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The Jason & Scot Show - E-Commerce And Retail News

Join hosts Jason “Retailgeek” Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Founder and Executive Chairman of Channel Advisor, as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.
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Dec 6, 2019

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The Jason & Scot Show as been nominated for "Best Retail Media Resource" by the VIP awards.  We'd appreciate your support, if you could take a minute to vote for us.

Adobe Recap

Taylor Schreiner is the Director of Adobe Digital Insights. He uses Adobe's data to give us a recap of the Cyber 5 (the five shopping days from Black Friday through Cyber Monday, this year Nov 29 - Dec 2).

Adobe Holiday Dashboard

  • Thanksgiving  11/28 - $4.2B (up 14.5% YoY) below forecast of $4.4B
  • Black Friday 11/29 - $7.4B (up 19.6% YoY) below forecast of $7.5B
  • Saturday - 11/30 - $3.6B (Up 18% YoY) at forecast
  • Sunday - 12/1 - $3.8B
  • Monday - 12/2 - $9.4B (up 19.7% YoY) at forecast

Don't forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.

Episode 202 of the Jason & Scot show was recorded on Wednesday December 4th, 2019.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott Show. This is Episode 202 being recorded on December 4th 2019. I'm your host, Jason Retail G. Goldberg. And as usual, I'm here with your co host, Scott Wingo.

Scot:
[0:39] Hey, Jason! And welcome back, Jason Scott. Show listeners we are in the thick of holiday 2019 and are really excited tohave back on the show.
Adobe. And I think this is the fourth time. In fact, check me on that. Jason had one of the interns check.

Jason:
[0:54] I I actually had one of the interns in you. That number. So yes, it's right.

Scot:
[0:58] Good. All right. Pre pre fact checked. We're getting pretty. Ah, reliable here of Jason Scott Show.
Um, this year, representing Adobe, we have Taylor Shiner. He is the director of Adobe Digital Insight's Welcome Taylor.

Taylor:
[1:12] Thanks for having me. Guys. Appreciate it.

Jason:
[1:14] We are excited to be a tailor and a sort of tradition on the show. We always like to give listeners a little bit of background. So can you kind of share with us some highlights of your background? And what your role is it it'll be.

Taylor:
[1:25] Sure. So I was the 52nd best chess player in Utah in fifth grade.
Ah, And then from there I went into a career in retail. Uh, I went,
to work on Internet insights about 15 years ago with some of the major Internet players across the industry, and I've been doing that for a decade and 1/2.
And then about three years ago, I found my dream job here. A WNKW Adobe Digital Insight's.
We get to tell these amazing stories about how the digital world works, and we get to tell people about how tech and companies and events are changing their digital lives and companies about how those same trends are affecting how they need to run their businesses.
And we get to talk about retail. We get about time travel. We could talk about a whole host of different things.
It's been fantastic, and I get to work with some amazing data scientists, analysts to develop these insights, and it lets me have conversations like this one with you guys. So it's a perfect gig, and I love it.

Jason:
[2:24] Possum. So, to recap, this is sort of a career highlight for you right now.

Taylor:
[2:28] Yeah, I like to I like to go from Holly Tyler, but this one, I'm loving it.

Jason:
[2:31] Yeah. Yeah. Pinnacle, I like it and I'm.

Scot:
[2:34] Think Jason means being on our podcast. He wants an explicit answer on them.

Jason:
[2:38] All right.

Taylor:
[2:38] Oh, yes, I'll give you a quotable thing. Being on the Jason Scott Show is a career highlight to date.

Scot:
[2:45] Boom.

Jason:
[2:45] That boom. Yeah. You'll see that in the in the preview show. Pretty soon here, Uh, and I'm sure all this insight stuff is gonna be super fascinating. But I have to know first, if you've kept up your chest up chess, it all.

Taylor:
[2:57] Uh, only recently in my eight year old has started to learn to play chess, and he's creeping up on being able to beat me. And that is not acceptable. So.

Jason:
[3:05] Yeah, that's a losing battle. You could probably keep ahead of him for a little while, but I think, uh, there's, ah, natural progression there. That's working against you.

Taylor:
[3:13] I'm afraid so.

Jason:
[3:15] Awesome. Well, let's jump into the data. So we talk about your date a lot on the show.
We already did. Ah, an episode this week. In fact, what we talked about some of your data, and it always falls on me to describe your data set.
And I'm sure I'd butcher it. So, um, here's a chance toe kind of refresh our audience from the horse's mouth. Can you tell us a little bit about, um, what the data set is and how you use it.

Taylor:
[3:38] Sure. So we build a model of US online retail sales based on trillions of Web site visits based on,
tens and back to think over hundreds of millions of skews based on data from thousands of different companies all across the US across.
Ah, you know, a variety of device types.
OS is on other information, and we use that to to plan out, especially on a day by day and occasionally hour by hour basis.
Uh, how we think that that season's gonna go So he predicted all.
And then we go back and we track on a daily in again, sometimes hourly basis.
How US online retail sales go s Oh, it's a big data lift, and we spend all year getting to this point to be able to talk Ah, in almost real time about how how the sales were going.

Jason:
[4:33] I got it. And so just make sure my understands. Correct. So, um, there are a ton of major e commerce sites that use an analytics product called the Dhobi Analytics, which is, if you go back far enough, formally. Ahm nature.
And so it. The core of your data set is in aggregated view of all of those customers that are using that analytics tool for for their e commerce sites. Do I have that right?

Taylor:
[5:00] Yes, sir. The majority of the data that we've got and this is not including some data from the recent magenta acquisition so that there's a whole other set of data sources as well as some other things.
We talk about it on the periphery, but the core of the data that we work with our data from opted in. So companies that have chosen to share data with us, um, and for value that we give them.
And so that shared data Anonima ized before we even touch it and aggregated at a very high level so we can talk about these macro trends, but yes, that's where the data comes from and to be analytics.

Jason:
[5:34] Perfect. And then, um Ah, and that was you already answered.
My fob question in the court date is that you have not integrated any of the new data that you might have access to from Magenta. And if I have it right, you're also, at this point not really using data from the rest of the adobe marketing cloud.

Taylor:
[5:53] E. I wouldn't necessarily say that. So we do. Uh, we do a lot of so we haven't agreed.
A lot of the magenta data allowed us to look at things like shipping and returns that, uh, we're new renews angles for us, and it certainly gives us these amazing to you into that tail.
Set aside some of the bigger players in terms of e commerce, but we also you used the mark enter data for your candidate to look at so are marking channel Information Ad Cloud, which used to be two mogul, which I worked for.
Uh, we used them for some advertising data around Thanksgiving. So we bring it all the pieces.
Um, but, you know, not all of it necessary goes to the top line number. As you as you say.

Jason:
[6:33] Sure. And then, um, you kind of alluded to this, but you're not just trying to report on trends from adobe customers.
You're you're using some advanced math and you do the customers represent a big chunk of the market. But then you and interpret what the total market is based on the subset that you see. Do I have that? Correct.

Taylor:
[6:56] You do. I could spend a whole other podcast on how we do that, but it sze not do that. Yes, it's cool math. We do cool math.

Jason:
[6:59] Yeah, let's not do that. But just call it a cool math.
Yeah, And then the other thing that comes up a lot. And I think you guys are really good in this as well.
Like very often. We talk last year versus this year, and when a lot of vendors report their data, the customers they have this year are different than the customers they have last year.
So when they're when they're talking year over year growth and things like that, it's usually not perfect. Apples to apples.
Um, but because your your, um trying to normalize the data for the whole market before you do it. When?
When you say there is a 20% growth this year versus last year, that's a pretty accurate number. Drab.

Taylor:
[7:39] Uh, yeah, I think you should. It's yet. You said that. Really? Well, that's absolutely That's.

Jason:
[7:43] Perfect. You can use that in your highlights. Now we've reciprocated. Awesome.

Scot:
[7:49] Go. So, uh, now that Jason's extracted his pound of flesh, let's Ah, let's jump in at a high level. How? How would you view Holiday 2019 shaping up?

Taylor:
[7:52] Okay.

[7:59] I think it's been quite strong. And it has been strong all through today.
In fact, if you let me, I'll give you, uh, it as, ah, this morning.
So yesterday's numbers Through the third of December, we saw $84.7 billion in online retail sales, and that's up 14.8% on last year for the same period.
So that's a little faster than our aggregate prediction.
But the way that the bottle is trending that out puts us on target to be about 14.1% roughly on our predicted Taff for the season. So and the 14.1%.
I mean, some listeners and people who visit our website will see that last year was particularly strong of the 16% growth year.
But if you look back a few years just 2016 twice 17 this is sort of on par with those growth rates, but on a much larger base now, as we head into almost $150 billion in sales. So it's it's pretty huge.
Um, the the other tidbit of information I can give listeners about yesterday.
Giving Tuesday is that it was a $3.3 billion day, which is amazing research and account $3 billion days, the way that when I started in this gig, we counted $1 billion days.
So they're coming fast and furious. Now, that's only up about 11% on last year.

[9:23] So, uh, it leaves us open to the question of our consumers.
Have consumers, you know, taking all these early deals on and won't be spent later, or are they just taking a break on Tuesday and ready to get back out today?

Scot:
[9:38] Yeah, let's Ah, so it sounds like we're growing kind of 14% year over year.
Um, if you if you kind of look at the shape of the holiday so far, I know you can't predict. Well, you don't know what it's gonna happen here towards the end. It's kind of gotten this what I would call a U shape where it's being more front and loaded and back and loaded.
So the front end is people that have their act together and jump on the deals.
The back end is like Jason I where we're like, Holy cow. Uh, holiday is here. We should do some shopping on the 23rd.
Um, the, uh does that does that kind of what you've seen and is getting more pronounced. Can you tell if you've seen the front part of the curve?
I saw some data that said, like, Veterans Day was unusually large and like the early November days were larger. You guess? You know.

Taylor:
[10:24] Absolutely so we saw just points on these numbers from this conversation.
If you look from the beginning, what we call the beginning seasons of the person November roughly right to, um, Wednesday, that hole to the Wednesday before Thanksgiving, that whole period Groot. About 15%.
So that's what that was about a point 1/4 faster than we would have predicted.
So angry it. We saw a big lift we saw lift above.
We would have expected in that early season it that seems to be attributable to a bunch of, uh, earlier deals.
We had something similar happen last year, but it's even stronger now where discounts came earlier in electron ICS and computers and televisions.
We also saw that, you know, last year, Thanksgiving itself was a breakout day where you had, despite it can. Suddenly Thanksgiving was growing faster than any other day.
That spike seems to have moved back now to Wednesday, where the Wednesday before Thanksgiving was growing at about 22%.
And I think again, that's attributable to ah, lot of deals moving forward in time. So and to your point, that really changes the shape of the season.
You know, we used to basically tell a story of like, look, everything is sort of lifting around that Cyber Five said. The days of the 757 days is getting a disproportionate share.

[11:41] That's still true, but we're seeing sort of, ah, shift back to earlier sales this year, and that might have to do with the calendar.
But I think it is actually a broader trend of thinking about these pre holiday sales and reality promotions as being think that happened earlier, both for retailers and consumers.

Jason:
[12:02] Yeah, it's interesting to me. It's like, um, it feels like in the beginning of the season, you know, there's there's a lot of retailers under stress and have to have a good holiday. And there's this kind of winner take element mentality.
And so we both see Maura aggressive promotions and discounting at the beginning of the season. And I feel like we also see more digital marketing like more investment in ads and things like that, huh?
That really goosed the front half of that. You, um and then I have a hypothesis.
We'll see if it plays out. But, uh, you know, of course, Amazon has gone toe faster and faster shipping, right? And so that, you know, this would be the first big holiday with with sort of standard one day delivery in various forms.
Walmart, target and some extent, even best Buy have all been forced to sort of match that fast shipping.
So, you know, not that long ago we would have had this this very gentle ramp down of sales as we'd hit shipping cut offs and people would stop buying goods and then they'd just be doing oh, piss or gift cards.
Or things like that because they'd run out of time to get the gifts before the end of, you know, in time for holiday.
But now everyone can be a procrastinator like Scott and I, because so many of the vendors will ship so fast. So it feels like like all of those things conspire together to make the very beginning and the very in these these ah, anomalous bikes or that you shape.

Taylor:
[13:25] I think that's that's gonna be absolutely true. And this this year, in particular with this shift, two more by online pickup in store ah, or clicking collect behavior.
And to these accelerated shipping, it's gonna it's gonna make people think they can wait longer in the season where they can't really wait longer to your point.
You know, it's it's three weeks away before even those things are gonna be, uh, almost too close to Christmas to shop for Thio to purchase with.
And so you know, I think we'll see that ramp up at the end of people. Start to panic a little bit.
And that's also why, by the way, you see jewelry discounts be really strong on, like 20th.
Everybody who's panicked and realize they haven't gotten anything starts. Uh, just looking for something nice and blinking. Tow. Give us a gift.

Jason:
[14:09] Interesting. I was always assuming that people just misbehaved right before the holidays. And therefore it was a Yeah, I have no personal experience or data to support that.

Taylor:
[14:13] You may have a better high pop resistant I do on my own. I would draw my contention.

Jason:
[14:20] Just to be clear, honey, if you're listening, um uh, do you want to jump in to the cyber five, though?
Um, so we just got through those, Uh, can you kind of give us a recap for specifically? How have Thursday through Monday played out?

Taylor:
[14:37] Sure, So overall it's about $28 billion uh, online purchases over that same time frame, and that's 10 almost $11 billion of purchases through smartphones.
So overall it was quite strong. Almost 18% if you like those five days over last year, five days with peaks, you been on Black Friday and Cyber Monday, which always kind of blows my mind because I get the question every year.
Are these days too big to really grow outgrow the rest of the season?
And I convictable Maybe next year they will be.
And it's not not the case, people. Another not only are moving more online, but they're really focusing a lot of those purchases and increasing amounts on those big days.
S o. You know, several money, for instance, this year was $9.4 billion.
So we're almost gonna guarantee there is a $10 billion day, uh, barring anything serious happening next year on Cyber Monday, which is,
incredible, and over 1/3 of that, those purchases are really coming on phones.
Eso you're seeing people not only window shopping actually make purchases on those big days on their phones, especially that's what cyber Monday when people go sit in front of computers at work.
But you know, people under the table on Thanksgiving.
Uh, people on Black Friday we'll pretend to hang out with their family, but but by where? Two things. Anyway, Uh, that's really been a mobile story.

[16:06] And then the other story of the weekend, which I always, you know, you're talking about how, by a and pick up in store, uh is ah, you know, it is a capability that my drive people to wait a little longer for their purchases.
But nonetheless, we saw a big bump in bogus activity.
Even on that, that major weekend without 40% more purchases.
Then we had when we saw last year over the same timeframe, so outstripping overall gross and really pushing both share up.

Jason:
[16:38] Interesting. And so And if I think of it from a historical perspective, you know, 10 years ago a few people had reliable Internet and so, you know, cyber Monday or we'll call 20 years ago.
Several Monday became a big thing, like we'd all enjoy Thanksgiving. We'd go to work on Monday, steal our bosses Internet and go shopping.
And so that was like the one day spike.
And then, as as, uh, you know, we all became ubiquitously online.
The traditional big shopping day Black Friday also became a big online day.
And in fact, I feel like they're often are these forecasts that that Friday is eventually going to surpass Monday online, which seems like, hasn't happened yet. Read joy. I have that, right?

Taylor:
[17:23] But it hasn't quick hasn't gotten there yet. Uh oh, no. Didn't you thought?

Jason:
[17:25] Yep. And then I'll go ahead,
I was gonna say, And then increasingly, those other days in the weekend have grown to be extraordinarily meaningful.
So, you know, frankly, 10 years ago, we talk a lot about cyber Monday.
I actually don't care as much specifically about the results on Cyber Monday, because if it feels like the the aggregate results of the Cyber five is much more important and indicative of how holidays going than any one day in the,
in that block nowadays, is that a good way to look at it, or am I being shortsighted?

Taylor:
[17:59] No, I would agree with that. And I think what's always fascinating to me and is, uh, topic of a longer conversation. Is that to your point?
There's no need necessarily now for Cyber Monday. Everybody's not only got good Internet access at home, they've got good Internet Internet access in their hands.
But we have become so habituated to that day being a major sales day, and both on the consumer and the retailer side that it continues to grow on.
The psychology of this often drives a lot of the behavior even beyond the pricing or the deal's or anything that our model might pick up.
So to your point, you know, I think if you just looked at the data, you might think, Hey, look, this is all going to smooth out a little bit.
But people continue to think about those days as the big days to go shopping, Uh, online and offline.

Jason:
[18:47] Interesting. So you're saying people might be willing to go shopping even when it's slightly irrational? Interesting. No.
Thank God for that, by the way. Yeah, and along those lines, it feels like folks have been trying thio kind of make hay in some of those other days.

Taylor:
[18:54] It's a new fighting I came up with. Yeah.

Jason:
[19:04] Like for a while now, that that Saturday has been small business Saturday.

Taylor:
[19:09] You okay?

Jason:
[19:10] Andi, I think there's a couple of people trying to grab Sunday now, too, right? It is. I'm trying to, uh.

Taylor:
[19:15] Yeah. Super Sunday has a bunch of different cuts at it.
Exactly. And there are big days. Now we're talking about, uh, you know, there, there.
Three and 1/2. Almost $4 billion each.
This is It's massive any other day of the year and we would be having a conversation about a particular $3 billion day.
But they just come fast and furious between November and Christmas.

Scot:
[19:42] Do you do? You have? Ah, At the end of the season, everyone has a different word. Just be like free shipping day. And then I think it's called Green Dares. But you guys, what is what is last year like? Was there a bump? And is it? How does that compare to, like, Cyber Monday?

Taylor:
[19:51] And.

[19:58] So we said we would see ramps toward the end of last year, and I don't have the last little couple days to hand. But they were more closer to sort of Super Saturday and or even smaller than that in the $2 billion range.
Um, as you had in there. They're not the ones bigger ripped last year, but two earlier point.
I'm really curious to see if we don't see a big bump. Uh, come to the 20th 19.

Scot:
[20:24] Yeah. Hey, this is just kind of came to me. So it's if you don't have an answer. I understand. So last year we grew 16%. This year we're growing 14.
Where do you think that 2% Delta is coming from? Is it just kind of across the board, or is it a certain category underperforming? You have any Any thoughts on the.

Taylor:
[20:44] I have some thoughts, and I think it'll be really interesting conversation to have in a few weeks.
But the the, um, the couple things, first of all the models telling us 14 ish, Um, my gut says there might be more upside risk there than downside.
So somebody get my clothes.
What seems to be the case so far in the data is that there wasn't proportionately even bigger push into the early season.
Um, because of, uh, a CZ people moved into Thanksgiving on on that Wednesday, some of his deals move forward.
But honestly, if you just if you just look at the math, which is, uh, what we particularly good at,
the just pushing the season shorter between Thanksgiving and Christmas is about a $1,000,000,000 which is, you know, 50 bases, 50 of those basis points, uh, arm or sorry on its own.
So between a little bit of merging of error and that some of those basis points and ah, uh, and not the shock of all these earlier deals that got everybody accelerated between those three things you kind of get to, uh, the delta.

Scot:
[21:53] So the jury's still out. Kind of depends on how the models perform and how people react to those missing days.

Taylor:
[21:59] Yeah, exactly. If we get a big surge and everybody. Service comes off of the off several Monday and thinks, Gosh, I got a sprint toward, uh, toward River Last shipping days game. I'll be very different than everybody feel like.
Gosh, I blew my budget on all those early deals.

Scot:
[22:16] Yeah, cool. It wouldn't be a Jason and Scott show if we didn't talk a little bit about Amazon.
And I understand if you can't talk specifically about anyone, retailer or whatnot.
But any insights into how Amazons holidays going big, they put out their annual release that said something like Vague like We sold hundreds of millions of dollars.
You know, third parties did great. So so it always befuddles Wall Street when they kind of without these puzzle boxes for them to figure, figure out.

Taylor:
[22:45] Yeah. J. J. Abrams doing the press releases? No, I, uh you said you wouldn't be your podcast if you didn't ask about Amazon.
It wouldn't be a doubIe response. I didn't say we don't talk about particular retailers, but what I can say eyes we do track the biggest and the smallest against each other Really looking at.
Especially as you see two big trends that big.
A lot of discussion about big, big retailers pushing, couldn't collect, pushing one day shipping, having great deals.
Ah, and a lot of democratization of, uh, e commerce. As you know, a lot of art form.
We have five farm, those others that makes that much easier for people to bring businesses to the market.
So those two forces air going on, um, in the on the average, uh, you see big companies outperforming smaller ones in terms of growth.
So if you compare November an average day in November to an average day in October for the big companies they're up about, these are $1,000,000,000 plus companies.

[23:42] They're up about 87% in sales, whereas the smaller companies in the 50 million lower range.
So these are the small ones are up only about 43% and some of it is.
It's coming from the East from the data, at least, is coming from two things. One is the larger companies are much better at mobile conversions, that 80% better at taking a customer and bringing them to purchase on a phone than the smaller companies.
And consequently, they get about 10% more of their share.
Their revenue from those phones and the way that I reviewed the data is that if you're a consumer and you are going to a big retailer, that big retailer has a number of advantages, including a wide set of products wide set of,
promotions generally really good, aye, aye at connecting you with those promotions,
and a really the slick, speedy checkout process that they worked on really hard.
And for the smaller companies, they obviously have quite a selection.
Some of them haven't figured out how to turn customers, uh, into buyers swiftly.
But the last thing I would say this is the most important part about this is I am talking about the averages.
So, you know, in the smaller companies, there's a lot of entry, a lot of people trying things out on a lot of exit, and there are within that average a huge number of small companies who are just blowing the doors off.
It's just that on average, they're not doing as well as the very big ones.

Jason:
[25:09] Sure that makes sense. Um, you talked a little bit about Omni Channel. I wanted to jump into that for just a second.
That seems like an area where, in particular, a lot of the big companies have made major visible investments in their infrastructure.
So of course you know, Target, but shipped. And then now that's heavily integrated. And they have rich like same day delivery and curbside pickup options available across all their mobile platforms.
Wal Mart, you know, has has done a bunch for general merchandise Omni Channel. But even more for grocery, um, and curbside pick up and and all of those things even, um ah, the Amazon.
You know, although much more footprints are starting to get a little better at Omni Channel with their with their small footprint of retail stores, um is any indication of that's paying off?
Like Are you guys ableto to see an Omni Channel transaction versus a pure digital transaction? And is there any like is the rate of growth of those Omni Channel transactions faster than overall?

Taylor:
[26:15] Oh, yeah. So we're we're seeing a Z, said rumor, roughly in the 14 to 16% range growth for the overall market place, but for by online picker in starker POTUS.
Another word that's up but, like 40% for the season. So it's way outstripping overall sales.
And what's also really interesting is we see that this has a little bit to do with larger, so small.
But we see that companies that offer, uh oh, this, uh, 20% better at converting, then companies that don't offer both us.
So people are coming there specifically for that capability, or at least finding that capability incredibly valuable to them.
At my my thought on this is Look, we got a phone in her hand that has moved the display window experience into your hand. It's moved the checkout experience into your hands, and everybody just wants to move that fulfillment.
That one thing in between the human experience, closer and closer and you know, one day shipping is great, but, uh, sometimes it's just easier if you drive down in about 10 minutes and go pick up the thing you just saw and knew you wanted.

[27:25] And plus these guys are. You know what we see in the survey data to is it?
This is good for the brick and mortar stores that not only are they know is you guys know that not only are they making people making purchases online and sitting in the car and getting that that pickup, they're also going to the store and buying another thing, could they thought of it.
I'm driving that That makes it different. Step for brick and mortar stores as well.

Scot:
[27:47] Wrinkle. Um, you've hit on this a little bit, but let's talk about mobile. So, um, do you guys, when I talk about mobile, I tend to take tablet out, and it seems like you do to you. You seem to be explicitly calling out smartphone.
Um, so you mentioned. I think I can't remember. Was it black Friday? You said it was. 1/3 of the sales came from a bull. Ah, talk us through any other kind of insights on the mobile side.

Taylor:
[28:12] Sure s o your point. We tried. We tried crier years to be really disciplined about mobile version smartphone.
We've been a little acts this year because tablets are decreasing share. So smartphone really had started crossed That that 1/3 threshold on major days in terms of dollars spent, it was always has been for the past several years.
The majority visits were coming from phone, so people were doing initiating their shopping.
We had this challenge empire years and still have some do now that they weren't closing the deal.
Uh, from that we'll visit either not at all or going to the desktop to purchase.
That gap continues to close. In fact, on Christmas this year, we expect to have the first day in us where the majority of online purchases actually come through a phone.
As people aren't going to their computers and their families are around, they're actually using boats.
That purchase and the things that are driving this, at least in the data that we see are two really interesting and related points.
One is that time per visit is going down rapidly.
So, consumer, they're coming. They're not messing around.

[29:20] They're looking for and expecting the product that they that they came for at least a product to buy.
And some of that is going to be in part because your connection speed have gotten faster. Screens gotten bigger processes were faster, but also retailers have gotten much better at streamlining that process.
I'm the mobile phone, and consequently, the amount of money that people are spending per minute per second on a mobile phone continues to skyrocket month after month, year after year.
As people just get faster making those purchases, especially with a lot of them. You check out options that make make it easier than, say, trying to type in the numbers on your credit card.

Jason:
[30:03] Fascinating. The, um that would be cool if, uh, Christmas did end up being the first, like, majority mobile day.
Um, I was also truce. You mentioned something earlier.
Um, that sounds like that. I call it a mobile gap when traffic side, but conversions lower.
And it sounds like that mobile gap is getting lower for big companies. And you said it a couple reasons why that might be, um, in general. Do you feel like that?
Like, Is that mobile gap? Um, getting narrower across the border. Is it only for large companies that they're they're being successful closing that gap?

Taylor:
[30:39] Well, I think large companies again, it has to do it so that the broad, um uh, you know, there's a much broader array of outcomes and smaller companies than larger ones, so it's harder to paint them with the same brush.
The large companies obviously have focused on this. Figure it out.
They can track per second per user per region per item, how much time consumers are willing to tolerate and they can achieve those things down.
If nothing else, would I just bring more machines online?
Smaller businesses don't always have that ability, but the platforms,
one of which Toby has but the Platform three Commerce are making that whole process from visit to fulfillment and even marking channel much, much more streamlined, especially for small businesses.
Who, uh, we think about that a little bit and focus on what their consumers experience needs to be.

Jason:
[31:34] Got it. So one A transition briefly to profitability. So last year I feel like the narrative would have been, ah, you know, a big growth year, a jump from the previous year.
But a lot of people felt like it was Ah, that was partly attributed thio heavier than usual promotions, which meant it actually ended up being, you know, not a phenomenal profitability year.
Um, and so this year, we're seeing the rate of growth slow a little bit from last year.
Is there any reason to believe that people are being more conservative on promotions or are you have any insights about how we're gonna come out from promotions and profitability perspective?

Taylor:
[32:18] So, you know, I'll be honest with you were really good about figure out the revenue. We're really good about throwing out prices. We are generally missing that third piece of costs that allows you to talk about profitability.
But I'll tell you what. I was thinking about this this morning and last night and looking at, but began for a bunch of different angles in our data and frankly, that the short answer is the results are mixed.
So we did. If you asked me a week or so ago, uh or even to I would have said, Look, the discount seem to be moving forward, especially in electronics.
Um, and so, you know, maybe the maybe the profit margins are slimming, but then we started. Look at toys and toys. Bottom out, quickly.
Um, uh, you know, maybe once the Toys R Us process was was through the toy discounts didn't go is deep.
This year's they did last year, and we're seeing something we saw. For instance, we elected appliances, appliances discounts for a little later last year.
So exactly how the profit margins are gonna go. Hard to say.
But the, um, you're in the revenue looks really strong.
So, you know, I think the jury is ah, bit out where possibilities go in.
But I don't for consumers see, a year where we're like have massively deeper discounts than the last year. We just have them earlier and on particular product.

Jason:
[33:38] Got that? Uh, that makes sense, and I agree. It's It's really hard to get a clear picture until well after the fact on the promotions, because there's like there's promotions and pricing effects and all these other things.
But one thing that seems like it might be coming to play a little bit more on profitability this year is profitability like there's a couple Evers one.
Is that pricing a promotion? Another is the cost of acquisition.
Um, and I do feel like folks. There's a lot of folks that used the Adobe marketing cloud, um, for further cost of acquisition.
Like, Are you guys seeing any trends around higher advertising rates or spend rates than previous years, or is that not something you guys are looking at you?

Taylor:
[34:18] So we don't. We have looked at overall investment in advertising.
That could be a fairly complicated thing to grab to look into. But we have looked at performance and individual, Um, your ad level pricing and what's interesting is we definitely see if you're if you're advertising, especially in video, but also on display or search.
You're gonna see costs go up, um, a bit as everybody sort of pores online and wants to wants to acquire customers in the video room. That's about 23% higher CBN's.
But when we look at performance, metrics does go up by an even greater amount.
So, uh, you know, again in video that we're pressed about 20% performance in terms of, uh, viewable completions of videos are going up 30%.
Or we see, for instance, your email efficacy goes up quite a bit over that that same time frame.
So we should We haven't reached a point of diminishing return earns uh, in those areas yet where prices start outstripped performance growth, and I think there's a lot of opportunity for customer acquisition there on dhe.
Advertisers and marketers have figured that out and are pouring the money, and now when it's, uh, it's most productive.

Jason:
[35:32] That that makes sense, and that's gonna be a great place to leave it, because we have, ah, slightly exceeded are a lot of time for this show.
But as always, if we didn't get to something that folks want to talk about, your welcome and I hit us up on Twitter or leaves the question on our Facebook page, as always, have you enjoyed the show?
We'd really appreciate it if you, um, jump on Thio iTunes and give us that five star review were also nominated for this vendor of the year award in our category, So I'll put a link in the show notes.
If you could take a couple minutes and vote for us, we'd really appreciate that. But Taylor really appreciate you being on the show and sharing the data. I know it's a busy week for you.

Taylor:
[36:10] Thank you guys so much. Really appreciate the opportunity.

Scot:
[36:13] Thanks, Taylor.

Jason:
[36:13] Until next time. Happy commercing.

Dec 4, 2019

Support the Show:

The Jason & Scot Show as been nominated for "Best Retail Media Resource" by the VIP awards.  We'd appreciate your support, if you could take a minute to vote for us.

Adobe Recap

Taylor Schreiner is the Director of Adobe Digital Insights. He uses Adobe's data to give us a recap of the Cyber 5 (the five shopping days from Black Friday through Cyber Monday, this year Nov 29 - Dec 2).

Adobe Holiday Dashboard

  • Thanksgiving  11/28 - $4.2B (up 14.5% YoY) below forecast of $4.4B
  • Black Friday 11/29 - $7.4B (up 19.6% YoY) below forecast of $7.5B
  • Saturday - 11/30 - $3.6B (Up 18% YoY) at forecast
  • Sunday - 12/1 - $3.8B
  • Monday - 12/2 - $9.4B (up 19.7% YoY) at forecast

Don't forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.

Episode 202 of the Jason & Scot show was recorded on Wednesday December 4th, 2019.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott Show. This is Episode 202 being recorded on December 4th 2019. I'm your host, Jason Retail G. Goldberg. And as usual, I'm here with your co host, Scott Wingo.

Scot:
[0:39] Hey, Jason! And welcome back, Jason Scott. Show listeners we are in the thick of holiday 2019 and are really excited tohave back on the show.
Adobe. And I think this is the fourth time. In fact, check me on that. Jason had one of the interns check.

Jason:
[0:54] I I actually had one of the interns in you. That number. So yes, it's right.

Scot:
[0:58] Good. All right. Pre pre fact checked. We're getting pretty. Ah, reliable here of Jason Scott Show.
Um, this year, representing Adobe, we have Taylor Shiner. He is the director of Adobe Digital Insight's Welcome Taylor.

Taylor:
[1:12] Thanks for having me. Guys. Appreciate it.

Jason:
[1:14] We are excited to be a tailor and a sort of tradition on the show. We always like to give listeners a little bit of background. So can you kind of share with us some highlights of your background? And what your role is it it'll be.

Taylor:
[1:25] Sure. So I was the 52nd best chess player in Utah in fifth grade.
Ah, And then from there I went into a career in retail. Uh, I went,
to work on Internet insights about 15 years ago with some of the major Internet players across the industry, and I've been doing that for a decade and 1/2.
And then about three years ago, I found my dream job here. A WNKW Adobe Digital Insight's.
We get to tell these amazing stories about how the digital world works, and we get to tell people about how tech and companies and events are changing their digital lives and companies about how those same trends are affecting how they need to run their businesses.
And we get to talk about retail. We get about time travel. We could talk about a whole host of different things.
It's been fantastic, and I get to work with some amazing data scientists, analysts to develop these insights, and it lets me have conversations like this one with you guys. So it's a perfect gig, and I love it.

Jason:
[2:24] Possum. So, to recap, this is sort of a career highlight for you right now.

Taylor:
[2:28] Yeah, I like to I like to go from Holly Tyler, but this one, I'm loving it.

Jason:
[2:31] Yeah. Yeah. Pinnacle, I like it and I'm.

Scot:
[2:34] Think Jason means being on our podcast. He wants an explicit answer on them.

Jason:
[2:38] All right.

Taylor:
[2:38] Oh, yes, I'll give you a quotable thing. Being on the Jason Scott Show is a career highlight to date.

Scot:
[2:45] Boom.

Jason:
[2:45] That boom. Yeah. You'll see that in the in the preview show. Pretty soon here, Uh, and I'm sure all this insight stuff is gonna be super fascinating. But I have to know first, if you've kept up your chest up chess, it all.

Taylor:
[2:57] Uh, only recently in my eight year old has started to learn to play chess, and he's creeping up on being able to beat me. And that is not acceptable. So.

Jason:
[3:05] Yeah, that's a losing battle. You could probably keep ahead of him for a little while, but I think, uh, there's, ah, natural progression there. That's working against you.

Taylor:
[3:13] I'm afraid so.

Jason:
[3:15] Awesome. Well, let's jump into the data. So we talk about your date a lot on the show.
We already did. Ah, an episode this week. In fact, what we talked about some of your data, and it always falls on me to describe your data set.
And I'm sure I'd butcher it. So, um, here's a chance toe kind of refresh our audience from the horse's mouth. Can you tell us a little bit about, um, what the data set is and how you use it.

Taylor:
[3:38] Sure. So we build a model of US online retail sales based on trillions of Web site visits based on,
tens and back to think over hundreds of millions of skews based on data from thousands of different companies all across the US across.
Ah, you know, a variety of device types.
OS is on other information, and we use that to to plan out, especially on a day by day and occasionally hour by hour basis.
Uh, how we think that that season's gonna go So he predicted all.
And then we go back and we track on a daily in again, sometimes hourly basis.
How US online retail sales go s Oh, it's a big data lift, and we spend all year getting to this point to be able to talk Ah, in almost real time about how how the sales were going.

Jason:
[4:33] I got it. And so just make sure my understands. Correct. So, um, there are a ton of major e commerce sites that use an analytics product called the Dhobi Analytics, which is, if you go back far enough, formally. Ahm nature.
And so it. The core of your data set is in aggregated view of all of those customers that are using that analytics tool for for their e commerce sites. Do I have that right?

Taylor:
[5:00] Yes, sir. The majority of the data that we've got and this is not including some data from the recent magenta acquisition so that there's a whole other set of data sources as well as some other things.
We talk about it on the periphery, but the core of the data that we work with our data from opted in. So companies that have chosen to share data with us, um, and for value that we give them.
And so that shared data Anonima ized before we even touch it and aggregated at a very high level so we can talk about these macro trends, but yes, that's where the data comes from and to be analytics.

Jason:
[5:34] Perfect. And then, um Ah, and that was you already answered.
My fob question in the court date is that you have not integrated any of the new data that you might have access to from Magenta. And if I have it right, you're also, at this point not really using data from the rest of the adobe marketing cloud.

Taylor:
[5:53] E. I wouldn't necessarily say that. So we do. Uh, we do a lot of so we haven't agreed.
A lot of the magenta data allowed us to look at things like shipping and returns that, uh, we're new renews angles for us, and it certainly gives us these amazing to you into that tail.
Set aside some of the bigger players in terms of e commerce, but we also you used the mark enter data for your candidate to look at so are marking channel Information Ad Cloud, which used to be two mogul, which I worked for.
Uh, we used them for some advertising data around Thanksgiving. So we bring it all the pieces.
Um, but, you know, not all of it necessary goes to the top line number. As you as you say.

Jason:
[6:33] Sure. And then, um, you kind of alluded to this, but you're not just trying to report on trends from adobe customers.
You're you're using some advanced math and you do the customers represent a big chunk of the market. But then you and interpret what the total market is based on the subset that you see. Do I have that? Correct.

Taylor:
[6:56] You do. I could spend a whole other podcast on how we do that, but it sze not do that. Yes, it's cool math. We do cool math.

Jason:
[6:59] Yeah, let's not do that. But just call it a cool math.
Yeah, And then the other thing that comes up a lot. And I think you guys are really good in this as well.
Like very often. We talk last year versus this year, and when a lot of vendors report their data, the customers they have this year are different than the customers they have last year.
So when they're when they're talking year over year growth and things like that, it's usually not perfect. Apples to apples.
Um, but because your your, um trying to normalize the data for the whole market before you do it. When?
When you say there is a 20% growth this year versus last year, that's a pretty accurate number. Drab.

Taylor:
[7:39] Uh, yeah, I think you should. It's yet. You said that. Really? Well, that's absolutely That's.

Jason:
[7:43] Perfect. You can use that in your highlights. Now we've reciprocated. Awesome.

Scot:
[7:49] Go. So, uh, now that Jason's extracted his pound of flesh, let's Ah, let's jump in at a high level. How? How would you view Holiday 2019 shaping up?

Taylor:
[7:52] Okay.

[7:59] I think it's been quite strong. And it has been strong all through today.
In fact, if you let me, I'll give you, uh, it as, ah, this morning.
So yesterday's numbers Through the third of December, we saw $84.7 billion in online retail sales, and that's up 14.8% on last year for the same period.
So that's a little faster than our aggregate prediction.
But the way that the bottle is trending that out puts us on target to be about 14.1% roughly on our predicted Taff for the season. So and the 14.1%.
I mean, some listeners and people who visit our website will see that last year was particularly strong of the 16% growth year.
But if you look back a few years just 2016 twice 17 this is sort of on par with those growth rates, but on a much larger base now, as we head into almost $150 billion in sales. So it's it's pretty huge.
Um, the the other tidbit of information I can give listeners about yesterday.
Giving Tuesday is that it was a $3.3 billion day, which is amazing research and account $3 billion days, the way that when I started in this gig, we counted $1 billion days.
So they're coming fast and furious. Now, that's only up about 11% on last year.

[9:23] So, uh, it leaves us open to the question of our consumers.
Have consumers, you know, taking all these early deals on and won't be spent later, or are they just taking a break on Tuesday and ready to get back out today?

Scot:
[9:38] Yeah, let's Ah, so it sounds like we're growing kind of 14% year over year.
Um, if you if you kind of look at the shape of the holiday so far, I know you can't predict. Well, you don't know what it's gonna happen here towards the end. It's kind of gotten this what I would call a U shape where it's being more front and loaded and back and loaded.
So the front end is people that have their act together and jump on the deals.
The back end is like Jason I where we're like, Holy cow. Uh, holiday is here. We should do some shopping on the 23rd.
Um, the, uh does that does that kind of what you've seen and is getting more pronounced. Can you tell if you've seen the front part of the curve?
I saw some data that said, like, Veterans Day was unusually large and like the early November days were larger. You guess? You know.

Taylor:
[10:24] Absolutely so we saw just points on these numbers from this conversation.
If you look from the beginning, what we call the beginning seasons of the person November roughly right to, um, Wednesday, that hole to the Wednesday before Thanksgiving, that whole period Groot. About 15%.
So that's what that was about a point 1/4 faster than we would have predicted.
So angry it. We saw a big lift we saw lift above.
We would have expected in that early season it that seems to be attributable to a bunch of, uh, earlier deals.
We had something similar happen last year, but it's even stronger now where discounts came earlier in electron ICS and computers and televisions.
We also saw that, you know, last year, Thanksgiving itself was a breakout day where you had, despite it can. Suddenly Thanksgiving was growing faster than any other day.
That spike seems to have moved back now to Wednesday, where the Wednesday before Thanksgiving was growing at about 22%.
And I think again, that's attributable to ah, lot of deals moving forward in time. So and to your point, that really changes the shape of the season.
You know, we used to basically tell a story of like, look, everything is sort of lifting around that Cyber Five said. The days of the 757 days is getting a disproportionate share.

[11:41] That's still true, but we're seeing sort of, ah, shift back to earlier sales this year, and that might have to do with the calendar.
But I think it is actually a broader trend of thinking about these pre holiday sales and reality promotions as being think that happened earlier, both for retailers and consumers.

Jason:
[12:02] Yeah, it's interesting to me. It's like, um, it feels like in the beginning of the season, you know, there's there's a lot of retailers under stress and have to have a good holiday. And there's this kind of winner take element mentality.
And so we both see Maura aggressive promotions and discounting at the beginning of the season. And I feel like we also see more digital marketing like more investment in ads and things like that, huh?
That really goosed the front half of that. You, um and then I have a hypothesis.
We'll see if it plays out. But, uh, you know, of course, Amazon has gone toe faster and faster shipping, right? And so that, you know, this would be the first big holiday with with sort of standard one day delivery in various forms.
Walmart, target and some extent, even best Buy have all been forced to sort of match that fast shipping.
So, you know, not that long ago we would have had this this very gentle ramp down of sales as we'd hit shipping cut offs and people would stop buying goods and then they'd just be doing oh, piss or gift cards.
Or things like that because they'd run out of time to get the gifts before the end of, you know, in time for holiday.
But now everyone can be a procrastinator like Scott and I, because so many of the vendors will ship so fast. So it feels like like all of those things conspire together to make the very beginning and the very in these these ah, anomalous bikes or that you shape.

Taylor:
[13:25] I think that's that's gonna be absolutely true. And this this year, in particular with this shift, two more by online pickup in store ah, or clicking collect behavior.
And to these accelerated shipping, it's gonna it's gonna make people think they can wait longer in the season where they can't really wait longer to your point.
You know, it's it's three weeks away before even those things are gonna be, uh, almost too close to Christmas to shop for Thio to purchase with.
And so you know, I think we'll see that ramp up at the end of people. Start to panic a little bit.
And that's also why, by the way, you see jewelry discounts be really strong on, like 20th.
Everybody who's panicked and realize they haven't gotten anything starts. Uh, just looking for something nice and blinking. Tow. Give us a gift.

Jason:
[14:09] Interesting. I was always assuming that people just misbehaved right before the holidays. And therefore it was a Yeah, I have no personal experience or data to support that.

Taylor:
[14:13] You may have a better high pop resistant I do on my own. I would draw my contention.

Jason:
[14:20] Just to be clear, honey, if you're listening, um uh, do you want to jump in to the cyber five, though?
Um, so we just got through those, Uh, can you kind of give us a recap for specifically? How have Thursday through Monday played out?

Taylor:
[14:37] Sure, So overall it's about $28 billion uh, online purchases over that same time frame, and that's 10 almost $11 billion of purchases through smartphones.
So overall it was quite strong. Almost 18% if you like those five days over last year, five days with peaks, you been on Black Friday and Cyber Monday, which always kind of blows my mind because I get the question every year.
Are these days too big to really grow outgrow the rest of the season?
And I convictable Maybe next year they will be.
And it's not not the case, people. Another not only are moving more online, but they're really focusing a lot of those purchases and increasing amounts on those big days.
S o. You know, several money, for instance, this year was $9.4 billion.
So we're almost gonna guarantee there is a $10 billion day, uh, barring anything serious happening next year on Cyber Monday, which is,
incredible, and over 1/3 of that, those purchases are really coming on phones.
Eso you're seeing people not only window shopping actually make purchases on those big days on their phones, especially that's what cyber Monday when people go sit in front of computers at work.
But you know, people under the table on Thanksgiving.
Uh, people on Black Friday we'll pretend to hang out with their family, but but by where? Two things. Anyway, Uh, that's really been a mobile story.

[16:06] And then the other story of the weekend, which I always, you know, you're talking about how, by a and pick up in store, uh is ah, you know, it is a capability that my drive people to wait a little longer for their purchases.
But nonetheless, we saw a big bump in bogus activity.
Even on that, that major weekend without 40% more purchases.
Then we had when we saw last year over the same timeframe, so outstripping overall gross and really pushing both share up.

Jason:
[16:38] Interesting. And so And if I think of it from a historical perspective, you know, 10 years ago a few people had reliable Internet and so, you know, cyber Monday or we'll call 20 years ago.
Several Monday became a big thing, like we'd all enjoy Thanksgiving. We'd go to work on Monday, steal our bosses Internet and go shopping.
And so that was like the one day spike.
And then, as as, uh, you know, we all became ubiquitously online.
The traditional big shopping day Black Friday also became a big online day.
And in fact, I feel like they're often are these forecasts that that Friday is eventually going to surpass Monday online, which seems like, hasn't happened yet. Read joy. I have that, right?

Taylor:
[17:23] But it hasn't quick hasn't gotten there yet. Uh oh, no. Didn't you thought?

Jason:
[17:25] Yep. And then I'll go ahead,
I was gonna say, And then increasingly, those other days in the weekend have grown to be extraordinarily meaningful.
So, you know, frankly, 10 years ago, we talk a lot about cyber Monday.
I actually don't care as much specifically about the results on Cyber Monday, because if it feels like the the aggregate results of the Cyber five is much more important and indicative of how holidays going than any one day in the,
in that block nowadays, is that a good way to look at it, or am I being shortsighted?

Taylor:
[17:59] No, I would agree with that. And I think what's always fascinating to me and is, uh, topic of a longer conversation. Is that to your point?
There's no need necessarily now for Cyber Monday. Everybody's not only got good Internet access at home, they've got good Internet Internet access in their hands.
But we have become so habituated to that day being a major sales day, and both on the consumer and the retailer side that it continues to grow on.
The psychology of this often drives a lot of the behavior even beyond the pricing or the deal's or anything that our model might pick up.
So to your point, you know, I think if you just looked at the data, you might think, Hey, look, this is all going to smooth out a little bit.
But people continue to think about those days as the big days to go shopping, Uh, online and offline.

Jason:
[18:47] Interesting. So you're saying people might be willing to go shopping even when it's slightly irrational? Interesting. No.
Thank God for that, by the way. Yeah, and along those lines, it feels like folks have been trying thio kind of make hay in some of those other days.

Taylor:
[18:54] It's a new fighting I came up with. Yeah.

Jason:
[19:04] Like for a while now, that that Saturday has been small business Saturday.

Taylor:
[19:09] You okay?

Jason:
[19:10] Andi, I think there's a couple of people trying to grab Sunday now, too, right? It is. I'm trying to, uh.

Taylor:
[19:15] Yeah. Super Sunday has a bunch of different cuts at it.
Exactly. And there are big days. Now we're talking about, uh, you know, there, there.
Three and 1/2. Almost $4 billion each.
This is It's massive any other day of the year and we would be having a conversation about a particular $3 billion day.
But they just come fast and furious between November and Christmas.

Scot:
[19:42] Do you do? You have? Ah, At the end of the season, everyone has a different word. Just be like free shipping day. And then I think it's called Green Dares. But you guys, what is what is last year like? Was there a bump? And is it? How does that compare to, like, Cyber Monday?

Taylor:
[19:51] And.

[19:58] So we said we would see ramps toward the end of last year, and I don't have the last little couple days to hand. But they were more closer to sort of Super Saturday and or even smaller than that in the $2 billion range.
Um, as you had in there. They're not the ones bigger ripped last year, but two earlier point.
I'm really curious to see if we don't see a big bump. Uh, come to the 20th 19.

Scot:
[20:24] Yeah. Hey, this is just kind of came to me. So it's if you don't have an answer. I understand. So last year we grew 16%. This year we're growing 14.
Where do you think that 2% Delta is coming from? Is it just kind of across the board, or is it a certain category underperforming? You have any Any thoughts on the.

Taylor:
[20:44] I have some thoughts, and I think it'll be really interesting conversation to have in a few weeks.
But the the, um, the couple things, first of all the models telling us 14 ish, Um, my gut says there might be more upside risk there than downside.
So somebody get my clothes.
What seems to be the case so far in the data is that there wasn't proportionately even bigger push into the early season.
Um, because of, uh, a CZ people moved into Thanksgiving on on that Wednesday, some of his deals move forward.
But honestly, if you just if you just look at the math, which is, uh, what we particularly good at,
the just pushing the season shorter between Thanksgiving and Christmas is about a $1,000,000,000 which is, you know, 50 bases, 50 of those basis points, uh, arm or sorry on its own.
So between a little bit of merging of error and that some of those basis points and ah, uh, and not the shock of all these earlier deals that got everybody accelerated between those three things you kind of get to, uh, the delta.

Scot:
[21:53] So the jury's still out. Kind of depends on how the models perform and how people react to those missing days.

Taylor:
[21:59] Yeah, exactly. If we get a big surge and everybody. Service comes off of the off several Monday and thinks, Gosh, I got a sprint toward, uh, toward River Last shipping days game. I'll be very different than everybody feel like.
Gosh, I blew my budget on all those early deals.

Scot:
[22:16] Yeah, cool. It wouldn't be a Jason and Scott show if we didn't talk a little bit about Amazon.
And I understand if you can't talk specifically about anyone, retailer or whatnot.
But any insights into how Amazons holidays going big, they put out their annual release that said something like Vague like We sold hundreds of millions of dollars.
You know, third parties did great. So so it always befuddles Wall Street when they kind of without these puzzle boxes for them to figure, figure out.

Taylor:
[22:45] Yeah. J. J. Abrams doing the press releases? No, I, uh you said you wouldn't be your podcast if you didn't ask about Amazon.
It wouldn't be a doubIe response. I didn't say we don't talk about particular retailers, but what I can say eyes we do track the biggest and the smallest against each other Really looking at.
Especially as you see two big trends that big.
A lot of discussion about big, big retailers pushing, couldn't collect, pushing one day shipping, having great deals.
Ah, and a lot of democratization of, uh, e commerce. As you know, a lot of art form.
We have five farm, those others that makes that much easier for people to bring businesses to the market.
So those two forces air going on, um, in the on the average, uh, you see big companies outperforming smaller ones in terms of growth.
So if you compare November an average day in November to an average day in October for the big companies they're up about, these are $1,000,000,000 plus companies.

[23:42] They're up about 87% in sales, whereas the smaller companies in the 50 million lower range.
So these are the small ones are up only about 43% and some of it is.
It's coming from the East from the data, at least, is coming from two things. One is the larger companies are much better at mobile conversions, that 80% better at taking a customer and bringing them to purchase on a phone than the smaller companies.
And consequently, they get about 10% more of their share.
Their revenue from those phones and the way that I reviewed the data is that if you're a consumer and you are going to a big retailer, that big retailer has a number of advantages, including a wide set of products wide set of,
promotions generally really good, aye, aye at connecting you with those promotions,
and a really the slick, speedy checkout process that they worked on really hard.
And for the smaller companies, they obviously have quite a selection.
Some of them haven't figured out how to turn customers, uh, into buyers swiftly.
But the last thing I would say this is the most important part about this is I am talking about the averages.
So, you know, in the smaller companies, there's a lot of entry, a lot of people trying things out on a lot of exit, and there are within that average a huge number of small companies who are just blowing the doors off.
It's just that on average, they're not doing as well as the very big ones.

Jason:
[25:09] Sure that makes sense. Um, you talked a little bit about Omni Channel. I wanted to jump into that for just a second.
That seems like an area where, in particular, a lot of the big companies have made major visible investments in their infrastructure.
So of course you know, Target, but shipped. And then now that's heavily integrated. And they have rich like same day delivery and curbside pickup options available across all their mobile platforms.
Wal Mart, you know, has has done a bunch for general merchandise Omni Channel. But even more for grocery, um, and curbside pick up and and all of those things even, um ah, the Amazon.
You know, although much more footprints are starting to get a little better at Omni Channel with their with their small footprint of retail stores, um is any indication of that's paying off?
Like Are you guys ableto to see an Omni Channel transaction versus a pure digital transaction? And is there any like is the rate of growth of those Omni Channel transactions faster than overall?

Taylor:
[26:15] Oh, yeah. So we're we're seeing a Z, said rumor, roughly in the 14 to 16% range growth for the overall market place, but for by online picker in starker POTUS.
Another word that's up but, like 40% for the season. So it's way outstripping overall sales.
And what's also really interesting is we see that this has a little bit to do with larger, so small.
But we see that companies that offer, uh oh, this, uh, 20% better at converting, then companies that don't offer both us.
So people are coming there specifically for that capability, or at least finding that capability incredibly valuable to them.
At my my thought on this is Look, we got a phone in her hand that has moved the display window experience into your hand. It's moved the checkout experience into your hands, and everybody just wants to move that fulfillment.
That one thing in between the human experience, closer and closer and you know, one day shipping is great, but, uh, sometimes it's just easier if you drive down in about 10 minutes and go pick up the thing you just saw and knew you wanted.

[27:25] And plus these guys are. You know what we see in the survey data to is it?
This is good for the brick and mortar stores that not only are they know is you guys know that not only are they making people making purchases online and sitting in the car and getting that that pickup, they're also going to the store and buying another thing, could they thought of it.
I'm driving that That makes it different. Step for brick and mortar stores as well.

Scot:
[27:47] Wrinkle. Um, you've hit on this a little bit, but let's talk about mobile. So, um, do you guys, when I talk about mobile, I tend to take tablet out, and it seems like you do to you. You seem to be explicitly calling out smartphone.
Um, so you mentioned. I think I can't remember. Was it black Friday? You said it was. 1/3 of the sales came from a bull. Ah, talk us through any other kind of insights on the mobile side.

Taylor:
[28:12] Sure s o your point. We tried. We tried crier years to be really disciplined about mobile version smartphone.
We've been a little acts this year because tablets are decreasing share. So smartphone really had started crossed That that 1/3 threshold on major days in terms of dollars spent, it was always has been for the past several years.
The majority visits were coming from phone, so people were doing initiating their shopping.
We had this challenge empire years and still have some do now that they weren't closing the deal.
Uh, from that we'll visit either not at all or going to the desktop to purchase.
That gap continues to close. In fact, on Christmas this year, we expect to have the first day in us where the majority of online purchases actually come through a phone.
As people aren't going to their computers and their families are around, they're actually using boats.
That purchase and the things that are driving this, at least in the data that we see are two really interesting and related points.
One is that time per visit is going down rapidly.
So, consumer, they're coming. They're not messing around.

[29:20] They're looking for and expecting the product that they that they came for at least a product to buy.
And some of that is going to be in part because your connection speed have gotten faster. Screens gotten bigger processes were faster, but also retailers have gotten much better at streamlining that process.
I'm the mobile phone, and consequently, the amount of money that people are spending per minute per second on a mobile phone continues to skyrocket month after month, year after year.
As people just get faster making those purchases, especially with a lot of them. You check out options that make make it easier than, say, trying to type in the numbers on your credit card.

Jason:
[30:03] Fascinating. The, um that would be cool if, uh, Christmas did end up being the first, like, majority mobile day.
Um, I was also truce. You mentioned something earlier.
Um, that sounds like that. I call it a mobile gap when traffic side, but conversions lower.
And it sounds like that mobile gap is getting lower for big companies. And you said it a couple reasons why that might be, um, in general. Do you feel like that?
Like, Is that mobile gap? Um, getting narrower across the border. Is it only for large companies that they're they're being successful closing that gap?

Taylor:
[30:39] Well, I think large companies again, it has to do it so that the broad, um uh, you know, there's a much broader array of outcomes and smaller companies than larger ones, so it's harder to paint them with the same brush.
The large companies obviously have focused on this. Figure it out.
They can track per second per user per region per item, how much time consumers are willing to tolerate and they can achieve those things down.
If nothing else, would I just bring more machines online?
Smaller businesses don't always have that ability, but the platforms,
one of which Toby has but the Platform three Commerce are making that whole process from visit to fulfillment and even marking channel much, much more streamlined, especially for small businesses.
Who, uh, we think about that a little bit and focus on what their consumers experience needs to be.

Jason:
[31:34] Got it. So one A transition briefly to profitability. So last year I feel like the narrative would have been, ah, you know, a big growth year, a jump from the previous year.
But a lot of people felt like it was Ah, that was partly attributed thio heavier than usual promotions, which meant it actually ended up being, you know, not a phenomenal profitability year.
Um, and so this year, we're seeing the rate of growth slow a little bit from last year.
Is there any reason to believe that people are being more conservative on promotions or are you have any insights about how we're gonna come out from promotions and profitability perspective?

Taylor:
[32:18] So, you know, I'll be honest with you were really good about figure out the revenue. We're really good about throwing out prices. We are generally missing that third piece of costs that allows you to talk about profitability.
But I'll tell you what. I was thinking about this this morning and last night and looking at, but began for a bunch of different angles in our data and frankly, that the short answer is the results are mixed.
So we did. If you asked me a week or so ago, uh or even to I would have said, Look, the discount seem to be moving forward, especially in electronics.
Um, and so, you know, maybe the maybe the profit margins are slimming, but then we started. Look at toys and toys. Bottom out, quickly.
Um, uh, you know, maybe once the Toys R Us process was was through the toy discounts didn't go is deep.
This year's they did last year, and we're seeing something we saw. For instance, we elected appliances, appliances discounts for a little later last year.
So exactly how the profit margins are gonna go. Hard to say.
But the, um, you're in the revenue looks really strong.
So, you know, I think the jury is ah, bit out where possibilities go in.
But I don't for consumers see, a year where we're like have massively deeper discounts than the last year. We just have them earlier and on particular product.

Jason:
[33:38] Got that? Uh, that makes sense, and I agree. It's It's really hard to get a clear picture until well after the fact on the promotions, because there's like there's promotions and pricing effects and all these other things.
But one thing that seems like it might be coming to play a little bit more on profitability this year is profitability like there's a couple Evers one.
Is that pricing a promotion? Another is the cost of acquisition.
Um, and I do feel like folks. There's a lot of folks that used the Adobe marketing cloud, um, for further cost of acquisition.
Like, Are you guys seeing any trends around higher advertising rates or spend rates than previous years, or is that not something you guys are looking at you?

Taylor:
[34:18] So we don't. We have looked at overall investment in advertising.
That could be a fairly complicated thing to grab to look into. But we have looked at performance and individual, Um, your ad level pricing and what's interesting is we definitely see if you're if you're advertising, especially in video, but also on display or search.
You're gonna see costs go up, um, a bit as everybody sort of pores online and wants to wants to acquire customers in the video room. That's about 23% higher CBN's.
But when we look at performance, metrics does go up by an even greater amount.
So, uh, you know, again in video that we're pressed about 20% performance in terms of, uh, viewable completions of videos are going up 30%.
Or we see, for instance, your email efficacy goes up quite a bit over that that same time frame.
So we should We haven't reached a point of diminishing return earns uh, in those areas yet where prices start outstripped performance growth, and I think there's a lot of opportunity for customer acquisition there on dhe.
Advertisers and marketers have figured that out and are pouring the money, and now when it's, uh, it's most productive.

Jason:
[35:32] That that makes sense, and that's gonna be a great place to leave it, because we have, ah, slightly exceeded are a lot of time for this show.
But as always, if we didn't get to something that folks want to talk about, your welcome and I hit us up on Twitter or leaves the question on our Facebook page, as always, have you enjoyed the show?
We'd really appreciate it if you, um, jump on Thio iTunes and give us that five star review were also nominated for this vendor of the year award in our category, So I'll put a link in the show notes.
If you could take a couple minutes and vote for us, we'd really appreciate that. But Taylor really appreciate you being on the show and sharing the data. I know it's a busy week for you.

Taylor:
[36:10] Thank you guys so much. Really appreciate the opportunity.

Scot:
[36:13] Thanks, Taylor.

Jason:
[36:13] Until next time. Happy commercing.

Dec 3, 2019

EP201 - Cyber5 2019 Hot Take

Cyber 5 is the five shopping days from Black Friday through Cyber Monday (this year Nov 29 - Dec 2).  

Adobe Recap

Adobe Holiday Dashboard
(note: numbers updated after show was recorded)

  • Thanksgiving  11/28 - $4.2B (up 14.5% YoY) below forecast of $4.4B
  • Black Friday 11/29 - $7.4B (up 19.6% YoY) below forecast of $7.5B
  • Saturday - 11/30 - $3.6B (Up 18% YoY) at forecast
  • Sunday - 12/1 - Not reported
  • Monday - 12/2 - $9.4B (up 19.7% YoY) at forecast

We'll have an Adobe analyst on next week to break down results.

Don't forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.

Episode 201 of the Jason & Scot show was recorded on Monday December 2nd, 2019.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott show
this is episode 201 being recorded on Cyber Monday December 2nd 2019 I'm your host Jason retailgeek Goldberg and as usual I'm here with your Scot Wingo.

Scot:
[0:41] Jason and welcome back Jason Scott show listeners hope everyone is having a successful sales and up time Cyber Monday Jason how's your cyber monday going.

Jason:
[0:52] Mine is awesome I've been up all all day I haven't had any outages.

Scot:
[0:56] Very good nice to know I have you what's been hot on your must-buy list.

Jason:
[1:01] You know I'm falling the consumer Trends so I'm buying a lot of Frozen and PAW Patrol toys.

Scot:
[1:10] Very nice.

Jason:
[1:11] Yeah those are big sellers this year and my son is in one both.

Scot:
[1:16] Rachel have you seen Frozen to you.

Jason:
[1:19] We did we took baby geek to his very first movie was frozen to eat totally mean you did great and enjoyed it.

Scot:
[1:26] Awesome we did adults attitude is good.

Jason:
[1:31] There's a few good movies out right now and of course December going to be a big month for you and me.

Scot:
[1:38] It is so this is our Star Wars side Sidekicks the first.
Star Wars fan I strongly recommend a really good Star Wars content and then yeah December 20th.
We'll see it's kind of a Bittersweet classic but have to report on spoiler-free report on the shows that we do after that.

Jason:
[2:04] I will mark my calendar to listen to that one.

Scot:
[2:07] Well folks we are in the meat holiday 19 as mentioned coming to you live on Cyber Monday and wanted to give you a cyber five holiday 2019.
As we mentioned on the show there 60 or days between Thanksgiving and Christmas this year so in a way everyone these days is really Amplified and much more important than usual
so first want to set the table we did a new show that I'm sure you all listen to but just to refresh your memory
when you kind of boiled all the different forecast online offline what not.
The one I cared most about showed e-commerce coming out in the mid-teens for Holiday 19th that was kind of the pontification around the Halloween time frame for 4 we're going to see the shirt,
we have been busy here at Jason Scott podcast headquarters Gathering all the data and are going to summarize it in this hot take,
Jason you've been studying the Adobe data and we are going to have Adobe on the show later to go into this more detail but they walk us through what they reported so far.

Jason:
[3:13] Yep. So I would say it's but good news bad news from the Adobe data all the days are up pretty significantly but they're all
down slightly from adobe's forecast so there it is supreme their forecast was slightly over Rosie and the the rate of growth is probably swelling so for Thanksgiving but that man was sales were up 22% which came in at 4.2 billion up sales in the US
against the forecast at 4.4 billion so off the forecast a little bit but up a healthy number of Pap you know more than the
traditional amount of e-commerce growth and of course Thanksgiving has been a particularly rapidly growing.
Day in the old days people didn't shop on Thanksgiving Salina shop online on Thanksgiving and increasingly as shopping is gone the mobile
you know where we're all shopping on the dinner table and Thanksgiving so that that day is growing faster is now pretty big black Friday.

[4:18] You know it continues to be the biggest day for offline shopping online growth according to Dobie was only 14.5% so.
You know not not.
Super impressive growth I mean, in line with the the typical average growth we see for the whole year and again slightly under adobe's forecast of 7.4 billion and sales on Black Friday against a 7.5 billion forecast.
The year we are seeing a significant shift to mobile.
And that the rate of mobile growth is much bigger so I cracked Black Friday 4.
Adobe I mean there's going to be some other data that can put you this a little bit later but Prado be on Black Friday 39% of all sales 61% of all traffic.
I was on mobile and I would say those numbers are in line with the individual data I've seen from clients the majority of traffic is on mobile but.
But still mobile underperforms as a conversion in the aov form factor.
And then Saturday was up 19.6% Sunday was up 18% and we don't have the final numbers from Monday because it's still going on in a lot of us every Monday shopping happens.

[5:41] At night as we're recording this but they're you know what the forecast is for 9.4 billion and it sounds like people you know still think it's going to be in that.
9.2 to 9.4 billion which is a pretty healthy bump over last year which was actually 7.8 billion so where.
We are simply not going until we're jumping over a billion dollars in sales just on on Cyber Monday so for Adobe that's going to put you just under Thirty billion dollars for the cyber5 29 billion for the.
For the whole deal.
And that was pretty much how Adobe saw anything you saw in the Adobe data Scott.

Scot:
[6:26] Yeah. I saw a lot of wall streeters kind of summarize the data and I saw some people kind of.
I would call a sounding alarm Bells but they're starting to say there's some concern that it was a little squishy I would say so especially this slowing so last year.

[6:44] Thanksgiving and Black Friday rough by 29% year-over-year and to kind of go to almost half of that at 14 and a half people felt like
you got it feels like we're really slow down your ear specialist pure days now the Counterpoint to that is baby people did start shopping earlier and Sibley was the first things that I want to talk to the folks about cuz I think they also reported Veterans Day was up something like 40% so
and that goes what is that that's double singles Day this year right Stars 11:11 so you know
so one scenario is it song these days are so important that you know that the problem is that the shape of the holiday just refused to change it
go forward more and more I have anecdotally see more people talking about I should cut my holiday shopping done it's only the 2nd of December lot of that going on.
These guys have started rolling out their head like a November month of black Friday's or something like that it's everyone's definitely
going earlier so I got to get this kind of changing the shape of the holiday but we'll have to see what the data bears.

[8:00] The,
the taking it to the brick-and-mortar world there's a couple folks that track traffic Jason I know you feel strongly about this exceeded these things maybe not being,
the best fits it is kind of
probably directional I would say and so shoppertrak is one of those and they said by their calculations store foot traffic was down 3%.
Over the whole holiday. So far that's kind of the Thanksgiving through Cyber Monday but on Thanksgiving it was up 2.3% so this kind of Mia Black Friday movie did Thanksgiving Trend continues
I did notice that this was the first time Best Buy has been open for.

[8:44] Thanksgiving so they kind of jumped into The Fray but then Black Friday ring shoppertrak the foot traffic was down 6.3%,
that sounds most cataclysmic to me as a.
Oh my guy because I count on that foot traffic for Black Friday so it's kind of,
the piece that together with Adobe data it starts to feel like maybe the physical stores are not really going to come out of this very well lefse
one more data point is from retail next and they had Black Friday Also down there wasn't theirs wasn't as severe
they said the traffic was down 2.1% people bought a little bit more of the sales were only down 1.6%
banana same time they said the transaction value was down 6.7% that didn't make any sense I had to read it like six times I don't know how the
Ultra Works in that particular statement but I'll let our listeners try to pursue that if they can they can make more sense than I could.

Jason:
[9:42] Yeah I think what it amounts to is sales as in sales conversion you bought or didn't buy and Transit.

Scot:
[9:49] Okay so it's like unit unit sales.

Jason:
[9:50] The dollar value yeah yes I think it is conversion in aov.
Yeah I think those are both totally valid data sources those are both companies that sell Hardware that measure traffic in stores and so that the only grain of salt to take with their data is it skewed towards the particular,
set of retailers that each of them has sold two and you know they disproportionately he happened to both sell two big boxes and Mall retailers right and so,
you know it's,
that that's a a significant portion of of the retail space but obviously you know we know we know malls are down in general and
you know as I think it was traded in both their datasets more stores are open on Thanksgiving so there was more overall traffic on Thanksgiving and that took a bite out of Black Friday but I do agree with you.
Like the bigger Trend that's more concerning as overall for the for the turkey 5,
days you know trap traffic's down in that that is a big concern for ticket when there's a bunch of retailers that are already in a distress situation.

Scot:
[11:01] Yeah nfm United State assets bisacky
the neuro datapoint can really screw things like an online a lot of them don't have Amazon data and that's like half right so that's going to be don't have that day to 30% that's going to cost you everything
south of where I came in so I'm left thinking you know between these these guys
when I go to the mall the store that's the busiest Apple Store I doubt apples using these things maybe they are I don't know
he didn't have Apple Store that seems to be like the number one destination in every Mall I've been in the last 2 years so I'll meet you at you'll get this really die of you the world that may not be true.

Jason:
[11:45] Yep yeah in retail that you know that the mall winds tend to be more specialty apparel and anchor store in so you know we know those are.
Two unhealthy parts of the the return echo system.

[11:58] But I did also see that the sales force has a bunch of their data out.
In that that also was interesting.

[12:11] The date their numbers did not completely jive with the Adobe numbers you want again same same conversation we just had.
Salesforce data comes from all the people using Salesforce Commerce Cloud which was formerly demandware demandware was originally really targeted and apparel retailers so it's it's Broad and since then but you know I think if we look at the bulk of their.
Their user base it's going to be I'll call him upper mid-tier retailers so it's not going to be the very biggest retailers cuz it's a.
Clouds a solution with a rev-share component.
I'm sold your shoes you probably wouldn't use them but they tend to be kind of enterprise-class customers and they tend to skewed towards retail and so that
apparel so you know that's going to buy stared at a little bit but they had Black Friday up 13% which again is another bad number and kind of matches the.
The Adobe one in general they had that was 7.2 billion I think which is up 14%,
a interesting thing that they only gave us by Friday data but they also had some interesting discounting data and they said that they saw their customers.

[13:30] On average of sales were discounted 28% this year versus 27% last year last year we talked about it being a pretty heavy promotional year and it actually,
had a pretty significant negative impact on margins and you don't gets feeling like that.
True again this year what jumped out at me though is they also said that 56% of all the sales on Black Friday were happened on mobile phones which is.
Considerably higher percentage than what a w said and.
You know I'd be surprised if overall for all of retail that the numbers really that high but but interesting to see that that's that's what's happening in their segment.
What did you think about that Scott.

Scot:
[14:18] Yeah it feels like mobile the mobile results are kind of all over the place so so,
that point was from the shop Friday then we can have a discussion about it
Absol Shopify is done something fun to have a visualization like this and then it didn't seem to be that cool.
What's the horoscope I don't have a handy or I will put it in the show notes but you know it's just a spinning globe you can see line shooting all over and then occasionally it'll say
a customer just bought an order you know that's going to go 50 miles or something like that and then it says.
Check out or something like that just feels like.
Just not enough information to really be useful but then so that that was kind of a little bit of a disappointment but they did announce that for Holiday they're seeing sales up 40% year-over-year,
cross 6.1 million Shoppers and then they said Black Friday was up 49% year-over-year.
Whether they said 69% of their sales were mobile that felt like super high because for the longest time you know traffic has been north of 50 for a while but sales ad in south of 50 on mobile but we're saying mobile.

[15:44] Tablet covers around the desktop category or even separate or is it really just one product detail page
we've ever been on Facebook and seen an ad where you can kind of see an ugly sweater that's interesting to you or a cat.
Bug or something like that.
A lot of those are just Shopify one product page stores I could lyrics you mind into a check out so I could see that mobile number being there saying that I thought was true about their data,
having a. Of 10 years reproduce this kind of data at child eyes or nose bleed kind of stop doing that but you have to be careful because you can give this.

[16:33] You have this discussion of not clean view of the data because they don't report same-store sales that's really important because he's growing.
Merchants so they say they're hot is up 40% over this really closely and I think I'm saying their entire holiday is up 40% with that doesn't really tell you is what are the Saints for sale
so they added 50% more Merchants then actually there's things for sale would have to be down because they're adding always merchants and yet
your bratty more Merchants than their stomachs true that it's kind of not very helpful to have that number without the seeds for sale on it so hopefully this is our first year doing this will put them through some of this give us a little bit more data that this kind of
meteor.

Jason:
[17:20] Yeah I had the same impression and I equally I was excited when they announced this holiday Port the real-time holiday dashboard
and yeah it ended up just being an order for me a minute speedometer really which isn't isn't that interesting a bunch of these companies in the past have had these really interesting real-time dashboards but
for the most part Benders and moved away from those so
I'd say we have fewer datasets and for sure of the days since we have one that gets quoted the most is Adobe and that's probably with good reason not only do they have a a good chunk of e-commerce
but they also do the rigorous math to state same-store sales so the one downside of that is
you actually can't come when they talk about this year vs last year if you actually go to last year and see what their last year was it's not the same as what they're talking about.
Now because they're comparing their current customer sales this year vs last year not their customers last year at that.
Could be more confusing to make any more sense but they they do the math right to make sure it's true apples-to-apples.
Set of retailers with their data this year in their data last year.

Scot:
[18:35] How about did you see in any interesting out of this.

Jason:
[18:39] Yep so this is always the sad part to report but usually there are some stumbles over this holiday as you know these sites get hit with.
You know dramatically higher traffic than they're used to and that tends to.
Put some stress on things and we usually have one or two notable outages and unfortunately this year was no exception the one that I saw to get the most buzzed was Costco.
So they even really had them put a lot of focus on digital until very recently the kind of almost.
Begrudgingly did digital and you know they're their Executives used to talk about why would we ever encourage people not to come to the store and stuff like that so they they really only have done serious about digital last year so like you don't frankly
they're less digital immature or then some other retailers and not shocking that an outage I haven't seen any.
Any sort of recap as to why they had the outage sometimes we get it sometimes we don't Nordstrom Rack also has an outage which,
tell me a little more surprising cuz this has been a big day for Nordstrom for a long time
and I did see something funny that I just had to add add to the list brick-and-mortar retailers are not immune to outages either so one of the very biggest shopping malls on the west coast is South Coast Plaza in Orange County and they actually had a power outage at 2 p.m. and all the stores have to close for several hours
cuz they they couldn't use their point of sale systems.

Scot:
[20:05] Does that do to those rolling around house to have enough there cuz it's kind of random.

Jason:
[20:10] Yeah I don't I kind of doubt it so if they are having rolling power outages but if they did that to her to like this huge shopping mall on Cyber on Black Friday that would probably be.
Some,
Sirius Revolt so I suspect this was an unplanned thing and it sounds like it was just localized to South Coast Plaza so so probably some some issue with their infrastructure I was actually
at the on Thanksgiving day I was at the Lions Bears football game in Detroit and we had a power outage during the halftime show so the the music got interrupted.
Yes it happens Super Bowl went black one year.
Yeah so what is that investors think of all this.

Scot:
[20:57] Yes it was a Wall Street is largely kind of going through a lot of the day that we have one of the more interesting reports is out of Goldman Sachs or they have a retail analyst
and what they do is they come up with the basket of holiday items and they do it in two categories take the track consumer electronics and toys
and then they did really come up with this round Halloween the track it through Tyler holiday and it was interesting there is on the electronic side
they also look at selection and
Amazon is kind of dominated there where they have the most of this basket of goods that are in stock I'm so a lot of people sell out very quickly and see see this with the.
Targets in the Walmart especially and I think that maybe cuz he's in that store kind of inventory as a backstop more than the hook on it.

[21:44] But you know what else I noticed is Amazon's prices crept up and
the Amazon was the cheapest at
so the index is at 1 so it's so if you add up this basket of goods that's one on average below the average about that
you're working so Amazon was a full 1% lower than everyone else in Best Buy was the most expensive then the week that kind of ended with Cyber Monday Amazon was up 1.6% so.

[22:24] Walmart with the most expensive at 2% off the decks at Best Buy a discounted about 3% that's kind of simple average but then when you wait it by
the more expensive items having more weight in the whole thing kind of price-weighted approached Amazon was the most expensive are around Cyber Monday at 3.1%
that's on consumer electronics and then if you go and look at toys then,
your Amazon was by far the most toys by a factor of about 3%
so you're kind of the read that I got from this pricing data was that the Amazon was really,
Cushing to win the Toy War this year in a consumer electronics maybe they're right kind of margin preservation that was my take on some of that interesting
ice basket of goods kind of price now it's.

Jason:
[23:21] Yep and that is going to be interesting because it is that's the price that all the stuff gets sold at is in many ways more important than the,
total revenue number in the in the final analysis and how successful holiday was so that's going to be an important thing to track it is tricky because there's so many.
Different different ways to sort of track pricing data and it's just not possible to to perfectly know what every retailers doing on price.

Scot:
[23:50] That's better so you know just kind of land the plane in c e that's a 5% Delta Amazon margin was effectively 5% higher the Best Buy's which is really material into termite.

Jason:
[24:03] Another interesting data set is this company called
Edison Edison Trends is the name of the company and they are another one of these companies that get a large panel of consumers to give them access to their emails and then they scan for
e-receipts and they report you know various e-commerce Trends based on the e-receipts that they see in so they
actually publishing data specifically for Thursday and Friday that showed up from there their View,
have individual retailers did and so they had like the big Winners that grew a lot as Nordstrom Walmart and Amazon they showed Nordstrom is the.
Fastest griller with 60% higher sales and last year Walmart at 53% irr in Amazon at 49% higher and they show Target JCPenney and eBay is the big losers with
Target down 12% JCPenney down 14% in eBay down 17%.

[25:17] So that it that's an interesting data set I hate to say it but like you need to take all these receipt data sets with a slight grain of salt number one the big,
retailers are constantly trying to obfuscate the receipt so that these companies can't scan their sales so it's a constant arms race and
you know I do Tennessee some like crazy anomalies in this data and Yuna frankly
it just can't be true that Walmart and Amazon are both up over 50% and the.
Average for the day is only up up 17% like that would have sent you mean every other retailer on the planet is way down because Amazon and Walmart are such a big.

[26:02] Chunk of all all e-commerce sales
but directionally if those are the retailers that are winning and there's a retailers that are losing that is believable
and particularly of you if you look at it through the lens of discounting you know you think about a retailer like Nordstrom traditionally they didn't like to Discount a lot and they had one big sale a year
then maybe you know did a little activity around Cyber Monday but it wasn't a huge promotional holiday
and this year Nordstrom is super promotional that a lot of deals on merchandise and then there
they're literally giving you money to shop so you can spend $400 on discounted merchandise on Nordstrom and I'll give you $100 back so.
So they're really aggressively trying to buy customers per your day that we saw that Walmart and Amazon a really aggressive on price.
And like it so I haven't seen a conclusive data but to me it's at least viable,
the target is intentionally being less promotional than some of those other retailers this year in particular you think.

[27:02] A pretty big chunk of Target sales are exclusive merchandise.
There there's less reason to be promotional on that so you might see you know Target for going a little bit of.
Top line revenue by not being so promotional but maybe they'll end up being a little more profitable than some of these other retailer.
So you don't I'm going to tell him that but but as I sit here on Cyber Monday I'd say rate of growth slowing.
Aggressive discounting continuing there's going to be a lot of stress on profitability and.
And that you know the big strong retailers are disproportionately winning which means the distress retailers.
You know are going to be really distressed coming out of this holiday. Which is you know none for an unfortunate reality.

Scot:
[27:51] Seems like the other big trend is mobile heading to 60% of sales not to strap.

Jason:
[27:56] Yeah yeah and I do I mean I think the mobile Gap we talked about a lot it's still a real thing but I do I do believe it's narrowing and it Narrows more on these big event holidays than a minute it's likely to for the.
Traditional shopping throughout the year as well so not shocking to see mobile index higher on these big sale days then then it would ordinarily.
So that is pretty much are.
Quick take recap as we're still waiting for final data to come in on Cyber Monday but we hope you enjoy this sort of real-time look,
I am you do have any questions or comments we would certainly enjoy hearing about them on our Twitter feed or on our Facebook page
and of course if this hot takes been valuable to you we sure would appreciate it if you'd go to iTunes and give us that five star review.

Scot:
[28:49] Big Sur when we hope your holiday sales are up over 100%.

Jason:
[28:54] And until next time happy commercing.

Nov 26, 2019

EP200 - Walmart Chief Customer Officer Janey Whiteside 

Episode 200 is our 4 year anniversary, featuring an interview with Janey Whiteside, EVP and Chief Customer Officer at Walmart.

Anniversary Recap

Janey Whiteside Interview 
(Timecode 6:34)

In this wide-ranging interview, we cover many topics, including:

  • Janey's background at Amex
  • The role of Chief Customer Officer at Walmart
  • Doing things at Walmart Scale
  • What does digital mean at Walmart
  • Private Label
  • Amazon
  • Challenges and opportunities of value focus
  • Innovation
  • The future of retail

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Episode 200 of the Jason & Scot show was recorded on Wednesday October 9th, 2019.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott show this is episode 200 being recorded on Wednesday October 9th 2019 I'm your host Jason retailgeek Goldberg and as usual I'm here with your co-host Scott Wingo.

Scot:
[0:38] Jason and welcome back Jason Scott show listeners.
You guys can't see us right now but Jason and I are wearing our Tuxedos and that's because we are celebrating our 200th episode and 4 years of podcasting together.
Jason I don't think we've told her origin story so this is probably a good time is any he has been for years so here's my recollection was here.
This lines up with your memory.

Jason:
[1:03] Yeah and then I'll correct it.

Scot:
[1:05] It would be a Jason Scott show without a lot of Jason cracking Scott so my memory is we were having some adult beverages after a board meeting that was part of the shop. Org.
Oregon digital Summit held in Philadelphia and this back in 2015 and we were about an hour into a payments discussion and
I decided was just starting to do some podcast listening a little late to the party there but better late than never.
And then you know what you started talking I was like you know every time I'm hanging out with Jason I
I learned a lot about payments and Retail and all that offline stuff that I don't spend a lot of time thinking about
hopefully you learn a lot about e-commerce Marketplace for me and I said you know we should do a podcast where are you talk about your payments and offline stuff next.
Then we pretty quickly moved on to probably personalization or or one of your other favorite topics.
In a week later you called and said hey you know you talked about podcasting I have all the equipment and I'm ready to go and I figured this all out.
What's your first show for singles day and we were Off to the Races so I learned an important life lessons from all this and that is with great power comes great responsibility.

Jason:
[2:28] Scot I think that might have been Spider-Man's life lesson.

Scot:
[2:31] Oh yeah you're right sorry I get my my marble and podcasting mixed up the real life lesson was if you're going to pitch Jason on an idea you have to be 100% ready to run with it and be committed for at least 4 years.

Jason:
[2:45] Yeah yeah you pay a horrible price by pitching a if you're not ready I think the secondary lesson here is if you want to pitch Jason and I have it work pitching something that allows them to buy new electronic Gadget.

Scot:
[2:58] Absolutely.

Jason:
[3:00] Yeah so I think when we started this I did a little research into podcasting and it was like the majority of podcast fail in the first Eight Episodes so
my my goal when we started was where we're going to stick with this and and not bail during the first date episodes and I thought you know,
maybe the the 12 members of the shop. Overboard and our friends and family would with them and it's been wildly more successful than that.

Scot:
[3:25] We 50 x 28 250 external no 25 x.

Jason:
[3:34] Yeah it's amazing and I I was looking at some of our podcast stats last night and we have now crossed over 176 hours,
of content so if you are so inclined you could listen to us talk for seven straight days without taking a break 24 hours a day.

Scot:
[3:53] Awesome that's a few hardcore streamers out there.

Jason:
[3:57] Yeah and if anyone chooses to do that will let us know.
Chicks I'm getting out of this early shows I'm going to stand up and then a couple months and we started adding guest so our first guest was Peter table and that was episode 15,
I also chuckled
several episodes were like 30 minutes and we slowly have prep up to the 60-minute mark and I think our 200th anniversary shows likely to go even maybe a little longer than that.
I was looking at some of the the podcast ads on our most popular guest was Ken worzel who is in the president of digital at Nordstrom he now is still the president of digital but also the CEO of,
I most popular new show was the show we did about Amazon acquiring Whole Foods.
The Deep Dives have been especially popular and surprisingly are most popular Deep dive was on artificial intelligence which is not necessarily what I would have guessed.

[4:49] A man of the guess I sort of to Hall of Fame guess we have a Samir bhavani and who is then with 1010 data that has been really interesting data on.
I know how how people a babe on Amazon and Tamara Gaffney who was with Adobe and had all the data from Adobe analytics on on House customer shocktober holiday
open those guess where I'm free shows and I'm I have to throw in an honorable mention
or Melissa Burdick and the genie dually they both been on two shows and a show fun fact they actually recorded a third show together,
and it never aired because we had some problems with permissions from one of their employees.

Scot:
[5:32] Those are some awesome facts Jason it's been a great four years and in all seriousness we couldn't have done this and we would have done it without you listeners we really
shit you guys listening to our thoughts around retail and e-commerce each week and we got just amazing feedback questions
guess I would have never imagined we would get on a podcast we really appreciate it and realize we are busy like you are and have a million things you should be doing and you really humbled and honored that you take time to listen to our thoughts.

Jason:
[6:03] Yeah I want to Echo your sentiments exactly. I'm super grateful particular for those listeners that have stuck with it for a long time like it's now become one of my funnest things to do is go to some industry of van
and you know just random people in line waiting to register or get Starbucks or whatever will occasionally recognize my voice and it's triggered all kinds of fun.
Fun conversations
you know in a few rare occasions people even recognize my voice at airport so that's super fun and I'm really grateful for all the listeners that have made this a great show.

Scot:
[6:34] Well since this is our 200th episode and 4 year anniversary celebration we wanted to do something really really special I like to say it took us two hundred tries and I think we've actually going to deliver on something really exciting.

Jason:
[6:47] That's a lot of pressure.
That's right Scott I am here with Janey Whiteside Walmart's Executive Vice President and first Chief customer officer which working want to hear more about Jenny welcome to the show.

Janey:
[7:00] Thank you excited to be here.

Jason:
[7:01] We are thrilled to have you a tradition we might have on the show with gas is to get a little bit of their background prior to their current role so can you tell us a little bit about what you did before Walmart.

Janey:
[7:12] Yes so I'm going to age myself hip but before Walmart I spent 20 years at American Express so I started it have a job before that so I was at HSBC
before that 73 companies that you're my twin tiers American Express I in,
when I first started I was I was in finance what if I start my career.
I'm in from banking to planning and finance and was starting to figure out that may be fine arts was wasn't my passion where I want you to go moved over to American Express and I was doing.
Pricing work and realized pretty quickly that there was a lot of people of the other side of the floor the mox's will something the other side of the floor and they seem type of way more fun,
I didn't know we were having I am brushing away and I spread sheets and so you know was given the chance the opportunity to
move over to the new product development team that was really had to spend the night in the next 20 years and a whole variety of various disciplines across marketing.

[8:23] Business Development sales roles in a I feel very passionately that it's really hard to sell on behalf of a company if you don't really understand that.
The customer the brand you know how products are being built and sold and so but a lot of time bringing Business Development sales teams together
did your client management roles and when I left I was actually running the global.
Premium products benefits and services if you think about green go apartment since you're in the cards that the AmEx cards and then,
all of the services that support them somewhat that CM Punk people familiar with the airport lounges.

Jason:
[9:12] Very cool and.
Obviously American Express his famously quantitative has a ton of data so when you talk about getting to know the customer it feels like you are in a unique position for really know your customers well.
Tell me if I have this right I want to say one of the cool promotions during your tenure at American Express was the beginning of small business Saturday.

Janey:
[9:37] Yeah so you know I'd like to say it was my idea it wasn't as many people so I did and.
I think what's most interesting honestly about small business sign today at the time of the continuation was.
It was an opportunity.
Afro-American expressed to really do something to celebrate to promote uplift small businesses around the country and it's 9 in in a time of turmoil probably the first time.
I've ever worked on in the strip that was so genuinely in favor of the customer that,
American it wasn't it wasn't a favorite American Express our entire ethos was go find a small business
go go go test it go see it go see what makes them different and I hope he spend some money and if you spend that on National Visa or Mastercard and we don't care I just want you to go and learn what is really different about small businesses and.
From a purpose perspective what was really interesting was everybody wants you to work on it
are you could handpick the talent across the company because everybody felt like you were serving at you know how a purpose and it was just a real passion and dedication of the teams that the continued the
that's where all the way all the way through when I left at least.

Jason:
[11:01] Yeah and that is very cool because obviously that the whole Purpose Driven campaigns.
Very in Vogue right now like Somers wildly successful some like you don't have dubious authenticity but it it's totally cool to see those those campaigns that were so successful before it was the trend is yours.
Until after doing your bit to help small businesses in America you you change rolls to the diametric opposite of small businesses.

Janey:
[11:33] Yes I was just as I was talking about small business Saturday I'm going to Parlay this is how do you go from that to.

Jason:
[11:39] Oh I can transition any.

Janey:
[11:40] Obviously yes so I am Walmart first ever Chief customer officer.
On paper although you knows you go back through one of things I like to do when I go into any role any job any brand has to go by.
To look for what I like to go back to the archives I like to take a look at where are we today and where we come from.
If you go back and you take a look at the some old made in America bulk or in any of the things that you can see online.
What's super interesting to me is he in his office he was incredibly small and a consummate retard.
Actually a marketing genius way before his time and he start when you start to think about and I will talk in a bit about things like.
Innate segmentation and design targeting and really talkative product positioning and how you do that way ahead of his time and so he really was right he was the first Chief customer officer,
because he was so highly thoughtful about.
A the mission and be the deployment of Batman and how you grow your business and obviously grew it from from it from a small business to the to the world's the world's largest company.

[12:55] I ate a what constitutes a chief customer officer today I like to say it's everything set up at the beginning of the funnel at the end of The Funnel and then and supporting underneath so.
Supa tactically it means.
Unique source of a voice of the customer so and insights days Trends all of the how do we have it how we actually have a single voice of the customer and how do we ensure that that is used,
objectively across the company we will know their fax this yo fake facts this is fake news top news,
we need to make sure that we have the capacity to have a source of data that is used consistently and objectively.

[13:32] How do I identify the right customer Journeys we want to self how do you prioritize those how do you deploy the resources cross-functionally have against those I have a sort of Innovations like new product development.
Group so you may have seen.
Accidentally about will be cool in home which is really actually deliver groceries into the fridge I'm so taking that service expanding that continuing to test and then see if wet weather we take that in there a whole series of other Renovations with with the balcony.
And something about that the sum right at the front of the phone all this as we think but early stage Innovation Chief product officer runs all about you not digital product and then how do you deploy that didn't know many fashion I have a team that runs.
I Services Knotts everything from
gold Financial Services we offer in the store to a credit card to any of the services in and around the store so I think about the build a better the FedEx of the nail salon on the Chick-fil-A that is in a in a in and around the store and drives and drives that as well as I Omni.
Services so if you think about something like cake decorating I you order the cake you order decorating online how do you integrate that even into that Walmart pay all those sorts of things.

[14:48] Interesting enough we run returns and to answer returns really in a custom problems with a huge issue for a second on Maclay and then.
At Walmart that the Walmart Media Group is it as the selling or so as the selling entity against their organization,
CMO. Samo and then I said that is supported by the customer care organizations what happens.
As you transact with us and and how do we support the customer service at the front entrance with folding the organization of the back in times of creating demand for the front and then supporting Anthony.

Jason:
[15:25] So that's an incredibly broad scope which I imagined doesn't leave a ton of time for side hustles.
And what do you think I predict admire about that structure is you you mention the polls to ask you most like it would early does sit
above marketing so like you know where everybody talks about sort of putting the customer at the center but you guys from literally an org chart standpoint are really putting sort of this customer ownership
like at the center of all of these different disciplines at Walmart which is to my knowledge.
A newer structure that we haven't seen a lot of retail in the past.

Janey:
[16:03] Yeah I think you're right and you know we have a lot of debate in one of the comments Frankie that I've heard is all well Jamie should see much of the glorified say it
how many different constructs we're saying Mo's Purity demand gen or another company so they have a lot and I like it and take her surgery you didn't hate me to talk about public affairs and Communications rights out Francis I don't have that cuz that's it that's it
different skill but to me there is a difference between
understanding and helping your organization really truly build for the customer and pull that through in an organization that has been built up on it
Orion's Belt tremendous scale 3 absolutely Flawless operation execution and its capacity to,
build create Source amazing products at great price please.
Those we need to continue to do and will continue to do but we need to make sure that we are mindful of the customer
that would that would join if that is really different from how do you create them and what do you do and how do you run a fully optimized Media budget which is in the end.
Billions.

Scot:
[17:16] It's amazing the the Spectrum you work with must make your head spin it must be hard to prioritize everything you have on on your plate.
I was going to shout out to listener is one of my favorite books I'm kind of a nerd on amarillo biographies when my favorites around the early 90s was Sam Walton.

Janey:
[17:36] So I was looking it up this morning actually cuz I was recommending it to somebody it's super easy read
sounds like it would be 90 but actually it's not and I will tell you that more often than not I go back I just didn't know we goes past I don't go back to take a little reader of a section office it's important to me as you think about the ethos of Wilmot weather is so much
goodness in that in times at the thought process Anthony the.
The unwavering dedication to building a business building at the right way and the the notion that.
You can democratize resale,
and just because you have less financial means I know you you live in a you don't live in a city does not mean you shouldn't have access to great quality items at really affordable prices.

Scot:
[18:27] Yeah it's like urban legend but isn't his office preserved in Bentonville and you can can I go see it and is that true.

Janey:
[18:34] Yep but yet yes I know yes it's God's office
so done right so I'm so dog sits in it now it's the desk we just did a sort of mild refurb of that space in invented also yet it's that and all its Glory
and you know I haven't asked.
But now I'm going to his eyes when we moved to a new head off his way. So we have met making a new home office I'm assuming somehow it will be lifted and shifted and actually we are we building a replica in the museum,
downtown Fayetteville to so that way you know we have it preserved at 2.

Jason:
[19:09] Yeah I've got a Funny Story I Heard tell once is that he's like.
Mildly a pain working in a historic office because he's like you know he's like when I first started I like asked if I could get a whiteboard over here and there and they're like they're basically like no you can't.

Janey:
[19:27] Images like what is wood panels and uses of walk in and appreciate that duck like rearranges the books or something like that to change things that you can change it but I.
It does give you a sense that she will walking in there and thinking about.
Show me like literally Disney ultimate entrepreneurial story.

Jason:
[19:52] And of course if you do read the biography I would argue his actual office is probably that truck.
Because per your sort of Chief customer officer comment he spent an awful lot of time in the field visiting stores and talking to customers and I I think in the early days it was driving to them in the truck and then and later days it was in the airplane.

Janey:
[20:13] Yeah I mean Sarah.
There are so many people still around a colleagues of mine who have in them so many missed Asylum stories but
you are absolutely right I mean it so he literally was flying over geography is,
and from the air and it's like the plane would figure out full that in a full that town where was the corner of Main and Central
Wright and salmon in and figure that out and then figure out that that's what you need to do a graph you put your store if that's not micro-targeting you know.

Scot:
[20:53] I want to start off the questions by kind of starting at the super high level so you guys see so many customers get so much data how do you use all those insights that are gathered to deliver better experiences for Shoppers.

Janey:
[21:08] It's a great question 160 and 160 million people shopping Walmart everyday
so we are trying to slice and dice and make sure that we
information is usable to do the sorts of things that we want to take from an experiential perspectives if you think about Walmart stata
it's primarily SKU driven right side it's really interesting to me because I was told it's Q level so I would say it's kind of at the base level
what we're trying to do is figure out how you Advocate that.
SKU level Day to you after Butte it to the right kind of customer right what does that cross across payment and is excetera think about is the diametric opposite of America special and you everything about the customer and I couldn't get down to skew
are we going to ever get down to what are they actually dying here I know how many bottles of ketchup we leave so the question is how many did JT die,
when did she use cash when did she use a credit card when you buy them online and when did she go to the store so we lie during a top
just in terms of what people actually do the other piece that we are double triple quadruple clicking on is.

[22:25] How are people actually behaving in the stores and what what are the what are they saying how are they shopping different man how do you use that to make sure that we are old mention that experience and Laura's
seek to rationalize things in the stores for operational efficiency with doing it in a way that makes sense.
Podcast medicine so that's a whole other realm where we have some of the day to we haven't spent a lot of time you know in.

[22:53] Some of the Behavioral Science components an ethnography and actually you know
space space evaluation as well as we think about bringing all of that together so you can come by and all of that day to what is it Louis to do it allows us to really think about who I desire until I get off,
what they really want with some degree of precision because by its very nature you know we serve all of America.

[23:16] Design for everybody because I thought that I bought it as you are busy designing for nobody at that point so how do we design those right experiences how do we prioritize while we go to sign those great experiences and I think probably most importantly.

[23:31] The way I like to say it is you think about going back to my sis I'm what made those first stools so great was he figured out where to put them
you have the right the right product in that was relevant at the right price point
I have really great people in the store who knew who you are and were able to welcome you in and you know it was a Gemini and mouth and Tums a fast frictionless fun,
personal experience I'm not worth trying to recreate that experience at scale with digital tools and so it's really how much can we,
understand about a customer based on what we know where do we need to open that right we don't know how do we old men that such that we can really create the sort of experience is that that most YouTube customers want
across channels and so you know I hate the word Albany but you know but still how do you let people
flow in and out of of online online offline various tools without making the experience really hot and ready Conkey
I'm really on a mission to try to make it fun fun to shop at Walmart physically fun shop at Walmart digitally so I'd like to bring some of that in them too.

Scot:
[24:48] Yeah a lot of the knowing I will talk about Amazon but you know I never said wow that Amazon experience was fun it was just kind of a transactional
I'm a I'm a four-time entrepreneur and I've done three B2B companies in my latest companies consumer and I found when I was B2B was always easy to say
customer first but it's actually been surprisingly hard because I found its constantly at odds with what the rest of business.
I've been dying to get someone of your tenure on a on a podcast like this and asked you that question.
How do you navigate that and cuz there's times when it's not right to do what the customer wants to know.
Retail returners or getaways price things that the company doesn't make money in surviving the customer still happy how do you think about that and then how do you articulate it into the organization so.
All the way down to that store associate a kind of understand calculus.

Janey:
[25:45] That's what the key to the code right.

Scot:
[25:51] You figured it out so I.

Janey:
[25:52] So I wish I wish I wish I could say to I wish I could say it you know the keys Dakota 62 or so I think,
can you questions go to I'll give you I'll give you a Walmart example if this predates me
you know how his stories of what we got a whole bunch of customer research and what we what we heard was that what we should do is put
at what we should move the pharmacy closer to Webb and it closer to grocery because that's a mission right so we understand that Grocery and Pharmacy tend to be a mission so let's move it away from where it is at the front so nice let's move it towards the food.
Turns out when you do that. That's great but his will happen if they go in and out either to the phones in the grocery they don't go anywhere else in the store right it's it's hard for us to be able to maintain the prices
that we have you in those those those everyday low prices on the food and the food and grocery side if we not
if they're not buying other things so what happens in the in the long run on the back of that decision eventually prices go up.
I said you said to customize hey would you like to have your Pharmacy in Grocery close together
but if you are like it but in the long run that's going to mean that you pay more for those they are to be no I'm quite happy to have to take that extra couple of seconds and so applying that business logic.
Is really important the way that we are watching it through is that.

[27:21] As I said you know I said it's my job to understand objectively who the customer is and what we're hearing from and I've what really hard to.
Build and preserve a voice of the customer team that has no skin in the game in the answer right and that is really important to me so they can be entirely objective.
But not solving finding they bring that forward we use that to them prioritize what we think based on in a whole series of mattresses you can which you can.
Probably figure out something frequency in and size and and then attempt to design the experiences of the solutions against it,
what I that need to do is as we go through that process is so it would bring it inside so we prioritizing I then need to turn to my,
a colleague some of the merchants on my cut my colleagues in operations or in a central operations are running the stores inside okay so here's what I think we need to do.

[28:23] How would we operationalize that and then what tends to happen is we'll say well I know that you want it you know I know that you want to design experience this way.
His reality right that's going to increase cost full-time but if you did it like pretty please find it this way until we take those ideas typically and we pressure test them and say what okay well how would we deploy that.
How and what do you think the intended and unintended consequences that we go back to that idea and it tends to get here and we modify but.
Make sure we haven't stripped out so much that it becomes you know I'm attracted to the customer so it tends to be a super purest start.
Then we can I let me apply some brain power ran into prioritization and then typically as it goes into a coyote operation eyesight.
You come back to actually maybe we solving and with wig Recreation too many problems on the back end or something she was actually.
We can solve several of these problems at one time if we get if we just move some move some things around and so.
Who is it giving tight though between Arrow obviously.
I would like to roll out reptile pets welcome people in high five than when they came in right I'll be able to recognize who they were and have everything ready pack for them.

[29:40] That's not going to work right what is super important to our customers is the consistency with which were able to deliver.
Great items at everyday low prices so number one delivery point is that all the time and then it comes and then comes behind that okay.
What's the right experience that we can build to sit to support that.

Jason:
[30:02] It's funny as a very young man I was pitching.
Some new new customer experience to a merchant at Walmart and I'm not going to date Myself by saying how long ago this was in the merchant was talking about the operational challenges and I'm like yeah but.
Like you would know this is a much better customer experience and the you know this this wise is Walmart Merchant looks at me and goes Jason White carpets would be a better customer experience to you're probably not going to see those in a Walmart.
Right answer to me like I feel like the inside you have there is is like preserving the voice of the customer in respecting the voice of the customer about putting it in the context of.
This this is larger ecosystem of experience I often you see people make the mistake of just like.
Asking a customer questions getting a customer preference in a vacuum and prove your point.
Is a very complex ecosystem with a lot of inputs and outputs I want to continue the trend of asking you hard questions that we don't know the in.
So I have to be honest like to me thinking about your role one of the things that makes it daunting is.
Typically marketing you know we we try to Target the particular customer right and we think about segmentations and I'm going to Tracy's personas and you know I know Walmart of course has has the Persona of the famous busy mom persona.
But the challenges at your scale you guys are so huge that hundred sixty million Shoppers a week the.

[31:31] Almost any Persona you you create is then too small to be economically relevant to Walmart so so how do you do Marketing in personalization and targeting and world and wedge,
like literally everyone is your customer.

Janey:
[31:48] So the way you are absolutely right funny that my first kind of couple of weeks and he going you listening tool so I went round am I listening to and I say to everybody okay so who's the customer.

[31:59] And everybody would say what everybody would you mean everybody that it will everybody and I don't know but who is the Target customer,
I understand that you serve everybody,
that does not mean that should talk account some and soda so just as you know you see in a McDonald's is a great example to me right now
people that you see the wife and it's going to be pretty woman the people that you see in the McDonald's advert probably
on a real direct reflection of the people that have something in in in my gums every day but it's a reflection of where they want to go in and what that Target is inside the difference between serving everybody and designing for very specific Target and so
we have done a lot of work on this this idea of the design Target you're not new to it to anybody listening to this you know and we talked about this busy family
spaying a design Target and then we sort of thing about this Continuum these busy families on this continuum
with an entry the Continuum is what is the ultimate driver at any point in time they do they do Flex between.

[33:10] Money in time right everybody
everybody no matter where you are and what is it some point balancing off money in time I'm so you think it went and we think about that designed talk about how do we how do you think about
where we where we playing to be financially.

[33:29] Sensitive busy family it's probably what you would quite to the end to the to the Walmart Shopper but you find interesting things in that like you know it's still not going to go to
15 stores to try and find in a package of pasta lower price that looking for consistency
in the goods they buy and access to the right to the right sofa brands.

[33:52] To your point about making it smaller obviously soon as I start took him at busy family she was exactly that's productive right that's smaller than the entirety of who we still have you not wrong,
I'm so then what we did was a whole bunch of statistical work to say okay well he think about the segments we've done a broad segmentation have six segments across that 160 million.
You think about that how do we statistically correlate to the actions that we would take on behalf of a solving for the busy families
correlate strongly enough to the other segments and so you know I was have this child that I said what round that has this in a ring which is these the time-sensitive is he found his we must protect them they are a cool right we protect them with
always living on everyday low price and in Iran and trying to create the best sort of experience and if we do that.
I know that those are cool to also helping yourself that more,
time sensitive busy, you still needs everyday low cost and infection is expensive but once more than once a mortgage last next to that really wants this little buy online shop shop still components
and then you start TNS you pull out of that Circle we've been correlated those actions that you would take
against the other of the six segments that we understand where we want to how deep we want to go in and how broad you want to go and so we've been working through this.

[35:11] Better part of a year now I think that lens I'm just starting to see most conversations now start with.
Yeah he's abroad picture boy we want to go as we lens for that you know that time since too busy family his will how we might start to think about making slightly,
different decisions don't get me wrong this is not about you know.
I'm moving away from opening price Plano moving away from Braddock go to or any of the above but it allows us to start to think about how would we back to those Janice how would we prioritize where we would do things like
cake ordering all the work that we're doing install maps or you know that what that we've been doing you seen as talk a lot recently about online grocery pick-up and now about delivery those are the sorts of things that you start to look at when you say what
if if time becomes even more of a fact than we thought it was before how would you solve these things differently right lot of work not on the product side now round things like
read email so healthy read emails the busy busy families can run in and pick up at our great-great alternative to pick him up fast food on the way home right side suits that are not true selection right how to how do we do that so it's starting to lens the way that we
crazy experiences and we and whistle and it would have sold the stores.

Scot:
[36:33] Brickell I'm the I'm the e-commerce side of this podcast partnership in.
Love marketplaces I've started Channel advisor which is a partner of Walmarts and so I couldn't go on without asking a Marketplace question so walmart.com you guys.
It took a while but you guys really have your sea legs on the marketplace how do you see that kind of tying into the customer experience obviously caused an explosion of selection but where are you guys in your thinking around the the. Com.

Janey:
[37:03] Super important to us so I can you think about a top priority issue him up till you know what will talk a lot about Marketplace of putting time as a brain power
Thor in into that why do I think I'm making sure that I'm Marketplace experience is good enough right.
I'm not in a we recognize that even though you might be buying it from Jamie's toys. The reality is
you have coming to walmart.com to buy that and we need to make sure that we stand behind that experience I'm have the right tools and capabilities to do that and that you are not in any way disadvantaged by buying the marketplace I'm right so I'll give you good example.
Why.
It was really important for us to make sure that if you bought a Marketplace item you could return it in the store as well as online right in that time I didn't say oh I see that you bought this is not going to take it back.
Sounds sounds easy but does really hard right side of building a marketplace where you've got fed party sellers when you've got such a you know such a big physical asset is hard.
But it's really I think it's really it's really important because.

[38:16] It's important we have a large selection of items because the reality is I don't want a customer to go anywhere else.
I want a customer to be with us super frequently for groceries and a frozen consumables and we feel really good with a forward-deployed inventory in a in a butt in time is a 95% America to get that frequency.

[38:39] When you're shopping with us her groceries I want to go to fill everything else right I'm so you know and I'm frankly.
Yeah I thinking is you should be able to eat and we should be able to be able to pull people through which is you come to us day in and day out cuz you know that we going to get you those great groceries.
But we have a great selection 1p items that you can add into your basket and by the way if you want to that for the super random thing that we are we are not economically going to have to carry you can get it you can get it now at the same time.
It's a package same bundle yeah what one click away so I think it's really important as customers start to.
Curate.
Whether they do it I know she had to do it deliberately or not I think people are starting to curate how many places they actually spend time in the past you think about you probably show up in like 30 or 40 different sites.
The one thing Amazon has got people to do right is to just go to one place instead of talk about it as the library affect right my kids.
Use I'm literally lose Amazon as a lively right is turkey disintermediated Google they just go straight into Amazon and becomes it it's really important for us we have the capacity to be able to dislodge that,
with our you know it with without differentiation that's at the Forefront when she's always say that the grocery component.

Jason:
[39:59] Like it is interesting a lot of these like new digital behaviors are creating.
New opportunities but also new challenges so like want you mentioned all the progress you guys made with online grocery pickup.
I'm a huge fan Advocate it just seems like every time you talk to a customer that's all white changing experience and it's easy to see why busy families are.
Quickly adopting this new behavior and it seems like you guys are killing it on for filling that behavior The Dilemma in my mind is.
You got these beautiful stores that are designed to surprise and Delight people by discovering other products they want to buy when they come for their essential oils and you've got this you know,
super valuable center of the store where we can discover an instapot while we're we're shopping for our groceries or Pharmacy or all these other things
and for sure there's a bunch of purchases that in my mind a lot of consumers and never put on a shopping list like I never put the Oreos or the gum on the shopping list I secretly sneak them into the cart bike at the last minute so in the world.
You're helping everyone sort of transition to shopping off of a list and doing online grocery pickup.
Is there a risk of losing that that impulse purchase and that that you know how to how do you.
Help customers discover new things in a world in which you're sort of forming a list habit of you will.

Janey:
[41:18] So is Mariska.
I'm working really hard so yes and I think it's two-fold right one is
even though you might be doing pickup.
We still need to create a really great stores that exactly do that right surprise and delight and every so often you going to want to come in
right and so how we do that and think about balancing when we pull people into sores versus when they didn't pick up,
really really bored so thinking about the physical dimension of this and then on the the digital space you're absolutely right like how do you
how do you.

[42:01] Create that impulse purchase behavior and where do you know where do you do it in the van so which I seen him in a lot of ways of where in the purchase.
In the in the patches funnel do you do it the high-end you want.
Is it Joy Lights of the discovery phase right is it is it through the checking out phase is it through in a
do you want a present product upfront I see that you're buying bananas and you should go get during these other things and where do you want to use different sorts of tools.

[42:31] Digital allows you to do really interesting League you get it right I'm taking about your very first question about dates or is
we can actually start to and I do things so we can have done somewhat with BuzzFeed on shuffle
I like shoppable recipes you think about the generation of that this world and make sure you could say I'm feeding a family of four
and once got celiac disease and one is in one has a biology I need six meals right prison to it right presenting percent what I should
why should be able to do by
oh and by the way they still miss Tita here are a few things that you might want to think that I would even chew it did I all we know who else is in your household so let me show you those things.
As we think about services like in home what's super exciting to me about that is somebody going into the home how about we start to think about
physical training of products right was so if we know that you've got two boys at home when doing groceries how about we drop off these four or five things
if you like them keep them if you don't we'll pick him up when we come back how do you how do you start to think about.

[43:41] The services that we have on the predictive are the predicted nature what we can do to release a type of pus license and just think it's just a surprise until I feel that the impulse in a different kind of way right.

Scot:
[43:55] That's a sneak, like predictive for or try before you buy kind of.
One thing that's kind of rocks e-commerce world it's kind of funny if you think about it is Amazon's come out with a bunch of private labels and everyone's all up in arms and you know.
And then you read that that Sam book and he talks about the Old Roy dog food or is it old what's the dogs safe.
How about I think what is Amazon's done though is that kind of taking it from you this is kind of like the product you bought two what products are like this kind of found this customer segment.
That wasn't there before and they've created a whole new thing and targets gotten really good at this as well where where are you guys in your thinking about that at Walmart of private labeling and how that fits in.

Janey:
[44:51] So we have a.
Big and very fast growing really exciting private label business across Walmart right on the stores have that long for you, and you think about some of the
Rhymes that sit within that on the Walmart side and on the same side I sometimes amazing private label products to,
so you know that continues to get a lot of time a lot of attention a lot of focus on his idea is really like really growing and we are super excited about we will continue to do that and also that both,
online and offline
obviously we have acquired some direct to Consumer Brands we have created some direct to Consumer Brands everything from soda prenovost to it to Old well and that remains an important part of a strategy
I know we're thinking through which brands are going to be online or online-only and when and why should things be sold in the stores will continue to do that as we round out that rotor assortment.

[45:55] And then I think that's an interesting piece you know for me in the middle which is how do we think about.
Next-gen which is not in a.
Make a scene and I can let you know I make his Mark products private label products or in a great value toilet paper but you think about the work that we've been doing to incubate product either ourselves with Supply so I think about.
Kristen and Dax and hello Bella or I think about some of the work that we've been doing and they are not in the ladies ladies shaving space on we've worked with,
big Brands to to develop custom product
it's that sits in at 6 and I stores you can grab the apparel space weather is the weather going to be like Alan and Sofia and that collections scoop,
you know I take a class at New York fashion brands that we both now and now we have that collection so we working through the many various ways we can think about using different brands within the family and and how do you deploy them,
I think what makes us very different now is it is not our intention to,
ever bring people into the Walmart family sell their products online and then use that to you noted to use that data to then.

[47:16] The time and where we want to get why we want to put private label product it's a different approaches with incubating because I was a two shows us that the arrow
price that either adapt in the market or is it capital particular price point in the market must put in Italy open price point Verizon in in many cases I think we can create
product the right way about that price point and that's really really where we going.

Jason:
[47:49] So there's a side pause here that I'll fix we were just sorting question.

Janey:
[47:50] We were just sorting question.

Jason:
[47:56] We just put a note in her on the time so I don't mess up.
That makes total sense I want to go back to you earlier when you were talking about your scope you mentioned a bunch of the things in one of the things you mentioned that you don't hear all that much about is Walmart pay we we have.
We spent a lot of time talking about digital Wallets on the on the show and sort of,
consistent theme is there all these amazing customer experiences that happened in places like Asia.
Haven't been a successful here and my friend this is part of the reason they haven't been as successful here is there is not.
Super convenient seamless digital wallets like they're their there is an Asia either promise that Walmart pay is secretly more successful and meaningful than.
A lot of people give him credit for and you guys just don't talk about it that much so am I am I wrong is it an important amenity at Walmart or or Walmart shoppers using it and had Patty you think about it.

Janey:
[48:55] Yes I just did the first part of that question.
As we think about you guys you do it I've been studying it super apps I would obviously a particular prevalent in in Asia now it's interesting when you take a look at my super apps
I mean most of them developed out of what I tried and then and then group
elements is usually the consistent glow across all the super apps right so as we think about where we go with
with Arab stretching super apps you write won't pay becomes interested component of that so I'm I mean won't pay is
is successful customers use it if you look at a licensed in the latest credit card that we just went through Capital One right you enroll at in Walmart pay you get a significant Advantage from doing that
it is a Hope In Our intention that we leaned into that mall in store maybe around the store right around the store and in your in your community so.

[49:56] Creating opportunities to just make it much more Flawless and if you enrolled in Walmart pay we know more about you and that's for we pretend she can offer you a series of experiences that we couldn't
if you didn't know it's about as much about you writing so so me making sure that there is enough value
and functionality in Walmart pay the people choose to enroll and engagement not just download it but engaging it
is super important because then that means I can get more right I can get more information about you which goes back to me said that I can create much better experiences for you right I can,
gets come and go or at United We will we will know more about your behavior which might make up my allow us to do different sorts of things on the back end in terms of returning products or not unlocking out of sorts of things inside it becomes it does become
for us that glue that allows us to then start to think about okay well how do we create,
all the sorts of in an ongoing experiences this what to do right it's not where it needs to be and we need to create more of an instinctive reason for being in and benefit.
But it is important positive of how we anchor in and where we go I'm going.

Scot:
[51:15] It wouldn't be a Jason Scott shoaf we did talk a little bit more about Amazon we also talked a lot about Walmart.
But you mentioned I think you said when your kids kind of got trapped in the the prime prime trap and it's hard to get them out of there
we seen a lot recently is Amazon you is using that and if people are starting their and now they're pulling ad dollars away from companies like Google.
Go to Walmart's made some moves in the ad Network.
Space is well soul of your thoughts on how do you view advertising and and maybe been a broader question of how do you how do you use their stop people or get him out of that.
Prime trap that you get stuck in.

Janey:
[51:56] So stop with the prime trap I think you know.
I firmly believe that there is a Tipping Point one way or the other white right and there's a Tipping Point that got people into Prime
all the stupid people that get people out of prime I think it's a price of prime goes up right people to come over flat reflective on
what am I really getting into and what do I need so the number of times that I people have people say will I get free shipping with prime I know you just paid for the beginning of the year so free
differently is is really intriguing it says you think about the Tipping Point on oan and you think about the services within the
how do we know which customers to really start to take a look at
is it really worth it run if I can get same Goods or more Goods at the same or better price can system at the same delivery
do I really want to be paying $129 a year for
whatever is The Marvelous mrs. maisel and the content that that we've got six how do you nudge people how do we start to show people that are
better options at Outback the pieces of this and then and then again then the Tipping Point starts to come up and now I need to evaluate what else is in there and and what do I get on the ad business yet I mentioned I need the Walmart Media Group.

[53:18] Yeah but saying you dismiss for us and so we are,
committed to building a world-class a world-class what I caught a world-class advertising business the people would be proud and would choose to advertise on whether it's at Walmart or not
why does a difference between leaning on the supplies to do it but this is this is this is a platform that people want access to an obviously
about just got to the deli put the more that we can slice and dice and and a half back today to the more attractive it becomes.

[53:47] What I think is different about what we are going to do and I philosophy is we believe in creating really great
customer experiences and creating an environment in which you can continue to trust Walmart to do the right thing
buy you as a customer on biodata I'm so we famously
commit to Everyday Low Price Rite he famously have shunned you know some of that you had to shopping boxing gloves we haven't taken money to be able to place products in stores we are not going to break that philosophy not ethos online we will only
any experiences that we sell against will be in our opinion a creature to the customer
and so are we spend a lot of time actually tweet we've been told him he's going to the plans look at do we believe this is good for the customer is it confusing,
do they actually understand what's going on here.

[54:50] Would we be willing to corrupt search algorithm no right those results around and there are some decisions that we've made very recently about things that we will not sell because I don't think it's in the in the in the best interest of the customer so it's a different ethos that we have around
Walton Walton way we can do and then one that is absolutely predicated on
the Trust on privacy and security of your data that I think it's is potentially like him with some of the other models out at today.

Jason:
[55:19] I do think that's one of the fundamental challenges like is sort of digital advertising for retailers is a relatively newer phenomenon and everyone struggling with.
You know how do you maximize your business opportunity there while still saying customer-centric and you know there certainly are a lot of people that feel that like in the case of Amazon particularly.

[55:41] Visited while taking money and in some cases like aren't giving customers the best search results as a result so it's it's interesting to see how everyone sort of makes those decisions for their own business,
I'm super happy we've been spending the most of the time and in this conversation talking about things that I view is sort of core to the customer and in super relevant,
intermediate for today and not a lot of shiny baubles but I got to be honest I wasn't do kind of like The Shining pot.
Pivot for just a minute to sort of innovation and you know you follow the Walmart there are a bunch of sort of cool Innovations you got.
Alphabots you've got you know that in real life store that's not far from here Sam's Club Now jet black all all these sorts of things.
Any of those projects that you think are like you're particularly excited about or that you think are likely to turn into a.
A supervillain and customer experience I got I would assume a bunch of those projects you'll learn things from.
And then you know maybe it'll be a different iteration of that that ultimately delivers on the customer promise like what what should a listener's look forward to.
Really double down on at Walmart.

Janey:
[56:54] So it looks like I got it the secret of one away which is Walnut was seve how to stop at store right this would have liked future so,
first woman to spot in is is what I took right and so super excited about
the capability and the service that we can build that what that actually what that actually means in terms of I love the idea of somebody coming in and putting groceries in my fridge mean never having to worry about them
and then where do you take that in times of maybe it was not just groceries could it be and I could it be prescriptions could it be something else by the way when's the wedding if I come in once a week and pick up my dry cleaning and where else can you go in the service
where else could we go with Hardware right so can you move to full auto replenishment right can you start to think about it
is all sorts of super interesting ideas we've we've got in there that could be controlled through the what if you had like ovens
but you could Papa you know what I'm really great ready-made meal in before you left and didn't you could you could set it at United to Cookeville right from your phone when you're on the way home from work except really excited about that black I think
conversational Commerce underneath that is really interesting to me as his voice.

[58:17] And you know the capacity to be able to walk around create list when I show up.
I always forget something that I and I couldn't check out my oh shoot I should put apples and I should put something else in.

[58:33] I love the idea of an episode of war and you and any point a text but when I say apples it knows that you know
will but we know that I buy in a full pack of organic honey honeycrisp apples it's not it's not coming up with anything else it becomes super plus nice to you and you I'm really excited excited about
conversational Commerce capability where it allows us to power at scale we get back I think it's great and I
I use it all the time I left you may have to just text and I.

[59:06] Kitchen paper and it's apparently off. It's here in the afternoon this in a meeting say I like but the scale of the conversation, spiteful.
It's something that I'm I'm really excited about and obviously at some point we need to.
Leaning upscale to what you're seeing about whether they see IR else will someone for Jamie's done with the signs and Times of Skyland go in and out right you don't have to check out lines in the store.
Is an issue for us it is an issue for us ticket holiday time because he wants me to find him waiting in line how do we stop to not make that have to be a reality for customers.
But do it anyway the design on the back end so I would be remiss if I didn't say there was so much innovation technology that is going into.

[1:00:00] Think I got pick up Tawas which of facilitating online grocery Central operations Team all doing in and around the stores,
to make them in a tip to make it be able to lean into this customer experiences and to appropriately ultimate when he did.
All the rarest gives us the end of the fiscal capacity to be able to do some of these other things I'm about half the customer or on behalf of the associate there is so much Innovation Frank is going into,
yeah they've even got the training academy is and some of the virtual reality would doing in the and some of the things you're going to see is coming out with this year or which types of leads its way back to creating a,
more efficient happier Associates who create a really great customer experience and I'm so that they also.

Jason:
[1:00:52] Nice I have to admit during an answer the one thing I did have some sympathy for the poor jet black person that gets your orders cuz that's got to be like high stress when the boss is like ordering stuff,
and it supposed to show up quickly at her home the it's funny when you guys first announce the in-home you know I got called by a lot of media that want you know they're quick sound bite in the the
typical narrative was our consumers really going to trust a stranger. Coming to your home and in my typical answer was.
Like that's not comfortable Behavior today that's not what we're all used to,
but if I'd come to you five years ago and said are you going to trust calling strangers on the internet to come pick you up in their car you would have had a similar reaction and you know customer behavior is obviously.
It's it's easy to see that same shift happen.
With this in-home opportunity like you know if the amenities are there and to me the funniest thing was when you watched it.
One of the first in-home services Mark Lori did and of course you have them all wearing body cams as a sort of a security measure and I'm chuckling because I'm like.
If there's one person I'm not worried about stealing from me it's it's Mark who's made quite a lot of money on his last last two companies.

Janey:
[1:02:07] Yeah you know what is interesting though.
About what you say is you're absolutely right right mean the as you come up with an idea wouldn't be great for groceries if we can put groceries in people's faces that that's great.
I don't know that I want a stranger in my home what I really excited about sign who leads the team and he's got an amazing organization what I'm most excited that they did was they said Okay so.
What was solving for is he asked the other logistics behind being able to do this but that's irrelevant if we don't solve the trust Factor.
So what are we going to need to do to solve the trust factor that has gone if that has done everything from,
the locks that are put on in and the security behind not behind the book The Body cams
behind the selection the training of the associates who do it I'm Frankie like how do you protect the security of the associate 2.
And in many cases and so it's a really interesting case study of actually solving for the intangible which is the trust component.
Is
Much more important in solving the tangible right and you know we're still we're expanding our testing and I was still going through and had how do you start to scale something like this spot.

[1:03:26] It does
it does require you to do things something different and announce never going to be for everybody right it's never going to be for everybody it's not you know and it's always going to be higher touch
interesting Lee you know economically it has some some real positives for us right as well but it's just it's so being that intangible
what are the things will you have to take off
to make somebody feel comfortable having access to having access to your home and those are the access pieces and then looking somebody comes into home and putting groceries in your fridge
I'm a mess up the fridge I know they said they squash things are they put them in wrong are you going to admit all of those levels of how do you get somebody to relinquish control.
Of that customer Jetty patrolling Kush control enough that they not worried about
the security of the delivery component right after the execution of that cuz otherwise it's not taking that stress away from somebody right they just sitting there watching watching to make sure it's happening the ultimate goal and Harry's you are so trust you you're so trusting of the service that you forget they have to do it.

Scot:
[1:04:36] Just like an Uber type experience where it's become so second-nature now that you don't really.

Janey:
[1:04:41] Right I mean yeah I mean you don't I think something and then when you get those spikes and something unfortunately terrible happens.
If you start at that is now shocking right it's it's become such the norm that when something terrible happens it made you know you like it wow
several years ago right I mean I grew up in the UK and grew up in the world right now in London
can cabbage. Puff the knowledge you need and they were like bag and I don't have that the notion of.
Somebody could I could become an Uber driver tomorrow riding on a mini didn't even think about that
you getting into a car with a stranger who probably doesn't know where they going is relying on Waze Stevens and even tell you where the real trouble Rock.

Scot:
[1:05:33] We really appreciate your time and we're kind of getting up to time one last question we were to hop in our retail time machine trademark Jason Scott,
and go to 2030 explain to listeners, like what would you love for that Walmart shopping experience to be like kind of 5 to 10 years in the future.

Janey:
[1:05:55] Who's great question.
I'd love for you know I'd love for our stores to still be around but to be really interesting gauging places where people went to enjoyed going,
and when and when.

[1:06:19] To have fun as opposed to it you know so the bracing yourself to go and do you get your weekly shop so how do we create all the fat but then how do you augment that.
Gigi's Lee beforehand so that you know when you're in that you can actually focus on having the fun
and you know and I'm just really grateful us experience is so it will actually you're walking in and you've already pre-ordered your gross is not coming to you but you know you're able to.
Donkey basketball with LeBron in the sports Department through virtual reality right or I shall getting close to the store we're reminding you that it's your nephew's birthday next week
what's the packing groceries why don't you go take a look at Lego and you know it's probably how you got eliminated reality popping out of your phone right and you're able to do
but you know most of the tasks while still that I think is probably way to go but like for us.
You mentioned it earlier but nobody ever says that I mustn't fun right there's a functional nature to to retile particular in the retail space that we're in with.
How do we how do we turn that that functional into
antiphon I want things a fun you start to engage with the more and so it becomes a real it becomes a want to do buses I must've really excited about doing the grocery shopping at Walmart,
that would be great.

Jason:
[1:07:45] That is an awesome vision and that's going to be a,
good place to end it because it's no surprise even on our fourth anniversary show we've completely used up all of our listeners allotted time,
Janey really appreciate you taking the time to come chat with us and share some of the Visions for where Walmart's going as always if you enjoy the show feel free to leave us a comment on Twitter or face,
and I for sure if you haven't done it already up here for years in for God sake It's Time to Get on iTunes and finally give us that five star review.

Scot:
[1:08:18] Exchanging really appreciate you taking time to be on the show and helping us celebrate 200 episodes in 4 years.

Janey:
[1:08:24] You are very welcome honest be here thank you.

Jason:
[1:08:26] Until next time happy commercing.

Nov 21, 2019

EP199 - Dreamforce and Retail Earnings

Episode 199 covers the 2019 Dreamforce Conference as well as this weeks news including Walmart and Target earnings reports..

Dreamforce

Salesforce held their annual Dreamforce Conference in San Francisco this week.  They launched a major new functionality "Customer 360 Truth" a universal customer data platform.

Singles Day - 11.11 Day - $38.38 billion US (up 26% YoY)

Earnings Reports

Other News

Don't forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Episode 199 of the Jason & Scot show was recorded on Thursday November 21st, 2019.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott show this is episode 199 being recorded on Wednesday November 20th 2019 I'm your host Jason retailgeek Goldberg and as usual I'm here with your compost Scott Wingo.

Scot:
[0:39] Hey Jason and welcome back Jason Scott show listeners,
well that's pretty exciting times here it's November 20th we are about seven days away from Thanksgiving T minus 7 Days folks to Holiday kicks in
some would argue it done right after Halloween but I like to think of it really kind of kicking off at Thanksgiving,
Jason was kick-off I saw on Twitter Some Noise around the world's largest Starbucks where you the first person in there.

Jason:
[1:08] Sadly I was not a side note on Thanksgiving I've been training all week by eating pumpkin pies.

Scot:
[1:14] Nice already.

Jason:
[1:14] Getting ready. I think it's a rookie mistake to just go in the Thanksgiving cold without a good one.

Scot:
[1:21] If you been pumpkin spice latte into it as well.

Jason:
[1:25] I don't I stick with my classic ice cream key around I'm weird.
I did try to get my classic iced drink at the world's largest Starbucks which opened on Friday.
So a little less than a week ago in Chicago,
and I struck out so I was out of town Friday I went there Saturday morning at 8 when the store scheduled to open and there was already an hour line waiting to get in.
And I had families in toddler with me so I we had to abort in.
Do a plan B so I'll have to go back and visit another time that kind of an impressive draw that it's drawing that kind of crab for a retail store open.

Scot:
[2:06] You think the world's largest could hold more people.

Jason:
[2:09] That was my promise I actually thought they would be popular but it would still be easy to get in because.
It was on Michigan Avenue which is like the premier shopping location on in Chicago and this was formerly The Crate & Barrel flagship store,
so it was a four-storey 40,000 square foot furniture store that they've converted into a Coffee Roastery.
So my assumption was it could hold an awful lot of people but apparently they're still you were still sort of them dating how many people they let in.

Scot:
[2:40] Is this one of those doesn't really have much mobile order it's going to be a food concentration there's no venti takeaway cups all that kind of strangeness.

Jason:
[2:51] Semite so that the concept of this is called The Reserve Roastery I want to say it's the like this one.
If I have this right the first one was in Seattle there's another one in New York this is the third one in the US there's one in Shanghai there's one in Italy on which is controversial,
enter this is like the premiere Starbucks concept it was a pet project of the founder of Howard Schultz the founder of Starbucks.
It does have all the regular stuff you could place a mobile order there you can get all your traditional drinks.
But it has a lot more stuff so they roast beans there and if you go to any Starbucks anywhere in the world and you buy a reserve being the beans that come in the the black and gold Packaging.

[3:37] I got roasted in one of these roasteries so they're so it is a commercial Roastery but then they have kind of a you know it's a it's a beautiful.
Kind of handmade Roastery with all glass windows so you can watch them working and they have kind of a Willy Wonka set up where they have these,
translucent vacuum tubes that lead from the Roasterie to all the coffee bars in the in the building and said the beans like,
fly through the tubes over your head so you can watch the beans getting delivered for making coffee.
Any of your classic drinks with a much wider variety of beans that make a bunch of other drinks that aren't typical they make a bunch of drinks mixed with alcohol that have ice cream that was stand-alone restaurant everything merchandising section,
this is all based on the other roasteries I visited and I'm assuming that what we're going to see in the Rock somewhat localized so when I'm assuming we're going to see you soon.
Cool architecture in some variation of all that in this the Chicago store will have to report on it after I physically get in one.

Scot:
[4:46] Awesome well I'm here at home in North Carolina and you are out in California at drink for so tell us what's going on at dreamforce.

Jason:
[4:57] Dreamforce has the annual trade show for salesforce.com sales force is based in San Francisco so this is kind of on their home turf and that I saw someone refer to this is a quite Big Show it's it's every hotel room in the city of.
San Francisco sold out I think I saw that I was like 40,000 people are here attending it so they they call it Burning Man for people with jobs.
Which I thought was pretty funny because there is a lot of like chocolate brand building entertainment experiences in addition to the sort of.
Salesforce product experience is so that like really extravagant.
White outdoor Forest that they built in they give away free expressos the forest has like.
Like a redwood tree that you can drive through and you know all this kind of cool stuff and have a lot of celebrity speakers,
show Emilia Clarke from Game of Thrones this year Megan Rapinoe dying from USA World Cup team this year,
a Beckham the musical act is like Fleetwood Mac and then the the big headliner Tina I mean Tim Cook is speaking but the big headliner is Barack Obama speaking tomorrow so they get a lot of.
Interesting to listen to people that are you know probably not talking about the marketing cloud.

Scot:
[6:23] Yeah and then so then they that they talked a lot about a lot of social kind of stuff obviously so that the CEO of Salesforce is really into that and then I usually wear like crazy shoes.

Jason:
[6:37] Yeah he likes a mark Billy off is a very Progressive CEO and he be like there's a lot of really good causes and so we highlight some of those,
on the stage right he's built through hospitals in San Francisco and sponsored some public schools and things that are kind of cool but they do they have like they have content about helping people to,
be more Mindful and they they have a whole exhibit full of actual monks that are helping people to meditate you know they have a lot of bad like Arianna Huffington talking about like.
Trust and transparency and yeah I just I mean yeah she wouldn't go into the sweet thing but.
Yesterday they have a lot of people talking about like their pet interest which are you know potentially interesting helpful lifestyle Tibbetts.
But then they also do generally make some big product announcements at Salesforce and and so like.
I'm not sure this is going to go down as the biggest year but there's some I guess I'm reasonably sized interesting new announcements.

Scot:
[7:46] How much of the show is there like a track for e-commerce and an of the you know they're there I guess they called the Commerce club now is that a thing or is it.

Jason:
[7:59] There is there so there's a there's a Commerce track Commerce is like integrated into the the Keynotes along with the other clouds but I will say.
They're shifting a little bit more from products to rolls so,
when they were product-based like the Commerce cloud is about e-commerce in the marketing cloud is about sending emails,
and you know that they're kind of Shifting the content to be more roll bass content so it's a retailer or a b2c company and that that roll.
Yeah would obviously you need Commerce and marketing cloud and CRM and customer success rights are there.
I would say like they haven't completely transition there still are definitely some products and Trick Tracks and there's there's a stand-alone Commerce keynote for example as well as some.
Dedicated Commerce content in the the main stage keynote but I do think I feel like it is Shifting more it won't surprise me if a couple years from now there's a retail track.
Not accomplished you know that's a pretty reasonable thing to do.

Scot:
[9:07] What are the highlights of utena the show.

Jason:
[9:09] Yep so the a big one so one thing that like.
Obviously is well known to you but you know very first Cloud companies so in fact when they launched the company they launched it at Oracle world and they they did like fake picketing outside of Oracle works at World saying like.
Like free software you know and put it in the cloud and it was you know this whole like counterculture thing,
and anyways I still feel like they are a really good example of the cloud like they,
it took a lot of feedback on features from their customers and their customers can vote on the features they most want in every quarter they do a new release and you go to the home from work on Friday and you come back to work on Monday and suddenly you have all these new features,
that where that features most requested by their customers and so that doesn't sound like rocket science but a lot of other Cloud companies I still think like.
You're not getting the full advantage that you should from the cloud and so at the show what they tend to do is release some major new feature.
It's free and instantly available to all the that users on the cloud so I can couple years ago they launched Einstein which was their AI module and it was,
you know a free new thing for all their customers so this year they watch them a major new platform that's free to August and customers of customer 360 true.

[10:32] I think they're starting to struggle with their naming conventions a little bit here.
But that this is is interesting like I feel like this is very on-trend so it's a couple of,
can a customer data features rolled into a meta offering so the Met offerings called customer 360 truth and I think truth stands for kind of,
the single source of Truth for all customer data and the the modules inside of it is they have kind of a data manager that lets you map all your data from your various Salesforce and non Salesforce systems,
into a single Universal.

[11:10] Data platform so it's based on customer and it has a unique ID for each customer so like normally we would call that a CDP or a customer data platform,
so it seems like Salesforce has launched one and they made it free to all their existing customers,
and said that the actual example that use on stage was a retail example they had Louis Vuitton they commented you know.
Despite the fact that Louis Vuitton uses marketing cloud in the Commerce Cloud that the you know the keynote speaker bought some cool Louis Vuitton shoes.
Last week and he got an email you know marketing on this week because the in-store POS doesn't know you know that the the email system doesn't know that the insert POS old shoes.
I'm inside with this new 360 data manager you can't.
Relatively easily Plum all that data together and then the marketing Cloud knows to you know Market stuff to people that already bought their shoes instead of,
to try to sell you the shoes you already bought so,
the CDP space is pretty popular right now makes total sense that sells words would be in it kind of big news that they are not trying to sell it but they are giving it away and because they a lot of companies already have a lot of their data in Salesforce.

[12:30] That's a pretty big competitive advantage of its kind of one click and you load all that data and all the data mapping and stuff is already done for you so that's pretty slick.
New problem we're all struggling with is data governance and privacy,
you know there's a European data standard and the California did a standard goes Live January 1st and so suddenly we all need new metadata about,
who has permission what rights to us or what data and how we collected and all that sort of stuff so
part of this 360 trap trust is a privacy and data governance module which is a product a lot of people are having to buy right now to get compliant so that's interesting,
and then they have a customer in audience is module I may have the name wrong,
this to me sounds sort of like what we would in the advertising space traditionally call a DMP or data management platform and so this is kind of,
ability that take all the state of that you now a aggregated,
and like create audiences and segments for specific campaigns and specific uses so it's the ability to do really sophisticated slicing and dicing of all this customer data you have,
and the work with it.
Known data IE people that you actually know and also unknown data IE you know an honest users that I've text you but haven't identified themselves,
so that's kind of a pretty comprehensive interesting product that they want that's basically available immediately we stand.

[13:59] In their sandbox so I'm sure some customers are excited about that.

Scot:
[14:03] Is the CDP thing on acquisition or something they build organically.

Jason:
[14:06] To the best of my knowledge they built that because I am not familiar of this specific acquisition there are like,
a lot of the plumbing like so a big part of this is is data mapping and transformation and they they bought a very big company in that space mulesoft.
Last year so it wouldn't surprise me if they revered some of that capability in here but you know they also had new announcements around how you'll stop is developing as a standalone tool so.
So don't know I'm not specifically aware that they bought a CDP.

Scot:
[14:37] Do this is disrupted in the CDP world because if you already have a salesperson you get this for free then you're going to.

Jason:
[14:44] I think if you're a.

Scot:
[14:45] Buy another city.

Jason:
[14:46] Has has like you know very much data in the Salesforce Cloud it's it's definitely going to be a much tougher sell for anyone else and you know I would say a lot of people that have had a lot of trouble getting.
The anticipated return or value out of it right like they you know the IT department to love to move around all this data and buy all these new tools that they often don't have buying from the business users in the office.
Don't don't change their marketing activities based on having these new tools and so you don't get a very good Roi and.
Because Salesforce has a lot of the marketing tools.
Yeah I think they have a better chance to be successful and I think it's going to mostly go head-to-head with Adobe that you know also has a very robust marketing stack and has their own CDP,
but yeah I'm sure the rest of the CDP vendors would rather a Salesforce have not gotten into this place.

Scot:
[15:41] And then if I remember from our deep dive on personalization that's kind of the heart of personalization alive times has this CDP thing.

Jason:
[15:49] Exactly in Encino sales force has a lot of person with Asian features they have a pretty robust a eye capability the day they have Brandon Einstein and so,
kind of one of the cool things about the cloud is like you do do this mate data mapping you plug better data into it and all the recommendation tools you have and they iTunes you have.
Just start working better without really having to do any new implementations or anything else which is to me pretty cool kind of like when you get up in the morning and your test was faster.

[16:21] And then add some more.

[16:23] Some other product announcements I mention Einstein a couple of times that big Einstein announcement is that they there beta testing Einstein voice so this is a natural language processing engine for all the sales for school,
and so that they use case they damn it is you know you're in.
In a sales meeting with a customer and you walked out of the meeting and now you kind of dictate your notes into the Salesforce app you just using natural language and you know Salesforce logs at contact in the CRA,
you don't create the forecast if that's appropriate their you know all those kinds of things they did a couple other use cases that are kind of cool where.
It can listen to the sales calls on the phone and listen to customer service calls on the phone and,
either do kind of post call analysis and recommend different things to the salesperson than what they actually did you know based on its artificial intelligence,
when the case of the customer service module it can be calling up like knowledge articles in and and helpful resolution to a problem just while it's listening to the,
the customer service person talk to the customer so voice.
That seemed a little less like live in a little more kind of this is the early version.

[17:45] And then they now have some partnership well I guess those first ones not a partnership Salesforce about Tableau last year which is a big.

[17:55] Data visualization data analytics tool.
Today announced that the full integration of Tableau and Salesforce so now your Salesforce customer you get the whole Tableau capability set to use against your data for free so that's kind of cool.
Is Salesforce a much better fate of visualization and analytics capability and then they announce Partnerships with three other companies so they announce the apartment or they,
renew to partnership with apple the announces partnership a few years ago and this mostly takes the form of they launched on the sales force apps to run on iOS and so they have a.
Pretty robust.
Interface for all their tools that runs on iOS and and that's where they demoed Einstein voice is Kentucky into that app and stuff that was kind of cool.
They announced a partnership with Amazon and I would call this one the least interesting they.

[18:52] Have made a version of their customer service module stand alone and they're selling it as a as an app on AWS sojourn AWS customer you can turn on this.
Customer success portal from Salesforce they announced that some of that Einstein voice stuff that we just talked about is available in beta on the Alexa devices.
I'm so you potentially could dictate yourselves notes into an Alexa instead of in your phone.
And they announce some training material that sells horse has a big warning portal and they announce the AWS training is is now available on the Michelle Sports training for so a pedestrian stuff there I would say,
and then the last announcement which was a little surprising to me was a partnership with Microsoft.
And the the biggest component of this is that they're moving the whole marketing Cloud to Microsoft Azure so this is to my knowledge the first time Salesforce is kind of formally picked.
A public Cloud to host their Solutions on I think you're the for like most of the apps that run on Salesforce his own cloud so interesting and I'm sure a big win for Microsoft.

Scot:
[20:03] The so I guess that won't really be back customers just got like the back ends where it says.

Jason:
[20:10] Yeah I know it's Maura inside baseball thing like I'm sure you know if your Google Cloud platform you're upset and I you know I almost feel like the AWS announcements might have been to kind of soften the blow that they didn't pick it up.

Scot:
[20:24] Brickell the other big event that has happened since our last podcast that were recovered news is singles day did you track a I had to be at a fleet conference so I was not able to track lost a very close see did you see how that one.

Jason:
[20:38] I did I kept an eye on it it's it's almost gone so mature that it like personally I'll say it's like slightly less exciting for me.
Then it was four years ago when we started this podcast for example but not shockingly they had another big year so,
total sales for the day we're 38.38 billion dollars in US so that's a.
Huge number that's more than six times bigger than the biggest e-commerce stay in North America.
The scales just amazing and they're all these ridiculous stats about how many orders they take in the first minute in the first hour and all that stuff by partly because.
Bape resell all the sales for so much that customers have chewed up a lot of purchases and they log on the first or second of the sale and click by,
to my knowledge alibaba's never had any major infrastructure problems with this day which is like super impressive to me,
is this feels like one of the biggest stress test of it and a delivery infrastructure in the world then it seems like they nail it every year.
The one thing I would say so that that 30 billion dollars represents 26% year-over-year growth which is where the first time ever a deceleration in the rate of growth.

[21:56] So you know the day might be kind of maturing a little bit the thing I go in a single day looking for most is if there's any evidence that there.

[22:06] Expanding their International reach so single day like definitely.
A place to a broader audience than just China but it tends to live primarily in Asia and there's some you know Western retailers that try to piggyback on it but but Alibaba themselves you know their main pushes get Western brands,
on the platform selling to Asia for singles day not get Western consumer shopping on Singles day.
And I would say like I saw less evidence this year than I had in the past that they were even sort of leaning in that direction,
but it's definitely true that you know Western Brands tend to be amongst the biggest Sellers and fastest runners,
on Singles day like it was a mix this year so they were like 15 brands that did over a billion one,
in sales and that was like Chinese companies like way way,
a Japanese company like Fast retailing that owns Uniqlo and then you know it's apple and Nike so,
kind of a good mix food supplements are actually the biggest category so you know it's a lot of people buying like like gourmet food and nutritional supplements.
Mostly imported products and then Cosmetics makeup Beauty are the second biggest category in her quite huge.

[23:30] And then you know stuff like and Mike are like diapers do well to so so good day all around.

[23:39] It felt like generally continuations of trends that we seen in the past rather than something while be different this year.

Scot:
[23:45] Used to be on Amazon would be up on that list as well have I wonder if they had a good singles day and I didn't see anything about.

Jason:
[23:52] I didn't see them referenced and you know singles Day falls on Veterans Day in the US and obviously you know it's a.
Short. Of time before Thanksgiving and this year because.
You know there are fewer days between Thanksgiving and Christmas like a lot of people started their Thanksgiving promotions earlier so you know it all together.

Scot:
[24:18] Yeah Google when did Jason Scott show without some Amazon news.

Jason:
[24:22] Amazon news new your margin is there opportunity.

Scot:
[24:36] Big amazon news that we want a report on is
discovernursing so on the 13th of November not called this kind of the holiday punch in the news Nike pretty publicly announced that they are going to suspend that
pilot program where they were selling Direct on Amazon there's a lot of this started this in 2017 there's a lot of speculation that so John Donahoe who was CEO of eBay and then went to,
assassin company for a while and then it now has become CEO of Nike he had something to do with this obviously not a huge Amazon fan
so that was pretty interesting Jason what it what did you make of that one.

Jason:
[25:20] Well there's a lot of speculation I Channelview the speculation that like when Nike started this pilot in there in 2017 I think it was,
did it wasn't necessarily an effort to sell a ton of product on Amazon and Nike sort of felt like they had to be on Amazon for their customers the speculation was,
did they wanted more leverage over Amazon to help and get Amazon to cooperate with sort of anti counterfeit anti gray marketing.
And so you know a lot of us think that they they put
a limited assortment of Nike products and certainly not the like poppy are new releases on Amazon in order to have a more formal business relationship with Amazon to achieve some of these softer goals
and you don't now the inference is that didn't work very well or Donahue felt like it wasn't worth it or or you know whatever the case is but it,
doesn't it never seemed like it was a full court press to create an amazing Amazon Nike brand experience on Amazon.
I still like I think it's interesting I think it definitely gives cover to a lot of other brands that are on the fence about whether they should be on Amazon or not like I definitely think when Amazon Nike moved on there.
It made it harder for other brands to say like we don't think that's right for our brands,
and now like I think it did they're not on there I think it makes it easier for other brands that make that say move what it what do you think about that.

Scot:
[26:48] Yeah Yeah lyrics and see what how other brands react
part of I think what Nike was thinking when they did this was they could control part of this was simultaneously Amazon put the clamps on people selling Nike products and if so
I haven't heard anything but I'll be interesting to see if those,
yo come off as well and then so will happen is this product will still be on on Amazon but just did the third-party Marketplace and argue,
Amazon Prime makes more money that way anyway so I think Amazon will be okay I wouldn't I wouldn't cry for an hour don't stay up all night worrying about Amazon Chase.

Jason:
[27:28] I was not going to but you actually reminded me of another day point I actually heard some rumors that in the run-up to this that Nike may have been.
Actively soliciting some of their authorized dealers to be comforted party sellers so like Nike may have even decided to help make sure that the.
The product stayed on the platform when they pulled off the one piece sales.
And I would just add one another thing that's a little more about Nike than Amazon but the to me.
Nike being on Amazon was kind of counterintuitive because the same time they announced this pilot they announce this big initiative to cut way back on the number of wholesalers that they had,
in the premise was we only want to work with retailers that have a really differentiated customer experience otherwise we would just rather sell the rest.

[28:19] And so they literally had like 30,000 businesses that were selling Nike shoes and allegedly they tried to cut that down to 40 in these forty all had to kind of commit to have an enhanced Nike experience so think of like,
Nordstrom with a Nike shop and shop for things like that,
so to be kind of a commodity on Amazon at the same time you making that other shift kind of fell in kangaroo it is and they really had a lot of success with that initiative so,
in 2013 so while ago 19% of their sales were direct-to-consumer today 30% of their cells are directions to consumer in it it's a that's a big number and Nikes case so that's pretty successful.

[29:02] They're like 35% of their their their online sales are growing at 35% same-store sales growth like 6% so like most of the growth is coming from,
their online direct to Consumer which is super interesting and I talked a lot about Nike being really good at digital in-store and doing a lot of really smart things,
in their house of Innovations and their Nike towns and the one bit of news I didn't get to cover when it happened but that I think is super interesting is,
Nike has this really good app that lets you kind of specify shoes you want to try on and in a Nike store of the shoes get delivered to a locker and you can try them on and buy them without ever having to talk to a Nike salesperson there now.
Piloting that capability in Foot Locker stores so you walk into a Foot Locker in the upper east side of Manhattan and you can.
Use the Nike Plus app to try to win merchandise and Foot Locker store you can order merchandise and it gets delivered to a Nike Locker inside the Foot Locker store it's a,
it's super smart and interesting for Nike it was shocking to me for Foot Locker because it essentially means that Footlocker is encouraging.
Customers to use the Nike app in Footlocker and you know like that doesn't help their Adidas sales very much so it was it that was it.
An interesting thing that I've never seen before where a brand had a successfully done a takeover of the in-store digital experience of a retailer.

Scot:
[30:32] Yeah yeah must be complicated to manage all these different brand experiences at some point.

Jason:
[30:36] And then one other like so I started with an irony of and I'll finish with an irony this announcement that they're pulling off of Amazon happened two days after single day and of course Nike is one of the biggest presences and is all in on,
I'm single day so that you know they one of those 40 retailers definitely is Ali Baba.

Scot:
[30:56] One of the R9 listeners were one of the kind of previous holiday punches in the nose that Amazon received was from Toys R Us so we'll see how this goes for Nike.
Never a good idea to kind of flip your nose in Amazon so maybe we'll see some amazonbasics shoes with swoosh like things on them.

Jason:
[31:18] Yep. Be interesting.

Scot:
[31:19] Another quick Amazon one they did announce that they are going to start a week of Black Friday deals on the 22nd so they're they're going to have a week of
Black Friday deals so it'll be interesting to see the kind of settled on on this deal format with a good kind of a combo of
it got the gold box it got some Lightning Deals at the other day and then they wrote a bunch of that stuff in the past experiment was video and whatnot.
I'll be watching on the 22nd just going to get a flavor for is there some new kind of platform at the deals as a kickoff Black Friday deals.

Jason:
[31:57] Yeah yeah I'm watching it in a we talked a little bit about this but the you know they also publish their physical toy catalog and one of the things they did a really good job this year and the toy catalog is.
Digital integration in the paper catalog in it and sort of quick to buy capability and so.
I thought that was really smart and then I noticed that the Walmart toy catalog holiday catalog just came out and is the first time Walmart has implemented that capability as well so that seems like the new the new standard and catalogs as you finally have to.
You don't make your catalog digital friendly.

Scot:
[32:33] The any other Amazon news before we go on to Walmart earnings.

Jason:
[32:40] Just too quick to bits on grocery so we've talked about the fact that Walmart or Amazon has some real estate in Los Angeles and that and that they intend to open in grocery stores in Los Angeles.
They they responded to some press inquiries last week,
and in one of the one of the questions was are these stores going to be Jay Watts stores just walk out store so will they will they use Amazon go in this La Market in these much bigger grocery stores and Amazon said no so,
that was kind of a definitive answer that you have these grocery stores aren't going to be bigger go stores and of course all the speculation is that they're going to be.
Lower price of grocery stores like Target in a broader audience.

[33:26] So we're all going to be eager to see when in January these doors open and I'll sure make a truck out to LA.
Take it out of the winter and do some shopping in the new Amazon grocery concept but then there was an article that came out this week that although they're not using,
Amazon go in this La Market concept that they're opening,
Amazon did admit that they have a dark store at private store that they don't you know what let test customers and employees into in Seattle this a 20,000 square foot grocery store,
that is using the Amazon Go technology so they apparently are pressure testing and stress testing,
the the Amazon Go technology for a bigger form factor store which is interesting and in that same article they also acknowledge that they're actively talking to several retailers,
about attentively licensing the technology and one of the ideas was apparently Amazon has productized kind of a small kiosk version of The Go technology.
That you might use it like an airport or a hotel lobby and that a sibo which is a sort of a gourmet food and convenience store concept it's in a lot of airports.
Was apparently named as a potential licensee for that so give me interesting stuff to watch.

Scot:
[34:50] Record then we have a couple earnings to report on super stuff is Walmart.

Jason:
[34:56] And not shocking but they they had a good earnings call so Revenue was up 3.3% same-store sales in the US were up 6.6% so
the US is doing better than International for them econ was up 41% so that's right in the range that they've been.

[35:16] Announcing a recorder they've been kind of bouncing around between 39 and 45 per cent they promised that for the year that be up 40% so 41%,
feels good and Doug mcmillon acknowledged that the bulk of that gross in e-commerce is Grocery and specifically grocery pick-up and and he did kind of,
talk about the the elephant in the room on that that that growth is not particularly profitable and you know one of the goals for Walmart is that they need to do a much better job of.
Selling more stuff to those those grocery customers to make the sales more profitable and so what's interesting about that is the aov,
on grocery pick-up is already higher like twice as high as the it'll be in the store but what isn't happening in grocery is you're not adding any general merchandise to that order,
and though that's you know one of the big challenges that that Doug mcmillon talked about is they got to turn online grocery customers into overall Walmart customers.
And you know we were at the moment there's a separate app that you use to buy groceries then there is to buy general merchandise and so you know.

[36:29] They call that the gold and blue app and don't be surprised if you see,
the feature set of those two apps kind of merge in order to affect the School of the Dead was talking about but it is interesting to me either.
1400 their stores now do grocery delivery $3,000 stores now do grocery pickup,
again they have about 4,000 stores in the US so they can expand for another quarter and a thousand more stores and keep having this kind of growth,
you know is very likely that growth is going to slow down once they get to 4000 stores that are all doing grocery pick-up and delivery and then it's going to be really critical that they,
change the customer Behavior or their other cops are going to be really challenging and then kind of related to the
earnings announcement they did introduce their new CEO for the us so that used to be a CEO named Greg foran he left to become the president of New Zealand airlines he's a native New Zealander so,
best way to drag and they promoted John firmer who was the former CEO of Sam's Club to be the president of the u.s.
So he's a longtime Walmart guy but he's a really young guy so.

[37:42] Congrats and it's going to be interesting to see how he does it Walmart and then they back filled his job with Katherine Maclay who used to run Neighborhood Market so that's.
The stand-alone Walmart grocery concept and so she steps up to become the CEO of Sam's Club so some some internal matriculation happening it at,
at Walmart.

Scot:
[38:05] Sunmark Lori reports right to McMillan right so would does he is eCommerce, cross-section so the u.s. guide actually just run stores in the Commerce a separate how does that.

Jason:
[38:19] Yeah yeah so there's two presidents of the US there's there's the president of stores which it was dragging now John and there's the president of digital which is Mark they both report to the CEO.
At Walmart which is Doug mcmillon and the like there's a chief customer officer,
that's kind of above marketing and she reports to both of them so she coming to you don't have to report that to the digital and the stores.
And you know I think some of the old articles from last year about Walmart we're about like some sort of friction between the store guy in the digital guy in the fact that you know.
A lot of the digital growth was actually being delivered by the stores with this online grocery pick-up and that you know Mark was kind of getting credit for it but it was probably,
the store guide doing most of the work so it'll be interesting.
John's a little younger than Greg you know I think it's a fair assumption that he's a little more.
Digitally native then dragged was and so it'll be interesting to see if he has a different relationship with Mark and Greg.

Scot:
[39:25] Selena on the heels of that we had Target earnings and this is what in the world of all straight we effectively call a beat and raised so this is really well-received by Wall Street,
so the beat part expectations was EPS of a dollar 19 came in well north of that at a dollar 36 and then they bumped up
the guidance at Wall Street was expecting 592 620 on the revenue side and they came in at 6:45 to 6:45 so they kind of move the range of guidance up above all she was acting self
shares were up pretty sharply I saw,
thanks to this so that was good and then there was a e-commerce was up 31%.
Gets me back to this question we should we talk about Pride like every 10 shows or so if everyone's e-commerce is growing north of 30%,
these are big companies so Amazon's at like 25 Walmart we have at 41 Target here at 31 how on Earth,
even like Shopify is growing forget their number but it's it's like 30% I think last time I saw GMB wise.

[40:40] Then we have e-commerce growing at 15% I I.
I don't know how that works something something has to be like a negative growth even eBay is like just flat so it's not going to really be a negative trim there so I can look inclusion e-commerce is either going faster than we think it is or,
or there's some peace some dark matter in there that we don't have any visibility on that
I'd like to me but I digress did you see anything interesting in the Target earnings date they
the talk a lot about ship-from-store some sure you if you were interested in that.

Jason:
[41:13] Yep yeah that was super interesting that we talked about it before but my answer to your conundrum below is that e-commerce is growing faster than we think,
and the problem is like all of these these,
companies that come out and say e-commerce is growing at 15% of index there their forecast of the US Department of Commerce data in the US Department of Commerce data is flawed for,
Ecommerce particularly for omni-channel e-commerce and so when Walmart says they grow 41% and that's mostly people going to pick up groceries at the curb the US Department of Commerce counts that is best for sale so that's part of your bra.
But in any case yeah the target announcement was super interesting to me for some of the granular data they shared about their curbside pickup so first of all they said hey we grew 31%,
80% of that gross was pickup in-store orders.
So so that the that you know they bought this company ship they they really enhance their curbside pickup capabilities they do deliveries from store and they do they actually
built with all male rooms in the back of all their stores and they do ship from store and so.

[42:27] That store inventory is being used for 80% of their digital growth which is huge and then most interesting is that they said that when a customer comes to the store to pick up an order so we don't have to ship it to the customer.
That takes 80% out of our cost or 90% rather out of our costs 08,
curbside pickup order Casas 10% of what a ship to home order cost us and when we get a ship the homeowner and we can ship it from a store.
That cost that's 40% cheaper than ship from a fulfillment center and so,
the you know a debate has always been like Ashley stores aren't going to be as efficient at picking and shipping as a fulfillment center so you know the unit economics could arguably be worse the pic and chip,
and then the counter argument is but your shipping in a way shorter distance because the inventory is already a lot closer to the customer and so the shipping cost should be well or and you know people debated about whether that netted a positive or negative for the retailer and what Target is saying as.
Man we can ship something from the store that I get there faster to the customer and it says it's a bunch of money and we can get the customer to come to us and pick it up it saves us,
a boatload of money and that's what most of our customers are doing so.

[43:46] To me that's super encouraging for Target and it's fascinating and it really high like me.
The difference between the Walmart and Target strategy.

[43:59] So one problem with all the ship from store and pick up in store stuff is you can only sell the inventory you have in the store right,
is a target's got 65,000 skews in the store and soda Target digital strategy is to sell those 65,000 skus,
either Walmart you had like 200,000 skews in the store
but you're trying to compete with Amazon for the total wallet share and you're trying to sell tens of millions or hundreds of millions of skews and throat you know Walmart is totally leaned into building more fulfillment centers in developing a Marketplace,
and that that kind of thing to sort of get there their catalog up to be you know competitive with Amazon and they're making progress and doing that,
but it really makes the unit economics challenging for Walmart whereas Target is selling a much more constrained,
catalog but they're actually able to do that profitably you know it's kind of not sure once Reggie's right or wrong but it feels like,
Walmart is trying to hit a homerun and compete with Amazon and Target is trying to head a sort of a single or a double and you know being more successful at doing.

Scot:
[45:09] The one thing that doesn't add up for me so the store has 65,000 items Target's website has I would imagine orders of magnitude more than that right.

Jason:
[45:21] Maybe a order of magnitude more they have more but it's not their target does not have millions of products.

Scot:
[45:27] That's what's to say it's a hundred.

Jason:
[45:30] Yeah could be two hundred thousand.

Scot:
[45:32] Yeah but what's a 200000 the chances are.
Yeah that the thing you order online is not going to be in the store so do they know are they pushing people to order things in the store and some way like the top of search results.
How are they or just happens to be the head of the distribution curve and that's kind of the 80/20 rule.

Jason:
[45:54] So I do I think it's partly that that 80/20 rule but I do think target is more actively merchandising the in-store assortment in are you know,
then there are some other retailers and you know it is I think it's two because they have a.
Metronidazole a lot of items but and I don't know this for a fact but I would bet you anything did the percentage of customers on target,
Define products through the guided navigation is much higher,
then the percentage of people that find products through the guided navigation on Amazon or Walmart like the Walmart and Amazon assortments are so big
The Galley navigation is use very little and almost everybody has to find things through search but Target is so much more known for curation,
a lot more with target cells are their own Brands brands that are exclusively available through Target.
And like I do think they have like a more chill rated taxonomy that's more friendly to shopping and so,
you know part part of this is a self-fulfilling prophecy is that you know more people are clicking through the menus they're saying the first page of that menu result they're buying stuff that's all stuff that's in the store.
I think that's literally the target strategy and it's kind of opposite of the Amazon Walmart strategy.

Scot:
[47:14] And then a couple Acquisitions to talk about the first one that I think shocked both of us PayPal acquired honey-honey is a
well, browser extension so it sits there you install it into your Chrome or your Safari or your Internet Explorer,
messenger name that always forget and you know what kind of watch is your shopping behavior and if it sees you throw something in your cart somewhere it will go and try to find a lower price so essentially just like.

[47:43] Scot Anderson there's tons of these out there none of them have got no attraction but for some reason honey is done a really good job with marketing and and seems to have a pretty good user base
the thing that shocking about this one is a couple things first of all the price tag of four billion dollars this is asbestos,
we've seen reported this 200 billion dollar Revenue company just got a 20 x multiple so that's just me there was some kind of a bidding war hear the other thing I wonder how PayPal navigated is
I would imagine so if you think of
Amazon having 50% of e-commerce it's probably 50% of the honey I'm activity or more is on Amazon.

[48:28] My understanding is there some kind of an affiliate relationship they're so so Amazon hasn't black honey but now that it has a new owner I'm Amazon
you know do I really want it your PayPal owning this there's going to be some,
preference PayPal payments Amazon doesn't take PayPal,
yell at my say something happens and they are in Amazon turns off honey which which is very viable yeah you can look at the IP in and just shut the
crawlers down that they have you know that thing has huge exposure from getting an award Amazon so I hope PayPal is thoughts through that and,
got some somewhere around that challenged his communication to see what happens to that one.

Jason:
[49:13] Yeah and I can try to shut them down they can make it way harder for honey but like there are companies that successfully still.
Do stuff with Amazon even though Amazon doesn't want them to I'm not saying that's the position you want to be in but I'm not sure it would completely exclude on that would just make it much harder if Amazon. Active it at preventing it,
but I think they might have a broader version of that problem you know Visa V PayPal in that like I I don't know that much about honey but I imagine that the retailers have a love-hate relationship with him if,
you're not a honey partner and people are shopping on your site and honey is trying to divert those customers to a site that is a honey partner,
you don't like honey very much right so if your target you're not paying honey and when you you know try to buy stuff on On Target it's saying like hey there's this other retailer that has a lower price,
or you know honey you says like hey they have a promo code over here these kinds of things.
You have the potential to to alienate a bunch of retailers and those are the same retailers that PayPal is trying to get to a doctor platform,
so it is possible that they're going to have some customer conflict here don't don't know enough to know that for sure yet but but it's going to be interesting to see how it all plays out and improve your point.
I sure hope PayPal thought through that when they paid for billion dollars for me.

Scot:
[50:43] Yeah we should probably rename this segment Scott and Jason are super jealous or why didn't we think of that so it so number one congrats.
Short forgetting this exit and then the other one that was kind of mind-blowing was Kylie Jenner she started a makeup company and you know obviously she's she in her hole
Kardashian Clan there are a really big influencers this has blown up
2 / 200 million in Revenue very quickly and she sold half the business to
the large conglomerate in the beauty category called Cody for 600 million which is effectively gives that a 1.2 billion dollar valuation in the real mind-blower
is the company has six employees.

Jason:
[51:29] Yeah that Revenue per employee works out to be pretty good huh.

Scot:
[51:32] Yeah I have a feeling Kylie may take a disproportionate amount of that but we don't.

Jason:
[51:40] Yeah I know it's that super anything in that I mean it's a nuanced but I think Cody actually bought 51% so that's that a controlling interest.
Which is somewhat interesting like I wonder if that will in any way put off Kylie Jenner fans but I mean mad props to her like I think she's actually totally changed the way influencers think about monetizing,
their popularity comes before this they all would take money to,
sell other people's stuff and this model has been so successful that you now see a lot of other popular influencer saying hey.
I'm not going to promote someone else's product. No launch my own products and so there there's a lot of lot of folks trying to follow in her footsteps but this is a.
You know what that huge home run and congrats Shopify by the way cuz that's this probably the biggest biggest retailer on the shop.

Scot:
[52:33] Yep
and it's also important to point out that this is also a DMV be kind kind of a strategy here so imagine
fairly large percentage of her sales are from her website and then she does I think she does sell thru I always get
it could use which one but she's in either Sephora or Ulta.

Jason:
[52:55] Yep and I think she started out online only and then only in the last year has she added the the wholesale distribution but so yeah for sure.

Scot:
[53:06] So Jason and I have a big announcement we are starting the Jason and Scott beauty company and we're going to come out with a palette for Holiday 2020 so stay to.

Jason:
[53:16] Yep yeah we're not to upgrade the servers for the mass influx of traffic we get for that but
looking forward to it and it will include a browser plug-in which will help you buy a product instead of anyone else's product on the web so we're kind of think of it is,
honey + Kylie Jenner.

Scot:
[53:35] Yep we'll just call it Scott and Jason honey or something like that we're still working on the brand.

Jason:
[53:40] Exactly send your suggestions to Scott,
and sadly that's going to be we're going to have to leave it cuz we have used up all our a lot of time as always if you have any questions or comments you have to hit us up on Twitter or Facebook page
and I please please please this is a great time for holidays to give us that special gift and go to iTunes and give us that five star review the the reviews key
keep coming but we we want and need more and we really appreciate it.

Scot:
[54:10] Thanks everyone we're probably stay tuned for episode 200 you're going to love it.

Jason:
[54:18] Yeah absolutely that's going to be fun next week and until then Happy commercing.

Nov 12, 2019

EP198 - Holiday Forecasts

 

A weekly podcast with the latest e-commerce news and events. Episode 198 covers the 2019 holiday forecasts, store visits, and news.

Reviews

Jason & Scot both received the new Apple AirPods Pro and the Amazon Echo Buds.  Both liked the Apple product better.  Echo buds had better noise cancelation, but an inferior fit/design, poor microphone, and a case that’s too big for a pocket.

Trip Reports

  • Nordstrom NYC Flagship
  • Amazon Bookstore remodels and FourStar
  • Showfields
  • Macy’s new Story display 
  • Starbucks Pickup Only location

News

Holiday Forecasts

NRF

Nov-Dec excludes automobile dealers, gasoline stations and restaurant

3.8% – 4.2% over 2018 to a total of between $727.9 billion and $730.7 billion (vs 2.1% last year, or 3.7% last 5 years).

AlixPartners

November-January

Total Retail increase of 4.4% to 5.3% 

Deloitte:

November – January

Total sales are expected to exceed $1.1 trillion 

Total Retail 4.5% to 5% rise in 2019 (vs. 3.1% last year)

Digital $144-$149B 14-18% growth (up from 11.2% in 2018)

Kantar

Oct-Dec

Total Retail 3.8% (vs. 3.1% last year)

Online 14% vs 10.8% last year

Salesforce

November 1 to December 31

Digital revenue growth this holiday season at 13% YoY to 4136B

Hub: https://www.salesforce.com/solutions/industries/retail/holiday-insights

Adobe

Nov-Dec

14.1% increase online (totaling $143.7B)

MetaForecast (summary of the forecasts):

14.25% Online  (range is 13-18%) 

4.35% Total Retail (range is 3.7% – 5.3%) – last yr was 2.1%

Don’t forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.

Episode 196 of the Jason & Scot show was recorded on Thursday November 7th, 2019.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott show this is episode 198 being recorded on Thursday November 7th 2019 I’m your host Jason retailgeek Goldberg and as usual I’m here with your Cup host Scott Wingo.

Scot:
[0:39] Hey Jason and welcome back Jason Scott show listeners Jason Ritter episode 198 and we have a really big surprise for everyone on episode 200 I’m giddy all over with excitement.

Jason:
[0:51] I know I am to every each time I say one of those big numbers in the intro I’m like oh my God we’re going to have to learn how to start saying the twos it’s like our Y2K day.

Scot:
[1:01] For those listeners that haven’t seen Jason give a life talk he always talks about how if you enjoy the talk there’s over X hours of him out on the internet,
pretty soon you can build a role that part of your side over to 200.

Jason:
[1:17] I know it turns out I’ve been lying cuz I generally like round up to 200 hours in those live talks and in preparation for our big 200 anniversary show I did the math and it’s actually like 176 hours of us.

Scot:
[1:31] Close enough we’ll get there eventually keep plugging away.

Jason:
[1:36] Yeah we might tonight who knows.

Scot:
[1:43] Anyway so Thanksgiving is only three weeks away so we thought
we would spend a fair amount of this episode looking at the Holiday forecast but before we do I’ll be Gadget Geeks we wanted to talk a little bit about that first so you and I both had the fortune to get the latest new
Wireless
your devices so airpod pros and Echo buds came out and everyone on Twitter was wondering how your
experience with both of us went so so give us your review.

Jason:
[2:18] Yeah so I was super excited they both ride the same day I don’t know if Amazon like stepped on the gas to make that happen or or maybe Apple did but that was coincidental so I have to say,
that I like the airpod pros better than the echo buds for almost everything and somewhat disappointingly.
On my use case which I mainly use these things as my phone interface for being on conference calls like 8 hours a day.
I’m not sure that either one of them are better than the original airpods.

Scot:
[2:53] Controversial so you don’t like the noise cancelling of the air pump.

Jason:
[2:59] Well so couple of things and I I literally did a test and I even I recorded some audio files so one thing when you’re using it as a phone interface I don’t like to wear both.
Are you positive same time.

Scot:
[3:14] You’re that one of your guy.

Jason:
[3:15] Because I do want to hear I sent you have unlimited battery life because I can have one in for two hours while the other one is charging in the case,
pop the the charged one in take the uncharged one out and I can literally like I literally have these a tower block swear I’m just on the phone.
And any of these products work for that when you only wear one at a time but none of them do noise cancellation when you only have one ear in SoDo for phone use noise cancellation doesn’t work,
I do occasionally listen to music and to me the airpod pros sound much better than the echo buds.
But I did test both of their noise cancellation and that the echo Beds which have Bose technology in them definitely have stronger noise-cancellation they they eliminate more background noise than the airpod pros.

Scot:
[4:08] So one idea to solve your 11.1 ear problem is just to get two sets you up I have,
12 of these things at this point so why not just put both in and then recharge and then switch every 2 hours.

Jason:
[4:25] That’s what the dirty secret of my family is left to my own devices I would have way too many sets but I can’t off setting that my wife is very Adept at losing them.
So it’s one of the rare things we’re like like my strength balance is out or weakness within most of everything else that’s the office.

Scot:
[4:41] So your sets go to backfill her lost sets.

Jason:
[4:44] It does seem that way,
but I do I feel like the airpods are more comfortable.
The echo beds like are more in your ear and they it just feels like a big thing in your ear I mean if it’s going to be kind of personal to everyone but I tested the microphone cuz I was curious,
which one sounded better in the airpod pros are basically the same as the airpods on the microphone which,
is a pretty good microphone and it does a decent job of eliminating background noise and it does a really good job surprisingly of eliminating wind noise,
the echo buds that there’s no stems of the microphone is in your ear and not surprisingly it sounds much worse.
Just a tinge of closer your mouth is helpful but the roads are horrible in the wind like almost unusable.

Scot:
[5:39] Which verse Chicago I’d seems important.

Jason:
[5:42] Yeah yeah I am sometimes on my way to Starbucks while I’m doing these call so that and as you know I’m quite Speedy so I create a lot of wind just walking.

Scot:
[5:50] You’re like the flash down there that’s the problem.

Jason:
[5:56] But I will say.
It is mildly cool in my house having the echo buds because I have so much of this novelty home automation around my house,
that way this thing in your ear like just being able to like very quietly other anywhere in the house like you know to do something and have it happen does give you none of us Tony Stark.

Scot:
[6:17] Yeah I was kind of a little depressed by that go buds cuz they do feel like having a giant,
ball of wax in your ears or something in there that feels heavy and like you don’t want to move your head around and I’ll pop out these wings but I just didn’t I think I lost some II I open the package and then you know,
I was I’ve been predicting that it would be awesome to have Alexa in your ear like that,
but then I’m in an open Office so and it’s good news canceling so I’m sitting there screaming Alexa play this,
it’s actually can’t raise it that much it is good for exercise though if you wanted me to get Alexa to play a certain song or something or skip or whatever drink exercise so I found it but then like exercising and moving around alot
they don’t feel good so they didn’t live up to my expectations.

Jason:
[7:07] No I agree I was underwhelmed and to be honest I kind of just qualified on the second I opened the box because the case is too big.

Scot:
[7:16] It’s like a bar soap.

Jason:
[7:18] Yeah I mean I carry these things in my pocket all the time and the echo buds case just wouldn’t fit in my my pocket.
But that being said on the last show I did reference that I was installing a new Gadget which is Echo control for my kitchen sink.
And I have now successfully installed that and as predicted like nobody needs this.
It’s it’s no easier to just turn on and off your water than it is to tell Echo to turn on and off your water but I will say there were two things that use cases that I didn’t consider it a kind of cool like you can tell it.
Eco fill 2 cups of water.
What is exactly two cups of water which can be kind of Handy for some things and then my four year old son thinks this is the greatest thing on the planet.

Scot:
[8:11] The two cups of water or the.

Jason:
[8:12] No sitting in the kitchen turning on and off the faucet.
Yeah so what’s the new entertainment device in my house.

Scot:
[8:19] Pretty soon we’ll just lose all use of our Limbs and it’ll be like that in Wall-E where we’re just in the chairs and slurping sodas and talking into computers.

Jason:
[8:32] I’m moving one step closer to that Wally vision of future everyday.

Scot:
[8:35] Awesome thanks for the gadget updates I think you are actually in big beautiful New York City for this episode which makes me wonder in the interesting trip reports.

Jason:
[8:48] Yeah yeah I got to visit a few stores I’ve actually been in New York last week and this week and last week there was a big retail opening in New York
Nordstrom open their flagship store in New York so you know how to see Nordstrom based in Seattle they cannot expand it on the West Coast,
and they they now have you know this,
this flagship store in the heart of the retail Echo System here in Manhattan so it’s a big deal to see what that store would look like.
And while I would I would say it’s a excellent implementation of a traditional department store.

[9:26] And so you know it had a lot of a cool smart features so there was a lot of personalization options there’s a lot of places where you could,
you’re by your jeans and have them embellished like in the store,
they have alterations while you wait which is pretty cool so they have like Taylor’s on every floor and you can actually watch the tailor like hemming pants and stuff,
they had some really you know extravagant shopping shops like there’s a new a really cool Nike shop and Shop bunch of good restaurants.
Some nice digital amenities they do,
same day delivery they have a rich buy online pickup in-store experience so a lot of cool stuff but nothing that’s going to.
Revitalize the department store category I don’t think it’s going to be really interesting because it’s like this may be the best apartment store in.

[10:28] Manhattan you know where the caveat that for most people the best department store to the one who’s a storm it matches your taste the most.
But you know they’re there so many department stores in Manhattan that have this Rich brand history that Nordstrom doesn’t have your.
Like it’s going to be interesting to see if they’re able to win over consumers or not.

Scot:
[10:48] Where is it it’s not in Hudson yards.

Jason:
[10:52] No no no no so it’s very near Central Park on like Broadway and 57th in this kind of completes their New York deployment so they actually open the men’s store a couple years ago,
maybe 18 months ago and now the store is across the street from that,
so it’s a women at home is this new store men’s across the street they already have a couple Nordstrom Rack switch is there discount Concepts in New York and then they have two of these satellite stores that they call Nordstrom local,
Nordstrom local is kind of a.
A digital extension of Nordstrom you can do by my pickup in-store there you can do returns there you know it it’s a lot of omni-channel amenities they don’t have inventory there so you don’t go shopping for new stuff,
but if you want you no personal shopper to help you or you want to pick up some digital purchases or things like that that a couple of these digital.
Nurse Mobile stores in one of the clever amenities they launched in Nordstrom local,
maybe a month ago is that they would accept returns from their competitors so you can return your Macy’s purchases at this Nordstrom local.

Scot:
[12:06] How’s that work.

Jason:
[12:07] Unauthorized you return them to Nordstrom Nordstrom packages them up and drive them to Macy’s for you.

Scot:
[12:15] But then like how do they verify the cattle they avoid fraud like.

Jason:
[12:19] Yeah I haven’t gone through the experience so I think like you know he is probably like I mean.
Nordstrom isn’t crediting you the money when you drop them off like they’re just providing a minute e of packaging them in.
And you know mailing on the listen e-commerce thing or or taking to the store but like if the store doesn’t give you a credit your York of your visas going to be with Macy’s not with Nordstrom.

Scot:
[12:41] So it’s more than just to drop off not a full return.

Jason:
[12:45] Exactly it’s not like happy returns for for these competitors.

Scot:
[12:49] What else what else.

Jason:
[12:51] Yep so then I’m staying this week down in Tribeca which is very close to the Amazon 4-star store so I went back there to check it out,
I like that store more than some people like it continues to be super busy there was not a lot of new stuff going on there like you know the assortment kind of pivoted to Holiday,
and I did grab you a Nordstrom toy catalog because you I saw on Twitter that you didn’t get one so.

Scot:
[13:18] Amazon.

Jason:
[13:19] I’m sorry yeah an Amazon toy catalog so which is.

Scot:
[13:23] Awesome thanks. It has a great Star Wars section I look forward to seeing.

Jason:
[13:26] Yeah yeah I just got to figure out how to get it to you.

Scot:
[13:32] I like the 4-star store as well it’s at like a cool I bought several things in there that I didn’t know existed you know and it’s kind of cool to see them I like
dissection where they have those exclusives that are kind of like the things I’ve gotten from Kickstarter a lot of that stuff I kind of want
touch it because I’ve had so many weird bad experiences with that kind of stuff so that’s my favorite part of the store it’s got kind of a beta of kind of a feel to it and I will section.

Jason:
[13:57] Yeah no for sure and I mean my promise is always been at that store and the bookstores are sort of Trojan horses they’re really Amazon device stores,
and as the Amazon devices like the echo system gets more and more complicated pun intended,
you know what a broader assortment of Echoes and rings and you know and then all the stuff that works with them it it’s super helpful to have.
A store that sort of show the lacrosse device experiences.
And that that that reminded me so where I live in Chicago is within a mile of an Amazon bookstore and that bookstore got remodel the last month so I went back to it this weekend before I came here
and that’s pretty interesting to because the original bookstore Concepts.
Like many bookstores really tried to have kind of a third-place feel so there’s a lot of soft seating where you can kind of sit and read a book and charge your phone while you’re reading a book in the the one of my neighborhood had that Intelligentsia coffee shop.

[15:01] And the remodel what they basically did is tear out all of those.
Dwell time amenities to make more room for more Amazon devices,
and I got rid of the coffee shop they got rid of this off seeding they added a bigger Amazon device section and then you know one upgrade that maybe it’s only interesting to me but.
All of these doors try to match online and offline pricing the online pricing changes all the time so when they watch the book stores they had what I thought was a horror riff experience you couldn’t tell the price of anything and you had to scan,
everything with your phone,
in order to find out what the current price was didn’t want to have paper price tags then you know fast forward a couple years they open the sports star store and they deployed digital price tag so that they could always have a current price and so you had this weird. Where.
The four-star stores and the newest book stores at digital prices and the older bookstores had no prices and now they’re remodeling the older bookstores and not surprisingly they they did add the digital price tags.

Scot:
[16:08] You love a digital price tag.

Jason:
[16:11] Well I’ve been predicting that it’s going to be the big year of them for every year for like 4 years old.
And now I’m going to be extra stubborn because I predicted the Amazon was going to have that Echo your your phone for like 3 years and it never happened and then I finally gave up and made it so,
now I need to stick to my guns also in Tribeca is a very tight to store called showfields I think I’ve talked about it before it’s in this family of physical Marketplace at so.
The landlord raised the cool retail space brands of lease a shelf and then they sell their own products on the shelves so we’ve talked about betta is being a model of that neighborhood goods for poster,
there there’s a number of these Concepts and there’s one that’s here just here in New York I’m called showfields and they’ve been getting a lot of Buzz lately for.
Having a retail show where they put on like some retail theater and I’ve been reading about this so I want to go check it out so so I went back to the Schofield store and.
I’ve kind of decided that the the gimmick of the the retail theater is actually kind of annoying.

[17:29] So they have it it’s a three-story store you know with a bunch of PODS and The Usual Suspects of all these I Challenger brands that have rented a spot so it’s.
The eclipse,
toothbrushes and and all that sort of stuff like that there is a cool assortment of vendors in here they’re selling stuff I will I will totally give them that they’re each renting,
a space to show their product into what they’ve done is the bottom floor is kind of cell service browsing the third floor self-serving browsing and the second floor instead of having quitting sales associates they have actors,
and the idea behind these actors as they like.
They have like a canned presentation about the products in about how they use the products in their life and it it really is just like a presentation from a salesperson.
But it it’s like you walk in the store and they they confuse Everyone by going are you here to shop or go in the tour.
And it’s like well if you want to shopping in the stuff on the second floor you can’t avoid being on the tour if you want to see anything on the 1st or 3rd floor is the tourism going to help you.
So it just it seemed a little like overly gimmicky and you know God forbid you just want to look at the product on your own on the second floor like you can’t cuz this.
Desperate actor is trying to earn a sag card in a retail store.

Scot:
[18:54] There’s a I went there and it had a slide do they still have the side where you at.

Jason:
[18:58] They did.

Scot:
[18:59] Top floor income.

Jason:
[19:00] Yeah so from 3rd to 2nd you go down you can go down the slide which I’ve course did and I videoed it so look for the Twitter video of me going down the slide which I know people are super eager to see and its significance does a couple rotations in it.

Scot:
[19:13] Did you have your some of your pods and Phyllis.

Jason:
[19:16] I didn’t.

Scot:
[19:18] Could have been a good wind test.

Jason:
[19:19] Yeah yeah yeah they were in my pocket and I think both of my knees did survive the slide so that that was good news but here’s here’s what I’m going to say tool
replacements for shoelaces so they are like these permanent rubber bands you get them in any color you want in,
and then it turns anyway shoe into a slip on shoe and I’ll try that I tried to buy a pack and you can’t pay for them.
On the lake on the floor where they are.
Or at least it didn’t seem like you could like there was no salesperson to pay there’s no cash register so I go down to the ground floor and I said Hey how do I pay for these things in there like you were supposed to.
Pay for them up there there’s like one salesperson she must have been busy with someone else but no worries I can bring you up and so then it’s like.
Should I go between dollars and unlike would said they were $14 and she’s like when we call up and ask and she’s like well.
It’s $14 if you pick your own colors individually and grab 14 of them but if you buy a pack of 14 that are all one color you have to pay $20.

[20:32] So you’re saying like like if I if I go up there and just pick 14 of this exact color,
you’re only going to charge me for it if I want them in the bag I have to pay 20 and she’s like yeah I’m afraid so right and it and it was like a super awkward transaction and like,
basically I abandon my physical card and walked out without my music,
and as I’m walking out I’m thinking about it and I’m like you know why there’s so much friction in this is such a bad the buying experience it’s because the store does not have a kpi for retail sales.
Right like they’re they’re TGI’s rents.
And so that you know that they’ve optimized everything for this customer experience and and you know getting good brands to come in but you know the people haven’t thought through like actually selling things and being financially.
Lastly whenever I’m in New York City I always go to B&H Photo on like
33rd Street which is kind of my adult Disneyland and then I generally will walk to Macy’s from there and check it out,
so watch the Macy’s a block away from the Macy’s is this cool new Starbucks concept that I had been reading about that just open the day I was there called Starbucks pick up.
Inside this is a a mobile order pickup only location allegedly you can’t place an order in the store but secretly you can.

[21:54] It’s our put some pictures online but this like whole store is optimized for people that just Place their orders,
why can pick it up not get in line and place orders there’s a cash register but it’s kind of like it in the counter and you don’t see the Baristas or the.
The the expresso machines like they just have all these alphabetize counters where you you come and get your.

[22:19] I think so I think that’s going to be a New Concept the Starbucks is going to use in a lot of the highball volume order stores because.
The mobile what is in the stores are really disrupted the normal flow of the Starbucks and so this is part of their,
their solution set for that in this is a pilot so that was kind of interesting and then I did pop into the Macy’s and it was the third installment of story he just on live the day I was there,
so you know you remember story was this going to retail theater times app that,
I was in for the downtown Manhattan. By Macy’s they opened him up in a bunch of Macy’s in the first team was colors so they had,
August beautiful merchandise that was a sorted by color in the department that you know they ran that for about a month and then the second scene was Miracle glow.
It was like a lot of gardening stuff and they had some cool merchandise but you know my joke was it in this I wasn’t joking it did not smell very appetising in that department like there was a lot of live Miracle-Gro manure.

[23:26] In that department and so you know usually when you’re trying to trade a great retail experience you don’t want it to smell like manure into that went for about a month and now they’re on their third one,
which is Holiday Inn so you know this is like a good theme cuz it’s all like sort of gift face the the merchandise thing is really attractive they have a bunch of cool different than yet,
again like a big scene is personalization so there’s a number of products that you can come and get personalized.
Uniquely to you and 4 story I feel like this is a particularly strong theme because one of the challenges with all these Discovery experiences.
You know is why would people go there what mission would they have that would get solved by going there right like no one walked into Macy’s thinking I want to see what I can do with Miracle Grow.
Until I’d argue that theme didn’t have a lot of reason to go there but the holiday theme when you’re looking for gifts for people.
Things like a much stronger and more more cognizant theme so I thought that was pretty well done.

Scot:
[24:30] Yeah that’s what I’ve always been a little skeptical that but the,
my wife and daughters love that and they’ll suspend tons of time they like the discovery aspect of the the story even even inside the Macy’s so I think we did the miracle glow one in the holiday one before.

Jason:
[24:48] And to me it’s,
I think those Concepts work better when they’re inside of a store that serves other missions right so you know you need some new back-to-school clothes you going to Macy’s free back-to-school clothes and you go check out this other Discovery experience while you’re there like I think storage,
that are exclusively a discovery experience that don’t need any other Mission like it just harder to get traffic to.

Scot:
[25:11] Yep the cackle TV is stuff.

Jason:
[25:15] So that’s a lot of store visits we also do have some you know some news items this week Commerce news.

Scot:
[25:29] Yep what you fire fire sup on them.

Jason:
[25:32] That will fire is well maybe not fire but,
the the surprising news today is the CEO of Gap is stepping down so there’s a gentleman art pack,
I want two things I’ve always liked is he he was the VP of e-commerce a gap and got promoted into the the CEO role.
Gap has not been super successful during his tenure,
last year they announced this big move that they’re going to spin off Old Navy as a separate company than the rest of the Gap Brands were going to be operated is you know this new Co,
and they had an earnings call today that was not very good and then they announced that that art was stepping down.
And so you know they announced an interim CEO who happens to be the the son of the founder who’s been a board member,
but I think the intent is to go out and do a search for a new CEO.
I’m into this kind of follows to me a trend like last last year we talked about a lot of CEOs that hid it step down recently and said there’s another big one.

Scot:
[26:41] Yeah what what I don’t like about the strength as there’s no transparency so,
they’re not giving reasons for lies people in NY can that in the case of Under Armour it really was bad because Kevin plank a step down and then you know they had to announce regular days so,
because he didn’t answer why you kind of assumed you was kind of hiding it either gets like it makes it look way worse than probably maybe those actually we’re disconnected we don’t know but when when you have this lack of transparency,
makes you wonder what’s going on.

Jason:
[27:14] Yeah and I think the same story at Nike like there was great financial performance in Nike
but there was a lot of sort of negative press like around the whole Alberto Salazar thing and treatment of women Executives and treatment of female sponsored athletes like there’s a bad news and then
you know the CEO of a well-performing company in Assateague steps down and they don’t give any specific reasons like the inference is that you know he’s.
He’s accountable for a lot of those there’s missteps and then. You know it’s not sure.
Retail that the CEO of McDonald’s was let go this week for impropriety so a lot of lot of them.
Churn at the at the big chair for a lot of lot of these in a couple of cases they were you know I’m kissing McDonald’s and Nike they were financially performing very well so stock that she took a hit when those guys left.

Scot:
[28:11] Cool Indian new section filed under arm Olive Garden today Sears announced they’re going to close 96 more stores so I think that’s about a hundred and eighty stores between Sears and Kmart
so I’ll have to do is do that two more times and they’ll be done.

Jason:
[28:32] Yeah I went hopefully that you know it’s not death of a Thousand Cuts but yeah sad for all the other folks that were working in the stores but like certainly not surprising news.
In other.
Retail I get a news in a banker Barney’s had declared bankruptcy a while ago and we were waiting to see if they would be able to restructure and continue operations or they were going to get liquidated and last week it was announced,
that they were in fact going to get liquidated so basically,
all the assets of the company which is all that inventory they had in their stores got sold to a liquidation company and it’s called Great America group and Great America is now selling at a discount all of that may see all that Barney’s merchandise.
And like to be honest the a lot of people in the luxury space were really like holding their breath.
Hey hoping Barney’s wasn’t going to liquidate but if they were going to liquidate like oh my God where they can have a bunch of designer you know what jewelry Brands deeply discounted going into this holiday season was that going to have a,
a trickle-down effect on the rest of them.

[29:44] The the retail space and was you know everybody in that category going to get ticket for this and it seems like,
Great American is not sort of a quick churns cell everything in a fire sale kind of Liquidator and they you know there’s like 500.
Million dollars worth of inventory year and they want to get that value out of it and so the sales are going on right now are very superficial it’s like 5% off on all this stuff,
and I think people are kind of taking us II release that even if they subsequently have to discount from this merchandise a lot more to sell it it seems like they’re not going to just come until after holiday and so that will at least Preserve,
holiday season for some folks and side note apparently lvmh had this crazy contract this vendor agreement with Barney’s,
the in the event that that they did default that lvmh had the right to take all the merchandise back rather than have it be Wicked.
So far they have an exercise that Clause but apparently like they’re so protective of their brand that they made sure that like you know they wouldn’t have a bunch of there their stuff get deeply discounted on the market in any case.

Scot:
[30:56] It’s actually pretty smart.

Jason:
[30:57] It’s really smart I think you should think more people should do that like I think you’d have to have a lot of Leverage in order to get that kind of vendor agreement,
sign because that’s like a that’s some kind of liability that that Barney’s had to carry on the books and I don’t like it from the accounting standpoint I’m sure that was super annoyed.
And then the other half a Barney’s is this intellectual property and that got bought by this company called authentic Brands which is been going to license it to others and they’ve already announced the first licensee is going to be,
Saks Fifth Avenue order the parent company is Hudson Bay Company but so it seems like there’s going to be some Barney’s branded departments or merchandise inside of Saks Fifth Avenue in the future.

Scot:
[31:38] What are the things that happened with sacks when they get sold as their headquarters building was worth more than probably didn’t tire retailers does Barney’s have a big real estate portfolio that would be,
maybe more valuable than a bunch of these these items.

Jason:
[31:54] That is a good question so exact had a lot of real estate but that famously was this New York flagship store that was worth like a billion dollars by itself and somehow wasn’t completely valued in the acquisition like I assume some people lost their job over that,
the I don’t know what the real estate situation is with Barney’s if they own the real estate or they were Reese’s I do know that the New York store which is like they’re you know the biggest up there I think it’s 7 stores or something.
Is a going to continue operations for like a year in some like diminished capacity so it,
is there a recent doesn’t sound like there’s a piece of real estate that they’re going to be able to liquidate quickly there.
But we shall see I haven’t read about the specific Real Estate Value yet a little more.
Start a digital news Prophet Chira which is one of the data providers that we talked about on the show sometime did a pretty comprehensive fry study going in the holiday.
And I was a little surprised by the results like basically they took a big shopping cart of products and price you know a bunch of different retailers on this big shopping cart,
and divided in there like four categories of products and Amazon was the low price in all 12 categories.

Scot:
[33:15] Was I surprised.

Jason:
[33:16] Well I like despite the fact that Amazon’s really aggressive on price I actually don’t think of Amazon as fundamentally a price leader like I think of them as a,
basketball work like I don’t think they like historically I don’t feel like they’ve always tried to be the lowest price on everything. I think they have.
Watch the competition and make sure that they were competitive on everything and that they were the lowest price on some sort of Keystone items that people tend to pay attention to this,
shows that he did they change that strategy or I was wrong in thinking that was their strategy because it seems pretty clear,
that that they are the low price guys going in the holiday,
you know Walmart was closest to them and in a few categories was very close but in other categories there’s like a pretty significant Gap and then folks like Target had a pretty consistent.
Against the Amazon so it seems like this is another phase of the bifurcation where you know you have the guys that are going for big assortment and going for super low prices and almost every other retailers going for some sort of,
more curated exclusive assortment and and more moderate prices I just thought that was that was interesting I’ll put a link to the study.

[34:30] In the digital news category Shopify launched a new amenity for their platform this this week which is their own email service provider so now for the first time you can kind of,
natively run email campaign,
in the Shopify echo system before this you’d use a plug into a another ESP like MailChimp or or a cheetah male or one one of those,
and you know now shopify’s getting into that space themselves which a lot of Shopify users are super excited about because they felt like that was,
you know it’s a super important tactic for driving traffic to your store and I felt like that was sort of the weak Link in the.

[35:10] In the Shopify echo system in a back to life based on some new data privacy rights over the last couple months a lot of the other efps at Dunham’s moved away from the Shopify echo system and.
That seemed kind of surprising until you saw this announcement at the shop if I wasn’t worried about it because they knew they were going to offer their own ESP.
And the reason that’s interesting to me is you know you think about how Shopify is going to continue to evolve and people a lot of people talk about them being a potential Amazon competitor.
You want to talk about that I don’t think of them as fundamentally an Amazon competitor cuz I think Amazon’s main value-add is that is providing traffic,
Shopify doesn’t provide any traffic but I think this more much more clearly put Shopify in the,
the marketing stack technology competition set so you know competing more directly with the sales courses in the Adobes of the world.

Scot:
[36:04] Yeah.
Kind of makes you wonder so so once you kind of add to email capability then you know if you listen to customers the next thing we’re going to want is a more robust CRM right because you’re just keeping a bunch of email addresses and hitting what’s emails isn’t good enough,
you going to a segment so then the segment you’re going to want to know that Jason have a dog or a cat did he buy what did he buy from me and now you’re kind of squarely into Skyrim territory and then once you do that then,
I got an order management system their warehouse management Prime like.
The filament capabilities are interesting to see their kind of Warren Moore capito with this cloud guys.

Jason:
[36:49] Yeah I’m for sure and when she got that rich database of consumers and their preferences you don’t just want to email them you want to buy the lookalike audiences on Facebook and all those things as well so so there could be all kinds of advertising activations in that stack hit someone.

[37:05] Indian last piece of news I want to, not because I’ve been driving me nuts all week like 2 weeks ago
This research company first Insight published a study and they picked an excellent clickbait name for the study they called it Amazon past its prime.
And the the conclusions of the study are that consumers are losing interest in Amazon their preferring Amazon unless off and and in fact the majority of consumers in this study.
Prefer to do their online shopping at Walmart rather than Amazon,
I have counted no less than 50 articles written online about this,
you know different aspects of this huge trend of consumers moving away from Amazon towards Walmart.
And the reason to drive mean is because that is not a huge.
The studies of a they surveyed a thousand people and ask them where they went shopping they didn’t watch where they go shopping or look at the receipts or anything they like,
they surveyed someone in the middle of doing something else and said like what e-commerce side do you use an,
501 of the thousand people they asked set you know thought of the word Walmart before they thought of the word Amazon.

Scot:
[38:23] What’s the sub Bentonville thousand people.

Jason:
[38:26] I don’t I don’t know what the methodology and I’m going to hope that they have good Geographic diversity in there.
Obviously you know the part of the country were Walmart’s the strongest in the parts of the country were Amazon’s the strongest tend to be pretty bifurcated so,
you know if there’s any Geographic Claus but it’s only a thousand people it doesn’t even matter like it’s way too small a sample size 190 million Shoppers go to Walmart every month,
more than 10 times that amount go to Amazon every month they surveyed a thousand people like it’s not statistically significant and.
I’ve said it a million times we have tons of evidence to the fact stated preference surveys are irrelevant like customers get it wrong all the time like if I jumped in the email accounts for those thousand users.
The the amount that shopped in Amazon vs Walmart would have no correlation to what they sat like people just don’t think like that and so you know.
What kind of silly study and I was in a frankly surprised by all the journalists and analysts that like.
Just you know consumed it and took it and run with it ran with that like I I love for there to be competition for Amazon I love nothing more than for Walmart to be kicking Amazon’s but like,
the survey is certainly not evidence that they are.

Scot:
[39:43] Yucca Dental graphic up and it’s just simply every little part of the infographic is wrong based on Amazon’s results,
it says Amazon Prime membership is dropping and it shows low chart that used to be 60% and now it’s like 52%.
All those measures are wrong like frequency is down you know the frequency measure at Amazon is paid items and
at its fastest quarter last quarter if you listen to our last episode in a year so all this is this is a,
very bad survey to scratch your head.

Jason:
[40:27] Yeah and again I don’t blame someone for doing some some cheesy content marketing tickets in traffic I’m I don’t like it but it it happens all the time I’m more disappointed by all the like to me more credible people that.
That like sided all you have to do is listen to podcast once a week and you’ll save yourself some embarrassment.
So should we finally get to what the audience is just really been waiting for.

Scot:
[40:56] Yeah let’s talk about the holiday.

Jason:
[40:58] Yeah couple quick precursors we’re going to talk about a bunch of different holiday forecast and kind of how they all roll up but a few things to remember,
every company that forecast holiday sales has a different definition of retail so I like the big ones are is gas in her in or not in retail is food in or not in our cars and you’re not in it so.

[41:19] None of these forecasts are perfect Apples to Apples cuz none of them have the same definition of retail,
and even worse these are all holiday forecast and there’s a shocking Variety in what people consider holiday,
so a lot of people think holidays November and December other people think is November through January there’s some people that think it’s just you for which is October through December and so again there’s a lot of variance in,
in what times are the people are talking about and sometimes they tell you and other times they really don’t so you’re gonna just left the guess what they think holiday is,
most of these forecasts are going to compare their forecast this year with what actually happened last year and I just want to remind our listeners that last year sucks,
there’s a lot of negative things going on there was a government shutdown there was a complicated tax cut that people don’t realize but was kind of in their monthly,
Paychex the stock market took a big drop and so consumer confidence was very low and one of the things that we that we
so I was the savings rate went way up so people I less confidence and they were saving more of their money instead of spending it over holiday so it was a bad holiday last year,
and then this year you know all those cans does macro Trends are more favorable the economy in general feels more favorable you know there’s a couple negative things dangling out there.

[42:42] But one of the big infrastructure things this year is that there are significantly fewer days between Thanksgiving and Christmas.
And when I first say that to people sometimes they look at me funny because they think there’s you know the calendar is always a calendar I remember Thanksgiving falls on the last Thursday in November and so depending on on the counter breaks down.

[43:03] That could be in a different week so last year Thanksgiving was on Thursday November 22nd this year Thanksgiving is on,
November 28th so last year,
there were 34 days between Thanksgiving and Christmas this year are there only 28 days between Thanksgiving and Christmas so there are six less days,
and that’s really scary to a lot of retailers they feel like they have less days to sell their stuff they have left days in West days in this crime shopping. And so frankly,
it really impacted a lot of holiday plans like retailers I started buying as much as earlier they certainly week their Black Friday sales much earlier and that they’re proactively doing a lot of things to mitigate this perception.
That that they’re going to sell last because they have less days between Thanksgiving and Christmas and as I mentioned on the last show there’s actually if you look at the big picture and the history of retail there’s a fair amount of empirical evidence.
That the number of days doesn’t actually affect holiday sales in that like when there are more days,
the sales get spread out over more days on there fewer days the same sales happening you know in the more concentrated set of Daiso.
You know whether it impact or not remains to be seen but you are for sure any time a retailer doesn’t have a good holiday. One of the things I can guarantee you they’re going to blame.
Is the six days.

Scot:
[44:24] And weather Lafayette weather.

Jason:
[44:25] Yeah we always going to be in the weather dries Lee all weather is bad for retail if it’s too warm they’re not selling enough valuable coats and it’s too cold they’re not going outside to buy stuff so it seems like no weather is good for retail,
especially when your comps are for I would also remind people that all these forecasts are about Revenue,
and the much more important thing for a retailer than revenue is profit,
and you know retail share a lot about their comms particularly if they’re a public company and said there’s a lot of levers they can pull to make sure that they hit the revenue goals and one of those revenues is how much they discount the stuff,
and so you know one of the things went when it looks like there’s going to be a soft holiday season retailers turn up all these knobs and discount things,
more aggressively and they hit the revenue numbers but then their Q4 earnings come out in the earnings stock because,
they sold all that stuff at a Deeper Discount and there’s already some evidence that you know because of the sexual today’s that retailers are leaning on that discount,
whoever you know earlier and and you know that could be indicative of a not very profitable holiday season the the other thing that makes me think.

[45:43] Profits could be a little bit challenge is it’s already very clear that retards have bought a lot more digital ads this year than they did last year and again that could be us,
reaction to the the fewer days you know they’re spending more nads trying to catch more eyeballs and obviously Those ads have it cost in that also affects.

[46:06] So those are kind of nice things to bear in mind when we talk about the forecast.

Scot:
[46:10] Jeff kick ass off your you’re up first.

Jason:
[46:14] Three different kinds of companies doing forecast there companies that just forecast total retail sales the most Lee Brick and Mortar and e-commerce is a part of that,
there companies that forecast brick and mortar and then break out the digital sales and then there’s companies that just forecast digital sales,
so we’re going to start with a brick-and-mortar folks in the first we’re going to go with is one of the most commonly cited one you know an organization you and I are both involved with the national retail Federation rnrf.
They do a forecast every year their holiday definition is November and December they’re definition of categories excludes automobile dealers gasoline stations and restaurants.
So they are forecasting that total retail sales are going to grow between 3.8 and 4.2% this year so last year.

[47:05] Sales only grew 2.1% against it was a sucky year so they’re forecasting up pretty healthy acceleration of growth this year over last year,
you know, the middle of the range will be 4% so 4% vs 2.1%,
last really sucked if you look at the last five years the average was 3.7% so 4% is even better than the last the the trailing five your average if you care,
that means it’s about 730 billion dollars worth of worth of sales,
and one thing I’ll say about the NRF is they’re starting to develop a reputation as being overly optimistic,
and so I will say you know I kept highlighting the last year we did 2.1% gross interests forecasted.
Like 4.6% growth of us so they missed it pretty badly last year so they’re they’re forecast this year’s actually lower than their forecast,
last year and so you know hopefully,
they’re going to be more accurate this time around but what you know if you talk to that had Economist it interrupt but they’re going to tell you is.
There are more microeconomics factors,
affecting sales than ever before and therefore they feel like the the sphere of uncertainty around forecasting these sales as much higher than it’s ever been so they would actually say that like it’s tougher than ever to do these four.

Scot:
[48:30] Did they talk about the six days.

Jason:
[48:33] Not specifically in the forecast as I recall they also didn’t talk about the weather.
The sign out like we joke about the weather I’m skeptical about the weather there’s like a huge white paper from IBM talk to you know which owns The Weather Channel,
talking about how forecast that don’t factor in the weather are wildly inaccurate self-serving study but then the other.
Forecasts we have for Pure brick-and-mortar sales is from a strategic consulting company called alixpartners
put a link in their there they’re forecast had a lot less inherited with it but basically they’re forecasting between 4.4 and 5.3% so even higher than the interests forecast their holiday,
a. Is November through January and they don’t tell you what product categories are in there so soup your brick-and-mortar forecast,
one is about 4 % one is about,
4.6% and you know both of those are significantly higher than actual sales last year at 2.1%.

Scot:
[49:42] As the Commerce guy on the show I’ll kick it off with the next to that that have both offline and online retail
first up is Deloitte I will put a linked to theirs in the show notes they’re expecting total sales this holiday to exceed 1.1 trillion they Define the holiday is actually November through Jan 1
and they’re expecting offline or total retail to be in the range of 4 1/2 to 5% which fuel
pretty hot or are kind of on the on the high side and then they’re saying digital will be in the range of 14 and 80%
and that would be up from last year’s forecast
and they’re looking at about $1,500 per household,
for Holiday which you know is pretty robust I think that includes mostly High Spenders in that category.

Jason:
[50:38] Yeah I think I saw something where it like the high Spenders spend on average $2,000 per household but like you know the account for the majority of spending.

Scot:
[50:48] Awesome and then I wonder so it’s too bad you bought all your gadgets before November because well maybe maybe they’ll count November so that they could be you could nudge that $2,000.

Jason:
[51:00] Yes I’m frequently accused of having a very narrow window between desire and fulfillment.

Scot:
[51:07] Appnexus kantar and again will put a link to this in the show notes day to find holiday is October to December which is pretty interesting so it kind of Loops in
Halloween 2 to some extent which is kind of aggressive
but that’s how they Define and they’re saying till retail 3.8% and then online 40% so you starting to sense a theme Here mid-teens seems to be where where a lot of these forecaster zeroing in on.

[51:43] Jason tell us about Salesforce.

Jason:
[51:45] So then the last category are folks that are only for casting online sales in a way these are the most interesting because these are vendors,
that have a big user base so they’re actually using the data from their user base as the basis for their forecasts and then extrapolating it to the rest of.
Of the the industry the first one is Salesforce there to finding holiday is November one through December 31st so there’s two months and they’re forecasting digital revenue for holidays going to grow at 13%,
so that’s going to be like a hundred 36 billion in sales,
and you know that’s a pretty robust forecast one of the things that I like about Salesforce is they actually have a live dashboard that runs over the holiday. Where you can see what the latest trends are in real time so I’ll put a link to their,
their holiday Hub in there as well and then a forecast we’ve used a lot on this show is from Adobe,
he has a bunch of products that are used by e-commerce sites and in particular that and analytics product that use by a lot of e-commerce site so they see a pretty big chunk.
Of e-commerce sales and they use that to base their forecasts on their defining holiday is November and December and they are forecasting 14.1% online growth which is 143 billion dollars based on their,
their definition of retail so a couple healthy forecast for online sales.

Scot:
[53:13] Cool so if we kind of summarize everything and look we come up with online that the average of the forecast is just North of 14%
the range is between 13 and 18% and if you recall the the setup from Amazon was pretty robust they
they’re going at like 22% and third quarter so I kind of feel like even this is a little conservative cuz just Amazon alone being happy be Commerce if it if they can do,
20% Then That imply the rest has to go at like 10% can I get to this 14% so lefse but
I feel like these things are a little on the conservative side but yeah we’ll see,
the Russian thing is we used to rely on comscore for kind of a you know how did we do last year and they it’s best we can tell would love to if any listeners know otherwise
they’ve stopped kind of rounding up the entire holiday they’ll talk more about certain days and Trends they they’re not out on record saying 2018 was X percent so
they used to be our go-to so there is no really good one source for how last year was so you know it’s hard to
compare that to how last year was I feel like it’s 2 to 3% higher than kind of like what we saw last year but you know there’s no clear date of went out there.
The Jason wants you some rest total retail.

Jason:
[54:42] So kind of the the average of the four total retail forecast is like 4.35%,
the range was like 37253 and again last year was 2.1 so very healthy total retail gross,
this year vs last year and again last year was a pretty down here,
but these forecasts are all slightly better than the five-year average so that’s.
Potentially a good thing on the revenue side again if I were betting I don’t think it’s going to be a phenomenal year on the profitability side I think.
Yeah they’re already have been a lot of Paris in the the retailers and manufacturers seem of each other.
Cost of the Terrace cuz they haven’t really you know been priced in prices are pretty competitive as we stopping that profits Euro study there’s a bunch of studies that people are spending more on ads and discounting earlier so,
you know I think we may Goose The Top Line and not have a phenomenal bottom line but I would love to be wrong.

[55:47] But that is going to be a good place to eat it because I feel like we’ve used up a little bit more than her a lot of time but hopefully it was all valuable and if you did find it useful we’d love it if you jump on iTunes and finally give us a 5-star review,
if you have any further questions or want to chat about anything we talked about tonight as always hit us up on our Twitter accounts or leave a message on her Facebook page.
And Scott and it’s always nice chatting with you.

Scot:
[56:15] YouTube thanks everyone we really appreciate it we hope you’re locked down with all your holiday
pricing strategies your inventory everything’s locked and loaded we got singles day which is going to come kick it off here coming up next week will keep you posted on what we’re seeing out there and e-commerce and retailing.

Jason:
[56:33] And in the very near future are very special 4 year anniversary 200 episode so that you sure to catch that one until next time happy commercing.

Nov 8, 2019

EP197 - Personalization Deep Dive

This episode is a deep dive into Personalization.

  • Definition and Level Setting
  • Best Commerce Practices
  • Future Opportunities
  • Conclusion and Recommendations

Don't forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.

Episode 197 of the Jason & Scot show was recorded on Monday, September 30. 2019.

http://jasonandscot.com

Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer at Publicis, and Scot Wingo, CEO of GetSpiffy and Co-Founder of ChannelAdvisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.

Automated Transcription of the show

Transcript

Jason:
[0:24] Welcome to the Jason and Scott show this episode is being recorded on Monday September 30th 2019 I'm your host Jason retailgeek Goldberg and as usual Wingo.

Scot:
[0:37] He Jason and welcome back Jason Scott show listeners a couple exciting things number one we are in the same room which rarely happens I think maybe one 18th of our episodes are in person we're we're in the same room so that's always fun.

Jason:
[0:52] Are we always going to see you at their my favorite and when we need to break out and you know use the big brains 100% of our brain for an episode I feel like we do our best work when we're together in the room.

Scot:
[1:02] Absolute between us we have a brain so one of the big request we've been getting a lot of lately is for another Deep dive.

Jason:
[1:12] Jason and Scott show.

Scot:
[1:25] So today show is going to be a deep dive and about a year ago so apologies. Everybody we we put out a call for listener request on deep Dives and one of the number one requested topics was personalization,
that is one of Jason Specialties he's flying around the country constantly giving this talk for millions of dollars an hour so you guys are getting a great treat
the only cost for this one is five stars so if you like what you hear give us five stars other people are paying high
9 figures for this talk so I'm going to be a fly on the wall in this one I'm going to inject hopefully some kind of intelligent comments as we go along but Nick kick it over to Jason who's going to,
dive deep into the world of personalization.

Jason:
[2:13] Did you just tell everyone that I go around the world with a can presentation that's exactly the same for every audience that's about personalization.

Scot:
[2:21] I'm sure you personalize it that's let's talk about that do you personalize your personalization.

Jason:
[2:25] I for sure personally the cover slide and nothing else.

Scot:
[2:28] Okay well that counts.

Jason:
[2:30] Yeah and we we may talk about that but I've tried to break the show up into four main components today we're going to do a little bit of talking about,
definition of personalization and level setting everyone get kind of all of us on the same page then I'm going to talk about what I see as sort of best practices today,
country folks are doing and what some of the best examples are out there personalization
and we're going to as we always do in the show kind of pivot to the near future and talk about what's coming and what's what's down the road a little bit in terms of personalization and maybe wrap things up with a,
couple of conclusions and recommendations that folks can take to their day job if they're thinking about personalization.

[3:14] So with that let's Jump Right In to the definition and the first thing I would like to remind people about more talking about personalization is.

[3:25] The beginning of Commerce by the phone almost all shopping experience were personalized like shopping was a very one one experienced you are usually working directly with a merchant,
and that Merchant was personalizing the shopping experience,
to every one of their customers so yeah if you're old enough to have watched a Little House on the Prairie and you think of mr. Ingalls General Store,
misery Ingles new all the customers that came into a store most of the goods were in the back and a stockroom so you talked to mr. Ingalls told him what you wanted to buy he'd go back,
get your goods and if you bought less sugar than you did last month or you bought more flour or something like that,
he very likely would have a conversation with you about why you were changing your order and he would know about you and he would personalize that shopping experience to your needs,
and so what his sort of happened is the population of the Earth dramatically expanded from that General Store format and we were no longer able,
deliver that personalized one-on-one experience to every Shopper and so we kind of,
went to the the ear of mass marketing and mass retail and you'll be able to fit a bunch of customers in the store and have a beer a self-service and so what's interesting to me is all of this modern digital Shopper marketing,
what is really doing is letting us get back to the kind of one-to-one experience that mr. Ingles used to deliver.

[4:53] I'm sorry mr. Olson used to deliver but now do it at scale and so when we're talking about personalization,
to me it's really getting back to the best practices of the origins of Commerce that being said,
one thing that always annoys me about this topic is,
personalization isn't a single thing it's a tactic and it's a whole range of tactics and so.

[5:23] Frankly I see a ton of studies and there's always a sort of Talking Heads talking about like,
oh gosh 60% of customers want a more personalized experience if you deploy personalization you have 13% greater sales or higher A RVs or all these different things,
and I was like to remind people that somewhat absurd because,
there's no definition for what. Personalization is it's it's a tactic it's kind of like saying stores with green paint will sell more stuff well,
where is the green paint and what color is the tree in paint and in some cases it might have a prominent pronounced effect in some cases it might have a negative effect so I just when I talk to clients that are starting a personalization initiative I like always start by reminding them,
we're trying to achieve is not personalization like the goal isn't just to have something to be more personalized than it was before,
personalizing things to make them more relevant to the customer and make the customer more successful and so I always like to begin with that end in mind that were the outcome we're really seeking is relevancy not personalization.

Scot:
[6:32] So then to all of our listeners out there probably have 50 things they could be working on if you can't say spend X get why then how do you help them understand where to put personalization and their party list.

Jason:
[6:44] So I actually wouldn't I wouldn't have personalization as a initiative on my road map and say I'm prioritizing it number 12 I would have initiatives on my road map like,
improve my conversion rate increase my customer lifetime value increase my engagement with my content I would have bills like that and,
in the process of achieving some of those goals one of the tactics that's going to be very helpful is to personalize the experience to achieve those goals so it's always a red flag,
when I see people that have quote-unquote personalization on there on the road map and you know I'm somewhere,
negative and sarcastic,
one of the Retailer's that's been the awful lot of time talking about their personalization success and they get used as an example all the time is a brand that was bought by QVC called Zulily a daily deal,
and they made the road shows and then all these case studies about their personalization and the really,
did they generate millions of custom landing pages every day for their customers.

[7:55] 99% of that custom landing page means that it says welcome Scott in the right-hand corner when you go to that page,
so technically that is personalized they know who you are in the page changed but if the offers aren't more relevant if it didn't somehow make you more successful,
it's it's not a meaningful personalization.

Scot:
[8:16] One More For Dummies question that hopefully some other listeners have so when I talk to a Lottery retailers they always some retailers you go visit their older obsessed with Persona so you'll go to visit some
extra pictures on the wall that say you know this is Debbie she's a soccer mom she's
40 - 35 she's got two kids and she lives in suburban and then doll,
a lot of times they'll customize the user experience for those people in Dick's Sporting Goods does a lot of this as does
Best Buy,
so and I Best Buy one of the guys for the book The Angel customer demon customer in a lot of the Persona stuff comes out of that if you and I think she has like
cat lovers dog lovers and,
both animal lovers so if you go and you kind of have the experience so you know when your database that Jason is a cat person and he is a dad of a toddler and that's Persona is that personalization,
and then you have time of different experience that person.

Jason:
[9:19] To me that absolutely is personalization it's on the spectrum of personalization right so if you're someone that has historically had like a one-size-fits-all marketing program you have 5 million names in your email list,
once a week you blast all five million of those people of the exact same email and you instead go hey you know what,
half of that email list for dog lovers and half for cat lovers so I'm going to segment my email list in the two chunks and I'm going to email a cat email 2/2 and a dog email to have that absolutely is personalization,
it's not as far on the spectrum is saying,
this emails going to Scott and I know that he only buys grain-free cat food and so I'm going to send him a very specific email that only he got based on his unique attributes,
personas are a very useful way to do this sort of intermediate step and often,
frankly that that still today is the high value stem so often the ROI you get from going from,
a one-size-fits-all campaign to a Cygnet a campaign,
is much more significant than the incremental Ryu you get by going to the much more expensive dynamically generated when one campaign if you will.

Scot:
[10:39] Coke so hopefully you will I'm sure you'll hit on the Spectrum but the reason I bring it up is a lot of these start-up I'm a startup guy and all you start up Brands come to me and they said look I want to do,
discount personalization stuff and their you know to them it's a 5 or 10 million dollar project cuz there's this database I know you guys have something name for this database that like,
put all the stuff together there's a serum feeds into it and then like all this data.

Jason:
[11:02] The customer data platform.

Scot:
[11:03] Yeah the CDP yeah and then you know they go look at the vendors for that and that's like in a couple million box and then like the project on it and all so just feels unobtainable
mom and you know it just feels like this huge thing to do personalization whereas my recommendation is just start with pre simple segmentation and then even then
you know you can get a little bit of refinement in there and even that you talked about it and email marketing even on your website you know you can kind of have in your Skyrim
are there cat or dog person and then showing a little bit different content feels like you should get a that's more of a $100,000 project versus a 10 million dollar project.

Jason:
[11:39] And we'll get into that a little bit better off and it's even are they return customer versus a first-time customer right maybe I don't like are they already in my email marketing list maybe I don't need to use that pop up to interrupt others who were asking for their email address when I already have.

Scot:
[11:53] Yeah or push the product I know they just bought 5 minutes ago.

Jason:
[11:56] Exactly like so very often it's those simple steps that are that are high Roi we're not going to get deep in,
personas but I will like since you brought it up I'll make one comment on person personas the mistake a lot of people make on personas is they start internally in,
so they go who do we imagine our customer is who do we want our customer and so I'll be,
retail R I work with has a Persona and very rarely does the Persona on the wall map the demographics of their customer base so,
almost always the Persona is this like young hip stylish woman.

Scot:
[12:40] Affluent urbanite stylish.

Jason:
[12:45] Who is coming from women that are 15 years older and are doing more utilitarian shopping until,
is aspirational personas there's there's places where they can be beneficial but often people confuse those with her actual personas.

Scot:
[13:01] The same thing with them.

Jason:
[13:02] And the same thing with demographics like people often start by saying like,
we should do things different from Millennials then we do for Boomers and they they take some random trait and then,
ascribe different experiences to that different trait of the customer and that's actually opposite of how you really want to do it what you really want to do is say,
like who are most valuable customers and what traits do they have in common and it's so it may be aged and maybe geography and maybe use case,
personalization based on some traits as opposed to identifying the trades Based on data is a a common mistake week we see in marketing,
so
I wanted to sort of talk about what some of the common kinds of personalization that that we see today because there's so many different touch point,
they can be personalized and they can be personalized on different spectrums.

Scot:
[13:57] Personalization acronyms.

Jason: