Up Next In Commerce

Up Next In Commerce

By Mission

Welcome to the #1 podcast for eCommerce teams, executives, and entrepreneurs. Join host Stephanie Postles as she sits down with eCommerce leaders on the front lines of digital innovation. With guests from established enterprise companies to D2C start-ups barely out of infancy to everyone in between - you’ll get the inside scoop on what’s Up Next in Commerce. New episodes come out every Tuesday and Thursday. Up Next in Commerce is created by Mission.org and brought to you by Salesforce Commerce Cloud.


Shake Shack’s Ecommerce Shake Up

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.---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---Transcript:Stephanie Postles:Hey there and welcome back to Up Next in Commerce. This is your host Stephanie Postles, CEO at Mission.org. Today we have Steph So joining the show, the VP of Digital Experience at Shake Shack. Steph, welcome.Steph:Thank you. Thanks for having me.Stephanie Postles:Yeah, I'm really excited. I mean, when I saw you guys coming on the show, well I first got hungry and then I started looking for locations of how close are they in Austin? Can I find a location to go try out before we have this?Steph:We have that effect on people. We love that.Stephanie Postles:I know, it's good. So your career has span across so many industries; fashion, beauty, health. It seems like you've done it all and I was hoping we could start there and hear about your journey in all these industries?Steph:Yeah. It's been a long and winding road. I always like to tell the story that it actually all began with restaurants. So, my very first job was waitressing at a small sushi place in the Bay Area in California where I grew up. Really what brought me to New York was also food. I really wanted to explore all that the city had to offer. I had lived on the West Coast my whole life. My first summer after college, my freshman year of college, I decided to just come to New York, see what it would be like. I've always believed that working in restaurants opens doors for you that you might never expect.Steph:So, my very first summer in New York City I worked for a fine dining chef for the summer, as a waitress in her restaurant as a server. Learned everything that she could teach me in three months about wine, fine dining and food and really fell in love with hospitality as an industry. But, back to the long and winding road, I touched a lot of different industries before making my way back here. And I often tell folks, just follow your interest in passion and you will never know where it will bring you. I'm excited that it brought me back here.Stephanie Postles:That's awesome. I, a fellow waitress here. I was a bartender, waitress and at one point when I was 14, I rolled silverware for eight hours a day. I'm sure you know about that life.Steph:Yes, all that side work is what builds a lot of character. And similarly when I went back to the Bay Area after being in New York, I felt like I had to have every job. So I tried bartending. I tried hostessing. I had every seat in the restaurant, probably except for a chef, which is probably for the betterment of everybody else. But, yeah it was such a great experience and the hum of that excitement has never really left me.Stephanie Postles:Yeah, do you still have the server dreams?Steph:Of course.Stephanie Postles:Okay, you exactly know what I'm talking about.Steph:When somebody has something wrong with their plate or something is wrong with their dish and you have a panic attack because you really want to fix it. Yes, for sure.Stephanie Postles:Yeah, you're like, "Ugh, forgot the ketchup for table 25. Oh, that was two days ago."Steph:Those dreams are now augmented with the digital dream, which is like, "Oh, my God something on the website has crashed and I can't figure out what it is. So, there are different nightmares with each field.Stephanie Postles:Yeah, they all come in different stages of your life.Steph:Yes.Stephanie Postles:That's great. So the one thing I also read, which I loved, was I think someone was asking how are you attracted to these industries? How do you go from here to here? You're like, "It's not about the industry. You should just be focusing on the customer." I would love to hear how you think about that when you were moving around in so many different areas?Steph:Yeah, I truly believe that digital and the customer have equalized so many things about the way we all, as consumers, want to experience brands. So, now we all have a phone. And we all have this digital life that we're leading in parallel to our physical lives and maybe in the last year we've brought these even closer together, our digital lives and our physical lives. I think that digital does a lot to bring brands to life in a way that even physical retail in many ways was difficult to bring things to life. And I've always been really focused on that, because I think the consumer experience is so interesting. The consumer I was finding, as I hopped between beauty and fertility and fashion, all of these things that consumer was the same.Steph:What they were looking for was the same. They wanted a brand that they could identify with, that spoke to their core values, that really made them feel safe but also understood. And all of that can be communicated in a digital way, I think with great consistency. It is a little bit more challenging as you scale people operations and retail operations to bring that to life in a physical way. The interesting thing about Shake Shack is actually I think we built this physical infrastructure, this physical brand that is a community gathering place, that has hospitality at its core. So we almost had that going first and then that's what's exciting to me is bringing that same consumer into that experience and then also bringing digital into that experience and translating that out. Yeah, I still do believe the consumer is at the center. They're experiencing all these brands in a really digital way. And the brands that are successful are the ones that can connect and translate their brand in that way.Stephanie Postles:Yep, yeah. I love that. A couple years ago, I forget which book I was reading, but it was essentially saying if you're looking for creative ideas in your business today, go to a completely random industry. Go to the airline industry. Go to hospitality. Go to restaurant business and you will find something that can be relatable to your company today and open up Pandora's box of, "Oh, that's how they're doing it here." I can see maybe how you came from working at in these different e-commerce roles and you were at Ralph Lauren and you were at a fertility clinic and doing things there and being like, "Of course the restaurant business should also be implementing this app, or this way of communication," that maybe they weren't thinking about before.Steph:Yeah, 100% true. I think from skin care and beauty, to fertility was just such an obvious link because we were targeting this consumer that maybe she's in her mid-30s, thinking through various things in life and thinking about her goals and focusing on herself. I think that was such an easy link. Then as I looked at fertility and fashion and food, into hospitality, my view was where are people really spending their money these days? And so much of the way the consumer is thinking right now is spending on experiences. It's so much less about stuff. And I think it's been very interesting to see that evolution of the consumer mindset. Initially, when I was at Ralph Lauren and Shopbop and a lot of these really fashion and apparel focused brands, there was almost a cycle at which consumers were looking to replace their clothing and try on a new look when it comes to the season.Steph:I think that the consumer has really shifted and of course COVID has really pushed this even further. None of us actually care what we're wearing anymore, or it actually doesn't really matter. But I bet all of us would give anything in many cases last year, just to have a meal with a friend and gather somewhere just to hang out, have a burger and share a meal. And so, it really attracted me to hospitality to bring those experiences back to life. And I felt like so much of the way the consumer is starting to think about their day to day is really giving themselves those experiences is almost little treats and little uplifting moments in their day. So, it was really a draw to come to a brand like Shake Shack.Stephanie Postles:Yep. Yeah, I love that. So tell me how long have you been at Shake Shack now? When did you join?Steph:Yeah, I joined in December of 2019. It's such an interesting time because I joined and digital sales are coming through our digital channels here at Shake Shack, accounted for about 20% of our business. And I thought, "Wow, this is such an exciting opportunity to grow that 20% to maybe 25, or 30." And had started to set those goals. It was fascinating to see four months later in the throws of COVID, to just see that percentage fall on its head. We were very quickly 80% digital, which was a crazy ride to be on.Stephanie Postles:Yeah, that's wild. So what did that look like? I mean, what did those couple months look like? I think I read a couple articles where it went up to 80, then maybe it leveled back down to 60, which is still crazy to think about where you were. What things were you guys doing to even keep up with that digital demand?Steph:It was so interesting because the great thing about digital is that it can scale. So our app, our web platform, we're very lucky that from the IT side we were able to handle this massive influx of traffic. We did add additional security measures in place. We wanted to be very careful with the amount of data that was coming through that we could protect consumer data. That's always been a very important goal of ours. But interestingly digital could scale. What was more challenging to scale was the operations that come with that. So, our restaurants were not used to dealing with every single order having to be packaged in delivery type packaging. A closed clam shell for a burger, a sealed bag. So it was almost more challenging for our operators to shift to a digital mindset and that's been a really interesting journey to be on with them.Steph:Many of them have had to pivot and figure out how to provide our famous Shake Shack hospitality from behind a mask and when your interaction with a guest is so limited to just the, "Here's your order," and handing it out the window or handing it to a car window. It's been really inspiring for me actually to see how the operators have all taken this new business model and really made it their own. So that I think was actually the bigger adjustment for us instead of the digital platforms. I think we made improvements and we made tweaks to our experience, but it was certainly harder from the ops perspective to make that all come fluidly together.Stephanie Postles:Yeah. How did you retain those new customers? I think I read a number was like 1.8 million new customers, and you can tell me if I completely botched that number. It was above a million though.Steph:That's correct.Stephanie Postles:Oh, it's correct? Nailed it, yes. Okay, so you got all these new customers coming in, trying something for the first time potentially. How did you keep them coming back and keep them engaged so they stuck with the brand?Steph:Yeah, I think it was really initially last year about meeting the guest where they were. Of course we can get that first visit out of a guest who's really excited to try a Shack burger for the first time. Maybe our digital platforms make it a little bit easier for them to have a contact free order with us. So we feel that that first visit we got you and we can get you with the food and that experience. I think after that, it's really the guest experience that will keep people coming back. There are a few things that we've done in the last year that I think have really met the guest where they were. We've offered limited time offerings. So we've brought back, last fall we had a huge hit with our hot chicken sandwich, playing a little bit into those chicken wars. Recently we've been doing avocado as the most requested ingredient that we've been asked for many, many years. So we've added an avocado bacon burger and an avocado bacon chicken sandwich to the menu. So those things I think keep people coming back.Steph:I think we're a real believer in the thing that will make Shake Shack most successful is this feeling of it being a community gathering place. I actually think about that a lot within digital. That even if you're placing your order and having 80% of your experience in the digital channel, I still want that feeling of the brand as a gathering place, as an uplifting experience to come through that channel. Because ultimately, then you'll go to a Shack and you'll pick up your order. We want that interaction to be just the cherry on top of what's already been a positive experience. And that to us is how we're thinking about retention, that it has to be that seamless, and I hate to use this overly used word, but it has to be a seamless omnichannel experience from digital into the restaurant. And then post purchase as well. We love to get guests feedback and hear how things went and make it right if something went wrong.Stephanie Postles:Yeah, so how are you thinking about crafting those experiences now, where I feel like there's half the people are ready to go, ready to get out there, get back into the world. The other half maybe still a bit timid. What things are you guys crafting to be able to start bringing people together and creating memories, and doing everything you just talked about?Steph:Yeah. I think over the course of the last year, Shack Track was a huge initiative for us, which was about infusing our digital experience with lots of choices. So we wanted the guests to get their Shake Shack the way they wanted, whether it was via pickup, via curbside. In some cases we launched drive up and walk up windows so you don't even have to enter the Shack, but we'll have your order ready and you can get your order from the exterior of our Shack. Then we launched delivery within our app as well. So that was really to say, "Hey, however you want to experience Shake Shack, we want to make sure you can do it all from this digital platform." So Shack Track as an initiative was really about giving maximum flexibility to our guests, exactly as you said to get as out there as they want to, or stay as safe and on their own as they'd like to.Steph:What we've noticed is actually those channels are really providing more predictability for the guests around their experience. So they can basically say, "I just want to be able to know that I can pick up the order around this time." And many of them come in and are invited by this atmosphere and are starting to open up again and feeling like, "Hey, maybe I'll just sit here and enjoy the experience of sitting in a restaurant." We're seeing that more and more and I think that's going to be the trend over the next year as people start to come on back.Stephanie Postles:Yep. I wonder, it feels like a lot of not just restaurants, but stores in general are flipping inside out. Where it's like you don't really need as much as what's inside anymore. Why not have most things outside and pick it up and order it from the outside and then sit at a table, or just enjoy the outdoors. Which when I came to Austin actually, that was something that felt really big here, where I hadn't really seen much of that on the East Coast or even in the Bay Area. It wasn't as big of a thing as like here, everything's outdoors. All the restaurants are outdoors and it seems like that model might be accelerating, not just even with restaurants, but I mean thinking about some of the big home improvement stores. Why do I need to go in there if I can just order and just pick up on the curb? Why do I need to go through every aisle to find the specific nail. Obviously I am not a DIYer. Whatever I'm looking for, I don't want to browse around for it. Go help me find it and then bring it to me.Steph:I think that's right and I think our restaurants have always been very design led. We always like that feeling of an outside and our first restaurant in Madison Square Park is literally in a park. So, this year has been really interesting as our real estate and design teams have started looking at new locations of Shake Shacks because we are looking for very different things now. We're looking for that outdoor patio. We're thinking about things like heating outdoor patios where it make sense to do so. We're also thinking about things like accessibility for cars. So drive-through is something we've talked about is coming for us and that is a totally new format for us. We've never really looked at sites that were drive-through specific, but now we are. And trying to make that uniquely us. I think a lot of drive-throughs are almost very transactional and your very last ditch effort, got to get something to eat and I'm going to stay in my car.Steph:We would really like to again, bring our unique experience to that. But certainly, I think it's changed how we look at real estate and how we look at how we want to serve the guest and where the experience happens. I think it's exciting, especially now I live in New York City and see how the city has totally pivoted to keeping some of this outdoor dining. Sometimes it feels like a little bit like Spain, when you're on certain streets and you see all these elevated platforms and restaurants outside.Stephanie Postles:Yeah, I know.Steph:So I think there are elements of this last year that'll be great if they stay.Stephanie Postles:Yeah, I love that. When I was in Palo Alto they closed down University Avenue which was a big thing that cars would always drive through and they put all these restaurants out on University Avenue and everyone was like, "They should just keep it like this. Why do cars actually need to drive right down the center of here? They can go around." Yeah, I think a lot of businesses are starting to rethink that model of why do we need to confine people and use the rest for parked cars that aren't doing anything, which is an interesting world to be in now.Steph:Yeah, 100%. I worked at about three of those restaurants along University Avenue.Stephanie Postles:Oh, did you?Steph:So, I absolutely love that example because it used to be so different and I think we all used to be of course post-pandemic world will be very different. But I think we all used to be focused on what's going on inside and now I think everyone's like, "Just let me be outside." I think that hopefully will not shift back too quickly. I think people will still have that attitude for the near term.Stephanie Postles:Yeah, it does seem like there's, especially in fast food, seems like there has to be two drive-throughs. You've got the one for people who are like, "I want the experience, I want the full shindig. I want to be able to talk to the people who are providing the food." Then there's other people that are like, "Just need to get in and out. I know the food's great, we'll talk another time." It seems like there could be a cool split test to have a guide shop style store of which lane is utilized more.Steph:Yeah, this is something we've looked at.Stephanie Postles:Oh, really?Steph:So we just launched ... yeah exactly. We've looked at drive up windows. So drive up windows are basically you've pre-ordered. Your order is waiting, but you still don't want to get out of you car. Different from curbside in that you actually drive up to a window, but there's no ordering at that point. There's actually just a handoff to you. So we have two of these now operating in the Midwest and it's a hugely popular option for those two places. They love it. So one's in Fishers, Indiana. We're actually seeing a huge percentage of our digital orders choosing that experience of not having to get out of the car, having pre-ordered. We have this hypothesis around drive-through as a very different use case. It's a spontaneous moment. It's you're driving down the highway. I know this well, I have three children and there's this moment where everybody is cranky and hungry. Drive-through is almost a not a premeditated moment. It's a, "I need to get a meal right now."Steph:And so you do need to order on premise, and again from my own personal experience as a parent, there are those moments where you just are not ready to take three kids out of car seats. You just want to stay on track to wherever you're doing. So we really view it as two distinct use cases to your point, and we're certainly not opposed to this idea that maybe those experiences could live in parallel, or as we're learning we think there are some markets that will be primed for the drive-through option and some that'll be prime for a drive up option where it's like, I've already pre-ordered. So, we're excited. We think that's going to be a big part of how our business begins to shift as we continue to expand.Stephanie Postles:Yeah. But I think that als just shows the nature of how quick you all were able to shift, two new consumer expectations and keeping a pulse on what do people want? Okay, let's quickly, let's try it out. Then depending on the market like you said, some people might want different things. I mean, I have three kids and my three year old, when his blood sugar drops, I'm like, whatever there is. Gas station food, I don't care. Eat this kid. It doesn't matter.Steph:It's so true and I think, it's interesting as we go through this because living in New York City a lot of us on our team were trying to figure that out in terms of, "Hey we live in New York City. How should we launch a drive-through? There are no drive-throughs really in New York City." So we were all having these really funny meetings where we were really trying to digital into it. There are certainly folks on our development team who have not done a drive-through in many, many years. So that was a fun personal experience where I could say, "Listen, this is a huge part of my life. I hit a lot of drive-throughs just as a parent. It's a key part of our restaurant mix and choice. So it's been very fun to bring that experience to a lot of our projects, because there are definite use cases that speak to a certain consumer segment I happen to fit.Stephanie Postles:Yep, you represent me well too then. You can speak for me wherever you go. It sounds like we're very similar. So, how do you go about keeping your customers engaged, even when Shake Shack is not on their mind maybe. They're not even hungry. Are there ways that you try and pull them into this community? And maybe so when they are driving by you're like, "Hi, hello, we're over here in case you miss us." How do you think about that engagement?Steph:Yeah, that was a really interesting piece of taking this role for me. When I joined Shake Shack I think I asked our CMO at the time, "What do we spend on digital marketing?" And the number he gave me I laughed out loud. I was like, "Wow, I really think there's massive upside on that number. That's a number that I spend monthly for marketing a fertility clinic in New York City." He and I had a really good laugh about it and we said there's such great growth out there. I think digital marketing and I know a lot has been said about ads on Facebook and ads within our social media platforms, whether or not they're relevant and whether or not they're tracking, et cetera.Steph:But, we have seen tremendous growth of our digital guests coming through those channels and I think it is about the right creative, the right message and the right audience. So we've been very focused on increasing our relevance to that audience, keeping Shake Shack top of mind. It's been a great channel for us to share new features we have, like curbside or drive up window, or delivery now available in the Shack app. Those are things we can put out on paid ads that I think it's harder to reach people and it has been harder to reach people over the last year. So our digital guest acquisition has been really an exciting channel to double, triple down on.Steph:I think it keeps us top of mind and honestly what's been most successful for us is when we are going to open a new restaurant, we try to go out there with digital ads, before the opening, so that folks get excited. So that folks know they can download the app and be ready for opening day when we're usually crushed with people. And recently we've opened a few new restaurants where it's been exciting to see how many people have downloaded the app before us, even opening instead of standing in a long, snaking line on the first day. They're actually placing a digital order on their first day and having a more expedient experience on that. So that's been really fun and I think it's about, to your point, staying top of mind, preparing for your visit and getting excited for your visit. So it's a little bit more than just the need to eat something and driving by and less of a functional visit.Stephanie Postles:Yep, yeah. That's great. Are you giving coupons or other things to incentivize people to download the app and get them in there?Steph:It's interesting. We've tested many things and we have not had to incentivize with discounts. And that is actually a really core tenant of ours I think as we go through this. A lot of the premium brands that I've worked with have gone by the wayside, by over discounting. And I think it's no secret that in retail that that has been a really big challenge. Certainly with our challenge at Ralph Lauren in that the guests, the customer was only buying apparel on a semi-regular basis. And so almost waiting for the sale. So I think hospitality is going to continue to take some cues from what's happened in retail and be hyper focused on now being overly discount driven. So we've been really careful about how we divvy that out.Steph:We also look at our QSR competitors and think about value menus and dollar menus and what that means. Shake Shack's ingredients are very well known for using premium ingredients. We think there's value in providing these premium ingredients at accessible price points. So our view is to keep that as pure as we can. Not to say I think what we have found is the lifetime value of digital guests is so high, that somewhere in that journey we do need to keep incentivizing for frequency. So, we do a welcome offer that's somewhere in that first stream, but it's not how we acquire the first guest, the first touchpoint.Stephanie Postles:Yep. How are you viewing food marketplaces, like Uber Eats and Grubhub? Do you guys play with them? How do you think about that relationship, while also still representing your brand in a very different way compared to a lot of other fast food type of places?Steph:Yeah. I always talk about the marketplaces. We have great relationships with them. We are available on all of them. So we work with Uber Eats, DoorDash and Grubhub. I view them as a microphone for the brand. If you're hungry and you're going to order delivery, chances are you'll be going to one of those apps. Now if you're looking for Shake Shack, I would always hope that you come to ours. So, we have to be in mix with our third party partners and we do a lot of fun activations with them because, honestly it's great to split the check on talent if we do something with a partner. So for example, we did a really fun partnership with DoorDash and Boyz II Men over Valentine's Day. And we just thought that was so nostalgic and very brand right for us, brand right for DoorDash. What's more fun than a Valentine's day berries to men shake delivered by door dash. So it was a great experience in terms of getting to partner with talent, getting to split that check with DoorDash and we reached a ton of people through the DoorDash platform and we were happy to do so.Steph:I think those are examples of how we like to use our third party partnerships to do uniquely Shake Shack things, but with a really big platform. And then, on our own delivery we really are focused on making sure that that experience is great and if you want Shake Shack, we want to make sure that guests can choose the mode, whatever is most convenient for them. So they play a complimentary role.Stephanie Postles:Got it. Yeah, love the Boyz II Men thing. I wish I had seen that because that's an all time favorite right there. No one can say they don't like Boyz II Men. I mean, I don't think they can.Steph:We completely agree and it was such a fun partnership to work with them on Valentine's Day. We were not totally surprised, but it was just amazing to see the fan base turn out for Valentine's Day. So that was a really fun one and it inspired us to think about these cultural moments where talent, culture, brands, Shake Shack can all come together. So that's really how we've been thinking about a lot of the things we do is how can we bring that experience to the guest? That's been a huge part of this past year is we got to come to you because it's a challenging year. You may not be going many places.Stephanie Postles:Yep.Steph:That was a really fun one.Stephanie Postles:That's amazing. So what does it look like forming that partnership? Like you said working with talent, working with a food marketplace, bringing it all together. What does that process look like behind the scenes?Steph:Yeah, we worked super closely with them. We have a dedicated team that works with our third parties and I think the biggest thing about that is we want to be always focused on the thing that another restaurant couldn't do. I think there are a lot of cool celebrities and talent out there who work with a lot of different brands and I think we just are always trying to strike that balance of Shake Shack is known for a modern take on classic food. So Boyz II Men really fits that. It's the throwback to something nostalgic. So we love to have that line straddled between something that's nostalgic and something that's cool and culturally in the know. Shake Shack is like this culty brand in many ways. So, anything we can do to wink and nod at that little cultural zeitgeist I think is what we brief our agencies, what we brief our partners as these would be great partnerships.Steph:The other example I love to give is we most recently for 4-20 partnered with Action Bronson and Postmates. Action is so amazing as an influencer. He's hilarious. We think he's just perfect for 4-20 as the day. He celebrates and observes and it was funny because he was releasing his memoir on 4-20 and we thought this is so perfect.Stephanie Postles:Oh, great.Steph:So we partnered with Action and we basically said, "What would be the most ideal menu item for you on this day?" And he put together this double bacon Action Bronson Shack Burger which we thought was amazing and looked incredible. It's an item that we actually get asked for a lot. So we put it on the menu for 4-20, for this partnership with Action. He made a video which is him sharing how a Double Smokeshack makes him feel, which was hilarious. It's that. I think it's we know it when we've hit and the thing I love about our brand is that we can flex those, a very wide range of interest across culture. And so from one month Boyz II Men to the next month doing Action Bronson was just like a really fun testament to how far we can stretch our brand and our values. So it was great.Stephanie Postles:Yeah, I love it. That's so fun. How do you think about, I mean you joined during an interesting time. All of a sudden it starts accelerating really quickly. You're trying to figure out whoa, whoa what's happening in this whole new world and you were betting on digital being a certain percent. It skyrockets. How do you stay on top of innovating during a period like that? Because I'm sure you came in with a ton of ideas like, I'm going to do this, this. My first 90 days might look like this. Maybe some ideas that you thought were moonshots. And then all of a sudden you're maybe having to scramble a bit. How do you get back to that innovator mindset, if at all right now?Steph:Yeah, no I think that the last year, when I first joined we had a great roadmap that I was so excited about. The roadmap was like we need to innovate on our platforms. We need to focus on bringing actually a lot of our platforms up to par. So Android and web were my first focuses because those were our aging platforms and platforms we wanted to bring in house. So, we really focused on those two and that was going to be our big story for 2020. When COVID hit, every single innovation that we wanted to make, it was faster for us to deliver it through our iOS app. So we made a ton of new improvements and additions in iOS, leaving a lot of android users annoyed at us because a lot of the new features we were adding weren't available for android. So I think that innovator mindset, I think the rest of this year we're going to be finishing out almost that first year roadmap.Steph:It's crazy to think about it, but finishing out that first year roadmap and bringing all of our featured parody across our platforms. We have to get to that and I think that's that first stage. But, the cool thing about the last year is we've been forced to move so quickly. We actually moved our company towards that agile development cycle. So now I think we have a much more prone, agile methodology for how we launch new technology and that's really exciting for any digital development or product person. Because in my mind that leads us down the path of, "Hey, we can pilot stuff. We can be more agile. We can be faster. We can do one platform at a time." So I think that gives us a lot of room in the future to perhaps add whatever it might be on a small scale before we take it to all three platforms and go big. I think actually this last year forced us into a much faster cycle and development cycle, which is great, because I think for any technology that's basically where you got to get to.Stephanie Postles:Yeah. I mean, it sometimes still feels crazy to me that we have to build for different platforms. I totally get it. I mean I built apps back in the day. But I remember getting the [inaudible] app done and being like, "Ugh, I have to essentially rebuild it so it fits with android devices and all the other ones out there, and different sizes. I don't know why this feels vile to me that we still do this, but it feels archaic. When will there be a place where it's like you build once and it scales?Steph:Yeah, we think about this a lot too because we're like, "This is actually the front door for so many guests," and that's been a new mindset for us too, because I think there was a time where people felt that, "Well you're going to discover Shake Shack through the neighborhood. You're going to walk around and walk through that door. But the digital front door is so much bigger. And so you've got all these platforms and interestingly they're three separate doors. There are reasons for each of them, which is super frustrating from a developer's perspective because it is like doing it three times. But yes, in the moments that we feel like we have to motivate our team, we definitely go back to this digital front door being so much wider and if were able to cast the widest possible net, that we're going to really capture the guests, no matter how they choose to interact with us.Stephanie Postles:Yeah, yeah. And even thinking about adding on then an international layer to devices. I mean, that was something I know we struggle with back at Google of people were not even able to update their device because of data issues. I feel like things like that are taken for granted in the U.S. Of course all my apps just update in the background and I never even have to think about it really anymore. But I mean, in other areas that's a huge thing of, "Oh, well how much data will this take in storage?" And that's a whole other big thing, especially with all these new users coming online. Is this something that you guys are thinking about too?Steph:Well it's a fascinating thing because we licensed Shacks very early at Shake Shack. So, we have a big international presence and we work with a lot of licensed partners who help us develop our digital platforms through those partners. I think one day the holy grail for me will be that you can use the Shack app everywhere, in airports, in stadiums, in Japan. I think that would be incredible. For now, we're not there. We rely on our partners to build these digital tools on their own platforms and whatever is relevant for their market, et cetera. We work really closely with our licensing team though and I think that's been a really fun part of his past year as well, is being able to share with our license partners, hey this is our digital roadmap and what we're building on our side and on our own properties and platforms. In some ways they've tried to mimic that, which is great.Steph:You start to see them adding delivery. You start to see them thinking about different pick up options in their restaurants, et cetera. So, I think that's been real inspiration, but I think that ultimately if I could look 10 years out, I certainly want to be the app that works omnichannel and omnipartner which would be a huge challenge to get to, but would be awesome one day.Stephanie Postles:Yeah, yeah. Are there any trends that you're seeing right now? It can be here or abroad, that are actually surprising to you where you're like, "Oh, that's picking up, or people want it that way." Anything there that's surprising, because I feel like this whole past year too is full of surprises.Steph:Yeah. Ghost kitchens continue to surprise me.Stephanie Postles:What is it?Steph:Yeah, not because I don't see the value. We're actually looking into them and some of our license partners use ghost kitchens to to-Stephanie Postles:Oh, kitchens. I've never heard of those.Steph:... service the different areas. Yeah, so ghost kitchen is basically it could be a food truck. It could be a kitchen or a commercial kitchen. It is not a branded restaurant, there's no seating. But, in London ghost kitchens, for example, are serving Shake Shack to a delivery audience, for example. So, our food is cooked up to our standard and with our ingredients, et cetera, in an unbranded storefront and delivery partners pick it up and it's delivered the guest and the guest never really knows that it didn't come from a Shake Shack restaurant. So that's the ghost kitchen concept. We're certainly looking at it domestically where we might have tons of demand and not able to fulfill it through our restaurants. But the reason I think this concept just totally baffles me is, there are brands now trying to use ghost kitchens as a way to get to 250 restaurants overnight. I think it's such an interesting thing because the question of scale versus brand is one that I think that not everyone's getting right.Steph:So, some of these folks don't really have a brand. They might have an influencer following, or they might have an idea, or they might be a really small restaurant concept. And they're able to get to massive scale, like 250 restaurants nationwide by using ghost kitchens. I think it's really interesting. I still can't figure out this trend, so that was why it was my answer to your question, because I'm looking at it and saying, "How far can this concept push?" It's great from a real estate, not having to build out space, not having to train anybody.Steph:But, how far will the consumer go in buying into that, without the experience, without the physical place that you can go? It's almost like when Amazon told us we don't ever have to go in a store. We're just going to deliver things to you. Brick and mortar retailers were like poo-pooing it a little bit because they're like, "Well, no everybody will want to come to a store." I think there's a happy medium there. So food will go through that too and I think it'll be an interesting evolution of how many concepts can get to scale through ghost kitchens and how many of those will survive?"Stephanie Postles:Yeah, I mean I also wonder how many people are going to get ghosted with that whole idea. I mean I think about all these new companies right now, especially in the e-commerce world popping up really quick, over promising, unable to deliver, and then they're gone. I mean that's just because it's obviously a lot of people are going online right now. It's very easy to do. It's very easy to sell. It's easy to maybe drop ship and white label things. But, I think that of when will there be a point of distrust because someone gets burned like, "Wait this isn't what I thought it was. This isn't the quality."Steph:I think there will be a flight to quality. I think ultimately a lot of those concepts are fun. They can pop up. You might try it once, but as we were talking about at the beginning, how do you get people to come back? People come back for the experience. People come back for food that's really high quality and they can really feel the value of that. I think it's such an interesting thing for me to watch because I think complimented with the right brand and actually done correctly, that could be an incredible way to scale. But it is very much like what happened in e-commerce and what is happening in e-commerce where it's like, "You start to wonder where is the quality control on this and also how often is a guest going to truly buy into that?"Stephanie Postles:Yeah, yeah. I wonder if there's an opportunity for restaurants to merge, turn into fusion restaurants where it's like now we are a Dunkin Donuts and Shake Shack and if you order from this ghost truck, you can have ingredients from both. Because I do find myself, especially on Grubhub where I'm like, "Oh, I kind of want a little Indian food, but then I also want Thai food and this." That maybe partnerships mentality maybe could work. Because then you're actually giving something more, versus the alternative is, "Well, I could just order directly from Shake Shack."Steph:Totally and I think one of the ways we've had a lot of fun experimenting with this is we did just recently do this now serve and collab series. So we bring in a chef. In Atlanta we brought in Pinky Cole from Slutty Vegan. Here in New York we worked with J.P. from Attaboy. It was super fun to bring in really unusual ingredients and put them in a Shake Shack concept. We loved this for testing and getting a sense for, "Hey, is it our guests who's really loving this new ingredient or this type of food in burger form, or is it that we're bringing in new guests and someone who's coming as a huge fan of that chef?"Steph:So what was interesting about all that is in Atlanta we certainly drew massive fans of Pinky Cole and her vegan concept. That certainly has gotten us thinking here in New York when we partnered with J.P. and with Attaboy, we saw a lot of Asian guests coming out. I think it had to do with our philanthropic partnership as well. But, it's just a lot of really interesting stuff for us to think about. Is there a way to continue to expand our menu properly to serve that guest?Stephanie Postles:Yeah, yeah. That's always a challenging thing to think about of not going too far where you get distracted and staying true to the roots, but also not being so stuck that you can't innovate and try new things, and fail fast potentially. But at least get in front of new markets.Steph:Totally and I think we also love it from a community gathering aspect. I think there's always some excitement when you come to a chef collab and I think we've always wanted to go back to our culinary roots and really share that with our guests too. So, our background being founded out of the Union Square Hospitality Group, that culinary thing will always be part of what we do. And it's been a great fun and innovative test and learn environment for our culinary team, and also for our marketing team to say, "Hey, how can you reach new audiences?"Stephanie Postles:Yep, yeah. That's super cool. So where do you want to be in the next three to five years with Shake Shack? What's your North Star? Where you all headed to?Steph:Yeah, I mean I think we want to maintain this amazing digital relationship with our guests. If I look five years out, I think Shake Shack is growing quickly from a footprint perspective, from our digital platforms. So in the next five years, I expect to see our brand in twice as many places and I expect in our digital platforms to be able to capture that full experience. What I mean by that is I think I'm looking at a few things like content infused experience and that frictionless experience, and ultimately that really personal experience coming through our digital platforms. There's a lot of, I could easily look out and see a lot of QSR apps that do an amazing job at just that transactional drive to conversion and complete. But I also know there's a different set of apps that I use that literally just bring me joy. I would love Shake Shack to sit in that latter camp. I would love to create uplifting digital experiences. People use our app because it makes them feel something and also feel satisfied and uplifted the way our food experience is.Steph:I think that's a tall order. I think it would be different if I were just trying to gear our team to mimic the best in class of what's out there. But that's boring and that's not what we want to do. We're super focused on Shake Shack having really differentiated digital platforms, and delivery digital and infusing it into our omnichannel experience. So you will see more screens in our shacks as we find the right way to provide status and provide order notifications and in some cases menu boards in a digital way. We want to continue to evolve our brand toward that direction so we can be more dynamic and be more personal, and be more relevant.Stephanie Postles:Yep, yeah. I love that and then all of that just leads to a better one to one relationship, which I think a lot of brands are going to be struggling with, trying to figure out how to build that up and how to create authentic content that keeps our consumer there in a way that they want to stay there, so they can keep the conversation going and not lose that connection.Steph:Yeah, I think that the one to one marketing, I mean that's the grail right? But even just more personalized content. I think we're starting to segment our guests more consistently. Our CRM capabilities have really improved over the last year and will continue to do so now that we have these 1.8 million guests that we have to really better understand. So we're looking at different capabilities too from an automation perspective and when we think about how to keep people engaged, we really want to make sure we're delivering content that's relevant through all of our channels. And it's funny because you know when you hit it. We did just a fun push message, those really awkward days when we were waiting for election results, right after the 2020 presidential election. I think there was one day that we just decided very Shake Shack and very brand playful. We were saying, "You know what people really need right now is comfort, and nothing says comfort like a cheese fry."Steph:We had some push notification that we designed out for that evening and it really hit. I think we got dozens of tweets of people just sreenshotting this push message. So I think we really have that luxury with our brand tonality and voice that we are allowed to be comforting and playful, and when you hit it, you hit it. So we've really had a couple of those cases and now we're thinking through how do you systematize that? How do you make that more of the everyday?Stephanie Postles:I love that. 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 ask a question and you have a minute or less to answer. Are you ready Steph?Steph:I'm ready.Stephanie Postles:All right, when you want to get into a creative mode, what do you do?Steph:That's such a hard question.Stephanie Postles:I know, that's why it's the lightning round.Steph:Okay, well this is embarrassing. When I need to get into a creative mood, I take a shower.Stephanie Postles:That's great.Steph:There's nothing better than a really great shower and also most working parents know that the shower is the only, the last sacred place that you can avoid your children.Stephanie Postles:I love that and I 1000% agree with that. If you were to have a podcast, what would it be about and who would your first guest be?Steph:I would love to do a podcast about fearless women and their take on society and the world. I'm so lucky that I've been able to befriend a lot of women in this space, hospitality and through all the roles that I've had. My first guest would be Debbie Sue, who is the CEO of OpenTable. She's had an incredible career and happens to be a very good friend of mine.Stephanie Postles:Oh, she sounds awesome. I would for sure listen to that. That sounds great. What's one thing that you don't understand today, that you wish you did?Steph:I wish I understood a bit more about this intersection between consumer psychology and AI. I think there's a lot of AI being used to develop plans around data, et cetera. I would love to get to that AI that's truly intelligent, that understand consumer psychology. I have an Alexa in my house and I think that she's supposed to understand certain things. I don't think she really gets me yet. Ultimately that's a space that I'm super interested in that almost like human's machine connection and will we get there, to where they can be really anticipatory and understand us?Stephanie Postles:Yep, yeah. I feel that all the time. I'm like how could you not understand that? I perfectly said exactly what's in my head and not working for me here. That's a good one. What's on your ideal hamburger?Steph:Oh, well that's easy. My ideal hamburger is a Shack Burger, so Shack Sauce, lettuce, tomato, I add sliced onions, sometimes a pickle, it depends. But that's it, on a potato roll.Stephanie Postles:That sounds good, an now I'm hungry. All right and the last one, what one thing will have the biggest impact on e-commerce in the next year?Steph:I think aside from Amazon, I think the biggest thing that will happen in e-commerce is our ability to deliver those orders. So, one thing we've been seeing for awhile is that last mile is becoming harder and harder to be profitable. There are only a few companies that can still make money and do that last mile. So I love everything I'm seeing on consolidating that last mile. There are companies out there that are really trying to cut down on waste for that last mile and not package everything the way all individually and separately. So, I think e-commerce in the next year and in the future is going to have to really figure out how to do the last mile in a way that is environmentally conscious, consumer friendly, and impactful. And I think that that'll be a big shift that's going to happen.Stephanie Postles:Yes, yeah. That's a big one. Awesome. Well, Steph thanks so much for joining this show. Where can people find out more about you and go to a Shake Shack or download the app? How should they find it?Steph:Yes. Shakeshack.com, @ShakeShack on Instagram and follow us and you never know what might happen. You might get a free burger.Stephanie Postles:Oh, yeah. That's awesome. Yeah, thanks so much. It's been great.Steph:Thank you.
17/06/2150m 35s

Brands + Influencers: A Two-Way Street

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.---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---Transcript:Stephanie:Hey, everyone, and welcome back to Up Next in Commerce, I'm your host Stephanie Postles, CEO at Mission.org. Today on the show, we have Tezza Barton, the CEO of Tezza and the Tezza app. Tezza, welcome.Tezza:Thank you. I'm so excited to be here.Stephanie:I'm excited to have you. I think this interview, I'm just going to be saying your name a bunch of times, should be very interesting. You'll be like, "Stop it."Tezza:It's very confusing, I'm sorry.Stephanie:I like it and I actually think its branding is on point. I want to hear a bit about your background, because I was looking through your social presence and the things that you're doing. You obviously have a very big following, I think on Instagram definitely over a million, right?Tezza:Luckily, yes.Stephanie:You've got a lot of fans, a lot of fans of Tezza. So I wanted to hear about how you got here and what was that journey like.Tezza:Totally. Where to begin? I grew up in Salt Lake City, Utah, so I loved just living in the outdoors, being really close to nature. My entire family is full of just artists and creative people, so that was just always something that I was lucky enough to be in front of and around and welcomed by. I think as I got older, I didn't really realize how special that was and how impactful that would be on my life, and how a lot of other people just were turned away from that. This was a really beautiful experience, both my parents were entrepreneurs and started their own businesses, so that was just like what life was to me.Tezza:So I was super lucky, and I remember when I was 16 I had this just, I was like, "I'm going to be a fashion designer." I really was so obsessed with fashion design and creating and selling all my own looks and things like that. Then I picked up a camera to shoot the looks I was creating and I was like, light bulbs went off, "This is amazing, I can actually capture so much more than just the clothes, but the storytelling and all that stuff." Which really got me excited, and from there it was like an explosion in evolution of just figuring out who I was as an artist and creator. I did go to school for fine art and photography, where I really dug in and learned more about just ... I guess honing in on my skills.Tezza:That was right about when the whole Facebook, Instagram boom came about. So for me, I was blogging since I was 16, I was always on I guess social media in some way trying to create, just to get my work out there. I honestly was using it as a portfolio, a way to get clients, a way to just be seen. I think I was super lucky, I remember feeling like, "Gosh, I don't even have to have a website, as a 16 year old, I can just post it on Facebook and people see it and people want to interact." So that just became the way I worked, and in college, Instagram came out and really my dream was to work with all these amazing brands. So I was like, "How can I help them create content?" No one knew how to create that much content.Tezza:So I would just message local brands and I was like, "How can I be your just main photographer? I'm going to help you create 60 different pictures that all look different that you can have this awesome Instagram feed." So that became my side career while being in college and playing in a band and all of this stuff. So I used that as just a way to build also a following in the community, and people often would talk about my page as like a TV channel. They're like, "This is like a series. I can't wait to get the next series that comes out." So I used it as a professional and just a personal platform, and not necessarily using it as monetizing to work with brands, but more as just a photographer.Tezza:Then I remember I was like, "I'm just going to move to New York." My husband and I were like, "Let's just go, we have no reason to go, but we need to go. I don't even think at that time the word influencer, it wasn't a thing, but that's really where I just saw like, "Oh, wow. I can actually work with these brands. I can get them to hire me as an individual." I really just loved the storytelling, that's what I wanted to focus on, so I leaned in and decided I was going to use this and try and monetize my Instagram, if you will.Tezza:That was the beginning of where we are now. So it's just been an evolution since then, but I can get into I guess, why and how we started the businesses from there. But that's the gist of the story.Stephanie:I love it. So in those early days, how did you convince brands to work with you? I imagine you being in New York and just going to a brand and being like, "I have a great Instagram, I've got some good followers, pay me." What did that process look like and how did you catch the big fish in the early days?Tezza:Totally. I remember, and I still do this to this day, I'm not going to lie, but I remember the first big client I really wanted to get was Urban Outfitters, this was back in the day. I was like, "I just know I can create the kind of content that will not only sell their products, but my audience would just love and be attracted to." So I would basically buy their products and I would create, I would go so hard and create amazing content that I knew they would want to see, and I would email it to them, I would tag them, I would DM them. Finally, after months of doing it, they were like, "Oh, my gosh, yes." Then all of a sudden they were hiring me every single month to create for them.Tezza:So that always has been a part of my strategy, even with high end brands like Michael Kors or whatever. I think just as an individual or creator showing what you can offer a brand, what you can provide and why you'd be a valuable asset to them, whether it's amazing imagery or you can drive sales or you're just the biggest fan in the world of the brand. Those are all tactics that I think brands actually use and look for when hiring creators and influencers.Stephanie:Yeah. I like that, show value up front. So with this much content that you're creating, especially thinking about sending samples of what you can do, what does your creative process look like when coming up with these campaign ideas? You were talking about banging out six feet of photos, that all look different but have a similar theme and really sell the product. What does that story-boarding and creative process look like to be able to come up with something that connects with people and also keeps the brand's image at the forefront?Tezza:Totally. I think, look, I'm somebody that likes to consume products and most of the time it's because an image captures me and I'm like, "I want to look like that. I want to feel like that." So when I'm about to create any kind of content, I take a step back and I'm like, "What story am I telling? Who's this girl? Where is she going? How is she feeling?" Whether it's a personal project or I'm creative directing a campaign for another brand, because I think those can be a little bit different.Tezza:But I think if you can take something, just even a little bit of the extra mile and do a little more storytelling than just standing on a blank wall, which also that can drive sales too ...Stephanie:That can be so vogue. I have no idea, do not ask me.Tezza:That was a great line. It really can. I think there are so many ways, but I think the one thing I notice and the reason I ever started to really even become, have any sort of traction or growth, is because I definitely lean into just the storytelling aspect and making a piece of content that lasted a little bit longer than just that five seconds of scrolling on a feed, but somebody might want to repost it, somebody might want to recreate a picture like that because it made them feel something. It lives on Pinterest, that's how I focus and think about my content.Stephanie:Were you also focused on distribution? You can make these great pieces of content, but how did you get it in front of the people that they wanted to? Was it just focused on your following, or were you trying to find new ways? Like Pinterest, maybe you weren't there before, you're like, "I'm going to go here, I'm going to try YouTube." What did that look like to really get that content out into the world in a way that could potentially go viral or scale?Tezza:Totally. I think if you can be on as many platforms as possible, you should. It's definitely difficult, I even struggle with it myself, but I use my blog and Pinterest were a huge, huge way of existing and growing my audience outside of just Instagram. Because so many people would be like, "Wow, I discovered you on Pinterest. I didn't know that was your photo, I've been seeing your blog over here." So I think having the conversation, TikTok is an amazing way now, YouTube is an amazing way now. On top of that, I think another amazing thing you can do is collaborate with other creators and influencers. That is huge for just combining audiences and being able to share each other's audiences and messages and build your own brand.Stephanie:Yeah, yeah. I love that. So when thinking about these big brands partnering with you, I always ask the brands, "How do you think about ROI with influencers? Do you think it's worth it? How do you find an influencer is good for your brand?" What's nice about this conversation is it's on the other side of the table. So I want to ask you, how do you think about working with a brand, what's a good partnership look like and how would you advise them on thinking about is this going to be a good fit, will you get the ROI that you want?Tezza:Right. I think ROI, that's always the hot topic, the hot conversation, but there are so many different ways to think about using an influencer. It's like when Doritos does a commercial on the Superbowl, obviously there are so many things that does. Vibe, culture, conversation, visual, you don't know how many people are going to go buy Doritos after you watched that commercial. But I think the benefits of using an influencer is that you're hitting personal, usually an influencer's community is pretty personal, they've stuck around for hopefully many years, they trust that person.Tezza:So I think you're hitting those trust points, and I think personally the most success and the best success in conversations I've had with brands as an influencer is when, even if I'm the biggest fan of a brand and they just send me an email and they're like, "We just want you to post, here's how much it's going to be, here's the brief, done." I'm like, "Okay, cool." But if a brand sits down with me or has a phone call and they're like, "This is why I love my brand and this is why I think you're going to be a good fit, and this is why I'm passionate about this project and this new thing that we're launching." I'm so hyped, I feel so much more connected to that brand, I'm going to spend 10 more hours on that piece of content than I am if it's just too quick and there's no heart in it.Tezza:So I think just as a brand, if you can find influencers that not only love your product and want to talk about it, but actually connecting with that person, that partnership is going to ... It will just go longer and they'll talk about you even more after than when you just pay them, because they're excited about it too.Stephanie:Yeah. I love that. That's such a good idea. How do you pull in whoever you're working with so that they have heart in it? It's not always just about the contract and the hours, all that. People will probably go the extra mile if they've personally committed to it. I know when I was talking to someone from Anheuser-Busch on this show and they were talking about a partnership with Travis Scott and they were like, "He's not just an influencer, he's shaping the product. He's shaping the creative and he has a very vested interest in this entire campaign. It's not just him posting once on Instagram and then walking away." It's a whole thing, and that to me is what you want. I don't know if enough brands think of it that way and think of the longer term benefit and have actually pulled in the people that you're trying to help spread the word in a way that's meaningful to them.Tezza:Totally. I think another example of that, and this is a brand that I've worked with for many, many years and we built just honestly the trust, kind of to what you're saying, I think it's actually using an influencer as a creative and a creative director. I worked with TRESemme for so long and my content always performed really well, they loved the direction I took things, the amount of time I spent on things, and so after a few years, they started to hire me as a creative director and photographer for the brand and I got to shoot other influencers for their campaign. That became a bigger part of the story, they helped tell that story.Tezza:So I think, think outside the box. Use these creative people to your advantage, because we're sitting here. That's more exciting than just a quick post, and I think everyone's just craving just personal touchpoints right now, so anything you can do like that is going to be just a level up from just a post.Stephanie:Yeah. What did that look like behind the scenes with TRESemme when you were acting as a creative director and you were behind the camera, instead of making your own posts for them? What did that look like?Tezza:So much fun, not going to lie. It was a blast.Stephanie:Sounds fun.Tezza:Yeah. I think we had six different girls and I got to help choose the influencers and really come up with different imagery that would bring to life not only the TRESemme content, but the influencers' content. So I think because it was coming from also the influencer side and not just the brand side, there was so much more value in thinking about it that way and really trying to bring to life two different brands. Influencers basically have their own brands, so I think finding that storytelling is really where beautiful things start to happen.Stephanie:Yeah, yeah. Very cool. Which brands to wish to work with in the future? Are you hoping to one day partner with?Tezza:Oh, gosh. Way too many, so many brands.Stephanie:We've got to put it out there so the universe answers your question.Tezza:Yes. No, totally. I think personally, I would love to work with ... I did a small campaign a couple years ago with Canon and I'm a Canon fanatic. I love cameras obviously and I used their products for years. So when I got that campaign and I got to use a new camera coming out and I got to create content that was going to be in a photo gallery and all this stuff, it was such like, "Wow, this is my dream collaboration." So I think working with not only just camera brands that I love, I would love to work with Fuji or anything like that, but also working with just artists.Tezza:I would love to work with, I don't know, like a musician. I think it would be so fun to be like, "Okay, I'm going to come up with your next music video and Instagram strategy and let's get into it and get creative." I just love that kind of stuff, so anything like that would be a dream. But real, real talk, my dream would be like Gucci, okay?Stephanie:All right, it's out there.Tezza:It's out there.Stephanie:... Will be next, now you've put it out into the universe.Tezza:Yes.Stephanie:Let's jump over to Tezza now, I want to hear about your company, I think it's super interesting hearing how you built up this following, you have a lot of people who like your work, they love your creative direction. Then you go and you create an ecommerce shop and then you create an app and I want to hear what was that process like going from building a community and focusing on that to them being like, "And now I'm going to build a full-on ecommerce business and app."Tezza:Totally, yes. So many mistakes, I'm like, "How do I even get into the beginning of it?" I think for me, I wasn't setting out to be an influencer or just even an entrepreneur, but I always just loved ... I had this motto, which was the art of life, that was like, "This is my goal in life." Because I grew up in this family of creatives and people that always were supporting my art and helping me fuel my art, I felt like, "Gosh, not everyone has this opportunity and I want to do that for other people."Tezza:So I want to inspire everyone to find their inner artist, because I feel like everyone is creative, everyone has the ability to create art, but they don't always know that. So that was like my mission, and so then everything that came after that was to support that idea. I was fortunate that every product we've started has been from actual interesting questions that we were getting, it wasn't like I was like, "I have this random idea and I want to make a thing, so let's just figure it out." For example, our first product we ever launched was our collage kitsTezza:That idea, when we started, it was not there, it didn't exist. But so many people, we had so many images on our walls and they were like, "How did you do this? Where do you get these cool pictures?" I was like, "Wow. I take all these pictures, I could create this kit." So that was my first physical product ever and wow, we had no idea what we were doing. We just called a printing shop in Wisconsin, we were just trying to figure it out, we did it all out of our studio apartment in New York. The interest was there, when we announced what we were launching, people were like, "Oh, my gosh. This is genius."Tezza:I was like, "Yes, we're going to make a lot of money. This is going to be amazing." Then we put it up on the site and we got like two sales. We were like, "Okay, so this is a horrible idea." It really was a lesson that just taught me so much that I implemented ... It was just like, "Wow, you do have to talk about something so many times." It doesn't matter, even if you're an influencer, even if the interest is there, you just have to talk about it. You have to get it into the right hands. You have to constantly be presenting the idea. Especially now, I think we're inundated with so ... We're seeing so many products all the time, so how are you making it personal? How are you telling the story? What is the product? Why does somebody want it? Why is it going to benefit their life?Tezza:So that really, after doing it for two years in our apartment and making all those mistakes, we finally found crazy success with that, after grinding away at two years.Stephanie:What did you do? How did you go from having two sales and you're like, "Wah-wah," to then finding success with it? Because I can tell now just by looking at them like, "There's no way you're not selling a bunch of these." Collages are so on trend right now, everyone is trying to collage walls with the pictures and then trying to organize it. I tried to do it, it literally took me a week and I was this close to giving up. So what did you do to hit success with that?Tezza:I think like I was saying, just talking about it way more than we thought we had to. I didn't know how it worked, I never have run ... I didn't know you should be doing email campaigns or I should be ... That every person that is interested in DM-ing, I need to be DM-ing back. Really supporting the community of it and helping people, just making it an easier part of conversation, and then also just getting it into the right hands and having those people love it so much that they want to talk about it, that's always been influencer marketing.Tezza:An influencer, I say that, I think everybody's an influencer. You could have 10 followers, and heck, you might be influencing those 10 people major. So all of a sudden [inaudible], but I think how can you have those organic conversations and find people that are actually interested? The second we did, it circulated and circulated, and circulated, and we never really had to ... We don't overthink it now, but I think that was a really interesting learning process. On the flip side of that, we launched the app, it's been I guess a little over two and a half years now, so two and a half years ago, and that was a similar product where we launched that out of just interest.Tezza:I was a photographer, I really had a super specific aesthetic and so many people were like, "How can I do this? How can I be a better photographer?" So I was like, "I want to be able to help everybody do this. How can I?" I could sell my lightroom presets, which I was doing, and I had great success with that, but it was so limited to people that I could reach and I was super lucky that my husband was a developer. So we were like, "Let's just sit down and see if we can build an app." We were two kids in a studio apartment, who knows what we were doing? But after a year and a half at midnight grinding away trying to figure out how to build a photo and video editing app, we finally got it up to work and it was so raw at the beginning.Tezza:I remember when we launched, it had so many problems. It's such a different product than an actual physical good, but equally you have bugs and you have just a million types of phones that it has to work on and all of these things. So it was a very humbling process, but I think we've benefited, because we knew who our consumers were and what they wanted and I had built such an honest and real relationship with that initial community that wanted the app, and so they were willing to work with me and we worked through the bugs, and that's still how the app works today and we were really able to grow it because of those initial core people that just wanted it and thought it was amazing and were willing to get through the mistakes with us.Stephanie:Yeah, yeah. That's nice and it's good to have a community that is willing to chip in like that.Tezza:Yeah.Stephanie:You get the Tezza app, which is a photography editing app, and you've got Tezza which is an ecommerce shop, how do you think about uniting both of those and sending traffic both ways potentially, or not at all? Do you keep them as complete separate companies and use cases? How do you view the branding on everything you're doing?Tezza:Totally. Just to be honest with you, it's been I feel like a quick five years where I'm like, "Wow, we just did so much." We didn't have time to think, we were just building and doing stuff that we wanted to make. All of a sudden, last year was a very important year for us and in a way grateful for everything slowing down, because we were able to take a step back and be like, "Okay, what are the brands that we're building and how do they work?" So now, we are really passionate and excited about combining those two brands together and really focusing on having art in the physical and digital space, and really just helping and inspiring creators, whether it's making your home a more inviting amazing space, or you're able to create really amazing artwork and be an amazing creator by using the app.Tezza:Then on top of that, we're doing so many different collaborations this year, once again in the physical and digital space, by working with other artists and bringing to life their work through art prints and things like that, and then also within the app. So it's a really exciting year, I feel like we're finally understanding the brand that we're building and I now finally see where we're headed. So that's an honest answer, I think we're still growing and figuring it out and we're such a small team, it's me and my husband and our assistant. So we're growing, we're trying to get bigger and better, but it's been a good year for sure.Stephanie:Well, that's impressive how much you all are doing with just the three of you. Yeah. That's a lot of work. What are you thinking about the NFT trend right now, especially hearing about how you're doing digital art? I'm just imagining, are you going to put it into an NFT, put it on the blockchain, do something like that? Sell it that way? Is that something that you guys have even talked about? Because it seems like you have a good opportunity, especially since you're one of the creators who is making some of this amazing art. People are willing to buy your collages with just your photos. Have you thought about creating scarcity around that potentially and having it in a digital format that people can own?Tezza:Totally. I think it's a hot topic right now and something that we're dipping our toes in and actually trying to figure out an interesting way to go about it. I'm not exactly sure if that will evolve to be the way, I think we're going to see a lot of different things pop up like that. So I don't know. Honestly, I feel like a newb, is that, I don't even know, a word to use on that space?Stephanie:Yeah.Tezza:But I think I am excited to see stuff like that, I think there's a lot of value. I like the idea that an artist can get, as a piece of art goes on and on and gets passed on, an artist actually would still get the commission from something like that. I think that's a beautiful thing and I think it's similar to music. I think music is going to change and evolve a lot over the next little bit, and so I'm excited to see where it's all going. I think all these worlds are about to come crashing together.Stephanie:Yeah. I was just going to bring up music, because I know you were in that world for a bit, to me it just seems like a no-brainer. Why wouldn't you put your music somewhere that can get properly valued and bought and respected in a way that it hasn't been previous? I just so many use cases where I do feel like there was obviously a very big fad, it got a little crazy, you can't just be like, "NFT solves the world's problems, it just needs to do everything and I'm going to put my pen on it, I'm going to digitize this." It's definitely gotten a little out of hand, but I can see a place where there are really good use cases around ownership and giving artists what they deserve, which is really cool.Tezza:Totally. I think just more artists are becoming independent, even with TikTok, the things that has done for small musicians that could never get the viral reach or anything without a label or all these people behind them, I think there's so many cool ways that are coming up and Instagram alone I think has been just an amazing place for independence and artists to be able to sell their art or find a community. I think about the people I've connected with. My favorite thing to say is just, because it blows my mind, because it still happens to me all the time, is like you're one DM away from a CEO of something amazing that you're super interested in.Tezza:So if there's a brand, a person, a musician, whatever it is that you are like, "I just have a question." Probably just send it, because you might get a response and it might be from the actual person that you want to get in touch with. So I feel like there's so many quick touchpoints that are coming more and more accessible. I think we're in an exciting time. I know it's also like there's a lot of negative things people could say about it, but I think that's the positive side of it.Stephanie:Yeah. I like to focus on the positive side as well. I love that, you're one DM away from whatever you want. How do you think about collaborations? I know earlier you were talking about collaborations with brands, it seems like that could also get tricky and a little sticky, depending on who you're working with. So how do you view having a collaboration and a brand that's going to work well and not get to a place where you're both rubbing heads and trying to figure out who is doing what, what's a good collaboration?Tezza:Right. I think we touched on this earlier a little bit, but actually having just a real conversation about the goals of not only just the brand, but as an influencer, what works and what performs well for you. So having that laid out almost before you get into what the collaboration's going to be about is important. Then when a brand sends me a brief it's like, "You have to say these exact 45 things." So this is an infomercial and even if I love the product, my community is going to swipe away. So I think really as a brand, if you can try, I know it's hard because trust me I run a brand too and sometimes you're like, "But we need to hit these talking points," which I understand, but just taking that extra step and making sure it is coming from a personal place and voice is the special sauce.Stephanie:Yeah. I agree. What kind of platforms are you most excited about right now? What are you dipping your toes in that maybe other people aren't even thinking a bout exploring? Or where are you seeing a bigger following than you even would have expected happening quicker than maybe other platforms? What are you bullish on right now?Tezza:I know everyone's saying TikTok, but it really is like the early days of Instagram where there still is that discoverability. I don't think it's going to last too much longer, so that's why if anyone isn't dipping their toes in that, I would say just jump in for a year and try everything. Don't try what you're seeing, just try something new and different. I think people are craving just something that's super different, so that's one area.Tezza:I think also, this is a vaguer area, but this is where I find a lot of success in the platform is more like combining, collaborating with other artists. So I think everybody has such a strong community these days, whether it's a brand, an influencer, an artist, whatever it is, so how can you marry those two, that relationship to really actually combine your followers or your community and the ideas that you share as brands? I think that's almost what I'm excited about in just commerce in general, because we're doing this on a personal level and with brands and things like that, but I think massive, massive brands are doing that. Street style brands are doing it with random cool artists that live in LA that want to be discovered, and I think that brings so much more heart, like I said, into everything that you're doing. So I think that's almost like a new, not platform, but way of collaborating and trying to grow, if that makes sense.Stephanie:Yeah. Yeah, that completely does. I love that. All right, well let's jump over to the lightning round. Lightning round is brought to you by Salesforce Commerce Cloud. This is where I ask a question and you have a minute or less to answer. Are you ready?Tezza:Oh, boy. I'm nervous, okay.Stephanie:You'll do great. All right, first one. What's up next on your reading list?Tezza:The Adventures of Calvin and Clay, is that what it's called? Wait, Kavalier and Clay. The Amazing Adventures of Kavalier and Clay. I don't know, but my husband's read it like four times and he's like, "It's just beautiful, it takes you into this world." It's on my list just because I hear him talk about it so much.Stephanie:Wow. It's like 1900 almost five-star ratings on Amazon. It looks like a comic book, but I would be down with that.Tezza:It's an escape, not necessarily, I'm not going to learn, it's not a business book.Stephanie:All right. Hey, if it's good enough for someone to read a couple times, I'm down. That's cool. So when you want to get into your creative head space, what do you do to do that?Tezza:I love to watch old movies or look at vintage magazines. I get inspired by old things. I think we can feel ... I get overwhelmed almost by how much new stuff is going on, but sometimes I like to look back and be inspired by things that were done before and see where new inspirations have come from. So I just love old movies and books and magazines and things like that.Stephanie:Yeah, me too. I think it's always a good fun way to get brought back to where things were and then incorporate that into certain things that maybe people forgot about, which is always a fun feeling. If you were to have a podcast, what would it be about and who would be your first guest?Tezza:Great question. I think it would be about art and I've always wanted to have a podcast called either the art of life or starving artists or something like that to break down the walls of just what being an artist actually is and showcasing just ... My husband, for example, he's a developer, I always made fun of him for not being the creative one, but he's so creative and developing is creative. I was being a critic, I was judging him and now I take it back. So I feel like there's so many things like that, that I would love to talk about and so many cool people I'd love to interview.Tezza:But my first guest? This is going to be so lame and cheesy, but I would love for it to be my mom, because she's the most fascinating woman. I haven't even sat down and asked her all the questions I want to ask her about. She has five kids, she started an amazing interior design business from the second I was born, and never seems to be stressed out or not have enough time for everybody. I don't understand. She's just on another level. So I would love to interview her first.Stephanie:That's a good one. I would listen to that one as well, so let me know when that's up.Tezza:We'll see, stay tuned.Stephanie:Stay tuned, everyone. Who is your either favorite artist you're watching or fellow influencer?Tezza:I'm going to say this for people that are out there looking to become influencers, because I think she is doing a really great job at growing platforms, which is really hard to do right now, so I look up to her for this. But Brittany Xavier, she is an amazing influencer and I've just watched her change her brand over the years, and really go after the brands she wants to work with and also grown literally everything from TikTok to YouTube to millions of followers in short periods of time. She just does such a focused approach, and I think for somebody that's trying to become an influencer or wanting to really grow and find the community, she's just an interesting person to observe.Stephanie:That's a good one. All right, what is one thing you don't understand today that you wish you did?Tezza:How to scale a business. I feel like, I wish I went to business school sometimes. But sometimes there's benefit and I know.Stephanie:You're in it right now.Tezza:I know. I'm in the business school, but sometimes I'm just like, "Wow. I don't even know what to do, where to go." But it's fun, I don't know, figuring it out.Stephanie:You will learn so much more by just doing. Well, if I have to circle back in like a year and you'll be like, "Look at all the progress, look what's happened."Tezza:Exactly, exactly. Can't wait for that day.Stephanie:All right, then the last question, what one thing will have the biggest impact on ecommerce in the next year?Tezza:I think we're in a time where everybody has to take a step back and look at what they're doing, what they're giving as a brand, whether that's anything from sustainability to actually being of importance. So I think, though we're having these massive brands like Amazon and Walmart who run so much of ecommerce, I think there are going to be so many small brands that are coming up that have so much more meaning and thought behind them. I think we're just barely tapping into this new generation of young YouTubers that have insane amount of impact and following and community that I don't even understand. So I think they're going to be leaders in ecommerce and products and I'm just excited and curious to see where that goes.Stephanie:Yeah. Awesome. All right, Tezza, it's been really fun having you on the show. Where can people find out more about you and all the cool things that you're working on?Tezza:Thanks so much for having me. Yes, you can go to ShopTezza.com or LelloTheLabel.com, that's my sunglasses brand. Then also in the App Store, if you type in Tezza you will find our photo and video editing app, and on Instagram, Tezza, T-E-Z-Z-A.Stephanie:Good handle. All right, well thanks so much.Tezza:Thanks for having me.
15/06/2138m 22s

Reimagining Retail

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.---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---Transcript:Stephanie:Hey there and welcome back to Up Next in Commerce, your number one show for all things commerce. This is your host, Stephanie Postles, CEO at mission.org.Stephanie:Today on the show, I have the pleasure of chatting with KS, who's the VP of Engineering for Sensormatic Solutions, part of Johnson Controls. KS, welcome.KS:Nice to meet you, Stephanie. How are you?Stephanie:Good. How are you?KS:Good.Stephanie:I'm really excited to have you on the show. I was looking through our doc and I'm like, "There's so much stuff that I want to talk to," because I haven't had too many people on the show, with a focus on retail, so let's dive right in. I want to hear, what is Sensormatic Solutions and what does your role look like, there?KS:Yeah. Sensormatic Solutions is a technology company serving retailers globally. We provide IoT technology for retailers. Right from the edge to the cloud, we have several solutions focused on retailers, on the loss prevention side. How to prevent theft in the store, and the inventory intelligence focused on inventory accuracy. Then shopper insights which is focused on what is the foot traffic and how are we converting the foot traffic?KS:The top of all those things, we recently launched a new retail platform called Sensormatic IQ. It's a connected intelligent operating platform that unifies several systems that we put out for retailers. In addition to that, it helps you to connect third-party systems as well as retailer systems.KS:That's the digital journey that Sensormatic has done, and that's what Sensormatic does for global retailers. My role is for product development. A lot of technology transformation within the company has been driven by me.Stephanie:Over these past couple of years, what does the transformation look like? Especially when it comes to retailers, now probably welcoming technology into their locations, where maybe a couple of years ago they're like, "Oh, do I even need this? You really have to convince me," where I feel like, now they have to transform really quickly. Stay up with all these new E-commerce brands. Figure out how to get access to the same kind of data that these B2C companies can get instantly. What does that transformation look like?KS:Yeah, if you really look at the retail industry per se, it's the most digitally disrupted industry, right? There are lot of digital transformation that was happening in retail, much before the pandemic actually. Almost every retailer was looking at digital transformation.KS:The primary reason is, more and more online sales happen. When you look at brick and mortar stores, how do you stay relevant in the brick and mortar space? Because of that there was digital transformation that was ongoing with most of the retailers.KS:The pandemic, what it has done is it has accelerated the digital transformation. Now if you really look at, because of the pandemic, you see more need for unified commerce and more need for self-checkout. They like to see that the store is more healthy and safe. Those kind of needs are driving now. Sensormatic as a company, we have operated for over 50 years and we have a very rich heritage of delivering innovative solutions to solve a retailer's best business problems.KS:Even now, as we are going through the pandemic, we are working on new, innovative solutions, right from sensors to systems to software and AI-based offerings. Looking at, how do we help the retailers handle that disruption that has cast in the industry, and come up with new offerings so that they can proceed with their digital transformation journey?KS:If you really look at shoppers today, what the pandemic has done is, most of the people who have never shopped online, they're forced to shop online. Now, once you start shopping online, you get used to shopping online.KS:Now when you start shopping online, now that is one thing, where the online shopping has increased. Second thing is, when you start shopping online, what you realize is, you may be loyal to your particular brand. Now suddenly you have many more choices. Because you're not going into the particular store and you're shopping online, you have many more choices.KS:Now people want to experiment. Because they want to experiment and it is easy for them to experiment, there is a shift in loyalty that's happening, actually. That's causing troubles for some of the retailers, when people want to shift from their brand to another brand.KS:The other trend that you see among the shoppers is, no longer, shoppers want to really come to store and then only shop. They expect retailers to meet, wherever they want to shop, however they want to shop. Whatever time they want to shop, you need to meet them at their convenience, and not a shopper coming into the store and making.KS:Some of these trends, what happens is, for you to address some of these trends, then every retailer needs to adopt technology at a faster pace. If you have to shop anywhere you want and then, any time you want and then, any place you want. Then you want that item to be delivered to you, or you wanted to come and pick it up from the store, we call it as buy online and pick in store.KS:If you have to enable that, the retailers need to embrace the technology. If they don't have the technology embraced then they cannot deliver that kind of a customer experience. When you don't deliver the customer experience, then the shoppers are going to shift loyalty and go to whichever retailer who can provide that experience.Stephanie:How do you make sure retailers aren't, maybe scrambling to keep up, because I'm thinking, a lot of times if a brand or a big company's lacking or falling behind, and then they start just grasping for everything. "Whatever technology's out there, I'm just going to do it all."Stephanie:Often times, maybe some of those are just fads. How do you guide retailers on, "This is something you're going to need for the next 10 years. This is the way of the future versus this, maybe you don't need virtual reality for everything right now. Maybe that's a fad and it's only for certain brands"? How do you guide them around what's important?KS:Yeah. Actually you can divide it into two parts. One is on the shopper's side, if you really look at it. If I'm a shopper and I want to shop anywhere and everywhere I want, now increasingly, you see that retailers are adopting a messaging app-based shop.KS:If I'm on the Snapchat and messaging to you, by the way, on the side, I'll be able to shop. Even on the messaging app-based shopping, there are one of the retailers, Levi's who recently launched a Bitmojis. All the emojis, they call it as Bitmojis.KS:They dress up the Bitmojis based on the Levi's collection. As you are in the messaging app, you can pick something and then shop. That's on the shopping side where they're looking at, "How do I leverage technology to go shop?"KS:When it comes to back end, once I shop, then whatever item I shop, and if I say that I'm going to come to this store near my home and pick it up from that store, that item should be there in that store. You don't want to have your inventory accuracy. If you don't have all the right information correctly available, the shopper, when he or she comes to the store, they're not going to find the item.KS:We call this as a precision retail. Sensormatic side, having all the technology that will enable the shopper to get the best experience when they go do the shopping, either in online. If they can do the shopping online, and come to the store and pick it up, or you go to the store and order it, and it gets delivered to the home.KS:The retailers need inventory information, accurately for them to deliver the best experience for the shopper. The technology that enables that, we call it as precision retail, because if you don't have very precise information in the retail operations today, you'll not be able to enable a better customer experience.Stephanie:What are some of the things that you think are pretty basic, that all retailers should have? Inventory management seems like a no-brainer. Also, seems like something a lot of retail locations struggle with. What are some of the other things that's, you need to have these five things to succeed?KS:Yeah. I would say that, definitely accurate inventory is a must. You cannot survive without having accurate inventory. Also, a easier way of meeting the customer wherever they are. If you have to meet the customer wherever we are, you need to provide multiple channels for me to shop with you.KS:I should be able to shop from my mobile app, or I should be able to shop from my desktop, or I should be able to come to the store and shop. I should be able to experience. If it is an experiential items, people would like to come to the store, have a very good experience of the item, then make the purchase process easy. Some of those technologies will become important.KS:The next one would be self-checkout and mobile checkout. It has become more prominent now because customers do not want to touch, they do not want to interact with the people. They would like to come in, look at the item, and then purchase and have a frictionless checkout. Frictionless checkout becomes an important technology implementation for retailers to learn.KS:If you take it little bit as part of an experiential store, you need the higher technology in terms of, you need to have much better bandwidth in the store, for you to have a good, digital experience. 5G technology will play a bigger role.KS:Also, experiential stores will have to provide more appropriate content and more appropriate digital experience and digital engagement in the stores. Digital engagement technology is going to be more important.KS:I forgot to touch upon, when I said inventory accuracy, you cannot get to a better inventory accuracy without having an RFID-based solution, at least in apparel retail and some of the other retail categories as well. RFID plays a important role in getting to a higher level of inventory accuracy. RFID technology will play a big role.KS:If you go further, there are going to be other technologies in the supply chain, and back of the store operations. You'll see that robots are playing a role. Not every store and not every category of the retailer will be able to leverage, but there are certain categories, robots will play a bigger role.KS:Then the technology that will enable ease of last mile delivery and then confirmation to the customer. For customer who are ordering online, they're getting delivered with one stroke. Again, that becomes very important.Stephanie:Awesome. What are some of the things that hold retailers back from doing this, because I know when I was talking with Joe from Intel, he was saying, "RFID can solve a lot of problems. Also, retailers, it's hard to get them to do that. There's so many solutions all around, but it's hard to get them to actually implement the technologies, to track the inventory, to track traffic, whatever it may be." What's the pushback?KS:Yeah. I would not call it as a pushback. I would say that most of the retailers, if you're a brick and mortar stored-based retail, and today, you have lot of business processes, well-defined in the store. How do you operate?KS:Now when you implement a RFID-based technology for getting a better inventory accuracy and better tracking of merchandise movement in the supply chain as well, now they need to change a whole lot of business processes on the retail side.KS:When they have to change business process, that means it's a change management in the organization. They need to manage that change more carefully and they need to retrain their employees with the new changed approach on how they are operate.KS:All those things takes lot of effort, and it costs money to get the employees trained as well as, and it also takes time to implement the technology. They need more tech-savvy associates also, in the store. All those things will require effort and money.KS:Whichever retailer has gone forward, and we make life easier for many of the retailers who wants to pursue RFID-based inventory implementation. I would say that you got a retail industry experts in our organization who can help the retailers to navigate this process very less painfully. Then we can help in, how do you transform the business process? How do you go about implementing it? What are the best ways to do it?KS:We bring in lot of best practices in the industry, to help with the retailer, and that's how we solve. We do have many customers whom we have really helped go through this transformation, and then migrated them to RFID-based inventory.Stephanie:What are you most excited about? When it comes to all the things you just listed, what are you really passionate about, that when you talk to a retailer you're like, "This is the way forward"? What excites you most?KS:Yeah. I would say that, it's really, look at AI technology today, it has disrupted every industry, not just the retail. I'm really fascinated about how it is getting adopted within retail.KS:If you really look at it, in the past, almost all the retail stores, retailers have implemented loss prevention security cameras. These are IP cameras for security surveillance. That's what it was used for.KS:Now suddenly with the advancement of AI technology, now you can leverage the existing IP cameras in the store, and then put in ... They call it as a Smart Hub. We partnered with Intel and developed an AI edge IoT box, an appliance. We call it as Smart Hub. That box, you put it in the store, connect all the camera streams to that store. Now suddenly the store becomes the most intelligent store.KS:You can do whole lot of use cases and whole lot of pain points which you can solve for the retailer. For example, given the pandemic time, we looked at, during the pandemic we partnered with Intel. We have been partnering with Intel for almost two years, and we accelerated this development with Intel and started developing occupancy tracking solution.KS:People wanted to have reduced number of shoppers in the store. They wanted to have mask compliance. People should be wearing mask. Then all of the shoppers should be maintaining social distance. All these things are new mandates, and the retailers wanted to maintain the health and safety of the store.KS:We quickly accelerated our AI partnership with Intel and developed this occupancy, social distance and mask detection solution in that while. Not only that, now that we have our Smart Hub, the Intel-powered Smart Hub, that Smart Hub enables you to develop lot more use cases.KS:Now if you are a loyal shopper to the retailer, and if you've opted in and if you're a loyal customer for that retail store, now since you've opted in, the moment you enter the store, I know that, "Hey, Stephanie is walking into the store. She is the most VIP customer. I need to handle her better. I need to address her needs better."KS:We can go and alert an associate to go address to Stephanie because she's a VIP customer. That's one option, one example, I'm saying. This opens up lot more newer use cases and newer ways of engaging the shoppers in the store, just leveraging the existing security cameras.KS:If you really look at other AI technology, all these stores have whole lot of sensors, and these sensors generate data. We put whole lot of sensors from Sensormatic. We generate lot of data. We generate data from inventory. We generate data about strength. We generate data about foot traffic, plus we have lot of camera-based, vision-based data.KS:Now, combining all this data, again we can apply artificial intelligence on the top, machine learning models on the top and deliver very, very prescriptive insights to the retailer. That's the direction we are headed now.Stephanie:I'm imagining a dashboard where you plug in a lot of your cameras. You're getting these insights. What would that dashboard look like for a retail worker who could just go up and look. It's like, "Okay, you need to close the door. You're at capacity, or you need to go and restock this one thing right now"? What does that look like, behind the scenes?KS:Yeah. Actually, take the example of an occupancy. If the retailer can specify, what are the allowed occupancy you want to permit in the store, and then configure that in the system. Then the cameras of the entry and the exit can keep counting how many people are walking in. We can also put a display at the entrance. It can show a red or a green indication.KS:Green means, the shopper can go in, and the red means, shopper cannot enter until it turns green. That's a simple indication. What happens is, there's whole lot of dashboard. Once you have all these data, you can create a whole lot of dashboard and provide.KS:More and more if we look at retail, they don't have enough resources to take care of the store efficiently. The pandemic has put lot more demand on their associates, to do more work, because they need to ensure the health and safety. They need to take care of several other things in addition to their job, which they used to do before.KS:Now nobody has so much time to look at dashboard and come to a decision. We saw this need, much ahead and that's where we have put together a strategy and executed our strategy to launch the Sensormatic IQ platform.KS:Now what happens is, as part of our platform journey we can take all this data. We can apply artificial intelligence, machine learning models and predict what is going to happen. Then once you predict what's going to happen, then we can prescribe an action. That prescriptive action, we can deliver it in the retailer's handheld device or any form, where we can push it to the device saying that, "Hey, now your back door is open, or your fire entrance is locked," or something like that.KS:If you see that in this particular hour ... Let's say I have the historical data of this street. From the historical data I can tell you that in this particular hour, there is a possible organized retail crime can come and hit this store at this point in time.KS:I can send an alert to this retail as a protection manager saying that, "Hey, you're likely to get hit with an ORC crime today. You may want to take a preventive action, and these are the possible preventive actions you can take." You can prescribe exactly, where the retailers need not look at the dashboard and deduce that information and come to that conclusion.Stephanie:Well, that's good. It seems like it would be so difficult to come up with prescriptive outcomes for retailers. I'm thinking about these models that you built in the background, and you've got one that has seasonality. You have another one's being hit by the pandemic in a bad way. The other one's in a good way.Stephanie:How do you think about training these models in the back end, so it works for everyone and gives outcomes that's not just being trained on false data that's, maybe a little blip?KS:It's a very good question actually. Now what happens is, there can't be two differences. Not every retailer will have the same model. The nature of AI itself is like that. You need to retrain the model based on the context.KS:It's not a long time. You take two to three weeks of training in that environment. Collect data and retrain the model for that outlet. That is one. That's bound to happen, when you deploy it. The other thing is, other interesting thing you'll see is, take the example saying that, for retailer A, I say that, "This particular hour, you're likely to get a ORC, crime event happening."KS:Retailer A and retailer B, both are likely to get hit with an ORC at a particular time, but retailer A might respond to that differently. They may want to respond to that differently, whereas retailer B might be want to respond to the same prediction differently.KS:One might say, "Hey, I want to shut down that entrance for an hour." I'm just telling hypothetically. Another might say, "I want to push all the high-value items that are closer to that entrance, to the back of the store." You can take two different actions for the same prediction.KS:That's why any prescriptive action we work on, we need to work closely with a retailer to understand what is their context. For that context, how do you have to respond, and then put that prescription into the implementation for them. It has to be a joint coworking with a customer to make it happen, actually. To make it successful.Stephanie:Yeah. Yeah. It seems like every retailer needs an in-house data scientist who can plug in a few inputs of, "Okay, we're running a local ad campaign this week. It's going to be very different. There's a parade coming on by. Everyone's going to want my Matcha tea."Stephanie:Being able to add their own little inputs that, maybe a model cannot pick up on. You always need human input into any kind of model.KS:Yeah. That's true.Stephanie:Yeah, but the training part seems tricky, when it comes to thinking about, how do you implement retail workers and make sure they're thinking in this data-oriented way? How do you train them? Seems like a hard problem for retailers.KS:Correct. That is where technology companies like ours can play a major role, I would say, that you have to take the complexity out of the retailer. Try to understand the context and then make it easier for them to embrace some of these new technology solutions. That's where we have to do all the heavy lifting, and support our customers.Stephanie:Cool. I want to talk a bit about ... I was reading an article about how you guys, and you were shifting the company from this hardware model, to moving to a more SaaS model with your products, but also Outcome as a Service model.Stephanie:I want you to touch on that a bit because I though it was super interesting. You hear the world where everyone wants to be a SaaS company, of course, right now. That's the way of the future, but the way you explained it, I thought was really unique and interesting about how it's outcome-oriented. I was hoping you can touch on that, a bit.KS:Yeah. Definitely, as I said, Sensormatic has been transforming our portfolio across the board, right from sensors to systems to software to cloud. We did do most of our hardware portfolio. We can ensure that, now, even if you have bought it in the past, we can go back to the customers, some of our old hardware.KS:We have a mechanism to connect our old hardware, IP-enable them and connect to the cloud. We have invested quite heavily in terms of, how do you IP-enable all the hardware and take the data to the cloud? That's done.KS:Now we do get the data for our loss prevention portfolio. We get the data for inventory, and traffic portfolio. Almost all of them have a SaaS offering, and we actively sell all our SaaS offerings in the market.KS:Now, we also built a data lake on the top of all our SaaS offerings. Now, we get loss prevention inventory and traffic data coming into the common data lake. Now that I have the data, which I can correlate between traffic to inventory or traffic to loss prevention. All those correlations, you can do and come up with predictions and then prescriptions as well.KS:There's still, all the SaaS offerings, like any other Software as a Service, we deliver that. When you talk about predictive prescriptive offerings, now what we can do is, the example, previously I gave. You don't want the retail associate to spend time analyzing the data and trying to keep the business context in mind. Then try to solve whatever is the business problem that he has to solve.KS:The only way the retail associate is going to solve the business problem is by taking an action. That action is an outcome, and it's for a business outcome. We will be able to go, analyze the data on behalf of our customers. Based on their context, by taking their contextual input and then come up with a predictions and prescriptions that are specific to that particular customer.KS:When they act on those prescriptions, they're going to get a business outcome. So you can ensure that whatever business outcome they are trying to solve, you can enable that using our technology.Stephanie:Got it. Very cool.KS:When you're able to do that, you call that as an Outcome as a Service, where you say that, "Okay. Now I'm not talking about technology. I'm not talking about SaaS. I'm just going to deliver a set of outcomes, and then that's what you're buying from us. For us to deliver that outcome, we have to use several sensors, systems, software, AI model, everything, to get to that outcome."Stephanie:Yeah. I love that. I think of so many different consumer SaaS companies where it's like, you buy it, you get into this subscription. I'm locked into a year. Then it's like, you don't really use it. Sometimes you don't even know how to.Stephanie:I think of some of these big BI tools where you get in there and you're like, "I don't ..." Then you're locked in. It's so nice, entering into a mindset of, "I'm going to actually have something that shows me a solution right away, how to act on it. I don't have to put on my data hat and start analyzing it and figuring out correlations. I'm going to have something at least guiding me on where to even start thinking about that," which is awesome.Stephanie:Do you see any new shifts or things popping up right now, in the world of retail that, maybe you weren't even expecting a month or two ago?Stephanie:You're like, "These are some new requests that are coming in from clients, where they're trying to understand X, Y or Z, or they're trying to understand this new omnichannel world." Is there anything new that, now you're like, "We need to build this. We need to get on this right now"?KS:Yeah. I would not say as it's directly coming from the client, and I will just tie it back to the shopper behaving trends that we are seeing. How that's going to be the norm in future, and then how it'll shape the retailer.KS:If you really look at it, everybody is looking for a unified experience. I should be able to buy online, and then pick it up in store, or curbside pickup.KS:Now, BOPIS and curbside pickup, we see that many shoppers, for the first time, they experimented with buying online and picking it up from store or curbside pickup. We have seen some surveys, one from Sensormatic, one from NRF and another from McKinsey. All these surveys indicate that more and more shoppers will go for BOPIS or curbside pickup-based fulfillment.KS:This is going to be a norm. You'll have to support it. not everybody is implementing it today, but you'll see that more and more retailers are going to go and implement that way. The other thing, other interesting trend we have seen during the pandemic is livestream-based shopping, where you do a livestream of an event. Then as part of the event, you wear all the fashion clothes that you want to promote. Then people who are watching the livestream can click on the items and then they can make a purchase.KS:Okay, now we saw Walmart do in partnership with TikTok. We saw also, Nordstrom do an event like that. More and more retailers are experimenting with the livestream. I believe that in future, more and more retailers will try to embrace this livestream-based shopping, more than what you see today. I can only dole out some examples now, but one or two years down the line, you're going to see more and more happening in that side.KS:The other area, also catching up is, there are retailers who had big format stores. They are shrinking the format to the smaller format, or experience-only stores. You don't see many doing that, but you see few retailers doing that.KS:The experience-only stores, you have items you'll not be able to buy. You'll not be able to pick the item from the store. You can go to the store, you can experience the item, touch and feel. There will be lot of digital experience to augment that.KS:Then at the end of that experience, if you decide you want to buy it, you place the order. The item will get delivered to your home. That's an experience-only store. That's another concept that's just picking up.Stephanie:Yeah, but the shipping has to be good on that, because to me, I feel like so many shoppers are like me, where they need it quick. If I'm going shopping somewhere, I'm like, I probably want it that day. I love the idea of, the inventory's there for you to try on and see what fits, and get the experience, but I also want it that day, if possible. One-day shipping. Is that so much to ask?KS:I get it. Yeah, I think there are some who'd like to experience, and then they're okay to get it delivered to home. On the same day, if it gets delivered, that's again, that's why we call it a precision industry. They have all the inventory. If they have everything readily available in that area, they may be able to deliver few on the same day. Right-Stephanie:Yeah.KS:... if they go down this path. Smaller format is like, again, bring in more digital experience. Don't consume too much space, and provide a more digital experience. Then stock and operate with a smaller format. That's another trend that's happening.Stephanie:Yeah, which is nice because it feels like there's a lot more opportunity to beta test and see what could work at a much smaller scale than, maybe a couple of years ago, where these retailers are like, "Go hard. Open up a big shop. Have all this inventory." Then they're like, "Darn, didn't really predict that well. This might not be the perfect location for it, or there's not as much foot traffic as I might have thought, because Blue Bottle just went out of business," or whatever it might be.Stephanie:It's nice to be able to have a little testing ground, and then pivot if needed. Consumers are actually okay with that model, I would think, where, maybe back in the day, they weren't.KS:Yeah, yeah. Also, you see another interesting trend that's happening is, now for retailers who are embracing the omnichannel experience where their shoppers can buy online. They're converting some of the stores into a fulfillment store. That's what led to BOPIS.KS:Another trend you'll see is dark stores, where they're converting some of the stores to be, completely a fulfillment center.Stephanie:Yeah.KS:There is no store experience there. You only go to that store to pick the item that you've ordered and then walk out, actually. That's another trend that's happening actually, to support the unified commerce experience.Stephanie:Yeah. What kind of industries do you think are fit to pull that kind of model, because I feel like there are some stores where ... Is there ever a good experience when you go on to certain stores you're like, "It's probably a hard no for this kind of store. I just need to get what I need to get"?Stephanie:What kind of industries do you think, it would work well to just have your store as a fulfillment center versus the Urban Outfitters of the world, you need the full on experience?KS:I think if you really look at, Whole Foods converted one of their stores into a dark stores.Stephanie:Wow. Whole Foods is an experience though. How could you do that?KS:The problem is, it depends upon what you are comfortable purchasing online, without experiencing. Then if you have that, then you can go and pick it up. You know all your standard items, what you normally buy, and you have experienced it already.KS:Now you don't want to waste time going into the store. You just order it. I don't want to waste time and go pick it up, and walk out.Stephanie:Got you.KS:There are items that are very standard. There's nothing much to experience, go down this path. There are items that you have experienced once. Now you like it and you don't want to change anything. You're certain about it. Go order and just pick it up. Those are the areas where it'll pick it up.Stephanie:Yeah. Yeah. Got it. Do you think live streaming is actually going to penetrate the U.S., because I still just don't ... I feel like, actually, people here are getting burned out from live stuff. Clubhouse was big, everyone liked it. Now everyone's like, "Oh, so much work. I have to be on the entire time. I have to think hard and really jump on that deal, if it is live."Stephanie:It just feels like we all got in this stressful rat race of everything live. Now it seems like people are pulling back to the more, at least TikTok. Little bit more preplanned, Instagram, Pinterest, of really think about and be more mindful about their purchases.KS:Correct.Stephanie:Do you think that's coming here?KS:It is coming here. I feel that the Gen Z, even today, it is ... If I go to my son who is 18 years old, I can never take him to a retail store. They still prefer to shop everything online. They would like to see it online.KS:For a certain segment of shoppers, there may be a segment of shoppers who'll still be interested in shopping through livestream or shopping through the app. There will be certain shoppers who still feel comfortable, because we all grew up in an age of going to the store, and experiencing it and buying it.KS:We are more in need for a socially, going out and interacting and getting it. Such shoppers will continue to go to the stores, but there will be a segment of shoppers who'll continue to buy through livestream. Even if everything becomes normal, 100% of stores are open worldwide, there may be a segment of shoppers who'll shop, I feel.Stephanie:Okay. Yeah, that'll be interesting to watchStephanie:All right, well, let's shift over to the lightning round, if we can. The lightning round's brought to you by our friends at Salesforce Commerce Cloud.Stephanie:This is where I ask you a question, and you have a minute or less to answer. Are you ready? Yeah.Stephanie:Okay. What's the nicest thing anyone's ever done for you?KS:Oh. Anybody who helps me. I grew up in a world of gratitude. Anybody who does any remote help, I feel nice about it. Even small things, I feel very nice about it actually. It may not be a bigger thing.Stephanie:Okay.KS:There are a lot, actually, if you really ask me.Stephanie:All right.KS:I would say, I'm blessed. Every day, I get so many gifts in terms of people helping me.Stephanie:I love that. What's one thing your kids have taught you, that made you shift your idea on E-commerce or retail? You talked about live streaming, but what else have they taught you recently, that you're like, "Whoa, mind-blowing. Never would have thought about it that way, but you're 18, so you know everything"?KS:Yeah. If you ask me, I cannot buy a shirt or a pant without getting a feel for the cloth or fitting. Without getting a feel for the apparel. My kids will not even blink their eye in terms of ordering it. By looking it online, and ordering it online.KS:Even after they receive it, and if it's not good, they don't mind quickly returning it as well, actually. I find that as a hassle, but I learned from my kids that, it's a way of life. The first time I could sense that E-commerce is going to get adopted in a big way was from my kids, I would say.Stephanie:Yeah, that's great. What's one thing, or piece of technology that you don't understand today, that you wish you did?KS:The technology of 5G as well as, currently, people are talking about 6G. I used to work in a telecom industry. I used to play close attention to these two technologies. The pace in which 5G took, caught me by surprise. Then I had to go catch up.KS:Now I'm getting tuned to all the 6G news which people are pushing. Now I'll pay more attention so that I don't do the same mistake I did with 5G.Stephanie:How do you stay on top of all of the E-commerce trends? What do you read? What do you listen to? What do you do each day, to stay on top of that?KS:Yeah. I subscribe to a lot of ... Now today, gathering information is not a problem at all. I subscribe to all kinds of thing. You get McKinsey, Deloitte, Sears-based retail and so many other retail subscriptions and technology subscriptions.KS:Best time for me to catch up on that is mostly in the weekends. I spend couple of hours looking at all the things. That's how I catch with the technology and the trends.Stephanie:Well, KS, this has been such a fun interview. Where can people find out more about you and Sensormatic Solutions?KS:Thank you. Thank you, Stephanie. It's a pleasure talking to you. Hope to talk to you again.Stephanie:Yeah, yeah. Tell me where people can find you though? Where should people look up Sensormatic Solutions?KS:People can find me in LinkedIn, and the company, Sensormatic Solutions' webpage as well, they can find me.Stephanie:Amazing. Thanks so much.
10/06/2140m 54s

Growing, Failing, and Healing: Stojo’s Journey in the Omni-channel Space

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.---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---Transcript:Stephanie:Hey, everyone. Welcome back to Up Next in Commerce. I'm your host, Stephanie Postles, CEO at mission.org. Today, I'm chatting with Jurrien Swarts, the co-founder and CEO of Stojo. Jurrien, welcome.Jurrien:Hey. Thanks for having me.Stephanie:I'm excited to have you on. I was looking through Stojo a bit and your background. What was very interesting to me... You can tell me if this is wrong, but I saw a quote where it's like you and your co-founders were reading 4-Hour Workweek and that's how this came about, which to me was wild because everyone's read 4-Hour Workweek, but I've never actually heard of someone creating a company based off that model. I wanted to hear a bit about what was going on back then. Tell me the whole story.Jurrien:It's kind of wild. I was at Credit Suisse and had a colleague. He was actually my manager. We got into this habit of going for runs every day during our lunch hour and we had this two-guy reading book club going. One of the books that we eventually got to was Tim Ferriss' 4-Hour Workweek.Jurrien:If you read it, you could either create something because you're a creative, which today I'll call myself a creative but at the time, I was like, "I'm not a creative. I can't sing. I can't write. I can't..." They were like, "But you can also make something, preferably in China," I think was the guidance. I said, "Well, I speak Chinese. I've always had a thing for product and design. Just personal interest. Why don't we see if we can come up with one of those?"Jurrien:So we started to brainstorm and a few weeks after having read the book, or even maybe a month, Alex comes in and he goes, "I got the perfect idea. How about a collapsible coffee cup that goes in your pocket so it's easy to take with you on your commute and travel?" I was like, "That's not a great idea." I didn't really like it. I was just like, "Whatever."Jurrien:Another couple weeks pass by and I was actually in the shower, where I have a lot of aha moments. What's funny is the more I talked to other founders and other people, a lot of people have a place where they have their aha moments. For me, it's driving on the interstate long-haul between home to whatever or in the shower.Jurrien:I had a vision of my grandmother's daycare setup where she used to have the dishwashing rack. She'd always have the baby bottles lined up, taken apart. If you're familiar with those, they have a plastic reservoir, a plastic collar and a silicone nipple. It creates a leakproof type of seal with the screw on. I realized that if I took a collapsible dog bowl or [inaudible] type cup and put a lid on it like that, we actually could create this leakproof coffee lid that would actually help make this thing work.Jurrien:When I had that discovery, did some sketches and figured out that "Hey, we're on to something here." That's how it all started. That was 2011.Stephanie:So let's get back to your aha moment in the shower. You're like, "I know how to create a collapsible cup that won't leak." What did the process look like after that?Jurrien:Again, dating it 2011, '12. Rapid prototyping was just becoming a thing. They had things like the first 3D printers, et cetera. When you're making a durable good, you have the industrial design thing, you have the CAD files that have to get developed. When we went and priced that out, we were getting quotes of $30,000 to get to a prototype and maybe one or two iterations, way beyond the budget of what are significant others were going to allow us to spend. My co-founder, Alex Abrams, was the guy that I worked with at Credit Suisse. When we got that price tag, we knew there was no chance that our wives were going to sign off on that. We were just like, "Okay, this is done."Jurrien:A month later, Alex is at a Halloween party with his kids and he runs into Ben Melinger, who he was a fraternity brother at UPenn with. Ben had been a consultant and quit that job to work on a concept he had for a water bottle. He self-taught himself how to do CAD drawings.Jurrien:We said, "Ben, how's that water bottle going?" He's like, "I don't really know how to get it launched," et cetera. "Well, we have a project for you if you're interested." He said, "Sure," and so we made him an even partner. He did the CAD for the free, and then we started prototyping. That's how we took it to the next level.Jurrien:I guess for anybody who wants to do a product design thing, if you don't have the money for a designer and industrial engineer and you could expect to spend anywhere from 20 to $50,000 just to get that design work and prototyping done, find a co-founder who can industrial design and bring them in. It's the best way to do it because there's going to be countless iterations. You want somebody who's really vested in the product to make sure that what you come up with is really exceptional, and it's not just somebody who's doing it as a consulting gig and just wants to check it off their list and move on to the next project.Stephanie:I was going to ask, then, about how do you view... Especially maybe back in 2011, it's definitely probably newer but now, it seems like everyone is doing that, launching [inaudible], getting prototypes quickly. Do you feel like it's in a different place now, where you can maybe just go on an Upwork and hire someone to create 20 different designs for you? Do you think the world is different now where you might not actually need to find a co-founder?Jurrien:Yeah, I definitely think that. I mean, I think the power of Upwork and 99designs, things like that, is that it's open to folks who are living in areas of the world that are much cheaper to live in, and so you can actually get incredibly work out of Eastern Europe, out of parts of Southeast Asia, Asia. I've definitely gotten lots of help there.Jurrien:It comes down to your aesthetic and your attention to detail and your ability to curate and manage that process. But for anybody starting out, I'd say go for it. What do you got to lose other than some time and money? Usually, you get really good learnings from that stuff. I think that's totally a viable place to go. The other one is if you're college age or recent graduate and you had an engineering school in your school, you might have people that you can find that way as well who'd like to do it just for portfolio building, or just maybe you want to start a company together.Stephanie:Love that. What was your first sale like? Do you remember getting that first sale?Jurrien:Well, yeah. We had two first sales, if you will. We're an omni-channel business. We have our website and we do Amazon, and then we sell to brick and mortar retailers.Jurrien:The first sale was when we launched our Kickstarter in June of 2014, when we got that first backer and then the euphoria around that, having created a product, done a video, put together a campaign and then pressed Go was... It was really, really incredible.Jurrien:And then what was the fun thing about that was we went from zero dollars and passed our goal of 10,000 prior to midnight that same day. That was really great. Ultimately, we did... I think it was $128,000 on Kickstarter, so 12, 13 times what we'd set out to raise, which was... We needed the 10K to cover the tooling. That was really exciting.Jurrien:And then when we actually went commercial... So I left my job at Credit Suisse in the summer of 2015. The coolest thing was when the MoMA Design Store buyer came and found us somehow—probably through Kickstarter—and asked for samples. And then they actually bought our cup, and so we were being sold in the MoMA Design Store. It's like our first retail relationship. That was really special, as somebody who cares about art and design.Stephanie:That's awesome. So then after you were there, is that how other stores... You're in Anthropologie, I think Whole Foods. Is that how they found you, by just having that first retail customer, or did-Jurrien:No.Stephanie:... you get those partnerships in other ways?Jurrien:I mean, that was a slog. 2015 until May of 2018, I was a one-man band. My co-founders kept their day jobs and were involved in various ways, but for all intents and purposes, I was the one that I was all in. I had to learn and teach myself every aspect of the business.Jurrien:Frankly, I wasn't very good at the sales part of it. We got a little stop-start with Bed Bath, but our packaging wasn't quite right. We had supply chain issues just because of cash flow. We didn't have the right merchandising.Jurrien:It took bringing on a professional consultant, who's actually still with us today, is great, who really knew the retail category and specifically hydration and coffee tumblers. It's a pretty big category in the US. It's like a 22 billion-dollar segment.Stephanie:Wow.Jurrien:If you think about it, every major retailer, gas station, dollar store, every store is selling hydration. Getting somebody who really knew how that worked and then just slogging it out for a bunch of years, going to the trade shows, getting press where you can, evolving our product... We started with a 12-ounce cup, which was great for New York City-based commuter who goes to the corner deli and gets the 10 or 12-ounce cup of coffee that's the standard coffee in New York City. It also really works out really good for the UK, Australia, countries where they drink smaller beverages. But guess what? In the US, most people drink 16 or 20 or 24-ounce coffees. Our cup actually wasn't really optimized for scaling in the United States.Jurrien:It took until 2018 until we introduced what we call the biggie, the 16-ounce cup, and we added a straw because southern part of the country actually drinks a lot of sweet tea, iced tea, iced coffee for most of the year. Moving away from a hot-only, small, single-serve cup of coffee to something that's more common to the US market, that really helped propel us.Jurrien:And then we also moved away from... We started with some really primary colors. When I decided I was going to start a brand and really grow Stojo into something, I really liked how S'well approached the market. The way that I saw that play was they went hard after a very certain demographic, the [inaudible], female, millennial, Gen Z consumers. I saw that we could probably do something like that.Jurrien:Being in New York City, Brooklyn, I thought that's a pretty natural fit for me to target that demographic and try to have my sustainable product be almost like a fashion accessory. When we did that, that's when I think we started to appeal to the Anthros, the Madewells, the Food52s, the Whole Foods, et cetera.Stephanie:How did you go about that? Because I look at companies like S'well and a lot of the brands that are in Anthropologie and I'm like, "How they got there is so much through marketing." I mean, you can walk in maybe a TJ Maxx and see tons of S'well style [inaudible], stuff like that, where oh, looks pretty similar but the way they did it, like you said, attracted a certain kind of customer where it's like, "I'm a fan. I'm not going to [inaudible]."Stephanie:How did you go about it to become like that as well? What did you start implementing? What kind of marketing were you doing? What did that look like?Jurrien:A lot of it was, I think, just intuitive in the sense that since a very young age, I was always a consumer of brand. I liked brand. I would buy products based on their aesthetic, their utility, but also what the company's doing and saying.Jurrien:One of my favorite brands of all time was United Colors of Benetton. What appealed to me growing up in a really small northeastern mill town which was predominantly white, almost 99.9%, was seeing this just calico quilt of different representations of human beings and bright colors. Everybody in the photo shoots always looked like they were having a great time. I was just like, "Yeah, man. That's what I want in life. I want to be around beautiful, different people," et cetera. Jurrien:I think that always stuck with me. When it came time for me to helm my own brand, what I wanted to do... And I was also watching things like TOMS, Honest Company, looking at the Acumen Fund and their activities. I came from Credit Suisse where I was tangentially involved in a lot of socially-responsible investment activities for clients. I said, "You know what? I want to build a brand that does this, that's mission and purpose-driven."Jurrien:On the one hand, I have my sustainability message, and then I have control over the storytelling and the imagery that I want to put out there. What I want to do is appeal to people who want to support brands that they think are conducting themselves in society in the right way because it's the right thing to do and not because they have to do it or because it's the most expedient or the most profitable thing to do. I think that's the stand that I took, and then the rest was more... Because we're bootstrapped, I got a little bit more sophisticated in terms of the look and the feel of Stojo every year as I was able to hire people and bring on professionals. When we were shooting our own photography and I was doing my own graphic layout in PowerPoint, it's a very different look than when you start actually hiring designers and paying for photo shoots and then leveraging influencers, et cetera. There was an evolution.Stephanie:It seems like to build a brand like that, you have to rely pretty heavily on influencers. When I think about some of the brands that have really shot up recently, it does seem like that's one of the most strategic angles, to partner with someone who has your values and ideals and also the audience you want to reach. Is that a big part to your marketing playbook, or just a small part of it?Jurrien:It's huge. But interestingly, we've only really started intentionally and systematically, strategically, tactically flexing into that since, I'd say, August of last year. What happened was the height of the pandemic, we had to let go of half of our staff. We were about 20 people. We cut back to 10, to the most necessary. Really hard to do.Jurrien:But when we did that, one of the things that came from that was that we let go of our CMO, who was very high salary, recruited from a big place. The remit that he had was to help us scale this really quickly. We thought we were going to scale a lot faster than we ultimately did.Jurrien:When that all fell away, I just partnered up, actually, with my romantic partner, my life partner, Megan. She joined the team as a fractional CMO brand creative lead and she started implementing all these things.Jurrien:We were like, "What are we going to do with no budget? How can we do this? We got to get really scrappy. We don't have any money to spend. We have to be breakeven or profitable every month we can."Jurrien:The influencer strategy is one of those things that if your brand has the right market acceptance and fit and you can relate to the right individuals, it's a really, really interesting way to go. We've had a bunch of success there, but we're really still only getting started. But there's definitely a ton of brands that are those challenger brands that have done a lot of incredible work utilizing that. We're always watching what other people are doing and learning from it.Jurrien:Frankly, there's a lot of us who are starting to talk behind the scenes, management teams and making intros and talking to each other at roundtables and just sharing a lot of data and information. It's making us a lot more scrappy, successful. We're starting to punch above our weight, I think. A lot of DTOC brands are doing that.Stephanie:Yeah, because I was going to say it feels like the DTOC world is much more eager to share best practices and talk behind the scenes versus... I mean, we have podcasts covering basically all the C-suite and I hadn't really heard of a bunch of CMOs getting together and talking about best practices or the first 90 days, or CIOs. It seems like it's harder to do there, then all these new DTOC brands are like, "Let's all work together."Stephanie:How are you finding that community? Why do you think everyone's so eager to work together and share successes and failures?Jurrien:Well, I think it's structural and it's generational. If you got a big incumbent brand, they are recruiting from a very well-known set of folks in the C-suite. They've been doing what they're doing and it's working. They're sophisticated and they know their stuff.Jurrien:It works for them, given their size and scale. When you have billions of dollars in revenue and you're like, "My marketing budget is 10% of revenue," you know what you've got month to month, quarter to quarter. When you're a millennial or Gen Z-run brand, a lot of us just started doing it out of hey, happenstance from necessity.Jurrien:There's a lot of studies out there that if you're reading the blogs in Medium and LinkedIn and stuff like that that talk about... Even the New York Times, Wall Street Journal talk about how millennials are way more willing to share and talk about their personal finances, their negotiating tactics, how much they're making per salary, how much they paid for their house, their car.Jurrien:I think there's a lot of us understand that being transparent... And we kind of chatted about it a little bit about my personal approach to it before the show. When you share information with other people, if you're doing it to brag or whatever, that's one thing, and I think the older generation always thought that sharing is distasteful. You don't do it. It's not done.Jurrien:But I always ask, "Well, I don't know these things. You know these things. I'm asking because I'm trying to gather information and make data-driven decisions." DTOC brands and really good startups are all taking in data and tracking KPIs. They're making data-driven decisions. Not to say everything's data-driven, but there's a lot more of it.Jurrien:In our industry, everything's pretty opaque. I don't have the money to spend $10,000 for research on this one little thing, but I can certainly hop on a call, have a beer, share a coffee with somebody and just pick their brain.Jurrien:I think a lot of us are starting to do that. When you lead with vulnerability, transparency, authenticity—which these are all values we share and aspire to in our team, and it's part of what Stojo's about—and you say to somebody, "Hey. I don't know everything. I'm here to share anything you might need or want to ask but today, you have some information that I need. Would you be willing to share it? This is how I'm going to use it." 90% of the time, people are super thrilled to just be connecting on a real level and finding somebody that "Oh my God, this person respects me. They're a peer. I can help them and they can help me."Jurrien:It's a beautiful thing and it's really a metaphor for where we need to go as a society, is instead of thinking about everything as zero-sum games, just talking about how do we all get to happiness and balance and Shangri-La or whatever... I'm overstating a little bit, but this idea of just because I'm winning doesn't mean you have to lose. We can all win. We're going to be around for a long time. Who knows? Maybe one day, we'll collaborate together on something, et cetera.Jurrien:I try to foster that as much as I can. I really encourage people who are on the fence about hey, will this make me look weak or naïve or whatever, don't let that get in the way. Just think about what you have to gain, which is information that you didn't have before you asked the question and took that chance. What do you have to lose? Somebody that you don't really know is going to, I don't know, talk about you or-Stephanie:Not respond?Jurrien:Yeah, exactly. Or say no. I think training yourself to do that is part and parcel with becoming an entrepreneur and a leader.Jurrien:We shared our parenthood. The cool stuff about a lot of what happens in a startup environment and especially in me as a CEO, it's very similar to being a parent. You're kind of the CEO of the household. A lot of the stuff you're strong at or weak at extends to both areas of your life. You can actually get a lot of learnings and personal growth through comparing and contrasting methodologies and approaches at home and at work.Stephanie:I think there's not much of a separation between those two, especially now. The other day, I did this human design reading and test. Have you done this before?Jurrien:No, no.Stephanie:You might like it.Jurrien:Sounds awesome. Tell me more.Stephanie:Essentially, it tells you, "This is the design of who you are and how you might operate." I'll send it to you afterwards, actually.Jurrien:Oh, please do.Stephanie:You would really dig it. You need to have someone who understands how to read it, but it was very applicable to life and with kids and your partner, and then also thinking about business. It was saying certain things to me that I think I never had words, of like I felt a certain way, but then when she went through and was like, "Oh, Stephanie, you are an unconscious alpha. You need to lead in this kind of way, but you don't feel like you should be an alpha." I mean, it sounds a little woo-woo, but everything she has gone through I was-Jurrien:No, it doesn't sound woo-woo at all.Stephanie:I was digging it. It made me rethink how I even thought about myself when it came to work and life and just how it's all one and how to approach it in a completely different way than five years ago where it's like keep it separate. Don't try and mingle them together. That's when it gets messy. It was great.Stephanie:I think that's where the world's headed. Certain people are trying to just adjust to that new way of thinking now and is this even okay. It's okay.Jurrien:I love that. Please share. When say that, it's interesting. There's a lot of dogma that we are raised with as children that worked for the prior generation, or maybe it didn't, and we're stress testing everything nowadays.Jurrien:The one good thing about all the information sharing and the putting everything out there is that you get to try and think about and discard things a lot faster. You don't have to be pretty about it. I think this rapid prototyping and hacks approach that started with startups is now spilling over into dieting... Or not dieting, just the way you eat, the way you live, the way you sleep, the way you relate to your family and friends. I think it's going to bring about some really rapid shifts in human consciousness for the better.Stephanie:I mean, the whole world is changing that way. I think that's where any bubbling up around... Even the US right now is having issues because people are starting to... They're meeting people 3,000 miles away. They're finding their community in different ways. It's not all just based off like, "I live here" anymore and we're the same within this one city. I mean, now people are thinking very different and finding their communities and having more of a voice by coming together more than we've ever had before.Stephanie:The whole world's changing so rapidly and people are trying to figure out, "How do I keep up with this? Do I stick with our roots of how my parents' parents' parents have always done it this way, or can I expand and do something different and live like a nomad and go where I want and find my people and have an impact on the world in a different way?"Stephanie:So tell me a bit about was there an inflection point with the sales at your company where it's like you were a solo person for a while, your other co-founders were working full-time, you were trying to build these partnerships and you're like, "I need a consultant that can help me with retail." When was there an inflection point where you're like, "Whoa. Now, we're off to the races. I need to hire. I need help"? And how many [inaudible]? What was that level when you're like, "Now, we're about to go fast and I need to hire [inaudible]"?Jurrien:Let me give everybody just a really high-level overview on what happened from 2014 to today. We raised capital on Republic, the crowdfunding site, so a lot of that information is public to the extent it's appropriate and stuff.Jurrien:So we were bootstrapped. I started with 125K from my family and a friend, just a small little check to get started, plus the 128K that we did on Kickstarter. Before that, I think we each chipped in 10K. I think we had 20K and then we did the 128 capital raise. We did another failed, but 20K Indiegogo in 2016. Raised 125 in capital, then did a small bridge round before I raised my first round. I'll just lay that out because I think it's instructive and informative for people who don't come from the typical equity-raising background.Jurrien:In 2015, I had a half year of commerce. That was internet and online. We did about 200K in sales. The next year, we did 340,000. The next year, we did 405,000 or something like... I can't remember the exact numbers. This is all me by myself, so 2015, '16, '17.Jurrien:In 2018, we came back from some trade shows. The houseware show happens in the spring in Chicago and in Frankfurt. I actually got some international distributors. Suddenly, the orders started coming in from them because Asia and Europe were actually ahead of the curve over the US in terms of buying into sustainable, reusable products. We actually started getting distribution in foreign countries.Jurrien:The orders started coming in and there were too many. I'd just had my second child, who was not even a year. I wasn't getting sleep and I was just overworked, just dogging it. I had to hire a person.Jurrien:I hired Jake, our COO. He's still with us today. He came from MALIN + GOETZ. I brought him in. I interviewed him on a Friday and I had him at work on a Monday. I was like-Stephanie:Wow. When you know, you know.Jurrien:... "Dude, I need your help." Yeah. I just was like, "This is the guy. I want him in here." He started on Monday and he took over all these purchase orders that had come in.Jurrien:We thought we were going to do a million dollars in 2018. We ended up doing 2.7 million dollars in revenue.Stephanie:Wow, wow.Jurrien:That's when I was like, "Okay, I have a growth trajectory here that will look good enough to investors to try and raise a small C round." I did a pitch night at WeWork, where I was using their offices. We ended up getting I think second place in this pitch. They made a 75,000-dollar investment. With that, I was able to raise basically about 700K, which brought my lifetime capital raise to a million bucks.Jurrien:From there, we hired the team in 2019. I got somebody focused on sales and marketing. I got customer service. I got a designer. And then we ended up, at the tail end of the year, bringing on after we did not get picked to go on Shark Tank... Because we were holding for that to see if we got an investment. They passed on us, and so I decided, "Okay, I'm going to plow ahead and then beginning of 2020, I'm going to raise another round."Jurrien:We were able to get to 6.5 million in revenue, 6.5 or 6.7 in revenue in 2019, and had a team of 10. And then the plan was to raise our mini A or our next seed B or whatever you'd call it. We didn't really fit in a good category, but we're going to try and raise two to four million dollars at the next level evaluation.Jurrien:So I started hiring the team out. That's how from January to April 1st, we hired and we were at 20 people. We'd extended the last two offers right before the pandemic hit, and they were set to start on April 1. I think we gave them their offers the week before the pandemic hit. They were going to start two weeks later. We're up to 20 people and we're on a trajectory where we thought we were going to double revenue again. What in fact happened was we were unable to grow year over year in 2020.Jurrien:We'd hired a team that was supposed to preside over a 14 or 15 million-revenue company and we were going to be a six million-dollar revenue company again. We had to cut the staff. It was really, really difficult to manage through that. I'd never done that before.Jurrien:That's where we're at now. We're at the 10 people range. We're starting to hire again. We're pretty confident that we're going to have a doubling of revenue again this year. It's looking like a really strong year. We have some amazing launches coming up, et cetera. We're starting to build.Jurrien:What was kind of a blessing in disguise was that when we cut back the staff last year, we realized that what we really needed to be much more scrappy was a different kind of a team than I had envisioned. A year ago, I was one person. I'd never scaled before, never managed that many people, all these things.Jurrien:Today, where we are today is we know much more what we need, and we have agencies to fill the gaps where we don't have justification for a full-time head. Now, our forward-looking hiring plan is much more based on profitability, certain KPIs that we have and then just very real needs that we've already established because we have agencies and we're paying them X. We know when that expenditure gets to this, then we can justify a full-time head. There's a lot of great learnings from going through that, even though it wasn't easy.Stephanie:Sometimes I think those forced adjustments end up being the best learning... I mean, we had to go through the same thing at my company had to lay off half the team not due to COVID. It was back in 2019. At the time, it felt like the worse thing that could ever happen, crying on the phone. Most of these employees were my friends.Stephanie:But now, looking back and being like, "So many good lessons in that." [inaudible] how to hire, like you said. Do you actually need a full-time employee? How do you justify an FTE versus an agency versus having a one-off contractor? It ends up being a hard lesson but longterm, sometimes companies that go through this blitz are able to come out on the other side stronger than before.Jurrien:Very much agreed and actually, I'll call something out again, I think, for the benefit of any listeners who are those entrepreneurial-minded, startup type people shooting for the sky because I'm one of them. That's why I'm sitting where I sit. If you talk to investors, a lot of times investors are not those people. They're actually the pragmatists and the realists. They've literally seen thousands of businesses like yours do either one of two things. They're usually much more disciplined and pragmatic. I think a lot of times, COOs, CFOs, those type of people also tend to have those personalities.Jurrien:What ends up happening is as an entrepreneur who's like, "I just need to make sure that we don't stall. We got to get it done. I have to make a decision now so I can go on and do the other 50 things on my plate," a lot of times there's a lot of inefficiency in that decision-making process. It's just guessing. What has to happen over time is the company needs to be run less on the seat of the pants and less on intuition and much more on discipline and just time-tested tactics of sound business principles.Jurrien:That's what, at a very high level, happened to you in 2019 and what happened to me. As a founder going through that injects you with a sense of realism and it matures you.Jurrien:It gives you wisdom, I think, that prior to that, because everything was on the up, you didn't really have that. You didn't have time for naysayers. You were defying all odds. Now, it's like no, it's not just about my vision and me anymore. It's actually a company and I have a responsibility to all these people. Accounting principles are going to define whether or not I'm still a business a year from now. I have to listen to those.Jurrien:I think that's the shift that can happen. It's really powerful when you go through that lesson. Your company doesn't implode. You come out through the other side of it. Those are learnings you're never going to unlearn.Stephanie:Yep, yep. I also think the emotions lead the scene where it's like during the time, you're just like, "Horrible," crying, the worst. Thinking about it now, it's how I would even operate, it's like you just... It is a cut-and-dried thing. You've got good margins or you don't. You're profitable or you're don't. Here's your [inaudible]. If it's not there, it's not there. There's no amount of friendships and feel-good anything that's going to fix that-Jurrien:Exactly.Stephanie:... I think, was one of the one of the top lessons for me.Jurrien:That actually ties back to that point that I made: if you don't take care of yourself first, you can't take care of others. If the company isn't sound and it can't pay its bills and keep the lights on, you can't employ all these lovely people who of course depend on you and trust in you and rely on you. But you have to make decisions as the leader in ways that will keep the boat afloat or keep the greater good going. Sometimes, you unfortunately have to make decisions that aren't popular, you don't like, you feel terrible about. But it's not about that.Stephanie:Thousand percent agree with all of that. I know we are running out of time, but I want to do the lightning round with you because I think you're going to have some epic answers.Jurrien:Oh, geez. No pressure.Stephanie:Uh-oh. Lightning round's brought to you by our friends at Salesforce Commerce Cloud. This is where I ask a question and you have a minute or less to answer. Are you ready?Jurrien:I think so.Stephanie:All right, first one. I'm secretly curious about what?Jurrien:What the profitability metrics are of the top 20 DTOC brands.Jurrien:The real deal on the numbers.Stephanie:That's a good one, I thought, though. Something wise my elders taught me was...Jurrien:To always make eye contact and listen to what the person's saying and give it a moment before you respond.Stephanie:That's a good one. You're very good at that. You made eye contact the whole time. Good job. What's up next on your reading list or on your podcast list? What are you diving into these days?Jurrien:Jesse Pujji did a podcast, Invest with the Best, I think it is, where he was talking about his approach to performance marketing. I've listened to it twice and I want to hear it again because it's so thick. That's one.Jurrien:Then there's this other podcast that I can share. I'm terrible with names and remembering things like that, but it was two of the original folks, the early hires at Amazon. They talked about the Amazon memo and narrative and the PR/FAQ approach. We're actually employing that at Stojo right now. Again, very incredible paradigm shift in the way of managing and sharing and presenting information and coming to decisions. So two things I'd highly recommend to people.Stephanie:Cool. I'll have to look that one up and drop it in our show notes. What do you when you want to feel more joy?Jurrien:I like a little bit of cannabis as a night cap and I really like to run.Stephanie:Nice. All right, and the last one. This may be a little bit different than cannabis, but same same. What's one thing that will have the biggest impact on e-commerce in the next year?Jurrien:Oh, that's funny. I think the battle of Facebook-Apple. I'm really interested to see what happens there, how we figure out how to continue with attribution and respect people's rights to privacy.Jurrien:My gut, if you think about the right thing, is we should attribute a commercial value to everybody's data. I as a individual should have the right to monetize and share that data. People should pay for it. Because I'm okay with people having my data because I think it leads to better decision-making and better functionality of the whole machine, but I want to know who's got it and how they're using it. I think there should be value for it for anybody.Stephanie:I agree. All right, Jurrien. Well, it's been such a fun interview. Thank you for coming on the show. Where can people find out more about you and Stojo?Jurrien:God. Look me up on LinkedIn. Check Stojo's Instagram and our website, obviously, and then give this podcast a listen.Stephanie:Yes. Do it. All right, well thanks so much for coming on. It's a blast. Been a blast.Jurrien:Thanks so much for having me, Stephanie. And Hilary, thanks for your work on the back end there. Really appreciate it.
08/06/2140m 55s

The Most Engaging Avocados on the Internet

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.---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---Transcript:Stephanie:Hey there. And welcome back to Up Next in Commerce. This is your host, Stephanie Postles, CEO at Mission.org. Today on the show, we have Ivonne Kinser who currently serves as the head of digital marketing and ecommerce for Avocados From Mexico. Ivonne, welcome to the show.Ivonne:Hi. Thank you for the invite.Stephanie:Yes. So happy to have you on. I think I just spent an hour going through your guys' website and then I got hungry and I realized it's probably not best to have avocados and salsa right before an interview. So let's see how it goes, I was willing to take the risk.Ivonne:Maybe it's a good thing because you can always get... Go for an avocado.Stephanie:Yes. Yeah, I agree. So before we dive into Avocados From Mexico, I was hoping you could touch on your background a bit. I saw that you moved from Venezuela to Dallas in 2001 and I thought that would be a fun point to jump off on hearing a bit about what inspired that move and what brought you here.Ivonne:Yeah. I mean, if you think about it now, that was a long, long time ago. I came and my first job here actually in Dallas, I have been here for over 20 years or 20 years this year actually. And I oversaw over 20 countries, the campaign of or the advertising for American Airlines across 20 countries in Latin America. And I was there for a long time, I think relatively I was there for about five years before I went to the resource group in Dallas and then I started going from agency to brands and brands to agency.Ivonne:I like both sides of the business until a point where I made a decision and I really liked to stay on the brand side. So I stayed there and right now I have been with Avocados From Mexico for seven years now.Stephanie:Wow.Ivonne:And counting. Yeah.Stephanie:That's amazing. So what pulled you to Avocados From Mexico? Because when you look at your background and what you just went through, it seems like such an interesting jump and what was the draw there?Ivonne:It is interesting. That's a great story. My career is full of stories but this one is one of my favorite ones because I have... I was also on the brand side with American Airlines after managing their account on the agency side, I went to the brand then Haggar company, Haggar Clothing then for a while I even go on my... I went on my own. I was very curious about entrepreneurship and just implementing my own ideas. It went great. It was on the fashion side, it went great, but I really missed the security and the stability of the corporate world and is when I went back then and went to Haggar Clothing and then Avocados From Mexico. But to your question my point is that fresh produce was nowhere in my experience or in my career.Ivonne:I was in transportation, telecommunications, fashion, apparel, retail, never even like the minimal experience in the fresh produce category and then the recruiter of Avocados From Mexico contacted me because they were studying the company actually, which is the marketing arm of two organizations, the growers and exporters of Avocados From Mexico in Mexico and the importers and the Packers and distributors of Avocados From Mexico... Hass avocado in the United States, they came together and created a marketing arm to market their products, avocados coming from Mexico. So at that point they appointed the president who is my boss, Alvaro Luque and he has been there from the beginning 2014, 13, and the recruiter contacted me and asked me if I was interested in going and speaking with them, with Alvaro and I was like, "What? What am I going to do with avocados?"Ivonne:I mean, I have... And that was before the first Super Bowl so I didn't even know that brand existed or anything. And she said, "Just go and talk to him and if you're not interested then fine, but I think that you would like it because it's a very entrepreneurial organization, is a very forward thinking and he is looking to really make an impact in the marketing industry." So that got me curious and I went and talked to him and yes I was fascinated with his vision. He told me the magic words. He say, "I want someone who... I'm looking for someone to build the digital marketing department from the ground up." And when I told him like, "Why me? I don't have any experience in the category."Ivonne:He told me that he was not looking for someone with the experience but he was looking for someone with very good solid expertise in the digital marketing side of the business who was very creative and who would be able to do what nobody else has done. And those are my magic words. I'm very creative. I love creative freedom and do exactly that, what nobody else has done. And besides is one of the very, very few cases in marketing where the marketing budget increases year over year because it's proportional to the sales volume and the sales volume of avocados have been growing year after year... Year over year since 2007 and especially since 2013. So I was sold.Stephanie:That's great. Yeah. I mean, such a good story and it's so interesting too when I think about other produce items in a grocery store, you would never even think like, "This avocado bag has a whole content strategy behind it." And they do Super Bowl commercials and like the stuff that you guys are doing to me seems so innovative. You're taking all the risks, you're trying things but what did it look like before you joined? How were they marketing and selling avocados? What was the landscape before maybe they entered the digital world?Ivonne:So when I started there, that was 2014, there was no digital marketing department per se. I mean, we were doing... We had a social media and we had a Facebook page and we have a few bloggers creating content, but I think that was about it. And then I started in September and my first assignment was okay now you have to build up Super Bowl digital campaign. And I was[crosstalk 00:08:43] okay. Yeah, whatever that means, right? But what has been very exciting about it is that we were talking offline before there was no preconceived notion of how a marketing practice should be. And that was... I think that is what has allowed us to do everything that we have done because nobody has ever say, "No, that's not the way we do things here." There was nothing.Ivonne:So we start creating, at least I can speak for my department that I started creating the marketing department that I thought and I think right now that is the right for these time. And one of the things that a lot of companies do is to become complacent and keep doing things the way they have been doing it for years without even realizing they are doing them. In our case, there was nothing. So it was a blank slate for us to build whatever our imagination can see. And like I was saying, my first assignment was... Was in September, I started in September, right? Super Bowl is next February and building a campaign, you can not build a campaign in just two weeks. So what's literally my first assignment is now you have to build a Super Bowl campaign. And it was the first time we went to the Super Bowl with a TV spot.Ivonne:So I did what I thought that it was best and not knowing or having an experience of what even means to be a winning Super Bowl campaign, right? I just did... Put a lot of love and passion into that but the best I could. And then I remembered that the very next day after the Super Bowl I had a call from one of my agencies and says, "Congratulation for the digital campaign." And I said, "Why? What for? What happened?" They say, "It was number two after Procter & Gamble."Stephanie:Wow.Ivonne:I said, "What does that mean?" And then it was in terms of the most social interactions, the campaign with the bigger bus after Procter & Gamble, imagine that. And that was the first year. After that we launched six more and every single year we were either the top one digital campaign or top two digital campaign. Of course now I knew, "Okay, somebody is measuring this. We're very competitive." So and then we purposefully look for that first and second place but the first year happened just spontaneously. We didn't even try.Stephanie:I mean, I want to dive more into that because I just watched your Super Bowl commercial from 2020 and it was so funny about what your avocado needs. It needs a helmet, it needs a baby carrier for it so it gets more skin to skin contact. I mean, it was really good, writing and super funny, which I feel like sometimes I don't always laugh at things. It actually was giving me a good belly laugh and I want to hear how you go about developing content in a way that you did especially with your Super Bowl commercials that are winning awards and coming in number two, how do you guys even start creating that campaign from scratch to make it connect with a lot of people?Ivonne:Yeah. You know that... I will say the most challenging thing about the Super Bowl is connecting that content across the different departments and disciplines because the concept of the TV spot comes from the brand team and the brand agency. So and I have my team and different agencies. We're like I mentioned before, we're very entrepreneurial organization. So pretty much every lead of every department gets to choose their advertising partners, whomever you feel more comfortable working with for whatever reason based on expertise or closeness or whatever it is. So then we have to... When the brand team define what is going to be our theme and they go to market to test three or four options and then they decide this is the commercial we're going out with. Then they give that to the digital team, to my team and I share it with my agency and we start concepting the digital campaign. And the digital campaign have to be able to stand alone and live on its own, stand up on its own but it has to have some connecting tissue with the TV spot. It has to look like the same story.Ivonne:But that is a huge challenge because how can you bring a story that in TV is 30 seconds and transform that in an experience that it has to keep users engaged for three weeks, because that's the time when we launch the digital campaign until the game day is about two, three weeks. So it's a big challenge. And we have... We develop all the experiences in digital with that connecting tissue in mind but created for digital audience is not only for them to watch, but for them to experience, to play with it, to interact with it, et cetera.Stephanie:Yes. How do you think about building out a call to action that gets people to go back to your website? Because oftentimes I watched these Super Bowl commercials and I definitely have more brand love towards the brands that make really good engaging or funny content. But I don't know if I've always felt drawn to go right over to the website. How do you think about making it a funnel that's actually going to convert and pull people into your avocado community?Ivonne:Yeah. Yeah. I'm going to tell you the story, I tell you I have many stories about the Super Bowl but let me tell you one that will illustrate a great, great example. Years ago, we also had a float in the Thanksgiving Macy's Parade and it was the same dynamic. The brand team who also manages PR has this project or this idea to go do the Thanksgiving Macy's Parade with a float. So we had a float then the CEO comes to my team and say, "Hey, we're doing this in brand so what you guys have to do is to create a digital campaign to go with this float in Macy's Thanksgiving Day, but it's going to launch three weeks before then we start concepting." So what we did is how we can do so users keep coming back after three weeks, every day, right?Ivonne:Because you want them to go come every day and participate every day and interact every day. So what we did is that we develop an interactive map and the story was that we're bringing the float from Michoacan, Mexico from where our avocados come from all the way to New York and you will see how... Stopping in key cities across the United States from Mexico all the way to New York city. So in each city we have videos, we had what are we doing in that video, in that city, et cetera, et cetera. But the key was that the only way the float can move is when users tweet or hashtag. So the more they tweet the faster the float goes to New York and we know that we have to be in New York by a certain day.Stephanie:Wow.Ivonne:So that was so exciting. I mean, users were so excited about it that the day of the parade, when we were monitoring the conversation online and you could see the excitement and users saying, "That's my float." And that was the most rewarding feeling because they felt that was their float because they brought it from Mexico. And just to wrap up the story, we deliver more impressions of, or campaign than the Macy's Parade hashtag, imagine that and-Stephanie:That's impressive and crazy.Ivonne:Yeah. I mean, we're just... Have the power of engaging the audiences, they work on your behalf and because we don't have the dollars that the multi-billion dollar brands have to compete in this type of competition if you call it, like the Super Bowl, for example. But we still have been top one and top two in terms of the most talked about brands and it's because we engage the users and they do it for us.Stephanie:I mean, that's why when I was digging into this Avocados From Mexico company, it was so exciting because at first I'm like, "It's a company about avocados." And I started seeing all these things you're doing I'm like, "They are really pushing the limits when it comes to marketing and being super creative of how to pull people into these funnels and get them engaging." And, yeah, it's super impressive. How do you think about the ROI around a Super Bowl commercial versus a float in the parade? What should the ROI look like or what should companies be going after when thinking about these really big moonshot level marketing campaigns.Ivonne:So every company is different and every company has different goals, right? But we don't manage or sales, we're a marketing organization but our job as a marketing organization we have two objectives that which is, build the brand Avocados From Mexico in the US and increase the demand of Avocados From Mexico in the US. So when we create these campaigns that has an enormous boss what we want to do is to put avocados top of mind. When you have, and I give you the examples of Super Bowl campaigns, when you have, for example 7 billion impressions that was a Super Bowl this year, 7 billion potential impressions on social media. Yes. I mean, you can tell the consumer heard about Avocados From Mexico a whole lot. So when they go to the grocery store, you're top of mind and and our conversation of course is very strategic.Ivonne:So we wrap our conversation around a fun story but really in the core of it, there's recipes, there's conversations about how to consume the avocado. In Super Bowl, for example, we say guacamole, we talk a lot about guacamole and Super Bowl. There's a research company called YouGov, the previous two years they did a survey one month after the Super Bowl and they publish their results and they say the winning brands one month after the Super Bowl. And Avocados From Mexico also is among the top one or top two in terms of purchasing tension increase even a month after the Super Bowl. So, and another thing is when you go and see... We're talking about billions of impressions in social media, right? And then you may think, "So what is even an impression? Who cares?"Ivonne:But it is important because that huge conversation that happen in social media is just a reflection of users engage talking about it. And when we go to, for example, and check the Google trends, how the searches for Avocados From Mexico, the brand, the brand name, the search for the brand name the peaks overlap. When our conversation on social media is very, very high, you also see those peaks of Avocados From Mexico, the brand name search is very, very high at the same time. So, yes, I mean, all this huge conversation that we create with campaigns like Super Bowl, Cinco de Mayo and Thanksgiving Macy's Parade, it really impacts the interest for the brand. So going back to our objectives which is build the Avocados From Mexico brand in the US check and increasing the demand of Avocados From Mexico in the US check, because we have seen also how these YouGov for example, is one of the companies that have shown the increase in purchase intention.Stephanie:Yes. Yeah. That's amazing. So, I mean, thinking about all these marketing campaigns that you've done, what is one of the more risky ones that you've done that actually ended up working where maybe people on your team were like, "It's not going to pay off."Ivonne:Yeah. One thing that I always start thinking even a year before the next Super Bowl is what kind of technology I'm going to integrate in the activation. I think that we live in a world that is dominated and I say this in a very positive way, I believe in technology as a positive force to move the industry forward. So, and there's new technologies every year and I see the technology not as a shiny object, at least not all of them but as a... Like I says, is what is moving the world forward and the marketing industry forward. So I start thinking about what technology I'm going to bring the next year. So last year and it was actually that campaign that you referred at the beginning, I wanted to bring the Vatoms that actually right now are super, super popular right now.Stephanie:What are they?Ivonne:NFT or they call it also NFT. Have you heard about NFT?Stephanie:I mean, I've heard of NFT is in the non-fungible tokens-Ivonne:Yes[crosstalk 00:24:25]Stephanie:Okay. Okay.Ivonne:Yeah. Yeah.Yeah.Stephanie:Al right.Ivonne:So then those are super, super popular right now in 2020. 2020, the other name is Vatoms.Stephanie:Okay.Ivonne:In 2020, we actually were the first... One of the first brands that use that as a marketing tactic and we were the first brand to put one of four advertising assets in the blockchain and that was even before everybody[inaudible 00:24:59]Stephanie:Wow. That's so early. You guys are ahead of every trend, basically.Ivonne:Yeah. I mean-Stephanie:Have you done AR already. I was thinking you have to probably have an Augmented Reality experience with your avocado. You guys have done everything.Ivonne:We did, actually was part of that same strategy. So what happened is last year I say, "Well, I want to do something with NFT, let's call it NFT even though we call it Vatoms last year, but NFT and we did, but what it makes so challenging to be early adopter or a trail blazer that you're bringing something that it hasn't been done before is that it's really, really hard to explain and sell the idea within the organization is like we're putting money towards these, we're allocating budget toward these and it's something nobody has done before is that going to work. And honestly, the answer is, I don't know. I mean, how can you know? You don't know if it's going to work but what we do is when we experiment with that kind of things, we experiment cheap as much as we can and we are really well prepared to pivot if we need it.Ivonne:So my agencies, and when I select my agency partners, it has to be someone that is extremely fast moving that or adaptable and can choose with a call cheap directions because if not, it wouldn't work for the type of approaches that we take. And when you can move that fast and when you have partners that can move that fast, the risk is minimal because we're in... I mean, in the digital space you can course correct in real time and you're going to be fine. The problem is when you don't have the right partner that can move that fast and you know that the campaign is failing or there's room for improvement or it needs to be optimized and you cannot react quickly. But it was a big success in terms of the, it created a lot of buzz and a lot of... Media talk about it and a lot of consumers came and visited our site and participate in our games too because of that.Stephanie:Yeah. That's amazing. So tell me a bit more about the NFT strategy. I mean, I understand the concept of them putting on the blockchain a scarcity thing, limited quantity but what were you actually putting on the blockchain? And are you going to do it again in 2021 now that more people understand the concept of it because of the NBA top shot stuff that really put it on the radar of a lot of people who maybe wouldn't have known about it before?Ivonne:Yeah. So what we did is a mix between Augmented Reality, actually it started... The idea started with Augmented Reality so users will sign up to get at the UTA wallet and then they will go to Google Walmart, for example, and then they will find avocados, digital avocados all over and they will capture the digital avocados with their mentor reality and save them to their data wallet-Stephanie:Like a Pokemon Go kind of game.Ivonne:Kind of. Yes.Stephanie:Okay.Ivonne:Exactly. Exactly like that. So they will call it the avocados and then exchange it for every avocado that they collect is a point. So it was part of a big game. So, but when one of those was a crown that you also saw in the TV spot and that crown also, we place it in the... To develop these kinds of objects, it requires special coding so we coded and somebody... And then users will participate to win it and the winner, we will send them the instructions and it was an object that could be placed in the blockchain and they could then sell it or collect it or save it for later or whatever they wanted to do. So it was like testing the waters without going all in but we want to do one. I think that's one of our goals as a company is just, if anything is going to be tested out there in marketing, in the fresh produce industry, we want to lead that.Ivonne:And of course we saw this is coming at some point. In fact, it came a year later but we know this is coming, this is common in marketing so we have to do this. So we did that the previous year, just to name another technology, we built an experience with IBM Watson, the artificial intelligence and that's another great story because it was such a creative implementation of Watson that even IBM contacted me and to her, "How do you guys do this? Tell me the story," and whatever. And then they send an email to all their subscribers using our campaign as a case story like, look how creative Avocados From Mexico is using Watson in a marketing campaign, because it was a totally unexpected application of what so now artificial intelligence tool.Stephanie:Wow. I mean, you're basically giving you a peek into the future, just thinking I want to know what you're thinking at all times, because you probably are thinking two or three years ahead of what other brands when it comes to a marketing and technology perspective are even thinking about right now. So what are you focused on over the next year or two? What are you guys betting on that maybe other people would look at, you'd be like, "Ivonne, that's definitely not going to play out. No one's interested in that." What are you guys shooting for right now or focused on building from a marketing campaign perspective.Ivonne:Yeah. So two things I want to say about that. First, let me tell you, we're in the middle of planning 2020, 2022 planning our fiscal year ends in June and it starts in July, so we're right now are planning processes in full swing. So any ordering process is six months. So in one of the first meeting, the opening meeting where I get to talk to my team before they start even thinking about what are we going to do for next year? I wanted to make very clear where has to be our focus and I told them and something that is... I think is served as a guide, when we look at the future, we need to see what are those forces moving us toward the future. Instead of looking at what is trending because I wanted them to differentiate what are the trends and what are the forces. The trends are now and they may fade, but the forces are what is going to build the future. In this case right now where we are, I will say the forces are definitely artificial intelligence, machine learning, data, 5G is going to change the way we consume content and the way we consume video.Ivonne:The trends, for example, on the other side are I will put gaming in that side is trending right now. I will put in home fitness, I will put... It's a trend, it may be permanent but it's not something so transformational as it is artificial intelligence, data and machine learning. So what are we focusing in the future? We choose to launch a platform called Avocado Nation, is an intelligent platform with artificial intelligence and machine learning engine at the core of it. We call it the next fix of avocados because it has the same intelligence power, obviously much smaller than Netflix but it was... The inspiration was the way Netflix deliver personalized content to their consumers. And as most of the content production companies, they have like 30% success rates in the shows that they put out there. I believe that the last number that I saw for Netflix is like 70% and it's because they really, really relied on that intelligence.Ivonne:So inspired with that, we say we want to create the Netflix of avocados and that's just one of the portions of this intelligent platform. And we have right now over 100 videos our goal is to get 2,000 videos eventually. And it's videos like any format, short videos, long videos, funny, serious of videos that it could be... It could go from a dating show to a recipe show, all kinds of videos to give the consumers a variety of content for them to interact with and in the meantime, the machine is learning from those interactions and helping us to make predictions in the future about what is the content that our first party data is more engaged with.Stephanie:Yes. Yes. I was just going to say the first party data access is probably... Is that big driving force behind creating an entire platform like this.Ivonne:Big driving. Actually, that was the purpose because with all third party cookies going away and all that, we have been working on that for several years now. And right now we have over 100 million users on our consumer data platform and we have a costume audience, that's our core audience, about 30 million consumers. So we already have... Again, we have been preparing for this since 2015 talking about looking toward the future and when all this happened and a lot of brands are scrambling to get ready quickly, we already have our audience. You never complete with... I'm the one building my audience. That's something that the machine keeps learning, the algorithm keeps learning but we're in a very, very good shape in terms of first party data.Stephanie:Yes. I think it's interesting too that you approach the platform in a way like an AI first focused way where I talk to and hear from a lot of brands and many of them are very focused on content, creating their own series and figuring out how to make that work for the company. But it's very interesting hearing that you're essentially approaching it like a Netflix style model and even thinking back to... I don't know if you remember the earlier Netflix days where when they started coming out with their own originals and people were like, "They're not good." It's like the whole time they were just using that as training data, they were learning what we like. They were learning what makes for a good series, what kind of format are people looking for? And I love how you guys are approaching your platform with that as a focus first instead of trying to figure it out afterwards and figure out, "Why aren't people interacting? Why aren't they loving this series?" Super smart.Ivonne:Yeah, exactly. And you know what? I have my agency, I have several agency partners but I have one that is over all the development and optimization of the website, et cetera. And I told them, "This is an ongoing project, is going to be always an ongoing project because... And I want to iterate every single week because the algorithms are learning. And as we learned about how users are interacting, there's always going to be something to optimize and change and improve the user experience and the user journey. So it's a mind shift because you are iterating and calling it changing, tweaking, it doesn't mean that the platform need is broken, it means that there's always, always, always the consumer behavior is changing and if you forget about that and just launch something and leave it, is going to be outdated next month. So you have to change as your consumer expectations and preferences change all the time, it never stops.Stephanie:Yes. How do you want... I mean, when thinking about your employee base, it sounds like they're working on a ton. You can be working on Super Bowl commercials, you can be working on day to day, like traffic generation. You can be working on an entire content platform where maybe you're trying to bring on new musicians and getting new series created. How do you instill a sense of creativity and an entrepreneurial spirit in them so that they're willing to jump around and work on all these things?Ivonne:It's just a lot of fun. I mean, I think that is... I work with seven agency partners because I think we do so much and every one of them has a specialization in one of the digital... The areas of digital and all of them I think say that Avocados From Mexico is their most fun account. And is one, because it's a fun brand but also because also they have a lot of creative freedom. I really value creative idea that is also strategic. We're very, very strategic. And as long as it ties to the strategy, the sky is the limit, their imagination is their limit. And then we really have fun bringing these crazy ideas. And we do so much that is impossible for one person to bring all the good idea. So everybody has the opportunity to participate and to lead and manage their own projects and they work also very collaborated between all of them and all the agencies, it feels like one big agency working together but it's really different partners.Stephanie:Mm-hmm (affirmative)Ivonne:And it's all about ownership, when people feel the ownership of a project it's amazing what they can do.Stephanie:Yeah. That's awesome. So do you have any advice around working with agencies? Because we've heard from quite a few people that a lot of them have worked with agencies, they didn't have good experiences they ended up the creative and the branding and marketing campaigns back in house. And so how do you go about making sure that you're setting up a great partnership and finding these agencies like these that you speak so highly of?Ivonne:I believe that the agency choice is such a personal choice. Let me explain, the person that is... Or the company culture, the culture of the team, this agency is going to work with internally, the decision maker within the organization has to be a perfect match with the agency. And with that, I want to say, there's not a perfect agency for every... There's not a one pit soul. And I'm not talking about, there's great, great agencies that may not be a good fit for certain people or certain companies. In my case and in the case of Avocados From Mexico, just because we have the freedom to slate the partners we want to work with, they are a perfect match. And I think that makes a difference.Ivonne:So what is my criteria, is that they have to be a very, very creative agency, which of course, any agency should be, but it's a different kind of creativity. They have to move fast, they have to be nimble, they have to be a non-conformance. They have to be... There's so many things that it wouldn't work for us if it wouldn't be that way. And I think that every... That freedom that we have to select our partners should be... Any company should have it because it's like selecting a life partner or selecting a business partner is someone you really, really have to compliment each other and fit perfectly.Stephanie:Yeah. Really, really good advice. All right. Let's shift over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I ask a question and you have a minute or less to answer. Are you ready to Ivonne?Ivonne:Yes. Stephanie:All right. Hard one first, what one thing will have the biggest impact on ecommerce in the next year?Ivonne:Data.Stephanie:All right. Tell me a bit more, what are you thinking around data?Ivonne:Well, data, and I think that companies... Any company, any technology company that has anything to do in that feel of ecommerce is really, really fast right now creating the new best solution. There are things they are working on right now that are going to come out next week or in a month or two months that doesn't exist now. And they are building all that based on data they are capturing now as we speak. So I think that data is going to be the big driver for technology capabilities, for how the technology is and users are going to interact with each other. And there's so much data out there that we are learning right now how to organize it and how to activate it. And that knowledge is what is going to be used to build the next generation of ecommerce tools.Stephanie:Yes. Love it. When you want to get into the creative mindset, what do you do to get into that-Ivonne:I walk.Stephanie:You walk?Ivonne:I walk in nature. It's very unfortunate what happened to the world in this last year. A lot of people... So really sad consequences but I can tell you in my case I think professionally speaking, it was my best year ever. It was my most creative year, my most productive year because I realized that the way I create is by being close to nature and being with my own thoughts and using that reflecting on things that I talk with people in the industry, things that I read but then going back and retrieve and reflect on those things. And I think definitely, I think that everybody should have that space to let their creative power to work on[inaudible 00:46:44]Stephanie:Yeah. I love that. I feel that I also... Yeah, I get very inspired when I'm just out walking and hiking and yeah, I think that's definitely a way to jumpstart that.Ivonne:Yeah. And I like to, I go on a bike, right now that it's getting warmer here in Texas is biking time again and I think my best ideas come when I'm on the bike or when I'm walking, because you don't have interruptions, you don't have a phone ringing, you don't have texts, you don't have anything. So it's you and your thoughts and the brain is an amazing machine that is processing everything that came in at some point and organizing it and making sense of it and coming up with new outputs.Stephanie:Yes. Yeah. You just have to bike on down to Austin, when you get here, we can go on a hike and we'll be super creative and you'll be really in shape so...Ivonne:Awesome.Stephanie:It'd be great.Ivonne:Love to.Stephanie:If you had a podcast what would it be about and who would your first guest be?Ivonne:That's a hard one. I think it will be definitely something related with technology. It will about disruptive technology and new shield solutions. I don't know exactly it doesn't come to my mind what will be my first guest but I think that I would love to interview a woman in technology. I think it's a field where women are being very successful but it was not until recently that they really had a place on the table in that industry. So it would be very interesting to learn how that has been and how it feels to be one of these top technology companies, preferably if she is a founder of a technology company and see how she leaves and interacts in an industry that only until recently became recognizing female as leader.Stephanie:Yes. That sounds like a good one. I would for sure listen to that. Well, Ivonne, thanks so much for coming on the show. It's been really fun to get a peek into some of your marketing and digital strategies and yeah, it was just really fun feeling like I had a chance to glimpse into the future with you. Where can people find out more about you and Avocados From Mexico?Ivonne:So we, Avocados From Mexico on Twitter is Avos From Mexico and about me, I have the same in Twitter, Instagram, Facebook, LinkedIn is all Ivonne Kinser, I-V-O-N-N-E K-I-N-E-R.Stephanie:Amazing. Thanks so much, Ivonne.Ivonne:Thank you.
03/06/2146m 28s

Reaching Higher Peaks: Lessons from Experiencing 100% YoY Ecommerce Growth with DICK’S Sporting Goods’ Scott Casciato

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.---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---Transcript:Stephanie:Hey everyone and welcome back to Up Next in Commerce, this is your host, Stephanie Postles, ceo@mission.org. Today on the show we have Scott Casciato, vice president of Omni Channel Fulfillment & Athlete Service at DICK'S Sporting Goods. Scott, welcome.Scott:Thanks for having me. It's great to be here.Stephanie:I'm really excited to have you. So I have this deep love of DICK'S Sporting Goods because there was a location in my hometown, eastern shore of Maryland, which I feel no one even knows where that is on a map. But back in high school, I would go almost every week and just kind of peruse through the aisles and look for new lacrosse sticks and shoes. And I didn't really have much money, but I remember just loving the experience and being there probably for three hours with friends, just kind of hanging out. So I was so excited when I saw you guys on the lineup where I was, "Yes, something I know well."Scott:Was that your sport growing up, lacrosse?Stephanie:Lacrosse and soccer.Scott:Nice, nice. That's great.Stephanie:Deep love there. So I'd love to hear a bit about how you got into this industry, because you had a funny quote where you said, "I don't know how I really ended up here," and I'd love to start there, how did you become the vice-president of Omni Channel Fulfillment & Athlete Service at DICK'S Sporting Goods?Scott:It goes back... I spent the early part of my career in software, supply chain software, and kind of even on the sales side, then moved into the operational side and then got into management consulting and did a tour duty in the management consulting ranks. And I got introduced to the founder and co-founder of a company called ModCloth that I was with previously. And they were looking for somebody to run fulfillment and customer service. And I just said, I don't know anything about, I mean, I know supply chain, but I don't really know anything about direct consumer fulfillment at the time. And the founder of that business was, "Yeah, I know, but you're smart enough to figure it out." Right?Scott:So and I have a bent for really high growth, high speed businesses, and it just kind of the way I grew up in my career and that was a really great opportunity. So I did that and I spent five years there scaling that business really significantly, hyper growth phase and it was awesome. I learned a ton about fulfillment and service. And then about five years in, I had this great opportunity to come to DICK'S. And the thing that was really interesting to me is, the question was how can we build a great service organization for DICK'S Sporting Goods? I'm like, "Wow, if I could do it at a much smaller company, what would it be like to come to such a great brand and try to do it here?" And and we did, right?Scott:And so we spent a lot of time building that for the first four years of my time at DICK'S and then had an opportunity to take fulfillment on. So it's interesting that I have some of the aspects of that, that previous role that I had only, a scale that is much larger and just been very, very fortunate to be with such a great business. And it's been awesome to work with the team at DICK'S.Stephanie:Okay. So you are leaving ModCloth, I mean, that's like strictly ecommerce and then you're coming to this, I would say very omni-channel company. I mean, you have over 700 locations across the US, quickly moving to digital, at least over the past couple of years. Tell me a bit about what that transition was like?Scott:I mean, and at the same time we were really building... We were just starting our transformation to building our own technology. So it was a massive... It was basically rebuilding what we had already had from an ecommerce business perspective. And I think fundamentally a lot of the things that I came in and the tools that I had were relevant, right? How you scale a business. I mean, that stuff is somewhat the same. I think one of the biggest changes was or a few of them were one, just having more teammates that knew a lot of stuff that could really help and drive the initiatives and the progress forward, whereas in a much smaller company, right? It's you're wearing so many different hats and you're doing so many different things here.Scott:It was a shock to me to say, oh, there's somebody that can help with reporting or data analytics and help us with these answers. So that was awesome. And then I just think we were all learning, right? So we were learning what we needed. We were learning what we wanted to be in customer service, we were learning what we wanted to have in terms of digital capabilities. We were learning how to run that business as we were deploying new technology, right? So how do you do pricing online appropriately? I remember a lot of conversation. How do you display things? What's the right... How do you check? What's the right checkout flow? And then we had, as all businesses do, you have to make a lot of trade-offs because it may not be the most elegant thing right at the beginning, but we just got to get it up and running, right?Scott:And so having those conversations can be tough, right? Everybody, and especially our business, we just have this DNA where we just relentlessly improve, right? And so it's tough to launch something and know that it's not the perfect solution, right, and then making sure that you go back and you iterate and you keep going, right? We just did that for a long time. But it was a lot of fun and it's really tiring, but it was a lot of fun.Stephanie:So that's amazing. What was one of the maybe projects or things that you felt most strongly about that you got maybe the most pushback on that people are like, nope, that's not a good idea?Scott:I would say, well, we had a lot of conversation about how we were going to set up, for example, in my world, we were going to set up customer service. And we continue to evolve that. I think it wasn't that people were saying it's not how we want to do it, I think it was really more what I was saying about, we want to own more of that customer service experience, right? So we had always been outsourced. And as we moved, as we did the transition, and our previous outsourcer did a great job. And as we move to the next wave of that evolution, we decided we really need to keep an outsourced view in some form or fashion of customer service, but we really wanted to try to start to build our own, right, because we were, "Wonder what we could do on our own?"Scott:So this conversation about, [inaudible] how do you scale for the hockey stick effect that we have at holiday, right, while maintaining the great experience that we have? And we want to in source, but then we want to scale a holiday. We just had a lot of spirited debate about that. So that was part of that conversation.Stephanie:Very cool. And so are you guys kind of now balanced approach when it comes to customer service, depending on what's incoming and how to route it?Scott:Exactly. Right. So we have a team of internal service people that take various types of contacts, and then we have a few outsourced partners that we work extremely closely with. And we balanced the volume across there. And then at holiday time, we scale up across all. And so it's turned out to be... And we're measuring that experience relentlessly. So it's been a great symbiotic relationship, I think, across all three of those.Stephanie:Well, now that you've touched on holiday, I do kind of want to go into peak season and maybe talking about, I mean, you mentioned that you went through this big technology evolution and implementing new things to try and get to where you are now, what did that look like, especially when it comes to preparing for big surges? I mean, I saw your ecommerce I think went up 100% in 2020 or something, so you guys have had massive growth. What did it look like behind the scenes to prepare for that plus peak demand?Scott:I think it's been this... We're very happy that we started when we did, right? when you think about what happened over the past 12 months and what has happened in the ecommerce world and the growth that everybody has seen, we're fortunate that we started four years ago down this path. Because the foundation that we built really allowed us to scale this year really quickly. We've been through all the load tests dynamics that you go through at holiday, we've built the technology stack that can support the traffic that we knew that we were going to get. We've been through the trials and tribulations of how to test, what to test, where to find the failure modes, and we've got really talented people that work on that stuff every day. We've built controls internally to manage where things might not be working appropriately and to be able to balance that.Scott:And as you think about what happened last year, specifically with curbside, it is the example of, it took us four years to become an overnight success type of situation where [inaudible].Stephanie:[inaudible].Scott:Right.Stephanie:[inaudible]. Who knew?Scott:Totally. So I think it was scaling for holiday. We scale every year for holiday. I think last year was one that we didn't quite know, nobody knew what was really going to happen. But I think we over-prepared, and we executed an extremely successful holiday because we just had every... It was so great to see everybody so engaged in solving that challenge and really thinking through every aspect of what might happen in holiday from fulfillment through the web traffic through customer service. And we really came together as a team and figured out all the ways that things could go right and wrong and covered it all. And we had a great holiday season because of it.Stephanie:That's great. So what areas do you think businesses are maybe under-prepared? Is it in the fulfillment piece? Is it in customer service? What are some of the top pillars that you guys covered down on that maybe some people might not be fully prepared for?Scott:I think that we do a great job in measuring and really paying attention to the athlete experience across all measures, right? I think we've pivoted from, I think historically in most businesses have been in a place where you manage internally, right? You're managing things like conversion or traffic or speed to athlete and things like that, and to be the customer, traditional service levels and customer service. I think those are all important, but I think if you take the outside in view, right, and you're looking at things like how are we measuring the experience, what's happening to that customer when they're out there and they're buying from us? But are they buying from us again, right, as an articulation of their commitment to the brand?Scott:And then how do we influence that purchase behavior? And how do you think expansively about that in terms of not only the shopping experience online that they have, but the post-purchase, the delivery experience, the customer service experience, how are you really measuring that data and getting good information and causal information to figure out how you can drive really great lifetime value? And I think we do that and we're really starting to do that really well across our business. And we've gotten so much support for that outside in view, across our leadership team as well that it's become a real engine of thinking across our teams.Stephanie:I mean, it seems like that holistic view is really hard for a lot of companies to get to though. I mean, I hear about a lot of companies trying to consolidate their tech stack, marketing stack, put it all in one area that things actually are connected and you can have attribution and you can see the LTV. How do you guys think about having that view that allows you to make decisions?Scott:I mean, I think that it's philosophical at some level and don't get me wrong, it's hard because I think when you look at the business on a day-to-day basis, all retailers, right, especially those that are public are driving towards hard goals. We take a much longer term view of things generally across the business, which is really refreshing and great. And so it allows us to really make good decisions. When you think about what we're measuring, how we're investing, we're not investing, I mean, obviously we care about the quarter and we care about the year, right? Don't get me wrong, but I think we're making investments that are in the long-term interest of this brand and our customers. I think, we're a really large small business in that regard. And I think we've been able to energize our teammates to deliver that experience on the front line, but also make the investments on the back end of the house that allow us to do that.Stephanie:And I see you guys have been making some big tech investments. I saw, I think Commerce Hub, you did a multi-year deal with them. And I saw something about the vendor partner program that you have. We can kind of plug and play into a bunch of vendors and have an endless aisle. And I was, wow, that could be game changing to be able to pivot quickly and offer, get to the consumer, right, wherever they are, whatever they need, especially in times right now where it's very uncertain. So it seems tech is a big piece of that, towards that investment philosophy right now.Scott:It is.Stephanie:How are you figuring out what you need and how to put the proper pieces in place?Scott:I think we have over 500 vendors in our drop-ship program. And connecting to it has them, and understanding what the inventory is, and getting them to send us the right inventory, and then order information back and forth in real time is incredibly important, which is why we made the investment in Commerce Hub, it has been a great partner for us for a few years now. And it's easy to use. So I think that's that was great for that aspect of our business. I think our vendor relationships are super strong and we're fortunate that we have them because it allows us to be really creative in the way that we go to market. Scott:And I think we're also continuing to build great brands internally, right? And so if you think about, we just recently launched our first brand and it's been a great success so far. It's great stuff. We had got our [inaudible], if you haven't tried it, you should.Stephanie:I haven't. [inaudible].Scott:That's awesome. It's a partnership that we did with Carrie Underwood about six years ago, and it's quickly become our number two selling women's line.Stephanie:Wow. That's awesome.Scott:And then we launched our DSG brand a few years ago, or a year and a half ago, which is really a value-driven brand and with very high quality, right? So when you think about the continuum of our brands, we have very specific and different strategies and they're complex depending on what we're trying to achieve within a given brand or category within that brand. But I think we're fortunate that we've built such great lasting relationships, because again, I think it gets back to, we take a longer term view of things and we really, I think we treat our vendors as partners.Stephanie:Yep. So key, especially in this industry where so much is happening, so much is changing quick and people can get burned really quickly too.Scott:Right, right, right.Stephanie:It also seems being able to plug into a vendor system like that is important, especially around... It seems a lot of companies are doing private label type of things and launching their own brands. I mean, it's not fully reliant now on the big brands and being able to have that flexibility to pull people into your ecosystem that maybe could have never sold at a DICK'S Sporting Goods before, that seems amazing and really allows access in a way that wasn't here maybe five years ago.Scott:It really does. We're always looking for those bets to make with new and upcoming brands. And our vendor director job channel is a great way to sort of test some of these things. So that's definitely, you hit the nail on the head for us. It's a strategy that we actively have and it's nice because my team who manages that part of our business we'll work with our merchants to say, "What could our strategy be with the supplier or partner X?" Right? Some of these folks are small businesses that can't handle our volumes. So if we buy a little bit more, we can test some of them or we can test it in the vendor direct channel. So it's been a real tool for us.Stephanie:Testing's interesting too. I could see kind of doing AB test quickly and see if people like this product and if they like this one more, okay, here's what we're going to go. Maybe we'll circle back with you next year in a much less risky way to bring people in.Scott:We've gotten really good at testing and specifically on the site with how we're thinking about the experience online. And we test almost everything these days, right? I mean, there's some stuff that I think is just go do things, some go do things that we do. But I think generally speaking, we've really developed a muscle around building an experience and testing it and iterating on it to figure out what's really resonating with the athlete most. So everything from shopping experiences on our site all the way down through the conversion funnel to fulfillment, right? And speed and how we're communicating with our athletes.Scott:So I think we've learned so much, and I'm like constantly reminded when we get these, we all kind of make bets, right, when we launched these tests like what do think's going to happen? And I think I'm wrong so often, it's so important to test.Stephanie:Yep.Scott:Good. Because what you think the consumer is going to do they just don't. And even when you think about surveys, I think there's this everybody lies concept, right? And it's true...Stephanie:And depends on what state they're in or where they're at in the day.Scott:Right, right. So I think it's just so invaluable to us.Stephanie:And we do surveys on the show sometimes just to see who do you want on, and how am I doing? And it's, well, it's depends on probably where that person is, if they're happy, if they're sad, it could be different depending on the place that they're in.Scott:For sure.Stephanie:So what's an example of a test that you ran where you were so sure, you're like this one's going to win, everyone was kind of on board with one scenario winning and then the results come back and everyone's wrong?Scott:That's a good question. We just ran one recently that I did win on, which is the one that was top of mind for me coming into this. Let me talk about that one for a second. So the one we launched on same-day, we're trying to figure out what are our athletes appetite is for same-day services. And we did definitely get a lot of engagement on the test. I kind of thought it was going to be more than it was, but it was still interesting, right? So I think that's something that we're going to continue to have conversation on.Stephanie:They wanted it, the majority of the [inaudible]?Scott:I think they did. It wasn't as much as I would've thought, really.Stephanie:Because that's an interesting one that some people on the show said, people just want to know when it's getting there, they're okay if it's not same day, versus if it's more of a commodity product, you better get it to them the same day. And to kind of seems it depends what it is and how much delayed gratification someone can have on it, it depends, it seems.Scott:Yeah. Some of the tests that I think that we've run that have been less intuitive, I just think how products are set up on the site and how people search, right, and find products like you would think that sometimes when you put the best or most visible sort of notable product of the top search results, that's going to create a better conversion and sometimes it just doesn't, right? So it's really people come in I think with a lot of intent around how they're shopping and sometimes what you think is going to happen just doesn't because I think there's so many different ways that people shop.Stephanie:Yep. How do you think about shifting the website either, from what you learned from last year or when you're approaching peak season, are there certain key elements that you adjust knowing that maybe the consumer's are in a very different mindset than they were at any other time in history probably?Scott:Yeah. I think I can speak more to the way that we think about fulfillment in this regard. I always, I historically had thought, that's another example of what I thought was going to happen. I historically thought that during, for example, Black Friday weekend speed was really important, right? I need it, I want to get it fast. And it turns out that weekend in particular speed is not the most important, getting what you want is the most important, right? So getting the deal is the most important. I think it makes sense because most people are thinking, I've got three or four weeks that this thing can get to me. I'm not super concerned to get it next week, just to make sure that I get it, right?Scott:So that's one that we adjust in terms of making sure that we're really being honest with how we're going to fulfill. Thankfully we've got an extraordinarily resilient fulfillment network and we do really well in speed and but historically had been surprised as we've really measured that one over Black Friday weekend. It's really about getting the deal, not the speed.Stephanie:Versus Christmas when everyone's probably last minute shopping, it's probably opposite.Scott:Very different.Stephanie:Okay.Scott:Very different. And as you get into December and you get through towards the ground cutoffs and you get, depending on what's happening, the speed becomes a real issue. Last year was was nuts. I mean, FedEx was running commercials, right? They talked about the speed or buy early. And we definitely saw a little bit of a shift in terms of how people were thinking about buying.Stephanie:So how are you building up that resilience fulfillment network that you mentioned to be able to basically say I can offer anyone the endless aisle, we have unlimited of these, in one moment and then be, okay, now next month got to go, got to be there in three days or less type of scenario?Scott:I think you mentioned it when we kicked off the show, it was we've got over 700 fulfillment locations when you think about our store network, which is a blessing for us because it allows us to really, not only be closer to our athlete and get things there faster, but also allows for a lot of flexibility when... It's just load balancing, right? When you think about a business that has a couple of three, in my past one fulfillment center, when that thing gets backed up, or you have a labor problem or you have whatever the case, would be trucks that don't show up on the receiving dock or the outgoing dock, you're kind of backed up, right?.Scott:And so while that definitely happens across everybody's network, including ours, having all of these different nodes that are moving product out each and every really helps mitigate the risk. And so it also helps us, at peak time, it helps us staff up and get stuff out. And we have we've built a really sophisticated way to manage the way that orders are routing. So we're able to identify where we might have congestion points, for example, and try to proactively avoid those as we see those things happening, right? So we can move orders to one node or another, or block a node if we've got a weather issue or something, or we've got, in the fall when you have hurricanes in Florida, right, or in the Southeast, we're able to really change the way that our orders route to get product out of different places that aren't having those issues.Stephanie:And is that kind of done in the background where it's looking at all these different inputs and then kind of making decisions that you can come in and adjust if you need to, but it's already routing it for you in the background?Scott:Yeah. So part of it's automated part of it's people, right? And it's still a lot of people, right, washing the switches each day. But we've got a great team of people that are communicating, we're communicating out of our stores to my team and fulfillment. We're communicating from my team into stores and we're using the technology that we've built to really manage the capacity and the inventory across the entire network.Stephanie:It seems that is so important too you when you essentially have two business units when it comes to fulfillment, you've got your store locations with one set of data, inventory is probably very hard to track because it's always getting grabbed, it's always getting shipped out, and then you have just maybe a fulfilment center that's a whole different beast probably. How do you get to that consolidate view? Is that part of the backend tech that's kind of looking at it at a higher level, treating it all as one?Scott:It is and it's definitely complex for the reasons that you noted. And it creates, sometimes it can compromise how close we can get to the athlete if we think we've got a unit in Austin, Texas and we actually don't. The fortunate part is instead of canceling that order on you or that unit on you, it's going to go to maybe it'll go to a Dallas store, right? And we can still stay pretty close to you and get it to you. And we're also trying to look at things like, how do we keep packages together? Of course, anybody that's listening to this that manages freight will say, yep, really important from a cost perspective. And frankly, even from, as I mentioned earlier, that athlete experience, people want to get one box, right? I don't want to order three or four different things and get three or four different boxes. And sometimes that's unavoidable, but we're trying everything we can to not let that happen.Stephanie:Oh, blessing.Scott:Totally, right?Stephanie:I get, one company I'm not going to mention their name, they will send a can of soup, anything a bone broth. I mean, it's in these little bags and they just come one at a time. I'm like, "Oh my gosh, I just would have rather just gone to the store and picked it up myself than getting random of one item at a time."Scott:It's so wonderful when the customer experience need and the business need align, right? So when you think about, nobody wants to ship more packages to you, right? We want to get it to you, we want to get to you fast and we want to get it to you in one package. And that's also a great experience for you. It's the same thing we talk about with customer service, which is a traditional metric that people manage as average handle time, right? How long are [inaudible]? And I'm so careful, we collectively are so careful with this metric because it can be so disastrous to the teammate that's on the other end of the phone if they think they're being managed to a handle time, right? I don't want to just get you off the phone, however, and you need to use it for all kinds of different scheduling and making sure you have enough people on the team.Scott:But what's really aligned is generally people want to get to an answer pretty quickly also, right? I want to have an efficient, valuable use of my time. I want to get to an answer and then I want to move on with my day. So that's another example of where if we can do it right and align those desires, we're going to create an awesome experience.Stephanie:The unintended consequences, pizzas is such a tricky thing with thinking about designing roles and KPIs. I mean, I'm doing it right now. I'm thinking about sales and building a sales team and being like, oh wait, this might incentivize bad behavior.Scott:You got to really think about it, right?Stephanie:You just think really strategically about it.Scott:The outcome or the impact is very different than the intent in some cases.Stephanie:Yep. Are there any external inputs right now that you think companies aren't preparing for? I'm thinking about the algorithms that are kind of running everything behind the scenes when it comes to your fulfillment and things like that. Is there anything that you guys are watching now that maybe you weren't watching a couple of years ago and letting it help influence how things are routed or how things are kind of being redirected, anything like that?Scott:I mean, I think we're constantly trying to get to be more precise, and we're very fortunate that if everything goes right, we can get you an order really, really quickly. So we're really trying to pay attention to, where are things not going perfectly and we've called this thing the perfect order, what's our perfect order, right? And how do we get more of those? So we're spending a lot of time thinking about how we can perfect our fulfillment network. And I mean, it is, as you can imagine, just an infinite number of variables that dictate how this thing goes. But we're working a lot on that. I do not think that...Stephanie:[inaudible] like local stuff, because that's something that kind of came to mind. You're paying attention to weather and higher level things are you down in the weeds of, okay, well there's a festival this week here so that means... Is it that [inaudible].Scott:It can be. I mean, for example, when we're doing a hot market event, so Super Bowl, NCAA Tournament, they're national events, but their inventories largely local, right? So we're really paying attention to what the traffic is doing and the inventory is doing it at those local levels for sure.Stephanie:I'd love to talk about events a bit because I know that's a focus is the athlete experience online and in person as well. And I saw that you guys are opening more retail locations. You're opening, I think I saw a golf center, I soccer center, I mean, these full on experiences. And I'd love to hear how you guys are thinking about that.Scott:I'm glad you mentioned that we're really proud. We just opened recently the House of Sport up in Victor, New York, which is an expression of what we think the future can be for DICK'S Sporting Goods. And it's really an experiential retail location. So you can go in there, obviously we've got golf simulators and we've got fitting in there. We've got rock walls to climb. We've got an outdoor fitness field where we're doing things and we're engaging the community in different ways. So we're running clinics and figuring out how we can get local teams into their... Engaging in the community in this way has been a part of our brand since 1948, right? So I think, if you read the story of DICK'S and how we were involved in the Binghamton New York community, when the business was founded, it'll give you a sense for why this is important to us.Scott:And we just believe that, we say it all the time, we believe that sports makes people better. So how do we think about engaging in the community where we're at? We've done this forever in community marketing, and you see how we donate equipment to local teams and so forth. This is kind of another evolution of that, where we think we can make a big impact, we can change the way that people think about retail. And I think it'll quickly get to how do we merge the online and the brick and mortar or traditional retail experience? So I think that's a place that is really exciting to us right now.Stephanie:I was just thinking about, how do you create, you have a view where you know this person came in to this event and they were using the golf simulator, and they really liked this club. And then they either bought in store or maybe four weeks later they ended up online and bought the one that they were using? Do you feel you're moving in a direction where you're going to have that viewpoint? And it's not a hard time to get there.Scott:Yeah, I think we're getting there. I think we're really focused on data and analytics, right? And so I think our ability to stitch together these experiences, we're building that muscle. I don't think that we're totally there yet, but we've got really smart people that are thinking about this. And I think we're moving in that direction because that's the key. We're not really worried about what channel you buy in, right? I think it's more about, are we the retailer of choice for you, right? And however that experience, the experience that we can build for that, it's important to measure it because then I think it unlocks the investment in the targeted areas that are going to drive more of that for our athletes. So I think that's where we're really focused.Stephanie:Have you thought about creating essentially kind of a guide shop, but you have the soccer experience or something, and then just a small shop where maybe you can look at a few other things, but then essentially you're going back online to order whatever you played with and got to experiment with, or are you doing full on retail location as always, and then often this area we're doing our experience center?Scott:We haven't done really pop up experiences, guide shop experiences like that. We're moving more towards, how do we create a more scaled experiential experience in store and then how do we measure that in terms of who might go online to buy.Stephanie:Mm-hmm (affirmative). I love that. I'm excited to see... I need to visit one of those stores, especially the soccer one. I mean, I don't know what it's going to be happening there, but I want to be there.Stephanie:I want to hear, which I feel you'll have a great answer for is what are you all most excited about right now over the next one to two years? What are you most passionate about?Scott:We're excited about a lot of things. And as usual, we have a very full plate. So I think things that we've already deployed that we'll continue to refine, things like our curbside program or a buy and pickup in store program for online, we're really excited about that. That's got a long runway of improvement, enhancement, and creativity that's going to be placed into that program. We are really excited about this merger of... I'm really excited about the merger of stores and online specifically around becoming a trusted advisor to our athletes. So if you think about the breadth of the teammates that we have, and when you walk into our stores or you talk to our people online, everybody's got a passion, right? Your passion is lacrosse and soccer.Stephanie:Mm-hmm (affirmative).Scott:How do we think about unlocking that potential, right, in terms of then being able to help our customer, whether that customer is buying first player pair of soccer cleats for their son, to getting ready to play club soccer, to getting ready to go off and play soccer at a D1 level or beyond, right? So how do we look at that continuum of expertise and really become that trusted advisor, both online and in our stores? And I think that is incredibly exciting venture. And we do it well today. I think there's an opportunity to do it even better. So we're really excited about that. We're really excited about the assortment, right, that we're going to continue to launch online. I think it's going to be differentiated. I think it's going to keep our position in the market really strong.Scott:So I think the product that we put in there, the expertise that we put in there is going to be differentiated in the market, right? And that I think is probably more incremental and more incremental expression to the core business. And then we're going to continue to press. Game Changer has been a great business for us for years. And that team is great. And they continue to build a technology that service the baseball market. But we're always looking for different ways that we can expand or innovate across the industry.Stephanie:I love that, you know what? We need like, what do you do after college? I always think about that and I'm like, I loved playing sports. But then you start working, and then you have kids, and then you're, I still want to play, but how do I get back into it? And something is missing there, Scott. [inaudible].Scott:No, but I love... So that's who we want. That's another sort of persona that we really want to love to serve in our stores. Because I'm one of them.Stephanie:I'm your person.Scott:Right.Stephanie:We're the people.Scott:We're the people. And I think what we want to be able to do, I love talking about this. I think in our stores and online, our ability to listen and inspire, right, how do we help you meet that goal, right? "Hey, I'm doing a couch to 5k first time. I'm starting to get active." Or, for me, the 5'8 guy that always had a dream of the NBA that never came to fruition because my vertical is about that high. I still play. I want to make sure that I can get all the gear that I need to be competitive, right, or to achieve my personal best.Scott:So I love the fact that we can really positively impact people's lives in that way. And I think we want to make... I would love to make sure personally that anybody that walks into our store and knows that we're not just a sporting goods retailer, right? I think we want to make sure that we're helping, we want to facilitate you achieving your dreams. And then we talk a lot about that internally. So if we can translate or transmit that feeling to our athletes, I think that's really powerful.Stephanie:And also makes me think about creating custom leagues too, where it's, this is a different kind of league. It's not the traditional school. It's not even people creating their own volleyball leagues. It's we are a part of this. We're making sure that this can happen for people who struggle to even find those networks. I mean, I know back when I was in DC, I looked for where's some other women who play lacrosse? I don't really want to play with guys who are going to be checking me and I count find it, super hard to find. I mean, it's easy to find some sports in a community setting, but it's very hard to find people in certain other sports settings.Scott:You're right. There's a social, I don't want to, careful to say social network, but there is this idea of how do I plug into people that are me within a certain geographical area, right? That would be interesting. That's really interesting. Thanks for that one. Let me...Stephanie:Take it back to leadership. We just need a parenting kit. It's, here's everything you need so that we can go play our sports and then your kids are entertained. They get many lacrosse sticks. You go there and then I'll go off on my own so I can actually play, give me the kid.Scott:I love that idea.Stephanie:I want to think like such parents. Anyone who's not a parent is probably, "What are y'all talking about right now?"Scott:What are you talking about? Yep.Stephanie:Yep. All right. So let's shift over to the lightning round. Lightning round is brought to you by Salesforce Commerce Cloud. This is where I ask a question and you have a minute or less to answer. Are you ready?Scott:I think so.Stephanie:Okay. So I'm sad, I haven't asked this yet and don't know this, but what is your favorite sport?Scott:Basketball.Stephanie:Oh, nice.Stephanie:And who's your favorite sports team?Scott:It's always been the Chicago Bulls since back in the day, which is probably blasted me because I live in Pittsburgh. So to not say football and the Pittsburgh Steelers is a problem.Stephanie:You'd probably get egged.Scott:Probably. But they're close second.Stephanie:That's good. What is the nicest thing anyone's done for you?Scott:Oh, wow. I'm going to struggle. I'm going to go to my kids. I think my kids being, this is going to sound so cheesy, but it's so serious. The way that my kids treat other people with respect and kindness, I think is the thing that comes to mind for me first. And I know that's probably not the answer that you would normally get.Stephanie:Nope, I like it.Scott:To me that's pretty important. So I'm really proud of them. And I think that's probably the best thing that somebody could do for me.Stephanie:I love that. There's so much you can learn from kids. I think about that all the time. So I'm the person who is here for those cheesy kind of kid answers. You're in the right space. What's one thing you don't know that you wish you understood better?Scott:American history comes to mind?Stephanie:That's a good one.Scott:I don't think that's on topic, but that's the first one that comes to mind.Stephanie:When you want to feel more joy, what do you do?Scott:It's going to sound crazy. I tell people, thank you.Stephanie:Mm-hmm (affirmative).Scott:Right. So I just believe that there's a lot... I get a lot of energy from being grateful, right? And so that's what I do. If I'm really feeling a little down or if I'm really stressed or some of the times the way that I work out and I get the endorphins mode going, that's one way to do it, and the other way is to be grateful for things. So I feel that's the way I get a lot of energy.Stephanie:I love that. All right. And then the last one, I mean, it seems you guys are very much ahead on a lot of things within the ecosystem. What do you do to stay on top of the trends? Are you watching other companies? Are you reading things, what are you doing to stay on top?Scott:I think it's a combination of experiencing and reading. I don't read nearly enough, it's hard, right? There's so much the content that comes out and not enough time. So I'm trying to just experience things out in the wild right? I'm talking to a lot of people, whether it's parents at a game or if it's just my own experiences online, and I'm trying to translate that to what's happening and why companies would do things a certain way. And then my team is doing the same thing. So I think we're trying to stay close. We're trying to stay close that way and certainly reading and engaging in conversations like this also kind of help.Stephanie:Good. That's awesome. Well, cool. Well, Scott, thank you so much for joining us. It was really fun to hear all about what you guys are up to. Where can people find more about DICK'S Sporting Goods and find you?Scott:I think www.dickssportinggoods.com. For the story of Public Lands and Golf Galaxy, and you can find me at LinkedIn, on LinkedIn.Stephanie:Amazing. Thank you so much.Scott:Thank you so much for having me. It's been a great time.
01/06/2141m 11s

An Ecommerce Strategy (and Product) To Make You Feel Good

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.---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---Transcript:Stephanie:Hey, everyone and welcome back to Up Next In Commerce. This is your host, Stephanie Postles, CEO at mission.org. Today on the show we have Chris Bernard, the co-founder and CEO and Chief Mood Officer at Mindright. Chris, welcome to the show.Chris:Thank you for having me. Appreciate it.Stephanie:It's good to have you. Would you rather have me call you Bernie? Which one do you want?Chris:My friends and my coworkers call me Bernie, but whatever you're comfortable with.Stephanie:I'm your friend.Chris:Okay, call me Bernie.Stephanie:All right. I like it. So in the beginning, I like to always hear about your background, your journey and how you got to Mindright. So maybe if we could start there. What did you do before Mindright, we'd like to hear.Chris:What I did before Mindright was I was in action sports for a little over 15 years. I represented brands like Burton Snowboards in their sales and marketing channels as an independent contractor. I left that business in 2015 and I invested in a company called, Buff Bake which was protein snacks and protein cookies, nut butters and I came on board with them as part of that investment as the CEO and I helped them run that company for a few years until I was ready to try something new and had an idea and ended up launching this Mindright.Stephanie:So did you have the idea for Mindright right after Buff Bake or was there something in between there?Chris:It was something in between and it just evolved very quickly into what it is today.Stephanie:Okay. What was your original idea? And then what is it today?Chris:Vegan cookie dough.Stephanie:Well that sounds good. I dig that.Chris:It was okay. It wasn't great and that's why I kept it out of the vine and I think we'll probably get into it. But one of the things that dismissed the idea was it really for me, I was looking for something condition specific. Functional foods are really driving the category right now and it's all about condition specific. Foods that drive beauty from within, through collagen, immune support, sleep support.Chris:It's really how we came to Mindright. We started to see this trend in supplements and when you're looking for trends that are going to be shifting to food and beverage, you always start with supplements and you see this rise of adaptogens and nootropics and brain supplements and anti-aging and it's just skyrocketing growth in supplements. It was this idea of how do we support our lifestyle through our mindset, our long hours, our drive, our energy levels through ingredients that support cognitive function. And that's where we started was this idea of cognitive food support and I came to my partner with this idea, he absolutely loved it. At the time the working name was Feed Your Brain.Stephanie:Cool. I like that name.Chris:And it was just really focused on brain health.Stephanie:Do you have a background in this world? How would you even know? When I'm thinking about brain health, I'm like, "Feels like there's so many things. I should be doing facial or I should be doing this. I should be doing so many things." Did you have a background in this where you already knew this makes me feel good? Or did you have to learn all about it?Chris:No, I just knew I wasn't feeling good. I always feel this brain fog and slow and besides this fact that you just hit 40, things start to slow down a little bit and you're looking for ways to support your lifestyle and just keep your edge and just keep moving forward and you start researching and there's a lot of great information around brain health, mental wellbeing, nutrition and other things that support those functions.Stephanie:Okay. And so what were some of the ingredients that you started finding that you're like, "We need to have this in some kind of bar."Chris:It was like lion's mane, Gingko biloba, both of which didn't make the cut at the end.Stephanie:Oh, how come?Chris:Well this is where I was going was, as we started with Brain Health, my partner who is a very big advocate of testing and research pushed to really go out and survey a group around 350 people. And while cognitive function was important to them, what indexed the highest was, "Do you have foods and ingredients that help me feel good? Happy, good mood. I want to be focused and feeling good." And this theme of feel good, just kept popping up and popping up and we took a step back and it was indexed so high. Like, "Why don't we just lean into good mood?" We've got a set of ingredients. We've got some data behind some of the ingredients we're using to really support enhancing your mood, decreasing your stress and giving you energy. All the things you need to feel good. So we need to do it. And that's how Good Mood Superfood was born.Stephanie:Cool. And did you always know that it would turn into a bar or did you have other thoughts early on?Chris:We had many thoughts and we still have many thoughts. This was our way of really standing up the brand, getting a feel for our branding, our message, bars is just the starting point. We have a really dynamic innovation pipeline of other snacks, drink blends, hydration drink. Things that will help support other areas of brain health.Stephanie:Very cool. So let's talk a bit about your partner and how that working relationship is and how you even landed him as your partner.Chris:So I was introduced to Rob Dyrdek, legendary TV personality, former skateboard, a professional athlete. Rob has a show on MTV right now called Ridiculousness. I grew up watching his other shows, Rob & Big and Fantasy Factory, as many of us did.Stephanie:Rob & Big, that's a good show.Chris:It was amazing. So then we just look forward to every week watching. He's just such a character and dynamic human being. But what people don't know is he runs a really diverse, exciting venture creation studio. He refers to himself and the people around him as do or diers, people that are interested in investing in themselves, growing businesses from the idea stage to the exit. And he's invested in several brands, primarily at the startup stage. And when I came to him, I was in the transition period in my life. I didn't know why I was meeting him.Chris:I was going to go in and just introduce myself. And I brought Buff Bake with me just in case he was interested in investing because always looking for investors and he made me tell him my life story from the day I was born until the day I ended up sitting in the chair in front of him.Stephanie:Wow. I should have done that.Chris:It's not that interesting. But he really liked it. And I spent 55 of my 60 minutes talking about myself and then he's like, "Okay. So what's up with these cookies? What's up with this Buff Bake? He's like, "Okay. Those are really good. I like them but I really like you. If you have some ideas or you want to do something, come back and let's talk about it."Chris:I left and I got a call two weeks later from him, wanted me to come back again. Again, didn't really know why I was going there. He wanted to pitch me on some ideas. And it just flew over my head. I went home, I called his COO and I was like, "What's he looking for?" He wanted an idea from me. He wanted to work on something. So I had been in the background working on these cognitive ingredients, paired with superfoods and brought it back to him as a whole package. I came in with fully developed samples around bars and coffee creamers and bites to really articulate what this could look like. And he was so excited about the presentation. He just sealed the deal with me on the spot and we were off to the races.Stephanie:That's amazing. What does the partnership look like with him? How's he involved?Chris:He is very, very involved. He wants to be very involved in the creative process, but also through all the funding, the financial rounds, building the infrastructure of the company. He has built a really strong team around him. Managing the finance arm, managing the marketing project teams. So it's an extension of my team. We are true co-founders, he's very, very involved in the business and he and I are either working together on the daily basis or he and his team are fully integrated in.Stephanie:That's really cool. And it seems like once you get access to him and then you had his network, it brings in other investors as well.Chris:Yeah. So that's the next thing that happened. So we stand this thing up and we start to go out to bring in some strategic capital to help push things along. We started with some traditional resources and private equity and some strategics within the space. And then we started talking to his network a little bit and all of a sudden we saw how excited they were and one conversation led to the next, led to the next, the next thing you know it's Marcus Lemonus from the profits. Jonas was extremely excited about the project. He now sits on the board with myself and Rob. Joe brought his brothers on as well. Jordan McGraw, Travis Barker, Ken Roxanne. It's just this star-studded list of really great mindset celebrities and athletes. Very, very exciting.Stephanie:It seems like you have your own portfolio of influencers. You can get the word out there. While most people you're trying to even think about, "How do I even tap into one of those?" You've got this whole little Rolodex just working for you.Chris:Right. So it's exciting. I think that being able to have that leverage and that advantage really puts us in a unique position to tell the story.Stephanie:Awesome. So tell me a bit about, you said that you were getting samples when you were going to go and show him what you could do. What did that process look like? Because to me thinking about even making any kind of food and then getting the packaging and then getting ingredients that maybe some people aren't the most comfortable with. If you hear some of the words you'd be like, "Well, what is that like? Is that even safe?" Tell me what that process looked like to even find someone who could make the bar that you wanted to taste good and have all that ready for the sample day.Chris:It's funny. You start with the manufacturers. Every manufacturer has a food scientist, R&D, most of them do. Food scientists and R&D department. And most of the time, if they're excited about your project, they will help your R&D. It comes with strings attached and not always do you end up owning your IP, which is important if you're interested in exiting your company at some point, but you learn the process of what goes into R&D products.Chris:And I came in, you come in with a brief and your core tenants for, "These are the ingredients that I would like to use as superfoods. These are the outputs that we'd like to achieve, enhance mood, stress, energy. These are the functional ingredients we're thinking about." And then you work with the ingredient suppliers to understand efficacy and transparency around their ingredients. And you let these guys do their job and you like what you like and you don't when you don't. And I think we did about 13 rounds of this bar until we landed in a place that we felt really good about.Stephanie:That wasn't just you testing it or were there other people trying it?Chris:It was Rob and the entire team. His close team is a team of five.Stephanie:That is awesome. What kind of lessons did you learn when going through that process? Anything that you would maybe do different?Chris:Well, I'll tell you one thing. We tried to be everything but the kitchen sink. We wanted to be keto, we wanted to be paleo, we wanted to be zero sugar. We wanted to be everything. Vegan, dairy-free, gluten-free and have functional ingredients that support incredible, feel, good vibes and decrease your stress. And we were realistic that not all of that was going to work and our guiding light really became taste. If it doesn't taste good, I don't care if it has all those things, it's just not going to work for us. So we planted a flag and it was about taste. And we want this thing that tastes good. And if it has five or six or seven grams of sugar, we use a coconut Palm sugar, which we felt really good about. It was therapeutic. It was like, "Okay, great. We don't have to use sugar, alcohol, or stevia or erythritol or anything. We're going to use coconut Palm sugar. It's a low-glycemic sugar. It tastes great. The bar still has 50% less sugar than an RXBAR or competitor. And we felt really great about that.Stephanie:That's awesome. How do you view the landscape right now? Because I know when I go into certain grocery stores, I'm like, "Wow, there's so many bars." There's the original type RXBARS but now it feels like there's so many offshoots. Everyone's trying to do lower sugar. Maybe not what you're doing, but how do you make sure that you're staying ahead of them and also differentiating yourself where people are like, "Oh, obviously we can see why they're different than all these other bars."Chris:I think again, it came down to taste, great amount of protein, our base values of, it is plant-based vegan, it is dairy free, it is protein packed and low sugar were really important to us. But I think we'll continue to stand out with what our functional message around supporting mood through these super foods and ingredients. And we are just sticking with that.Stephanie:How do you get in front of new people though? I'm thinking about back in the day, samples where you're like, "Oh, I would never have thought to buy that, but now I can see it's healthy for me and good." How do you approach that now trying to get in front of new people and have them try it for the first time?Chris:It's difficult, especially through a global pandemic of people at home and not having opportunities sample in the markets or elsewhere. And for us, it's just leaning into our influencers, our investment community, paid ads, really important. Finding unique ways to drive trial, pinpointing and targeting specific communities. It'd be really great to be everything to everyone but if we could just focus on this core group that's committed to their mindset. They're coaches, they're hustlers, they're the boss, they're the mom and they're focused on what it takes for them to be successful every day. We call them the happy hustlers. That's where we're starting. Our initial reaction was the right one. They're really resonating with the product. They're speaking about the product for us organically. And we're just going to continue to focus on that community right now. And then it'll just hopefully grow from there.Stephanie:It also seems like you have a really good idea around your social presence and how you want to present yourself. It's like a fun whimsical looking, at least your Instagram feed and it's not overly product driven, but it's more selling the lifestyle behind it which I really liked.Chris:Exactly. That's exactly right. And that's what's resonated the most is people are realizing that Mindright is a lifestyle. It's not just about the products. We want to support you beyond that. And as you'll see over the next couple months, we're really going to lean into what it takes to have a better mood, to put the work into your mental wellbeing and really drive home this good mood movement. And being approachable and fun, makes it just easier to pay attention and watch and fun and funny is part of feeling good. And that's the message that we want out there.Stephanie:It sounds like your content strategy you're about to ramp up around those areas. How are you going to keep it balanced between educational, which I feel like a lot of people need education around the ingredients and why they're added and how they need to be mixed together and then the other side around even outside of the product. Like you said, just good mood and how to feel happy and mindfulness and it's like a whole different business over there. How are you thinking about balancing that and connecting with the right audience?Chris:It's just that. It's balancing, trying different things. It's balancing being funny with incorporating lifestyle and people enjoying the product. You're going to just start to see more direct response and testimonials. We are looking to partner with therapy based apps and other entities that help make mental health and wellness really accessible. We're going to have our investment team and our influencers talking about the work that it takes to get Mindright. It's not just, this bar is not going to solve your problems, it's not. But if you focus on your nutrition and you incorporate things like the importance of sleep and getting exercise and some type of a meditation routine, all of these things combined bring you to that next place.Stephanie:Yep. Yeah. It's not just try one thing and all of a sudden everything will be solved, like many things and there's no magic potion.Chris:I think that that's where other companies that are trying, mood or all of these other cognitive functional ingredients, they could fall short because they're making it just about that. And I think that we'll go along for the ride and we'll be there to support our customers along the way.Stephanie:That's great. So you just mentioned influencers. I'm going to go and I want to hear how you view working with influencers because we've had quite a few brands on the show and they talked about it. Some people, amazing experiences if you find the right person who is all in, it's not just sharing a quick message of like, "Here's my teeth whitener and it works great for me go buy it." Versus maybe the ones that are really in they're even part the product development. How do you view a good working relationship with influencers? And more than one, since you have many that you have to balance.Chris:I think for us, it's about being authentic. If it's not something you enjoy and you truly believe in it comes through. You see it and you feel it. And I think having our influencers part of our ambassador program, which we're just at the early stages of building out, is a really important part around building the authenticity of their message. Our influencer program is very small right now, we're still identifying how they're speaking about the brand and what are the best ways to do that. But what we've gotten so far comes from a really organic place. We haven't paid for any influencers yet. All organic because people are enjoying the product and sharing the message with their community.Stephanie:Are you sending them free samples or is it more your investors giving it to their friends who are other influencers probably. And then it's organically happening through that way?Chris:A little bit of both. We identified people that live within our community that we would like to target and say, "Hey, we'd love your feedback. No expectations. You don't need to post. We just ask you tell us how you enjoyed the product. How'd you feel? What do you think about the packaging?" And then it just happens organically.Stephanie:How do you view the longterm strategy around influencers? Because sometimes it feels like they'll have this excitement and a big blip where their network sees it. And then there's maybe diminishing returns and people are either hit over the head with it too much. Or like, "I bought it. It's good." Or the person's not as excited anymore as they were maybe in month one. How do you keep them engaged or be like, "Okay. We're kind of good for now."Chris:We see that fatigue all the time. And I think for us, it's the excitement around what's coming. It's creating community around the lifestyle and the future launch of our new products. The bar is here today. It might not be here in three years from now. It's about continuing to evolve and supporting our needs today.Stephanie:Makes sense. So tell me a bit more about this ambassador program that you're building.Chris:We're at the early stages where we're leaning into this mindset community from happy hustlers. We have three investors on the team that live and breathe in that space. And that's Chris and Lori Harder, their lifestyle coaches and then Lewis Howes who also has a podcast, The School of Greatness. And just really leaning into what they do and how they do it and their communities coming to us and we're setting them up and they're incentivized by product. One of the angles that we're working on right now is charity. When they post, we will support a soon to be identified a mental health charity with an investment.Stephanie:When they're posting about the bar or the company, something like that, then it's like, "Okay, that's a point towards this charity or effect."Chris:Exactly. Those are the early stages. We're still in development. It's still being worked out. We're less than two months old in the market, so we're close.Stephanie:Are there other ambassador programs that you look at where you're maybe taking some key learnings from where you're like, "I know this one works well and I want to implement some of those strategies into Mindright as well."Chris:Yes. A lot of them are custom built though. There's a lot of really great app solutions that work really well and incentivize through product or discount or payment. We want to try to be more organic. I've seen some great custom ones that are gamified, that built community around this excitement around this app itself and the message. So work in progress.Stephanie:That'd be cool to circle back and hear what you ended up building and how it's working and the results. So tell me about your distribution strategy and where you're thinking about selling. Are you on Amazon? Is it just your website and how do you think about where you actually want your bars to be sold right now?Chris:It's everything digitally native. So we are alive on our website getmindright.com. We're on Amazon. We're looking at a various array of subscription box companies. But the really big one right now is all of the delivery convenience guys. So this new evolution of convenience, prime is not good enough. It can't be there the next day. It needs to be there in 20 minutes. So we're looking at partnerships with goPuff, FastAF, Dot. We're in the process of vetting those guys out right now and seeing which one makes the most sense. And I think that can meet format. It's just growing and exploding right now. Through COVID people were forced to adapt to Amazon and delivery service and it's here to stay. It's here to stay. Those conveniences will never change.Stephanie:Are you worried about maybe your brand and the story not being told correctly when you're starting to have many outlets for your products going out and you can't fully control the messaging or?Chris:Yeah. I think that's why picking the right partner for these delivery services is key because we want to make sure that we have the ability to tell a story, whether it's this big or in a banner. It's really partnering with the right team to help make that happen. And then we have a lot of work to do on our end. And I think that our community will help push people to these services. Amazon, getmindright, goPuff, that's where we go and they'll really rely on on that. It's challenging.Stephanie:Yeah, no. Especially when you have so many different people you're vetting right now and thinking about all of the control that you could be losing but also all the access that you're going to be gaining. It's tricky. Because this is a commerce show, I want to hear about your ecommerce strategy around what's working. What do you think that you're doing on your website that maybe is unique and others haven't tried out yet or that you're like, "This is a good tip that more people need to know about."Chris:I think it being less templated and more just an experience where it just feels fun. It makes you dive a little bit deeper to find out what's going on. What works for some people doesn't always work for others and I think this format is working well for us right now.Stephanie:Do you find yourself being able to look back at maybe your experiences at Burton and other places and pulling some lessons from there? Or is it such a different market that you're like, "That probably wouldn't work for this product."Chris:I think it's very similar. I think at the end of the day, you're selling an item that you're passionate and excited about and what is the best way to share that with your friends or your customers? It's very similar in that sense.Stephanie:Yeah. That's cool. So where do you guys want to be in one to three years? What are you hoping to achieve?Chris:We're looking to achieve this just amazing platform of good mood foods that span across really great retailers, Whole Foods, all the natural channels. It would be really great to see it everywhere obviously, but this really accessible approach to foods that help support your mood.Stephanie:Have you started talking to Whole Foods and other retailers like that?Chris:We've had some early conversations, but we really want to stay firm on this digitally native approach. I think that one thing that I'll add is testing is worth spending money on. Just test landing pages, AB testing, digital testing, customer testing. It has opened my eyes to this completely different world. And it is a true science. And when you understand that word that works, that picture that works, that landing page that just converted, it's a science. And then you can continue to really invest towards those things that are working because you know there's turn on that.Stephanie:Yeah. I agree. What is a finding that maybe came out of some of those tests where you were like, "We would have never changed this, changed the product, change the website, but now that so many people are saying this, we're definitely moving forward with that.Chris:I would go back to the beginning where Rob and I, Mindright. There was two different names before Mindright. And now I look back, I'm like, "Neither of those would have worked. Mindright should have always been number one." We tested Mindright. Mindright worked really well but We wanted to brand the ingredients themselves. And we were like the unstoppable blend. We're unstoppable. This mentality of you cannot be stopped, masculine. And we were so sure of it and it failed miserably.Stephanie:They were like, "I don't like that."Chris:No, no. So now at the happy brain blend.Stephanie:That makes me feel happy. That's more on brand.Chris:Yeah. And then from that moment on we're like, "That's our guiding light." It makes me feel happy. Does it? Yes Or no. Okay. It's in.Stephanie:And how are you doing these tests? How are you going about trying to get this feedback? Are they surveys or what are you all doing behind the scenes?Chris:Yeah. Surveys. Right now, we've moved to more surveys. We're surveying around our current database of growing email subscriptions and then we're going to start doing some stuff through Instagram, social media. But the original testing went through a market research firm.Stephanie: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 ask a question and you have a minute or less to answer. Are you ready?Chris:No.Stephanie:Nope. Be right back. Need to go get some more tea. Get In the right mood here. All right. Well, we will move on anyways. If you had a podcast, what would it be about and who would your first guest be?Chris:Oh my gosh. My podcast would be about thinking big. My whole life I never thought big. I thought pretty small and I put roadblocks up in front of myself and I think that now as I sit on a board with Rob Dyrdek and Joe Jonas, literally anything is possible and it would be about stories and ways to help open up your mind to anything is really possible. And I think as cheesy as that sounds, it really is. And I feel like here in my home with my kids and now that we're talking about getting Mindright and this positive growth mindset and to hear them talking about it, it's a real thing. I don't have a title yet. I'll let you name the podcast.Stephanie:There you go. I'll help you name it. Who would you bring on for your first guest?Chris:I bring in Rob. He is an amazing person to talk to about all of this stuff. His mindset is just next level with what he does to keep his energy and his success where it is. It's remarkable.Stephanie:Awesome. What does your mindfulness practice look like?Chris:I'm sorry.Stephanie:What does your mindfulness practice look like? How do you stay centered and balanced and not getting pulled everywhere when doing a startup?Chris:I think for me, I committed to getting up early every morning. I have to be up by 5:00,5:15 or else I can't do the things that I want to do for myself, which is exercise or just have a moment of meditation. Whether it's a minute or five minutes or 20 minutes. I try to do that every morning. I have four kids so life is really hard sometimes. Here they are.Stephanie:I feel that.Chris:So it's get up early, it's a few minutes of meditating and just understanding where I'm at and being really grateful for that. Exercise, 30 minutes. That is my non-negotiable. I have to get 30 minutes in, if I don't my day is just off and once in a blue moon we have a sauna that was gifted to us by-Stephanie:Wow.Chris:It was miracle. That's another podcast.Stephanie:Yeah. Okay. I want that friend. Gift me a sauna.Chris:It was some local guy just giving it away. He was moving.Stephanie:What area of California do you live in because I don't know about many local areas being like, "Here's a sauna. Do you want ice staff as well?"Chris:I'm on the hunt for one of those. So, if you know one. I started fasting, so I intermittent fast. I don't eat my first meal until 12:00 or 1:00. And I found it's really helped with inflammation and energy and I feel great. I also stop thinking through COVID I just-Stephanie:So impressive.Chris:30 days and then you felt great and 60 days, I'm like, "Wow, I feel awesome." And it just stuck.Stephanie:All right. Last question. Two more questions. What's one thing that you don't understand today that you wish you did?Chris:What don't I understand. I don't understand a lot of things let's be honest.Stephanie:Good answer. Just everything. Lots of things.Chris:No. I think for me, part of the reason why we're starting digitally native is almost a personal challenge to myself. I know retail really well, I know relationships, building brands, building distribution, working with brokers. I don't understand digital that well. And it can be frustrating at times because the learning curve is pretty steep and it's always changing every day because you're learning something new and I think digital marketing I don't know very well.Stephanie:Well, you'll be learning it with this company. So that's great.Chris:It'd be great to hire the right people to help you.Stephanie:Mm-hmm (affirmative). Yeah. 1,000% to that one. All right. And then the last one, what one thing will have the biggest impact on ecommerce in the next year?Chris:I think it's these convenience delivery guys. I think they're going to change the game for a lot of people. FastAF is a really good example of what's happening with commerce outside of food and beverage, because they're delivering unique gifts. You need a gift and you're going to a party in an hour, they'll be there in 20 minutes with this beautiful candle or gift item which is just changing the way that we do everything.Stephanie:Yeah. Oh, I completely agree. All right. Well, this has been such a blast. I feel like my mind is really in the right place now after this interview. Where can people find out more about you and Mindright?Chris:Check us out at getmindright.com or on Amazon.Stephanie:All right. Cool. Well, thanks so much for coming on the show.Chris:I really appreciate it. Thanks so much.
27/05/2134m 36s

Customer Loyalty as the Key Ingredient for Success

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.---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---Transcript:Stephanie:Welcome back to Up Next in Commerce. I'm your host, Stephanie Postles, CEO and Mission.org. Today on the show, we have Chip Malt, the co-founder and CEO at Made In Cookware. Chip, welcome to the show.Chip:Awesome. Thanks for having me, Stephanie.Stephanie:Yeah. I'm really excited to have you here. I might not be the biggest chef, but I feel like I'm still down to talk all things cookware and maybe you can train me up on what I should be doing, and I need all the help I can get. That's my caveat to start this show.Chip:Awesome. We're happy to do so.Stephanie:Yeah. I like that. So, I want to dive into the background of Made In Cookware because I think you have super interesting story where, correct me if I'm wrong, you started and co-founded the company with a childhood best friend and you guys have a lot of history in the industry with your family and family's family, and I would love to dive deep into all that background before we get into the actual company of where it is today.Chip:Absolutely. Yeah. So, we started the company, or officially launched it, in 2017. So, we're just over three years old, now entering our fourth year. But really, the story began a long time before that, as you mentioned. My co-founder, Jake Kalick, he comes from a hundred year old family that has experience with cookware. So, his great-grandfather in Boston where he grew up started a business that outfitted restaurants and hotels, their kitchens with everything from walk-in refrigerators to knives to cookware to a lot of stuff that we're selling today. So, he comes from almost 10 decades of experience in the cookware space, or his family does. Then Jake and I grew up together. We actually went to preschool together.Stephanie:Wow.Chip:We were in the yellow and blue room together, then we went to pre-kindergarten and went to a school that was the same all the way from pre-kindergarten through 12th grade when we left for college. So, our history goes back 28 years and we're 33. So, almost to the beginning of when you can even start to remember, and we've been best friends ever since. So, it's been a pretty incredible journey. We've been able to mesh his background, his family's background, his family's history into our childhood friendship into a business and have fun doing it. So, it's been a pretty cool journey so far.Stephanie:Yeah. Were there ever points when you guys veered apart, came back together? When did you know or even think, oh, we should do something together?Chip:Yeah. To be honest, and it's nice that he's not on this podcast because he can't defend himself, but I don't think growing up I would ever start a business with him. I was more of the studious one.Stephanie:I know too much about you.Chip:Yeah, exactly. I was more of the studious one. I would say he would copy off me in high school if we had to simplify it, and also that I remember me in the space, in the cookware space as well. That's his background and his journey. So, it's been really cool. To be honest, the startup world and starting a business, I feel like the public only gets to see the glamorous side of things. But it's a lot of hard work. It's a lot of ups and downs. For just as many amazing days and successful days we have, you have a really tough day as well. So, going through that with someone you're close with that at the end of the day, you can just have a beer and destress is a pretty incredible experience.Stephanie:Yeah. So, when taking best practices and lessons from maybe his family history and how they've been doing things, what did that feel like, taking this company and maybe bringing in new practices and new ideas? Was there any bit of a struggle behind that where they're like, "No, no, no. We've done this for a hundred years. We know what we're doing. Come on, Chip. Just follow the lead"?Chip:No, we get that a lot. At some point or at some level, we are cutting out his family business. His family is a distributor. They take some of the incumbents who we're competing with now and then they sell them to restaurants and act as the middle man. Ecommerce and direct to consumer in general is a cut out the middle man strategy, and so we get that question a lot. Are they mad we're displacing that to some degree? No, his family's been nothing but supportive. They're super happy we're maintaining the history into something new and just evolving it into the way that the world is moving. So, they've been awesome.Chip:His family and his knowledge of just the product and the industry has been absolutely crucial [inaudible] starting a business. When we walk into a kitchen and we're talking to a Grant Achatz, who is one of the best chefs in the world, he's able to talk about BTUs of the burner that Grant's using and the oven and why it's better, and he's able to talk the talk. It really gives us an air of authenticity and an air of just immediate warmth when we have ... Food in general is a very relationship driven business. It has a lot of credibility when we're approaching partners.Stephanie:Yeah. I saw that you're in crazy restaurants, really big ones. Top chefs use you guys. How did you even get in the door of those people? Because to me, I think you can be really smart around the product stuff and why you need it, like you're talking about the BTUs of the burner and all this stuff. You can have that, but if you can't even get your foot in the door or get in front of those people, you can't really go anywhere. So, how did you guys make those relationships and get in there?Chip:Yeah. I would love to tell you that we sat in a boardroom and whiteboarded out the perfect strategy and absolutely nailed it off the bat, but that was clearly not the case and that's not how it played out. The way the company came about, and taking a step back, what we do is we sell kitchen goods. So, knives, cookware, multiclad stainless steel, carbon steel frying pans, down to wine glasses and table top items, and really anything to outfit a new kitchen you're walking into, Made In will provide that.Chip:Our ethos to start and our launching hypothesis was that food is so emotional and people are spending so much money going to a Whole Foods or a farmer's market and getting super excited about a marvelous grass fed steak from a local rancher who is 30 miles away and it's beautiful cut and then they're coming home and they're cooking it on a frying pan that's a hand-me-down that they couldn't even name the brand of, and it's ruining that steak. So, there is this behavioral disconnect of the beginning part of a process and all the care that went into it with the actual cooking at the end of the day, which was delivering the final product.Chip:So, we wanted to make people care about their cookware in an emotional way as much as they did the ingredient they were grabbing at the farmer's market. For us, that was meshing Jake's family history, that a hundred year old family history, with the craftsmanship approach of the manufacturers and partners that we work with. So, a good example of that is our 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. This area is the birthplace of cutlery, has so much deep history.Chip:You walk through and everything about this town is dedicated around knives. There's still the old factories with the old windmills that would power the old forges and it's just pure and center all knives. What we wanted to do was make a product and go back to that source and resource and tell that story so that when you pull the knife out to cut the steak that you just fell in love with, you also know all the craftsmanship and all the story that went into that knives.Chip:So, it was this approach of blending love and care on both side, a product to ingredient. So, that was in launch approach, and we carry that ethos through all our product lines. Our bakeware we just launched is from a proprietary recipe that's over 200 years old from the center of France as well, and that's what carries through every single product we make. That actually attracted all these partners. So, most stuff in our industry comes off of a boat oversees in Asia and is nameless and faceless and has a name printed on it, all looks the same, and no one was putting this time and attention and care into the supply chain portion.Chip:As soon as that happened, Tom Colicchio approached us and he said, "Honestly, I've been working in this industry for decades waiting for a company like you guys to come along. I want to partner with you guys," and he invested in us. From there, it was a snowball effect. Tom is just an incredible human being. Everyone respects him. He was able to be the first stamp of approval, along with our supply chain store being the second stamp, that started to attract a lot of amazing shops from around the world to be part of our brand.Chip:I'd say the last point in that, these aren't traditional influencer or endorsement deals. So, every chef we work with, they're authentic customers of ours. They're buying for their restaurants. It's not a pay to play deal. This is a real authentic relationship.Stephanie:That's awesome. Yeah. That's a theme I always hear and I think even for our company as well, that first customer is like the stamp of approval. Once you get the one big whale, then you can just be like, "Well, look. So-and-so is using it," and you can find their network. Yeah. Once you get that first one, I think everything gets easier. How did Tom hear about you? Were you guys doing some marketing tactics to get in front of him?Chip:No, through the grapevine. We approached Danny Meyer's fund as an investment proposal and we were too small. It was too early for them. They write 20 and $30 million checks for growth stage businesses and we hadn't even launched really yet. So, he introduced us. He was like, "Would you like to meet our friend, Tom Colicchio? He writes angel checks, and would that be okay to make the intro?" Obviously, we were trying to play it cool. We were like, "Yeah. I think we'd be okay with that." But obviously, we were ecstatic and super excited.Chip:We emailed Tom and didn't hear back from him for months were like, "All right. That clearly is not going to happen." All of a sudden, we got an email from him two months later out of the blue that was just, "Hey, guys. Landed back from filming Top Chef for two months. So sorry for the delay. Can you meet in New York tomorrow?" I don't know if he thought we were in New York as well. But obviously, we're in Austin, Texas and we were like, "Sure," and booked an immediate flight and more or less had a handshake deal to partner with him and get an investment from him that day. He was just a super awesome guy, super genuine, and believed in what we were doing, most importantly.Stephanie:That's amazing. So, what did that initial startup look like? You have an infusion of cash. What were your next steps? Was it already mapped out, or now you're like, "Whoa. This is really getting us to that next level. We need to change how we were thinking about it"?Chip:I had come from the apparel space, which I was working at a company called Rhone, helping them with digital marketing. So, if you were saying, "Hey, Chip. I need to go buy some stuff right now. I don't even know where to start," is generally the refrain we hear, and that was different from the apparel space because no one is looking at a T-shirt and saying, "I don't know how to use that. I don't know what to use that T-shirt." I put it on my body. We know that, right?Chip:So, the first year is all about learning what people really cared about, how to market our product. Our product is a performance based product. It will fundamentally make the food you cook better tasting, but how to deliver that in a way that makes sense to the normal consumer and it's not too chef-y, especially when we have all the chefs behind us. That was a huge learning process.Stephanie:Yeah. Someone once gave me a really big cast iron skillet and I remember being like, "Thank you so much. What do I do with this? How do I clean it?" And she's telling me, do salt and this and that. I'm like, "Oh, my gosh. Can I cook my engineering in here?" I tried a couple times and it just was burning and, okay, education is key around stuff like that. The one thing I was reading that I thought was really interesting too was your post-purchase engagement of basically using that as a training funnel, because you were maybe having people come in and complaining because they didn't really know how to use the cookware, and so you used that as a channel to start training them right after they purchased and maybe were checking in on the shipping and trying to see where their product was, that instead you would guide them to the website to train them. I'd love to hear how you thought about that, and do you still do that today?Chip:Yeah. I think we're very lucky in the sense that we have some of the best chefs in the world that are, again, our authentic partners and using our cookware. So, we thought a lot about and we sat back and we're lucky enough that because we work with these people, we're able to go into a restaurant and then the chefs generally come out and explain exactly how they made the dish they're serving us and there's very personal experience that heightens the entire enjoyment of going to that restaurant.Chip:So, we're sitting there and we actually kind of have a duty as a company, we have this entire group of chef partners and this entire group of home consumers to be the bridge between those so everyone else can have that experience and heighten their enjoyment of the use of the products. So, we work with these chefs. Grant Achatz taught us how to make an omelet, and he's known for this crazy molecular gastronomy. But actually, Grant Achatz grew up cooking in his parents' diner making eggs, and now he can do it the best in the world.Chip:We talk a lot about what can Made In do that no one else can, and we have this two-sided relationship that no one else does. So, how can we bridge that gap between the consumer and the chef in a way that really values and adds value to the consumer's process, and to us, that's education. So, you buy a carbon steel frying pan or you buy a piece of bakeware. Nancy Silverton, the best baker in the world, is going to give you a recipe to enjoy that product. If you buy carbon steel, as you said, carbon steel to us is a better cast iron, but there's a learning curve. The chef [inaudible] in New York is going to teach you how to season it, teaching you how to ... Wait. What the hell is that salt thing that that person was talking about, what that is, and how to use it, and that's coming from a real expert in the space.Stephanie:Oh, that's a really unique and interesting strategy. You're using the chefs as your influencers to train, and I feel like a lot of these chefs know how to speak in a language that'll connect with me so you don't really have to be like, "Wait, wait, wait. You're going too intense here. Let's dumb it down a bit." It seems like a lot of the best chefs have learned how to be the, what's the one, the Chef Ramsays of the world. Or there's another one I follow that's really good too on Instagram. Anyways, he does things in a way where I'm like, "I can do that," and it's just like, it's only five steps, it looks beautiful, but here's the two things that'll really take it to the next level.Chip:Yeah. Tom Colicchio and my co-founder, Jake, they both have the same philosophy, which is that you really get to enjoy cooking once you can just do the fundamentals. As soon as you break free of the recipe, you can actually start to enjoy the creative process [inaudible]. We talked about that a lot too, right? It's like, it's never been easier to order Uber Eats and have any meal you want delivered to your door within 40 minutes at a pretty good price. But people are cooking more and more, and why is that? It's because people actually love the process of the creativity behind it, of the expression behind it, of just the sense of accomplishment, or people do it to destress, or they're doing it for a specific diet.Chip:People are doing it for a very personal reason, and if we can give them the fundamentals of, hey, this is just a technique of how to sear a steak correctly, we don't need to give you, okay, add salt at the end or add a [inaudible] on it. That becomes your personal sense of creativity and your enjoyment for it. So, I'm just taking that to heart as well. If we can give you technique and how-tos as opposed to step by step by step recipes with the chefs who have gone to culinary school, who have done all this technique work for you, then it'll be a really powerful experience for the home consumer.Stephanie:Yeah, that's cool. What are a few of the top maybe cooking tips or tricks where you're like, "Once I learn this one thing, it changed my whole worldview on cooking"?Chip:Yeah. Definitely heat control. I think that is where most home cooks get in trouble. You talked a lot about just burning your eggs, or something like that, and it's not a hard concept, but there's everything flying around the internet of you need high heat to sear, and that's just not true, and low and slow is the best way to cook, etc. It really becomes down to your personal preference and style. You can sear a steak on low heat if you just do it correctly and give it its proper time and you can still have the exact reaction you want.Chip:Tom Colicchio is a low and slow guy and Grant Achatz tends to cook on higher heat. Everyone is doing it in their own way. So, I think for me, and even in my personal journey, understanding heat control and learning it correctly was the biggest unlock because that applies to the most amount of dishes that you cook. I think a good example of that is Tom Colicchio talks a lot about listening to your meal. So, when you have a pan and you heat it up, no oil, because most people will heat it with oil and burn the oil on and have a lot of dishes to do. So, you put a stainless clad piece of cookware on the burner, heat it up to temperature, dumping cold oil, let that heat up quickly, and then put on a cold steak.Chip:What is that cold steak going to do? It's going to drop the temperature in the pan. So, at that point, you need to have more heat into the pan to get that sear. But once everything gets up to rise, if you leave that high heat on, it's going to overcook everything and burn that oil again. So, then lowering it down. Everything on that is done to just paying attention to heat control.Stephanie:Is there any pushback that you guys have felt? You're in an industry that, to me, feels like an older one where people are like, "Oh, I've always used nonstick and it's fine." Now, it does feel like thing are changing where people are like, "These pans are toxic. They're not the best for the environment. There's a lot of things that you should think about." What kind of education around just using the products, but what else are you encountering right now when you're trying to push into this industry?Chip:Yeah. People do have a preference towards nonstick. It's the biggest objective business market to attack, and I think that's why you get the most amount of entrance into the nonstick space. It's also the most just Wild West of marketing as well, which we try and stay out of. The big push right now is "ceramic". I put it in air quotes or visual quotes because it's not actually ceramic. It's a Sol-Gel coating that looks like ceramic, and so the GreenPans of the world a decade ago dubbed it ceramic because it sounded nicer and sounded more premium. But really, it's a Sol-Gel coating.Chip:This was back in the day when DuPont was dumping stuff in water and all this stuff. So, they created this decade long fearmonger marketing tactic that a lot of companies have latched onto over the decades, and now GreenPan's actually in a class action lawsuit about all their face claims.Stephanie:I used to have a GreenPan.Chip:Yeah, exactly.Stephanie:I had to throw it away because I'm like, "I don't this is good to cook on."Chip:The problem with those too is Sol-Gel and "ceramic", which is how the normal person listening to this would hear it as, it doesn't last long. By definition, it's called a self-sacrificing surface. Every time you use it, it removes some surface. It scores four out of 10 on a durability score.Stephanie:That goes in your food, doesn't it?Chip:It does. But it's made out of what makes hair conditioner. So, you can eat your hair conditioner [inaudible]. But whatever. But just in terms of business, we're making performance based tools. We're not making a marketing gimmick company. Our gold standard is would this hold up in a commercial kitchen and would Grant Achatz or Tom Colicchio or Mashama Bailey, would they want to use this piece of cookware in their restaurant? You will never see a ceramic pan, a GreenPan pan in kitchen because that would last one week in a commercial kitchen.Chip:So, then they're making all these claims about better for you, better for the environment. If that thing's ending up in a landfill a week later, two weeks later, a month later, whatever it is, it's up to you to determine if that's actually better for the environment. [crosstalk] Yeah. Exactly. So, we're not in that game. We don't play in that game. We're here to make great tools that the best chefs in the world and the best home cooks and people who love to cook can use.Stephanie:Yeah. So, what kind of marketing are you guys finding most effective right now? When you said a lot of the other cookware brands are maybe using the fearmongering and just making claims that maybe aren't always the most accurate, what are you guys finding success in?Chip:Yeah. So, we love to tell the manufacturing story and the craftsmanship story. So, I'm just talking a lot about bakeware right now because we just launched on April 8th, and we went out to the factory in France and watched ... It goes through 50 people's hands who touch and inspect this and have been doing it for 30 or 40 years and it's such a beautiful process and it's pouring this clay and porcelain that is proprietary to them. I think there's one person who actually only knows the recipe and we're sitting there being like, this seems like a single point of failure as a business owner. You should make sure this person doesn't [crosstalk]-Stephanie:Oh, you're good.Chip:... [crosstalk] something. Like put it on Google Drive with a password protect or something. I don't know. But it's such a intimate, unique process and our customers love to see that, and the customer that appreciates that is our customer. Everything we make in the bakeware space is hand painted, and so we have these white porcelain with blue rims and red rims and every single piece is literally hand painted by brush. That's just so different than a lot of our competitors and what they do where the coolness comes from applying some coating that's powder blue or something like that. It's just totally different.Chip:So, we want to express that and for us on the marketing side, showing that is really beneficial because one, it is all the work we're doing, like scaling and working with these artisans and craftsman, is tough. It's tough business. But it's also really rewarding and our customers see how much care and attention and time goes into each one of their pieces.Stephanie:Yeah. That's great. When I think about, it feels very exclusive, like you have direct access to the person doing this who know the recipe. How do you put a moat around that so maybe other brands can't just come in and be like, "Oh, we know this one style of copper cookware," which is beautiful. I was looking at that like, "Ooh, that would match my one Moscow mule I have." But how do you put a moat around it to make sure that other brands don't just come in and steal your one single person who has the recipe?Chip:Yeah, yeah. It just goes back to Jake's family history and being so authentic in the space. He was working with a lot of people who were friends of friends who connected us to the right people and really, the only reason why we got a foot in the door was because of being in the space for 100 years. Most of our, or all of our competitors do not have any family history or any reason to be in it, other than seeing a white space and a market to go attack kind of thing.Chip:We don't talk too much about moats. To be honest, we have a very familiar relationship with all of our manufacturers, craftsmanship partners, and everything. Go out, spend multiple weeks. Our knife manufacturer told us she loved us and felt like we were her children and kids and sons at the end of it. So, these are real relationships and it's less about, hey, can we sign and exclusive for 10 years to lock out competitors and more how can we treat them like family, how can they treat us like family, and so they wouldn't want to do exactly what you're talking about.Stephanie:Yeah. How do you go about doing that? How do you instill that trust and relationship, and other than just being a nice, friendly person, which obviously you are, what else do you do so they really feel that relationship and you're like, "Yep, I'm not even worried about it because we got that"?Chip:Yeah. Some of them have invested in us. Internally, we have a mantra of hospitality first, and that goes towards everything from treating every customer who walks through our door or walks through our website door, whether they're spent $19 or $900, like we are a three Michelin star restaurant. So, what can we do to make you feel better, to enjoy the experience better, to, if you're having a problem, fix it, to do service recovery if you've had an issue? If UPS failed to deliver, how can we help you get to the answer that you need? All that stuff.Chip:That extends from customers as well as buyers, vendors, and manufacturing partners as well. So, what does that mean? It's treating them fairly on terms. It's treating them fairly on our business growth and practices and being an open book for them and sharing information and in negotiations, dealing with them in a friendly manner, and getting to a result that [inaudible] zero sum game, but it's beneficial for both sides. For us, that is the name of the game because it gets out of a let's solve for the six month term, and this is going to be a business that'll be around for two decades, three decades, forever, we need to make sure that we're treating people correctly.Stephanie:Yeah. I love that. So, when thinking about your customer, like you said, they can come in and buy a $1,200 cookware set and it's going to last a long time. It's not something where it's like you'll be back in a month. I'll see you when you need a replacement. How do you think about garnering that passionate customer base where it's like you have a good LTV on them? You're like, "They're going to be around for 10 years," because I've seen that you also are able to get wait lists of 10,000+ people who sign up for new products that you're launching. So, I want to hear how you think about that and keep your customer engaged, even if they ... life cycle of when they need a new product might be a long time from when they buy their first one.Chip:Yeah. So, we've been fortunate enough to have really strong cohort and repeat customer behavior. We're only three years old at this point. Our earliest cohorts have repeated over, on blended average, over 100%. So, industry average is 20%. [inaudible] 5x industry average. It's, again, in a product category that, as you mentioned, our product should last you your entire life. So, that's something we had to solve for and think about. Our first belief is that product quality is the biggest driver of longevity and happiness in cohort behavior.Chip:So, if your product stinks and you're the best marketer in the world, that's a short term gain. [inaudible] you can have actually a subpar experience with an amazing product and that's actually the better trade. Again, we try to solve for a great experience with a great product. But if we have only one chip to put it in, we would always put it into the product category because we believe that is what drives behavior. So, when we're going out, and one of our early investors and main investors had a really great point, which was you don't know how someone's going to find you. It could be a blog article about some tail skew that you just launched or cutting board.Chip:It's not, of course, you, but if that is their first experience with Made In, they are going to believe that everything else is like that cutting board. Right? So, everything you launch needs to be okay in a great experience. Or sorry. No. Everything you launch needs to be a great experience if that is their first product they've ever bought. So, don't launch tail skews that aren't up to the quality standards that you want, that don't have the manufacturer and craftsmanship story that you want, that don't have a good unboxing experience.Chip:So, we've taken that to heart because I think you see a lot of ecommerce companies just launch a whole bunch of stuff really quickly without that thought and attention behind it. Again, you don't know how people are going to find you. You're going to Parachute Home and you need a candle. If that candle doesn't come in an amazing box that represents the Parachute Home brand well, then you're probably not going to come back and buy their sheets. So, when we think about a product line and our offerings and cohort behavior and [inaudible] to answer your question, it all starts with product experience and product quality, and then again, that hospitality first mantra, treating our customers correctly, giving them customer service if they need it, and that will drive longterm behavior.Stephanie:Yeah. Oh, that's great because I think, like you said, a lot of brands do think about what are the loss leaders that you can put out there and just get people in the door, the quick hits? Like you said, I've bought many things for the first time, starting off with smaller price points, just to see, dabble in it a bit, see what it's like, and then be like, "Nope. I'm so glad I didn't buy that expensive $100 item because I just bought a bracelet for $10 and it was horrible. And yes, it was $10, but I'm still mad about it."Chip:Yeah. When I was at the apparel company and I was running analytics for them, we did a lot of basket cart analysis on which product ... taking everyone's first cart and basing out the SKUs that made up that first cart and then which of those SKUs led to [inaudible] second carts. Then we found an interesting mantra, which we've taken to heart, which was the lowest price point product of the most premium category was included in the most baskets that drove the highest repeat. To your point exactly on that, it was people who were trying to figure out, hey, is this material worth this extra amount of money I'm about to spend on it? I'm going to test that out, buy the cheapest one in that category.Chip:So, it was that product that we hadn't spent a lot of time and attention on, and all of a sudden, you're like, "Wow. This actually is the most important product of our entire company," because it's everyone's gateway and it's showing the material, but it's not a tough price point to hit on a first basket, and if we can show well on this first basket with this product, then they'll be great customers over the longterm. So, I think exactly what you mentioned is interesting.Stephanie:That's a good one. It makes you think about maybe adjusting margins on that first lower priced item, give it higher quality, lower your margins if you need to to keep that price lower, get them in the door, and then they'll probably go up from there when they have a really good experience with that cheaper item. I don't know if all brands do that, though. We will find out. Interesting. So, when developing new product lines, you're talking about the quality piece of it. But how quickly can you guys develop products, or are you more slow paced, like we just want to make sure it's perfect and it could take us a year to come up with a new product line because we're working with these artisans in France or knife makers or whatever you're doing?Chip:Yeah. It's been a mixture of both. We've had products that came together very quickly and was a match made in heaven with the craftsman who we reached out to and it just got to market in the way we wanted very quickly. We had a product, cast iron product that we were trying to launch in 2019 that got to the one yard line and we had spent a year and a half on it. We invested $50,000 of tooling and a ton of research and time and effort and all this stuff. It just wasn't up to the quality that we felt represented the brand and we scrapped that project at the one yard line, and now it's been a three year project.Chip:So, I'd say it's very variable. We are very aware that once we put that product out, it reflects on the rest of the products. So, if we put out a bad line and it doesn't carry the same quality and care and attention that the rest of our line does, it could reflect on ... Are they doing everything else half-assed as well? So, I would it's been a mixture.Stephanie:Yeah. How do you ensure that you're going to have enough inventory, especially when it's being handcrafted? We've had quite a few people on this show who have similar stories around ... We had Yellow Leaf Hammocks on in the early days and the women in the villages there were the ones making the hammocks, and of course, that can cause maybe sometimes supply issues. How do you even plan for that when it's like, well, this is one person's recipe and there's 50 people who are touching this product to get it out there, and maybe Joe got sick, so there goes his recipe for a week, we don't know how to create it anymore? Even plan when it's so, yeah, custom, I guess?Chip:Yeah. To be honest, that's been one of the biggest challenges of this business is our unique moat and value prop and everything is also the biggest challenge in the business. I think those naturally go hand in hand together. But you hit the nail on the head. It's about finding these craftsmen that make these amazing products, and they've never seen a company scale 5x year over year. They've never seen a company go this fast and just attack the market in this way.Chip:So, it's about, again, going back to being good partners with them, sharing multiyear forecasts, helping them invest in new tooling and new lines and things like that and working with them directly. It's a huge, huge challenge. But we've seen companies who get to this point and then take it and move everything to an automation facility and hurt everything that they built in the first place. So, we're not doing that. It's more about being great partners and figuring out the challenges with those partners.Stephanie:Yeah. Cool. So, when it comes to an ecommerce perspective, I like your example earlier about how to think about certain metrics and what you use to analyze. What are some other things maybe you pulled in from your past marketing experience into this business where you're like, "We've always relied on these principles, or I always look at these metrics every day to make sure everything's going okay"?Chip:Yeah. We look at star ratings by product line. Those are obviously very important for us. It's what is the benefit of ecommerce? In the early days, it was the cut out the middle man story. That's gone away now. It's, okay, direct relationship with our customer, one to one management of that relationship, and we believe more of that mantra, right? So, it's, at the end of the day, we always say at the end of the day when you buy something from Williams-Sonoma and you walk out of that store, you're never going to hear from that salesperson ever again. Your relationship with Williams-Sonoma and that salesperson who just spent a half hour with you is over.Chip:For us, it always begins at the time of purchase. They've bought from us. We now have a direct line to them, we can provide them content, we can provide them customer service. Our relationship is just beginning, and a lot of that goes into product reviews, a lot of that goes into monitoring return rates and how many customers exchange or return products. For us, that's a proxy for product quality. Then cohort behavior is a huge one as well and those three together give us an idea of how the product into customers viewing the company full circle is behaving and is trending. Those are probably the three we focused on most.Stephanie:Yeah. What are some of the behaviors that you're looking for when you say the cohort behavior is one of the biggest ones? What are you guys looking for and how would you adjust it if it's not going the way that you want?Chip:Yeah. So, cohort behavior, you're looking for trends up and to the right, and home space. When we launched in the home space, what we tend to see in this space is a diminishing marginal curve on cohort behavior. So, after they've bought all the things from you, then they don't ever come back again. So, you see cohort behavior one to six months kicking up to the right and then six to 12, a little bit less, and then flat from 12 on, or whatever it is. Right?Chip:So, we wanted to make sure that we didn't follow that trend because that meant, all right, we no longer have a relationship after 12 months, just out of an example, with that customer. So, what can we do to maintain that customer within our relationship and what can we do to provide value to them, whether that's content and recipes and how to use things better, whether that's new products? So, again, we started with just stainless clad cookware, we've launched carbon steel cookware, knives, wine glasses, plates, silverware, copper bakeware, all from these amazing facilities and stories. If we can treat them right in the beginning, then obviously they'll continue to support us throughout that journey.Stephanie:Yeah. What's some of the most engaging content? Is it the educational stuff? Is it the stories around the artisans making the product? What really pulls people in and then keeps them coming, not just a one off hit of, "Oh, that was heartwarming. I like that," and then you don't see them anymore? What keeps them there longterm?Chip:Definitely the manufacturing and craftsmanship stories. Those get the highest feedback and results from us. To your point on inventory being an issue for companies like ours, have that be a portion of it and then have that portion go through a pandemic where demand is increasing and manufacturers are closed in Europe for months because of COVID outbreaks. It creates a tough dynamic, and with and around those stories, we've generally heard the refrain of, "I don't care when this stuff comes to me. Just make it in the right way," and I think what these videos and this content does is show you that were making it in the right way.Chip:It's not like we're delivering medication that needs to be ... If you don't have your oval baker on Monday, you're not going to be too upset about it. Obviously, we're striving for best in class delivery and fulfillment and have a great team who does so. But we're not delivering life needed items. We are delivering craft products that are going to last you a lifetime, and if that takes an extra week, by showing people that, the care and attention that goes into it, they generally have that refrain of, "Do it the right way and get it to me when you can."Stephanie:Yep. Yep. I definitely feel that. How do you feel about being shown up in marketplaces or Amazon? I know there's a couple artisan marketplaces where they highlight some of the best products. To me, letting someone else tell your story, or even on Amazon, you can only tell it in a certain way. How are you guys approaching that?Chip:Yeah. Amazon's interesting because I think the mentality on Amazon has shifted a bunch over the last five years. The ecommerce space in general five years ago, I think, would have said, "No way. Amazon dilutes my brand. Amazon doesn't let me tell my story. It's going to cannibalize all the marketing efforts I'm doing over here." [inaudible] we're seeing a shift away from that mentality and people and brands racing towards displaying on Amazon. I don't think it means Amazon is still doing a great job of letting brands tell their story. To me, it's still a search engine and people tend to not get to the brand page ever.Chip:So, I don't think it's necessarily an Amazon win and that they're helping perpetuate all this effort and craft that we're going towards. It's more, I think it's becoming just such a necessary evil in terms of [inaudible] and people are growing these brands to get scale and need to find the incremental sales, and where else to go but wholesale and Amazon? So, Amazon's been interesting. We're not on Amazon. Almost 100% of our sales come through our own dotcom. So, we're not really on marketplaces either.Chip:In general, we have a kind of anti view on all of those. I'm not saying that will be forever. Again, each channel has diminishing returns at some sort of scale. Fortunately, we're not at that point. But yeah. We tend to like to tell our own stories and craft a message and own the relationship and provide the value to the customer.Stephanie:So, what's on the radar for you guys for the next couple years? Where are you headed? What are you hoping to do in maybe one to two years?Chip:Yeah. So, we're at the point, and when we launched this, we wanted to "own the kitchen". I realize that's an overused, cheesy phrase and hopefully, all the listeners didn't just roll their eyeballs. I swear-Stephanie:I didn't. [crosstalk] Own it, Chip. They're going to own it, everyone. Come on.Chip:Exactly. But for us, everything comes down to the why and it's not just to sell more things. It's, okay, a kitchen is part of the home and people like aesthetic congruency within their home. So, it doesn't make sense to have a different bakeware company vs. different knives vs. different cookware and pull those all out and now you're serving them all on a table to a dinner party and they all look different and it's not a reflection of what you're trying to do for your home, which again, is very personal to you.Chip:So, with the launch of bakeware, we're actually at the point right now where if you're moving into a new home you can buy almost every main vertical you need off of madeincookware.com. It can all show up in one box and it can look the same and it can feel like part of the same system and you know that everything comes from an amazing backstory with amazing craftsmen.Chip:You don't have to go research do I want [inaudible] vs. Henko vs. Made In knives, then All-Clad vs. Made In Cookware. You don't have to do 500 different pieces of research. It's a seamless process for you to do so. So, that was our main brand goal, and we got there a little bit quicker than we thought we would with the launch of bakeware now. So, we're super excited about this being the first year where you can literally pull out a butcher block and cut a knife and prep your food and then cook it on Made In and then serve it on a Made In dish and serve it with wine and all that stuff and never touch anything but Made In, which is pretty cool.Stephanie:That's cool.Stephanie:Cool. Well, let's move over to the lightning round. The lightning round's brought to you by Salesforce Commerce Cloud. This is where I ask a question and you have [inaudible] or less to answer. Are you ready, Chip?Chip:Yes.Stephanie:All right. So, I'd say you're probably an adventurous guy, from what I've read about you. What's one thing that you would never do?Chip:One thing I would never do. Good question. As of interest, I am, I'm not a huge water lover in terms of ... I do scuba dive, but I would never kite surf [inaudible].Stephanie:No kite surfing?Chip:Yeah.Stephanie:Wow. Okay. But don't you fly planes?Chip:Yes. [crosstalk] I'd rather go up than down, and climb mountains ever.Stephanie:Okay. Okay. What's a crazy story from flying a plane where you're like, "I almost died this one time, but here I am"?Chip:Yeah. My 14th hour, so about a third of the way through the private pilot's license, we had an engine out failure. It was right outside DC and we were descending beneath the DCA airspace, the Reagan airspace to sail out of it. It was with my instructor. It's the first time in the training process that you go and land at a separate airport and come back. The first 10 to 12 hours are just all at your local home base airport doing takeoffs and landings. So, we had just crossed the Potomac. He asked me to descend below the airspace, pulled back the throttle, and the engine just quit.Chip:He said, "Give it more gas. Don't throttle back that much," and I [inaudible] and it didn't kick back in. We declared an emergency, to make a long story short. When you declare an emergency, this is the Reagan now, they give you a dedicated person to help monitor your situation and he told us, "Okay, there's an airport two miles to your left. Can you make it?" "No." We declared a mayday situation. It had just had snowed two feet in the DC area at that time, which was pretty rare and lucky for us, and ended up crashing in a snowbank in someone's backyard.Stephanie:Oh, my gosh. I heard about this. I lived in DC.Chip:Did you?Stephanie:I heard about this. Yeah.Chip:It was probably 9:00 AM maybe. This lady came out in her robe with a coffee cup and just was so confused that there was a plane in her backyard, and we were sitting there kind of dancing-Stephanie:[inaudible].Chip:... because [crosstalk] yeah, we did this. We were safe.Stephanie:Oh, my gosh.Chip:She took us in and gave us hot cocoa. I was in school. I was at Georgetown at the time and I was missing, I had an 11:00 AM exam and emailed the instructor and said, "Hey. I know you said no excuses for missing exams, but here's the story." I ended up making it back around 12:30, three hour exam, walked in the classroom, and he stood up, stopped everyone, and said, "I will never accept any other excuses ever again for missing a thing," except for I was in a plane crash and landed in someone's backyard two hours away from the city.Stephanie:Oh, god.Chip:Which was pretty crazy. He ended up being a former Navy pilot. So, kind of, I think-Stephanie:Felt that.Chip:... touched a good nerve with it. But it was definitely one of the crazier experiences in my life.Stephanie:Wow. What year was that?Chip:2009 or '10.Stephanie:Okay. Yeah. I remember when I lived in Potomac area and I remember hearing about this. I don't know if it was you or not, but I remember a plane landing in someone's backyard and it was in the newspaper for a week.Chip:Yeah.Stephanie:[crosstalk] was you. That's cool. So, you've done four or the seven summits. Which one's been your favorite and why?Chip:Denali in Alaska was by far the most wild experience. That's the only one that's totally unassisted, no porters, no mules, not anything. You take a plane that lands on a glacier with your backpack and a sled and they say, "See you in 14 to 21 days." It was also the toughest. That is 120 pound packs over 14 to 20 days. We got stuck. So, we actually were making amazing time. We got up to the 14,000 foot camp. The mountain's about 21,000. So, it's the last major camp before doing your ascent, and about 10 days of -40 degree weather came in. So, we were stuck there.Chip:It was kind of a weird experience because the days were sunny and nice, but it was absolutely freezing and anyone who left the camp, 100% of them got frostbite and had to be evacuated. So, we sat there. We were running out of food. If we got through the last day of food and things opened back up, then we did a rapid ascent and summited on the last day we were able to. But you're out there in the wilderness. It's absolutely stunning and beautiful. You're kind of with yourself for ... It's quite a different experience than some of the others, which are a lot of tour groups, a lot of assistants, a lot quicker. So, it was a wild experience.Stephanie:That's cool. I mean, below 40. Wow. No, thanks.Chip:Funny story is the kid who actually had a [inaudible] job, he was a friend from earlier, but he was working at Walmart ecommerce at the time. We actually received our first investment via satellite on that climb for Made In.Stephanie:Wow.Chip:He was like, "What is that?" Then two years later, he joined us as our head of logistics. So-Stephanie:Oh, that's cool.Chip:... a lot of things came from that journey.Stephanie:That's a fun story.Chip:Yeah.Stephanie:Man. So many things all coming together. Cool.Chip:Yeah.Stephanie:What's one thing that you don't understand that you wish you did?Chip:All this stuff that's happening with physics right now and how molecules can go through walls and power all that stuff. I don't know. It seems very cool and I wish I got it, and I've had a lot of conversations around it. Every time, I feel like I'm high or something and I don't quite get it. But other people seem to get it and I wish I did.Stephanie:I haven't even really heard about this, or maybe I just don't know what this even is. So, I guess I'm in that same camp of I don't understand and now I'm going to start looking into that.Chip:Yeah.Stephanie:The last thing, what one thing will have the biggest impact on ecommerce in the next year?Chip:Probably the mass move to 5G. Everyone is, I would say, still in the camp of mobile as the first touchpoint and then convert on desktop or desktop conversion rates and AOV are still [inaudible] out of mobile, development still is mobile, second in most cases, and even though [inaudible] about mobile first development for the last decade. I think obviously as the more widespread 5G world gets out there, the focus on mobile maybe finally will get through to people. That's the most important meeting of ecommerce.Stephanie:Yep. Cool. Well, thanks so much for joining the show. It's been fun learning about the world of cookware and seeing where you guys are headed. That's, yeah, amazing. Where can people find out more about you and Made In Cookware?Chip:Yeah. Everything is sold through madeincookware.com. That's M-A-D-E-I-N cookware.com. We have everything from full kits if you're moving and need to outfit a full kitchen down to everything is also sold a la carte if you just need to fill around an existing group of cookware. So, we're excited and we have a full team ready to help you out if you have any issues as well.Stephanie:How amazing. Thanks so much, Chip.Chip:Cool. Thank you for having me on.
25/05/2147m 4s

Knocking Out Knock-Offs: A Look at Crowdfunding and Copycats

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.---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---Transcript:Stephanie:Welcome everyone to Up Next in Commerce. I'm your host, Stephanie Postles, CEO at Mission.org. Today on the show, we have Elish, Patel who currently serves as the VP of Digital and Growth Strategy at Peak Design. Elish, welcome.Elish:Thank you. Nice to be here.Stephanie:Yeah. I'm really excited to catch you before you journey into the redwoods to get some content for your company. I was hoping we can just dive right into Peak Design because your story is super fascinating. Right before this, you were talking about how when you came in, it was a sub $1 million company. Now it's at almost 100 million?Elish:We definitely had a positive in that we did somewhere around 70 last year and we're hoping to grow to that the hundred soon. So yeah, we're coming right up against it.Stephanie:Okay. I mean, that's an amazing story. That's why I was like, "We need to start there. I don't want to run out of time." Can you tell me a bit about what is Peak Design and how long have you been there, and a little bit about that journey?Elish:Yeah. I've been with Peak Design for about six and a half years. I met Peter Dering, our founder and CEO in a bar in Berkeley after a concert. We just sort of hit it off. So it was one of those-Stephanie:What concert?Elish:It was an Alt-J concert at the Berkeley Greek. It was one of those classic Silicon Valley chance meetings. I was doing marketing consulting in the Bay Area at the time and he needed a little bit of help on the digital side. A little bit about Peak design. Peter Dering had this idea of a camera accessory basically to hold your camera on the outside of your body, usually on a backpack shop or your belt while you're doing some more strenuous activities, whether you're hiking, biking, stuff like that, so you could get to your camera easily instead of it being tucked inside your bag and you would miss that shot, as we say.Elish:He got lucky, if you will, the universe aligned in that was the early days in 2010 of Kickstarter. He was just going to find someone to make it and try to get it into stores. But someone was like, "Hey, why don't you do a Kickstarter?" Put it on Kickstarter. Some people found it, wrote a story on it. I think it was in Gadget or something like that, and it blew up. He did 300-something thousand dollars on Kickstarter that year. It was something the third biggest Kickstarter. Again, early days of Kickstarter. There's now crazy ones.Elish:That was the birth of Peak Design. From there, it deepened into the Kickstarter and photography product world. We became one of the first companies to do a second Kickstarter. That's how we started just launching products on Kickstarter. What we found with that is Kickstarter just has this base who became our evangelists. We created this really one-on-one relationship with our customers and do have a say in the design of our products. They feel invested in our brand. We continue to do that. In fact, we've done 10 Kickstarters to this point. We've raised over $37 million on the platform, fully crowdfunded, which means we've never taken investors, and we get to make decisions like being a part of 1% for the Planet. We founded a climate neutral nonprofit to help companies to offset their carbon. We basically chart our own path and that allows us also to make the best things. We don't cut corners on any of our products.Stephanie:Yeah, that's amazing. We haven't had too many companies on the show that went the Kickstarter route. I think I can only think of one or two. What were some of the lessons maybe when you launched the first time to the second to the 20th time, that maybe things that you started adjusting over time?Elish:Some of the biggest things we adjusted were... they came with just the changes in the world of marketing, with the rise of social media in the last few campaigns, the influencer became so much more part of our campaign, especially the last two YouTube. There was Facebook, then there was Instagram and then YouTube has been around for a long time. But then we layered on YouTube specific influencers and that's it's whole other own community, especially in the photography world. And then relearning that YouTube in and of itself is a great search engine place where you can put evergreen content. There's one piece of influencer content that I have up on YouTube that I placed two years ago that still brings in five grand a month.Stephanie:Wow. Okay. What's this content?Elish:Well, we sponsored a video for basically someone who... and we were pretty adamant to make sure that if you're going to review our product, then you want to leave a positive review. We're not just forcing you to do that. We give them the product. They love it. They're like, "I love this. I want to talk about it." Usually for the bigger influencers, they're like, "Oh, I love this product. I want to put it up." It usually costs 30 grand. We did that and it got up on YouTube. I don't want to say the name just to blow up his spot or not. But put up there, did a great review of it, talked about the pluses and minuses, linked to the campaign below in the comment. That video, which because it did so well, they keep on their page and still draws traffic when you're... especially the campaign was for our Peak Design tripod, our travel tripod.Elish:When you type into YouTube "tripod" especially who people who are searching for like "how to use a tripod, this and that," it's one of the top things that comes up. People will go watch that video and like, "Oh, this is a cool tripod." They'll click the link and it still brings in a lot of traffic and a lot of revenue.Stephanie:That's really cool. Are you still using Kickstarter today?Elish:We just did our last Kickstarter in December. We did it for our new mobile line of products. We went from photography thinking that this iPhone is literally the best camera that everyone carries around on a daily basis. So we wanted to create a line of products for that. We did that in December and that was our last one. Are we going to continue to do Kickstarters? Probably, but we've done 10 of them and it's got to end someday, maybe. I don't know. We'll see.Stephanie:Why? That's what I'm wondering. I'm like, "Man, it sounds like it's going so well." I haven't heard of enough brands probably utilizing that, but it does feel like maybe that market is pretty saturated and it just seems like there's a lot on there when you go in and start looking through products that are launching and what you can find. It just feels like a lot more than maybe when you guys started out.Elish:Well, it's also, we were a part of this cohort that proved the model and then now it's easier than ever to go and make and design a product in China, Vietnam, wherever you're producing. In fact, there's full factory cities where you show up with an idea and they'll help you make it. That also feeds into the system. It's a problem with knockoffs in our brand as well. People are copying our stuff. You can just go there and that's the other part that saturated Kickstarter and Indiegogo, are these half thought out brandless products. It's easy to get lost in the fray there as well.Stephanie:Yeah. Let's talk a little bit about knockoff that you just mentioned, because right before the interview, I was watching a very fun video that you guys put together because of Amazon knocking off your bag, and I was hoping you can touch on the inspiration behind that and how you think to approach companies who are knocking off your products.Elish:Yeah. It's a funny story, obviously. The backstory is that we make this bag called the Everyday Sling. Literally that's the name. We have a TM on the term everyday sling, and we do sell on Amazon. Before the pandemic, we had a large amount of our direct revenue on Amazon. And the rumors are true that Amazon will see a successful product on their platform and say, "Oh, we can make some money on that and create an Amazon basic version of it." What they did in this case was copy our bags, stitch for stitch, it looks exactly the same, even down to the point a design element is just this little hyper lawn patch where we put our logo. They kept that patch the exact same shape and the exact same location on the bag and wrote Amazon instead of Peak Design on it.Elish:We've seen knockoffs before, but we were like, "This is egregious, this is crazy." I guess internally I'm lucky enough, we've never been a brand that does the patent trolling thing or anything like that. We build our own moat as far as around our design process. It actually is extremely expensive to make our products because of how functional and quality they are. And that's part of our own moat as well, built into the brand. But because this looks so much like it, we were like, "This is insane." It's actually far cheaper, low quality product. Our bag one for $100, they put it on there for $20. And they called it the Amazon Basic's Everyday Sling. They didn't even change the name, which was insane. They called it [crosstalk].Stephanie:[crosstalk] already good name, might as well just [inaudible] that too.Elish:Exactly. I work with our marketing team, we're all jokes here. Adam Saraceno, our head of marketing has gotten really adept at writing our scripts or videos. He wrote the script for this video and just came up with the idea and we've got an in house video team and we were recording it and we had this plan, we're going to make that video, put it on YouTube, we'll send it on email. We put it up, we sent it out and it caught fire on some forums. It started making its rounds. Before we knew it, we had something like a half a million views. And then that took off even more. I think the video has over 4 million views at this point. But the idea was like, "Are we going to sue Amazon? We're a fly to them. What can we do? We can trust that our customers can laugh at this along with us, and we can poke a little fun at them. That's all we can do."Elish:That's what we did and point out. If you watched the video, we sort of point out that you have a choice when you buy stuff. You can buy our stuff where we're blue sign verified. We're now fair trade. We pay our factories workers far above the local wages in their local... we produce in Vietnam. We're very honest about that. We offset all of our carbon and we lifetime warranty everything. It's going to last you forever, if it doesn't, we'll replace it. Amazon, you get what you pay for. But that's our message. It's easy to get frustrated, but I think it's probably better for your brand just looking at the long-term. Just stick to your guns, trust your brand, trust your product.Stephanie:Yeah. I think that's what I loved about the video, because it was so masterfully done and it's always a good reminder of why, like you said, frustration, anger probably won't connect with many people because sometimes... I mean, I think anyways, people want to see funny stuff, happy stuff. And the video was perfect where it's like, "Oh, if you don't care about all the bells and whistles, all the stuff you just named [crosstalk]." It was just so well done, especially when they were drawing it out, drawing out the product and being like, "Oh, do we want something that's actually good quality, now take that out and take that out." It was just really well done, and I'm not surprised it took off. What else helps get it in front of people to really help spread it?Elish:I mean, it was mostly word of mouth. We definitely put a few advertising dollars behind it. When it took off, we amplified it, just cause it was resonating with so many people, and I think that's important. Especially in digital marketing, you're testing content all the time, you're like, "Is this working? Is that working?" This was obviously working. I didn't need to test it against anything else. Yeah, we put some ad dollars behind it on Facebook to get it out there as well. But after we had about a half a million views on it.Stephanie:I also saw you tagging Jeff Bezos and Amazon support team and all these other people. I'm like, "Oh, that's good." But also, once again, the way you were doing it was just funny. I can't remember the Twitter copy of what you guys were saying, but it was very funny.Elish:That was Joe Callander on our team and he was like... I remember him messaging Adam and I going like, "Hey, I'm writing these tweets back to these people. I'm putting this. It's a little edgy. Is that okay?" We're just like, "Dude, gloves off, man. Go for it." He really went for it and I think it turned out really well. I like a lot of the YouTube comments because there are definitely some people in there... YouTube has got the worst trolls, I think. YouTube, there's definitely a few people like, "Why am I going to spend 100. I'll just get this $20 one." And he would just write something like, "We'd love that for you."Stephanie:Oh, that's great.Elish:"Go for it."Stephanie:It kind of reminds me of morning Brew. I don't know if you've ever seen them respond to people. Or Wendy's Twitter channel where they reply to people and have it out with them. I'm like, "I love it because they stay so close to their brand and their voice and keep it funny." Hats off to your team for knowing how to keep it on brand and keep it engaging for people. When Amazon came out with the knockoff product, and I think you said you've had other companies as well knock off your product, what kind of result did you see on sale? Did you see a direct impact when they came out of like, "Oh shoot, our daily revenue just went down in half and now we need to figure out how to claw our way back in front of our customers."Elish:Luckily, the Amazon thing made buy our bag more. I'm sure it lifted their sales as well because we just got so much hoopla, and it got a lot of press attention. Pete, our CEO was doing the rounds on a bunch of the media channels. On the other ones, we really didn't notice. If anything, it riled up our customer base because they would see it and be like, "This is just like my Peak Design bag and this is just like this." Their claws would come out and they'd go after it. That's definitely... I attribute that to our Kickstarter base and how we formed as a company of like we created this place where people thought they were part of the brand, and so they'll step out the defend it as well.Stephanie:Oftentimes I don't see brands maybe highlighting all their differences. That's why I loved your video when you're like, "Here's the five or six things that we do that you'll never find with an Amazon Basic." Did you guys maybe change your strategy or how you were messaging that? Because maybe before you weren't as upfront about like, "Here's why you should buy with us."Elish:I'm glad you brought that up. We definitely started steering away from it because early on in our brand, we certainly did that. When we started making camera straps, we were like, "This is how the other people work. This is how ours works." Then we were just like, "Maybe the product can just stand on its own." And it did because the functionality of our product was so different for so long. But again, that was a unique scenario where our product was absolutely different than the competitors. Now the competitor is copying our product. So now we're forced to be like, "They copied it, but not very well." It's almost like we need to inform our consumer of the pitfalls of trying to buy something that's similar to ours, but probably fails on quality and functionality. They're getting duped by getting these cheaper made knockoffs.Stephanie:Yep. Yeah. Yeah. That's definitely important to come back to the roots of... you have to defend your ground and you might lose sight of that for a bit, but it's interesting to hear how it comes full circle with like, "Okay, lean back into our differences."Stephanie:The one thing I wanted to circle back to was going through what it looked like when you joined the company, when it was sub 1 million and then where it's at now, close to 100, and talking about... I know we were just talking about earlier, how you're going to go into the redwood forest, you're going to be creating your own content and thinking through your marketing tech stack, and I want to hear what that evolution has looked like, because I think you mentioned the team didn't scale up with that revenue as much as maybe other companies would have done. I just want to hear it behind the scenes of what that looked like.Elish:Yeah. Credit to Pete, our CEO, and he's been extremely protective of our company culture. We're a pretty tight knit group of people, we're close, I think 38, maybe close to 40 people. When I joined, we were 10 people and it was just me and one other marketing person. As I mentioned, a lot of that was to keep culture tight, but also, we try to prioritize what we need to do and not do too much more than that. One of our mission value statements is to prioritize happiness over growth. When you start adding too many people, sometimes you end up literally looking for work for them to do, and then you're managing all those people. Then the business becomes about managing people, which is a part of a brand, but more or less so than the product.Elish:We are definitely a product focused company and it's about letting the marketing stand on the quality of the product. What we've done to enable that is rely on creating a really good network of third parties. Our shipping is third party, our warehouses are third party. We have some in-house customer service, but we have a little bit of outsourced customer service as well. For marketing, we really rely both on my strategy and executional knowledge, but we amplify that with an external digital agency. What that allows us to do is remain really nimble. During the pandemic, we didn't have to lay off anybody. We didn't make any pay cuts. We've been profitable since day one because we haven't had to push scaling because of not having investors as well that say, "We need you to make this much profit in the next five years."Elish:That's been really stressful for sure, in some instances of hyper growth because we have been growing really quickly, but again, what it came down to, it was like, "What's important in this moment? Okay, we're launching this new product, let's put all eyes there, let's make the right content, get it in the right place." I think we're going through another little phase of growing pains where we now have a very large assortment of skews and we're feeling the pinch of trying to maintain the attention on them across the board and then also making sure that we're supporting our retail and wholesale accounts. Half our business is from places like BNH and REI and we're distributed around the world. They need tons of content as well. They need our help on making sure the brand is represented correctly.Elish:It's becoming a lot of work. We've been scaling on our design and creative side, but there's starting to be a pinch on the more technical stuff. We're trying to think through, does that mean a bigger agency? Do I need to start hiring more internal people? I think it's going to be a combination of the both. I think it's going to be a skeleton crew internally that is really good at handling or wearing a lot of different hats, but then managing some external help as well to make sure that it amplifies our abilities.Stephanie:Yeah. What's the best way to structure it when you're working with agencies to make sure that you can scale yourself? Like you said, you're one of the people who are... "here's the vision and go." How do you make sure that it scales in a way that is not totally going off course?Elish:Oh man. That's a really good question. And I can't honestly say I've figured it out. I'm really not sure. I got to be honest about that. I'm going through it right now, and I think... to be quite honest, I think I haven't been able to... there's only so many hours in a day [inaudible] that require attention and it's really hard to separate or to combine strategy, deep thinking and execution. You have to turn one off to do the other. I think that's been a hard lesson that I've learned over the last year and a half, which is I do need time to just sit and write and think while I'm not executing. I'm really thinking about making sure I separate those roles for sure.Stephanie:It's definitely a hard question and a good thing to figure out, but you have time, there's no rush.Elish:Yeah.Stephanie:What does new customer acquisition look like? How are you guys approaching finding new customers and maybe keeping your current ones?Elish:There's the classics, which we definitely continue to double down on, which is... it's funny PR is an age old thing, but it's still so important and making sure that you stay just in the conversation. For me, when I'm thinking about going for... we've been so getting into the gear reviews and top 10 lists, and I'll never trust the best 10 lists ever again after being in there initially, because it's not like-Stephanie:It's how much did you pay to get that spot.Elish:Oh, yeah. Or who do you know exactly. It's not like someone went looking for the best stuff and like, 'This is what I found." No, all that stuff was definitely put in there. But to me, it's about the conversations you're starting around your brand and industry as well. When it comes to our mobile product or trying to stir up the conversation of like, "What else do you do with your phone? How do you use it in your daily life? Is having just the skin on it that doesn't do anything useful?" Because we are using it elsewhere, in our car, on our desktop, we've made a function on our bike and how it works. Do you have to jus pound people with your product or can you talk to them about it and start the conversation?Elish:There's the whole... We started digital marketing in paper, Facebook, social media advertising, Instagram. TikTok obviously, Reddit, but man, that whole industry, I think, is going through an upheaval currently, obviously with the change in privacy data that Facebook and Google and everybody is facing, and is making everybody rethink about how they're stacking that in their marketing funnel. I think it's a good thing. I think people are starting to think about the intentions and nature of their message in their advertising again, as opposed to, "Oh, if we change this button to red instead of blue, that's going to..." what intention... is that excepted to drive conversion?Elish:I think people have been overthinking the data part for a really long time instead of trusting your marketing instincts/knowing that, or just not really paying attention to the marginal benefit of spending a week trying to figure out what color button needs to be... what else could you have done with that?Stephanie:What are you guys doing? Because, I mean, I think it's such a scary world for a lot of brands who have relied on that pixel tracking, and everything they've been used to, it feels you have to move quick, make decisions in an unknown world where you're like, "I don't really know how they should operate." How are you guys thinking about it moving forward?Elish:Well, you can still track the classics, which are engagement. Then layering in other strategies of making sure you're getting first party data: your email capture and the campaigns you're doing with that. Before we could track everything, we were still trusting things like how many people were seeing it impressions and the quality of someone's audience and so on, on an influencer campaign. But also again, being a part of the conversation in places like Reddit, TikTok and making sure that that is a constant stream of content as opposed to these big advertising things where people are just blind to them now. I don't remember the last ad... I definitely learn about people or a brand, and I'm like, "Oh, that's interesting," but it's pretty rare that I click, and we've seen that on Facebook's ROI and every number across the board has tanked over the last few years. You used to put an ad, it could have anything in it and you'd get a 10 X ROI. Now we struggle to get three.Stephanie:What channels and platforms are you trying out now? Because to me, TikTok sounds like the perfect area. I get so many photography tips on there. I don't know if you've seen all those videos.Elish:Absolutely.Stephanie:That seems like a perfect channel. If you can keep that content going though. But what are you guys betting on?Elish:Yeah. We're exploring TikTok. I don't know if we're betting big there, because our demographic is a little bit older. I do have a theory that there's a very active demographic in... we're in the 25 to 40 range. I think people 25 to 40 are still actually really active on TikTok. They're just not-Stephanie:I am. I'm flapped out in the middle. I'm on it.Elish:But they're consumers, they're not posters, they're not commenters, which is fine. I think that is going to be somewhere we'll probably spend a lot of energy. We're definitely doubling down on content pieces on YouTube and places again, where we can talk directly to the population. Email's still a really big thing in customizing that consumer journey on how we reach them on that. So when they reach our website, where are they seeing? Where are they looking? Where are we sending them? Those are big. Then I'm obviously looking at Reddit. Reddit has had a pretty big limelight over the last few months, just with the game stuff. But otherwise I'm open to suggestions. So send them my way.Stephanie:I mean, I haven't heard too many people talk about Reddit. Are you just thinking about going after Reddit influencers in a way who are talking about what kind of bags to use, or how are you thinking about that?Elish:Yeah, I think we're going to look at it from the social media manager perspective. Someone who's going to go in there and just start conversing. We do have... especially with the gear focused product line, people are like, "Oh, what do you use for your Canon camera? What do you use for your Nikon camera?" Then just inserting ourselves on an organic level there. I don't know about Reddit influencers yet, but certainly something to consider. But I want to keep that as organic as possible to start out withStephanie:Yeah. It always seems hard to scale those efforts when you want to go about it in an organic way, but then thinking, "Okay, one person can only comment and keep up with so many threads and then if they also have to do Facebook and Instagram and everywhere else, it seems hard unless you continually to hire more people."Elish:Yeah. The scaling part is hard. I'll be interested to see if there's ever a good agency that can figure out how to represent your brand Well.Stephanie:Let me know, because we have not found it and we've tried many. I keep trying and trying, I'm like, "One day we're going to find something perfect."Elish:Same.Stephanie:I also think there's something to the frictionless way of shopping on a lot of these platforms. I even think about TikTok. I'm the quiet consumer who's looking through all the stuff, enjoying it, but then I will go and open up a Chrome browser to find that product. I'm the worst kind of consumer. You have no attribution on me. You don't even know where I came from. But I think there's something there where because that platform still feels like there's a little bit of friction from that video. Sometimes it flips so quickly, you don't have time to click. Is there even something to click? It seems like there's a lot of room for growth around making it easy for the customer to buy.Elish:There's been a movement to do the specific app to app based experience. Allbirds did a really good job of it. I just downloaded the Nike app, just being like, "Oh, I need a new pair of shoes," and I saw on their website. I was on my phone and then they were like, "Get the Nike app." I downloaded it and I was... this at the airport, and I bought a pair of sneakers right there because I was like, "Those are cool because they..." I mean, this definitely works with someone with a much larger skew count, but they served me a product that they thought I would like. I don't know how they figured that out. But they figured it out somehow. Maybe they just have really good products. I was like, "That's cool." They had everything built in Apple Pay, all that stuff, made it super easy. It was kind of scary, it was one of those situations where I hit buy, and before I knew it, it was paid for and was shipping to... I was like, "Wait, did I mean to do that?" And I-Stephanie:"My finger just went there and it just happened, and now I have shoes coming."Elish:Exactly. I thought that was a really cool and something... We've done a lot of work on our mobile experience, but we have a lot of work to do. I think people have... most websites they go to have a big thing to figure out for the mobile experience.Stephanie:That's something I've thought about for a while now, because previously at SaaS I worked before, many people talked about going to an app free world, and apps were a thing of the past. I even noticed that in my own history, it's like, you get a phone early on, you get a billion apps, you run out of storage, you chill out a bit and you're like, "I don't need all these apps anymore. I don't want to try everything." Then storage gets easier. So then you're like, "Well, maybe I'll try a few more." But now I'm back in the stage where I'm like, "I'm good with just a couple of things. I don't want everything there." How do you see it? I mean, I think you mentioned Allbirds did this too. What do you see that future looking like and how should brands maybe try it out there?Elish:I think, to your point, we're trying to figure it out again. I liked that app experience for a couple of reasons, which was, when you become a fanatic or just really into a brand, you're okay having that because what Nike and Allbirds are also doing well is serving up really good content on those apps. I'm inclined to go into the Nike app because they've got something cool to send me, put me in, even if I'm not buying something, I'll go look and read about it. That's a big play. Earlier as the experiences on the other platforms. Shopping in feed on Instagram and stuff, which is becoming a much better utilized thing. I think we probably need to utilize a bit better as well.Elish:There's features in there, especially in influencer campaigns when you're able to link your account to other people's Instagram accounts so that they can tag your product feed. That's interesting to me and disseminating it in that way.Stephanie:Yeah, that's definitely an interesting world to think about. I also think if you bring in your tribe and a community and create an experience that you can't get elsewhere, then maybe I would open up the app. If it wasn't just product focused, like you said, if there's content there, if there's something that's going to draw me in and keep me engaged. But it does feel hard sometimes to keep me engaged on an app, unless I get that dopamine hit, open it up and get something new. That's a high bar to have, having something new every time.Elish:Definitely a high bar to have. Then I think Casper, I don't think they have an app, but I've been in the market for a mattress. Man, I sound like a real materialistic consumer these days, but-Stephanie:Probably get so many ads coming your way. They're going to hear you. They got the voice recognition and they're going to be [inaudible] you.Elish:I'm in the middle of trying to buy a mattress and they executed on the text game really well. We do text marketing and it works really well in getting people past the last decision point. They're like, "I don't know if I want this size or that size." I don't know if you've talked to a lot of people, but text is great. People are like, "I don't think people want to receive text messages." Surprise, surprise. They actually do. They don't care.Stephanie:If [inaudible] something they want. That's what I've heard, is texts can be great if you're not just pushing products all day. If it turns into a conversation and maybe giving them some kind of value, instead of just like, "10% off, 10% off, it's a sale happening." It needs to feel personal and give value.Elish:It does. But it's a balance. If you give them enough value and then when you need it, you can send that 10% off text. It still works and that's worked really swimmingly for us. But I think the stakes are the same, if not lower, maybe they're about the same of sending an email. Just like with anything, don't overdo any piece of marketing, you annoy people. But I don't think it's any less or more annoying than any other piece of marketing I get from people as long as it's not overdone. In Casper, if you go to their website, they just really did the text acquisition, the opt-in process really well. The 10% off if you sign up for the email and they figured out a good way to do it for text as well, "Oh, you want to get this coupon straight away?" Let us text you." I thought that was cool, a way of just activating someone very quickly.Stephanie:Yeah. Are there any other brands that you watch where you pulled some tricks from, and you're like, "I love watching Nike. I love watching Casper, and then actually trying that out within our own company?"Elish:Good question. I think I've listed the ones that I've noticed recently, and definitely Allbirds did a good job. I had a good post-purchase experience recently. I'll just give you the outline of what that was, where I needed to return something. Well, first of all, obviously, there's the way of tracking and making sure that you get in contact with what you bought and where it's coming and when it's coming. There's lots of good apps for that. We use one called Shipup. And then I needed to return something and, I'm forgetting the name of the service, but now they've set up places, you can just return something. Instead of shipping it back, you just drop off at the local location. It's usually a business. It's a win-win. You bring someone into your business, you can return it there. It was seamless. I remember in the store, the person... I think I was just in some random boutique dress store and I was returning a blender for Amazon.Stephanie:Oh, that's cool.Elish:I'm making those things up, but it was that sort of distinct, that sort of contrast of what I was doing. I remember then scanning the product and then I got a notification of my refund directly on my phone in that second. I was like, "That's awesome. Now I know when I buy from this person and I need to return, it's going to be seamless. I'm not going to worry about where my money is, where the product's going." It made me want to buy from them again. It was great.Stephanie:That's a good experience. I think that's such an important reminder too, about lifetime value of a customer. It's not always about those quick hits. Like you said, if I were to have an experience like that, I would buy many more things much more quickly, if I'm like, "Oh yeah, I can just go right next door and this boutique will take any of my returns for all my blenders that I buy."Elish:Yeah, exactly.Stephanie:That's awesome. What experimental things do you plan on doing over this next year or two that you're most excited about, but you don't know if it's going to work, or maybe that your team's even telling you like, "No, Elish, this is a bad idea."Elish:Really good question. I'd have to go into my notes. I ideate on this stuff for a while. But we tried some podcast stuff last year when money was a little bit more free flowing for us. We are a travel bag brand, so that's definitely taken a hit for us. And that was exciting at the time. We had a piece on Conan O'Brien show and I was like, "Oh, Brian said Peak Design. That was pretty cool." As far as I can tell, CPMs for podcasts are still relatively low compared to other things. I think that's great. I think there are some expansion in still are our email practices on how we're collecting emails and moving outside of that. What you mentioned just now, what we talked about, the being able to shop our product in social posts that aren't even our own, there are some technologies, video technologies out there where you're shopping in video when it's placed on someone else's website. I think that's really cool.Elish:Then partnering with our distributors more on how they're representing our brand and getting that more up-to-date message out quicker with them. Reddit, we mentioned. Forums.Stephanie:Well, I think it'll be interesting with all the pent up demand of people wanting to travel and get there.Elish:I hope so.Stephanie:It'll be fun to probably see a very different peak than maybe what you've seen over the past year or so, and you all just have to be ready for it, I guess.Elish:Yeah, exactly.Stephanie:Cool. All right. Well, let's jump over to the lightning round. The lightning round is brought to you by Salesforce Commerce Cloud. This is where I ask a question and you have a minute or less to answer.Elish:Okay.Stephanie:Are you read?Elish:I'm ready.Stephanie:You're adjusting your seat like, "Ooh, I got to get ready for this."Elish:Yeah. Ready.Stephanie:All right. First up, a few people know that I like to...Elish:Few people know that I like to play poker.Stephanie:Are you good at it?Elish:I was a professional for a year. Right after grad school, I was looking for a job and I played live poker for a year.Stephanie:Awesome. What one thing do you not understand that you wish you did?Elish:Oh, man. So many things. Probably... sorry, I have a minute or less. Is that right?Stephanie:Yeah.Elish:Give me a bell if I... Just topic of the times right now is definitely the Bitcoin market and different types and where, give me a glass ball of where that's going because I want in. Every time I think I've figured it out, I learn something new and I don't. Yeah, I'd love to understand the future of the economics of how that's going to work.Stephanie:If you were in the Austin area, I would tell you to come to our little crypto dinner that we do, where we go deep into futures and investing in that. It's a very interesting space. It's around here.Elish:Okay. I'll come visit it sometime, for sure.Stephanie:Yeah, that sounds good. A time when I made a powerful choice was when what?Elish:Oh man. I've quit a lot of jobs and taking that chance on myself. I did that when my last corporate job, if you will, I worked for American Express and I said, "I'm just going to go figure it out," and I've never looked back. I know that's a common story, especially in our worlds, but that was the most freeing choice I've ever made, is just I will never work for a large corporation where I can't be in control of my destiny.Stephanie:I love that and I agree. I think it's still always a good reminder though, because it's easy to get pulled in. A good reminder to be able to have that freedom to do what you want. If you were to have a podcast, what would it be about and who would your first guest be?Elish:I think it would be something about just the hilarity of the world, how it intersects... just how we all take ourselves so seriously, but then trying to basically pull back the layers of the onion on that, and then looking at how it's affected us as people when it comes to our depression, our nutrition, and how we live our lives. It's basically all of the loose things that you could think about for the millennial generation and make fun of it, but in a serious enough way to be like, "It's going to be okay, man." I think we all get so caught up in like, "How am I changing the world? What are we doing?" I think the message I'd like to tell most people is like, "This is..." the message of the movie Soul. Did you see Soul?Stephanie:Yeah. So good.Elish:It's like, "Oh man, I'm trying to do something big." "Actually you're doing the big thing. This is it."Stephanie:I like that. Who would your guests be then?Elish:I would get a combination of some... I think, going back to Conan O'Brien, I love Conan. He is one of the funniest people out there. I think he went through this crazy arc where he was supposed to take Jay Leno's spot and then they took it away from him. He got pretty angry about it and now he's still doing his own thing, and I'd love to talk to him about... people have talked to him about that, but where he thought he saw yourself going and now where he is now and if he's okay with it, and just what perspective that it gives him.Stephanie:Yeah. Well, I love that. That's a good one. All right. And the last one, what one thing will have the biggest impact on ecommerce in the next year?Elish:The climate and how we think about people and consumption. Fast fashion is going out of fashion. Absolutely. I hope anyway. But I actually don't know that because I don't know if I'm just in a bubble or I'm just in a bubble of people that care.Stephanie:No, I think I agree with that. There's such a big shift now to sustainability and how companies are creating things and paying their employees and all that. Yeah, I agree. That was a good forcing function this past year, too, to think differently about all that. Elish, it's been such a fun interview. Thanks for coming on the show. Where can people find out more about you and Peak Design.Elish:Peakdesign.com. I just had a contact button up, but you can go to elishpatel.com and email me if you have any questions.Stephanie:Amazing. Well, thanks so much for joining us. It's been a blast.Elish:Thank you.
20/05/2145m 17s

Migrating a Fourth-Generation, Family-Owned Business Online

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.---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---Transcript:Stephanie Postles:Welcome to Up Next in Commerce. This is Stephanie Postles, CEO at Mission.org, and your host of this lovely show. Today, I'm chatting with Nathan Scherper who currently serves as the president at Sherper's. Nathan, welcome.Nathan:Hi, good to be here.Stephanie Postles:Good to see you. I feel like I need to be like, coming live from Lake Michigan right? Is that where you're at?Nathan:Yeah. The shores of Lake Michigan. I feel like I'm that meme of what your job is, and what your friends think you do, and your family thinks you do, and your coworkers think you do. And I'm hitting the stereotype right now at camping, but I think it's only the second time I've been camping in the last two years because it's been a busy run.Stephanie Postles:Wow. I was thinking, I'm like, "This must be Nathan's thing.Nathan:No.Stephanie Postles:He's out in the woods living his best outdoor life to really get the brand right."Nathan:Yeah, for sure.Stephanie Postles:That's fun. Sherper's is an outdoor retailer, fourth generation family owned and operated, and I want to hear all about the background, starting back in like 1935, because we haven't had on many companies that have been family owned and operated for that long. And your company especially seems like it's gone through many transformations and changes over the years. And I was hoping you can start with the story and what was Sherper's doing back in the '30s?Nathan:1935, it was opened up by my great-grandfather, Sam, and it was actually a men's haberdashery. So it was church ware, it was like top hats and canes and suits, and that's what they sold.Stephanie Postles:I didn't know what haberdashery was, I literally Googled it. I was like, "What is this word?"Nathan:Yeah. That's what it started out as. And then my grandfather and his brother, they fought in World War II, I believe it was. And when they came back, there was just a ton of army Navy surplus because the government was selling off all the uniforms and the gear and everything, and you can buy it really, really inexpensive at auctions. So they thought it would be a good idea to buy all this stuff up, bring it back and sell it. And that was when the camping boom started, and a lot of the stuff that the military was using because they were basically camping, they bought that all up and sold it to people in Wisconsin to go camping.Nathan:And so it was a surplus store probably from the '50s really up until today, we still carry surplus, but then we started to transition to more of a general outdoor store, I would say, in the '90s and picked up brands like Columbia and Eureka tents and some of the more name brand camping, brands that we know of today.Stephanie Postles:Awesome. So you entered the business in 2015, or is that when you officially became [inaudible]?Nathan:Yes. That's when [inaudible] I came back at my first day on the job was when I was 12 because I really, really wanted to work. And I worked in a store location where my aunt was running the store and first day I had to go around the store and write on a note pad, every single product that we carried. And if I didn't know what it was, we had to go back through the store and my aunt had to tell me what it did. And then after I did that, she made me clean the toilets. So that was my very first day on the job. But worked throughout high school as a summer job. Once at college had a six year run in corporate America at Abercrombie and Fitch. And then after that came back into the family business and then the role I'm currently in now.Stephanie Postles:Okay, cool. Did you always know that you were going to come back and be a part of the business again? Or were you like one of those people, it's like, I'm not doing the family thing, I'm off to do my own thing for awhile?Nathan:It was always in the back of my mind. I thought it would be a really cool thing. There was zero pressure from my family to come back into it, if anything, I think they were like, go and do your own thing. Because I think sometimes you want the opposite for your kids of what you had. So I think my dad was like I wish there might've been something outside of the family business. I wonder what I could have done. So he said, "Go explore that." But I did that for six years and I loved my corporate American job. I learned a lot of things, but really I just wanted to have something that was more entrepreneurial. And if I succeeded, it was because of me. And if I failed, it was because of me. And what better business to go back into, because it had been established, but it needed some things to continue on into the next generation and yeah, I just never looked back and it's been a great choice.Stephanie Postles:Yeah. That's very cool. So thinking about a company that's been around for so long, I'm sure there are a lot of lessons and themes that you guys look back on where you're like, wow, this is what kept us running. Because thinking about like staying running for that long and staying relevant, it seems very difficult. So what lessons or theme did you guys have around the business that maybe it's still true today?Nathan:I think it's kind of cliche, but customer service first and foremost. We've always been small. We've been like that small mom and pop shop, and being able to do things that maybe some small mom and pop shops can't do, but I've always had that mentality where we know customers' names, can go out of our way for customers. I think that's been one of the biggest things for us as we've stayed true to who we are over the 86 years of business.Stephanie Postles:Yeah. Cool. So you guys did not have an ecommerce presence five years ago right? When you entered into the business, were you just strictly retail?Nathan:We were pretty much strictly retail. I think we were doing like 0.01% on ecommerce. We had a website, there were a couple items up there. But it really wasn't a focus just because it was going to be a huge investment. We had to have somebody who knew what they're doing and run it and then just the technology and the labor behind it, it was going to be a huge leap of faith. It wasn't anything that I think my dad and my brothers in the business with me were willing to do at that point until we set up a plan and trying to figure out what the best jump into it was going to beStephanie Postles:What did the early days of strategizing look like to try and convince people to come on that journey with you and show them that this is a good way to go?Nathan:Yeah. One of our store managers was the one who did the first website. He learned how to do the backend things of the website and build product. So we had him a couple hours a day off the floor building that, putting product up. And we really got to the point where I was like, "Okay I think if nothing else, we need a website that shows the product that we carry in the stores, because for the local people, that's where they're going to first, especially for big ticket items, like a kayak or a tent. They might not be buying it online, but they're going to research it online before they come into the store. For me that was the first step, is we at least need to get the shelves stocked on the website and show the product that we have. Once I realized that could be step one, and if we sold 20 more kayaks a year, it was going to be worth the investment that we put into it, I hired somebody full time for the website and I've never looked back from there.Stephanie Postles:That's great. So now are you more 50/50 with like retail versus ecommerce sales? Or what does it look like today a couple of years later?Nathan:In 2020, we're almost exactly 50/50 again, coming from less than a percent five years ago.Stephanie Postles:Wow. Very cool. And I'm guessing the whole pie also increased. It wasn't like, "Oh it cannibalized retail-Nathan:No.Stephanie Postles:... now you're getting more access."Nathan:Yeah. If anything, I think it helped local retail again, just letting people in our area know what we have to come into the store for it. It was easy for them to research something on Amazon, but then if they were just like, "Oh, I'll buy it on Amazon rather than coming to the store. Now, we've got the website that they can research it on our site and either come into the store or buy. So I think the local market it's helped especially with COVID for people who still wanted to shop with us when we're closed. It absolutely helped. And then it opened up the infinite market share of the internet basically.Stephanie Postles:Yeah. So then you had to start finding new acquisition channels to connect with people online where maybe you're used to the more local scene, like bringing people into the retail locations. Tell me a bit about how you had to shift your mindset around gathering new customers that maybe you weren't tapping into before, or even knew how to connect with?Nathan:Yeah, I think it happened organically. We didn't really do a lot of paid advertising. Initially we had a pretty good social presence that we were doing and I think the product of the website was really good, but we really didn't do a whole lot of paid advertising right away. And I think for us, it was finding niche markets online that we could play in. And we've been a store that's always carried unique and hard to find items, and it was trying to figure out what those unique and hard to find items were online that people would come to our site, experience our site, like it, and then maybe come back for something that wasn't quite as niche because they had a good experience with us.Stephanie Postles:What are some unique and hard to find products? I'm trying to imagine, like in the outdoor world and like what's unique.Nathan:Yeah. I think we had like some ... I think a lot of it was at first we were a surplus store and that was Army Navy surplus, but it was almost like how can we transfer that to current goods? And maybe it was a last year model of tents or maybe it was a last year color of a Patagonia something, and we had that and we might be the only one that had it left. We could probably offer it at a discount because we might have bought it at a discount as an overstock, and I think that brought a lot of people in initially and it's still part of our business model. Not all customers need the latest and greatest of something. Even in the outdoor space for things are fairly technical, it doesn't change a whole lot your year over year. So if we could offer that value to our customer of something that REI didn't have, or another big player didn't have that drew people to our website just like it has our stores.Stephanie Postles:Yep. You guys have a lot of good brand partners. Did that get accelerated once you had an ecommerce presence, or did you always have a lot of partnerships even before that?Nathan:We had a lot of great partnerships honestly. Even some of the bigger brands we work with are still family owned and operated businesses, so we kind of always had that tie. But I would say the businesses that we had the best relationship with are the ones that we grew online, the ones where we could sit down at a show or have a meeting and say, "Okay, here's your business strategy? Here's our business strategy. How do they align? What can we do?" And those conversations have resulted in growing the business with some of those brands 10, 20 times over in the last couple of years.Stephanie Postles:Yeah. The one thing I'm thinking about is like with a company that has a bunch of products and brands that they're curating and selling, how do you keep your customer to keep coming back to you? I'm imagining, okay, I go and I buy a Patagonia jacket from you guys, and I had a great experience, but then maybe in I don't know, three or five years when I want a new one, how do you make sure that I remember you instead of just going to Patagonia and just buying directly from them?Nathan:Yeah. We have all the traditional things where we'll put a thank you 10 coupon in the box, and tell a little bit of the Sherper's history. We'll get them on our email blast. We'll try to get them to follow social media. But I think the big thing is again the customer service piece of it. Our ecommerce team is two people, so you're going to get somebody who knows what they're talking about. They've been with the company for a long time now. If there's an issue, sometimes it gets bubbled up to me and I'm actually dealing with the customer. It's still that there's a face to the name when you're dealing with us, and I think people appreciate that. If you look at our Google reviews, anything that has to do with online, they're like, "Wow. I was actually able to talk to a person. I was actually able to talk to a person who had used this tent.Nathan:I was actually able to talk to a person who could fix my issue." I always want to stay in that sweet spot where we're still that small local family owned and operated, I think no matter how big we get online, that has to still be there. And I think if we were ever sacrificing that for volume, we would lose part of our competitive advantage. I don't think I would ever want to do that.Stephanie Postles:Yeah. I love how you guys lean into the story and go all the way back to the early days of like how it started. I want you to tell a bit about the name and what happened, of like why your last name does not match the company's name, and just like how you lean into that story to really ... Yeah to me, it sells the vision of the company and makes me connect more than I would with maybe another brand that doesn't have that same kind of story.Nathan:Yeah. So that's one of our favorite stories [inaudible] customers too. So my last name is spelled S-C-H-E-R-P-E-R, Scherper, and the store is S-H-E-R-P-E-R. And the story goes that when my great grandpa's Sam went to open up the first store location, the last thing he bought was the sign, but he didn't have enough money left for a sign that would fit enough letters for the full, last name. So he dropped the C from the name and it's been the same way ever since. And for us, like that resonates with me, because I just think of like my grandpa and my dad just being super frugal and watching expenses, and making sure that you're not overextending yourself. It's evolution not revolution as we go forward.Nathan:So like that sticks with me and then even just our surplus nature and off-price nature, sometimes it doesn't need to be perfect. What is the cost benefit of entering into something? It might not be the best and brightest, but does it work and can you afford it? Okay. Go for it. And so that resonates with me too. We have a section of our store that we're just starting too, that we're going to call The Lost C. It's the C that we dropped from the name and it's our clearance and off-price section in the store to play up just that savings mentality.Stephanie Postles:That's great.Nathan:It's been a message that stuck with me, for sure.Stephanie Postles:Yeah. It's fun that you're finding new ways to incorporate the story and not changing it, but finding new marketing ways to sell the story and connect with the consumer now, that might be a little bit different than what people wanted to hear about back in the '30s and '40s. How do you find ways to capitalize on that and sell it in a way that is still is highlighting your company and the great products you have, but also is making sure people continue to hear about what's behind the company? And like you said, the clearance thing, that's such a good marketing tactic and would easily pulled me into this story where a lot of people don't have that advantage.Nathan:Yeah, so I think, again, it's just like, we are a small locally owned and operated store, and that's always been a message, I think as of late, and especially during COVID I think that was a message. But I think people realize that they can get a different level of service from them than they can the Amazon's of the world. And like, yes, Amazon is always going to win, or most of the time they're going to win on the speed, but they're not going to do certain things. And one of the things that happened during COVID that we had always done, but we played up is we sell canoes and kayaks while we were shut down, we did free delivery of all our canoes and kayaks within a 25 mile radius around the store. And actually it ended up probably being 100 or 200 miles in some cases, and my brother and I just delivered boats to people.Stephanie Postles:Oh my gosh.Nathan:To keep things going, we had a one trailer, we bought another trailer, and as people were buying boats, we said, "Okay, yeah, we'll be there tomorrow. If you buy it now I'll have your boat there tomorrow. You don't have to come to the store. You don't have to worry about the rack for your car. Pay over the phone and it'll be there tomorrow." And Amazon can't do that. Walmart can't do that. There are places that can't do that. So us being small and flexible and being able to do that, that's still, I think how we can win and have that competitive advantage.Stephanie Postles:Yeah. And how many retail locations do you all have right now?Nathan:We have three brick and mortar. We had two when I started and we opened up a third in 2018.Stephanie Postles:Okay. Next I'm thinking about you and your brother trying to deliver all these boats and that's wild. It also seems like you have to have employees of a certain mindset. Even when you're talking about the store owner or manager who was like doing your website, that seems like such a different employee than maybe other retail locations have access to.Nathan:Yeah.Stephanie Postles:Or delivering boats.Nathan:You hit it on the head. That's exactly it. Everybody's day is different every single day, especially as the owner and president my day changes all the time, but our ecommerce person, if we get 16 pallets of deliveries in one day and we've got to fit them in the background, she's down there unpacking boxes. If somebody is out sick and on the ecommerce team, my manager is filling in. So everybody knows what to do, and that can be frustrating sometimes because it pulls you away from work. I'm not going to say employees are always super happy that they're working on one thing, they get pulled to another, but they're always willing to do it. And that's really how I hired and how the people that have succeeded with us are just willing to do anything on any given day. And we've reaped the benefits from it because there's never, "Oh, that's not my job or I wasn't trained to do that." It's just, okay, this is our company, this is our business. I'll do whatever it takes.Stephanie Postles:Yeah. How are you sourcing and recruiting people like that? Because a lot of people will come into an interview and say, "Oh yeah, I'll do whatever it takes." But then when it gets down to it, I don't think everyone does. So how do you identify that in someone? What kind of qualities are you looking for? What questions are you looking for that'll find people who are new scrappy and have grit and ready to get their hands dirty, but then also be placed wherever. Like what are you looking for?Nathan:Yeah. I think part of it is like we've had some long-time employees. So just yesterday we celebrated the 20th anniversary of one of our employees. He started when he was 55 now he's 75. We've had people for a long time. We've got another employee that's been there for 25 years that are not family members, and a lot of family members have been there for awhile. But I think everybody else is ... I've always hired on personality. I think you can train people most things that they need to know, or if somebody is really a go getter, they can train themselves on something. I think it has been personality. Our ecommerce person as we were going with, she was one of the first people that I didn't really know, and had met off of a job recruiting website, but the interview went really, really well and I liked her.Nathan:She worked for us for about a year and she really liked it. She said, "My husband's thinking of a new career, would there be something at Shepers that you think would work for him?" And I was like, well, I had met him a couple times, and I was like, "Yeah, let's talk." And he was a great guy. She was obviously awesome for me and married to him. So I was like, yeah, let's hire him. We'll figure out something for him to do. He ended up managing like our shipping and receiving department. He's now transitioning over to our website and some of our third party marketplaces. It's just been finding the person and then saying, "Okay, what is your skillset? What are you willing and able to do? And here's the job and it's probably going to change next year, and as long as you're willing to do that, we'll keep growing."Stephanie Postles:Yeah. I love that. It's more focused on yeah personality and mindset, and as long as you can learn, you'll be good, so yeah [inaudible]. Hang on one sec. When you're thinking about ... When I go back to like COVID questions, which I've avoided those, but for you guys, it seems relevant because outdoors expanded a ton, everyone was doing outdoors things. I'm sure you guys grew a ton. What were some of the challenges this past year and a half or so around probably getting a lot more interest in sales and new customers coming in and inventory things? What kind of challenges did you guys experience?Nathan:Yeah. Like to take one step back, the first challenge was March of last year, are we going to be around for another year? I think that was the big thing. I had a date on the calendar where it was like, okay, if we can't do the revenue that I'm expecting us to do what we're going to do. And then all of a sudden it was with this boat thing, I was talking about the deliveries. I was going into the store and just doing some things at the store, paying bills and get ready for when we would open up, and the phone was ringing off the hook and it was ... I was just so upset that I couldn't reach those customers, so I ended up having the phone at the store rerouted to my cell phone, so I was getting all the calls.Nathan:All of a sudden I was like every day somebody was like, "Do you sell kayaks? Do you sell kayaks? Do you sell kayaks?" And for me it clicked. It was like, "Oh my god, this is all anybody has been to want to do is go outside." So probably two, three weeks in the lockdown, I was like, "Okay, we need to beef up. We need to go after this inventory." I hadn't canceled any of my orders because I didn't want to do that to my vendor partners. I wanted to see what was going to happen. And then all of a sudden I got on the phone with them and I was like, I want to double my order. And all of them were like, are you crazy?Nathan:Like everybody is canceling their orders right now. And I was like, no, this is going to explode. So it was just getting all that inventory in. Luckily we had the inventory to do it because there was a couple bike stores in my town that they were out of bikes by the first week they opened up. So although the industry was doing well, they couldn't get the inventory and they had to basically shut their stores down again because they didn't have anything. By that, like, "Okay I want to know what people are calling about. I want to know what my customer wants." Like, that's always something that we put at the forefront. And when I found that out, I was like, "Okay, we've got to double down on this."Stephanie Postles:Yeah. Do you think that would have been something you would've learned from maybe your customer support team or other employees, or is that something where you were like, you really just need to get in there and get your hands dirty for maybe twice a week, every quarter, have calls come to you, so you hear the trends and can stay on top of things?Nathan:I think both. I think I have a great team and I think they use their ... They're all super, super intelligent people and a lot of times bring stuff to me that I'm not saying. I think that it probably wouldn't come to me, but I think experiencing it myself, especially in a time with so much uncertainty and especially when everybody was worrying about everything, I don't know if an employee would have come to me and been like, "The phone's ringing off the hook, you should order more kayaks when you're not generating any revenue and paying us all our paycheck right now." I don't know if anybody would have come and told me that. I think in that specific instance, I might've not have had the confidence to say, "Okay, let's go after this." If I hadn't done it myself.Stephanie Postles:Did you experience any issues with like the supplier running out of inventory? Because it seems like it's such a [inaudible] of like sure you can order more, but then if they didn't order more of their parts and they were maybe planning for a pullback that could also negatively impact you guys.Nathan:Yeah. Honestly, I would say it's impacting us more this year because we're finally feeling it. I think I was able to scoop up a lot of the inventory that maybe people canceled last year and we were able to get, and then I think when everybody realized it there was ... the industry boomed and I think those suppliers probably didn't have as much on order as they thought. And then just everything that's happening with shipping and logistics and the nightmares that are going on right now with that, it's been tougher to get inventory. It's finally catching up to us, but I think since we were the ones who supported those companies before and supported our vendors before and have good relationships over the past years, they're definitely doing everything they can for us. Whereas some other retailers might not be getting quite the same treatment and I'm super appreciative of that.Stephanie Postles:What are you planning for, for the next couple of years now that I feel like you were a little bit ahead just because you were able to see what your customers wanted, you jumped on it really quickly. Now, I'm like, well, let's peek into the future. What are you guys planning for now in terms of [inaudible]?Nathan:I think luckily we were already doing a lot of the things that the big guys are trying to pivot to, like the buy online pickup in store, or the ship from store. Like we didn't have a distribution center so we shipped from store. We pulled product off the store and we shipped from store. So all of that stuff that has these fancy names and acronyms, we were already doing just out of necessity. Curbside pickup we were already doing. "Yeah. Okay yeah. We'll take something onto the parking lot, and put it in your truck." We've always done that. I think that stuff, I think we're going to be set for.Nathan:I think it's just looking for, from the ecommerce side, I think it just additional channels to sell, and things are changing so rapidly just with different marketplaces and how you can sell on social media, and just making sure we keep up with that and making sure that the brands that we do have good relationships with, are we doing them the best service? Is their product getting out there in all the different ways that Sherper's can get it out there and continue to grow with them that way?Nathan:I think that's going to be a big piece. And then for us being small independent retail stores in small local communities, I think we're going to see a boom when everybody feels like it's safe to go back out and shop again. I think, yeah, maybe people aren't going to go back to Walmart or Walgreens or those places quite as much because they learn they can buy online and get their necessities there. But I think the like, "Oh, it's a nice sunny Saturday, let's go shopping in one of our towns and hop around and go eat at the local restaurant." Like I think we're going to see a resurgence of that too. So I think some of the more mom and pop small downtown middle America stores are going to see a little bit of a resurgence. I'm excited to see that too.Stephanie Postles:There's definitely a lot of pent up demand I think for people wanting to get back in person and be together and experience going to a store and being able to see the curated collections and doing all the things that they haven't been able to do in a while. How are you all thinking about creating that environment or maybe you just leaning back into it when you haven't done it for a little while and doing new things?Nathan:Yeah. I think it's leaning back into it, and I think even just like ... We had decent traffic in our stores. We've got fairly big stores and they're never super crowded, so we've had a decent amount of people come back even after the lockdown. But I think just leaning back into that customer service and just like dealing with real life human beings, I think like everybody's getting zoom fatigue and a little bit of work from home fatigue. Like, yeah, it's nice, and yeah we might want to continue on with it a couple of days a week, but we don't want to be sitting in our underwear at our desk on Zoom five days a week. Like we want to go back to a little bit of normalcy with that. So I think it's the same thing.Nathan:Like, okay, yeah, Amazon was great. The getting grocery delivery was great, but like it's also great to go into a store and talk to somebody who knows what they're talking about, and maybe they talk to you into something that you weren't necessarily thinking. You thought you wanted this tent, but after talking through it with a human being, who's been in the tent, who can tell you their stories of why they like something, that experience you maybe haven't been having over the last couple months. I think just again, leaning back into that is going to be key for us.Stephanie Postles:Yeah, I agree. It makes me think of this one show I watched, I think the guy is like Tim Allen's the name. It was like the whole outdoor world show and they, it reminds me of I forget what the other store is, but I'm not obviously big in outdoor stores, but you walk in there and it's like a thing where you're like, I'm going to spend, it's like Costco. I'm going to come in an hour to walk through this store and see all the new products and talk to people, like I'm committed when I go into stores like that. And yeah, I love thinking about like different partnerships and events and just where the world could be in another, hopefully six months to where we can get back out there and explore again.Nathan:Yeah, absolutely.Stephanie Postles:When you've been going through this ecommerce journey, launching a website, like what are some lessons that you've gotten from going through that experience these past couple of years and what are you doing differently now?Nathan:Yeah, that's a good question. I don't know. I think I've always been like, we need to evolve, I want to evolve, but I've been cautious as we jump into stuff. And I think the biggest thing was trying to figure out what's the investment going to be, and if it doesn't work out what would the effect be on the business? If we through X amount of dollars at something, and that never came back in, what would that happen? And I think ... in one sense, I think it's been good because we've been cautious and the things that haven't worked out that haven't hurt us that much, and the things that have worked out have been awesome, but just continuing to seek those things out and understand what they are, and it's something that just knowing that different things are out there, and are potentials and possibilities is important. So doing as much research as I can in what might help us grow, especially from the ecommerce standpoint.Stephanie Postles:Yeah. So what experiments haven't worked out and what things are you betting big on right now that you're excited about?Nathan:I think the one thing that we did is we went fairly heavy into pay digital advertising at some point and we still do it, but I think ... kind of like we were talking about how can we win against the Patagonia selling direct or Patagonia and REI? Well, we went after that one point and pretty quickly I realized we can't compete. Like we don't have the advertising budget to compete on Patagonia's number one jacket. I think that was probably one of the biggest lessons that we entered into and said, "Okay, although that's working for some of the big guys and people are ... the Google shopping ads are huge for some people that wasn't going to work for us. I think that was probably the biggest learning. I think for us, it's looking at just technology, that's going to help us scale, and help us still have the service level.Nathan:We do still have the feel that we do, but be able to handle some of the backend logistics. I think that's the biggest thing we've made. Last year we made a decent amount of investment in it, and then coming out of COVID, we've made a little bit more investment in some of those things, just to have us be able to handle the volume that we saw over the past year.Stephanie Postles:Yeah. Are you looking into different types of content? Because to me that feels like a more level playing field now where you can compete against the bigger brands, because it's essentially like who's more creative? Who has the better TikTok videos? Who can hone in their community and their tribe to follow them wherever they go? How have you guys thought about things like that maybe aren't as costly and you can actually [crosstalk]?Nathan:Yeah. I think that's like the biggest low hanging fruit for us. We do a good job with social media, just posting and feeling very authentic and natural. But it's not something we spend a ton of time on. I think it's always like an afterthought and we have Facebook, we have Instagram, but we really haven't started up Snapchat or TikTok. And our customer demographic, at least in the stores has always been a little bit older, so it was like, okay, if we do that most of our customers are going to laugh. They don't even know what TikTok is. But it's how can we get that next customer in, now when we're expanding into the ecommerce world there's a whole huge untapped market there.I think that's a low hanging fruit for us and something that we talk about a lot.Nathan:I think at some point that'll probably become somebody's full-time job. Again, I think that's one of those things, okay, do we want to hire somebody on, have another salary on the books for social media manager? Or can we get by and have everybody do it a little bit? And then what's worked for me in the past is at some point we'll be like, "Okay, this isn't working. We're at the point where we can see we're getting the returns on it. I don't have enough time to do it anymore. My ecommerce manager doesn't have the time to do it anymore. My warehouse manager, who was helping out a little bit doesn't have time anymore, so okay. We need to invest in this person." And we've been lucky because every time we've done that, we'd find the perfect end individual for that. So yeah, I would say in the next year or so I could see that happening for sure.Stephanie Postles:I'm imagining a whole screenplay of like your guys' story and starting up and changing the business, and going through its ups and downs, and it seems like a catchy ... a good product placement type of piece of content to create that would be evergreen and yeah continue to have returns for a long time just because the story is so different than [crosstalk] other brands.Nathan:Absolutely.Stephanie Postles:I love that. Also, yeah. It's fun thinking about all your employees chipping in. Like your warehouse manager doing social media and stuff or whatever it may be, that's great. Did you have to change your backend logistics once you went into the world of ecommerce? Before it sounded like you were pretty local based and you were shipping from your stores. Once you have orders coming in from Florida and California and Seattle, like, how did you think about adjusting your backend to meet those needs?Nathan:Yeah, absolutely. I think it was ... A lot of, it was like research and setting some of those things right away, but usually it was, a problem would occur and we'd be like, "Okay, there's got to be a solution out there to fix this problem." And nine times out of 10, there was, because somebody had experienced it before us because we were a little bit later to the game. But there was a lot that went into it. I think it was 10 years ago that we computerized the business before that it was just like an old register, like there was nothing. There was no inventory, anything like that. So that was before I came in. But that was the first big thing is that we actually computerized everything. And then when I came in, it was switching over our website hosts.Nathan:That was a big thing for us, and our stock and stores didn't sync with our stock online. So working with our point of sale system. We've got a great point of sale system that it's a small, independently owned and operated thing. So if we want anything, we go to him and say, "Hey, we need this to work with this. Can you do it?" And nine times out of 10, again, he's able to do that, so that's been great for us. It was syncing that stock right away. And then I think a lot of it then was on the backend of, okay, how do we manage all these orders coming in from different places with stock being in different store locations, and some of the software that's out there as been great for us, but that had been some of the bigger investments in the last year.Nathan:Especially as volume went up because there were times where you could limp along and we were okay and we weren't making the stakes, but all of a sudden if we were going shipping five packages in my smallest store location to 30 packages a day and there's only two or three employees who are working there, it needs to be as simple as possible to be able to keep up with that. So it's something that came out of necessity.Stephanie Postles:Yeah. Now that you're quite a few years in, if you were to look back from when you're first starting out, what advice would you give yourself from [crosstalk] you know now?Nathan:It's going to be harder than you think it is. I think like-Stephanie Postles:Always.Nathan:I thought it was going to come into this and I was like, "Okay I've got my experience from corporate retail. There's things that like the business is not doing. We're a little bit antiquated. All I have to do is like build a website and then sail off into the sunset and it'll be great. And it was a lot more work than I thought it was. And the corporate world is stressful because you don't have control over everything. But so like it wore on me after a while, but I think having your own business there's things that are better about it, but then there's also things that are a lot more stressful about it. So like when COVID hits, having to worry about like all my employees paying their mortgage and do I keep paying them their paycheck, and things that you just don't worry about when you work for a big corporation. Like the worst thing that can happen is you get laid off and you have a good resume and you go on and you get your next job.Nathan:I think that's been something that I didn't really think ... I knew about it, but I didn't think it was going to be as impactful as it had been over the last five years.Stephanie Postles:Yep. Yeah. It's definitely way different.Nathan:Yes.Stephanie Postles:I as well came from the corporate world and yeah, running a company and having to think about employees and when things aren't going great sometimes, being like, oh this is so hard. Trying to figure out what's the right thing to do, and oftentimes not having a playbook and yeah, it's a struggle.Nathan:And sometimes you don't have as many people to bounce ideas off of, and it's your decision at the end of the day. And if you choose wrong, it comes back to you. I had said that earlier, that's one of the reasons that I wanted to leave corporate America, but that's a tough 11 o'clock PM decision sometimes, and sleep on it one night and then you got to go and buck stops at you so ...Stephanie Postles:Yeah. Yes, I feel that. Were there things that Abercrombie that you learned that you brought into the business, or you're like now I've been in a whole different well, I guess omnichannel world selling online retail, like a big brand. Is there things that you picked up from there that you tried to incorporate into Sherper's?Nathan:For sure. I was a merchant there is what they call it, and it's basically a hybrid between a ... you work with the design team and manufacturer all the clothing, so basically from the sketch phase to when it actually gets sewn in the factory. That whole process was me and then basically the buying. So all the buying really helped out all the retail math and knowledge of how to look at things, and what reports to pull and things like that, that really helped out. But then from that like manufacturing standpoint, that helped me out too. We have some private label goods, so again, being unique and getting what our customer wants. We have a few tents and backpacks and down jackets and things like that, that with some of that experience that we had, I was able to work with some of my vendor partners and manufacturer that and get things that maybe aren't in the market.Nathan:It's not maybe something that's going to sell really well in Denver, Colorado, or Seattle, Washington, where some of these big outdoor retailer companies are based, but in Milwaukee, Wisconsin, this is all anybody wants. So I could go out manufacturer, bring it there, and some of those things have been my best selling items in the store. So that was definitely something that was a big benefit from having that experience at Abercrombie.Stephanie Postles:Yeah. That's really cool. Is that something like the white label products? Is this something you're going to lean into more over the coming years?Nathan:Yeah, I think so. And as we've been able to scale, and as we've been able to scale ecommerce like that's really helped out with it, because in order to do that, you need to order minimum order quantities. So when we were only two brick and mortar stores to 1,000 jackets, that was a huge order and that might last us two or three years, so we wouldn't really see the returns on that right away. But now being three brick and mortar stores and opening up the ecommerce side of it, I can do some more of that private label because I have some in the more buying power behind it, so I can see us expanding on that for sure.Stephanie Postles:Very cool. All right, well 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 a question and you have a minute or less to answer. Are you ready, Nathan?Nathan:I'm ready.Stephanie Postles:Okay. If you had a podcast, what would it be about and who is your first guests be?Nathan:That's a good one. I think it would be about like mental health. I think that's a topic that's become bigger and bigger over the last couple of years, and I think it's important. And I think maybe not as like self-help, but I think just talking about how people deal with certain careers and certain lifestyles, and people who don't have a care in the world, and people who all they do is have panic attacks. I think just talking about how people cope with different things. And somebody ... I'm not a huge basketball fan, but Kevin Love is somebody ... He's a basketball player who's been really outspoken about his mental health and just how he deals with being in the spotlight and having a stressful job. It's not maybe a doctor, but to have everybody's eyes on you and everybody counting on you, he talks about that a lot, and it's cool to see just different people's mindsets.Nathan:So I think he would be somebody that I'd have on and just talk through the process of how do you live life? How do you set your life up for success both personally and professionally, and what makes you tick? I think that would be my focus for sure.Stephanie Postles:Yep. That sounds good. What's the nicest thing anyone's ever been for you?Nathan:Ooh, that's a good one. I would say probably the, just like the support of my wife. She's in the other room right now and letting me do this. We're on our first day of vacation, so we got married ... We got engaged, married, and now we're pregnant in the last 365 days.Stephanie Postles:Wow congratulations. That's interesting.Nathan:Yeah. So I think just like the sport, especially over this year, just being there for me, it's being the spouse of somebody that has their own businesses is probably the hardest job, and the second hardest job is having your own business. I think just like being there for me and being that support system has been awesome.Stephanie Postles:Yeah, it's so needed when running your own company.Nathan:Yeah, for sure.Stephanie Postles:What's one thing you don't understand today that you wish you did?Nathan:Cryptocurrency. I get it, but I'm just curious of how it's going to impact retail. I think just how that evolves and what happens there, and if that's the next big wave of something that really has a huge impact on retail. It'll be interesting to see that, and it's something that I need to keep my finger on the pulse to see what's going on with it, because it is so abstract to me.Stephanie Postles:Yep. Yeah. That's a good one. And the last one, what one thing will have the biggest impact on ecommerce in the next year?Nathan:I think probably shipping and logistics. I think just the cost of it and the complexity of it, and just how that's evolving. I think what you're seeing with Amazon taking on more of their shipping and logistics and continuing to build out warehouse centers. I know Walmart, I think has the patent on a floating blimp distribution center where the drones are flying out of it. I think just what happens in that in the next couple of years is going to have a huge impact on pricing, and profitability, and what consumers are expecting. I think that's going to be the biggest thing this year and probably in the next five years too.Stephanie Postles:All right, Nathan. Well, this has been such a fun chat. Where can people find out more about you and Sherper's?Nathan:Yeah. So sherpers.com. We also have a sister site that's called mkeblades.com. It's where we have all of our knives. That was something that I learned when it came to the store. There's a lot of knife collectors out there, so we have our outdoor hunting knives you would use, but just as people collect coins or cars or anything like that, they love knives as well, so we've got that side as well. And then otherwise we've got three brick and mortar store locations in a triangle around Milwaukee. So if you're ever in the Milwaukee area, absolutely look us up.Stephanie Postles:Cool. I want to come. That sounds fun. Thanks so much for joining us.Nathan:Thank you.
18/05/2142m 17s

Doubling Down: Stanley Black & Decker’s Investment In Ecommerce and Inclusivity

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.---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---Transcript:Stephanie:Hey there, and welcome back to Up Next In Commerce. This is your host, Stephanie Postles, CEO at Mission.org. Today on the show, we have Katherine Bahamonde Monasebian, the President and GM of North America Commerce at Stanley Black & Decker. Katherine, welcome to the show.Katherine:Thanks. Thanks for having me.Stephanie:I'm so excited to have you on. I was looking through your background, like I always do, and you've worked at some really great places. You've worked at Barneys, Juicy Couture, lululemon, ALEX AND ANI. I was going through the list and I was like, "Well, she is a VIP in this industry." I want to hear how you kind of got into those companies and what your journey in ecommerce looked like before getting to Stanley Black & Decker.Katherine:Yeah, sure. I'm always interested when I hear interview candidates and I always knew I wanted to have this career. For me, it was I really didn't sort of earlier on have much exposure really to the broader world or my place in it or even grasp what was possible really career-wise. After college, I actually started off in investment banking. It seemed like a good thing to do, and then that experience actually ended up giving me a great business foundation, but later in my career, I transitioned to ecommerce and worked in a wide range of mostly retail companies, both early stage and mature at sort of different times in their life cycle.Katherine:What I ended up loving about ecommerce is just that it really touches everything, yet really you have to think about the end-to-end experience, you have to be close to technology, you're driven by numbers. You have to execute and it's fast-paced and not the same job twice. I wouldn't give it up for the world. I found my calling, for sure.Stephanie:Yeah, I love that. How did you choose the companies that you worked for?Katherine:Yeah, so I've always been drawn to kind of change roles, so during inflection points in the company's sort of journey. Whether it was an early-stage startup or whether it was a company trying to transform, I was always drawn to brands with the customer at the center looking to grow across sort of new business models and such. It wasn't necessarily a particular affinity to a particular category. I did spend a lot of time in apparel, but it was more about the specific opportunity in terms of scope and ability to impact.Stephanie:Got it. Did you ever get to a company and you reflect back and you're like, "That was one of the most challenging times of like working and trying to either start ecommerce or do something new? Do any of these companies come to mind where you're like, "That was super challenging and hard and the best experience ever?"Katherine:Well, honestly, I would say they all were, whether it was sort of more in a build capacity or more of a turnaround. I think that the last 10 years, a lot has been written about the retail apocalypse, which was like 10 years in the making, but I was sort of living through just these really dramatic shifts in consumer behavior and values. Then, expectations just really rising and companies trying to meet these expectations, which was just really rough structurally. I think all of them were challenging in their own right.Stephanie:Yeah. That's awesome. All right, so Stanley Black & Decker, they are a Fortune 500. I think they're like number 250, 252, something around there, so big company, a lot of employees. They, of course, make industrial tools. You joined during the pandemic, right? Like in 2020, you joined. I want to hear a bit about what convinced you to join a company that also is, to me when I hear about them, like mostly male-dominated. Coming from apparel and a different kind of background, what was that driving force to join Stanley Black & Decker?Katherine:Yeah, so what drew me to the company was really just these incredible brands, so for those who don't know, like DeWalt, Craftsman, Black & Decker, Stanley, Lenox. I'm sure I'm missing some, but just this company that's just this powerhouse, number one in the industry. Been around for almost 200 years, which means you have to innovate to be around that long, global, 60 countries.Katherine:All of that, sort of the benefits of a very well-run, profitable kind of performance-driven organization, but also at the same time, and I didn't appreciate it as much outside-in at the beginning, but really looking to transform and at this scale. A lot of the skills that I picked up through retail, the hitting from consumers from every angle, sort of managing, again, the technology and the data and the marketing and sort of the consumerization that took place in retailers being able to apply that skill set to manufacturers who are now at the tip of the spear I thought was just really exciting for me.Katherine:One other thing that I think we're very proud of is just the company's focus on purpose and just diversity and sustainability and all of the things that you can put a list on the wall that are really embedded in the DNA and the culture of the company made it just really attractive. You mentioned the male-dominated and you're right, manufacturing and tools specifically are like being a pilot or being in technology. They're just not... The typical female representation isn't as high as other industries, but coming as a woman in a senior level from a different industry and I'd really not had any challenges. The tone is really set at the top and the company's consistently ranked as one of the best employers for women.Stephanie:Wow. That's awesome. Did you kind of have a handy background before you entered there? I heard all of the names that you were saying and I'm like, "I feel like I might know what that tool is," but I'm just imagining my Dad right now with a tool belt. I'm like, "I can't really figure out which one that is. Did you have a background in that? Or was it completely new coming from like the apparel scene before this?Katherine:No, it was actually completely new and to add to that, I live in the middle of Manhattan, so I don't really have a yard. The elves kind of... When something's broken, you call and the elves kind of fix it-Stephanie:Yeah [crosstalk]-Katherine:... so it was a steep learning curve, for sure, in terms of product, but having one two or three in every category that we're in, so that helps. Just being number one helps, but it was from a product perspective quite a leap from apparel.Stephanie:Yep. Yeah, I think my three-year-old knows more names of tools that I do and he'll correct me. Anything with trucks, he's like, "That one is not an excavator, Mom." I'm like, "Okay. All right, that's like some kind of ratchet. All right, thanks, Raisin." What did your first 90 days look like at the company? Did you go in with a plan? Were you like, "I've done this before", and then it went as planned? How did you think about when you first joined?Katherine:Well, I mean, the skill sets, as I mentioned, are highly, highly transferable, but my role was new to the organization and I definitely took the time my first few months to really define my scope and really understand our operations, dive into our business. Our goal, which we said publicly, is to more than double our online sales in just a couple of years, so it took a lot of sort of diving deep into our commercial accounts, marketplaces, just looking at our social and customer touchpoints, new business models, B2B transactions and such. It was a little bit of a sort of listen and learn at the beginning, and also just the way to go to market is very different from a retailer where you manage everything.Katherine:In my prior roles, I had technology, I had marketing, merchandise, I had the entire piece of the business, going from that to highly global and matrixed organization. Just a very different way of operating. The same sort of end experience, the customer at the core, and the same objectives, but a very different way of execution.Stephanie:Yeah, and I was looking through one of you guys' investor presentations where it's talking about the model for like, "We're focusing on B2B, B2C, and like C2C, and we're thinking about all of those as being where we want to head over this next year." How do you put on those different hats? How do you meet all of those customers where they want to buy it?Katherine:Yeah. You know, prioritization is a big one in terms of, how do we look at sort of all of the different potential value drivers? How do we prioritize against the high [inaudible] ones? We are definitely looking at basically doubling down with our retail partners and then also exploring kind of new business models, but there's a lot of like foundational work, which isn't the most glamorous or strategic. We're doing a lot of just capability building to enable the scale that we want to get to.Katherine:This is like our studio and our content, our analytics and reporting, demand planning, customer service. We just are putting in an entirely new martech stack, so there's a lot of... It's beyond just the stated intention. We're actively investing against that foundation that will then enable all of those different business models that you rattled off, B2B, B2C over the course of the next few years.Stephanie:Yep. What fell... Around all of the new things that you're implementing, it seems like all of that would be new, kind of like your role was new in this company. They didn't really have a big focus on this beforehand. Which parts do you think are going to be... I'm sure they're all very important, but which ones are you most excited about and you're like betting big on right now? You're like, "This is going to change the way the whole company operates," or, "This is going to see the biggest ROI when it comes to online sales and whatever it may be."Katherine:Well, we have, again, as I mentioned, a very broad scope that ranges from looking at things like content and dropship to some, again, social selling and distribution and, again, doubling down with our key partnerships in North America, which are exceptionally strong. The one that I'm very passionate about is content and I know that, again, it's sort of like just to play, but for us it's very important in that customers and the end consumer now looking to manufacturers just to really understand the product.Katherine:So much of the role of sort of digital influence with now post-COVID, it's estimated to be even higher the number of transactions that begin on digital channels, regardless of where the actual transactions is made. We have a very big investment in content. This includes sort of what samples we shoot off in the milestone process to how we deliver that content to all of our different distribution channels to more enhanced and experiential content. It's a very big undertaking for the last I would say five months, and we're expecting to start to see results in Q3 of this year.Stephanie:Oh, cool. We've had a lot of brands on here talk about content. We've got brands who are making their own branded content, like working on Netflix series. We've got brands that are building their entire content platforms, kind of like a Netflix, but they're using AI and ML and it's being trained and all of that. It feels like it's just kind of like Netflix. Other people just focusing on TikTok or Instagram. What do you think is going to be most impactful? You said you were going to start seeing results. What kind of content are you guys really leaning into? Who is it going after? Who is it targeting right now?Katherine:Our customer base spans professionals, the pros, to tradespeople to DIY makers, so we have diversity in terms of who that end user is, but as I mentioned, they're all looking for inspiration, education, product information, pre- and post-customer care. We are starting with the basics or sort of what our ecommerce core/ecommerce content is. We have a lot of A/B testing happening right now to really understand the true return. With our scale, it's less intuitive than you're being at a more early-stage company where you kind of have line of sight to the full business. We really have to look across all of our different distribution channels globally to really understand what the right investment is from sort of a sales lift perspective.Katherine:We are looking at enhanced content, which is more along the lines of what you were saying, sort of borrowing from some of the learnings we have in global markets, which are more advanced than we are progressive in terms of mobile and social and such. We're really looking to kind of disrupt ourselves and to take a fresh look at how we represent our brands online and how we go to market.Stephanie:Yeah. It seems like there could be such a big area for impact around partnering with all of the DIY kind of people, the Chip and Joanna Gaines, like all of the influencers. I mean, there's this one woman on TikTok that I watch where she'll redo someone's entire bedroom, and I watch her and I'm like, "What exactly were you using to get that? Just tell me exactly what it is and I'll just get that and I'll know it'll work." It seems like there is a lot of opportunities popping up now that are outside just the traditional TV ads, which still apparently work, at least from what I've heard on here. There's a lot of little micro opportunities that could probably have a lot of lift and reach people that maybe you wouldn't have otherwise.Katherine:Absolutely.Stephanie:Are you open to channels like TikTok and things like that? Or are you still kind of staying more traditional like Facebook or even like Super Bowl commercials, which apparently also have big lift?Katherine:The status quo, everything is up for debate. I think one thing that being in a large global, as you said, Fortune 250 company, the stakes are high. There's a lot to lose with sort of our appetite for risk, so it's a constant conversation that we're having. I'm sure other CPGs have the same. I'm just thinking about tolerance for risk like, if you think about it, manufacturing, I have a hundred percent of the information and I have kind of longer lead times and I am very efficient. That's like the opposite of what you're suggesting, which is, "Let's test something out. Let's see if it works, and if it doesn't, then we move to something else."Katherine:Let's work in... The return isn't necessarily there from an ROI perspective up front because we're basically understanding that maybe it's a data play. Maybe it's okay if it fails. All of these things are very, very intuitive for companies that are early stage or that have a different sort of origin and history or are new. I think when you're asking like, are we open to these channels? We're open definitely to the conversation and we are speaking internally and really getting a sense of what our appetite is for risk and how we mitigate against a risk and how we think about investments and how we think about speed as our business model shifts.Stephanie:Yeah, yeah. That's a whole different model and you've got so many eyes kind of watching it like, "How did that pay off? How did it pay off? Let me hear the ROI versus this marketing campaign?" Very different than like a new B2C company that can just move quick and break things and say, "Sorry, later," and no one will probably even-Katherine:Exactly.Stephanie:... notice. Well, the one thing that seems really tricky, too, with a company of Black & Decker's size is attribution around these campaigns. What are some good best practices when trying to measure the ROI of marketing efforts or ecommerce efforts or any of that?Katherine:Attribution is very top of mind. We have a big effort around data and insights, which then goes into AI and predictive analytics, so a very robust effort around data. We've recently, as I mentioned, invested around our martech backbone. This is a CDP, a PIM and DAM, looking at our ESP in our chat and social listening and all of those marketing automation that will help us get smarter about what the impact of our different efforts is. I think we're early in our journey and it is tricky.Katherine:Unlike retailers that you sort of have a lot of the data firsthand, there is a lot of our sales come through our retail partners, so building those relationships with the end user and really leveraging the POS data that we do get is just a little bit of a different exercise than it is in kind of more direct businesses. Attribution is something that we're very keen on understanding, and the goal is to be extremely data-driven and really, again, understand the value, even if it's not a pure revenue so we can prioritize our efforts.Stephanie:COVID obviously made a lot of people want to come home and work on things. Home improvement was spiking. Anything DIY was spiking. What kind of quick changes did you have to make? I'm assuming maybe you came in and you're like, "All right, here's kind of... I'm going to observe. I'm going to see the org. I'm going to talk to the people and then we're going to do this." Then, maybe have to be like, "And pivot again. Everything's up and to the right. Everyone wants to be home right now and fixing their house." What kind of quick changes were you able to possibly make around them? Maybe increase demand?Katherine:Yeah. I mean, you've seen the charts of like the biggest winners and losers in COVID. I think-Stephanie:Yeah.Katherine:... apparel was at the bottom and I think DIY was at the top, so definitely a huge boom and one that I don't think anyone could have really anticipated. We've disclosed publicly like ecom presented 18% of our business last year and went up five points just in that year-Stephanie:Wow, yeah [crosstalk]-Katherine:... so [crosstalk]-Stephanie:... I think I saw 8% back in 2019 was like the share, so that's awesome. Congrats.Katherine:Yeah. Yes, so to your point, it's about meeting that demand, so there's a lot of creative things when you have... With performance market, there's a lot of things you have to do to pivot, so to adjust to the commercial realities, but I think like more important than just meeting the demand, I think what COVID did for us was just like handed us permission to double down, so [crosstalk] an incredibly big base.Katherine:We now have set out to double our business within the next few years and we don't just want to take share. We want to grow the category, and because we are number one globally by a three-times factor in terms of tools and storage, we're in this phenomenal position to really seize the opportunity. We're well positioned. I think it's been shown by companies that act swiftly after a crisis like end up reaping the rewards, so we're not retrenching. We are definitely doubling down. It's one of the biggest commitments and priorities of the company.Stephanie:Yeah, and what about forecasting? I could imagine a lot of people get really excited about DIY. I even think about some of the things that I got and then I kind of was like, "Okay, this seems a little hard." Pinterest fails just running through my mind of like, "I probably shouldn't try this myself." How do you think about forecasting at a time when you have seen all of this really crazy increased demand? Everyone wants to do it now. Are you kind of like going to keep that trend going? Or do you have a point where you're kind of pulling back a bit of like, "Okay, things might normalize a bit?" Or, "We need to think of other ways to increase the lifetime value, reengage these people, bring them in in a different way? How are you thinking about the next year or two?Katherine:You know, I get asked that a lot. What is the future? How much of this is sort of permanent? What's going to stick and what's going to not? When do you kind of shift strategies to exactly along the lines that you're saying to more of inner retention, engagement, and loyalty and such? I wish I had a crystal ball because I do think I'm personally not going to be lining up for Black Friday deals ever again and I'll probably stay in yoga pants, but I personally believe that some of the changes that have been like in ecom, not just our category, but more broadly are really signaling an entirely new phase of growth. I really don't things will ever be the same even after mass vaccination.Katherine:I think we've very bullish internally, that while there may be some shifts like in terms of what we call ecommerce that's kind of hybrid selling. We've seen the curbside pickup and the focus in all of the payment. All of the innovation that's happened at the home centers, we've seen what it's prompted, but I really don't think that we're going to see... I think we're going to see some permanent shifts in terms of digital being that new front door for our category. We continue to remain very bullish.Stephanie:Yeah, yeah. I can see the retailers having to also think about especially around home improvement shifting their mindset. The other day, I was talking with someone who said that essentially contractors were doing buy online pickup on the curb similar to that and that I think it was like a Home Depot or something, all of their employees were trying to get stuff for these contractors where they were on the floor for two hours trying to gather this pretty large contractor's order. It was like, "Well, why would I ever go in or even send one of my employees in there to do that when I can just have the retailers working for me?"Stephanie:We've had some strong opinions both ways around like that's still going to say versus we had on [inaudible] which is like a big HVAC B2B-type company. She was essentially saying that she didn't see big home improvement stores needing to have as much inventory and warehouse anymore and kind of being more like guide shop placing orders online, like, "Why do you need to go in there and find the exact screws or plumbing pieces that you need? It should all just be ready when you get there." How do you view the world of retail when it comes to that?Katherine:When it comes to like B2B, which is that's what that is, like the pro and contractors and such, I think that it's like 70% of the workforce is going to be Millennial and Gen Z and these people that are making the purchasing decisions, they're not going to do it old ways. They want the experiences that they have in their personal life when they get things quick and convenient and have price transparency and can do it 24... All of the things that sort of B2C has sort of led the way.Katherine:I think the next frontier is B2B in that way, and so I think that maybe it's not that specifically, but I do think that retailers will have to continue to reinvent and meet these very difficult expectations. I think that what we've not kind of put in a box, like curbside versus... That is kind of going to get very, very, very blurry, and even the attribution of what we call ecommerce is getting very blurry, which makes determining investment return very, very difficult when you think about things like content, you know?Stephanie:Yeah.Katherine:It's not really the return on the ecom transaction, so I actually think that there will be continued kind of shifts in expectations and that a lot of this behavior will take on a form that we can't even envision now. I think the next five years are going to bring unprecedented change.Stephanie:Yeah. I always continue to think about the role of curation with these especially huge stores, like the Loweses, the Home Depots of I want to go in there and have an experience and I want to get something there that I can't get online. I can get online and order whatever tools my TikTok video told me to get, but what I can't get is if I go in there and there is like certain reviews or little maybe like scan this code and you can see a certain video that you wouldn't have seen otherwise, or just thinking of ways to keep me engaged and walk away with some kind of experience or having some kind of curation in retail that I couldn't get online.Stephanie:I think, why even go to the Pottery Barns or the West Elms? Even sometimes T.J. Maxxes because certain ones have certain kinds of curation. I think that could be big thing going forward, but feels really hard to crack that. I even think about the Amazon Bookstores when they had the little reviews from the individual employees that had picked the review off of Amazon's website. That to me was very engaging seeing which ones they picked, but then thinking about how to scale that and stay on top of it feels hard.Katherine:Yeah. You need something different, which is why I think there's going to be a lot more innovation, or there's going to be services. What is the new mall? You know?Stephanie:Yeah.Katherine:Is it a place you go with your family to feel like [inaudible] fun from the day? You see like precedents in China and other areas of what shopping really is, but I think what makes it hard, back to your comment about attribution, is now the consideration and the purchase are not linked, so it makes it even harder because you've got all of your inspiration and everything online, and then you're going in store not to sort of consider and browse and be hustled. You're going in with more intentionality potentially, so it's created these very strange journeys that are just, again, really hard to organize around structurally.Stephanie:Yeah. Oh, that's an interesting way to put it that your inspiration of when you find something is maybe not linked to when you're in the [crosstalk] store. I think about that all of the time, even with recipes and things. It's like I go in there and I'm like, "Oh yeah, I'm going to make this one Thai thing," and I get in there and I'm like, "What am I here for again? Where do I find my tab where my recipe was?"Stephanie:It's how do you keep that person engaged all of the way through to really push them past the finish line and not be like me where I'm like, "Oh, tomatoes. I need tomatoes. That's not part of my recipe, but I just am all the way over in a different aisle and I didn't come here for that. Yesterday, I walked out and I didn't have any of the stuff. I'm like, "This needs to be better, but I don't know how to improve on this."Katherine:Absolutely.Stephanie:It could be anything, though. The one thing I want to kind of circle back to, too, that I didn't touch on enough, but I was just thinking about the female engagement of the workforce, something that is so important, especially around certain fields that maybe are male-dominated. How do you think about bringing in great talent? How do you recruit great people? How do you encourage people to step up? Oftentimes, females... I think I've read a stat when I was back at Google where they said that females won't apply to a job unless they're like 90% qualified [crosstalk] where men will apply when they're like 60% qualified or something, so [crosstalk]-Katherine:Yeah, I know. I've driven past retail. I know retail-Stephanie:Yeah-Katherine:... the [crosstalk].Stephanie:... yeah, yeah, exactly. Like, "I think I've heard of that store before. Apply." How do you think about encouraging badass females to apply and work for you all and be the top place to work? I think you said that you guys are one of the top places to work for women. How do you even go about creating that culture?Katherine:Yeah. You know, this is one that really hits me hard just on the personal level just because I think everyone knows at this point the impact of the pandemic on women and that they could take a long time to get out of this and over like 2 million women just left their jobs.Stephanie:Yeah.Katherine:I think that it's very important half of the talent pool are women. We need those voices in that seat at the table and I really do think women might change the dynamic of Corporate America and was essentially designed pre-technology. When you think about when corporate even offices and sort of structures, patterns of interaction were designed. It was just a completely different point in time, so I think kind of blowing that up and kind of thinking with a fresh sheet of paper is one thing. We're taking a hard look at sort of the future of work and the office and that helps with attracting women who sometimes can't reload their family in order to take a GM role of a country or such.Katherine:I think that for attracting incredible talent, we have had a big effort and I think that the remote work has helped. We've now had access to just incredible talent. I think my team is in 15 states and one Canadian province, so time zones is a little difficult and there are some challenges with building culture and bringing in more junior people and getting them acclimated. There are some challenges, but I think that's a big piece of it. I think the tone just has to be set at the top. I don't know that you can like dictate a culture and you kind of have to live it. The fact that our leadership team has made it very, very clear unapologetically that we stand for nothing other than gender parity, than social justice. We had empathy principles.Katherine:I told my husband I thought it as the most... I told him, "You've got to be kidding. This is incredible work-life principles that the most senior leaders had made like very public pledges to really respect the folks who are bearing the brunt of the pandemic in many senses and so we don't lose that talent." I figure there are a lot of different sort of angles that we're pursuing as a company from flexibility to return to work after two years off to a lot of more formal programs, but I'm not sure that you can... I think a lot of it is just sort of cultural and the tone being set and the overcommunication about how the values that, I guess, we espouse as a company.Stephanie:Yeah, I love that. I think also, like you said earlier, empathy is such a big thing because you can have messages from the top about what's okay and flexibility and all of that, but a lot of times, it actually depends on your coworkers. If I were to say, "Hey," just like right now, "All three kids of mine are sick right now, all three of my kids are sick. I can't come in. What do you feel from them? How do you encourage empathy among all of your employees who want to lift you up and support you instead of being like, "Oh, Steph's kids are sick again, this is like the third time in a month?" Which it may be, you never know, and figuring out how to develop that among your entire team seems like a much more-Katherine:Yeah, and I think-Stephanie:... grassroots effort.Katherine:... what helps is the male ally, so we have something that we really want is to lead loudly. I historically, I have no problems balancing my personal life. "I just have a commitment. I can't make it. I have a conflict, but now I don't." I make an effort to say, "I have to take my daughter to the doctor," and that's okay. It's also like setting the example that your life is balanced with a lot of other commitments and we want you to be a whole person and that our job as leaders is to stop asking women to change, is to let us change make best tap into the diversity of thought and sort of life commitments.Katherine:I think that unless we figure this out, I fundamentally think you can't legislate to get out of the wage gap. You can't have policy... You really need to make real, meaningful changes within the place that we spend all of our time that gives us meaning to our lives. They've shown how important work is to identity and such and really create the space for true belonging.Stephanie:Yeah, yeah. I think also the best companies will be the ones who think long term around that. That's why I always look back at my time at Google and respect the teams that I worked for so much because I remember I was in at the Finance Group for Maps and I was switching over to like a PM type of role for Augmented Reality and Streetview. I was eight months pregnant when they were recruiting me and I was like, "Do you see this? I will only have a matter of, I mean, weeks, two weeks maybe to work with you guys. I'm really interested."Stephanie:They were trying to pull me over to their team, but I'm like, "But I'm only going to be here two weeks," and then we have a very good maternity policy and you get up maybe a couple of weeks off beforehand, is this okay?" They're like, "Yeah, of course it is. We want you long term. You being gone, the company will still run, things will be fine, but we're excited when you get back here and we want you to come back when you're ready and your spot will be here." I just remember being like-Katherine:Incredible.Stephanie:... "Whoa, like that's the kind of [inaudible] long-term thinking." It's not around like, "Oh, it's going to be hard for a couple of months." They give none of that. It's like, "Of course, everything will be fine, but we'll be here when you're ready to come back," which I respected [crosstalk]-Katherine:I do think those are the companies that will win.Stephanie:Yeah.Katherine:Employees will feel like they're a part of something. They'll be more engaged. I don't just think like it's fair and it's the right thing to do. It is a hundred percent of business advantage.Stephanie:Yeah, yeah. I agree. Love that. All right. Well, let's move it over to the lightning round. The lightning round's brought to you by Salesforce Commerce Cloud, our amazing sponsors. This is where I'm going to ask you a question and you have a minute or less to answer. Are you ready, Katherine?Katherine:Oh, the pressure. Yes.Stephanie:[inaudible]. All right. What's one thing you don't understand today that you wish you did?Katherine:Blockchain.Stephanie:Good one. I mean, yeah, so many opportunities there, I think anyways, but-Katherine:Yeah, and again, I understand it at like at a high level, but what are the practical applications in the short term? Same thing with 5G. I also throw that in there.Stephanie:Yeah, yeah. I don't understand 5G. I got a Blockchain [crosstalk] yeah [crosstalk]-Katherine:You're not like a [inaudible].Stephanie:No. I'll let you know. I'll be like, "Here's a TLVR," and make it short. If you had a podcast, what would it be about and who would your first guest be?Katherine:My goodness. It would be about just the topics of the day and I think my first guest would be Dolly Parton. The reason is is that here she was, she had like nothing, and then she became an icon. What propels someone to really... What kind of drive does it take to really leave her very, very humble origins and then sort of build an empire and really have this worldview that she has? I think just really picking the brains of people who have done incredible things.Stephanie:That sounds amazing. What's the nicest thing anyone's ever done for you? It can be life or work.Katherine:Life or work? I would say it would probably be something with... I would say my daughter. I have two daughters and I would say for... I think it was my birthday or Mother's Day, they made Mom Appreciation Day, so the whole day was devoted to me and I got my favorite breakfast. I got to do things that were really what she wanted to do, but that were under the guise of what I wanted to do. She's only four, but it was just very special that she kind of thought of this holiday that would be kind of in my honor.Stephanie:Oh, that's cute because they were getting ice cream. "Then, we're going to have candy, and then we're going to get pancakes [crosstalk] with the syrup [crosstalk]-Katherine:Exactly what I'm [crosstalk]-Stephanie:... "it's your day, Mom." That's so cute. What resources do you check in with each day or week to kind of stay on top of all of the ecommerce trends? What brands do you maybe watch to also kind of stay on top of it?Katherine:Yeah, so it's funny. I always ask people that because there's just so much content out there and I think the curation is the most difficult. I read The New York Times and I listen to podcasts. I like Pivot with Galloway and Kara Swisher. I live The Jason Scott Show. I mostly look to earlier stage brands and companies sort of for inspiration and innovation. I'm not sure what I think about the era of big retail and such, but I think that a lot of what the more progressive pure plays are doing can lend itself to the companies that are at a bigger scale. That's who I look to for more inspiration.Stephanie:Yep. Not bad. The last one, what one thing will have the biggest impact on ecommerce in the next year?Katherine:Okay, so what I think will have the biggest impact in the next year or so is on ecom is just the continued blurring of the lines with score and web. We've seen the proliferation of all of these delivery models. We've seen the impact of social commerce. I just think there's going to be a lot more. I think in the far future, there'll be more off-the-screen IoT. Voice will become more prevalent, all of those kind of... AI, AR, VR, all of that, but I think in the immediate term, we're just going to continue to see sort of these models blurring and the distinction between what is ecommerce and what is sort of brick and mortar continue to become more or less relevant.Stephanie:Yep. Yeah, so basically things start to kind of get bundled together a bit more. Right now, it feels like there's bunch of like tentacles everywhere and you have to keep track of everything, which is why we named the show Commerce and not Up Next In Ecommerce.Katherine:That's why my title is Commerce.Stephanie:Yeah, yep. Oh, I love it. That's-Katherine:Yeah [crosstalk] very progressive, though we're thinking that [crosstalk]-Stephanie:Very forward-thinking. We had our crystal ball. We're ahead of the game. Well, Katherine, this interview has been so fun. It's been great hearing about what you guys are up to at Stanley Black & Decker and all of the cool work that you're doing. Where can people find out more about you and the family Black & Decker and maybe even apply for you team? If I wasn't here, I would. It sounds epic.Katherine:Oh my goodness. Yeah, everyone should want to be a part of it. We're doing some amazing things together. You can reach me on LinkedIn and you can learn more about the company, stanleyblackanddecker.com, but thank you again for the opportunity. This is a really fun conversation.Stephanie:Yeah, thanks. It definitely was. I'll have to have you back for round two in the future. It'd be fun.Katherine:Absolutely. Will do.Stephanie:Thanks, Katherine.Katherine:Thanks.
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