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Hey, y’all! Welcome to episode 9 of the Southern Fried eCommerce Podcast from EYStudios. Today on the podcast we have Jay Brimberry, our Director of Operations, joined by Phil Grier, our solutions engineer, and Emily Faulkner, our executive producer.
Before we dove too deep, we started out by discussing our Halloween plans. Phil has not dressed up for Halloween since the late 90s but went out with the Energizer Bunny so we can’t shame him too much. Emily, however, has not figured her costume out yet but is attending a drag-themed costume party so wish her luck! Jay, as the resident family man, is being a good sport and going with a full family-themed Wizard of Oz costume with his daughter as Glenda the good witch, his son as the cowardly lion, his wife as Dorothy, and him donning a tin man costume. We must point out that this says nothing about the state of his heart.
This week we really want to start taking a closer look at what’s going on in the world of eCommerce and truly dive into what these top publications have to say.
First up today we have ECommerce Product Releases of the Week from Practical ECommerce. We explored each product with Phil, Jay, and Emily weighing in on whether or not they thought these new products were worth investing in:
HubSpot launches new payments service.
PHIL: “I think it speaks to a wider movement that we’re seeing towards getting into payment processing, for platforms that haven’t traditionally done it which is obviously a really good source of ongoing recurring revenue.
So I think that’s why we’re seeing a lot of companies like HubSpot getting into the payments space. Obviously, Shopify has been there, that’s one of their primary ways of making money. But, these subscription platforms are just looking to add more and more features and functionality and I think we’ll see how it plays out. I know it usually comes down to transaction rates and what the end cost is for merchants.”
JAY: We do have some merchants that use Hubspot and we’ve integrated Hubspot pretty seamlessly into Magento and Bigcommerce and I think Shopify as well. I don’t know about Salesforce Cloud. I would think that SalesForce Cloud, as a competitor, wouldn’t want Hubspot being integrated into it but maybe.
I think it’s going to be interesting if it simplifies if it’s just one less person that our merchants have to talk to. It’ll also be interesting how seamlessly you can integrate something like that into a platform you know even if it’s built out of the CRM. How does that work right there? But, yeah I think it could be pretty interesting and potentially game-changing for Hubspot merchants but we will see.
Shopify launches Global ERP program
PHIL: “I think this is a pretty big one. ERPs are some of the most complex pieces of software that merchants use. They have a lot of hooks in the eCommerce platform and merchants backend. You know, managing things like product information, ordered data, fulfillment, forecasting — ERPs do quite a bit. So, there’s a lot of integration, and the tighter the ERP is kind of pre-integrated with the platform can decrease cost for merchants, speed up go-to-market, and yeah that’s a good move.
JAY: “Yeah I think that’s going to be a nice feather in the hat for Shopify. Now that being said, BigCommerce has a lot of these features as well, Magento has a lot of them. But just kind of being able to focus on some of these like the NetSuite, like the Microsoft Dynamics 365. Those aren’t baby ERPs.
PHIL: “Yeah these are all heavy hitters. It’s interesting too because, and you mentioned BigCommerce, Shopify isn’t really known for operating in the “enterprise space,” I guess you would say. Their tools are much more focused on usability and ease of access for smaller merchants. So it’s interesting as well to see the direction of their product growth to be focusing more on the enterprise customer.
EMILY: I think that’s super exciting but honestly I just wish that Shopify would help those smaller merchants get their lives together. Because every time I shop on Shopify all I find are these out-of-stock products, shipping is egregious, just help those folks. Help the babies of the world stop going for the big fish and help the ones that are actually looking for your help. Enterprise can go to BigCommerce or Adobe.
BigCommerce announces integration with Chargify to deliver subscription management services.
JAY: There are a lot of players in the subscription management game but this one sounds a lot easier than a lot of the other players, right?
PHIL: Yes and not only that, they’re collaborating with Ebizio which is a well-known app developer on the marketplace. They have customer group restrictions, purchase order solutions, and some other apps that are pretty unique and well-reviewed. So this isn’t an app developer that is coming out of nowhere, they’re well-established within the BigCommerce ecosystem. And the more natively this becomes integrated I think that makes a lot more accessible for merchants to start selling a subscription product which obviously through you know COVID and all that, subscription products have become a huge source of recurring revenue for merchants
JAY: We would be remiss to say that we are BigCommerce partners and use some of their other integrations currently like Recharge and Bold. Those are two other good subscription services on the BigCommerce marketplace as well.
PHIL: Yeah, I personally have no experience with Chargify. I know they start at around $400 a month. So it’s not necessarily a solution that’s going to appeal to everyone, specifically those in the lower annual revenue ranges. It’s probably going to be more of a mid-market solution. But I’m looking forward to diving in more on that. And obviously, the more integrations that are tightly natively integrated with a platform, the better for merchants. So this is good news, this is great news.
EMILY: I think there’s a lot to be said about having a one-click solution versus something that can become a little more custom so say like Recharge I think there are always great opportunities for that partner and people like us to create these custom services that actually integrate better with your website, design-wise, and really become a part of the story of your business as opposed to just uploading a nice app that’s quick to move through. There are always ways to improve your website and I think that there are plenty of really good subscription options that work like Jay said, Recharge and Bold. So there are always plenty of options, it’s just what works best for your business.
PHIL: Obviously, I’m much more familiar with Recharge and Bold but I am of the opinion that, especially in my position as the solutions guy, the best solution will rise to the top. And that there’s a good there’s a best fit for every merchant. So I don’t necessarily believe that there’s a best solution “period”. It really depends on what the features are and what merchant requirements are.
Next, we’ll jump into a lightning round where Phil Grier gave new product headlines a “yay” or “meh.” To be fair, he based these opinions primarily on the headlines and hasn’t dug deeper into researching.
- CedCommerce launches Amazon integration for Shopify merchants
- Yay! “CedCommerce is well-known for building connectors so they’re perfectly positioned to support this undertaking.”
- Lightspeed completes the acquisition of Ecwid
- Meh. “Don’t really know much about Ecwid but I’m not sure we need another small platform.”
- GhostRetail unveils live-video shopping platform
- Yay! “I think a lot of people have been trying to crack the case on augmented reality and live video shopping. I welcome every new entrant that wants to take a crack at it. I have yet to see anything yet that balances ease of use for the merchant and the shopping experience for the customer.”
- Emily said though she was a hard pass on this type of service. “The reason I shop in person is instant gratification. I don’t want to talk to anybody, I don’t interact with anybody, I don’t even necessarily want to pretend like I’m walking. I don’t want to walk. I just want my item in my hand right now. So augmented reality I feel like is just more steps for me to have to wait on a product. Because what if it’s not in stock there either? What if I’ve gone to Target and I’ve gone to augmented Target and I still can’t find the thing I was looking for.
- Poshmark unveils new e-commerce innovations
- Phil: Yay! “This is sort of the same thing we’re seeing with machine learning and AI trying to integrate automation and personalization into eCommerce websites. It’s part of a wider trend I think to add more personalization to sites and get away from one size fits all ‘everybody sees the same products’ kind of experience that dominated Web 2.0.
- Emily: Yay! “First off, I love Poshmark and I think this is a better idea than just augmented reality. Like Phil said I think this is more personalization that comes through it without, again, having to interact with people. I love going online and they’re like ‘hey this we know this is kind of your style, we want you to kind of go this way.’ I love the idea for certain businesses because I know a lot of people are starting to start more businesses for themselves. I think this is a great opportunity for those people to kind of take that next step further for them and maybe this is the next jumping-off point before they actually create their own eCommerce store. I think there’s a lot of opportunities there to help those people grow and it helps people like me find more stuff that I want to buy without having to talk to anyone!
- Phil: Yay! “This is sort of the same thing we’re seeing with machine learning and AI trying to integrate automation and personalization into eCommerce websites. It’s part of a wider trend I think to add more personalization to sites and get away from one size fits all ‘everybody sees the same products’ kind of experience that dominated Web 2.0.
Now, we’re going to talk about the ever-approaching holiday season! Our next article is “Online Holiday Sales to Grow 12% in 2021, Digital Commerce 360 Projects.” This is an increase in sales from 2020 but not as substantial an increase as there has been in previous years.
PHIL: 2020 was almost a 41% year-over-year gain largely because of the pandemic. But right now what we have is kind of competing forces of a pandemic, so people still getting a lot of things ordered, a lot of people getting much more comfortable with eCommerce and ordering online, and just accelerating the trends that were already there, but at the same time you have logistics costs, shipping costs, just skyrocketing because there are so many empty containers sitting on a dock somewhere overseas. There’s a lot of politics and economics happening here. So the slower projected growth is not a big surprise to me given those factors.
It is surprising though that we’re expecting the smallest gain since even before 2015. You would think even after last year that we would at least be on track with how we were doing in 2018 or 2019 as far as growth but I think that the shipping challenges are having a large impact. And we’ve seen it; you know, I’m still trying to get a PS5 because of the chip shortage. It’s very difficult to find a product that hasn’t had repercussions throughout the supply chain. So it’ll be interesting to see but I think it’ll affect people differently depending on your industry and how reliant you are on just-in-time shipping. That’s proved to be kind of a challenge as things sort of fall apart. If you’re relying on just-in-time shipping it’s tuned for efficiency but if something breaks along the supply chain suddenly you don’t have a product to sell and that has a real impact on your sales.
Jay pointed out that he has already started purchasing his family’s Christmas presents and asked Emily if she thought earlier buying or “stocking up for the Winter” may have an impact on this growth statistic:
EMILY: Oh I think it’s a huge impact! I’ve been seeing it myself. There are so many stores that have been sending emails and posting just different social media things saying: ‘Black Friday’s already started,’ ‘it started in September,’ ‘we want you to get the products you want right now,’ ‘this is all we’re probably getting for the year.’ I was talking to a merchant the other day and they were saying that they might have to start Black Friday now and cut it off the weekend of Black Friday because of supply chain issues. They know that shipping is estimated to be probably the worst it’s been. Even before 2020.
Phil you were saying you’re having issues getting PS5, I’m having issues with getting things to my house. I purchased an item back in March and it just shipped 2 days ago. So we’ll see how many months it takes to get here now that it’s in The Ether. I’ve lost 3 wedding invitations, I just can’t seem to get things in the mail. So I’m trying to buy everything now and pretty much stockpile it for the winter. So if any merchants haven’t started thinking about the holidays, you are well past that due date.PHIL: You make a good point. And I would like to add I think it’s in merchants best interest to try to avoid disappointing customers. You know say you’re going to have this product delivered by this date and then you as a merchant might not have actual control over that. There might be an SLA, an expectation with your shipper that it’s going to get there by a specific date, but you know sometimes this kind of stuff is up in the air. So we’re seeing a lot of consumers like you buying stuff earlier this year and so that’s going to have a direct impact on the year-over-year gains for Q4 specifically. I think it will be a much more muted Black Friday this year for a lot of people.
JAY: And it’s our job to prepare folks for this. We’re all on smaller merchant Facebook groups and if somebody has a slow day…and I don’t want to minimize this, it’s their business, but if somebody has a slow day it’s a five-alarm emergency and they’re reaching out to find out what everyone else’s numbers were. But I do think we need to start preparing folks that ‘hey this is going to be a weird Christmas season, you know we really hope it goes well for everybody but don’t think it’s going to be 2020 or 2019.’
People are in a place right now where they’re just not spending money. And as you said Phil, it always goes back to politics, rightfully so or wrongfully so people are just getting to a point where they’re afraid to spend money. And couple that with supply chain issues, with other uncertainties going on right now, it’s going to be a weird season and people are going to need to realize that. And they’re going to have to prep themselves and they’re going to have to do their business in a way that may be different. Maybe you have to try a little bit harder for that extra customer. You can’t just coast this year if you want that customer, this year more than any year you’re going to have to fight for that customer. And so thinking of creative ways, make sure your marketing is where it needs to be. All those things are what any agency working with a customer should be thinking about it and should be talking to them about.
Sticking with the holiday sales theme, our next article is from the National Retail Federation, “Holiday Spending Reflects Continued Consumer Demand.” This article is slightly more optimistic about the holiday season.
PHIL: The National Retail Federation is the largest association of retailers in the world so when they publish information like this, it’s a big deal. This isn’t some private firm doing small-scope reporting. This is useful information I think. The thing that strikes me about this is you know in 2019 39% of holiday shoppers started shopping for the holidays before November, this year projecting almost 50%. So it’s a 10% increase globally of just people shopping earlier. And I think a lot of that is to get ahead of the concern about shipping and logistics that we talked about. So this is a more cheery outlook on it but it’s basically just saying the same thing that as the last article that we’re going to see it increase over last year but it wouldn’t be as large of an increase as 2020s totals ended up being.
EMILY: The cheery part I appreciated about the article is that we’re more inclined to give gifts to others. I will say in 2020 we canceled our Friendsgiving, we canceled our Christmas with our friends, just because everybody was in a different place and we just wanted to make sure nobody felt uncomfortable in any way. So I think this year we’re all just in a much better space to give and just make each other happy which is awesome! Then on top of that, making sure my family’s happy because we’ve had an interesting few years. It feels like five years but it’s only really been like two. So I just want to give gifts and make people happy!
PHIL: Another interesting part of this article is where they mention that nearly half, 47%, of holiday shoppers are concerned that they’ll have difficulty finding items this year. That’s in line with what we were talking about with the global logistics concerns. And the top verticals they’re worried about are electronics, clothes, and toys. Not a surprise especially in electronics because of the shortage of silicon chips. If you’re in the electronics industry we don’t have to tell you, you’re probably having a difficult time. The demand is there but the supply simply isn’t. So like I said I think this will impact people differently depending on the vertical that they’re in.
The last article we’ll take a look at this week will be, “Is PayPal Pining For Pinterest?” from RetailDive. This article discusses the possible purchase of Pinterest by PayPal. This purchase would be the largest in PayPal’s history with the current largest purchase being of Honey Science in 2019 for $4.9 billion.
PHIL: This is interesting because I think Pinterest has seen a little bit of declining interest. I mean it’s still generating a ton of revenue, I think 1.6 billion in 2020 which is a 45% increase year-on-year. So in a lot of ways, revenue-wise, Pinterest is still growing. I think market share wise though they may be struggling a bit. This could reinvigorate interest in Pinterest, especially from merchants’ perspectives.
It’s also interesting to note, and this might not be a big surprise to anybody, but 70% of Pinterest users are female. It’s rare in eCommerce that there’s that kind of gap in the targeted user base. Obviously, PayPal is a well-known name. I think this might be just what Pinterest needs to know to bring their relevance back and make it more useful. I think if Pinterest can make itself more useful to shoppers and not just kind of tack on eCommerce features and functionality, that’s really the best solution. So I like this, I praise this move. Even though it sounds like it’s just rumored since neither company is wanting to comment on it. It’ll be interesting to see how it plays out.
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