The Evolution of Ecommerce with Jon Feldman

Businesses are always looking for the most effective strategies and tactics to create the best customer experience possible, and in the world of ecommerce, that’s getting harder every day. We wanted to dig into some of the trendiest ways ecommerce brands are weaving their way through this maze, so we invited our good friend Jon Feldman on this episode of Up Next in Commerce to show us the way.   

As a senior manager of product marketing at Salesforce, and someone who talks to commerce business owners and operators on a daily basis, Jon knows a thing or two about what’s on their minds, the challenges they face, and the questions they are dying to get answers to. He’s also seen first-hand what kinds of major and minor changes ecommerce companies are making that have had the biggest impact. So how are small website tweaks having a ripple effect on call centers? What will happen to the customer journey as commerce moves to the edge? And what kinds of technology and platforms will brands need to lean on to win across a new ecommerce landscape? Find out all of that and more right here. 

Main Takeaways:

• On The Edge: Commerce has already shifted from retail stores to store-specific websites. Next, we’ll see more of a migration to shopping on the edge, with commerce happening on content websites and away from the traditional retail site. This sets up a question of customer loyalty and trust that brands have to answer and prepare for.
• Know Who They Are, Not Where They Shop: As ecommerce becomes more distributed and marketplaces and virtual shopping experiences crop up, brands need to accept that they will have less control over where a customer finds them or how the brand is represented. Instead of trying to funnel people to a specific site, make sure that however a customer ultimately finds you, when they buy your product, the experience with your systems, shipping, customer service and everything else meets their needs.
• Opportunities Abroad: The world continues to become more and more interconnected, which also means that the opportunity to spot product trends abroad and introduce them to a “new market” in another country is also shrinking.. Luckily it's easier than ever before to market and ship products around the world, so you are probably only a few backend adjustments away from being able to expand across borders.

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

---

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

---

Transcript:

Stephanie Postles:

Welcome back to Up Next in Commerce, this is your host, Stephanie Postles, co-Founder at Mission.org. Joining us today is Jon Feldman, a senior manager at Salesforce who works on Commerce Cloud. Jon, welcome

Jon:

Stephanie, great to be here. Thanks for having me.

Stephanie Postles:

I'm excited to have you. I think before we start, because we haven't had many Salesforce people in the show, I was hoping you go through your background, what led you to Salesforce, and what you do today.

Jon:

Yeah, absolutely. I started doing internet commerce at ATG back before Oracle bought it in like 1997 in their professional services group. I was at ATG for eight years and I did implementations around the world, honestly. I was in New York for a while, West Coast and East Coast, and that was super awesome. I met a ton of people and learned a lot about how people use commerce systems. After that, I went and did a four-year stint at a consulting company, doing the same thing. I guess, it's not as exciting. And then I went to Restoration Hardware for four years. I was the senior director of IT/ecommerce, which was really rad, until I got laid off, which was a super bummer.

Jon:

And as I was trying to figure out what I was going to do with my career after being laid off. I was like, "I really don't feel like there are a lot of jobs that are senior directors of IT/ecommerce in a lot of places." And so I thought I'd try marketing and I switched over to product marketing. And I've really been enjoying it ever since. I've been at Salesforce for about two years now and talking all about the commerce product. It's a lot of fun, honestly.

Stephanie Postles:

That's great. What does the best day in the office look like to you?

Jon:

Best in the office. It's interesting because we're at a big evolution point for Salesforce marketing, I think, particularly for Commerce Cloud. The company was built around physical events. For Commerce Cloud, we had three big stations every year, we have the National Retail Federation, which is coming up in January, we have Connections in the middle of the year, and we have Dreamforce at the end of the year. And those are our big opportunities to talk to clients. And of course, with the pandemic and travel stopping, those have all gone away, which if you are a company that sells software, that's problematic because you need to be talking to customers to generate leads and keep the machine rolling.

Jon:

And so, because of that, we've been trying a lot of stuff with video, and my job is really around how we talk to customers through video and how we continue to generate a conversation in an audience with potential customers and existing customers when we can't see them in person. And so for me really fun days are days when we're working on new video stuff. I think that at a high level, a lot of the video that's created is repurposed webinar, and it is just like, here's just a bunch of stuff.

Jon:

And for me, the fun stuff is how we can modernize the format and talk to customers in a way that they're like, "Wow, this is actually interesting and engaging," and not like, 45 more minutes on payments. Anyways. So that's what a good day is.

Stephanie Postles:

Awesome. So on the topic of video, a lot of different companies right now are talking about that as well, about what they're leaning into in 2021, they see a lot of opportunities there, not only with YouTube, but also TikToK. What are you guys seeing in that area?

Jon:

Taking a step back, I think that modern video is YouTube. YouTube is the number two search engine on the internet. And so there's a format to YouTube, which is 10 to 15 minutes long, really clear call to action, and then there are like a million genres underneath that. And I think that as we think about it, it's, how do we get into a format that is more fun and interesting and engaging, and that has a clear call to action? Yeah, I think for us, it's really about, how do we modernize the format? How do we engage on video in a way that isn't just a 45-minute program on a topic.

Stephanie Postles:

When you're talking to customers every day, what are some of the trends and themes you're hearing from them right now and maybe how they're thinking about next year?

Jon:

Yeah. In my role, making all these videos, we talk to customers all the time because Salesforce doesn't want to make a video unless there's a customer interview, which I think is really smart because at the end of the day, customer's the one who have the interesting stories. Obviously, a lot of a lot of what we talk about, it's the impact of code and retail sales closing, or things being pushed to digital because if you look at the numbers on their own, they're pretty remarkable. I have access to Salesforce numbers, and its biggest Cyber Week doubled. Some of our biggest customers are seeing 500% of what they did.

Jon:

And that's interesting, but I think that it hides some of the really interesting storylines. I think it's easy to talk about the numbers, but one of those common things we hear from our customers is that COVID has pushed a lot of people online, it's increased the volume of their business, the velocity is much higher, and that in turn has exposed a lot of problems that they've had in their supply chain. And that little things that weren't a big problem had become really problematic as the scale goes up. And that's manifesting in everything from more attention, to deflecting calls from call centers, because we talked to Hibbett Sports and they were getting a ton of questions about the order cancellations.

Jon:

They implemented online order cancellations and it had this huge impact on their call center. Even though obviously you're losing revenue when someone's able to cancel the order, the impact of taking that pressure off the call center was worth it. And that also manifested on the front end where we find that-

Stephanie Postles:

Oh, interesting.

Jon:

The thing which I think is really interesting about those call center things is how there's always just little things that make enormous changes in the volume. I remember Restoration Hardware, one of the big efforts we had was to just put dimensions to the objects on every product display page, because at the time, the biggest three reason for returns at Resto was that stuff wouldn't fit through the door. And we weren't telling anybody how big it was, so you'd show up with this giant couch that was designed for like a palace in France and it wasn't going through a US standard door. Yeah, really interesting stuff along those sides.

Stephanie Postles:

Yep. We had someone previously on who talked about spotting bottlenecks, and it reminds me of that. Maybe people aren't looking at their customer service department or figuring out... There's so many things to look at right now. So many companies are saying their models were breaking and they had to rebuild things from scratch. And I think taking a step back and figuring out what are the biggest bottlenecks, like you guys were doing with your one customer, how they were able to look at their call center, is a great first step. That's interesting adding order cancellations online.

Jon:

To your point, what I think I've seeing through a lot of this is that companies are taking a broader view of what the whole customer experience is and looking for ways to work around some of these bottlenecks. Intuitively, as somebody who's done a lot of these implementations, I think that oftentimes those bottlenecks are in places where systems touch or there are like decision points and financial trees. You don't have to turn the whole thing off, but make changes that make it easier and faster for customer to go through it. It just takes stress out of the whole organization.

Stephanie Postles:

So what other trends are you hearing from your customers right now? And do you think these things are here to stay, or do you think the world's going to pivot back to where it was before and some of these are going to be short-term fixes that maybe aren't needed in a longterm?

Jon:

It's a really interesting question. I was talking to another customer, they were bringing up this really interesting point that, 2021 comps are going to be a really tricky thing to work with because the market was so crazy this year and next year, you're going to have to figure it out. You're going to have to say, "Hey, was the push online to COVID forever or short?" To your point. The other thing about what I think the future is going to hold and where commerce is is that, originally, a lot of commerce happened at a retail building, And that made a lot of sense, you own the customer that were in your store, no distractions, ready to go. And then a lot of stuff moved online and customers gravitated towards your website, where you could still have a very curated experience and it could still be on your terms, make everything happen.

Jon:

I think that as I look forward, we're going to see more shopping on the edge, which is where products are going to be more deeply integrated at the content sites or in marketplaces, or you're going to be finding places to shop which are not the traditional website. And I think to the question, I think that then becomes a really big customer loyalty question of like, if I'm on a content site and I see an ad for Home Depot, do I trust that it's really Home Depot? Do I believe Home Depot is going to fulfill? It brings that whole question of, what is my relationship?" And image of that vendor up And, "Am I going to transact with them outside?"

Jon:

But internally, we think that something like 15% of commerce next year is going to happen at the edge. So I'm really excited to see how that goes.

Stephanie Postles:

That's interesting. So how can a brand prepare for that? Like you said, a lot of these brands right now are thinking about community building and how to build up that loyalty. There's so many new DTC companies popping up, so there's a lot of competitions. They're all trying to figure out how to really get ahead. So how can they prepare for that if you're saying now it might start turning into shopping in other places to where you're not going to see the brand front and center anymore?

Jon:

Totally. And it's interesting because I think a lot of people approach that as a technology problem, like, "We're going to buy a bunch of software and it's all going to be magic." My personal belief is that technology is an enabler, but it doesn't actually solve any problems on its own. And so the specific things that I would, if I was to presume to tell someone what to do with their business, it would be that, "I think you really need to focus on what your customer is and how you can build loyalty and build a customer experience that is so great that they would prefer it." I think that if you look at Amazon, arguably the shopping experience is a disaster, but the fulfillment is so strong that you have trust that if you're able to find whatever it is in that haystack, that it's going to come to you and it's going to look largely like the picture has.

Jon:

I think that if I was thinking about going to DTC and I was thinking about how to do that, it's about really knowing who my customer was, what they liked, and where to meet them. Because I think the relevancy of where your product shows up and how that customer journey ties into your system relationship with that company are going to be the most important things. Because ultimately, we've lost control of the presentation, it's owning the customer and just being wherever they are, because then that's the consistent thing, is you are where they are. Not that you're always on your website.

Stephanie Postles:

That's interesting. When you're thinking about shopping on the edge, is that referring to Amazon or is Amazon excluded and it's more talking about newer marketplaces that are popping up, like the Fairs of the world or Italic or places like that where maybe they're sourcing products, or is it all of it?

Jon:

I would argue that Amazon to some degree is the edge, their marketplace is this... anyone can put stuff in there, so your brand has to compete there against the knockoffs and events, that similar stuff. So I think the edge is marketplaces and a host of other non-traditional stuff. The single sourcing stuff, I'm not as sure about, white labeling stuff I think is slightly different. When we talk about it, we really mean that, hey, your products are just going to be in places that you'd never expected. And I think honestly, we think a lot about content alongside content when we talk about it.

Stephanie Postles:

Yeah. You were just mentioning Amazon and knockoff products, and one interesting thing, which I didn't know, maybe it's because I don't have an ecommerce company at the moment, is that you have to win that Buy Box. Did you know this where you have all these competitors and you actually have to win out the Buy Box and be able to like brand gate your brand to make sure that no one else can show up under there? There's so many things like that I think a new commerce owner would not really know until they start figuring out that people are now showing up under their listing and there's fraudulent people there. It sounds like a lot of times, you find out or see things going wrong until you learn how things actually work.

Jon:

Yeah, totally. I didn't know that, but it doesn't surprise me. Retail has always been monetized. Like if you want a good placement at the grocery store, you're certainly paying for it. None of that stuff happens by accident. No, it doesn't surprise me. I think that it all comes back to the brand management. It speaks to how much of a pain in the butt it is to curate a brand, even if at the edge you still have to be controlling it, you have to be really mindful of what's showing up on your PDP on Amazon and who they're showing next to you. Yeah, it's really tough. I think at the end of the day, the control you have is the loyalty, because that transcends the market that you're in.

Jon:

Because if you're buying like an LED light on Amazon to like do podcasting, you've got 62 million choices, 90%, they're all like the same product with different brand names on it. There's no way to stand out in that marketplace. Even if you have won Buy Box, I think it's loyalty.

Stephanie Postles:

Yep. Are there tools right now... If this is going to be the way of the future, buying on the edge, are there any tools that curate where you can sell things, how things are going, all in one place for a business owner, so if it does start moving to that model and maybe their product is now selling in like 50 different areas... I'm just imagining the chaos of trying to keep track of pricing and orders and even knowing where you're showing up and what's happening there. Do you know of tools for that?

Jon:

Yeah, it's interesting. Certainly, at Salesforce, we have some ideas and tools. We have some aggregation tools that make it really easy to plug your existing Salesforce Commerce Cloud catalog into other places. But I think ultimately, when you think about a commerce solution for a company, it's really a platform. Because what you're describing, it can turn very chaotic. I'm selling on 50 stores and I have 50 skews and they're all going to different order management systems, and that all gets crazy. Personally, I think the architecture to do this is to have all of those places centralized into a central order processing, central order capture, central service thing, so that no matter where it is, even if...

Jon:

I think people go into this thinking that, "My customer is only going to shop from me on one channel," but they may be buying something on eBay and they may be buying something on that content blog. How do you link those two things together? So the architecture I think is always the central order capture and service thing and that you have either APIs or integrations that allow you to then push that content in a way that makes sense onto the places and appears at the edge. But I think that all the capturing transactional stuff, if at all possible, runs through your engine. I mean, obviously the marketplace is going to want to own it, but it's not all marketplaces.

Stephanie Postles:

Yep. We've just finished pulling together a top trends of 2021, and we're talking about platforms, so it's relevant. We've talked to a lot of companies where they've mentioned that they outgrew their platforms. And so one point that we were making in the article was that a lot of companies right now are seeing the ability to scale a lot quicker than maybe prior to 2020, just because so many people were pushed online, new demographics are online. You can grow a lot quicker, at least this year, than maybe prior years. I'm sure you guys see this as well, new customers potentially coming your way.

Stephanie Postles:

How do you know they're ready for Commerce Cloud? What kind of problems are they encountering with their current platforms where you're like, "Oh yeah, you've outgrown it," because I think I've heard this at least 10 times from guests who've come on the show, like, "Well, things just started going wrong and we knew it," but they didn't always have details. It was just like everything was going wrong. So I wanted to hear some from you guys, what are you hearing?

Jon:

Well, let me take off my Commerce Cloud hat, because I think it's an interesting question because I actually think that that's a platform agnostic problem. I'd love to say, "Oh, you solve those problems on Commerce Cloud." I implemented ATG for 15 years, and my belief is that enterprise software is elastic, can do anything. And then it's implemented and then it's like in cement and it's very inflexible for a lot of it. And I think that companies outgrow these when either their original implementations didn't model their business processes completely or didn't anticipate the change that they would have to use.

Jon:

And I think that what happens is that if you're a business person within an organization and you need to like launch Wishlists and you're an IT person who hears this and you're like, "Wishlist, that can take me a full year to do." I think those agenda, those feelings that, "Wow, this platform is fundamentally broken." So don't blame this author, it doesn't really matter. I think it means that you need a new implementation and a new truing of your business processes with your IT processes so that what you're putting onto the internet is once again in sync with what you're doing and what your dreams are.

Jon:

That's what I think when people say they're outgrowing, there's so much friction getting just their basic business processes done that they feel that they need to just throw it out and start over it. And I empathize with that, I think that there are truly some systems regardless of the software where just it's better to start over.

Stephanie Postles:

Yep, that makes sense. Another thing that we talked about in the report was about these demographic changes that are coming and how many more people are online. How are you thinking about that right now with meeting those people? Some of them are brand new with ordering online, they're now getting used to it and they're probably pretty sticky going forward, but how are you guys thinking about these new users online?

Jon:

Yeah, it is a really interesting question. For me, an interesting analogy is fitness. In a previous life, I was also a fitness instructor that had small boutique fitness. And you can arguably do everything you can in a group setting at home. There's really no magic, there's no secret thing except someone's yelling at you and telling you what to do. And you've had all those fitness places closed and now everything's at home and you have this huge proliferation of home fitness stuff, Peloton, Mirror, Apple's coming out with a product, and all that's really rad. But the question is, and I think it's exactly the same with the fitness as it is with ecommerce, how sticky is that really?

Jon:

When the fitness studios open up again, are people going to rush back to them? Is there something inherent about that in-person experience that people are going to go back to no matter what? As I think about that, my conclusion across retail and fitness is the same, which is that some people really miss that in-person component, regardless and are going to do it, and are going to go back. But I think that even with that chunk of people going back, it's not going to be, at least initially, be the same level that it was before, because the internet is the new technology. It's something that in the last 20 years is new, and I think is going to have a longterm impact now that everybody's been forced into it for a broad array of daily services that it's going to be stickier.

Jon:

So I don't think it's going to be quite as crazy. I think the 2021 comps are going to be lower online, but I think it'll still be higher than 2019.

Stephanie Postles:

Yeah, I agree. We just had Stitch Fix on the show, and it was really interesting because they were talking about starting to at least test out or try out GPT-3 and how they're focused on figuring out ways to process the natural language, which is what the technology is for, because a lot of these new users are coming on and they're typing very formally, they want a formal answer. They want to make sure they get a response in the way that they would expect it. And so Stephanie from Stitch Fix was just talking about how she thinks about personalizing the messages and reacting to the user depending on how they're typing in their question, how they're asking for things, to make sure they meet the user where they're at.

Stephanie Postles:

Which I thought was a really interesting take on personalization and a use of GPT-3, which I hadn't really heard of, at least in the world of ecommerce.

Jon:

It is. It's really interesting. And I would suspect that that's different from vendor to vendor that some people... Stitch Fix will probably see some of that more formal stuff as more professional people are trying to put together AI-inspired wardrobes. And other places, I could see... I'm stumbling around trying to say it's interesting, because all of those are technologies that ultimately will replace the interaction that you would have with a human. I worked at Restoration Hardware for a long time, and so this idea of human curation being something that you can't replace with AI, that there's something inherently wonderful and irreplaceable about that, the person who like knows the product line back and forth and is able to work with you to help you identify it.

Jon:

I didn't buy the full Resto thing where it's like... There's no way to do it all in technology, because I don't believe that everybody wants that kind of transaction every time, but in these situations, it's really interesting to see how people are trying to make up for that, that human curation, human taste's thing with AI on scale now. Oh, it's fixed, it's obviously doing great.

Stephanie Postles:

Yeah. To their credit, they always keep a human stylist to finalize things and make sure that they're still choosing things from a human perspective. So they do do that, but I have also seen it go very wrong when most recently I was calling a phone provider that I'm working with for my new internet in Austin, and they have it where they have the little robot pretend typing, it literally sounds like-

Jon:

Ugh, that's horrible.

Stephanie Postles:

I'm like, "What? Don't look try that." I know it's a machine, but when you try and add that extra emphasis to try and improve, I don't even know what they're doing, I'm like, that actually makes it worse, I'd rather you just tell me, "This is a robot. If you don't want to talk to a robot, let me know." Or something.

Jon:

Or you use your experienced people. What are you doing? We know it's a robot.

Stephanie Postles:

You ain't typing, you're not fooling me, and anyone that you do fool, I feel very, very sorry for.

Jon:

Yeah. It's interesting too because it's almost like we're going to address that real person thing by pretending, by trying to... Because I think no one's surprised when they deal with an AI thing, they're not disappointed, so why pretend that there's a person behind it?

Stephanie Postles:

Yeah. That was my biggest learning back in the day at Google was, if you're going to build these new pieces of tech and you're going to start having machines interact with people for, I don't know, restaurant bookings or whatever it may be, be up front with them because people are fine with it if you let them know, but no one is fine with it if they feel tricked. And I feel the same thing now with chat bots and anything that's happening on your website, people are fine if they know it's a bot, but don't try and pretend to be a person for then that person or the customer to revisit and be like, "Hey, I just talked to Sally last time and Sally's here again, and there's Sally again, Sally's just everywhere. Oh wait, I was tricked, it's not really a person."

Stephanie Postles:

That's when I think that you can do things well, or you might get away with it once, but you actually might anger a customer if you trick them.

Jon:

Yeah. Tricking customers never a good look, I don't think. My customer journey steps six is, trick them into thinking they're talking to a person.

Stephanie Postles:

Oh, that's a good quote, tricking the customers never a good strategy.

Jon:

No, it's not. I don't know, I would be very curious to know what the designer's life on that last stage of Stitch Fix is like. Is it that the AI has come up with banana stuff and you got to piece it back together. I think that'd be fascinating to see how much manual adjustment they have to do, because it's, I don't know, I think people are pretty good at feeling out when there isn't a real human behind it.

Stephanie Postles:

Oh yeah, yeah. I think so too. The other thing I wanted to talk about a bit was trends from abroad. So we've had quite a few guests on the show, some of which I think are actually customers that you guys sent us, and they've found different products, maybe in, I don't know, Japan or Thailand or something. And then they either created the product there and brought it back to the US, or they just brought the trend back here and figured out how to make it here. And I wanted to hear, how are you guys thinking about commerce abroad right now? Are you guys looking into that area? Do you even have customers who are overseas? And where do you see the world headed outside of just the US?

Jon:

Yeah, no doubt. There's two things in there, the first one is this idea that you would bring a foreign concept to another country and introduce it as your own product. And certainly, that happens all the time. And the other is, if you are a company working abroad or even in the United States and you want to address a global market to prevent just that happening, how would you do it? I think actually they're really intertwined because we do see a strong trend right now of companies serving a much more global market from their domestic website.

Jon:

20 years ago, you couldn't find a payment processor that would take international cards in the states, you were getting stuff shipped out of the country, there was this forward carriers. All those services to make it easier, though, very expensive to ship out of the United States really weren't there. But now, you can find a product anywhere and it can be sourced from anywhere. I remember that my son had a plushy stuffed animal and he was given us a gift and it came from Japan, and we were terrified that something would happen to it. And so we bought another one from Japan, which is... I think increasingly what we're seeing is that, because of global commerce and because of the increasingly connections to this both payments and fulfillment systems, it's much easier to be fulfilling anywhere in the world.

Jon:

I was talking to Sally Beauty yesterday and they were talking about how, when they launched in Canada and COVID hit, they just fulfilled from all their stores because they didn't have a local DC and they couldn't do the inter-country commerce. It's like really interesting stuff. But I think that thing goes back to that question, I think it's going to be harder for someone to be like, I've seen this amazing concept in the Philippines, so I'm going to bring it back to the states because no one's ever heard of this and do it because I think that it's so much easier for that company in the Philippines to find and sell into a market anywhere now.

Jon:

We've actually talked about it at Salesforce, is that this idea that you really need to be thinking, even if you're not directly selling to a global audience and what's going to happen when someone from Switzerland comes to your B2B side and wants to buy your ball-bearings, how are you going to make that happen? So, yeah, I think it's interconnected in just that way.

Stephanie Postles:

Yeah. That's a really smart take. So basically the opportunity that used to be there where people would go to a country that maybe not everyone in the US has been to and come back and be like, "Look at this amazing thing," I mean, that's what happened with Red Bull. They went overseas, found it, brought the recipe back here and then it became a hit. It's essentially that opportunity is now closing because we are able to shop abroad, there's a lot of great things happening with localization, and the payments automatically switching over to wherever you're entering in from, and fulfillment's becoming easier, so definitely the gap is closing now around that.

Jon:

Oh, absolutely. I nerd out on audio stuff, and I've got this bananas like Mic arm that I bought from Germany. And I got most of them from a local US distributor, but there were some weird parts because of my microphone I needed. And I just went to their site and it's shipped from Germany and they took my American Express and it came in two weeks. There wasn't some weird customs thing and it wasn't this big process, it was just like, oh yeah, here we go. Boom. And it shows up. I think market's everywhere.

Stephanie Postles:

Yeah. That's cool. I do think there's still a big opportunity though to find very overpriced items and just do a D2C method. We just had on Solé Bicycles, and they said that's exactly what they did. And now they're being sold in Urban Outfitters and they have a bunch of other big partners, but their bikes are, I think like $400 and you can customize them. And there's so many spots that I still see at least here in Palo Alto, I see people riding around with these bikes and there's these big, you've probably seen this Jon, big boxes on the front where their kids are all in the front of them.

Jon:

Oh, yeah.

Stephanie Postles:

Three to $4,000, and a lot of people are going to Europe to have to ship them from Europe and then it's even more expensive. And when I see that kind of stuff I'm like, "Oh, there should definitely be an option because this should not be a $4,000 bike to just have a bike with a big wooden box on the front of it."

Stephanie Postles:

When talking about potential opportunities or not, abroad, the one thing that we were focusing on a little bit was looking at the internet penetration. And so right now, a lot of, I mean, this is more of a VC who's looking into this, but she had a really good quote talking about places like Latin America that have a really high GDP per capita, similar to China, but then their internet penetration being only 4%. So how are you thinking about maybe approaching markets like that, where you have really high GDP for the amount of people that are there, they're ready to work, but then their internet penetration is so low, how are you guys thinking about that?

Jon:

It's interesting. And I would get to this, both internet penetration as well as last mile fulfillment. A while ago I did a project on one of the major retailers in South America out of Santiago Chile, and their big problem was actually getting the product to people and actually payments as well for those final mile pieces. Internet penetration is tricky, I don't know, frankly, I'm a little surprised to hear that because I feel with the proliferation of phones, I feel I'm so ubiquitous right now that everybody has some ability to transact on their phones. It could obviously just be my own sitting here in San Francisco bias.

Jon:

I don't know. The only people that have the capital to do that are going to be like Google and Facebook where you would see already moving into those. I don't know. I don't have an answer to that one.

Stephanie Postles:

I think that regulations are definitely something that's tricky in some of those areas, and I just think the payment thing, and I know inflation has been an issue where alternative currencies in some of these countries have been looked into, whether it's Bitcoin or whatever it may be. But I think there's a lot of opportunity there, but a lot of times they didn't get focused on like, can the people keep their money? Is inflation out of control? Can they actually spend it? And there are a lot of issues, but I also think there's a lot of opportunity once you can get past that barrier and figure out how do we get these people online and transacting like the rest of the world.

Jon:

Interesting. Is that a good thing?

Stephanie Postles:

Yeah. The 4% right now, I wouldn't say it's good because it's like... It's maybe good for their local economy because they're only spending very locally apparently, but they're not getting access to the rest of the world, which there's got to be some reason there, I just don't know enough about it and why not. But when I saw that quote, I'm like, yeah, that's a lot of people who could be coming online for the next like five years or so.

Jon:

It's like when a AOL put users on Usenet, I was like, "Man, everyone is AOL."

Stephanie Postles:

What is Usenet? I was on AOL, but I don't know what Usenet is.

Jon:

Back in the day, Usenet was like the original internet forum system, it's where like all.nerd.games and like rec.games.pinball, my favorite one in college, it was where the nerds hung out. And I remember it was this exclusive community of college students and internet nerds, and AOL was going to take all of their unwashed people and bring them onto the Usenet forums, and here we are, internet broken.

Stephanie Postles:

Okay. Now, I know, I learned something very awesome and new today about AOL, brings me back to my days of putting up my away message, BRB, going to eat a sandwich.

Jon:

Yeah. And it's funny because Salesforce just bought Slack, and so now all of us are thrust back into Slack and everyone's like, "How does any of this work?" It's really interesting to feel so old, "What do you do with status?"

Stephanie Postles:

We just had Slack's CTO on, IT Visionaries actually. And it was perfect timing because then I think it was two days later it was like, Salesforce acquired Slack and we're like, "Ha ha, we're right on it." We just had [crosstalk 00:36:50].

Jon:

Step ahead.

Stephanie Postles:

Timing news check.

Jon:

It'd be an interesting acquisition, I think it's going to be really good for the company.

Stephanie Postles:

Do you think you guys will be able to figure out the away messages and how to use it?

Jon:

Well, anything connected to the world's number one CRM is going to have outstanding away messages though.

Stephanie Postles:

That'll be fun. Fun to hear about. The one thing earlier that you mentioned, I think is also an interesting trend was about fulfilling from stores. So we've had a couple of brands come on where they were like, "Well, we didn't do this before, but with COVID and our warehouses maybe getting shut down, and then we had all this inventory sitting in stores, we actually started using them to fulfill the orders. And then we realized that, "Oh, it's more efficient to do that because if someone orders from California and our stores are in Oregon, it's better to ship from Oregon than to ship from our warehouse that was maybe in Virginia or something."

Stephanie Postles:

And so they started using a more localized method and fulfilling it based on where the person was ordering from, which apparently, a lot of them weren't doing before. So do you see this staying around even when retail starts to open up again? Do you see them continuing to use maybe retail to also fulfill orders or maybe reverting back to warehouses or PPLs?

Jon:

Well, I think that fulfilling from stores is for sure in the future, and I think that there are a couple of reasons. One is that warehouse space is just getting so expensive, particularly around in city areas. Amazon just spent $200 million for the old Greyhound lot here in South of San Francisco, it's crazy money. So if you already have a physical presence, I think in my experience, living here in San Francisco, Best Buy is doing unbelievable job of this where when COVID closed their stores, they turned them into distribution centers, and you can do all your buy online, pickup in store. When it reopened, they did the mix thing.

Jon:

I think that people will continue to use those mixed models. And I think that the benefits are actually on both sides, it helps the consumers get stuff faster and frankly allows a wider variety of stuff to be stocked because you can have more stuff in stores than you can in a single warehouse is my belief. But from the company standpoint, you can shift stuff more quickly and you also... My wife just got a job doing this, she works up at Sport Space, which is a small sports retailer here in the Bay Area, and she's doing ecommerce fulfillment from their store.

Jon:

And so they have like 15 stores and they use every one of them as a warehouse, and their volume over the holidays has gone way up, but they've coped with it because they have a zillion DCS. I think the trick to it although, is that really for it to work properly, you need integrated inventory. And that can be really tough depending on your backend systems. But if you can get that, then I think it's a total no-brainer

Stephanie Postles:

Oh, that's smart. We when we were talking to Wellesley, they were saying the same thing about they used to have these stores where, they're B2B, they are plumbing and HVAC and stuff, and so they would have these big stores that you would go and talk to the salesperson and place your order, and you could look around and all this. And she was saying in the future, they're thinking about moving to just, they don't even really need a store. They have this huge warehouse behind the scenes, like a shoppable warehouse and you just come to the curb and continue picking your stuff up.

Stephanie Postles:

They don't really need their store anymore, and that's the way they're thinking about the future could look for a lot of businesses, either shoppable warehouse or just order online, and if you need to come pick it up in person there's a very mini, mini store out front of the warehouse that you can transact there if needed.

Jon:

Absolutely. I think that, certainly, I'm biased here in California and I see what it sees in San Francisco, but certainly the downtown area, the metropolis of San Francisco is still completely shut down, very few people are going to work. And all of that real estate is shut down both in terms of offices and the commercial stuff on the ground that I don't think that there's any reason to think that all that's going to open up exactly the way it was before. I think there's going to be a lot of innovation in the physical retail space, particularly in places that are based on worker and office traffic and not like suburban weekday traffic.

Stephanie Postles:

Yeah. What kind of innovations do you see coming? Because I do think retail will be transforming. A lot of the retail stores, I think, we'll have to have that in-person experience component or event or something to bring the people into the store because they're so used to shopping online at this point, probably it's like, "Well, what reason do I have to actually go to a store and be in-person and talk to someone?" Or whatever it may be. What kind of changes do you see coming for physical retail?

Jon:

Yeah, absolutely. I think that just drawing up on what we've talked about already in this call, I think that you will see a deep emphasis on stores that really are just, or the staffing levels in stores that really are just warehouses. If you are a Costco, you just don't need that many people because the vacuum is the single vacuum and that's what you're going to buy. But for stores, I think that the physical retail transformative places where taste is the big thing, or there are multiple products that are equivalent and you want someone to help you curate, this is my Resto vocabulary.

Jon:

But ultimately, a human just going to actually help you walk out of the store with something that's a better fit for what you want. I think that that's the future because... Where was I? I was in line the other day, and I walked to the place because I just wanted to get this one thing and I'm waiting in line, it's like, there's no advantage to this, to, "I know what I want, I want to get out of here as fast as possible transaction." But in a transaction where I'm like, "Tell me which one of these is the right one?" That's where I think physical retail is going to shine.

Stephanie Postles:

Yeah. I agree. A couple of times I've been in line maybe at, I don't know, a T.J. Maxx, not recently obviously, or something, but I would just give up because I'm like, "This line's too long, I came here for a reason and now I'm in-patient. Goodbye." That's happened multiple times, I'm like, "Why can I not just walk in and walk out with this stuff and just hit my credit card with it or whatever it may be." I know Amazon was experimenting with that, but to me, that's going to be the way the future, because I don't want to wait in another dang line ever again. I'm spoiled.

Jon:

No, absolutely. And I think self-checkouts too. I did the Amazon Go store and I found the whole thing very weird because you're very aware that there's a camera in the shelf and everywhere, they're recording everything, but that was the best ever. But to your point, I think that people get used to a faster transaction that they're not. I totally get, you need full service, but no one has the time to sit and wait, or I guess some people do, but it gets frustrating and it's a bad customer experience.

Stephanie Postles:

Where do you see the world headed for ecommerce? I mean, big picture, any higher-level things that you guys are preparing for that we haven't covered yet? Or why you guys are working on the things you're working on right now?

Jon:

Yeah. I think probably we're working on stuff which will make having a really amazing customer journey easier. I think that you can say broad... I think there's an argument today that commerce tools on their own are commoditized. At the end of the day, you can build whatever you need with any of the major packages from just a pure commerce standpoint. And so I think the question becomes, what are the tools that are going to help you have a complete customer journey because you're going to be losing control of the specific place that you're going to meet your customer, so how do you continue to build journeys that are amazing anywhere? That's really where I think we're going right now.

Stephanie Postles:

What things are you focusing on then? When you say, making sure you have a good customer journey, I think a lot of people say that, but not everyone actually gets, what does it mean to have a good customer experience and journey. So what kind of things are you focused on right now to make sure that happens?

Jon:

Yeah, absolutely. I think it's a fair question. And I think a lot of people are like, headless ecommerce? But that's a technology. I think really what you're looking at are ways that you can 100% of the time know who you're talking to as a company and identify your customer. And specifically what that means to customer journeys is that means that when you start with a marketing campaign, that whatever that messaging and whatever you know about them is then reflected in the commerce campaign, is reflected in the order management, and then all the way through to the service.

Jon:

So a customer experience at that point is actually the experience of the totality of interacting with your brand, of discovering it, transacting with it, and then enjoying the product or whatever is after it. So that's what we mean by the customer journey, the full thing and how you can make that coherent and make sense and not like, "Oh man, well, you're in supports domain. Godspeed, I don't even know what those guys do."

Stephanie Postles:

Yep. I love that, especially knowing who your customer is. We had on Domm from Fast, and that was his biggest thing is even though they're known for that one-click checkout, he's like, "We're actually solving for identity so that you know who someone is and you're not constantly having to ask them to fill in the same details that they filled in 1,000 other times in different places." And once you can figure it out, the identity piece, the customer experience part will be easy to figure out because then you already know who you're talking to, what they're looking for, their payments stuff's all covered, and it becomes very frictionless.

Jon:

Absolutely. Totally. And I think that that's the future. When you want to reorder from someone, you want to do with one click, you don't want to be like, "You guys definitely know my phone number, but here it is again."

Stephanie Postles:

All right, Jon. Well, thank you so much for joining us today, where can people find out more about you and your awesome work?

Jon:

Oh, well Salesforce Commerce Cloud, everything I'm doing is up there. Unfortunately, it's all gated, but check it out. I'll make sure they don't badge you too hard if you do check it out.

Stephanie Postles:

Yep. Hit Jon up if they do, he's your guy.

Jon:

Totally.

Stephanie Postles:

All right. Thanks so much.

Jon:

Thank you. Have a great day.