Unknown Speaker  0:00  
Oh

Joshua Warren  0:06  
It really comes down to having the right systems in place. And there are a lot of E commerce platforms out there that make this choice for you. So those SaaS based solutions, you don't really have a lot of control over this. So this is oftentimes a point where I'm having to talk to a merchant say, hey, it's great that you launched on a SAS, you grew really fast, you proved out your business model. But if you really want to kind of scale to that next level of your business, you're gonna have to move somewhere where you have a little bit more control

Darin Newbold  0:41  
All right, well, howdy, howdy, and welcome to Commerce Today. It's another one of our great episodes. My name is Darren and as always, Josh is here to, to bring us some fantastic insights that merchants can use today. So with that, we're gonna be talking about scaling, direct consumer brands, and the systems, the challenges all of the fun that can happen. And it sounds like it's kind of fast paced, and pretty cool here. So rocket rocket out there, Joey, I think

Joshua Warren  1:10  
it's cool. But I pretty much think all of you ecommerce is cool. So Well, first of all, something I forgot to mention to you. But I want to mention the audiences. Today for the first time, I am really going to pay attention to our chat. So if you are watching this live, want to send in a question in theory, I will be able to see it. We're going to check back at the end of the episode, see if there's any questions or comments for us to address. Awesome. Jumping right back in? Yeah, we're going to talk about scaling in D to C. E commerce. And specifically, you know, I've seen some direct consumer brands that hit these inflection points where they suddenly grow almost overnight. And there's some challenges there. Oh,

Darin Newbold  1:50  
yeah. Yeah, that can really hit some big things that how do you handle that overnight scaling with, with your systems, with your customer story and the customer journey, and what that looks like and how it affects that it can be it can be pretty, pretty challenging. So with that, let's go into kind of some specifics around some of those challenges. When you're scaling that D to C. E commerce. I mean, what happens when you have that, like you just said, the proverbial, we'll call it the flash sale. Now what happens?

Joshua Warren  2:22  
Yeah, and there's there's actually, so we're not going to shame any brands today. But there are some very specific ones, I have in mind some firsthand experiences, both from the consumer side and the consulting side. And yeah, one of the brands I'm thinking of trying to think of how much I can say without giving them away, but basically, they sell really popular baby clothing. And having two young kids at home. Me, my wife, mainly, my wife spent a lot of time shopping for baby clothing. Sometimes more time, needed, we're not gonna go there. And there's this brand. It's funny, it's the brand that I've heard about the most, both positively and negatively from my wife. And so I dug into it. And it's because they do these flash sales. And then I think even bigger than that they do these drops, where they'll have a limited edition print, they're only going to make it once they're only going to sell it once. And they'll tell you, you know, hey, Monday at 9am, we're going to make it live on the website, get in there order it, because when it sells out, it's gone. And the challenge with that is, more often than not, I'm hearing about how she wasn't able to complete the purchase, because the site crashed while she was trying to buy, which is not the best customer experience. But then it gets worse because at first they were just sending out apology emails saying, hey, it's so popular. We're so sorry, we're, we're working on our website. But then my wife and some of the other moms she talked to about this, notice that it's not only at the sites crashing, it's that bots are getting in there and are buying the products first. And you have the scalpers that basically buy these limited edition products, and then list them on Amazon at two, four or five times the price. And so now this brand that is otherwise a great popular direct consumer brand is getting this reputation of hey, you're gonna have a bad time on our website. And if you want to buy our products go pay basically the scammers out there that are charging quite a bit more. So that's that's not good.

Darin Newbold  4:18  
Yeah, yeah, that is that is not good. And talk about a a buying population that you really don't want to irritate, because they will, they will rally and they could show up on your doorstep. But that's probably another episode anyway. Well, what's another one of the challenges that that indeed to see that scaling in this ecommerce world? What else might they run into?

Joshua Warren  4:43  
I mean, that's the biggest things that I usually see is one form or another of challenges of not being able to keep up with your growth and so site traffic sites crashing sometimes it's even on the fulfillment side, have a great we sold 10,000 of these overnight but how How do we get them out the door and out to the consumers. But I really feel like the, the thing that I see hurt brands the most is that basic keep your site up, allow people to be able to purchase. When that doesn't work, when that fails, like in this example, that I gave earlier, they're probably not even necessarily losing revenue, but they're losing out on their brand image, they're losing out on that customer trust. In the short term, they say, Hey, we sold out so we hit our numbers, but I think in the long term, they're kind of risking their long term profitability,

Darin Newbold  5:31  
they are and looking at that from the business side, those are, those are things that are hard to see. Because they're gonna be watching that bottom line, they're gonna see the numbers and say, Wow, we're we're knocking it out of the park. And this is where if they don't have some strong values around customer service and and their brand, that could definitely bite them later on. Well, what's, what's a way that we can, we can help the merchants that maybe have run into this, maybe they've experienced this, maybe you're experiencing it right now? What are some things that they can do?

Joshua Warren  6:05  
Yeah, so this is, this is the part I love, because this is where we can get real technical. And it really comes down to having the right systems in place. And there are a lot of E commerce platforms out there that make this choice for you. So those SaaS based solutions, you don't really have a lot of control over this. So this is oftentimes a point where I'm having to talk to a merchant and say, hey, it's great that you launched on a SAS, you grew really fast, proved out your business model. But if you really want to kind of scale to that next level of your business, you're gonna have to move somewhere where you have a little bit more control. And that that can be a platform as a service type setup, that can even be an on premise system that you deploy into the cloud. I know we had an episode way back in the early days, explaining all those items. But I think once you have control over your technology, and once you have control over that, that hosting stack and environment, you can do so much more. So we had a client that during the pandemic, actually due to some changes they made in their business, they literally overnight saw a massive increase in orders and in sales. And we discovered that as soon as their site hit about 5000, simultaneous kind of carts being built out, just crash, just it couldn't handle, wow, that's not good at all. No, they were excited, because hey, that was the most people that ever tried to buy from them. But once they realized, Hey, this is a sustained thing. We got to figure this out. So because they weren't on a SASS platform, we were able to do some really cool stuff, kind of behind the scenes, we actually set up a split database environment. So there's multiple different databases that are used for different things. That way, basically, traffic when someone's just viewing the site. They're having effectively no performance impact on the people that are trying to actually complete checkout, and vice versa.

Darin Newbold  7:53  
Interesting. How does it? How does it know the difference? Magic? Okay, that's a whole nother episode. Much longer. I've just for the for the non technical side of this showcase here I wanted to. That's an interesting one of how do you how do you know that

Joshua Warren  8:09  
basically, a little bit, and even it goes back to our last episode where there's a little bit more I could cover around load balancers. And those are just things that sit in front and kind of intercept the web traffic and decide where it's gonna go. There's some things you can do there. But even within the code, there's basically ways you can say, Okay, this is I mean, the simplest thing is, are you reading to the database? Are you writing to the database, and you can kind of decide, okay, if we're writing, we're gonna go over here, if we're only reading, we're gonna go over there. And that kind of filters those things out.

Darin Newbold  8:38  
Interesting. Well, that's, that's key. That means, again, going back many episodes in really looking at at one point, we talked about budgets and talked about how do you plan this all out? This is that planning, you're now starting to, to see this come full circle in that, if you don't plan it, right, you're gonna hit problems. And there's always gonna be problems. But there are solutions. But again, it's going back to that pre planning and thinking about how you want to handle it.

Joshua Warren  9:08  
Oh, and I forgot the best part of that story. So after we split the database, because that's the part I get excited about, the part of the client got excited about is they went from crashing at 5000 simultaneous carts to easily handling over 12,000. And we actually doubled more than doubled it. We don't know what the upper limit is yet, just because they haven't reached it. So and this was with a fairly sizable investment in servers, but not as much as you would think. And definitely not as much consulting or development times you would think.

Darin Newbold  9:39  
Awesome. Awesome. Yeah. I think there's a case study that may talk some about that somewhere. All right. Well, so let's talk about the first problem. You talked about the baby clothing in that kind of situation. How would I know I have a problem. So that's going to be all my customer service pieces. So the second challenge how am I going to know that's a problem well, I'm gonna lose money right now. But am I going to know where the problem is based on those two, just as two functions. So my customer service manager here comes and starts yelling at me saying, We got everybody's irritated, and they're going crazy. And we're saying why? Well, they can't get it. Well, hey, we sold it. We sold our stuff. Hey, that is what we wanted to do. How would we know? You know, the bots? How would we know some of those things.

Joshua Warren  10:28  
And a lot of that is where your side of the house comes in more than my side. I'm on the non technical side, in case you're wondering. And you're the business, which, as I am often reminded, is as important if not more so than the technology, but it's really having a good manager that and it's funny, I was having lunch with an E commerce manager to a fairly big ecommerce operation last week. And we were talking and he said, Yeah, yeah, if you if I had to summarize all my interactions with customers, not all but majority of interactions with customers, it's literally, I don't like your website. And then it's he has to peel back. Well, wait, what does that mean? What does that mean? Like, do you not like was the product you wanted out of stock? Was the site's not working? Like, there's a big difference there. And depending on what that difference is, that determines even who you need to talk to you next, so stuffs out of stock, that really doesn't have anything to do with the website. That's your inventory, your purchasing your replenishment team, but the websites crashing while Yeah, you need to talk to your technical team and your E commerce department.

Darin Newbold  11:33  
Well, but even then, you're talking to the technical side, but they've got to dig in enough to realize that, okay, there's not anything maybe truly broken with the code. But it's the capacity and how people are hitting it, and then realize that, okay, it's not enough that the code is bad. But it's not created in a way that's, that's efficient. And by splitting this database, and having multiple databases in the load balancing, all of that then created this opportunity to be able to have virtually sky's the limit, obviously, I'm sure there's a limit, but to really make that change. And I'm thinking more of the customer service side, because I, to me, I see that as a much harder one. Because unless somebody in customer service really digs in and realizes that, hey, real people are irritated. But none of you know these bots are these where, where is the the the product going? And how do we find out?

Joshua Warren  12:29  
Yeah, and that's where I hadn't planned on mentioning specific tools. But I will say that, and these are pretty well known in the E commerce space is nothing new. But New Relic and Nobu are two different tools that we've used that just allow you to see, especially if you have Okay, customer services, reporting these complaints from customers around these times, then you can go into those tools. And you can say, Okay, on the technical side, what sort of weird things or errors or delays did we notice? And I know for instance, I've used New Relic before to kind of track down and say, Okay, wait, this, this is a bot, this is a bot, this is a bot, okay? We have kind of a bot problem on our site right now. And that's

Darin Newbold  13:07  
crazy that they can the boss can get through, but I know everybody so smart, they can figure out a ways to, to get through all of that. Well, in summary, kind of wrapping the putting the bow on this. What are what are the takeaways that three to five things that as a merchant, and a manager of that merchant owner? What do I need to know Josh? Helped me Obi Wan Kenobi?

Joshua Warren  13:31  
Well, I think actually, you've already given some great advice and some great answers. And that is, in that connection between, you know, your customer service department and your other departments have, you know, if everyone's off in a silo, if your customer service department just sitting over there going, Oh, we're having to deal with more people that are ticked off about the website, I hate the website, and never tells anybody about what's going on, you're never going to get to the bottom of it. So you have to have kind of healthy communication between your teams, and that whole business side of things. On the technical side. It's tough, especially if you are in a if your experience comes from the business side of things, and you're approaching things from the business side of things, and you go out and you try to buy a new e commerce platform, they are all going to tell you we can scale as far as you need to go, right, your site's not going to crash. It's gonna be great. It's gonna be wonderful. You never have any problems. Like everybody says that. And that's where I go back again, many episodes that I've said this have kind of the, the freedom and the ability to own and control your data and your destiny that you can't get with SASS. Like I would say, if you think you're gonna scale like this, realize that if you start with a SASS platform, you're giving up you're getting a lot of convenience, but you're giving up that control. And at some point you may need to migrate off and really just be aware of where are you in that process and in that kind of lifecycle of a DDC brand of okay, are we still kind of the starting out for comfortable on Sass, are we hitting these limits and need to look at something where we have more control?

Darin Newbold  15:05  
And the last piece I would add to this, because you brought up a point, Josh, a great one about, you know, the E commerce manager, here's why hate your website. And we even had a situation just earlier today, where you we were looking at a website, and I said, that is exactly why I wouldn't buy there. And I would go to a, we'll call it an Amazon or whatever, just because of convenience, because it was hard. But why. And this is the advice that I would give to those from the business side is as much as possible maybe at times, put your customer service people and the technical people in the same room, and then be willing to facilitate a five why's question of why, why? Why, why and D. Dig deep? Because that's where you'll peel back that onion. That's very true. That may be where the magic is at. All right. Well, you heard it here first. Here's all the magic. Again, as always, really happy to have you on board. Do we have any questions as we cruise through here? Josh, before we call it today?

Joshua Warren  16:06  
We did not. But I do want to encourage you if you have a question, as you maybe listen to this later, send it into us reach out to us, whichever social media channel you are finding us on, you can reach out there, because we were actually putting together over on the Creatuity side of things a about a 30 page in depth guide around some of these common ecommerce challenges. So definitely invite you to continue to follow us on social where you can find that but also send in your questions. The things that you are running into as your business is scaling and not just for DTC. We're actually going to look at omni channel multi store retailers. We're going to look at some larger b2b brands. And then we're gonna look at the DTC challenges.

Darin Newbold  16:46  
Yeah, the b2b with big catalogs that, that kind of very, absolutely. All right. Well, we look forward to hearing from you for next time and until then, take care. Have a great day.

Transcribed by https://otter.ai