Cuppa Commerce

Dallas-based Daniel Vitiello, along with his business partner, Brandon Warman, has founded two startups (so far), both in the food/grocery space. Daniel and I chat about lessons learned during the development and launch of Handground, their coffee grinder, and how their latest venture, mobile app Cooklist, may revolutionize both grocery shopping and meal planning while helping consumers eat healthier, spend less time shopping, and save money.

In this episode, we discuss:

• How Daniel and Brandon got their start in business and as entrepreneurs, including launching a new manual coffee grinder, Handground (available via Amazon)
• Taking learnings from Handground, how Daniel and Brandon surveyed people passionate about cooking to test their initial ideas for a food/cooking app
• How joining the TechStars accelerator program in 2018 – including working with Target – helped drive the initial launch of the Cooklist mobile app
• Two recent developments that make an app like Cooklist possible:
  • Grocery store loyalty program data being made available online
  • Widespread availability of home delivery for groceries
• How Cooklist currently solves two primary pains:
  • Figuring out what you can prepare using ingredients/products already on hand
  • Tying selected recipes to your (online) shopping list, while accounting for what’s already in your fridge and pantry – and as a bonus, potentially comparing order prices across grocers (more retailers are being added later this year)
• How the just-released Cooklist meal planner feature recognizes that consumers don’t always cook “meals” but sometimes just heat up a frozen pizza or eat some yogurt
• Benefits to grocers, including (a) having customers who get more from their purchases and (b) reducing the friction involved in buying groceries and getting them home
  • Grocers have been losing “stomach share” for many years
• Why Cooklist looks to avoid business models that profit primarily from selling consumer data, preferring to provide a valuable service they’re willing to pay for directly and maintaining trust
• What a future Cooklist – part personal chef and part omniscient planner/shopper – might look like
• What future innovation in this space is coming, including current pilots of in-home delivery of groceries

After a long career with Elsevier, Amanda Wolff is now the CMO for OneSpace, a tech startup that specializes in helping consumer packaged goods (CPG) companies improve product and content visibility on Amazon and similar online retailers. We chat about what’s happening in the CPG ecommerce space today and accelerating changes in how consumers shop for and buy these products online.

In this episode, we discuss:

• How delivery services (e.g. Instacart) and click-n-collect capabilities are impacting fast-moving consumer goods like beverages
• Ways OneSpace works with clients to establish or evolve their ecommerce operations, ensuring they optimize their online content on a regular cadence
  • Where your products sit on a “digital shelf” and their search rankings can change every day or even during a single day, requiring constant vigilance
• The process of optimizing product content and getting it out to retailers so it’s available for online shoppers
  • In addition to its content distribution platform, OneSpace content creators actually develop rich product content or optimize baseline content available from manufacturers
  • Traditional CPG content was pushed to consumers and is rather emotive and high level; however, online shoppers “pull” content using search, so content presented in search results needs to be more detailed and drive purchase
• Industry disruption caused with a move to sell directly to consumers online vs. going through the large retailers
  • Much of this has been driven by industry upstarts, emerging digitally native vertical brands who use social commerce and influencers to tell their story directly to consumers and build demand outside of traditional retail channels
  • How larger CPGs are using acquisitions to bolster their direct-to-consumer (D2C) offerings and skills
• Some dangers of working with large retailers, particularly Amazon, including retailer-owned white label products
• The importance of access to consumer data, including what they are searching for
  • OneSpace leverages this type of search data to drive effective content creation
• Why optimizing your product content for voice search is now less of a concern than changes to retailer programs like Amazon Vendor Central and Seller Central
• How ecommerce teams in CPG companies can provide a more holistic view of the consumer for organizations which have traditionally been segmented by brand
• Why Amanda believes the coming year will bring more innovation with grocery and fast-moving product delivery options in North America, catching up with service levels already seen in the UK and Europe

CEO Sonal Puri of Webscale shares how her company helps B2C and B2B sellers of all sizes manage their cloud infrastructure globally, helping them take advantage of the cloud’s almost infinite scalability while optimizing costs, security, and performance.

In this episode, we discuss:

• As a startup, how Webscale is disrupting the digital infrastructure space as “the digital cloud company” for more than 1000 online stores globally
• Webscale’s ability to manage applications in the public cloud on behalf of customers across all the “hyperscale” cloud providers, including Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform (GCP), Alibaba Cloud, and others
  • The company’s experience with online commerce is key to helping clients manage their infrastructure for maximum benefit with minimal cost
• Large hyperscale providers are providing very reliable, scalable cloud infrastructure/hosting on demand, while Webscale runs its own services on top:  security, predictive autoscaling, performance, caching, content optimization, bot management, etc.
  • Webscale provides an easy-to-use interface/portal for customers
  • It also ensures cloud computing consumption is always right-sized so customers don’t pay for more than they use
• Infrastructure as a commodity or utility, like electricity, allowing retailers/brands to pay only for what they need, when they need it
• How today’s technology and cloud offerings allow smaller retailers to access the same tools as leading global brands, leveling the playing field
• Why it makes sense to use a vendor like Webscale to manage your cloud infrastructure
  • Migrating applications to the cloud from traditional hosting models can be confusing and challenging
  • Costs start to add up quickly if you don’t manage your infrastructure actively
  • Security concerns are only escalating and require constant monitoring
  • 24x7 global support includes expertise across multiple clouds
• Why even the data layer no longer presents scalability issues if the infrastructure is set up correctly, even for retailers who see 20x or 30x traffic spikes during peak seasons
• Migrating infrastructure to the cloud typically takes anywhere from 1-2 weeks up to 2 months, depending on complexity and the amount of testing required
  • With good business requirements, Webscale quickly figures out the right solution using available providers
• Why Sonal believes the infrastructure market will undergo further commoditization and look more and more like a utility, with probably three hyperscale providers and perhaps a small group of very targeted cloud providers (e.g. a health cloud or database cloud)

This time I spoke with three commerce veterans who share their experience transforming how small- and medium-sized businesses offer an Amazon-like shipping/delivery experiences and compete with ecommerce giants:  Raphael Neff, owner of ChessHouse.com; Akhilesh Srivastava, founder and CEO of Fenix Commerce; and Vince Cavasin, head of marketing for Fenix.

In this episode, we discuss:

• How Fenix “democratizes Amazon features for the masses” and helps mid-market retailers differentiate themselves with a better delivery and fulfillment experience
• Why delivery considerations/options should appear on product pages and not just in checkout, since delivery is a major purchase consideration
  • ChessHouse.com has experienced a 37% improvement in conversion rate, much of which Raphael attributes to Fenix
• Overall, Fenix customers average:
  • 14% improvement in end-to-end conversion (shopper on product page who submits an order)
  • 38% improvement in cart abandonment rates
  • 21% increase in shipping revenue
  • Large decrease in pre-purchase inquiries to customer service
• The importance of not only presenting enticing free shipping thresholds but also offering “reasonable” shipping upgrades for speedy service
  • Up to 40% of retailers using Fenix see customers paying for Fenix-calculated, enhanced low-cost shipping, even when a free option is available
  • A firm delivery date is attractive versus an ambiguous range (“5-7 business days”)
  • Testing various price points – while also considering internal delivery costs – is key to finding the sweet spot with your customers
• How Fenix uses machine learning to augment data available from the retailer to determine the probability of shipping dates being accurate
  • The retailer has control of many parameters, based on weather events and seasonality and similar factors
  • It takes about 1 year of data to get accurate predictions
• Ways Fenix can provide additional data about actual performance, which often drives operational improvement and improves bottom-line results
• Why Fenix takes a consultative, collaborative approach with each retailer to ensure Fenix is leveraged for maximum impact

As data experts with both consulting and client-side experience, both Patrick Ezell of Bridgetown AI and Andrew Duffle of Data in the Raw are excited by how retailers and direct-to-consumer brands can leverage all the capabilities offered by Amazon Web Services (AWS) and Google and other emerging technologies to build a winning commerce strategy – if you embrace change and hire people passionate about data.

In this episode, we discuss:

• The origins and focus of both Bridgetown AI and Data in the Raw, and how they differ from other offerings on the market
• Key evolutionary improvements for data from a digital commerce perspective
  • Plummeting costs of data storage and compute with AWS and Google offerings
  • Rising demands for online privacy and rollout of GDPR and similar laws/regulations
  • Higher consumer expectations for a tailored and compelling online experience
• The need to invest in smart, passionate data science talent to maximize the effectiveness of today’s tools and data capabilities
  • Finding/grooming data talent when you can’t afford, or find, PhD-level data scientists
  • The necessity for all digital commerce professionals to become data conversant, if not data fluent
• Why it is imperative that brands (not platforms) own their own data
• Where automation can be applied using data and related tools
• Why, if you completed your last big BI initiative 5 years ago, you are now “generations” behind in what’s possible with data
• Why the near future promises:
  • Massive growth in microservices, which will put pressure on expensive and monolithic legacy platforms as new, innovative players come to market
  • That more companies will bring all data in-house as solutions scale quickly and more cheaply
  • A more level data playing field, allowing smaller retailers to have the same insights and capabilities of the Fortune 100 enterprises

As the co-founder and CEO of SUMO Heavy Industries, a boutique digital commerce consultancy, Bart Mroz focuses on helping clients’ digital teams become more successful. He takes his coffee black.

In this episode, we discuss:

• Bart’s 20-plus years in the commerce industry and the founding of SUMO Heavy
• SUMO Heavy's focus on emerging sellers (up to $25M annual revenues) and the enterprise space ($100M+) and the company’s intentionally limited number of clients
• How SUMO Heavy assesses what new clients need and roadmaps the work to come
• The current commerce environment and what retailers and brands need to compete and succeed (hint: it’s the consumer experience)
• The value and dangers of the overall transparency demanded by consumers today
• How the ecommerce platform space has evolved over the years, and how to think about current offerings (e.g. Shopify, Big Commerce, Workarea Commerce)
• The push towards microservices and why Bart expects even more commerce software options to hit the market in the next two years
• Whether retailers are moving more into “optimization mode” versus just implementing new, shiny solutions to solve their problems
• Why 2019 will be the year when retailers step back and find ways to work more efficiently and make ecommerce work better for the business – while some new commerce plays/models will come to market in the next wave of DNVB (digitally native vertical brand) innovation

Currently the VP of Partnerships at Coredna, Paul Savage leverages more than 15 years of digital experience to his role helping companies like Nintendo, Tivoli Audio, and Stanley grow their brands using the Coredna suite of applications. Originally from Cork, Ireland, Paul has also worked in Germany and likes his cuppa (double espresso) very strong indeed.

In this episode, we discuss:

• Coredna’s origins as an in-house content management solution developed by an agency in Australia back in 2000, the more recent focus on ecommerce and push into the North American market, and how the solution has evolved into the fully featured, multi-tenant SaaS-based CMS + ecommerce platform offered today.
• The advantages of having a single platform – and thus a single business interface – that handles both content and commerce for brands, with the added bonus of maintaining a single view of the consumer.
• How Coredna can help scale an emerging brand, from initial story-telling and marketing efforts through to a full-blown commerce model and even international expansion.
• Some of the applications Coredna provides that position it uniquely in the content and commerce market today, including ticketing, PM tools, and B2B inventory functionality.
• How industry “commoditization” is driving down costs and timelines, helping new brands go to market more quickly.
• Why today’s platforms are distinguished more by their usability and ease of adoption rather than unique feature sets, as most platforms today deliver a long list of capabilities.
• Advantages (and some challenges) provided by a multi-tenant solution where all clients access the same core platform/applications.
• Some recent commerce/data news from McDonald’s and Instagram, and what this might mean for retailers and brands trying to read the tea leaves.
• The continued prominence of brands going direct to consumers, and the huge opportunities with B2B ecommerce.
• Why 2019 will be the year of brands going global and optimization of recent investments in new technologies and tools.

Currently the VP of Sales & Business Development for WhatCounts, an OSG company (formerly Windsor Circle), my guest Gautham Pandiyan is a scientist-turned-software expert who focuses on the retail, ESP and related markets. His team focuses on adding value to marketers’ personalization initiatives, helping them grow profitable repeat business.

In this episode, we discuss:

• Windsor Circle’s recent acquisition by OSG and merger with WhatCounts, an email marketing provider, and what this means for the joint company’s offerings.
• The evolution/range of digital personalization capabilities, from Personalization 1.0 (using a customer’s name) through Personalization 4.0 (predicting buying behavior).
• Why personalization drives a more engaged and loyal customer base and, ultimately, a higher lifetime customer value, even in an era focused on privacy (e.g. GDPR).
• Personalization as a strategic imperative, not a nice-to-have, and its role in building a strong loyalty program.
• That email remains the most cost-effective and effective direct marketing tool, but how you can pair email strategically with social ads and other media (even direct mail) to increase impact of marketing spend.
• Creative ways to track and measure the impact of your marketing efforts across channels, beyond last click attribution.
  • How WhatCounts determines which specific automated marketing actions cause conversions using randomized control groups, like in a medical trial.
• Busy marketers needing to carve out time to test innovative tactics – and when to use outside vendors to accelerate innovation and leverage more from your solutions.
• Why data and adoption are two of the biggest challenges with marketing technology.
• Why in 2019 we’ll see up to half of retailers/brands fail to launch personalization initiatives on their roadmap, and how big of an impact new loyalty programs have on the bottom line.

Currently the VP of Global Strategy, Transformation, Alliances and M&A for Tyco Retail Solutions, a division of Johnson Controls, my guest Amin Shahidi draws on a wealth of experience helping companies in retail, consumer goods, healthcare and other industries deploy transformational initiatives. These days in particular, his team offers expertise through leading-edge technology to help retailers achieve real-time inventory visibility, improving accuracy and operational efficiency.

In this episode, we discuss:

• How retailers looking to evolve their store environment should tie transformation efforts to three key business outcomes:
  • Share of mind (brand penetration)
  • Share of wallet (revenue growth and profit)
  • Operational excellence (including safety/security)
• Where different verticals focus on improving stores:
  • Fashion retailers = the in-store experience to improve conversion
  • Food and drug = growing wallet/market share over time
  • DIY = inventory and keeping shelves stocked appropriately
• How merchants in Asia (particularly Japan and China) are decentralizing decision-making/planning to accelerate innovation with autonomous/frictionless stores.
• Why getting a handle on inventory isn’t only about visibility but also about price/cost and the distribution of inventory to match it with market demand.
• Why just adding a bunch of point-to-point solutions in store may become the “legacy problem” of the future, and why having a true IoT architecture is key.
• How to get started with digital store initiatives by doing a gap analysis of where you are now vs your desired target state, regardless of technology:
  • What would you do differently if you had perfect understanding of everything happening in your stores: personnel, assets, customers?
• Why “digital transformation” needs to reach stores and not remain an “enterprise” endeavor only.
• The problem of “curation”:
  • No longer can just present inventory (“stack it high and watch it fly”)
  • Needing to curate the experience is what has caught retailers off guard

Why 2019 is the year of evolution, not revolution. Retailers who are investing already in the digital store will continue to gain market share over those who wait.

A former developer and long-time veteran of the commerce platform industry, Bill Tarbell of Workarea Commerce has made a career of simplifying the complex. He shares where we’ve been and how the commerce industry needs to continue its evolution to better serve retailers and merchants of all sizes.

In this episode, we discuss:

• Three eras of commerce platform evolution, from early “framework” type offerings (ATG, IBM WebSphere) to open source and ease-of-use pioneers (Magento, Demandware) to today’s modern, SaaS-based solutions (Shopify, Workarea Commerce)
• How Workarea aims to bring greater flexibility and customization to retailers and merchants who want to create an innovative experience across channels and customer touch points
• The difference between “microservices” and “headless” commerce architectures
• Where microservices works best versus headless approaches or “monolithic” platforms
• How standardization is coming (but isn’t here yet), when the commerce platform market becomes truly commoditized – more innovation to meet market needs is needed
• Why retailers/brands should make time to evaluate and understand what type of technical approach and platform will work best for the organization – and hold vendors to high standards of transparency in the sales cycle
• Why 2019 should drive greater integration of commerce and content, and enable brands' ability to deliver both faster than ever