Whether you own a bricks and mortar retail business and wondering how to benefit from the massive growth in online retailing; or you have an online E-commerce store, and are wanting to take it to the next level, then you’re going to love this episode.
My guest today is Paul Greenberg (Tweet him here) and he is the grandfather of online retailing. Paul was the co-founder of DealsDirect, a pioneering online department store model that launched in 2004; and he is also Executive Chairman, founder and principal ambassador for NORA – National Online Retailer’s Association.
Listen in and discover:
- The future of online retailing
- What bricks and mortar retailers are getting wrong
- What online retailers are getting right
- How an offline retailer could successfully partner with an online retailer
- The role of customer service and brand and in online retailing
- What Paul would do if he were setting up an online business today
- Plus so much more
Plus I share my learnings from the Great Vic Bike Ride and I tackle a question from a listener who asks:
“I have been listening to your podcasts for the last couple of months and have heard some really good ones. I have got some obscure ideas from some of them. My problem is working out how to implement them into my accounting business. Accounting, and the town I live in, seems to be extremely conservative. I am just trying to work out how to implement some of the marketing options that come from your podcasts. Hopefully I can get the courage to implement some of them soon. I like the idea of being a disturber in the industry.”
Let’s waste no time and get stuck right into episode 217 of Australia’s #1 marketing show. Go!
- 1.45 My learnings from participating in the Great Vic Bike Road
- 13:00 I introduce Paul Greenberg of the National Online Retailers Association
- 16:58 What does the modern world of online retailers mean for offline retailers (and we use Wiggle as the example)
- 20:05 The idea of adding value or getting out of the way
- 21:15 The idea of getting off the high street and moving in to an industrial estate!
- 24:20 Intermediation – the removal of the middle man
- 26:24 The future of department stores – shopping by brand
- 29:20 Multiple touch points
- 32:15 Customer service discussion – Give the wheel to the shopper
- 35:00 Is Paul optimistic about the future?
- 38:02 The importance of email in retail marketing (AKA your digital umbilical cord)
- 40:25 What should you be offering online versus what your customers can get online
- 48:15 Helpful marketing versus amazing marketing
- 48:45 What would Paul do today if he were setting up an online business
- 51:51 My top 5 learnings from my chat with Paul
- 55:10 I tackle a listener question about how to get things done
- 58:44 Marketing quote of the week
Resources and Links Mentioned in this Episode
- 99Designs design marketplace: For logo design, brochure design, and more. Grab your exclusive listener upgrade at this link.
- Netregistry: Get your online marketing sorted!
- N.O.R.A. – National Online Retailers Association official website
- How to get stuff done episode
- The how to create magic moments episode
- Join the The Small Business Big Marketing Forum now to listen to the exclusive Q&A I did with Paul
- Crank My Marketing
Paul Greenberg’s Interview Transcription
I welcome you to the show as the grandfather of online retailing.
Well, I sure wish that was Godfather, but unfortunately, it is grandfather, you got that right.
Isn’t that amazing, gosh I read on the subway on the Nora website which basically came from the fact that you started DealsDirect in 2004, which really does make you a grandfather in this space, doesn’t it?
Well, I think that you are right and I think it’s a compliment and I don’t think my kids are proud of their dad being a grandfather already, but look I think 2004 was very much pioneering years in pure online retaining in Australia, but to be fair, going back before that, I started tinkering in the later part of the ‘90s in this space and we can talk a little bit about how I ended up starting DealsDirect. Then of course, last but not least, I’m also slightly older than the average younger online retailers so that is how the grandfather came up.
Gosh, you and I are similar; father of teenagers and that might be the battle of the best dad joke for the next half an hour or so.
Now listen; I’ve got a confession to make. I have become a middle-aged man in life right now. I started bike riding about two months ago and I asked fellow cyclists where to buy some bib and brace and what I meant by that, was locally. Like where is the local bike shop that I should go to and get some bib and brace and he suggested to go to the UK based site Wiggle.com.
Oh, everyone knows Wiggle, yes.
Now, I buy online, don’t get me wrong and I knew that I was going to have to spend a bit of dough because cycling is not cheap. So, I go there and I get my bib and brace, its half price right. It’s efficient; I got it within like five or six days. There were customer reviews on every single product. I was asking questions of the staff. I’m 6’4” what size should I get? And I have been to my local box store since then and I feel really guilty, Paul. So, what does all this mean for the local retailers? This new online, well not new, but, this online marketing that is really hitting at straps now.
Well, I think the Wiggle example is a great one, where, you know, initially and when I say initially I mean 3 or 4 years ago, we all got a bit of a panic as retailers in Australia. We saw this flat world, because let’s face it; we are living now in a global cordless retail. We all about had an anxiety attack and thought we were going to be invaded by the barbarians and our lives were going to be eaten.
We will talk a little bit about the pricing inequities, but with my NORA hat on, I’m shifting and saying we basically have an enormous opportunity. Yes, the world is now flat and there is no question about that. The digital age has flattened the world in ways we could have never foreseen, but that means our addressable market as a retail industry goes from the 25 or 26 million Australian population to billions. And I see it as much more of an opportunity than as a challenge. But, I’m happy to talk through that Wiggle example, if your listeners are interested.
Yeah, I just think that’s the pointy end. We can talk and I am interested to ask you after this discussion, about some of the trends that we are seeing in online retail because I think it is worth walking forward. This thing is happening so fast but, let’s pull apart the Wiggle example.
Right, we had a fabulous CEO, who was out in Sidney a year ago and that’s all exciting and maybe these guys come out, has actually moved on out a man by the name of Humphrey Cobalt, but he came out. You know you can learn from these guys, but they are, as you mentioned, the key to the MAMIL, the middle age man in life and we are all one of them, but they really pioneered, innovated and mediated what was traditionally very much a corner store business, you know.
We used to buy our kids bikes and our bikes and accessories down from the local retailer. And of course, there was often, you know, Australians got a higher cost based to do business. And we don’t have the volume; our addressable market is our population, which is pretty tiny. Now Wiggle is based out of the U.K. and they have sold globally, the world is their oyster.
They have got a lower cost base in the U.K., not much that much lower, but certainly lower than Australia.
I wouldn’t have thought of it to be significantly lower, but clearly they have volume.
They’ve got huge volume, they are a global business and they got a little bit of a lift up in terms of supply chain and distribution, it does seem to be that it is a little cheaper to be shipping from London to Sidney than it is from Sidney to London and we can talk a little bit about that too. So, let’s give them the hands up that they had the leap on us and come out of the box blazing fabulous customer experience. It is a pure play model.
Pure play, meaning there is no off line presence.
There is no offline for now, but online only, which traditionally is being assumed to have a lower cost base and I think it does through the shipping. This is where it excites me, I was talking to the son’s mom and pop retailers that I used to buy my bike from and they were saying this Wiggle is going to kill us.
And I’m afraid for many they will put up the white flag. It did mean either the end of their business or a shift, but those who were happy to roll with it are now partners with business like Wiggle and doing the value ed. service. If you buy a bike from Wiggles, which you can and a lot cheaper than you can buy it here, who the hell is going to assemble it for you? Who is going to check it for safety? Who is going to make sure that your pedals are adjusted correctly?
And that is where your community based bike retailer still has a significant future and in fact moves up the value change from, I’m going to beat Wiggle in price, which you can never do, to, I’m going to partner and align.
This is going to grow the slice of the pie and there are far more MAMILs on the road, we are all on the road now, there is pelotons everywhere. The pie is getting bigger, how do I get my clip of the tickets and the clip of the ticket is variably around services and value ed.
Okay, so I’m going to be the local bike shop and listens please be a retailer in this instance and right now we are talking bikes, but I’m sure what you’re going to say can apply to other industries. So, what you’re saying, therefore if I listen to what you’re saying and don’t put up the white flag, Paull maybe what I should do is take some space, get off the high street because rents are high, take some space in an industrial estate and advertise the fact that I’m here to put your bike together?
Totally, go one step further, you contact Wiggle and declare yourself a partner. You will be the Sidney, Brisbane, Melbourne or the sub of South Melbourne of Wiggle and I have no doubt that they will then support you because they also need support. There are reverse logistics, returns, repairs and servicing. So, these global power players are also looking to partner with people on the ground.
If I’m in the back stores of the industrial estate and I’ve interviewed a couple of businesses over the last couple of years, who have literally gone off the high street into the industrial estates. One was a brewery and the other a café, but, am I now just assembling bikes? Because my customers have bought their bike off Wiggle, which I’ve assembled are going to go back to wiggle and buy all the accessories, which I’m guessing, is a greater margin. So, am I selling any product now or just a service?
Well, you’re certainly saying to customers, you’re not going to beat Wiggle on price and your being up front with your customer. You’re saying look, no one can beat Wiggle, but your customer from Timboe to Timboe will often need something immediately.
You might have a race on that day and you’ll need a tube or something like a new saddle and Timboe is still a challenge for consumer direct retailer, so there will be plenty of occasions where you keeping the essentials, the consumables that your customer will need stuff in real Timboe. And by the way, is happy to pay for the privilege of you holding that stuff for him.
But, I think yes, your finding there will be more of a shift towards a more serviced based, you’ll still sell product. There are still plenty of people who want to buy locally and that is terrific news for our industry. They are still plenty of people who are happy to pay a little bit more for local service.
So, it’s not as here is some game, but I think yes, you’re business location becomes a little less important in my view, particularly with leaders like social media and mobility where you can pull the customers a little closer to you and you don’t have to sort of hijack them on the high street. So, you can move a little bit out of the high street, bring your reigns down and then focus on that service piece.
So, this example of Wiggle does play beautifully into the model you’ve just described which is become the service providers, partner with Wiggle, don’t fight them; join them. And you’re talking, I’m thinking okay, maybe now is bike ride title where I could be doing is running information sessions and charging people to become an educator.
Become the person who puts on events or, you know, you could blow that out into quite an interesting business, if you choose to. And that works, because Wiggle has got things that need assembling, but what about, if I’ve got the closed shop. I’ve got a 4-year-old daughter and I reckon, the podcast is a bit of a dilemma, because there is a knock at the door every day from a stray post track delivering another piece of clothing. What does that mean because the clothe shop has got nothing to assemble? Do they just shut down?
Look, I think the important thing here that we need to discuss, and in many ways you might have discussed it with your listeners and some of your guests, Timbo, but disintermediation is a fancy word for something very simple. It’s the removal of the middleman; its root word is intermediary.
There is going to be a challenge and there has been a challenge for retailers, there still is a challenge for retailers and there is a bigger challenge coming, that for those retailers that are simply selling, and I don’t mean and disrespect, but they are simply selling other peoples products and taking a margin for the privilege. It’s not going to get easier, in my view, unless you’re innovative and you’ve got something special.
And, just on that point, creating something special could be, and we’ve spoken about this in previous episodes, an experience. Well, there is an experience in every business transaction, good, bad or indifferent, but a retailer like general pets, right? The stocks lots of different brands and going into that store as a young person, when I go in there with my kids, it’s an experience, it’s cool. You know, the staff are cool, there is music playing, there’s displays so, if you’re not offering that that, you are really just occupying space.
I couldn’t have put it better myself. Absolutely, there still is, of course, plenty of legs for selling other brands, but you have to create what they call curation and theatre. You’ve got to create the environment where your customers want to come and congregate and community experience and if you’re doing that, then again much like the Wiggle example, you move into the value ed.
You’re not just putting out your wears, putting a ticket on them and saying here we go. You’ll get a bit of business like that, but it’s going to be hard to sustain it. And so, those good retailers that are selling other peoples brand, and by the way, I’m quite bullish about our department stores, particularly like David Jones and Meyer, I think they are coming back stronger. In many ways they have done two things to challenge this mediation the way retail is moving.
Well, No.1, they built their own house brands or they bought them, for example, a Meyer would own Sass & Bide, which is a very popular women’s fashion business so, you can only really get it at Meyer with outfits that they selected, and of course, they are creating more experience and more theatre in store, so that people was to come and be detained and Meyers recently advertised and it really speaks right to that.
So, we have seen a pretty powerful response by retailers realizing that things are changing. By the way, you walk on the high street and you see the brands like Expresso, Apple, Samsung, Zara, Nike, Verosky and I could go on forever. What is different about those, well, they own the product in their store.
Yes, that’s interesting; you’ve just answered a question of mine. So, listeners, we are in Melbourne and we’ve just had a big shopping complex built in the city they call Emporium. I walked around it when it opened a few months ago, Paul, and I’m looking around going, you know, this is really interesting, they are all one brand stores. There are a couple department stores like a Japanese one, which I can never pronounce the name of, not dry blow but whatever it’s called.
Yeah, Uniqlo, but these are all one brands. So, the New Balance, the Timboberland and the Swarovski and I get it now. So, these guys own that brand and I can buy them online for the same price they are selling them for in the store so, they kind of got the mix right, yeah?
They haven’t. I guess one of the pinnacles of our conversation will be the message that I would love to leave your listeners and customers thinking by brand not by channel and I’m sure we will be talking about when we talk about online retail.
Well, let’s go, notepad will be kept right here. What do you mean by that?
As head of the National Online Retailers Association, people come to me all the Timboe and ask if online is better than offline and will online eat the offline lunch. You know, bricks and mortar is the bigger sort of the part of the business and online is always going to be a sideshow.
The key point that I think everyone is missing and I’m including myself because I came from online retailers, that customers don’t think by channel, they think by brand.
So, if you’re calling yourself a bricks and mortar retailer, you probably have a bit of work to do, but I’ve also challenged some of the young guys and the pure play online areas.
You call yourself an online retailer, you probably also got a bit of work to do. You’re saying to your customer, I’ve got 1 channel to market and like it or lump it and I think customers are awarding multiple touch point.
So, the reason I say this is because you spoke about brand and that is really where customers are focused, whether it be a Timboberland, a Black Milk, a Zara, a brand is king and we all have to remember that.
I had the Black Milk guys on a couple of years ago, and wow that was a good conversation. In fact, one of those guys is on the board, isn’t he, at Nora?
Well, in fact, they are on the board at Nora and I love the board at Nora and I love what they’ve done and I guess since you’ve spoken of them, they continue to shoot the lights out. In fact, we are taking all of the Nora members up in early December we do a full tour of the Black Milk facility. So, I’m very impressed and talk about a poster child in new Australian retailer and I’m very proud of what those guys have done.
What they do so beautifully is build community. I mean, when I was speaking to Cameron and it was around Christmas Timboe, in fact, just after Christmas, and they were so under the pump at their Brisbane manufacturing facility. They guys, by the way listeners, make leggings. They were so under the pump that they got online on the Facebook and started to arrange for measurers to go around to headquarters to start to mess out some of the stuff. Yeah, there is just a lot of love in that room; A lot of love.
A lot of love.
So, right point, we do buy by brand and we don’t buy by channel, but mind you, my kids would much rather buy a pair of Levi jeans from General Pants than going to Meyer to buy them. So, they are still choosing brand.
Of course, they have chosen General Brand over Meyer and it absolutely makes sense to me. So, they are shopping by brand and by the way, someone is going to General Pants store and someTimboes I will buy from the General Pants website. I think you’ll find that it’s not always that conscious, it just depends on budget, location, convenience, availability and all the above. So, brand is first, General Pants is their brand of choice, great and the channel is the one of the secondary where are we today chocolate, strawberry or vanilla.
So, Paul does it, one thing I love about one of the marketing truism is creating experience and building an emotional attachment, part of that is the human experience. I felt there was a little bit of human experience when I dealt with Wiggle because I was going on to their discussion board and asking about size and quality and getting pretty quick responses, not immediate, but quick responses. But, you know, what are the good online pure play retailers doing to ensure that it’s not just a price argument?
That is a powerful point and rhymed in my sweet spot. You know I’m a psychologist by profession and particular interest in organizational psychology and consumer behavior and that’s the spectrum. What have gone to the broad brackets? You start with Jeff Bezoss, who is one of my heroes, obviously. He is the founder of Amazon. He said “the best customer service is no customer service”. Let’s just think about that. The best customer service is no customer service.
When I read that quote ten years ago, I got it. What he was trying to say is give control, give the wheel to the shopper, if the shopper is in control and they can do everything themselves. In other words, they don’t need you and they are in control, you’ve got a beautiful seamless customer experience. I get that, but I partly agree with it.
Because, I think on the other extreme, is my other favorite example and my other hero is Tony Hsieh who founded Zappo’s.com who is shoe store pure play out of Las Vegas. Now if you call Zappo’s and you get one of their customer service folks and you want them to order a pizza for you, they will do it. If you want to chat about how your kids are doing at school, they will give you a half an hour of their Timboe, no problem.
So, you’ve got Bezos who is very metric driven. Obviously, keen to make sure that customers help themselves because it keep their cost base down and builds his efficiency, the best customer service is no customer service, automate or perish. Then, on the other hand, you have perhaps a bit of overcompensation, I might argue, because of the digital model where you don’t come face to face with your customer, you’ve got pure plays offering obviously, first of all multiple price points, including live chats in telephony as well as email provider some ridiculous levels of customer service and really sort of extreme connection for one of a better word.
So, those are the two brackets and I guess probably somewhere in the middle, is the truth, that customers do want an emotional connection with a brand and they do want to be bought and I think using your Wiggle example its clearly been a satisfying experience because they were able to serve your problems and speak to you in a personal way despite the fact that you know they have millions of customers and that is a pretty darn good feeling. I think there is a broad bracket and often that is going to depend on the business model you run, the margins that you’re dealing with and your kind of infrastructure. There are two very broad examples and try and pick your place in the middle.
I want to go back and finish the loop on the idea of the clothing retailer who, what you said earlier, get out of the way if you are just the middleman. Either get out of the way if you are just selling other peoples brands and if you’re not offering a super duper experience that will encourage people to come into your store. So, just to be clear, I want to start talking about trends now. Those guys we are going to see the demise of through what I hear you say, yeah?
Look, I think I’m very opTimboistic about Australia, but I don’t was to be a Pollyanna. We have already seen a lot of attrition in this space and we have seen a lot of those of sub-par retailers who relied simply on flipping the ticket, not providing any value add in the chain, they are either gone or they are on their way.
I’m obviously keen to see a Renaissance and I believe we are in the beginning technology lead retail Renaissance in Australia that is very broad and if we take the wave, the clever country, the Asian century in a global technology lead retail, this could well be our Timboe, but unfortunately, those wont cross the Rubicon will get caught in the floods.
Okay, what do I have to do to cross it, Paul? Because we are seeing that the biggest shopping center in Australia, in fact, it may even be the southern hemisphere, which is Chadstone in Victoria, there are about to do this massive expansion with more shops, really? Like I don’t get it, I don’t get the business model.
My boy is finishing school this year in business management and throughout the year he has asked me, how does that shop make money? And some Timboes I can tell him and other Timboes I just shake my head and go, Jack, I don’t know. So, we see these retail shops opening, these department stores or shopping centers increase their footprint, what are the retailers that are listening going to have to do to cross the chasm to continue to computer?
Well, the first thing I think, those Westfield’s and the Chadstones of the world I think they are very smart people and they are doing 100 percent the right thing. My late father actually taught me this, he was an aviator and he said to me once, “if a plane stalls heading towards the ground, what do you do?” I said, “Well, you pull back so you can pull the nose up.” He said, “No, it’s exactly the opposite; you push down as hard as you can and that’s what will pull you out of your dive.”
And these retailers have worked it out, these big Westfield’s and they knew things are going to be better and more glorious, more glamorous and more of the theater and more of the cathedral than ever before and that’s pushing into the dive which is a supper smart thing to do as opposed to pulling out of it.
The shoppers are flooding back into stores in droves and they are doing some very innovative things, straddling the cuffs between digital and physical, which is really where the honey pot is.
Okay, so, what can the little guys, the ones that are listening to this learn and how do they push down?
The first thing, the little guy who has got a shop, here is the good news, well done. You’ve got a shop and the worst thing you can be doing is saying “oh my God, I’ve got to get into online which would have closed my shop,” wrong.
Your physical location is a significant asset and don’t minimize it. You’ve done a lot of the hard yards and made a lot of investment in physical infrastructure, which is a very important part. Customers do want multiple touch points and want to physically engage with you, but you dare not do a un-channel model. If you’re just relying on your shop for footfall, you’re not going to make it.
You have to have that digital umbilical cord to your shopper. So, my challenge to you is, when a shopper comes into your store, whether they are buying or been in the store and they don’t buy something, what do you do with that shopper? The guy has walked in, had a look around, you’ve traditional asked him can I help you; he traditionally says no, I’m just looking and he leaves and the tickle of the belly as he leaves the store. That is the wrong thing to do.
That shopper needs to be induced and encourage connecting with you in another way and what are those ways. Well, the simple way is to say to the guy, how about giving me your email address and by the way, no customer is going to give you their email address, unless you give them something and what could that be?
A little gift, a discount, a coupon on his next purchase, something. Don’t expect anything; we are from, what’s in it for me. The customer will give you his email address if you give him something and you have to find out what the something is.
It doesn’t have to be anything big. Then the minute you’ve got an email address, you have the ability to connect with that customer, whether you send him a monthly EDM. You go with what I call a digital umbilical cord or a golden thread. The other way to sell him is by saying, would you mind coming into our Facebook world and just have a look at what we are doing.
You need to make sure that there is an online connection, because customers move and someTimboes they are online and someTimboes in the physical environment and you want them to remember you. So, unique channel models are out, it’s going to get harder to be just online only, particularly as things get more competitive.
And, I’m talking in generalism, there is obviously a niche where that doesn’t apply, but in broad terms, it’s going to be harder to be a bricks and mortar retailer, you’re going to have embraced the digital divide and it’s not that difficult.
If the bricks and mortar retailer, who is listening now, and says, it sound like Paul is saying that I need to get a digital footprint and that doesn’t mean just a website or having a Facebook page. What your suggestions is in a commerce platform and you’re getting this digital umbilical cord and you’ve got the email address of the customer. So, do you go set up a little ecommerce and shopify part of your website and just sell what you’re selling in store, online? What do I do or what am I offering them online that can’t get offline?
Totally, of course the good news is a shopify website would cost you $100.00 to set up word press and maybe a little less than that so , you not talking about bill, I don’t want to oversimplify this, but it’s not huge dollars to get involved.
Absolutely, yes, you have got to offer you customer the multiple touch point. So, if your product lends itself to be home delivery or consumer direct delivery, then there is no question, you should have a website. Now, what is your message to your customer? We’d love you to come into our store, but, when you can’t, we are still open for business.
It’s a simple, pragmatic and obvious message. We’d love you to come to our store, but we know you’re busy and when you can’t, we are still here for you. You know where we are, you have a problem, and you know where to find us, because we’ve been here for a long Timboe. But you have to have that digital connection.
Okay, so, to me, I’ve got my retail and I’m the clothes shop owner now. I’ve got my shopify section of my website of my online store happening, but that’s just a 24/7 argument. You know, one of the game changers about the Internet is that we can get anything anyTimboe of the day or night so, where is the magic now? We are in 2014, soon to be 2015, where is the added magic that I have to put on beyond just having an ecommerce section of my website?
Well, absolutely, the honeymoon is over for pure play online retail. You know, it was a bit magical and I had the best of it around 2004 to 2010 where it really felt like we were doing something new, but the thing is consumers are king and queen and they are raising the bar. So, the new magic, by the way, I don’t want to digress, is a three-hour delivery, for example, or a ninety-minute delivery or clicking collect. There is new magic, but the old magic of a website, well that’s just retail now.
Well, it’s the ticket to the game.
It is a ticket to the game, but remember brand first and channel second. So, the customer likes your brand, he’s in your store and he’s coming for stuff because he likes what you are doing. He is going to buy online from you, not because online is sexy, because somebody just can’t get to your shop and you’ve got offer in that twenty-four hour touch point.
It’s less about magic and more just about convenience. I say it’s more about respect. You can’t tell your customers that you are going to close your shop at 2:00 p.m. today because I don’t feel like staying open and similarly, I’m not going to have a website because I just don’t feel like servicing you after hours. They have grown to expect it and it’s the new norm.
Yeah, okay, so adding value, adding extreme service with three-hour delivery. I saw that Amazon is delivery in some part of Seattle by drone and that’s crazy and sound like instant delivery. Is that real or is that in play now, but there is a u-tube video of drones landing in your driveway with a package from Amazon.
No, look, I love innovation, but to our listeners, I don’t want to create too much Kool-Aid and blue sky here. The three hour delivery is not for everybody, it expensive and only for the select few. And I would say those retailers keep their fashion higher up the value chain dealing with a bigger end of town in metropolitan cities. Someone has got to pay for it and it’s costly, but you don’t have to do that.
Assuming the drone example, Timbo, well, Bezos’s is talking about it and it’s certainly not active yet. I can tell you that the aviation authority would have a little bit to do with that before that gets off the ground. But you’ve got to encourage that kind of innovation because who knows; one day it might be a reality, but not yet.
Yeah, totally. Okay, so the magic is in and the added value to you just now being open 24/7. And I guess it’s the clothes shop owner too, if I am selling online, sure I can tell my customers who come into my store who are locals, now the world has opened up. Theoretically yes it has, but how true is it?
Am I really going to get someone? You know, I’ve got my little clothes shop in Melbourne, is someone really from Sussex England going to buy from me?
What is that sitcom where they say, I’ve only got two words to say to you; no just from Kath and Kim? I’ve only got two words to say to you Timbo, Black Milk. A couple of little young guys in the garage in Brisbane starter making together some leggings from a homemade sewing machine and now they can’t keep up with demand, globally. Forget about locally, they certainly have their local fans, but globally, it’s a massive business that is, by the way, manufacturing in Brisbane, distribution out of Brisbane, yeah, Black Milk.
Okay, here’s the thing and I’m being the cynic. Amazing story and I will put a link in the notes to this episode to the Black Milk discussion, because I was incredible. One of the things that I try to balance and I’ve been doing this show for five years and I talk from stage about marketing, all the Timboe and there is this balance between amazing.
So, you’ve got the left and right scale. Amazing and helpful, right? Amazing is a marketing strategy is really hard to do. We should all strive for it, but Black Milk do amazing marketing, they really do. They build their call, they’ve got a tribe, and they just do crazy stuff.
Then you’ve just got helpful and I love helpful because helpful it easy. You help your customer and your prospect make an informed decision and they may well buy from you in price, may become less important. So, Black Milk is amazing, so, how can we pull back and say to the offline retailer that it’s okay and you don’t have to be Black Milk?
Timbo, you are absolutely my kind of guy. I’m your mere mortal and agree with you. These guys shine the light for us, but we are not them and not everyone can win the lotto, right? But, there is so many examples of smaller businesses, some are home based, who are selling a niche products.
Look at on your desk, just a small niche product with a bit of Australian on it, to something that you can add value and selling it around the world. You know, my late grandfather used to say to many years ago when I was a baby, so when I was a 15-year-old a long Timboe ago, you could sell one thing to every person in China was always a metaphor, now of course you can’t.
And that’s really our world, the world is your oyster and you can find a product, a line, a bit of Australian, something that is unique and a little bit different that you can really add value and you don’t have to be amazing or exceptional, you have to be helpful and diligent. The world is waiting for you, brand Australia is open for business and there is demand for what we’ve got and we just have to get out and take it and it’s not that difficult.
And, I will put another heavy on the amazing thing. In fact, I have interviewed the girls from Frank Body Scrub and that is a wonderful online business out of Melbourne. They sell a caffeinated body scrub and my daughter buys it. I’ve talked to Steph about it and the excitement of it arriving in the post, because it comes in a really cool packaging and a really cool envelope with a really cool note and it’s beautifully designed.
So, there is experience and it’s amazing. That amazing is not hard, they just put some effort into design. So, it can be done and I always want marketing to be achievable for anyone who is listening. Hey Paul, we are going to in a minute finish this interview and then do any exclusive series of Q and A for my forum members, but, before we finish, one last question.
You set up Deals Direct in 2004, you did the happy dance every day for 6 or so years as the register went cha-ching, cha-ching throughout the day and night. If you were setting up an online business today, what would you sell and what are the first three things you would do and how would you market it? Now that is an episode in itself, but just top of your head, go.
Well, I’ll start off with a quick quote: Get Big, Get Niche or Get Out. I’ve got a niche, so, Deals Direct wasn’t everything to all men and I wouldn’t go there. It’s bloody hard and it’s expensive. I would find a niche product, so that answers the first part of your question. It would be a niche product with a strong Australian theme, but, it would be a global product so, in other words, Australia to the world.
Hold on second, what do you mean with a stronger theme?
I think brand Australia and this is my passion, is an underesTimboated brand. I don’t think we realize how much gravitas there is for our brand in China, Europe and the rest of the world. I think we have always known and I hate to use Black Milk again as an example, but I think it is way deeper, and in fact, I know because I’ve had calls from people at Amazon, saying we have done searches for Australia that we cannot fulfill.
So, I would find something that is unique to Australia, but is not just quirky and we are not just talking a hat with bopping corks, you know. Something a little bit classier than that and I would go to the world with a brand Australia. Slow range and a hand full of products, but with a strong Australian theme.
Okay, the first 3 things you would do to get your new retail store up and running?
I would go into a marketplace and start as I did back in the late 90s. I’d start on EBay and Amazon and Tmall and Tow Bow in China and Trade Me in New Zealand. So, I would start first on marketplaces. I’d open a website, but I wouldn’t lose much sleep about that and I would hit the marketplaces as hard as I could. Why, because there are hundreds of millions of shopper’s waiting for you in those marketplaces and you don’t have to worry about being found.
Well, that answers the third question, how do you market it?
Marketplaces will do it for you. Once you’ve got that shopper that you found on the marketplace, well, he’s your shopper and he will come back to your brand every day of the week. Come find him in a marketplace is much easier.
I just want to go back to point 1 about the niche being Australian. I have this show that is downloaded in one hundred and ten countries, including Kazakhstan and Madagascar so, they just have to find the niche. You’ve identified, locally, an Australian product as being a niche, but find a niche and don’t be beat.
And to your listeners in Madagascar, I’d say that there is probably demand for their product around the globe and I wish them well, because the world is flat and its global retail and they should be very proud of what they’ve got in their own back yard and they should market it to the world.
Paul, I have thoroughly enjoyed this discussion and I’m looking forward to the Q and A for forum members after this, but really good discussion. I’m going to guess there are probably some listeners, who either stopped listening because they are infuriated, maybe scared, and maybe despondent, maybe they have raised the white flag, but maybe on the other hand too, there are a whole lot of listeners who have now got a renewed vigor around the offline business. Thanks you for adding to that by the way.
My Top 5 Learnings
This week’s top five learnings from my chat with N.O.R.A.’s Paul Greenberg:
1. If you’re a retailer then don’t be the middle man – instead, add value, niche down or get out.
2. The best customer service is no customer service. Get out of the way!
3. Get big, get niche or get out!
4. Customers think by brand, not by channel.
5. Email is your digital umbilical cord! Be sure to capture your customers email address in order to develop an ongoing conversation with them.
Over to you!
Let me know YOUR #1 takeaway from this episode by leaving a comment below.
My guest and myself personally read and respond to every comment.
24 thoughts on “217 – How to nail online retailing with the grandfather of online retail, Paul Greenberg”
What an episode!
I thought #116 with Mia Freedman was your #1 show, but this one is at least a photo finish.
So many learnings, so little time.
Timbo, you have smashed it out of the park.
#1 learning, ‘People buy brands, not channels’.
Ah I do love your feedback, Arn. Firstly because it’s always so positive and pumps my tyres, but mostly because it’s full of character and puts a smile on my dial. Thanks buddy – I’m glad you loved it.
Crackin’ interview Tim! My all-time favourite. Paul was fascinating! It’s given me motivation to reduce our lead times, sell via Amazon, build our Australia-brand (love that!), and automate more so customers can design their own products. Thanks guys!
Just finished this episode Timbo and there were lightbulb moments everywhere!! Lots and lots of gold that was applicable to my position right now! So many great ideas and learnings to take from this one! Cheers mate, this was awesome!!
#1 learning was to no be a middle man, get big, get niche or get out!
Love the ideas you got from this chat, Jen. You have a business that is ideal for embracing Paul’s ‘Australian’ idea. Let me know if and when you do it.
Thanks Anthony. Which are you going to chase? Big or niche?
awesome show Tim, one of you rbest ever… Gotta go find that Black Milk one now… 🙂
Thanks so much, Kate. ‘Ever’? that’s a big word! Here’s the BlackMilk episode //smallbusinessbigmarketing.com/marketing-podcast-blackmilk-cameron-parker/
ok cool, I’m going to listen to the Milk thingy now 🙂
an awesome episode – worth another listen! A very positive outlook on retail – off & on line.
Fantastic, well done Paul & Tim. Some great insights yet I felt Paul still has soo much more to share on a number of topics, may be worth a revisit down the track. Rewally enjoyed this one Timbo, shared it with many of of staff. Hope you arm is well on the mend…
Thanks, Guest. Let me know what topics you’d like covered if I were to get Paul back for a second bite. And don’t forget there’s an additional part of that interview inside my Forum where Paul answered questions specifically from Members. Thanks for sharing with your staff – please leave a review on iTunes if you’re up for it ;0)
Agreed, Diana. He’s a very positive and insigthful fellow.
Wow, thanks for the positive feedback, and a photo finish with Mia Freedman is a big win in my eyes!
Thanks Kate, I know Tim loves the feedback you provide, and so do I 🙂 Here’s to a big 2015.
Thanks Anthony, your post made my day. If my learnings, ( and hey, my heaps of mistakes) can provide a few light bulb moments to others, well, that’s what its all about when all is said and done.
Thanks for that Jenny. There is a real opportunity right now, and I can sense you are all over it. Sure its a mountain to climb, but a mountain well worth climbing.
Thanks 🙂 Tim, please invite me back.
Your welcome Paul, thanks for sharing! I have earmarked this episode to play it over again!
Both Timbo! Continue to chase our niche and then grow that niche big!
Thanks Diana, much appreciated – I do think it is an exciting time for ” new retail” in Australia.
Thanks Diana, much appreciated – I do think it is an exciting time for ” new retail” in Australia.
Just listening to this one for the second time. Fantastic episode. Very hard to make notes whilst driving though! Great work Tim & Paul.
Thanks Jason. Keep your eyes on the road and hands upon the wheel ;0)