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Simon Beard and Hannah Udina Return: What’s Shaping Ecommerce in 2024? | #442

In this episode of Add To Cart, Nathan Bush revisits two of the most popular guests from last year: Simon Beard, co-founder and former CEO of Culture Kings, and Hannah Udina from Shopify. They dive into the latest retail and e-commerce trends for 2024, exploring everything from the importance of mastering ad accounts to the power of omni-channel experiences. Simon and Hannah share practical insights on how to stay ahead in a rapidly evolving market, discussing new tools like Shopify’s YouTube integration, the significance of content creation, and the art of crafting the perfect ad hook.

Download Shopify’s 2024 Australian Retail Report for free.

What you’ll learn in this episode:

How Simon Beard’s daily involvement in ad accounts directly correlates with higher profitability and why delegating ads might be costing you money.
The exact steps to turn your physical retail stores into content hubs that drive online sales, as demonstrated by Culture Kings.
Why the first three seconds of your ad are critical, and Simon’s insider tips on increasing your ad’s hook rate to capture and retain audience attention.

About our guests

Hannah Udina is a seasoned eCommerce and IT professional with a decade of experience, specialising in Payments and Platforms. At Shopify, Hannah partners with agencies to expand their footprint within the Shopify ecosystem while passionately advocating for women in technology.

Simon Beard is the co-founder and former CEO of Culture Kings, a global streetwear brand that grew from a single market stall to a $600 million empire. Known for his innovative approach, Simon is also a seasoned investor and serves on the board of a.k.a Brands.

About your host

Nathan Bush is the host of the Add To Cart podcast and an ecommerce transformation consultant. He has led eCommerce for businesses with revenue $100m+ and has been recognised as one of Australia’s Top 50 People in eCommerce four years in a row. You can contact Nathan on LinkedIn or via email.

Get in touch

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Email hello@addtocart.com.au We look forward to hearing from you!

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Broadcast on:: 03 Sep 2024
Audio Format:: other

The ones that are too high level and too far out get a report from an agency once a month and flick through it and don't run, is like, and then they're just shredding fucking money. The best innovation comes out of burning platforms. Throw out all your SLR cameras, destroy them all. Welcome to How To Cart, Australia's leading e-commerce podcast that express delivers all you need to know in the fast-moving world of online retail. Here's your host, Bushy. Hello, everyone. My name is Bushy and I am joining you on the land of the terrible people here in Brisbane. Welcome to a very special bonus episode of Add to Cart, where we're going to break a few cardinal rules today, and it's for good reason. Normally, we don't re-interview guests on Add to Cart. It keeps us on our toes and ensures we're connecting with a diverse range of e-commerce leaders, but this time, Shopify made me break the rule and I'm glad they did. Today's episode revisits two of our most popular guests from last year. Please join me in welcoming back Simon Beard, former CEO and co-founder of Culture Kings and Hannah Houdina from Shopify. Together, they bring an amazing combination of insights, Simon's experience leading one of the world's top streetwear retailers, and Hannah's inside knowledge of the latest trends and developments from Shopify. In this episode, we dive deep into the big shifts in retail and e-commerce, which were highlighted in Shopify's 2024 retail report. You might remember that we explored this last year for the 2023 retail report. We do the same this year and we go off-script just a little bit. We explore why successful e-commerce founders still need to be hands-on with their ad accounts. We talk about how social commerce and platforms like YouTube are changing the game in e-commerce and probably my most enjoyable part of this conversation, why you never want your hook to be cooked. It's a concept that tickled me a little and I don't know why, it just did and I hope you'll enjoy it too. I think you'll get a lot out of that. This conversation comes almost exactly a year after our last chat and we're excited to discuss what's changed, including key takeaways from Shopify's 2024 Australian retail report. If you haven't grabbed your copy yet, feel free to pause and head on over to Shopify.com/au/enterprise/retailreport 2024 or follow the links in our show notes or our blog. It's a brilliant report that is full of insights that could well shape the future of your e-commerce strategy. Best of all, it's free. That's enough for me. Let's get right into the conversation. We kick straight into it. A big thank you to Shopify for making this episode possible. We really appreciate their support. Here's Simon Beard and Hannah Yudina. Simon and Hannah, welcome back to Add Decart. Here we go. This is the rule on Add Decart that we actually don't re-interview people. We interview people once and then that's it. You guys have broken the rules. Welcome back. Thanks for joining. This is the day to be rule breakers. I love it. Lots of change in our world. I'm not going to waste any airtime. We're going to get straight into it. If you haven't listened to last year's episode with Simon and Hannah, probably pause, go back and hear that because we're going to leap straight from that into this year. Exactly one year on, guys, we know that the environment is tough. It's been a bit of a rollercoaster year, but let's start on a good note. What surprised you or stood out so far in 2024? Simon, I'm going to start with you. For me, I'm definitely seeing the opportunities of how e-commerce is shifting and the ease of doing the ads. We know the meta-tax is there in e-commerce. You just have to understand Facebook has built this brilliant model where they basically are the landlord of the internet and tax the whole lot. You have to understand how you have to work with that tax and how good you can create content works out how much you're paying the tax. It's just such an important metric now is that I know for myself, I thought most e-commerce founders were in the ad account every day, were understanding it, were building those day stand-ups around it, looking always new, what was the number one creative in the business at all time. Then it blew my mind as I met others and they never even logged in before. I think where I, and especially as I've got to meet, as part of my exit journey, tons of different e-commerce founders, tons of different ones, there is a crazy, scary correlation between founders that are in the ad account and understand the fundamentals of the ones that are profitable and the ones that are at too high level and too far out get a report from an agency once a month and flick through it and don't know is like, and then they're just shredding fucking money. That has been a sort of irony for me and I think we've seen a lot of consolidation in that there's just, there's not enough margin in there for you to have all this heavy in house team be paying an agency as well, paying them at attacks, not spending a lot on creative and content that though you could sort of survive doing that in the, you know, especially on the COVID once in a lifetime perfect storm tailwind that is all getting sort of consolidated now. But the ones that are doing that, and running that value chain super tight, it is mind blowing the results and how big they can get in this market. Like I was just speaking the other day with a 25 year old, I want to mention his one because he did teach me a lot, but a hundred mill four staff and it's just like, oh my God, like do you know how fucking long it took me to get to a hundred mill? And I think I had about 500 staff, you know, and it was like this, but it is the sort of what's required into that two to three hundred creators working with a week posting two to three times per week, self serving of the ad scale, not, I'm doing it once a day, they're doing it every hour. And it's like, oh, okay, there's levels to it. And it is something that I've learned. I think, you know, in walking away from college kings, I was never always, I was never worried about, you know, the general pants or the David Jones or whatever. I was always worried about the 18 year old Simon beard because I'm like, man, that's the one I was, and as I've met a few of them, I'm like, Oh, Jesus, this is the new way and it's great to learn and sharpen the sore and that one was a big, huge tail wind off tiktok shop, which, you know, in America, it's not out yet in Australia, but in America, there's some, some pretty insane results with the ones that can figure that out. That's what I'm sort of seeing really change in the market. It's not all doom and gloom, trust me, fuck me, you've like literally opening monologue. And I've got about 20 questions, new questions beyond the ones I've already given you to ask you. But I'm going to park that there. We're going to come back to some of that because there's some good stuff in there, Hannah, what's exciting you. Yeah. Look, I just building off of what Simon just said, I think my personal philosophy is that the best innovation comes out of burning platforms. And I really do think there have been a lot of different types of burning platforms that we can go into over the last year, in particular, that have popped up. So reinforcing what Simon said, it has never been more important to know your numbers and know exactly what you're doing from a business level. But I think broader than that, there's also a lot of opportunity and there's a lot of exciting things that you can accomplish by being more lean. I know, Simon, you're probably going to talk about this, but content, content, content. There has never been more of an opportunity to reach more people in this day and age and to sell on more platforms. And I think as we, yes, we can talk about the doom and gloom. Yes, we can talk about all of the tough things, but let's look at them as burning platforms and how we can utilize that pressure to change for better. And so we were talking about before YouTube as a great platform in long and short form content, how you sell more through that, like Shopify has just launched an integration to YouTube to be able to do that more easily now than ever. And actually thinking more broadly around social commerce and being able to sell on multiple platforms, that is what Shopify is going to continue to enable. I think that is hugely exciting for brands that are well established, but also those 18-year-old simons who want to start a business and grow really quickly. So there's a lot to be excited about, honestly. I love that. Are you going to jump on the YouTube integration straightaway, Simon? Oh, when I saw that video from Harley, I was like, this is huge because I got so excited because obviously seeing the results on TikTok shop, but TikTok shop, anyone that's it is so hard and so complicated, so clunky and, you know, it just turns off for no reason. It's very in its infancy and how to get it, but straightaway, the YouTube looks very simple to integrate. But the other thing that I really like is that long-form content is so much better for the actual sale to be built because TikTok's so, you know, it's the firehose of content. You've just got no attention span, and already what you're seeing on TikTok shop, things that work are very in the gray area of marketing, right? Supplements promising, you know, stupid stuff. And that's where sort of a way starts in that. But YouTube, I really love this because, you know, I've been, you know, a big part of AKA brands and seeing Wes with Princess Polly build that flywheel, they did the YouTube halls. You know, that was a huge part of building a 300 million US business was YouTube halls, girls doing them, and these are like 15 minutes, you know, and it's like, girls will watch them. But that was an engaged shop. And that's where I was like, with the YouTube integrate, with this click shop, shop pay button, two clicks while you're doing it, my eyes lit up. I was like, I believe this is as much as TikTok shop is sort of revolution. But I do think it's in a bit of a weird place in America, maybe because it's going to get banned. Like in America, you're hearing people hit 50% of their feet as TikTok shop, like every second post, and maybe they're just trying to make as much money as possible in case it gets banned and leverage in it. But YouTube, I really like this idea of long form storytelling, engaging content, where you're weaving in, overcoming those objections, like why would someone not buy it? And you're bringing that through all the content and you're just stacking and stuck on the salesmen at heart, like I know that sales is just transferring that certainty to someone that, you know, building that up over time with the right way, I think creators will come up with it. And just to have that bang bang shop pay two clicks, I can just see this being an absolute home run. So that's what I'm really excited about. Well, I love it. And I'll just mention TikTok, great sponsor of the show. We love them to bits. I'm sure TikTok shop is going to explode here in Australia. I'm sure it will. I can't wait for the day of, I'm in sort of our racing for Australia. It feels like everyone's just got their strategies ready to go. But what I love about what you're saying there with YouTube is that it's shifting the way we're thinking about content again, because we've been taught to kind of come back to that short form, real format, instant attention, walk it in. You've got one key selling message, straight up, hook, out, sell. Tell us about, and I'd love your thoughts on this hander as well, as we're expanding it now into long form content as a selling mechanism. Surely, let's spitball some ideas here. What are you thinking beyond unboxing videos? Oh, look, I use my mother as a litmus test for everything, right? My mother absolutely loves buying from a woman by the name of Natalie Angel. It's, let me try before you buy. Now, every Friday, she has a live where she goes and stands in front of an Instagram feed or whatever it is and literally just tries on clothes and gives those lifetime reviews of the fit on this one isn't quite right. If you're a certain size or a certain height, this isn't going to be a good one for you. She has built such an amazing community off of quite literally just doing that and having really honest, real, raw reviews of garments. I think that is the future of what long form content is going to eventually, it's already morphed into, right? Now, Natalie Angel could tell my mum to buy anything and she would. And the thing is, is that my mum doesn't just buy it, she will then go back onto a community and say, I loved this recommendation because of X, Y, Z, like everyone else get on board. And that's the power of it. You know, that's where I'd kind of see that and like, there could be so many different variations and versions of that, but at this, the very simplest of forms is building a community where people get to speak to other people around common problems and pain points. There's a bit of authenticity in that too, right? Because it's like, actually, I don't need to clip this into 20 seconds, 60 seconds. I've actually got a bit more time and space to be the true me. And as you're creating that authentic connection, like it's the most important thing in sales is like, you have to have rapport first. If there's no rapport, there's no sale. But once you have that connection, the feeling of commonality, which is built through trust, built, is that whoever has more certainly influences the other person and then bang. And this is where those, those right way to close and it's so easy to buy. And I just think the long form too, like it's the short form is just this very impulsive, hacky, buy throw away, team who stuff sort of, yeah, that's going to bomb through that TikTok channel completely. But I do believe for the $100 plus items, all that, this is where this YouTube and how it can be put together, the curation, I think is so important, right? Outfitting, you know, but how you're curating and curating looks together, explaining those, those little details that you can't, can't always get it through on a PDP. You can't get it through on a, no one reads a description or thing anyway. But it's like, that's where that authentic, it really feels to me as like a big opportunity. But my idea would be, okay, how are you creating content from your stores? Like my biggest sort of secret as College Kings is that the stores I put as, they were studios, right? They were the content generating machines that we've been doing since 2017 of the Snapchat days, each one with the individual Snapchat right through to is that they, they are just such a great place for authentic content. You've got the backdrop, you've got it all, you've got the people that are knowing like they're selling this stuff every day, they know where someone buys this pant, right? It's because of the way it sits, the fit, the fit around the ankles, that baggie, but not too baggy look, how you can sit it over the Jordan Falls or tuck it under, all those little details that, other ways sort of found, when you translate through to online, it's just, it gets lost and it gets, but those little things, when you're in the store and you're dealing one to one with customers, you see their eyes light up there the moment they, that's when they make that purchase decision, that's when they're like, I'm sold. And so that's where I sort of see, I think physical retails that aren't creating content out of their stores are just absolutely mad, throw out all your SLR cameras, destroy them all, just buy one iPhone for every store and one road mic and run a tally and a comp and say if anyone gets a video with a million views, you'll pay them $1,000 cash and you watch them fucking create content and you'll have to sort of, because chasing views, they might do stuff a little bit edgy, which can be off-brand, but my thing is in this firehose world of TikTok, it doesn't matter, no matter how bad you think it is, trust me, everyone will forget it in two friggin minutes. You know what we should do? We should do a Shopify promotion, which is like an SLR buyback campaign. So I was like, you know, you buy back and just replace them with shit your team can use. Yeah, road mic and the iPhone, and it's like, yeah, it is always the, uh, there you go. Harley, if you're watching the buyback campaign, I've got a question on that. And I think it links into what you've been doing at Shopify this year, Hannah, around does it actually change the retail model as a whole? Because as we build authenticity, as we build audiences, essentially, not just customer bases, does it change the way the products are distributed? Because Simon, you did a great post around Mr. Beast's distribution strategy for his last deodorant. And we've obviously seen... Oh, Jake Paul. Yeah, yeah. Oh, Jake Paul, sorry. Yeah, yeah, yeah. Jake Paul. And we've seen it with Mr. Beast as well. He's kind of taken a different approach to a D2C approach. Does it also change? Once you own an audience, does it change your retail options as well, rather than just being a D2C player, does it change how customers get their hands on it? So it does in the sense that there's never been more channels to be able to sell through at this point in time, right? And the aim of the game should be to be able to sell everywhere. And if you think about the fundamentals of that, is that you need to know your audience, you need to know where they're going to be, and you need to meet them there, right? And conversely, it might be that you are a traditional D2C retailer, but actually, you know that most of your customers are shopping in store. And so you've seen this blend of traditional D2C players moving in to reach our storefronts, and then obviously, traditional retailers now really wanting to take that online game for store. I think High Smile is a perfect example of this. They have come out number two in their category in Woolworths. Which is... Unbelievable. And you know, when that launched in store, I was the hater on it. I was like, no one's going to buy $18 toothpaste at Coles. Like, you know, it's never, but you know what was the breakthrough that was the aha moment for me? It was like, if you worked it out, they would have spent more on advertising than 10X any other toothpaste brand. So they had so much top of mind awareness that see, it's just like the Red Bull theory, right? Because you only have that split decision to make it stand in front of the fridge at 7/11. And that's when it's like Red Bull wings, all the friggin', but that's the, that is that brand implant that makes you make that decision. And that's what High Smile had. And they didn't even realize they'd spent all this D2C building it up. That once it went there, unbelievable. Like their results are just, and that should be, you know, so much where I'm like, for some of these is just gassing the D2C. And yes, grabbing that market share because you can then just jump over and then bang. And even at a premium price point, like so premium, like, I thought, I'm sure a lot of us thought like, ah, that's, it's such a pressured consumer or a thing, but it's, it's nowhere near as, I think people weigh overestimate that sort of stuff in their own sort of bubble. And these examples just prove it. Yeah. And I think about the basic four P's of marketing as well, like they recognize that they had to have variety in their product. And if we think about their audience, obviously the D2C is probably attracted more of that 30 to 40 year old buyer, but if you've got a pink, bright pink, strawberry flavor toothpaste that's sitting in store, all of a sudden you're appealing to children and you're appealing to potentially a new demographic. So I just think that they did that transition really well. And honestly, my opinion and perspective on the market right now is that the players that have done D2C really, really well are going to be the retail disruptors. And I think that that's because they know their audience really well. As Simon's just said, they've done a great job at that top of funnel awareness. And when they come in store, they're, they're going to know how to do it right. And we're seeing more and more examples of that. So has the retail model changed? Absolutely, but for the better because it makes it easier and easier to be able to distribute market, sell your product from wherever. It's also giving new opportunities to those solar entrepreneurs to launch amazingly successful businesses incredibly, profitably. Yeah. And it was, that was one of the key stats that I thought came out of the research report that 43% of Australian customers prefer shopping in store last year, that was 38%. So that's a big job. Yeah, it is. But you know, it was 31% that also prefer shopping online and 28% where they say I don't care. So yes, that start in isolation is impressive, but the reality is there are lots of people that like shopping every single channel, you have to not just focus on one type of demographic. So your experience and what you offer has to show up consistently across channels as opposed to us just going, I do install really well. It doesn't matter about my online. It just doesn't cut it these days. Like as a customer, who is, I'm a very picky customer, my expectations are sky high and I know I'm not alone on that front. And so every brand has to be thinking about setting the right expectation and experience across all channels. So I mean, if you were starting a new brand today from scratch, would you start a D to C or would you go straight, store straight up? The money like I've got now just do the stores as well because, you know, it's so much about building that experience and content out of it as well. If I didn't, I had to do it. I'd just start and build that really tight little flywheel and test the product market fit so you know, you know, you've got it humming and then going to stores. But I do think when you get the store and online working so well, creating the experience, the feeling, but I would do the extours of such extreme thinking, how do you resonate a memory unit? This is just such an important thing that people forget is their chance of a store unless there is a shift in a state like your emotional state changes, unless there is some change, you'll never remember it. And that's what I always position culture kings. I wanted like, okay, if someone's going to pack for air, it's going to walk through all the stores, if you just ran up and interviewed at the end of the day and say, what is the one shop you remember from today, I wanted to say that culture king stores, there was a DJ and this guy shooting basketball. And then we got the chance to win these shoes in the core machine and the staff was so cool. And it was like, oh, that's what I wanted was to resonate that memory from the experience from shifting their state. And this is like, I think there's so many ways to do it, but you have to think of that first, because then you create a brand experience that when you smash them again, especially you shop a five positive store, you get the phone number, you get the friggin email, right in the kiss of when they get that SMS again, or they get hit with an ad on Facebook again, that memory comes back, ideally the positive experience. And that's they'll actually see your ad because see, that's the thing we forget so many of this content, you can be doing it, but they're so blind to it. You know, next time you're at a, like next, I always do this next time you've see like a Gen Z key or something of the airport on their phone, just watch how fast they scroll. It's mind blowing, right? How quick they're going through it. And so when you think you're getting an impression, it doesn't mean anything. It's on the biggest one on hook rates, the first three second, you only look at past that because otherwise it's just nothing. What's a hook rate, how do you define that? So in the ads, you create your hook rate is basically how many people watch the first three seconds as a percent. And it's one of the biggest sort of, it's like, I can help so many people show it, it's like anyone, it's like with my retail payment, give me your best ad, I guarantee I'll fucking beat it. Like because all I'll do is I'll just tweak the fucking hook and then bang, you know, because it's so many, it's still at 30% hook rate. And then if you can change that to 80%, you've paid for the same impression, but you've got three times as many people to see it. It's just a bit of a, but to switch it back to the store experience creates the brand that they'll remember. So yeah, if I was doing it again, I'd do these crazy, wild, over the top store experiences that is these holy shit, ah-ha, wow, pull my phone out moments, capture that, capture the customer and capture email and then hit them up. And as long as you'll, you'll bring that feeling back when they see the ad. And then when they're in that, I've got an event, we've got this thing to go to. I need something new to where that ad will hit them at the right time because the Facebook AI knows everything and then it will, I'll click through and convert and hit that shop pay button in two seconds, it's done. I've got a great experience, but the digital, it's a great example, but the digital version of that, I don't know whether you've interviewed him yet, Bushy, but Jared from some, sometimes always. Oh no, we're talking, we're going to do it later in the year. I'm going to ruin the story a little bit. So this can be the pre-tease, but he does something in that business that I just thought was so genius, particularly in a market such as selling wine online, right? And they have really beautiful site, go check it out, it's awesome. But every single time somebody is a first-time purchaser, what they do is they send a personalized video of them walking around the warehouse, giving that kind of, here's where this wine has come from, here's a little bit about this wine, here's how you can enjoy it, here's what food it goes well with. We love this choice because of X, Y, Z and it's so personalized that they quite literally have people sending them videos back of them drinking and enjoying the wine. And oh, look, here's how I decided to drink it. And I'm like, that is genius because it's the last thing that they remember. It's the last thing that they go, this brand had such a personalized touch point with me through a digital medium as well, which is actually very similar to the experience I'd get in store. But I love that as an example and I thought it was a good build from what you were talking about, Simon. My biggest advice for those young brands is do that unscalable stuff you can't do when you're big. If I had a brand, it's like get your first thousand customers, I would DM everyone, I would follow up individually, video message every single one, thanking them, showing me an outfit, engaging that back because you just can't do that at scale, but you can create those raving fans that can just be your biggest advocate. That is one of the biggest opportunities for the smaller brands right now is doing the unscalable. And yes, there's going to be ways to bring this in with AI and everything, but it's crazy too. Like anyone in art accounts now is like how this, because of the low fire, you know, winning right now, but these founders adds and how much they're still like cutting through so well because it's that authentic nature. I think we've got such a bullshit meter now for ads. That's why the high production doesn't work. The second you see that pro footage, like they just scroll, it's gone. And you'll see that in the hook rates. That's why I'm a big one, I'm smashing all the SLRs, but what's your favourite hooks at the moment? What's working? Street interviews, absolutely fire, but this is what I would say is that I think they're going to be fire for a while, because they're hard to do like it's actually take skill to stop someone on the street, right, and get rejected a hundred times and thing. And then actually you've got to put in the work to get some gold out of them. Yes, you can set them up and stuff, but there I sort of feel you can see through those as well. But those are still absolute fire, mainly I think because golden rule of advertising is the ad, it's got to not look like an ad, and because that's so much the organic, that's driving through, and it's just this authentic nature, as much as you can get that test and that feeling and get across from the cut, get that wow moment, get the ah ha, you know. Or a practical question, do you actually have to get releases from people you stop on the street to use them in ads? I don't know. I don't know. Ask them all. That's for somebody who thought about how long is it going to last and just take it down? I love it. I love it. But you could create a DocuSign and stuff, and yeah, I'm definitely a bit scrappy. That's where it's like with a once it got big in public company is like, oh, I feel so hamstrons. You know, I want to just, I want to, you know, I think I'm still economy at heart. I love it. What we're talking about though, there's a lot here that we're talking that scrappy that's authentic that's behind the scenes, which kind of flies in the face of where runs running with AI. Do you reckon it's a bigger opportunity than ever to almost be, not ANSI AI, but being very specific around where you use AI and where you just buck the trend and go, no computers touch this. We are going to be as just scrappy and authentic as possible and you know, this is an AI. I think though, this is what's going to happen, that AI content, I'm not saying this, this, I think that's part of your building your content flywheel. You need someone organizing UGC creators and putting that all together, someone running your own team of creators where it's all content, this freaking street interviews. But then as well, we'll be AI content generators on your team that are just creating stuff to go with it, but I do get worried, I do get this feeling. I feel we've already, this would be interesting if you think this as well. I feel we've already developed such a bullshit meter for chat GPT, like how much does it piss you off when you see a LinkedIn post written by chat GPT? Or someone sends you an email or a cover letter to a resume, like please don't ever do that. That is like, but this is the thing, we can see it a mile away when it's written by it. And I sort of feel the same way we've developed that so fast, we're going to see it for content. As much as it's going to be good, I don't know, I just think we had this amazing pattern recognition, we can't quite put the finger on it the same way we can pick it up. But because it's going to get flooded with it, it's so easy to create and it's no barrier to entry and every most crazy idea is going to do it. I do think we're going to see crazy like that whole, you know, fixing category from movies content across the world is just going to be completely AI because you're going to be able to think of the most crazy stuff you couldn't imagine and create it with AI. But can you imagine the 18 year old Simon B, he'd be gone nuts with creating content left, right and center with AI, wouldn't he? You know what, my 18 year old self right now would be all over these YouTube faceless channels and then getting these YouTube affiliate, you know, with the Shopify and then just building this friggin like one man band just crank. That's what I'd be on right now. That's awesome. Hannah Shopify released a whole bunch of AI features in your drops this year and it's been a real central theme. How are you seeing retailers adopt those features but being able to build brands that are authentic and mean things to people while taking away some of the stuff that doesn't have value? Yeah, I think just adding onto Simon like creativity is not dead. If anything, it's more and more important to be creative because that's what drives and relates to that authenticity that we were just talking about and you're right. People can smell chat YPT from a mile away. And so it's important that we don't get carried away with that. The on some application or hero application of AI and automation that will never go away will keep on getting better is through business efficiencies. All of those mundane tasks that you don't want to do automated and why not like we should be leaning into it from that perspective. I use chat YPT as my Google search, you know, Simon, as we were talking just before, I literally typed into chat YPT, what is a hook? What are the top 10 hooks that are currently being used? These are things. We can use it as prompts to get us better at thinking and thinking broader and more creatively around the way in which we're doing things. So the tools that Shopify has released are all about making life easier for you to run your business, which is directly related to those activities and tasks and all of the mundane things in the background that may have taken you five hours, but you can now do in 15 minutes. And that's where we're going to see it just evolve and get better and better and better. And I'm personally really excited for that day. Simon, you said before that you spend a lot of time in ad managers and that's where founders should be spending time. Obviously a lot of, even from a marketing perspective, a lot of that is automated now. Where do you think that it's a no brainer just to go let the machine take control from an operational perspective and then where do you need to keep your eyes on the ball? It's more and more that the targeting is completely gone. It's the creative does the targeting, but and it's so, like you can run a real simple creative testing advantage plus two stage set up manual bids, but it's like crazy how much like the DPA and stuff, it's a very simple set up and it does not take long to learn. Yeah, it used to be all this skill. I remember years ago we used to chop all this data, the lookalike audience, all the hacks that we can like none of that is there anymore. It is so simple, but the key is being able to look at the data and understand it and then take action from it. But this is the key. If the founders looking at the data, they can make such better decisions. It's like take coach Kings, for example, say when I was running it, if we had an agency, we would have had this Nike shoe, oh, this is getting seven row ass, put all the budget behind that. But I'm like, but wait a minute, this same water jacket is getting six row ass, but I get 80 margin on that. The same, the Nike shoe, I'm going to sell them anyway. So I turn the Nike off and triple the budget in the same order. And the other thing I look at, repeat customer by product, that's a Kilometri. Because one, you find these amazing products that when someone buys it, they're way likely a becoming a repeat shopper, but as well, you find toxic products, especially for men, this is really important because we don't return stuff, we just never shop again. So you might find something you're selling at once and then never coming back. But that was the thing is that same water jacket had a 80% repeat compared to Nike, they're flaky as they'll just go whoever's cheaper on Google. So it was just, and see, that's where the difference is an agency would have just mashed that Nike. Everyone's like, yeah, we sold out the night where I would have been screaming you idiots. This is what, and this is the alignment, right, of understanding the ad account is because when you understand it, and this is the founder, the CEO just has so much more context and knowledge than anyone else. It's not fair. They know, oh, I can get that same water jacket in 60 days and still smoke it for the rest of winter. Or I could, if I made a thousand of them, I could learn that 20% cheaper and then put even more into ads. And then they're learning off the creative, they're learning off all these parts of the business. And it's, I'm not ripping on agencies, the thing is if you have an outside agency and they don't, they can't see contribution margin. They can't see profit, like they're flying blind and then they have no creative to work with. It's just like, it's not fair. And that's where that model needs to change, but it's especially as I do it, I'm like, like these founder CEOs, it's like, don't palm this off. Like you need to learn this because if you are an e-commerce company, I hate to say you're a freaking marketing company because you have to have that as part of you. And just to understand, it's so important because whatever platform comes next, they've all copied campaign, ad set, ad level, they're all copying, meta, they're all doing it. It's going to sort of all relate in a way. And it's the thing is if you look at it every day, you have this touch and feel on the customer because you're seeing what they're responding to, why are they clicking on that? Why did that work? Why did that one not work? Which I thought was a banger and it was just 10% hook rate. And it's like, oh, the hook's cooked. Let's just change the hook and bang in a way. I love that. The hook's cooked. It's the best thing ever. That's my, yeah, on the being in the ads manager, it's just don't get to think you're too big or thing like I was doing this when we were turning over 300 freaking million every day. I don't think you're a little $10 million business, you're too good for it. I love it. Hannah, I know that you work closely with a lot of agencies here in Australia, both from marketing and development perspective. What are you seeing from the best agencies in how they're evolving and changing their services to econ clients? It's such a great question and I work with a broad spread. I like to look at it from this perspective. The most value that an agency could provide is the fact that it works across multiple different brands, which means they get really good at identifying problems and common problems. And so I say this to everyone I work with, learn how to solve problems in a scalable way. And the agencies that are doing really well at the moment are not just doers, but they're consultants. They take a very highly consultative approach to solving problems and provide solutions that are easy to implement, easy to scale. It's funny and Simon, you probably hear me out on this one. It's so easy to say you do that really well and much harder to execute. So yeah, we're really lucky in this, I think in this region in that there is so much to choose from and so many great agencies that have scaled multiple brands. So yeah, if you ever wanted me help, you know where to come because I can give you the honest reviews. I love it. That's a pretty good offer. A lot of people will want to take you up on that. I think there's a theme coming through this as well, and we kind of touched on it last time. It's around speed to decision making too. Like I don't think you can just be a service provider. You can't just be a manager. You can't be an analyst. The value you bring to an organization is in making decisions quickly and executing them. Is that fair? From my perspective, absolutely. And if we look at, again, just taking it back to the Australian retail report, which is second edition, so everyone jump on and read it and I'm sure, Bushy, you will attach the link for everyone to download. It's fantastic, love it. If you look at where a CTO is spending their money at the moment, it's business intelligence. And why is business intelligence more important now than ever? It's because the data is needed to be able to make good decisions and make them quickly. And so I think it's fairly widespread that this tech is just getting faster and faster. You need to be ahead of it. To be ahead of it. You need to understand what you're currently doing, what's coming, and then analyze it to make the decisions on what to do next. So I'm a director and you make the best decisions inside a business or outside of a business looking in? Well, I still feel inside, you've got more context. But I'm a huge one of, especially as a CEO entrepreneur, you just have to have outside people that you can pressure test your big decisions with. I think it's one of the things as CEOs entrepreneurs, right, you've got to have an ego to start a business because everyone else is like against you and it's a bit of like this. And if you look, you've got an over optimism bias because even the odds are starting a business, you know, 90% fail in the first three years or whatever, you've got to buck that trend. But what I've seen though is when they grow, the ego can really, that's the thing that can bring them undone, especially like I saw this heaps in fashion, right? You've got everyone around gassing you up, yeah, Simon, that's a great idea. Yeah, let's put stripper poles in the store. And it's like, but if you don't have anyone that will push back and really pressure tests and, you know, at your level, I think that's just so important. And that's like I was thinking with the agency, the consultant part where you can do it. But, you know, because that's where they've got to be that right relationship, which is so important. And at the end of the day, as what I always had his own advisory board, but I still own 100% of the shares, still my decision at the end of the day, but I liked to have to justify it. I liked to see because I've got blind spots and push my ego barrier. And this is so important, I think, as an entrepreneur too, because you've got a, it's a double-edged sword, that ego, it's the thing that can do it and drive it, but it's the thing that can just run you blindly off the cliff as well. There's something nice around making sure you've got that person next to you, whether you are a founder or whether you're a manager or whether you're just starting your career that you can bounce things off that doesn't have a vested interest. So they're not an agency trying to upsell you or they're not, you know, they're not a someone else in your team trying to get a promotion to tell you what they want. So they get the promotion. It's like, actually, they can give or take it. But here's my advice. Yeah, and you know, I did, because Shopify had these amazing meetups that I would go to and I always was learnt so much and those became part of my advisable. That's what actually did is starting this One Life Club for that was I wanted to recreate that magic that happened at those Shopify meetups, but as well adding in a bit of the grey hair experience as well. So you've got offense and defense battling it out in, yeah, that's what I sort of, but it was like, I really owe Shopify putting together those, like, I remember those were the nuggets I fit, you know, Danny from Milk Run when he had koala and I was like, oh my God, that was like, oh my God, mini chat and Snapchat, this hack. And it's just, it was those were just worth, you know, thinking back just millions and millions of dollars and Shopify always been so good at that creating that entrepreneur ecosystem, that's what I wanted to sort of create and share for these other ones. I don't have the glory of Shopify as well. So in the last 12 months, you mentioned before, you were, you know, working with these up and comers, these 18 year olds, 20 year olds with these big ideas, got an inside word on our good ones coming through that we should be keeping an eye on. Well, just go through the TikTok shop top brands. And this is something I always did as an entrepreneur is like, you've got to stay learning and look like the numbers don't lie, check the scoreboard. It's not these awards or crap, they're just all made up anyway. You actually go for the list and see who's ranking. What are the, I would rank, I remember this in like 2017, I've found like the top spending ads in America. And there's this one iPhone case, I hunted down the kiddos, 18 years old, can you ever remember seeing that ad with the stick on the back and it was like the chicken, the mirror, anyway, spent $6 million on this one ad, you know, made a fortune, 18 year old kid. I hunted him down and me, my other, paid him $1,000 for him for an hour. And he taught me it, how he did it, this manual bidding and every night he'd reset him at 12 o'clock, they'd get the learning. He basically, it's what advantage plus does an hour automatically, but this was before it. But it was like, I, this kid had just unlocked it. And that's what I always try and hunt down and see is who are the actual ones that are actually making the breakthrough, actually got the wins. Because as well too, they're not necessarily, they don't have the money off the table and it's all fun like me there, they're all up and they're hitting the gas pedal as hard as they can. They're not going to tell it on no podcast or something, they're just going to gas it. But that's how I like to learn and stay, stay on the edge and stay relevant, because this is the thing is that you can get around and everyone can sort of say doom and gloom and stuff. You wouldn't have to pay $1,000 out of that chat now, would you just go, I'm Simon Beard, I won't have a chat. Well now, now it's good, like it's good, I can just hit him up straight away and I'm on the call. But that's part of like why I wanted to, you know, create my own personal brand and stuff out there too. You know, it's, I really sort of see there is a huge benefit there of just cutting through and saving a lot of time and I just love learning because it's, this is the funnest part about e-commerce, right? It's all changing. It's all like the, you know, where we think from the days of bloody magenta and couldn't sleep at night and think crashing before Shopify and then Shopify and unlocking all this and the gory days of, you know, afterpay and, you know, all these magical innovations and how much we took advantage by staying on that edge, staying on the new testing, learning, seeing what works and what doesn't. And then when it does, this is the key. You've got to throw down, you've got to hit the pedal, you've got to back the truck up and I see that a lot with entrepreneurs where, you know, I'm helping now my retail attainment one and I can do the numbers and I'm like, this is to the moon freaking back the 3000 order of this jacket. They're like, oh, I'll get 300. It's like, no, it's like, it's, but it's just that risk tolerance they're not used to. You've got to, and I, I suppose that's something as you, as you grow as an entrepreneur, you grow that threshold of control and the numbers, um, change. You've got to get that merch sorted for one club, like back the truck up. The hooks cooked, like music on so many phrases that will be just flying in the econ merch space. Ah, no. Yeah. Yeah. I suppose you got some big, you got some bigger fish to fry reckon now, but it's, it's great. It's, I'm having a lot of fun and, and learning and growing and I love, I love one helping that entrepreneur community in Australia because it is this thing of like, you know, what is it? The highest Shopify stores per capita, isn't it? Something, Hannah? I cannot confirm or deny just searching chat JPT as we said. Yeah. Just give me a second. But we absolutely punch above our weight from a global standpoint in that we are one of the top markets for, for Shopify, which is telling because there's a lot of stores globally on Shopify. Yeah. And I just want to encourage those entrepreneurs and, but give them as much the real facts and stuff. Like I'm not saying it's easy or it's like this lifestyle business, it's the freaking opposite. It's a hundred hours a week, but it's, it's, you got to be able to do and know the foundations of every part of the business. But when you do it and you connect it and you pull it off and you see those, you log in and you're, you're excited to check the ads manager to see, did that ad work, the dashboard when you see it up and green to the right, it, it lights you up and yeah, I want to see more brands in Australia, be these global brands and, and I'm sure they can, you know, it's like all this stuff that I learned, I didn't invent it. I just learned it and did it and oh my God, it worked and get your hands dirty doing it. They can do it faster and bigger than me. I'm sure we'll just keep happening. That's brilliant advice. I love it. You've got me pumped. But Hannah, that's what I've loved about this conversation. We kind of started going. It's not all derm and glimmer. There's plenty of opportunity. The retail report showed that too, like with something like three and five Australian businesses are looking to expand internationally in the next 12 months, 60% are looking to increase their marketing spend. So it's definitely not derm and gloom to close us out. Hannah, tell us around your advice for the next, say six months, we're recording this the end of August going into a little bit of peak planning, peak trade soon. What's everyone going to get right? Oh goodness, look, I think just following on what Simon said, it's an ever evolving journey. So you're constantly learning. I think actually it's a great time to try new things, try new strategies. Obviously, we are coming into peak periods, so get your fundamentals right, know your numbers, know your audience, make sure that you're spending money in the right channels in the right way. Think about how you're really providing value that goes over and above discounting or pricing to your customer base. I think that's a massive one. Like loyalty takes many different forms, value takes many different forms. Don't assume that everyone is expecting a discount. Think creatively about what you're doing there. And look, it's typically not the best time actually to think about international expansion during peak period, but there are so many brands right now, Australian brands in particular, but absolutely killing it overseas. So if it's not in your roadmap over the next six to 12 months about capitalizing on the fact that you can capture an audience via your content and online channels in other markets, particularly the US, you'd be crazy not to look into it. So yeah, I know that that's many different forms of what you should be looking at doing, but there is so much going on. Just stay focused on the fundamentals. And don't cook the hook. Don't cook the hook. Goodness, I need to get more into my hooks now, I think. Love it. Guys, this has been a lot of fun. We've got to none of my questions that I planned, but it was a great conversation and really appreciate it. Hopefully we can do it again next year when the new report comes out. Thanks so much for giving us your time and your great insights. Always great fun. Thanks Simon. Thanks, Hannah. Thanks, Bushey. Thank you. All I can say is, can we please make this year a tradition? One hour is never enough with Simon and Hannah. Not only do they deliver a wealth of practical tips, but it's just such fun, especially when we go off-script. Here are my three key takeaways from this episode. Number one, master your ads. Simon highlighted that successful e-commerce founders are deeply involved in their ad accounts on a daily basis. Understanding and managing ad metrics is crucial for profitability. His advice was that those who leave it all to agencies often end up shredding money without knowing what works. We heard this not long ago, too, from Anita from EuroPackaging. Even with all his investment in AI and him stepping away from the day-to-day of business, Simon remains hands-on with his ads. AI can help, but it's not a substitute for staying closely involved with one of your biggest investments. Number two, omnichannel is essential. Hannah pointed out the growing importance of omnichannel retailing, especially for D2C brands who want to grow. With 43% of Australian customers preferring to shop in-store and many more spreading their shopping across various channels, it is becoming crucial to have a physical presence. But as Simon noted, it's not just about being present everywhere, it's about creating memorable, standout experiences like CultureKings did. Make sure your omnichannel approach not only exists, but leaves a lasting impression. And number three, don't cook the hook. Simon stressed the importance of the hook. Those crucial first three seconds of an ad that either grab attention or lose the viewer. We advise brands to focus on improving their hook rate, the percentage of viewers who stick around after the first three seconds, as this can make or break your ad's success. Thanks again to Shopify for bringing us this bonus conversation. If you haven't already, make sure you download Shopify's 2024 Australian Retail Report. You can find it at Shopify.com/au/enterprise/retailreport2024 or find it in our show notes or our blog post, go give it a download and see what insights you can come up with for your business. See you next time. Before you go, we'd love to invite you to join our free e-commerce learning platform at Decart Campus, meet other professionals and learn from e-commerce experts to take your business and your e-commerce career to the next level. Register to join campus at addecart.com.au/campus. Now, if you enjoyed today's episode, make sure you share it with a friend or a colleague or even better. Leave us a review on Spotify or Apple. It really makes a difference. [music]