In this episode, Stephen Denton, CEO of Ware2Go, sits down with Bob Schwartz, investor, board member, & brand-builder across commerce
In this episode, Stephen Denton, CEO of Ware2Go, sits down with Bob Schwartz, investor, board member, & brand-builder across commerce
Hi everyone. I’m Steve Denton, CEO of Ware2Go. And I want to welcome you to another session of Commerce Conversations.
Today we’re going to be joined by serial entrepreneur and business builder, Bob Schwartz. If you don’t know Bob, he was the founder of nordstrom.com. He was the president of Magento, one of the leading e-commerce platforms. He’s been an investor or on the board of many, many companies across the entire e-commerce or commerce landscape.
And today we’re going to sit down and talk about, if you have an emerging brand, how do you cut through the clutter or cut through the noise and not run the same playbook in order to have a presence and drive outstanding results?
We’re going to talk about why it’s important to build culture, and how to do it. We’re going to discuss the emerging importance of marketplaces in today’s commerce landscape. And finally, we’re going to wrap things up with an important conversation around unique ways to deal with excess inventory or over goods.
So I’m excited that you’re going to join us for this commerce conversation. I think you’re going to really enjoy Bob. If you’re responsible for commerce, if you’re responsible for brand building, you’re leading a brand or you’re in the e-commerce landscape, I think you’re going to find a lot of valuable insights from Bob. So sit tight, and I hope you enjoy this next episode of Commerce Conversations.
I’m not sure if there’s a more qualified guest for a commerce conversation, and to say this guy has seen it all would be an understatement. Outside of all that, he’s just a really good guy, and he’s a good friend. Bob Schwartz, welcome to Commerce Conversations.
Steve, thank you so much. And I have to say that I might change the companies out, but I would probably introduce you the exact same way. Thanks for inviting me.
Oh my goodness, I was so excited that you agreed to join us, and we’ve got a lot to cover today. So I’m going to come out, right out of the gates today, and I’m going to ask you this. So let’s put that experience and that big brain to work for our audience.
Let’s do. Let’s see what I can come up with.
So you’ve invested in and been involved in some of these emerging fashion brands, and you’ve seen some things, and you’ve seen products come to market. So outside of product market fit, which you’re an expert in that, and hiring the right talent and culture, and we’ll get into that. But if you were thinking about starting a company and you advise a lot of these companies right now, what are those three to four critical go-to market programs that they just got to get right, right out of the gate to be successful?
It’s interesting. When you’re building these companies, what I found time and time again, whether it’s fashion or whether it’s enterprise software, there is an old adage that you hear time, and time, and time again. And it is the top three things for success in building a great company is number one, great execution. Number two, great execution. Number three, great execution.
And it’s not wrong. It’s not wrong at all. But if you’re an up and comer and trying to break your way in, early growth, even growth stage and you’re trying to break your way in, great execution is not going to get you there. You will just be part of the noise. Your job is, you have to execute well, but you got to break out. You have to spend just as much energy as you do on great execution, on painfully figuring out, how do we do stuff differently?
How do we go to an event differently? How do we talk to a customer differently? How do we create a different voice out there? It’s the only way to break out of the noise.
And there is a tendency, especially in the last 20 years that we’ve experienced, people start doing the normal same things. The throttle of SEM, SEO, digital, this, this, this. And they start creating a marketing plan, and they look out and they go, hey, we need a million dollars, and we’re going to spread it across all these different competencies.
And to me, it’s a little bit of boiling the ocean, and I like to reverse engineer. I like to ask, what’s success look like in the next 12 to 18 months? How many new customers do we want? What kind of penetration? What would we be okay with, and what would we be excited with?
And if you start with the amount of customers you want over the next 12 to 18 months, and then backwards engineer into it. A lot of times you’re like, what if I had a gun to my head and I only had a hundred thousand dollars to spend on it all, what would I do? You get a pretty good answer pretty quickly. And then the question is, what’s the unique messaging, like we said. How do you message out there differently?
It’s such great advice, not to run the same playbook over, and over, and over again. One of the things I’ve always admired about you, Bob, and admired about the companies that you’ve led is the culture that you create. So I’m just curious, from your standpoint, as you’ve evolved, what stayed consistent for you, as you think about building culture?
And then, what’s changed for you as times have changed, or you’ve changed, or you’ve learned more, experienced more. what’s consistent, and then what’s evolved for you?
I’ll tell you what’s evolved. When I was younger and an up and comer, I’m like, who has time for this culture stuff? Who has time for this brand stuff? We got to get product out, we got to get sales going, we got to go, go, go, go, go.
And what hit me along the way was, culture is not this idea of this well-meaning plaque that’s sitting up on everybody’s wall, that has all those same integrity, honesty, action-oriented … People just don’t remember those kind of things.
So with my companies, I’ve done this, Steve. I drive my CEOs and founders crazy, it’s in them. I’ll give you an example. Mike Mothner of Wpromote Digital Agency. I met them when they had about 30 people, and we started talking. I kind of joined them as vice chairman when we were about 50 people.
We’re now 850 people. And it’s a phenomenal company, and rated by Adage as probably one of the best companies to work, top 100, and I think even a top 10, ad firm to work for in America.
I met Mike. And Mike was out of college, and he had just started this. He literally started in his college dorm room. And I go “Mike, Ad Age already with 35 people says you’ve got a great culture. Why is that important?”
And Mike goes, “You know Bob, people are important and culture’s important, humanity’s important.”
I’m like, “Mike, this is what you’ve learned to say.”
“Well you know Bob, it’s important that we treat our people well and et cetera.” None of that’s wrong.
And I kept poking him. “Mike, you were in college. How did you know to do this?”
“And he goes, Bob, I didn’t know how to do this. I didn’t want to walk into an office and have Monday suck. I wanted Mondays to suck a little less for myself and my team.”
I go, “That’s it. That’s our tagline. Make Monday suck less.
So I said that our talent cone attached to, versus the big paragraphs on the wall, we make Monday suck less. We make it suck less for each other by having a good environment and treating each other well. We make Monday suck less for our clients. When they walk in Monday morning, their job sucks less because Wpromote is on their side.
So culture’s really important, but it’s not the levers you really think. You got to give your team something to hang their hat on, that’s a vision and an aspiration. Make Monday suck less is not our vision, it’s something else. It’s kind of a cultural head for us.
I completely understand that. Because here at Ware2Go, we have a shared purpose, and it is very simple. Simplify the supply chain so merchants can compete and win. It’s pretty simple.
Perfect, perfect.
We simplify the supply chain so that our customers can compete and win. And that’s real speak.
I think that’s awesome. I did not know that. I think that’s awesome.
So there’s a lot of things we could talk about today, but the one thing I want to talk to you about is marketplaces. Because marketplaces, I think we all understand the place that Amazon Marketplace plays in our lives, with 48% of all US e-commerce going through it. I think we all as a community understand the role an eBay plays in our world, or even Walmart or Target Marketplaces. I think that’s a pretty well understood space.
I think the space that’s not well understood is these other marketplaces, where some of the tools in some of the companies enable this endless shelf. And I’m going to say marketplace in a box in the sense of, it’s made available for merchants who don’t want to put the resources into that. And certainly, brands have an opportunity to do that.
So for the folks that don’t understand that space, because I don’t think it’s very well understood, could you talk a little bit about, what does that marketplace landscape look like? Why do merchants, and retailers, and branded manufacturers want to be in that space? And then, why do providers of product want to be in that space?
It’s a really good question. And when you said marketplace in a box, I feel like that might have been one of those a-has where it poked on you enough, and something boiled up. Because that’s actually not a bad way of hanging the conversation.
The word marketplace is a heavily anchored, which is good. So if you’re doing stuff in marketplaces, people automatically know the box you’re fitting in. The problem is what you and I are talking about is adjacent to that box. Where, when you say marketplace, they think about eBay. Selling on a marketplace. Well, why do I need that? And et cetera.
What I’d like to say is let’s just, we’ll use the word marketplace in a box. And really what it is, it’s a new muscle for commerce. And the marketplace muscle is pretty simple. It says, hey, look, in today’s world you want to grow. You want to offer your customers something different, more, deeper, et cetera.
You have inventory risk, you have supply chain risk. How do you mitigate that? If you want to go into a new category or you want to have more depth or breadth in a category, how do you do that?
Well, you can start to line up a couple drop shippers, but we all know as you start to work through drop shippers, it’s just kind of a messy thing. And then you got separate thing for payments and et cetera.
Marketplace muscle is really allowing you to have infinite flexibility with vendors, to allow them to come on just like Amazon does or Walmart, to feature them somehow within your domain. So some of our customers of Marketplace, or which I’m vice chairman of, is some of the customers are using it now to create new lines that they never were going to be in.
One of them is a large brand around baby, but they never were in toys, it was always around apparel. And they’re like, well, we don’t want to take on the risk of toys. We don’t want to take on dealing with the cost of buying the inventory and tying it up open to buy. We want to do this.
And this allows us also, if we sell out of one vendor, or one vendor’s having a problem, to quickly switch to another one. Or like some of the companies like Macy’s just announced, that they were Opening a marketplace, and they’re kind of doing the Amazon model. Just more of everything, we just want more of everything.
But they’re not taking inventory risk. They can see what works, they can move whatever works into actually open to buy dollars and increase their margin in it.
Yeah, I think about a brand that’s down in your neck of the woods, Jacks. Right? Great place for surf apparel, surfboards. But there’s an audience there, and a marketplace gives them an opportunity online to have an endless aisle, and take advantage of that traffic that they’re drawing into their site. Offer new lines without carrying the inventory risk. I see that as well.
It’s emerging trend that is allowing a lot of benefit. And nobody seems to be hung up, Bob, like they were 15, 20 years ago, on who owns the customer? Hey, nobody owns the customer. The customer engages where they want, when they want, with who they want on platforms they want. And you just better be there when they want you to be there, with a personalized experience that’s seamless with easy checkout and all of that.
So last question for you. Good 360 is doing, when I think about sustainability, I think a lot about carbon-neutral shipping, I think about consolidation of packaging materials. I think about aggregation of goods, shorter distances, things like that. But I can only go so far with it. Because there’s always inventory, excess inventory, overstock inventory, things like that. And Good 360 has been doing some amazing work there. And talk to us a little bit about Good 360.
That’s great.
What it does, and why that’s important in this commerce ecosystem. Because I think it closes out the commerce ecosystem. Is that okay way to end things up here?
It’s marvelous, and thanks for making the airtime for it.
Of course.
Because it is really important. First I’ll tell you, or tell the people that don’t know what Good 360 is, I’ll give them a framework to it. So what we believe, what Good 360 believes there is a enough goods in this world. Our job Good 360’s job, is to get those goods from those with plenty to those in need.
We take in excess, surplus, returned merchandise from some of the largest and smallest retailers and brands around the country. And we then make them freely available to any not-for-profit to come into our marketplace. And to buy pallets, cartons, case packs, or to buy truckloads of goods. And any not-for-profit that’s a legitimate not-for-profit can come sign up at Good 360 for free. And all they’re doing is they’re paying for the movement of the goods.
When I started, we moved $200 million a year of goods. And I’m like, wow, that’s a big number. But it wasn’t enough. 200 million of goods is not enough of excess surplus and stuff that, in essence, a lot of it’s going into dumps and being destroyed.
And so we kind of went after this mission of growing it and growing it, and we started to wire ourselves into return centers of some of the biggest companies out there. And this year we will most likely do over $3 billion of goods that we moved from corporations to those that are in need via our third party, not-for-profit partners out there.
But I’m really proud that we grew from 200 million to over 3 billion. We’re now self-sustaining, which is something every not-for-profit dreams to be. And so it’s been a wonderful, wonderful journey, and couldn’t be more proud of the growth.
You guys are doing tremendous work, and I thought it was a great way. Because this is a commerce conversation, that’s a piece of commerce that nobody ever talks about. The story always stops, it returns. People talk about factory floor to front door, right? That’s kind of your commerce conversation.
But there’s a little more past that front door, there’s a return ecosystem. And then beyond that there’s, what do we do with this stuff now? And I love the idea of getting goods from those who have plenty to those who are in need.
It’s a really good thing. And I think 3 billion is still just scratching the surface.
I have no doubt it’s going to continue to grow. We certainly, there’s a lot of good we can do, and thanks for sharing that story. That’s how I wanted to wrap up our Commerce Conversation today. Which was a part of the ecosystem that doesn’t get talked about a lot, and there isn’t a lot of visibility, and I thought it was fantastic.
So look, Bob, we’ve covered a lot of ground. Thank you so much for being a guest here on Commerce Conversations. It was everything I thought it would be. And I appreciate your time, and thanks for all your support.
Wow, thanks so much, Bob. That was an amazing commerce conversation. Really appreciate you sharing with all of us your knowledge and your wisdom, and I hope the folks in the audience got a ton out of that. I encourage all of you to follow us at Ware2Go, where we post this content and we share tons of commerce content.
You can certainly subscribe, and I would recommend you subscribe to our YouTube channel where we post not only this Commerce Conversation, but previous and future Commerce Conversations. Or feel free to follow me on LinkedIn. I’m happy to engage with you, would love your feedback on how these are going, and how we can make it better. Or maybe some incremental topics that you’d like to add to the commerce conversation.
So once again, thank you Bob Schwartz. You were an amazing guest, you shared a ton with us. And I look forward to seeing all of you down the road for future commerce conversations. Have a great day.