.

Zak:

Yeah, certainly. What led me to starting Pym, the mental health support company, started very early on in life. I had anxiety throughout my teens that manifested into something more extreme after my dad, the entertainer, Robin Williams, died by suicide. I found myself experiencing bouts of depression, also extreme anxiety and stress episodes. I was feeling like my life was becoming unmanageable. I was trying to use alcohol to self medicate and was trying to find any other solution that would work. I tried cannabis products, had prescription pharmaceuticals, which work for many people. For me, I didn't find the solution that necessarily helped me in a way that would work in perpetuity. Then I found some help in things like talk therapy and alike.

Zak:

Through that experience, a couple things happened. One was I was diagnosed with post-traumatic stress disorder and was dealing with a lot of issues associated with that. The other thing is I started to find help and support through committing to service, specifically working with mental health organizations, not for profits; supporting them around things like governance, organizational development, fundraising initiatives, strategy, business development. Whatever it is they needed help with, I wanted to jump in and support because I found actually that commitment to mental health organizations really helped me. Through that experience, another thing started to happen, which I found that me sharing my story and what I went through really helped others while helping myself. I found that being vulnerable and taking a lens of vulnerability and opening up really ultimately ended up starting that process of healing for me. I found that mental health advocacy is one component.

Zak:

The second component is when I took self medication out of the equation, using alcohol, and by the end I was drinking alcoholically and it was just not good for my mental health. I was feeling very emotionally dysregulated and not having a great time. When I cut out alcohol, I was still really stressed and really anxious, and realized that I needed something to support me throughout the day. I found a solution that my wife introduced me to. My wife, Olivia June, who's also co-founder of Pym. She turned me on to amino acid formulations, which when I tried them were a game changer. They helped me feel clear and erased the anxiety that I was feeling and that was ultimately crippling me. She was introduced to this sublingual tincture by one of her doctors. When I tried it, I was just like wow, this is transformative.

Zak:

Armed with the insights of mental health advocacy is very healing for me, and amino acid formulations really helped support me throughout the day, I realized there was an opportunity to develop something that was very near and dear to my heart, but also helpful for people while focused on the core mission of mental health support. I started Pym with the lens of creating a brand that stands for mental health support, like Red Bull stands for energy. In starting the company, we kicked off the food science and product development element of that in 2019 and created something that was both safe and effective, while also being delicious. We worked with a food scientist named Lena Kwak, who was the director and research and development for The French Laundry, which is a restaurant in northern California; a very well-known internationally regarded restaurant in California. We wanted to create something that had a great taste and smell and a texture that felt unique but also toothsome.

Zak:

We came upon something that we ended up testing with our early beta testers that they liked and they found effective. We kicked off the commercialization phase when we decided that everything was in line with not only how we wanted it, but how our beta testers felt it should be. Through that process, we hired the chief operating officer of Sugarfina; a wonderful man named Scott Cuillard who came on as our chief operating officer, and he accelerated the process of commercialization by 200%. Now we're at market. We're just getting this feedback from our customers and early advocates that our product is a lifeline and it's helping people in a very significant way and we're doing these giveback campaigns where we're supporting mental health organizations, starting with Bring Change to Mind, which is an organization I'm on the board of that focuses on developing communities and high schools for mental health support, while launching campaigns to break down the stigma associated with mental health.

Zak:

Moving into 2021, we will be deepening our relationship with Bring Change to Mind and have a portion of our proceeds of every sale going to supporting building mental health communities and high schools. That's what we've been up to in a nutshell. The why behind it relates very much to mental health advocacy. We see ourselves as a brand that stands for advocacy and we want to really triple down on supporting the movement associated with mental health. That's what we're all about.

Stephanie:

That's great. It seems like this kind of product would have a lot of barriers to entry, because when I think about the market right now around mental health products and CBD and cannabis and all this stuff, there's already a market there. There's already been a lot of messaging, a lot of advertising before a product based on amino acids, which honestly, I haven't even really heard of that. Tell me a bit about how you overcame those barriers and educated new audiences or are starting to. I know you just recently launched, but tell me a little bit about that process to really get your product on the front of people's mind.

Zak:

Sure. Amino acid formulations for mental health support is not a new thing. We didn't miraculously come upon something that was new to the world. They were gaining momentum and popularity as a way to provide mental health support by balancing out the endocrine system in the 80s and 90s. Something happened in the 90s that set off an era of a pill to solve all your problems in life. Kind of that era of taking a curative approach to symptoms. Do you know what that event might be?

Stephanie:

I'm guessing you're talking about prescription pills, but I don't know what the event is.

Zak:

Yeah. Actually, it's a very specific prescription pill. It was the creation of Prozac. The profound thing about Prozac is it was a product that would function as an antidepressant that would not kill you if you took it in excess or stopped taking it, because at the time, the available toolkit of prescription pharmaceuticals had toxicity associated with them. In certain situations, you could take a product and if you stopped taking it, you would be at risk of severely debilitating affects in the like. Prozac created kind of a safe mechanism to provide mental health support. By the way, I'm a big believer in prescription medication being helpful for many, many millions of people. I don't want to make it seem like I'm not supportive, but the momentum that amino acid formulations were getting kind of fell by the wayside and didn't favor of this era that lasted a couple decades of a pill to solve all your problems.

Zak:

It's only been in the last five plus, just over five years, from my perspective, that the whole idea of seeing the individual as a system, as a collection of interacting organs and functions working together to help support and sustain the body, that idea and premise has really been embraced in a major way by the medical community. Going hand in hand with that is the idea and premise that you can take certain products, to kind of balance yourself out, because they provide support for a number of different systems and create kind of a balanced ecosystem to better help you. That's kind of where amino acid formulations kind of come into play.

Zak:

From our perspective, we just concentrated these existing amino acids in a way in which they actually provided a more comprehensive form of support for stress and anxiety with our first product. That's the story in brief, but the challenge is very specifically we need to popularize amino acid support as a way of providing mental health support, because there's science and research behind. Science, research and studies behind amino acids being helpful for people, but people aren't too aware of it.

Zak:

As part of forming the company and making the effort to formulate something that's helpful for people, we established the science advisory board from Harvard Medical School, UCSF, USC, and MIT, and with specific focus on neuroscience and neuroendocrinology, with some mental health epidemiology being an element of that as well. As part of that, we are in the process of establishing a pre-trial study, which we'll then use as a foundation to go into an actual clinical study that we'll be using to really get a deeper understanding of how we can provide decisive support for the mind and the body. We're kind of in the brave new world of natural compounds providing support both for the brain and the mind and also the body, but I'm an advocate and believer in compounds that are safe and effective.

Stephanie:

Yeah. It does feel like the timing's right. 2020 is a year where I've at least seen a very big shift in not only healthy living, but people actually looking into the source of what they're ingesting and thinking about healthy alternatives to not only their diet but also things they're taking, whether it's prescriptions or whatever it may be.

Stephanie:

It feels like the market's ready for it, but then figuring out ways, like you're doing, to pull it together and put it in an easily, I guess, consumable format where people kind of know, oh, here's the five things that are coming together, here's what they're going to do. Someone's already done the science behind me, instead of trying to piecemeal these extracts and things off of Amazon together to try and fix a need based on all the YouTubers and influencers and people who are telling you oh, this is good for this, and this is good for this. It's so much information now.

Zak:

Right. That's what I was doing. I was cobbling together an experience that helped me, but it was a bunch of different products. I agree. I think that there is a major opportunity on the research side too. There's some great companies that are focused on establishing more research through studies. Some registered, some focused more so on doing the research to really understand how things work prior to actually doing registered studies. There's organizations and companies that are focused on actually creating frameworks to do the testing. I will give a specific shout-out to my buddy, Jeff Chen, who was one of the founders of the Cannabis Research Initiative at UCLA, and he recently started a company focused on doing research around natural compounds. His new company, Radical Science, is hyper-focused on establishing frameworks, specifically clinical frameworks, around testing for natural products. It's so essential that people actually really start understanding what it is they're putting in their body to support themselves.

Stephanie:

How do you approach that regulatory field? Like you said, to me, it sounds so scary entering a market like this one where you're doing things for the first time, it's new, people aren't used to it. How did you approach this field and did you find any quick paths to get past some of the crazy rules and regulations to be able to actually start creating a product and testing it and seeing how it would work?

Zak:

Yeah. Great question. It wasn't a cold start for me. I have several years of experience working with complex compliance and regulatory environments due to investing, advising, working within the cannabis industry.

Stephanie:

Got it. Okay. That's good background. You weren't a newbie to this. I've done this before.

Zak:

No. The lens we take. I say we in terms of our team and our advisory board is prioritizing compliance and safety. In starting the company, we sought the most sophisticated advising we could get. We need to continue prioritizing safety as front and center with what we do. We're a dietary supplement as a product class, and it's important to consider how we make claims. We are very cautious with how we do so because from our perspective, we are given the privilege and opportunity to provide support for people given a specific framework, and we want to be considerate of that framework. The key thing for us is as we go about doing studies and the like is we want to develop a deeper understanding of how we're actually providing support for people.

Stephanie:

Is your goal to not just be a dietary supplement eventually?

Zak:

The big goal for us would be to become a doctor recommended product, or there's a class of products called a medical food. What a medical food is is a product that is meant to support specific disease states in the like. It's a product class. It means there's a lot of research behind how it's been effective to support different states. You can make specific sets of claims.

Zak:

From our lens, the reason why medical food establishing that type of status is important for us is because that way we can actually say we've done X amount of research, it's shown to be statistically significant, and we can really make these specific claims around supporting people. That's a process. That takes a long time to do. It's not inexpensive. There's stages that we're required to kind of get through to get to that point.

Stephanie:

How much money are you estimating it could cost to have your product become medically food stamped? That's a weird term.

Zak:

There's a range. Depends on what type of condition we're seeking to support and how long the study is meant to be conducted. Generally, these studies are months long. In some cases, over a year. It's not inexpensive. Let me frame it like that.

Stephanie:

Yeah. I guess that it what makes me worry about maybe new entrepreneurs who see opportunities or if they're like you, but they don't have connections and they don't have the story that you have and maybe the status. You'll probably be like, don't say that, but you have a lot of things that maybe a lot of others don't. It seems like innovation's going to kind of stall if it takes so much money to get something natural into the world, or a blend of something natural, and then to be recommended over top of prescription drugs where these pharmaceutical companies have huge amounts of money and marketing.

Stephanie:

I read this whole book about... what was it called? Let me think. It was called like the cure to cancer or cure of cancer. Something that was abour apricot oil and the apricot seed. I don't know if you've ever read this before, but it was about how this guy was showing that apricot oil, I think that's the kind of oil it was, was having a big impact on cancer and cells and all this. All a sudden, these big pharmaceutical companies start putting out hits on him. He had to go to a whole different country to prescribe it. It seems like an insane world to even try to do something new just to start, and then also not having a huge budget or connections. It doesn't feel like anyone can enter this market, really.

Zak:

There's ways to do it. The barrier to entry in terms of launching a natural product is not as high as, say, launching a pharmaceutical product. You have to make certain assertions to say hey, this product will be effective. It seems to help people, and you have to generate demand. We've very much in the business of demand-gen. From a Pharma perspective, I would say that pharmaceutical companies are actually taking a lens of openness towards utilizing natural compounds to better support people.

Stephanie:

They're not taking out hits on you.

Zak:

No. Where it gets challenging is if you're going out and saying, we have a mental health support solution, and you go in certain channels where you're trying to advertise, you just get squished. You just can't afford to acquire a customer when you're talking about going in a channel which people are seeking certain mental health support solutions through search, for example.

Stephanie:

You have to find ways to maybe be innovative to not have to rely on the same channels as maybe the big Pharma companies and find ways to get to the users who are probably looking for that, but they just don't know exactly what to look for or the terms to search for.

Zak:

The big advantage that entrepreneurs should look for when it comes to creating an edge, an unfair advantage in this space is distribution advantages.

Stephanie:

Tell me more about that.

Zak:

Direct to consumer, there are some advantages, but there's also some disadvantages. We have had limited success with paid search. It's just hard for us because when people are searching for specific needs, that can be very expensive from an SEM perspective.

Stephanie:

What do you do instead if paid search is expensive for us? What kind of channels are you maybe looking at instead or experimenting with where maybe you're finding better results?

Zak:

We've had enormous success with earned media and organic SEO in the like, but that's a strategy we set out from the get go in applying. I come by our company and the products very honestly. Part of what I do in mental health advocacy is just share on a story consistently and when it's combined with Pym, people are curious. Sometimes they end up being drawn and attracted to our product. The thing too, which we found has been helpful for folks is that we're not advocating for a product to be a cure-all. It's actually kind of I don't want to say the opposite, because that's not quite what it is, but it's kind of adjacent to that. Really what we're saying for is our product's a catalyst. We want to get people into the mindset of prioritizing mental health hygiene as part of their daily rituals. Hopefully our product's a catalyst. If they're taking our product as the solution for their mental health support over the course of their day, that's great, but ideally, they should be doing other things to best support themselves.

Stephanie:

I think that's the messaging that will win going forward. All the companies I've had on the show so far, so many people talk about authentic messaging and not just having the same kind of corporate speak like maybe they used to years prior or something. I think thinking about how to craft that going forward, it's actually more trustworthy if you say something like, this isn't a fix. This is meant to be a part of your daily routine along with exercise and eat healthy and whatever else you need to do to stay healthy.

Zak:

Yeah. The thing for us we really want to push for and advocate for, something I call enrichment loops. Meaning if you come to our product and take it on a consistent basis, hopefully it adds value every time. Meaning you're clear headed, you can learn something, you can engage in an activity that's helpful. If that's not the solution for you, then we're not going to push it on you. Do something else that helps you. Again, this is where prescription pharmaceuticals, if you're finding a solution with prescriptions, by all means, take that solution. If it's meditation, if it's mindfulness activity, if it's a fitness regimen, If it's nutrition. For most people, it's most likely a mix. For me, it's a mix of meditation, eating well, some fitness, but I could definitely be better on it. I take Pym because it helps me. I'm a big believer in talk therapy and community support groups. That's my mix.

Zak:

To close on the unfair advantages in distribution. If you have a digital channel like an app or something, we're exploring creating a companion experience. That gives you an ownership of being able to really provide unique insight, pushed out notifications, establish a foundation of data that better helps you understand what it is a customer needs and there's an advantage there. I think blending DTC with Omnichannel is a huge opportunity, but Omnichannel can often work as just establishing brand presence that ultimately pushes people into DTC, or vice versa. It could be DTC that ultimately pushes people into a daily loop, ideally an enrichment loop, around purchasing products at their natural grocer. Okay. I'll close at that, but I think focusing on unfair advantages in distribution is how entrepreneurs will get ahead in a very challenging space.

Stephanie:

The one thing I've heard a lot is a lot of entrepreneurs that I've talked to on the show, a lot of them have really good stories, but not everyone tells it. Some people are hesitant to tell their story. Did you experience this with everything that happened? Did you ever feel a need to pull back and you weren't sure if you wanted to share or you weren't sure what you wanted to talk about? Tell me a bit about how you thought about sharing your story and resonating with people. Were you scared at an point to do that, because I've heard a lot of people have been? I don't know to tell.

Zak:

Regarding story, look, the lens I take is that there's great strength in vulnerability. I've been guarded a large part of my life, and not sharing my experience and alike, I've realized that I was losing out on opportunities to help people. I was given many advantages in life, and there are elements that have been disadvantageous. Instead of seeing it as that and seeing it as kind of a foundation for resentment or being annoyed around certain things, I say, this is just part of my experience. There might be shared experiences or there might be something that would be unique to your experience or not very many people, and I think that needs to be embraced.

Zak:

My whole thing is share my perspective and story. As it relates to Pym, try to be considerate of really the advocacy that underlines what we're doing as well because that's what really matters at the end of the day. I think people just need to find what it is that they want to tell, and really understand that they're crafting their story in the present, in the now. You don't want someone else's story. Own your own. It's a muscle. I had a lot of fear and anxiety around sharing stuff for a large part of my life.

Stephanie:

Now you're talking about even before your dad's passing you were not very vulnerable. What pushed you to want to start sharing, and why do you think you were holding back before?

Zak:

I think I was doing certain things that I was ashamed of. Drinking has always been a problem for me. I'll be perfectly honest, and it was something that only came to a head where I was like whoa, this is getting out of control after my dad died by suicide, but prior to that, it was something that was a challenge and I wasn't liking doing it. I think there were elements of my story that I was ashamed of, perfectly frankly. To be perfectly frank about it. In that, I realized there's certain elements of my story that are private and I relate to being considerate of the sphere of individuals or communities that are titled to that. Then there's elements that I love to share and talk about. The thing for me is when it comes to mental health, talking about mental health and alike, I like talking about it because it's very healing for me.

Stephanie:

Mm-hmm (affirmative).

Zak:

Yeah.

Stephanie:

Very cool. Before the show started, we were talking a little bit about converging experiences, and I want to hear how you're thinking about this, especially with probably giving certain talks that now, this past year, had to all be virtual and not as much in person. Tell me a little bit about how you're thinking about online and offline blending and what you guys are betting on for next year.

Zak:

Well, the big bet we're making is that people will continue needing mental health support products.

Stephanie:

After 2020, yes.

Zak:

Yeah. Here's the thing is that relative to the pandemic, there's been a shift into the COVID pandemic. We can talk about the parallel mental health pandemic, which is a thing too. There's been a shift to kind of embracing and engaging, or customers, communities, populations embracing and engaging in digital experiences, whether it's telehealth, things like that or for meetings, remote work, Zoom, things like that. We're hitting the stage where we're starting to see what a post-pandemic world will look like. Just little glimpses of it. There will likely be people wanting to connect with other people in person, people wanting to go out and shop and dance and eat out in the open. There will be certain habits and there will be people who have become acclimated to digital experiences, but people will also want to go out into the world. I think it'll be interesting to see the blend of online and offline that's going to be this new paradigm. I think as we're thinking about it Pym, we're very much thinking about establishing a companion experience to support people throughout their daily activity.

Zak:

For us, there is a need to really establish a better understanding of how people are requiring mental health support products and experiences. In the neuroscience community, there's something called an adjuvant experience, which has shown to be very helpful. What adjuvant means is... it's very simple. It's just something in something else.

Stephanie:

Something in something else. Wait. What? Sounds simple, but I don't get it.

Zak:

No, it's just an adjuvant experience is talk therapy and some sort of prescription protocol.

Stephanie:

Oh. Okay. Blending two things together. Got it.

Zak:

Yeah. That's adjuvant experience. From our lens, we wanted to create an adjuvant experience that is fun, accessible and accretive in terms of delivering value and support for people. The two things that are most helpful, at least based upon my experience talking with researchers and doctors and scientists about how consumer oriented mental health support experiences can help people is insight and community. The insight component involves behavioral recommendations, maybe data, specific things that help people live a life that they want to live. The community component involves supporting authentic connection with people. Those are the hints in terms of how we're thinking about developing an adjuvant experience, which ideally we hope to be convergent.

Zak:

I see there's an enormous opportunity, and it's very hard to get right. I'll say that. It's in the cake walk, because you need to really factor in blending the online and offline experience into something that feels natural and seamless and ideally, fun. I think a lot of companies are going to be taking that tack, because events are going to be really big, people are going to start eating out again, people are going to start shopping beyond just kind of going out and doing a foray out into the wild and then coming back.

Stephanie:

Oh, it just went to Costco. What a blast.

Zak:

For instance, where Target has really done an excellent job is on their pick-up experience. It's been a game changer for Target this year in 2020. Where you shop, you order online, and then you go to Target and you pick things up. You pick stuff up. That's technically a convergent experience, blending online and offline because it involves you having to engage in the physical world and using a digital experience to achieve your goals and objectives. I think most companies are going to have to think about that in a very meaningful way in order to maintain an edge. I think telehealth platforms have achieved a huge boost this year, but there's going to be some reversion, and it's not going to be a reversion to the previous me. They need to think about okay, what is it that we can do to establish an edge to further support people when they go out into the world again?

Stephanie:

Mm-hmm (affirmative).

Zak:

That's essentially what I mean by convergent experience. From a mental health support perspective, it's really about developing an adjuvant experience. X and Y together at last to create better support for people than the individual parts.

Stephanie:

Got it. I love that. That's a very good example and description, and I feel like I learned a new word. This is a win all around.

Zak:

Hey, it's my pleasure.

Stephanie:

All right. We have about 10 minutes left. I want to shift over to the lightening round. The lightening round is brought to you by our friends at Salesforce commerce cloud. This is where I'm going to ask you a question, and you have one minute or less to answer. Do you think you're ready, Zak?

Zak:

Yes.

Stephanie:

All right. What's up next on your Netflix view or Hulu or whatever you use?

Zak:

I'm excited about watching The Crown. It's been on my list for ages, and we're starting to get through our queue.

Stephanie:

A lot of people have said that, so I'm guessing you're going to enjoy it. All right. What one thing do you not understand today that you wish you did?

Zak:

I wish I spoke Japanese.

Stephanie:

That's a good one. I love Japan. It's my favorite.

Zak:

I love Japan too. For me, the process of learning a new language is already daunting for me. I'm not a polyglot. I don't learn other languages easily. At some point, I should just take the plunge and just start. That's my goal, learning Japanese.

Stephanie:

That's awesome. Sounds like a good goal. If you were to have a podcast, what would it be about and who would your first guest be?

Zak:

My podcast would be about getting to the very core of people's experiences, like what's their truth. Whether they know it or not, hopefully we can uncover that truth. What is it that they're all about? My first guest would likely be one of my favorite people on the planet, Dr. Adam Gazzaley, who is an advisor for Pym and a scientist and a profoundly interesting person that I'd love to get to the bottom of finding his truth.

Stephanie:

This sounds like a good show. I think this needs to happen. What's the nicest thing someone's ever done for you?

Zak:

Well, I'm a big fan of my son, Mickey.

Stephanie:

That's good.

Zak:

Having my wife, Olivia, her having carried Mickey for nearly a year.

Stephanie:

That's sweet.

Zak:

That was extremely thoughtful and considerate of her.

Stephanie:

That was very sweet. I like that. All right. Well, I have two more. What's up next on your reading list?

Zak:

There's a bunch of things, but the main one is Jim Simons' biography.

Stephanie:

Cool. All right. Then the last one, what one thing will have the biggest impact on ecommerce in the next year?

Zak:

The one thing that will have the biggest impact on ecommerce in the next year would be, I think, oh man. That's a really good question. I think it very much relates to more seamless experiences, frictionless experiences. Even though it is quick and can be considered convenient, it could be so much more convenient. I think the disrupters that are establishing quick checkouts, embedded checkouts, connecting wallets to checkout experiences, things like that, that's going to be a game changer, because people who have an edge there are going to really be able to see the difference in their bottom line. I know that's a very tactical consideration.

Stephanie:

That's a good answer.

Zak:

I think that's really one of the game changers.

Stephanie:

Yeah. You'll have to check out our interview with the CEO of Fast. It was very fast, and a good interview and definitely opened up my eyes to what a frictionless ecommerce world could look like.

Zak:

I think Fast is great.

Stephanie:

Yeah. All right, Zak. Thanks so much for coming on here and sharing your story and being vulnerable. Where can people find out more about you and Pym?

Zak:

Well, you can find out more about me through tuning into this podcast and other advocacy work I do specifically. I'll push people to advocacy. I work with organizations called Bring Change to Mind, United for Global Mental Health, Inseparable, and then Project Healthy Minds. Those are the four mental health organizations I work with. You can find out more about me through the work that I do with those organizations, and then you can find out more about Pym at youcanpym.com. Y-O-U-C-A-N-P-Y-M dot com.

Stephanie:

Amazing. I will be checking it out after this. Thanks so much. It was really a pleasure to have you on and love to have you back in the future when your app is out.

Zak:

Awesome, Stephanie. Such a pleasure.

The Solé Way: How Solé Bicycles Battled Back From The Brink and Used Unique Partnerships to Build a Booming Business

info@mission.org (Mission) — Tue, 26 Jan 2021 08:00:00 +0000

Let’s get this out of the way now: most companies will not have someone go from intern to CEO in a matter of months. That’s a situation unique to James Standley and Solé Bicycles. What isn’t out of the ordinary, though, are the many challenges and hurdles that James and his team had to deal with when scaling Solé into the success it is today.

On this episode of Up Next in Commerce, James takes us through the trials and tribulations of the Solé journey, including various shipping and manufacturing disasters and lawsuits that nearly bankrupted the company, and he explains how he worked his way out of those troubles and what he learned along the way. Plus, he gives some secrets on what’s working well for Solé now, such as the strategy of finding different touchpoints to reach customers in a way that has absolutely nothing to do with selling to them.

Main Takeaways:

Starts With Heart: While the relationship with your supplier or manufacturer might seem like a cut-and-dry part of business, it has to go deeper than surface level. f you are working with overseas partners, taking the time to meet, and understand, the people you work with in person and form a relationship with them will carry you further and ease some pain if there are ever problems in the supply chain process.
What You’re Known For: Through unique partnerships and marketing opportunities, there is potential to reach people in different ways, even if that means you’re not necessarily selling them a product with every touchpoint. Having a relationship with customers is more important than selling to them at every opportunity, because if they know you for one thing and then find out you sell something else, they are more likely to buy from you across the board.
Shot on an iPhone: There will always be a place for highly-produced, glossy marketing materials. But, more and more these days UGC and lower-budget content is what is resonating with consumers. As opposed to showing potential buyers something they have to aspire to, like a model, highlighting people and experiences that are familiar to them as they are now will convert better.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone. This is Stephanie Postles and you're listening to Up Next in Commerce. Today on the show, we have James Standley. He's the president and founding partner at Sole bicycles. James, welcome.

James:

Hey, how are you guys doing?

Stephanie:

Doing good. Thanks for joining us.

James:

Yes, I'm super excited to talk about all things ecommerce with you guys.

Stephanie:

Yeah. I was just looking through your website and I am very excited to get a bicycle after this. I didn't even know I needed one, but now I do.

James:

Totally, totally, yeah. We have tons of great bikes and yeah, and tons of cool different colorways and options and a bike for just about anyone's kind of need.

Stephanie:

Awesome. Tell me a bit about how you started Sole. I think it was in college, right?

James:

Yeah. My business partners, that I ended up starting the business with and I, we met back, funny enough, my first venture, which was a music festival I helped start back in college. We were both partners in that.

Stephanie:

It was called the Coachella for the Mountains, right?

James:

Yeah. It was called Snowball, and the idea was Coachella meets on the mountains. Yeah, there was this guy, Chad Donnelley, who I knew through the lacrosse world. I played college lacrosse and he came up with the concept and I was always involved in music. Growing up, I was a concert pianist, and I had DJ'ed in college and been in bands growing up. We met through the lacrosse world, and he came up with this idea. He had reached out to me just to ask my opinion on the project and what I thought about it. At the time, I was a freshman in college and he was asking me about it and I ended up just going back to him and say, "Hey, I want to be a part of this. I think this is amazing."

James:

I was part of that initial team. We kicked off this event with ... Our first, we had Edward Sharpe and the Magnetic Zeros, and Bassnectar, and Pretty Lights, and Diplo and all these amazing artists come out and sold like 15,000 tickets. It was a really cool first venture and a first event. Yeah, so Jake and John, my original founders with Sole, they were partners in it as well, and they helped get some of the money for the project. We met, first year was a huge success and we stayed in contact. At the same time, they were coming up with the idea for Sole, and going back that summer, between my freshman year and my sophomore year of college, they were looking for some additional help on Sole.

James:

I said I'd come in and I've got a more like operational financial sort of background or mind, and they were more of the creatives and the visionary type of people. I came in, helped clean things up. We got the business off the ground. Then going through the summer, they ended up going and raising some money and starting another business, and I ended up taking over the business. I went from being technically an intern in May to the CEO in August. Yeah, so that's how I got involved. Shoot, that was 2011. So, we're going on nine years ago, and I've been CEO ever since.

Stephanie:

Wow. Very cool. That's a wild story. How many bikes were you guys selling when you took over, and where are you at now? So I can get the scale of the company.

James:

Totally, totally. Yeah. Our first year we were featured on this big Forbes article and the business sort of took off, and I think we sold maybe a thousand bikes our first year, which was a lot for a first year business. This past year we're going to sell about 15,000 bikes.

Stephanie:

Wow.

James:

Yeah. We've grown quite a bit.

Stephanie:

That's great. What is the selling point of Sole bikes? How's it different?

James:

Totally, totally. Yeah, for us, our main selling point is you go look at the bike and it's just going to look different than any other bike you've ever seen before. We're really heavy on our marketing and design and colorways and wanted to make something that's really, really simple, easy to use, easy to maintain, but also looks really beautiful, and something that has a personality, and really people can relate to. I think a bicycle, for most companies, is more of a utility product, something that's really spec-driven.

James:

For us, we wanted to make something that people were really, really proud of, and it's like, they can relate to, and find a colorway that really matches their personality, or they could this store music fixed tapes or find these other ways that people can relate to the product. That's really allowed us to set ourselves apart from other bike brands.

Stephanie:

Cool. It seems like pricing is also a big thing. The one thing I've always thought is, why the heck are bikes so expensive? Why? How'd you get your guys cost down so much?

James:

Totally. Totally. Yeah. Yeah. The biggest way we do it is we work directly with a manufacturer and we sell directly to our customers. Just the natural, by cutting out some of the normal distributors or middlemen, we're able to offer what would be a traditionally higher price point products for a lower price and pass those savings onto the consumer by selling direct.

Stephanie:

Tell me a bit more about that, because what did that look like finding a manufacturer? I think I saw you found, in the early days, your manufacturer on Alibaba. Right? Which I was like, oh, that's interesting because I feel like Alibaba ... I've been there before and there's a lot going on. There's a lot of people. It's hard to know who to trust, it's hard to know if they're going to send me something good. How did you guys go about finding a manufacturer there? Did it work out well? Give me some behind the scenes.

James:

Totally. Totally. Yeah. Our first, when we got the business kicked off, we actually were involved in this Ali-Baba business plan competition. Back when we were in college, Jake and John had applied for this business plan competition. They won it and we got a $15,000 grant from Alibaba. That grant or that money paid for them to initially go over, meet our first supplier who Alibaba had helped set up, and we got our first order of bikes in. That's what the initial financing that got the business kicked off. But over time, went through a few different suppliers and really had to iterate our process.

James:

I spent a lot of time over in China meeting with different suppliers, refining the product, getting it to a place where it is today. It took a lot of trips over there and a lot of refining.

Stephanie:

In the early days when you're picking your suppliers and manufacturers, what would you do differently this time around? What lessons did you learn or what things did you maybe stumble on in the early days that you can avoid if you were to redo it now?

James:

Totally. What I would recommend is, we got placed with the supplier via Alibaba, and we just worked with the first person we were placed with. I think we ended up switching a few different suppliers over time, but what really ended up getting us with a supplier that we were super happy with is we went over there, and I went to one of the big trade shows, and we ended up visiting another 15 or 20 during this trip I went on about year two or three, and that trip we ended up finding the supplier we worked with, still to this day.

James:

We really got to go out and meet these people and do your diligence and find the supplier that makes the most sense for you, and not just use the first one that you end up getting placed with or you end up meeting with. You got to go over there and develop a relationship with them. I mean, it's so important. They have this saying there. It's first, you drink tea, then you drink Maotai and then talk business. What I mean by that is, they want to meet you, the different suppliers and the different people over there want to meet you. They want to build a personal relationship, and then they want to talk business because it's so important there to have a personal relationship, as well as a business relationship.

James:

If you're going to try to source something from China or overseas, I'd recommend going over there and meeting these people and spending time with them, and learning, meeting them as people, and really developing a relationship, because that's going to help that business relationship over time and make a really, really strong business relationship.

Stephanie:

Yep. If you don't go and meet them and you didn't really do your due diligence, what kind of problems could a new company encounter? Did you encounter any issues in the early days with some of your suppliers that you stopped working with?

James:

Totally, totally. Yeah. The supply chain for a bicycle is pretty complex. For our product alone, there's over 50 parts. Those 50 parts come from 20 different other suppliers, and then those have to come into an assembler, the assembler puts the product together and then it's shipped over. There's a ton of different things that could go wrong. A good example would be we had one of our biggest shipments ever, at the time for the business. We had put in an order for summer, and it was like 2000 units. We had also set up a big sale online with a company called fab.com. At the time, they were having ... I don't know if you remember the company, fab.com, but they were one of the fastest companies to a billion dollar valuation, I think, and people were talking about it as the next Amazon.

James:

It was having this really big moment. We were selling really well on there. We partnered with them and we were like, hey, we're going to bring in a bunch of units. Let's have a really, really big sale. We have this massive sale. We sell like 1,500 to 2,000 units, pre-sell them, and ends up being the biggest sale ever on fab up to that point. So, do the sale, goods come in, and then we ship all the product out. Well, our manufacturer had packaged the bikes slightly incorrect to where ... The crank arm usually woven through the front wheel, which is detached, and then tucked to the side of the bike when it's shipped. They were all packaged slightly off that almost every single bike came with one of the spokes popped off.

James:

You get your brand new bike that you just bought offline, brand new, beautiful bike, you open it up, and one of the spokes popped off, which it's like ... You can't ride it, but it's a small problem, but it's not an easy problem to fix. Oh my gosh, that situation almost bankrupt us. What ended up happening we-

Stephanie:

What did you guys do?

James:

Yeah, we had the product on credit. We had given we had been sold the product on credit, so we went back to the supplier and we were like, hey, this is going to bankrupt us. We got to figure something out, and they refused to take any discount on it. Then, our advisor was like, "Hey, we're going to just hold payment until we get something settled." They ended up serving us a lawsuit. They came to America, served us a lawsuit.

Stephanie:

Oh my gosh.

James:

So we were served, and had to go through this entire ... Mind you, I'm like 21 years old at the time. I'm still in school. We get served a lawsuit. I'm like, oh my gosh, what is going on? So, we had to hire a lawyer who was our body. He was only like 30 and we didn't have a ton of money. We had to put together a case and actually go out and defend ourselves.

Stephanie:

Yeah, did you win?

James:

We go through this, and we hired this lawyer, and he's like, "Look, you guys don't have the money, [inaudible] afford me, so I'm going to teach you how to build this case." I went and actually built this timeline of everything that's happened, and we came up with a case theory and counter sued them. They responded and deposed me. I had to go through this 40 exhibit eight hour deposition. But we held our ground and got through it. After that, it got to the point where it was like, financially it made the most sense to settle and were able to settle for what ended up being about half off of what the original was. Yes.

Stephanie:

That's wild. I'm just imagining being in college, dealing with it. How was that experience being in college? I'm just thinking, all of a sudden, you have this company and you're having to go to China and now you're getting sued. What was the college experience like for you when you were having something very different than probably a lot of your peers go on?

James:

To be honest, it was really exciting. You felt like it was just so cool to be building something and going through this. We were so ignorant, I think, going through a lot of this stuff, which I think ended up actually helping us. It was just very shoot from the hip and like figure it out. Yeah, so many of these different scenarios could have totally bankrupt us or ended us, but I think it builds a lot of character by going through these different situations and surviving it and learning from it and growing from it. Yeah, it was exciting. It was really fun and exciting. The goal was just like, don't go bankrupt, don't die. Keep fighting and figure it out.

Stephanie:

That's good. I like that. I could see it also just making it seem like, well, what else ... Nothing can really scare me. I've gotten sued. I almost went bankrupt. There's nothing too scary out there after that. I think it's a good place to be.

James:

Yeah. I think it's part of building a business. You're going to face adversity and a lot of ... There's a reason nine out of 10 businesses fail. There's so many things that can go wrong with building a business, but you have to learn to embrace those challenges and know that you just got to fight through it. There's not always a way to figure it out, but there's oftentimes, if you keep working at it and keep fighting, you can find ways to get through these things. If you do get through them, these are like business cards, I guess you could say, or things that'll stick with you and you could grow and build on as you continue to build your business.

James:

After going through all this stuff over so many different situations over so many years, we've now learned to embrace the challenge and just know, hey, here there's going to be some new challenge, every year, there's going to be some new thing that's going to ... we're going to get hit with, and you just have to learn to embrace it and take it head on and not let it beat you up.

Stephanie:

Yeah. I love that. You guys seem really good at partnerships. I've seen some of the very well-known companies that you work with, who they get their own custom bikes built, and you've got things with artists going on and music and all that. How do you how do you view that strategy in your playbook to be able to access new customers and new markets, and how do you even develop those partnerships?

James:

Totally, totally. A lot of that was built from, again, when we started the company, we weren't the traditional bike guys. We were coming from the music background and fashion background. A huge art scene. We had all these relationships early on, and just out of pure having those relationships, we intertwined it in business, and you have the fixed tape series, which one of our early employees was a professional DJ, so he's like, "Hey, I got this idea. Let's create an hour long mix to listen to while I'm riding our bike, and we'll go get some other DJ friends to do it." That piece of content. Just that, that we created that and it's been rolling ever since. We just launched the Sofi Tukker one, which was, I think our 76th mix tape.

Stephanie:

That's cool.

James:

Then that artist creates that mix, and some of these DJs are very globally known DJs. We posted on our SoundCloud and they showed on their SoundCloud, and it creates this nice piece of content that people can come back to and find Sole, or find that mix each month. It's funny because we're not ... you wouldn't think of us as a music business or a bike business, but there's people out there in the world that only know us as the fixed tape company. There are people who'll find out, they'll be like, "Oh my gosh, you guys sell bikes. I thought you were just the fixed tape company or something." It's just organic sort of different little marketing tricks that we've, or little tactics we've built over the years.

James:

They just are organic, unique way to reach new customers and relate with our customers. We do the different partnerships. Again, I'll use the Sofi Tukker example. They're a big DJ group. If you don't know them, they're a big DJ group, globally known. I think one other fun facts, I think they have a platinum record in every country in the world except Antarctica. They're pretty big and they're up and coming. They had a song that's called Purple Hat. One of the lines in the song is purple hat cheetah print. We thought, how cool would it be to make a purple hat, their purple cheetah print bike? So, we had connections.

James:

One of their agencies or marketing companies or whatnot. So, we were able to get a pitch in front of them and they were super stoked on it. Yeah, now we're selling purple hat cheetah print bikes. Again, it's a cool way to ... What other bike companies are selling purple cheetah print bikes? It's just a unique way to reach new customers and provide a unique product and put a cool product out in the world that no one else was doing. I think it's just thinking that way with the bike industry has allowed us to build up these partnerships and set ourselves apart from other bike companies.

Stephanie:

Yeah. When you're doing these partnerships, these partners can also sell it on their website. Right? So, it's not all being sourced back to your website as a central hub. You're essentially letting these partners also sell the bikes on their websites as well. Right?

James:

Totally, totally. Yeah. For each partnership's bespoke and different in their own way. Sometimes like, we did a partnership with Wildfox, which is a women's centric fashion brand. We did these like really beautiful floral prints all over a bicycle. They took them in and they sold them through all their retail shops, as well as their partner wholesale shops, as well as their website, and we sold on our website. There's a bunch of different ways we can structure it. But yeah, it's usually just bespoke to whatever that partnership is.

Stephanie:

Well, that's a good segue into, I mean, when you're thinking about, you've got these mixed tapes going out and partnerships that aren't anywhere close to like the biking industry, how are you tracking conversions? Is your goal to try and get people to listen to these mixed tapes and then come back and buy bikes? Or how do you think about what your goals are around these different projects that you're doing?

James:

Totally, totally. With the fixed tapes, I think we're trying to push out a certain amount of content each month and each quarter. Then we go out and we build content calendars around what are different initiatives that we can tap into? I think when we're thinking about content, we like to look and start with email. Email is like one of our highest converting marketing channels. We're constantly filling and adding to our email list, and then from there, we're trying to push out two to three emails a week. We're mapping out our email pushes. We say, what are the different content initiatives that we can tap into? So, we try to do a fixed tape every two months. We try to do artist series every quarter and large-scale partnership once or twice a year.

James:

We map out all these different things we're trying to do, and then we funnel, and then that leads into email. With email, where you can't really just send very bland marketing type style emails every month. You're not going to get good engagement. So, we have to create stuff that's engaging. I think we've just gotten so good at creating this stuff very cost-effectively that it ends up paying for itself through the conversions of email. It's also a great brand building. They're all great brand building initiatives, and they all kind of build on themselves.

James:

If I do a big large-scale partnership with like a Sofi Tukker, that's going to come back and open up new opportunities down the road for other potential brands, or other potential artists. It's sort of all builds on itself as we go bigger and bigger.

Stephanie:

When you're talking about emails really high, when it comes to converting customers, how do you think about creating that engaging content? What pieces of content are working or what emails work best?

James:

I think one of them more interesting fun little emails that we came up with years ago and it's like the easiest thing [inaudible] to create ever, is we do what we call Sole Saturday. Sole Saturday, it's one photo by the Sole team and then three user-generated photos. Every bike we ship out has a little tag on it that says tag at Sole bicycles hashtag, and you use hashtag of the bicycle for a chance to be featured.

James:

Then, what we do is as we're spelling product, customers are going out and taking photos for us, and every Saturday we feature three of our customers. That, again, it's just like ... we're using user generated content and it's creating a nice email that people can go back to and see if they're featured. It's actually very high converting as well.

Stephanie:

That's fine. Do you think having actual customers and photos is where a lot of brands are going to be headed, less about the models and the people who look perfect and more about ... Is this someone who reminds me of myself and I can see myself riding that bicycle, yeah, feeling a better connection with them?

James:

Totally, totally. It's funny you say that. Because even when you look at ... you go to our paid spend or paid marketing, a lot of times the [inaudible] produced sort of content where it's on a really ... Get a really expensive content creator to produce it and it looks very professional, versus like content that's shot on iPhone or content that's just shot with customers' photos. That ends up converting a lot better than the higher produced stuff. I think that's just the people can relate more to it.

Stephanie:

Yeah. I agree. What kind of channels are you putting that content or the more natural looking content that your customers are creating? What channels are you finding are working best right now to convert customers?

James:

We're constantly testing when we're doing Facebook and Instagram ads. I've been serving different type of ads to different audiences on Facebook and Instagram with different types of content, the more professionals type of content versus the more just shot from iPhone vibe. Even like, over the last year, we've had a big uptick on our online business because of COVID, and people being at home and wanting to find a way to get outside and escape from this madness.

James:

One of the craziest things that we found was iPhone ads or the story ads-specific, so had to build just enough format for iPhones were converting at like crazy, crazy higher row ads versus just more static or traditional images or ads on the Facebook or Instagram. That was like a crazy thing we came up on this year.

James:

There's a very beautiful, simple ad where it's just like the bike on the beach and you have the sky in the background and then the sand below it. Then just the brand and a little copy below it. That little ad actually absolutely killed it for us this year.

Stephanie:

That's great. Are you still using, maybe not that ad, but still putting new ads into the story section on iPhones?

James:

Yeah. I recommend any brand out there that's doing ... I mean, I've been learning a lot of this as we go and trying to get better at it, but when you're creating your ads on Facebook and Instagram for when you're setting that ad up, you can actually split it so that it's like, you have this certain photo for the stack set up and then you have a different photo for when it's served on story. My biggest eyesore, or I hate is, when you're on a story and you get an ad, and it's like an ad that's built for the display. So, it has the kind of squared picture and then it has the words under that.

James:

I don't know if you guys have seen that, but it's such an eyesore to me compared to a beautiful ad that's like really built for the stories. Just making sure that you have the ad set, the story specific ads, it'll help your conversion so much. That's helped us a ton.

Stephanie:

Yeah, that's a really good point. What kind of return on spend should a brand expect from the iPhone story ads versus maybe Instagram or Facebook or Tik-Tok.

James:

That's a tough question. I think it's specific to the brand and the product they're selling, and then, even the time of the year. For us right now, our ROAS is way lower than like the middle of summer. It's almost like a 10th of what it was during the summer. That's just because it's seasonality, our product. We saw specific ... static first story during the summer, I think it was converting 3 or 4X of what it was static. But that's specific to us. I think every brand is different, every product's different. But yeah, I think that can give you an idea of the potential.

Stephanie:

Yeah, very cool. Is there any other new marketing channels that you're trying out, that you're like, I'm not sure if this will work, but we are allocating some funds here to try this out?

James:

No, for now we're focusing just on Facebook, Instagram. We're doing Google AdWords and media retargeting. I want to dip my toes in some other things. I want to try the Tik-Tok and I want to try some Pinterest. I've heard about the Tik-Tok, but the tracking is not that great on it. We haven't done anything yet. Also, Tik-Tok's I think for a little bit lower age or younger demographic than what our target audience is, so we haven't tried-

Stephanie:

I don't know. We've had a lot of people on here saying Tik-Tok works well. That originally, it was just the dancing videos and younger people and all that. People are like, it seems like there's still a good arbitrage opportunity on Tik-Tok right now, because the attribution and tracking might be worse, but you still get a lot of the benefit of going onto a new platform before they increase the pricing and actually understand what kind of conversions they're hitting. I don't know, [crosstalk] to check out.

James:

Totally, totally. There we go. That's my takeaway from this. We'll give it a go. We'll give it a go.

Stephanie:

Yeah, give it a whirl and see. When new customers are coming on your website, I want to talk a bit about like, how do you guide them through the funnel? How do you personalize things and show them, not only content, but also maybe a bike that would work for them or that might peak their interest?

James:

Totally. Totally. It's an interesting ... there's a few things we do. We have about our bikes page, where it's like, which Sole are you? That walks them through the different, we have like six different models. You have the single-speed fixed gear, you have the City Bike, you have the Dutch Step through, you have the three speed City Bike, and then you have the Coastal Cruiser. Top Bar and Coastal Cruiser are down and slanting more. We have a page that we'll walk the customers through the difference between all of those and the pros and the cons of each of those. That can explain the style.

James:

Then once you know the style, what we do different than maybe other companies is we actually ... Each product, each colorway has its own product variant versus like, you may go see a single-speed version of one of our competitors and they keep all the colors on one product page. We create the personality and each colorway has its own personality and its own page. It really helps customers, like okay, I like the red bike, and see the lifestyle on it, and just for that red bike. The red bike would be [inaudible] for a walk and it's got its own story, help the customer really fall in love with that product, and tell a story around each of them, versus them all being bundled up on the one page.

Stephanie:

That's great. Very cool. Then, I was seeing a couple of retail stores that you were partnering with, probably pre-COVID, but it seems like there'd be a really good opportunity to have those partners also kind of market and share for you while they're getting in front of their own new customers as well. It seems like they would kind of take on the budget, the marketing budget to then share your brand under their brand, if that makes sense.

James:

Totally, totally, totally. Yeah. We're seeing a big uptick with like these online third party wholesalers and distributors. That's been, for us, I think our product, it's got such a great look and feel to it that it can transcend from, not just traditional sporting goods or traditional bike-centric channels. We can sell on sites like an Urban Outfitters or on Zola, or some of these other more lifestyle driven sites that want a cool lifestyle product in the bike space.

James:

That's one of our big initiatives that we're trying to get on more of these like third-party digital wholesaler channels, because in the last year, what we've seen the biggest takeaway from all this is like, everything is going digital much faster than it was prior to COVID.

Stephanie:

Yep. Are those partners showcasing your brand? Are they more white labeling, like ordering the bikes and then putting under their brand to say, okay, this is an Urban Outfitters bike, or are they actually saying no, this is Sole [crosstalk 00:33:32].

James:

Yeah, we're selling us as Sole. Yeah, we're selling us Sole through these third parties.

Stephanie:

That's good. That's awesome. How are you getting in front of these big partners? Urban Outfitters is huge and super popular. How did you even get in front of them and convince them to partner with you guys to sell your bikes?

James:

Yeah, just cold email them. Right?

Stephanie:

I hear you cold emailing. Tell us your secrets. Come on, James.

James:

Very easy. Yeah, we'll go out there. If we believe our product could fit in someone's store or someone's space, then we'll hit them up. We're very confident in our product and our brand and we'll sell them on it. It works a ton. Then there's other partners that have reached out to us and want us to work with them. I think, a good example we were connecting ... Target reached out to us and we've just recently started selling on Target's website, which I think is ... It's interesting with them. Target's trying to, in each of their product categories, bring a more 21st century brand in. I think like we really fit that really lifestyle driven 21st century brand for a product.

James:

Normally, there's not a lot of brands in the space that have that kind of fit. I think we really fit those as well. That's an exciting one for us. Then, like I said, the Zola. Zola's a massive, or one of the biggest wedding registry sites. We're one of the only bike brands on there as well, and do really, really well on there.

Stephanie:

Ooh, that's a good angle. I wouldn't think to put a bike on a wedding registry website, but that's awesome, because a lot of times it's just the same old, same old. You're like, I don't need more plates, but I can go for a bike. I would put on my registry.

James:

We sell so many likes there. You'd be really, really surprised. It's a great wedding gift. We have a his and hers, so almost every single order that goes there, it's two bikes, obviously.

Stephanie:

Yeah. That's awesome. Really good strategy. How are you keeping up with fulfillment in the backend? Especially when you're integrating all these partners like Target and Urban Outfitters, what happens if target has a big surge and they've got a bunch of traffic come to their website, and all of a sudden, you've got 500 bike orders? How are you guys keeping up behind the scenes to make sure that you don't go out of stock or have issues on the backend?

James:

Totally, totally. This was something that this year that we've invested a lot of time and energy and effort into, is leveraging technology to make sure all of this stuff runs super smooth. We're using a third party warehouse that has their own systems. Then, we have to use an EDI software or partner to connect to a lot of these systems. It's just spending the time, energy and effort to really automate all this stuff and make sure all these systems talk to each other, and there's inventory pushes going out multiple times a day. You put in the front end work to automate all this stuff so that you can avoid those problems.

James:

There's systems that say, hey, there's inventory pushes that happen multiple times a day to all these systems, so if there's a big spike on say Target, that inventory is removed and pushed out to the other channels so that there's no overselling or minimal over selling. That still happens a little bit here and there because the inventory pushes don't go out all the time. It's a couple times a day, but yeah, it's just about leveraging. There's a ton of technology out there, like using the technology to your advantage to automate the stuff.

Stephanie:

What are some big bets that you guys at Sole are making over the next couple of years? Where do you think the bicycle market is headed? What are some things that you're betting on that you're not sure if they're going to pay off or not over the next couple of years?

James:

Yeah, totally. I think it goes back to digital. We're super focused on digital right now and we're super bullish on digital. We're investing in this technology to make sure that we're set up the scale and then we want to continue to expand where we're selling and who we're selling in front of. Then, on top of that, it's continuing to expand how we market our product and where we market our product and the media partners we can use to get in front of these different people. I think the biggest thing ... People having a stay at home as a result of COVID has set all these new habits. I think they say like, it takes three weeks to set a habit, and what? We've all been at home since April.

James:

Everyone's having to shop from shop online and shop at home. Once we come out of COVID, those habits, I don't think are going to go away. For us, we're super bullish on making sure we have a really solid foundation with, not only our website, but the online e-retail partners that we're selling through so that, as we come out of COVID, we continue to have really strong distribution digitally to the future.

Stephanie:

Yep. I could see some of the retail partners leaning on you guys also for maybe advice and best practices. I've seen some of the bigger companies kind of looking at, not that you're a startup, but looking at startups, looking at people who are able to be agile and move quickly, and trying to figure out like, well, what are you guys doing? Tell us what are the best practices right now, because what we've been doing for the past couple of years was just thrown up into the air and we have to rewrite how we do things now. So, do they ever hit you up and be like, "Hey James, how should we set this up? Or how are you guys doing this so we can replicate this?"

James:

Totally. No, no, no. There's always like other people in the industry that we're talking to. There's always people that we ... Whether it's people in the bike industry or other businesses, other friends that have businesses. Again, always happy to talk with them. For us, you say that we aren't a startup, we are a startup. We've been doing this for 10 years, I still feel like it's a startup. Our team's still pretty lean. There's only 10 of us. We're super nimble and able to move quick, which is great and allowed us to pivot and make changes when things like COVID happened, that bigger companies can't do.

James:

Once we find successes, we can double down and grow on those. Yeah, we're staying nimble and going with the flow and learning quick. Yeah.

Stephanie:

That's great. All right, cool. Let's jump over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, James?

James:

I am ready.

Stephanie:

All right.

Stephanie:

What is your favorite business book that you think about or refer back to [crosstalk 00:40:28]?

James:

It's not a business book per se, but it is You Can't Hurt Me by David Goggins.

Stephanie:

Oh, okay. I like that. I actually have not heard of that. I don't think.

James:

The quick hitter on it, it's about overcoming adversity and pushing yourself. I think that's so important in business is understanding that you can overcome adversity and always setting your bar higher and higher. Again, it's not technically a business book, but I think there's ton of good business lessons you can learn from it.

Stephanie:

I like that. That sounds good. I'll have to check it out. If you were to have a podcast, what would it be about, and who is your first guest be?

James:

Oh my gosh. If I were to have a podcast, I would talk about ... Personally, my favorite thing outside of business and bicycles is traveling. I would do a travel blog and my first guess would be, Oh my gosh, I would pick Barack Obama.

Stephanie:

There you go. I'd listen to that. That sounds good. What is the nicest thing anyone's ever done for you?

James:

Oh my gosh. The nicest thing that anyone has ever done for me. The nice thing, oh, this is big.

Stephanie:

Heavy.

James:

My friend, Mario and Ken, in the early days when we started up our USC shop, these guys would come out every year and work for back to school, which is our craziest time of year for that shop. We sell like a thousand bikes in two weeks, and they would come out and stay at my place, crash on my floor and help us every year for the first four years. So, shout out to Mario and Ken.

Stephanie:

Oh, that is really nice. That's a good answer. What trend or tech do you not understand today that you wish you did?

James:

What trend or tech? Tik-Tok.

Stephanie:

There you go.

James:

I don't get it, but I feel like I need to get it.

Stephanie:

Okay. I've had some other people say that as well, so you're in good company. Others don't also do not understand it. All right. Then the last bigger one. What one thing will have the biggest impact on ecommerce in the next year? It can't be COVID because we've had too many people say that.

James:

I think the big thing impact on ecommerce, I think it's going to be shipping. I feel like shipping is going to change drastically over the next one to five years. You have like Amazon starting to do their drones. We're starting to see in LA these little robots that are delivering food. Then, on top of that, FedEx and UPS are just killing everyone with all their fees and their pricing. We've been in peak surge charges since July. I just feel like there's so much potential for disruption there, shipping.

Stephanie:

Yep. Oh, that's a good answer. Yeah, I agree. I see a lot of companies, a couple of them actually are in Canada who are trying to get one and two day shipping. I think a lot of more companies will be leaning into that once they figure out how to make that work, and they also see how reliant they are on the FedExs, the UPSs, and how much it disrupts businesses.

James:

Totally, totally. Please someone come out here, please help us [inaudible 00:43:54], it's so expensive to ship bikes.

Stephanie:

Well, maybe James, that can be your next business. You've done a lot in your day. You might as well just start a shipping company as well.

James:

There we go. There we go.

Stephanie:

All right, James. Well, thanks for coming on the show. Where can people find out more about you and Sole bicycles?

James:

Totally. You can check us out at solebicycles.com, or our Instagram, which we update daily, @solebicycles, and then my personal is @JimmyStans.

Stephanie:

All right. Thanks so much.

James:

Thank you guys so much. Appreciate it.

Don’t Sleep on The Helix Personalization Strategy

info@mission.org (Mission) — Thu, 21 Jan 2021 08:00:00 +0000

There are some big-ticket items that most people have and need, but absolutely hate shopping for. Mattresses fall into that category. In fact, studies have shown that people would rather go to the dentist than buy a new mattress. Helix Sleep is trying to take the pain out of that experience.

Adam Tishman is the co-founder and co-CEO of Helix Sleep, and on this episode of Up Next in Commerce, he explains why his DTC mattress company is different from the rest, and why those differences matter. He explains the reason it was critical to spend time researching, testing, and perfecting a product before bringing it to market and how that upfront effort created priceless brand equity. Adam also dives into personalization, but he takes it beyond the need to simply give customers a personalized experience, and explains why data-collection and a personalization strategy that includes personalized products can help you expand your business more successfully when you are ready.

Main Takeaways:

Slow And Steady: With a physical product that is dependent on reviews, rushing to market could spell disaster. Take the time to do the research, test, iterate, and develop a product that is review-ready before you present it to your customers.
You’re Not Me: With certain products, there is a specific customer set or type of person for whom the product is made. With mattresses, every person has unique needs, so the product has to be personalized as much as possible. Finding the best way to understand your customers’ needs should be a top priority, and through multiple touchpoints and quizzes, you can gather the data necessary to provide the best experience and product.
The Beginning of a Beautiful Friendship: By cultivating data and delivering personalized products and experiences for your customers, you are inherently forming a stronger relationship with them than a typical brand. Not only are you collecting insights that can be used to help you expand into new product lines, you are also creating a network of previous customers who are more likely to trust the brand and try something new.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone. This is Stephanie Postles. Co-founder at mission.org, and your host. Today, we're chatting with Adam Tishman, the co-founder and co-CEO at HelixSleep. Adam, welcome to the show.

Adam:

Hey Stephanie, thanks so much for having me.

Stephanie:

Yeah, I'm excited to have you. so I have never said co-CEO before, which I kind of want to start there. Tell me a bit about being a co-CEO at a company.

Adam:

Yeah, definitely. So we founded the business, myself and two other co-founders, out of business school. And over the sort of evolution of the company and where we've been over the past five years, we actually run it with myself and one of the other co-founders as sort of the two headed dragon as co-CEOs. And then our third founder is our CFO and COO. And it works really well because it allows us to sort of manage different areas of the business at the CEO level and also work really collaboratively together as well.

Stephanie:

Awesome. So you co-founded HelixSleep and that was back in 2015, right?

Adam:

Yeah. So it was founded by myself and, as I said, two other co-founders back in business school, back in 2015. The three of us had moved to a new city to go to school, went through the process of buying a mattress just for ourselves. And it was sort of uniquely terrible in many ways, whether it was really confusing pricing and really expensive pricing in the store, really just bad in-store buying experience. We actually found out later doing research that buying a mattress is actually rated as a worse experience than going to the dentist. And the last thing was, it was just really confusing. If you don't buy mattresses all the time, which no one really does, and it's something that you buy somewhat infrequently, people have a really hard time understanding how to buy it. And so for us, we sort of saw the problem, saw some of the solutions that others in our category were trying to fix this problem, and felt like we could sort of come in and solve it in a much better, more efficient way.

Stephanie:

Got it. So five years ago it feels like so long ago, what was the market like back then? I mean, who were some of the up and coming people and what kind of unique angle did you guys see in the market at that time?

Adam:

Yeah, definitely. So five years ago, I would say the direct to consumer, or just generally buying mattresses online, was pretty nascent. It was predominantly, people were going into stores. There was actually a while where people were buying beds on phones, but we sort of saw the market, which is very consolidated at the traditional brand retail level. So you have sort of Simmon's, Tempur Sealy, Sleep Number, Casper, which is the most well known and largest player of the D to C mattress brands head launched recently and had really done a good job at showing that this was a category that could generate interest online, somewhat of an atypical category with low, as I mentioned, low ecommerce penetration. What we saw as the issues that I mentioned earlier, we felt that Casper and a lot of the other brands that were starting to pop up were sort of maybe filling in one friction, but replacing it with a different friction.

Adam:

So all of us, including Helix, offer products directly to consumers at much better price points, helping out that value chain issue with traditional retailers. Everyone tries to provide a much better buying experience through a really good user experience on the website, 100 night trial, free shipping, et cetera. The issue where we really differentiate at Helix is around the product itself. So what Casper did and what pretty much every other planner space did was said, "It's really challenging to choose a mattress. So we're going to just get rid of choice altogether, and offer one type of mattress for every single person."

Adam:

And what we found doing a whole ton of research and talking to people, and it sort of makes sense that if you think about it implicitly, is that there really is a wide variety of needs and preferences as it relates to your mattress and to the way that you sleep, the same way that we all don't fit in the same clothing. We all don't have the same exercise routine that works best for us, the same diet. Sleep is quite personal.

Adam:

So one of our missions was effectively, could we help customers understand the right products for them through a sleep quiz that asks questions about things that you knew about yourself? So your body type, your height, your weight, do you tend to sleep on your back or your stomach? Do you get hot at night? Do you get cold? Do you have back pain? Do you like a bed a little bit firmer or softer? And then we take that information and effectively translate it into the best mattress for you. So the order of the layers in the mattress, the density of those layers, the types of materials, the density of those materials, are all really important for getting the best night's sleep and effectively that's what we're doing. So we like to think of it as sort of providing a technology enriched solution as a salesperson. So instead of going into the store and sort of hanging out with sales person, we do that online through our quiz.

Stephanie:

Very cool. And yeah, what I love about what I read about you guys was that you did a ton of research. I think I read that you went through 100 plus page PhD dissertations, and you partnered with researchers in Europe to make sure you really understood how to create this algorithm and this quiz. Tell me a bit about your thought process there, because I think that's so different than a lot of D to C companies right now who are just trying to get that quick launch, take advantage of the market, and are just going really quickly instead of taking a step back and doing the research and figuring out how to solve the problem.

Adam:

100%. I think for us, none of the three of us came from a traditional mattress background, right? And so we did what three nerdy guys would do, which is we started to do research. And we actually had this idea and stumbled across a PhD dissertation on sleep ergonomics, which is the study of the sort of spinal alignment of your back while you're sleeping. You hear a lot about spinal alignment and ergonomics and sort of office chairs, but this was really the first PhD dissertation on that, with bodies lying down. And we actually noticed that at the bottom of the PhD dissertation, the head author had left his email address. And so we emailed him.

Adam:

A couple of days later, we got on a Skype call with him. They were located in Europe and then about a week and a half later, we actually flew to Europe and met with them and effectively worked with them to translate their initial science into the crux of our initial algorithm, which over the last five years, we've sort of wholly taken ownership of, and refined quite a lot. And so it was sort of a funny story because it really was, we got on a plane and went to Belgium and had to figure out where we were going and all those types of things. But it was really important because we felt like we had a scientific base for the hypothesis that we were making.

Adam:

I think to your second part of the question, it's really interesting, this tension around, do I want to get to market as quickly as possible, or do we want to take a step back, feel really confident in the research, the development, the product testing? As you mentioned, we went through many, many versions of the mattress, many, many versions of the algorithm on how we matched people. And the approach that we took was that you really only get to come out to the world and present your product once, at least in physical products, that's sort of our belief as differentiated, perhaps, from a more technical product where you can have an MVP. We couldn't really sell a mattress that was only 50% as good as we wanted it to be one day, because we would get terrible product reviews, and we couldn't sort of build brand equity that way. And so we did a lot of work upfront to make sure that the product is where we wanted it to be.

Stephanie:

That's great. I mean, it seems like there's a lot of room to partner with researchers around a bunch of different topics, but what was that partnership like? I mean, when you went over to Belgium and you're essentially building out a model or an algorithm based on this person's research, were they like, "I want a piece of the pie, I want a little equity," or were they ready to give you all the information for free?

Adam:

Yeah, definitely. So we ended up working out a deal with them where effectively, they provided consulting services in exchange for equity in the business. Of course, that could have been consulting services for money. At the time, this was literally very, very early days. It was actually before we started working with them before we had raised our seed round. So there wasn't any money to pay them really. And so we went ahead with an equity relationship, which we felt made sense at the time. We still feel like it makes sense today. We don't really work with them at all and have not for a while, but it was really helpful to sort of supercharge our learning and understanding in terms of the development of the product and the algorithm.

Stephanie:

Very cool. I mean, have you had to iterate the model? Do you see people requesting different sleeping habits or behaviors? Have things changed for the past five years where you've actually had to change the model a couple times?

Adam:

Yeah, a lot actually. It's one of the biggest, from a consumer perspective, our differentiation is about providing personalization and a more custom mattress buying experience, but from a business bottle perspective, our ability to look at our algorithm or our model and effectively improve it is a really big lever to what makes us unique. And so if you think about what we're doing, is we're taking, as I said, information about yourself, matching it to a mattress. And so over the years, we've effectively, having sold hundreds of thousands of beds, we just have a lot more data. So we've been able to improve both the way that we match you, so person A with these attributes, are you getting matched to bed XYZ, and sort of edit, that as well as making physical product improvements to the beds themselves.

Adam:

So a lot of people talk about AB testing and talk about opportunities with using data to improve your product as it relates to your digital product, right? Your onsite conversion or your UX or something like that. We have taken that mentality to the physical product as well. And we've actually been able to reduce our return rate, improve customer satisfaction, improve average order value, all the main metrics associated with product and product satisfaction, by effectively looking at it in that light.

Stephanie:

Got it. And I also it was reading that the return rate, if you overemphasize how you have free returns and the 100 day, night guarantee and all that, if you overdo that, you'll be able to sell a lot more just because people have peace of mind. Even though I think I saw at least, I mean, it was a Casper stat, but it was only 10% of the people or less actually returned their mattress. Do you guys go about that same way of thinking of overemphasize things to make people feel like it's a risk free purchase?

Adam:

Yeah, I think there's two things there. I think that in our category, offering a fairly long return period, it's typically 100 nights, is kind of necessary, because you need to make someone feel confident in purchasing such a large, but really expensive item, right? Average order values in our category are really high. And so people want to feel really confident in the product that they're ordering. And that's why all of these brands are offering free returns, free shipping. In many cases, or in most cases, really generous policies around warranties, et cetera. It's just offering more opportunity to make someone feel comfortable with spending those dollars. So we definitely approach it that way.

Adam:

I wouldn't say that we necessarily overemphasize it. The reality is, most people need around two to four weeks to get used to a new mattress. And then after that, you don't really need another 70 days, but people tend to like that process. And in terms of return rates, you're right that return rates, they're honestly, I mean, Casper's return rate is probably higher than that number you said, but they're not as bad as retail, traditional apparel or something where return rates are 40, 50% or something like that.

Stephanie:

Yep. What happens when a mattress is returned? Where does it go?

Adam:

Yeah, that's a good question. So we do a few things. So when customers want to return a product, first, we work with them to see why, because there are ways we actually can improve the product experience after the fact. So we can send you a topper that adjusts the feel or other things along those lines, but in cases where mattresses need to be returned,, at Helix, at least we actually donate the vast majority of them. So we have a network of donation partners across the country where we will donate them. In some cases, we cannot donate them, either because there's state laws against it, or city laws against it, or if someone's located in a somewhat remote area. And in which case, we work with junk removal partners that end up recycling them. So all of our beds are technically, in the 100 night period, considered lightly used. So they're eligible for donation.

Stephanie:

That's great. So I was reading there's about over 100 companies now that sell mattresses online. How do you show how different your mattresses are and the algorithm that you have going on? How do you showcase that value proposition on your website or your advertising?

Adam:

Yeah, definitely. So it's a good question. And it's funny. That quote comes up a lot, the 100 plus mattress companies. It's one of those weird categories where there is a very long tail of players. So you probably have 10 to 15 players that have reached any semblance of scale, and then 80 that are very, very small. I mean, you would almost consider them, the equivalent would be like a mom and pop shop in retail world. What I will say is that buying a mattress is a long lead process. So when you decide you want to buy a bed, you're typically in market for it for a week, a few weeks, months even.

Adam:

And what that means is that you have many touch points with multiple brands, right? And you can imagine it's like buying a car, it's like buying anything that's expensive. And so across that journey, we feel like we do a really good job of sort of elevating our brand proposition and really personalizing our messaging specifically to consumers in ways that really speak to them so that our differentiation shines. The other thing is that, because of the way that we customize beds, and also that we really spend a lot of time on making sure that the product quality is excellent, is we just win a lot of awards. So we were named GQ's best mattress, Wired best mattress, whole host of others. And then we also get awards for specific affinity groups. So best mattress for back sleepers, best mattress for plus size consumers, or something like that. And we're able to elevate those messages on individual mattresses.

Stephanie:

Got it. Yeah. I saw, I think it was your organic line that won an award. How did you guys think about developing a new product that was organic materials? And also, launching like that, does it make your other products maybe not look as good? Or how did you guys think about that? Will it help or hurt us putting out an organic line? Because when I looked at it and I look at any organic products, it always makes you think, "Oh, well, what's in the other one if this one's made of natural materials and no chemicals?" So how did you guys think about that balance?

Adam:

Yeah, that's a great question. So we actually thought about that question a lot, and where we ended up and it's almost the core strategy of Helix is that throughout the first three and a half years of our business, we were holistically a single D to C brand Helix, right? Started out as just mattresses and then extended into other sleep products, pillows, sheets, box springs, adjustable bases, et cetera. And then about a year and a half ago, we took a step back, saw what we were building, which was this really fast, growing profitable brand, and in a category that we were sort of one of the leaders in, but what we saw under the hood was this really excellent collection of skillsets across our team, across our technology, some in-house built technology, across our supply chain capabilities and relationships. Could we view ourselves less as a single brand and more as a platform on which we could build a portfolio of home good brands?

Adam:

And that is the strategy that we are currently on. And so Helix is our sort of most well-known largest brand, but Birch, which is our organic line, or our organic brand, was launched about a year ago. And it is actually a sort of related, but completely separate brand. So if you were to go to birchliving.com, you would effectively see an entirely organic ecosystem with the goal of really feeling, I mean, truthfully feeling authentic to consumers that care about organic products, that supply chain is 100% sustainable. It's just a much different consumer. And so we want to make sure we talk to that niche consumer in a specific way that is perhaps different than a typical Helix consumer. And we've extended that process out more recently with the launch of All Form, which is our actually our first step out of the bedroom into the living room, which is a modular furniture brand.

Stephanie:

I love that. I mean, that seems so smart because it's different consumers are looking for different things and like you were just mentioning, if you're comparing the two, then you might actually walk away feeling bad if you went with the one that wasn't organic, but when you have it on a completely different site, you're really meeting the needs of the person who's coming there instead of trying to put everything on one site. So I love that.

Adam:

Yeah. I think it's certainly a slightly different strategy, but we just feel like consumers, especially online consumers, want niche experiences and want experiences that really speak to who they are, and their preferences. And we were sort of already doing that on the product side with Helix, but it made sense to do it in this scenario on the brand side with Birch as well.

Stephanie:

Yep. How do you keep track of everything that's happening under the different brands and the different websites? I mean, how do you make sure any learnings that happen at Birch are maybe transferred over to Helix and over to the furniture line? How do you keep it cohesive when you essentially have now three or four different businesses running?

Adam:

Yeah. It's hard for sure. I think we're currently operating under a shared services model, so we don't have a team that just does Helix and a team that just does Birch or a team that just does All Form. We're just not there. The other two brands are just not at that scale yet, but so that makes this actually a little bit easier because you have the same people that work in a functional area,, working across all of the brands, but it's certainly challenging, for sure. And we've been able to take a lot of learnings from Helix specifically, which is an older brand. It just has a lot more data. It has more customers on a daily and monthly basis, and leverage those learnings across the other brands, which it's typically in that direction from a [inaudible 00:22:02].

Stephanie:

Yeah. I mean, there seems like there's a big opportunity to also re-target prior customers because you already know how to talk to them. You've already sold to them before, and then showing them your new furniture line or the pillows or bed frame, even if it's on a different website, you kind of already know how to communicate that to them in a way that has converted in the past.

Adam:

Yeah, absolutely. I mean, I think that's the core business case, right? And from a business perspective, we like that because it allows us to acquire a customer, build a lot of good will with that customer, and then sell them more products, right? Obviously, but from a consumer perspective, we also think it adds a lot of value to the customer journey because customers that are in market for things like mattresses tend to be in market for other home good products. Maybe you're moving, maybe you're renovating, maybe you got married, maybe you had a kid. Something is predicating your reason for being in market. And in many cases, if we can sort of create a lot of good will with you and then offer you more products, it's not just good for our business. It's also good for the customer because it makes shopping easier, right? it makes your purchase cycle and shopping and all of that a lot easier. And so that's what we're starting to do now. And where we're excited to move in the future.

Stephanie:

Okay, cool. So I also saw that you guys, I don't know if you still have showrooms, but you did have some showrooms in New York. And the process was that a customer would come in and they would take the quiz and then they would go to the showroom and maybe hang out for an hour, take a nap, try out the mattress. How has that model changed? And what's going on with maybe not having the ability to bring people into a showroom and try it out?

Adam:

Yeah, definitely. So we had a showroom in New York. It's obviously been closed for the last nine months. It was a really unique experience because it felt extremely personal, because it was really personal. It almost felt more like you were getting a piece of clothing tailored because you would show up, in many cases you would actually make an appointment in advance. We would have your information. We would actually build the bed for you on the spot. You'd be part of that process. And then you could hang out, test it, et cetera. And we tried to make the experience really, really great. It's unfortunate that we've had to close it. We have plans of moving into a more aggressive thoughts around potentially showrooms or retail units going forward.

Stephanie:

And so when thinking about your marketing toolkit, what are some of your favorite channels to get in front of new customers right now?

Adam:

Yeah, so I think that we approach marketing extremely holistically. We have a very, very diversified marketing approach. Part of the reason for that is we think it just mitigates risk. It's very scary when 80% of your marketing budget is in one single channel, especially if one of those channels is a technology marketplace, or if it's Google or Facebook, and all of a sudden the Google algorithm changes, or Facebook gets rid of a targeted audience and that's it. And that actually happened in the home goods category a few years ago on Facebook.

Stephanie:

What did they take away?

Adam:

Yeah, I think it was 2018. They took away, there was a way that Facebook could help identify new movers, and they took that away, and we weren't super hit by it, but I know a lot of home goods brands and a lot of mattress companies, it was overnight, 30% of your ads disappeared, that kind of thing. So we don't do that.

Stephanie:

That's interesting that we're even talking about new movers because I'm in the process of moving right now and thinking about, "Do I just want to buy a new mattress, so when we get there, it's already set up?" Because it's going to take maybe a week or so to get all my stuff there. That's very smart to target people like me.

Adam:

Yeah. And so we try to avoid that just being too aggregated in a single channel. And so we're really diversified. The other thing is we operate almost all of our channels in house. It's just really important to us to be internal and holistic about it. So yeah, I mean in terms of channels that we love, it's nothing crazy. We're obviously across all the digital channels, radio, podcast, direct mail, all of those. I think if there is magic, the magic for us is really around thinking through the customer funnel holistically and making sure we understand and attribute accordingly with a pretty diversified marketing stack.

Stephanie:

Cool. So when thinking about 2021, what kind of trends are you most excited about, or new behaviors that you've seen occurring that you guys are excited about?

Adam:

Yeah. I think there's a lot. I think obviously just in general, COVID has really accelerated ecommerce adoption in atypical categories. And so I think that's pretty exciting to see where that settles once, hopefully, the world gets back to normal. I think a few areas that we're particularly interested in is there's a lot of movement on payment options and better opportunities for people to pay, which is sort of exciting. Another one is really around blending products and services. So sort of offering services and attaching them to products and using those as ways to better convert customers, and the tools available to do that are pretty interesting.

Adam:

Yeah, and then just for us, it's really around continuing to personalize our web experience, provide better customer experience, and those types of things. So I think 2021 is going to be a really interesting year. I think it's actually going to be two distinct years in one, the first half and the second half will be just completely different for a lot of businesses. And I actually would encourage anyone that's thinking about either starting a business or budgeting for a business to think about the world that way, you might actually want to have budgets for a beginning of the year plan and a second half of the year plan, because it's just really hard to know where we'll be. I feel confident in knowing where we'll be for the next three to four months, but after that, it's going to be a completely new experience.

Stephanie:

Yeah. Yeah. I completely agree. So I want to dig a bit more into, you were just mentioning about merging products and services, and I haven't heard anyone talk about that yet. So I want to hear more, what are you thinking around that? What kind of tools are popping up that you have top of mind?

Adam:

Yeah, so I think for us, merging products and services, there's a few forms of it. One, which is at its most face value, it's just offering more services as if they were products. So that would be things like white glove delivery, things like old mattress removal, those types of services, which technically aren't really physical products, but they help convert customers into buying your physical products. Perhaps the more interesting areas as it relates to customer experience, and can you empower your customer experience team to provide service as opposed to just being an answer center? Right?

Adam:

So I think a lot of people view customer experience or customer service as an area where people go and ask questions, but can you be more proactive in providing service, whether that service be design consultation, be helping think through answering questions, or whatever it might be that really activate almost a little bit more a sales channel. I think that that's really interesting as well for us. And then I know a lot of other people are thinking about other types of services they can offer. Obviously, this is just what we're thinking about. But I think that you're going to see a lot more web experiences that are trying to provide a service-like experience to a consumer in addition to a product.

Stephanie:

Got it. Yeah. And it seems like once some of those services start happening, though, a lot of times, they can become commoditized where then the consumer just starts to expect it. I mean, I'm even thinking about contactless delivery and things like that, where it might cost some businesses extra money to be able to do that, or take a mattress away or whatever it may be. But I think eventually it will become standard, and that businesses need to start planning for, what are the consumers looking for now? And what will eventually have to be absorbed into the margin because it's commoditized?

Adam:

Absolutely. Yeah. I mean, I think that if what you're adding is something that can be easily commoditized, it certainly will be. If what you're adding is differentiated, unique, and valuable, then you should be able to charge for that value, right? It's sort of that simple. And so I think the example I use, white glove delivery, that's not unique to us. We're not the only people that can do that obviously.

Adam:

And so offering that, perhaps, could be something that becomes table stakes, or something that consumers come to have a level of expectation, but offering really niche opportunities to engage with someone on our CX team to help you through the buying process, that's not a commodity, right? That's something that you can really get to an amazing place through training and through branding and through just the entirety of your ecosystem, in my opinion. And so I definitely agree that some of these things could be monetized, but if you're doing them right, you should be able to, either, it should show up in your financials somewhere, whether it's you can charge more, your conversion rate is better, et cetera.

Stephanie:

All right. Let's move over to the lightning round, brought to you by Salesforce Commerce Cloud. This is where I'm going to ask a question and you have a minute or less to answer. Are you ready, Adam?

Adam:

I hope so.

Stephanie:

All right. First up, if you had a podcast, what would it be about and who would your first guest be?

Adam:

If I had a podcast, I mean, this is a boring answer right now. It would be on effectively what I was just talking about, which is the future of D to C. And my first guest would probably be Jeff Raider from Harry's.

Stephanie:

Oh, that's a good one. Awesome. What's up next on your Netflix queue?

Adam:

I'm about to finish the last episode of Queen's Gambit and I love it. It's really cool. I like it a lot.

Stephanie:

So good. I like that too, it's awesome. What topic or trend do you not understand today that you wish you did?

Adam:

I dabbled in high-level cryptocurrency a year and a half ago and I just don't understand it at all. So I wish I knew it better because I think there's opportunity there, but I'm not sure I'm the guy that's going to find it.

Stephanie:

What's the nicest thing someone's ever done for you?

Adam:

Wow. The nicest thing someone's ever done for me?

Stephanie:

I get that response a lot. "Whoa, deep."

Adam:

Yeah, I mean that's deep. I don't know. I mean, my wife married me. That was pretty nice. I'm pretty happy about that.

Stephanie:

What a nice lady.

Adam:

I know, right? What a nice... I guess that the nicest thing... I'll just bring it back to Helix. I don't know if that's a boring answer or not, but we had some pretty awesome early advisers that really didn't need to give the time that they gave, and it was just immensely valuable. So I'll go with that.

Stephanie:

That's a good one. All right. And then the last one, what one thing will have the biggest impact on ecommerce in the next year?

Adam:

Well, the real answer is COVID and the vaccine, that is the answer. And I think that anyone that tells you it's not macroeconomic facts is lying. From an internal standpoint, I'll go back to something I said earlier. I think that the movement in payment processing is a pretty big deal and not a lot of people are thinking about it, and I think that's going to be a big deal.

Stephanie:

Yep. Cool. All right, Adam. Well, thanks so much for coming on the show. Where can people find out more about you and Helix?

Adam:

Yeah, definitely. So come check us out. It's HelixSleep.com for Helix. For Birch, it's BirchLiving.com. And for All Form, the modular sofa brand, it's AllForm.com. Yeah. And that's sort of the best place to check us out and learn more.

Stephanie:

Awesome. All right. Well, thanks so much and have a great night.

Adam:

All right. Thank you so much.

The Evolution of Ecommerce with Jon Feldman

info@mission.org (Mission) — Tue, 19 Jan 2021 08:00:00 +0000

Businesses are always looking for the most effective strategies and tactics to create the best customer experience possible, and in the world of ecommerce, that’s getting harder every day. We wanted to dig into some of the trendiest ways ecommerce brands are weaving their way through this maze, so we invited our good friend Jon Feldman on this episode of Up Next in Commerce to show us the way.

As a senior manager of product marketing at Salesforce, and someone who talks to commerce business owners and operators on a daily basis, Jon knows a thing or two about what’s on their minds, the challenges they face, and the questions they are dying to get answers to. He’s also seen first-hand what kinds of major and minor changes ecommerce companies are making that have had the biggest impact. So how are small website tweaks having a ripple effect on call centers? What will happen to the customer journey as commerce moves to the edge? And what kinds of technology and platforms will brands need to lean on to win across a new ecommerce landscape? Find out all of that and more right here.

Main Takeaways:

On The Edge: Commerce has already shifted from retail stores to store-specific websites. Next, we’ll see more of a migration to shopping on the edge, with commerce happening on content websites and away from the traditional retail site. This sets up a question of customer loyalty and trust that brands have to answer and prepare for.
Know Who They Are, Not Where They Shop: As ecommerce becomes more distributed and marketplaces and virtual shopping experiences crop up, brands need to accept that they will have less control over where a customer finds them or how the brand is represented. Instead of trying to funnel people to a specific site, make sure that however a customer ultimately finds you, when they buy your product, the experience with your systems, shipping, customer service and everything else meets their needs.
Opportunities Abroad: The world continues to become more and more interconnected, which also means that the opportunity to spot product trends abroad and introduce them to a “new market” in another country is also shrinking.. Luckily it's easier than ever before to market and ship products around the world, so you are probably only a few backend adjustments away from being able to expand across borders.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie Postles:

Welcome back to Up Next in Commerce, this is your host, Stephanie Postles, co-Founder at Mission.org. Joining us today is Jon Feldman, a senior manager at Salesforce who works on Commerce Cloud. Jon, welcome

Jon:

Stephanie, great to be here. Thanks for having me.

Stephanie Postles:

I'm excited to have you. I think before we start, because we haven't had many Salesforce people in the show, I was hoping you go through your background, what led you to Salesforce, and what you do today.

Jon:

Yeah, absolutely. I started doing internet commerce at ATG back before Oracle bought it in like 1997 in their professional services group. I was at ATG for eight years and I did implementations around the world, honestly. I was in New York for a while, West Coast and East Coast, and that was super awesome. I met a ton of people and learned a lot about how people use commerce systems. After that, I went and did a four-year stint at a consulting company, doing the same thing. I guess, it's not as exciting. And then I went to Restoration Hardware for four years. I was the senior director of IT/ecommerce, which was really rad, until I got laid off, which was a super bummer.

Jon:

And as I was trying to figure out what I was going to do with my career after being laid off. I was like, "I really don't feel like there are a lot of jobs that are senior directors of IT/ecommerce in a lot of places." And so I thought I'd try marketing and I switched over to product marketing. And I've really been enjoying it ever since. I've been at Salesforce for about two years now and talking all about the commerce product. It's a lot of fun, honestly.

Stephanie Postles:

That's great. What does the best day in the office look like to you?

Jon:

Best in the office. It's interesting because we're at a big evolution point for Salesforce marketing, I think, particularly for Commerce Cloud. The company was built around physical events. For Commerce Cloud, we had three big stations every year, we have the National Retail Federation, which is coming up in January, we have Connections in the middle of the year, and we have Dreamforce at the end of the year. And those are our big opportunities to talk to clients. And of course, with the pandemic and travel stopping, those have all gone away, which if you are a company that sells software, that's problematic because you need to be talking to customers to generate leads and keep the machine rolling.

Jon:

And so, because of that, we've been trying a lot of stuff with video, and my job is really around how we talk to customers through video and how we continue to generate a conversation in an audience with potential customers and existing customers when we can't see them in person. And so for me really fun days are days when we're working on new video stuff. I think that at a high level, a lot of the video that's created is repurposed webinar, and it is just like, here's just a bunch of stuff.

Jon:

And for me, the fun stuff is how we can modernize the format and talk to customers in a way that they're like, "Wow, this is actually interesting and engaging," and not like, 45 more minutes on payments. Anyways. So that's what a good day is.

Stephanie Postles:

Awesome. So on the topic of video, a lot of different companies right now are talking about that as well, about what they're leaning into in 2021, they see a lot of opportunities there, not only with YouTube, but also TikToK. What are you guys seeing in that area?

Jon:

Taking a step back, I think that modern video is YouTube. YouTube is the number two search engine on the internet. And so there's a format to YouTube, which is 10 to 15 minutes long, really clear call to action, and then there are like a million genres underneath that. And I think that as we think about it, it's, how do we get into a format that is more fun and interesting and engaging, and that has a clear call to action? Yeah, I think for us, it's really about, how do we modernize the format? How do we engage on video in a way that isn't just a 45-minute program on a topic.

Stephanie Postles:

When you're talking to customers every day, what are some of the trends and themes you're hearing from them right now and maybe how they're thinking about next year?

Jon:

Yeah. In my role, making all these videos, we talk to customers all the time because Salesforce doesn't want to make a video unless there's a customer interview, which I think is really smart because at the end of the day, customer's the one who have the interesting stories. Obviously, a lot of a lot of what we talk about, it's the impact of code and retail sales closing, or things being pushed to digital because if you look at the numbers on their own, they're pretty remarkable. I have access to Salesforce numbers, and its biggest Cyber Week doubled. Some of our biggest customers are seeing 500% of what they did.

Jon:

And that's interesting, but I think that it hides some of the really interesting storylines. I think it's easy to talk about the numbers, but one of those common things we hear from our customers is that COVID has pushed a lot of people online, it's increased the volume of their business, the velocity is much higher, and that in turn has exposed a lot of problems that they've had in their supply chain. And that little things that weren't a big problem had become really problematic as the scale goes up. And that's manifesting in everything from more attention, to deflecting calls from call centers, because we talked to Hibbett Sports and they were getting a ton of questions about the order cancellations.

Jon:

They implemented online order cancellations and it had this huge impact on their call center. Even though obviously you're losing revenue when someone's able to cancel the order, the impact of taking that pressure off the call center was worth it. And that also manifested on the front end where we find that-

Stephanie Postles:

Oh, interesting.

Jon:

The thing which I think is really interesting about those call center things is how there's always just little things that make enormous changes in the volume. I remember Restoration Hardware, one of the big efforts we had was to just put dimensions to the objects on every product display page, because at the time, the biggest three reason for returns at Resto was that stuff wouldn't fit through the door. And we weren't telling anybody how big it was, so you'd show up with this giant couch that was designed for like a palace in France and it wasn't going through a US standard door. Yeah, really interesting stuff along those sides.

Stephanie Postles:

Yep. We had someone previously on who talked about spotting bottlenecks, and it reminds me of that. Maybe people aren't looking at their customer service department or figuring out... There's so many things to look at right now. So many companies are saying their models were breaking and they had to rebuild things from scratch. And I think taking a step back and figuring out what are the biggest bottlenecks, like you guys were doing with your one customer, how they were able to look at their call center, is a great first step. That's interesting adding order cancellations online.

Jon:

To your point, what I think I've seeing through a lot of this is that companies are taking a broader view of what the whole customer experience is and looking for ways to work around some of these bottlenecks. Intuitively, as somebody who's done a lot of these implementations, I think that oftentimes those bottlenecks are in places where systems touch or there are like decision points and financial trees. You don't have to turn the whole thing off, but make changes that make it easier and faster for customer to go through it. It just takes stress out of the whole organization.

Stephanie Postles:

So what other trends are you hearing from your customers right now? And do you think these things are here to stay, or do you think the world's going to pivot back to where it was before and some of these are going to be short-term fixes that maybe aren't needed in a longterm?

Jon:

It's a really interesting question. I was talking to another customer, they were bringing up this really interesting point that, 2021 comps are going to be a really tricky thing to work with because the market was so crazy this year and next year, you're going to have to figure it out. You're going to have to say, "Hey, was the push online to COVID forever or short?" To your point. The other thing about what I think the future is going to hold and where commerce is is that, originally, a lot of commerce happened at a retail building, And that made a lot of sense, you own the customer that were in your store, no distractions, ready to go. And then a lot of stuff moved online and customers gravitated towards your website, where you could still have a very curated experience and it could still be on your terms, make everything happen.

Jon:

I think that as I look forward, we're going to see more shopping on the edge, which is where products are going to be more deeply integrated at the content sites or in marketplaces, or you're going to be finding places to shop which are not the traditional website. And I think to the question, I think that then becomes a really big customer loyalty question of like, if I'm on a content site and I see an ad for Home Depot, do I trust that it's really Home Depot? Do I believe Home Depot is going to fulfill? It brings that whole question of, what is my relationship?" And image of that vendor up And, "Am I going to transact with them outside?"

Jon:

But internally, we think that something like 15% of commerce next year is going to happen at the edge. So I'm really excited to see how that goes.

Stephanie Postles:

That's interesting. So how can a brand prepare for that? Like you said, a lot of these brands right now are thinking about community building and how to build up that loyalty. There's so many new DTC companies popping up, so there's a lot of competitions. They're all trying to figure out how to really get ahead. So how can they prepare for that if you're saying now it might start turning into shopping in other places to where you're not going to see the brand front and center anymore?

Jon:

Totally. And it's interesting because I think a lot of people approach that as a technology problem, like, "We're going to buy a bunch of software and it's all going to be magic." My personal belief is that technology is an enabler, but it doesn't actually solve any problems on its own. And so the specific things that I would, if I was to presume to tell someone what to do with their business, it would be that, "I think you really need to focus on what your customer is and how you can build loyalty and build a customer experience that is so great that they would prefer it." I think that if you look at Amazon, arguably the shopping experience is a disaster, but the fulfillment is so strong that you have trust that if you're able to find whatever it is in that haystack, that it's going to come to you and it's going to look largely like the picture has.

Jon:

I think that if I was thinking about going to DTC and I was thinking about how to do that, it's about really knowing who my customer was, what they liked, and where to meet them. Because I think the relevancy of where your product shows up and how that customer journey ties into your system relationship with that company are going to be the most important things. Because ultimately, we've lost control of the presentation, it's owning the customer and just being wherever they are, because then that's the consistent thing, is you are where they are. Not that you're always on your website.

Stephanie Postles:

That's interesting. When you're thinking about shopping on the edge, is that referring to Amazon or is Amazon excluded and it's more talking about newer marketplaces that are popping up, like the Fairs of the world or Italic or places like that where maybe they're sourcing products, or is it all of it?

Jon:

I would argue that Amazon to some degree is the edge, their marketplace is this... anyone can put stuff in there, so your brand has to compete there against the knockoffs and events, that similar stuff. So I think the edge is marketplaces and a host of other non-traditional stuff. The single sourcing stuff, I'm not as sure about, white labeling stuff I think is slightly different. When we talk about it, we really mean that, hey, your products are just going to be in places that you'd never expected. And I think honestly, we think a lot about content alongside content when we talk about it.

Stephanie Postles:

Yeah. You were just mentioning Amazon and knockoff products, and one interesting thing, which I didn't know, maybe it's because I don't have an ecommerce company at the moment, is that you have to win that Buy Box. Did you know this where you have all these competitors and you actually have to win out the Buy Box and be able to like brand gate your brand to make sure that no one else can show up under there? There's so many things like that I think a new commerce owner would not really know until they start figuring out that people are now showing up under their listing and there's fraudulent people there. It sounds like a lot of times, you find out or see things going wrong until you learn how things actually work.

Jon:

Yeah, totally. I didn't know that, but it doesn't surprise me. Retail has always been monetized. Like if you want a good placement at the grocery store, you're certainly paying for it. None of that stuff happens by accident. No, it doesn't surprise me. I think that it all comes back to the brand management. It speaks to how much of a pain in the butt it is to curate a brand, even if at the edge you still have to be controlling it, you have to be really mindful of what's showing up on your PDP on Amazon and who they're showing next to you. Yeah, it's really tough. I think at the end of the day, the control you have is the loyalty, because that transcends the market that you're in.

Jon:

Because if you're buying like an LED light on Amazon to like do podcasting, you've got 62 million choices, 90%, they're all like the same product with different brand names on it. There's no way to stand out in that marketplace. Even if you have won Buy Box, I think it's loyalty.

Stephanie Postles:

Yep. Are there tools right now... If this is going to be the way of the future, buying on the edge, are there any tools that curate where you can sell things, how things are going, all in one place for a business owner, so if it does start moving to that model and maybe their product is now selling in like 50 different areas... I'm just imagining the chaos of trying to keep track of pricing and orders and even knowing where you're showing up and what's happening there. Do you know of tools for that?

Jon:

Yeah, it's interesting. Certainly, at Salesforce, we have some ideas and tools. We have some aggregation tools that make it really easy to plug your existing Salesforce Commerce Cloud catalog into other places. But I think ultimately, when you think about a commerce solution for a company, it's really a platform. Because what you're describing, it can turn very chaotic. I'm selling on 50 stores and I have 50 skews and they're all going to different order management systems, and that all gets crazy. Personally, I think the architecture to do this is to have all of those places centralized into a central order processing, central order capture, central service thing, so that no matter where it is, even if...

Jon:

I think people go into this thinking that, "My customer is only going to shop from me on one channel," but they may be buying something on eBay and they may be buying something on that content blog. How do you link those two things together? So the architecture I think is always the central order capture and service thing and that you have either APIs or integrations that allow you to then push that content in a way that makes sense onto the places and appears at the edge. But I think that all the capturing transactional stuff, if at all possible, runs through your engine. I mean, obviously the marketplace is going to want to own it, but it's not all marketplaces.

Stephanie Postles:

Yep. We've just finished pulling together a top trends of 2021, and we're talking about platforms, so it's relevant. We've talked to a lot of companies where they've mentioned that they outgrew their platforms. And so one point that we were making in the article was that a lot of companies right now are seeing the ability to scale a lot quicker than maybe prior to 2020, just because so many people were pushed online, new demographics are online. You can grow a lot quicker, at least this year, than maybe prior years. I'm sure you guys see this as well, new customers potentially coming your way.

Stephanie Postles:

How do you know they're ready for Commerce Cloud? What kind of problems are they encountering with their current platforms where you're like, "Oh yeah, you've outgrown it," because I think I've heard this at least 10 times from guests who've come on the show, like, "Well, things just started going wrong and we knew it," but they didn't always have details. It was just like everything was going wrong. So I wanted to hear some from you guys, what are you hearing?

Jon:

Well, let me take off my Commerce Cloud hat, because I think it's an interesting question because I actually think that that's a platform agnostic problem. I'd love to say, "Oh, you solve those problems on Commerce Cloud." I implemented ATG for 15 years, and my belief is that enterprise software is elastic, can do anything. And then it's implemented and then it's like in cement and it's very inflexible for a lot of it. And I think that companies outgrow these when either their original implementations didn't model their business processes completely or didn't anticipate the change that they would have to use.

Jon:

And I think that what happens is that if you're a business person within an organization and you need to like launch Wishlists and you're an IT person who hears this and you're like, "Wishlist, that can take me a full year to do." I think those agenda, those feelings that, "Wow, this platform is fundamentally broken." So don't blame this author, it doesn't really matter. I think it means that you need a new implementation and a new truing of your business processes with your IT processes so that what you're putting onto the internet is once again in sync with what you're doing and what your dreams are.

Jon:

That's what I think when people say they're outgrowing, there's so much friction getting just their basic business processes done that they feel that they need to just throw it out and start over it. And I empathize with that, I think that there are truly some systems regardless of the software where just it's better to start over.

Stephanie Postles:

Yep, that makes sense. Another thing that we talked about in the report was about these demographic changes that are coming and how many more people are online. How are you thinking about that right now with meeting those people? Some of them are brand new with ordering online, they're now getting used to it and they're probably pretty sticky going forward, but how are you guys thinking about these new users online?

Jon:

Yeah, it is a really interesting question. For me, an interesting analogy is fitness. In a previous life, I was also a fitness instructor that had small boutique fitness. And you can arguably do everything you can in a group setting at home. There's really no magic, there's no secret thing except someone's yelling at you and telling you what to do. And you've had all those fitness places closed and now everything's at home and you have this huge proliferation of home fitness stuff, Peloton, Mirror, Apple's coming out with a product, and all that's really rad. But the question is, and I think it's exactly the same with the fitness as it is with ecommerce, how sticky is that really?

Jon:

When the fitness studios open up again, are people going to rush back to them? Is there something inherent about that in-person experience that people are going to go back to no matter what? As I think about that, my conclusion across retail and fitness is the same, which is that some people really miss that in-person component, regardless and are going to do it, and are going to go back. But I think that even with that chunk of people going back, it's not going to be, at least initially, be the same level that it was before, because the internet is the new technology. It's something that in the last 20 years is new, and I think is going to have a longterm impact now that everybody's been forced into it for a broad array of daily services that it's going to be stickier.

Jon:

So I don't think it's going to be quite as crazy. I think the 2021 comps are going to be lower online, but I think it'll still be higher than 2019.

Stephanie Postles:

Yeah, I agree. We just had Stitch Fix on the show, and it was really interesting because they were talking about starting to at least test out or try out GPT-3 and how they're focused on figuring out ways to process the natural language, which is what the technology is for, because a lot of these new users are coming on and they're typing very formally, they want a formal answer. They want to make sure they get a response in the way that they would expect it. And so Stephanie from Stitch Fix was just talking about how she thinks about personalizing the messages and reacting to the user depending on how they're typing in their question, how they're asking for things, to make sure they meet the user where they're at.

Stephanie Postles:

Which I thought was a really interesting take on personalization and a use of GPT-3, which I hadn't really heard of, at least in the world of ecommerce.

Jon:

It is. It's really interesting. And I would suspect that that's different from vendor to vendor that some people... Stitch Fix will probably see some of that more formal stuff as more professional people are trying to put together AI-inspired wardrobes. And other places, I could see... I'm stumbling around trying to say it's interesting, because all of those are technologies that ultimately will replace the interaction that you would have with a human. I worked at Restoration Hardware for a long time, and so this idea of human curation being something that you can't replace with AI, that there's something inherently wonderful and irreplaceable about that, the person who like knows the product line back and forth and is able to work with you to help you identify it.

Jon:

I didn't buy the full Resto thing where it's like... There's no way to do it all in technology, because I don't believe that everybody wants that kind of transaction every time, but in these situations, it's really interesting to see how people are trying to make up for that, that human curation, human taste's thing with AI on scale now. Oh, it's fixed, it's obviously doing great.

Stephanie Postles:

Yeah. To their credit, they always keep a human stylist to finalize things and make sure that they're still choosing things from a human perspective. So they do do that, but I have also seen it go very wrong when most recently I was calling a phone provider that I'm working with for my new internet in Austin, and they have it where they have the little robot pretend typing, it literally sounds like-

Jon:

Ugh, that's horrible.

Stephanie Postles:

I'm like, "What? Don't look try that." I know it's a machine, but when you try and add that extra emphasis to try and improve, I don't even know what they're doing, I'm like, that actually makes it worse, I'd rather you just tell me, "This is a robot. If you don't want to talk to a robot, let me know." Or something.

Jon:

Or you use your experienced people. What are you doing? We know it's a robot.

Stephanie Postles:

You ain't typing, you're not fooling me, and anyone that you do fool, I feel very, very sorry for.

Jon:

Yeah. It's interesting too because it's almost like we're going to address that real person thing by pretending, by trying to... Because I think no one's surprised when they deal with an AI thing, they're not disappointed, so why pretend that there's a person behind it?

Stephanie Postles:

Yeah. That was my biggest learning back in the day at Google was, if you're going to build these new pieces of tech and you're going to start having machines interact with people for, I don't know, restaurant bookings or whatever it may be, be up front with them because people are fine with it if you let them know, but no one is fine with it if they feel tricked. And I feel the same thing now with chat bots and anything that's happening on your website, people are fine if they know it's a bot, but don't try and pretend to be a person for then that person or the customer to revisit and be like, "Hey, I just talked to Sally last time and Sally's here again, and there's Sally again, Sally's just everywhere. Oh wait, I was tricked, it's not really a person."

Stephanie Postles:

That's when I think that you can do things well, or you might get away with it once, but you actually might anger a customer if you trick them.

Jon:

Yeah. Tricking customers never a good look, I don't think. My customer journey steps six is, trick them into thinking they're talking to a person.

Stephanie Postles:

Oh, that's a good quote, tricking the customers never a good strategy.

Jon:

No, it's not. I don't know, I would be very curious to know what the designer's life on that last stage of Stitch Fix is like. Is it that the AI has come up with banana stuff and you got to piece it back together. I think that'd be fascinating to see how much manual adjustment they have to do, because it's, I don't know, I think people are pretty good at feeling out when there isn't a real human behind it.

Stephanie Postles:

Oh yeah, yeah. I think so too. The other thing I wanted to talk about a bit was trends from abroad. So we've had quite a few guests on the show, some of which I think are actually customers that you guys sent us, and they've found different products, maybe in, I don't know, Japan or Thailand or something. And then they either created the product there and brought it back to the US, or they just brought the trend back here and figured out how to make it here. And I wanted to hear, how are you guys thinking about commerce abroad right now? Are you guys looking into that area? Do you even have customers who are overseas? And where do you see the world headed outside of just the US?

Jon:

Yeah, no doubt. There's two things in there, the first one is this idea that you would bring a foreign concept to another country and introduce it as your own product. And certainly, that happens all the time. And the other is, if you are a company working abroad or even in the United States and you want to address a global market to prevent just that happening, how would you do it? I think actually they're really intertwined because we do see a strong trend right now of companies serving a much more global market from their domestic website.

Jon:

20 years ago, you couldn't find a payment processor that would take international cards in the states, you were getting stuff shipped out of the country, there was this forward carriers. All those services to make it easier, though, very expensive to ship out of the United States really weren't there. But now, you can find a product anywhere and it can be sourced from anywhere. I remember that my son had a plushy stuffed animal and he was given us a gift and it came from Japan, and we were terrified that something would happen to it. And so we bought another one from Japan, which is... I think increasingly what we're seeing is that, because of global commerce and because of the increasingly connections to this both payments and fulfillment systems, it's much easier to be fulfilling anywhere in the world.

Jon:

I was talking to Sally Beauty yesterday and they were talking about how, when they launched in Canada and COVID hit, they just fulfilled from all their stores because they didn't have a local DC and they couldn't do the inter-country commerce. It's like really interesting stuff. But I think that thing goes back to that question, I think it's going to be harder for someone to be like, I've seen this amazing concept in the Philippines, so I'm going to bring it back to the states because no one's ever heard of this and do it because I think that it's so much easier for that company in the Philippines to find and sell into a market anywhere now.

Jon:

We've actually talked about it at Salesforce, is that this idea that you really need to be thinking, even if you're not directly selling to a global audience and what's going to happen when someone from Switzerland comes to your B2B side and wants to buy your ball-bearings, how are you going to make that happen? So, yeah, I think it's interconnected in just that way.

Stephanie Postles:

Yeah. That's a really smart take. So basically the opportunity that used to be there where people would go to a country that maybe not everyone in the US has been to and come back and be like, "Look at this amazing thing," I mean, that's what happened with Red Bull. They went overseas, found it, brought the recipe back here and then it became a hit. It's essentially that opportunity is now closing because we are able to shop abroad, there's a lot of great things happening with localization, and the payments automatically switching over to wherever you're entering in from, and fulfillment's becoming easier, so definitely the gap is closing now around that.

Jon:

Oh, absolutely. I nerd out on audio stuff, and I've got this bananas like Mic arm that I bought from Germany. And I got most of them from a local US distributor, but there were some weird parts because of my microphone I needed. And I just went to their site and it's shipped from Germany and they took my American Express and it came in two weeks. There wasn't some weird customs thing and it wasn't this big process, it was just like, oh yeah, here we go. Boom. And it shows up. I think market's everywhere.

Stephanie Postles:

Yeah. That's cool. I do think there's still a big opportunity though to find very overpriced items and just do a D2C method. We just had on Solé Bicycles, and they said that's exactly what they did. And now they're being sold in Urban Outfitters and they have a bunch of other big partners, but their bikes are, I think like $400 and you can customize them. And there's so many spots that I still see at least here in Palo Alto, I see people riding around with these bikes and there's these big, you've probably seen this Jon, big boxes on the front where their kids are all in the front of them.

Jon:

Oh, yeah.

Stephanie Postles:

Three to $4,000, and a lot of people are going to Europe to have to ship them from Europe and then it's even more expensive. And when I see that kind of stuff I'm like, "Oh, there should definitely be an option because this should not be a $4,000 bike to just have a bike with a big wooden box on the front of it."

Stephanie Postles:

When talking about potential opportunities or not, abroad, the one thing that we were focusing on a little bit was looking at the internet penetration. And so right now, a lot of, I mean, this is more of a VC who's looking into this, but she had a really good quote talking about places like Latin America that have a really high GDP per capita, similar to China, but then their internet penetration being only 4%. So how are you thinking about maybe approaching markets like that, where you have really high GDP for the amount of people that are there, they're ready to work, but then their internet penetration is so low, how are you guys thinking about that?

Jon:

It's interesting. And I would get to this, both internet penetration as well as last mile fulfillment. A while ago I did a project on one of the major retailers in South America out of Santiago Chile, and their big problem was actually getting the product to people and actually payments as well for those final mile pieces. Internet penetration is tricky, I don't know, frankly, I'm a little surprised to hear that because I feel with the proliferation of phones, I feel I'm so ubiquitous right now that everybody has some ability to transact on their phones. It could obviously just be my own sitting here in San Francisco bias.

Jon:

I don't know. The only people that have the capital to do that are going to be like Google and Facebook where you would see already moving into those. I don't know. I don't have an answer to that one.

Stephanie Postles:

I think that regulations are definitely something that's tricky in some of those areas, and I just think the payment thing, and I know inflation has been an issue where alternative currencies in some of these countries have been looked into, whether it's Bitcoin or whatever it may be. But I think there's a lot of opportunity there, but a lot of times they didn't get focused on like, can the people keep their money? Is inflation out of control? Can they actually spend it? And there are a lot of issues, but I also think there's a lot of opportunity once you can get past that barrier and figure out how do we get these people online and transacting like the rest of the world.

Jon:

Interesting. Is that a good thing?

Stephanie Postles:

Yeah. The 4% right now, I wouldn't say it's good because it's like... It's maybe good for their local economy because they're only spending very locally apparently, but they're not getting access to the rest of the world, which there's got to be some reason there, I just don't know enough about it and why not. But when I saw that quote, I'm like, yeah, that's a lot of people who could be coming online for the next like five years or so.

Jon:

It's like when a AOL put users on Usenet, I was like, "Man, everyone is AOL."

Stephanie Postles:

What is Usenet? I was on AOL, but I don't know what Usenet is.

Jon:

Back in the day, Usenet was like the original internet forum system, it's where like all.nerd.games and like rec.games.pinball, my favorite one in college, it was where the nerds hung out. And I remember it was this exclusive community of college students and internet nerds, and AOL was going to take all of their unwashed people and bring them onto the Usenet forums, and here we are, internet broken.

Stephanie Postles:

Okay. Now, I know, I learned something very awesome and new today about AOL, brings me back to my days of putting up my away message, BRB, going to eat a sandwich.

Jon:

Yeah. And it's funny because Salesforce just bought Slack, and so now all of us are thrust back into Slack and everyone's like, "How does any of this work?" It's really interesting to feel so old, "What do you do with status?"

Stephanie Postles:

We just had Slack's CTO on, IT Visionaries actually. And it was perfect timing because then I think it was two days later it was like, Salesforce acquired Slack and we're like, "Ha ha, we're right on it." We just had [crosstalk 00:36:50].

Jon:

Step ahead.

Stephanie Postles:

Timing news check.

Jon:

It'd be an interesting acquisition, I think it's going to be really good for the company.

Stephanie Postles:

Do you think you guys will be able to figure out the away messages and how to use it?

Jon:

Well, anything connected to the world's number one CRM is going to have outstanding away messages though.

Stephanie Postles:

That'll be fun. Fun to hear about. The one thing earlier that you mentioned, I think is also an interesting trend was about fulfilling from stores. So we've had a couple of brands come on where they were like, "Well, we didn't do this before, but with COVID and our warehouses maybe getting shut down, and then we had all this inventory sitting in stores, we actually started using them to fulfill the orders. And then we realized that, "Oh, it's more efficient to do that because if someone orders from California and our stores are in Oregon, it's better to ship from Oregon than to ship from our warehouse that was maybe in Virginia or something."

Stephanie Postles:

And so they started using a more localized method and fulfilling it based on where the person was ordering from, which apparently, a lot of them weren't doing before. So do you see this staying around even when retail starts to open up again? Do you see them continuing to use maybe retail to also fulfill orders or maybe reverting back to warehouses or PPLs?

Jon:

Well, I think that fulfilling from stores is for sure in the future, and I think that there are a couple of reasons. One is that warehouse space is just getting so expensive, particularly around in city areas. Amazon just spent $200 million for the old Greyhound lot here in South of San Francisco, it's crazy money. So if you already have a physical presence, I think in my experience, living here in San Francisco, Best Buy is doing unbelievable job of this where when COVID closed their stores, they turned them into distribution centers, and you can do all your buy online, pickup in store. When it reopened, they did the mix thing.

Jon:

I think that people will continue to use those mixed models. And I think that the benefits are actually on both sides, it helps the consumers get stuff faster and frankly allows a wider variety of stuff to be stocked because you can have more stuff in stores than you can in a single warehouse is my belief. But from the company standpoint, you can shift stuff more quickly and you also... My wife just got a job doing this, she works up at Sport Space, which is a small sports retailer here in the Bay Area, and she's doing ecommerce fulfillment from their store.

Jon:

And so they have like 15 stores and they use every one of them as a warehouse, and their volume over the holidays has gone way up, but they've coped with it because they have a zillion DCS. I think the trick to it although, is that really for it to work properly, you need integrated inventory. And that can be really tough depending on your backend systems. But if you can get that, then I think it's a total no-brainer

Stephanie Postles:

Oh, that's smart. We when we were talking to Wellesley, they were saying the same thing about they used to have these stores where, they're B2B, they are plumbing and HVAC and stuff, and so they would have these big stores that you would go and talk to the salesperson and place your order, and you could look around and all this. And she was saying in the future, they're thinking about moving to just, they don't even really need a store. They have this huge warehouse behind the scenes, like a shoppable warehouse and you just come to the curb and continue picking your stuff up.

Stephanie Postles:

They don't really need their store anymore, and that's the way they're thinking about the future could look for a lot of businesses, either shoppable warehouse or just order online, and if you need to come pick it up in person there's a very mini, mini store out front of the warehouse that you can transact there if needed.

Jon:

Absolutely. I think that, certainly, I'm biased here in California and I see what it sees in San Francisco, but certainly the downtown area, the metropolis of San Francisco is still completely shut down, very few people are going to work. And all of that real estate is shut down both in terms of offices and the commercial stuff on the ground that I don't think that there's any reason to think that all that's going to open up exactly the way it was before. I think there's going to be a lot of innovation in the physical retail space, particularly in places that are based on worker and office traffic and not like suburban weekday traffic.

Stephanie Postles:

Yeah. What kind of innovations do you see coming? Because I do think retail will be transforming. A lot of the retail stores, I think, we'll have to have that in-person experience component or event or something to bring the people into the store because they're so used to shopping online at this point, probably it's like, "Well, what reason do I have to actually go to a store and be in-person and talk to someone?" Or whatever it may be. What kind of changes do you see coming for physical retail?

Jon:

Yeah, absolutely. I think that just drawing up on what we've talked about already in this call, I think that you will see a deep emphasis on stores that really are just, or the staffing levels in stores that really are just warehouses. If you are a Costco, you just don't need that many people because the vacuum is the single vacuum and that's what you're going to buy. But for stores, I think that the physical retail transformative places where taste is the big thing, or there are multiple products that are equivalent and you want someone to help you curate, this is my Resto vocabulary.

Jon:

But ultimately, a human just going to actually help you walk out of the store with something that's a better fit for what you want. I think that that's the future because... Where was I? I was in line the other day, and I walked to the place because I just wanted to get this one thing and I'm waiting in line, it's like, there's no advantage to this, to, "I know what I want, I want to get out of here as fast as possible transaction." But in a transaction where I'm like, "Tell me which one of these is the right one?" That's where I think physical retail is going to shine.

Stephanie Postles:

Yeah. I agree. A couple of times I've been in line maybe at, I don't know, a T.J. Maxx, not recently obviously, or something, but I would just give up because I'm like, "This line's too long, I came here for a reason and now I'm in-patient. Goodbye." That's happened multiple times, I'm like, "Why can I not just walk in and walk out with this stuff and just hit my credit card with it or whatever it may be." I know Amazon was experimenting with that, but to me, that's going to be the way the future, because I don't want to wait in another dang line ever again. I'm spoiled.

Jon:

No, absolutely. And I think self-checkouts too. I did the Amazon Go store and I found the whole thing very weird because you're very aware that there's a camera in the shelf and everywhere, they're recording everything, but that was the best ever. But to your point, I think that people get used to a faster transaction that they're not. I totally get, you need full service, but no one has the time to sit and wait, or I guess some people do, but it gets frustrating and it's a bad customer experience.

Stephanie Postles:

Where do you see the world headed for ecommerce? I mean, big picture, any higher-level things that you guys are preparing for that we haven't covered yet? Or why you guys are working on the things you're working on right now?

Jon:

Yeah. I think probably we're working on stuff which will make having a really amazing customer journey easier. I think that you can say broad... I think there's an argument today that commerce tools on their own are commoditized. At the end of the day, you can build whatever you need with any of the major packages from just a pure commerce standpoint. And so I think the question becomes, what are the tools that are going to help you have a complete customer journey because you're going to be losing control of the specific place that you're going to meet your customer, so how do you continue to build journeys that are amazing anywhere? That's really where I think we're going right now.

Stephanie Postles:

What things are you focusing on then? When you say, making sure you have a good customer journey, I think a lot of people say that, but not everyone actually gets, what does it mean to have a good customer experience and journey. So what kind of things are you focused on right now to make sure that happens?

Jon:

Yeah, absolutely. I think it's a fair question. And I think a lot of people are like, headless ecommerce? But that's a technology. I think really what you're looking at are ways that you can 100% of the time know who you're talking to as a company and identify your customer. And specifically what that means to customer journeys is that means that when you start with a marketing campaign, that whatever that messaging and whatever you know about them is then reflected in the commerce campaign, is reflected in the order management, and then all the way through to the service.

Jon:

So a customer experience at that point is actually the experience of the totality of interacting with your brand, of discovering it, transacting with it, and then enjoying the product or whatever is after it. So that's what we mean by the customer journey, the full thing and how you can make that coherent and make sense and not like, "Oh man, well, you're in supports domain. Godspeed, I don't even know what those guys do."

Stephanie Postles:

Yep. I love that, especially knowing who your customer is. We had on Domm from Fast, and that was his biggest thing is even though they're known for that one-click checkout, he's like, "We're actually solving for identity so that you know who someone is and you're not constantly having to ask them to fill in the same details that they filled in 1,000 other times in different places." And once you can figure it out, the identity piece, the customer experience part will be easy to figure out because then you already know who you're talking to, what they're looking for, their payments stuff's all covered, and it becomes very frictionless.

Jon:

Absolutely. Totally. And I think that that's the future. When you want to reorder from someone, you want to do with one click, you don't want to be like, "You guys definitely know my phone number, but here it is again."

Stephanie Postles:

All right, Jon. Well, thank you so much for joining us today, where can people find out more about you and your awesome work?

Jon:

Oh, well Salesforce Commerce Cloud, everything I'm doing is up there. Unfortunately, it's all gated, but check it out. I'll make sure they don't badge you too hard if you do check it out.

Stephanie Postles:

Yep. Hit Jon up if they do, he's your guy.

Jon:

Totally.

Stephanie Postles:

All right. Thanks so much.

Jon:

Thank you. Have a great day.

Making Your Brand, Marketing and Logistics A Bit More Human

info@mission.org (Mission) — Thu, 14 Jan 2021 08:00:00 +0000

After his first trip down the eCommerce road ended in failure, Jay B. Sauceda swore to never again travel down that path. But life has this funny way of coming full circle and turning your failures into successes. Today, Jay is the founder and CEO of Texas Humor, an eCommerce shop so successful that Jay decided to take the leap and also build Sauceda Industries, which helps manage not only Texas Humor logistics, but the logistics of many other D2C companies.

The journey from failure to repeated success was a winding one, and Jay takes us through it all on this episode of Up Next in Commerce. Along the way, he digs into what it takes to build a company from a base of loyal supporters and his advice to marketers, including how to be a trusted friend rather than a bother in a consumer’s life. Plus, he explains why customer expectations around fast shipping don’t always have to apply to the products you offer.

Main Takeaways:

Small Now, Not Forever: Many eCommerce shops rightly want to outsource their logistics to a 3PL, but if your company is too small, many of those companies may not even be open to working with you. This is what Jay experienced in his early eCommerce days, and he has some ideas on how to approach this if you keep hearing “no”.
A Good House Guest: Think of advertising like being a guest in someone’s home. You don’t want to walk in and overwhelm the conversation with talk of yourself. Your content shouldn’t act that way either. Bring something more to the table.
I Want it Now!: Companies with fast shipping — the Amazons of the world — have led to new consumer expectations when it comes to delivery times. That may be true, but this may not be the expectation for every type of transaction. For necessary commodity goods, fast shipping is critical, but for unique items or products that customers are buying from a company they are loyal to, they actually are much more willing to accept a slower delivery timeline as long as there is transparency throughout the process.
The COVID Effect: As the COVID-19 vaccines are approved and shipped, more logistical resources will be deployed to achieve that task. Stephanie thought that this could have a big impact on shipping, but Jay doesn’t necessarily agree. Tune in to hear his take!

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone, and welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder at mission.org. Today, we're chatting with Jay B Sauceda, the CEO of Sauceda Industries. Jay, welcome.

Jay:

Hey, how's it going?

Stephanie:

I'm really excited to have you on. As we mentioned before the show, I'll be moving to your neck of the woods here in a month or so.

Jay:

It's a very popular thing to do these days.

Stephanie:

It is.

Stephanie:

Yeah. I'm excited to get there. So today I want to talk about two things that feel very dispersed. We are talking about Texas Humor and logistics, but I think the best place to start would be your background so then I can guide the listeners through the story in the way that makes the most sense.

Jay:

Yeah. I grew up Southeast of Houston in a blue collar town called La Porte, Texas, which is where there's a lot of the chemical plants refineries that most people can picture with the whole oil production industry of Texas. But the really great thing about La Porte that I loved was, it fostered really any kind of career development and adult development that you might want. So if you wanted to go to high school and upper education or undergrad education wasn't your thing, you could still graduate and go make 70, $80,000 working in the chemical plants close by and really support your family and do a really great thing. If you were a creative kid like I was, the high school there was really fantastic about fostering creativity of young people and developing their careers dependent upon what direction they wanted to go.

Jay:

So it wasn't like one of these small towns that you see in a movie where everybody works at the coal mine and you got generations of people doing the same thing like that. That may be the case for some people, but there was a lot of latitude to figure out what you're going to do and have people who could help you chase some of those dreams. So for me, I was always a creative kid and was really into photography and those types of endeavors. So I was able to exercise and work out those muscles creatively speaking when I was a kid, and then ultimately ended up coming to University of Texas, where originally I thought that I was going to study political science and which I did. But ultimately went down the path of advertising and the creative field.

Jay:

I spent four years at UT and ultimately just realized that doing the law school and the political science thing wasn't really my GM and ended up in advertising and working for a small ad agency here in Austin, which was the beginning of my creative career and ultimately what led to me ending up in e-commerce some years later.

Stephanie:

Okay. Cool. When I was doing a bit of research, I saw that the creative agency or advertising agency was only six people. So you were able to hear about the business deals, learn about the business side of things as long as the creative piece as well?

Jay:

Yeah. It was a great little firm called The Butler Bros. The two principals there, Adam and Marty Butler, both had some really high level well-positioned roles at the big ad agency here in Austin called GSD&M. They had that front row seat to these really large deals that bigger agencies deal with. But eventually went and started their own firm, and yeah, in those first few years there were just a handful of them. So I was able to sit in the room and as this college intern had access to a lot of conversations and things that I don't think that most ad agency interns would typically have access to. As a result, I really think that it propelled my career forward in a way that, when I ended up starting a little design studio with some friends and building out the early years of my career, I felt more prepared to operate ahead of my years because of some of those experiences and the things that you just pick up when you happen to be in the room with the principals of two companies.

Stephanie:

Yep. So where did you jump to next after the advertising company?

Jay:

I had done that for a while and then went freelance after working for them. They gave me some really great advice on the tail end of my career there. I was curious whether they were going to hire me to work for them or not. At the time they were indicating that not likely, that I hadn't really had enough of a specialty up until that point to make it worthwhile for me to be somebody who was there full time. So really great as an intern, but not so much as a full flung employee. So for that reason, their advice was to go out and try to specialize in something which ultimately ended up being photography.

Jay:

So I went and started to focus on photography as a whole and developed a career as a commercial photographer and ultimately did that for about 10 years. But I guess the eventual destination in this story that's worthwhile to your listeners is that, during that period, I started a small ad agency, a little designed firm called Public School with a group of friends. We had this motif that was all based off of the 1960s era of graphic design specifically around school books and textbooks. And so when we started publishing to our blog and publishing about our work, people really gravitated towards the t-shirts and the various pieces of collateral that we had designed for that brand.

Jay:

So we were really excited because we thought, "Well, why don't we capitalize on this and start an online store?" Which we did, and almost immediately had a ton of sales for t-shirts and various items that we were selling, which was massively exciting. But as with most people who sell things online, it's really funny to see, or it's real fun to see that money and those sales come in. It's not a ton of fun to have to deal with getting all those orders out after the fact. And ultimately that's what we ran into. It was a lot of excitement around making the money, but not a lot of excitement around having to deal with shipments. So the work associated with having to get those packages out the door was so time-consuming and unfun that I, after a while shut [inaudible] and then swore off ever getting back in the e-commerce again. So suffice it to say it's a little bit funny to find myself sitting here about 11 or 12 years later, the CEO of a e-commerce logistics brand shipping the number of packages that we are every day.

Stephanie:

That's great. So tell me a bit about, what year was the store live and did you shift right into the logistics business or did that come a bit later?

Jay:

No. I launched our online store in 2013. The social media audience for Texas Humor, I'd developed over a few years before that. Then in 2013, got it off the ground and started trying to get into scale. Initially, we were just shipping the orders out of my home garage, but over time, basically we had decided to try to outsource the work because we had just gotten so sick of dealing with the scale and having a tough time getting out of our own way as business owners. I reached out to some 3PLs and one of the ones here in Austin just had a very snarky and negative approach to telling me that it wasn't really the right time, which ultimately led to us just getting a little bit of a chip on our shoulder about it and decided to just do it ourselves.

Stephanie:

Mm-hmm (affirmative). What kind of pushback were you getting when you were reaching out to these 3PLs other than them saying that you were too small for what they probably wanted to work with?

Jay:

Yeah. Really, that sums it up. It's mostly, "You're too small for this to be worthwhile." And look, I don't have a problem with that. I run an organization that has to say that to people as well. The difference though, is that culturally our approach is to say that it's not a no, it's the not right now. And what we'd rather do is try to be a resource for some of these companies to help them understand what would make them qualify to work with the 3PL and/or make it cost effective for both parties to be in a mutually beneficial relationship. A lot of, I think, small merchants just get in this mindset that their business is worthwhile and they're ready to just offload and go. And in my case, I recognized that we were too small at the time. What I was trying to point out to the guy was that, "We're not big enough to be worthwhile today, but let me sit down and show you the marketing plan and all the things that we're going to do that will make us worthwhile in the near future."

Jay:

And that was just not something he was really willing to listen to. So that was very much an approach that just rubbed me the wrong way and was something that has definitely informed how we coach brands as they come to us and we have to turn them away because of a number of reasons. Sometimes it's just, we're going to be more expensive than it is even worthwhile for you to be working with us. So until you hit a certain level, you can be spending more money than you are making just to facilitate paying us to do the work and that's not a good position to be in for anybody. So let's avoid that and try to find something that's going to be beneficial for everyone. And that might mean not today, but in the near future. So let me help you fast forward by giving you some tips and some other things that can help you get there quicker.

Stephanie:

Yep. That's great. Before we dive too deep into the logistics piece, I was hoping you could touch a bit on Texas Humor so people know how you created Texas Humor, what it turned into and what you were trying to sell to even start talking to a 3PL.

Jay:

Yeah. Over my career, I've done a lot of this kind of audience building with our brand at our old studio. And for me personally, as a photographer, audience building has been a big aspect of what I've always done. And Texas Humor was just this idea that was born out of a discussion with one of the partners in the design studio I was in, in which we were just talking through what different audiences could we build and where could we go with that? And so I started from nothing, started just tweeting about Texas as a whole and that's ultimately really like where we developed the idea. There was no specific e-commerce goal in mind. But once we realized that we had a few million followers and this captive audience that we could do something with, that was the point at which we decided, "Why don't we try to make this into a little bit more of a business?" And ultimately where we got the idea to start texashumor.com.

Jay:

But it wasn't this big strategic thing in which we said, "Hey, we're going to go start this and we're going to build a store and we're going to do X, Y, and Z." It was far more organic than that. But I took the background that I had in marketing and advertising and leveraged that to really scale up what we were doing. Probably much faster than most organizations would, who would be doing something like what we were doing at the time.

Stephanie:

Yep. So how did you develop that audience and get in front of people? I think I see now that you have over 2 million followers on your social channels, and so, how long did it take to get a big enough audience that then you were like, "Oh, maybe we should try and sell something to them as well." And what did that process look like?

Jay:

It was a couple of years before we actually did try to actually sell anything to anybody, because at the time we were just so averse to e-commerce and wanting to develop any inventory position or anything like that. So we didn't come out of the gates thinking like, "Oh yeah, we're going to totally go do this thing and have it be focused on e-com." That was very much later on down the road. The goal that we had initially was to just try to make some form of money. But it by no means was, "Let's try to focus on e-commerce." Originally, it was more so of a content advertising play and that's really what drove it in the early years.

Stephanie:

Yep. Yeah. I saw that you were generating like 40,000 in revenue by the third month of operation with the content piece of it, right?

Stephanie:

What are some tips around building up that audience? What are some tactics and strategies that maybe you even use to this day to build up an audience?

Jay:

I'm a big believer that, I don't remember who told me this. Maybe I made it up, I don't know, but I just see content and advertising as like a guest in people's homes. Most people do not want someone who's going to come over to their house for dinner and just spend the entire time talking about themselves. And so as brands or content generation organizations, if the only thing we're doing is going me, me, me, then of course, people are going to be turned off by it. That's the exact definition of bad advertising. So for us, and for how I thought about building Texas Humor initially, it was really trying to think and put myself in the shoes of the people who were our audience and try to say the things that they had on their mind already.

Jay:

So there's no science to that necessarily, and I think it's why yes, there are probably some, I don't know, formulas for "going viral", but a lot of the things that do ultimately go viral have this weird X factor that people have a hard time wrapping their head around. And in my mind, that X factor is that it comes from the heart and it resonates with people. So if you really wanted to know what is it that we do that's different than everybody else, we're not the only brand or the only feed that talks about taxes, but I do think that we're the only one that tries not to just purely patronize people. And I think that that's really what set us apart early on. We were trying to be unique, we're trying to provide quality and we weren't just doing social media for the sake of doing social media.

Jay:

The store almost felt like a secondary function of the audience that we had built and not the other way around, which is where I think a lot of brands start. They say, "Well, how do we sell to everybody?" And then they think about everything after the fact, and in my mind, that's really the wrong way to approach it.

Stephanie:

Yeah. Yeah. I love the idea of building a community first and just focus on making that great. I know we've had someone from Food52 on the show previously, and they had the same experience where they're like, "We're just here to build a good blog, good content, make sure our community likes what they're getting from us and can also engage with each other. And then it was just obvious to start selling products and giving them what they wanted based on the recipes we were showing and the maybe materials we were using and whatnot."

Jay:

Exactly. Really, the strongest brands are the ones that think about the commerce secondly. It depends upon what it is you're selling. Your brand may be the content, but in our case, it's not. The content is the brand versus the brand being the content, if that makes sense. Really, the difference is we took that tact.

Stephanie:

So let's talk a little bit about the logistics arm of Sauceda Industries. Tell me why did you, or how did you even decide, "We're going to go into fulfillment and logistics?"

Jay:

Mostly for the reason I described earlier. We were already doing it for ourselves and it ultimately just was a way to cover the costs that we had as an organization. Most fulfillment operations are cost centered, not really a revenue driver. So those types of things tend to be an area where you're losing money or you're killing your margin. So we saw it as an opportunity to make some money rather than just have people carrying it as dead weight.

Stephanie:

What kind of mistakes do you see brands making today when they start exploring the path of working with a 3PL?

Jay:

I think most brands just make the assumption that their time is less valuable than they think it is, or the leaders of the brands tend to think that. And so as a result, they don't farm out the things that they should be. Not having accounting firms from outside handle your books, not working with a logistics company to handle fulfillment. There's this idea that most entrepreneurs have that they can do things for cheaper and faster than most people. And that's probably the case, but in terms of opportunity costs, having a CEO of a online brand handle all of the orders simply to save a little bit of money or to not have an invoice to have to pay for that it's like, that's not really the right way to be thinking about it. So we just really try to coach people on opportunity costs and help them understand those types of things.

Stephanie:

Yep. Are there any bets right now that you're making in the world of logistics where it's headed? It seems like consumer preferences and demands are definitely increasing around everyone wants one to two day shipping, Amazon's made everyone expect that now. What kind of things are you guys leaning into or investing in right now to keep up with those trends?

Jay:

Everybody says that, and I actually don't believe that at all. I think that everybody thinks that that's the case because that's, in my opinion, what the major news outlets say are pundits on TV, but I've not found that to be the case. I think if people are buying a toilet paper, yeah, they need that in one to two days. But if they're buying something very specific from your brand, they'll get it when they get it. I actually think that there's more price sensitivity to shipping than most people think. As a result, people know what they're paying for and in the case of Amazon, like sure, if what you sell is available from 75 other people on Amazon, yeah, you better hope that it's prime enabled and it's cheap and all of the above. But if you've built a brand that sells something very specific that only you carry, then if you build the desire, then people, they'll get it when they get it.

Jay:

But it's not this type of thing where just because they can get toilet paper or Mrs. Meyers baths or a kitchen soap in two days means that they need their Texas Humor shirt in two days too. I'm a pretty adamant person when it comes to that case because I get that question a ton and I think a lot of people say that, but no one has actually really proven to me that that's true. Now, if you ask people their preference, they're all going to tell you two days. But I think that we don't deal, or we don't work in this vacuum in which every single store and shopping experience that happens online is compared equally. I think most customers who are shopping online are doing so with it in mind that like, whatever it is that they're buying is unique to that experience.

Jay:

And so, so long as the brand is setting their expectations up front about what the experience is going to be for the customer, I really just don't think it's as much of a challenge as most people think it will be to get the orders out the door whenever they're going to get them out the door.

Stephanie:

Yep. Yeah. I definitely can see that. It definitely depends on what the product is, like you're saying. If it's diapers, yeah, I need that like right now, in an hour. First, because I probably didn't think about it until last minute versus, I just ordered earrings from this one company, Marjorie, I don't know how to say their name, but I don't mind if it comes in a week. That's okay because they're the only ones selling this product that I want and I'm okay with waiting.

Jay:

Correct. Correct. Yeah.

Stephanie:

Yeah. I definitely think there's a lot of room for brands to be more transparent around the shipping though. And I would rather have someone under-promise and over-deliver than tell me something where it might actually get delayed where I'm betting on that.

Jay:

No, and I think that that's absolutely correct. I do believe that there are a lot of brands who do a pretty poor job of being clear about those things. So no, I'm 100% with you on that. But I do think that a lot of people will just make the assumption that everybody's going to care about it more than they actually do. Which is partially why I'm adamant about trying to dispel with that rumor.

Stephanie:

Yeah. Well, you're doing it here. Yeah. The one thing I was just reading about too, was about delays in shipping and how there's going to be a lot of shake ups in that area, especially if the COVID vaccine gets approved. I don't know if you've read about this a bit, but how, if it starts being something that's going to be shipped everywhere, which is what would happen if it's approved, it's going to delay all the postage everywhere. Have you read any bit about this or thought about things like that, that are a little bit less predictable than other things that would maybe delay shipping [crosstalk 00:27:42]?

Jay:

Yeah. I've actually spoken with some people on the inside of FedEx and a few other places. There are two major vaccines that are out right now. There's the one by Pfizer and then there's another one by the other organization, I'm trying to blank on. Both of which require cold storage for the transit. The Pfizer vaccine in particular requires cold chain storage that is very, very specific to medical purposes. And so you're not sticking this on a FedEx truck. This is going on a very, very specific type of vehicle. None of which carry any of your packages from my store to your house. The other-

Stephanie:

The won't be shared, you're saying? Even if there was a cold storage company like a computer company or food, they would never be shared on the same truck anyways, so that it's not like a-

Jay:

Correct.

Stephanie:

... same pie that you're pulling from them then is what you're saying?

Jay:

Correct.

Stephanie:

Okay.

Jay:

It is not a similar supply chain, cold chain storage is wildly different or cold chain transit is wildly different than the type of process that we have in place for your regular parcel. So, yes, I would believe that a massive amount of distribution taking place all of a sudden would certainly strange FedEx as a organization but the van delivering packages to you from Amazon or from myStore, or any of the stores that service us is not the van who is going to be carrying these products to the end locations. Even the other vaccine, although it doesn't require the same -20 Celsius or whatever temperature requirement that the Pfizer one does, it does still require refrigerated storage on its way to the end point.

Jay:

I think it's a lot of people circling the word logistics and saying everything under this is going to be affected, but within logistics, there's so many different styles of shipping or needs around shipping. And for that reason, not everything in a Venn diagram of like who services what, in large part, the cold chain network is not really one that is as easily affected or would affect the networks that you and I typically expect our packages to come through.

Stephanie:

Got it. Okay. Yeah, that's interesting. I didn't read too much into it, but I'm like, "That's a good black swan event to prepare for, for some brands then if they do do the cold chain shipping."

Jay:

If you're buying food subscriptions and things like that from your... Like Blue Apron or one of these, yeah, you're more likely to, but you know what, more of that is actually the result of limited supply of dry ice. And that's the result... I can get into all of that, but the dry ice shortage is a result of less driving, which means lower cost of oil, which means less drilling for oil, which means less petroleum byproducts, which means less carbon dioxide, which ultimately means less frozen carbon dioxide, which is dry ice. So yes, there aren't aspects of the industry that will be affected, but the underwear that you're ordering from Amazon should not be affected by a ramp up in cold chain transit volume overall.

Stephanie:

True, good. I was worried about that. I really need my underwear on time.

Jay:

Yeah. Exactly.

Stephanie:

All right. Cool. The one thing I was thinking about too, when it comes to logistics, if I'm a new brand, and I'm thinking about having a 3PL to work with, what are some things that I need to get in order before going that route? Because I can imagine some companies coming to you with it being chaos behind the scenes, and you're like, "I can't work with you until you at least have this, this and this in order for us to plug and play." How should a brand prepare before even reaching out to 3PLs?

Jay:

I think a lot of brands will never really give things like their skews and the tags that they used and all of that, like a second thought. They're cobbling together a plan, and then you're two or three years in, and you've got a store with three different naming conventions and all that. And clean data is really what makes the world run smoothly in the logistics world. And so if there's not a really strong focus on attention to that, you end up with a pretty significant issue trying to work with the 3PLs, because you have to go back and clean all that up. So most of my suggestion is, look, try to think through that and it's the spring cleaning exercise that I think a lot of brands have or should go through every year looking back and saying, "Are the ways that I structure my data and my reporting the way that will allow me to be really successful at scale?"

Jay:

And if the answer is no to any of that, then go back to the drawing board and try to make sure that you're adjusting for that because it certainly creates a lot of issues as you try to scale your business up.

Stephanie:

Yep. That's a good point. Yeah. We've had a couple people on the show talk about making sure that you plan for your data dictionary and have it cleaned up from the very start, if you can, so that you're not trying to fix everything after the fact.

Jay:

Correct.

Stephanie:

It sounds like you've definitely been on top of the market or trends or even news, just like we mentioned earlier about the vaccine and stuff. What kind of trends or patterns are you excited about right now over the next couple of years?

Jay:

I think just in general, there's more attentiveness to better and more targeted marketing that I think people are going to be excited to interact with. So from a just overall perspective, I get excited by the idea that I'm not going to get emails that are just boring and seem to be broadly targeted to everybody. So I think that as more small brands leverage tools like Klaviyo and Shoelace and things like that, I think that just overall marketing as a competitive sport becomes more fun. And as a consumer, it's a lot more fun to watch.

Stephanie:

Yup. So how are you guys leaning into the targeted marketing a bit more?

Jay:

I think it's exactly what I said. Just mostly trying to think about, we're not just selling to one person sitting on a couch repeated 3000 times over. We're selling to 3000 different people. So I think if most marketers think that their job is done simply because they came up with a campaign, that's a bummer. I think the more work that gets put in to try to wow people so their brand can connect with them directly, the better. And when it comes to email, the way that we do that is through segmentation and we try to look at all the various segments of behaviors that people who might interact with our brand would be members of, and then trying to evolve the creative that we're developing in a way that seems to speak to them directly. So they feel like when they receive something from us, it's not just this blanket email that says, "Come shop at Texas Humor," it's really touching on the size of clothing that they've purchased in the past or the types of content that they're really into, those types of things.

Stephanie:

Got it. Okay. So you're looking at types of content or you're maybe showcasing things based on size. What other kinds of behaviors are you segmenting right now to be able to craft your message differently?

Jay:

The highest or the best way to say it is around recency and frequency. So we look at the various behaviors on a store and try to segment based off of the recency and frequency of them doing whatever that behavior might be. There's a lot more detail than I can probably go into on this show, but I would say that starting with that is a really great way to make sure that you're not just... I think the word email blast or the phrase email blast is a bad phrase because you definitely should not just be blasting people with anything. I think it's really critical that you be more surgical with how you send emails out to your customers. So that way people feel like they're having a conversation with the brands that are emailing them.

Stephanie:

Yep. Yeah. I think it'd be really great if I were to get an email that said, "Hey, Stephanie, we saw you're moving to Austin. Here's a bumper sticker for your drive or something." Being able to find data like that that connects with me in a different way of like, "Oh, wow, that's cool. I didn't think about a bumper sticker," or whatever it may be, but because you know a little bit about me like that, I'm going to come to your website and explore a bit more.

Jay:

Yeah, exactly.

Stephanie:

All right. So let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask a question and you have a minute or less. Are you ready, Jay?

Jay:

Yup.

Stephanie:

All right. What's up next on your reading list?

Jay:

I will say I haven't read much in the last couple of weeks because I've been so focused on getting everything out the door. But I'll probably actually read The Obstacle Is The Way by Ryan Holiday. I read Stillness Is The Key, which was great, but Obstacle Is The Way's one that a lot of people have been telling me I should read.

Stephanie:

Yep. Yeah. I read that. It is good. What is one trend or topic or piece of tech that you don't understand that you wish you did?

Jay:

I wish that I could personally write SQL queries and do more database work and business analysis myself.

Stephanie:

Yep. That is a good skill to have that I still appreciate to this day. I used to work at Fannie Mae and I'd be all up in SQL all the time, and it comes back even till today where I'm like, "Hey, I at least know what that query is looking for."

Jay:

Very good.

Stephanie:

And then the last one, what's up next on your Netflix queue?

Jay:

I'm eagerly awaiting the next season of The Crown. I know it's like two years away or something like that, but I'm absolutely eagerly awaiting that.

Stephanie:

Yeah, same. I'm excited about that. All right, Jay. Well, it's been a pleasure talking to you. Thanks so much for coming on here. Where can people find out more about you and Sauceda Industries?

Jay:

They can find out more about me on my Twitter account, which you can just find my full name, Jay B Sauceda. I'm everywhere on social media on that username. And then obviously our websites, saucedaindustries.com. So if you have any questions about the logistics space and how it relates to e-commerce or you're just curious about tips on how your brand can best work with the 3PL, happy to answer those or connect you with somebody on my team who can. We'd like to be a resource in our community for e-commerce crane owners, because we know that it's a big jungle out there and we have navigated it once or twice. So to the best of our ability, we'd love to help people take the shortcuts when we know where they are.

Stephanie:

Amazing. Thanks so much, Jay, and I'll see you in Austin.

Jay:

Sounds good. Thanks so much.

Customer Acquisition, Seamless Experiences and Scaling with DTC expert Nik Sharma

info@mission.org (Mission) — Tue, 12 Jan 2021 08:00:00 +0000

Brands large and small are all fighting the same battle of customer acquisition. How you reach customers, and how much that effort costs, is in constant flux, which is why Nik Sharma is a big fan of constantly running micro experiments.

Nik is the CEO of Sharma Brands, a company that remains one of the best-kept secrets among the DTC community and which helps brands scale into the tens of millions. On this episode of Up Next in Commerce, Nik takes us behind the scenes of what that scaling process looks like, including his strategies around customer acquisition. Nik explains how important constant testing is, and he shares some micro-experiments he recommends running regularly. Plus, he tells us why reading every review and every comment associated with your brand is the best leaping-off point for your creative process.

Main Takeaways:

Please Rate And Review: Reviews really do matter, and you should look at every single one to have a better understanding of what customers are saying, what they see as the value props and what isn’t working. You can then work backward with that information and create content that matches what your customers want.
Mo Money, Same Problems: Regardless of how big a company gets, the main problem any brand faces is that of customer acquisition. Bigger brands can throw more money toward getting their message to customers, but ultimately it’s about getting the right content to the right people.
The Mom Test: Your website experience needs to be seamless and frictionless that even the most technically challenged, or busy, can make it through without issue. It also needs to deliver the message that you want to send right up front. No one is going to search for the thing you want them to see, so put it front and center.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey, everyone. Welcome back to Up Next In Commerce. This is your host, Stephanie Postles, co-founder at mission.org. Today, we're hanging out with Nik Sharma, the CEO of Sharma Brands. Nik, welcome to the show.

Nik:

Thank you for having me. I'm excited to be here.

Stephanie:

Yeah. Me, too. If we had video on, I would be trying to look at your whiteboard that you had on with probably 1,000 notes on it.

Nik:

All the secrets. It's got all the secrets.

Stephanie:

Yeah. What kind of secrets are on that board? I was really trying to zoom in like what's going on back there?

Nik:

It's got all the goals for the week, starting with nine hours of sleep, all the way to-

Stephanie:

That's a good goal.

Nik:

... how we plan to combat Facebook and Apple's big fight that's going to start January 15th.

Stephanie:

Oh, tell me a little bit about the big fight. I'm obviously not up to date on that. What's going on?

Nik:

Yeah. So basically in the new iOS update, Apple is going to give pretty much everybody multiple opportunities to block tracking. And so it's really going to hurt attribution for a lot of these ad platforms, especially for small business ad platforms like Facebook ads, Snapchat, et cetera. And so we're basically starting to think through how we combat that going into the new year because a lot of the businesses we work with, they're either brands that are just starting. And obviously, those are small businesses, but there's also some mid-sized businesses doing anywhere from 200 to 800 million in revenue, but they're also going to be just as effective. And so we're trying to think through how we go about combating that going into the New Year, basically making sure that there's not a ton of drop-off as it relates to the client.

Stephanie:

Yeah, I didn't realize this was happening so soon. I was paying attention a bit to the taking away cookies and tracking and all that kind of stuff. I didn't realize the iOS update was happening January 15th. So what are you guys thinking? What's your strategy? What are you advising your brands to do? I know I just jumped right into it, but this is really interesting.

Nik:

Yeah. Well, as of right now, it's a little bit up in the air. We have a few ideas going of how to combat it. But to be honest, there's not a ton of information out that we have to work with. We're trying to work with multiple different ad tech partners to understand how they view the impact happening. But at the same time, we're trying to think through how do we basically start creating our first party audience ads much faster than running ads when we need them, so whether that's by creating what I would call a prospecting CRM versus just a customer-centric CRM post-purchase, or trying to think through how do we still drive lower funnel conversion and attribute those sales properly, even though they might not be last click purchases. Yeah, it's a big cluster of unknowns right now.

Stephanie:

Yeah, that's tricky. I also wonder to what extent will a user maybe turn that feature off and then start to realize maybe how helpful that feature was when it comes to showcasing you the information that you want to see, or maybe ads that actually are helpful because I think right now, a lot of times people are like, "Oh, I want privacy and I want this and I want that"? But if you were to turn off a lot of the features that you're talking about, then you wouldn't really get the customized experience that people will do oftentimes appreciate in Google and other places. They wonder what that would look like.

Nik:

Yeah. Most of the people I've talked to have basically said a similar thing that they like the personalization and whatnot that comes with it. But there is definitely a pretty big group of people who would rather prefer that they never get targeted with an ad. Unfortunately, that's the threat to a lot of the small business advertisers out there.

Stephanie:

Yep, interesting. Well, when you guys have a little more insight into that, I'll just bring you back in here, how you guys are approaching it and what happens in January 15th.

Nik:

Yeah, definitely. Definitely.

Stephanie:

Cool. Give me a little background on Sharma Brands. I was seeing that you guys work with a lot of brands, some of which we've actually had on the show before, which is really cool to see. We've had [inaudible] and I think I saw two others. But tell me a bit about what is Sharma Brands and what do you guys do for the brands that you work with?

Nik:

Sharma Brands is like the secret of the internet. We don't really talk about it much publicly. But basically, what we do is we work with brands that are either just launching or have just launched. We either guide them through the launch or we pick them up right after launch. We work with brands that are midsize, brands that are doing really well and ideally want to do better, or we work with brands that are pretty big retail businesses that want to get their ecommerce business set up and on track. And so we come in and handle everything from strategy to execution, to implementation. A lot of it is testing, a lot of it is focused on creative and messaging and offer testing merchandising. We also do everything all the way to producing national TV spots, satellite radio, like basically helping brands venture out from the more traditional just Facebook ads or building a website.

Stephanie:

Got it. What inspired you to create Sharma Brands? I saw you had a lot of roles. You were the head of D2C for a couple of companies. I think you worked at Hint. Is that what led you to creating Sharma Brands, or tell me a little bit about that journey?

Nik:

Yeah. I've always had a knack for wanting to work on multiple brands, which is probably why Sharma Brands works. But separate from that, I don't know if we are even the perfect solution. I don't think we aren't because we don't really do everything. But there's not really a proper growth partner for a lot of these brands. There are media agencies, there's media companies, there are creative agencies, there are product development agencies, but there's really not many when it comes to true growth and helping them in things like scaling, going from 1 million to 10 million or 10 million to 60 million. And so we created this little niche where we help brands do just that. We try to stay on for no longer than six months per project. Our goal is to basically get in and do just an insane amount of testing so that by the time we leave, that brand knows exactly what's going to scale and what's not going to scale.

Stephanie:

Interesting. What kind of testing do you mean? What do you do throughout those six months to figure that out?

Nik:

It can be anything from copy, creative, landing pages, long form content. When I say creative, there's a whole variety of creative. There's the things like... We might test UGC, we might test influencers, we might test studio stuff, we might test just a whole variety of different types of content. We do the same thing when it comes to page experiences, so whether they're landing pages, whether they're listicles, articles, partnerships with companies like Morning Brew.

Nik:

And then of course, the last piece of it is the merchandising, so everything from offers and pricing to products, to what gets people in the door, what's the best product to sell them after that. And subsequent to that, how do we optimize for brands that are high consumption? How do we focus on subscription? How do we keep customer lifetime value high? How do we bring back repeat purchase rate without having to spend money to reacquire that customer? The goal is to figure an overwhelming majority of those types of things out so that by the time we're done, there's a very clear playbook that they can operate on for the next few months or a few years.

Stephanie:

Yep. I'm assuming that when you were working at Hint and other places, you started seeing similar things that were working and weren't working. Can you tell me a bit about what it was like working at those companies, or maybe you started uncovering a few universal truths around D2C?

Nik:

Yeah, working at Hint was great. It was a lot of fun. We grew really fast, which led us to a lot of challenges that we were able to overcome. But it gave me a lot of insight into the challenges that a lot of the brands face. Obviously, I think customer acquisition is one of the biggest things that brands don't necessarily understand or distribution, which is, I think, one thing we're really good at. But then after that, after you get to a point where you're able to acquire 1,000 customers a day sustainably and at reasonable prices, then how do you take those customers and service them further? How do you come up with products that feed those customers after what they've already bought if it's not a high consumption product? How do you think through unique partnerships that attract eyeballs that then give you the opportunity to sell those customers onto your brand? There's so many things. Basically, it all stems down to distribution. Good brands are really good at product and brand building. But then the idea of then getting that in front of other people is where the tough part comes in.

Stephanie:

And so how do you approach customer acquisition now, where maybe it was different than prior to 2020 because it feels like there's so many new companies in the space? Maybe not all of which will be here in a couple of years. There's a lot of companies. I think more businesses launched in 2020 than in 2019 and prior years. So how do you approach trying to compete and get the eyeballs and find new customers for your brands in a pretty competitive market right now?

Nik:

To be honest, we don't really take competitive brands into account. What we try to do is just be really innovative with the way that we message and get in front of people. For example, something as simple as like Judy, which is emergency kit you know, being able to really hone in on understanding whether it be by surveys or by looking at what types of messaging has better click through rates and conversion rates, understanding the types of messaging that people are reacting to, and then going really deep on it, all the way to coming up with funky partnership ideas like putting Poo-Pourri and Judy together because both brands service emergency situations.

Stephanie:

That's a really good partnership.

Nik:

Yeah, no, it's great. It's really just about like how do we stay ahead of competition? Most brands today probably run a very similar playbook of like, "Let's create some... text some images, put some ads up and run them to our homepage." We put that on steroids. We're testing maybe 17 different versions of creative or testing 7 different versions of landing pages or homepages or sites that they're leading to along with 37 different audiences that we're going after to understand which type of messaging converts better with which audiences.

Stephanie:

That's great. So how do you think about creating all those different types of messaging? How do you stay creative? I know when I'm thinking through ad copy, even for our company, once I create one or two or three, then I'm like, "That's all I got. I'm out." How do you guys stay creative and create like, what'd you say, 17 different landing pages? I mean, like a lot.

Nik:

Well, I have a team that's insanely creative, so that helps.

Stephanie:

That's helpful.

Nik:

But outside of that, I think one thing we do, which is honestly something anybody can do, is we try to look at every single review. So if we work with a brand, we try to read every single review and we will literally use a whiteboard and make a tally of the different value props and how many times they're mentioned and then use that to basically work backwards and understand messaging. So things like that to things like looking at comments on ads, to customer service emails and messages, to how are other people tweeting about it, how are other people taking press about a brand and then tweeting about the press or talking about that specific article. So we try to take in a variety of things. And then if all else fails, have a little glass of whiskey and take an approach with some fresh eyes.

Stephanie:

That's good. When it comes to large brands and small brands, we've been going through some of these challenges, but are the challenges the same for both big and small, or do you see completely different challenges depending on the size of the brand?

Nik:

I think that a lot of the challenges on the macro side are the same, but on the micro... On the macro side, for example, customer acquisition, right? A company that's doing 800 million versus a company that's just launched, both are going to be focused on how do we acquire customers smarter, better, faster, cheaper with higher lifetime value? But on the micro side, it's a little different because a company that's doing even 50 million in revenue has a lot more awareness to play off of. They have a lot more scale to go leverage things like partnerships with other brands, they have budgets to go to places like The Skimm and Morning Brew and other places like that versus a company that's just starting.

Nik:

They still have the same problem with customer acquisition, but they need to figure out even if they raised a little bit of money or if they did it, they need to figure out, "Okay, what is the fastest way for us to get 100 customers and then 1,000 customers and then 10,000 customers and then 50,000 customers." And obviously every time you hit that milestone, it gets easier and easier, but it's still the same. That's the challenge of how do you get in front of as many eyeballs as possible and also relevant eyeballs. You don't want to get in front of just eyeballs that are not going to convert for you.

Stephanie:

Yep. Are there any tools that you use to stay on top of maybe trends or what people are searching for, or even staying on top of like different kinds of audiences to reach and how to reach them in new ways, like new things you're doing maybe this year that you weren't utilizing in the past?

Nik:

One thing that we have started doing a lot more this year versus years in the past is really not taking creative too seriously. So, for example, like running memes as ads insanely outperforms things like really beautiful $30,000 photo shoots, or the way like... Do you use TikTok?

Stephanie:

Yes, I do. I love TikTok.

Nik:

I'm addicted to TikTok.

Nik:

With TikTok, I think if you look at the way TikTok has impacted culture or pop culture, I should say this year, it's pretty fascinating. Like when Instagram was big and there were Instagram models or even you could even say like... yeah, you could probably say even like big YouTubers, they don't really make news or make headlines, nor do they get, for example, flown out to fashion shows internationally to come walk in a runway. But TikTok has just completely taken 2020. And whether it's like TikTok is being flown out to Rome for fashion week or it's the fact that all of Snapchat discovers tabloid garbage is all influencers, there's something about TikTok that resonates really well with the masses.

Nik:

And so one thing we've been doing is testing, not only just testing TikTok's style videos, but also even the way... If you look in the comments of TikTok, I think the comment section is where the memes of tomorrow, or the memes of next month live. And so we've been [crosstalk] doing a lot of things where we test those. Those have been having really interesting results too. Just really like, again-

Stephanie:

All right, so give me some examples.

Nik:

... just a bunch of testing and fun stuff. My favorite is the... For example, if you were like this podcast is the perfect podcast for ecommerce operators, you would put the word operators in between the sparkles emoji, or just like random silly things that you see on TikTok. Yeah. It's hard to explain, but it just works so well.

Stephanie:

No, yeah, I know what you mean. Yeah. Well, tell me some of the most interesting comments that you've seen on TikTok that you've turned into memes.

Nik:

Well, the sparkles one is probably the easiest. Let's see. Outside of that, the eye mouth eye I think is hilarious. What else? What else? The concept of like it's the blank for me. There's just so many little inside jokes on TikTok that becomes so... Not only relevant on the outside world, but also people see it and they relate to it because they think they're the only ones that know about it because TikTok is such a one-to-one thing, you know?

Stephanie:

Yep, yeah. And then when you were talking about creating TikTok style ads, I'm assuming you're saying that you're creating an ad like you would create a video on TikTok and then you're actually putting it on other channels and platforms. Is that what you meant by that?

Nik:

Yeah.

Stephanie:

Yep. I was just thinking about that actually a couple of days ago. My head of growth is like, "Oh, can you create some audio ads and video ads and all this to help promote the shows or whatever?" And I was like, "Well, what's the easiest way for me to do that?" Honestly, creating it on TikTok, even if it's an unlisted video-

Nik:

Oh, 100%.

Stephanie:

Yeah, so much easier than trying to do anything else.

Nik:

The best ads in ecommerce are ones that do not look like billboards on the street. That's where a lot of brands go wrong is that when it comes to ads, they try to create this unique experience or this look that doesn't resonate with the common person. It's like no wonder they don't work because they look like if you see an ad, there's no chance you're going to sit there and be like, "Oh, an ad, let me watch this whole ad." All your ads have to feel like they're not ads. They have to feel like content that somebody maybe not wants to watch or needs to watch, but something that's intriguing enough where they're going to watch the first little bit, and then it's your job as the brand to hook them to watch the rest of it.

Stephanie:

Yep. Yeah, I love that. The other thing, now that we're talking about influencers and spreading things, I heard that your fridge is famous. You tell me a bit more about this because when I heard that, I'm like, "Isn't Nik an influencer? Why is his fridge famous and you're known for your fridge?" So give me the deets on this.

Nik:

Yeah, the fridge racks up impressions. That's for sure.

Stephanie:

Why? What is up with your fridge? Is it a fancy one?

Nik:

I'm just trying to look up real quick how many impressions the last one got. But no, it's funny because obviously I worked at Hint and I've worked with a bunch of different beverage brands. Yeah. So the last tweet about my fridge has 151,000 impressions.

Stephanie:

Why? What'd you say?

Nik:

It's nothing special. It's just the fact that a lot of people know me as a beverage marketer or beverage person. I'm just looking at this tweet from September 14th and my fridge has Taika, has Empathy Wines, it has Jock Coffee, it has Dose, which is like a new wellness shot, it has JuneShine, which is hard kombucha, it's got Sanzo, it's got OLIPOP, Red Bull, Orgain protein elements, which is a adaptogens beverage, and then a bunch of Hint Water.

Stephanie:

Close to D2C fridge. You're stacking it up.

Nik:

It's basically a D2C fridge. Yeah. And then depending on when you open it, you might see different drinks. There's another picture of the fridge I'm looking at. It's all RISE cold brew. It's got Lemon Perfect and it's got Cha Cha Matcha's ice tea lemonades.

Stephanie:

Interesting, interesting. And then so how are people engaging with this? How did it even start of you posted this picture and realizing people like to see what you were trying out, or what you were investing in, or what made them excited?

Nik:

Well, it started because a friend of mine, David Perell, basically posted a picture of my fridge, I want to say when I first moved to New York last year, or I think he might've done it when I lived in San Francisco. But then he posted about it and how like my fridge is basically a vending machine. And then all these beverage companies started responding. And then whenever I tweet about my fridge, I just get a flood of packages over the next 10 days from different beverage brands that want to be included in the next round of the fridge.

Stephanie:

That's really funny. But I also feel like it's helpful to see how to share things that get shared, that go viral because the best way to advise brands and other people is by doing it yourself.

Nik:

100%. That's always been the thesis behind any kind of public account that I have. Whether it's my community number, whether it's my email newsletter, whether it's my Twitter account, everything that I try to do is like, "Okay, I'm basically just testing it so that we can hopefully do this on a brand and it makes a big impact because maybe it's something that they haven't done before or just people in general haven't done before."

Stephanie:

Yep, yeah. That's very, very cool. So when you're working with all these brands, one thing that we've been discussing here at Mission lately is just about all these new users who are now online, a new demographic group is online shopping. They're getting used to it, they're going to be here probably for the long haul now that they have maybe ordered groceries or gone on Amazon for the first time. How are you working with your brands to ensure that their messaging and their interaction and that they may be personalizing things in a way that also connects with this new demographic of shoppers that weren't here prior to 2020?

Nik:

So basically, how should brands prepare for-

Stephanie:

Yeah, having like an older generation now who are ready to shop. And I'm sure the messaging or the way that brands are personalizing is usually towards millennials or 18 to 35 or 18 to 40. Everyone seems to focus on that same two generations, but the older generation are the ones that have the money. They're the ones who are ready to spend. They just haven't brought it really online until recently. But it seems like a lot of things have to change for it to also work well with them.

Nik:

Yeah. I think tactically, there's different things you can do, whether it's the channels that you choose to advertise on. So whether that's shifting budget out of Facebook and onto platforms like TV and satellite radio and connected TV even, or it's... One thing that I've found at a previous brand I worked with was that the creative we would put out that has, let's say, models or talent that looks like they're in their late 20s, early 30s is what resonated best with the audience groups over 45.

Stephanie:

Oh, interesting.

Nik:

So it might just even be something as simple as a shift in your creative to reach [crosstalk 00:27:11].

Stephanie:

Yeah. I wonder why that would be the case.

Nik:

Everybody aspires to be better looking or younger or smoother skin or whatever it may be. And that might be a reason. I think another way though too is thinking through just the ease of how something as simple like your website functions. How easy is it for somebody to come in and shop? I always send landing pages or websites to my mom. She'll look through it and be like, "This is confusing," or she'll be like, "This is perfect. It was one click and I was in the cart." And so we always go for the ladder as the goal. But the other thing too is like... One thing I always say is you got to treat your customers like Kim Kardashian on the red carpet and you're her assistant, right? The brand is the assistant. So you can't expect your customer, you can't expect them to go browse around your site and learn about your brand and learn why they need your brand, or how your brand is going to make their life better, or the deal that they might be able to get, or the coupon.

Nik:

There's so many brands that they clearly offer coupons when you Google, for example, like... I don't know. If you Google like... we'll say Jetblack because they're not a business. If you Google Jetblack coupon, there's probably 17 coupon sites that have a 10% or a 20% off coupon. But what you do is you now create an opportunity for somebody to leave the experience of checking out to go find that coupon. There's a good chance to just get distracted and never come back versus something as simple as like... Basically, what I'm trying to say is you want to create everything or you want to put everything in one simple experience so that somebody who has no time, somebody who has no patience, somebody you could assume they don't have the knowledge of how to navigate a site can basically come to your site and get what they need and they know why they're getting it and just create something really easy to use.

Stephanie:

Yep, yeah. I think frictionless shopping is the way of the future. The one thing about coupons though, I feel like they're just dangerous. Like you said, you leave the site... I know I used to back in the day, go through all these coupon codes and then I'd really get annoyed because none of them are working, all of them were expired. And yeah, it's still feels like there's room even on a website to be like, "You will never find coupons outside of our website. So don't try. Don't go looking around, don't go testing like 1,000 different codes. You'll find nothing. It's only here."

Nik:

Totally. The other thing too is like then you have companies like Honey, the browser extension, which are basically fraud companies, in my opinion, or scammy companies. And if you don't create something of an offer for let's say you run a... let's just say a beverage brand called Three Stars, and somebody comes to the Three Stars' site and they want to buy a variety pack because they're a new customer and they want to try the flavors. When they get to the checkout and they see, "Oh, there is no discount. Oh, but Honey says..." The Honey thing pops up and you click it because you're hopeful that there's a discount. Even if Honey generates no discount, Honey is going to refresh the page and now that becomes a 10% affiliate cut. The brand is paying the Honey without them even realizing it. The customer is not getting any value out of it. But because you didn't create the opportunity for them to check out without having to use Honey, you're now going to end up paying Honey 10% if they have it installed.

Stephanie:

Interesting. I hadn't realized that's how it [crosstalk 00:31:03].

Nik:

Yeah. Honey is a really scammy business. It's really scammy for brands.

Stephanie:

Oh, geez.

Nik:

I hate Honey with a passion.

Stephanie:

Oh my goodness. I actually think we had someone from Honey the long time ago before our commerce show was even live in the world. We had, I think, their COO on one of our other shows, Mission Daily. So if anyone's interested, go check out [inaudible 00:31:24].

Nik:

Yeah. It's a genius business model for them. Basically without showing the customer or without really showing the brand, they're just ripping 10% off of every purchase. And if you're selling like a $400 emergency kit, that's 40 bucks that they're making for everybody who just has an extension installed, but it's-

Stephanie:

And the brands can't control that, or they can't say-

Nik:

No, they can now. When I saw it, I went to them and said, "You guys, you're basically just taking credit for everything you're not driving." And they're like, "Oh, well, it's just the way that Honey works. We drive a lot of traffic." And I'm like, "No, you don't." So then we just shut them off. They just don't get paid now, even though they can still be used.

Stephanie:

Oh, interesting. So when thinking about outside of coupons, but more ways to connect with different users, what do you think about catalogs? Because we had a good discussion, I think, many episodes ago with one of the execs at Marine Layer, and she was talking about how great catalogs work for them. I haven't heard many people talk about it. So it seems like there's still an opportunity there though with so many people now working from home. I know I get excited about mail that's actually fun to look at and helpful. So how do you advise your brands on connecting with an audience through catalogs or paper mail?

Nik:

Personally, I'm a fan. I think it's a sign of luxury when I get a catalog, whether it's from a company like Buck Mason or Todd Snyder or [inaudible 00:33:06], like it's definitely a sign of luxury. The catalogs themselves are printed on very nice and chic paper. I think it just adds to the overall experience of being a customer at those brands. At the same time, if you're a brand that's just starting and you don't have the capital means to do it, I think there's ways you can create digital catalogs for fairly cheap and have them be digital experiences.

Stephanie:

Yep. When you have a catalog, I've heard some brands optimize for experience and fun and more of like a branding play versus others are focused on send them back to the website, get the conversion. How do you think about optimizing a catalog to work well?

Nik:

Well, I think it's two ways. One, you got to feature products that I think people want. So if your spring collection is 250 pieces of clothing or 250 different SKUs, maybe you feature the 27 that people really want. But then secondly, I think from a messaging standpoint, it's got to really make you salivate when you're going through it. That was [crosstalk 00:34:36].

Stephanie:

Like Trader Joe's catalog.

Nik:

Yeah. That was one of my favorite things about... Do you remember SkyMall?

Stephanie:

Yeah, yup.

Nik:

SkyMall just made you want to buy everything in that magazine because everything was like, "Oh, a random flashlight for under my desk chair. Sure. That now seems like something I totally need."

Stephanie:

Yep, yep, I agree. I just saw something in a catalog that I actually ended up buying. It's a... What is it? A candle lighter, but it's not like a big flame thing. It's operated by battery. It has this really long stick on the end and it's intense, it's awesome. Everyone should check it out. We'll link it up in our show notes. But I bought that from a catalog because it was showing it going inside a really deep candle. I was convinced. And it's amazing.

Nik:

Yeah, no, totally. It's all about like building... You want to build a use case for somebody to go tell their friends why they bought what they bought from you. That's like the best way to market.

Stephanie:

I think you also have to have good paper quality though.

Nik:

100%.

Stephanie:

I hate the catalogs that come with just like icky, thin paper, and it's just 1,000 pages and I'm like, "It doesn't feel curated. Just every thing is here. I don't even know how to look through this in a way that makes sense for me," versus the ones that are just 10 pages. It's what you want to look at, or just the best thing that feels like it's personalized, even though it's probably not. I'm okay with that as long as it feels high quality.

Nik:

Totally.

Stephanie:

Let's jump over to a little bit higher level ecommerce question of where do you guys think ecommerce as a whole and D2C is headed over the next couple of years? What are you preparing for right now, or what big thing?

Nik:

Well, I think that ecommerce, as a whole, is going... There's been a ton of innovation this past year and the year prior, both on the side of operations, things like understanding you can't blow cash on acquiring customers, all the way to understanding how to optimize shipping costs or manufacturing costs or even using tools like Settle, which let you basically hack your cash flow. I think, to be honest, over the next year or two, it's just going to be a lot of growth in the category across many different categories that maybe thought they weren't going to be ecommerce. Everything from sitting at a restaurant and now... Obviously, we see QR codes everywhere, at least in major cities, at restaurants for scanning and getting the menu.

Nik:

I think we're going to see that you're going to start paying your bill through Apple Pay after you order your meal, all the way to things like better experiences with packaging and unboxing or just how you learn about a brand for the first time after you buy it. But I think there's also going to be a rise in things like marketplaces. There's a company that I just joined called The Fascination. And basically, the entire idea behind The Fascination is to take a lot of these cream of the crop direct to consumer CPG brands that are independently trying to acquire the same customer and basically put them together, create content around it, and create shoppable content.

Nik:

So, for example, if you have a daughter who's moving to... I don't even know if people are going to be going to college next year. But let's say she's going to college next year, and it's like the ultimate list of things you need for your dorm, it's got your mattress topper, it's got your pillows, your comforter, it's got your desk lamp, it's got organizers. You would be able to basically shop all of this in one page with one checkout through The Fascination. And on the back end, all these brands are getting orders basically pushed into their order queues. The Fascination basically just takes a tiny cut, like an affiliate. But the brands own the customer, they own the relationship with their customers, they have the ability to remarket to those customers. And The Fascination acts as a front of acquiring the customer and now selling maybe eight things at once.

Stephanie:

Oh, that sounds really cool. I think that's much needed with so many new brands popping up right now too. It just feels like sometimes I don't even know who to trust and who's actually got their back end filled out. Is this just the landing page that they're testing out to see if people actually want a product that they haven't even developed yet? So it seems like it's needed to have a trusting source like that to say, "These are some of the best brands and we've verified them and you've got customer service here and we're reputable and blah, blah, blah."

Nik:

Yeah. And that's another thing too is there are a lot of sketchy brands that have launched because the barrier to entry is so low. What The Fascination is trying to do is basically the same way you have like a kosher sticker on food items or a gluten-free sticker that's very universally known. I think they're going to basically try to do the same thing, but for four brands.

Stephanie:

That's awesome. Yeah. I will have to check that company out, maybe bring them on the show. Sounds like [crosstalk 00:42:39].

Nik:

Yeah, yeah. They would be a great one to bring on.

Stephanie:

Yep. The other trend I'm excited to watch this next year is last mile and see how that evolves, especially with the food delivery companies and the DoorDash and Grubhubs of the world starting to actually just work with local retailers to fulfill last mile deliveries. And I think that whole industry is about to have a big evolution. So that'll be an interesting one to watch.

Nik:

Yeah, I couldn't agree more. I mean companies like Ohi or even FastAF, they're doing some pretty awesome things when it comes to last mile delivery.

Stephanie:

Mm-hmm (affirmative). Yep, yeah. I agree. All right. Well, let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Nik?

Nik:

I'm ready.

Stephanie:

All right. What's up next on your reading list?

Nik:

Ooh, I would say the book Supermaker by Jaime Schmidt.

Stephanie:

Oh, that's a good one. Yep, sounds good. What is your favorite business book that you refer back to?

Nik:

Atomic Habits.

Stephanie:

And you're on it. You're like, "Are you top of mind? I got this great." Sounds great. What topic or trend do you not understand today that you wish you did?

Nik:

Bitcoin.

Stephanie:

I've had a couple of people say that. What's the nicest thing anyone's ever done for you.

Nik:

The nicest thing anybody's ever done for me is-

Stephanie:

I had to stump you. You were too on it. You were too lightning.

Nik:

Yeah, that's a good question. Honestly, my favorite is when just people just reach out randomly and say, "Hey, how's your day?"

Stephanie:

You like that? Sometimes I'm like-

Nik:

I love it.

Stephanie:

... "What do you want? Get to the point."

Nik:

Yeah. Well, sometimes you can tell when people have a reason for asking. But when a genuine friend just texts you out of the blue and just says, "Hey, how's your day going?" It's always nice to know.

Stephanie:

Yep, yep. Okay, a friend. I thought you meant just like a random Twitter person.

Nik:

Oh, no, no, no.

Stephanie:

I'll get messages on Twitter like-

Nik:

No, no, no, a good friend.

Stephanie:

... "Hi, how are you?" I'm like, "What? Who are you? Why are you asking me how I am?" That's weird. Ah, 2020. What's up next in your travel destinations when you can travel again? Where do you want to go?

Nik:

I want to go to Jamaica actually with a friend of mine, Chris Hall, and a few of his friends. He's got a pretty good setup there in Jamaica for quick trips out there. So I'm looking forward to hopefully in February maybe go there for a few days and just unplug from work.

Stephanie:

Oh, that sounds fun. Chris, bring me out there as well. That'd be great. What's up next on your Netflix queue?

Nik:

Ooh, actually there was... I forget the name of the comedian, Andrew Schulz maybe. He just launched a stand up. I saw it yesterday and I added it to my list. So that's next up on my queue.

Stephanie:

Oh, that sounds good. I'll have to check it out. If you like it, I'll check it out. What are you most excited about to add to your fridge next?

Nik:

Ooh, that's a good question. There's a beverage that we are launching called Barcode in-

Stephanie:

Barcode.

Nik:

... Q1 next year. It's with the former head trainer of the New York Knicks, who's also a big celebrity trainer, as well as with Kyle Kuzma, who's a championship Lakers player. It's basically a healthier version of Gatorade and it tastes incredible and it's got everything. It's like everything he would prescribe or give to his athletes, but bottled up in one drink.

Stephanie:

Oh, that sounds good because I do like Gatorade. But then when I'm drinking, I'm like, "I know this isn't good for me."

Nik:

It's horrible for you.

Stephanie:

Yeah, it is delightful though.

Nik:

It is.

Stephanie:

All right. And then the last one, if you were to have a podcast, what would it be about and who would your first guest be?

Nik:

I've actually been thinking about this recently. It would probably be about the struggles of commerce that people go through. So it would only be focused on problems people have had in their business, not the successes and not focused on people who've successfully exited. It is strictly focused on people who have, for example, not figured out how something works or how they're going to get through something. I don't know why, but I always keep thinking my first guest is going to be Paul, who's the founder of Prose, which is a haircare brand.

Stephanie:

Okay. I think that sounds great. I love stories like that, where people can actually learn something and because there's so many... Any media article is always like, "Oh, here's the end result. And now, they're a billion dollar company. Oh, and they exited, Oh, they got acquired." It's like, well, what actually happened where they failed because I don't want to fail too and I know they have some kind of knowledge of things that I could avoid, that's why I love biographies and stuff because you can read it and essentially accelerate your knowledge through that person's life and hopefully avoid some of the pitfalls they went through.

Nik:

Totally. And not only that, but also then for all the people listening who might be starting a business, or might be getting themselves into a position where they're not really sure what to do, it almost becomes an encyclopedia where, "Oh, Paul had no clue where to get you pumps at low MOQs for his shampoo bottles. How did he figure out what they were and where he could find them and not get ripped off?"

Stephanie:

Yep, yep, yeah, or I always love the stories when people are going overseas to find manufacturers and hearing things that they encounter. I forget what brand we were talking to on the show where they... I went into one of the warehouses and they were selling apparel and they were like... and all of the employees were smoking and all the stuff smelled like smoke. It's like I would have never realized that unless I actually went over there and was doing an audit before moving forward with one of them.

Nik:

Yeah, totally.

Stephanie:

Very cool. Well, Nik, thanks so much for coming on the show and sharing all your knowledge. Where can people find out more about you and Sharma Brands?

Nik:

The easiest is my website, which is just nsharma.co, or the second easiest which I read every tweet, every message is my Twitter @mrsharma.

Stephanie:

Awesome. Yeah, just go to Nik and say, "Hi, how are you?"

Nik:

Exactly.

Stephanie:

All right. Thanks so much, Nik.

Nik:

Thank you.

From D2C to entering the Shelves of Target and Whole Foods: The Story of BLK & Bold

info@mission.org (Mission) — Thu, 7 Jan 2021 08:00:00 +0000

Access to goods is still an issue for millions of people around the world, but recently, ecommerce has been leveling the playing field. With so many direct-to-consumer operations in business today, the average consumer has more choice and therefore more access than ever before. But there’s one industry that stands out as lagging behind this trend: Coffee. That’s one of the reasons that Pernell Cezar co-founded BLK & Bold Specialty Beverages. Pernell is a long-time coffee lover and saw an opportunity to turn that passion into a business that could also make a big social impact. Historically, coffee has been hyperlocal, but he envisioned a business model that democratized access and brought specialty coffee to everyone. The only problem was that neither Pernell nor his co-founder had any experience in the coffee business other than as consumers.

On this episode of Up Next in Commerce, Pernell reveals how they were able to turn BLK & Bold into a nationally-distributed product, including how they turned a mission-driven ecommerce business into a retail one by securing partnerships with places like Whole Foods and Target. Plus, he explains the importance of giving potential customers multiple ways to find your product, and the value of finding mentors to help you fill in your blindspots.

Main Takeaways:

The Way In: Having multiple ways and messaging for potential customers to find and want to engage with you is a great way to build a base. But when one of those ways is through a social impact mission, you have to also be sure the product quality and experience delivers. Tune in to hear how Pernell thought about striking this balance.
Stick To The Plan: Entering retail can be an exciting milestone for your business, but it’s important not to rush the process. You should have a checklist of things you want/need to accomplish in order to set yourself up for success. Whether it’s with your packaging, other partnership, or logistics, be patient and get them done because a failed retail launch is hard to come back from.
Share With The Class: When you’re just starting out, be open about what you are doing and on the lookout for anyone who might be able to help or mentor you. Small conversations can lead to critical connections that can propel you further than you’d be able to get on your own. You will have blindspots, and addressing them sooner means saving more time and money in the long run.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone, and welcome back. This is Stephanie Postles, and you're listening to Up Next in Commerce. Today on the show we have Pernell Cezar. He's the co-founder and the CEO of BLK & Bold Specialty Beverages. Pernell, welcome.

Pernell:

Thank you for having me.

Stephanie:

I'm excited to have you on the show. I actually just saw some of your coffees in a Whole Foods around here. I was like, "Hey, he's joining us." It was perfect timing.

Pernell:

[crosstalk 00:00:30]. I love it.

Stephanie:

I'd love to hear a little bit about BLK & Bold, what is it? And let's dive right into your founding story because I know you have a good one.

Pernell:

Sure thing. BLK & Bold, we are a coffee roastery out of Des Moines, Iowa, founded about two and a half years ago really from the length of conversations that my childhood best friend, who's actually my co-founder, his name is Rod. I'll likely reference him a few times here. Him and I had just in teenagers, talking about whatever to being professionals and being time strapped and wanting to make sure that we were spending our dollars more consciously to support initiatives that we really felt we didn't have a lot of time to put into like we wanted to.

Pernell:

After so much ideation around our ritualistic beverages and coffee and tea, we really decided to focus on connecting everyday consumers back to their community by way of turning those beverages into vehicles for impact, and in which we launched BLK & Bold with the initiative to tangibly give back to disadvantage youth by way of giving 5% of our profits back to initiatives across the US that service specifically that demographic, but then also making specialty coffee and the delicacy of coffee and tea more accessible in conventional spaces where people shop already and not have it be confined to the independent shops that exist in neighborhoods across the US.

Stephanie:

Very cool. How did you decide to start with coffee? Because I read you didn't really have a background in that, and I was watching your video where you guys were starting it, I think, in your garage and you were trying to figure out what buttons to press and it was really fun just seeing how you really didn't know what you were doing. How did you land on that idea and decide like, this is the one.

Pernell:

Professionally, I didn't come from the coffee industry per se. However, as a consumer, I have user experience as a consumer. And going-

Stephanie:

You're a pro.

Pernell:

Yeah, exactly. Going across that journey, I always call it the coffee spectrum in the sense of what you like and what you don't like. And that's really where the curiosity book hit us where just traveling so much professionally in one state of my career and I just became immersed with the coffee shop culture. Visiting city A, city B, city C and falling in love with these different shops but they all have different menus. And so you learn to appreciate the different tiers of coffee, especially the specialty coffee, the more premium side of things, and really enjoyed that.

Pernell:

But again, the accessibility of these different experiences or product experience that we learned was hard to consistently access. And it then became a matter of like, "Okay, well, what is this? And why is this?" And from there, it was a matter of, "Okay, well, let me see if I can make this." And that hints the sample roaster journey back in our garage with me really just wanting to see how is this made, and the complexity of it went down the rabbit hole from there. So I always equate it to people that have heard someone's craft brewing story and starting that journey in their basement with a few tools here and there. It's pretty much the same approach from just a coffee junkie and wanting to learn more about it, but also have access to the different things that I was learning. So just kind of taking in our own hands.

Stephanie:

I love that. What were some of the biggest surprises when you were trying to find the beans and the equipment and all that? What were some of the biggest surprises you encountered when starting out?

Pernell:

I would say, the initial shock was just how massive, complex, the coffee manufacturing side is, whether you're talking about the sourcing of beans, which was part of your question, but also literally the manufacturing piece of it. The diversity of equipment needed, the diversity of capabilities, there's just a ton of science that goes into the process of turning a crop, which is coffee coming from the pit of a coffee cherry plant, or a fruit from a coffee cherry plant and turning that into this fine, ground product that you are brewing and drinking. And the nuances in between that to uphold integrity of that is really the really enjoyable part of the science that just, you don't know until you peek behind the curtain, fall down the rabbit hole and the learning process begins from there. So it's not as difficult to fall in love with if you're curious, because of just the many nuances in ways it becomes an art after you get going.

Stephanie:

That's very cool. And did you guys launch ecommerce first or were you also exploring retail as well? How did you think about that launch?

Pernell:

Sure thing. Obviously our go-to-market strategies much more cemented in our ideation of building the brand upfront. And so to make more sense out of that, for us, looking at building a brand in coffee in the modern day coffee climate, mind you pre-COVID, for modern day coffee climate where you have independent shops and then you have of course the conventional grocery isles and the lack of accessibility, but you also have ecom continuing to be ingrained in people's lifestyle in purchasing habits every single day. But when you look at part of the reason why coffee hadn't been accessible so much in more conventional spaces, ecoms, is because of how hyper-local the product is, and the hold coffee shop culture has on people's behaviors and what their preference is.

Pernell:

For us, it was a matter of, well, we are looking to shift the economics of how currency impacts domestic youth. And in order to do that in the commodity category, you have to be able to scale it. And if we go into shops, the margin is much tighter where we it's harder to make a sustainable contribution. But if we manufacture and we wholesale, it gives us more room to make the contribution more sustainable. And by way of that, we need to make more access and scalable environments such as retailer distribution and/or ecom. And so in thinking of that and understanding that, but knowing that, all right, we're going after this with little to no resources self-funded and with our own validation and learning curves to go from that. And so we for sure launched with ecom as our fastest point of entry, but also a place where has to validate the concept.

Pernell:

And so our ecommerce platform as well as social media, the idea of ... well, there's tons of micro roasters that pop up every day, but to pop up, but also with a very different rhetoric on being this domestic impact model, we needed to find validation that consumers were interested in that as well. And so very long-winded answer to, yes, ecom was the way we started, very much part of our DNA in the sense of being ready to own our message and also provide accessibility for people given that we don't have our own storefront.

Stephanie:

I love you started with the social impact model to derive results you wanted. How much did that really push you to think bigger and be like, "I'm not just going to go to one of the coffee shops and sell to them. We need big results with our model and to do that, we need the wholesale model. We need retailers, we need ecommerce we need like everything."

Pernell:

Yeah, for sure. We have to believe upfront, and building a hypothesis for a business that the sediments that resonated with us on there being a void of values and tangible values that were relevant for us, that other people, if that opportunity existed, we'd align to that as well. And I guess because of that, that allowed us to really focus upfront on what channels make the most sense, I guess. And so the shift in consumer behavior and the validation from consumers shifting their behavior, I want to back up and say, not behavior more so than mindset. We want consumers to still consume coffee, consume especially coffee, but we want them to know that brand B versus their brand A actually has a different value proposition that allows you to extend your impact without really changing your behavior. And that allows us to actually become considered a lot earlier than going at it in a more conventional way.

Pernell:

And so that was very much key for us in the sense of how do we make it easy for people to extend an impact without having to change their behavior, which allows us to then get them on board, allows us to get retailers on board, allows us to get businesses on board, all around shifting the commerce to be able to scale the impact domestically. So it's a little much of a lift for everyday people, but to have a much more relevant tangible sustained impact.

Stephanie:

Got it. And it seems like that story in that messaging definitely helped put you guys on the radar of a lot of new customers. Was that one of the key ways that you acquire new customers and they found out about you was getting that messaging out there and getting that PR out there for like what you guys stood for to then bring in new clients, or were there other tactics you used to bring in your first customer?

Pernell:

Yeah, no doubt. There's a fine balance because for us, we look at multiple entry points or propositions for where we can be in someone's consideration set. And then as they enter into understanding our brand and they learn more about what we stand for and ideally one if not all of them, resonate as well. And that strengthens the loyalty of if they have loyalty to the product, if they entered us through the product proposition, and/or from a brand values, and then they also love the product. And so the storyline no doubt allows for accessibility when we are introduced to someone in a non-tangible space. And so we can scale our story to impact this is normal that we're looking to bring in the sense of domestic social impact versus someone is shopping in the coffee aisle and so forth. So it definitely gives us a much more scalable share of voice that people can discover us a lot faster given the sensorial experience that most people usually choose coffee for.

Stephanie:

Got it. And at what point did you launch on Amazon? Because I saw you guys are listed there. When did you decide it was the right time to sit on Amazon?

Pernell:

Amazon was always part of our model as well. It was a matter of the prioritization of the learning curve. We launched June 1st of 2018. We had our core coffee items that Q4 of 2018 set up. And it was really a matter of just having them active so we can learn, and kick the wheels and make sure that we're not doing more harm being on Amazon and not for Amazon's sake but for, again, the learning curve. And then again, transitioning into, let's see, throughout 2019, the trial and error of learning that. But then with 2020 and prior ... let's call it, this 2019 was a matter of being digitally native, but ramping up and preparing to launch in brick and mortar.

Pernell:

And so once we got past that milestone at the beginning of 2020, of course, fast forward COVID, being on Amazon allowed us to pivot more fully into maturing, what that experience, that digital experience on Amazon looked like. And so while we were on Amazon, let's call it about 15 months prior to launching our formal storefront. When we launched our foremost storefront in early April this year, that's where we really were able to drive people to who we were, what we represented in a way that it was much more convertible given that people were ... this shift of coffee and consumerism and accessibility changed completely of course because of COVID.

Stephanie:

Yep. So essentially you were shifting over to retail and then COVID hit, and then you were like, okay, now back to Amazon, back to our platform and you had to quickly change once the world started changing.

Pernell:

For sure. I think the benefit was that we were already digitally native and our site being the hero experience, having an extension by way of Amazon and the size of traffic and consumers they have. But no doubt when it became time to diversify our revenue streams, fortunately, we were much further ahead of the Amazon experience look like then more of the, it's called the indie boutique micro roasters that relied on shops and didn't have a digital experience. They had to then began the learning process as well.

Stephanie:

You were already ahead of the game.

Pernell:

Fortunately. The case study for us was a matter of, can we accelerate our awareness curve of what we stand for in order to convert enough people at a healthy enough rate that without having a shop, we can convince those consumers to purchase more coffee for home or those that were buying coffee at conventional grocery areas that the quality and the value proposition of a slightly higher price point is still worth it for them at least to get them bought in? And so the shift of COVID and the states closing and all the shops being closed, it's completely changed the necessity of everyday people to have to purchase more for home and we were fortunate on the front end of that just from a digital standpoint. Brick and mortar as well, because of the timing of us launching was just ahead of the pandemic really showing his face, but the digital pieces was definitely huge.

Stephanie:

Yeah. Before we get into brick and mortar, I want to dive a bit more into how you sell on Amazon. How does it differ when you sell an Amazon or what are you seeing right now versus your customers that maybe buy from your website or customers that even buy from target.com or something? Do you have different messaging or what kind of things are you seeing behind the scenes?

Pernell:

We offer a singles as well as a bundles, two packs. And just from a sheer economic standpoint one of the old challenges from being a omni-channel brand that also lives on is retail price and the disruption of an everyday price with the retailer versus what he shows up on Amazon. For us, we worked through Amazon's fulfillment centers and allows us to control the price, but from a bundle standpoint, it allows us to ensure that we have the same product proposition, but in no way shape or form any pricing activity would disrupt because they are from a item count standpoint, different experiences. And so that was a core piece of how we stood up our business initially, and some of our bundle items do better than our singles. The ones that don't do better do about just as strong.

Pernell:

And so seeing people go on Amazon really as a basket builder, it has been huge. And even from an awareness play on the amount of users that Amazon has, we focus specifically our consumer acquisition on Amazon platform. So we don't really focus on driving people to Amazon because there's so much space to play and win within Amazon as we're still early on as well. To the other pieces, as our site continue to build, we have seen pure incrementality from the Amazon platform where we don't see the shift of trading one consumer from one to the other. It's very key to being an awareness play for us, but then just, we have to also come back to the reality of consumer dynamics. And what does the social landscape look like? What does the economical landscape look like that's impacting those consumers? And the focus on supporting small businesses, supporting black-owned businesses, and then the accessibility of specialty coffee.

Pernell:

People are much more intentional about whether they want to save a dollar for Amazon or shave two days off Amazon versus support individuals that are trying to build their businesses and support them where margin is much more supportive and favorable. And we've seen the incrementality on both sides from consumers that are more mature on Amazon and those that are really looking to put their dollar further into the business to support the businesses during these times.

Stephanie:

Yep. That's great. Your users on Amazon, do they seem stickier? Because I often think about like, when I'm checking out whether it's through using Whole foods or whatever on Amazon, they always give me the recommendations or they're like, "You'll just buy this again." And I'm very quick to be like, "Okay, sure." And it seems like I'm a very sticky user when it comes to reorders. How does that customer profile from your Amazon customers seem to differ from people who are maybe just going direct to your website because they want to make sure to support the business and the message and they understand that by going there directly, it's probably going to help margins and the story behind it.

Pernell:

To a certain degree, our engagement is really high on our platform and with our community and our email list as well as on social. And so we get a lot of stickiness from our existing community and bringing them in. And so from an anecdotal read, there's just a significant amount of loyalty, not just to what we're doing, but what we're offering. And our subscription business is really strong on our site. When we do drop new launches, we also see a quick adoption on those as well, and so we have much more flexibility on those. Just launched a limited edition collection just ahead of the holiday season. We're able to fluidly do that where in Amazon, while it's not a brick and mortar, you still have to have much more lead time built into that versus being nimble as a small business.

Pernell:

And so even in putting something else that adds a little bit more complexity, it's incremental from a experience, from a product standpoint. Our consumers also still highly converted on that even though we have a strong subscription business. The Amazon piece is, what we see is also very sticky, but we still have much more conventional tactics on whether it's a prize promotion here or there or the affiliate programs that come from press that are driving the Amazon. We see those strong conversion pickups as well. But I would say again from an incrementality, we are pleased with the learnings that we have right now from the stickiness of it, but at the end of the day, we still from the recording of today, we are still, in this pandemic and trying to navigate life through it and the loyalty from coffee isn't going away anytime soon. And so I think people, wherever they're most comfortable with shopping are still highly susceptible to converting because they know that they need that fuel.

Stephanie:

Yeah. I think that's smart as you were mentioning to develop a different kind of experience on your website, not only with subscriptions, but also limited edition drops. So you get early access to and developing that community seems key. How do you go about, not only curating and developing a community, but also keeping them engaged for that longterm?

Pernell:

Yep. No doubt. I think the most important piece of this is no doubt customer service and experience. What we don't want to be is a one trick pony in the sense of, hey, we can do these two things really well because coffee is very vast. And as I mentioned earlier, the spectrum of coffee is really wide. And so we don't want to be too linear to offering only certain flavor profiles whereas as people either discover new brands or their options of how they safely access their daily fix of coffee or caffeine, that we then follow it lower in the consideration, or we just have to lean on whatever consumer habits that they had in the current, but we'll then be in the past.

Pernell:

And so for us, it's a matter of continuing to diversify, evolve what the experience and options are on our platform in particular and try to drive our email list and drive as many people to our site, so we can capture and engage with them so we can continue to evolve with them on their coffee journey and make sure that our offering is healthy enough, that we can do that without gridlocking our operations and our other distribution priorities.

Stephanie:

Let's talk a bit about retail. You're in some good stores. I saw you're in Whole Foods, Target, and I was reading a bit about how you got in front of these retailers. I think you were going to sourcing call events where they had like pop-up events. And I was wondering, how did you get in front of these retailers? How did you peak their interest and what was that process like?

Pernell:

For sure. A big piece of BLK & Bold and my co-founder and I bringing this to life was our formal background prior to. We launched this in our 30s, our early 30s and Rod's background being in philanthropy and fundraising with higher education healthcare, and mine being in corporate merchandising, brand business development around packaged goods. And so the lens that we took to the white space of coffee was a by-product of what lanes exists within coffee. And the understanding that the accessibility gap was huge when you stepped out of a premium specialty coffee shop that's in neighborhood A somewhere, and trying to carry that across the country. And so, understanding that we know where the opportunity is, which again, ecom retailer shelves, now we have to build something viable enough that allows for them to consider us from whatever the right starting point is and from the way those retailers test or minimally launch.

Pernell:

And so our journey throughout 2018 and 2019 was operations, learning curve and validation of consumer marketing. We did a ton of road shows, just consumer shows engaging them on the product. And the aha moments for most of them were the 5% for our youth model that we have. It wasn't where they were introduced to us. It was supplementary validation for them. And so continuing to drive that part. But then also just from formal background within retail, understanding that there's different engagement points. We are a certified minority business enterprise, which is a national certification organizations out like that, where they have shows and tons of industries that attend these to meet diverse or minority owned businesses. And fortunately for us, we have visibility to select retailers that attended these as well.

Pernell:

In addition to digital platforms, there's one called a RangeMe for those that are not familiar, that is a virtual marketplace for all packaged goods brands and merchants, which is hyper dependent in today's climate, where corporate is not allowing people to travel. And so knowing where to start and having something viable was number one. Number two is being a student of those retailers isles. Understanding who was in the competitive space, how long they were there, what a swarm in they were there for so you can understand what their core consumer was, but then what value proposition do we incrementally bring for that merchant? What problem are we solving for that merchant? And so that was a big piece of when we had our opportunity to engage with these different retailers. Target, for an example, we understood what value proposition we were looking to bring to them. The conversation from there became a matter of readiness operationally, organizationally, to be able to launch and sustainably start with intention, of course, sustainably growing.

Stephanie:

And was there a bit of back and forth with the retailers when they were like, "We're interested, we love your model, the coffee is great." Were they giving you any guidance on, here's what we think will do well on the shelves or here's how to set yourself apart, or was that really all on you guys to do the research, figure it out and present, here's some maybe new packaging that we think will do well at Whole Foods?

Pernell:

Yup. For sure. It definitely, it can be either way. We had our first, let's call it national launch or a major launch was with Target Corporation, at the beginning of this year on about 300 ... it was 350 stores across the major markets within the US. The conversation and the process of having that launch was about a nine month process from introduction to essentially the product arriving on the shelf. And this was from our social media engagement and fortunately word of mouth being passed on to Target for a show that they were having, we received an invite and we were fortunate to have an introduction with the coffee buyer and allowed us to further the conversation, this is not only our business model, but our case, the consumer that we're looking to capture and the incrementality of that consumer to retail.

Pernell:

But then, thereby also helped us understand where our strategic priorities were in a sense of how this space is set up and where there may be room to identify the incrementality if it's really there. And so the feedback on just the core consumer that we're going after and aligning on that was very real. And quite honestly, for us, while we had that opportunity to have the connection and the conversation, we knew we weren't ready because where our packaging was, we had a checklist of key things that we wanted to accomplish before we entered onto a shelf, so we can have our best foot forward, and we were halfway through that checklist. And so the merchant said, "Hey, well, when do you think you're ready? Well, here's the key things that we need to accomplish."

Pernell:

B Corp certification was one, which was, we hadn't got through the finish line on it yet, and the rebrand on packaging and also some of our operational scalability. And so that nine month journey was really with, understand the strategic vision values and knowing that with accomplishing that, we can have a solid start together to go push it through. In January with that launch then gave us the opportunity to credibly approach other merchants with some understanding that we were already vetted and well equipped to enter into their shelves as well if we had the same alignment on the value proposition. So the Whole Foods conversation was a lot more in the sense of, "Hey, we see what you're doing here. Here's some of the assortment that you have that we think will work really well is some feedback on what may not be yet, but let's get started and let's find out together."

Pernell:

And so it was much more collaborative in the starting point and from my experience, that's exactly what you want. If you're pitching to retailers with the hope that they will take whatever you're pitching, I made the perfect vision, they didn't ask me a question, they're going to take it. Where the risk is that they don't understand enough of where your blind spots may be, and you're all going to find out-

Stephanie:

Yeah, you want to partner.

Pernell:

Yeah. You all are going to find out together and that's the last thing, because it's really expensive to back out of distribution. So any who.

Stephanie:

That's so smart. I love the idea that you had the checklist going into it and you were open with Target, like, here's the things that we need to knock out. Tell me a bit more about what else was on that checklist and why were they important? Like why were you looking to have that B Corp certification and what else was on the checklist on top of that?

Pernell:

Sure thing. The B Corp I would say is a major one. I have to remember some of the smaller ones, but the B Corp was a major one mainly from being in retail. And once you learn about B Corp, it's hard to unsee it. But it being a ... it's essentially a independent organization that certifies businesses, those that value stakeholders equivalent with shareholders. And so being for-purpose being equally as important as for-profit and you have organizations like Ben & Jerry's, Tom Shoes, Warby Parker, Patagonia, these major organizations that are all at B Corp, they continue to move into improving society while again, building sustainable businesses.

Pernell:

And for us with, having this domestic social impact focus, the model doesn't exist. It's unfortunate it doesn't, but that's also a core reason of why we decided to go into this space. And knowing that, given that it doesn't exist and at the scale that we have to start at, we want it to be taken serious to our consumers and our stakeholders on the intention of where we're going while we work on getting there. And so with the launch into retail and being on the national stage, we took it various cities to make sure that we have third party validation vetted out already for us, for people that can engage with the brand.

Stephanie:

I don't know much about court structures. Are there also benefits that come with being a B Corp?

Pernell:

Yep. There's different tiers of ... you can incorporate it as a B Corp if your state has that as a legal option. And that I think there's definitely a different tax implications for being a legal B Corporation. And then there for states that don't, and this is the way that it was initially set up is that there's a certification and you're certified by, it's called B Labs, which is the umbrella organization. So you're certified by B Labs. And then as they continue to build momentum and further penetrate their models where the states began to allow it to be a legal entity structure.

Stephanie:

Got it. And then tell me a bit about, so you're getting into these new retail locations and you're working on your packaging and getting certifications. Tell me about how you guys are preparing for the orders. What were you doing behind the scenes with distribution and logistics and setting up partnerships? What did that look like?

Pernell:

Chaos.

Stephanie:

Craziness to say the least.

Pernell:

Yep. Chaos. Again, self-funded bootstrap and never want to put the cart before the horse was really a matter of trusting our forecast and building enough bandwidth to at least get through the initial hump of a national launch. And so then instead of today, we do everything in-house. We source and we work with our importers. They move the goods right with export departments, but we are identifying what origins we want to source through. We're doing all of the testing cupping and validating the integrity of what we're putting into our product. We micro roast in-house, we package in-house and we work we shipping partners to get goods out the door.

Pernell:

And so at the time, we had graduated from the garage and in to a shared production space with a local brewery. That's where we had our commercial roaster and we essentially had to tighten up our ship, bring onboard a few individuals that had coffee background in roasting and packaging to help us get the Target launch out of the door. And so that was a mad hustle because again, it was, here's what we are, here's the bandwidth we have, we're going a 100% capacity, sometimes a little bit more than that to get the launch out of the door with the intention of sourcing a new location that we can grow into. And so, fast forwarding that story, we had identified a location and we're closing the deal in March. And of course pandemic changed all of that. And so we found ourselves still running idol in that location for a while, but it wasn't with a bevy of orders and things until we started getting further into the summer. And that's when we got flooded in that space with orders go on and so forth.

Stephanie:

If you were to look back and change anything, what things would you have done different if you were to start again? And it can't be everything. You just got to pick me like, there's this one thing when I was setting up my partners or distribution or with the retailers I would've maybe done this differently.

Pernell:

It's tough because there's been too many reasons because there's so many learnings and it sounds so cliche, and that's why I was trying to prevent it sounds so cliche, but there are so many learnings that if I didn't learn them then I'm going to have to learn them later and I just don't know it yet. Because we are continuously learning and it's not just about coffee, but it's about, you're in a space where we are looking to win over over the longterm consumers into not only what product was selling, but the impact that we're selling and there's so many curves along the way. And so I am happy to have the learnings that we do have in the bank checked off. I think more so it's a matter of how do we continue to broaden our view to mitigate blind spots?

Pernell:

What I would say is one of the things that was hugely helpful early on as we were initially launching with literally our hearts on our shoulder was sharing what we were looking to build with some other professionals, just more mentor related people in the network. And as our informal mentors, that fortunately connected in to a formal mentor that was previously executive within the industry and just gave me a history download on how coffee and the industry came to be. And that in itself, just broadened context more so than why you have to, you're crossing Ts and dotting Is and every single step of the process. But to have that broader context of how the industry around you got to its point just fast forwarded that blind spot for sure. I would just try to color it all in.

Stephanie:

Do you have other mentors right now that you rely on or that help when it comes to guidance or showcasing what else is happening in the industry or ecommerce as a whole that you lean on?

Pernell:

Yes and no. Informal, for sure. Students of work, without a doubt. I think it's important to have a broad lens on what's working across different industries in digital in particular. And so if you rely on someone that's hyper-focused on a particular industry, then it may mitigate you from having your antennas up to learn about other things that are working elsewhere. But I'd say informal, yes. But tapping into what's working for them and learning from there, it's really hard. This may be a me statement, but I'm sure it may resonate with someone else out there. It's really hard to move at the speed of entrepreneurship and startup, and to have someone that isn't as intimate with your business to give you specific guidance on building the business more so than giving you more visibility to things that work and that exist. So it allows you to be able to align closer and jumping into rabbit holes further that you know may be in the path where you're going. So much work is done offline that having visibility of things allow you to dive into it without having to bottleneck someone else's time and do it.

Stephanie:

I think that's really good advice. And a mentor might fail to give you a higher ideas or industry level things or maybe connections but I think it's the same thing when it comes to investors, the second someone starts giving you like really nitty-gritty advice on what you should do, you might want to be a little wary of that because you know your business best and you know where you're headed. What's next for BLK & Bold. Where are you guys headed? What are you betting on right now?

Pernell:

Sure. We're still young and awareness is still important, accessibility is still important. The more traction we get, the more we can further cement our contribution model. Now that we've kept the door open, even minimally in the product assortment that we do exist in, the more immediate is to continue to round out our accessibility, but with our key partners that have strategic alignment with us. And so we have retailers that we're on board with today, Target, Whole Foods, Hy-Vee in the Midwest and we're rounding out a few more that have shown very important strategic alignment with us. But then we're also looking to diversify outside of just retail shelves and moving into food service that allows us to have more B2B contracts that are now consumer adoption, but also businesses to help further the impact which ultimately helps drive consumer awareness as well.

Pernell:

And so from a ecom standpoint, home base is home base. And so we're going to continue to pour into our website to be more proactive in how we drive engagement, but also acquisition. And also, we're selling a tangible good. And so while that's key and that's great, we also have to look at supply chain, all the efficiencies, but innovation that's out there to allow for us to continue to connect and win with convenience and accessibility from what that means from a D2C space as well. We got some ideas under our belt on some strategic partnerships that can allow us to further that. But without a doubt, continuing to further develop our D2C. And the more important pieces that help our community better be more transparent with how we are building and continue to support from an impact model, but also to build more loyalty for that come in to see it in action.

Stephanie:

That's awesome. I'm excited to see, especially that B2B piece too. I think that could be such a strong partnership. I used to work at Google and I think about the road shows they would do and having companies come and all the employees would test out the coffees and the chocolate and all that. And that could be huge and very smart partnership to have that B2B angle in there.

Pernell:

No doubt.

Stephanie:

All right. We have a couple minutes left. Let's move over to the lightning round, brought to you by Salesforce Commerce Cloud. This is where I'm going to send a question your way and you have a minute or less to answer. Are you ready for now?

Pernell:

We'll find out. Let's do it.

Stephanie:

All right. What's up next on your Netflix queue.

Pernell:

Gosh, I just googled this yesterday. The Undoing. I think that's what it's called. We just ran through all the Schitt's Creek. So TBD on Netflix.

Stephanie:

All right, there you go. And I've got Hilary in this document say, "It's amazing, and it's on HBO." So that works.

Pernell:

Love it.

Stephanie:

All right. What's next on your reading list?

Pernell:

Oh my gosh. Besides emails?

Stephanie:

Yes. Besides emails. It doesn't count.

Pernell:

Oh man. It's a great question. I digest so much content through just online, but if I'm looking at something tangible, it might literally be a roasters magazine.

Stephanie:

That's great. We have not had anyone say a roasters magazine.

Pernell:

Yeah. In the anecdotal know of what's going on.

Stephanie:

That was perfect. If you were to have a podcast, what would it be about, and who would your first guest be?

Pernell:

Oh, goodness. First guest would be Rod, my partner. What it would be about? I don't know, the random things we come up with throughout a day, which is a plenty, and most people don't get to see or experience. You're building something with a best friend you have for over 20 years. You can only imagine the randomness that comes about within a day.

Stephanie:

Oh my gosh. I love that. I could see that being really fun. Pernell and Rod's musings.

Pernell:

Love it. Love it.

Stephanie:

That's great. What topic or trend or theme do you not understand today that you wish you did?

Pernell:

That I don't, that I wish. Oh my gosh. This sounds terrible, but Twitter. I tried to figure out my Twitter game early on when everyone else was, and I was just too loyal to Facebook. And now here I am still trying to figure out how to not tweet on the wrong thing or something.

Stephanie:

Me too. Well, what's your Twitter handle? We'll get you some followers there.

Pernell:

It's Pernell Cezar. [crosstalk] name.

Stephanie:

Oh my gosh, you don't even know.

Pernell:

Yeah, I don't.

Stephanie:

Well, that's the problem Pernell, you don't even know your handle. I actually don't know if I know mine either. We'll link it up in the show notes. There you go.

Pernell:

Okay. Appreciate it.

Stephanie:

All right. Then the last one, what one thing will have the biggest impact on ecommerce in the next year? And it can't be COVID.

Pernell:

I know that's right. That's a good point. From a good standpoint, I do think supply chain, speed of delivery on native sites and not having to be relying on third party commerce platforms. We know the behemoths, they in-house a lot of that and they have major contracts that do that. But the comeback of boutique independence and owning their future I think really be a by-product of independent supply chain companies doing the same thing. So again, from a packaged goods or a tangible product lens, but I think BLK & Bold can deliver something in a matter of hours and not having to rely on Amazon, that just drives that much more engagement and loyalty for the longterm.

Stephanie:

That's great. Cool, great answer. All right. Pernell, well, I've had a blast talking to you on here. Where can people try out some BLK & Bold and learn more about you other than Twitter? They shouldn't go there right now.

Pernell:

Yeah, don't go there. But on social media platforms, BLK & Bold, spelled B-L-K and Bold, and then our website, blkandbold.com.

Stephanie:

Awesome. Thanks so much Pernell. It was a blast.

Pernell:

Yeah, same here. Thank you.

What Should Your Ads Look Like? Diving into the Data on What Drives Performance

info@mission.org (Mission) — Tue, 5 Jan 2021 08:00:00 +0000

Think about the last ad you saw an ad that had an image of someone’s living room. What color was the throw pillow on the couch? Was there a dog present? How many people were pictured? You might not know the answer to those questions, but the marketers who put that creative together sure do, and you better believe that they thought long and hard about each of those aspects and dove deep into some data to decide exactly what to include in the ad

Those minuscule details may seem frivolous to the naked eye, but the data proves that every decision you make in your creative process has an impact on the bottom line, and the ecommerce businesses that pay attention to the data while still putting their own spin on the creative aspect are the ones that are rising to the top.

R.J. Talyor is the founder and CEO of Pattern89, which uses A.I. and machine learning to analyze advertising and guide marketers toward the performance metrics that matter. On this episode of Up Next in Commerce, R.J. takes us through the most recent trends report that Pattern89 put out, which includes some important information about why businesses should be paying particular attention to copy and hashtags. Plus, R.J. gives tips on how to avoid the trap of following “best practices” and why creativity will always win.

Main Takeaways:

Big-Time Creative, Small Time Dimensions: Marketing creative is made up of tens of thousands of dimensions, all of which can be measured and distilled into performance metrics. And when those metrics are measured, you can utilize that data to inform the decisions you make about what elements are more beneficial to include in your ads (like an orange pillow versus a blue pillow and a cat versus a dog).
#WorthIt?: Including hashtags in your marketing copy is a method to improve performance. The flip side of that argument is that hashtags have a cost, particularly if you overlay a hashtag on an image or video.
The Same… But Different: When developing creative, marketers are often looking at the same data, trends and industry reports, and they are following the same “best practices.” The trick is to take the information and make it your own in order to develop creative that stands out rather than just gets lost in the sea of “what works.”

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome back to Up Next in Commerce. This is your host, Stephanie Postles. Joining us today is R.J. Talyor, the CEO and Founder at Pattern89. R.J., welcome.

R.J.:

Hey, thanks for having me. Appreciate it.

Stephanie:

Yeah, I'm excited to have you on the show. I just downloaded your report, as you saw, right before the interview and I feel like there's some good juicy stuff and the things that you guys are doing and we'll have a lot to talk about today.

R.J.:

Yeah. Great.

Stephanie:

So tell me a bit, what is Pattern89 and how did you go about creating that?

R.J.:

Pattern89, what we do is we predict creative performance with machine learning and AI, and I've worked in digital for almost 20 years now. I worked at ExactTarget and then at Salesforce and then at another social startup, and learned quickly that marketers are spending so much time creating journeys and figuring out who their audience is, but still use a lot of their gut on what creative to put in front of those audiences, or in the places in the journey. While data is being used to figure out what and who, it really is on the creative side, still kind of a gut decision. And so set out about four years ago to help marketers use AI and machine learning, to predict creative performance, and now we're a 25 person strong scale up and serving customers all over the globe.

Stephanie:

That's awesome. I was reading a bit about your data co-op and how many brands you have that you get to look through all the data, so give me a little bit of like the behind the scenes of what kind of brands do you have in there, if you can share, how many do you actually have, and how do you go about looking at all of their data?

R.J.:

Well, when we started the business, we knew we needed a giant data set in order for the machines to find patterns and outliers that would actually help creatives, and so we started offering a free scorecard or creative assessment in exchange for joining the co-op. We're almost at 2000 brands who-

Stephanie:

Wow.

R.J.:

... have connected their accounts to Pattern89. And our machines, they don't actually look at anything that's identifiable. Instead, they're looking at 49,000 different creative dimensions of a piece of creative and tying it to a performance metric. As an example, it might look at a picture of a living room and say, "All right, there's a couch, plants, window. Is there a human or not? What color is the couch? Is there a blanket on the couch? Is there a dog in the picture?"

R.J.:

Then associate that with a performance metric, like, did it drive X purchases or Y video views or X views, so then we can understand in aggregate what are the patterns and outliers that we're seeing across massive amounts of data, so that we know living rooms actually perform better when there's an orange throw pillow on the couch, for example, like the one small detail. So massive amounts of brands, massive amounts of data, and really granular creative insights.

Stephanie:

Very cool. How do you go about, if you're looking at that kind of anonymized data and you see something doing well, how do you know it's doing well? Maybe because it's a Nordstrom where it's like, well, of course they have brand recognition, it's very easy to buy from them, versus a brand new D2C company where maybe one of their ads is doing well, or it's not doing well and it's kind of getting skewed because they don't have that brand recognition.

R.J.:

Yeah. That is a big question. The first thing to know is that our data science team uses a set of statistical tests to kind of ferret out what is actually driving the performance or not driving the performance, so that we're not chasing after kind of red herrings. The other thing is from an audience perspective, the history of that audience use, so is it a brand new audience or is it a legacy audience? Is it a customer loyalty audience or something else like that? Those are all the components that are also taken into account so that we can distinguish between maybe the brand legacy of a Nordstrom versus an up-and-coming D2C startup and still provide statistical significance at over 95% competence.

Stephanie:

Got it. What things do you think are going to work in 2021? I mean, I was just going through the report that I mentioned earlier and I mean, it was cool because it's all the way down to "Here's certain emojis and colors and imagery is up, but maybe with multiple people or one person and video's down." So tell me a little bit about what you guys are seeing and predicting to work well when it comes to advertising and copy in 2021.

R.J.:

Yeah. Well, the first thing that it's important to notice, the creative lifecycle has shrunk and rom a creative life cycle perspective, it's just a lot shorter than it's ever been. In addition to the creative life cycle shortening, what is performance in those creatives is changing as well, so the best advertisers have a 2:1 image to video ratio. While video performs a lot better in general, image to video 2:1 is the best performer for top performers in the dataset, and we're seeing more and more emphasis on video and video performance, but videos tend to be more expensive, so 2:1 is a good framework.

R.J.:

Then taking a look at what's trending and what's forecasted to be a performant in 2021, we see things like TVs and electronics really improving cost per clicks, also spas and massages, those types of things. And then maybe not surprising, we're seeing a lot of isolated people, so one face in creatives and those people are reading or studying or doing something by themselves, which kind of reflects the world that we're living in, especially as we head into 2021.

R.J.:

One of the surprising things, and sorry for all the cat lovers out there, is that pets typically do very well, dogs and cats, but we're actually seeing cats driving performance down. So it's more expensive to advertise with cats in 2021, so just keep that in mind as you're here.

Stephanie:

That's funny. Don't put a cat in your ad.

R.J.:

Yes, exactly. Yeah. But consistent performers, things like images or videos of those people exercising, phones, images of cities, those types of things are really staying flat. This is all going to change by audience and by brand, but in aggregate, those are the things that we're seeing rise, staying steady, and then underperforming in terms of predictions.

R.J.:

The other thing that we analyze is color and the importance of color driving performance in 2021. In December, we're really seeing kind of teal colors and blues perform best, but what's trending up in 2021 are, it's kind of this peachy color, and I can give you the exact hex code for the designers out there, but peach and dark green are really trending up and they've been trending up over the last three years, while kind of a pinky and a brown color are really trending down for the last three years and will continue to trend down. It's kind of funny as we think about what background colors or what shirt colors our models should be wearing, or how we should stage a photo shoot, or even what stock photo or image or video to pull, these types of decisions can impact your CPMs, your CPCs, and your click-through rates and ultimately your performance, so it's good to have the data on your side.

Stephanie:

Yeah, that's great. The one thing a lot of guests have mentioned is that more organic videos, iPhone videos, even iPhone photos have been performing better for them then-

R.J.:

Yes.

Stephanie:

I mean, because a lot of them couldn't stage things anymore in their studio, or didn't really want to use the stock photos. Are you seeing the same thing?

R.J.:

Yes, and especially selfies, really driving performance up. So when influencers take a selfie video, which might've seen sort of not have been as polished as in the past, but selfie videos in the data is actually spiking in performance as well as popularity, so yes is the answer to that.

Stephanie:

Cool. Any other trends in that report that stood out to you that were maybe a bit surprising and you were like, "Why is that happening" or "Why is the data showing that" where you had to dig in a bit deeper?

R.J.:

One of the other things that's really surprising when you deep dive into the report is copy and the impact of copy alongside your creative. Oftentimes we spend a lot of time developing what the creative would be, and then maybe we'd just go with a standard message, but the impact of performance when you have copy that's like 5 to 15 characters long, that's what's going to drive the best performance for awareness or top of top of funnel campaigns, whereas body copy needs to have between like 40 and 60 characters and should include a hashtag.

R.J.:

What's a little bit surprising about hashtags specifically, is that including a hashtag overall improves your performance, but it's going to be a little bit more expensive. And then even further, if you put a hashtag as a text overlay on an image or on a video, you're going to see the costs go up even more. So it's funny how best practices intersect with performance in good and bad ways, and what we're kind of distilling down is how the algorithms at the individual platforms prioritize or deprioritize content, based on supply and demand, like what's popular and what's actually performing.

R.J.:

If you think about it from the platform perspective, they want creative diversity. They want you to be producing something that creates more thumb scrolling and more content engagement. So they're looking at how much of X do we have, how much of Y do we have, and then prioritizing content that favors newness and differentiation and engagement. Anyway, some of these things are like, need to put a hashtag in there because that's actually going to drive your performance up, but it might also drive your cost up so you've got to kind of weigh the pros and the cons of each creative dimension.

Stephanie:

Cool. I'm thinking about all this data and feedback that you're giving to customers, and how do you make sure that they don't all start doing the same thing where it's becoming like a self-fulfilling prophecy? Because I know a couple of guests prior who've been on the show previously have mentioned, like, "Don't go in the Facebook ad library and try and get inspiration from there, go to the books from the 1960s and check out what was happening back then. Don't just look at what your competitors are doing, because the second you start just doing what they're doing, you lose." So how do you make sure that your clients aren't just all doing the same thing, driving the same trends, driving the rates up or down because they are all hearing like, "Oh, the color green is like the way to go"?

R.J.:

Yeah. Well, I love what you're saying there because I have really railed against "best practices" as a way of doing marketing, and so much is changing that I think a lot of marketers go to "best practices" and then look at a creative forecast from Pattern89 or some sort of other data source and say, "All right, that's what we should do." The problem is exactly what you're saying, which is that if we all do the same thing, then the advantage goes away. Instead, we need to think about data and creative AI as a recipe. Every chef gets the same... I love watching food TV, like Food Network and all that stuff, and you can give Michelin star chefs the same recipe and they all make something different, even though the recipe components might be the same.

R.J.:

I think that that's how we have to think about creative. How does our brand interpret these recipes? How do we make it distinctly ours and so our brand message shines through while also honoring those creative elements that the algorithm cares about? A good example is we know that 40 to 60 body copy characters, so we should have a 40 to 60 characters in our body copy, and a hashtag. So don't go copy paste some body copy from a competitor and just change the brand name. Instead, what's the unique message that you want to tell in that? And then what hashtag can you use that actually spells out your brand message? Or if we know that images of people studying or reading books are important, what is the way that we can tell that brand story in a funny way, an engaging way, in a serious way? However it reflects your brand.

R.J.:

I've used this slide in a presentation where I actually have five different brands, Instagram posts, where they're all advertising athleisure wear, and they literally all look the same. It's all a woman who looks fit, who is exercising in her sort of ethereal-looking inside apartment. It's like literally the same creative and you can't distinguish between those ads, and I think that's where we're seeing kind of the "optimization to best practices" cause problems. Instead, we need to figure out how do we take this creative recipe and put our humanness or human creativity to tell that story in a new way? So be aware of best practices is the summary there, and instead use it as a recipe and create from there.

Stephanie:

Cool. Are you kind of guiding your clients when you're like, "Okay, we see these emojis are trending, these colors are trending, here's the copy limits that are trending, but here's maybe how to apply this to your brand" or like, "These photos are trending, like you said, but here's a funny spin that you can put on it individually." You're kind of giving like one-to-one advice instead of just like, "Everyone try that and figure it out for yourself." How do you go about guiding your clients?

R.J.:

Pattern89 is a platform, so we serve as a data service, effectively. When we get on a call with a customer, our creative agency will often say, "Here's what's trending up and here's how your data matches or doesn't match that trend. And then also, here's the counter-trend to it." Some customers are like, "No, we just want to kind of play it safe and go with the trend." Others say, "Hey, what's the counter trend? What's the outlier? What is the opportunity there?"

R.J.:

It just depends on if the brand likes to play it safe and predictably, or they're willing to take some creative risks, and it actually depends on their level of risk tolerance there, because some people just want the sure thing and, "We can follow the trend or the best practice." But then others say, "Hey, we're willing to take a risk. Our brand is about risk-taking or about X." So it depends based on that. Then sometimes we work through creative agencies and digital agencies and coach them to say, "Hey, here's the risk of going with the trend versus here's the counter trend" or "Here's how your data intersects or conflicts with that."

Stephanie:

Yeah, very cool. What kind of variables do your models look at to see? I mean, not only the cost behind things, or maybe what's doing well, but how do you know something's doing well? Is it engagement? Is it people clicking through on an ad? What's the success rate in figuring out what a trend is based on? One good example is someone was talking about influencers on the show and they said someone can get like a billion likes on their posts, but that doesn't mean they're an influencer. You need to look in the comments and see are people in there asking like, "Hey, where can I buy that shirt from" and actually consumers who are ready to convert and do what that person's saying. So what things are indicators to you in ads doing well and actually will create a conversion or a new customer?

R.J.:

Every prediction in Pattern89 or in the platform has two factors. One is who's the audience, and then two, what's the objective? The audience can be net new customers, it could be loyal customers, it can be previous purchasers, whatever the audience makeup is. Then the objective is what the machine understands. Are we trying to drive the lowest CPM? Are we trying to drive app downloads? Are we trying to drive purchases? Are we trying to drive likes and follows? Whatever that overall objective is, so the machine knows, "This is the audience, this is objective, and then this is the candidate set of creatives that we want to drive for one of those objectives for that audience."

R.J.:

So if the objective is purchase, then we can tell you exactly what's going to drive purchase. We can't predict sentiment of comments. As you're suggesting with influencers, that's just a limitation. But a good point to note that what the AI can do and can't do, so that you can set the engagement up for success.

Stephanie:

Is there any new advancements in tech data you're looking at to kind of gauge that sentiment? Or anything else where you're like, "We aren't there yet, but we're looking at this because we think it's an important field going forward"? I mean we just had yesterday, the VP of data science at Stitch Fix on, and she was kind of mentioning just that there's a new demographic coming on the market, they speak very differently, and so they need different types of natural language processing to figure out who this person is to then be able to respond to them how they want to be responded to. So is there anything like that that you're watching right now or looking into?

R.J.:

Well, just on that comment, I need some natural language processing to handle my 12 and 13 year old nieces who I'm like, "I don't... " When we text with them, I don't know really what they're saying and I thought I was cool. So I'm just using that to-

Stephanie:

Oh yeah, my-

R.J.:

Yeah.

Stephanie:

I feel that. My mom sends me screenshots that her students, because they're all doing Zoom calls right now, she's a teacher, and she's like, "These kids just talking, they're like 'NVM,' what's that mean? And then there's a U and then there's a two" and this and that. She's like, "I don't know." And apparently they gave her the acronym for "Pony hair, don't care," but they just put PDC or something and she's like, "What's that mean?" I'm like, "I honestly don't know." I don't think that means anything. And she was like, "I found it out. They were making fun of my ponytail." I'm like [inaudible 00:18:44].

R.J.:

I imagine Urban Dictionary is getting a lot of site traffic from people like me these days.

Stephanie:

Yeah. I mean, yes.

R.J.:

Well, I'll tell you, we've heard a lot of customers ask for sentiment, like you're describing. The other thing that's of particular interest is the multi-touch journey. With Pattern89, we can predict what people are going to do, like a one hop. So I can tell you if they're going to download the app, but I can't tell you if they're going to use it, or I can tell you that they're going to put something in their cart, but maybe not purchase it.

R.J.:

What marketers really want to understand is how do we actually predict creative against each of the steps of the marketing journey that they're setting up for the customer, versus like a point in time? That's what we are really locked in on, is how do we predict creative performance across that life cycle, versus just, they did one action on a social site or one action on as a result of seeing your ad on Google or something? So it's this multi-touch attribution issue.

Stephanie:

Where do you see the future of attribution going? Right now I'm interested in it because I was just listening to a bunch of podcasts about attribution with TV and other types of media and how it's very slow to evolve, but it's something that people are going to be very eager to figure out over the next couple of years, about how to like measure things. Is there anything that you guys are looking into in that area or just keeping tabs on?

R.J.:

Well, I'm keeping tabs on kind of there seem to be two counter trends going. One is that everyone's going to new payment options and new conversion options on their phone, and there just seems to be more and more like mobile payment, fractional payments, mobile wallet, Afterpay, all that type of stuff that I think is going to create even more data that we can understand the ultimate conversion especially in retail.

R.J.:

The counter-trend is a cookie list future and a highly-private world and GDPR, et cetera. Those seem to be counter trends to me where we could get to a fully anonymized world where you just have no idea what happens, or to whom, I guess. And then the opposite is we can know everything. So I don't know that I have an official prediction, but I'm certainly interested in those paths, diverging and where we end up. Yeah, I think that that's going to be super interesting as it accounts for attribution.

Stephanie:

Yeah, I'm definitely paying attention to the cookie list future, and I mean I think Facebook's fighting pretty hard at that so it seems like it might be a long process if it were even go through, because a lot of people are against it. That seems like a scary place though if you really can't show what you're doing.

R.J.:

It is, but I think... I have a creative background, I majored in English, I have a master's in creative writing, and I came into technology kind of thinking creative is the actual differentiation. But so many liberal arts people, so many marketers have been told to act like machines and just make only data backed decisions, and of course that makes a lot of sense, but I think we've kind of over-indexed under the data side and it kind of left creativity out to dry as kind of like, "Those are the crazy creative people over there" or something.

R.J.:

I think that the cookie-less future and all this, because ultimately we're going to lose some of the sight of the data that we were able to pull before, and instead, creative is going to win. Personally, I believe that as the CEO of Pattern89, creative is going to really matter as we head into the next 5 or 10 years, because we don't want to... To the earlier question about isn't AI or machine learning just optimizing to the same exact thing, well, yes is the answer. How do you diverge from that while you introduce new creative ideas? You differentiate your brand, you tell a different story, and I think that's super exciting. I think we're in this a reemergence of creativity that I nerd out on and I'm optimistic about.

Stephanie:

Yeah, I'm optimistic. I'm just wondering how would you know it wins? How do you know what does well if you can't even tell what happened?

R.J.:

That's true.

Stephanie:

When you can't track it?

R.J.:

That's true, that's true. That's fair.

Stephanie:

So as a creative, how do you go about sparking creativity? What does your process look like to maybe not only help you know yourself at your company, but also the brands you work with to try and also get them to think creatively?

R.J.:

Well, I mean, I guess ironically, it does start with data. We look at trends on a monthly basis and we forecast our monthly trends to understand what is it that's trending up, trending down, and then move that into, how we... I mean in startup land, we're always trying to figure out what is the counter trend? How do we stick out? Because we don't want to say the same things that big, big companies are saying. We want to see something different and something risky.

R.J.:

So that's what we kind of analyze the trends and then go against them to figure out how can we stand out? I'm a big proponent of running and swimming. I grew up swimming, I swam in college and I still swim, and running, swimming I think that provide that kind of meditative or that space to kind of let your brain sort of turn off, but still be on, you know? And then come back from a run or a swim or after you've looked at some of that data and then new ideas start to emerge, and start pitching them and then figure out if those ideas might work or not.

Stephanie:

Yep. Do you ever look through historical things, since what's old is always new again, eventually? So you go back to the archives and be like, "Here's something that worked in the 20s, let's try this."

R.J.:

Oh yeah, yeah, yeah, yeah. We're actually doing some 20s based stuff for 2021 and the kind of Roaring Twenties is coming back. We just did a cool campaign called DonDraiper.com, that was D-O-N D-R-A-I-P-E-R. So like putting the AI in the Don Draiper, and looking at all these 50s campaigns and 60s campaigns to understand what actually would be predicted to win now, and it is kind of amazing to see like copy as well as imagery that was being used at the time and in-color, and how those were resonating using REI to predict whether they would resonate with this audience in today. Yeah, I think that's a definitely a good place for inspiration.

Stephanie:

That's cool. Do you see some of those more vintage ads and photos and things like that working over the next couple of years?

R.J.:

Well, I don't know about the next couple of years, to be honest. I think in 2021 alone, we're going to see a lot of nostalgia and I think that that is going to be a big factor because we're all looking for comfort after 2020. I can tell you on 2021, yes, nostalgia I think is going to be a big, big trend.

Stephanie:

2021 will be nostalgia for 2019. "Ah, the good days. What happened in 2019? Let's bring back those vintage memories."

R.J.:

That's funny.

Stephanie:

Are there any new consumer shopping behaviors that you guys are watching right now that you think are going to continue post-COVID?

R.J.:

I think touchless everything, even in store, is a big one. And the one I mentioned earlier about mobile wallet, I think mobile wallet adoption is just going to spike, and then I think all sorts of augmented reality capabilities are also going to, because going to a showroom for example, to see a couch may or may not be something that an individual is willing to do anymore, to make that separate trip. So, "I want to see it in my space. I don't want to buy it without seeing it and then return it, have a hassle with the return, especially with a large purchase item for a home."

R.J.:

So I think that mobile wallet is going to explode. It already has, but coming from mobile land in my previous roles, it's amazing to see how that's taken off. Then I think augmented reality apps, they're just going to be driving the future of commerce.

Stephanie:

Cool. All right, well let's move over to the lightning round. Lightning round is brought to you by Salesforce Commerce Cloud, but this is where I'm going to ask you a question and you have a minute or less to answer.

R.J.:

Okay.

Stephanie:

Are you ready, R.J.?

R.J.:

I'm ready.

Stephanie:

All right. We'll start with the hard one first. What one thing will have the biggest impact on ecommerce the next year?

R.J.:

Creativity is going to be my answer, because actually our data shows it. For example, masks in ads, this is an interesting thing. So masks in ads are being more popular, but they don't perform as well because people don't want to see kind of the ugly truth when they're viewing creative. How do we creatively manage and creatively work through a situation that everyone is tired of feeling? I think the breakout brands and the commerce brands that find a way to tell an empathetic but inspiring story creatively are going to win.

Stephanie:

Yep. I like that. Yeah, that's a good point too, of just because it's happening doesn't mean people want to see it-

R.J.:

Right.

Stephanie:

... everywhere they look like. Sometimes people might want to see what the future could look like and inspiration.

R.J.:

Yes, exactly.

Stephanie:

What's up next on your Netflix queue?

R.J.:

Ooh, let's see. Mandalorian. It's not my Netflix queue, it's my Disney queue. I'm just like, eagerly awaiting each episode of Mandalorian, which is interesting because I'm not a big Star Wars fan, but I love that show. It's imaginative, it's creative, it's kind of melancholy. It's-

Stephanie:

I actually don't know that one. I need to check it out.

R.J.:

I'd recommend it, and I'm excited about that show.

Stephanie:

What age group is it for?

R.J.:

Well, they say that Star Wars fans love it.

Stephanie:

Okay, I like Star Wars, I guess.

R.J.:

Yeah. But like my eight year olds' buddy Charlie was like, "Man, that's my favorite show." So it also not only 40 year old men, but eight year olds like it. So it's a family favorite.

Stephanie:

Big range. Good. So they did well creating a show for all overall.

R.J.:

Yes, yes.

Stephanie:

Good. What topic or trend do you not understand today that you wish you did?

R.J.:

TikTok.

Stephanie:

Yeah.

R.J.:

I don't understand TikTok.

Stephanie:

I've gotten that answer a lot.

R.J.:

Yeah, I don't understand it. It feels very voyeuristic and it feels... I'm all for fun, but for whatever reason, it just doesn't... I don't understand why you would spend hours rehearsing a dance, for example, and then take a video of yourself doing a sort of ridiculous dance.

Stephanie:

I feel like your kid is probably listening and it's like, "Dad, anyone who says 'I'm all for fun' is not fun." If you have to start a sentence that way, you might not be all for fun.

R.J.:

I think you're right.

Stephanie:

Yeah. But I have had a lot of people say they don't understand TikTok.

R.J.:

Yeah. I think it's the age group.

Stephanie:

But that would be an interesting data set to pull in data and see what's engaging from there, because I have also had a lot of people say it converts really well and that there's a lot of [inaudible] that platform.

R.J.:

Yes. Yeah. We've got customers who use our data on Snapchat, but we've not moved into TikTok just yet, but it is interesting to see what trends might apply there. I think that again, personally why you do that, I feel like that's like a PhD or something that I could do is like, understand the motivation there or something. I don't know.

Stephanie:

Yeah. Well, you let me know how that research goes. We'll bring you back for your PhD on TikTok. What is a favorite book on business or creativity, or just one that you refer back to quite often?

R.J.:

Hm. My favorite author is a British author named Julian Barnes, who I love. I often try to not read a bunch of business books. I mean, I find some of them to be really good, but I like to look outside for inspiration, so I'm a big fan of Julian Barnes. His books are really creative and strange and weird, and he's a well-known British author but maybe not known as well in the US.

R.J.:

Then on the maybe non-fiction side, I read that book Evicted, which is again, not a business book, but just in regards to kind of some of the social issues we're after, I find that Matthew Desmond's book is really, really good as well. But I look to those for inspiration or to kind of take my brain outside of business.

Stephanie:

Cool. All right, and then the last one, what's up next in your travel destinations when we can travel again? Where are you and your family headed? Or just you if you're like, "Peace, family."

R.J.:

I don't know that my wife would be okay with that, but we actually had the good fortune, we went out to Idaho for about five weeks this summer and rented an Airbnb and loved it, and we want to go back.

Stephanie:

Where'd you go? Because I was just looking at Coeur d'Alene, which I think is in Idaho.

R.J.:

Yes, yes, yes.

Stephanie:

It's really pretty.

R.J.:

We were in Driggs, Idaho, which it's on the west side of the Tetons, about an hour from Yellowstone, and it is beautiful. I mean, it was wonderful and we're going to go back. We had all sorts of international travel ideas that my wife and I wanted to do with our kids, but I mean, we just had such a nice time out there that want to head back this summer and spend some time out there exploring the mountains.

Stephanie:

Oh, that's great. I want to check that out too. Idaho is such an undervalued area. No one talks about it, but when I started looking at the pictures, I'm like, "This place is pretty, come on people."

R.J.:

It is. It's wonderful. Yeah, it really is.

Stephanie:

All right R.J., well, it was a pleasure having you on. Where can people find out more about you and Pattern89?

R.J.:

Sure. Yeah, just Pattern89.com or I'm on Twitter @rjtalyor and would love to hear from you, or come on to Pattern89.com and check us out.

Stephanie:

Awesome. Thanks so much.

R.J.:

Thank you.

How Stitch Fix Relies on Data Science to Build the Perfectly Personalized eCommerce Experience

info@mission.org (Mission) — Thu, 31 Dec 2020 08:00:00 +0000

Style is a very personal part of what makes someone who they are. The way you dress is a reflection of who you are or who you want to be, and what speaks to you may be totally foreign to the next person. Knowing all of that, it’s understandable if you believe that something as personal and experience-driven as style could never be boiled down to data points or plugged into an algorithm. But… you’d be wrong.

At Stitch Fix, a combination of human stylists, powerful A.I., and behind-the-scenes technology has created a winning model that delivers a personalized online shopping and styling experience straight to clients’ homes. A powerful data science team is one of the key reasons that Stitch Fix has been able to launch its valuation into the billions. Stephanie Yee is the VP of Data Science at Stitch Fix, and on this episode of Up Next in Commerce, she explains all the ways that data and technology are being put to use to create the best customer experience possible.

Stephanie describes how technology like GPT-3 is going to finally make seemingly unimportant data consumable to a consumer audience, and she explains how an event like COVID-19 can impact your backend models and what to do to adapt in that situation. Plus, she gives tips on how any ecommerce operation can go about building a data science team, and the soft skills to focus on when hiring talent.

Main Takeaways:

Asking the Right Questions: The most important skill a data scientist can have has nothing to do with technical prowess. It’s about having the ability to frame a problem and then ask and answer the right questions. Encourage your team or new candidates to pump the brakes and reevaluate the “why” behind the question they are trying to answer or the problem they are trying to solve.
Making The Indecipherable Easily Digestible: With the shifting demographics, and older generations now becoming more comfortable shopping online, tools need to be created to ingest and answer long-form questions in a way the consumer connects with. Technology like GPT-3, which is the most advanced language model to date, has the ability to do just this. Tune in to hear how!
The Quick Change: Deploying algorithms and A.I. in conjunction with human resources/industry experts is critical for organizations to be able to adapt to big changes in a market. COVID-19 had a drastic impact on models that were trained on pre-COVID data. Should you scrap your current model and start over? Or build on what you have? Stephanie says a little bit of both.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie Postles:

Welcome back to Up Next in Commerce. This is your host, Stephanie Postles, co-founder of mission.org. Today on the show, we have Stephanie Yee, the VP of data science at Stitch Fix. Stephanie, welcome.

Stephanie Yee:

Thank you. I'm excited to be here.

Stephanie Postles:

Me, too. I know it's going to be a good interview when there's two Stephanies, but I'm slightly worried about how the transcript will look. Like who's saying what? Who sounds smart? I'll just take all your quotes and pretend they're mine.

Stephanie Yee:

Perfect.

Stephanie Postles:

So tell me a little bit how long have you been at Stitch Fix for?

Stephanie Yee:

I've been at Stitch Fix for almost four years. Yeah, four years in January.

Stephanie Postles:

Well, tell me a little bit what does the role of the VP of data science look like day-to-day?

Stephanie Yee:

Yeah. If I have to think about it, being the VP of data science, it really comes down to maximizing the value that the data science itself and the team can bring to the company, like how do we really get the full promise of an algorithm's approach to things? I think as you guys probably know, Stitch Fix is really thinking about how do we help people find what they love and how do we use data science and human expertise to do that? So the types of things that I think about in service of that are things like what are new opportunities that we haven't really discovered yet? And that's been pretty exciting over the last four years.

Stephanie Yee:

I think another area that I think about a lot is like what's the right almost interface between data science and data scientists and the business partners. So this is if we have data scientists working with the design team, or the product team, or the marketing team, or even executives, what's the place where data scientists can contribute the most? And also, just being really intellectually honest, like what's the place where it makes sense for others to take over? And then obviously, the last part of my job is to really create an environment where the team can be motivated and fulfilled in doing things that bring out the best to each of them.

Stephanie Postles:

That's great. So it would be great to dive a bit more into Stitch Fix. I know what it is because I'm a customer, but I think a lot of people may not know exactly what it is or all the things that go on behind the scenes to get the pretty box on your door. So could you explain what it looks like, what is Stitch Fix from a high level, for anyone who doesn't know, and then what goes on behind the scenes to create the company that it is?

Stephanie Yee:

Yeah, so Stitch Fix is a personal styling company. And at the core, we use both data science and real stylists and their expertise to help people find what they love. If you think about unpacking that, it's really about understanding... or from a data science perspective, it's really about understanding a client's needs, as well as being able to set the stylist up for success. The core of Stitch Fix, the way that it shows up is in a box of one or more items and clients are able to try it on, they're able to send back what they don't like and really just keep what they really love.

Stephanie Postles:

Tell me how do you go about making sure that you give the customer the exact outfits they would like or refine that process to where maybe the second or third time you've nailed it? Because for me, at least when I am getting the outfits, I'm like, "The first time, maybe like one thing was off or something," but then after that, it's like, "Okay, now, this stylist knows me, or this algorithm knows me." So how do you refine that behind the scenes?

Stephanie Yee:

Yeah. I think that that's a great question. I think a lot of it... I mean, as a data scientist, like I always think about the data that we collect and what's available, and this comes both from what clients tell us as well as what we're able to infer, so a really interesting example of this, and this is where you had mentioned like, "Okay, there might be one item off at first and the algorithm really learns over time," we really think about things in terms of the ability to say like, "Okay, what data do we have now?" And with the stylist, the stylist is incredibly important throughout the client's life cycle. With the stylist, like what's the right thing to be sending right now? And in response to feedback like, "Oh, that item that didn't really work out for whatever reason," we're able to respond to that.

Stephanie Yee:

I think a really interesting example of the approach that Stitch Fix takes, or rather one of the interesting things about Stitch Fix is that we're thinking about this and we're thinking about a purchase experience in terms of soft goods. So if you think about the way that ecommerce really started off, or at least as I recollect it, it was like comparison shopping sites where you were looking at like how many megapixels do you want in your digital camera. And a camera, those are very easy to compare because it's like, "Oh, it is three or it is four." Whereas with what I think of as soft goods, there's so many different variants on like a V-neck top that it's almost a little bit overwhelming.

Stephanie Yee:

And then on top of that, a lot of the typical searching and filtering is not really going to get people there, just because what might be a great top, even if it's the same aesthetic, what may might be a great top for you might be not as great for me or vice versa, just because it's like, "Oh, you know what? I really need things that are machine washable, or I have very narrow shoulders or something like that." So Stitch Fix is really trying to distill a lot of these things that are ultimately very difficult to categorize into what we would call a latent space, but really to say like, "Okay, we have something like style." Style is not what lunch table did you sit at in high school, it's really a form of self-expression. And because people are so different, we need to be able to use data science to quantify where people are on a spectrum versus what category they're in. To handle this like-

Stephanie Postles:

How do you even encourage people to get maybe the feedback that matters? Because I'm even thinking like if I were to get a shirt and I'd be like, "Well, it doesn't fit," I know you're probably behind the scenes like, "Well, why? What part doesn't fit? What don't you like?" How do you encourage someone to tell you what you need to know to then send them something better?

Stephanie Yee:

Yeah. That's a great question. So what we found, I think that the motivation to give us feedback is actually just an inherent part of the service. I think a lot of people they'll like... When I've styled people and maybe I've missed the mark, people will say, "Oh, you know what? You didn't get it right the first time, but here's more what I was looking for." If you think about it as a relationship, it's not a transaction where you walk into the store and you say like, "I'm happy or I'm sad." It's relationships and relationships are predicated on that back and forth. So it's really a phenomenal percentage of clients that leave feedback on a fix. It's something like 85%.

Stephanie Postles:

Wow, that's great.

Stephanie Yee:

It's just like an intrinsic part of the relationship just because we do frame it as a relationship.

Stephanie Postles:

Yeah. I think having that stylist there really is what forms a human connection, where you're like, "Well, this is..." Of course, there's a bunch of machine learning and algorithms behind the scene, but there's a face here, a human who's actually approving this style and making sure it's perfect for me. And you instantly feel that connection and you don't want to let your stylists down [crosstalk] get that feedback.

Stephanie Yee:

Exactly, exactly. And similarly, the stylist doesn't want to let the client down. So there's that level of trust that gets established. And from there, I think, a lot of the desire to say like, "Hey, this had a fit issue for me because it was too long or something like that." There's just something that's special there inherently. And then on top of that, we obviously do encourage clients to give us feedback, like we'll give them a nudge. But we're certainly not the type of company that has to like... They'll come to us rather than us having to really force the issue, will say.

Stephanie Postles:

Yep. What are some of these subtle nudges that you give that aren't annoying, but then encourage the person to give you the information you need to help them. I think a lot of brands struggle with that, where they either don't follow up at all sometimes if they want feedback, or they do it too much and you're like, "Whoa, chill." How do you guys get that right blend?

Stephanie Yee:

I think that there's two parts to that. One is saying like, "What's the right number of times to be asking or to be reminding really because it's less on asking?" It's just more like, "Hey, if you want, you can leave feedback and there's someone on the other end who's going to be really thinking about it and responding to it." I think it's figuring out like what's the right time to tell people, and it's really like when would this be relevant to someone? I think that there's some other aspects where it's like what's the right time of day to reach out to someone? And all of these can be distilled down into data science problem or data science opportunities. I really find that to be really interesting. I think that there's another aspect, which is that the clients do come back to the app and come back to the site, even without looking to transact. Once they're there, then it's possible to be like, "Oh, by the way, did you want to..." Just making it really easy and lowering friction to giving feedback. That's another way that we're able to implicitly encourage it.

Stephanie Postles:

Yep. So with all this feedback coming in, it's a lot of natural language that you're probably getting, or is there any tech that you're excited about right now to help you categorize it? Are you looking into GPT-3 or anything new this year that could help solve that problem when people are just giving you probably long paragraphs of like, "Here's the things that aren't working for me," and they're just putting in terms that you're like, "Okay, I can actually build any database at this."

Stephanie Yee:

Yeah. I think it's interesting because I think some of the unstructured texts or data generally that might be, I would say, overwhelming to someone like you or I. Computers are actually quite good at processing it. So I think GPT-3 is really incredible, sort of advanced in the way that we're thinking about the opportunities that come from natural language processing. So I think the team is really actively thinking about like what's the right way to bring that into the client experience? We certainly want our stylists to continue to be proactive and like a central part of that relationship. And we're actually trying to figure out like, "Okay, how can we actually bring the stylist forward even more?" But I think the way that I would look at it is I actually love it when there's a large corpus of data, will say, just because there's quite a bit of things that one can infer or pull out of that that would be otherwise a rather arduous task for a person like you or I.

Stephanie Postles:

That's great. Earlier, you were saying that the team is looking at how to maybe utilize GPT-3. And it can be for the overall industry, not just Stitch Fix too. Is there anything where you're like, "I could see this really impacting ecommerce in this way," because that's the one area that I've been trying to look into it? I can see all the things that you can do with it, from not having to code things and writing books and stuff. How could it actually impact ecommerce or data science or behind the scenes?

Stephanie Yee:

Yeah, I think that's a great question. I would say that if you think about... GPT-3 is a really great way to translate information into the format that people are used to absorbing information in, which is text. I think that it's especially important going back to the like you can't take a shirt. The specs of a shirt are not particularly helpful to a shopper. They can be helpful to a computer, but it's like, "Okay, the sleeve is 13 and a half inches, like who cares?" And GPT-3 is able to almost add in a way that would have been incredibly difficult before. It's able to translate some aspects of an item into what that actually means in someone's everyday life. So it's not like, "Hey, we could show you a table of information where it says, 'Here's the sleeve length.'" But it can be more like, "Oh, you know what? This shirt is going to hit your elbow and it's actually going to drape a little bit."

Stephanie Yee:

And because there's so much clothing out there and it's all slightly different in its own way, even if it's once again, the same aesthetic, same color, everything, we're able to bring that to the fore for a massive amount of inventory. So that, I think, gets me really excited. I think another thing that's really promising about something like GPT-3 is it'll let us... yeah, it'll really let us customize an experience to a client using a format that... and move beyond tables of data into information that might be more relevant or easier to absorb.

Stephanie Postles:

Oh, that's great. Yeah, that takes it to a whole new level. I think about right now when I'm shopping around and it shows, "Okay, there's this model and she's 5'9 and 135 or whatever it is," I'm like, "Okay, I could see maybe how something would fit if that's like a similar person to me." But that takes it to a whole new level and saying, "All right, Stephanie, this is going to be bad, you get your elbows and it's going to be very short on your waist," and just putting it in a contextual term where I'm like, "Oh, it's fixed. You all know me. Thanks for letting me know."

Stephanie Yee:

Yeah. And if you think about style and aesthetic, there's almost something... Style is a form of self-expression. And describing style in terms of only numbers is quite limiting. If you look at the way that people will describe clothing, and it's always really interesting to say like, "Okay, fashion week happened. What are they saying about what's being shown?" It almost becomes poetic in that level of abstraction. And I think that that's something that that language is much better at doing, or images even are much better at doing than just numbers and texts.

Stephanie Postles:

So the thing I was just thinking about... I mean, you guys have all these models running and algorithms behind the scenes and you have really large amount of data. How have your models changed? I'm thinking about like pre-COVID models, [crosstalk] probably around work and work clothes, and I want to look nice and heels. And then now, it seems like all those models probably had a big shake up because now it's, "I want athleisure and I want sweat pants and comfy hoodies." How have you guys models changed and what are you doing to adjust them, or what should brands be thinking about with adjusting their historical models that are probably wrong?

Stephanie Yee:

Yeah, I think that's a great question. It was funny actually. In April, one of the data scientists posted in Slack and he was like, "Oh my gosh, like all of the experiments that we're running, we're just going to have to start over." I think that there was a lot of stress behind that statement. And obviously, we're not starting over, but we're starting from a place where the data has changed. And the really wonderful thing about an algorithm and about being able to really take advantage of technology is that they can adapt much, much faster than a person. If we only had the styling team, it can take a little bit of time to figure out like how do we... If we're learning something about like COVID trends, how do you train a team of thousands of people to be on top of everything that is there, in addition to letting them style each client individually?

Stephanie Yee:

So what's really wonderful... and COVID was a fascinating situation because it's like, "Okay, all of the..." There was a tremendous amount of work that had to be done to say like, "Okay, given a pretty big step change in the way that both like the world writ large as well as the way that people are thinking about shopping and shopping online, how do we adapt things to that?" So there was quite a bit of work to do that across the board. And then on top of that, it was easier than it would have been if we hadn't taken a data science approach, just because so much of the models are designed to change. Some of our algorithms they'll be like, "Okay, this is just going to be updated every week just because it needs to be."

Stephanie Yee:

I would say that in terms of COVID specifically like... And a lot of it, we're sitting there and we're saying like, "What are people like?" We'll have conviction in where we think that the market is going. With COVID, it was like, "Okay, you know what? Everyone can anticipate. If people have to stay at home, then they'll have to work from home and maybe they won't feel a need for as formal closes as they normally would." But what was interesting, and this is just from how things unfolded from a data science perspective, we actually had... One of our data scientists was a former epidemiologist. So when we were trying to figure out like, "Oh gosh, the world has changed, like how much merchandise should we buy a year from now," she was actually able to contextualize a lot of the news.

Stephanie Yee:

As a company, we were able to come to what ended up being a pretty reasonable, I would say, assumption about the world and then to go forward and say like, "Okay, overall, how much should we buy?" And then within that, it's like, "Okay, how are consumer tastes going to change?" We can lock down that merchandise. I think the merchant team did a really great job responding to that. Within that, we can make sure that the clients who are looking for working from home clothing versus something else they can actually get it. I think in terms of general trends, I think it's like a 10X increase in requests for working from home clothing. Definitely, a shift out of formal work wear and into more like casual and everyday styles.

Stephanie Yee:

I think athleisure, those purchases have accelerated quite a bit. With Stitch Fix, because we sell actual items, the merchant team had to do a tremendous amount of work to really anticipate that. And then the styling team is able to make sure that those items get to the right people. Because if suddenly we started to only send out leggings, that's not really going to work for many of our clients who just need to make sure that the people who are looking for athleisure can get it.

Stephanie Postles:

Yeah. That's so smart having someone who understands that industry. I feel like there's more room for brands to partner with industry experts like that to help them build their models. Because oftentimes, it seems like everyone is so focused on just, "This is our company model. Only the executives of the company can figure out what the future looks like." But by tapping into someone who has very different experience, [crosstalk] maybe what's happening, it seems very smart.

Stephanie Yee:

Yeah. One of the things that I find to be really fascinating and amazing about Stitch Fix is the way that the executives... like for executive decisions are able to take advantage of the data science capabilities that we've built. And you almost get to this like the core question here, and this is almost... it gets existential, like is how do you handle uncertainty? For me, I'm like, "Okay, this is why I want an executive with like 20 or 30 years of prior experience because some of these questions are genuinely hard."

Stephanie Yee:

I want to arm them. Given the data available, the task of a statistician is to really squeeze out as much information as possible and to say like, "Okay, guys, here's what we can know, here's what we can't know. And the part that we can't know, to the extent that it's incredibly important to have a decision or a point of view on that, that is truly human judgment." So the executive version of that, I find to be really interesting and there's many versions of that throughout the company with the stylist, with the product team, with the marketing team, with the merchandising team, everyone.

Stephanie Postles:

That's great. So when thinking about updating the models and algorithms, would you suggest that a company rebuild from scratch, or should they update a current model to kind of pivot a bit? Because I guess when I think about updating a current model, I worry that there's so many things built into it after the fact and the algorithm just runs away on its own and people are like, "I don't really know what's driving it anymore," versus starting over again.

Stephanie Yee:

Yeah, I think that that's a great question. There's a couple of different aspects to it. Generally, we'll think, "Okay when you have a..." because a model is really expertise in how to use data. So if you find a model that seems to fit the world very well, then you will want to continue to improve it. If fundamentally the world responds quite well to a random forest, or we get very good predictions out of a random forest, then there's no need to change it just because, but there's opportunity to improve on that. Now, with that said, as research is continuing on different methods, people are going to try different methods. But I would say that you definitely want a mix of both because it's both the method and the tuning of that. It's both the type of model that people will think about as well as the tuning of that model or adding new variables to the model or something like that that we want to do.

Stephanie Yee:

So to give you a concrete example, like with COVID, we have a demand forecast. The demand forecast is really modeling client behavior and it's really being able to give the merchandise team and the executives and the operating partners visibility into like, "Okay, what's life going to be like a year from now and how should we plan?" When COVID happened, everyone's like, "Oh my gosh, the world is very different." But what was great was we were able to say, "Okay, here's some assumptions that we have. We can update those assumptions, but we've got several years of work into the capability itself. And the great news is that we don't need to start from scratch because things have been built in a way that can adapt."

Stephanie Postles:

Yeah, that's very smart. When thinking through your demand forecast, are you guys forecasting that the world will eventually return back to pre-COVID, or do you think it's a new normal and now people are going to continue working at home indefinitely and keeping it adjusted? How are you guys forecasting the future of apparel?

Stephanie Yee:

Yeah, I think that's a great question. I would say that there are certainly things that are very large shifts and there are other things that are just probably going to stay the same. I would say that it's a blend of the two. I certainly don't think and I certainly hope that we're not going to be working from home forever.

Stephanie Postles:

Yeah, I hope not.

Stephanie Yee:

Exactly, exactly. With the vaccine coming out and just how effective the vaccine seems to be, I think that we will be returning to... There's some things that are going to fall back into place. There's some things that frankly have already fallen back into place, and then there are other things that the company is really leaning in to take advantage of, so definitely a mix.

Stephanie Postles:

Yeah, yep, I agree. Have you seen any different types of consumer buying behaviors around what consumers are expecting now that more people are at home, they have more time to try things on? Have you had to adjust how you interact or work with your consumers during this time that was maybe different than COVID or pre-COVID?

Stephanie Yee:

Yeah. I think as I mentioned, there's definitely a difference in what it is that people are looking to buy. I think another thing that has been really exciting is that I know quite a few new shoppers, people who have never bought anything online before suddenly they're like, "Oh, shoot, all the stores are closed. I now have to try this new channel." So we're seeing people who aren't even used to a traditional way of shopping buying things. I think that's been really interesting because that behavior, as you can imagine, can be quite different. So it's great that the business is able to respond to that and-

Stephanie Postles:

Yep. It seems like there's a whole new demographic market that is opening up now that a lot of ecommerce companies are going to be able to have a lot of opportunities with. I'm thinking about Stitch Fix, my mother-in-law, who's almost 70, when they came back and told me she... I had never told her about you guys and I don't think she would actually ever do that. And she's like, "I ordered from this company, they picked things out for me, it fits perfectly." And I'm like, "Are you talking about Stitch Fix?" And I was genuinely surprised, but she found out about it on her own, went forward, bought it, worked with a stylist, and got her box. It just made me think about how many opportunities are opening up with this new group of people who never were probably comfortable with buying online before. But now, they're forced to it and it's now becoming normal for them.

Stephanie Yee:

Yeah. I love that story. That's wonderful. I think what's interesting too is that folks like your mom or my mom where they're not actually as used to buying online, they're more used to going into a store, so they're actually more used to being able to talk to someone. Whereas like my friends are like, "I don't want to talk to a human being."

Stephanie Postles:

Yeah, don't call me. Don't look at me.

Stephanie Yee:

Just text me. Right. Don't leave a voicemail, that doesn't work. Right. But the folks who are trying something online, they're used to a store. And Stitch Fix like the gap between some of these department stores where you do have a person and the department stores online presence is quite uncomfortable. So if you have Stitch Fix, obviously you're not in the store, but you get to try things. You get to work with a person, you get someone who's actually there to help you. I think in some sense, it's actually a more natural entry point, especially if folks aren't used to the current paradigm of shopping.

Stephanie Postles:

Yeah. How would you advise a company to be able to not only continue to focus on their traditional consumers that they're used to, but also lean into that new group of people because it seems like you would have to have very different messaging? Like you were just mentioning, some people like myself and you are like, "Just text me, do not leave me a voicemail. Don't try and call me, I'll decline it," whereas this group, you have to have a whole different mentality. Your customer service team probably needs to start calling people and doing things very different. How would you advise a company thinking about this, who wants to maybe connect with both of them, their current customers and the new ones who are now coming on the market?

Stephanie Yee:

Yeah, I think that's a great question. So the way that I would think about this is, first off, you have to come up... Let's take the messaging example. You want to think about what are the different messages that are going to be resonating with consumers? And then the second is how do you get the right message to that consumer? In terms of what will resonate, I firmly believe... There's a very interesting opportunity for interaction between design and data science and user research and things like that. Data science can contribute, but ultimately the messaging strategy is one that is the overall messaging strategy. You can try many different variants, but the overall strategy is one that is a judgment call.

Stephanie Yee:

And then machine learning is wonderful for being able to say like, "Given this message, or given this client and given a universe of messages, how do I make it so that the client can see the most compelling one and really understand on their terms what it is that we can offer?" I would say this is an area where you definitely need both art and science because messaging is so incredibly important and strategic. So it's working with the marketing team, it's working with the design team, and then the data scientists can really help figure out where should that message be delivered? How should it be delivered? What is the right way to make it land with the client?

Stephanie Postles:

Oh, that's great. So we're putting together this end of year commerce article about 2021 trends. And this is one thing that we're talking about is how much the over 55 demographics spend. And they spend twice as much as millennials. And I think I saw, let's see, 10,000 baby boomers are going to turn 65 every day until 2030.

Stephanie Yee:

Oh, wow, okay.

Stephanie Postles:

And then by 2050, the over 60s will account for 20% of all people globally. So when I started seeing these stats, I'm like, "Whoa, more people need to focus on this demographic." Oh, and then another one, the 50 and older crowd has a lot of spending power. And if you put it in terms of GDP, it would be the third largest in the world.

Stephanie Yee:

Oh, wow, okay.

Stephanie Postles:

US is 21 trillion, China's 14 trillion, and then Japan is 5 trillion. And this is where the people they spend 7.6 trillion in 2018. To me, I'm just seeing all these opportunities that are being missed right now. I'm like, "What the people be doing?"

Stephanie Yee:

Yeah, no, I think this is a wonderful group of folks. Within the tech industry, I would just say especially there does tend to be a focus more on millennials and things like that. I think the great thing about Stitch Fix is that we are... And oftentimes I think some brands they'll sit there and they'll say like, "Oh, our target demographic she is between 25 and 39. And after that, she's not us." I think with Stitch Fix, we're able to say, "You know what? We're not going to categorize you into one group or another, we're going to serve you where you are. And with personalization, we are able to..." I completely agree with the stats or the information that I have on how that generation of clients interact with Stitch Fix is very, very consistent with some of the numbers that you had described. So it's a really wonderful group of people who are thinking about their personal style, and I do agree it's folks who, I think, tend to be served a little bit differently, really at the retail industry's loss.

Stephanie Postles:

Yep. Yeah, I agree. How would you go about getting the right data to then be able to craft the personal message then? For Stitch Fix, it does feel a little bit easier because you can ask things like age and a bunch of other questions and they're like, "Well, they're styling me." But for a lot of other brands, if you were to ask age, they'd be like, "What?" How would you advise other companies to be able to get enough information to then be able to personalize a message like that?

Stephanie Yee:

Yeah. I think that there's a couple of different ways to do it. And a lot of it really is around the marketing and design toolkit. Because ultimately, when you're coming up with messaging, you don't want to say like, "Okay, this is the messaging for folks who are 50." I'm an old soul, so maybe I'll just really respond to that myself. A lot of this is just a strategic question. So data science can play some role where it's like, "Okay, based on what we know, people tend to respond to X, Y, and Z." But really, if you want to be looking forward, it's less like what've people responded to in the past?" You definitely want to take that into account, but it's more like where are things going in the future, especially at a time when things are changing so rapidly?

Stephanie Postles:

Yep, yeah. That's why I'm also excited about being able to ingest the sentences that people are asking the customer service reps or putting in the search bar because I think that alone could tell you who someone is just based on how they say [crosstalk 00:32:09].

Stephanie Yee:

Oh, absolutely. Absolutely. Yeah, I agree. I think that the notion of being able to have more conversations with people is something that I think is incredibly exciting and it does allow for a level of, I would say, flexibility of expression, especially once computers can really respond to that.

Stephanie Postles:

Yep. So when thinking about building up a data science team, what are your first steps? How would you tell a brand to think about it to be able to build it up in an efficient manner, where it's answering the right questions, you have the right goals in mind? Because when I think about data science from different companies I've worked at, some people are called data scientists when they're really a BI team [crosstalk] called data scientists. And then you have marketers who are also data scientists. So like how do you [crosstalk 00:33:26]?

Stephanie Yee:

It's certainly become a loaded term. It's funny because in recruiting, it can be incredibly frustrating like, "Well, this LinkedIn search is not very helpful." Yeah, that's the first thing that I would say is if people are thinking about like I need to build out a data science team, searching on the term data scientist is probably not going to be the most efficient way to get there. I think probably the step one that I would advise people to do is to really think about what role do you want data science to play and where are the areas that you see as high value? And this can be a little bit of a hard question because without... in the same way that I'm not a 100% familiar with a merchant's toolkit or a designer's toolkit.

Stephanie Yee:

If I, as a data scientist, look at a problem, I can be like, "Oh, this is something that can be very easily solved with the machine learning." It's hard for folks who don't have that background to know that, but really thinking about like what is the strategic problem that people are trying to solve? With data science, I'm very supportive of making it like a core... like figuring out how to have in-house data scientists focused on the core problems of the company. So it's like what are the core problems of the company? What role would you want data scientists to play within that? I think one of the things that's wonderful about Stitch Fix is that data scientists are really expected to take a leadership role. And this can be incredibly exciting for some folks and it can be just not really interesting to others.

Stephanie Yee:

So figuring out like, "Okay, if you want data scientists to play a strategic role like, A, what's the core of your company, B, can you hire people who are inclined to really step up and to contribute to that strategy, and then C, how do you set them up for success," I think... And when I've talked to companies, some people will say, "You know what? We're really about logistics." And it's like, "Oh, actually, there's a subset of data science," where they're really thinking about operations research, they're really thinking about warehouse efficiency, supply chain and things like that.

Stephanie Yee:

And if people are really thinking about demand forecasting and logistics and fulfillment, that's a great tack to go for Stitch Fix. A lot of it is around the warehouse and the fulfillment side of things, those folks who are doing wonderful work and it's all in service of a very specific type of client experience or being able to provision a specific type of client experience. So we have folks who are working on the warehouse side of things, but then we also have folks who are really thinking about like, "How do you work with a stylist to help people find what will really help them or what will really bring them joy?"

Stephanie Postles:

I got it. If a company doesn't really... They know some of their problems and they know their operations, but if they don't know data science, how would they know what they can solve, or how would you recommend, like should they go and talk with the company or a mentor or advisor who understands that area to do just what you just did with me of like, "Oh, of course, you can put it in logistics and you can put it on your website or here"? How would you tell someone to move forward if they don't know what they don't know?

Stephanie Yee:

Yeah. If you tell me what is most important to your business, then I can help you figure out like what are the data science opportunities there. And sometimes data scientists may not be the most important input to that, at which point then there might be alternative areas to invest.

Stephanie Postles:

Yep. What kind of skills would you be looking for when you're hiring a data scientist team, or what are some of the emerging skills too that you're like, "We weren't looking for this four years ago, but now it's something that's very much in demand"?

Stephanie Yee:

Yeah. That's a great question. I would say the skill that seems to be more and more in demand, and this is something that I think from the early days Stitch Fix had good intuition that this was important, is around problem framing. Like a data scientist, we need them to have a good understanding of statistics, oftentimes machine learning, computer programming, sometimes software engineering. But really, the core thing that we think about is like, "Can they frame a problem and can they... How do they think about problem framing?" Because what will often happen, and this is a pattern that I've seen in other places, is people will very valiantly answer the wrong question. And it's not their fault that they're answering the wrong question, it's just the wrong question was asked.

Stephanie Yee:

So what we really encourage folks to do and what I think the most effective data scientists do when they're empowered to do so is if people pose a problem to solve, it's actually okay to say like, "Okay, let's take a step back. Let's dig into this a little bit and figure out like is this posed in a way that can lend itself to the full suite of potential solutions?"

Stephanie Postles:

Got it. So if you're interviewing someone, how can you test that when you don't have much time with them? What kind of questions can you ask to see are you able to actually ask the right questions to figure out what the problem is without going down the wrong path right off from the start?

Stephanie Yee:

Yeah. That's a great question. Oftentimes there's two ways to do that. One is to say like, "Okay, tell me about a time when someone has posed a very vague business problem and how did you think about refining what it was?" I think that that's one angle. And then another angle that I will bring to the table is I'm thinking about this type of problem, how would you help me? How would you think about it? And just really making it into a discussion because what you're really looking to assess is how do people think? And I will say interviews are not... When you only have 45 minutes with someone, or you have six people with 45 minutes each with someone, you don't get nearly as much data as you'd ever want to. So when I think about it, I just want to have a conversation and see how people think and what connections do they make. If something is framed in a way that merits revision, how do they go about figuring out what that revision might be?

Stephanie Postles:

Great. So in an industry that's changing so quickly, how are you staying on top of new trends and tech? Are you subscribing to a bunch of newsletters? Are you listening to podcasts? What do you do to stay on top of the data science field?

Stephanie Yee:

I think that that's a great question. I do subscribe to newsletters. There's a couple of blogs that I really like as well. I think Andrew Gelman is a professor, I believe, at Columbia. He has some wonderful work. Susan Athey is actually another researcher at Stanford who I think is absolutely wonderful. She thinks about causality. So this is like what actually causes another thing. And she thinks about machine learning techniques that can... One of the areas of her research is thinking about how machine learning can contribute to that field. I personally like to stay closer to some professors that I particularly admire. And then also the great thing about Stitch Fix is that everyone has a different set of passions and interests, will say, as well as a different background. So when people are coming across a lot of different methods or papers, there's a wealth of different conversations going on. So that's another great way to stay on top of things.

Stephanie Postles:

Yeah. I found it really helpful when I dive into certain trends. Like every week I'll pick a new piece of tech or a new trend or something just to see what it's about. And then I start to realize how many new things I'm being introduced to and new people on Twitter that I'm following and new ways to solve problems, like at a media company with podcasts, where I'm like, "Whoa, I never thought about using that. But now that I've read about it, I can think of 1,000 ways to maybe implement it, or I have a whole new model in place or a business model idea based on just very things that are not a part of maybe the media industry or something."

Stephanie Yee:

Exactly, exactly. I love finding metaphors in one area that tend to work in another. Being able to abstract between things is such a source of insight. I agree with that.

Stephanie Postles:

Yep. So where do you see the future of data science in ecommerce headed? How do you see that experience playing out in the next five years or so? What does it look like, or what does it feel like?

Stephanie Yee:

Yeah, I think that's a great question. I think that the future of ecommerce is really one where you have a more personalized experience. I think that as we've discussed, data science is an incredibly important input to that in being able to really fulfill on that promise. I think that data science can also help retailers make better decisions. I see a lot of promising growth on that front. I think for retailers who are particularly fulfillment or operationally focused, there's some really wonderful sort of... I think Amazon is really leading the way in the direction that that side of things can go.

Stephanie Postles:

Mm-hmm (affirmative). I see a lot of companies probably looking to this field, especially after all their models and plans started breaking last year, trying to figure out what can I get ahead of this next time? There's going to be a next time of something and how can I get ahead of that and start seeing the early indicators and maybe be able to be more agile with adjusting forecast and supply chain and all of them.

Stephanie Yee:

Yeah, absolutely. I think that that level of agility is something that I'm very proud of that Stitch Fix has. And part of it is because we're able to use data science, not only it's like, "Okay, we can update this model relatively quickly compared to others, or we can figure out how to take into account in the past but not too much," but then also in the ability to help executives think through different scenarios. Because ultimately, we can use data to do some things like we need to executive input on other things.

Stephanie Postles:

I always love a good data story. Are there any stories that come to mind that either the data shows something that was wrong or it was funny, any of your favorite data stories that you think about from time to time?

Stephanie Yee:

Yeah, I think that's a great question. The one that I find to be quite endearing is... We have this notion of latent style. And this is rather than saying like, "Oh, here's the lunch table I sat at in high school," it's where within the broader realm of style do you sit? And one of the early hypothesis, it was like, "Okay, we have this sense of the types of clothes that people will like, and we can show pictures of them. But we should figure out how to articulate this to a stylist." So there was some work done to say like, "Hey, here's a set of clothes and here's another set of clothes, named them." So you could be like, "Oh, this is casual and preppy, or this is boho and edgy or something like that."

Stephanie Yee:

We basically ask people to annotate collections of clothing based on how they would describe that aesthetic. What was wonderful in a sense was all of the... There wasn't really that much consistency between what people were saying. I think sometimes people are like, "Oh, this is a problem." I was like, "No, this is great, guys. This is actually great because it proves that there's things that are there that are beyond categorization. I view self-expression and style as of them." Ultimately, when it was like, "Okay, now we need to express a client style to a stylist," a lot of it was just like, "Let's just show examples and pictures because we don't have the words for it."I thought that that was wonderful. In my mind, it really spoke to the value that Stitch Fix's approach brings to ecommerce.

Stephanie Postles:

That's cool. So that definitely shows that consumers on your side definitely can't be used from a... You do see annotation label or dataset type of aspect because they're all going to come back with, "This is preppy. Oh, no, this is boho. Oh, no, this is athleisure," and it wouldn't really work for you guys.

Stephanie Yee:

Yeah, yeah. It does become interesting. Because if you have something that is totally fashion-forward and wild, then nobody would certainly say like, "Oh, it's classic." So there might be a cloud around things. But it definitely does speak to like where is it that people can be most effective versus pictures versus something else?

Stephanie Postles:

Mm-hmm (affirmative). All right, cool. Well, let's move over to the lightning round. Lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question, and you have a minute or less to answer. Are you ready, Stephanie?

Stephanie Yee:

Sure.

Stephanie Postles:

All right. First up, what's the nicest thing someone's ever done for you?

Stephanie Yee:

For me personally?

Stephanie Postles:

Yep, personally.

Stephanie Yee:

Oh my goodness, okay, I'm going to need the minute.

Stephanie Postles:

Yeah, go for it.

Stephanie Yee:

I guess this is tangential to data science. But there's one point early on in my career. I started my career in management consulting and management consultants are an incredibly impressive bunch, incredibly good at dealing with uncertainty. They also have a very clear view for like what makes you successful management consultant. And there was a talk that one of the partners gave that stayed with me. I think of this as nice because it was quite informative in how I viewed the world and what I can do within it. He said like, "You know what? Every place that you work is going to try to put you into a box. They're going to try to categorize you and nobody really fits into a box."

Stephanie Yee:

So it's actually okay to say, "You know what? Try to find a job where you fit closely enough into... where all of the strengths that you bring to the table match the strengths that they're looking for." But it's actually okay to say like you have quirks and you're not always going to fit into the box. I think that that was really wonderful because it was like, "Oh, I need to find a job where the way that I think about things maps really well to the thing that the company needs." And then I also need to say like, "What are the things that I bring to the table that people might be like, 'Hmm, okay, that's interesting'"? And decide like, "Is that something that I want to develop about myself, or is that something that I want to say, 'You know what? That's just a strength that I have, or that's just an aspect of myself'"? I would say that that piece of advice was incredibly generous to give as well as something that was very valuable to me.

Stephanie Postles:

Oh, I love that. I'm really glad I asked that question now. It's a new one. So I always am waiting to hear if someone's like, "Ah, nothing," or something really great like what you just said.

Stephanie Yee:

Okay, I'm glad that that worked.

Stephanie Postles:

That was good. What is a trend or piece of tech that you don't understand today that you wish you did?

Stephanie Yee:

That's a great question. Let's see. A piece of tech that I don't understand today that I wish I did. I think on my list, I've been very interested to get in a little bit more into the weeds and how autonomous vehicles work. I've read at least like what The New York Times will say about Waymo or things like that. But I haven't gotten a chance to really read up on the literature. That's definitely been on my list in part because I think it's just a very interesting problem to solve. And I actually have some friends who are working on that problem, so I can probably just ask them, but also because it's something that is probably going to transform society in the next decade or so.

Stephanie Postles:

Yeah, I agree. What's your favorite data science book that you refer back to?

Stephanie Yee:

What's my favorite data science book? The core one that... And this one is not exactly readable, but it's quite nice to reference is elements of statistical learning. I would actually say that it's... Well, for some people, it's readable. For me, it's more of a reference book. But it's this wonderful collection of information put out by some professors at Stanford. I think that it's like a cornerstone of a lot of machine learning and data science classes.

Stephanie Postles:

What's up next on your Netflix queue?

Stephanie Yee:

Right now, I'm in the middle of The Crown.

Stephanie Postles:

Okay. I've had a lot of people say that.

Stephanie Yee:

Yeah. I hadn't gotten into The Crown actually until shelter at place... I sort of been like a elapsed inactive Netflix customer on and off throughout the years. But I had heard so much about it that I was finally like, "All right, I will sit down and watch it. It's really good.

Stephanie Postles:

Yeah. I started it and I'm excited to finish it. And I heard the next season's not coming out for like another couple of years or something.

Stephanie Yee:

I know. I was just like, "Oh, I should have waited to get into it until everything is done." But yeah, I think it's like two years.

Stephanie Postles:

All right. And then my last question, which is very important, how strictly do you enforce when people are writing up the term data? Do you use it properly, like the data shows, the data show? How strict are you with your team about use the word data properly?

Stephanie Yee:

I will say-

Stephanie Postles:

Very important [crosstalk 00:52:14].

Stephanie Yee:

I notice when people use it. I noticed people's grammar, including that. There are other concepts that I will become more passionate about than grammar necessarily. I think it's incredibly important, but I think the contents, like the true content and making sure that we're precise in certain other words is probably higher priority. I generally try to take a light touch with my team.

Stephanie Postles:

Okay, you're now stickler about it.

Stephanie Yee:

I do notice though. I have to filter it, will say.

Stephanie Postles:

I think you does it right. [inaudible 00:52:56].

Stephanie Yee:

I do, I do, actually.

Stephanie Postles:

I love that. All right, Stephanie, well, this has been a really fun interview. Where can people find out more about you and Stitch Fix?

Stephanie Yee:

That's a great question. The stitchfix.com website is probably the best place to find out more about Stitch Fix. I think in terms of myself, that's a great question. I do have a side project called RTD3.us.

Stephanie Postles:

I was looking at that. What is that actually? I saw it on your Twitter, but I didn't have enough time to jump into it.

Stephanie Yee:

It's just a side project. I was at a machine learning and fraud detection company at the time. Oh my goodness, this was probably like six years ago or so, maybe seven years ago when machine learning itself was just starting to like... It wasn't anything that people knew anything about. And a lot of the vendors out there would be like, "Hey, we have this super advanced algorithm, dah, dah, dah, dah, dah, dah." I found it to be a little bit annoying that people would market it as it's too complicated, you can't understand, ours is the best. And at the time, I was quite indignant because we actually had top-notch data scientists and engineers who did actually have something that was the best, but we were still trying to figure out how to market ourselves.

Stephanie Yee:

So I was like, "Okay, I want to sit down and I want to be able to explain machine learning and some of these more advanced statistical concepts to people who didn't take linear algebra in college." Very, very smart people who just decided to study something different because it doesn't have to be as difficult or as complicated as people make it out to be. There are some things that are incredibly complicated and wonderful and elegant, but you can distill something down to something that is accessible to a broader audience. So I worked with a designer/front end engineer, and we came up with something that really tries to explain some of these core concepts and to make it accessible to people who otherwise like... others are just trying to confuse them.

Stephanie Postles:

Yep, yeah. That's great. It reminds me... I mean, it's not very similar, but have you heard of Sideways Dictionary?

Stephanie Yee:

I haven't. I want to go check that out though. That sounds wonderful.

Stephanie Postles:

That's a dictionary and it uses analogies to explain technical terms. So very different than what you're talking about, but it's helpful because if you look at... Let's see, I'll look at API. The analogy is it's like the connectors on the back of your TV. They let you plug in a device from another manufacturer and both the TV and the device know what to do next. And the connectors are the interface that lets one machine talk to another.

Stephanie Yee:

Oh my goodness, I love that. This is actually something that I end up doing at work anyway. So I'll have to take a look at that. This is wonderful.

Stephanie Postles:

Yeah, check it out. I was looking at the about and I saw that it was created by Jigsaw. I don't know if you remember that. It's a group within Google. I think it's just one of their side projects that some of the engineers built. I'm like, "This is actually pretty helpful for me to understand technical engineering type terms."

Stephanie Yee:

Yeah, yeah, no, I think t's very easy to forget like what it was like to not know something. I think that for folks who can remember that, there's a great deal of empathy there and there's a great deal of desire to help people just understand technology in general. So I will definitely look at that. That's very exciting.

Stephanie Postles:

Cool. All right, Stephanie, well, thanks so much. Yeah, we'll have to have you back around since I feel like we have a lot of things we could keep talking about, but until next time.

Stephanie Yee:

All right. Thank you. This was great.

Ecommerce Aid for Health-Ade: How Calvin Lammers Helped Build An Ecommerce Team and Generated Brand Awareness Across Channels Using Lessons He Learned at the Hottest CPG Brands

info@mission.org (Mission) — Tue, 29 Dec 2020 08:00:00 +0000

Do you drink kombucha? Do you even know what kombucha is? Don’t worry if the answer is no, you have plenty of company. In fact, various sources have put the awareness of kombucha at less than 50% for certain age demographics. Nevertheless, kombucha is big business (we’re talking a multi-billion-dollar market), and Health-Ade is right in the thick of the hunt for a slice of the pie. Health-Ade was created in a one-bedroom apartment when the founders were looking to create a product to regrow hair with the fermented tea's living culture. The kombucha liquid was just a byproduct, but after getting an offer to sell the kombucha at a local farmers market, they jumped at the chance. Health-Ade now generates more than $100,000,000 in retail sales, and is sold in 30,000 stores. But just like any brand in an emerging market, the company is looking for ways to grow even bigger.

Enter Calvin Lammers, the VP of eCommerce for Health-Ade. Calvin joined Health-Ade after cutting his teeth at some of the biggest healthy CPG brands on the market, Kind, Bai, and Spindrift, where he launched a number of new products and elevated their ecommerce operations to new heights. But when he entered the world of kombucha, he had his work cut out for him.

On this episode of Up Next in Commerce, Calvin talks through how he not only had to develop and execute content to help educate a consumer base, but also about how he had to build an entire ecommerce department from scratch. He gives advice to other brands who are facing similar struggles, including what to focus on when building an ecommerce team and what metrics to hone in on in the early days. Plus he discusses why it’s important to have a holistic view of the customer journey.

Main Takeaways:

An Eye Toward The Future: If you are building an ecommerce team from scratch or scaling up your ecomm operations, long-term planning is important. Think two or three years down the line at where you want to be and build toward that, but make sure you are not overextending or, overspending or over hiring because more is not always better. In fact, having too many resources might be crippling down the line as your organization gets into crunch time as you try to reach the next level of scale.
Go Wide, Stay Shallow: Successfully launching a new product or product line is dependent on how many people you can get in front of. Regardless of if your product is niche, the goal should be to get your message to as many people as possible, and to have that message be simple and memorable. You don’t want to overload new customers or audiences with too much information, it’s more important to raise awareness.
Small Tweak, Huge Impact: It’s not big or sexy, but focusing on small things like site load times and the checkout experience actually have the most impact in terms of ROI, so those are the things any ecommerce leaders should focus on when deploying their early resources.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone, I'm Stephanie Postals, and you're listening to Up Next In Commerce. Today on the show, we have Calvin Lammers, the VP of eCommerce at Health-Ade. Calvin, welcome.

Calvin:

Thank you. Thanks for having me.

Stephanie:

Yeah, I'm really excited to have you on. I was looking through your background, and you've worked at some of the hottest, healthy CPG brands. I was looking at Kind, and Bai, and Spindrift most recently. And so, I feel like you have a lot of good knowledge, and you're a veteran in the eCommerce world.

Calvin:

Thank you. Yeah, knock on wood. Yeah, thankfully I've been able to be a part of some really great brands. I mean, it's been fascinating from a personal level. It's also been helpful from a selfish consumer level as I've been able to enjoy some really good product as well, while working for these companies. So, I think it's definitely shifted my taste buds, I think for the better.

Stephanie:

Yes. That's great. Yeah, I just started recently enjoying Spindrifts, and my two and a half year old wants one everyday now. It's probably a bad habit that I've formed. This is so perfect California kid wanting his sparkling beverage everyday.

Calvin:

That's amazing. No, I definitely got my niece and nephews hooked on Spindrift. And so, it's always funny whenever my family send me photos of the kids taking a big sip of Spindrift. So yeah, love it.

Stephanie:

Yep, you understand then. So, with all this great background that you have, how did you land on this eCommerce path? How did you first get involved, and know this is what you wanted to do?

Calvin:

Yeah. So yeah, I mean, it's definitely been a journey. Even just 2020 as a whole but even just getting to this point, it's interesting because I always like to say that there's no one linear path to eCommerce. I feel like everybody I've talked to that's been in this space for a while, or even new to this space, they've had a different journey than mine. So different. So, going way back when, I graduated from college and was in the mid-west in Minneapolis, and worked at Target Headquarters. Obviously, knew Target, new and loved it. So, thought that would be a great opportunity. So, worked in the snacks department there for a while. Realized, not quite for me, too corporate, very big company, and wanted to... And also was in the mid-west for a while, [inaudible] Change of pace. So, was looking to get out to New York, and looking for a retail related jobs.

Calvin:

And happened upon this start up, or newer company called Quidsi, which Amazon had just acquired right as I joined, and they had multiple eCommerce sites, they had diapers.com, soap.com, and a few others but obviously, I was familiar with Amazon at the time, still pretty early in the journey but was familiar generally with it but had never worked at an eCommerce company. And yeah, thankfully landed the job at this Amazon subsidiary, and really cut my teeth in the eCommerce space, building eCommerce sites, overseeing assortments, [inaudible] overall UX layouts. Really just ran the [inaudible] And I think it was exciting because there was just a lot of, what's now proven to be, it was a really good incubation for a lot of great eCommerce minds.

Calvin:

So, is Mark Laurie who is now the CEO of walmart.com. That was his former company, before he actually started Jet. There are a number of leaders there that they were at Jet, they started their own eCommerce companies, eCommerce D2C brands. And so, yeah, it just was really great learning around and realized I loved the entrepreneurial space, the vibe, and just loved that world. And so, obviously was working on the eCom retailer side, and decided to make the switch over to the brand, and basically be that voice and leader to build out eCommerce on the brand side, and have been doing that basically ever since. And so, as you mentioned earlier, I've been able to work either at a number of great brands, doing that same thing, in building a eCommerce focus and in channel strategies for the respective brands.

Stephanie:

That's very cool. So, at Quidsi, you were mentioning that there was a lot of great leaders there that you got to learn from. What is some of the advice that you remember, or that still stays top of mind from some of the people that you learned from there? Because like you were mentioning, that was a good name there, jet.com, that's great. I'm sure there's a lot of good things that you refer back to every now and then.

Calvin:

Absolutely. So, I think the biggest piece of advice, and I still... This is how I think I view eCommerce, and what I've carried with me, is really viewing even if it's a category, or viewing... Even if it's a certain sub-category on the site, viewing that, and as well as eCommerce, there's a whole in taking ownership, and business ownership, and really just viewing it as a business leader. So, through in through. So, while you might... Maybe you're focused on acquisition, but really having a full view of how it's going to impact the overall business where that's just going to help you work cross-functionally if you're on a team or a business leader, that's going to really carry through to being more strategic with all of your decisions, all of your investments, all of your prioritizations. Just really keeping that lens on whatever you're owning at that point in time, I think is crucial, and that's just how I've carried through to at my various stops in my career.

Calvin:

And even now, we're overseeing an entire eCommerce department, it really is a true business unit within the overall company since you have your separate operations, [inaudible] eCommerce divisions that companies have their own finance department, their digital marketing component. So, really having that lens, I think has been helpful for myself, and I think in general, that's just been a beneficial way to how I viewed my surroundings in business, depending on the company that I've been at.

Stephanie:

Yeah. I think that's an important reminder about how they are their own business unit but how do you make sure they don't become a silo? Because I think I was reading in one of the articles that when you were working at Target, the eCommerce group was in a separate building, and there was two people or something.

Calvin:

Yep, yep.

Stephanie:

And I'm like, obviously that was a long time ago, and that's how a lot of companies started out but how do you make sure that the team integrates with the company as a whole and doesn't become, "Oh, that's just the eCommerce group, that work on their own."?

Calvin:

Yeah. Even now, it's still a challenge, I would say but I think it's become less of an issue, or a challenge, or a hurdle, than it was when I was at Target, or at prior companies, just again with the changing views of eCommerce as a whole. But as I said, you still need to work to be integrated and fully aligned across departments, full company. And so, I think that's where... That's the other piece, is that, that's not always the case, it depends on the company. Some companies have eCommerce as it's own business unit, sometimes it lives in marketing, sometimes it lives in sales. And so, I've had differing experience but the biggest thing is, it is whether you have those individual responsibilities, or head count in the eCommerce department, or they still live in different departments, it is one of the most cross-functional areas as well for that exact reason.

Calvin:

Because you're touching operations, you're touching marketing, you're touching finance, you're touching brand. So, there's an innate need to interact, and work closely, and be involved with each respective areas. So, I think that's where it really the whose... Any eCom leaders, or practitioners that are either starting out, or obviously, well into their careers, really making that effort to both educate in terms of why they should be caring about eCommerce, what of the benefit, how will it impact them, how will it impact the broader company and organization? And really just being that leader, and educational voice, I guess, for the company to gain that [inaudible] And sign on. And I would say that's been one of the biggest focuses at any company, is really making those pitches, and sell-ins.

Calvin:

And then, obviously, at the same time, going the extra mile to show why it is beneficial for the respective department leaders to work closely with the eCommerce team, and myself personally.

Stephanie:

Yep. So, you were just mentioning around them being a cross-functional team, and when I think about a cross-functional times, I think about, a lot of times... And I was one of these back in my earlier days. You're not always doing the work but you're there to coordinate many groups, and bring them together, whereas in eCommerce, team having to also be a cross-functional team seems tricky. So, how do you go about building up a team like that? What are some best practices, and how do you make sure you hired the right people, and build up a good team who can do both of those functions?

Calvin:

Yes, I think that's... It's definitely something that I have very recent experience with. So, I think, a lot of times... And this has been the case at previous companies as well, where eCommerce was maybe less of a focus for a brand, or there weren't as many resources put into the company, or the headcount was on the lower end of the spectrum. So, you have to be very, very efficient, and careful with how you were filling any headcount openings that you had available because that might be the only one you get for the next year, or the next budget cycle. So, it's previously been super important for that reason but even now, as I just joined Health-Ade six months ago, when I joined, there was no dedicated eCommerce team. There were shared responsibilities but there was no eCommerce team to speak of. So, very quickly had to be mindful with the roles that we were building out and filling right off the bat because again, we were building this essentially from scratch.

Calvin:

So, had to be very thoughtful and mindful about, "Okay, over the next two years, what areas of responsibility, and what departments, or what coverage do we need? And will that last us for presumably the next two years? Because we need to be hyper-efficient, and competitive with how we're proofing out the success and viability of the channel. So, we don't want to overload, and hire a 10 person department before we break six figures in revenue." So, we want to be very strategic in that. So, with that, I think that also goes back to my mindset from Quidsi where I still very much have that start up entrepreneurial mindset. So, I've worked at companies where I was the only person on the eCommerce team for a year.

Calvin:

And so, it's a lot of work. I think it's been helpful for myself, as I've touched every aspect of the business, and while I don't work in a day to day at this point, I have at least a background and knowledge of how everything works, and I think that is really important for eCommerce leaders to be able to speak knowledgeably just about eCommerce fulfillment just as much as they are about eCommerce acquisition, or marketing. I think that is hugely important. And so, that's been my mindset, is hiring people that are not the jack of all trades, but maybe a utility knife, where they're able to... Quick learners, able to pick up things very quickly. They have an interest, they're super curious. But they're open, and willing, and wanting to touch multiple things of the business and not having very narrow minds that then, "Oh, that's not my responsibility."

Calvin:

Again, going back to having that ownership view, carries through to how I view headcount, and bringing on new team members because I think that's just hugely important. Especially early on, as you're building out a team.

Stephanie:

Yep. Yeah, you have to have those scrappy individuals who are ready to treat the company as if it's their own, and ready to jump in wherever needed, even if they're on a team that maybe isn't relevant to the task.

Calvin:

100%.

Stephanie:

So, let's talk a bit about Health-Ade. So, I'm a fan of Health-Ade. I have been following it for a while. I also just love the story. I mean, I think the CEO was selling it. She started with $600, and she was selling it at Farmers markets, and now I think I saw you guys generate over 150,000,000 in revenue, and you're in 30,000 or more stores. So, I want to hear a little bit more about Health-Ade, what is it, and what drew you to the company?

Calvin:

Yeah. So, obviously, great to hear you're a fan. I am myself, I like to say that, that's been very much a part of my career path and choices where I worked at, and wouldn't be joining a company if I didn't really enjoy, or love the product, and that absolutely was the case with Health-Ade. Yeah, thankfully, I got connected with the team here. As I mentioned, they were looking to build out their eCommerce channel with really no focus, or presence to speak of before I joined. I was a big fan, it's a probiotic tea, kombucha, is their primary product line, that's as you mentioned, founders and [inaudible] Where they started out a number of years ago. That's really been the key focus for the brand, and where we've seen most of that growth to that surplus of over 100,000,000 in retail sales.

Calvin:

We obviously have looked to expand the kombucha, and recently, we just launched a new product line called Booch Pop, which is a ambient soda made with kombucha. And so, looking to expand into some of these other areas but really, kombucha still is the first and foremost, and primary product line for us. And it's been great to see obviously kombucha as a whole, has been a huge growth driver and really fast growing category, and Health-Ade has really been the primary contributor to that growth over the last few years. So, love the brand, loved what it stood for. Just loved everything about it. The unique challenge, and I think the thing that caused me hesitation was just obviously, with the kombucha product, it is [inaudible] Requires refrigeration, it's also in glass bottles.

Calvin:

So, obviously, anybody that knows anything about eCommerce fulfillment, not really the easiest things to turn into a viable eCommerce business right off the bat. So, very difficult, very, very challenging, and very costly just from an operations standpoint. So, that was definitely the biggest hurdle, or thing that gave me pause but always like a challenge. I like to say that every single brand that I've worked at, I've wanted to make more difficult. So, I've gone from snack bars, to refrigerated beverages, so gone one end of the spectrum to the other, and the food and beverage space. And that's been a big focus for us, and making that a very viable channel, and obviously just making sure that our operations and fulfillment is a strength for us, out of necessity really.

Stephanie:

Yep. Yeah, I'm definitely going to be diving into the logistics piece in a bit, so be prepared. It seems like you choose brands too that... I mean, maybe everyone say, every brand needs convincing, to convince a buyer to buy it. But you choose brands that aren't very well know. I mean, I'm thinking about Kind, when they came out. I remember when I worked at Google, they started having the bars there but people still really weren't sure what they were. Same thing with Buy, the coconut water. And Spindrift more recently, I mean there were so many sparkling beverages [crosstalk] Convincing someone of why you don't want that artificial flavor, and why you [crosstalk] I mean, it seems like you have a pattern here where you're picking harder, and harder things, and now kombucha.

Stephanie:

I think I was just reading that maybe between 20 and 40 year olds, more that 50% still don't know what kombucha is. I saw that stat somewhere and I'm like... I mean, that's crazy to me. Maybe it's because I'm in California, and it seems like everyone here knows what it is but it seems like it's a hard market. How are you going about educating people? Is that why you chose to do the soda route where it's still kind of kombucha, but maybe might connect with a whole different audience, and bring them into the network of kombucha?

Calvin:

Yeah, no, and I think that was a definite thought and factor in the development of the Booch Pop product line, and having multiple ways in for consumers. To this point, there's been... You're a kombucha consumer but that's something that we've done studies on, and have research on in terms of the overall awareness and knowledge of kombucha. It is limited, it still is not as mainstream, or widely known as you would think at this point. So, that also is impactful to how we're approaching overall messaging, and advertising, and just overall content on digital for us. So, that follows through from everything from our Amazon product pages, to our own website, to our email flows, to our SMS marketing, to influencers. So, it's hugely impactful, and I think that's been a major, major focus for us in the brand, in that we realize that there still is a huge section of the population that not only doesn't know Health-Ade, but doesn't know even what kombucha is.

Calvin:

And so, I think that, at the end of the day, presents an opportunity, and I think is what we see as the open lane for us, or opportunity for Health-Ade, is really being a leader in terms of contents and education for kombucha, and gut health overall. And so, really making that case, and driving home that education piece around what is kombucha? What are the prebiotics, what are probiotics? Why are they important? What benefits do they actually help? How does that contribute to overall health and wellness? Because what we've seen, is that, that benefit is actually, strangely enough, unlike most food and beverage categories, taste is actually a second driver. It's actually the health and benefits that is the primary driver that we are focused on.

Calvin:

So, we're really making clear why somebody should be incorporating kombucha in their daily diets, what are the benefits? And just really driving that home. That's, I think, where we see the opportunity. And so, that also relates to content and messaging. And again, you have a better ability, or avenue to do that on digital as opposed to just your traditional retailing on shelf, and you're limited to just the label, or the packaging. So, I think that actually is where it helps brands like Health-Ade, or even start up an emerging brand, so you can create more engaging, and enticing, and interactive content in messaging that really can hit home the messaging and objectives that you're trying to drive, especially as you're building awareness, and overall education for the brand or category that you're in.

Stephanie:

Yeah, I think the gut health thing is still new to a lot of people. I mean, my friend the other day just got a test done to show the bacteria in their gut, and it was really bad, the test results, where she's having to do a whole entire diet reset, and take a bunch of things out, and then, re-introduce them, and take all these probiotics and stuff.

Calvin:

It's certainly been an education process for myself because yeah, certainly, I had somewhat general awareness of good health, and probiotics, but even the amount that I've learned, being at Health-Ade for the last few months, yeah, it's a very, very important part to the overall body, and there's just so many aspects to it, that it does require a decent amount of education. So, it's a journey that we've also got to bring consumers along. It is, as much as I'm going through the same journey myself.

Stephanie:

Yep. So, are there different channels that you utilize when you're maybe going the education route, and you want to get in front of the new people, and educate them on why this a good product to try out? Especially now when they can't maybe test it.

Calvin:

Yep.

Stephanie:

I mean, I remember, in the early days of Health-Ade, there was a lot of samples at Whole Foods, or wherever I would go, that's how it came on my radar. But what are you doing now to introduce it to people, especially if they can't really try it?

Calvin:

Right. Yeah, so I think that's where we have a couple of different channels that we're focused on. So, obviously, within the eCommerce and digital purview, we have our D2C businesses, we have Amazon, our eRetailers. And then, we also have Last Mile. So, obviously, on eCom, going back to the overall financials, and build of that business, it gets very difficult to [inaudible] individual bottles of kombucha. It just overall doesn't work, the economics don't work out. So, traditionally, we sell 12 packs, which again, are quite a bit of product for a consumer who's new to kombucha, or new to Health-Ade, and hasn't tried before. So, what we've done recently is that we built out some sampler packs, so included a couple of different flavors for our different product lines [inaudible] As well as our new Health-Ade plus line, which is our kombucha with additional benefits.

Calvin:

And so, that's been our primary focus recently in driving new customer acquisition in these sample packs, or variety packs, and we've seen some really good responses mixed with that education which again, via our different channels. So, via paid social, we've tested out a few different things for longer-form content, and driving to landing pages, and that's worked extremely well where you have use [inaudible] Initial tidbits, or insights that you include in the copy in the messaging with the paid social campaigns. And then, driving to the landing page which really fleshes out more of that storytelling piece. And these are all consideration and top of funnel campaigns and tactics, and we've seen really, really strong responses to that. And so, that's been super efficient for us, and seen really good responses.

Calvin:

And then, at the same time, we also are focusing on... We have our delivery partners in Last Mile, partners like Instacart. And so, with Instacart, and these other channels, you can obviously purchase just one bottle. So, been really leveraging the ad platforms, and some of these emerging platforms as the way to drive trial where the cost to entry, or the barrier to entry is a little bit lower, just because they're just buying one bottle. And so, we've been actively engaging in working with the Instacart ad platform to promote our products on Instacart as well, and really seen some huge gains there, and see that as a really good opportunity to drive trial on individual bottles when sampling isn't an option obviously, currently.

Stephanie:

All right, so let's talk a bit about launching products. So, you have launched a bunch of new products but also, for the first product maybe in the line versus launching a newer [inaudible] Like you just did with the soda. So, tell me about the differences when a brand is just starting out, trying to get the word out there, and putting out their first product or two versus launching something very different like soda to a market who's maybe expecting just kombucha.

Calvin:

Yeah. So, I think it really goes back to, I think, overall with the roll out and marketing approach. So, obviously, with a new brand, or really establishing any market space as a whole for a new brand, you're going to go to much wider, you're going to have to go much, much shallower with the content that you want to engage right off the bat because you're trying to drag overall impressions, and touchpoints, and just top of mind awareness for that new product line, or new brand. And you're going to have to go a little bit wider spread with your focus, and your tactics that you're employing, and really going true, true top of funnel brand awareness as opposed to a new product line. With Booch Pop, obviously, this is going to [inaudible] Similar or, if you're drafting off a different category, like at Kind is probably the best example where Kind had it's original nut bar line.

Calvin:

And then, came out with the clusters, then the granola bars, and came out with a number of different product lines. And so, with that, it's different because once you establish that brand recall and awareness, you're either able to leverage that and target within that specific category, or... I think this is the [inaudible] With Booch Pop, is that even people who might be aware of Health-Ade, or again, maybe they weren't interested in kombucha, or they hadn't tried before, and we've gotten this response to where it's like, "Is it too healthy? Do we want to target some more mass consumers?" We can draft off of that brand persona and establishment, and cache, and either go super targeted within that and say, "Okay, these are the specific audiences that we want to target, and draft, and leverage that brand cache."

Calvin:

Or, if there's just general awareness, the brand can draft and go into an entirely new segment or audience, and utilize that established brand elements as much as you can. Obviously, finding that right balance and depth that you go is the... End of the day, that's the biggest question but that's, I think, the difference that I've seen in my experience and how that's been incorporated to the roll out for new product lines, and yeah, very much similar story to how that played out at Kind as well.

Stephanie:

Yep, very cool. So, let's talk logistics a bit. So, you're talking about the cold chain process, and you've got glass bottles. What did it look like when you joined and they want you to build out the eCommerce channel, what did that look like behind the scenes? And what were some of the lessons as you've been going about that?

Calvin:

Yeah. So, I think right off the bat, when I joined, I guess the biggest thing is that we were utilized... And again, because Health-Ade, like a number of brands, saw huge demand and interest in eCom and direct-to-consumer earlier this year due to the COVID surge, and it was a minimal business. And so, right off the bat, needed to get things rolling forward to meet the increasing consumer demand. So, for the fulfillment itself, really hadn't been a focus for building out what that actual packaging, and refrigeration, and insulation looked like. So, we were just using styrofoam coolers to keep the kombucha cold, and adding some ice packs, and shipping to consumers. So, not the most sustainable, or eco-friendly option, especially as we're increasing volume. So, right off the bat, that was a big focus for us, is really finding, and implementing a sustainable, and eco-friendly liner and insulation option, which thankfully we were able to get in place pretty quickly when I joined a few months ago.

Calvin:

And so, that was one of the biggest pushes for us, is obviously, just fitting with our brand, and our persona, wanted to make sure we were also being very sustainable, and mindful with how we were actually getting product to consumers. So, that was the biggest thing right off the bat. Currently, we have three different fulfillment warehouses, and so that helps us get to most consumers in two day... Or, 95% of the country in two days. But it still poses challenges because there's still that refrigeration requirement, so that limits the number of days because we don't want a product obviously waiting in trucks over the weekend or anything like that, so it limits the number of days that we can actually ship.

Calvin:

And as consumers as we know these days get more and more... Their expectations for delivery times increases. There's an opportunity to decrease the delays in delivery times with their products, and so, that's the current focus, is how can we reduce from two days to even one day, or even next day delivery? Especially, in key markets So, that's really the journey over the last six months that we've been in. And obviously, it's been a lot [inaudible] In six months, and I got a lot more to go here going into next year.

Stephanie:

Yeah, and how's the forecasting process been? Because I mean, the world's just been so crazy, and especially, leaning into eCommerce right when things are crazy, how do you go about forecasting things so that you have what you need, you don't go out of stock, you've got your variety packs? I mean, it sounds like you've brought a lot of new things to the brand but that's a lot of new challenges that'll come with it.

Calvin:

Yeah, you hit it spot on. So yeah, especially, we have no historicals, no base line to go off of, so that's... Our team has been hyper focused in really nailing down, and narrowing in that forecast, especially, we added new SKUs to the mix. So, it's really been... Thankfully, our warehouse and 3PL partners have been super, super helpful in partnering with us, in maybe over-stocking based on previous demand to ensure that we have sufficient inventory, especially if we have an upcoming promotional push, or we're leaning more on any of our acquisition campaigns. If we were just going off of historicals, obviously, if we were selling a couple hundred cases a month a year ago, to then change and go to a few thousand cases, even alone, that's a huge increase. At first glance, it'd be very tough selling with a lot of partners, or 3PLs that would take the traditional growth and forecasting route.

Calvin:

So, with that, they've been really helpful in loading, and carrying more inventory than needed to anticipate any increases. But then, on top of that, it's really staying close to the vest and staying ery, very... Being very diligent with how we're tracking it. So, we built our reporting to track by location, by SKU, on a daily basis for inventory levels. And then, if we see any risk, working quickly to turnaround shipments to get out the door, and get us back in stock. And so, it takes a village to say the least, and thankfully, it's just again, having the right partners, and really having the team be hyper diligent, and stay close to it, has really made a huge difference.

Stephanie:

Yeah, I've got it. So, I'm guessing you've also had a lot of experiences when it comes to figuring out what platform you want to choose, or re-platforming at the brands that you've been at in the past. How did you do that with Health-Ade, and how do you figure out what platform's going to work, and what kind of features you need, and how to make it so it'll convert?

Calvin:

Yeah. So yeah, the platform side's been interesting because even that's evolved pretty extensively. So, for me, at the end of the day, you want to have scalability, and also enough customization, especially early on, that you can really make the full use of any platform.

Calvin:

Long term, you want a turnkey Platform that again, can scale, integrates well with most of their channels, apps you need but you don't want a very dedicated, or customized CMS that will require a lot of heavy lift, or work whether it's on the internal team, or external party because the cost and hours are going to quickly snowball from there. So, I think that's where for us, again with a limited team, or smaller team, and especially early in our journey, that, that customization, scalability is really the biggest piece for us in deciding with platform we ultimately landed on.

Stephanie:

Got it. And what kind of metrics are you looking at after you... You've got the platform up and running, what kind of things do you look at to make sure things are going well, and how do you figure out what you want to maybe test maybe, and see how to even optimize it further?

Calvin:

Yeah. And that's a big thing for us. Obviously, there's a couple of components there. So, there's the Platform A, but then there's the overall site design, and architecture. And so, that's the biggest piece that we still have in our journey, we previously were on WooCommerce with WordPress as the CMS. And so, a lot of that is legacy content, and pages, and code that's been built there that we've evolved and tweaked it over time, before we had the eCommerce team. So, that's where we're making... We're flying the plane as we continue to tweak it, and build it, but really, that's the biggest opportunity, is that there's only so much that a platform can do without the actual highly functional, seamless UX experience for consumers. Super engaging navigation and content, that's still needed in order to best leverage and utilize whatever platform you end on.

Calvin:

And so, that's the next piece, is we've seen... We continually are looking at our conversion rates, our balance rates, our time on site, our click throughs, and the time to conversion. And that's really what we're holding as our key metrics here, to measure true success of the website before we get into consumer journey, lifetime value, and things of that nature, just the overall site experience. So, that's the biggest thing that we're trying to address, and improve now over the next few months, now that have the right platform in place. So, working with an overall site redesign, and site build, to really bring our full digital experience for the website to match our brand persona, and really bring that up to speed, and make a viable experience for consumers that really will sustain us long term.

Stephanie:

Got it. Are there any changes that come to mind that have made the biggest impact around the consumer journey, or seeing those conversions increase? Even if it's maybe starting to introduce that variety pack. What do you think the impacts have come from this year?

Calvin:

I think site load times, honestly. So, it's just something as simple as that. Obviously, a second in the digital age, or a D2C experience is a life time. So, that was a big focus just recently, just reducing page load times, reducing font sizes, page weights, image weights, all these things. And almost impacting how the page are loading. Making sure that add to cart buttons are loading first, as opposed to maybe copy further down the page. So, just those small tweaks have huge impacts just right off the bat. And so, that's really what comes to mind right off the bat, is just making sure the time from landing to checkout is as seamless and as quick possible because you want to make it as easy for customers to checkout and give as little reasons as possible for consumers to bounce. And so, I think reducing the page load times has been crucial, as well as testing out... Again, just where we're driving new customers to.

Calvin:

So, we've updated our collections pages where we drive a lot of our traffic, and just updating the layout, and the overall structure, adding add to cart buttons on the collections page. Again, just to remove another step needed to checkout. So, those minor tweaks are really what we're focused on now until we completely revamp the website as a whole, and thankfully, they've made some significant improvements, and had a marked impact so far.

Stephanie:

Very cool. So, where do you see the world of eCommerce and D2C brands headed in the next year or two?

Calvin:

Yeah, I mean, if I had $1,000,000, and wish I can do and embed on that because yeah, I mean, if anybody told me that in 2020 we would see eCommerce penetration go from the five, 6% to... I think the last figure that I saw was 11, 12% just in 2020 alone. Yeah, I would have said, "You're joking." So, who knows at this point? But at this point, I don't think we're going back. I think this is the new standard for new consumers. I think that's what I've seen, is that every consumer, or most consumers that have either been forced, or shifted purchase behaviors to online, especially in the grocery space since food and beverages still being the lagger in terms of under indexing versus other categories in eCommerce penetration, and that's changed tremendously over this year. So, I think that the consumers are going to stick with that trend.

Calvin:

So, a lot of consumers that have tried grocery delivery for the first time will likely stick with that over the next couple of years. I think it's going to be more... I think the biggest thing is that it's just going to become more seamless with... Especially, on the brand side with how they view channels, I guess. So, instead of having this prior mindset where it's like, okay, there's brick and mortar, then there's this eCommerce thing, and they're separate channels, you need to be mindful of the entire customer journey because yeah, you might have a consumer that you have a programmatic ad that they get started with, and then, they're purchasing in store. Or, they see a programmatic ad, and they're purchasing on last delivery, or maybe they're in store, or buying a pick up order, or maybe they're ordering via an SMS channel.

Calvin:

So, I think it's just becoming more holistic with it's not a matter of channel separating but having a true, unified vision of that customer journey, and approaching that as such as a company, and a brand, and that's very much what we're thinking off as we're building out our collective efforts at Health-Ade.

Stephanie:

All right. So, how are you guys prioritizing retail versus eCommerce? Where are you investing right now? Are you pulling back a bit from retail, and learning more into D2C, or how are you thinking about that?

Calvin:

Yeah. So, I think that goes in line with my previous comments. So, we're absolutely still supporting our retails channels since as I mentioned earlier, that is where the bulk of our business is currently but we're also changing in how we're activating and supporting those retailers. So, maybe traditionally, or previously, we might be supporting retailers in on shelf, or POS material, instead we're running geo-targeted display ads, or paid social ads, or running a programmatic display campaign to support a specific retailer. So again, just leveraging more digital components as well as supporting the last deliver, or Last Mile platforms like Instacarts that still... Obviously, the revenue in volume is being pulled through the retail stores.

Calvin:

So, it's definitely not a shift of focus, or priority, or in an investment, it change in terms of how that support is played out, I guess. So, that's, I think really been the biggest change for us. And then, on top of that, obviously [inaudible] that support from the eCommerce piece, and how that plays into the mix. What I've also seen at previous companies, and a number of white papers, and research that I've seen, is that any eCommerce advertising, or digital advertising, it will drive eCommerce, and it has obviously a huge impact on eCommerce specific sales but a lot of the impact is actually seen in your traditional brick and mortar, or retail sales. And so, having that lens, and that... If you're spending a dollar for eCommerce advertising, it doesn't mean that entire pack is going to eCom, it is also driving the overall brand awareness, and retail sales.

Stephanie:

Yep. Yeah, which is definitely a tricky thing to measure, and then try and convince maybe [crosstalk] It's having brand awareness, and it's also driving those retail sales but I can't exactly track it right now.

Calvin:

It's the age old debate. Yeah, I've been there all too many times. That's a fun one.

Stephanie:

All right. So, with a couple minutes left, let's move over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question, and you have a minute or less to answer.

Calvin:

Oh, man.

Stephanie:

Are you ready, Calvin?

Calvin:

I think as ready as I'll ever be, so let's do it.

Stephanie:

All right. What's the best piece of advice you've ever gotten?

Calvin:

Best piece of advice, I guess is... Again, don't look back. Take ownership, and own your mistakes. I think you can't shy aware from your mistakes, just make sure you don't make them again.

Stephanie:

I like that, that's a good one. What's up next on your reading list?

Calvin:

Next on my reading list, I would say right now, I actually got a book that I've been meaning to get to for a while. It's called The Sympathizers, it's a historical fiction novel set after the Vietnam War, in the US. So, it's one of those that I've had on my list for a while, and it's about time I finally get into it.

Stephanie:

Sounds good, I'll have to check that out. What do you not understand today that you wish you did?

Calvin:

I would say the biggest thing that I understand today that I wish I did was just the impact to that eCommerce operations and fulfillment has, and in total business. I've said this, I think, in the past speaking to other people but if I knew then what I knew now, I would have gone back and got an MBA in logistics and supplier chains, just with how much of an impact that has on eCommerce. And again, going into it, had no idea how crucial that is to a viable eCom business.

Stephanie:

Got it. That's good, you pivoted the question which now I think I want to ask going forward because you took it in the route of what do you understand now, that you didn't understand that you wish you did. So, I like that. That's a new question I'm going to have to add in.

Stephanie:

So, if you were to have a podcast, what would it be about, and who would your first guest be?

Calvin:

Oh. I would say it would probably be about pop culture in... I guess pop culture and entertainment in the '90s, and my first guest would definitely be Conan O'Brien, I think just because in general I love just talking about pop culture, and entertainment in the '90s, and Conan O'Brien was one of... It still is absolutely one of my favorite late night hosts, and his podcast has been one of my favorites, and it's been a good one to have a hefty playlist for his podcast episodes to get through the past few months.

Stephanie:

That's a good one. All right, and then, the last one, what one thing will have the biggest impact on eCommerce in the next year?

Calvin:

Biggest thing I think will be, I guess technology at the end of the day but then, also, just again, how consumers are changing their shopping behavior. So, I've said this in other forums but previously, my biggest expectation is that integrating technology into just the kitchen and the pantry, again, speaking more on food and beverage since that's been my space, my territory. I think that really seems like the opportunity where you want... Especially, if consumers are shipping more to eCom and digital delivery, having that be less of a top of mind thing, I think, and making it more efficient and removing any legwork on the consumer side will be beneficial in the long run. So, whether that's scales that you're placing products on, so that your subscription knows when you're almost out of your coffee, and you need a refill, or anticipating based on your purchase behaviors, I think that is probably the next trend.

Calvin:

Especially, on the consumable side. That's, again, just going to remove pain points in consumer's journeys, especially when you're getting it delivered to home, that's really the biggest one at the end of the day.

Stephanie:

Cool, I like that. That is a really good, unique answer that we have not had so far.

Calvin:

Oh, great.

Stephanie:

I like it. All right, Calvin. Well, this has been very fun. Thanks for coming on and sharing all your eCommerce knowledge. Where can people learn more about you, and Health-Ade?

Calvin:

Yeah, you can find me on LinkedIn, Calvin Lammers. And if you want to check out more about Health-Ade, and read some more about that education content that I mentioned, you can go to health-ade.com.

Stephanie:

Thanks so much.

Calvin:

Thank you.

Scaling: How to Allocate Resources, Find Bottlenecks, and Enter New Markets with UrbanStems’ CEO, Seth Goldman

info@mission.org (Mission) — Thu, 24 Dec 2020 08:00:00 +0000

In recent years, UrbanStems has grown from operating its online flower ordering and delivery business in a few markets to processing and delivering orders from coast to coast. It’s a DTC success story, but it was by no means an easy road to get to where the company is now.

Scaling is one of the most challenging parts of running a business. Where do you allocate your resources? How do you enter new markets? And what do you do when disaster strikes in a way that could topple your business?

Seth Goldman had to answer those questions and more when he took over as the CEO of UrbanStems in 2017. On this episode of Up Next in Commerce, he spilled the tea on everything he learned along the way. Seth explains how to navigate through the process of scaling, finding bottlenecks in your operations, and breaks down the ways to look at ROI when trying to break into a new market. Plus, he gives some insight into best practices when adding headcount.

Main Takeaways:

Finding the Bottleneck: There is a tendency for everyone to think everything is the problem, so it’s important to use data to prove that you have an actual bottleneck rather than anecdotal experiences. With the data as a guide, you can zero in on the actual bottlenecks and fix them at the source.
Tipping The Scale: There are various hurdles to scaling. Doing it successfully is about finding the right level of balance when it comes to allocating resources. Are the current processes failing? Is there new technology that can create efficiencies? Or maybe you should be allocating headcount in a different way. Answering those questions is the best way to determine how to stimulate sustainable growth.
Welcome To [Enter City Here]: When expanding your business into new markets, understanding the ROI of moving into those cities is the first step. It’s not enough to figure out if there are potential customers. Other factors such as supply chain, cultural considerations, and non-financial benefits also need to be taken into account.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone. Welcome back to another episode of Up Next In Commerce. This is your host, Stephanie Postles, co-Founder at mission.org. Today, on the show, we have Seth Goldman, the CEO of UrbanStems. Seth, welcome.

Seth:

Thank you, Stephanie. Great to be here.

Stephanie:

Yeah, I'm excited to have you. For anyone who does not know UrbanStems, can you tell me a bit about it?

Seth:

Sure. UrbanStems is a six-year-old old company that is the premier provider of direct to consumer florals.

Stephanie:

That's awesome, and how long have you been with the company?

Seth:

I've been at the company for about three and a half years.

Stephanie:

Cool. What brought you to UrbanStems and what was your background before?

Seth:

Yeah, so it was a person actually that brought me, the founder, Ajay Kori is a dear friend of mine, and we both worked at a company called Quidsi together, which was acquired by Amazon back in 2011, and we remained very close friends from that point on. I went off to a company called HelloFresh. He went off to found UrbanStems, and we reunited in 2017.

Stephanie:

That's great. What did you do at HelloFresh?

Seth:

Yeah, I was the CEO of the US business, helping to grow HelloFresh from its near infancy in the US to a much larger business, and it was a wild ride and I had a lot of fun doing it.

Stephanie:

That's great. It seems like a good company to get a lot of lessons from, to bring to UrbanStems, like similar problems maybe, or things to tackle.

Seth:

Absolutely, both in terms of the apps, specific product, a perishable product, and a complicated supply chain, as well as I'd say the softer skills in terms of scaling a business, scaling a team and the challenges that come along with that.

Stephanie:

Very cool. When you came into UrbanStems, what was going on back in 2017, and how has it changed since?

Seth:

Yeah. When I came on board, it was great. Ajay brought me in and asked me to help beef up the operations of the company. I'd say, as a consumer, the biggest difference between now and then is that you could only get UrbanStems in a few select cities across the US at that point, and we made a big decision to go nationwide in early 2018, and that's really helped us scale the business since then. Although, we really still love our city delivery method that we still have in New York and DC. It creates that really intimate relationship with the customer and their recipient. We hope to be able to do more of that going forward.

Stephanie:

Tell me a bit about how do you pick cities? Of course, if it's started in a certain city, you're probably going to launch there, but how would you go about picking which cities to start in and having that city method that you're talking about, is developing a good relationship in that city?

Seth:

It's a pretty simple exercise of figuring out which cities are likely to have enough revenue and an ROI on that city to get in there. We believe there probably around 30 cities that we could identify today that likely makes sense. In terms of which cities we'd prioritize next, we would really rely on data. That data would help us understand what would be the revenue opportunity, how quickly we might get there. From there, we would also layer on supply chain and we would try to figure out if that city was easier or more complex from a supply chain standpoint. Finally, we'd overlay brand. We'd try to understand if there were any idiosyncrasies of that city that made it more or less attractive. Then finally, we might say, does that city have any sort of non-financial strategic importance to our business?

Stephanie:

Oh, great. Okay. This is a very interesting topic that I actually have not talked to many people on the show, so I want to double click into all of those, if you're happy to go there with me.

Seth:

Sure, let's go.

Stephanie:

All right. When you're picking your cities, you're talking about developing which ones have an ROI, and then of course, looking into a bunch of data for rolling out to the next cities. How do you go about developing which cities will have a good ROI?

Seth:

Yeah. The great news is that we have data to show what revenue we have in those cities currently. We would have to do a deep dive analysis of what zip codes we thought we could actually deliver to, depending on the city, if it's a city that we could get in with bike messengers, as we currently do in New York and DC, or if it's a city that would force us to rely exclusively on cars, which is not a major concern although we really love our brand promise of delivering via bike where we can.

Stephanie:

That's fun.

Seth:

Yeah, we would then use analytics to understand where we stand in each city revenue versus where we think we might be able to get to, where we start to have to look at some proxy data. For example, Google can help us understand what we believe our penetration in that city is versus a benchmark say of New York or DC, where we currently have our strongest brand recognition. That could give us some guidance as to whether, if we're doing X dollars of revenue, do we think if we jump in, we can increase that by 25%, 50% or more than 100%? Then we have to partner with the marketing team to understand what sort of a marketing effort would be required to get us there within a year or 18 months to break even, which is sort of, not a hard rule, but it's sort of a general proxy of what we're going to be looking for.

Stephanie:

Okay. When it comes to that marketing effort, what kind of channels do you look for, especially when you're launching in a new city where maybe you're not well-known and it's like, this seems like a city maybe similar to DC, but we've never been there before? What kind of things do you explore to get those new customers and brand awareness?

Seth:

We have to probably devote certain on the ground marketing campaigns. It could be as simple as going to street fairs, it could be that we would take some sort of local radio or other sort of top of funnel awareness advertising out. Each city though, is really going to be unique. I think that's something that we've learned, even just having New York and DC, we see small differences in the average order value. We see small differences even between, say Manhattan and Brooklyn, in terms of the percentage of flowers versus plants that the consumers purchase. So, we'll have to do some research that helps us understand the consumer and then that would help us figure out which marketing channels would make sense. But we almost certainly would be more comfortable getting aggressive in awareness marketing when we jump into a new city, because the return on that investment should be pretty strong, given that when we get into a city, the conversion rate, we would expect to be higher on our ecommerce platform.

Stephanie:

Yeah. That's cool. I can also imagine if you have bike deliveries, like if they had the backpack with your logo and beautiful flowers sticking out of it. That in and of itself could be a great marketing tactic to spread word of mouth.

Seth:

Absolutely. That is an entire romantic vision is true, except hopefully for the flowers sticking out the back, because they should be in contained packaging.

Stephanie:

Oh yeah. I guess I would just buy all over the place if they're just sticking out. Huh.

Seth:

But we do have branded everything for our couriers, t-shirts and vests, the coveted sweatshirts and hoodies. In fact, one of the downfalls of our sort of head of delivery was that he designed a hoodie that was too well loved that, not to accuse our corporate team, but they started taking them in numbers that they shouldn't have so we had to place an extra order. It really is the most comfortable hoodie.

Seth:

But it accomplishes two goals. The first, as we discussed is, it's really nice branding and advertising for the company. The second is it helps make these employees in these remote locations feel more part of our broader and greater team and brand.

Stephanie:

Yeah. I love that. Are there any other on the ground methods like that, that you're experimenting with or that you are hopeful of to promote word of mouth in maybe a new and different way?

Seth:

It's interesting in, especially the last nine months, we probably pulled back on a lot of that for obvious reasons. I think that it's an area where we would experiment, but I think you also have to be careful because it's hard to measure the effectiveness of that spend it takes, not just monetary resources, but really time. One of the things that I noted when I came on board in 2017 is that my city managers were being asked to do a lot of these in-person events. We hadn't really thought through how much of their time was being taken and how to think about them as an operations manager versus a marketing manager when we had a lot of work to do to scale the operations of the business. I think people just have to be thoughtful and careful about the KPIs that they're going to measure people against.

Seth:

But the people who are responsible for budget, but also the people whose time is going to be taken during these events. The good news is that the people love doing the events. These small scale events were very popular for the staff that, even after I told them that they should pull back, I found out months later, they were still doing them because they enjoyed them, but then they would complain that they didn't have time for other things. It did have to lead to some alignment meetings.

Stephanie:

Yeah. That's a really good point. So, thinking about the next piece that you mentioned was layering on supply chain when rolling out into new cities. It seems really difficult of course, with fresh items. So, how do you all go about thinking about that in a new city and building out a good supply chain that makes sure the flowers don't just die in a warehouse or something?

Seth:

A very sort of blocking and tackling for our goods is that you have to have a refrigerator. It has to be something that you have confidence is going to maintain temperature at around 35 degrees. And you, say very simple things like just like you're developing any real estate, make sure you give enough time to build it out, so you're not under pressure, because it's hard to come back from that if you're forcing yourself to open up on January 1, but you just can't have the refrigerator installed before then, you're going to fail. Making sure you understand your lead times. But for our business, I'd say the most important thing is understanding the notes in our networks. We have a larger facility in the Greater DC Area that helps service our New York and DC same day delivery locations.

Seth:

We have to think through as we branch out to more cities, if so for example, Philadelphia, we could certainly service from the same Maryland facility with limited additional CapEx, with limited additional complexity added to our supply chain. As we think to the West Coast, or as we think to, say the big populations in Texas or in the upper Midwest, if we have a facility nearby, there may be synergies where we can pull product from there and deliver it to a local facility. I would say that the farther we get from our home base, in terms of miles, in terms of being three hours and three time zones behind, you have to just ... it's hard to model it out on paper, but you have to start to acknowledge that the difficulties, things that could get lost in translation. You go from having everyone on the same eight hour, 9:00 to 5:00, to only overlapping for five hours, that can just sort of add strain to the systems.

Seth:

If you're going to go to the West coast, have you hired someone, did you decide that you're going to spend three months having them on the East Coast, training up, learning your culture before you send them to the West Coast, or you're going to take a gamble and just hire them on the West Coast and through more Zoom calls and maybe someone flying to California, try to build them into the culture and the brand of the company? I think those are really important decisions that don't sound like supply chain decisions, but ultimately, really help you down the line when someone is going to have to make a lot of executive calls that will impact your supply chain and will impact your ability to be successful or not on a day-to-day and week-to-week basis.

Stephanie:

Yeah. I think that's so important around building culture and a team. I mean, especially right now, where everything is digital and companies are still having to hire and find the right people, and it's kind of hard over Zoom. I've interviewed some people over zoom and it's like, you don't really know if you know them or how many notes they have in front of them, or what's really going on. How do you guys go about building a relationship and hiring? I think earlier you mentioned having this connection economy, where everyone's on digital tools, but people still want to connect in the real world, but maybe you can't right now. How do you think about that with teams and cultures and hiring new people?

Seth:

Yeah, that's a great question. We actually have hired probably about half a dozen people since the lockdowns were initiated and since our corporate staff for the vast majority of folks have not gone into the office. I'd say that we had one key advantage, which was that, before March, we did have a team that was split between New York and DC, so it was not uncommon for us to be on video conferencing. That transition was, to some degree, at least natural. In terms of the hiring process, I'd say the hardest part, and one that we definitely still have not right, and I'll be honest, for some small company, we didn't have it right necessarily before the pandemic was the onboarding. That the team though has started to make headway, we've gotten our swag. We've actually pulled it from the various physical locations and people are getting a care package now when they are in their first week at the company.

Seth:

I make sure to reach out to new hires during their first week to just welcome them with a warm email and then tell them when they're feeling no longer overwhelmed that we'll have a 30 or 45 minute call with no specific agenda other than really getting to know each other. I can try to sprinkle a few of my thoughts around company mission and values into those calls.

Seth:

I think for hiring managers and/or senior executives out there, I would also say, it's not just you making sure you know them. If you have someone that you really like, how are they getting to know you and feeling it on both sides? That you have an easier time convincing them to come on board.

Stephanie:

Yeah. Are there any best tips that you recommend to make sure that the candidates get to know you because, especially over Zoom, it seems like people are always talking over each other, even with ... I was talking earlier about internet, the video's not on, I had to turn it off. Is there anything that you guys practice to make sure that, not only are you getting to know the candidates, but also that they feel comfort with you and can ask questions and feel confident about that?

Seth:

Yeah, so we do as much as possible try to do video rather than just phone call interviews. I guess you could make arguments that that's better or worse, but it certainly allows people to respond to facial expressions, queues when it looks like someone is about to speak so you can try not to talk over them. I do reserve the last 15 minutes of every interview to allow the interviewee to ask me questions. That's both for them, and also, I secretly am looking to see how prepared someone is by the quality and thoughtfulness of the questions that they ask. If anyone is local, I will try to meet with them in person. We have to be thoughtful about that. Let's say we have two candidates and one is in New York and one is in DC, and we haven't crossed this bridge yet, but how do we make sure there's no implicit bias that we're pushing for the person that we met in person? But we try to have a variety of interviewers for each role. I think we've done a pretty good job with that.

Stephanie:

Okay, cool. Thinking through bringing on new employees, the first thing that's coming to my mind is scaling companies, something you've had quite a bit of success with around HelloFresh and now UrbanStems. I wanted to hear a little bit about how you think about scaling companies, whether it's at UrbanStems or HelloFresh or anything in the past that you've worked on.

Seth:

Yeah. I think what I try to do is, when I do have a moment to step back, is look at each function within the business, or I look what our plan is, where are we expected to get to over the next year? Whether that's our revenue mark, whether that's improvement along other KPIs or important metrics, and I try to pair that against each function. Is each function at a point where they can make that leap without any additional people? Are they at a point where they can make that leap but they'll need to improve just process? Do they need technology investments in their function in order to be more successful? We are nowhere near perfect on this, but each year we've gotten better. Our planning process is in the sort of June/July timeframe, of talking through what that plan is, and each team trying to think through what they will need to be successful there.

Seth:

I would say that stepping back where you run into problems, and it's sort of dual-edged sword, is if you put cash out and investments ahead of growth, you can get yourself in trouble. But you can also get yourself in trouble if you put growth ahead of investment. It is a dangerous game. I think, when it comes to hiring people we try to be thoughtful. It's also, what level are you hiring at? That's something you'll often hear me say to the team if they ask for another resource. To me, it's most important that we get that right level right. Very different to hire an associate versus even someone with two or three years of experience where you're saying, we just could not be successful, we hired someone just out of college. My next question will almost assuredly be, why?

Seth:

And managing the specific work that someone needs to do against the experience that you're saying is required. You don't want to hire someone too senior to do junior level work. They won't find it satisfying. There is such a thing as overqualified. Then on the flip side, you have to be careful what you can expect of someone more junior and what level of accountability and ownership you can place on them. I think, to me, that's the most important thing, is making sure you're hiring it to the right level, that everyone is aligned, that this role is needed. The reality is, in almost any startup, you're going to have a whole slew of resources that are not yet hired that people think are necessary, and trying to at least agree on alignment on when those might get prioritized.

Seth:

If something comes up that accelerates something, that happens too. That can throw a wrench in plans and you have to walk people through that that's happening and have conversations, well, hey, how did this new role cut in line ahead of the others? That can be hard, but you have to do it.

Stephanie:

I've definitely seen that in the past. At previous companies I've been at, I worked in finance, and every team always wanted headcount. Everyone always had a reason and were pretty good at justifying why they need those people. How do you go about spotting those opportunities of like, this is an area that obviously needs investment and I see growth coming after that? How do you actually think through finding the opportunities when they seem like they're pretty hard to spot? What's holding what up to create growth or to create exponential growth in the future?

Seth:

Yeah. I would say that you're sort of hiring for two reasons. One is growth, like you said, we're truly, there's a revenue or a profit or a customer experience opportunity that's not yet ... We can't go after because we don't have someone on the team. The other is that we're, I don't want to say things are crumbling, but sort of this more fixing the foundational type hires that you have a critical process that's not being executed the way you want. That's where you have to start to lean in and understand, is that a process technology or a resource issue? Once you get comfort that that's a resource issue, from my standpoint, typically that's a pretty easy hire, because, unless you have invested in something that's causing friction, that itself is not worth investing in, that hire will pay for themselves financially, because they're going to unblock something that, that is important to be unblocked.

Seth:

That's how I get comfortable with those kinds of hires. On the revenue side, if it's creating something new, you can run ROI models. Sometimes you can do those in your head. Sometimes you put them down on paper. Then for other functions, sometimes it is a little bit of taking a risk. For example, it was about a year or 18 months ago that we decided we needed a stronger social presence. We weren't sure exactly what that meant financially, but we brought someone on board on our brand director, Megan's team. After a few months, we started to really see results. We were really impressed. We managed to, in the last 18 months, five X on our Instagram following, not that that's the be all and end all of KPIs. Then for the sort of CFO in me, we started to see revenue, directly attributable revenue follow that.

Seth:

I think the other thing that, this is where managers have to do, is they have to sometimes take a risk. They say, there's a resource I'm really asking for, this is what I think it will return, and when they have something pan out, they are able to probably come to that next meeting with an ask with a little more confidence themselves, and with the, me again wearing my CFO hat, and me having more confidence to say yes to that opportunity.

Stephanie:

That's cool. I like you wearing your CFO hat. I appreciate that with a background in finance. You just mentioned, which I'm now I'm sure a lot of people are like, well, tell me how you grew your social, because that is an avenue that obviously a lot of brands are relying on and it's becoming even more important with the ability to click and buy on social, or at least it's headed in that direction. What did you guys do to grow your social presence?

Seth:

Yeah, so the very first thing we did is, like I mentioned, hire a dedicated resource, someone who spends probably 75% plus of her time thinking through our social channels and how we can become more influential there. Second is, once we started to see some results there, we added a SaaS software platform that helped us assess which visuals were going to be more engaging for our customer base. We did, though still have conversations, interestingly enough, the photos that I'd say I prefer from a brand perspective, those with people in them significantly underperform those of just flowers.

Stephanie:

Oh, interesting. This is a piece of tech that you guys were utilizing to figure out which ones like, which images would you best?

Seth:

Yeah. I actually don't know how precise it is, but it certainly helped us. We didn't need that to tell us that people underperformed flowers, but even just different variants of a similar image, they were able to pretty convincingly predict which one was going to outperform. Obviously we are betting on engagement, at least these measurable engagement statistics mattering. I think one of the hardest things in social is understanding what matters and what doesn't. Like I said, having our Instagram following at 150,000 versus at 30,000, where it was, we think that is directionally very good, is that, can I quantify what that means for our company? No. Will we continue to push to increase our reach. Absolutely. Are we seeing that increased reach is translating into direct revenue? Yes. Is that our only goal? No.

Seth:

Do we know the relationship between directly attributable revenue and non-attributable revenue? No, we have no idea if that even is the same month over month. But these investments that we made in a resource, training her, we actually had some, at one point also gave a green light to bring on an intern so that our full-time hire could manage up and start to add strategy to how she was thinking through, not just executing every day, and that's been great. We talked about that. How much is this going to cost? What is this person going to do? It was a pretty quick decision. But because it wasn't a ton of money, but even there, what I think is still critical is that someone comes to the table with that analysis done that's thoughtful, and that they seek to justify any investment, whether it's $100,000 or $1 million or $1,000.

Seth:

It just gets people in the discipline habit of understanding that money is going to be invested or not across teams, and it's not ... there's not an infinite amount of it.

Stephanie:

That's very cool. Now that your social person is able to start managing up, what kind of tactics or strategies are they hoping to implement over the next couple of years? What are they saying they believe in, or they want to try or test out?

Seth:

Yeah. I think a big buzz word in social is influencer. One of the things I've said is, if Oprah came out and endorsed UrbanStems, I don't know if that would even help us because our website would probably crash. We'd be out of stock on inventory in the next 20 minutes, and we'd enrage all of our good customers who came back and sold out. So, we have to think through how we would even execute that, but the team is bullish that, that matters. So, we're trying to think through that. I certainly also believe in content. The team believes in that. So, expect the we'll invest more in content. It's no secret that video content outperforms static photo content. So, looking at that, but it's also no surprise to anyone that videos are a lot more expensive to make than taking photos.

Seth:

You have to figure out what your budget is. You have to still be able to test very scrappily. I still will always believe in that, some of the best content is always going to be UGC. Some of the best content is going to be filmed in an iPhone, or for suckers like me, Samsung Galaxies. It's about mixing that with the more professionally created content, figuring out where and when to spend bigger, both from a photography standpoint and from a video. For example, the team did a wonderful job. This Thanksgiving, we have a dedicated lining page, which features video for the first time on the site.

Stephanie:

Oh nice.

Seth:

I'm really excited about that, testing it and testing more of that. With everything digital, the best thing is that you can always AB test that. Even if you spent a ton of money on something, I still encourage you to AB test it, to ensure that it's working. If you want to AB tested at 80% with the video and 20% control without so that you get more out there, that's fine. It'll just take a little longer to get the results of that test.

Stephanie:

Yeah, that's great. I appreciate you letting us look into the future with you and your team. I'm sure that you're probably like, ah, I don't want people bringing this up anymore. That's so three years ago. However, it came to my mind when you were talking about Oprah and if she were to endorse you guys and you could sell out, and their website will crash. It brings me back to, of course what happened in 2017 that I think a lot of people could learn from, who are listening, around, I think there was like a Valentine's day snafu where you had too many orders and the website maybe crashed or something. Tell me a little bit about that and what you guys have ... what actually happened, what are the details on it? I know you weren't there, but what are the details? What have you learned from it? And what do things look like today?

Seth:

Yeah. No, I wasn't, but I don't think that's the sort of important part of the story. I think, in three short words, we messed up. We did not fully understand how we were going to execute the holiday. It was unfortunate that it was on Valentine's day, which is one of these two days a year that everyone looks to flower companies to sort of solve their buying need, which is to get flowers delivered. We were better at marketing than we were at executing that year. We learned a lot. I think that that's the most important thing, which is we learned that we needed a more sophisticated plan. That plan needed to be backed by data. To be honest, this is why I came in. This is why Ajay asked me to come into the business, which was to help figure it out for the next year.

Seth:

The first thing I did was I talked to people. I got the stories. I started sharing those stories around to make sure that they matched with what people thought went wrong. I started to look at data, and data helped me craft a plan. One thing that I actually think I did really well is that we had the data and we had the plan, and we just kept going over the plan. I think that is one of those things that, for people who would like to move quickly, can infuriate you. It's infuriated me at times. The number of times that I think we had to go over the plan or that we went over it was well into the double digits, just reviewing and reviewing, but we were successful and it wasn't just that we fixed everything from the previous year.

Seth:

In fact, we had to make changes that had nothing to do with people making mistakes. We had just pushed too many orders into certain physical facilities than we could handle. Our tech had not been robustly tested to meet the peak needs by a combination of looking at data and incorporating feedback from people who had gone through it. We were able to create a plan that was, again, based in numbers and efficiency metrics, and a realistic execution, still stretched by all means. We did not pull back. But to the credit of Ajay, he brought me in, and he gave me the green light to bring in some additional resources, which I did. We did some new things. We delivered for the first time in the company's history via a third party parcel carrier that allowed us to take orders that we otherwise wouldn't have been able to take.

Seth:

We had an on-time rate of about 98% to 99%. So, it was a nice reversal from the previous year. The way we phrase it with the team is, it's three and a half years ago, so it's, we don't dwell on it. But we do remember it, and we remember it as a way of motivating ourselves to make sure that our plans have been vetted, thought through, are based in data and have been shared with the team well enough in advance so they feel confident in their ability to execute them.

Stephanie:

Yep. What are some of the biggest data points that you looked at? When you were coming in or when you reviewed what actually happened, what were some of the biggest things that stood out where you were like, oh, was it the website crashing because it was the tech stack? Was it the supply chain? What specific things were the biggest contributors that maybe any new company can learn from of like, oh, if I'm setting up a similar type business, I need to look for this, this and this. If Oprah decides to come out and give me a shout out.

Seth:

Yeah. And Oprah, if you're listening, we will still take the shout out.

Stephanie:

Yeah, send it our way.

Seth:

But I think the challenge was, when I got ... everyone thought it was everything. It was really important to help people compartmentalize. It actually brought me back to a course in business school. I feel like, in many respects, I was one of the only people, one of the only ones of my friends who actually learned something in business. I remember taking an operations course and it talked about a factory that made, I forget if it was chocolates or chairs, it almost doesn't matter, and they said it was an assembly line and it took a minute to make the first chocolate. The chocolate had to go through, it doesn't even matter, let's call it six steps that each took 10 seconds, and it said, how many chocolates can you make in an hour? I got it wrong.

Seth:

I said, well, you can make 60. It takes a minute to make each chocolate. It turns out that there were six, like I said, six steps, each were 10 seconds. So, you can actually make six a minute, or 360 an hour. My mind was blown. It was really cool to figure out how an assembly works, what throughput is. I went to a Chipotle just to observe it in action, to find out what the bottleneck was and to figure out actually how a company like Chipotle does an amazing job at lunchtime. It's actually the cashier who typically is the bottleneck. So, you can see they add an extra cashier. Sometimes it's the first person who has to do both your burrito and the meat. So, you'll see they have an extra person who just does the meat. If you ever want to understand operations one-on-one in action, go to a Chipotle at peak time.

Stephanie:

Oh, that's good. I'll be looking at police so differently now.

Seth:

What really I just had to understand, and what was clear to me is they hadn't really done that kind of analysis to look at throughput, how many orders can be packed out. We also have to ... people kept telling you what the bottleneck is. The bottleneck is basically where your business chokes, what's the slowest part of your operation. People kept telling me things that ... and then I would say, well, how long does it take to do this? And I would write down the answer, and the numbers they gave me did not match with it being a bottleneck, which either meant that it wasn't the bottleneck, or that it took a lot longer than what they thought.

Seth:

The key thing was keep digging, keep trying to understand, is it ... because at the end of the day, the math will be the truth that you can use. But if your assumption is based on faulty math, then it's just garbage math. So, you have to look at the operation in action and you have to understand, so for example, with us printing out these custom note cards, whereas it's the note that you wanted for your mother for Mother's Day, right? That's what makes every UrbanStems order unique, besides the fact that you get to pick the bouquet you want and the ad-ons that are specific to your order, which took a lot of technological build hardware and software, to be honest, but it's that note card.

Seth:

I was told, "This is our bottleneck," and I said, "Well, how long does it take to print a note card?" And they said, "Five seconds." I said, well, it takes a lot longer to pack out an order than five seconds. That can't be. But then I started to lean in, and it turns out that they would print 20 of these note cards at a time, and then they would organize these into a folder, and then they would put the folder away, and then they would bring the folder back out when they were ready to pack out. What was five seconds, when I did all the math, ended up being a minute, and you couldn't even do them one by one, like in the chocolate example, because you had to get 20 chocolates assembled at once. You had to wait for 20 of those chocolates to go down to the end of the assembly line before. So, if you ever got behind, the time to catch up was significant.

Stephanie:

Oh, wow. That's really Interesting, about like something where you're like, oh no, that's not the problem. Then being like, oh, actually your process is the biggest part of the problem.

Seth:

Exactly. This is a very cool evolution. People who have not been at the company for at least two years, don't understand. With a bottleneck, you have two solutions. You either make it more effective or you add resources to the bottleneck. The first year that's what we did. We had five of our most analytical people, five very smart people who just on Valentine's day helped us print them. As absurd as that sounds, that's what we did. We just overwhelmed the process with resources. This past year, the tech team and the supply chain team got together and they completely reinvented. Now, every single order is sent to a specific person's queue that ties to their physical desk, and there's a printer at every station and that printer prints out one note card at a time that's tied to that a specific order. Now, it takes five seconds to print an old card, and it is no longer a bottleneck.

Stephanie:

Yeah. That's great. It seems like there'd be a lot less room for things to get lost. I mean, if everything's in a folder and you're trying to sort through it, [crosstalk] maybe picking up the wrong notes and you'd be like, hey grandma, and be like, oh, this is the wrong note that got sent out. It seems a lot more. Yeah. You're not going to have any errors doing it this way now.

Seth:

Yeah. The error rate, both reported and for sure, actual declined. We also saw that our throughput overall went up by 50%, 60%, 70%, and we could train people on this new system much faster. Those five people that I mentioned that had to be in that room on Valentine's day now don't have to be in that room.

Stephanie:

Yep. That was very good reminders about bottlenecks. I think it's very encouraging for every new brand to kind of look into that and really dive deep. So, yeah, I love that example. All right. The couple of minutes left, let's jump over to the lightning round brought to you by Salesforce Commerce Cloud. This I'm going to ask you a question and you have a minute or less to answer. Are you ready, Seth?

Seth:

I am ready.

Stephanie:

All right. We'll start with the hardest one first. What one thing will have the biggest impact on ecommerce in the next year?

Seth:

The one thing that'll have the biggest impact on ecommerce is FedEx and UPS.

Stephanie:

Okay. Tell me a bit more.

Seth:

Yeah. Their ability to grow and sustain their supply chains and deliver on time is going to be critical to, in the next 13 months, they're going to have two holiday seasons, and either a lot of happy customers or a lot of unhappy customers. It'll be really interesting, your 800 pound gorilla. Amazon is highly confident because they've largely disintermediated their over-reliance on UPS. In fact, FedEx and Amazon, they're divorced for the most part. I think that their ability to continue to shift to ecommerce to add Saturday and Sunday delivery nationwide to do FedEx, and UPS delivery to do ground deliveries next day, seven days a week, based on a previous day pickup, all of these things are going to either allow ecommerce to continue to blossom or hold it back. Also, what's very unclear is how much they're going to raise rates in January. Typical years call it 3% to 6%. There is a lot of concern that they could be above, and potentially well above that 6%, and what does that do to demand?

Stephanie:

Yep. Yeah, that's a really good answer. What one topic or thing do you wish you knew more about?

Seth:

One topic or a thing.

Stephanie:

[crosstalk] technology or ...

Seth:

I've been in and around physical product ecommerce businesses. I think getting more in the data and technology side is always the right ... that is always the future. I love being in consumer businesses. I love the ability to ask almost anyone about the product or service that I'm working with and trying to lead forward and getting their opinion and having that opinion matter. That's the joy and the challenge of ecommerce, but certainly getting deeper into data, getting deeper in technology is something I'm going to encourage anyone, especially anyone young, certainly what I'm going to get my kids into.

Stephanie:

Yep. I love that. If you were to have a podcast, what would it be about, and who would your first guest be?

Seth:

I think it would be about brands that do it right. I think that I so admire people who build iconic brands, and it goes back to this consumer side of things, but to me, it's looking at these revered brands and whether they are the Phil Knights, Nikes of the world, Reed Hastings and Netflix, or some lesser known smaller brands. I'm always so impressed with people who take the leap to do it. Those, especially who do it without raising significant amounts of capital and create something that just clicks and resonates with consumers, because I think we can all learn that. I find that I've been around companies that have done a nice mix of brand and execution, that have focused so much on execution. I think it's something that I'm good at, and I've been around other people that have been good at it. Maybe it's because of that, that I so admire the folks, those creative, just truly creative visionaries on the branding side.

Stephanie:

I love that. And who would you pick to bring on as your first guest?

Seth:

Who would I pick to bring on as my first guest? I guess, not that Reed Hastings would agree, but Netflix ...

Stephanie:

He might.

Seth:

Netflix so transformed and based on an industry that could have gotten there, had they seen it coming. In fact, I think at some point he had discussed with them with blockbuster buying out the business, and they dismissed him. I'm sure he has fabulous stories. I'm not so interested in actually the last three years where they've been a powerhouse. I'm really interested in those first years when he struggled, when he kept the faith when things were not going well, how he saw the future when others didn't, how he pivoted from CDs delivered, when he knew it was the time to digital and build something big and special, how he hired people in those early years and got them convinced it was going to be big and special. Those are the questions that are ... and/or now getting the best and the brightest is easy, given the company that they've built. But it's those early years that I'd be really excited to learn about.

Stephanie:

Yep. Yeah, I love that. I think we have the same kind of passion, and you would probably like one of our other podcasts called the story, because it's about people like that. We did retastings Phil Knight, We do Elon Musk, and it talks about the early days, how they got started and then you guess their identity at the end, because you wouldn't actually all the things they went through to build the companies that they did. You have to check that out.

Seth:

Very good. I will.

Stephanie:

All right, Seth. Well, this has been a great interview. Where can people find out more about you and UrbanStems?

Seth:

Yeah, UrbanStems is the company name and it's also our website, so urbanstems.com will get you there. If you want, you can also reach out to me, seth.goldman@urbanstems. I'd be happy to chat with you. I'd be happy to provide you with a promo code on your first order. We love people enjoying flowers, and more importantly, we love people sending gratitude to people that they care about.

Stephanie:

Awesome. Love that. Thanks so much, Seth.

Seth:

Thank you so much, Stephanie. Bye.

Creating Customer-Driven Healthcare with Hilary Coles, Co-Founder of hims & hers

info@mission.org (Mission) — Tue, 22 Dec 2020 08:00:00 +0000

The fact of that matter is that the healthcare system was not built with the consumer in mind. That is, until hims & hers came along.

This three-year-old company has been making waves in the industry, and for good reason. Its platform has facilitated more than two million medical visits and is valued at more than $1.6 billion. And all of this in an industry that has been immune to disruption for decades.

hims & hers is the first true consumer healthcare brand that, through its platform, creates an easy, transparent, and high-quality experience for all those frustrated with their current healthcare option. Its mission is to help people finally feel empowered to talk about and get treated for certain conditions, and Hilary Coles, the co-founder and VP of Merchandising for the company, is responsible for making that happen.

On this episode of Up Next in Commerce, Hilary explains why humor really is the best medicine when it comes to marketing, and she talks about how brands should approach experimentation. Plus, she provides tips to anyone who is thinking about trying to disrupt a big industry, and why she thinks it’s a risk worth taking.

Main Takeaways:

Everything the Light Touches: Talking about certain things is uncomfortable — especially when it comes to your healthcare. But for a brand to make an impact, it has to have a message, reach into those uncomfortable places, and make it okay for those you’re trying to reach to talk about them too. By embracing humor and truth in marketing, you create an authenticity that is often missing and you open the door for your target consumers to feel empowered to take action.
Social Experiments: Making experimentation and ideation a social process is one of the best ways to bring the most creative ideas to the table. When you invite everyone to contribute, and when you are honest with everyone about what ideas worked and which failed, you create an atmosphere that encourages risk-taking and you are more likely to experiment in channels or with opportunities your competitors are overlooking.
But Why?: Having an endless curiosity and need to ask “why” is the best way to disrupt an industry, and also to keep improving your processes. Too often companies or entire industries fall back on doing things the way they have always been done. The company that comes in and consistently questions how and why things are done a certain way and then changes them is the one that consumers will begin to take notice of.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome back to Up Next In Commerce. This is Stephanie Postles, co-founder of mission.org. Today, I'm really excited to be chatting Hilary Coles, the co-founder at hims and hers. Hilary, welcome.

Hilary:

Thank you so much for having me.

Stephanie:

Yeah, I'm really excited. I think we're going to have such a good conversation and there's so many areas where we can take it. I was doing a bit of research, and there are so many case studies built around you guys. Did you know that?

Hilary:

I didn't actually know that. Is that true?

Stephanie:

Yeah, I found at least three and so many articles diving into your business model. So, there's a lot of content I want to cover, and maybe first we need to start with what is hims and hers?

Hilary:

hims and hers is really the first consumer health care brand, and what that means is that we prioritize the consumer and really thought through every aspect of the business in order to suit the consumer, in order to give them choice, in order to give them control, in order to give them transparency into how they take care of themselves because we thought it was way too hard to take care of yourself today and navigating the health care system is incredibly difficult. And that's really because it's never been built with the consumer in mind, and so everything we've done from the beginning has been really just to champion the consumer. And so, today hims and hers is a platform that allows you to treat everything from dermatological conditions like acne to sexual health and wellness, to metal health, to hair care, all conveniently from home, which after this year has never been more important.

Stephanie:

So, as a new customer, I can essentially get on there, have a virtual doctor's visit, maybe even get a prescription for something I need, and then even order it on your platform, like it's everything from start to finish? Am I thinking about that correctly?

Hilary:

Exactly. Everything happens on our platform, and the reason why we did that is so that we could ensure that from start to finish we were in control of the level of quality that you would experience as a consumer. So, from the moment you come on to our platform, you select what you're interested in, what your health care goals are, you are given education, you are given a direct relationship with a provider, you are given product options, and you are able to make that decision that's right for you. And then, you're able to skip going to the pharmacy, skip taking off work, finding child care, taking off time in your day to go see a doctor, and able to talk to a doctor from wherever you feel comfortable. And then, having that product shipped directly to you and managed by you, which is again, just totally revolutionary from the way we've thought about health care to date, which has never prioritized the customer's needs but has focused really on everyone else in the healthcare industry except for the patient.

Stephanie:

Yeah. When I was looking through it I'm like, "Oh my gosh, this is what I've needed all my life." I've always thought everything with health care feels backwards and old school, and I'm like, "How have I not heard of this?" I mean, I'd heard of you guys before but I didn't know it was also for women.

Hilary:

Yeah, it's such a good point, and the reason why we developed hims and hers is because when we looked at our lives and the level of control and choice we have with with, you can choose a hundred different things to be delivered to your house in the next 20 minutes for lunch. You can choose your mode of transportation, you can choose what kind of couch to get delivered to your house. You can choose what kind of workout you're going to do today at whatever price you want, but when it came to your health care it was like this weird thing that you put off doing because it was so inconvenient. You never knew what it was going to cost. You were made to kind of go on a maze to figure out who's the right provider, are they covered by your insurance, how do you pick an insurance plan? And it's so unlike the rest of our world works today, and I think consumers are too smart for that and they expect better. And so, we really just developed something that fit into the rest of our lives.

Stephanie:

I love that. So, just so everyone knows the scale of where you guys are at, because I saw a lot of numbers from all my research, everything from evaluations, your revenue numbers, but I'd rather hear it from you and know it's accurate. Where are you guys today? What's your evaluation or what revenue numbers can you share just so everyone knows how big you are? Like, you're legit.

Hilary:

We're legit. So, in the past three years we've done well over two million medical visits, and when you think of a big company like Teladoc in this space, it took them 13 years to get to one million visits, so we've accomplished double that in three years. We are valued at 1.6 billion dollars.

Stephanie:

Billion, everyone.

Hilary:

Which we think there's so much more to do, because if you think about it, the health care industry is really the last trillion dollar industry that hasn't been disrupted. So, we really think this is just... It sounds like a big number, but it's just the really top top tip of the iceberg. The majority of our business is subscriptions, ongoing reoccurring revenue, and yeah. There's lots of excitement coming. We have more than a dozen conditions that we treat with almost 100 skus, so we've really... I think that's been a key differentiator for us in this industry as more and more people enter the D to C healthcare industry. When you look around at the landscape, so much of it is pretty niche and one condition focused, and what we've strived to do from our early days is be this umbrella company where you really can treat multiple conditions, you really can take care of yourself very practically on one simple to use platform. We're not expecting you to jump around.

Stephanie:

And that's great, it really is. It's like the future, it's what I've always wanted. So, I love talking about the early days of starting these companies, and especially with yours it feels like it's so intricate, especially on the back end. Probably not for the consumers who are like, "Oh, everything just works," but behind the scenes I'm just thinking about the partnerships that you're getting with the doctors, and then you got the products that you're selling and how to make everything work. I want to hear a little bit about how did you start it, what did you focus on first, and maybe what did you experience where you're like, "We would've done that differently if we knew what we knew now?"

Hilary:

Right. Hindsight is 20/20, of course, but we... Our first iteration into Hims was an MVP I think that we called club room at the time, and that was to learn how men were shopping for haircare products, and specifically hair loss products at the time. We explored funneling and promotions, we explored brand personas, and really how to talk to men. And we learned a lot about price points, we learned a lot about what men were looking for, and that was a really really valuable... We got enough signal really from that to have confidence that we were doing something differently with what is not hims and hers. And we knew a couple of things, we knew we would have to provide access to providers in every single state. So, by the way, that means setting up an entity in every single state, which is just a tremendous amount of work. There's nothing out of the box we could do so we had to build everything from scratch on the back end.

Hilary:

We needed to have proprietary products. Part of our goal and what we've continued to do is really blending both wellness products and prescription products and education, and so we had to create our own wellness products. So, I remember in the early days showing up to manufacturers in the middle of the country who looked at me like I was crazy and I was begging them to put our brand on the line and produce Minoxidil, which is generic Rogaine. And they basically said they felt bad for taking our money because this is an industry that hadn't shifted in decades, and what were we thinking, and there's no way this is going to work. And we were able to blow through what we had ordered from them in days, not months, and from there it was just kind of beyond. I think everything we processed from the beginning, or we prioritized from the beginning, was our brand. I think we knew that unlike 10, 15 years ago when you had all of these "disrupting" startups coming out your brand wasn't as important, but because the barrier to enter direct to consumer brands is so low these days with all the onslaughts of digital channels that you have, having a differentiating brand, having a point of view becomes so important and earning trust becomes so important.

Hilary:

And you need to do that, you need to have a deeply differentiated and personified brand today in a way that I think was not as urgently important 10 years ago. And so, that was the bet we took early on that really really paid off, as well. And [crosstalk 00:10:19]-

Stephanie:

You can definitely see that with all your marketing and branding, and people are eager to buy your products and you focused on a market, especially around men in the beginning, that I think wasn't being served well. I mean, you mentioned Rogaine and I'm thinking about the commercials back then of like just not very pleasant ones. I wouldn't want to buy that product based on the TV commercials I used to see around that, and it seems like you leaned into that and not only served the market but did it in a way that people were eager to even talk about it and have word of mouth.

Hilary:

Totally. I think the most interesting thing about our brand today, and especially in the early days, was that majority of the people coming to us for hair loss, for sexual wellness, for mental health, it's the first time they're ever treating these conditions, the first time they've trusted anyone with these conditions, and that's a big deal because it's not like you wake up one morning and you decide you're going to take action. It's usually on the heels of days and weeks and months and years of feeling unsure and feeling like it was something you had to hide in the back of your cabinet or didn't want to engage with, like the Rogaine example you just had. And so, that's really been the key unlock is that relationship we've been able to foster. And to this day, that remains my favorite compliment that we get as a business is, "Your brand empowered me. It made me believe in myself." That's really what we're getting at here, because the products exist, and for us it's about kind of slaying all the dragons of access and cost and barriers to make it easy for the customer but we can't walk you to the front door. We have to be on the journey with you and you have to believe that we're on that journey with you, and so that's really our mission at the end of the day.

Stephanie:

I love that. So, you just mentioned about the brand empowering your customers. How do you create that messaging, especially around topics that a lot of people don't want to talk about? How do you go about doing that in a way that has grown and seen the success that you all have?

Hilary:

I think one of my favorite quotes ever is that sunlight is the best disinfectant, because I think if you can't see it you can't talk about it. And so, that, from the very early days of fundraising, was a big eye opener for us because when we came into the room and we were talking about erectile dysfunction and hair loss, no one wanted to be the first to ask any questions about it. No one wanted to seem overly interested in it even, you don't want to be associated in it. And it wasn't until we changed tack and started using humor and started using numbers and saying, "Hey, every third person in this room will probably suffer from erectile dysfunction or hair loss." You need that provocation, that shock, that humor to remind ourselves that in a weird way, you're not special, like baldness doesn't... hair loss doesn't choose you, anxiety doesn't choose you. It happens and it's common, and if we're all in it together we can talk about it. We can find the education, the products, and the services to tackle it and get you feeling good.

Stephanie:

Yeah, that's great. All the campaigns I was looking at were funny and I could definitely see it sparking engagement, like people like... I mean, I saw there was a urinal campaign that you guys did and there was a quote I think that you said-

Hilary:

Our urinal takeover.

Stephanie:

Yeah, you're like, "No one in the history of ballparks ever wanted to advertise in a urinal, but we saw it as a creative channel." Tell me, how do you even think of things that are funny like that? Maybe I'm just not a funny person because I'm like I would never think to do that, but that's great, or like your cactus, your erect cactus. You know, people look at that, they know what this is for, it's super funny.

Hilary:

Right. You can't deny... I think that was part of the beauty certainly the early campaigns where we did city takeovers with city takeovers urinals dominations we called them with the phallic cacti, because you can't deny that you know what it is. You instantly know what it is, and so it save you the rigmarole and dance of are we talking about this, what is this, I think it's this. And fundamentally, I think some of the bets we've taken with marketing channels that have been more on the creative side like the urinal dominations, like we've sponsored corn hole tournaments, and all sorts of things that people haven't necessarily tried before. It's because I think we have a really deep empathy for our consumers and we're thoughtful about where are they spending time, where are their eyeballs? I always joke with our team, like, if you try hard and believe in yourself, anything can be a billboard or a messaging opportunity for the company because we're...

Hilary:

You want to meet your customer where they are, and I think unlike a typical DNVB and D to D playbooks out there where you're on the same channels as everyone competing for the same eyeballs, we really are striving to be health care for the people, for all people, for anyone with a body, and to do that we have to get eyeballs everywhere. We can't just be on the traditional digital channels. We have to think outside the box. We have to be provocative. We have to shift the traditional ways of thinking.

Stephanie:

How do you go about encouraging your team to think creatively like that and to come up with new ideas? Is there a process that you guys have in place or something to have fun ideas rise to the top like that?

Hilary:

Our team is amazing, so they need very little encouragement, but I think what we've preserved since the early days of Andrew and I joking around on text message late at night or around a table is just what do you think is interesting? What do you think is funny? what are we not seeing? And so, from whether it's a customer service agent, whether it's someone on our creative team, whether it's someone on our analytics team, just what are you interested and what are you seeing? And I think as the team's gotten bigger it's gotten... it's been so interesting to learn all of these different perspectives and what people are into. Like what is happening is with gamers? What is happening with cooking trends, and how is that relevant and what does that mean about people today? I think we try not to be too precious with our own ideas, and I think Andrew and I are the first ones to say, "Oh, that didn't work. That's fine," and we very much internally socialize the things that didn't work as much as the things that did. And that ladders back up to the priority we place on testing and learning, and so I think because we remain flexible with that and have fun with that all in service of learning, it makes every single big campaign less do or die.

Stephanie:

Yeah, I like the idea of not being too precious with your ideas and being open to just testing and seeing what works. In the spirit of testing, what campaign did you launch, or your team launch, where you're like, "That's not going to work," and it actually did?

Hilary:

Oh my goodness, we have... There is a commercial we can find later, and it's still shown, and it is essentially just our full portfolio of the Hims products and the signature peach and pastel colors that we've become known for. And all of sudden, when we launched our company three years ago we launched with candles, which a lot of people made fun of us for but we wanted to really be extremely explicit about the fact that we were a wellness company as well as a health care company and we were doing something different. And so, we played on this idea of candles being something we were known for, loved for, and mocked for, and that whole campaign is somebody just lighting that candle in front of the portfolio of products.

Stephanie:

Oh my gosh.

Hilary:

And we're like, "It's so simple. There's no way it's going to work," and it's been going for like a year and a half. It is far and away one of our most successful creatives.

Stephanie:

That's so funny. I've heard that same theme though around the things that you don't think will work actually end up working. I mean, especially we've been experimenting with different YouTube ads and just seeing what people connect with sometimes is a little out there our you're like, "Wait, why do people like this?" But that's why it's important to test and actually figure out what connects with people. Who knows, maybe in that candle commercial people are like, "Well, let me..." like, they're obviously going to look and see what's being the candle and analyzing it more than they probably would in any other commercial.

Hilary:

Right. You're competing with so much nowadays and I think there is a tendency sometimes to over complicate, to simply copy what other people are doing, and I think we've been pretty brave with what we're willing to test and keeping smart about that rather than having, you know, pouring millions of dollars into one solitary campaign, we're able to come up with several different iterations that are more appealing to more different groups of people. Which again, comes back to our mission of being for everyone and meeting you where you are.

Stephanie:

Yeah, I love that. I think going forward brands can learn a lot from your guys' campaigns because I think, especially the past couple of years, there's been a lot of censorship on how the brands can and should interact and what campaigns are okay or not, but I think really for that authenticity is going to be really important for the brands to actually come above the other ones and stand out by actually leaning into their goals and doing it in a way that they feel is best for their products and their customers and connecting with the people they need to.

Hilary:

That's totally right, and I think is one of the more exciting trends that I'm hoping we see more of in the coming years. I think, as I mentioned earlier, especially in the past five years, it became so easy to launch a company and as a result I think you saw a real copycat culture, a real everyone using the same kinds of design, a real same kind of brands and missions even, for a lack of a better word. And it became really hard to tell the difference between anybody, and I think where everyone's feet started being held to the fire is this year where there's been so much in the world happening and it's now becoming clear if you don't stand for something, or if you stand for the exact same thing as everybody else, you get lost in the shuffle. And I think that's really going to separate the brands that are here to stay from the brands that probably won't cut it, and it comes down to having that clear point of view. Because again, consumers are so smart and they know.

Stephanie:

Yeah, I think authenticity will always win and I would rather maybe be offended by a brand who's trying to do something where I remember them than just be like, "Oh, this is another brand saying that they're standing for the same thing as everyone else because they're probably being told that that's what they have to stand for." Those are the ones that I forget about versus the ones that are experimenting and trying and testing out messaging. That's the ones I'm excited to watch where they head.

Hilary:

Totally. I think that's where sometimes not saying anything is as powerful as saying something, and thinking about what do your customers really want from you? What are they coming to you for versus what you personally are excited about and what makes you sleep better at night? It's not about making you feel good, it's about serving your customer, and I think some brands get that twisted this year.

Stephanie:

Yeah, I completely agree. So, when it comes to... since we're diving pretty deep on marketing and brand voices and stuff, how do you think about measuring your campaigns and which ones are doing best? Like, I saw you partner with Snoop Dogg, which is awesome, like how do you measure a partnership like that versus your TV commercials and what's successful in that area?

Hilary:

I think the thing that has been the most interesting about our marketing approach is that on any given day we are in at least two dozen different channels, and we are testing within each of those channels. Again, it ladders up to this mission of being there for our consumer wherever they are, and so it's about not just having radio and podcasts and various audio, but it's what are you saying within each of those channels and does it make sense? Because you don't want to jar the customer out of what it is, and so, yes, the Snoop Dogg campaign was awesome for being well known and the J-Lo and A-Rod campaigns I think all make sense in certain contexts, but I think we keep a pretty broad playbook which allows us to really start the relationship off on the best possible foot with our consumer. Because I think at the end of the day the KPI that matters the most is NPS, and I think what's been really remarkable about hims and hers is that our NPS is 65, and for healthcare services the NPS of the whole rest of the industry is nine.

Stephanie:

That's what I was going to say, is it like five?

Hilary:

Yeah. So, we're talking about single digits, deeply unsatisfied people, deeply negative experiences, and we're talking about a huge exponential growth on that. And that's what we're really protective of and why I think a real reflection of what happens when you give consumers choice and control and transparency and kind of treat them like adults and know that giving them more information is not going to, if anything, going to increase their trust in their lifetime with you.

Stephanie:

Yeah, that's great. How do you think about personalization, because healthcare just seems like such a tricky thing, and especially when you're talking about the NPS and developing that trust. What do you do, if you do at all, personalize when communicating with people so they're like, "Oh, yeah, this is just about our conversation. This isn't a generic message?"

Hilary:

Absolutely. I think personalization remains so important particularly in healthcare where you're used to being treated like a number, where you're used to being left behind and expected to sprint to keep up with just a basic level of treatment. And that's where we've been able to differentiate so much by having that end to end control and being totally vertically integrated as our consumer healthcare platform. And so, we spend a lot of time thinking about, within each of our respective categories, within each of our respective brands, what that consumer journey looks like and what the consumer segment within that consumer journey looks like. So, that end to end we know you're going to get checked in on at the right time to make sure that your skin is adapting well to your new prescription skin routine that you're on, so that you're being exposed to the most amount of information and the ability to chat to your personal provider whenever suits you and being there kind of one step ahead. I think that's the best lessons in hospitality that we've tried to bring into our business of anticipating the need before it happens, before you even think about it, and that's where our service has been super seamless.

Stephanie:

So, how are you anticipating that need? Because that is a really good example where I'm thinking about factors... It'd be so nice if they checked in on me a bit more because I'm also just lazy.

Hilary:

Right?

Stephanie:

And a lot of times I might need something but I just need a reminder, but I haven't seen any of the traditional models having a good method for doing that, that checks in in a way that's not annoying.

Hilary:

Absolutely. So, each category, each journey is heavily directed by an advisory group of the top medical professionals from all the best institutions across the country, and really getting that brain trust together within that specific category, so say using the skincare example, the top dermatologists in the country and walking through if you had a magic wand, what would the best possible treatment look like for a patient? What would that best possible experience look like? And then, we map out, if you could clone yourself 600 times as a doctor, what would you be doing, and then we go and we build that.

Stephanie:

Man, that's a really good lesson I think for any business model. It's kind of coming in... I mean, it is coming in with a beginner mindset and just saying, "Start from scratch. How should this work?" Doesn't matter if it can work or if we know how to make it work, what should it be doing right now? What is success, and then building towards that?

Hilary:

Yeah. I think that's really fundamentally why we've been so successful in a short period of time, is we've just asked why, because in so many, especially in established industries like health care, so much of it is just continuing on because that's the way things have always been done. And a lot of it was just us asking naively, "Why? Why do you do it that way? Why is it done that way? Could it be done this way?" And just having that endless capacity I think for curiosity, and I think the more we... When we first started working on the company, we had assumed there were, to be frank, adults in the room who had already figured this out and had already really tried to do their best possible job for the consumer. And the more we asked questions, the more it became clear nobody was doing this and wasn't an impossible task nearly, it was it just needed a different lens and some elbow grease I think.

Stephanie:

I can imagine you guys getting a lot of pushback and people kind of betting against you, especially in the early days around what you wanted to do.

Hilary:

Oh, definitely. I think, one, sure, disrupted [inaudible] industry and then do it using millennial beige color and a bunch of cacti. We were nobody's best friend's. I remember even my fiance saying in the early days, like, "Are you sure about the name Hims?" I wasn't 100%.

Stephanie:

And now it's like, "Well, yeah, obviously."

Hilary:

Yeah, exactly.

Stephanie:

Very very cool. I could see there being a lot of room of having a great community, and maybe you guys already have that, because I'm thinking you're getting people to talk about topics that they maybe never would have otherwise, but you know everyone is on there googling their problems and you end up finding bad Reddit threads or, who the heck knows, whatever you stumble on, and you're trying to see, like, do other people have this issue? How are y'all approaching community and having people speak up and talk about and talk about their results and everything?

Hilary:

That's such a great question. That was a key motivation for us, is how you get people to stop doom spiraling and looking in the middle of the night for things... to ask about their health, because spoiler alert, anything you ask about your symptoms is going to lead to you're dying.

Stephanie:

Yeah, you're dead.

Hilary:

And it's scary and you're not empowered and you don't feel in control. And so, it was really like how do we make it so easy that even you would be willing to, just as easy as googling something, it's just that easy to go to our platform and that level of simplicity and directness of that relationship. And that was really, again, I think a key piece of having our brand be aspirational and safe and celebratory. And why we knew that that worked and why that resonated is in the first two weeks of sales of being open as a company, we had men submitting videos of themselves unboxing their hair loss kits, we had men submitting before and afters probably, and these are all on public channels like Instagram, tagging us in them. And these are things that historically were so private and had never been spoken about, and here they were sharing, tagging, telling us, "Please post. Please share my story. I feel so good and I had no idea it was possible, and everyone should know about this." And so, community from day one has been such a core piece of everything that we do in helping you feel like we're your hype person.

Hilary:

We're here for you, and I think people really responded to that idea of positivity. And I think that's kind of wild to think that there are brands with 100,000... a healthcare brand with 100,000 fans on Instagram who are-

Stephanie:

Yeah. No, that's wild.

Hilary:

... submitting and talking and sharing their, prior to us, deepest secrets. [crosstalk 00:33:34].

Stephanie:

Yeah, that's crazy to think about someone sharing before and after pictures without getting paid. I mean, that whole industry when you see those pictures you're like, "Is this real? Is this a real person that seems like they're kind of like me?" I mean, how did you encourage that word of mouth and encourage people to want to share that kind of stuff, other than just having a good product? Because that's obviously key, you have to have a good product that actually works, that people get excited about, but how do you encourage them to take that next step and actually put it on a platform that's public?

Hilary:

Yeah. I mean, truly we were surprised. We didn't think it would be a lever for us, especially in the beginning. We thought there was no way you were going to see the before and afters you were seeing on some of the other D to C companies or what you would normally see on a woman's brand, for example. When we started seeing it, we were like, "Oh, this opens up a whole new world," and so we built a community team that focuses on relationships with our existing consumer, and that can be everything from seeding them new products and seeing what they think of those products. It can be sharing their story for people who tell us that they want to be that inspiration for somebody else. And yeah, we've gotten to a point where we have 1,000 people in our community network who are just true fans of the brand that happened completely organic. And then-

Stephanie:

Very cool. So, what does the next maybe two or three years look like for hims and hers, and what kind of big best are you guys taking?

Hilary:

I think where we are really excited in the next couple of years is to continue to expand into more conditions in order to be of more service to the consumers on our platform, to provide entry points for new consumers, and to be able to manage with that high level of quality that consumers expect, more conditions. And so, for us what that means is entry into chronic conditions like fertility, like sleep, like cholesterol. That means expanding into broader portfolios into the main categories that we serve today, and that means continuing to expand into our wholesale partnerships like we have with Target which allow us to be more accessible, same day, more accessible in any single market to people who are in need of effective affordable products.

Stephanie:

That's very cool. What kind of advice do you have anyone who's looking to disrupt a big market? I think you're the perfect person to answer this, like it's doable, but what advice do you have?

Hilary:

It's doable. I think, again, just keeping asking why. I wouldn't assume that there's a reason why things are the way that it is. If you see something that isn't right, that doesn't reflect the world or reality that you want to live in, ask why. There's a good chance that it's a pinpoint for other people and it hasn't really been tacked effectively.

Stephanie:

Yeah. I love that, ask why. Is there any tech that you're betting on, tech trends, things that you're thinking you might be able to implement over the next couple of years that you're excited about?

Hilary:

I think we are super excited to continue to centralize information for our customers and help them make smarter decisions about their healthcare. When you look at, again, this digitally native generation who thinks of healthcare in a very different way from the way our parents think about healthcare... When you ask a gen-z or a millennial about how they think of taking care of themselves, it includes nutrition, it includes sleep, it includes mental health, it includes physical health. It includes a wholistic picture of flourishing, and I think using data to help coral all those decisions and provide them all at your fingertips so it's not just this discreet siloed experience, I think is very revolutionary and where we're excited to think about. And it's so different from how we all thought about healthcare before, which was you only really engage with it when something physical is broken and something wrong with you, otherwise you stay far far away. And so, I think we're motivated and excited about a future where you feel good because all of your decisions that affect how you feel are... You have options, you have information, and you have opportunity to help meet your goals.

Stephanie:

Yeah, that wholistic view of things is something I'm very excited about and can see you guys crushing, because right now, like I said, it does feel like so much of healthcare is siloed, and if I have an issue why isn't my diet taken into consideration? Why isn't how all my supplements interacting with each other, interacting with vitamins that might interact with whatever you're going to prescribe to me, like why isn't everything taken into account? So, to have like a dashboard where not only can your doctors talk easily and see what's going on wholistically, it seems like where the future needs to go and what everyone wants right now, and you guys are the first to tackle it.

Hilary:

Yeah, I think we firmly believe that the future needs to go the way our lifestyle and behavior preferences are going, and it's very cool, especially as we talk to the gen-z consumers who are like, "Yeah. No, of course, I never wanted it to be siloed and I fully reject a future where it is." And they're just... It's very cool to see that that's an expectation for the future, not a nice to have.

Stephanie:

Yeah, very inspiring. All right. So, let's move over to a quick lightning round, which is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Hilary?

Hilary:

All right. We'll see.

Stephanie:

All right, we'll the tougher question first. What one thing do you think is going to have the biggest impact on ecommerce in the next year?

Hilary:

I think big etailers entering the market and consolidating is going to have the biggest impact.

Stephanie:

Tell me a little bit more about that, that's interesting.

Hilary:

I think as we start to see, especially with the pandemic, we start to see Targets and Amazons and Walmarts start to be even more of a one stop shop than normal. As we're all trying to stay home and take care of our families and limit the amount of trips that we're making, I'm interested to see how those big companies start including different services, different products that where they wouldn't normally have been interested in in a year or two ago in order to serve more of the needs of the every day consumers, and where consumers will trust and not trust them, but for sure we're going to see some aggressive moves.

Stephanie:

That's a really good take about consolidation. I like that. What do you not understand today that you wish you did?

Hilary:

I don't really understand TikTok but I really wish I did.

Stephanie:

Someone just said that, I just did an interview about an hour ago and they said the exact same thing. Even they do really well on TikTok, their company does, she was like, "I don't understand it and it takes a long time to makes videos."

Hilary:

Exactly. I mean, I love it. I love the generation of content creators and I think it's really interesting that the shift is moving from influencing to actually creating, and I think it's certainly more democratic which is more in line with certainly the world that we believe in at hims and hers, but I would be lying if I said I came close to understanding it.

Stephanie:

We'll have to learn it together.

Hilary:

Yeah, deal.

Stephanie:

Because, yeah, I agree. What is your favorite book? It can be a business book or something where you're look, "I quote stuff from here. It's something that always come to mind when I'm making decisions." What's your favorite book?

Hilary:

My favorite book... Let me think, it changes all the time.

Stephanie:

Or you can have a couple.

Hilary:

I think the things I come back to frequently are The Five Dysfunctions of a Team, Innovator's Dilemma, and I think one that is earning a place on my shelf is the New Rules of Culture that Netflix just came out with.

Stephanie:

Oh, I haven't heard of that one. I'll have to check that one. Those first two are good ones. Very cool. All right, and the last one, if you were to have a podcast, what would it be about and who would your first guest be?

Hilary:

If I were to have a podcast it would be focused on people who use their energy to uplift and amplify other people, and to me there's nobody who does that better than Michelle Obama.

Stephanie:

That's great. I would enjoy listening to that. We need to make that happen, Hilary.

Hilary:

[inaudible 00:47:34]. I'll reach out to her. I'll send her a DM right now and see where we end up.

Stephanie:

Yeah, just DM her. We'll have this in the works in like a week, no big deal.

Hilary:

Yeah. That's the Hims pipeline, for sure.

Stephanie:

All right, Hilary, well this has been such a pleasure having you on the show. I knew it was going to be a good interview and you exceeded all my expectations. So, thank you very much, and where can people find out more about you and hims and hers?

Hilary:

Definitely, there's always so much going on, and thank you for all the thoughtful questions. Forhers.com and forhims.com and on our Instagram @Hims @Hers are always the best ways to keep in touch with the latest and the greatest.

Stephanie:

Awesome. Thanks so much for joining us.

Hilary:

Thanks, Stephanie.

Getting Into Shipt Shape: How Shipt More Than Doubled Its Workforce in a Matter of Months and The Impact it Has In On-Demand Grocery Delivery

info@mission.org (Mission) — Thu, 17 Dec 2020 08:00:00 +0000

At this point, it’s old hat to say that 2020 was a pretty wild year — countless industry experts have waxed poetic about the long-term implications of the acceleration of ecommerce we’ve seen this year. But Joe Manning hasn’t just been talking about adapting in the face of change, he’s working to make it happen.

Joe is the Chief Business Officer at Shipt, an on-demand delivery service that connects customers with thousands of grocery items and retail shops like Target, Best Buy, CVS, and national and local grocery stores -- and they do it all through a single mobile app. This year Joe has been on the front lines of scaling Shipt while still delivering not only physical products, but exceptional experiences to Shipt customers, employees, and partners.

Earlier this year, Shipt doubled the size of its shopper network to meet the growing demand for grocery delivery. And now, as the holiday season is in full swing, the company has added 100,000 more shoppers to its network. Not every company will have to scale quite that quickly or extensively, but ecommerce companies that will thrive moving forward will be the ones that are ready to jump into new markets, pivot quickly, and reach beyond their comfort zone.

On this episode of Up Next in Commerce, Joe explains what it takes to do just that, including how to maintain a culture of happy workers and customers as your company grows and changes. Plus, he looks at what is ahead this holiday season and why last-mile delivery is an area ripe for innovation.

Main Takeaways:

Super Market Sweep – When entering new markets, researching the dynamics of where you are expanding is a critical step. No two markets are the same, and each new market will require investments in different areas. Taking the time to get to know who your customers might be and what their needs are will provide you with a better idea of where you should invest your resources.
Happy Employee, Happy Customer – Even if you are employing mostly gig workers, helping to build a good culture and work environment should still be at the core of your business strategy. When workers feel supported and connected, they in turn will deliver better customer experiences, which impacts the bottom line.
Choose Your Own Adventure – The future of ecommerce is all about providing choice, personalization, and bringing the best of the in-store experience online. Companies that learn how to capitalize on the unique needs of every customer through gathering data, implementing technology and deploying resources — whether it’s last-mile delivery, seamless returns, or personalized shopping suggestions — will lead the industry.
Tech Talk – There will be more tech brought into the ecommerce experience, especially as it relates to grocery shopping. From barcode scanning, to robot shoppers, to maps to help customers navigate the aisles in-store, there is a lot coming down the pike.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hey everyone, and welcome back to the number one ecommerce podcast. This is your host, Stephanie Postles, co-founder at Mission.org. Today on the show, we have Joe Manning, the Chief Business Officer at Shipt. Joe, welcome to the show.

Joe:

Well, thank you. Thank you for having me. I'm very excited to be here.

Stephanie:

I'm excited to have you too. How many podcasts have you done so far? You seem like a good veteran.

Joe:

This is my first.

Stephanie:

Ooh, really? Oh, this will be fun then. I love having people on for the first time.

Joe:

Cool.

Stephanie:

So before we dive into Shipt, I was hoping you could kind of touch on your background at Starbucks because I saw that you worked there, I think, for over 10 years. And I want to hear what you did there, your role and some of your learnings that you got from there.

Joe:

Absolutely. So, I had the opportunity to work for 10 years at Starbucks. Starbucks was an amazing company. And one of the things that I really loved about what Starbucks did, and does, and how that applies to Shipt, Starbucks is very focused on the human connection between the barista and the customer. And they're great at leveraging technology. But as an enabler for a human connection. And I think at Shipt, we're trying to do very much ... We are doing very much the same thing. We are all about creating great connections between shoppers and customers, and we're a people-first organization. And we recognize the technology is a great enabler for that. But it is about the human connection.

Joe:

And so when I was at Starbucks, I worked in a couple of different spots. One area was the licensed stores business, which is the store inside a store. So, if you go into a Target or an airport, that business model I worked with those retailers to really build out those businesses. And then in addition to that, I spent a few years on the CPG business, which is the coffee and the aisle at the grocery stores. And that retailers and I led the business development area for that for a few years as well. And as I said, it was a great experience and the commitment to partnerships and the human connection was really impactful. And really, I think, gave me great insights to bring to Shipt as we started to build out the Shipt business.

Stephanie:

That's great. So what's one of your favorite memories or stories when you were working at Starbucks and trying to get Starbucks within the stores, or getting it on those supermarket shelves? What do you have a fond memory of or a funny story from your days there?

Joe:

Well, I'd say, I think one of the pieces that we really focused a lot on the Starbucks cafe experiences is very unique. They take a lot of pride in that customer experience. And so it was exciting when we would bring the stories to the retailers about how to operate at Starbucks or what the brand should be within the cafe. And we started to hear where retailers were then using the same terminology that Starbucks had been using. So, it was really fun when we started to hear them repeat back to us the words and the phrases that we had used, which really signal to us that it was going to be a great partnership, that they really understood what we were trying to accomplish. And that they were embracing that for their own business purposes, which was great.

Joe:

So coffee is at the core of everything Starbucks does. And I had an opportunity to go to a coffee farm in Costa Rica. And I got to plant a coffee tree and connect with all the farmers, or a lot of the different farms in Costa Rica where we sourced or Starbucks sourced coffee. And it was just really inspirational. I mean, it was fun to do for sure, but hearing the stories from the farmers about how their lives have changed because of their opportunities to partner with Starbucks was really inspirational and really made us feel good that we were making a difference around the world, not just creating great coffee or creating great experiences in the cafes.

Stephanie:

That sounds like a really good life-changing trip. Very cool. So what had you go over to Shipt? What led you to Shipt?

Joe:

So in about end of 2015, 2016, everything in Northern California was focused on the gig economy. Airbnb was growing, Uber was growing, and grocery delivery was starting to grow. And I don't know, about 20 years before then, there had been a grocery delivery company called Webvan that had had some success, but then it did not last. And I had been working with grocers, and it really felt like the time was right for grocery delivery to really kind of flourish. And I started looking around at different gig economy delivery companies, and I came across Shipt and Shipt was a small company. It was headquartered out of Birmingham, Alabama still is. And the founder was talking about how the quality of the shoppers and the personal experiences between the shoppers and the customers where was the competitive advantage that Shipt was going to capitalize on.

Joe:

And I really thought that that really resonated with me. I do really believe people have a personal connection to the food that they consume, the foods that they have in their homes, and creating that model. And it was different than what a lot of other companies are talking about. A lot of other companies were talking about the technology, and how technology was so important, and it was changing the landscape. And again, technology is important, but I really love the way Shipt talked about the personal connection, and the quality of the shoppers, and how that was the area where Shipt was going to invest, and it was going to win.

Joe:

And then when I met with the founder and I met with the company, the culture was just phenomenal, and it still is today. Everybody is passionate about the mission for Shipt and really focused on doing right, making a difference in the communities, passionate about building the business, but they recognize that it's really about helping people. And if we do that, then the business results will follow.

Stephanie:

I love the fact that you guys are so focused on giving a good quality shopper that I can feel a connection with. Because so often, when I order from certain companies, I'll get things like an avocado that's so soft. I'm like, "Who would get this? I would never pick an avocado this soft. Or I would never pick tomatoes with fuzz on them. You obviously do not care about my groceries." So, I feel a very close connection to having someone who ... A shopper that is looking out for my best interest, and actually picking things that I want, and not just being like, "Ah, there's five avocados, throw them in a bag, or they're fine."

Joe:

Well, that's exactly right. And that's what we hear from customers too. It's again, produce is tough to pick. And we put a lot of effort into supporting our shoppers so that they can get the right produce. And even the product is set up so that when we ordered bananas, we order a couple of green and then three yellow because we know we're not going to consume them fast enough. And our shoppers are graded, selecting that for us, and we get what we want. And it really is impactful because getting products that you don't want or that aren't going to work for you defeats the whole value proposition and the convenience of grocery delivery.

Stephanie:

So tell me a bit about how Shipt has changed over this past year because it seems like ... I mean, especially with grocery delivery, people really just had to rip up their plans, and start over, and be like, "This is the new world. Now I need to figure out how I'm going to do shipping." And everything seems so hard when it comes to grocery delivery instead of like Amazon, where they're all on routes, and they can deliver 60 things in a day versus a grocery delivery just feels so one-to-one. So tell me, what kind of shakeups have you guys seen at Shipt, and what are you doing to tackle them?

Joe:

This year has been unreal and, obviously, unexpected. And one of the first things that we did is we ramped up our shopper network. We doubled the size of our shopper network early when COVID had spiked, and we knew demand was growing, and we knew people were just desirous of getting products delivered. And so, we wanted to be able to support as many customers as possible. So we invested a lot to ramp up the shopper network. And even as we've gotten into holiday now, we're going to add another hundred ... We are adding another 150,000 shoppers this holiday season. And so, building up the shopper network was first and foremost and what we need to do to support the demand. But then, in addition to that, we worked really closely with a lot of grocers and a lot of retailers to help them succeed in this space.

Joe:

And to your point, it's a complicated model. And as you said, it's a one-to-one model. So there isn't the ability to drive around, for numerous routes all day long, you really have to put the care and effort into each individual order. And the order sizes are 25 to 30 items in the basket. And so we've worked a lot with retailers, not only to enable them on the Shipt marketplace to reach more customers. But we invested a lot in our last-mile delivery business, which we call Shipt Driven, which has really helped a lot of groceries. And a lot of retailers extend their curbside program to last-mile delivery. And that's really been impactful certainly through COVID. And we're seeing it even more so now during the holiday when again, there's a little bit more of a COVID spike. But then, just during the holidays, every retailer is trying to put together the pieces to support their customers and enable them to get the products they want in a way that works for the customer.

Stephanie:

Are you also helping advise some of these retail partners around coming up with the economics to make it work? Because it seems like a big Safeway has a very different model and how to get scale and efficiencies than a local grocery might have. Are you working with them to be like, here's what I see works? Here's how to make the model work for you guys.

Joe:

Absolutely. And you're right. I mean, we work with a lot of awesome regional grocers. And to your point, they don't have the scale of some of the national grocers. And so, in putting our programs together, we work closely with them to make sure that not only is it a good experience for the customer, but that it's economically beneficial and profitable business for the retailer. And we'll do that in a couple of ways. We'll certainly work with them on the technology and the integration to manage that so that it's as cost-effective where they get the best return on investment that they can. But in addition, we'll create marketing programs together. We'll do merchandising programs together to add items to the basket. And then, we'll collaborate on operations efficiencies so that we can pull out costs from the system so that it can be a profitable endeavor for them.

Stephanie:

So earlier, you were mentioning how you scaled up your shopper network. I think you said 100,000 shoppers, right?

Joe:

150,000 in holiday. And it was as a 100,000 earlier in the year. So 250,000, over the last six months or so.

Stephanie:

I mean, that's a crazy number, especially if you're trying to keep quality high. So how did you all go about hiring those shoppers? I mean, even finding that many people and making sure that they're going to be the quality shoppers that you want. How did you go about scaling like that?

Joe:

Part of what we did was implemented some enhancements to our recruiting process so that we were able to move through applicants much more quickly and thoughtfully, but while still ensuring we're getting the great quality candidates.

Joe:

We also invested a lot, as you would imagine in sourcing applicants, but we also worked with a lot of retailers back in the spring. There were a lot of retailers who were shutting down stores. And so, both our partners, as well as other retailers. We partnered with them to enable their employees who were looking for work to get fast-tracked through the Shipt application process so that if they wanted to pick up some Shipt shopping opportunities, they could, and they were great partners with whom we worked. And we got a lot of great applicants through that.

Joe:

And then another piece that we did ... Doing the first shop can be intimidating for folks if they've never done it before. And so, we have a lot of resources available for shoppers to access. And we continue to build on those, especially around how to enable the first shop. Because once you do a shop or two, you get into a rhythm, and you feel good about it. But it takes a little encouragement sometimes to do that first shop. So we put in resources to really make it as easy as possible for our shoppers to get out there and do the first shop.

Stephanie:

That does seem kind of scary doing that first one. So, I mean, how do you think about onboarding people? Did you have to set up all-new systems for all these new people? Did you have to change a bunch of things to scale that?

Joe:

Fortunately, we had the systems in place and in part because Shipt has been expanding rapidly since 2016. And even in, I think it was 2018; we were launching three to four markets a week for a good portion of the year. So, we had really good systems in place for recruiting shoppers building the network. And so, it was really more of just kind of amplifying that so that we could go even quicker during this period of time as opposed to having to build out new systems.

Stephanie:

Got it. So when you are going into these new markets, and you're launching quickly, what are some of the biggest issues that you encounter when you're going into the new markets?

Joe:

So new markets they're exciting, but they can be challenging. And one of the great things is the market dynamics differ. Launching in a New York City is different than Savannah, Georgia, for instance. And so, one of the pieces that we do is, when we go into markets, we'll spend time there to really understand the market dynamics so that we're thoughtful about our investments. Not only in how to recruit the shoppers to succeed in that market, but how to tailor our messaging so that it resonates with potential customers and that we're knowledgeable about the markets. And we've built out a market operations team that works and serves in all the different markets in which we operate so that we have the local knowledge that we can tap into.

Joe:

But one of the things that is super exciting as we launched markets is, we will do a market launch gathering a couple of days before. And then the night before, we launched the market, and the intent there is to get together with shoppers, to engage with them. So, we understand how they're feeling about launching this market and supporting us. We'll partner with the retailers in those markets with whom we'll be working. And it's really a great opportunity. It's a celebration of sorts. There's a great opportunity to connect with the shoppers and really help them better understand what Shipt is all about. Help them understand the retailers with whom we're working, and to get them excited about launching the market. And then back to the Shipt culture, part of what happens is there's just a whole group of folks who are working through the night to make sure the launch goes off properly. They're in the market for the next couple of days, picking up orders if we need to, troubleshooting if anything happens.

Joe:

And again, it's a celebration, it's a lot of work, but it's really exciting. And listening and engaging with the shoppers is really fun because you really get to understand who they are as people. And again, how enabling these jobs is really kind of making a difference in the communities in which we operate.

Stephanie:

It seems like a really good way to also build a community among those shoppers where they could potentially get to know each other, talk about best practices. I mean, do you cultivate the community of shoppers so they can kind of have their own little network? Can you talk to me-

Joe:

Absolutely. You're exactly right. We support the shoppers, and through various Facebook lounges, there are shopper communities. But you're right. The shoppers build such an amazing community amongst themselves. And it's great because they share best practices. They share tips. They're great resources for new shoppers who again maybe are a little bit hesitant or uncertain about how to operate. And then they celebrate with each other. And there's been instances in which there'd be a surprise party at a particular store because a shopper is just on their 5,000 shops or something like that. And we see the pictures of it and you see the shoppers. They're just so excited for each other, and they really do support each other.

Joe:

And they recognize that the stronger the community they build, the better the customer experiences are going to be, which is going to drive more volume, which is going to be supportive for everybody. And it's really exciting to watch. And we do think it's something unique that we've helped create as what we've seen with other gig economy companies. They don't put the same effort into supporting their shoppers or their gig economy workers. And we do think it's a unique advantage that we have.

Stephanie:

And I think that's a really good lesson for gig economy type of employers because I think a lot of people who do that work aren't really celebrated. And you don't see the person being really proud to be working on that because I think the company is not cultivating a community where people can be excited to actually showcase the brand and say, "This is what I do." I mean, I think about shoppers right now. You wouldn't know looking around Whole Foods or something, who maybe is a shopper, who's not, they're not wearing a shirt. They're not walking around proud for the majority of shoppers or even delivery drivers or anything like that. And I think that the moment that you start incorporating people to be proud of their job like that, and wanting to celebrate the other people in that network and community, you're only going to scale quicker and also build a good experience for everyone.

Joe:

Totally agree. Totally agree. And that's I think too often, some of the technology companies look at the gig economy worker as a cost. And we look at it the other way. We celebrate them, they're a phenomenal brand representation, and they represent our brand, and they represent the retailers with whom we work. And so, the more they feel good about what they're doing, the more we can help support them to do a great job. Often, it'll show up in the customer experience, and that's so hugely important. And so, we are excited about that, and we do provide Shipt Swag, let's call it because-

Stephanie:

It actually sounds better.

Joe:

For sure, the shoppers wanted it. And it's great. And again, I mean, it's brand building, but it's really more ... It speaks to how excited they are about what they're doing. And then the stories we hear from the shoppers, they feel like they're making a difference in people's lives. And that's invaluable to growing and driving the business. And so, we're excited about that.

Stephanie:

I think people view ... I mean, at least out in Silicon Valley ... And you probably know this Joe, since you lived out here. But swag being a thing of like, "Oh, you get so much of it." Employees don't even want that anymore. Don't spend money; it's a waste. They just throw it away or whatever. But I think they aren't thinking about the rest of the country who actually still celebrates a great t-shirt or hoodie and how important that is to them. And that's still a good technique to keep your employees engaged and excited to get something great.

Joe:

Absolutely. Absolutely.

Stephanie:

So let's talk a bit about customer acquisition. I saw a few articles where you were giving Shipt, I think, memberships to the elderly for free, which I was like, "Wow, that is genius." Because these are people who maybe wouldn't have engaged with grocery delivery ever before, but it's a good way to not only help them right now but also have a long time customer, even when COVID and everything's done. So how do you think about growing your customer base, getting on their radar, people who maybe would never find you organically?

Joe:

And so, one of the things that came out through COVID, there were a lot of people who tried grocery delivery for the first time. And we saw a large increase in the senior population as well. And it makes sense there may be a little less or a little reluctant to go out to the stores. And so, from that, we began talking to different agencies across the country who support the senior population. As well as talking to some healthcare entities and talking about how do we work together to build awareness about grocery delivery, make it easy for folks to get grocery delivery, support them economically? And so, that's been an area that we are continuing to invest in because we're seeing good results. And again, we know it makes a difference in the community, and the feedback we've gotten from the agencies and the senior population has been phenomenal.

Joe:

In addition to that, I mean, again, desire for grocery delivery has skyrocketed this year. Previously, Shipt was a membership only option you had to buy and an annual membership. During this year, we expanded to offer a pay per order option. And then you can also one order, or you can buy passes and get multiple orders. But we did that because, again, we knew people wanted to try the service. They weren't certain that it was for them, and either they wanted to try it because they were in a need state for it or because it was just new to them. But by enabling the PPO option, we have greatly expanded the number of customers that we're reaching. And it's really been, again, it gets back to supporting customers in a way, where they are today. And sell by providing the individual orders or the passes we've greatly increased the number of customers that are accessing the Shipt service.

Stephanie:

So how did you think about retention when it comes to ... I mean, I think that's great to be able to allow someone to pay for order. I know that would be something I would do. Is like try it at once and if it works well, maybe do the subscription, or maybe just keep paying for order. But how did you think about retaining someone who might just try it out and then forget how do you keep that customer around for the longterm?

Joe:

Absolutely. And with our members, the usage and the retention is phenomenal, and it makes sense. They've committed to the membership with the PPO customers. We are very focused on connecting with them and engaging with them so that we're giving them multiple opportunities to use this service several times. What we've found is using the service several times, it starts to become part of your shopping pattern. And so, part of what we do is we continue to connect, to communicate with those customers to make it worthwhile for them to try it a second or a third time if they haven't.

Joe:

And what we've seen, we've been very pleased. What we've seen is the transition from PPO to either multiple passes or Shipt Everyday, which is our annual membership, has been very good. And what we do find is as they use the service a couple of times, the quality of the service they're very pleased with. And so that gets them to kind of continue. But to your point, we're absolutely focused on how do we continue to connect and communicate with them so that they aren't one-time customers, but they become a much bigger part of connecting with us.

Stephanie:

So this past year, I'm sure you guys have noticed customers coming to you from many different channels. Like new channels are popping up to tax, not very big. I mean, where have you seen your new customers coming from, and how are you also trying to differentiate yourself from all the other competitors right now? Because I'm thinking, if I'm a customer, and I'm scrambling, like, "I need eggs." I'm just going to go on there and be like, "Okay, either I can just go on Amazon, because I already have a Prime account or let me just try, Instacart or whatever. How do you make sure to separate yourself, and really show your value, and also get on new and different channels, and finding customers in new ways where maybe other brands aren't doing that?

Joe:

We think the quality of the experience that we provide continues to be our competitive differentiation, and the quality of our shoppers is far and away superior to others in the market. We've always been very good at digital marketing, and we continue to invest there. We've also done quite a fair number of social media campaigns that have created different avenues and exposed us to different customer demographics that have been really beneficial. And then we've also leaned in more to traditional marketing as, particularly for the grocery space; we find that to be an effective channel. And so, in working with our grocers and exploring traditional media, we've seen some very good results with that. And so, it's really quite a credit cross-section of investments across various channels. But we're seeing good success across all the different channels in which we invest.

Stephanie:

Cool. I could see there being some fun campaigns with just an image of a dirty little brown banana and being like, "Did you just get this delivered to you? Come on over to Shipt. It'll never happen."

Joe:

Absolutely. And one of the campaigns we did, we talked about again the quality of our shoppers. And there were fun little snippets of how the shoppers will go above and beyond to get you the right product. And I think there was a version of it was tongue in cheek. But a shopper going into a lake to make sure you're getting fresh fish or diving into the freezer at the grocery store to get you the right product. And really trying to capitalize on the quality of the shopper is really beneficial because you want to get the products that you want, and not have somebody who's just focused on trying to get in and out of the store as quickly as possible, and throwing whatever in the bag to deliver it to you.

Stephanie:

So, with the holidays coming, you hear a lot right now with ecommerce about there's going to be a ton more demand for shipping. Things are going to get held up. How are you guys approaching the holiday season right now since you don't only do grocery, you do other things as well?

Joe:

That's right. And so, as we said earlier, ramped up the shopper network so that we can continue to support the increased demand. One of the areas where we've invested a lot in 2020 is in our last-mile delivery, so, Shipt Driven. And that's a program where a customer will actually place an order of the retailer's property or ecommerce program, and our shopper will arrive at the store and pick up the order and drive it to the customer's home. So it's basically extending BOPUS to last-mile delivery. And that business has skyrocketed this year. And we've got a great lineup of retailers that go beyond just the grocery side. So, we work with Bed Bath & Beyond, and Best Buy, and CVS, and Office Depot.

Joe:

And one of the things we're doing closely, we work closely with those retailers. We are managing, or we're partnering on forecasting so that we understand not only holistically what kind of volume we're thinking there's going to be, but even down to the store level because we'll make sure that we're hiring the right shop. Not just the right number of shoppers, but the right shoppers in the right locations. And then in addition, we are really focused between both the driven business and the marketplace on communicating that you can get products delivered the same day.

Joe:

And I think particularly in the next couple of weeks as other services are going to take longer to get products, we're going to communicate to customers that whatever product you're looking for, you can get it that day and at the last minute. Gifting ideas and through the holiday, ensuring that people are getting the products before the holiday arrives is a big opportunity that we're going to focus on from a Shipt marketplace standpoint. But also in partnership with our retailers on the last mile piece, because we can enable same-day delivery for those retailers as well.

Stephanie:

That seems like a really good opportunity there. And so many people are trying to figure out that last-mile delivery. What are some of the hiccups you encountered when setting that up? Because that once again seems like a very hard problem to solve, starting to work with all different kinds of retailers and solving that problem for them.

Joe:

So, fortunately, we've got such a great network of shoppers that on our side for the logistics that's the foundation is in place. I think what we find with retailers is they're standing that up, and how we work with them. Fulfillment costs can be daunting. And particularly on the last mile piece, the retailer needs to be prepared to collect those orders and ship those orders so that we can then drive at the last mile. So, we work with them to try to help them think through how to forecast and then how to plan for that fulfillment piece because that is an area that we have experience in. But in this model, they're going to be managing that. So that's one piece.

Joe:

And then, working with them on the operations and the handoff, it's not difficult, but we do put effort in there. Their store associates need to know who Shipt is, and why we're showing up at the store, and collaborating on how we connect with the customer to ensure that we're communicating effectively with the customer. Both on when is the order ready, when we're picking it up, when it will be dropped off, and if for some reason there are returns or other items that we need to communicate, setting up that structure so that we're all communicating effectively. So, that is a great customer experience.

Stephanie:

So you mentioned forecasting a couple of times. And you share those plans with the retailers to also help them plan for inventory, and like you said, fulfillment and everything. Is that a pretty standard process, or does every retailer in market ... Is everyone having a different kind of forecast or a training procedure to work through to be prepared this year?

Joe:

Yeah. So, we do collaborate with retailers, and we'll let them know what kind of volume we're expecting, and they'll share with us as well so that we can do what we can to manage inventory positions. Every retailer has their own process for that, but we have a dedicated team. We call it the Partner Success Team. They're phenomenal, and they work closely. Every retailer gets a dedicated team that supports them. And again, I think it's an area where we've invested more than a lot of other companies because these retail partnerships are so hugely important that we want to make sure they're getting the support that they need.

Joe:

And the feedback we've gotten from the retailers is that far and away, our commitment to details or thoroughness, and our communication exceeds what they see with other partners that they have. But on the forecasting, we'll work closely with them. We'll communicate the numbers that we're seeing. They'll share what they're seeing, and we'll review it, certainly right now on a weekly basis because if there's going to be spikes in demand, we want to be prepared for that so that we can create great customer experiences.

Stephanie:

That'll be interesting to see what happens this holiday season. So, where do you see the future of app-based delivery headed? What are you all planning for?

Joe:

So, everything we see through the pandemic, grocery delivery is certainly going to continue to be a huge part of the grocery industry. And I was thinking about there's in 2016, a lot of people in the grocery space didn't think customers would ever really embrace ecommerce that they needed to be in the store. They needed to see the produce they needed to choose it for themselves. And since 2016, so many things have changed. And so, grocery commerce is still going to be a huge portion of the business. I think projections are 2025. There'll be no more than 20% of the business. So we don't think I don't see anything changing there.

Joe:

The other ... But in addition, and we do work with retailers outside of the grocery space. What I think the pandemic has created is, retailers are building out a broad ecosystem of ecommerce solutions for the customers. They're recognizing that customers are going to want to interact with them and their products in different ways. And they want to let the customer choose how they want to get the products. And whether that's a third-party marketplace like Shipt, or if they want to do pickup, or having the retailers enable last-mile delivery through their own ecommerce programs. That, to us, feels like the winning strategy. That's what we're seeing, the retailers who are creating multiple options in allowing the customer to choose. Those are the ones that appear to be gaining a share and taking more of the business in the market. And that's where we see the future going.

Stephanie:

I've heard that quite a few times where the market is headed to where the consumers now know that there's options and they should have all the options and it needs to be the best option that they get to choose. And that wasn't something that even a year or two ago was something that may be a lot of consumers expected. So, I think that's a fun place where it's headed, though.

Joe:

Yeah, I agree. And I think that's it. I think awareness has grown so much so; customers are way more aware right now. And like everything else, they want to choose. It's the same if you go into a store, into a category. There's lots of options because consumers want to have the right to choose what they want. And again, I think the pandemic has kind of accelerated that mindset a little bit. Particularly as awareness has grown so much.

Stephanie:

So what kind of tech advancements are you all most excited about, or what tech enablements are helping your business the most right now?

Joe:

I think, again, I'll talk a little bit about grocery. But it's consumers want the ecommerce experience that's convenient and fast, and they want it to replicate their experiences in the store in the good ways. And so, some of the pieces that we're excited about substitutions, is a big portion of the shopping experience. It's about 76% of orders will have an item that's not available in the store. And so, substitution is an option there for the customer. So, we're enabling proactive substitutions to make that as seamless as possible. And we know it resonates because again, the customer wants to get the products and they want ... If you think if you're in the aisle, I can make a choice there because I'm looking across it. So how do we bring that to life through the ecommerce experience?

Joe:

And so we've enabled some features there, and we'll continue to build on that savings and loyalty programs continue to be a big portion. We look to integrate in with retailers' loyalty programs as much as possible. We know the consumers like that. And they want to get rewarded for making the purchase, whether it's inside the store or through Shipt. And so we're bringing that to life. And the other piece is continuing to find ways to enable exploration through ecommerce, it's still the early stage, but if you think about all the different touchpoints inside a store in which a retailer can speak to a customer, how do we bring that to life through ecommerce.

Joe:

And then the extension of that is personalization, especially in the food space, everybody's eating habits are very different. And so, how do we continue to capitalize on personalization so that the way my interaction in the app is different than yours based on my preferences? And how do we gather those preferences? But then also, continue to enable that, so that I'm getting access or information about the products that are most relevant to me. So, I think from a customer experience those are some of the areas that we're really excited about.

Stephanie:

Cool. It seems like imagery too, is, such an important piece of it. I know when I've ordered food before, if they ... I mean, why I go to the grocery store is so I can maybe look around and be like, "Oh, I didn't know I wanted that goat cheese and red wine type of thing. But it's so beautiful looking, and it's very enticing. I'm going to get it." And I think that's something where if it was in an app and it showed it right next to something, I would right away probably add to cart. But sometimes, it feels like that's still lacking of having the right imagery and being able to showcase it in a way that really makes me want it just like I would in the store.

Joe:

Totally. That's right. I mean, and image coverage is not where it needs to be. And again, part of it is for a lot of the industry they weren't really built for ecommerce. And so, they're moving quickly to enable elements like that, but you're right. I mean, that's such a huge opportunity. And then, even I think with the patterns that may be the pandemic have created there's a lot more eating at home. So how do you continue to find variety and give consumers various options that fit in with what they want, but they may not be thinking about on their own? And I think that will continue to be a bigger opportunity. And I think that'll last post-pandemic as well.

Stephanie:

Do you know what I want? I want a surprise me button. I want my shopper to know me so well where I'm just like, "Here's $3, surprise me with something." Because that's why you go to the grocery store. Sometimes, you feel like, "Oh, I'm pleasantly surprised by what I just spent on like ..." Can my shopper do that for me?

Joe:

Totally, absolutely. And so, you should try it out. We have a special request portion of our product when ... So you can ... If for some reason you're not finding a product that you need, or if you have a special request, you can put that in. And so, you absolutely should. And I think the shoppers would love that. They totally enjoy that. And I mean, we've got two dogs, and there's a handful of shoppers that we see regularly, and the dogs love when the shopper pulls up because they know that food is coming, which they're excited about. But also, the shoppers have multiple times picked up a little treat that they've seen for the dogs. Because they just think it's fun. And so, you absolutely should test that out.

Stephanie:

That's fun. And what about things like personal barcode shopping and things like that, or ways to make the shoppers more efficient? But then you have to partner with retailers to enable that. Are there any technologies in that area that you guys are exploring right now?

Joe:

Yes. And so, creating the efficiencies is a big focus area for us and will continue to be. And so, a couple of the areas, you had hit on like the product catalog, and imagery, and attributes for the products, that's an area. But for driving the efficiencies, we work really closely with the retailers and out of stock information. We have real-time data because we have shoppers that are in the store and they're looking for particular products. And so, we share that with the retailers to help them incorporate that in with their logistics information to try to reduce out-of-stocks. And we've seen some really good results with retailers where our data was helpful as an additional data point to solve some out-of-stocks. And so that's a big area that we focus on.

Joe:

Getting good IO location data is really helpful for helping the shopper navigate through the store. And so, we'll work with retailers on that. And then, I think your barcode scanning, we call it scan and go technology. We've enabled that with a couple of retailers, we're going to continue to build on that. And that is just so helpful for moving through the store more quickly, reducing checkout time, and reducing some of the labor costs in the store because the more that we can simplify the checkout process, that's labor savings with the retailers. And then, we're at the early stage of looking at other kinds of automated opportunities. And how do we take advantage of some of the investments that the retailers are to generate efficiencies?

Stephanie:

I see. And they should [inaudible] Bigger ones like Walmart were experimenting with having robots going down the aisles to map the store and take inventory. But having just so many issues depending on things were all jumbled behind the one that was near the aisle or how high the aisles were. And it seems like a big problem to solve, but something that could really help a lot of ... Especially larger retailers like the Costcos of the world, who just have so much stuff to inventory all the time and are constantly running out of things.

Joe:

Absolutely. And that's I think the bigger stores. But even the traditional grocery store could have 45,000, 50,000 skews. So it's such a big opportunity. I think there's going to be a lot of investments and especially as ecommerce has grown. Again, in many ways, the grocery industry is still early in the ecommerce space. And so, I do think there's going to be a lot of good technologies developed that will really help generate efficiencies, which will ultimately be a great win for the consumer because the efficiencies will drive down costs.

Stephanie:

Yep. I agree. All right. Let's move over to the lightning round, brought to you by our friends at Salesforce Commerce Cloud. This is where I'm going to ask you a question, and you have a minute or less to answer. Joe, are you ready?

Joe:

Yeah, I'm ready.

Stephanie:

All right. I feel like you're on a roll. So I'm going to start with the trickier question first. What one thing will have the biggest impact on ecommerce in the next year?

Joe:

Well, the pandemic is certainly going to continue to have an impact on ecommerce. But I think ultimately, it will be how quickly retailers can continue to build out a broad ecosystem. And I think that's what customers are looking for. And I think those who move quickly to enable that will be most successful.

Stephanie:

What is one of your favorite business or management books that you refer back to from time to time?

Joe:

Well, it's funny. I just had this conversation with somebody with one of my peers and we were talking about strategy, and Art of War is something that I have on my bookshelf, and I do refer to it on an ongoing basis. I just think it's ... I mean, it's a classic, but I find it to be really beneficial.

Stephanie:

I love that one. What do you not understand today that you wish you did?

Joe:

Oh gosh. There's not a limit there. I think the piece that I want to continue to more broadly understand is the customer buying patterns across retailers and how that will continue to change. Everybody's got their collection of retailers that they shop for. And I just had this conversation recently because we were driving down the road, and there was a little strip mall that we've never really gone in. Those stores, I'm sure, are great. It's all part of our pattern. So the psychology behind creating the patterns and the behaviors, and then what would it require to disrupt that.

Stephanie:

That's a good answer. I like that. If you were to have a podcast, what would the podcast be about, and who would your first guest be?

Joe:

So I-

Stephanie:

I think you've thought about this-

Joe:

I have. I think podcasts are awesome, and I'm so envious. So, an area that I've found to be more interesting of late, I kind of stumbled across this street art. And so, Denver has got a really good community of street artists. And so I think it's super cool. And if ... I mean, my goal and I would love to meet Banksy, who's a street artist out in the UK. And that's if I could have him on my podcast. That's how I would do my one episode, and I'd be done.

Stephanie:

Like mic drop, I'm good.

Joe:

Exactly.

Stephanie:

That'd be a good one. All right. And then the last one, what is the favorite app on your phone?

Joe:

So, my favorite app, I don't know if I should say, well, DraftKings is recently become legal in Colorado. I have two boys. And so, we like pro football. And so, every Sunday, we choose a game and put 10 bucks on it. And so that is ... It's probably not the best family forward kind of thing, but we're having fun with it.

Stephanie:

Sounds pretty family forward to me, so, you can do what you want, Joe.

Joe:

So let me know if you have any recommendations because we haven't been winning the last couple of weeks.

Stephanie:

Oh, man. You don't want recommendations from me. Trust me. I'll let you guys do your thing there. I'll trust you. All right, Joe. Well, this interview has been great. Where can people find out more about you and Shipt?

Joe:

So Shipt.com and download the Shipt app. And then I am on LinkedIn, and Joe Manning chipped up on LinkedIn.

Stephanie:

Awesome. Thanks so much for coming on.

Joe:

Thank you. I really appreciate it.

Breaking Through Amazon Barriers with Ju Rhyu, Co-Founder and CEO of Hero Cosmetics

info@mission.org (Mission) — Tue, 15 Dec 2020 08:00:00 +0000

How to succeed on Amazon is a mystery that many DTC brands have tried and failed to solve. There are tricks to winning on the mega ecommerce site — tricks that no one tells you when you first put your product up for sale in the Amazon jungle.

That’s why we’ve invited Ju Rhyu on the show. There were a lot of things that Ju wished she knew before she and her co-founders decided to launch Hero Cosmetics on Amazon. Things like what is brand gating? And how do you win the buy box? And what do you do about counterfeit products that pop up right when you start to have a little success?

Ju found the answers to all of those questions and learned so much more as she grew Hero into one of the buzziest skincare brands on the market, which went from 0 to $1 million in year one, and now not only sells on its website and on Amazon, but is also featured in retailers like Target, Madewell, CVS Pharmacy and more.

On this episode of Up Next in Commerce, Ju spills the beans on what it takes to win big on Amazon, and how you can level up from there.

Main Takeaways:

Boxing Out Your Opponent: On Amazon, the first steps to success are winning the buy box and brand gating. It takes time, but if you take the steps to prove that you are the true owner of your product or IP, you’ll be able to avoid much of the pain that comes with selling on Amazon.
If You Build It, They Will Come: Getting your product into retail locations is a mix of luck, perseverance, and creating your own destiny. Relentlessly pitching your product to anyone who will listen, and then jumping on trend-seeking retailers is a strategy to get your foot in the door. Also, having a PR strategy to build buzz may help drive interest in your brand.
Far Out Future: Because 2020 accelerated the adoption of ecommerce, DTC brands are in a position to set the stage for where business is headed. From bike delivery to the creation of a DTC mall, Ju has a lot of predictions on what to look out for down the road.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hello and welcome back to up next in ecommerce. This is your host, Stephanie Postles co-founder at mission.org. Today on the show we have Ju Rhyu the co-founder and CEO of Hero cosmetics. Welcome.

Ju:

Thank you. Thanks for having me.

Stephanie:

Yeah. I'm really excited that you took the time to call in from Paris. That's so fancy when I say Paris, maybe you're like, this is normal for me, but you feel fancy.

Ju:

It was a fun fact that I tell people, "Oh, by the way, I live in Paris."

Stephanie:

So tell me a little bit about Hero. I would love to hear the founding story of how you started it. I mean, it has tons of news coverage and I was reading so many different stories. And I want to hear from you though about how you came to found it.

Ju:

I mean, the story is I was living in Korea. I was working there as an expat in Seoul, South Korea, and I was suffering from adult acne. I don't know exactly what was causing it. Maybe it could have been the changing environment, the lower air quality change in lifestyle, or maybe stress, I'm not sure. I was really frustrated because I kept breaking out and it was always just hard for me to find a solution that worked for me. But in Korea I noticed a lot of people walking around with these acne patches on their faces. So I got really curious. I went to a pharmacy, I bought some, and then I was just amazed at how well it worked because it sucked everything out and protected me from touching the area and picking at it.

Ju:

It was really gentle on my skin. And then I immediately started wondering why I was learning about it then, and not like 15 years ago and why it wasn't more available in the US so I did some research and then that's when the idea of like, Hey, I should make this available in the US I think people would really like it.

Stephanie:

That's so cool. I mean, it seems like Korea, all the beauty trends right now are coming from there, everything when it comes to double cleansing and [inaudible]

Ju:

Well, the 12 step regimen.

Stephanie:

Yes. I try to follow the 12 step regimen. And I got a little overwhelmed. I'm like, Oh, this is a lot to clean my face. So you found this product in Korea. What did you do next? How did you have the idea? Because a lot of people find other products in other countries. I know, I at least have, or my oldest T brands really good, or Oh, this hammock is really good, whatever it may be. And I don't always think, I'm going to bring this back to the States and do this. So what were your next steps? Why was this the product that you wanted to bring back and start?

Ju:

First of all, for me, it solved a real problem that I was struggling with it worked better than anything else I had ever really used. And I just got to thinking if this is helping me, this could probably help a lot of other people state side as well. And then actually in Korea, when, if you're a cosmetics manufacturer or distributor, you're obligated to print the name of the manufacturer on the back of your package, that is not true in the US actually. And so the first thing that I did was I started contacting these patch manufacturers to see how much it would cost to buy them from them, how the manufacturing side would work. If they could work with me to develop something that I thought would be suitable for the US market. So I went to a bunch of pharmacies. I bought up a lot of packages. I looked at the backs of the boxes to see who the manufacturers were. And then I started my outreach.

Stephanie:

What were some of the biggest surprises when you're reaching out to these manufacturers?

Ju:

I mean, a lot of them didn't return my calls or my emails. I don't blame them. I mean something like random person contacting them about buying up a much of their patches for a business idea that was still very nascent. And so that was a little bit frustrating, but there were a few that did reply to and then there was a little bit of a language barrier just because I mean, I'm Korean American living and I was living in Korea. But my Korean isn't totally fluent. And so a little bit of a language barrier, but I got really lucky because I landed on the manufacturer that we work with today, who was more than happy to get my email was super easy to work with was very open and developing relationship. And that's how, probably how we got to where we are today. From that one cold email he happened to respond and we've been working together for now over three years.

Stephanie:

Oh, wow. That's really cool. So were they open to creating custom packaging? Because I know when I've looked into this space before, it seemed very black and white. You can have our packaging or something very expensive, but like it's still going to be our design. How willing were they to have something really custom?

Ju:

They were pretty willing. They were willing to customize design and basically customize anything that we really wanted. So they were pretty open to that. This is their business, they make products for other companies and other brands. And so they were pretty familiar with how that whole process works.

Stephanie:

And did you end up using a very similar or exact product of what you got in Korea that you started selling here? Or did you make any updates or changes?

Ju:

Yeah, I worked with the manufacturer to adjust to some things I thought were really important. So things like the adhesion or the stickiness or the absorption power of the actual patch of the hydrocolloid patch. So there were some customizations that were made for this product because I definitely wanted to create like the perfect acne patch. And that's how we landed on what we have now.

Stephanie:

That's great. And do you feel like you had a leg up because it looked like you've been working in the world of digital and e-commerce prior to Hero. Was there anything that you learned from your past life before Hero that you brought into founding the company?

Ju:

Oh yeah. All the time. So my background is I actually got my MBA at Columbia business school and then I worked in corporate America for a really long time. So I worked at Kraft foods, American express, I worked at Samsung. That's what brought me to Korea. And I mean, I still lean on my, on all those experiences. I lean particularly on my Kraft foods experience because that was in brand management where they train you in a certain way of thinking for marketing. So, consumer is always first to teach you about the retail landscape and there's a distinction between your consumer and your customer. They talk about like the brand ladder. There's so many things that I still fall back on and use to this day. And then for some of the other companies, things like processes or even knowing about email and open rates and how to really digest analytics like that, are things that I still use today.

Stephanie:

That's great. So I'm going to get a little crash course in craft methodology. So earlier you just mentioned distinction between consumer and customer. What do you mean by that and how do you practice that?

Ju:

Yeah, it's funny because in my mind they're very different, but I know sort of in the public, they both get used interchangeably, but the way that a lot of these CPG companies work is they didn't exist before at DTC world. So they always sold through a retailer like a Walmart or Costco or target, et cetera. And so those retailers were always referred to as the customer because those were the people that were actually buying your product. And then you would refer to the consumer as the end-user of the product. So the person who would inevitably eat your Oreo cookie or use your Clorox cleaning solution. Usually the consumer ended up being the consumer of the retailer. So it's really not like if you're working at Kraft foods the consumer is not technically your consumer. I mean, it is, but by way of the retailer. And so that distinction was always very important when it was written out.

Stephanie:

That's good. All right. So you've got your manufacturer, you've got your product being built. What next?

Ju:

Yeah. I have two co-founders Dwight and Andy, and then I do a lot of the product, the marketing, the PR basically the sales person. Dwight handles a lot of the supply chain ops. And then Andy, he does all our design and creative. So we had gotten together we decided the three of us were going to do this. We had the product concepts so it came. So the next thing was to come up with the brand and the product name, the brand name. And for me, it was really important that we choose a name that was very like evokes emotion or something emotive because I felt like acne was a very emotional category. There are a lot of people who feel bad about themselves or feel insecure when they have acne.

Ju:

And so I wanted a name that was really, I don't know like instilled confidence or was like a just evoked positive emotion. And so that's where we came up with the name Mighty Patch. And then we had to create designs does on the box really kind of create the whole brand feel of this product. And then the initial strategy was we were going to sell it on Amazon. So we launched it on Amazon. That was how we were going to distribute it. And then once we had the distribution part then came the other part, which is how do you sell it? So we had to get people to know about it buy it, leave us reviews and things like that.

Stephanie:

So let's dive a bit into launching on Amazon because I always hear very mixed emotions about selling on Amazon. And I want to hear your thought process about, starting their first. And did you do research on the platform to kind of see, what the space was like? Like what kind of things did you go through before deciding like Amazon's actually a good spot to start?

Ju:

Well, so we started this business almost like a side hustle. It was a side hustle and we were bootstrapped, we didn't raise money. And so for us, Amazon was like the most logical place to start because you have access to hundreds of millions of buyers. It doesn't take a lot of resources or investment to launch on Amazon. You can take advantage of their backend, like warehouses and fulfillment centers to help with the fulfillment part. So for us, like Amazon made so much sense and then also, back then it wasn't... we just had a hypothesis. And the hypothesis was that if we bring this product category to the US and position it more as a beauty product that it could do well.

Ju:

And so for us, the easiest way to test out that hypothesis was on a platform like Amazon. So rather than having to spend all the money to build a website and find a three PL and do things like that, the easiest and quickest way to test out our hypothesis was to put a page on Amazon. We said, let's see if people buy it. If people buy it, then we'll work on phase two, which would be launching a DTC channel.

Stephanie:

That's awesome. I think that's such a great way to have that, like MVP products. See if it works before investing too heavily into a big website and yeah, like you said, setting up three PLS. What kind of hiccups did you experience when you launched on Amazon or started that process?

Ju:

So one was we actually proved out our product market fit very quickly. And we actually ran out. We either I can't remember, but I think we almost ran out of inventory or we did run out of inventory. We had like our second order on a boat and it was supposed to be released, but like the timing didn't work out. And so it was really, really tight in terms of inventory planning. The other issue was we were getting people were now brand gated, but before we were brand gated, we're getting people attaching themselves to our listings as we were getting more and more popular. And so I don't know how many people know how Amazon really works, but a lot of times when you have a product page, it's not something that you own, unless you're brand gated.

Ju:

It's something that other people can sell that product, leveraging your product page. And then the idea is yeah, everyone has to win the buy box. And the buy box is when you're on an Amazon product page, and you add to cart, the person who's winning the buy box is the first person whose product you would add to your cart. So I didn't know any of this when we first started, I was like, why do you have to earn the buy box?

Stephanie:

I had no idea. I mean, I see that from a consumer side where it's like, you have other options, but I never go to those. It's like whoever's first is who I go with.

Ju:

Yeah. And it's really smart on Amazon's part, because as a seller, you have to earn it either by having really good reviews, like seller reviews or you have to earn it by having the best price. And so there are a lot of sellers, they'll price a penny cheaper, or like 5 cents cheaper, and then they'll win the buy box. Which inevitably is a very dangerous game because you can just sort of discount this product to zero. So anyways, we were getting people attaching themselves for a page, which wasn't good because we wanted to protect our products and our IP and all that. And then the other issue that we ran into was we started getting counterfeits mixed into our inventory. So there was a time where and I have a photo of it. It's like someone had literally ripped off our designs created like their own version of our box. I'll be at the designs were not like you could tell that it was fake. It wasn't a perfect copy. But somehow it had gotten mixed into our inventory. And then that fake product was getting shipped out to customers.

Stephanie:

How is that happen? I mean, was that like on the manufacturer or how does it get mixed into your inventory?

Ju:

I don't really know, but I think what happens is they probably attached themselves to our page at that time. And then won the buy box and started shipping this big products to these customers. I think some of them were returned, like people would return them and then it'd get mixed into our inventory that way.

Stephanie:

Oh, that's tricky. Yeah, because I've seen that in reviews on Amazon where people would be like, this is the authentic one. I've been buying this for five years and now it's a knock off. And I'm like well, how's that happened? But I guess he just didn't understand how that could happen, where I'm like well, the brand wouldn't have a knockoff, but yet now knowing how the buy box works and yeah, that can be really tricky. So how did you get those people off of your page when they started attaching themselves to your page? Like what did you do to rise above them?

Ju:

Yeah. So there's something that you can do on Amazon called brand gating. And you have to prove that you own the IP or the trademark to your brand name. So you present them, you submit all the evidence and then they will brand gate you, which means that you are sort of no longer a public page where people can attach themselves to your page. You and only you can can moderate or edit or sell on your page. And so that's what we did. And then since we've done that, it hasn't been a problem.

Stephanie:

Well, that's a really good lesson for anyone new trying to start out on Amazon. That is a possibility. Very good to know. So what's changed on Amazon since you launched there in 2017, what kind of things have changed?

Ju:

Well, our category now has just exploded. And it's funny because in September when we launched this September, 2017, it was us and maybe like one or two other products when you looked up acne patches, but now when you search for acne patches, there are like pages and pages and pages of acne patches that show up in the search results. And so sure competition [crosstalk 00:19:00]. We're the best seller, we have the best-seller badge.

Stephanie:

How did you get that? Just from actually being a bestseller or was there anything else behind that. I'm thinking way off course by looking at the Amazon page now.

Ju:

Yeah. So it's like a three-pronged strategy. One is you need to support your product and your page within the Amazon paid media ecosystem. As you need to run your sponsored product ads and your display ads. And so there's a whole advertising strategy. The other is you have to optimize your organic content. So your product titles, your page titles, your descriptions have the right key words, a plus content, video content, images. So that's the second strategy. And then the third part is kind of building your outside ecosystem. So having press point to your Amazon page or having influencers talk about your product and being available on Amazon and just sort of building your brand halo. So you have to be relentless. It definitely takes time. It took us about a year to get the bestsellers badge from the moment where we really started going after it.

Stephanie:

So let's talk a bit more about the competitive space, because like you said, beauty is very competitive. So many people are launching products. Like what do you all do to stay ahead from your competition?

Ju:

We will look at our messaging a lot. We always want to be sort of one step ahead in terms of how we message our products, why we're better really talking about our differentiation. We're also really evolving in terms of product portfolio. So we're best known for our patches, obviously that's whatever it is our bestseller on Amazon and elsewhere. But since then we've launched a lot of other products with like we have rescue bomb and then lightning won and then we're coming out with a bunch of other things next year to really build kind of a routine and regimen for acne. And so, I get the question a lot, like, why is your patch different from others? Like tell me about the patch. Like, they just want to know about the patch, but part of my job these days is really telling people that we're about much more than just the patch, we're really an acne brand. And so I think that tactic is something that is also differentiated from a lot of other competitors out there who may only have like a single patch product.

Stephanie:

Yeah. [inaudible] great because it shows that you're really invested in that whole market and you are always finding new products to offer to your customers, which is only going to help. Like how do you go about developing those new products and know what your customers want?

Ju:

It's a mix of art and science. It's some of it comes from well... We have a great PD team, product development team. Part of it comes from sort of research where we're always looking and reading at trends. And we're trying to react to white space that we see in the market. Part of it also just comes from our collective acne issues. Like sometimes I'll break out and I'll say, I really wish I had a product that did this. Why doesn't it exist? And then I'll talk to product development team. And then we'll create something that addresses that issue. Some of it also comes from research that we do with our customers or our consumers, excuse me. Well, we'll ask them what are you looking for? What else do you want to see from us? What other types of acne issues do you have that we could solve? So it's a little bit of like intuition comes from our own experiences. Some of it comes from data. It's kind of there's no perfect recipe, I guess we're coming up with your products.

Stephanie:

Yeah. Cool. So let's shift over a little bit into more wholesale deals and getting in retail, because I saw some of the retail locations that you're in, like Madewell and target J group. Very impressive. And so I'm sure everyone's like well, how did you get into those retail locations?

Ju:

Yeah. Okay. So we launched on Amazon September, 2017. I immediately started pitching retailers our product, and then anthropology was actually the first one to take us in January of 2018. And they took us as a-

Stephanie:

That's quick.

Ju:

Yeah. It was really quick which again, for me it just affirmed the idea that there was a need in the market for this type of product.

Stephanie:

What was your pitch? Tell us the magic.

Ju:

It was really like just a cold pitch email telling them what the product was, what it does, why it's gray included a picture in the email. So they had a visual really just use concise bullet points. And I mean, that's kind of it. I didn't attach a deck or anything like that.

Stephanie:

And did you have any data that you included that maybe won them over?

Ju:

I think I had talked about how acne patches in Korea were... so back then KBD was really hot. And I think I'd talked to them. I think I had mentioned that acne patches were really popular in Korea and that and there was a Korean brand that was quite popular. And so I wanted to bring like an American version of that product to the US so in a way that, buyers are usually trend seekers, they pay a lot of attention to the trends of their category. So I think she knew that acne patches a developing an emerging.

Stephanie:

That's great. So you got anthropology as your first retail partner. Was it easier to get the rest after you could point to anthropology and be like, see we're in here?

Ju:

I mean, it's definitely validation gives you street cred. But I think in 2018 when we launched in a lot of specialty retailers and I credit that to I'm a big believer in, if you build the demand, the retailers will come. And so once I started our PR push and we were mentioned in, into the gloss and business insider and Buzzfeed, I actually started getting quite a bit of inbound requests from buyers. So I remember like American Eagle was an inbound J crew, I believe was an inbound, Neiman Marcus was an inbound. So as we started getting more press and becoming more known on Instagram and things like that I actually started getting pitched from these buyers. They would email me and say, Hey, I heard about your product. I really want to try it. Can you send me some samples? And so that was sort of special.

Stephanie:

That's awesome. So how did you get this press to get in front of them? What kind of avenues were they finding you on, like, were they finding you from Instagram or was it actually in these articles that were somehow ending, ending up on their computer screen? How did that work?

Ju:

So there's a service that I used called Launch Grow Joy. I recommend to, I recommend them to like every entrepreneur that I've talked to, because it's sort of like DIY PR so you pay like a monthly or yearly fee, you log into their system and then they give you access to all these editors that are looking for content or products to talk about in their next article. I did all the pitching early on and like had mentioned before the first article that we really got was an into the gloss. And immediately after that article went up, I think I got like two or three inbound emails from retailers saying, Oh, I just read about your product. I really want to try it. And so I think if you know, what the buyers re like, usually depending on your category, they read certain things to know what the trends are and to know what's like new. So for beauty.

Ju:

And so the gloss is it's a publication that a lot of people read. And so I just got really lucky, I think with that first article and then just started pitching other beauty related publications and then sort of build [inaudible]

Stephanie:

That's really great. So now you're in many retail locations at that point? What kind of lessons did you learn that maybe you took to new retail partner you got?

Ju:

That's a good question. I think packaging is really, really important. I think that's why initially I think we stood out because our packaging was very colorful and it was very bright. And then it was pretty clear with product did on the packaging. And so for me, like anytime we make a packaging change, I always run it by our buyers. So when we launch new products and we're looking at a different color scheme or something like that, I'll always send it to our buyers to get quick feedback, because they'll know if it'll do well or won't do well. So that's a big one.

Stephanie:

Do you change packaging based on different retail locations whatever connects with anthropology might be very different than target.

Ju:

No, we don't, maybe we'll do different pack sizes, but we won't really change the design. So I think that's a big one. I mean, I've learned that working and staying close with the buyer is really important because they'll have a lot of input into your innovation too. Because, because sometimes like they're looking for a certain type of product and then they'll come to you and they'll be like, Oh, we'd love this. We'd love it if you made X, Y, Z product. And so I try to stay close with the buyers on innovation pipeline. I think it's really important to hold price. We started selling on Amazon. And then I actually was very worried in the beginning that no one would take us because we were on Amazon, because to your point, a lot of people have this love, hate relationship with Amazon.

Ju:

But actually what I found was that no one had a problem with it because we're three on Amazon. So we sell on their marketplace. Therefore we control the price because we could control the price. A lot of other retailers were okay with it. And in fact, they kind of see Amazon success as validation that it will probably do well at their store as well.

Stephanie:

Yeah, that makes sense. Very cool. So now with where the world's at today, and a lot of retail locations, declaring bankruptcy, what are you guys experiencing right now? And what's your go forward strategy?

Ju:

Yeah, this year has been an interesting year. We're luckily one of those businesses that actually benefited from COVID in a way and really two reasons, I think one reason is our distribution strategy. So the biggest channels that we sell in which are D to C, Amazon and Target are, they were always online or they never say it another way. They never had to close this year because like Target was considered an essential retailer, Amazon, they're online and then D to C is online. And so luckily we weren't a company that depended heavily on a retailer that did have to close so that, so we saw minimal impact. And then in fact, like, as these essential retailers, they get stronger. Our business actually just gets stronger as well. And then the other issue is since we all have to wear masks the masks because acne, and there's a term that people use is called [inaudible 00:33:08].

Stephanie:

Have not heard of that.

Ju:

Have you not? Its called [inaudible] And it's caused by either like the friction. So when you wear the mask, sometimes it rubs on her face and it causes friction and then that'll cause you to break out or I don't know if you've noticed this, but when I have the mask on it, it creates humidity when you talk like when you talk and when you breathe, it creates humidity. and that humidity gets trapped and creates bacteria, which causes you to break out. And so we've seen a lot of people suffer from mass MI looking for a solution and then they end up finding our products and our company. And so that's another reason why we've actually benefited from COVID in a way.

Stephanie:

Oh, that's good. So are you going after the masks masks me keyword or any other cameras coming?

Ju:

Yeah, actually when I first heard about maskne I don't know, maybe it was like April, like may or something like that, I immediately told my team and I said, Hey, we need to double down on this, on this word, let's write a blog post, let's do social content. We need to own maskne. I think we were the first ones probably to come up with like content around maskne and to do, to even create a bundle on our website for a mass me. And then since then I've seen some other people do that, but I saw that as definitely an opportunity for us.

Stephanie:

Yeah. That's, really good. So I want to move over into the mentorship category now, because I saw that you have Jamie Schmidt as your mentor and she created schmaltz and she started in a farmer's market and then ended up selling it to Unilever. So amazing mentor. I want to learn a bit about the types of things that she's guiding you on or the most memorable pieces of advice that she's given you.

Ju:

Oh gosh. So she helps me a lot with distribution because she also obviously had built and sold a company that's similar in terms of distribution strategy. Like they weren't just D to C. They also sold that big box retail and had a pretty extensive they had extensive distribution. And so I remember when we did a mentoring session for Inc magazine, one of the questions I asked her was around like succeeding at target and how to do that, how to ensure success because it's a really important relationship. You want to make sure you get it right. You don't really have a second chance. So she gave give a lot of really good advice and tips on that and also how they support it.

Ju:

I remember her saying that they ran a lot of geo-targeted ads and some of the top like 50 or a hundred stores to drive traffic to, to the target stores. So that was a really good idea. And even, even now I hadn't recently sent her an email about sort of international distribution, because I know they have quite a few international distributor partners how to navigate those relationships what those relationships should look like. And then people should definitely follow her on Twitter. She gives a lot of really good advice on Twitter for free. So I'm always following what she tweets.

Stephanie:

She's very smart. I follow her as well. So what kind of thoughts did she have around expanding internationally? And are you working towards doing that or are you already international?

Ju:

We're kind of international, like we sell on Amazon Canada, we sell at Liberty London in the UK. It hasn't been a big push for us just because US market alone is so big and then we already have so much work. But it's definitely something we have our eyes set on just because for us, acne, we want to make our products available for anyone who has acne. I think they really do help people who break out. And so that's obviously not just limited to the US it's really a global problem. Anyone who breaks out should be able to access our products. And so it is, yeah, it's in the strategy for sure. I think it's a matter of prioritizing it when we have the time.

Stephanie:

Cool. And so by taking a product that you found in Korea and bringing it back here, it seems like there'd be a lot of room to go other places and be like oh, and here's another product I can bring to the US and another one, like do you ever get tempted when you travel or traveling to buying other products and be like this worked once. Why wouldn't I just launch more things on Amazon?

Ju:

Yeah, I haven't had a product idea yet, but living in Paris I do see things here where I'm like oh, wow. I wish I could introduce this to the US. I think it could do really well.

Stephanie:

What are some things in Paris doing well, or unless you don't want people to steal your idea because we have many customers who might, I don't know.

Ju:

Well, I'll say there's a retail idea. There's a retail chain that does quite well here and that doesn't exist in the US and again, it was sort of the same thing. I'm like, why does it exist in the US? And I think you're right. I think that's like one of the great things about traveling is you get to really explore and learn a different culture and discover different products or different services that could be adaptable to a different country, a different market. And so I kind of have two ideas that are kind of like that already.

Stephanie:

All right. So I want to move into a couple more like higher level ecommerce questions because you've been in the industry for awhile. I want to hear what kind of trends or patterns are you most excited about right now?

Ju:

I think there's a lot of cool stuff in food that's happening. I think I'm really interested... For me personally, I'm really interested in the environment and sustainability, and I see a lot of cool ideas around local delivery by bike. So it's zero emission. It gets a product from point A to point B. It is a lot more sustainable. I think that's really interesting. I think food again is also interesting. And especially with COVID and this year and how I think the uptake with buying food online has probably skyrocketed. I think there are a lot of people who weren't used to doing their groceries online. So I'm really curious to see innovation that comes out with food. I'm also very interested in sort of this marketplace concept that I see coming up and popping up. There's a new marketplace called [inaudible 00:41:57].

Stephanie:

Yeah. I was just reading about that this morning.

Ju:

Yeah. So it's sort of like a D to C. I guess it's a good D to C marketplace or some marketplace for D to C brands, almost like an online mall, which I think sounds really interesting as well. So I don't know. I mean, there's just a ton of stuff going on. I think for sure, like ecomm is going to be it because we've seen the adoption just really increase in penetration over the past eight months, I guess. So I'm curious to see what the innovation is going to be like, but I already see a ton of ideas happening at the moment.

Stephanie:

Yeah. Awesome. All right. Let's move over to the lightning round, brought to you by Salesforce commerce cloud. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready Ju?

Ju:

I'm ready?

Stephanie:

All right. So what's up next on your Netflix queue other than Emily and Paris, obviously?

Ju:

Oh, I'm watching the Crown, the newest season.

Stephanie:

Is it good? Someone just said that yesterday.

Ju:

Oh yeah. Because it's all about princess Diana and Prince Charles. So yes, it's good.

Stephanie:

Awesome. Where are you traveling to next when you're able to travel again?

Ju:

I really want to go to Korea actually. I want to go to Seol.

Stephanie:

Find more trends.

Ju:

Yeah. Find more trends. I want to see my relatives. I want to meet my vendors. Yeah, I would really like to go there.

Stephanie:

Fun. What do you not understand today that you wish you did?

Ju:

I wish I could understand TikTok better.

Stephanie:

Do you guys use TikTok?

Ju:

We're very heavy on TikTok. It's one of our most important social channels, but I don't know. I find it so time-intensive to make the videos and create the content and stuff, but there's some people who are amazing at it.

Stephanie:

So what kind of what are your best performing videos on TikTok?

Ju:

Oh, the peeling off the patch and that video. Yeah, because it's like kind of like a doctor Pimple Popper moment. It's kind of gross, but satisfying. And those videos will get like millions of views in like 48 hours.

Stephanie:

I had a feeling that was going to be what it was. I can advertise those videos all the time. I don't know what I clicked on at one point in my life, but I can all that advertised to me on Facebook and wherever I'm at. [inaudible] stop following me. Cool. If you were to have a podcast, what would it be about and who would your first guest be?

Ju:

Oh, that's a good question, because I actually thought about having a podcast. I would have a podcast around entrepreneurship. I don't know exactly how it would be different from other topics, but something around probably entrepreneurship, maybe how people made the first million dollars or something like that. And then my first guest would probably be Jim [inaudible 00:45:11].

Stephanie:

There you go. That's to mean you already have that connection, it sounds like a hit to me. All right. And the last one, we talked a little bit about trends or patterns you're excited about. This is a little bit different. What one thing do you think is going to have the biggest impact on ecommerce within the next year?

Ju:

Well, I mean, I guess the pandemic has already had its impact. In the next year... I don't know. I mean I think probably this big sustainability push is... I don't know if it will be in the next year, but I think we will start to see it impacting ecommerce in a significant way, in packaging in your carbon footprint. And I think we're going to see a lot more of it in the next year for sure.

Stephanie:

All right Ju, this has been a really fun interview. I love talking about how you launched on Amazon and how to get into retail. I feel like there's a lot to learn. Where can people find out more about you and your cosmetics?

Ju:

You can find more about Hero cosmetics either on Instagram. The handle is Hero cosmetics website, herocosmetics.com. And then for me, you can find me on Twitter. It's just my first name, last name, J-U-R-H-Y-U, and then same handle on Instagram.

Stephanie:

Awesome. Thanks so much for joining.

Purpose-Built, Athlete-Driven: How POC Creates Unique Content that Connects To Its Long-Term Mission

info@mission.org (Mission) — Thu, 10 Dec 2020 08:00:00 +0000

From the baseball field, to the Nascar track, to the tennis court, in sports, ads can be found everywhere. Brands and sports have been linked together through sponsorship for decades. And now, with the rise of social media and influencers, athletes can create even more profitable relationships with brands than ever before.

But a sponsorship should be more than just a way for a brand and an athlete to make money. Today, more than ever, that message matters. The story you tell makes a difference. And the purpose behind a brand is what is drawing people in and converting them to loyal customers. At POC, that belief is what has been driving the company since its founding, and it is influencing its unique content strategy, which is successfully driving people to its website and into its ecommerce channels.

POC is a Swedish company that makes top of the line protective gear for athletes around the world. David DeMartini is POC’s Global Chief Marketing and Digital Officer and on this episode of Up Next in Commerce, he explains why the purpose- and data-driven content strategy the company has devised is working, and what other brands can learn from what they have built. Whether it’s more of a focus on original, serialized video, or a different approach to working with influencers, POC’s marketing strategies have far outperformed traditional methods. Learn how and why on today’s episode!

Main Takeaways:

Propose a Purpose: More than ever, consumers are driven to brands that have a clearly-stated purpose or mission. But simply having a purpose written out on your website is not enough. Brands that develop an ambitious purpose, stress test it, and look beyond the problems of now to understand how their purpose can drive them in the future are the ones that will succeed.
Don’t Be Old School: Athlete sponsorships are not new in the marketing world, however, brands like POC are finding creative ways to expand those partnerships. By investing in different marketing channels like video series, movies, and other long-form, engaging content, brands can set themselves apart and tell stories in ways customers will connect with.
More Than The Data: Every organization should be using data to guide organizational decisions, but data should never be the only factor. Data should be used in conjunction with what you know about your customers on an intangible level to create a balance that is analytics-based but still feels human.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Hello, and welcome back to up next in ecommerce. This is your host, Stephanie Postles, co-founder of mission.org. Our guest today is David DeMartini, the Chief Marketing Officer at POC. David, welcome to the show.

David:

Hi, Stephanie. Thank you for having me. I'm excited to be here.

Stephanie:

Yeah, I'm really excited to have you too. I just went into a Wormhole watching some of your guys' videos with the skiers, flying down the mountain at lightning speed and I was like, "Could I do this? No, probably not." But they were great to watch.

David:

Yes. Oh, well, thank you. And I sure you could do it. We have an amazing roster of athletes that do a great job of telling our brand story through their actions and our goal is to do everything we can to keep them safe. So, it's fun to create content or let them create content and it helps us tell our story.

Stephanie:

Yeah. I love that. We'll definitely be diving into all of that in a little bit, but first tell me or anyone who's listening, what is POC?

David:

Yeah. So POC is a Swedish company that was founded in 2006, 2007 timeframe. We are a protection brand. We're the world's leading protection brand, currently servicing athletes and participants across bicycle sports and snow sports. And so, we have a really strong mission and purpose to save lives and protect those pursuing their passion, and enable people to really find more joy in life through using our products to keep them as safe as possible when they're doing the things that they love.

Stephanie:

Yeah. And you have very nice looking products as well. I haven't been snowboarding in a while, but I'm like, "If I was, I would want this helmet here and they even have mouth guards nowadays, which is mind blowing to me." I mean, very helpful, but I have not seen any other companies. You have a helmet with a... Is it called a mouth guard? What is the word for that now?

David:

Yeah. Well, on the snow side, we have a couple of different disciplines that we service. And I think the product you're referencing is one of the helmets we have on the race side of our business. When slalom skiers or even some GS skiers are running gates. There's a chin bar that attaches to the helmets to make sure none of [crosstalk] end up smacking them in the face as they're making their way down the course. So, always looking for ways to better protect our athletes in our customers. And that's a pretty handy service with that chin bar because taking a slalom gate to the face is not much fun.

Stephanie:

Yeah. It does not sound like it. I also looked at them like this would be perfect for my two and a half year old, and he is always falling and hitting his face somehow, or his chin I'm like, "You guys need some kids versions of this."

David:

Yeah. That's a good point. We have an amazing children's line that we call poquito-

Stephanie:

Oh, cute.

David:

Kids helmets and there's some really cool safety pieces built into that. We found that the most accidents that happened with kids on a ski slope or on a bicycle are scenarios where someone larger than them, whether it's a larger kid or an adult just simply doesn't see them. And there's a collision that happens. So we have a really great visibility story built into our kids' products, but we hadn't thought about the chin or face protection for the children, but maybe we [crosstalk 00:03:28]. Yeah?

Stephanie:

Yeah. So when I was looking through your LinkedIn [inaudible 00:03:33], I also saw that you have a background in media and sports, and I was wondering what drew you over to POC?

David:

Yeah, so I of cut my teeth at an agency in Colorado working across an amazing book of brands that the agency Backbone Media service at the time. And it was really an amazing opportunity for me because I got to really dig in and understand some of the challenges that brands have really all maturity level, where we're trying to overcome. Everything from a larger, more established brand, like Eddie Bauer or YETI Coolers, all the way up to startups looking at how do they just continue to raise some money to propel their business

David:

And so, as I was working through and learning and absorbing and working with all these amazing people at Backbone Media, I was really fine-tuning the things that were interesting to me and knew I always wanted to be in marketing and direct-to-consumer but really found an understanding of what specifically in those areas were interesting.

David:

And then after about five years with Backbone, POC was one of the clients of Backbone for a long time. And one of the accounts I worked on and an opportunity came up to join POC internal as the marketing director for North America and I took that and I've been lucky to find myself in some opportunistic positions within POC. And my skillset has allowed me to rise to the ranks here as well which has been really fun and really rewarding.

Stephanie:

Yeah. That's great. I also love how POC has the same messaging across all the platforms. It was very clear about what you guys stood for. So tell me a little bit about... Did that draw you in when you saw, "Here's our purpose. Here's why we're here." How did that impact your decision to jump over to work with them?

David:

Yeah. I think that one of the key attributes that you see as particularly important and something that a lot of brands in the outdoor space focus on is purpose. And the term purpose can be applied to business or the way that a company operates in a lot of different ways. But I realized early on that a trend that I was seeing with the brands that I worked with at Backbone Media, the ones with a solid foundation, a clear purpose and a really clear and ambitious but not to the point where the brand platform and the mission of the vision didn't really mean anything. Those are the companies and the brands that were doing the best.

David:

And so, I quickly realized how important that was. And so, as I thought about what was next, I knew that, that was core to any organization that I could see myself at, for an extended period of time. And so I made that one of my priorities and starting to look around for whatever was next for me was that purpose has to be there. And I have to really be able to connect to that purpose in a meaningful way because if I can't, in a lot of ways you're trying to fake it to make it, and that just gets really taxing and is tiresome and hard to do. And it comes back to, if you can act to the purpose it's very easy to find the motivation to really give everything you have to the business and these days you have to do that.

David:

So, POC has had it. It's a really amazing a brand platform and admission and vision. That's been with us since day one and credit to the founder, Stefan Ytterborn who created the brand in 2006, to address a problem that he saw in the form of... His kids were becoming ski racers. And he looked around at the head protection at the time and said, "This doesn't seem all that great and I think I can do this better." And had the foresight to realize that spending the time and really ironing out what he was there to do and what their mission and vision looked like, was crucial to make sure he built something that could continue to live on and be successful.

Stephanie:

That's great. Your kids always seem to be a driving force sometimes with businesses or new products. And I love that story, having an actual reason to develop something and being like, "Oh, everyone actually needs us in this industry. And it's not good enough. I'm going to fix it right now."

David:

Yeah. He saw a problem that was specific to him and where he was in his life and realized that, he's probably not the only one feeling this way and really created something special and it's been a fun ride since then and continues to do well. So, again, it goes back to the core purpose of the business is real and meaningful. And that's really valuable and making sure that we make the right decisions on a day-to-day basis.

Stephanie:

So, since you've been able to see many brands, especially why you were working at the agency, what are tips or best practices around maybe a new brand coming up with their purpose, but then actually following through, because I think that's a tricky thing with a lot of these new companies popping up it seems like a lot of them say they have a purpose or here's what we're doing, but it doesn't actually come through. It's just like the messaging. You don't see actions behind it. Is there any advice or things that you saw when you were at the agency of like this work and this did not work, everyone should not do it this way?

David:

Yeah. It's a good question. And I think the answer to that can take many different forms but really what you're looking for is something that's balanced in something that is, it can stand the test of time. And so what I saw at Backbone was it used to be that you could identify a problem, find a solution for it, and then take that and run with it. And I think that that worked for a long time and that was the traditional approach to starting a business. But I think the consumer today has evolved so much to where they look for more than just helping them solve a problem. You really have to be invested in the solution and in the problem itself to a point where it's authentic and real.

David:

And so I think for anybody who's thinking about starting a business and can't stress enough, the importance of making sure you spend the time and put the work in on building a brand platform and then pressure testing that through all different mock scenarios thinking about where you're going to be in five years, 10 years, 15 years, and beyond. And making sure the verbiage you use in the core of that brand platform can remain constant. I see if a new company is... It's almost like you can't be too focused on the problem you're trying to solve, you have to think beyond that problem, that future problems, and make sure that your approach and what you're creating can solve future problems as much as it can solve the problem here and now.

David:

And it's a really hard thing to do, and it takes a very specific approach and creative mind. And it's not easy to achieve. And so I feel lucky to be part of an organization where, we were able to achieve that. And the founders that started POC went through that exercise and it's cumbersome and difficult. But I think it's super important.

Stephanie:

Yeah. I completely agree. It reminds me of... I don't know if you've heard of the, Clock of the Long Now, it's a 10,000-year clock, and it's all about encouraging long-term thinking. And every time I start thinking about longer-term thinking, and where is this headed? I always think about that clock, it's my motivation.

David:

Yeah. I think that's a great connection point. And it's really hard to visualize and come up with mock scenarios as to what could happen in 10 years because who knows what's going to happen in 10 years. But I think just going through the exercises and putting the time and the effort and we'll help you find the right balance between to immediate here and now, and then on the other end of the spectrum is... I don't know if you know a guy named Scott Galloway, but he uses the term, yogababble where you use so many buzz words and it's so conceptual that it actually completely loses all of its meaning. You got to find someplace in between there that is balanced and can stand the test of time to a certain degree.

Stephanie:

Yeah. That's a good mentality. I saw you have another title, which you didn't mention in the intro, and I'm not sure why, of executive producer. I was looking at the one video, American Downhiller, which is really good. I only got to watch 10 minutes of it, but I think it's a good segue Into some of your marketing and content strategies because the video was so well done. I mean, is it on Netflix? If not, it should be. Tell me a little bit about how you guys go about thinking about developing videos.

David:

Yeah. I'm really glad you brought that up because that's a really, really fun and amazing project that we just launched to the world earlier in... I think it was in October actually. I was going to say November but, launched in October with a world premier here in Park City, Utah, and then a distribution program with U.S. Ski Team and skiracing.com. And like I mentioned, we got our start in ski racing and it's incredibly important in Colorado business. Compared to other snow sports categories, or the bike category. It's relatively small, but it's so important because in the athletes... Really on any level that are competing or skiing gates on a consistent basis.

David:

I mean, that's where the stakes are at the highest. That the speeds are incredibly high. The snow conditions are ice essentially these days. You have skis with incredibly sharp edges and the possibility of things going wrong is quite high. And so, we work really hard to continue to innovate on behalf of the ski race community and find different ways to apply the different technologies and safety features that we develop to their world. And so, through the years we've become really close to this ski race community. Like I said, it's not a huge community, but it's very tight-knit one. And one that we're very happy and proud to be part of.

David:

And over the years, looking for opportunities and being very close with the U.S. Ski Team, we saw this story that was really amazing and hadn't really been told on a mass level around the men's speed team, and how brotherhood really formed through, I guess you could say it through unique adversity in the sense that no ski racing in the U.S. is not what it is in Europe. When you go to Austria, you go to Norway, you go to Switzerland, ski racing is... I mean, the Hanukkah in Austria is it's like the Super Bowl, it's a huge deal there. They have amazing massive fan bases and so being an American and on the American team, when you're competing, most of the races are in Europe. And so the challenge is that the U.S. team had to overcome were unique.

David:

And I'm not really qualified nor want to say that their challenges were harder or worse to overcome than some of the Europeans, but they were just different. You're not able to travel home on the weekends. You're spending so much time with your other teammates and it really cultivated this brotherhood that organically evolved into this story that became... They took the name American Downhillers, and that term became a tool to represent this brotherhood and the function of some of the veteran guys on the team working to help develop and help some of the younger guys that were coming up to the speed program navigate some of these difficult scenarios that they were in, where you're in foreign country, you're not able to see your family. You're not able to go home on a consistent basis.

David:

And really that story was just so amazing that we were working with skiracing.com, and we finally said, "Hey, let's try and tell the story." And so, it came to life and I believe it was 2017 where we started to do some short episodes in conjunction with skiracing.com. And we did that for two or three years, five minute, eight minute, 12 minute episodes, focusing in on different elements of this American Downhiller story.

David:

And towards the middle of 2019, we said to ourselves, "Well, these episodes are great but we haven't really done anything like telling the story from start to finish. Is something we haven't done and it would be an amazing piece for the ski race community." And so, we partnered with skiracing.com and a woman named Claire Brown, who's an amazing producer and has an amazing team of filmmakers. And she's been a part of the ski race community since she was a little kid and she raised competitively through college and I believe she was an All American. And as a staple in that industry and community. And so, we worked with her to tell the story. And so we were able to tell the story from start to finish and pull pieces from the different episodes that we had. And it turned into this really amazing piece that, gives some insight and some behind the scenes look into what it truly means to be an American Downhiller and then some of the challenges that they had to overcome.

David:

So a really, really fun project that Claire and Elizabeth Reeder, who's one of our Sports Marketing Managers, did an amazing job facilitating and putting together, and we're super proud of it. And we're excited we're going to continue on with this theme and this first one was focused on the men's team, and there's equally as interesting and amazing stories on the women's side. And we're excited to continue to tell these amazing stories that happen in American ski racing, and the next one up we'll be focused on the women's team.

Stephanie:

That's great. So, where does this content live? I definitely want to finish it. I mean, like I said, it seems like it should be on Netflix or something. It's very, very well done, very professional. It gets you right from the beginning with all the skiers hopping in and saying what it means to them. Where do you guys put this content after it's all made?

David:

So the distribution for it... We launched a lot of amazing new ski race product this season. And so, we had an objective to reach and engage and build our connection with the ski race community. So the initial rollout plan with this was to work with the U.S. Ski Team work with skiracing.com. and obviously we would support it as well, but we have it living on YouTube and we've seen really great results from an organic grassroots distribution plan. We are looking at some film festivals throughout the country over the next few months and have submitted it in a few of those and we are looking at some larger distribution. There's possibility that some of it might run on NBC, this winter, which would be amazing.

David:

And we're looking at the subscription viewers or platforms like Netflix and Apple TV and Amazon as well. And trying to figure out how we can get it up there. The goal with the larger distribution platforms is... Again, the story is what's most important and the story can help inspire the next generation of ski racers or particularly American Downhillers. There's a utility function to that and we want to make sure that, that's available to any and everybody that wants to see it on an ongoing basis. So there's a long tail distribution plan to this as well, to make sure that anybody who wants to learn and understand this story has the ability to do that through some of these larger platforms.

Stephanie:

That's cool. It seems like there's definitely a lot of angles. You've got the partnership thing going on. You've got... Yeah, being able to tell the story holistically, like you wanted to and then the long tail of possibly be able to sell products as well when people see them, yeah. At the perfect place, perfect time while they're watching it.

David:

Yeah. And we were very intentional about... We didn't want this to be something that felt like we were artificially trying to place product throughout it, the commitment was to the story. And like I said, we've been a partner with U.S. Ski Team for so long that now our product is visible, but you'll also see product from our competitors. And that's okay. We feel like if the story's great and we can help facilitate telling it we don't need a ton of branding. We don't need POC products sitting next to every interview or we don't need the traditional product placement in these stories, feel like we're doing a service to the community by facilitating telling it, and for us, that's what we're here for. So, we take a bit of a different approach to content than say some brands do or some brands previously have.

Stephanie:

Yeah. Well, how do you guys approach product placement? Because that seems like a very... I mean, it's always been around, but I see a lot of brands doing it way better now. I was just talking about it, the Netflix series of one about organizing and how well the container store did after that. And I don't remember really being slapped over the head with the branding, but it was more me wanting to check into it afterwards if like, "Well, what were they using to organize their entire closets?" And it was very organic. So I see brands doing a much better job now when it comes to product placement and partnerships around that. How do you guys explore that avenue?

David:

Yeah. So our sports marketing organization does an incredible job and partnering with athletes and getting our product on athletes has been core to our marketing strategy since day one. And so, again, do think it comes back to the purpose conversation we had and we are not delivering on our purpose if we are not supplying the best in the world with our products, because we truly do believe that they're the safest products out there. And so, as you mentioned it, when you take an approach of... We want personalities, we want athletes on our roster that have similar beliefs but of course their own brand and their own way of executing on those beliefs. But we want people who stand for innovation, progression, and we want to make sure that the partnerships we develop with athletes, we truly are helping them pursue their passion and helping them progress the sport that they've dedicated their lives to.

David:

And so, we have an amazing list of a roster of athletes that we're always looking at and adding to. We have some amazing development programs as part of our sports marketing strategy. We have a three layer level approach. We just launched a revised regional or grassroots athlete program that we call the Aspired Collective and that is solely intended to give up incoming athletes across both snow sports and the bike world. Give them opportunities and help them continue to progress in their careers to one day be the next superstar. And so, doing what we can to support the communities and support the activities in sports that we service through supporting talent within those categories you naturally find yourself with your product on the right people more often than not.

David:

And so, again, it's a little bit... We try and take a maybe a less manufactured approach and we don't go out and say next year we think so-and-so is going to be the best ski racer. So we've got to get our stuff on this person, this guy or girl, and then the next year it's someone else. And so we go after, we look for longer-term partnership opportunities people who truly believe in what they're doing and partnering with us helps them do what they're doing better. That's the stuff we look for.

Stephanie:

Yeah. It seems like athletes sponsorships, that's like the original [OG] influencers. Influencers are big now, but the sponsorships of athletes, it seems like it was already going on for a really long time. But what seems really hard to do is figure out how it's driving sales or how it's influencing your marketing campaign. How do you guys think about that when you're setting up these partnerships, you're picking out what athletes you want to work with? How do you think about what the end results should be outside of just wanting to work with a great person of course and making it long-term? What are some metrics you hope to achieve with these parties?

David:

Yeah. I think it's a really good question because I think the rise of influencer marketing has put such an emphasis on follower number and engagement metrics and all these things. And I think what we've seen is that those things are all important and I'll get into how we look at those, but you can't focus so much on just the numbers to where you lose sight of the individual, the personality, really the non-tangible that an influencer or an athlete or any partnership brings to the brand. And we've been very careful to... We have an objective to be results driven and measure what we can and take a data-driven approach of course but we also want to make sure we don't over index on that to the point where we lose some of the intangible stuff.

David:

So, when we look at an athlete, a lot of times their Instagram follower account or their YouTube page is an important metric and in the equation but they're also three or four other metrics that are equally as important. So we look at personality, we look at opportunity to have a longer-term relationship with this person. We look at how they compete, where they compete, these sorts of things and make a very balanced call on whether or not they should be somebody we should pursue or not pursue. But to answer your question about measuring influence that athletes or influencers have, it is difficult. And there are some data tools that we have, whether it's being smart about how you distribute content for them to work into their communication outreach with specific links and stuff that we can track through our website.

David:

But a lot of that stuff is specific to a single campaign or a single program and there's really not a great way going back to the equation that we look at, there's not a great way to measure the intangible stuff, but we know it's important and we know it's working and it's a core element of our positioning in the marketplace. And so, we measure what we can, but we also try and be real and be okay with... There's simply some things that are just hard and difficult to measure and we trust ourselves to say, "This is this things that aren't measurable, we can..." I trust our people and we trust ourselves to say, "This is worth the investment and it's providing a lift to our brand in a way that we just simply can't measure."

Stephanie:

Yes. What are some of your favorite marketing campaigns that you've done that you really remember, or that were most successful?

David:

Oh, that's a good question. Favorite marketing. The American Downhiller is definitely up there just because it was so different and new, and we'd never produced a feature like them but we've already talked about that one. Earlier this fall, we launched a signature series, excuse me, around Fabio Wibmer who's an incredibly talented mountain biker, whether it's trials or downhill riding or, dirt jump riding. He is arguably the most popular mountain biker in the world right now and we created a signature series with him that we launched earlier this fall. That's really, really cool and we took the approach of, "We're going to create the product for you, but we really want you to create the marketing and the messaging and launch this product in your voice."

David:

And that was a really fun approach to take to this because one, it took a little bit of the stress off us internally, and two, it allowed for our audience to hear a message that they're used to hearing from us, from somebody different, which I think in a lot of ways was quite refreshing and something different. And Fabio's team is incredible at creating highly engaging video content and his YouTube following is massive. And so, we basically said, "We'll help you make the product. We'll support some of the distribution of the content, but we want you to create that content." And so it was a different approach for us and a pretty fun one because it brought a different tone of voice to a launch than we're used to having.

Stephanie:

That's really fun. I mean, and a really good point because I can think of so many brands who work with people in their industry and they end up squishing their creativity by saying like, "This is our brand messaging. This is how it needs to be done." And you can tell you're like, "This is not Oprah Winfrey talking. This is not that Oprah does that." I don't know, but they squish the creativity of the artist or the influencer by all their rules. And it ends up not being very organic and then no one's following actually ended up connecting with it.

David:

Exactly. And the value that these athletes and influencers and anybody that we partner with bring to our brand is they have their own community and we want to help them build their own community. But if we come in and say, "You need to talk to the community that you've built in our voice and in the way that we speak and over-engineer that, one, their community is going to say, "This is stupid. I can tell this isn't new, or I can tell that this isn't the person that I committed to either through a click on follow or some other way." And if we give that freedom to the person to communicate the points that we're trying to get our audience to understand, and in the way that feels natural to them it's going to come off better, it's going to be a better end product in terms of the creative and again, it's going to resonate with the audience more effectively.

David:

And we lean on our athletes in our roster of partners very heavily because they're good at what they do. And for us to come in and say, "We know how to do what you do better," it doesn't feel right and I don't think it's right.

Stephanie:

Yes. So you had a good quote that I saw, but I'm probably going to botch it. So you can just tell me if it's wrong. It's all around data and you were saying that the data that you gather around your customers is your true North. And I wanted to hear a little bit about, what data do you look at and is that influencing your products, or how are you using it day-to-day?

David:

Yeah. I think that you got the quote exactly right so, thank you for that. And I guess maybe a little counterintuitive to my last point of the balance between tangibles and intangibles, but when we do have data available, we need to make sure we're using that. And we are still a growing organization and we are far from totally dialed in terms of our data management and pulling and curating as much data as we possibly can. But we have gotten a lot better at doing that, really the past three or four years. And part of being able to actually use your data effectively you have to start with your systems and your tech stack and we've been really lucky to be able to partner and use Salesforce suite of services with Commerce Cloud, Marketing Cloud, and Service Cloud.

David:

And the decision to run with those platforms was specifically so that we could start to organize our data and get our systems to speak better together and learn more about our customers. We have all kinds of different touch points with these customers. And the fact that Salesforce Commerce Cloud can speak with Marketing Cloud, and even with Service Cloud when we get a customer service inquiry that scenario really at least gives us an opportunity to maximize what we know about our customers. And so, like I said, we have a long way to go to be where I would say we're A+ rating in terms of data management,` but every day our team gets smarter and we make right the right decisions and we learn more.

David:

And I think in terms of using the data as your true north and bringing it full circle back to the idea of balance, you got to be able to analyze the data, understand what the data is telling you, but then put that information or that insight into the context of the other things you know about your customer base. I think one of the things I feel very lucky in that, we are a relatively small team, a marketing team of 25 or 28 people across both the marketing team and the digital team. One of the benefits of that is that, we don't have a lot of redundancy and every individual in the organization you naturally have to gain an understanding and you got to know our customer relatively well for almost everything that we do.

David:

And so, that contextual understanding and knowledge of our customer, coupled with some better data management and insight going actually does give us a pretty good understanding of our customer. What's important to them and how we can deliver on that. Whereas I think a lot of times in bigger organizations I've seen, if you have a lot of not necessarily redundancy, but a lot of very specified positions that do one thing and do one thing very, very well, it's a lot harder to understand the big picture and gain of an accurate profile of the contextual things that go along with your customers. And so, I guess what I'm saying is in a larger organization, it's very easy to look at the data and only the data and it's sometimes hard to bring your head up and look around and say, "Okay. Well, this is what this is telling me about this specific point or insight. How does that connect with what might be happening over here?" And so there's of course the challenges with being a smaller group but I there's also a lot of benefits and that's definitely one of them.

Stephanie:

Yeah. I completely agree. I mean, thinking about how do you get to that holistic approach where... I mean, I've been at larger companies before and things get siloed and you have your customer service team over here, and they're probably hearing so many good nuggets from customers about new product features they want, or something that might help the experience better or the unboxing experience. And a lot of times that they just get stuck there and you don't know how to incorporate into your new product launches and stuff. And so, I hear a lot of companies, especially smaller ones that are very quickly growing, experiencing issues like that, where things are all siloed and they don't know how to look at the data, but then also take a step back and use your gut and be like, "That's actually sending us in the wrong direction, or that's not really our customer who's saying that."

David:

Exactly. Yeah. Being a small group allows us to... Our customer service manager can easily stand up and walk across the room or these days, tap our Digital Director on the shoulder and say, "Hey, three of my team members said this and they're hearing this. What does that mean for what you do?" Those conversations are really, really important. And since we're lucky. It's a little easier for us to facilitate those just because we're a smaller team.

Stephanie:

Yes. So what digital trends are you excited about? Where are you guys headed over the next three years in the world of ecommerce?

David:

It's a good question but there's lots of them. I think one of the things that I'm seeing in and we're actually acting on is that, consumers are... Their expectations have evolved to a certain point to where the traditional tactics in terms of driving a sale, there's more options there. I think, you're seeing a lot of brands think about the needs of their customers and really looking at it and saying, we need to be able to add more value than we're looking to extract from our customer base. And to do that, you have to really think about what are the challenges or the struggles, or the other complimentary problems you can solve for your customers on behalf of them to help strengthen that connection they have with your brand.

David:

And I think what we're going to see is that, we're going to see a lot less mass trends, I guess, in a sense or mass tactics in the sense that brands that are going to be successful are the ones that are going to focus on building a community that is tight-knit has a very meaningful value prop for the members of that community. And ultimately places a little bit more emphasis on lifetime value and holding onto the customers that they have and building a better relationship with them versus turn and burn customer acquisition bring them in, make a sale, move on to the next.

David:

And so, we're really excited about that because we have a lot of the ingredients necessary to build a meaningful community and we have to do some ideation on this idea of providing more value than we're looking to extract, but it's a new set of challenges and one that I think is a little bit more fun because you're becoming a better partner to your community and keeping hold of that and looking for ways to solve other problems for them and make your brand more appealing and one that they want to connect with on a deeper level. And that's really fun, and so we're excited about that.

Stephanie:

Yeah. That gets back to the whole idea of long-term thinking. And yeah, I think the companies that'll rise above the rest, especially with so many coming out right now, we're going to be the ones who think longer-term like that. Think how to build that community and really engage your customers. That's not just driven on that quick conversion.

David:

Exactly. Yeah. And if you look at the mega brands out there right now that are being successful, they're looking at that exact equation, obviously in a different way than we are, but you see brands like Peloton and Lululemon's acquisition of Mirror, they're looking to check a series of boxes, whether it's vertically integrating owning the hardware, developing a reoccurring revenue model. All these things that compliment and go hand in hand with a tight-knit community of consumers that are truly committed to you as a brand.

David:

Yeah. I think literally Lululemon's one of the most amazing examples because they do such a good job of developing a community, creating these ambassador programs towards, there's one up here on main street, you walk into a store and you look around and the imagery they use our local ambassadors. You look up on the wall and you see your friends up there and it's like, "Wow, one, I didn't know they were in a massive, that's cool." But also to be that smart to actually integrate local ambassadors into their communication and retail is just such a cool thing and makes the brand feel truly invested in this area [inaudible] do that-

Stephanie:

Yeah. I didn't know they did that. That's really cool.

David:

Yeah. And so they're all in on the community thing, and I think this acquisition they made of this mirror product is a great way to continue to facilitate that at scale. And it'll be really cool, not really case study, but brand to follow over the next couple of years and see how they continue to evolve because they truly are the best in the biz.

Stephanie:

Yes. I agree. All right. Well, let's shift over to the lightning round, brought to you by Salesforce Commerce Cloud. This is where I'm going to ask a question and you have a minute or less to answer. Are you ready to go, David. All right.

David:

All right. [inaudible] this might be tough.

Stephanie:

I've done a done, I'll have to cut you off.

David:

Yeah. Cut me off. Don't be shy.

Stephanie:

All right. What's up next on your Netflix queue?

David:

Oh, Netflix queue. I don't know the name of it, but there's a film series about the Formula One circuit that has been recommended to me and I wish I could remember the name, but it follows some of the drivers Formula One and it's supposed to be really, really good. So-

Stephanie:

Drive to Survive.

David:

That might be it. I think you're right. It saved in our account, which is very helpful. Thank you Netflix. That's the one where we're super psyched to see next.

Stephanie:

Right. That sounds cool. Yeah. I think someone on our team actually recommended that as well. And I think they told me to watch it from a business perspective. I'm not really sure why. I need to check it out.

David:

Wow. Well, you have to let me know what you think.

Stephanie:

Yes. What's up next on your travel destinations when we can get out into the world and travel again?

David:

Man, that sounds so nice. Doesn't it?

Stephanie:

I know. That's why I asked it.

David:

Yeah. My wife and I have been talking about... And we originally were going to do it for a honeymoon, but things didn't work out the way we want it to at that trip, but we still have not skied in Japan. And that is on our list for when things settle down, is to go and Japan such an amazing place and it's such a great culture that we're super excited to experience that a little more in depth than my business trips have allowed. And you would also get an incredible amount of snow. So this seems quite good as well.

Stephanie:

Yeah. Well, that sounds really nice. And then you can go and hang out in the hot bath with this monkeys. Have you seen that?

David:

I have seen that. I think my wife might be more excited for that than she is the actual skiing.

Stephanie:

Oh, I'll go with her then.

David:

Yeah.

Stephanie:

I went to Japan and I missed that because we weren't in the right area and that's very sad. I'm like, "How fun would it be to take a bath monkeys?" I don't know. Maybe it's a tourist trap, but either way I want to try it.

David:

Yeah. It sounds pretty entertaining.

Stephanie:

Yeah. What one thing do you not understand today that you wish you did?

David:

Oh, man. I mean, so much. It's a good question. Well, here now, I'm getting ready to take the next level of avalanche certification and understanding how avalanches work so that we can ski and travel through the back country safely. I have some training on that, but there's a lot more that I don't understand. And so that is fresh on my mind as the snow is starting to fall and I'm excited to continue my education on understanding snow pops and risk assessment and making sure that we can [inaudible] snow, but do it safely.

Stephanie:

I mean, that's a good one. And that is a unique answer. No one else has said that so far. So David-

David:

Thank you.

Stephanie:

All right. And then the last one, what one thing will have the biggest impact on ecommerce in the next year?

David:

I mean, the thing that comes to mind feels a little bit like a cop out just because it's been so talked about, but I think 5G is really hard to ignore and when that fully rolls out the mobile trends that we're seeing are going to become even more important and pointed. So, it's going to put so much more emphasis on the computer you carry in your pocket rather than the one that you sit in front of it at the desk. We and a lot of other brands are still working on how do you crack that device in a way as meaningful as it could be in maximizing the value to the business that comes from a mobile device. So, I think that's going to continue to become more and more important and it's a tough one to solve.

Stephanie:

That's a good answer. Or it's not a cop out because no one else has said that so far. I thought you were going to say COVID-

David:

Oh, right.

Stephanie:

And then I was going to be like, "No. [inaudible 00:51:09]." So-

David:

No. I didn't think of that. It's the new normal, I guess.

Stephanie:

I'm glad. Yeah. Exactly. All right, David. Well, thank you so much for coming on the show. Where can people find out more about you and POC?

David:

Yeah. So, come find out more about us at pocsports.com. Can learn more about our product offering, our amazing roster of athletes and the things that are important to us and want to moment just to thank the amazing team of people, not just with marketing but everybody here involved with POC. Like I mentioned, they are as committed as anyone can be to why we exist and that permeates through our business and so many different ways on a consistent basis. And the people here and the talent that they bring and the drive and passion that they bring truly is what makes us an amazing organization. So, would rather say, thank you to them I guess than promote myself, if that option is okay.

Stephanie:

That option is okay. That sounds great. Thanks so much, David. Yeah. It's been great.

David:

Yeah. I appreciate it, Stephanie. And great to speak with you.

Put a Ring On It: How Ring Brought Home Security into the Ecommerce World

info@mission.org (Mission) — Tue, 8 Dec 2020 08:00:00 +0000

The ecommerce industry has historically been dominated by some familiar verticals: apparel, footwear, home goods. In 2020, the world of ecommerce exploded to include a few more at the top of the list, including grocery and fitness. One industry, though, hasn’t necessarily emerged as a leader in the ecommerce zeitgeist: home security. But just because you don’t always think about an industry as a part of ecommerce doesn’t mean that it isn’t making waves among its digital peers.

The perfect example of this is Ring. Ring was founded in 2013 as a company called Doorbot, which failed to get the investment of any Shark Tank sharks, yet persevered to become a leader in home security before being acquired by Amazon in 2018. Today, Ring is valued at more than one billion dollars and, through its website sales, is bringing home security to customers everywhere.

Robin Choe is the Head of Ecommerce at Ring, and on this episode of Up Next in Commerce, he explains how Ring has built a successful business through creating a community of neighbors and what it means to be driven by a shared goal. Plus, Robin touches on his past experience working in ecommerce overseas and what the differences are between the Asian market and what’s happening stateside. Robin also details why he believes that companies that are able to foster a sense of community and safety are the ones that will rise above the fray in the business world.

Main Takeaways:

United Nations: China has been ahead of the curve in its ability to build a digital landscape that permeates throughout its society. The country is more adept at creating social connections via technology, building direct, dynamic marketplace models, and optimizing the supply chain. But other countries, including the U.S. are starting to close the gap and create more widespread access to those same experiences.
If You Stand for Nothing, What Will You Fall For?: Leadership is critical in any organization, but it is even more important in one like Ring, which was acquired by Amazon, one of the biggest companies on the planet. Creating specific team-by-team missions that all ladder up to the top of the organization and then also falls in line with your parent company is a difficult task, but a necessary one if you want to have long-term success and buy-in from all parts of the company. Having those shared missions also sets up the possibility of setting measurable goals and a true north to strive for and build toward.
Avoiding the Upsell: Customers don’t want to be sold to, they want to be offered solutions to real problems. Rather than trying to push products on people, a better approach would be to understand each customer’s specific use case and deliver personalized solutions to meet those needs. That technique is much more likely to lead to a sale than simply shoving the newest and coolest products at potential customers.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Everyone, this is the Up Next In Commerce Podcast. I'm your host, Stephanie Postles, Co-Founder at Mission.org. Today, we're chatting with Robin Choe, the Head of Ecommerce at Ring. Robin, thanks for joining us.

Robin:

Thanks for having me.

Stephanie:

So, I was looking through your background a bit. I wanted to start there, because I saw that you had worked previously at Mattel for a while. I think it's a good starting point. Then we go through your background in the world of ecommerce before coming back to Ring.

Robin:

Sure. Yeah, so I started in Mattel in 2008. My first role there was customer strategic planning, so everything around retail strategies and working closely with retailers to try and drive share of voice, market share, and ultimately, sales and brand growth at the retailers. What was unique around the starting point there was I had a hodgepodge of different channels and accounts. So, everything from Kmart, believe it or not back in the day, which is a much bigger retailer back then.

Stephanie:

Wow, bringing it back.

Robin:

Exactly. Also, working across what they call the emerging channels. Part of that emerging channel group, everything from grocery and department stores, drug channel, tried to grow our leadership share there. But Amazon was the one that really stood out to me back then, because it was still evolving, it was still smaller, but it was one that was growing substantially year over year and starting to catch the attention of our leadership and obviously something that I was preaching about internally to make sure that we're aligning and prepping ourselves to grow with them.

Robin:

From there, for about five years in the US, I moved to Hong Kong. I became the Head of Shopper Marketing or Customer Marketing for the Asia Pacific region. So, did that for about two years, and was also playing a hybrid role where I was the ecommerce excellence, best practice lead for the region, working closely with our regional accounts, our specific local accounts that are a lot bigger today like the Tmalls of the world, Lazadas, which are growing and ultimately trying to drive greater ecommerce best practices across the region.

Robin:

From there, I pivoted to a general manager role. So, I've had an unconventional career, where I was asked to take on the Country Manager role for Korea. So, everything from leadership across all the various functions, supply chain, finance, accounting to marketing and sales. And then my role expanded from Korea to North Asia. So, I had Japan, Korea, Hong Kong and Taiwan, which are all the best food markets, still residing in Korea. My role expanded to the North Asia cluster, again, driving all the sales and marketing commercial activities and leadership there.

Robin:

And then in 2018, decided to come back after being five years in Asia, and take on the role of Head of ecommerce for Mattel, which was quite unique. It was a newly formed role, where they consolidated a lot of different functions under one leader. Four different pillars that I would say we focused on, the first one was our direct-to-consumer site. So, think about Hot Wheels collector and Barbiecollector.com and trying to drive our sales and our engagement with them. Also, all websites across the world was under the first pillar. The second pillar was CRM acquisition, analytics and design to everything regarding fueling the acquisition efforts, engagement, and also the experiences on our sites. Also, even our retailer sites, believe it or not.

Robin:

Third one was digital operation. So, this is a team that really was sourcing the best-in-class assets and copy, everything that really fuels a great merchandising experience on our own sites, but also on our third-party retailer sites. So, we are basically managing all the PDPs, the brand stores for our bigger retailers like Amazon and Target and Walmart, and syndicating and deploying assets there. And then the last pillar was around digital customer marketing and digital shopper marketing, where we have a team that was specifically focused on growing our share of voice, our leadership share with Amazon.com, Target.com or Walmart.com.

Robin:

So, we had this full end-to-end scope of responsibilities where they were all connected. They were all in need of similar assets and strategies. Obviously, there was nuances between what we were doing internally and externally. But overall, it was a challenging experience but a great one, because it was broad, but also, we could see how things were lifting each other up as we're going through the process.

Robin:

And then about a year ago, made the move to Ring. Really the objective behind that was to go deeper into this ecommerce in general. I think I had a pretty broad role at Mattel. Even in my previous experience, I worked a lot with digital retailers. But being able to just dive into a brand that I love and that I was able to use as well before I even came to the company, just the mission around the brand of making neighborhoods safer, it was just one where everything just made sense for me to go in.

Robin:

It's pretty clear, and I made this clear with my boss back then. I'm not the most technical savvy guy. I'm not the guy that's going to be doing your coding and development. But I'm a guy that can come in and really drive some vision and strategy in terms of, "What are our immediate needs? How do we serve them? At the same time, how do we identify a vision for the mid- to long-term, so that we can be ready and planful and execute against what we believe to be the evolving changes that will happen and we can embrace them and ultimately deliver upon them in terms of customer expectations?" So, it's been quite a ride. Happy that I'm still here and that things are relatively going well.

Stephanie:

That's awesome. Yeah. So, I have Ring cameras around my house. Specifically, the one I love is the front camera with the floodlight on it, because it would blast people if they walk by and I think they're a little bit shady. But yeah, I really like Ring. It seems like a very different transition, going from Mattel to Ring, especially when you were for a little bit there focused in Asia, which in a lot of ways, I think Asia is actually very ahead when it comes to ecommerce and social stuff and community building. Were there any best practices that you learned throughout that journey that you're maybe bringing to Ring now?

Robin:

Sure, I think there is a ton to learn. Like you said, you had a variety of different business models out in Asia. For example, you had the direct model, which was unique. It wasn't normal like it is here in the US with Amazon, for example. But it's one where it's more of a marketplace model, where you're basically the manufacturer that's selling on a respective third-party platform. So, whether it's Timo, whether it's sites in Rakuten, in Japan or even in Korea, where you have coupon, you have such a dynamic and a different approach as it relates to how to connect with a customer.

Robin:

So, I would say some of the things that I was able to carry over here is you're right, it's very digitally connected in most of Asia. They are well advanced in terms of just being able to stay connected from a digital platform perspective, but also connecting with consumers in unique ways. So, I feel like maybe what they've done in terms of social commerce, for example, or being able to find ways to navigate supply chain challenges or complexities, they've done a great job to accelerate that. I think they've been ahead of the curve in terms of the US for probably another... They're probably ahead by one or two years, but I think the US has been catching up.

Robin:

So, I would say best practices, back to your question, it's basically how do you connect with the consumer in a way that is relevant for what they're looking for? For example, PDP pages in Asia are very long and extensive, meaning you could scroll for miles. That's what they're expecting there, because they want to make sure that they know what they're buying, that it's quality, that it's a trusted brand.

Robin:

Here in the US, it's not as long, obviously. You do have some scrolls to get to the bottom of the page, but you're not looking for as much. Maybe ratings and reviews are more important here in the US. It's also important there, but they're also featuring, "Is this the best seller? What's the ranking on the skew versus the category?" So, that's a good question. I think, for me, it's connecting with communities and also just best practices in terms of merchandising and how they do it differently and how we can take some of those and deploy that here in the US.

Stephanie:

Yes, yeah, I love that. I always think it's something good to watch, because I mean, they are much more mobile first. Whereas a lot of people here-

Robin:

Sure.

Stephanie:

... grew up on desktop. All those people actually just leapfrogged past desktop and have just been used to doing everything on mobile. I know especially around the podcasting space, it's an area that we also keep an eye on, because they have so many social functions that they're just used to. That I'm like, "Why don't we have that here?" So, it's always good to keep an eye on what other markets are doing.

Robin:

For sure.

Stephanie:

So, let's get back to Ring a little bit. So, Ring's owned by Amazon now, right?

Robin:

That's correct.

Stephanie:

So, I think that would be really good to talk about how that relationship is working, specifically around earlier you mentioned leadership. I want to touch on what that transition looked like from Ring being its own separate company to then being acquired. I'm sure you had new teams that you're working with. You had to really distill your mission and the shared values and everything that you had, the influence with the new team or company in general. So, I want to hear a little bit about how you led that or how you're leading it now.

Robin:

Sure, yeah. I think the beauty of Amazon and Ring is you're taking the strengths of each company and you're marrying them together. I've worked for big companies like Mattel. I've also worked for small companies and startups as well. So, I love the mash up between the two where you're able to be entrepreneurial. You're able to really be nimble and agile in this small setting of what Ring actually started off as, as a startup.

Robin:

And then taking the successes of a startup and then marrying that up with this successful company, Amazon, the biggest ecommerce company, at least in the US. In the world, I would say at least a leader. It's one where you're able to leverage the infrastructure, the resources, the mechanisms and the processes that they've been able to deploy, and they've been so successful with. So, that's something that I find to be very interesting.

Robin:

I think with Ring, we still are led by our founder today. He's our CEO and our Chief Inventor. It's one where he does drive a lot of vision and strategy in terms of not only the mission of establishing that, but also everything around products and services. That continues to grow as we speak. In terms of team and leadership, I apply the same model that I do in every circumstance that I've been in. It's like I spoke on earlier, I've moved to three countries in a matter of five years. That's not easy with-

Stephanie:

That's crazy.

Robin:

... a family of kids. Being able to embrace change and being able to pivot and establish yourself amongst different cultures and teams and environments and business models is quite hard, even with language barriers as well. So, I think coming into Ring, I applied a similar approach in terms of leadership. It's one where we have to pause as a team, because the team could be in any sort of condition in terms of their history. Whether they were without a leader in the past or they have gone through significant changes where they we're acquired, whatever the case may be, what I typically do is I come in. I spent some time, just parking time with the team and our leadership to say, "Hey, look, how do we get focused on what matters most?"

Robin:

The first thing I want to do is, "Let's establish a shared mission. Why do we exist? What's our purpose? Why are we here? Why do we get up every morning?" As an ecommerce Team at Ring, it's something that is really critical, because we're moving so fast. There's constant updates and changes and features and functions and migrations and transitions and new product launches, you name it. It's one where we got to slow down and establish, "Why are we here? Why do we exist?" I think that's even more important today, especially as we're navigating this pandemic.

Robin:

The second thing I also do is look at, "What's the shared vision look like? Where are we going? Where do we want to be three to five years from now?" Also, establishing values. So, we typically pick three values, whether it's trust, whether it's communication, whether it's collaboration. That's really what we center on. We'll spend time and it doesn't take a one-hour session. It takes multiple days and hours and dedication to really grind through and work through the rigor and discipline of saying, "Okay, this is why we exist. This is how it ladders up to Ring's mission of making neighborhoods safer. This is how it ladders up to Amazon's mission of being the Earth's most customer centric company." So that's really important.

Robin:

I think, because we did that and we do have an ecommerce Ring-specific shared mission, which is something that we identified and we have not just put on a wall, but it's really something that needs to live in our hearts. But I'll share that with you. So, our ecommerce group at Ring exists to communicate to our current and future neighbors, how we provide products and services that protect what is important to them. We do this by building strong relationships with our partners to deliver the best digital experiences for our neighbors. We call our neighbors, our customers, because it's just that important. So, that's really something that I do.

Robin:

I think what's been great is not only is it the shared mission and vision and values that you build upon and that you live by and you keep each other accountable to in terms of the way we behave and operate day to day, but it also helps to step back and say, "What are our key priorities? What are those big rocks that we need to move in the mid- to long-term? What are those things that we need to do in the short term to address the business needs and the evolving changes that are happening?"

Robin:

So, I would say that it starts with the team. It starts with having an aligned and a shared... It's not just my mission. It's a shared mission and vision and values. And then being able to build on processes like mechanisms, whether it's quarterly, weekly business reviews and roadmaps, and align that across not only the internal team, but across the organization. So, that you can drive success and make sure that your communication, your execution is as consistent and aligned to all objectives, at least the key priorities, that we deliver on a day-to-day basis.

Stephanie:

Yeah, yeah, I love that. I've definitely seen and heard of quite a few experiences that are full of friction when companies are getting acquired and on both sides. So, how do you work to garner trust from the employees who are getting acquired, where some people might not really want to go to a big corporation? They might want to stay at that startup vibe. On the other side as well, what do you do to actually get them to be on your side, be ready to move forward with the mission? Because I could see some people being not really on board with it, not really caring about the vision, being like, "Oh, that's just all words." How do you get in the weeds with them to really get them on the same page?

Robin:

Yeah, back to just leadership, I think it's really important that we stay in... This is my philosophy as well. It's servant leadership. It's also compassionate leadership. So, being empathetic, right? So, there's people that have come from all backgrounds and different experiences. Whether they were at the company before they got acquired, whether they joined afterwards, even for those that we haven't even seen in person post-COVID, it's empathy. It's about caring for people. People are people at the end of the day. They're not machines. They need to be cared for. They're not human doings. They're human beings.

Robin:

So, my philosophy and approach has always been around empathy and just trying to put myself in their shoes and understanding, "What are their goals? Are they aligned to our goals? How do I listen to them in ways that can really make them feel that they're heard?" That anything that may conflict or go against the mission or the goals or values, let's talk about it. If it's something that you feel differently and you're not aligned to this, maybe you don't belong here. Maybe this is not the right place for you.

Robin:

But in general, I would say the majority of the team and I guess the team overall, they are bought into the mission. I mean, we defined it together, which makes it powerful. I think that's where you nip that bud up front. You're able to just journey with each other through the ups and downs and challenges, but ultimately, the successes as well.

Stephanie:

Awesome. So, I was looking through Ring's website before this. I didn't even realize how many products you guys had, because like I was mentioning, I only have these two. I want to hear a little bit about, "What is the customer journey look like on the Ring website? How has it evolved, especially over the past maybe six months?"

Robin:

Sure, I would say the Ring website is quite unique, where Ring is not just the doorbell. Ring is a multitude of products that have continued to expand to meet and deliver that mission. So, if you look across our products, we have not only doorbells. We have security cameras. We have alarms. We have accessories too that attach to these various devices. We also got the Smart Lighting. We have third-party partnerships. I don't know if you recently heard about the announcement that we made, but we're coming out with even new categories, whether it's Always Home Cam, which is an autonomous drone that flies across the inside of your house.

Stephanie:

Wow.

Robin:

You can basically train it to go to certain parts of your house to check on whether your stove is on or your pet food has been eaten or any other areas where you may not have a camera setup. So, I think it's again innovation and evolving to a customer need or pain point that we're trying to deliver on.

Stephanie:

Okay, I need one of those.

Robin:

Yeah.

Stephanie:

Does it stay flying or does it go back to its little nest and then like get up-

Robin:

Yeah. So, it stays in the nest. And then based on whether if it's alarm, trigger or notification, it'll basically come out of the nest. There's obviously a sound so that you can hear it. We think about privacy always and security and keeping that in mind. It'll go to specific places of your house that you trained it to. So, you have to map that out-

Stephanie:

Got it.

Robin:

... and then ultimately, come back to its nest. So, I think it's going to be-

Stephanie:

Can it go outside?

Robin:

... amazing. Right now, we're not building it to go outside. I think it's one where it's not an actual design drone to go outside, but for now, we're keeping it in the house. We're calling it Always Home Cam.

Robin:

But yeah, so new categories, even car security. So, we're starting to expand there, because we're hearing a lot of times from our neighbors as well feedback around, "I wish you guys had car security that connected with my Ring app and my overall Ring ecosystem." So, that's really exciting as well. Whether it's your Tesla or card dash cam to even just the 99% of cars that are out there, just being able to have a peace of mind around bumps or doors opening are areas where you're not feeling as safe. So, that's another cool category we're entering into.

Robin:

Also, my favorite, which maybe is not everybody's favorite, but I love it, is like our mailbox sensor. So, imagine when you open your mailbox, you get a notification. That's also could be connected to your devices, whether your camera turns on in a specific area where your mailbox may be or your Alexa Echo Show 5 also is all integrated as well. So, that turns on. You can watch it and say, "Hey, Alexa, show me my front door. Show me my mailbox," whatever the case may be. It's one where you can again see and review and just make sure that you have a total sense of peace of mind.

Robin:

I would say also, to add to that, we also have our subscription plans as well, which you can view, record, share out, and also do professional monitoring. So, I think that's a really big benefit. We've heard countless stories. I also have my own use cases as well where neighbors are feeling so thankful that they had their alarm on at home. So, that they weren't going to show up when the burglar shows up or they're able to record specific event that leads to finding somebody or something or whatever the case may be. There's countless stories that you could find and you can hear about I'm sure when you talk to your friends and neighbors that do have some of our products that just really speak to the power of the brand and products and just the services that we provide.

Robin:

And then we also have our Neighbors app, which is great as well. That also lives within the ecosystem of being able to connect with your neighbors and understanding who they are and any notifications or alerts around the community and even also partnering with those in your community, especially in a time like this. So, I love the brand. I love the products, but I also love that it lives within this ecosystem that connects us to each other and gives us a peace of mind like never before.

Stephanie:

Yeah, so that was actually a perfect point where I wanted to touch on, the neighbors piece to it, because I think it's brilliant from a UGC perspective of your neighbors are generating this content that you don't even know them. I mean, I am addicted to watching what's happening to my neighbors. Like the other day, some dude was trying to break into their storage locker, someone's bike got stolen. I sit there. I will watch the video and see if I know the person. Obviously, I never do. But it's really good from a content generation perspective.

Stephanie:

I mean, I see you guys are using some of those videos on your website, which is very fun. And then also from, like you said, a community building perspective. So, I want to hear a bit more about, "How you guys are pursuing that UGC perspective? Is it mainly just for security, or do you see a community building aspect and actually turning into a social network is how it feels to me?"

Robin:

Yeah, I think it ladders back up to our mission, making the neighborhoods safer. It's one where it plays a role there. So, whether it's like public announcements around COVID to fires in your area or different ways to have safety preparations around different use cases. Yeah. So, I think it's a combination of trying to serve solutions for specific needs or things that may come up that we want to make sure that we are prepared for and also just connecting us with our neighbors.

Robin:

As people are home more than ever, whether it's working or school from home or shopping at home, it's one where our neighbors are critical for connection and also a peace of mind and watching out for each other. So, I would say that the Neighbor app definitely is a point of connection and also sharing relevant and pertinent information that can help to make neighborhoods safer.

Stephanie:

What's the craziest video you've ever seen? I guess that'd be real crazy.

Robin:

I think the fun ones for me are around animals. When a bear comes and just starts to get on top of a car and wants to get in there to eat some food. Where I live, there are a lot of coyotes. So, I get a lot of neighborhood posts and notifications that there's a coyote roaming around early in the morning. They're all in these different pockets and areas and just make sure I'm not jogging or walking that area during that early time in the morning.

Stephanie:

That's great. I've also seen little neighborhood tips breakout on my app anyways, where neighbors will argue about whether it was real or not. I don't know if you guys have seen that. It's pretty entertaining. Like I said, it feels like a social network sometimes.

Robin:

It does. I mean, it just shows you the reality of what people have to deal with and navigate every day. I think, if anything, it's like making neighborhoods safer. That's important to everybody. I have a family. I have kids. Especially as everybody's home more, it's like, "How do we help each other? How do we make sure that we can create a community that is in support of each other and ultimately safer neighborhoods?" So, I find that to be really powerful. It's one where I'll do everything in my power and I'm sure my neighbors will to help each other out during these times.

Stephanie:

So, maybe let's touch on the subscription model a little bit. So, a lot of people right now are interested, of course, in subscriptions. Everyone is thinking about trying it if it's right for their business. Tell me how you guys are exploring it and maybe any hiccups you've experienced and things that you've pivoted or changed, anything that other people could learn from?

Robin:

Today, we have two different subscription programs.

Robin:

I think as we continue to expand in various categories, we're constantly thinking about, "How do we offer a similar experience and that peace of mind, so that you can access and even store?" So, thinking about the car category, I'm sure they're thinking through what that could look like as well there. As we expand our categories and services, subscription will definitely be top of mind as part of the services that we'll look to offer.

Stephanie:

Yup, how do you position it in a way that a customer will sign up for a subscription before something bad happens? Because I know I've experienced this, before I had Ring, I had a bunch of cameras. I didn't feel the need to store things really until one day when I was like, "Oh, I actually wish I would have access to that." So how do you position maybe the language or the sell to actually get someone to sign up for that subscription before there's a catastrophe?

Robin:

Sure, I mean, the benefit is like when you buy device and you activate it, you'll get 30 days of free, call it, subscription. That's the Basic Plan. And then you get the choice after that to opt in or opt up to a Plus Plan. So, it's one where we try and make it as user friendly and in the control of the user, ultimately, to make that decision.

Robin:

I would say also that the benefit of the Ring subscription plan is that you're not locked into some contract. So, you get to basically opt in and opt out in any time of the month. Again, we're trying to create flexibility and user control, ultimately; versus locking them into an annual account where you pay hundreds of dollars, but you're frustrated because you're not being able to use it in a way that's easy and intuitive and also beneficial for your needs.

Stephanie:

Yeah. During that trial period, the one thing that I oftentimes see happening is that a user isn't interacting with the services until they're done. And then they're like, "Oh, I never got a chance to try it." Are there certain methods that you're trying to get the user to interact and learn and figure out the platform to see the benefits of it before these 30 days are done?

Robin:

Oh, for sure. I mean, that's really the efforts around different marketing levers that we're trying to deploy to make sure that they see the benefit of turning it on and the different features available. Whether it's a nudge here or email there or different types of messaging, that we're trying to make sure that they are not only purchasing the device, but they're utilizing it in its full capacity.

Stephanie:

Yup, got it. So, for your guys' website, specifically, tell me a little bit about how you guys think about selling on there? Are you selling mostly on desktop? How are you finding customers? How are you bringing them in? What does that process look like?

Robin:

Sure, sure. So, obviously, you have direct where they're showing up. I think Ring today is a very prominent brand, or at least, top of mind brand that has awareness, especially in a category that our Founder created, the video doorbell. Obviously, there's other folks that are in this space, but I would say Ring to me would be... That's the first thing I think about is Ring when I think about home security and starting at the doorbell and being across different parts inside and outside your house, for example. But I would say yeah, it starts with the direct.

Robin:

Also, there's a lot of obviously acquisition efforts to try and be on top of mind in terms of whether it's people searching for our products to different types of campaigns to drive traffic to our site, whether they're social related, UGC, like you said. We do a lot of social care types of activities to make sure that whether it's responding to different posts or things like that will point them to solutions that are being offered on our ecommerce site.

Robin:

And then as they come to the site, we want to make it as easy and seamless. I think this is the goal of every ecommerce company. As your portfolio grows, how do you make sure that you can train... Not train, so that's probably the wrong word. It's more around, "How do you help them find what they need?" That's the easy question to ask, but a hard question to answer. So, that's one where we're constantly thinking through user research and test.

Robin:

Yeah, I think what's different today is that a lot of companies are always trying to attach this or grow a market basket. It's all about increasing EOB. Those are all important. But to me, I think what's most important is that you're not just trying to upsell, but you're really trying to deliver on a solution. So, meaning, having a camera at your front door, for example, a video doorbell at your front door, that might be good for the first three months and then you may move to a bigger house. You'll need, for example, a floodlight cam like you have. So, that you feel a greater peace of mind that surrounds your house. So, you have this whole home solution, security solution that you could leverage and apply across different parts of your home as you continue to evolve and potentially move, or you want to just expand.

Robin:

So, it's one where we're thinking about, "How do we recommend the right products for you? How do we surface the right recommendations for you? How do we help you differentiate which doorbell to buy?" Because we do have quite a number of doorbells now. What's right for you basically, based on your use case? Or even the alarm, how big is your house? We have a quiz on our Alarm page, for example, that people engage with that they want to know like, "This is my square footage. This is how many windows I have. This is how many doors I have." How do we make sure that we get them to a place where we offer up a package solution that they can feel confident about and then purchase and ultimately experience the peace of mind that they were looking for?

Stephanie:

Cool. So, to talk a little bit more on Ring before we move into general ecommerce, I want to hear how you guys are staying ahead of the competition? Because there are other security companies out there, how do you really show that you're the best?

Robin:

Yeah, I mean, I can't really speak on the competition. I would say that our priority is to constantly push ourselves to empower users with affordable, effective ways to monitor and secure their home. So, back to the making neighborhoods safer, everything ladders up to that. I think about companies that offer a product or a specific service, and it's just that one thing. They're all about to selling that product.

Robin:

I think the mental model and the approach that we have is quite different at Ring, which I love, and I totally respect. It's one where we're constantly thinking about the mission. So, everything ladders up to that mission. So, whether it's a new product, whether it's a new service, whether it's a new feature on the site, or whether it's a new experience that we want to deliver that's thinking outside the box, that we're constantly trying to think outside the box, so that we can deliver upon that mission.

Robin:

That's the way that I would frame it up for you. That's different than just looking at the competition and saying, "What are they doing?" I'm sure we can learn a lot, but it's one where we're really focused on our customers and working backwards from them and ultimately inventing and delivering effective, affordable, easy-to-use products, all in pursuit of delivering on our mission.

Stephanie:

Cool. Yeah, I'm sure you guys get a lot of customer feedback. Do you implement that as you hear what customers are looking for? Does that have an influence on maybe products or the subscription model or the app or anything?

Robin:

Yes, we do get a lot of customer feedback. I think what's unique about Ring just even in my past year is our Founder's email is on every product. It's even on our websites. He is probably one of the most customer obsessed individuals that I know. I really respect that about him. It's one where he wants to hear feedback.

Robin:

We also get feedback internally that we can share and a way for us to facilitate that and hear it, because ultimately, our goal is we want to make the customers feel safer. Whether it's buying our products, calling into our customer service line, whether it's a recommendation on, "Hey, I didn't know that this product was featured with your subscription plan. You had this rich notification that comes with it," how do we surface that up in a way that's clear and transparent on our website, so that people don't have to ask a lot of questions that they can get everything they need in one place?

Stephanie:

Yup, cool. All right. So, you've been in the world of ecommerce for a while. So, I think you should have a good answer to this. What does the future of online commerce look like to you, maybe in the next five years or so? What does that world look like?

Robin:

Yeah, that's a great question. I think the reality is, is ecommerce and digital adoption has been accelerating rapidly. I hear all the time from colleagues in the industry, "The past six months, eight months, basically, we're able to accomplish what we would have in five years." A lot of that is just based on the times-

Stephanie:

Yup, a lot of guests have said that too.

Robin:

Yeah. I agree with that. It's one where, obviously, to lead in this environment, like in any environment, we need to embrace change. But I would say overall, the ecommerce future is bright. There's capabilities that continue to just wow me. It could be simple things to complex things, whether it's complex things like personalization.

Robin:

With all the millions of customers that are coming on your site, how do you make it as frictionless and just a great experience for them to get the checkout and personalizing that experience for them based on who they are as a cohort to even simple things. I see the simple things, especially in the area of digital retailing, meaning a lot of folks aren't going to stores as much, obviously. It's one where they're constantly thinking about how to pivot and embrace the change.

Robin:

I love recently what I saw with Target and how they were able to create this Halloween activation, where they are taking select stores. They're able to convert it into a Halloween environment and pass out some goodies and basically doing it all through the comfort of your car. So, imagine, Halloween is going to look very different this year. So, they're able to provide something that is going to be a memory and a delightful experience for users. But at the same time, they're directing traffic back to the site to say, "Hey, if you can't come to this event, maybe we're not featuring in your hometown. We got everything you need from a Halloween perspective."

Robin:

So, I think it's one where you can get very innovative and capabilities are there. The times today have forced us to really think bigger and to embrace the change and to pivot and be flexible and agile. No idea is a bad idea. I think any idea is relevant, just because we're trying to figure out how to address customer pain points and needs, especially as the times have evolved.

Stephanie:

Yup. Yeah, I completely agree. It's been fun seeing the levels of creativity that have come into some of these campaigns. Like you said, people now have to think on their feet and think of new ways to do things that they've never had to before. So, it seems like there's a lot of opportunity coming out not just in marketing, but just the way of doing business in general.

Robin:

I agree. The other thing I think there is boomers and how they're obviously being forced to shop online. I had my mother call me the other day, because she doesn't shop online as much. She was like, "Can I put my name and credit card number in there and shop?" I'm like, "Of course."

Stephanie:

No, mom. No.

Robin:

Yeah, exactly. So, it's one where they're not as digitally savvy, but they're being forced to be. It's one where how do you take the traditional models today, whether it's direct mail or whether it's phone calls or just the ways that are comfortable with the past and deliver that mixed with the digital experience?

Robin:

So, I'm thinking of things like virtual consultation. For example, the doctor, the hospitals, they call you now and they do a virtual consultation before coming in. It's one where how do you bridge the gap between folks that are coming on to the side for maybe some of them the first time, but getting them comfortable in ways that can help them transition into being fully digitally capable? So, those are things I think that are exciting as well in terms of getting back to a mix of the past but also the future.

Stephanie:

Yeah, that's exactly what I was going to say is that you've got this whole new group of people who never would have been your customers, probably at least not in five years. They're here. So, now, you have to adapt to that. But then I also think what's old is new. I mean, I've had quite a few people talk about direct mail. I think they'd have done some surveys of younger individuals who say they love direct mail, because they're not used to it. It feels very personal. It's fun to get something in the mail. Maybe older generations would be like, "What? That's normal. I'm used to getting catalogs, I'm used to that stuff." But maybe bringing that back might be a way of the future. It's a more personal things than maybe everything digital all day.

Robin:

I agree. I mean, I think some folks, especially parents, are probably limiting screen time for kids these days. Maybe there's some fatigue behind that, even for the younger generation, but it's one where I think companies are being forced to really think outside the box. Direct mail may be the way to go for certain categories.

Robin:

I just think about what Amazon has been doing. I was in the toy business before. Everything was digital, whether it was a holiday toy book. When Toys R Us and even the toy industry was disrupted with Toys R Us going bankrupt, that business model being gone from the overall environment, it's one where Amazon started doing physical holiday toy books along with the digital experience. They're trying to make it as they want to have the physical touch to the toy, because kids like writing down what they want for Christmas. They want to flip through the pages. At the same time, Amazon has a PDF toy book where you click on an item, and then it takes you directly to the PDP. You can purchase and add your products there.

Robin:

So, I just love seeing how things continue to evolve over the years based on the shifting of consumer demands. Also, it's staying true to what the patterns are in terms of behaviors around people using toy books and still wanting the physical touch and also providing it digitally. So, that you can transact and get it in your household in two days or one to two days.

Stephanie:

Yup. Yeah, completely agree. All right, let's jump over to the lightning round brought to you by Salesforce Commerce Cloud. This is where I'm going to ask you a question. You have a minute or so to answer.

Robin:

Okay.

Stephanie:

Are you ready?

Robin:

I'm ready.

Stephanie:

All right, the first one, what one thing will have the biggest impact on ecommerce in the next year?

Robin:

I would say, the supply. What I mean by that is we're always going to have Christmas holiday, which is very big for respective categories. But it's one where the demand has shifted throughout the years based on people or companies being able to pivot and offer up Black Friday in October, for example, and starting early and trying to manage the flow of traffic to the stores and being cognizant of that. So, I would say supply. The second one just to add to that is contactless and touchless experiences, I think that'll disrupt the ecommerce industry.

Stephanie:

Yes, completely agree. What do you not understand today that you wish you did? It can be an ecommerce or at Ring, whatever comes to mind.

Robin:

There's a lot of things from that list. I think we're all a work in progress in terms of learning and growing. I have a ton to continue to learn and build on. So, I don't think there's one particular thing I can put my finger on, on that question.

Stephanie:

All right. What's next on your Netflix queue?

Robin:

My Netflix is controlled by my kids. So, the next one is The Octopus Teacher.

Stephanie:

Sounds intriguing.

Robin:

Yes.

Stephanie:

All right. If you were to have a podcast, what would it be about and who would your first guest be?

Robin:

I value leadership. I have mentors across different areas that I reach out to. So, to me, I love leadership, because companies are about people and not profit in my opinion. This is why I love Ring. It's one where leadership is really what helps you to emerge and helps you to navigate whether it's crazy times or great times. I think that's what holds true and keeps you grounded and successful.

Stephanie:

Cool, love that. The last one, what piece of tech are you playing around with right now that you're loving? It can be just personally, or it can be ecommerce tools that you're trying out or having success with.

Robin:

Yeah, I would say that one that I'm being forced to use nowadays is chat bots, just because of the inability to connect with the customer service agents at different companies. I mean, some of that is obviously trying to drive efficiency and automation, but it's one where it is pretty fascinating in terms of being able to try and address your question or your request, for example, into chat bots. And then having this AI, back machine powered on the back end that try and answer and address solutions.

Robin:

Sometimes it works. Sometimes it doesn't. Some people prefer just the person on the other side of the phone. But I think the chat bots and that area in terms of automation is something that I've been looking at. That's been pretty fascinating, but also at the same time, thinking through, "What would somebody really need that they want to just call the customer service line?" That's even great as well.

Stephanie:

Yeah, that's definitely an interesting area. I think I was just reading a research report that was talking about how most consumers would prefer a chatbot, if nothing. If it's no chatbot or having one, they want one, but then also make sure that you get it right where I feel like there's definitely still room to grow to make sure you can at least answer a few questions, especially if they keep coming up. And then if not, okay, go to a human or call or something. So, that is an interesting area. All right, Robin. Well, thanks for joining the show today. Where can people find out more about you and Ring?

Robin:

Yeah, so you can look me up on LinkedIn. You can go to our website, ring.com.

Stephanie:

All right. Awesome. Thanks so much, and we'll see you next time.

Robin:

Thank you.

How Discovery, Inc. Builds Audiences and Creates Personalized Shopping Experiences Across Their Many Brands like Travel Channel, HGTV, Food Network and TLC

info@mission.org (Mission) — Thu, 3 Dec 2020 08:00:00 +0000

Some brands are lucky enough to have a built-in audience of millions, while others need to develop an audience from scratch. Chris Mainenti has been on both sides of the coin and he knows that in either situation, once you have a base of potential customers paying attention to you, the next challenge is converting those browsers to buyers.

Chris is the Director of Commerce Strategy at Discovery, Inc. where he is helping turn the millions of viewers who tune into Discovery’s channels such as HGTV, TLC, Food Network and more, into customers who buy across various platforms. On this episode of Up Next in Commerce, Chris explains how he put his history of building audiences at previous companies to work at Discovery — including some tips for young companies on how to utilize newsletters. And he discusses how to use the data you collect as a starting point for creating a more personalized, one-to-one relationship with your audience on various platforms. Plus, he looks into the future to predict how shoppable experiences will be made possible with universal add-to-cart and buy-now options.

Main Takeaways:

Developing Your Audience: Audience development goes beyond marketing. When you are building your audience, you have to know who you are as a brand and understand the audience you have and want to bring in, and what they want and need. In the early days of a brand, certain audience development strategies work better than others, including tapping into the power of newsletters.
Lights, Camera, Take Action: Every company is collecting immeasurable amounts of data, which then needs to be sorted, analyzed and acted on. But the actions you take should be nuanced and applicable to the specific needs of specific audiences. For example, it would be wrong to lump together all of the women in your audience because a woman who is exploring your dot-com presence is likely looking for something different than a woman that is scanning a QR code on their TV. Those segments of women shop differently, and therefore should be approached in unique ways after the data tells you what they each want.
Dreams of a Universal Cart Experience: Many believe the future of ecommerce revolves around the development of a universal cart experience. Every business wants to create shoppable moments and engage with customers across many different platforms. But getting to this nirvana means you also have to remove all the friction points.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome back to Up Next In Commerce. This is your host, Stephanie Postles co-founder of mission.org. Our guest today is Chris Mainenti, the director of commerce strategy at Discovery Inc. Chris, welcome to the show.

Chris:

Thank you, Stephanie. I appreciate you having me on and talking all things commerce here in the current climate that we're in.

Stephanie:

Yeah. I am very excited to have you guys on. I was just thinking about how long Discovery channel, and all the other channels, HGTV, and Food Network and Travel Channel have been in my life and with that, I want to hear a little bit about your role at Discovery. I mean, it seems like there's so much going on, so many digital portfolios that you guys have over there, and I think just a lot behind the scenes that an average consumer wouldn't even know. So, I'd love to hear what you're up to at Discovery. What is your day-to-day look like?

Chris:

Sure. So, I would say, first and foremost, for commerce specifically in the digital media space, we're probably slightly different than a lot of others. We're really multifaceted in terms of how we work, and who we work with across the org. Obviously, like you said, Discovery is huge, has a ton of major, major worldwide brands. So, we actually sit on the portfolio wide level with our lifestyle brands, and we're really in the weeds with them on the day-to-day basis. And, that really starts with, obviously, our editorial teams. That's our bread and butter, that's our voice and our authority in this space. So again, that's really where we begin, and that's obviously where we're doing our content output, and producing all of this great shopping content for our different audiences, and again pulling our experts from all of these different brands to come together.

Chris:

So again, folks are really getting the full spectrum of expertise in all of these different categories. And from there, it just really starts branching out into other groups. So, we work heavily with our ad sales and branded content teams, where we work on much larger partnerships and deeper integrations which we can talk about today as well. We have a licensing team, where we work on licensed products, and we take our learnings that we're seeing on our shopping content on a day-to-day basis, and analyze that, and then speak with licensing to see where there may be some room to actually create a new line with one of our partners.

Chris:

We also, believe it or not, and I know you don't know this, we have a video games team at Discovery, and we work closely with them as well on trying to find those shoppable moments, and again bringing our brand and our voice into those games when they're being built. So again, we're always serving the reader no matter who or where they are, and again pivoting as necessary. So, those are just a few groups, and obviously our marketing and ops, and audience development teams were heavily embedded with as well when it comes to promotion.

Chris:

So again, there are just, I would say, a lot of areas that we focus on. I know in the beginning it was always all about, commerce is part of diversifying your revenue streams at a digital club. But, we see it more as now, we're trying to diversify our commerce stream into all of these other areas. So again, a lot of exciting stuff has already happened, and we're working on some cool stuff too as we head into next year. So, a lot of exciting stuff in an area that's obviously blowing up for a variety of reasons.

Stephanie:

That's a lot going on there. It's actually really interesting because you just mentioned video games, and I just did a recap episode with one of my coworkers for the first 50 episodes of this show, and the one thing I was bringing up was like, "I think there's a big opportunity in having shoppable moments in these worlds or video games." And, we were mentioning Unreal and Epic Games specifically, that I hadn't really seen that yet. So, it's interesting that you guys are starting to explore that arena, because it feels like that's something of the future, but it's needed, and that's where everything's headed.

Chris:

Yeah. And again, I can't stress enough. I mean, our portfolio is just so suited for so many of these different, avenues that we could always find something where, again, we're not being gimmicky just to say we're there. This is our bread and butter, and we're making sure that we stick to our tried and blue, into who we are, and not shy off too much, and again just try to say, "We did something here or there." Really making sure we're always serving our audiences and giving them what they want on the platforms they want.

Stephanie:

Yeah. Which I think that's a really good jumping off point, then because that was actually my one biggest question I had of how do you strategically think about what an audience wants without disrupting the content? I mean, it seems so tricky, because you see a lot of shows, and whatever it may be where you might have product placement in a show or a movie, but it might not actually uplift sales, because it wasn't done correctly. Where I was also just talking about the Netflix original, the organizing show where they partnered with the container store, and how they had an instant, I think was a 17% uplift in sales after that show aired. That worked, and many others don't. So, how do you guys think about making those shoppable moments, and actually having it work?

Chris:

Sure. First and foremost, I think, you have to be honest and say, "Look, not everything is going to hit." And honestly, it's not always meant to always hit. So, I think we go into that, first being real with the current situation, and understanding not everyone is going to want every single thing. We're always talking about integrating, promoting, so on and so forth. So, I would say that's first. Secondly, again, we start with, what's our expertise? What do we believe in? And, what do we want to showcase to our various audiences across all of these different platforms? And then, from there is when we start to really start getting down to the nuances.

Chris:

And look, we have created what we dub internally as the commerce hub, where we're bringing in data feeds from all different platforms, our affiliate networks, our in-house reporting platforms, social, so on and so forth, bringing that all together. And again, understanding, what are people consuming? And, what is their mindset when they're on social, versus linear, versus a DTC, or our dot-coms. And, really starting to look and pull out trends from that. I always like to say I prefer the term data influenced versus data driven, because you can't just take a dashboard of data, and sort in descending or ascending order, and say, "Okay. Whatever is at the top or bottom, do or don't do." And, call it a day.

Chris:

We focus much more heavily on insights, and use that data as a jumping off point, but then do very, very deep analysis, and pull actionable insights out of that for all of our different brands and teams for when they're creating new content, or when we're optimizing old content. Again, wherever that is. And then, I think lastly with that comes, how do we visualize that to the audience. On digital.com, is it more about, again, really simple to read, simple call to actions to buy items. Again, on linear, what is that? A QR code experience? Is it some type of more deeper integration with a smart TV company on our TV E experiences? Is it more deeply integrated where you can actually tap to purchase within the app? So on and so forth.

Chris:

So again, there's just a lot of things that we're looking at. We never make it cut and dry, that's probably because personally I don't think anything is ever cut and dry, especially this space and shopping behaviors across, not only brands but the platforms those brands are on, and that's how we look at it. I know that's a lot, and that sounds a bit crazy, but we do really pride ourselves on, again, using these things as a jumping off point and then really diving in deep and making sure that we're serving our audiences, again, where they like to consume this content.

Stephanie:

Got it. Yeah. It sounds like everything is very custom, and every channel and project you start from scratch where you start figuring out what your audience might like. But, do you have any internal formulas where you're like, "Well, we always follow this in the beginning." and then, it goes crazy after that, because we find other things out. Is there anything that's similar among all the campaigns or projects that you're working on, at least from a starting point?

Chris:

Yeah. I think, honestly, it's probably not surprising whenever you're talking about items on sale, or whenever we're talking about certain merchants, or price points, or categories, like organizing and cleaning is always up there for us. We know very specific furniture categories that do very well for us. So, we do have our basic what we call playbooks that we start off with, but like you said, we still are always constantly learning and pivoting as necessary. I think a perfect example is in the beginning of the year, I don't think anyone in this world saw what was coming, so we were doing our thing, and then when everything started to unfold, we got together and we had to pivot. And again, the good thing about Discovery's brands is, again, we are so widespread in terms of the categories that we're experts in, that we were able to easily pivot and, again, make sure we're giving our audiences what they need at that moment.

Stephanie:

Do you see more companies starting to shift? Like media companies turning into ecommerce companies, and ecommerce companies turning into media companies. I've heard that saying quite a bit, especially over the past six months, but it feels like you guys have been there for a while. Do you see other companies looking to you for maybe best practices of like, "How do I make this shift?" Or, "Should I make this shift?"

Chris:

100%. I think, the beauty in that is that we can coexist and really do things that benefit each of us. I don't think this is an either, we succeed or they succeeded. This is, I think a space where we can coexist. The way I always like to frame this when I'm talking to our merchant partners, and talking internally, is we're really here to humanize the star review. When you come to us, you're not just going to see, again, this is a four out of five, or this is a five star, item, and that's it from the random ecosystem of the internet. We are heavily focused on saying, "Look, here are the things we recommend, and why." And, I think that's where our partners can really leverage us, and where you're really seeing us shine. Again, we don't have to just throw a bunch of random stuff out there and hope for the best.

Chris:

Again, given our brands and our standing in this space, we can really leverage our expertise and authority there when growing this portfolio with all of our partners. To be honest with you the thing that drove me to Discovery the most was, "Wow, these are huge brands, with huge audiences, and huge respect. Now, we just got to tie all of that together, and go from the moment of inspiration to action." And then again, that's what we've been working on.

Stephanie:

That's really cool. With all the data that you were mentioning earlier, since you joined have you seen any changes in consumer shopping behavior?

Chris:

So, yes. Obviously, the biggest one occurring this year, and that was with online grocery. I think it's no surprise that it's been building up now for a year or two in terms of mainstream, but it never really caught on. It's only a five to 10% of folks are really engaging and entertaining the online grocery space. But then again, obviously, earlier in the year when things started to shut down, and people were uneasy about going out, we did see huge spikes in that space, obviously, on our FoodNetwork.com site. And, I would say that continued for a bit, and did peter out a bit recent months which, again, is obviously expected. So, I think that's probably one of the big ones.

Chris:

The other thing that we have seen, not so much in terms of major shifts in shopping behaviors, just more increased sales in categories that we already know are performing. So, organizing and cleaning is always been a winner for us, and then as the months went on, we've just seen it doing better for us. I think we do a lot of buying guides where we talk about the best cast iron skillets on Food Network, or the best humidifiers on HGTV. We started to see those things gain more and more traction as we went, and we're attributing some of that to us really getting our audience to trust us, and now know that they can come to us as a trusted resource to really be a personal shopper for them.

Chris:

And again, we've seen that across the board in all of our main categories. The only other thing I'll say in terms of, not only, I wouldn't say shifts in behaviors, but just something else we've pulled out from the data is that, everyone loves a good deal and good price points, but our audience is willing to spend more, especially when those items are either offered at a discounted rate for a holiday or something, or if we've worked with the merchant to get an exclusive discount for our audience, so we have also seen uptakes in that as well. But again, holistically, we haven't seen any huge shifts outside of, like I said, the online grocery, which again is expected given the situation we've been in.

Stephanie:

Yeah. That makes sense. Yeah. I saw for the Food Network, I think you had a subscription platform and you partnered with Amazon. Was that something that was already in the works, or did that get sped up once everything was happening with COVID?

Chris:

Yeah. So, that was already in the works with our DTC group, and for folks who don't know that's our subscription platform on the Food Network side that we call internally FNK, because it's just easier. And yes, that was in the works, and again we're working more and more in getting that to more and more folks who are really looking to get more classes, get more recipes, just be more intimate with our brand.

Stephanie:

Yeah. It looked very cool. I was on there looking around at, "Oh, you can follow these chefs and have cooking classes with them, and then you can tell your Amazon Echo to order it for you the exact things you need." And, it looked like it would be really fun to engage with that.

Chris:

Exactly. It goes back to that 360 approach that we have really been focused on, when it comes to our shopping portfolio.

Stephanie:

Yeah, that's very fun. So, you've talked a lot about partnerships where you've touched on a bit. But, tell me a little about what does a partnership look like from beginning to end? What does that process look like when you're finding a partner, figuring out how to actually strategically partner with them in a way that benefits both parties? What does it look like behind the scenes?

Chris:

Sure. So, I think there's really two paths there, there's the partnership stuff that we handle directly with merchants through affiliate networks, and so on and so forth. And, for that we do a lot of research on our end, again we already know what type of product hits, what type of merchants hit. So, one thing we do is take that and then say, "Okay. What are similar merchants in this space?" And then, we'll reach out and discuss the opportunity of working together on that front. And then I would say, on the other side, bigger picture stuff is, again, we're heavily embedded with our ad sales team on much larger partnerships.

Chris:

And, I think a great example of that is our shop the look campaign with Wayfair, which is a deep integration that spans across linear and digital that, again, was really spearheaded by our sales team that we then came in and assisted with. But, for folks who don't know, basically what this is, when you go to any of our photo inspo on hgtv.com, you'll see a little flyout of all the products within the image that are shoppable on Wayfair.com. And obviously, that's not just a basic integration that you just wake up one day and do. So for that, we came together and we've said, again, "What can we do that is going to benefit both of us, that's going to serve our audiences for the long run, and really make a successful integration here?" So again, that's what turned into shop the look.

Chris:

It's one of our best partnerships that we have across our dot-coms right now, and it's super successful, our audience loves it. And again, I think It's always starting with, "Well, what is the goal? And, what do we want to achieve from this?" I think sometimes people get too focused on, "What looks cool?" And like, "Let's just do that." We wanted to really focus on, "Well, what's the goal here?" And, what do we think we can create that's actually going, again, to help our audiences that come to hgtv.com be inspired and feel comfortable, making purchases based off of what they're seeing.

Chris:

So, that's really how we approach these, we're super particular about who we work with, and what that looks like. You mentioned the Amazon partnership, we have a really strong relationship with them as well. And for us, again, it's always looking at the brand and our audiences first and saying, "What makes the most sense for them?" And then, that's when we start peeling the layers here, and figuring out what are those experiences that we could bring to them on different platforms.

Stephanie:

Yeah. I think that's really smart. Like you said, not to just do something because it looks cool or seems cool, but actually do something that you know the audience will like, and will convert into sales to also help the partner. What are some of the success metrics for the shop the look campaign for example? What did you go into hoping to achieve when you set up that partnership? Is it affiliate based, or what do you guys look for and be like, "Oh, this is a successful campaign versus the previous ones that were maybe okay, or good."?

Chris:

Yep. So, I think just simply put it, consumption and sales are the big ones. Consumption being, are we seeing more and more folks coming to these different integrations across our platform, and then again how are they translating into sales? Looking at things like, "Okay, so we are getting them to Wayfair.com, but once they're on Wayfair.com what are they doing?" So obviously again, looking at conversions, average order value, so on and so forth. Again, just to really gauge what these audiences are looking like, as the days, weeks, and months go by. I would say, one of the things that we were looking for, especially as COVID first hit was, "Are we seeing an increase, a decrease? What are we seeing in terms of shopping behaviors across our platform?" And again, the metrics we looked at for that was, obviously, click through rates, conversion rates, average order value. Because we even saw in some instances where experiences weren't driving as many views or clicks, but the average order value was much higher.

Chris:

And again, just goes to show that our audience is a very qualified audience that trusts us, and is willing to spend with us. So, we try to pull out all of these different metrics. I think one of the things with commerce that is either for better or worse, is that you can't just look at one metric and just live and die by that number. So again, that's why we have a handful. And look, we also pivot based on what that platform is, what the experience is, who the partner is, so on and so forth. So, we don't have a one size fits all solution, again, that was done by design. And, that's how we approach these things. And again, just making sure that we stay true to who we are, and we're benefiting everyone involved.

Stephanie:

Got it. How do you keep track of, if there's a TV viewer who's watching HGTV, and then you're trying to send them to maybe Wayfair to shop that look like, what are the best practices with converting those people, but also keeping track of them in a way that's not maybe creates friction? Are you telling them, "Go visit this URL."? Or how do you go about that?

Chris:

Yeah. So, totally right. I think, obviously, the most common ways of driving from linear to digital is the QR code experience. And, we're actually working on some of those solutions as we speak and trying to understand, again, what will it take to bring more linear folks from TV down to digital, and like you said, make this a frictionless seamless experience? So again, is that as simple as a QR code, or again is this more about a stronger deeper integration that's a bit more sophisticated and partnering up with folks who can actually understand what is on screen at any moment, and then surface that product on screen.

Chris:

Again, if you have a smart TV and allowing folks to enjoy that experience, or again, when it comes to TV E we have our go apps that you could log into with your cable subscription. And again, obviously, it could be more sophisticated on your mobile device. So, what does that look like? Is it again, while you're watching it at minute three or whatever, five minutes in, do you surface what is currently being seen in the screen and saying, "Look, shop this room?" And, what do you do from that point down to the device. Can it be as simple as just a tap to buy, or do you have to tap and then open up a new browser window? What do those integrations look like? Again, ultimately trying to find the most frictionless experience. So, I think we're still experimenting with that. I don't think anyone in this space has really nailed that down in terms of what is shoppable TV, or just shoppable video in general? And again, how do we go beyond what just looks cool and turn that into actionable?

Stephanie:

Yep. Yeah, I think creating a frictionless experience is key, and there's a lot of room for innovation in that area. I'm even thinking about just Instagram, where I'll find a blogger I like and I really like her outfit, and then it's like, "Okay. Well, now go to the link in my bio." And then, that's going to open a LIKEtoKNOW.it app, and then maybe you'll be able to find the outfit. But at that point, it's probably just on the home screen if that new app. And, it just feels like there's so many places for a customer to drop. I guess I was just really eager to look at that outfit, so I stuck with it. But any other time, I probably would been like, "Oh, that's too much work." It seems like there's just a lot of room for innovation around this shoppable moments, whether it's TV, social, video, audio, anything.

Chris:

Yeah. I mean, I think you nailed it right there. I think Instagram is a perfect example, and that's a platform we're looking at as we speak, and we have some ideas around that as well. Because like you said, our goal here is to, how do we cut out all of these extra steps that are unnatural? Normally, when you see a product you like, you want to be able to say, "Okay. Great. Let me buy that." Not let me go to a bio, let me click this link, let me wait for this page to load, let me do that checkout experience is completely different from the platform I was just on. And then obviously, you're playing around with browser settings and everything else.

Chris:

So, I think you're spot on, and again that's something we're heavily focused on, again, literally as we speak. And, what does a more integrated Instagram shopping experience look like for Discovery and our partners? So, there's going to be more to come on that soon. But, we are thinking about that, and trying to find, again, these ways to make it as frictionless and seamless as possible. Again, no matter where our audience is consuming our content.

Stephanie:

Yeah. Well, it seems like if anyone can figure it out, it would be all because it's not like you're trying to put your products on someone else's show, or having to utilize someone else's platform. You have your own platform, you have your own shows, you can build new shows, and try out different ways to influence. There's shopping behaviors. That seems like there's just a ton of opportunity for you to experiment with everything that you all have.

Chris:

Yeah. No. A 100%, and those are these ad conversations we're having with a lot of our partners as well, and understanding from their world how they see it, and then bringing our world into that, and marrying that together, again, so we can coexist here, and at the end of the day just create a better experience for our viewers.

Stephanie:

Yep. Love that. So, what are some of your favorite platforms that you guys are experimenting with right now? You said, you were looking into Instagram, but what's really performing for you, and what are some of the more moonshot platforms that you're trying out, and you think it will be good, but you're not so sure?

Chris:

Sure. Yeah. I mean, obviously, the bread and butter is our shopping content on our dot-coms, those are our top performers. But, I will say some of the more areas of interest, again we already spoke about Instagram. But, another one where we are seeing some really good traction, believe or not, is in the Apple News space, most notably on Food Network. We're getting a lot of traction on that platform, and seeing what our audiences are resonating with the most on Apple News, which I again I know it maybe a shock to some folks, but I think-

Stephanie:

Yeah. So, tell you more about that. I mean, I have an Apple phone, but I have not opened up Apple News probably since I got the phone, so tell me more about, what are you guys doing there?

Chris:

Sure. Yep.

Stephanie:

Because you're the first person who said this.

Chris:

Okay. All right. Again, understood I know that's not always the first thing that jumps into someone's mind when you're talking about commerce, and lifestyle brands, especially because they name Apple News. But again, I know you don't really use it, but again this is just the basic free version that's included with your device when you get it. And again, we're syndicating our day-to-day content onto that platform. And, we've built really strong audiences across Apple News. And again, it's a similar experience to our dot-coms, just slightly different because it has to fit obviously the specs of the Apple News platform. But again, we just have seen some really strong successes in different areas, again most notably in the buying guide space, or sales events that are happening, and dabbling with pushing notifications for that.

Chris:

Obviously, with some of the recent shopping events that occurred, we built a push notification strategy around that as well, and it did really well for us. So again, I think that's one of those ones that is also intriguing to us. But I think, again, the high level, we really are trying to be everywhere it makes sense, but also really tailoring our content and strategy based on what that platform is. So, for some of the stuff that's working on Apple News may not make sense for Instagram or vice versa, so on and so forth. So I think, again, those are two areas. And I would say, the last thing that we're really, or me personally is really intrigued by, is this universal cart experience/straight to cart experience that more and more folks are dabbling with. There's a handful of platforms out there that can help publishers do this.

Chris:

And for folks who aren't familiar with this, it's basically saying, if someone comes to HGTV, or FoodNetwork.com, or tlc.com, and they see an item they like on there, instead of saying, "Buy now on X merchant site." And getting thrown off to that merchant, you could hit buy now, or add to cart, and you could actually check out within our platform, which I think is definitely going to be a big piece of the puzzle for the future of commerce on digital publishers. I think the big question will just be adoption, and then what does that look like. I think, again, Discovery is in a perfect position for this, because folks are already coming to us for this expertise, and know and love our brands already. So, there won't be a lot of convincing in terms of like, "It's okay to check out with us as well."

Chris:

But again, we're anticipating some shopping behavior adoptions that are going to occur during that process. But again, I think that's an area where you really start to open up a lot of new doors here when it comes to shopping for digital media sites. And, I think that's when it gets even more exciting for deeper integrations with Instagram shopping for example.

Stephanie:

Yep. Yeah, I love that. I mean, I'm excited to look into the Apple News more. And, I was just intrigued by that, because I like hearing things that others have not said yet. Because I'm like, "Oh, that means there could be opportunity there if you know how to work with the platform." Especially, if you can set up a push notifications. That's huge to make it in front of Apple users. And then yeah, I completely agree about the being able to shop instantly from a page. We just had the CEO of Fast on, Domm. And, I thought it was really interesting how he was talking about how every website should have buy now buttons under every single individual products, and he went into the whole thing of, "You actually will have higher conversions." Because of course, I was like, "Well, then you have to get past the minimum shipping amounts, and maybe higher order values, if you let me add stuff to a cart." And he said, "Based on everything they've seen, people will buy more if they can buy it instantly." And, it'll batch it in the background and ship it out after the fact, all together. So-

Chris:

Yeah.

Stephanie:

... I think you said it.

Chris:

Yeah. Convenience is key. I mean, everyone likes convenience, and again that's our hypothesis as well here, that we do plan to see increased conversions by building a more intimate shopping experience across our dot-coms with a lot of our partners.

Stephanie:

Yeah, that's great. So, the one big topic I also want to touch on was about audience development. So, when you guys, you have these huge audiences that you can tap into, but for especially a smaller brand, I want to hear how you all think about building that audience to then eventually being able to sell some products to them as well. What does that process look like? And, how can a new brand do that?

Chris:

Sure. So, I think first and foremost, I think it's important to understand what is audience development as it relates to your brand and organization. I think the biggest misconception with the term audience development is, "Oh, yeah, it's just another word for marketing." But it's not, and this has been written about it as well. And, I think the easiest way to think about this just in a very basic form is, marketing is more about how you want to look to the world as you bring those audiences in initially. More on the branding side of things, whereas dev is now like, "Okay. So, who are we to the world?" And, really drilling down on understanding those audiences that were brought in and who they are, and then building those audiences through different engagement tactics and community tactics.

Chris:

So, I think that's always a good place to start, to understand how those two worlds kind of then meet. And then once that happens, to answer your specific question, again start with understanding who your audiences are, and where they are. I think sometimes and probably not so much now, but in the past when I was first getting into this space, I think a lot of people just thought that, "Well, content is content. It could be put anywhere, and it's going to work the same way everywhere. Obviously not the case, even more so for shopping content, and behaviors. So, it's really, again, drilling down and pulling out insights based on, "Okay. Who is my Facebook audience? Who is my newsletter audience? Who is my Apple News audience?

Chris:

And, really starting there, and once you understand high level who they are, what they like, what they're consuming. More specifically when you talk about newsletters, what type of keywords are working to increase open rates, and so on and so forth, then you could start drilling down on the specifics. Saying like, "Okay. High level, here are the different topics and content archetypes that are working, now how do we build out an editorial calendar with that in mind." Again, with the understanding that we're not just going to set this and forget this across the board. What this looks like in newsletters is going to be slightly different than how we're positioning it on Facebook for example, and so on and so forth. So, I really think that's the key right there, and using data to your advantage and saying, "Okay. Well, here's all the different metrics that we're currently compiling, which ones can we look at, and pull from to better understand what these audiences are coming to us for." And again, working with your editorial teams, and the branding teams to bring that all together and say, "Okay. Now here's the plan for output."

Stephanie:

Yep. Got it. So, if you don't have an audience, and you're starting really from scratch, where would you start? Because I read quite a few articles, maybe from your past life at other companies about you increasing conversion rates by 60%, through maybe newsletters or increasing newsletter subscriptions? Is that maybe a place that you would start? Or where would you recommend someone brand new, who's like, "I don't really have an audience. I have five followers on Instagram."? What's the best way to acquire an audience and then keep them around to build it?

Chris:

Yeah. So I would say, if we're talking about limited resources and funding, I do think newsletters are a great place to start. And that's really because, it gives you an opportunity to have this one-on-one intimate relationship with the folks on the other side that for the most part you're not having to be held against what the algorithm is going to decide to show at any given day. Obviously, you have to worry about, spam and junk mail and things like that. But for the most part, if you're running a really clean newsletter list or lists, you don't have to worry about that so much. So, I do think, starting in the newsletter space is a really low budget, friendly way to start growing audiences, and it's really great to use as a gut check to see what is resonating. You could look at your open rates, you could look at your click to open rates.

Chris:

Again, you can monitor what the churn is and stop to see if what you're producing is causing people to drop off for good, so on and so forth. So I do think, for publishers where it makes sense that is a great place to start. You can obviously acquire new users through a bunch of different audience development tactics, whether it's on site widgets or modals, or do some small paid spend to try to bring folks in, and do the sweepstake partnerships as well. Again, obviously I'm a little biased, just because that is part of my background. But again, over the years, newsletters, again, I know they're not the sexiest platform to talk about, but they have been the most consistent in terms of performance and really bringing your most loyal and engaged users from that platform.

Stephanie:

Yeah, I completely agree. And, you also get access to quite a bit of data that you don't on other platforms, and if you can figure out how to properly engage with them, you could have newsletter subscribers for years to come, which is everyone's goal.

Chris:

100%. Yeah. And, I think even to take that one step further, you could even start to get more and more personalized where you get to a point where you're launching a newsletter to half a million people, and no two newsletters are alike because it's all based on past user behaviors that you were seeing within email and the dot-com, and again adjusting that based on different predictive intelligence tools. So again, I think 100% there's a lot there, and if done correctly, and go a long way. I mean look, this has been tried and true in the space. We see a lot of folks who start there, we're even seeing in the news media space a lot of journalists, and editors, and things like that backing off from the larger brands, and going this newsletter route to get their word and opinion out. So yeah, I think email is here to stay, and it's going to be a huge piece of the puzzle moving forward.

Stephanie:

Yep. I agree. So, you've been in the media world for a while, I think I saw at least back to 2012, maybe even before then.

Chris:

Yeah.

Stephanie:

I went as far as I could on your LinkedIn, I think it cut off.

Chris:

No, you got it. Yeah. I have been in media basically since the day I got out of college. So-

Stephanie:

Okay. Well, this is the perfect question for you then. What do you think the future of online commerce in media look like? Maybe in 2025 or 2030, what does that world look like?

Chris:

Yeah. So, I think it's going to be an extension of what we talked about a little earlier about this universal cart experience, and turning digital publishers into this space where audiences can come and also feel comfortable making those purchases. And again, not being bounced off to third party sites, and really being able to start building an even stronger shopping relationship with your audiences, because again with a universal cart experience, also comes a lot more first party data where you could, again, focus on more one-to-one relationships with your audiences, again, specifically in the shopping space, which I think is key.

Chris:

And, I don't foresee a place where merchants are going to have a huge problem with this, because, again, you're just helping to legitimize their product. Like your previous guest said about increased conversions. I think that's another huge piece of this puzzle. So again, it's really just now, again, bringing this all together, this whole 360 approach and saying, "Look, you're not just coming to us for flat inspirational content, you're now coming to us for the inspiration, and the ability to take action immediately." Again, versus being bounced off to one, two, three other platforms depending on which platform you're on, like your experience with Instagram.

Stephanie:

Yep. Yeah, I love that answer. Really good. So, now that we're talking a little bit about the future, what do you not understand today that you wish you did?

Chris:

What do I not understand today that I wish I did? That's a that's a good question. So, as it relates to commerce?

Stephanie:

Yep. Or the world, where you're like, "I really just wish I knew more about this." But yeah, it could be a commerce one, that would be cool too.

Chris:

Sure. I would say, I think not so much about not understanding this, but more not understanding why it's not better. And, that goes back to, I would probably say, affiliate data, and what that data looks like, and what partners have access to, or don't have access to. Obviously, being a part of many different networks, and merchants being on all different networks and so on and so forth, it becomes, quite difficult to manage all of that data coming in, and really having a platform that can easily bring this all together in a unified way. We do have a really strong partner that we work with to aggregate a lot of this data. Again obviously, it's never going to be perfect, because you're pulling it from all different places, and you have to understand, "Well, how does this platform leverage conversion rates and click through rates, versus this platform?" And again, just like, "What do those measurements look like?" And, the methodology behind them.

Chris:

So, that becomes challenging. But, I do think that's probably one of the biggest things that I just wish. And, I know it's not easy, hence the reason why it hasn't really been done yet. But, finding a more universal way to bring all this data into one data warehouse. Again, we were working on some stuff along those lines, but just high level, just generally speaking in this space, I do think that's one of the more challenging situations that a lot of digital media folks are in when it comes to with the shopping space.

Stephanie:

Yeah. That's a great answer. It does feel like a lot of technologies in general started out in that way. Very chaotic, things are everywhere, data is everywhere, and then things eventually end up in a dashboard, or it starts coming together in a more useful way. So, I hope that world comes to be in the future as well.

Chris:

Yeah. I mean, look, at the end of the day, that's only going to help all parties. It's going to help the audience, it's going to help the media company, it's going to help the merchant, so there's definitely reason to really get this right. But again, then, to do a bit of a 180, I think that's why you're going to start seeing these universal cart experiences take off more and more, because it does make that a bit cleaner in terms of what you're going to have access to and when.

Stephanie:

Yep. Very cool. All right. So, we have a couple minutes left, and I want to jump into the lightning round, brought to you by our friends at Salesforce Commerce Cloud. They're the best. This is where I'm going to throw a question in your way and you have a minute or less to answer. Are you ready?

Chris:

Let's do it.

Stephanie:

All right. What's Up next on your... Well, do you have Netflix? I would say Netflix, and I'm like, "He's going to be like, "No.""

Chris:

I do.

Stephanie:

Okay. What's up on your queue? And then, you can also tell me what's up on your Discovery queue?

Chris:

Fair. So, I'll start with us first.

Stephanie:

All right. Go ahead.

Chris:

And, I think this is so obvious, but huge 90 Day Fiancé fans. And, I will say my wife actually started that. I wasn't always, but she was like, "Come on, we got to watch it." And, this was a couple years ago. And, once I started, we have been heavily invested ever since. So, from a brand standpoint, we're 90 Day through and through. So, I think again-

Stephanie:

I like it.

Chris:

Yeah. Probably obvious to a lot of folks just because of the success of it, but that is our thing there. And then, she's also actually a huge fan of Discovery ID, it's her favorite channel by far. So, we got both ends of the spectrum there, right?

Stephanie:

Yep.

Chris:

Discovery ID, the DLC. But again, that just goes to show the strength of our portfolio. And then, on a personal front, I would say, what we're actually currently watching is the Borgias on Showtime. If you haven't watched it, I highly recommend it. But, it's three seasons, so that's good for me. I'm not a huge binger, but I can get through a three season watch, so we're currently in the middle of that.

Stephanie:

Cool. I have to check that out. Yeah. 90 Day Fiancé, so I have a twin sister, and she's obsessed with that show, and she's been telling me I need to watch it. And, I've been like, "No, I'm not watching that." So, now that you say you also enjoy it, maybe I'll have to want to check that out.

Chris:

Yeah. Come on. It's only fitting now. You got to at least give it a shot.

Stephanie:

Yeah. I think I will after this. That'll be the rest of my day.

Chris:

Perfect. So, I've succeeded tonight.

Stephanie:

You did-

Chris:

I converted someone.

Stephanie:

You can tell everyone, "I got a conversion."

Chris:

Exactly.

Stephanie:

What's Up next on your reading list?

Chris:

On my reading list. So, this is also probably slightly depressing, but I'm actually currently reading the Plague.

Stephanie:

That's [inaudible 00:49:47]. I mean, I don't even know what that is, but I'm like, "No." I mean, is it good?

Chris:

Yeah. I mean, so far, I'm only maybe a quarter of the way in. it's just eerily similar to the situation we're currently in, and obviously this was not written recently. This is old Camus. But yes, so that that's what I'm currently reading. So, not exactly an uplifting read, but I do think interesting to say the least in seeing some of these parallels that, again, just six, seven months ago we thought were just crazy things you would read or watch on Netflix.

Stephanie:

Yeah. Well, if you enjoy the full read, let me know, maybe I'll check that out.

Chris:

Will do.

Stephanie:

Next up, if you were to have a podcast, what would it be about, and who would your first guest be?

Chris:

That is interesting. If I had a podcast. For me, I think I probably wouldn't fall into the current podcasting world that pulls a lot of talent from different areas, and makes that the centerpiece of their podcast. I would much rather try to get in the weeds with folks who are making a difference on a local level. I think especially in this political climate, I think that sometimes gets lost that we think it's only the top that matters, and nothing lower does, which I think is completely false. I think everything starts at the local level. So, I would love to give more exposure and light to those folks who are doing the dirty work on the ground which, again, sometimes gets lost in the standard media cycles, or across social media for example.

Stephanie:

Yes, I love that. It's also something we're exploring here at Mission is local level podcasts, because I think that's what people are leaning into now. They have lost that also a sense of community with everything that's been going on, and you might want to know what your neighbors or community is up to, and also what they're doing, like you said, on the ground level. The next one-

Chris:

100%. I think it's super important. Go ahead.

Stephanie:

Yeah. What does the best day in the office look like for you?

Chris:

The best day. So, when that was a thing-

Stephanie:

When you went to the office, and you weren't just in your house in New York.

Chris:

Exactly. Honestly, the best part about that is, being able to... And, now I feel it even more, is having that change of scenery, and being able to have those face-to-face interactions with folks. I recently read a study where, I think it came out that people were actually working longer hours, and having more meetings, while working from home, because they don't have those passerby conversations in the hall, or going in and out of the restroom, and so on and so forth. Which, again, I don't think people appreciate until it's gone. And for me, that's been a huge piece of the puzzle that's been missing during these times is that, human interaction. I think everyone wants to think that working from home is the future, I'm just not sold on that yet.

Stephanie:

Yeah. I think the flexibility, maybe, but I think a lot of people are eager to get back and see their coworkers, and have coffee together and whatnot. So, there'll be pent up demand, as economists would say.

Chris:

Exactly.

Stephanie:

All right, Chris. Well, this has been such a great interview, where can people find out more about you and all the fun work you're doing at Discovery?

Chris:

Sure. So personally, you can find me, Chris Mainenti on LinkedIn, and we can connect there if you'd like to chat further. But more importantly, if you love our brands, you know where to catch us on TV. And then, similar to dot-com, HGTV, Food Network, TLC, Travel Channel. We're everywhere and we look forward to continuing to serve our audiences wherever they are, and really helping them through these trying times that we're all in.

Stephanie:

Yep. And most of all, go watch 90 Day Fiancé, everyone. I mean, I feel like you need that fun.

Chris:

Exactly. For the handful who haven't yet, including you, obviously.

Stephanie:

Yeah. I know. Such a veil. All right. Thanks so much, Chris. It's been fun.

Chris:

Likewise. Thanks so much again. Bye-bye.