Ned Hayes [00:00:00] 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, Spark Plug is excited to welcome Melissa Burdick to the podcast. Melissa is an innovative business strategist and an e-commerce thought leader. She has almost two decades of e-commerce experience, which is saying something in a growing industry. And in 2018, she founded Pacvue, an enterprise platform for e-commerce, advertising, sales and intelligence. Her company helps brands and sellers to grow their business across Amazon, Walmart and many other marketplaces. And to that, Melissa had a decade at Amazon where she helped launch the consumer packaged goods retail business, which is probably touched all of us. So really, really happy to have someone who’s been so instrumental at Amazon in the retail e-commerce space. Welcome, Melissa. 

Melissa Burdick [00:00:53] Thanks so much for having me.

Kira Cleveland [00:00:54] Well, we’re excited to have you. And speaking of which, let’s just jump right into your field of expertise. E-commerce, specifically, what has it been like in the world of e-commerce since the pandemic? Can you take us back to that spring of 2020 and what happened in the months following. 

Melissa Burdick [00:01:10] In 2020 in the pandemic? The world shut down and everything went online, and for a lot of businesses, it hurt them, especially if they were fully brick and mortar. For our business at Pacvue, it accelerated incredibly. And the specific business at Pacvue that we do, we sit on top of retail media networks like Amazon, Walmart, Instacart, Kroger that have advertising platforms. And we’ve since then really built out our suite that’s all encompassing around sales operations and data insights. But at the time of 2020, what happened was Amazon had launched an advertising business and that’s really how we got started at Pacvue. I got the API, which is programmatic access to data that Amazon opened up and really democratized their data and their advertising offering. And we started building TAP you in January 1st, 2018. As when we started in 2020, everyone took a page out of the Amazon playbook. Amazon had started building this Amazon, this advertising business, which they just reported earnings yesterday and I think is at 32 billion. And they saw that this is a really practical way to make money for the retailers. And so in 2020, Walmart launched a retail media network target, Instacart. I mean, you name it, like everyone launched this retail media business and we sit on top of all those APIs and work with all these retailers and typically first to market, which is part of our M.O.. So we were extremely busy working with all of these retailers, helping them to see if their API is into it, So launching them and bringing them to market. 

Ned Hayes [00:02:43] Wow. And during the pandemic, things really, really shifted into high gear in terms of technology and retail and retail stores using online tech to get their goods into the hands of consumers. So I assume the fact that you really tracked that surge and your retailers going online during during those few years. 

Melissa Burdick [00:03:03] Absolutely. And part of the interesting thing was that I think a lot of retailers like Amazon who are really pure play direct online, did so well because they were toys. I mean, that was their business model. Others were totally not set up for it. And they felt this big pain initially, but they had to get up to speed really quickly. But before 2020, in the pandemic, especially with brands, big CPG brands, e-commerce was such a small percentage of their business, but the pandemic really brought that to the forefront that, hey, we need to be really understanding this e-commerce thing and we need to invest more in it, We need to build teams around it. And so both the retailers and brands got kind of a rude awakening if they weren’t pure plays and they weren’t really understanding ecommerce to start really understanding it. And they got kind of a crash course that they were forced to do. 

Ned Hayes [00:03:53] Right? I mean, my mom and pop shop down the street had to figure out how to be online, like almost overnight, you know, in a matter of a month, like our business is going to crash or we’ll be online. It’s one choice or the other, right? 

Melissa Burdick [00:04:06] Absolutely. 

Ned Hayes [00:04:07] So during during that time and even post that time, what are some e-commerce trends that are really exciting? You’re right now, I mean, a lot has changed. What are you excited about? 

Melissa Burdick [00:04:17] You know, really the other thing that happened during the pandemic is consumer behavior. What changed overnight? People that weren’t online are now shopping online and kind of coming out of the pandemic with people going back to stores. The big trend is omnichannel. It’s really shopping everywhere. It’s online and offline. It’s in your car, it’s on mobile, it’s waiting at the soccer game and figuring out, oh, my kid needs more soccer shoes and being able to see right there which soccer shoes you want to buy and be able to go to Dick’s Sporting Goods online and buying them and then maybe being able to pick them up on your way home. So I think the big trend is really being able to buy everywhere and something that Amazon, you know, Amazon’s principles stand on three things and it’s stood the test of time. It’s price selection and availability. Those three things are so critical to shopping. And if you think about it in our lives are much busier now. We’re on the go. We’re doing amazing. All these things you want to be able to do, maybe research online and buy offline. You you want to as the consumer and a lot of power and you’re you’re making all these decisions all the time. And it’s kind of like I want to be able to shop on my own terms and when I want to do it, if it’s 10:00 at night, I’m buying online. If it’s on the weekend, I might be able to have time to go to the store. So kind of the trend is it’s it’s shopping everywhere and being able to satisfy that. Absolutely. I think you you spoke very well to that. We’ve spoken with many guests about how physical retail isn’t dead, but it certainly helps to have a consistent online experience with a physical store. What what advice can you offer to brick and mortar retailers to want to expand their business into e-commerce more? Yeah, I mean, well, first of all, most sales are in physical stores. So that’s still that’s still the case. But I think that more and more people, like I said, are doing both the things that that physical retailers can do is enable showrooming more. So if you can, a lot of people want to go see it, feel it, touch it, but maybe they want to buy it online. So the more and then also something I’ve noticed, especially supply chains are still not back to normal even now. And so a lot of times you go to stores and things are out of stock or they don’t have it. There’s a lack availability. So being able to enable consumers to go to a store, see it, feel it, maybe a makeup store, like let’s take an Ulta or a Sephora, they see it, but then if it’s out of stock, being able to in a very easy and simple way by opening up your app, maybe scan it and be able to ship it straight to your home so that you don’t have to wait on that long line of, you know, 20 or 30 people that are waiting to check out. So kind of enabling this more frictionless way of shopping where you can still get the hi of being able to see it in person. But if you don’t want to wait or if you don’t have the size or the color that you want, that you can buy it online. So kind of enabling more of those experiences. That’s the other part is being experiential, as you know, give people a reason to come into stores. So whether it’s makeup events or how to play the how to apply makeup with the latest pick up trends, you know, like think about the trends that are happening and how you can bring this to the store and how you can bring traffic there. As come the reasons why Starbucks are in Target stores. You know, you can get your drink and you can shop now really give people a reason to come into your stores. 

Ned Hayes [00:07:37] Well, and it sounds like Pacvue is really focused on helping retailers accomplish those tasks. So So how do you use retail analytics to make recommendations to brands and and empower retailers who want to sell online? 

Melissa Burdick [00:07:51] Yeah. So just to kind of give a description of how you and I’m going to try out our tab, our new tagline that we’ve come up with on you guys. So maybe you’ll be my guinea pigs because this is, this is literally something that we didn’t work. On. What we do has not been named like this. Space has not really been called something. So what we’re calling ourselves is a commerce acceleration platform and we purposely leave off the E because really, like I said, it’s kind of omni channel. We’re doing a lot of partnerships. We just did a partnership with Nielsen so people can really understand their online and offline share. But we sit on top of all these retailers and one of things that we’re doing is unifying retail media across Amazon, Walmart, Target, Radio, Citrus. So Christie and Citrus are kind of like sitting on top of all other retailers. So but it’s this kind of grand big world and all the retailers that have retail media offerings. And what we’re doing is we’re bringing all that data into platform, into our platforms that instead of having to log into all of 30 plus different retailers uses, you can log into pack and do all of your activation, all of your work in our platform. And then you asked around like how we enabling them, what kind of data we exposing. So one is around all the sales and inventory data, that’s the post data, but then it’s also all the advertising metrics that you’re typically able to see, like your impressions, your click through rates, your conversion rates. And what we’re really helping brands do is have better performance of their advertising spend on the retailers. And we’ve tied it to a lot of the retail metrics. So I’ll give you some examples. I only want to advertise profitable to me items or I only want to advertise items that have 6 to 8 weeks of supply on the retailer sites. They kind of usually have a I will advertise an item in soccer out of stock, but if I have one unit, I will be able to advertise it. That’s not as smart as being able to say, Hey, I only want to advertise items that I have plenty of inventory in because otherwise I would just sell out. So we’re really making smarter optimizations in automating it so that you don’t have to do it manually. And then we’re we’re kind of sucking in all this data to help make those decisioning and we’re activating it. 

Ned Hayes [00:10:13] So can you tell us the tagline again, just so we’re clear. 

Melissa Burdick [00:10:16] Commerce acceleration platform. 

Ned Hayes [00:10:19] Got it. 

Kira Cleveland [00:10:19] Love it. Well, with all that data that you guys are collecting, we understand that advertising’s one big way that your platform helps brands with its ecommerce. So what makes an effective ecommerce AD? 

Melissa Burdick [00:10:30] Yeah, you know, it really depends on your goal. Sometimes your goal might be awareness of a new product launch, sometimes it might just be sales. So it’s really important first to really understand what it is that you’re trying to do. And then the other part is showing the most relevant ad to the right person at the right time. And I’ll give you a couple examples. If someone has never bought your brand in the past, you’re you probably shouldn’t show them an ad that says, Hey, subscribe and say to this product, you’ve never tried it before. You might want to show them an ad that provides a coupon or a discount first, then they can try it. If someone has got your brand, you might want to get them sticky, your you’re your CPG brand, and then you can say, Hey, you bought this brand the past, subscribe instead to it. So you would show them a more specific ad that meets their needs. That would be some some smart ads to show. The other thing you know there’s really great ways that retailers are being able to expose discounts in ads or review ratings and ads, and that helps people understand more information. And the targeting is the other kind of prize. There’s ways that you can say, hey, only put products that have five star ratings in an ad if it has two stars. I shouldn’t show that in an ad because people aren’t going to click on it and convert. So these are these are some ways that you can be really smart with advertising. Or the other thing are just the basics of having the right images and having the right sizes and all that kind of stuff. This is harder than you think it is because going back to when the pandemic happened and e-commerce moving online, you have to have that type of digital assets, video assets that that work online. And for some brands that that’s difficult. 

Ned Hayes [00:12:23] Right? There’s a whole mix of things that have to be there. So I’m curious if if the e-commerce experience has improved for consumers over time and and you see see this kind of relationship between sellers and e-commerce platforms getting better or worse. 

Kira Cleveland [00:12:41] So one is I think the tools are getting better that just the retailers are offering. So being able to understand what your sales are, who’s buying your products, the tools that retailers are providing to manufacturers and brands. You know, it started out with very, very basic and limited information that. They were able to access to now getting more sophisticated in the reporting and data insights that just coming from the basic uses of the tools themselves. And then on top of that, adding and layers of reporting and analytics that show what type of products you should be selling, what is having higher conversion rates, what are having more sales, and being able to understand how to improve what people are buying versus what you’re putting out there. 

Ned Hayes [00:13:31] Right. So just a follow up question on that. The data is absolutely key. You know, understanding customer data, understanding seller data. And so have you seen the larger players like Amazon or Instacart change the data that they’re providing to sellers? 

Melissa Burdick [00:13:47] Yeah, I mean, that’s what’s gotten even better over time. Amazon has launched what they call Amazon marketing Cloud, and that is just a robust amount of information that brands can access. And it tells them more information about who their customer is. What was the last ad that was clicked when they bought their product? It’s hundreds of information and excel basically in that you could be mining. And so we’re we’re leveraging that information to help brands understand more and more about the customers who are shopping and what people are doing before they click to buy their products. That data being able to crunch through and understand what actually drove the purchase, what was the last ad they saw, whether it was on a mobile or whether it was desktop or, you know, where it was and how it happened. That’s increasing increasingly more information they’re getting. Instacart has a lot of great data insights that they call. I can’t remember their latest terminology for it. They’ve changed it, but they provide a lot of insights and trends around behaviors that help brands understand more about who the customer is. On Instacart, what types of products that work well on Instacart and things like that. And so, you know, part of the reason why is because retailers know access to brands budgets. It’s through data, insights and AI and things like that. And so the more data that they can provide, the more potential budgets and support they’ll get from brands. And because there’s so much real time sales data available in e-commerce, that’s a data rich environment. Absolutely. And kind of playing off of that data rich environment and the insights that you guys provide, are there some guiding principles or keystones that brands can use to be successful as e-commerce retailers? There’s there’s a lot I mean, one is the team, you know, e-commerce I guess started with Amazon in 1998 so 20 plus years ago and getting e-commerce talent has been kind of a step through time. These brands are building out e-commerce teams more and more people. There’s there’s like an alumnus of Amazonians that have now infiltrated Wal-Marts and Instacart and even the brands. And so this e-commerce expertise and knowledge of how to be successful online, that’s that’s kind of the first thing is being able to have the right people or partners. So people are using agencies if they don’t have it in-house or they’re hiring the talent in-house, to be able to make the decisions of how to best for other e-commerce businesses we’re designing for, the online shelf is really critical, so it’s understanding the packaging. I remember early days at Amazon. One of the biggest challenges was leaky camps. You know, laundry detergent would just spill all over books and all kinds of stuff, and people would. That was the worst thing. Customers would just complain about, you know, all the things that would happen. And so designing the right products, that ship. Well, you know, bulky products, heavy products are very impossible for online. So, you know, what are the right products that you can sell? How can you be profitable? Things like that are really critical for for these brands to be successful. I love it. Are there some client success stories or just clients that you find particularly interesting for the journey that they experience that you could share with us? I mean, one, they’re not a client I would love them to be, But one one person that are one brand that I’ve really admired is one called Dude Wipes. Do you know this brand? 

Ned Hayes [00:17:31] I don’t well, I’m a good so. 

Melissa Burdick [00:17:34] So he tell me. 

Ned Hayes [00:17:37] Yes. Yes, I do. But why don’t you explain it to us? 

Melissa Burdick [00:17:40] They built the category. So there’s this kind of toilet paper category. And, you know, the typical brands of Charmin and P&G and all the kind of traditional companies that have made those kind of products. But, you know, the type of product that dude wipes. I will let you research for the people listening of what that product is. You know, it it was a category that didn’t exist. And he started it out of his house. And it has become this huge brand that now has deep distribution. He’s also really the founder of it, has a really great personality that he does a lot of social media and he has a potty behavior or a potty potty humor that really works for him, and that’s part of his brand. It’s his branding. So I think that brand grew up really quickly. It created a whole category and it’s dominated it and it’s gotten really popular. So, you know, there’s all these trends that have happened in this space, and now it’s also like this soda waters that are probiotic soda waters like pop or poppy. Those are. That was kind of a trend and those have gotten really popular. So, you know, brands that have been digitally native like dude wipes that started out that way and then they’ve reached distribution into stores. There’s a lot of stories around that, and it’s been cool to see some of these brands kind of take off. 

Ned Hayes [00:19:07] Right. And it’s fascinating how you can online create a product category for even a product that doesn’t really exist yet or or isn’t getting there. So so I’m thinking especially of the rumble. The rumble was is a basically a sleeping bag that you can use just as a blanket. It doesn’t unzip and and really, really warm and cuddly. And there’s been a number of other things that people have cooked up like the water. Liquid death was actually marketed before they had a physical product. And so you can create a product category, see if there’s any interest in it, and then you can sell the product. Once the audience is interested, it kind of flips around the whole put the product out there and see if they’ll come. You’re putting the brand out there, the idea out there and see see if people show up, right? 

Melissa Burdick [00:19:53] Mm hmm. Exactly. And it’s it’s really kind of an interesting way leveraging influencers, leveraging channels like TikTok and Instagram to get a lot more traction for your brand. So it’s starting in the very opposite direction than traditional. And, you know, of course, it’s it’s kind of e-commerce is less of a mode for products and it allows you to just start selling and get some easy feedback. If you get a lot of one star customer reviews, it gives you a lot of information about if your product is not good or it doesn’t smell good, will help you really understand in mind that data to understand how you can make it better. So some people use e-commerce as like a way to get a lot of product feedback very quickly to understand how to even create products. 

Ned Hayes [00:20:41] Got it. So just to follow up on that, the product creation, as we just said, can be kind of an ideation instead of a physical product creation. And I’m curious if there’s any way of tracking or any tools, maybe third pack for you or others that allow somebody to track if they have 12 ideas out there, which one is really getting traction? Which one should they go off and find somebody to build? Is that a thing that exists? 

Melissa Burdick [00:21:06] Yeah, we we actually so one of our sister company is a company called Helium ten, and that is part of our umbrella company. And they have a lot of tools that help sellers understand the category and market size and what products that they should be creating. So yes, there are tools that we have that help sellers and brands understand what they should even be creating and starting with and how big the market is, because that’s something you want to start with, is understanding the TAM. Like, is this something that’s going to be a big market and there’s like a bunch of people are going to want to buy this or we’re not. And then it gives you a bunch of information about what are the products out there, what price should I be at, which is kind of a lot of information to help you even create. What are the right mining, the trends and understanding what people are searching on to even come up with? What are the products they should be building? 

Ned Hayes [00:21:54] Very, very useful. Thank you. Well, so once you have the product out there and you’ve you’ve defined your market and you’re selling, how do you keep people coming back? We have many conversations on this podcast about how brick and mortar retailers can create loyalty and engagement. So I’m curious, what does loyalty look like for e-commerce retailers? 

Melissa Burdick [00:22:16] Well, how can you not talk about that without talking about the fan clubs for music like the Taylor Swift Fan Club and the Madonna fan Club? And I think that’s a really good example of how people who want Taylor Swift concert tickets had to be part of her. Fans love to be able to get them and you were able to reward them. I think that part of it is what are the rewards that people, you know, like making sure that you’re part of loyalty programs are providing frictionless ways. I won’t say that, but Taylor Swift on that was definitely not frictionless. 

Ned Hayes [00:22:46] But yeah, I was going to call you on that one. I mean, not frictionless, let me tell you. 

Melissa Burdick [00:22:50] Yeah, that’s the opposite. You want to have frictionless ways to be able to reward people. And the best loyalty program of all is Amazon Prime, right? I mean, they started with fast free shipping. As a right now is like very revolutionary when they first started the program. And if you look at a prime over the years, one of things that they’ve done is they kept adding perks. And I think that’s the other critical part is like making sure that it’s actually something that people want. And so they added things like Amazon Prime video, which just became the top streaming service pushing past Netflix. And then another innovation that they just launched was Fastpass, which is $5 a month loyalty program that then you get subscriptions. The average consumer pays $100 a month for their subscriptions. So $5 is a lot of innovation around that. You know, I think some other ways that brands come up with these these events are Thirdlove Bra company. You know, they use a tiered system with three tiers. The more you buy, the more perks you get, like annual birthday gifts and early access and exclusive offers. So that exclusivity part is really important to people with buying into these brands. But I think part of it is the frictionless part is kind of important because if you can’t get access to it or you can’t use it, airlines are kind of feels like there’s blackout dates and there’s a lot of friction with their loyalty programs, but giving people things that they like, things that they are going to then share with friends and have that influencer effect is helpful. 

Ned Hayes [00:24:25] That’s that’s great to know. And with the e-commerce loyalty, I’m curious if you see any shifts happening in terms of e-commerce or mobile loyalty, like the only loyalty app that I use all the time besides our own company, Spark Loyalty is also the Starbucks loyalty system, and I use it only on mobile. And so so I’m curious if there’s a difference between mobile and kind of e-commerce without without mobile in terms of loyalty. 

Melissa Burdick [00:24:51] I mean, one thing for sure, to your point, I mean, consumer trend is shifting more and more towards mobile. I think there is more mobile sales than desktop at this point, but I think it’s important that your loyalty program works kind of on both. And the one you know, the one I forgot to mention is subscribe and save. Like that’s the best loyalty program, especially for consumable products. Where you do you enroll to buy auto auto delivery as a pet food or your your shampoo or whatever it is that you’re kind of buying on a somewhat frequent basis, whether it’s one month or six months and you get people discount for opting into that. And that’s a great thing for retailers because shipping is really expensive. And so this is a way that they can, you know, kind of not have to ship to you in two days or overnight. They can have a longer time to ship to you, which is cheaper to them. And then to the consumer, you know, you never run out. So that’s a good kind of synergistic. It’s good for the retailer and it’s good for the consumer. And that’s a win win for that kind of a loyalty program for sure. Absolutely. And you know, just for a little bit of fun, too, are there any e-commerce brands today that you particularly would want to call out as doing the customer loyalty program? Well, that is a really good question. I mean, I think there love the company that I mentioned. They have they’ve been called out as a really good kind of brand that’s doing it well in terms of on retailer’s brands. It’s harder because of the retailers. If you’re buying on Amazon or buying at Walmart, it’s kind of you’re plugged into the retailer’s program like Amazon Prime or Walmart Plus has their programs. So there is a little bit less of its own personality to have. I think Sephora has a pretty good brand loyalty program. Something like 80% of their annual sales is made up of their loyal members and makeup is really expensive. So, you know, they get things like discounts and gift cards so that they can go buy that same makeup. Yeah. 

Ned Hayes [00:26:54] Well, so if we took your expertise and projected it 5 to 10 years into the future, where is the commerce going there? Are we all going to be buying goods through our smart contacts or, you know, what’s the future of retail analytics and e-commerce? In a nutshell, we don’t have to ours. 

Melissa Burdick [00:27:12] What’s that? Is it Minority Report where you’re kind of walking down the street and you kind of see things and you can buy it. Like, I think we’re pretty close to that, which is kind of funny. But something that’s been pretty top of mind for me is if you guys I’ve been selling all this stuff with Chatty Betty and Openai and how Microsoft and Google are really just, you know, head to head in that race. And they’re both launching stuff around this and next month and integrating it into their office and things like that. I think a lot of that is relevant in the e-commerce space of having that kind of automation and functionality. And it’s things like create a detail page that’s SEO optimized and it looks at my category at the top ranked one in two items and it integrates all the good things about those items and. To my detail page content. I think things like that are really going to start happening very, very quickly probably this year, and more tools are going to be created around that. And it’s around ad imagery or title page content and imagery. And I think that the more smart ways that people can automatically create content really quickly and these are this is things that are done by agencies or people today, I think a lot of it’s going to be automated and it gets to be maybe a little bit of a scary place at some point. But I think that it’ll it’ll automate things, make it easier for people. But that’s that’s where I think it’s all kind of going the next even two years is leveraging A.I. to be quicker, faster build product. So you asked about like what are the tools that you need to be able to understand what to create? I mean, think about if you had that information at your fingertips in a second. Now being able to know this is I should create a rosewater face, whatever, like whatever it is that you need to create based on so much data and it tells you. And the other thing is the speed. You know, we think we work fast today. The speed of a business is going to be even faster. So that’s what I think happens. 

Ned Hayes [00:29:21] And so everything’s accelerating. That’s what I’m hearing. 

Kira Cleveland [00:29:24] Yeah, that’s that’s that’s part of why we put that in. Our name is brilliant for keeping your eye on the future. I love it. You know, as a as a fun wrap up question, also, I’d love to ask you a more personal question, and that’s what what would you want your legacy to be? What do you want to be remembered for? 

Melissa Burdick [00:29:44] That is such a that is such a hard one. And I think my answer to that is I want to spend my next ten years doing that. I haven’t I don’t think I figured that out enough. One of the things that I’ve done my whole career is help brands make more money or help people be more efficient. And I’d like to do something that has a bit more of it and be remembered more for a charitable aspect, you know, helping people, I don’t know, but something that gives back or something that is a little bit more community focused, that’s what I think at some point. I think like a lot of people, I haven’t figured it out yet and that’s okay. Absolutely. We love that openness and that authenticity that you have around that. So, you know, here’s to the next ten years and seeing what you discover for yourself. 

Ned Hayes [00:30:29] Well, thank you so much for your time today. This has been really fascinating. I need to go look at some of the companies that you mentioned and learn more about what they’re doing with ecommerce. Thank you. 

Melissa Burdick [00:30:38] Sounds good. 

Ned Hayes [00:30:39] Spark Plug is a wholly owned property of SnowShoe. Copyright 2022-2023 Spark Plug Media.