Ned Hayes [00:00:01] Welcome to Spark Plug, where we talk to smart people working at the intersection of business and technology. Brought to you by SnowShoe, your smarter loyalty leader.

Ashley Coates [00:00:13] Today, Spark Plug welcomes James Morin to the podcast. James is chief strategy officer at Crave Retail, a digital technology provider equipping innovative retailers with best in class fitting room technology. James has more than a decade of sales and operations experience, as well as a personal passion for local, entrepreneurial and business development. He took a mid-career break to surf and hike Mount Kilimanjaro, eventually leading him to found a new startup outdoor brand called Flow Fold. James embraces a personal commitment to giving back and supporting local entrepreneurs through community initiatives. We’re so happy to have you as a guest on Spark Plug, James. 

James Morin [00:00:52] Thanks for having me excited. 

Ashley Coates [00:00:54] First thing’s first, let’s start in the middle. Tell us about your mid-career break, your mini retirement so to speak, after you sold a startup. And what did you do then? 

James Morin [00:01:04] Sure. So it’s funny. I have these pictures that pop up in everyone’s memories on their own phones. Right now, I have these pictures of myself in really long hair. And when I did this first little quote unquote retirement my quarter life crisis, the really important takeaway there for me was I had to be part of a company that had raised 60 million dollars in venture backed company. I knew it was going to sell. The only real reason I joined that company was I wanted to be part of that process and I don’t regret it for a single day. But what I learned through that process was, if all you’re doing is chasing that carrot just to learn that you don’t actually like carrots, it just really makes you think, second, guess some things. I’ve sort of pivoted my own personal career into just making sure that I did things that I was passionate about and that led to you, of course, joining a couple of my friends at Flow Fold and what they were building in that company. But then also when the time was right, coming and joining here in Austin with Crave Retail. Because again, I’m doing it for the right reasons, because I’m passionate about what I’m doing, what we’re trying to build, and I’m excited to talk to you about that today as well. 

Ashley Coates [00:02:01] Yeah, we’re excited to learn more about Crave! Just out of curiosity, was it that time spent surfing and hiking that led you to found Flow Fold? 

James Morin [00:02:11] No. And I want to say for sure, I wasn’t the only owner of Flow Folds. There was a couple of us. But I think what it was for me, I was I did surf, I did rock climbing, mountain bike, and I spent a lot of time outdoors and I was like, I want to put that energy, my love and my passion towards something around that. And we work with creating of this outdoor gear that could then blend those two passions. But as a result, I got firsthand, really detailed knowledge. I went from the farmer’s phase, which was sort of DTC, but also I understood the dynamics around logistics and distribution. But then I went more DTC and more direct to retailers, and I learned about a lot of issues that I saw with some really big, impressive, beautiful retailers that I loved, and I want to try and help solve those problems. And that led me to so you can kind of see the whole arc that I ended up having. 

Ned Hayes [00:02:53] Right. Well, during the pandemic, you actually helped to create half a million face shields. So can you tell us about how Flow Fold was involved there? 

James Morin [00:03:02] Like everybody else in the world? We were incredibly impacted by the pandemic, and when COVID first came out, every retailer that we were selling into stock by, po’s got canceled, closed. We, as a company and a prior company, we had very technical materials and as a result, we had machinery that could cut very technical materials, very precisely. We knew we had no choice. Not only was our moral obligation to try to help, if we could to create some PPE, but it was a way of keeping most of the team fully employed. In fact, Flow Fold ended up hiring more people as a result of making PPE for our local hospitals and ended up shipping them all over the country. I, however, also took the opportunity where that was the right moment for me to move on and really focus on trying to take that opportunity that I had, which is a little bit of a spell, a secondary retirement almost back away from Flow Fold and they were up and running doing the PPE. But I had to change gears and came to Austin and tried to solve a different type of problem in retail. And that’s where I am now. 

Ashley Coates [00:03:56] That’s wonderful. Well, stepping back for a minute, James, you’ve had more than a decade of success in sales and operations. And I’m just curious when you first became interested in this industry, what do you love about this industry? 

James Morin [00:04:09] I just think it’s so dynamic to retail in general. I think everybody can, and we’ll talk about some of the problems that Crave is trying to solve. But everybody can understand what a good experience is with shopping and what a bad experience is for shopping. And we all do it. We all need to do it. It’s a vice for some people that makes them feel good. Sometimes it’s just a necessity. Sometimes it could be a stressor if financially you’re not where you need to be, especially with inflation, right? So I just think it’s such an important part of our culture of what we do as individuals that it’s really fun to be part of it because it’s changing every single day. And that, as an entrepreneur, is something that excites me because I don’t want to be stuck by a redundant system that’s old and not going to adapt. 

Ashley Coates [00:04:48] Yeah. Well, will you tell us about Crave Retail? 

James Morin [00:04:51] Yeah, I’d love to. Crave Retail, our mission is to give shoppers the experiences they deserve. Really, what we’re focusing on is unifying that online and offline shopper experience to create a better experience for the in-store shopper. Our bread and butter right now is where we’ve seen the most massive success is our digital fitting room, which is really important for any of the listeners. There’s a AR and VR and you’re trying things on in front of a camera. That’s not what we do. Crave still believes, and it’s backed by numbers, still, 70 to 80 percent of all fashion apparel sales is going to start and end in brick and mortar retail. The retail apocalypse is a problem with stores closing, but it’s far overstated to the point of being nonsensical. The majority of action apparel sales still happens in stores because shoppers want to touch, try and feel and try on items. We optimize around that experience by putting digital displays inside of fitting rooms and allowing shoppers to interact with that screen, which connects them to associates on the floor. 

Ned Hayes [00:05:46] Right. Well, connecting to associates on the floor is really critical there. So how do you help retail clients to really provide that better service or training? Or is there ways that Crave Retail helps them to be more effective? 

James Morin [00:05:57] Absolutely. There’s an onboarding process as a training with the goal, of course, of the experiences for it to be so intuitive that a shopper can go into a store that they’ve never been into and engage with the experience that they’ve never seen before. So it’s very simple. It mimics pretty much what they’re used to seeing if they were in a shop online. For instance, Victoria’s Secret, one of our accounts when she walks into the room, she hangs up her items and they automatically appear on a screen in front of her. From there, she can see how much she’s got in her cart, how much she is going to be spending. She can do some research on each individual product. What are the other sizes and colors available, material its made out of. She can read reviews and, while, she’s there, she’s trying it on it’s not quite the right size. She can simply press a button and then an associate on the floor has our app on their phone and they bring it to her. You’re taking a very intimate moment, especially in the case of intimates right with Victoria’s Secret. You’re taking that intimate moment and you’re not requiring to put your clothes back on to leave the fitting room to find something. Now we can juxtapose that with what has been around for 50 60 years, which is you go into a fitting room, the door is locked and there’s no one to let you and you have to go find an associate to get you there. That’s best case, worst case. You go into a room, you’re not sure there’s anybody in there or not. You knock on the door. You hope you don’t get on somebody. You got clothes all over the floor. It’s dirty, the lighting is bad and here you are. You have made the effort to not shop online to get into your car, to stop at the gas station, to deal with traffic, to find parking, to get all the way there, just to have a bad experience when you’re trying to buy. That’s where Crave comes in. We’d make that experience significantly better for the shopper and then optimize it for the retailers and the associates. It’s why we’ve seen success so far. 

Ashley Coates [00:07:35] Well speaking of that success, can you share with us some of your examples and stories of how customers are using the platform successfully? I know, you just mentioned Victoria’s Secret. 

James Morin [00:07:45] You ask that they legitimately got goose bumps. One story comes to mind, it’s going to be the thing that gets us to a one million dollar company. It’s just something that I’m really passionate about because our our customer is the shopper. Victoria’s Secret, Under Armor, some of these big retailers that are obviously keeping us employed and allowing us to build a really special team. But the people that we’re focused on in our mission and vision is to create a better experience for the shopper. And I remember hearing feedback from one of our retailers that somebody who was hearing impaired went in to the fitting room and for the first time ever was able to have a conversation with an associate effectively and get that support. And then it was the first time in her life that she was able to shop and have that experience that we’re all used to having. We’re not built for that, but the fact is that we created an opportunity for that shopper to connect with the associate and get help on demand. And that always resonates with me, always gives me chills. But more specifically, when you talk to the retailer and what benefits they’re getting, you still have to have an ROI for these retailers. And we know that. We’re seeing happier shoppers when we’re seeing positive, VOC, voice of customer feedback coming back. That is impactful because it creates more loyal customers, and we know more loyal customers spend more money. We’re seeing an increase in basket size. We’re seeing an increase in conversion, which makes sense when you’re trying on an item you’re intent to buy is as high as it’s going to be in any other point of your shopper journey. We want to optimize around that moment. I’ve often referred to brick and mortar as having a bit of an identity crisis over the last, well, 10, 15 years since e-commerce came out. It’s what I refer to as this death spiral. What happened when e-commerce came out is that more and more shoppers went online. It was more convenient. Therefore, revenue in stores fell when revenue falls in stores as a cascading effect. Now you have less labor hours, you have less people working in the store, then customer service goes down when customer service goes down. Now, all of a sudden, sales goes down even further, and round and round and round we go to a point where we have these huge footprint stores with not enough people working them in a bad customer experience. So we go straight to the top and we say, no, we’re going to figure out a way to use your limited resources that you have, connect you with the shoppers when they need you the most. And we’re going to elevate that customer experience. We’re going to reach to the top of that never ending downward spiral. And we’re going to stop it in its tracks. And that’s where we’ve seen this. And there’s ancillary benefits reduction of death reduction in return. Both those things are very expensive when it comes to shrinkage, so our primary goal is a happier customer. That’s the number one thing we’re shooting for. 

Ned Hayes [00:10:06] Right. I love your goals and your value proposition, but I’m a geek from way back. So if you can explain a little bit more about how the technology works behind the Crave Retail platform, that would be really interesting. 

James Morin [00:10:17] It’s a great question. And another way people ask this is, well, this is not new. It’s been around forever. So what’s changed? And for Crave, the big thing is in 2018, 2017 area, these big smart, beautiful mirrors came out. If you remember correctly, that was all the rage, and there were some problems with that. They were too expensive to install. Maintenance was too expensive to manage them. They weren’t able to be updated as new versions came out. Not to mention, you have this big mirror. Is there a camera behind it? It was an almost a creepy experience for the shopper. What we have done is we’ve created very scalable solution to that. It’s a simple screen, whether it’s Android or iOS, it’s completely enclosed, no camera showing. And then we have to be two ways in which the tech behind this, the architecture works. One is just a simple barcode where the associates or the shoppers scan their items in while they’re trying them on like a price checker. Our preferred route and what I’m really most excited about is RFID, which everything happens automatically as soon as they walk into the room. No manual effort is needed. That just depends on where the retailer is on their RFID lifecycle, which Crave is not a part of what we certainly encourage it. 

Ned Hayes [00:11:22] So what about emerging technologies? Are you looking at upgrading the Crave Retail platform with some of these smarter CV tools or other tool sets that are coming out that are machine learning or AI related? 

James Morin [00:11:34] Yes. Short answer is yes, right? So we’re always gonna be paying attention to what else is out there. You mentioned integrating with endless aisle integrating with other output recommendation engines. We request three to four years of historical purchase history and then we can tell with A.I., with machine learning, we’re building out the ability to say, All right, if you’re trying on this and you’re likely to buy this based on three or four or five years of historical sales patterns, you’re also likely to buy this. So there’s that opportunity to show that to the shopper in that moment and which again creates a better experience, something they’re more used to seeing online. I know you saw Apple recently came out with essentially contactless payment, where you just tap a phone to next to somebody I’m automatically thinking about. Can someone just tap their phone on our iPad and the sitting room and pay from the fitting room? There’s a lot of ways of increasing that convenience factor in that try on moment, and that’s really what we’re looking at doing. And I’m also a bit of a nerd, so I’m very interested to see where things go with Web three and the Metaverse and how great could potentially be involved in that in future. 

Ashley Coates [00:12:32] Yeah. Well, a lot of our listeners, James, are independent retailers, and I’m curious if you can share any perspectives you have on technology in retail in general and how maybe some smaller businesses or independent businesses might be able to integrate retail more into their business where you might see the biggest opportunity for that? 

James Morin [00:12:51] An interesting question, because I’m also a firm believer in knowing where you went. So if you look at Crave and some of the problems that we solve for, it’s creating a better connection between the associate and shoppers in that moment. If you’re a small, local or independent retailer, you may not have that problem, so it’s lean into what you have available to you. What your strong point is that’s going to separate you from e-commerce is the number one thing. As far as what technology to integrate. What we have learned because, of COVID, is that some retailers now have the ability when there’s pressure to stand up certain things quickly, whether that’s buy online pickup in-store, reserve online pickup in store, using their independent and smaller retail shops as distribution centers. Those are some things now that we have at least the confidence that we can do and we can create. How that flows down to the smaller retailer is still a little bit to be determined based on how they want to integrate that. But I think the focus point you probably be on simple applications that you can have clientele and applications that you can have interacting with basically just the palm of your hand because the goal should be no matter what size retailer, shoppers don’t want a disjointed shopping experience. How they shop online is how they want to shop in-store as well. Create those loyalty programs, figuring out a ways that when they come into your store, they don’t have to retell you what they bought in the past, what size they brought in the past. You should know that whatever application you’re going to be putting in your store, that should be the end goal.

Ned Hayes [00:14:18] Right and you’ve mentioned loyalty programs as being absolutely key for retailers a couple of times in this interview. I’m curious if you see new developments in the loyalty space coming and how loyalty will change in the future. 

James Morin [00:14:29] It’s funny. The first thing is customer loyalty is often misconstrued as a program, customer loyalty as a psychological bond between a shopper and the brand. And it’s like, OK, the first way to do that is to have good customer service and you have to create that good customer service and it’s harder in these big box retailers, potentially. So that step one focus on the actual literal term of customer loyalty, which is having great customer service because I saw a recent survey that took 78 percent of people will abandon a sale if they don’t get customer service. We’ve. And the fitting rooms, if they don’t get prompt service, eight out of 10 shoppers will just leave the fitting room without buying something. So step one is just creating an environment that will allow a shopper to be more loyal. Step two is a physical loyalty program everyone’s used to QR codes, now put QR codes everywhere, get email addresses, and you know this is even more important right now in a cookie this world. This does not going anywhere. Third party data is going away. Apple already did it. Google will follow. This is impacting the way brands can target shoppers. So now, effectively, without a third party data, you have basically the first party data and zero party data. First party data is the data that retailers and brands get from their shoppers, buying things browsing their website, that’s first party. And zero party, which is probably the most valuable, is the data that the consumers the shoppers are voluntarily giving you. That’s the data. That’s most important, however, is a dance. So it’s no longer these loyalty programs aren’t just going to be about points to buy something anymore. If you want my data, you better be prepared to give me something else, is it access to sales before anybody else, is it  access to drops before anybody else. I’ve mentioned Web three when I buy a pair of sneakers. Can I also get the NFT version of it that my avatar now is running around with? Really, at what point does loyalty actually become a token that you now buy as part of the company’s organize? I’m fascinated by where loyalty is going to go, but I don’t know the answers. What I am pretty confident about is if retailers and brands want your data, you’re going to have to give them something in return, and you’re going to have to give them more than just point and dollars on future sales. 

Ned Hayes [00:16:30] Right. It goes back to that question about what’s the line for user data? You talked about zero party data, and I think at one point during the Facebook era, let’s call it, the pendulum swung way too far where the system was figuring out who you were and what you were doing before you even knew. There are some famous examples of this. And now the pendulum is swinging back where Apple is cutting off access to user private data. Other systems are reevaluating their use of data. Where do you think their world of privacy will go in the future in terms of ushering data that it will all be zero party? Or will there be a corrective motion here too? 

James Morin [00:17:03] I think by default, human nature will always lean towards convenience. If you can figure out a way to make a shopper’s experience more convenient or elevated, more personalized shoppers will time and time again and consumers, just people time time again will give you their data and their information. You look at signing up for something I’ll often sign in through Google because I just don’t want to create new log in. I’ll sign in through Facebook. It’s convenience and people are willing to pay for it, but you still have to create that experience. It has to be a better experience or a more convenient experience to get the data. But I think the golden era of just being able to get by tracking my phone, that’s going to go away. That will probably become only more private and more secure as more apps come out and as we get further and further away from centralized applications and start to get decentralized applications that don’t have a single CEO. 

Ashley Coates [00:17:51] Well, so let’s talk more about convenience. I know you said earlier you still see brick and mortars surviving. Does the physical retail store have a real future even when we tend to lean towards convenience and the convenience of online? 

James Morin [00:18:05] Yes. And I think an important bifurcation to understand the difference between buying and shopping. So if you just want to buy something that’s quick and easy, whether it’s I recently bought a new strainer because I want to start rendering animal fat as a true example, which is weird. I told you I was a bit of a nerd, so I want to start rendering my own animal fat to be able to cook with it. So I bought a strainer. I’m not going to go to a physical brick and mortar, but I’m going to go on Amazon. I’m going to do Prime, right? That’s more convenient for me. I know what I pay the $139 or whatever it is to do that. But what I want to shop, if I’m going on a first date this weekend or something and I want to make sure something fits, makes me feel bold, empowered, confident, I’m going to go shop. I’m not going to just go buy something. So what retailers need to do and understand is that you are likely going to be a place, potentially if you are going to just be a place where people are buying things, that’s their only goal. Good luck. That’s going to be a challenge. But if you’re create an experience with people shopping, I’m getting more out of being just a direct exchange of currency. And I think there’s absolutely a place for that. And in fact, you’re starting to see shifts in physical brick and mortar on how the stores are designed, how they feel in order to incorporate that. Bring it back to Crave specifically with fitting rooms as an example. I think the days of having 25 fitting rooms that are four by four are probably going to be for the most successful retailers we’re seeing as a result of putting Crave in. You guys don’t use all your fitting rooms, you don’t need one, you need five that are really nice. You need them to be roomy. You need to have a place where there’s good lighting, where someone feels confident in that space, maybe have a little area outside that your friends are coming or your partner’s coming so they can wait there and be comfortable and be on their phone. So you’re seeing a shift in the actual physical layout of these stores as well. They’re not so big. There’s less inventory. They’re smaller, they’re more intimate. And I think that is a shift towards shopping versus buying that I think will elevate the industry even further. 

Ned Hayes [00:19:55] Right. Well, we’ve talked about a few shifts, so I’m curious if you could look into the future, 10, 15 years, what’s the world of retail going to look like with or without Crave retail playing a central part? 

James Morin [00:20:06] I certainly hope it will. I do think so. I think that we can be serious contributors to changing that shopper journey. I’m interested in following a couple of things I mentioned Web3. I’m interested in following that trend for retail, how that’s going to all interact. I think everything that you see right now is around personalization and how we personalize that experience for shoppers in stores over the next 10 to 15 years. Do you want to call it the personalization decade? I think that’s what you’re going to start to see. When a shopper is trying something on or buying something online, things are going to be geared towards them, specifically in what they want, their activities that they’re doing, the places they’re traveling and figuring out. How do you get an experience that is more customized for your shopper will drive that loyalty, will drive that LTB will drive that spend. And not be a naysayer, but I think on the opposite side of the spectrum. I think that we’re going to start to really see the prosperity of digitally native brands come under some scrutiny. You’re seeing, even if you look at Warby Parker, Rent the Runway, Allbirds, these are digitally native companies that are creating brick and mortar stores. You’re seeing Amazon create a brick and mortar store because they understand the value of the data that happens in that shopping moment, as well as the buying moment. And if you really think about right now, every single thing that goes into a fitting room, a new brick and mortar store that’s tried on, it’s a black box. Retailers have no clue. Never mind what you tried on and then purchase. Try it on and not purchase. Do we have sizing issues? Why is the red always tried on and never purchase? Is it too bold? Can we start to make product and merchandizing decisions instantaneously based on what’s happening in the 70 80 percent of your retail sales, as opposed to just using the 20 percent to dictate your entire year? So anyway, I got back up on my grave, of course there. But yeah, what I’m seeing over the next 10 15 years, for sure. The personalization decade. 

Ashley Coates [00:21:45] Well, thank you so much, James, for sharing your perspectives today and the fascinating conversation and really wishing you and Crave all the best going forward. I can’t wait to go into a fitting room soon and see your technology. Yeah, we do have one last question for you, which is what do you want your legacy to be? What do you want to be remembered for? 

James Morin [00:22:05] Oh goodness. It’s not so much about saving brick and mortar. I used to think I want to contribute to changing the tune around brick and mortar and the fact that it’s dead and everything’s online. I don’t believe that to be the case. We may not be the situation where people used to go to the mall and hang out anymore and do the arcade, and maybe those days are behind us. Maybe I’m just being nostalgic of those days, but I think it has a place in our culture. We want to make retail better for our shoppers. And as far as my own personal legacy, I want to create and take part in creating a company where people want to work. You want to come into work and contribute to that cause. And that’s what’s important to me as a leader, and I’m going to try very hard every day to make that happen. 

Ned Hayes [00:22:42] So fantastic to hear that vision. Thanks, James. 

James Morin [00:22:45] You’re welcome, guys. 

Ned Hayes [00:22:47] Spark Plug is a wholly owned property of SnowShoe all content copyright 2021 Spark Plug Media.