EP196 - Apple Flagship, News, and Listener Questions

EP196 - Apple Flagship, News, and Listener Questions

 

A weekly podcast with the latest e-commerce news and events. Episode 1946 covers a visit to Apple's new flagship on 5th Ave in NYC, recent industry news, and listener questions.

Apple 5th Ave Flagship Reopens

News

2019 Holiday season has 6 fewer days between Thanksgiving and Christmas Credit card companies release new e-commerce payment flow EMV SRC  Best Buy moves to one-day delivery Nordstrom opens New York Flagship Barneys Bankruptcy eBay, Nike, and Underarmour get new CEO's Google Shopping flash sale and ‘buy on google’

Listener Questions

Q1: Michelle Grant - Amazon and Walmart have patents around predictive shipping. Could you speculate on what impact predictive shipping will have on commerce? You mentioned it in episode 187, but it would be great to get more details.

Q2: Holly Marie Pfeifer What’s the future look like for personalization with ITP cracking down on Safari and talks about Google being close behind in restricting third party cookies?

Q3: Jeff Vogl I saw Jason’s question to Tobi about performance and PWAs, do you see them actually sticking? I know they “hot” right now, but how many PWAs do either of you have on your phone? Of those, besides Amazon, how many do you really use? Seems like something that works for the Amazons and Nordstrom’s of the world, but do you see it as a mid market reality?

Q4: Karri Koivuniemi Any new info regarding what Adobe is doing with the Magento? What's your brief take on the current ecom platform landscape?

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 October 24th, 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 Thursday October 24th 2019 I'm your host Jason retailgeek Goldberg and as usual I'm here with your co-host Scot Wingo.

Scot:
[0:37] Hey Jason and welcome back Jason Scott show listeners,
Jason I've been firmly planted here in North Carolina lately but I understand you've been traveling around a lot and one of the places I'm super jelly that you got to go to is Apple's new flagship tell tell us about that experience.

Jason:
[0:57] I sure sucks. So this is the Fifth Avenue Apple Store in New York city so this was one of the first kind of.
Architectural a distinct stores that Apple opened.
And I I would I shouldn't remember what year it opened that I don't so it was called the cube so you know it was an underground store but above the ground they built this giant glass cube,
with the floating Apple logo in it and you you kind of walk in and you either take a glass elevator or walk down this glass stairway into this underground store and the store has been closed for,
probably a year while they were remodeling it and they opened it.
Just in time for the iPhone 11 launch so I wasn't there on the launch day but I was there the next week and got a chance to check it out.

Scot:
[1:50] Wrinkle does it have that or they caught Town Hall kind of I would like the big wall in them.

Jason:
[1:57] Yeah it does it it is there new.
Format the sort of city format so it has live trees in it it has a big Auditorium where they have a lot of educational content.
This is already a quite large door and that it dramatically expanding in size so it's,
it's a very big store one of the you know the old one was underground and it was all artificial lighting one of the things they did this time as they installed a bunch of.
Fancy skylights so you know skylights throughout the roof and they all have light meters on them so the ambient light in the store,
adjust to how bright the sky lights are so when it's bright outside the store is almost you know fully sunlit,
but at night or on on overcast days there's more to ambient Lighting in the store so it's sort of a clever.

[2:56] Fancy system I check a little bit because the this was the first store to have the glass staircase and that that's become a signature item for apple and then this door it was quite,
controversial that the staircase is super expensive to build,
and then a couple years after they opened it they had to remodel it and they upgraded the staircase and I don't know if you remember this but at the time like,
the vendor took out the old staircase and through the stairs away in dumpsters outside of.

[3:29] The store and entrepreneurial Apple Fans when dumpster diving collected these.
These individual stairs from the glass stairs and sold them on eBay for quite a lot of money and.

Scot:
[3:45] I'm not forget dumpster dive to make some money.

Jason:
[3:48] Apple is really well I'm glad you didn't because Apple was really pissed and they they liked sued everyone that had one and tried to get them back and they like famous with,
fire the vendor that did the work and you know if it became this Big Brand thing the Apple didn't want these like.
This old Remnant from their store out on the market today it felt like a ginormous over reaction to a.
You know some fans like like loving the Nostalgia of Apple but I will say it rains and snows a lot of New York and it was super impractical like all these people with wet shoes.
Walk into the super slippery glass stairwell and the first thing Apple had to do like the first week they open the store is they had to hire a full-time guy with a mop.
Just to be like constantly cleaning the stairwell and overtime with Abate they did is they threw in the towel and they they had like rubber,
covers,
did they would have over the glass stairwell for you know the winter season and so when I went back the first thing I was interested in it was that you at the stairwell and they totally gave up on the glass stairwell and it's now metal steps with like.
Like a traction on it and stuff and I I imagine to myself that that was a about a piece of value engineering that they could only do after Steve Jobs have passed because I don't think he would have never accepted that.

Scot:
[5:16] How pedestrian metal stairs I would never go in that store.

Jason:
[5:19] Yet still at school the story is beautiful but I would not say it like.
Move the ball forward in any meaningful way like it it uses all of the the traditional Apple gestures it feels very much like any of their other more modern Flagship stores and it's,
it's quite big but there's nothing that you can get at that store that you can get at dozens of other Apple Stores and bigger equals.
More of the same stuff not necessarily new stuff so in general like based on the amount of hype they had around the store I would call it slightly overwhelming it's a perfectly fine store there's nothing wrong with it but.
It wasn't as I don't know evolutionary over previous stores as I had hoped.

Scot:
[6:07] You mean underwhelming you said overwhelming.

Jason:
[6:09] Oh gosh yes I apologize exactly meant underwhelming one kind of cool thing,
yeah because some of the the new products that the what's it called the homepod is meant to be a sort of an audio file,
Calibre product like they do hit now have like a.
Like I so living room and then in an enclosed whistling space where you can kind of walk into a a little living room with a leather couch that's a little reminiscent of these.
Magnavox ads from the 80s and you know listen to the airpod in a in an enclosed room instead of just on one of their wooden tables.
And there's a secret exit I guess is the other interesting thing now so if you do.

Scot:
[6:55] What.

Jason:
[6:57] Yeah so if you you know there's a tourist entrance which is this stairwell and they're often is a line to get the bag down the stairs and into the store and it it's cool but it's kind of inconvenient answer they now have a like a.
10 of a discrete stairwell and a side entrance that you can like if you're local and needed to grab something you could pop in and out without going through the tourist entrance.
So that's mine my scoop on Apple Fifth Avenue.

Scot:
[7:26] Any other trip reports to of what you've seen out there.

Jason:
[7:31] Also on that trip I visited some other New York retail that we talked about the Nike House of innovation store before and I want to go back cuz I've been there during the grand opening
and to their true that they've done a month they continue to evolve that store and they actually had a pretty cool exhibit on the ground floor so.
They have a a new like cushioning technology that they're promoting that uses thousands of little beads in the shoes.
And so they they built kind of like I don't know what the best way to call it like almost like like one of those ping pong ball pits.

[8:11] That you that you know kids would play in they built a giant caged pit,
were the entire floor is this cushioning technology and then they figured out a way to project a digital image on the entire floor so they have things like.
You know I cash a fake colored balls thing where you can run around and kick balls around and try to pop balls they're all virtual balls but it causes you to jump up and down on this floor a lot and you can you know you have all these bites.
Different sort of instagrammable physical moments and you know people were in New York were in line to sort of get their picture taken in this so I kind of cool novel.
Digital physical experience and.
In the way you got in line is you had to be a nikeplus member and be running the app in the store and only then could you get in the queue so I thought that was kind of a clever experiential elements.
To add to the to the Nike store and Nikes leaning heavily into forcing you to be a nikeplus member and having a lot of self-service mobile experiences in the store so this this kind of perfectly played into all of those things.

Scot:
[9:26] Lyrical will this episode of the Jason Scott show aside from the the trip reports is really focused on we're going to do some non Amazon news so you're where we have been Curry Amazon a lot here lately so wanted to catch up on some non Amazon news
then we've also had a fair number of Wooster questions kind of TWP out on our Facebook page for we've had a pretty good discussion going so Jason watch on the new side.

Jason:
[9:53] So the first news item was sort of saving for our holiday show it's already starting to come up a few times so I thought I would that we needed to briefly mention it here.
The way the calendar works this year.
Thanksgiving falls on the latest calendar day it possibly could which means there are six fewer days between Thanksgiving and Christmas.
Then there were last year and the reason I bring this up is,
a lot of retailers are going to tell you you know that if they're their sales are soft at all it was because they had fewer selling days to sell this year and it already came up in the Amazon earnings call which was today,
in a couple of other retailers have already issued cautionary tales that they have 6 who is selling days.
And maybe we'll talk about this little bit more in a in a holiday took a show but,
what are listener should know is that there's no science to the fact that when there's fewer days between Thanksgiving and Christmas that consumers spend less for holiday so like.

[11:01] Back in the 1950s holiday shopping started on Thanksgiving and went through Christmas but for the last several decades holiday show shopping and started in the very beginning of November and went through Christmas.
And there are still the same 61 days.
Between November 1st and Christmas and New Year's at that there have always been in so like what tends to happen is when there are fewer days between Thanksgiving and Christmas.
Purchases get compressed more and then there's less of a lowlands in shopping between the.
Thanksgiving holiday in the Christmas cut off but I just want to sort of pre-plant listeners cuz we're already starting to see articles.
Almost all of the retail data supports the fact that the number of days between Thanksgiving and Christmas doesn't have a material impact on.
Holiday sales so when you hear that be skeptical it's a little like when retailers by in the weather.

Scot:
[12:01] She just took away the everyone's excuse for a bad holiday.

Jason:
[12:04] Yeah yeah sorry about that but like I feel like there should not be an excuse like everyone should have a good holiday.
Unless something wacky happens with tariffs between now and then.
I would seems unlikely so more newsy is so now get off my soapbox more Newsies stuff this week there was a new launch of a,
a very boring Lee names product called the EMV,
SRC in EMV is the name of a joint venture that MasterCard Visa Discover Card Diners Club.
And a couple other companies started so it's a joint venture of all the credit card companies and SRC stands for secure retail checkout.
So they watch the new product this week and,
longtime listeners will remember that most of the credit card companies tried to wash their own check out services so there was a thing called check out by Visa there's MasterCard check out and these guys all wanted their home button on your Ecommerce checkout page,
to have a alternative checkout flow.
That was provided by the credit card company and they wanted to store your credit card instead of having the the retailer store the credit.

[13:22] And they all have kind of you know what those products died they were never very successful customers number adopted them until they have now launched a new initiative,
which has the same same sort of goals but it's not branded for an individual credit card it's it's branded as.
Click and buy and it's you know in it it obviously works with any of the the credit cards and so it's an alternative checkout flow that's really designed that compete with PayPal.
And today they announced their first three retailers head had launched and I think those retailers are Rakuten.
November which is a donation site for a charity and one of the movie theaters at had launched and so this is.
In theory an easier faster more secure way for for customers to check out and if you store your credit card in it on one side.
And you could use that store credit card and any other site that use this flow and they so they've made the flow available for free and it's open so.
And I think it's kind of lame.

Scot:
[14:34] Zoe has a big setup for it being line.

Jason:
[14:37] Yeah well so it's a step in the right direction when I get weight makes way more sense that they have to have a joint product in the each try to have their own product I used to call that.
NASCAR in the checkout where you know all these different companies wanted to put their logo on your check out.
So now you know it's Consolidated down to one there absolutely is a customer benefit like if you know the customer would love to be able to store their payment information in one secure place,
and then be able to use it in any of the places they shop so if a bunch of retailers all adopted this checkout flow.
It would save customers time cuz they could go to a new retailer that they never shopped at before and still not have to type their.
They're shipping address and payment information because it would be stored in the the EMV SRC.
So that makes sense and I think it's a smart play for for the company is to consolidate but here's my problem.

[15:33] The people that should be the best in the world at a checkout form should be the credit card companies and they should you know follow all the best practices and make it as a little friction as possible and therefore isn't that great bike it's very kind of.
A pedestrian middle-of-the-road checkout with a lot of practices that we now know aren't the best.
They make you type every individual field for address and you know we know it works way better to have a single feel than and use like a a Maps API to do a autosuggest.
You know it just it's surprising they didn't have a great check out for a while and then like PayPal.
They make it kind of redundant so the way that these first retailers implemented it. You have to type your shipping address.
Before you select your payment method so you don't have the benefit of this service should be that you don't have to take your shipping address but the retailers are making you type your shipping address before you get to the payment method so.
To me that was just kind of disappointing.

[16:40] So we'll see we'll see if it get some adoption or they do a Gentoo and try to you know I'm sure they're all listening to this and you know we'll take my advice.
Which I will happily give them for free so a couple other little news Tibbetts that I promise will be shorter.
Best Buy hasn't has announced that they're moving to one day delivery for e-commerce so you know obviously,
Amazon send big ripples in the industry by doing one day delivery in Walmart quickly announced they would match and Target matches by using,
store delivery and so now you know we see another big player Best Buy feeling like they're forced to go to one day delivery which I'm sure is going to be.
A very expensive thing for Best Buy to implement so that's interesting seeing seeing more retailers follow suit there.
Today is actually a big day in New York retail,
there's there a Nordstrom store has been a flagship store has been playing there for a couple years and it just open today so Nordstrom open the men's store a little over a year ago in New York and now they have a you know like one of the best examples of there.
Their women store available in New York City and I know that.
The New York retail trade press was shopping at store today and I'll head that very favorable comments about the first day.

Scot:
[18:04] Cool I saw an article that said your Nordstrom was doing all this stuff to improve the brand and into Wall Street just kind of young and I think the Stock's been down about 25% year-to-date
whatever they're doing hasn't been seem to get traction.

Jason:
[18:21] Yeah I mean like for a while the the growth had been in the discount stores which it for Nordstrom is Nordstrom Rack
in the main light stores have been lagging and that you know they finally had to conceive the day the discount stores were cannibalizing the main line stores and you know opening 1 new story isn't likely to really move the needle
this is like by all accounts has a great store it's a risky store because like vemos.
Retail saturated Market in the world for sort of luxury department stores is New York City and you know that most of their competitors have,
how much longer relationship with with the New York Shopper so,
for for local New Yorkers it's going to be interesting to see whether whether Nordstrom is able to entice them,
I see a lot of shopping in New York happens from Taurus and Nordstrom has a good brand so,
I by no means think it's it's not going to work but I kind of think this could be become Nordstrom's best store and it still isn't going to be.
You know a huge economic windfall you know happy story in the stock goes through the roof.

[19:37] Diametrically opposed one of those historic New York department store brands Barneys has been in bankruptcy for a while and we are all waiting to see if they were going to,
be able to emerge from bankruptcy with some sort of restructuring or they were going to liquidate or what the story was.
You know Barney's is a strong luxury department store brand in New York Bike there you know heavily feet up.
Featured in the The Sex in the City TV show.
And you answer a lot of New Yorkers had a strong affinity for the brand.
And then out today that they are not going to be able to restructure so they they sold all the assets to a company called authentic brand Group which is a we often Call ABG.
I'm an ABG the holding company that owns the licenses to a bunch of.
Mostly failed retailer so it's like the Nine West and Nautica and Frederick's of Hollywood and they license out the the.

[20:45] The intellectual property for these these Brands to operators that want to run stores and so they it seems like the intention is to close all the bunnies doors except one in Boston.
And they have already announced that they have a customer that they're going to license.
The brand asset to and that customer is Hudson Bay Company which owns Saks Fifth Avenue so.
Yeah Saks and Barneys would have been you know direct bitter competitors for a long time and you know it.
Clear how they're going to use it yet but like in some way Saks Fifth Avenue is going to try to Leverage The Barney's brand which is.
Interesting but almost certainly bad news for all the.
The employees working in the in the Barney stores and you know people that like had a particular affinity for the bunnies experience.

Scot:
[21:36] How many Barney stores are there again.

Jason:
[21:38] Yes I was afraid you were going to ask me that and.

Scot:
[21:41] Have a uncanny Central would get one of our interns to work on it while I'm fucking in a.

Jason:
[21:46] Yeah if we ever had like notes or or like rehearsals or something like that would be super helpful under 10 I want.

Scot:
[21:54] We do rehearse every show three times so I don't don't get blisters confused by by the don't make it seem like we don't prepare for this thing.

Jason:
[22:02] Got you in my head I want to say at 7 stores so it's not a huge number of stores the a few of them ended up being inserted wackadoodle places like they open the wheel Las Vegas store.

Scot:
[22:17] They're pretty big.

Jason:
[22:18] Yeah it was their big beautiful stores.

Scot:
[22:21] Macy's size in my brain 20000 square feet.

Jason:
[22:23] Yeah but they were like no I think they're like considerably larger like 230,000 square feet.

Scot:
[22:33] This could be good from all again or bad depends on your perspective.

Jason:
[22:39] Yeah
so I think they are like they are an anchor in a couple of miles but there's like something you know that the Manhattan stores were mostly freestanding stores
their first non Manhattan store was like a Chicago store from the 90s I think they have a good store in Beverly Hills
they actually there's two me a doom the mall trying to open in New Jersey
it's called American dream and it's it's owned by the same people that own Mall of America and they've been trying to open the small for like 20 years and it's supposedly,
can a partially open this month but guess who the the tenant retail anchor was supposed to be in that mall.

Scot:
[23:21] Barney's.

Jason:
[23:23] You got it so that's where obviously not happening so that's a yet another setback for for those guys I'm sorry not rooting against them but it just seems like that.
A little bit of a wackadoodle concept in the current market it so definitely you know sad,
to see Barney's go it'll be interesting to see what sax does with the brand you know sex is on kind of turnaround of their own trying to change their fortune and so,
you know I think there's a lot of evidence that.
When's red algae that does not work is to take to distress Brands and add them together so Kenny Mart plus years was not significantly stronger than Sears alone
so what will see if if Saks and Barney's have a different approach.

Scot:
[24:15] Doesn't that don't sound terribly promising.

Jason:
[24:18] I'm super negative on these news items today I should have found some happier news.

Scot:
[24:22] You're grumpy Jason forgot grumpy Jason tonight.

Jason:
[24:24] Yeah also it's not a good week to be a retail brand CEO it seems like they're all losing their jobs.

Scot:
[24:31] Yeah and it's not entirely clear so an interesting one is both the Nike and UnderArmour CEOs have switched over.
Nike +
it's not entirely clear what's going on the lot of them site you know kind of standard just want to spend more time with family and all their stew lot of rumors that there's a lot of meat you kind of stuff happening out there that.
You know that this is one reaction that I have no idea if that's true or not,
eBay's CEO left in September that was kind one of the first ones and he just had a disagreement with a board board
I want some start kind of dismantling eBay and if he wants all the parts to stay together so they the CFO took over there but
I mention eBay because the new CEO of Nike is John Donohue who was the previous to Devin winning CEO of eBay,
from eBay for SAS software business called servicenow and now he's running Nike,
the new CFO is currently running until Under Armour I think president of the US took over on a reminder.

Jason:
[25:44] Yeah internal promotion what's a little interesting they're like I think you're right on Nike so 890 had phenomenal
economic performance and Nike Revenue probably doubled during Mark Mike Parker's rain in Nike so that one didn't feel,
like financial performance-related and there was a lot of controversy around.
Like they're not being a lot of gender diversity in the senior management team at Nike and
you know some sunlight you know not very good policies for treating female athletes in Nike inside I don't know if the cumulative effect of all of that was the deal or if he just chose to leave like Tiana I haven't heard any strong rumors on Nike but it almost certainly wasn't financial performance and Nikes case because they were you know they're frankly doing really well
Under Armour has struggled more and what's interesting there is like the biggest rival for Under Armour has been the North American market and so you know now that the founder Kevin plank steps down I think he still the chairman of the board
ebony step down from the day today and the guy they promote is the president of North America which is the market that that has been struggling so
interesting and nothing else.

Scot:
[27:02] So that wraps up the news for show there was one thing I wanted to mention the news so I think one of the most under-reported and discussed in the industry Market places that I'm excited about
I is the Google marketplace now they don't call it that I think that's part of the problem that the the way they articulate this
to sellers what I would call sellers Merchants if they call it,
Google shopping actions which is a terrible name and then for consumers you you can see it called by on Google the spin around 4
about two years if I recall and it's been on this kind of slow boil and what's,
reason I mention it in the new section is here today right before we got on I got a email from Google shopping saying they were having a flash sale that's like you can't have a flashlight
but look at what they've done is they've gone to all the the sellers that are in the buy on Google program,
I'm in first while they've upgraded the program where I was able to use it on my iPhone and my Apple browser,
I'm on my desktop and it's much easier to use than a
then it has been in previous iterations work Sky Android only intact and to kind of like the Google Play permissions in and.

[28:23] Payment methods do you have set up so it's really good experience so we'll put a link in the show notes to the splash page and I was able to get $40 off of a pair of iPods that had my eye on the new generation of some older ones
so I was just blown away by The Experience got a really nice one page checkout the shipping was very Amazon asking that is Snappy so you know there's there's we talked about on the show about how
Amazon's ads are really threatening Google looks like Google's waking up to this and I'm cautiously optimistic that this Mark this kind of by on Google it is a pretty interesting new and trending Marketplace world and I would encourage our our
books to maybe this experiment without as a holiday item I think it's relatively easy to turn on if you already have you know
you can go to Google shopping list.

Jason:
[29:22] Yep and it correct me if I have this wrong but in my mind this is sort of the successor to what used to be called Google Express rides are there there's both of delivery service but there was a,
Google Express shopping portal where they aggregated all the items that work,
being sold by Google Express and now they have this new portal which is shopping. Google.com which Aggregates all the sellers that are using the the.
Google shopping actions tools to sell products on the Google platform is that am I thinking about that right.

Scot:
[29:59] Yesterday so they had two actions separate then they kind of had it inside of Express then Express kind of as we.
As you know it kind of went away and now they're kind of gotten rid of that brand this far as I understand so they've gone through kind of like four or five iterations here that have been.
Part of the reason I don't think a lot of people are talking about this is it
it is very confusing but now I just want experience I went through was actually really good reggae email and it said there's a flash sale prices were really good it seems like Google was supplementing them took me to a page that was,
coherence and really only shop on Google items that the only other thing I've noticed is you can now if you do a search result
Uber Google shopping I get an Amazon Prime like filter which says you know hey show me only the buy on Google items that are in this market place and what's nice about that is
you know it's got a cart metaphor so I don't have to go to 6 different retailers websites to buy stuff and
and then the flash sale is nice because it also has a bunch of additional discounts to really nail the user experience it still think they need to do a lot on The Branding but I think.
This is good cuz I can Foundation we have the right pieces in place to go do some Brandon that would make sense.

Jason:
[31:20] Yeah I know and it definitely seems like
Google is fully committed to figuring shopping out and it makes sense that they would cuz obviously you know there's a lot of chatter about Amazon stealing ad revenue from Google news so you know if your,
if your Google it would make sense that you'd want to have a viable shopping experience to try to protect that Revenue.

Scot:
[31:43] Absolute cool that wraps up our news part of program and let's jump into some listener questions.

Jason:
[31:57] Questions their questionnaire questionnaire questions.

Scot:
[32:02] Jason you know I don't,
I feel like I've put my thumb on the scale or something but mostly questions are actually in your realm so I'm going to we're going to go into an interview style here.
We usually like to alternate but really miss these are in your room so
jump into a man and you're going to be the guy answering most of them so the first question comes from longtime listener frequent guests Michelle Grant and she says Amazon and Walmart have both have patents around predictive shipping could you speculate on what impact predictive shipping will have on Commerce
we mentioned it in episode 187 but she'd like to get more details.

Jason:
[32:41] Oh. Now I have to try to remember what we said in 187 better than Michelle remembers it and that light.

Scot:
[32:47] You said you were the world's leading expert on it is Farrakhan.

Jason:
[32:50] Yeah I trust Michelle's memory a lot more than I trust must be haven't heard about predictive shipping before like super literally it's
this notion of another way to call it would be in Tissa Batory shipping to say like hey using big data and your
typical trans I assume you're about to run out of peanut butter so I'm going to send you a new jar of peanut butter and if I'm right and you needed peanut butter great you keep the peanut butter and I'll charge your account for it if I'm wrong
here's some super easy way to return in the peanut butter and you won't be charged for it so.

[33:34] It's a specific version of a broader category of experiences that I'll call Auto replenishment right and you know Auto replenishment to me is this notion that,
today my shopping is very inquisitive like if you need peanut butter,
you either go online find the right peanut butter added to your card and buy it or you drive your store find the peanut butter and and pay for it but you you had to take a bunch of overt actions to get that peanut butter
and increasingly in the future there going to be a lot of products that you're going to get implicit lie without having to take all those steps and so,
the ways you might get an implicit product or it might be predicted we ship to you which is what Michelle was specifically asking about.

[34:21] You might have a webcam in your kitchen that's keeping this noticing how much you use peanut butter and ordering pink peanut butter for you when you when you need it kind of like a video version of Amazon Alexa.
You might have a smart trash can that notices what packages you throw away and automatically reorder them.
You might have a fridge that let you very easily tell it when you use the last of the milk or the eggs or something and increasingly you might have a bunch of.
Internet-enabled devices that know when they're out of their consumables right so already you can have a water filter pitcher that knows when it needs a new filter in orders that you can have a dishwasher that orders more soap when it needs it,
and so you know there's a.
Using all of these techniques that iot devices the smart kitchen and the predictive shipping there's a significant amount of purchases that we that we have to explicitly do today that will probably happen in puts Italy in the.
The not-too-distant future incident.

[35:26] Specifically answered Michelle's question I think the cumulative effect of all of this Auto replenishment can have a huge pronounced effect on retail,
so so I've had my team do some sort of.
Studies on you know what percentage of products in a typical Walmart store for example.

[35:51] Would be suitable for auto replenishment and in the answer is it ends up being about 40% of the skews in a Walmart are things that you could.
Reasonably expect to be fulfilled via Auto replenishment,
and so imagine the world was calling five years from now when you never go to the store to get toilet paper or paper towels or peanut butter because through one mechanism or another all those things.
Show up when you need them at your house suddenly the Walmart store is 40% too big and.

[36:26] A bunch of the reasons that you had to go to a store have gone away so the number of visits that you have to that store,
have gone away in the amount of Isles you're going to walk in that store that are you know potentially going to cause you to serendipitous we discover new products and impulse items,
have gone away and so the you know we talked in most markets that like if you can change the market by 10 or 15%.
That really is an inflection point that can dramatically change the whole market and so if.
Auto replenishment can get to 40% like that that would be.
A pronounced change in retail and the way I like to talk to retards about it the way I think about it is you know I used to spend a lot of time at Best Buy.
The 40,000 square foot store 10,000 square feet of that store where designed to sell these things that came on plastic circles called music.

[37:26] And people would buy a new music in some cases every week so you might visit a Best Buy store 50 times to buy music and you probably only shop for a TV every 2 or 3 years.

[37:37] Because you come to that store every week,
you have to walk by the TVs and when you're ready to buy a TV. Most likely buy it from Best Buy so what happens in the world when no one buys plastic circles anymore and you all download your music on Spotify.

[37:50] Suddenly the 40,000 square-foot Best Buy store is 10000 square feet too big and has a huge economic problem and then Best Buy's case.
They they really struggled with what to do with that Gap that was both the traffic driver and you are significant,
square footage in their store they tried a bunch of things today what they mostly do is outsourced that space they sublease that space so Apple buy some of that space Samsung buy some of that space,
Microsoft buy some of that space and they sort of have a Bazaar of of a brand funded displays that I have taken up that space
and they've done some different things to,
replace the traffic they provide lawn services there now weaning into Health Smart Home all these different things but none of the things were
completely successful at replacing the traffic that that CDs wants gave to Best Buy and you know it's very possible
that grocery stores and you know major Mass merchants
will go through this same same Quagmire where where they'll have to figure out you know changes to their business model to accommodate the fact that they're certain kind of products that we're just not likely to,
explicitly shop for at some point in the future do you buy my version of the future at all.

Scot:
[39:11] I do you know the thing I would add and eating you do a,
ask it what you talked you do where you talk about this where you wouldn't when you just drive it people may be saying you know that's really weird like stuff I haven't ordered shows of my house that's weird
but what I think happens is where I need to loosen up to that little bit and use the example of you know 10 years ago people would say never get in the car the stranger now we press a button on her phone and do it all the time
ride sharing apps and don't think twice about it if people put all their food on Instagram and stuff thanks to her behavior changes faster than we give it credit for
and how do you say example of Stitch fix right so there's there's millions of subscribers to stitch fix that are used to the cycle of I get a box of stuff and I return pretty good chunk of it and I keep some
I think that's the kind of the format it would take is you imagine you get all use Amazon cuz that's my
I go to you say yes imagine you just kind of get this weekly box from Amazon and in there,
you keep 60 70% of it and then Amazon's coming to your house so much in your neighborhood so much they don't mind picking up a bunch of stuff I hate you get back convenience factor without
way you would you would really think of it as wasteful I think a lot of people kind of look at in the weather be super wasteful cuz it's actually more efficient.

[40:29] Put more stuff in that box and it's Greener if you could be, the math of that in an Amazon you could actually pass a bunch of shipping savings to you as well
when you stay so I didn't hear you say is just a simple one
and I think the Amazon patents kind of Simply around one of the times I saw was around you know
frequently people in my house on my Amazon account will throw things in the car and just kind of like leave it there for their fries and they won't check out to Amazon could preemptively ship stuff like that to you know so or if you spent a fair amount of time on an item page and items under their not to do that with a high
consideration product like a digital camera
but you know what say you're you're you know you're looking at a pair of shoes they can go ahead and ship you two or three sizes that shoe knowing you'll probably take one and you were probably going to do that exact same
real kind of return pattern anyway if they've shipped that with a bunch of other stuff already on its way it kind of Ride Along Ride Along quote a quote for free or for very little,
there's just kind of like science fiction where all the devices are ordering for you but there's kind of simpler stuff we can do in the interim to get there.

Jason:
[41:39] Oh for sure and I would even say it like,
there's lots of signal the retailer can use to inform that prediction and you met you know the browsing signals that you mention the the stuff left in car that the actual purchase history but,
like let me give you a scenario that's even easier so what happens when Kroger buys a popular app for tracking your calories online and they now know for a big chunk of their customers
like what they ate at every meal because you logged your food consumption into your diet at right
so now Kroger knows not only what you browse for and what you bought but actually when you consume it and so they can you know super accurately,
predict when you need more of those items and it it you know it's not black magic or anything like there's a gentleman reason that some users would want to tell Kroger when they use those items,
because I got some some benefit for that and I guess they're one of the thing I throw in there is predictive shipping doesn't.

[42:44] Automatically mean to your house so there's a flavor predictive shipping that in essence is already have and it happening some of the Amazon patterns for predictive shipping,
actually are proposing that they would predict that we ship popular items
to the basement of your condo building our apartment building right so I can predict like
I can aggravate the predictions for you know the 50 people that live in this building and I can
Amazon can we space in though in the basement of that building and they can stage the stuff that that buildings most likely to buy in the basements and then when they get ordered the delivery cost is from the basement to
the the unit instead of from the Fulfillment center to the unit right so a flavor predictive shipping is.

[43:33] Predictably staging the stuff closer to the consumer and I would argue Prime now is sort of a version of that already where you know they have
they put them in centers that are several hours from metropolitan areas and those those filming centers have a million items and then they take the 60,000 items that they're most likely to sell to that metropolitan area and they put that in a smaller Warehouse that's a 30 minute drive from
most of the residents in that City and you know increasingly
they might stage even more popular items more closely the customers to enable the one day delivery in all these other services so I I feel like baby steps in predictive shipping is kind of staging items closer and I do think it's totally realistic that
In Our Lifetime you know there's white I did it just doesn't make sense that you should have to stress about running out of toilet paper.

Scot:
[44:25] Yes
it's going to be one thing the e-commerce industry delivers to the world cool our second question comes from Holly Marie Pfeiffer and it says what's the future look like for personalization with ITP cracking down on Safari and talks about Google being closed behind and restricting third-party cookies.

Jason:
[44:45] Yeah well so I'm have to interpret this question.
Partly because there was a thing called 3rd party cookies and they mostly are already
not allowed so you know a cookie is a little digital footprint and it gets laughed when you visit a website and it can store some data,
that that website uses about you right and so for a while it was possible to four.
When you visit us a Retailer's websites a walmart.com
Walmart could have permission to go look at a cookie that shared amongst many websites and that was called a third-party cookie
Vera Bradley security reasons browsers don't allow that anymore so walmart.com can only see cookies that are designed for walmart.com and no other website can see those cookies so it said that kind of.
Personalization has already tightened up but there are lots of other ways that browsers try to identify you and share information about you
and I think Holly's main point is
the internet is kind of cracking down on all of those ways so there's a thing called browser fingerprinting.
And essentially you know I can ask the browser.

[46:12] For thousands of settings that you have set in your unique browser and your combination of settings for all those settings kind of.
Equals a unique fingerprint that's going to be different than almost any other user on the internet and so by.

[46:27] Asking your browser all those questions I can create a unique fingerprint for you to identify you uniquely Scott even if you delete all your cookies and so there's a you know a fair amount of.
Advertising based personalization on the web that leverages these fingerprinting Technologies,
and increasingly the browser is not letting you asking all those questions because they realized that it was being exploited for for privacy reasons,
and by default the browser isn't storing cookies at all or is much more restrictive than its privacy policies then then they used to be and so there are a lot of us that feel like,
a lot of the ways that a marketer would have leverage third-party data to improve.
Their ability to Market to you when you're in a particular website are all things that for a variety of privacy reasons are,
going away and they're going to be more restricted right and so you know today when you go visit a website you visit Walmart Walmart knows everything that you told Walmart about it but Walmart can also go to.
Axiom and Epsilon and all these third parties and buy a bunch of extra data about you that they could potentially use to Market to you,
and you know there's probably like.

[47:47] Nearer than further future when marketers aren't going to be allowed to apply any of that third-party data to you so they're only going to be allowed to use data,
about you that you had explicitly provided to them and and they they have disclosed their collecting and what they're doing with and so,
it does change a bunch of marketing tactics that does change.
Did the palette of personalisation options that you have available but frankly like I would argue that we are doing an extraordinary crappy job of personalizing experiences
to all the data that we have access today in to the fact that some of that data might be less accessible to us as marketers in the future
like like,
you know do a great job with all the data you have before you you're crying about not having access to more day that's why I feel like there is a huge opportunity to dramatically improve personalization
you don't even with just first-party data and so I personally don't view it as a a disaster
that the sort of wild west of third-party data is is likely going to go away.

Scot:
[49:02] Call Melinda secret time time so we'll probably maybe do the short version of these
this next question comes from Jeff Vogel I saw Jason's question to Toby about performance and pwas do you see them actually sticking I know they are hot right now but how many pwa either of you have on your phone
of those besides Amazon how many do you use seems like something that works for the Amazon to Nordstrom's the world but do you see it as a mid-market reality.

Jason:
[49:33] Oh Jeff it's so cruel. Just short answers and then gives me a juicy p p w a question.

Scot:
[49:41] Take all the time you want it's our podcast.

Jason:
[49:45] Yeah yeah that's got so so first of all the the question he's referencing is the founder and CEO of Shopify did a kind of ask me anything on Twitter,
that's Toby and I took the liberty of asking him a question about you know is there any plans to dramatically improve,
Paige performance,
on Shopify sites and specifically of Shopify was going to move to something like Progressive web apps and Toby was nice enough to give a video response to my question and he said we're absolutely,
doing major evolutions of our performance right now so stay tuned for you no big announcements about us optimizing our performance which candidly is a problem with Shopify it's not a particularly.
Bass performing e-commerce experience at the moment
so glad to hear that Toby is committed to fixing that and I floated pwas as one of the primary ways you would do that and Toby didn't agree with me like so he's like we support pwa,
but that's really not the best way to get performance so this requires like a slightly deeper dive.
Jeff I suspect the way you're thinking about pwas is exactly backwards right sappy wa stands for Progressive web app.

[51:07] And it has this unfortunate word in it app and so when most people here that they go oh,
pwa is a replacement for Native apps and what you would do is you go to a website that's a pwa and you'd quick save on my homepage and now you have an icon on your phone that you can click.
Anytime you want to do lunch this pwa and you know he he's referencing that guy shike aren't only really big companies going to be able to convince people to save the pwa is to their homepage.
And here's a funny thing what a pwa really is is it's a best practice way to build a mobile website.

[51:45] And you never have to store it on your homepage it simply means if starbucks.com is built as a pwa when you go to starbucks.com from your mobile phone.
You're going to get a highly mobile optimized experience that's likely to load much faster be perceived as welding Fastener and support the very latest.
Mobile capabilities in your browser so it's using your browser to deliver a great mobile experience native apps,
are indexed by Google so if you do a search on Google you're not going to get pointers to the,
the interior content inside of a native app but a progressive web app is a website so it all of its content is indexed on Google you can get a result on Google click on that result and it'll take you right to that part of the progressive web app.
It just so happens that as an optional feature of progressive web apps.

[52:37] If it's a app if it's a website you use a lot you can save it to your desktop in or to your phone home screen and then there will be an icon that you can use to lunch at but you're really just watching.
That Brands website and so I actually think.
Pwa most benefits the not Amazon's of the world Amazon is about the only retailer that successfully has God than 50 million consumers to download and install their app like almost no other retailer can get a native app installed on a lot of.
Devices Amazon can so if you're not Amazon and you want to Rich mobile experience.

[53:15] A pwa is the way to go right now so I at the moment disagree with Toby I think.
Pwa is are much more important for mobile performance then apparently Toby believes they are.
Time will tell there are a bunch of retailers that have launched pwas and a reporting dramatically better.
Performance and therefore business metrics as a result the example I use a lot is in the US Starbucks has a mobile app and super successful.
But as they've expanded all these other countries they didn't rewrite that mobile app they built a pwa so in China the way you would do mobile order and pay the way you would do Starbucks pay is through the pwa website that Starbucks belt,
and they have built a a pwa version of their website in the US now and you can try it and it basically it'll mobile web browser gives you all the functionality.

[54:13] Previously you you would have needed an app to get so I think it's a really good experience.
You don't see tons and tons of deployments right now because they're frankly really hard to build them so they're expensive to build.
I'm in a ton of retailers just spent a bunch of money building building a responsive design website and saw the last thing they want is Jason Goldberg to fly in and go your responsive website sucks you should build a really expensive pwa to replace it right and so.
Quite frankly there just a lot of retailers that aren't in cycle on.
Making that kind of investment right now but almost every retailer that is having to make a new investment in their mobile experiences.

[54:51] Is adopting pwa in the first crop of those that did are getting great performance so.
I'm actually curious to have a Toby's a super smart guy.
Cheers to have a longer conversation with him then you can have on Twitter to understand why she's not as bullish but my.
Sort of skeptical suspicion is Shopify just isn't particularly well architected to.
Replace the webstore model with a pwa web store and you know they built their own Paradigm they they have this development language called liquid and Toby obviously loves
the stuff that he built so he believes the fastest way to get a mobile website is a better implementation and liquid and they support pwa is kind of a bolt on but not really is
coordinated technology and so I suspect part of Toby's hesitation is that his architecture just doesn't support it as well but,
hopefully I'll get the chance to have a deeper die with him and then we'll find out.

Scot:
[55:58] Cool that's a good tie into this final listener question this comes from Carrie and I'm not going to say carries last name cuz I won't say it right so will call Kerry k
any new information regarding with a Dobby is doing with the Magento platform
and kind of a it's a two-parter here as we're trying to go fast and then this is one you can do really fast what's your brief take on the current status of all of the Commerce platforms.

Jason:
[56:25] Yeah so that it's a better time than you might imagine because I'm like Shopify Magento is kind of all in on Progressive web apps,
like here here's a kind of my Readers Digest on the Adobe and Magento first and then the overall landscape later
show magenta was a super popular e-commerce platform it's been deployed millions of times it's you know most people that the plated didn't pay for it and it's you know open source on-prem solution and that was called magenta 1.0 so there's
Tennessee. They're they're still running magenta 1.0 there's a you know even more sites that installed magenta 1.0 at one point and then just kind of abandon their business right so,
it's been a super popular platform for a long time in the last three or four years if you were small business that wanted to do lunch and e-commerce site you were Louis less likely to pick.
Magenta which is hard to install and host and all these things and way more likely to pick Shopify so Shopify his gain way more traction while I would argue Magento has lost a lot of traction with small businesses,
but while that was happening,
Magento didn't stand still they built Magento 2.0 which was much more modern architecture for an e-commerce platform it was better in a lot of ways.

[57:44] And only one piece of bad news Magento got very few people to use Magento 2 and very few of the,
the the magenta one sites have migrated to Magento 2,
but Magento 2 is better in most ways and today Magento 2 is one of the platforms that had the best native support for Progressive web app.

[58:10] So
well they don't have like Magento is kind of A Tale of Two Cities they have a long in the tooth old e-commerce platform that that has a lot of flaws but has a huge install in loyal install base,
and they have a new platform which is much better which supports much more modern standards and better security.
And they don't have a lot of traction with it yet and then you know when they found them in that circumstance they got bought by Adobe.
Which you know it has a huge investment in content management this platform called Adobe experience manager AEM.
An AEM scomar strategy was to partner with e-commerce platforms so you know what a job you would say is.
Run AEM in IBM websphere or run a.m. and sap hybris together and we have these design patterns that let you run these two super you know expensive complicated pieces of the software together.

[59:12] So at the moment.
I would say Adobe has not merge those two strategies like they now that they own Magento they they have a strategy that says hey run AEM and Magento together.
Like we used to talk about running hybris or sap.
And like I don't think they've got a lot of traction on that like it it frankly doesn't fit because in Magento is cheap and then in a.m. is expensive so if there's not.
Like a huge amount of overlap of someone that wants those two platforms.
And then separately they have this pure magenta solution which is hey you don't need a Content management solution adopter magenta to you know Embrace Progressive web apps and embrace the future and its really great solution so,
what we're all waiting for is Adobe to kind of reconcile those two strategies and say like hey how does
AEM fit into the Magento 2 pwa
World am is not very good at pwas but you know with Magento is selling their vision of the future there they're talking heavily about pwa so
is there in a little bit of an awkward place right now and we're all waiting to see how they they reconcile those those two pads there's there's a number of ways they could do it
and frankly adobe's acquired a lot of other Technologies in the past and ultimately been able to do a pretty good job of weaving them together.

Scot:
[1:00:38] And then the second part of that question was some of the other platforms you've spent a fair amount of time on Shopify and Magento maybe throw was still a little big conversation there and then walk up
to Salesforce Oracle sap platforms.

Jason:
[1:00:57] Play my one sentence answer is the state of e-commerce platforms right now is.
Convoluted right so that you know that the entry-level small business platforms of choice Magento and Shopify and as I've already mentioned Shopify phenomenally gaining traction,
and very low low risk easy implementation a lot of things going for it Magento
1.0 open source not so much not gaining a lot of new users One Step Up from that they're their platforms that are you meant to be like slightly more Enterprise friendly like you mentioned Bigcommerce
and I would call you I would say Bigcommerce as a kind of.
Stayed flat and Shopify his kind of successfully moved into Bigcommerce is space so they have a new flavor of shutters not that new now but.
A newer flavor of Shopify called Shopify plus which kind of targets directly the Bigcommerce is of the world which were maybe like one step up Market from.
From Shopify Bigcommerce is going to support more things like B2B workflows and things that that Shopify probably doesn't have yet they're a bunch of.

[1:02:11] Newer platforms at the next step up that don't have very big installed bases but they're all these platforms like,
mozu and.
Commerce Tools in Alaska path and you know a whole set of platforms that each have some pros and cons but just don't have a huge installed base.
And then you get up to the what what was the Big 4 which platform is most likely to be used by my clients and be used by it like big Enterprise clients it was demandware which is now Salesforce Commerce Cloud which.
Is doing really well has a lot of traction and you know they're probably doing a really good job of evolving the platform.
And then there are these three on-prem so in that that pop on his cloud-hosted platform.
Dentistry on Prem platforms that were really big amongst Enterprises there was IBM websphere Commerce which I didn't actually sold and you know now.
Is a little bit of forts platform there's Oracle atg and there's sap hybris and I would argue that all three of those platforms have wildly lostine.
As users have seen how expensive and high-risk they are to install and how long the installation takes and how much of that experience you get out of these smaller cheaper platforms for a fraction of the price.

[1:03:39] Sap hybris has a bunch of features that are not in Shopify plus but once you paid $10,000 for a year of Shopify Plus.
It's really hard to spend millions of dollars and wait 9 months or 12 months for implementation of,
of sap hybris so I would like say at the moment the Enterprise platforms are really kind of tanking,
it remains to be seen what what will replace them do man wear his you know star Salesforce Commerce cloud is done by far the best of those Enterprise Solutions,
and the the small business guys are growing up with their clients and so you know that the shopify's in the world have have many more Enterprise clients now that some of those.
Originally small businesses like Warby Parker you know have gotten bigger on that platform.
And not you not argue there's a bunch of new technologies that all the it guys like that are micro service-based and all of these new Frameworks,
and it seems like that's what all the customers want but like.
No one platform has kind of won the majority of users on that platform so at the moment it's a it's a very fragmented market and it's it's difficult to pick a winner so it's to be honest not the best time in the world to pick a new platform if you don't have to.

Scot:
[1:04:58] Yes some of the api-based funds called themselves headless which I think is bad Ben marketing unless it's Halloween.

Jason:
[1:05:05] Yes and pretend most of like there's not perfect overlap but most of the Headless systems or API BAE systems are.
What we would call Micro service pay system there are ways to be headed west without microservices but that's getting in the nuances that we probably don't need to get into on the show.

Scot:
[1:05:25] Can you be headless without microservices but still do pwas without third-party cookies and predictive shipping.

Jason:
[1:05:34] I was going to say yes till you threw in.

Scot:
[1:05:37] Cool started to sound like a little word salad which means it's probably time to land the plane here.

Jason:
[1:05:46] Yep if I'm totally confused anyone and you want to ask me five questions feel free to hit us up on Twitter or Facebook page,
you know is if we added value on the show we sure would love it if you jump on the iTunes and get us that five star review where one of the best reviewed e-commerce podcast on the web and frankly we'd like to keep that status and I need your help to do it.

Scot:
[1:06:09] We hope you enjoy this episode of industry news and listener questions.

Jason:
[1:06:15] Until next time happy commercing.