Jason & Scot Show Episode 126 American Eagle former CDO Joe Megibow

A weekly podcast with the latest e-commerce news and events. Episode 126 is an interview with Joe Megibow, former chief digital officer at American Eagle Outfitters.

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We caught up with Joe Megibow at the RetailNext party at ShopTalk this year. Joe is the former chief digital officer at American Eagle Outfitters, he’s also served as President at Joyous.com and General Manager for Expedia.com.  We talked with Joe about his impression of ShopTalk this year, his early experiences in the e-commerce industry (including at TeaLeaf which was acquired by IBM), how American Eagle thinks about Omni-Channel.

About RetailNext Conference:

Retailers and brands at scale can apply for a complimentary pass for the CommerceNext conference – The Summit for Next Level Customer Acquisition – Jul 25/26 2018 NYC.  This show is a combination of strategic keynotes from the likes of (Amit Shah – CMO 1800flowers; Sid Jatia – VP, Global Commerce at Under Armour; Charlie Cole, Global Chief Ecommerce Officer and Chief Digital Officer, Samsonite/TUMI, etc.); and tactical ‘how-to’ speakers like Amy Africa (CEO, Eight by Eight) and Facebook expert Emily Hickey.

Announcing the CommerceNext “Nexty’s”: A new peer-reviewed award program identifying and rewarding the best marketing performances among retail and eCommerce professionals. Awards include “Marketing Innovator of the Year” and “Highest ROI with the Least Resources”. Visit commercenext.com to nominate a fellow retailer for an award and to apply for your free conference pass.

Episode 126 of the Jason & Scot show was recorded on Monday, March 19, 2018.

New beta feature, Google Transcription:

 

Transcript

Jason:
[0:25] Welcome to the Jason and Scott show this episode is being recorded on Monday March 19th 2018 I’m your host Jason retailgeek Goldberg and as usual I’m here with your Scott Wingo.

Scot:
[0:39] Hey Jason I’m walking back Jason Scott show listeners we are here live from the shop talk show in Las Vegas and are one of the hottest parties at shop.
Scott Silverman in Allen Dick’s Commerce next party this party is a who’s who of the digital Commerce crowd.
A couple of housekeeping things before we jump into a visit with one of our guest here who we plucked out of the party so.
Little thank you for the folks at Commerce Max they wanted to let you know that retailers and brands that scale can apply for a complimentary pass for the Commerce next conference.
That’s going to be the summit for Next Level customer acquisition held July 25th and 26th in New York City.
The shows a combination of strategic Keynotes from the lights of 1-800 Flowers and Under Armour and then also tactical information from Amy Africa and Facebook.
Facebook expert Emily hickey there also starting something called the next these which is a peer-reviewed award program if you’re interested in learning more about that go to Commerce next.com.
Jason were excited to have on the show Joe megibow Joe has had a story 20 year history and Retail and e-commerce including on the retail side American Eagle Outfitters Expedia and hotels.com.
Then he has been on the vendor side like you and I are today over a tea leaf IBM and is currently operations advisor with Advent International that’s a private Equity Firm that has a portfolio of retailers including Lululemon welcome to the show Joe.

Joe:
[2:04] Thank you I appreciate you plucking me out of the party.

Jason:
[2:07] We were thrilled to get you.

[2:10] Usually we start at the show by kind of getting a quick rundown on guest background and how you came into the e-commerce industry in your case this could be the start of a long answer.

Joe:
[2:24] Okay I’ll try not to make it too long.
I’ve been in been in the internet or really webspace since since it began actually started as a.
Engineer so I I find some of us in e-commerce based came up from war of the traditional retail merchandising route others came up the technical route II came up the technical route.
And I was in the web early days good friend of mine and I worked in a Advanced Technology Group for a manufacturer actually in Upstate New York.
And those days we we still coming to work every day with one question we asked each other.
Have you found any new websites because we’ve been to all of them.
And wished we literally had a noun or a little modems at the time hitting the early days of the web so I.
Yeah I’ve been fighting the fight on trying to educate companies and organizations on what this thing is about and how to how to embrace it as something other than a sideshow novelty since since it began.

[3:27] But I am.
Ended up in management consulting for number years help launching e-commerce practice for one of the big Big 5 consulting firms ended up at interesting little start up a company called Tea Leaf technology.
Tea Leaf back in the day was way ahead of its time but we we realized early on that just basic.
Numerical tracking of what pages you had been on what was often called his web logs just wasn’t enough for a truly understanding.
The ladies are experience a customer experience and we had come up with some novel technology to allow you to see everything that was happening with the customer and it in retail it’s not that different than say.
Going into the store and Walking the Floor something any good retail executive does they go in and watch the customers and see what’s going on and see what’s working and what’s not and speak with them.
And there really wasn’t an analog for that online so we we built some initial technology to do that.
For me personally what was amazing about it is 4 years working with hundreds of a transactional companies.
I got kind of a front row seat on seeing what really work.
And what really didn’t whether we’re talk to human factors human psychology understanding why is it that.
So many websites at the time just kind of shocked and head was just really hard to get things done friction issues getting in the way that’s a lot of the stuff was built by engineer is not.
By people who understand human so I did that for a lot of years ended up an Expedia for 6 years running a number of things ultimately running the expedia.com us business.

[5:02] American Eagle Outfitters for 3 years running digital there really at their transition tree. Of being.
A great brick-and-mortar store but understanding not only getting e-commerce right but truly leaning into an Amish handle experience should I happy to chat with you guys about and.
Stood up for about a year did an interesting start up with a joyous a video based e-commerce retailer and what I loved about that was the focus was bringing the Humanity online just how do you control a.
Help understand what makes a product great outside of the traditional just grid and content view of a products which we ended up.
Selling the company hand doing advising and Consulting now.

Jason:
[5:45] That’s awesome nice concise recap of an amazingly Rich career.

[5:54] TV this is super exciting to me cuz for the Wizards.
I’m familiar it was a real game-changer like I sent you yet records sessions so that site team can watch Shopper behavior for.

[6:09] Learning about conversion optimization and an opportunity to improve things and also for troubleshooting problems so before that like.

[6:17] Your sales would be way down on a promotion day and you really had no way to know if you look at the metrics and see that nothing converted but you really have no I didn’t see that like.

[6:27] You are losing customers at this form or at the.

Joe:
[6:30] Yeah we and it was interesting we,
like I stumbled onto some insights just again trying to figure out why did conversion not hit the numbers we wanted like one of the early observations we had we ended up creating a kpi around this week all the PSR purchase success rate.
And it turned out we were looking at this was in my in my travel days but it’s it works in in retail as well.
We knew what the fall off was on the traditional funnel I mean when you attack of conversion rate in the in the funnel.
We knew that they were getting to the last step in the process but the Fallout you expect if someone’s going all the way through the checkout process that you have a very high percentage of people who then complete the transaction and it was it was not it the high-percentage we thought.
So why are people dropping out and with no one had figured out at the time and what we stumbled into by looking at this more complete view of the data is a ton of people were in fact trying to.
We just weren’t letting them and whether it would means that the transaction was failing.
It was for a whole lot of reasons account failure where the credit card not being processed or incorrect information on doing the verification on the credit card and it needed you know somewhere between 1 and 5 + 1 + 4.
20 and 25% of the people may think about this you walked into a store you browse around you found something you want to buy.
You’ve actually gone through the process you gone up to the POS you’ve gone through this and I’m online it’s much more challenging.

[8:00] My home address and my information my credit how you typed all this and you’ve actually clicked the button complete transaction the please take my money I want to do business with you.
And the response was no you no soup for you tonight and it’s it’s it’s crazy in the end the.
Recovery rate on this was very low as well and you don’t step 1 and in fixing things is acknowledging the problem and we were measuring the wrong thing we didn’t even realize that was a failure to measure and.
Yeah we’ve we turned out you never get to 100% purchase success rate some people always have credit to clients.
But the ideas how do you actually look at that make sure anyone who should be complaining a transaction.
Let him complete it and get that up to the high 9 days which took months of work to fix but no one again it’s like turning a light on in a closet it’s been dark with never even seen that.

Scot:
[8:52] Then I’ll wear your Expedia when they were part of interactive Corp or was this.

Joe:
[8:56] This was shortly after I see spun out all the the travel properties which was a collection at the time of Expedia hotels.com Hotwire TripAdvisor,
since I laughed the acquired orbits Travelocity and then the number of the other players.

Scot:
[9:13] Some ways to travel world even then but even today was kind of a couple Generations ahead of us and e-commerce World about.
Current traffic monetizing it always amazes me how they’re they’re totally friendly with each other and always routing traffic through each other in a much different world than we would it and e-commerce.
You’ll see Amazon cycle traffic over to Walmart or something like that.

Joe:
[9:33] I know and I think that’s actually how I ended up in retail is.
One thing about travel for sure it’s a great experiences and it’s not about the transaction I mean it’s ultimately about the trip and the places you’re going and,
I I think some of the players are realizing what I think travel is crossed over into retail lives that yet travel was.
It from A disruption standpoint 10 years ahead of retail but was still deeply consumer-focused.
What was interesting to me going from travel to retailer really from Marketplace two or more vertically two-player as a lot of the tricks that I expected would work didn’t work at all in retail.
And it was some some fascinating learning so you one example is the funnel.
I’m in bed the oldest trick in the book if you want to like make them more quickly it started the bottom of the funnel and start working up and find the people who are the most qualified most committed and what’s not working find that friction rooted and it’s free money.
And in a fashion apparel retailer American Eagle didn’t work.
I am going I mean he joined a new company and you pull out your playbook that always works and it doesn’t work it’s sort of this oh crap moment of what have I gotten myself into.
And the internet turned out in a in a fashion business it’s an upside-down funnel.
The consideration where they fall out is at the top of the funnel it’s discretionary spend I’m trying to decide.

[11:04] I need a new pair of pants I need a new top what am I going to buy at you you hope you have loyal fashion brand followers.
The reality is even your most loyal customers still don’t exclusively shop with you so when you’re in that consideration said you’re at the top of the funnel.
They’re deciding hey what’s new with trash was out there that’s when the Fallout occurs by the time they’re at the last step of check out.
Big decided I’m giving you my money this is the the transaction I want it if it doesn’t work it turns out though actually that is a different elasticity will try again or go to the store.
The call the call center there’s a much higher probability you’ll get this a lot but then the flipside happens which is at the top of the funnel.
If you are not getting a ride especially if your vertical integrated if you’re the only place where can I buy the product that’s where it really matters and we ended up switching everything around and then how do we make sure we’re educating on the brain.
I can give you the right information without relying and Associates in stores because that’s where the Fallout was occurring fascinating difference.

Scot:
[12:09] Search more detailed product pages more serendipitous Discovery stuck at the top tell people at self-educate.

Joe:
[12:16] Yeah I hardly I am I looked the stores a lot for inspiration and it’s kind of a digital guy I think it’s easy to fall into hey we don’t need stores or.
But there’s a lot about stores that work really really well and have for decades that I have yet to see online replicate.

Scot:
[12:33] The bigger shopping cart.

Joe:
[12:35] Other interesting Lee there I was fascinated when I joined that but a lot of the apparel companies use the notion bag and not shopping cart and I was frustrated by this.
I actually sat down to prove that we were getting a wrong and then I discovered every apparel company use bag which.
I think it’s all just a bunch of silliness it doesn’t really matter but but if you walk into a retail store.
There are people there there are Associates their customers and you get a vibe from this within seconds you know if you walk into a restaurant or store if you’re in the right place how hit me up if you’re a straight-laced person and you walked in and saw a bunch of.
Bikers wearing leather and whatever you feel like this is not my scene where you walk into a place that supposedly popular and it’s empty.
And you see this what are people shopping what are they buying what are the associates doing how are they engaging is it is it a heavy cell is an inclusive is an exclusive and you pick this up almost free.
Online it’s kind of like saying find me my flagship store.
Perfect inventory position perfectly assorted perfect graphics and displays but you walk in at 2 a.m. on a Sunday when nobody’s there you’re on your own.
And that’s that’s most shopping online and this is a huge gap and helping people discover and the Serendipity of shopping this is just not been figured out.

Jason:
[14:02] Said you feel like you have you run into any tactics that you think partly address that cuz it’s.

Joe:
[14:07] For sure I think and it’s all just little Windows into the human psychology to try to solve these things and then sometimes it can be a very subtle ways one of the biggest lips we got back of my travel days.
Wait we called it a sense of urgency messaging but the idea was you’re not allowed in part of the inside came from the number one call to the call center.
Was a simple question that needed to be answered was just is this hotel room going to be okay just it’s a big expense it’s going to be a bad Hotel it’s kind of ruins your vacation.
And we we put these little pop ups on the screen which were just 10 people are viewing this hotel right now.
15 people have booked this hotel in the last 24 hours the last hour.

Scot:
[14:50] One room left.

Joe:
[14:51] One room left which is sense of urgency but one more popular people are here right now and it was just anything to give that same replication of that store experience.
It’s popular you walk into a store and there’s a popular item on the ground or at the front door on display and there’s only one left in your size and your smile what do you do.
You grabbed it off the rack and you hold it you may not buy it but it is my option to choose I’m going to hang on to this thing until I decide I don’t want it so how do you create that same sense.
Requires being there and seeing other people around and knowing the scarcity of the item how do you create that same sense online send me that just one example of like a digital proxy for creating that that we’ve done.

Jason:
[15:34] Yeah it is interesting I call that the sort of first Shopper problem cuz everyone that comes with e-commerce side feels like the first shopper.

[15:42] It’s ever been on that site like there’s your point there’s no footsteps of those previous customers.
I started my career in brick-and-mortar retail and I was looking up to work with this legendary visual Merchant this guy named Joe was sheer and he used to.

[15:59] Do the most amazing product displays all would like way higher conversion than any of his peers.

[16:07] And the coolest thing he ever taught me is like you do this beautiful visual display and then the last thing you do before you open the store.
Is you randomly take three scuse off that display.

[16:19] Cuz no one wants to walk in and buy you know how to take that first SKU out the pyramid and feel like they’re the first one to make this risky purchase they want to feel like.

[16:28] Man that was just a customer here ahead of me and grabbed it.

[16:33] There’s this they’re out of business now on Saturday but that jackthreads these type of my favorite features that used to.

[16:40] Expose their there like high-level analytics on the product detail pages so I can you could literally see like five thousand people looked at these trousers and a thousand of them.

Joe:
[16:53] I ate an educated just trying to replicate I eat you talk about product displays I think another interesting test we did that worked out rather well so we.
Is there very tight control especially from the merchants in the product owners on how you display product online.
Yummy you want this to be the best presentation of the product and lizards lay down or lifestyle shots are on body but how do you really bring this product life and make it be true to the Brandon to the product.
The challenges it’s in at 8 that off in 3 aspirational it’s reaching people want to know how’s it going to be.
I need a store again you get that for free because other people are in the store wearing the product whether it’s real humans were Associates or whether it’s other customers you can get a sense of how the product.
So am I in where you often have is your social feeds that you’re getting photos posted Instagram information based marketing.
Tag my brand include me in the conversation get it up there but this stuff is off and relegated to a blog or style board or somewhere off on the side where if you true to be that brand customer to look it’s interesting.
But it’s very disjointed from the shopping experience so the idea was how could we make this part of the product experience twins on the product detail page not only do I see the grade.
Produce Merchant LED photography but let me see the real user photographs as well.
Which man tagging them flowing through so they came into the product detail page but it created tension inside of retailers because it now I’m giving up control on house.

[18:25] It’s not you and not everyone do consumer truly represents that idealistic brand standard and and how do you reconcile that but what was interesting is.
It kind of credit just in these are my words become a book end.
Approachability you’ve got the very perfect on point brand beautiful people who show the product and the aspirational luck you know I want to look more like that.
But then you saw a real world people who showed you this was approachable achievable I can do that.
If they can wear that I can wear that I’m going to look good and enjoy giving it that grounding and they’re the real you know that this is real people wearing real product alongside having sort of what the division of what you want to look like.
Turn up work really well and you know and then to change how we approach things and then the idea was truly let’s get this real user.
On as many product pages as we could and do that in an automated systematic way but again to me it’s just it’s just tapping into that human psychology of bringing the real world experience.

Scot:
[19:29] You guys were very early on mobile to because your audience being Millennials was like really pushing that are any interesting insights that you learned kind of.

Joe:
[19:38] We we did a many many many and I’ve been I’ve been passion about mobile so I Expedia we had the first Transit.

[19:49] Psych on which we launched on the iPhone when it came out we had one of the first.

[19:56] Best for Bravada years.

[20:03] But I would have never guessed so we’ve got this at American Eagle we have an app it does pretty well it’s it’s our loyalty program.

Scot:
[20:09] I need the address.

Joe:
[20:11] Customers and Maya my head of mobile at the time who’s been in the mobile space since since the old.
Days he he’s hammering me for let’s put radio in a rap music.

Scot:
[20:24] What am I cramping.

Joe:
[20:26] Brand experience.

Scot:
[20:28] Stores.

Joe:
[20:29] We had a partner who could be relatively low.
Classic basic.

[20:36] Free.

Scot:
[20:37] A lot of my life playlist.

Joe:
[20:41] It just didn’t seem that important to me.
Finally thanks Jeremy he he just wore me down and he’s like I got it I’ve actually already.

Scot:
[20:49] Actually already done.

Joe:
[20:52] Due diligence you just got to say yes and it’s going to be.
Any apps and we put in a nap and some amazing things happen.

Scot:
[21:01] Customer.

Joe:
[21:07] They hated it but for reasons that were more comical to me they love the music as well and they said and they turned out they were good customers of ours,
and they using.
Like I can never leave this.

Jason:
[21:20] Score now yeah.

Joe:
[21:23] Store and I’m like oh that’s that’s actually when you know that’s just kind of hidden in a complaint but he was the interesting thing when we started getting into the.
And we were very religious I’m looking.
At the metrics and how all the opolis Performing the uninstall rate.

Scot:
[21:39] So we would look at my coworker.

Joe:
[21:40] So we would look at my cohorts of 7 days out how many people still have the app installed dropped in half we had twice.

Scot:
[21:47] Install.

Joe:
[21:50] The average session duration everything we were saying massive Improvement which also meant are rank improved and in.
Because the number of downloads weren’t changing and yeah there’s always been sort of thoughts on hey is a.

Scot:
[22:05] Engagement uninstall Ray.

Joe:
[22:11] You’re busy chat just it was a better app.

Scot:
[22:13] And we were not only were born.

Joe:
[22:20] Former warden in range and guess what rank is more download the engagement and there’s a virtuous cycle there so yeah it’s a stick.

Scot:
[22:28] Traffic getting into tonight.

Joe:
[22:31] Before and giving them what they need.

Scot:
[22:34] We have some beginning marketers on the show talking about cohort analysis and I think that’s an interesting topic and you probably have done enough of this year I have like your favorite view of that.
So maybe it’s a pretend you’re talking to someone that you know is just getting an e-commerce.
Somewhat technical on the marketing explain cowardin Alice’s we can use the app. I know there’s a lot of nice ones explain that and then maybe talk about some best practices using.

Joe:
[22:58] Sure I may take it up a level I just say.

Scot:
[23:01] How to say how do you say before eating.

Joe:
[23:04] Analysis it means to have clean data to understand who my customer is and how can I start.

[23:11] It’s a fancy way of just looking at groups of people and comparing them typically overtime so you can.

Scot:
[23:15] So you can understand it’s something worth.

Jason:
[23:19] You can charge more for a cohort then you can for a.

Joe:
[23:23] But I ate nothing scares me more than making really good decisions on bad data and I think part of the challenge and I think this is getting harder not easier is how do you actually.

[23:41] User Axe and I’ve got Bob or Susie out there and who is.

Scot:
[23:44] Who is Bob Mackie what have they done so I can come over.

Joe:
[23:51] In a world where.

Scot:
[23:54] I got more people going.

Joe:
[23:56] But still transacting a desktop may I mean think about this most people’s mobile conversion of 1/2 to 1/4 of what their desktop site is and if I were.

Scot:
[24:04] Basic now and oh by the way mobile sound 50% the majority of my business is going to be.

Joe:
[24:13] A half or a quarter of my traditional business.

Scot:
[24:17] My business.

Joe:
[24:21] So there’s a paradox here which is.

Scot:
[24:23] I am I not getting my business completely call Omar.

Joe:
[24:27] Where the basic metrics are true and really what it is.

Scot:
[24:31] If people are coming your side 3 times.

Joe:
[24:35] Purchase now they’re going twice on mobile and once on desktop and oh by the way my desktop conversion you know which I attribute.

Scot:
[24:42] So glad of that stalking her for not being able to.

Joe:
[24:53] Because the way most of these.

Scot:
[24:54] Looking.

Joe:
[24:56] Where did I see you first and where the transaction occur and if you can’t connect the dots and say hey I saw you on.

Scot:
[25:00] Can’t connect the dots and say hey I saw you on mobile but I don’t know who you are.

Joe:
[25:05] Find ways to tag remark you but then you.

Scot:
[25:06] But then you transact.

Joe:
[25:16] Stop channel it’s digital to store it it’s a challenge.

[25:27] Good am I think it was an accident.

Scot:
[25:30] How do I increase my customer identifier.

Joe:
[25:37] Be getting them to log in or getting to engage with a promotion so long before you get into cohort guidance make sure.

[25:47] How am I getting consistent measurement how am I attacking some of the consumer data problems which is a really big deal if you can get there and you know.

Scot:
[25:55] Tricks that you can do.

Joe:
[26:00] What you can do on testing thing.

Scot:
[26:02] Two different audiences information variation sometimes.

Joe:
[26:13] Can be great on hey if I give someone.

Scot:
[26:15] How often do I see one.

Joe:
[26:21] 2 Days Later 60 days later and tell her it’s going to be in a very.

[26:26] Way to look at that.

Jason:
[26:29] Very cool and you you touch on another topic is very near and dear to my heart.

[26:34] Talking about attribution omni-channel attribution American Eagle owns a lot of drone stores that website I presume was sort of the flagship store.

[26:48] The front door too many of those physical sores often like did you guys Implement any kind of omni-channel attribution or headed you think about.

Joe:
[26:56] We we did a lot around on the channel That the marketing attribution was trickier for us and it’s some of it was just reframing the question I am like to say round numbers that we were doing.

[27:12] Which means oh by the way 75%.
Wasn’t online and if I’m the CIA.
Company and I’m looking at how I’m really thinking about what’s really in a driving my.

[27:27] It sure looks like stores no matter a lot more and on.
Basis certainly that was mathematically true but I refrained the discussion we had cameras and all their stores and we could.
Into the stores in at the mall level what if we looked at this differently and said look at this from a consumer engagement standpoint how many people said put into our stores everyday and how many people set foot in our digital.
One thing is.
What stores are not buying the product and then I tried to Apples.
It’s us us brand brand stores don’t know no uniques it just no sanity.

[28:10] Let’s take not unique’s just total visits and you don’t find a way to do it.

[28:15] And the interesting thing was it wasn’t 75/25 now it actually flipped and it was more.

Scot:
[28:20] 73rd Avenue.

Joe:
[28:23] Depending on where and how we were looking at it with the majority of our daily.

Scot:
[28:26] What actually is.

Joe:
[28:34] Which means you can see.
The people walking into the store where already online the majority.

[28:45] Putting it in information on non offense.

[28:53] And that actually was a profound shift Ross’s beginning.

Scot:
[28:55] Beginning of recognize.

Joe:
[28:58] Point isn’t still years away when we’re 50% of transactions the Tipping Point already occurred this is the primary channel for us to reach and engage with the customer.
Do you want to give it because if I would.
And online fully was realized by the person coming to the store that also means that store isn’t as important as we think it is.

Scot:
[29:20] Crediting on sale.

Joe:
[29:22] And it starts to get very very tricky in understanding how I’m going to really be.

Scot:
[29:27] How am I really do that with you no more.

Joe:
[29:30] Credit and entering.

[29:34] So I ate it becomes a bit of a soft skill I think for now and connecting the dots that way where we could measure things in a single-use coupon codes and showing where the activation actually occurred or even if the inventory management I mean for us the biggest win on the channel.
It was how we exposed inventory with things like buy online ship from store which.

[29:57] But I’m in that was massive massive winter for.

Jason:
[30:02] So like what were the big omni-channel experiences go to Wings for you you mentioned ship from the store.

Joe:
[30:07] Is it shipping store for sure was a lot of it and if you think about it we we had a couple DC’s.

[30:15] Popular but it’s always a limited Supply so the idea that hey we have an item that’s no longer our current sets you can get.

[30:26] Not right it’s still a great product and still relatively recent but it’s only available in extra extra large.

[30:34] But the idea that we actually have a unit.

Scot:
[30:36] Somewhere are awesome store.

Joe:
[30:38] Of that item is pretty high and at the local store level which is just very very Atomic view of managing inventory whatever assortment they have.

Scot:
[30:47] They’re just.

Joe:
[30:49] Down 10 off 25 off move it to the back and then ultimately if they can’t get it they’re going to liquidate it out of the store so the idea was just simple it was how do we.

Scot:
[30:58] Can anybody any.

Joe:
[31:01] Existing inventory roofing supply against existing demand and it turned out to be way bigger.
When we began we didn’t even know what we do this in all stores we only pick a couple hundred stores and by the time we were done it was fleet-wide every single store became it.
And it was a win-win we were given.

Scot:
[31:19] Give me the.

Joe:
[31:21] Customer demand.

[31:25] Our margins were actually dramatically better because we were able to move stuff much earlier in the in the in the mall.
And by the way just even you can talk about with your.
May I have a foundational belief that the notion of e-commerce as a p&l will be gone within 5 years ndia like to do this on a channel exercise we did with buy online ship from store so what if you look.

[31:51] In order to make sure the stores were truly giving a pro.
Disorders we gave the stores credit for the sale we won.

[32:02] Really great job which they did on for the like that so they’re going.

Scot:
[32:06] What is 5 *.

Joe:
[32:09] Clearance merchandise.
Eroding because we’re increasing the frequency of sales I had a clearance item that’s operating cost for increasing split you.
Shipping more out of stores in general which does the the shipping an operating cost of shipping out of stores is more expensive expensive than what we could do at the distribution center and I had to manage a whole new order management system and.

[32:34] My product more guns are all getting worse.

Scot:
[32:35] Chris sails.

Joe:
[32:38] Credit in stores are looking good and you know how you can just took an e-commerce piano of you you’d say this isn’t work.
Company level me if you think what’s the definition of omni-channel with all channels we were saying increase sales we were saying higher transactions were improving on margins the lowest liquidation rates and even.

[33:03] And it just come Sunday if I’m standing in a store and they don’t have.

Scot:
[33:04] And they don’t have to talk on my mobile phone.

Joe:
[33:08] 70 Commerce a list or sell if I’m if I’m at the store if I’m on the.

Scot:
[33:16] Very very boring day at work.

Joe:
[33:19] And I think it’s missing the point cuz the notion of trying to create a channel is Disney on.

[33:28] They don’t care they’re just engaging with.

Jason:
[33:30] American Eagle sale.

Joe:
[33:33] I think it’s the wrong question and I think brands are slowly coming to grips with a chop block here it’s one of the most.

Scot:
[33:37] Hookah Bowl think I’m hearing.

Joe:
[33:42] I think brands are finally recognizing this isn’t about a different Channel or different approach or different tea and that’s how do we really start to take this consumer-centric View.

Scot:
[33:52] Could you think stores last long enough to get to this point where they rationalize the piano at Toys R Us didn’t make it in the players and a lot of these guys are filing for bankruptcy now.

Joe:
[34:00] Yeah I I don’t think stores are dead I’m very bullish on stores I just think stores are going to be different and they’re no longer just about convenient places to store inventory.

[34:12] I think the square footage will change I think the purpose of Discovery and and the serendipity.

Scot:
[34:19] Experience.

Joe:
[34:20] Brands will change but we’re social beasts were looking for that human connection will look.
And I think Associates do a great job in the same day and I’d say online is going to become less mechanistic and we’re going to bring more humans then I am a big fan of things like chat.

Scot:
[34:38] About ARB Rd to Goldfield storage Grove totally virtual reality.

Joe:
[34:42] I am yeah you know I I I think there’s going to be opportunities and their categories like furniture that I think I’m very interesting where where a RV are already starting to take hold it’s very interesting companies are going.
I need the idea fit and feel.

[35:01] Content and it’s going to be a lot harder in the immediate future to truly do an ARB our approach for that to me.
Shannon and we keep running the math problems and to me a rvr as its a math solution.

Scot:
[35:19] I’d much rather.

Joe:
[35:20] Solution I’d much rather invest in most call centers have conversion rates of 30 40%.
You’re nowhere near that if I can get people to call and I can understand how to staff them.
For service and get a ton of opportunity and sandwich at when as you get it in the Millennials in the youngers the younger customers they’re very comfortable chat that’s no different than a phone call to them and if I can engage to them.

Scot:
[35:46] How to make silent.

Joe:
[35:49] Commendations where use it works and if it’s the same conversations you have in a store but it requires human beings to know that customer which means good CRM but date about.
10 in training in the associates you can do that digitally at scale it’s just it’s learning and it’s it’s it again it’s blurry.

Scot:
[36:09] Who am I.

Jason:
[36:16] Joe that’s great advice and it’s going to be a great place to end it because it’s happening again we’ve used up all at a lot.

[36:24] I was super grateful for you taking time to sit down and chat with us and as always is westerns want to continue the conversation they’re welcome to jump on it.

[36:33] Page if you enjoyed this episode it’s a great time to jump on iTunes and give us that 5-star review.

Scot:
[36:40] Joe people want to follow you online do you have a Twitter or LinkedIn or.

Joe:
[36:46] You can find me LinkedIn it both megibow and Twitter is megibow m e g i b o w.

Scot:
[36:51] Cool thanks we appreciate you taking time out of the parking and you can go have a drink on us.

Jason:
[36:57] Until next time happy commercing.

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