A weekly podcast with the latest e-commerce news and events. In Episode 183 we chat with Jason Del Rey, Senior Correspondent, Commerce at Recode about his new podcast “Land of the Giants: The Rise of Amazon”, as well as his upcoming event, Code Commerce.
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Episode 183 of the Jason & Scot show was recorded on Thursday, August 8th, 2019
Automated Transcription of the show
[0:24] Welcome to the Jason and Scott show this is episode 183 being recorded on Thursday August 8th 2019 I’m your host Jason retailgeek Goldberg and as usual you with your co-host Scot Wingo.
[0:39] Hey Jason and welcome back Jason Scott show listeners we are really excited this week to have back on the show Jason Delray Jason is senior correspondent
Commerce at recode he’s also produces the industry event code Commerce and now joins Jason
retail geek and I in the pantheon of famous podcasters
he was last on the Jason Scott show on episode way back on episode 67 which was January 17th back then he was senior editor so I guess congrats on the big promotion to senior correspondent.
[1:14] I don’t know if that’s a joke or not but I am I am happy to be back I was going to make a sport Sports Talk radio joke which is second time long time you know.
Okay well we’ll keep going thanks Rodriguez.
[1:34] It’s good to have you back we don’t get to make fun of the next enough so.
[1:38] Oh man it’s going to be a long night.
[1:42] So is it true that your appearance on the Jason and Scott show sort of ignited your whole passion for podcasts.
[1:50] I mean I honestly did not know what podcasting was and then I came in you guys taught me the ropes and how many years later is this I don’t know took me a couple years to like.
Build up the courage and skill set but here I am so thank you.
[2:09] Cool fucking to the club it’s exciting to have you up in the in the in the podcaster realm.
[2:17] Only for a few more weeks but hopefully they’ll be a long tail of listeners that all at all extend the Land of the Giants fan club into the rest of this year.
[2:31] Absolutely and we are going to need that into that but before we get in a Land of giants I want to talk about one of your other projects it’s near and dear to Scott and eyes heart.
I think it might have been three years ago now but you started a series of events code Commerce.
[2:52] Yeah that’s right so we started we started with these one night one night,
what we would consider a live journalism events and we started inside of shop talk I think year one of shop talk
we did a sort of separate one-eyed event within shoptalk that required a separate ticket and it basically 3 hours you know an hour
some ways food and drinks and networking and then usually three or four
what would you like to drink or no BS interviews with.
You know people like in past years you know we’ve had people like Jack Dorsey talking about Square
Katrina wake pre-ipo talking about Stitch fix Mark Lori several years ago and overtime we built that. Into a standalone
today event that’s why we’re going on Year 3000 New York City Standalone event,
that happens every September and so we’re only about a month out.
[4:03] Yeah and so and you have announced some of the the guess you’re going to have for the Cher show.
[4:09] We have so we’ve announced maybe maybe about three-quarters of the lineup which I’m super excited about we have.
Entrepreneur founder CEOs like Jennifer Hyman Rent the Runway Julie Wainwright we just took the real real Public Market Lori from Walmart
Jeff Rader that Co CEO and co-founder Ari’s which has agreed to sell for,
make 1.3 billion dollars.
I cookies in the CEO of Birkenstocks in the US and the founders of away
digital native luggage or they would call themselves as they call themselves travel company,
so that that’s that sort of off the top of my head that those are some of the great guess we’ll have and we are and there’s a few more as well.
[5:09] Yeah that’s going to be exciting away is kind of controversy on the show because Scott is a big fan and Advocate and I’m not so much.
[5:18] Should we got into that now or should we save that.
[5:21] Shirtless Jason took me like 6 years again to buy a four-wheel bag and didn’t even get in a way I don’t I don’t know what he was thinking.
[5:31] I will say that,
we are a I I have a I have a new wish four-wheel bag that was purchased by my wife at
TJ Maxx and so if that doesn’t give it away I’ll just say it it’s not in a way back and it was probably about a third of the price,
but I am very fond of the look of the waybacks and I’m very very interested in whether they are able to do what they say they want to do which is,
build themselves into really a.
Multi products brand that sort of incompetence has all the different types of products you could need or want.
Intrexon sort of in your travel life.
[6:25] It’s honestly like I have a critique of the product and but more seriously of the company like the
the Super Bee product line coming me miss your bag is perfectly fine I travel a lot more than either of you I’ve already been on planes on her 50000 miles of this year
it’s alright it’s like it tends to be worth it to invest in the most durable bag possible and for me that like I really like a bag that can.
Expand into a soft-sided expandable bag works better for me.
[6:56] Yep so what it was so what is your brand of choice.
[7:00] So I might I have a Briggs & Riley.
[7:04] More expensive more durable like I’ve already been with Scott when he was repairing his away bag and you know I would argue I’ve many more miles on that I’ve never had a proper.
But that’s I mean both bags get you get what you pay for with just fine.
And I don’t have a huge could take my bigger thing and you know maybe I’ll get a chance to bring up on in your conversation with Jen.
I visited their pop-up shop in Tribeca and I thought it was a fabulous piece of retail and and you already alluded to it they get mad when you called him a luggage company they like to call themselves the travel company,
and you you go to this pop-up shop and they very much,
Lycra merchandising and glorifying the travel lifestyle so I know there was a lot of like.
[7:58] Memorabilia and stuff that made you you know sort of aspire to go to destinations and you know it felt like the the luggage was helpful enabler of this lifestyle that away was positioning right and whenever you.
You know either founder talk about the company that’s exactly how they talk about it so then they started opening permanent doors.
And the permanent stores are super sterile shelves with luggage on on that like I could replace the away with Samsonite or to me and it would.
[8:34] Exactly the same.
[8:37] Yeah so we will definitely 100%.
Talk about this I think my guess or edit my educated guess is that,
they are going to sedate David they talked about that they’re going to open I forgot what the number is but I believe dozens of stores is the ID across the country or maybe not just across the country,
select International markets over the next few years and I think frankly they are still I think they will read thank.
Their approach but I will let them speak for themselves on,
try to remember if they’re speaking on September 9th or September 10th at Commerce whichever day I know be sure that this will be a topic we dive into.
[9:26] Yeah I’m looking forward to it I will be there and it’ll it’ll be fun to hear they’re there POV I’ll probably check my Briggs & Riley bag so they don’t have to see it.
[9:37] Hahaha well I’ll bring it up on stage.
[9:41] Awesome alone at the exactly.
[9:46] Cool awesome to see what news comes out will be doing a show we always do a recap show from there and let’s talk about your podcasts to land of giants you’ve got the time recording the Masters three episodes out,
it’s kind of a different kind of flavor than kind of what we’re doing here with news obviously suits to tell us about Anna what got you started on this and how you’re laying it up.
[10:09] Sure and then just so just so I don’t know how touchy the search the search functions are on podcast apps I’ll just slightly correct that it’s a land of giants so
people want to search it’s Landon,
Giants and I’ll try to make the backstory quick centrally recode inbox me decide a lot of success with podcast over the last few years my colleagues petercopter Kara Swisher they have phenomenal,
interview style shows but there has been a couple of things going on at the same time but what do this first dish heater Costco
friending how he came to me and said you know
you should the companies looking for more podcast you should do something on Amazon and I was like
okay that sounds interesting and then simultaneously their conversations and other part of the company about an idea.
[11:06] Doing a narrative getting into more of narrative storytelling and podcast there’s not a lot of great narrative storytelling in the business world as a relates to audio and so there was this idea to do a franchise around the fangs
companies and do a season on each company so short of the idea to do something on Amazon
with that interest in the Fang franchise,
call West End for me the timing was for me at all about a couple of other things one is
obviously there’s a ton of discussion around power effect of these right now.
[11:44] NBC in Saucon Valley in the media should I felt like good timing the other pieces
I know you guys know this to from being in the industry,
it’s very easy day today till like worried about the next in my case right about the next product announcement the next business Amazon’s getting into NYU know I’ll have some contacts in my article is but sometimes
you need to force yourself to like step out to the big picture and say like you know,
you know what is the status quo in e-commerce right now like is that healthy what are the what are all the impacts on society
everything this company is trying to do and so I’ve had all those questions in my head for a long time and there’s this seems like a way to I have the time to serve both dive deep and like take a broader look
at the same time so that’s.
So why I can I can I can give a little more detail on what we’re actually try and what we’re actually set out to do with the content if you’d like or I can let you guys ask me whatever you want.
[12:51] So what’s up I want to get to a little more of the contact but just to make sure that our audience is tracking so that the notion is there’s a season about each of the Fang companies so there’s a.
Amazon season I think most people Nothing But Apple Facebook Netflix and Google so it’s actually faang,
that’s the idea you’ll have a season about each of those companies and then you’re you’re currently three episodes into the Amazon season is there a.
Dick by Jordi know how many episodes that are going to be of the Amazon season.
[13:28] Yes oh yes so there will be 7 episodes and there’s a chance that episode 7 will.
Will be taped alive at so Commerce and so if,
is that ends up being the case episode 7 was sort of break from the format we have in each episode so far which is sort of a Storyteller telling a story basically throughout a given,
atopic area involving Amazon and episode 7 would sort of be like a conversation recap of unlike of of what listeners that the Earth were the first six episodes,
and so you can imagine the challenge of trying to break up Amazon’s impact,
and interest into six or seven episodes is not easy and so on in episode 1 we should we try to
the iiibeca by I’m curious what you guys think you know the foundation of Amazon’s retail
rise and dominance to me is Ben Prime and so episode 1 we both have Amazon Executives and employees telling the origin story of how Prime came to be and then we also
get into the consumer psychology of how Prime has been able to walk us walk you know.
[14:56] Over a hundred million people into Amazon’s ecosystem and makes it very hard,
to break out,
episode 2 of I had this big question of like what does Amazon want that you from being inside our homes with Alexa with all the connected devices with ring with Eero with you know.
Basically best smart home and so we exported that question with with an Amazon executive and also.
[15:27] You know some smart people as food asking some skeptical questions about you know what this future of a fully automated home,
I will will,
will feel like in and how that might impact our lives in the future and then third episode which aired so far was that a look at Amazon’s impact on local communities among the big tech companies yeah I would argue that Amazon.
Has the bigger the biggest physical impact on small communities around the around the country because of their warehouse Network,
North 710 now large fulfillment centers just in the US and so we went to a small town in Kansas that which was home to one of Amazon
first fulfillment centers and it was number three or four and where they left a few years ago and then told the story what happens when they came and left
and I’m and then I went to my hometown of Staten Island New York which is home to one of Amazon’s very new,
Jerry automated fulfillment centers to get the taste of.
What the promise is in a in a small community when when Amazon comes to town today I’ll take a breath.
[16:41] Yeah it’s it’s
yes I’ll be curious it’s interesting like I told you to greet you that Amazon has the biggest physical footprint and you know they’re for like sort of physically has the most impact on those small towns some of the other ones are you know much more responsible for,
deciding who are government leaders are and how we really think so it’s hard to know which one has more impact on your day-to-day life but yeah.
[17:05] Totally and then and I should I should say you know yes that’s 100% true you know,
part part of Odysseus or the the emission of of the whole franchise Land of the Giants has been,
you know it is easy in our day-to-day getting caught up in our day-to-day lives work Family Family Life,
you know pleasure.
What sort of what the broad impact on what the broad reach of these companies now,
now he’s in our lives and and that’s not to say it’s all bad I mean it’s a lot a lot of good and I hope that you know will come across in the in the series as well but it feels like a moment in time where,
you know healthy scrutiny something that the world could use a little more us.
[18:02] Close Amazon been kind of supportive of this or they they didn’t really engage on.
[18:08] You know that’s.
You know I have not gotten a lot of feedback from the company since since episode 1,
are the few weeks ago so they participated in episode 1.
I interviewed one of the people I interviewed was Jeff Wilke who spent it on his own two decades and is now to CEO.
Best way to get the global retail business and Global consumer and he reports to Jeff Bezos
in episode 2 I did it interview the vice president of the smart home at Amazon.
And you know for a episode 4 which will come out the week of August 12th so.
I want to watch than a week from now you know I got a tour of one of them is on a more automated warehouses for an episode about through Amazon as an employer and Automation and so Dave,
but they also just you know turn down and on-the-record interview for.
In episode that’ll be about competition on the Amazon platform and Sherman Antitrust scrutiny so I would say.
They probably participate a little more than I expected but I think they’re I think they’re kind of still in a way to wait and see mode.
[19:37] Did you did the Fulfillment center the toward was it like Eva based or was it one of the ones like the pallet lifting robot or something that we haven’t seen you.
[19:46] It was,
yeah so I don’t know what I didn’t see in the warehouse so it’s possible and had more than I saw but it what I saw it were I don’t know that they call them TV anymore but yes the orange,
I think they call them mobile drive units are carrying carrying the 8-foot tall shelves to their stores and their Pickers.
[20:12] Got to go so you don’t you like us spend a lot of time to think about Amazon what’s what’s something that you done the podcast that kind of was a new discovery for you.
[20:22] That’s a great question I think I think so far.
It reinforced a lot one of the things I thought I knew about the company over the last six years you know I will say one thing that stuck out to me that’s in one of the episodes that is already aired so,
episode 2 is about sort of the smart home and Alexa and.
Yeah I won’t give too much away for people living with him but essentially I’m talking to someone who’s in the author and futurist about you know.
All the types of things that Amazon might do in the future with the data they can collect and you know I ask the VP of the Smart Home.
Daniel Rausch I said so you know do you guys have a team’s inside of Alexa and I know you have thousands of employees working on Alexa that sort of kind of listened to like this the questions coming from the Skeptics of this you know,
as I said that the echo the echo behind me Alexa.
[21:30] I’m going to ignore that I’m sorry guys so they’re always always listening.
[21:38] At least you’re still has work so they’re not too angry with you when your when your Prime shipments stop in your Alexa stops then you know that you fingered the Amazon.
[21:50] I was a little surprised I asked you I asked his VP of a smart home,
you’re do you sort of listen to it a lot of the smart smarter Skeptics are saying and what they worry about in the future and Anna try to like maybe we’ll work back from you know some of those potential.
You know use cases that people are worried about or you know data collection people worried about and his answer was essentially we were young very Amazon we work back from your problems and you know.
And I we start from a place of optimism always phrase like started,
the amazing company it is today but also miss climbing in 2019 like saying like.
Tapping the site Facebook and social networks and you know it just felt,
I guess I was just surprised they’ve built a certain lack of knowledge mean the word seems me self-awareness.
About sort of the downsides of you know the advancement that sure the fast pases,
Innovation sort of Eden of even specifically like inside our hugs and that’s one thing that sort of stuck out to me,
that was a little surprising I’d say.
[23:15] Yeah that
totally make sense I mean to me that’s part of the fun of your podcast is for your point you know most listeners are they show or sort of living and stuff day today and it’s like you’re there some new piece of news about something Amazon’s doing.
Every week if not every day and it’s kind of fun on the show that you you kind of,
take that 50000 put View and kind of put it in a broader context then leaves.
[23:47] Yeah I’m like the chat near the challenges we’re trying to do a couple things like my goal is to have Jason and Scott and the listeners of this podcast and the you know,
sure the sources I have you had developed over six years day today reporting like find enough compelling story wines and and hopefully new information as well that even though they stay the day they are coming away saying,
that was a pleasant storytelling experience or I learn something new or I never I didn’t think of it that way while also being welcoming to
people who don’t live this day today but but have Amazon in their lives you know in a big way and wonder about Amazon or 1/4 about Jeff Bezos or you know
shortest sit on the periphery
of these industries and so I think from the feedback I’ve gotten the reviews I’ve seen I think we’ve done a pretty good job at that so far,
but you know we’ll have you know episode 6 which will be antitrust and competition on the Amazon Marketplace I can that one like we’ll dive into the weeds that in a way that I think even people in the industry.
It’ll really really resonate West and I think will be both surprising and hopefully
somewhat news-making so I’ll leave that to you.
[25:07] Nice. That’s a good teas are a couple of short fun facts on stuff we’ve already covered I can’t let it go without teasing Scott Scott had an opportunity to be an early investor in Cuba and thought it was a stupid idea.
[25:21] Yeah what was NC State Professor he was talking about how he was going to take the algorithm ants use an appliance warehouses and it just didn’t didn’t make sense to me that Aunt part lost me.
You was right I was wrong.
[25:35] Yeah I know I’m just I’m shaking my head in this empty house right now so.
[25:44] You mention so in episode 3 you visited a,
a warehouse that’s now a fulfillment center is now closed you you teased us that you went to a modern performance center and episode for a fun fact for listeners,
Amazon actually gives a remarkably good tour of a bunch of those,
modern fulfillment center so even if you’re not a fancy journalist I Jason,
you you can go to a web URL and Reserve at or I take clients on these tours all the time and it’s if you’re in the industry or you’re just interested it’s super worth going,
so as you’re listening to episode 4 and hearing Jason’s description know that you can you can follow it up with aching person experience and I’ll put the donation the show notes.
[26:33] Have you been to the Staten Island New York Film Center.
[26:36] I haven’t and so an interesting question which I’ll see if our intern can figure out while I’m talking to you only certain of the facilities are available.
For the tours.
And I don’t think that’s an island is so like in your neck of the woods Robbinsville New Jersey and West Deptford are available.
I don’t see Staten Island on the list I’m in Chicago and they they have a.
You have to go to Jefferson Indiana and now there’s a which is a suburb of Chicago.
It’s pretty interesting and I presume you had a slightly different experience at the very least they let you bring a mic and they do like Frisk you for all your digital device.
[27:39] Yes yeah they were there were big they were big no no phone or no camera signs and then
yeah I was going to say another
I’m hesitant to say what I think my memory is surfacing right now and another know something signed but I’m wondering if maybe it was when I visited a different
Amazon facility 5 years ago or 6 years ago and cnx I have a vague memory of a no guns sign but.
Anyway I am a millionaire I don’t remember for sure so I probably should have said it but.
[28:26] That’s not going to want to listen it’ll be safe I’ll put Jason’s phone number in the show notes.
[28:34] Speaking of Jeff speaking of Jeff Bezos I got a secret I got a little package in the mail today from from.
Kara swisher and the box says Bezos primes and the hundred and hundred billion dollar man and I opened it up and it is a Jeff Bezos figurine maybe like.
A foot high and it comes with a robot that he was spotted with that one of his events a few years ago,
so I can maybe that can be your show mascot.
[29:09] That would be awesome is it I’m assuming because the robot is buff Jeff Bezos and not a bookstore Jeff Bezos.
[29:17] Yeah if you if you Google as I just did Jeff Bezos yellow robot the first image that comes up is Jeff Bezos walking with a.
Yellow shirt of is this a robot dog Boston Dynamics robot dog and he is wearing and just in the figurine is wearing what Jeff is wearing in the soda which is.
[29:40] Patagonia obligatory BCBS.
[29:43] Does it have a drawstring into the Jeff left when you.
[29:46] I couldn’t I couldn’t see that past the bulging bicep switch on.
A little envious I honestly.
[30:00] That was really your way of just working in that Carrie Fisher knows your address which is impressive but.
[30:05] She actually she actually I’ve only worked with her for 6 years and she had to text me for my address the other day not that cool.
[30:15] Yeah I kind of assumed that was the case I have to compete cuz I have a current mask mascot staring at me that I was going to bring the code Commerce this year I have one of the pets.com sock puppets.
[30:30] Yes yes and I’m assuming you’re saying that the guess we’re going to have Julie Wainwright too and I’m back in the day at one point rent ups.com.
[30:41] If I were younger listeners pets.com was one of the the fast runners in the first free internet crash
that was a precursor to Chuy and had television campaigns and it has mascot was this sock puppet dog
the that that’s essentially did in fact morph into Triumph the the comedian.
I don’t know if you know the backstory here but there are lawsuits in the whole thing that,
that sort of after pest.com left that the comedian that that treated the Triumph character like bought the rights to the Past. Calm dogs,
and there are some real property fights and stuff so it’s fun and then the founder of pets. Com is the the also the founder of real real who’s going to be at your shop.
[31:35] One correction yes she was not,
not the founder of cats but feels like almost every time.
Yeah journalists are very go see this on almost every time Julie is you know appears that something like.
Pets.com comes up twenty years later and I’m just curious about like,
maybe it’s something it’s a it’s a role she held but I’m curious of what she’ll have to do like what she has to do to like not have that be part of the,
part of the story in an only reason I ask is will a,
I had someone reach out to me recently after we announced her and was like really you guys still mention pens.com and it made me think about that and then being like
who is the CEO and maybe it’s just a bad person and I should,
I should I should know whether a person is alive or what they’re doing today I think it I think it might have been a George something.
[32:46] George Shaheen good job.
[32:48] Okay cool you know maybe it’s just a juul he’s had some level of success and I don’t know that’s that’s enough that I don’t know if that was actually a question but it’s something I I was just thinking about recently and so was interested.
[33:02] If I remember correctly after webvan George became the CEO of what was then Anderson Consulting now Accenture.
[33:10] Wow I was going to say something really mean which is probably not right I was going to say failing up but but maybe I actually was not covering.
[33:19] Thank you I think I could be a correct characteristic.
[33:22] Okay sorry George.
[33:26] That way so I have a very minor version of that I started my career and was like one of the original directors of marketing a blockbuster entertainment and in my world,
like every time I go visit a client the the consultant from my saying company right before I get there pops up a slide talking about how you don’t want to get Blockbuster.
[33:46] Oh well.
So you view a failed really up.
[33:51] I have but I would actually point out I’m feeling,
down because we sold Blockbuster for 9 billion dollars people always talk about the end when a failure the company was you no railroads are not a very good,
investment today but Anderson Cooper’s family did pretty good on the railroad.
[34:15] I am now staring at your LinkedIn which I did not know about this.
[34:21] That I never listen.
[34:23] 1616 month. Of your work career.
[34:26] It’s a slide that I have to face every single day as though.
[34:34] Listen listen as someone who grew up so when you were there I’m not going to do the age thing but okay I’ll do it when you were that when you were there I was,
I was in Middle School and
Blockbuster was probably one of my favorite places on Earth and I have very fond memories especially now that my parents both my parents are deceased very fond memories of going into Blockbuster on Friday nights and you know,
hoping you what am I remembering correctly that like the case might be out but like if you opened it.
You had it like you found out whether a movie or game was in or not with whether it was actually that the case was empty or not or am I am I totally making that.
[35:21] I know you’re probably thinking of an independent video store so I guess what we would have is the box art would always be there with the movie was in stock or not behind and next to that box are would be.
[35:32] Oh yes.
[35:33] 30 or 40 Blockbuster desert called Amaray cases that plastic taste it held the the video.
[35:41] Got it well well thank you for giving me this even this cloudy memory of my Friday nights as a 12 year old.
[35:50] I appreciate you making it a blockbuster night we are so getting back to more tree Topix,
I want we want to transition of the podcast but one question that you you may have inadvertently.
I revealed an answer already but so season 1 Amazon you are the host.
There’s you know it least four more seasons are you going to be the host for these other companies or are we going to meet some new character.
[36:26] Most likely not I think,
this is I think there were likely be people with more expertise.
Then I have on those other companies since I have spelled spent the last six years really diving deep into Amazon in e-commerce show.
I don’t I don’t know what the 100% answer is but that is the 99%.
Correct answer likely answer so no I did I did there is an appointed frankly you know that I had to make you know
by choice I had to make some trade-offs as I’ve spent the last six months and still end on this podcast series and also working on the conference which was I’ve not been
able to report and write as frequently as I was I would like so you know where in the beginning of August and the last story I published was a big deep dive into
internal tension at Walmart and that was a month ago so I’m anxious to get back to Amor,
consistent writing a Cadence starting in the fall.
[37:42] Cool I like how you started filling in the middle so you’re kind of like doing episode 4 Star Wars style and then you’ll have to kind of go do some some will have to come in and have filling before you.
[37:56] Netflix is going to be the prequel.
[37:59] I’ve always wondered is Amazon the first a in the Fang that has two A’s or II a.
[38:06] You know Kramer coins this I’m 99% sure so we can ask him.
[38:14] Know what you tweet we we we all know no one famous actually coins that thing right there like borrow it from someone was less famous.
[38:21] Not the creamer did he had it on his knuckles one night I remember I remember watching the episode.
[38:28] What it is like really fired up here like almost like a knuckle tattoo so is like f a i n g on the.
[38:34] But am I if I’m remembering right just to jump in when Kramer did start using it Apple wasn’t even one of the things so I am assuming it was literally faang and I think so therefore it has to be m.
[38:49] Someone has tried to make for the newer companies A+ happen if you heard that one.
[38:58] The effort several chondromatosis they’re just not as catchy of Spain.
[39:03] No and now and I can’t even I can’t even tell you what the A and A+ is is it I’ll maybe it’s Airbnb anyway.
[39:11] The G is now and they also to make things more complex.
[39:15] That sounds like an Andreessen Horowitz thing cuz it sounds like they’re portfolio does their PRT.
[39:23] What’s an A+ that I’m forgetting which food at after is who thinks he’s an investor he actually is an investor.
Yes he is in a duster sorry Aspen yeah a plus.
[39:37] What in your world A+ is Ashton Kutcher in my world it’s the supplemental high-value content on the Amazon product detail.
[39:46] Man we are we are just nerding.
[39:52] Cool sweet recommends that listeners check out Land of the Giants make sure you get the D in there except to get the search right it’s great podcast we strongly endorse it here at the Jason Scott shoe
so weak since we have you Jason we thought we just kind of
Heather written about the news without we pick your brain about some topics the one I’m most interested in is we’ve had a lot of IPOs and recently so we’ve had
Uber Lyft are out now we got chewy real real they all
Uber Lyft haven’t done so great but I think the Commerce ones have done pretty well specially real rely things done quite well what he thinks next I know you follow the shoe guys close to are they tearing up or is it your way just raise a lot of capital.
Country has few you have any insights into what’s next in the pipeline.
[40:43] Yeah sure so I’ll you know what some of the ones I’ve been curious about.
And so so wish wishes accompany that.
Assertive gone through phases of being like like very much in the business news and then you know skirt,
out of the news in the business world and you know frankly I haven’t checked in on their performance in a while and you know last I saw that,
there are some reporting that there is there gmv or I don’t know what they use for their gross number is I want to say was somewhere maybe approaching or around 10 billion and.
[41:29] And I’m assuming most westerners no wish but should I tell them what it is if they down or.
[41:37] Yeah so wish wish I like to think of it is essentially AliExpress but for.
[41:46] The popular in different markets or sort of taobao,
what the Western Schism on it essentially not it’s,
it’s a mobile shopping app with a fee that specializes in the low price non-branded products that are very very cheap that often,
will take weeks to get to you although they’ve they’ve opened up some of their own warehouses to stop for the best selling stuff,
and I’m just very curious about them in it for a long time mainly for you know a lot of stuff they sell,
does not last very long
yeah I’ve wondered a lot about what you know what the expectation is with different consumers in different countries when they pay a dollar or $2 for something like is it
okay that it,
brakes after 4 tries or no is that going to be a significant turn issue to wish is one you know I don’t I don’t know what their IPO plans are I could see them going public in the next year but that’s one of the companies I’m anxious to dig into when I get back to writing a little more
Casper there’s been a lot of talk about I still looking at you know I still work at that company and.
[43:14] Msmm frankly just skeptical of a long-term independent future you know my big question with all these sort of single product for the most part I know they have some other products but single product,
digital native Brands is are they really expanding the markets,
they’re in or they just growing much faster than previous iterations in their industry and so they’re going to hit a ceiling
much faster and maybe that’s obvious the people but it’s something I think about a lot and.
I just you know I had to report a couple years ago about talks they had with Target about a potential sale for around a billion dollars
should I trust one like I don’t know what the outcome is but I am very curious because like I said I’m I’m skeptical the public company that Casper has a password and public company,
and then some other ones instacart,
I think I wish around the current valuation they seem too big to be acquired,
I’d love to see you in an s-1 filing with those unit economics look like.
And then one that sort of Commerce City but sort of marketplace I don’t know what you got if you guys have heard much or,
what that much recently is house Houzz.
[44:38] You know there was a lot of talk around then maybe a year or two ago and the businesses are smart like at a certain point you just want to get want to get your economics write a certain scale and like.
You don’t need to be held talking to the business press as much and so that’s another one that sort of all my radar to check back into.
I did a good job of talking for a few minutes and not actually answering your question.
Makes me feel like a PR person.
[45:06] Those are good let’s see how about that you guys were they big enough for you think they need some time to consolidate.
[45:18] Yeah I I mean iced I still think those are so there’s there’s good and there’s stockx.
data breach which took them a long time to reveal actually I think I just got an e-mail today but I feel like I saw it reported last week maybe.
My opinion is I think I think those are acquisition place.
I just I have trouble I have trouble seeing those guys as public companies then again like you know maybe they you know the real real just went public and I know it’s not Sneakers but it is.
It is sort of high price high price point items Consignment second hand and sell.
You know maybe maybe that is a future but my bet would be on both companies acquisitions.
[46:25] We’ve I recorded your your bets and we’ll do a recap show later I’ll throw like one slight editorial and let you know
can I think it’s an interesting thing about some of these companies that has changed as a result of digital disruption if you were to launch a
a really popular single item company 15 years ago,
the marketing vehicles that would be available to you and it would be affordable to you would like,
put significant parameters on how quickly you could grow so even there was a demand for 5 million people that wanted to buy your product,
it might hate for five years for all five million of those people to find out about your product.
And today that that same five million people will find out about your product one day after you want,
and so what are the things that I feel like digital has done is.
Artificially compressed the sale the initial sales.
For your product info you know the mistake I think some people have made is you know you look at these rapid growth of all these companies and you go oh man we just project that out another five years,
this is a huge business and what you don’t realize is.
[47:49] You hate you hate you hate your car.
[47:51] Plateauing much fat.
[47:53] Yeah. Yeah you said that and much more articulate way than I was then I hit that I did earlier but yeah that was
play I was attempting to make was already are these companies and weeks I think we’ve seen it with some are these companies going to hit a ceiling much sooner than
they expected maybe investors inspect extract and.
And so yeah I mean that’s why I don’t hear it as much but I you know I grew double overtime you know few years ago I would have laughed after a. Of time when.
A Founder that was like 4 months in or 6 months in would talk to me about like it was confident about.
LTV lifetime value and like modeling out there tax you know because.
Because of that very point you just made like you’re going to stir your hitting your target audience much quicker than in the past.
[48:57] Coop’s one area I wanted to see if you have any thoughts on this you’ve done a lot of good coverage around the food delivery companies you mentioned instacart
so there’s there’s like a zillion of them and
we saw a little bit of consolidation with someone acquired the one that square has always so that was caviar and they got acquired by.
[49:18] Yes yes and there was also controversy around tipping so to give us an update on what you’re seeing there.
[49:26] I mean it’s like the wild west right it’s pretty crazy yeah we had also reported that Postmates had.
In a filed they had a press release very early this year saying they had confidentially filed,
paperwork with sec to go public and we are now in August,
they have still not filed their official S1 paperwork a publicly that is very unusual for a company that will,
that for companies that will eventually actually make it public until we we we have reported that every code that they had talks with some potential acquirers there just has to be Asian I mean no one you know
of the private companies no one’s making money doordash is viewed as sort of dick because they have all this money SoftBank bank backed company they have tons and tons of money that they are burning through,
just to gain market share I mean there you know the rumors about them doing some deals with some of the The Big Dig
sort of quick casual and or fast-casual and food chains were there essentially you know,
they’re take raid or they’re cut is like.
[50:47] Pasta zero or maybe it’s zero in some cases and so this is me it’s just not sustainable what I’ve been told and Uber went public,
and had a good public outing
and was a valued you know they were they were thinking they were going to be value to round 120 billion I haven’t looked recently but I’m going to try to pull it up right now what are they 70 70 billion
that they were going to wipe they would be wife we to do a deal,
for one of the companies and so that you know that the problem in a couple problems you know,
so I sold my back was they were going to eat there were neither acquired doordash or even GrubHub another public company,
and but at 72 billion instead of 120 billion those deals at those companies market caps evaluations,
become really really big percentage percentage of meaningful percentage of Uber’s market cap.
[51:52] And yeah I could I could keep going to ugly one other point just on like the the debate for Hoover on who do who do you acquire you know you choir doordash you kind of a quite you acquire the crazy
show the crazy player in the market that’s forcing anyone to just everyone in the mark this sort of lose their heads and burn cash for market share but but that
that’s her set you back on the economic side like that does not help your profitability of your business right maybe there’s some synergies but like on the face of it no
if you if you acquire instead GrubHub which is profitable business,
you know you’ve you’ve gained some NASA volume GrubHub shuja New York with seamless Fusion some Big Moe died in Chicago GrubHub popular Hometown but then you still have the crazy,
cash burner doordash out there and so.
I’m really interested to see what all happened I think there will be consolidation I’m hoping we haven’t announced any of food delivery CEOs for code Commerce yet but I’m very confident we’ll have one of the heads of want to be Services there,
and what I didn’t talk about what is the Tipping scandal,
which is essentially I drove one of you guys for a wants to summarize it but it but I’m happy to get my dots on it.
[53:16] Yeah I think the the summary is the so they they all charge there’s just got two buckets there’s a there’s a delivery fee and there’s a tip and,
what’s happening is if you if you put a tip-in then none of the delivery fee they’re essentially kind of well couple things to do is,
it’s legal to skim the tip so you can charge the worker you can you can take out
yo sitting on there’s all kinds of rules around us but something like two to 4% essentially covering your credit card fee and whatnot so that’s one aspect to this
I think all that stuff kind of unethical but whatever so it’s legal and then and then the bigger thing was that effectively you know the
as you tipped then the company was keeping more and more of the delivery fee so they were kind of saying it was like an order so the driver got you know kind of an order from the delivery fee in the tip not an ant.
[54:15] Right and I think this was surprising to an indoor dashes case and I don’t think they were the only one surprising to both,
the delivery people when they were in that you know I was tipped,
$8 but I didn’t get all that tip and then I think it was surprising to,
customers and doordash initially
sad like we believe in this model we believe our it’s more steady income for our delivery people with this model and when they don’t when they get you know this is better for them when they don’t get a good tip and,
and then the story kind of exploded again a few months later when I think of New York Times writer,
a reporter asked her did delivery I get her first person then of what it was like and this came up again and then
doordash recently gave in or has said they will change their model the problem with the whole space I mean I’m going to paint with a broad brush and I know there’s some nuances with each service but
generally like there is just I think most consumers just don’t know.
How much they’re paying and where it’s going and you know maybe for a lot of people they don’t care that they’re,
you know the price is basically marked up twenty 30% from what they would pay in the store but the convenience is worth it but.
[55:45] I really think there’s room for an ethical player to Stand Out by just doing business really the right way the problem is I think the economics of the business at least with the current auditor site and how many services there are.
Don’t allow for that.
[56:02] Yep yeah that’s at some point prices will go up in the convenience store and consumer will know that they’re they’re paying extra for the stuff so what we have to just come to get to that normalization.
[56:13] Yeah the the tricky part is sometimes when at normal ization happens then the service isn’t as appealing a consumer’s rights.
At a similar version is played out with instacart where they were Articuno originally they they had a low delivery fee but they were artificially raising the price of all the goods you paid so it was.
[56:32] Right right.
[56:33] And when customers found out about that that’s out really oily and dishonest so you know they started passing through the items at the same price and tried to charge more for the delivery fee
and found the customers weren’t willing to pay that delivery piece of eight like 10 only do good in Market Square,
they kept the delivery for you which meant the unit economics for the business don’t working in a b c is paying for your delivery.
[56:59] What are you doing I’m just curious and it like do you think any of these bit whether it since the card or you know the the meal delivery companies.
Do you think do you think any of them like go away like they did do you think we’re in for a rude awakening where like.
Some of the most sensual like one or two of them like literally collapse even.
[57:22] Why did consolidate in one of them does well for a while but in the long run I’ll predict the day all the way in or we change and the reason I say that is.
That they’re essentially offering a service to grocery stores in the kids of instacart or restaurants in a case of the others,
providing a customer experience at that Grocery Store retail you know restaurant wasn’t interested in providing or didn’t feel they could have adequately provide and,
early on when it’s not a big business it made total sense to do that as,
that service becomes the dominant method of getting those those companies products.
It becomes increasingly stupid for these companies to Outsource this right and I mean not the analogy to me.
[58:16] Oh I am now remind I’ve heard I’ve heard your tape before but I want.
[58:20] In the early days.
Nobody built their own e-commerce I try like we’re retailers and so what will pay this technology company in Silicon Valley to operate an e-commerce site for us.
[58:31] Or in Seattle.
[58:32] Yeah so that was either Amazon or company back in the day g s i n g s I became a very successful very fast runner made the owner of billionaire now owns the 76ers the.
In the long run.
All of the the surviving retailers had to find a way to unwind their deals with Amazon and GSI because it just became too important a part of the customer experience and when I.
[59:00] And those DSi deals man I’ve heard some stories.
[59:03] He was a great salesperson that the contracts were absurd.
[59:08] Team 10 15 year deals yet.
[59:10] Yeah it was amazing but in the case of restaurants there’s a huge shift in consumer Behavior.
20% of all restaurant sales are now consumed off pram,
the the deals they have with these marketplaces are unprofitable for the restaurants and so it’s it literally at the,
inhibit scales under the current economic model outputs all these restaurants out of business and side note all of these delivery companies are secretly opening,
kitchens and commissaries to start delivering the universe similar to Amazon private label Marketplace so there’s more pressure coming in the big successful restaurants that actually have products that consumers want.
They’re going to have to own their own delivery experience right in it and you talk to these got these huge companies are announcing oh we’re going to partner with Uber Eats,
and I I go like that that’s crazy that’s your the front door of your your restaurant.
That you’re now Outsourcing to someone that’s going to disintermediate you from the customer it for a variety of reasons I don’t think it’s a sustainable model what’s the.
[1:00:20] Yeah one one other thing I forgot to mention Little Couple interesting things one is you know
the former CEO ousted CEO of uber Travis kalanick he’s in the space I think
here’s a company one of his one or a division of one of his new company is called Cloud kitchens which is essentially these like dark,
call dark kitchens or Bay City restaurants that only do delivery.
The other thing is you know how Mazon hasn’t come up in this conversation yet but in the end they you know I think they announced shutting down Amazon restaurants there,
attempted delivery I don’t think they’re out of this I think like I would like,
I think the two wires to me in this space at least in the US are,
Uber and Amazon and so I didn’t you know will Amazon do any big Acquisitions right now with the current regulatory climate maybe not but.
Maybe that’s obvious to people that they’re not out of it but I think some people when they saw them Amazon shutting down out of the restaurants. They were exiting but I think.
I I would not be surprised whatsoever if they if they make a point in the space.
[1:01:46] No I I I think that’s very possible with some decent that’s going to be a great place to leave it because we’ve done it again we’ve completely wasted an hour of our listeners time.
[1:01:57] You got you guys did I didn’t want a day like that.
[1:02:00] You know you are a total a willing participant,
the but if listeners disagree and they want to continue the conversation as always you could jump on her Facebook page and leave some comments or hit us up on Twitter,
as always in bed this was the show that that you know finally added value in your life
what you should do is jump on iTunes give us that five star review and at the same time you can subscribe to Land of the Giants in here even more Jason Del Rey.
[1:02:31] Check can I just plug like you should really give it a shot we’ve been top 50 and top 30 for most of the last week on all of apple and I am open to all feedback,
good and bad I’m on Twitter at Delray Delray Jason at recode.net we have an email address for Land of the Giants,
and I just hijacked your ending there you go.
[1:03:01] Jason thanks for joining us and congrats on the success of the podcast we look forward to hearing the rest of it.
[1:03:09] Thanks guys I’ll see you at code Commerce.
[1:03:11] Absolutely in until next time happy commercing.