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Interview

Interview: The Great Brand Debate: Insource or Outsource?

The omnichannel marketing world is in a state of continual change — from new channels and the explosion of retailer ad platforms to shifting logistics and operational challenges. In this webinar recording, Peter joins ecomemrce leaders Melissa Burdick, John Denny, Macarena Herrera, and Jim Morgan, who will give you the tools for deciding between insourcing or outsourcing for your organization.

TRANSCRIPT

Peter:

Hey everyone. Again, Peter Crosby here, executive director of The Digital Shelf Institute with our second ever virtually live unpacking the digital shelf episode. Today, we are excited to host a great debate on one of the most consequential issues of the day. At least in our arena, the explosion of retailer ad platforms, their impact on the business and how best to manage them to insure or outsource. So to get that going, we just wanted to launch a poll while all of you were heading in here. So we're asking here, how are you currently managing your Amazon advertising spend holding agency specialization, NSI in-house team consultant, other hybrid strategy. So just hop those answers in. And meanwhile, I will introduce our debaters. Uh, the sides are represented by leaders from the front lines of e-commerce. I'm Melissa Burdick, co-founder and CEO of advertising platform pack view.

Peter:

Welcome, Melissa. We have John Denney. Who's a VP of e-commerce and digital marketing at  CAVU Venture Partners. You caveat. I don't, I don't know. John Abu venture partners, taboo venture partners, uh, Macarena Herrera e-commerce performance marketing media team lead at Reckitt Benckiser 

or RB as they told themselves and in the cool world. RB. Thanks man. Uh, and Jim Morgan head of e-commerce at Vita Coco Vita, Coco Vita, Coco. It actually depends on where you are in the UK. They call it B to cocoa in the U S most people call it whatever you want, then Vieta Coco, but we're really happy everyone's here. Let's take a look at that poll. Where are we at? All right, Melissa, Lisa, I'm going to start with you. And it looks like, uh, let me share the results here. 28% through a specialized agency, 22% consultant, other in-house team, 17%, only 6% through a holding agency. And then there's a, you know, sort of a bunch in the middle of the hybrid strategy, the hybrid strategy piece, probably doesn't uh, first of all, Melissa, I'm sorry. Introduce yourself. Just let everyone know what you do and what you're up to, and then love to dig into this.

Melissa:

Yeah. Um, thanks so much. I'm super excited to be on this panel today because, uh, I think that we have different perspectives from different sides. And so we're going to, we're going to come together and talk all about these things and that question that you asked, um, I'm going to tee up a description of these different models, uh, in terms of insourcing versus outsourcing. Um, but first you asked me what I do. Um, so I co-founded a company called Packview three years ago. We adopt retailer APIs and we automate marketing across Amazon, Walmart Instacart, um, target through Critio and, and other platforms. Um, and essentially, uh, our, our goal is that we can optimize our marketing ad spends across these platforms and also provide really great reporting, um, within the e-commerce egos for fear. Um, but I'm going to tee it up with these different models because I sit. I'm, uh, we're a tech stack and we're working with all of these models.

Melissa:

We licensed our platform to holding agencies. We licensed it to niche agencies, consultants. You know, I see in housing out, outsourcing, I see everything, um, in terms of what people are doing. And so I'm going to kind of tee it up with a description of it. So, um, on one hand is this insourcing model and that's where, uh, like Maca is representing that, you know, the she, and how do they in-house, um, they license a platform like us or tech stack, um, and they have their own team. That's, that's executing. Um, they're creating both strategy and execution in house. Then there's the other end opposite end of the spectrum, which is fully managed service. So you're outsourcing everything to an agency and that could be a holding niche, a consultant, whoever, whoever it is, um, it's being outsourced. Uh, and then there's this like middle ground and everything in between.

Melissa:

And so you look at these two pillars of strategy and execution, and there are some companies that are outsourcing strategy and then there's some, and then in housing execution, and I define that as hands on keyboard. And then there's the opposite of that, where there's, um, you know, the in-housing of execution out housing, or, you know, having someone come in to think about the strategy. So those are kind of the various models that we're all dealing with. But I think that, um, the one thing that I will say is it takes a village to raise a child. It takes a village to raise an e-commerce business. And that's part of why this is exciting today because they're smart people, they're smart technology platforms, but, uh, there's, you know, smart consultants companies that are all together helping everybody to succeed and win in ecommerce.

Peter:

And I think we've all been in the business long enough to know that these things tend to go in cycles. And sometimes you, you know, you run towards, Oh, no, I got to get control back over this. I'm going to forget it all and bring these people in. And then all of a sudden you're like, Oh, there's an additional set of skills or something new popping up here that we don't understand yet. We've got to go get some help. And so you end up kind of waxing and waning, I would imagine, depending on the moment. Um, so Jim, Jim, let me bring you in here too. Um, cause I would love to one, you know, how do you respond to some of what Melissa was talking about? So tell us, you know, sort of what your point of view is where you've come from and, uh, and how you're thinking about this.

Jim:

Yeah. So, um, you know, the way we use a specialized agency that I've been using for a few years now, from my point of view, um, you know, there's, there's two things, the two big benefits with using a specialist agency. One is just the expertise, specifically around, you know, we're talking about, uh, Amazon, uh, you know, the expertise that they have is, uh, you can't compare that to, I think, a, a larger sort of holding company. I think that, you know, Amazon is its own beast. Uh, there are so many factors in that flywheel that you have to consider before you're even able to run media. And if you're, if you're a holding company, you don't really necessarily have that expertise probably yet because you're managing so many different types of media, um, or you're, you've moved people on from, uh, you know, different, uh, you know, the Google search people or Facebook search people, um, whereas a special ed specialized agency, they know how all those different factors interacting, know that, you know, if there's an availability issue, then they're not able to run media.

Jim:

If they're not able to run media, they're not able to get commission off of running media. Um, so I think there is this just overall knowledge, um, that they have around that, which allows them to optimize not just for media, but for your entire business. And it leads to, I think, a proactivity on their side that they can't, it's not just, you know, we were running media in our hands are off, they need to be ahead of everything. So, you know, in my experience having a specialized agency and just having a media partner is having, you know, three or four extra people on your team that are constantly watching your, your Amazon business, um, because they have to understand all those things interact. I think that's, that's one and probably the most important piece. Um, I think the other aspect of it, especially if you sort of compare it to, um, having somebody in house or building out your own media team, um, I think it's that ground level expertise that, you know, a specialist agency, particularly, you know, if, if they have a great relationship with Amazon, they are at the ground level, understanding every new development, every single new ad product.

Jim:

Things are changing every day that every single day there's something new. Um, and they're, they are on the front lines, whereas yeah, you could hire somebody who's currently managing, um, you know, Amazon, uh, or, or retail or media at one of these specialized agencies. But as soon as they come over to your side, then they lose that, you know, that link to the actual retailer, um, which is going to require, you know, even if they're constantly on top of everything and talking to people, I think you're still going to lose out on what's going on in that bill, the ability to get into beta tests. That'll I think only an agency would be able to, um, to get you into. So I think those are, you know, those are the two factors for me that, you know, if I compare it, you know, if you're comparing just purely costs, yes, it could be potentially more efficient, um, to have somebody in house and, and pay them as headcount. But if I, if I factor in just the total value add of, um, having that sort of expertise that builds your entire business, not just the media portion, but allows you to have just a better, more efficient Amazon business or retail business. Um, I, I just don't think it's even comparable. Um, and that's, that's sort of my, that's been my experience as far.

Peter:

All right. Maca. So Jim just threw down the gauntlet, especially. So first of all, as I bring you in here to take on that challenge, um, first of all, please do, do I tell, uh, talk a bit about your role at RB and then, and then as Jim said, the specialized agency king of the way to go, but you're building a different model there. So tell us a bit about that.

Maca :

So, I'm going to immediately probably help, um, managing brands and categories like vitamins and supplements and fall and flu and baby formula. So we spend our days like very different categories. Uh, and I think that's important to mention, because I do think that when you have to decide whether it is healthy or not, um, one of the most important things to me is like, do you have internally the categories and the different teams that could prof learn? Right. Because I think, uh, there's two things that, to me, are the most important things when deciding this one is the size and complexity of the company. And the other one is the availability of the resource, right? So in RPAs RVs, a big enough company, it's a global company, you know, it spans across a lot of categories and we have enough resources. The company is investing significantly on the farm.

Maca :

So we do have the, so from what Jim was saying about the advantages of, you know, a specialized agency, I agree, but if you can have it in your company, then, you know, the value of the agency sort of, you know, decreases, uh, in our case. Um, our, and to be completely honest with you guys, we didn't get in housing right away. Right. Uh, we started like a lot of companies. We started with a holding agency. Uh, that's what we were used to doing, you know, it worked before, um, you know, Amazon media came up. Okay. You know, can you do this too fine? Perfect. Let's do it. Um, but then as, um, our, we started to focus more on e-commerce and we started to develop more, you know, internal knowledge and experience. We started realizing, you know, they have this way, this traditional way of running media, that doesn't really, you know, it doesn't really work on Amazon. Amazon is a whole different beast. And as anyone that works on Amazon knows it's like, uh, an ever-changing environment where like, I feel like, like it's like neurons that all of them talk like talk to each other and everything, you know, affects everything. It's like, uh, it's very hard for these agencies to be used to working with like audiences and, you know, um, KPI search keywords.

John:

Yeah. It doesn't fit into that perfect agency holding model thing that that can be repeated it's its own.

Peter:

Yeah. John, talk, talk a bit more about that. First of all, just as we're bringing you in here, just say, Hey, you know, where your focus comes from, but I'd love to hear a little bit more.

John:

Yeah. So a little of my background. So right now I'm, um, uh, vice president of e-commerce digital marketing for kava venture partners. So we work with, um, lucky enough to work 20 plus different consumer products, brands, high-growth challenger brands that are ranging anywhere from 10 million in annual sales, up to a hundred, 150 million, as Micah said, I think it, you know, it also that that matters the size of the company matters. Um, you know, I have an interesting perspective because before that, before Cabo venture partners, which was, uh, was my, I was head of digital and the e-com and media and advertising for beverages. So my role at BI for four years was not just e-com, it was heading all media and advertising. Um, so, uh, you know, I had a slightly different perspective when I was heading up all media making advertising decisions. And there I was working with, um, major holding companies to deploy my advertising budget.

John:

You know, I got to about 35 million that I was investing in later stages. And so I had major holding companies deploying, you know, 15 million in linear TV advertising span. I had 5 million, an outdoor spend. I was spending another 5 million in programmatic, you know, using Google Facebook, you know, all social channels and spending across the spectrum, but I had e-commerce and it was interesting that Mike was talking about holding companies because I would have, I actually was able to work with two holding companies one for three years, another for another year. And in many cases they were great executing television buys. They were great, you know, outdoor buyers, fantastic, even programmatic, but Amazon at that time did not fit into the cookie cutter mode of what they wanted to do. I mean, Amazon is incredibly complex. And as Jim said, you got the whole retail and operations part of it.

John:

That is the complexity of it, is very costly and it doesn't fit into that sort of mode. Um, so shifting into my job now, I work across, you know, 20 plus brands. They're all in a wide range of situations, you know, and it's been fascinating to watch how they deal it, deal with it and sort of all different combinations of situations. But it, it really does depend on the size of the company, you know, at Reckitt at, you know, five, 8 billion is going to be different from a company that's 15 or 20 million in annual sales and, and the staffing that they have,

Melissa:

How do they make those decisions? Sorry, how do brands make decisions? Well, how do they make the decision, what to do to they insource or they outsource, like, what's their matrix.

John:

That's part of my job of trying to work with them to figure it out. And I'll give you an example. I mean, you know, um, over the last two years, I've had two large portfolio brands that were over a hundred million in total sales on Amazon. They were probably doing North of 25, 30 million in sales, but they were running their own paid search, um, internally. And you'll like this, Melissa, they were using no technology platform at all. Now, what would you say if you walked in and you saw this in this day and age, they're, they're not using a tech platform, but what would you, what would your response be to that? You should

Melissa:

Use PACU,

John:

But essentially, I mean, I've heard a great description of this today. It's like walking into a gunfight, carrying it with a knife. I mean, you know, you are competing with, if you're not using the same stage that happened on Google's circa 2000, 2002, three, four, uh, platforms emerged to buy an automated fashion across multiple exchanges. And the efficiency of buying was just incredibly powerful things like day parties. So what I said to this brand was you're buying this internally and you're not leveraging a tech platform. You're not using a day party and you're not using automatic, automated bidding. You're not at the edge of what's happening. Your dollar spent is getting you far less than your competitors spending. So number one, you got to change that. So, you know, so it depends exactly on the individual situation. That's just an example of, uh, you know, me saying to them, you've got to change that tech left arm. Now you've got to decide, are you going to bring that in house? And, and through like a pack view or another platform or can't you, and then get, and then get trained on how to execute, which gets to what Jim said, like, are you going to know enough? And are you going to be up to speed on the changes that are happening every day, uh, on the, on the tech here? Or are you going to try to outsource it to a partner? Um, so again, it's gonna depend completely on the situation.

Peter:

So a couple of things here, one is we have to, I mean, we're focusing on Amazon because there's sort of the big, big elephant in the room, but it's just the beginning, you know, certainly Instacart has been coming up very fast. There was a really interesting article recently in Business Insider talking about Walmart. And actually they mentioned pack for you in that article, talking about sort of the, um, Walmart in a way kind of pushing agencies, the sort of holding agencies out of the game in, in favor of the, the, uh, platforms like [inaudible] and current issue. Um, so, so there's, there's clearly a shift in terms of even how these retailers want it to work so that it works best for their, their customers. Um, and also for the consumer and Melissa, I'd like to go back to you with this, because I'd love for you now that we've had sort of the point of view across both. Like, what do you think about the framework for decision-making? Like, what is the decision matrix of the variables that you would say a brand leader should think about in order to decide, you know, where they go with this strategy?

Melissa:

Yeah. I think there's a lot of them, and we've talked a lot about it right now, but I think one is, and I'd like to ask Maca next about this, but one is like, do you have one is how big is your company we've talked about that? Are you a sizable established company or are you a niche company? Uh that's when two is, you know, what's your bandwidth to be able to take this on in house? Like, that's, that's a huge issue. Um, I know the other part about our industry of e-commerce is that there's a lot of movement. There's a lot of people moving around jobs. And so I had, um, one company tell me, I will never bring this in house because I can't staff it. Like I can't keep people here. So that's, you know, like part of it is you have to be able to have a career path for these people and that 's like, you know, you can be able to keep those people.

Melissa:

That's, that's another one. Um, the other is, uh, like executive support. And that's kind of the question I wanted to ask Monica is that if you are one of these companies, like it is an initiative, we're going to bring this in house and build the team cause that's costly and it takes money. And sometimes it's easier to get the budget to outsource and get an agency to do that work for you. And so, um, those are, you know, those are some variables I probably have missed a couple of them. What helped me out guys? What are other variables that I may have missed?

Jim:

I think that's, yeah, I think that's a that's I think that's, I just, I, John and, and Maca touched on it. I think that the term like in-source or in-house is, is it makes sense for, you know, for an RB that has resources and a lot of complexity, I think for a lot of challenger brands, the term, uh, in sources probably it's a very fancy term because it doesn't mean actually in starts, it means let's have the one person managing e-com figure it out. It doesn't mean let's build, uh, an array of resources and cross learn. It just means let's just let's well, let's just add it to the list of things to do, which is usually indicative of a lack of internal support. And the other factors you just touched on Melissa,

Melissa:

And that kind of reminds me, we just had this situation happen where we had a client, um, in S in housing, uh, their Amazon and, uh, and basically all their retailers, uh, paid search, but this one person was responsible for all of e-commerce. So they were doing everything plus trying to run paid search.

Jim:

Matt. did that for years, as soon as it's just like setting, forget it. I'll check next month. Yeah. That's okay. If you're spending, you know, if you're spending 1% of your budget and it's all going to Brandon defense, then that's okay. It's manageable. But if you're, if you're spending any sort of significant amount of budget, then, uh, it's a terrible, terrible way to manage it. I would say

Peter:

This is a great little time to run this, this, the second poll that we have, because that percentage of spend, uh, is sort of a starting place of like, how, how should you think about the investment in managing that? So I'm going to launch this poll here, folks. So, uh, how do you think about your budget for Amazon? What percent of sales are you thinking of spending? Uh, let's say in 2021. So throw those in there. Okay. Coming in fast. Great. All right. I'm going to give it five, four, three, two end poll share results. Wow. Yeah. Feedback. What do you think here? That's less than I would have expected. That's just my first,

Maca :

Well, it's so dependent on the mix of who's who the people taking the polar to John's point. I mean, John, do you want to talk a little bit about how you and how you help your brands think about how much they should be spending and, you know, are they a challenger brand? Are they a leader? Like, how do you think about what percent that should be?

John:

And again, it, it, it, we were talking about this earlier where, um, my particular view coming from BI was I was in charge of all the advertising and media spend. And I was spending time on Amazon. I had a lot of brands that come to me and say, well, I want to spend a, of my monthly Amazon sales. I only want to spend 18% and I need to stay right there. And, and, and I want to manage that. And the way I used it at buy was I wasn't looking at it as e-commerce. Okay. The dollar I spend on Amazon must result in $2 of sales on Amazon. I was spending on Amazon and DSP and even Amazon search for all of my awareness, the same way I'd spend Google search or Google display network or running awareness advertising. So for me, making it, forcing it to be a percentage of your sales on Amazon resulted in activity that you didn't want to be doing.

John:

It forces you to spend far less than you want to do, or far below the potential of the impact of what you were doing. So I tend to have that conversation with brands and say, well, is there a world where once I show you the, the omni-channel effects, the omni-channel world that we live in, where consumers are seeing your product on Amazon and they're purchasing at Walmart and target, is there a world where you begin to look at this differently and look at maybe a percentage of your total, total, total sales, and look at a media mix model across everything they're doing. So

Peter:

Maca, what do you think about when you see these numbers? Does anything jump out at you? What do you think about that sort of return on ad spend and accounting for its omni-channel impact? I know that's a big topic of conversation.

Maca :

I think it varies a lot by brand. Um, it varies in the size of the brand. It varies in the brand, uh, recognition, right? So I think, you know, when we, when we have a new brand that we're launching, of course, we're going to be spending tons of money to push that brand, but it's not the same that if I have an established brand that the consumer already knows, and in our view, we have everything right from like very well known brands that consumers are just coming to the platforms, looking for them where, you know, um, maybe it's very cheap for us to defend our brand. And then we can, you know, go and expand into category terms and conquesting terms, and probably could capture more consumers, but it's, it's not as expensive for us, uh, because you know, it's a very relevant product. And so, you know, the relevance, you and Amazon will be good.

Maca :

And so the CPC is going to be lower. Versus when we have new brands that we launched, of course, we have to invest way more money to get those brands to, you know, when their place, um, so it's, to me, it's like two things is one course is like, whether it's a new brand or established brand, is it a big brand or a small brand, but then the other thing is also the category, right? It's not the same to play in a very competitive predatory versus in a, not so competitive category there are categories where CPCs are huge. If you don't invest like a very, you know, decent amount of your budget, you're not going to get anywhere. So it's, it's, it's really a very tough question for me to answer here, because we see in our brands a very broad range of percentages.

Peter:

So a question just came in from Holly and John. And I may put you on the spot a little bit because I'm going to kind of do a digital shelf Institute plug here. Because she asked the question, which came up in the executive forum of the digital shelf Institute without investing in mixed media models. How can you estimate the attribution of the Amazon investment to other channels? And, and as you know, John and Melissa, I think, uh, and Jim, like we undertook kind of an investigation where Chris Perry, who many of you may know has a long experience in this and Molly Schonthal who runs our executive Institute, you used to run digital Lamar's. They did, um, they undertook this investigation with input from a bunch of the members of the executive forum to gather a look at how we could possibly account and calculate off channel, um, other channel contribution of Amazon spend. And we're going to have that research and a calculator that you can use, which has assumptions built in. And it won't be perfect, but we feel like it might be useful for executives to use to kind of both, um, make the case for themselves, but then make the aggressive case inside of their organizations that we need to think about a different way. And John you've been involved in that tool developed, what do you think of that research? And do you think we're on stuff?

John:

I love it that the digital shelf Institute is doing this and sort of advocating the omni-channel world because as you know, as Molly knows and you know, I get frustrated because I think about the way my wife buys, you know, um, she'll be at, uh, whole foods, pull something off the shelf, she'll open, you know, open her iPhone, open the Amazon app and she'll run down and check ratings and reviews for the product and then make her decision to buy. And sometimes she's in store and, and my daughter's in store and she'll buy something from Amazon, sitting there, looking at something on a shelf we exist in an omni-channel world and all effects are coming in a channel way. Now, the question that Molly raises is how do you prove it? How do you prove it to people? I was lucky enough when, when we were acquired by Dr Pepper Snapple group, they then invested half a million dollars on a marketing mixed modeling study that took five months.

John:

And, and so I saw the validation, but we made our decisions to have that strap. I, as a media person, was making decisions to invest a significant amount of dollars in Amazon, given signals that I was seeing and signals, I was seeing the same signals I was seeing on Google using their display network or using Facebook. And you have things like Kantar Millward Brown brand lift studies, where you're running your campaign, you have exposed people and you have unexposed and they're tracking those shopper panels once the purchase lifts for people online and in store. And we were able to see in a Kantar Millward Brown study, you know, a brand lift and, you know, it was like, uh, you know, enabled to see the data. Here's the lift, here's the purchase that happened. And I remember being so amazed to see the lift, the amount of lift that we saw offline. But again, it was like the same decisions I make to buy programmatic on exchange or Google display network or other media, you know, there's a certain tool that we also have brand awareness tracking that helped us with that. But the bottom line is you're, if you're a smaller brand, you're not going to have absolute certainty. You know, you have to have some experience and reps in the game to have seen to run it, test it, and then see what happens, uh, and then take that experience on,

Peter:

Well, I hope that certainly the research when it comes out in early December, we'll of course let you all know. Um, but we're hopeful that it will at least help provide a model to sort of combine gut plus plus measurements. Um, and also I think Chris and team have done a really good job of kind of laying out all the various, uh, channels that can be impacted, not just physical store, but also a lot of the others as well, that I think hopefully it will be useful to people. Um, Mark, I wonder, I'd like to go back to you for a, for a bit, you know, talking particularly about the in-house model. Um, you know, you talk a bit, uh, when we spoke earlier sort of about the trial and error approach that you take in RB and, and kind of communicating across teams and, and I'd love to, um, sort of hear your journey on that and kind of how you, how you keep that, that model moving and improving over time.

Maca :

Yeah. Um, so, um, as I was saying, we started with a holding company, but then we did try the specialized, um, agency. Um, what happened with that is at the beginning, we felt like it was going great. Like, Oh yes, this is so much better. This is working. Um, but then what happened is, like I said, as you know, Amazon is so dynamic and, you know, things are happening all the time. It's like, I dunno, it's like things are happening at lightning speed. And what started happening to us was we felt, we started feeling the agency was just like an extra step to get to do what we needed to do. So, you know, things were happening all the time. We were in meetings and EV you know, new things were coming up all the time and we just felt like, Oh, now we need to go and communicate it to them, so that they take action.

Maca :

Um, and so, you know, that started happening where, uh, like the agency started feeling a little bit left out, like, Oh, wait, you're asking me to do this, but I don't really understand. And I was like, well, explaining this takes so much time, but, you know, we got to a point where it was like, we, you don't really understand what our strategy is. We wanted to use different KPIs to what they were used to. Um, and I think, uh, just, um, the interaction between media creative retail that goes on, on Amazon, it's very hard for an external partner, um, to truly be a hundred percent involved. And so that's why I was saying, if you do have the, you know, the size of the company and you have the resources, um, for us in health was at the end of the day, the best option, because we did have enough people to, you know, become experts.

Maca :

And, um, what do we call like, you know, we, we like to think that we're developing, um, like key opinion leaders inside of the company that can then share learnings across the globe. So we do have teams across, you know, across the world. Um, we do have, uh, internal seminars that we run with, you know, sharing best practices for eventing, like prime day or black Friday cyber Monday. Uh, you know, we share learnings whenever anyone runs a test and learns AB testing. Um, so that's how we sort of continue to learn all the time and continue to be, um, you know, uh, grow our teams. But the other thing that I think is really important that I found different between in-house and having your agency is that in-house, um, I feel like we have motivated people that are always thinking, okay, what next, what else can I do?

Maca :

I need to grow my business, right? There's that motivation that the business is yours. And, you know, maybe this is a cultural thing in RB. Uh, but I don't wanna be, you really feel I own the business. So I own the business I wanted to grow. What's next? Like, yes, now I have, you know, my media strategy. This is how I do it. I have my tool that I optimize automatically, you know, I have everything done, but as you all know, it's not, uh, on Amazon, it's not like, uh, you know, it said it and it's done. Like, it's an always evolving thing. So we are constantly asking ourselves, okay, what else? What's next? What more? And that's why something that

John:

I was just gonna say, you know, I want to go work for RB based on just hearing what you said. It's like, the other thing I would just throw out is like it. You have such a unique place. Literally. I was thinking so many superstars in the industry have come out of RB. It's almost like the Patriots, like, you know, like the people that pitch coaches going and coaching and all the others. It's like RB has such a unique mindset. And like, everyone I've met out of there is like the same thing, like RB mafia, uh, Chris Perry, Garrett bloom, it's like the rock stars. The industry is like it all came out of your company and it's just like, it is so cool. Just hearing the philosophy that you guys have.

Maca :

I'm very, very lucky to be at RB. Yeah,

John:

No. Yeah. And it's not completely normal to what I've seen. It's like UV.

Maca :

We encouraged, uh, you know, to think beyond thinking outside the box, uh, test, learn and they're all in for testing and learning. So it's great, you know, it's a great environment for learning. And that's why, when, you know, when you think about the advantages of the agency, uh, to me, it's two right. One is okay, I need hands and legs. Right. Uh, like more people to execute, but then the other one is, you know, Oh, you know, they have the experience of like different clients and different categories and the contract with Amazon. Well, we have contact with Amazon. We are part of data all the time. Uh, we have internal teams across the globe that are doing this in so many, you know, testing and learning all the time. And, uh, like I said, RB does invest in, you know, their teams learning and getting experience.

Maca :

And so for, for me, um, I really think in our case, in-house is the best option because of all these reasons. Um, like I said, I think if you have your, have people in your team that are motivated to go beyond right, then, you know, they're gonna find the ways of, you know, being, uh, uh, you know, very on top of the very latest things that are coming up, uh, trends. Uh, we are always, you know, exploring new things. And honestly, this doesn't mean that we're like completely opposed to having a partner, none at all. We're having conversations with partners all the time, all the time. Um, because we, if there's anything out there that's groundbreaking and that's really going to change the deal, we want to be a part of it, for sure. So it's not like, Oh no, you know, we're better at this than anyone else out there.

Maca :

No, no, no. We're humble enough that we understand that, you know, someone else can come in and it, I mean, you know, this is like, anyone can disrupt anything in this world. Right. So of course we're open to knowing and understanding that this can happen at any time and we don't want to miss out on it. Right. So that's why we are constantly having conversations. And to be completely honest with you, we're currently testing our partner in one of our brands. Um, we're doing this all the time. Um, sometimes, you know, it'll, it'll work and maybe other times it won't, uh, you never know, but I think the important thing is to, you know, never stop asking yourself, what else, what's next? What else is out there? Who can I talk to that could know more than I do, right. That, that my sort of mantra

John:

In this world that we, all of us exist in, in this e-commerce world is if you think, you know, everything that thought is the problem, because it is just so like, you have to go in with absolute humility that whatever you knew yesterday does not count at all.

Melissa:

Well that's because it changed the algorithm. It changed yesterday. Like it's not, it's not staying the same. So I think that curiosity is really important. And can I just, um, embarrass Jim a little bit, because the first way that I met Jim, I don't know if it was like five years ago at this point, but I wrote some article about, I don't know something about Amazon and he out of the blue didn't know him at all, just LinkedIn messaged me and said, Hey, can I talk to you about e-commerce like, he just had that curiosity. And he was like, raising his hand. I want to do e-commerce for my brand. Um, and so it's just that curiosity, it's that seeking out other people that are like-minded to, to brainstorm, to talk about these things, that's how we learn. And so that's, I think everyone on this call and probably listening in has that curiosity, mindset and Maca gave everyone a lot of good interview tips. If you're looking to interview a leader at your company about what, what to hire for, because those are, you know, that mindset, that test and learn mindset that, you know, curiosity that like desire to, to not be static.

Maca :

I just want to add something to what you're saying, actually, um, on our B when we're hiring for e-com, uh, many times we hire people that are not part of e-com, but they don't have econ experience. And the reason why we do this is because we want fresh eyes and fresh minds. Right. Because once you're doing something for a while, you're sort of, it's very easy for the human mind to, you know, just go and do what you know, and where you feel comfortable. Right. But we all know that's not where the success is going to come from. Right. It's from change. So having someone that comes in and looks at things differently, that's where, you know, you grow your experience, like your experts, your team's expertise, right. It's like, Oh, actually we hadn't thought about it that way. Or like, Oh, right. Um, so I mean, it's funny because when we, when we recruit, sometimes HR will ask me like, okay, and what experience do they need to have?

Maca :

And I'm like, that's a tough one because I don't really, that's not my number one priority. When I think about who I want to hire. My number one thing is that they're proactive. I want people that are curious, proactive that are going to come here and be like, what else, what next, what else can we do? How do we continue to grow this business? Um, so, so many, so I agree a hundred percent with you. Uh, it's, it's truly about having motivated people that are curious, curious, I think is the number one thing that we look for.

John:

Yes. And I would just agree with that mindset too. It's like, I've found that when I was at a challenger, very small challenger brand, and there were certain ways we were just doing things. And then once I was acquired by a large, much larger company

John:

And then spoke to folks at much larger companies, they had all done it a certain way. And it was completely different than the way we had done it. And, you know, we were, we were at an, and, you know, market, your thinking, your thought process is so refreshing to hear that, like, that challenge, that thinking mindset all the time and not just hire people who are just retreading the same thought process. We got a question in the, in the Q and a immediately after Maca finished talking, where do you get those interview tips? Are they written down anywhere, Maca versus outsource versus get a job at RB [inaudible] and resumes?

Peter:

We'll try to pry them out of Margaret at some point, maybe. But, um, so I have two things on my mind. Uh, and one is from another question that came in on the, on the platform. Uh, and I don't know whether this is whether there are too many answers to this or it's too specific, but I think it does go to the testing and curiosity mindset . The person has, what is the best way to AB test using the Amazon platform? Is that an answerable question? And if so, I see, I see, uh, that Melissa you're nodding your head. So let me, let me turn it to you first.

Melissa:

Yeah, I think that, I mean, first of all, I mean, most people I worked at Amazon for 10 years and Amazon is one big web lab. It's one big test. Everything is an AB test there. Anytime you release a product it's AB tested. So there's this big, like test and learning mindset. And we're dealing with this from a, I really think it's important to have technology to AB test because to be able to it's constant experiments that you need to run. So like, you know, first is like setting, teeing up. What's your experiment? You want to run? What, what is it? Is it an incrementality? Is it, you know, what's the relationship between paid and organic position placement? You know, like basically, like, what are your, what are your tests that you're going to set up? And then you use technology to be able to set those tests up because you have to be able to measure it in a scalable way.

Melissa:

And so it's really just teeing up, like, what do I want to test? What's the way that I'm going to do it, whether it's, you know, like just all the KPIs and analysis, all that kind of stuff, but, but the really critical part. And I think that Maca, you probably run a ton of tests and learn, right? Like you're always kind of testing, but so you probably have some good ideas, but that's the thing that we're doing on our side is working with partners to model, you know, what are the things that we want to test? And the things that we're testing are what's the right item to advertise. Was there an ASEN like, there's really complex things around that, which is like your competitive set, your ASP inventory level. Like, there's just so many variables about that. Um, so being able to test like, what's the right item, um, I want to be in slot one, uh, I've heard this one too, like salt one's too expensive. So I want to be in, well, we can test and learn. Is that really true? Um, does it make sense for you to win a slot? Like all these kinds of questions that you're asking you, you tee up the test and then you, you execute, run it, you define your KPIs and there we go.

Peter:

Um, and so I want where we are so running towards the end of time. So, I'm going to GMI. Can't let you go without, um, without talking about how you evaluate specialized agencies since you use them, what are the ways in which you think about, um, who to engage with and what's your, what's your sort of evaluation list?

Jim:

Uh, I mean, it's, uh, we don't really, we don't necessarily set KPIs on like, uh, on a total level. I think it depends on every single like product line that you're running, you know, the brand, um, the goals of each of those campaigns, um, you know, I've, I was lucky enough to find an agency and I haven't moved away from them, um, since, uh, because, uh, every, every sort of, uh, you know, everything has been fantastic. Um, but, but, you know, in terms of, you know, I think we were talking about before, um, just general KPIs and, you know, what are my KPIs, because my KPIs are their KPIs. And, you know, I think I'm very happy that just generally over the past four years, we've moved away from that eight cost Roaz model of people talking about, you know, uh, my RA's is $30, uh, to now, uh, having actual, um, KPIs that are, you know, for us, it's about recruitment.

Jim:

It's about conversion. Um, it's about shared voices. I think Chris Perez has been preaching for a long time that, you know, the secret to ecomm is spending more than your competitors, and having more shares of voice. And if you were doing that before, COVID hit before this, this huge rush to online that you grabbed a very disproportionate share of that growth. And this was, this was the case study and how in, in, in what that does. Um, so I think, you know, I think the goals are the same and they're helping us achieve those goals. Um, and that's how I evaluate them.

Peter:

Anyone want to, um, echo or

John:

It's like we talked earlier about curiosity and connecting to other people and constantly sharing information. Well, Jim and I have been talking for years and by the way, we competed in beverage brands, but we shared information all the time. And how did I find good agencies? It was Jim and, you know, people like you, your network is everything. I talked to Melissa, you know, we all talk and it's like, we share information about what's the best of the best, and who's doing it better than anybody else. So it's part of that networking process and constantly being curious.

Peter:

And I'm so grateful to all of you for doing this because this isn't a fact, although it's not one-to-one networking, it is networking on a broad scale, like bringing, taking the time to bring your experiences to a broader audience is such an incredibly generous gift in a really busy industry. So, I mean, the DSI remains grateful for anyone that's willing to show up and put the kind of prep and thoughtfulness into something like this before I go, I do want to, before we, you know, that'll let you off the hook of all this, but, um, I wanted to ask John, cause you talked about one of the important things that made you successful at buy in. And tell me if I'm putting words in your mouth or not, was that you owned both sides, you own trade and you own brand. Do you feel like that's a model that's almost necessary in order to succeed and be agile enough to win? Or how does an organization that isn't combining those kinds of make that vision happen?

John:

Well, I mean, again, post pandemic, I mean, Jim just pointed to this, like the change that has happened and the omni-channel effects that again, Chris and Molly and the digital shelf Institute has been looking at, you know, I, it's a question I've asked is like, and I see this challenge at my, some of my brands when you have, e-com siloed with its own KPIs that are bottom of the funnel. And then you have marketing way over here with mid and upper funnel awareness. And they're, they're battling over budgets or competing with each other. I mean, it's crazy. It's been a question that I've asked. It's like, you need some sort of tight connection. I'm sort of recording as much better because they just rock it. They have a better RBS, a better way of integrating it, but I've seen that challenge at many large organizations is how do you integrate do this when the world has already moved to the, to an omni-channel together world. So

Peter:

Jim you're nodding,

Jim:

No, I fully agree.

Peter:

Great. I want to, I'm going to close this out really again with just gratitude Maca. Thank you so much for joining us and sharing your perspective.

Maca :

Well, thank you for inviting me. It's been great.

Peter:

Yeah, Melissa, as always has a big brain and a great heart. We are so appreciative.

Melissa:

Thanks for having me great,

Peter:

John, of course, as always. Thanks for bringing your experience and joy in this business.

John:

Good. Awesome.

Peter:

And Jim, thank you for teaching me how to pronounce, um, Vida or Vida in different countries,

Jim:

Whatever, whatever you want to call it, as long as you don't buy our competitors,

Peter:

I call it what I call it. But seriously again, thank you so much for contributing to the DSI community, uh, to all of you out there. If this debate is illuminated and illuminated, anything beyond the main point is that brands taking advantage of the new digital first opportunity is going to rely on leaders, having challenging and important conversations within and across teams and key partnerships.

Peter:

So joker Stan, who's an expert speaker, author and advisor on organizational diversity and inclusion is joining us to offer brand leaders the latest techniques for modeling and encouraging candid conversations in a time of rapid change. I know sometimes it's easier to sign up for the sessions that are about the KPIs and how I fix this. But so many of us are going to rely on each other and be candid. And so I, I hope you might make the time to join us. It's on Thursday, November 19th at 1:00 PM Eastern, we'll have a link to sign up for the session in our follow up emails. So thanks again to the panel for joining us for the great debate and thanks as always for being part of our committee.