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The Agile Brand with Greg Kihlström®: Expert Mode Marketing Technology, AI, & CX
#553: Automating and Optimizing E-Commerce Operations with Jorrit Steinz, ChannelEngine
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- [00:01]
Strayer University Announcer
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TJ Watt
This is pro linebacker TJ Watt and I'm back for another active drop with YPB by Abercrombie. I co designed this collection to stand up to my offseason training schedule. My favorite is the Deltfit Tank. It has deeper shoulder cuts for better mobility and it's the one tank I never have to adjust mid workout. So you know we had to call it the TJ Tank Shop YPB by Abercrombie in the app, online and in stores. Because your personal best is greater than anything.
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Strayer University Announcer
The agile brand.
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Greg Kilstrom
Welcome to Season six of the Agile Brand where we discuss marketing technology and customer experience, trends, insights and ideas with enterprise and technology platform leaders. We focus on the people, processes, data and platforms that make brands successful, scalable, customer focused and sustainable. This is what makes an agile brand. I'm your host Greg Kilstrom, advising Fortune 1000 brands on martech, marketing operations and CX, best selling author and speaker. The Agile Brand Podcast is brought to you by Tech Systems, an industry leader in full stack technology services, talent services and real world application. For more information go to teksystems.com before we get started, I wanted to let you know that my latest book, Priority is Action seven Principles for Better Strategies, Decisions and Outcomes is now available. In it, I give ideas and insights for leaders and teams that need to make meaningful progress on their priorities. After all, our priorities are what we do, not what we say we'd like to do. You can find Priority as Action on Amazon or learn more on my website greggkilstrom.com now let's get on to the show.
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Greg Kilstrom (Interviewer)
When consumers can get what they want whenever, however and wherever they want. Simplifying and optimizing e commerce operations is key success.
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Greg Kilstrom
Joining us today is Yorit Steins, Founder and CEO of Channel Engine, who has built a platform that helps retailers and
- [02:33]
Greg Kilstrom (Interviewer)
brands manage their online sales channels more effectively. Yoret, welcome to the show.
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Yorit Steins
Thank you for having me, Greg.
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Greg Kilstrom (Interviewer)
Yeah, looking forward to talking with you here. So why don't you start by sharing a little bit of the the story behind founding channel Engine. And you know what, what inspired you to focus on simplifying global e commerce for retailers, brands and customers alike?
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Yorit Steins
Yeah, sure. It's not a very obvious choice to do because everybody that is in e commerce knows it can be a challenging task. So I have been in e commerce as an entrepreneur for more than 21 years now. So I set up several companies many, many years ago with a concept called website lease. Building e commerce sites for a fixed monthly fee. Now we all call it SaaS. Back then there was no SaaS and that started growing for retailers, for publishers that wants to start selling stu. And then one of my customers had his own e commerce operations. Super small. And just for fun, we decided to launch a few e commerce stores together. It was supposed to be a side business, became a main business. So where we started with one e commerce store, we launched a second e commerce store. All search engine optimized. Ran a bit out of hand. In the end we had 75 E commerce stores running. And that was in a period back in 2003 where there was no good e commerce solution available for our scale. So we built everything ourselves from e commerce platform, backend systems, wireless management systems, data feeds to comparison sites and all the stuff you can now buy in SaaS tools. And then over the years we launched our own marketplace and started selling on Amazon and ebay on all kinds of local marketplaces. And it didn't make sense to me that we had to build all these integrations to these marketplaces custom made. And I needed our commercial team to be able to control what we were selling on which marketplace in which country. Back then we had 30,000 different SKUs and you don't want to sell everything everywhere. So I thought well let's look for a solution. There was no good solution back then. So I decided to sell the previous company and then put in a lot of resources to build a new platform which is now called Channel engine. Idea was super simple, just build a connector and a management platform. But of course building a robust solution always takes time. So we've been building this out over the last 10 years and really started scaling from Europe to the US and now we are active globally with customers selling in Southeast Asia, Middle East, Europe, Australia as well as north and South America. So lots of things have changed. It's still exciting, still plenty of challenges, but we are now powering 950 marketplaces worldwide. So plenty of things to talk about.
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Greg Kilstrom (Interviewer)
Yeah, yeah, definitely. Well, yeah, so let's dive in here and it seems pretty straightforward that simplifying global e commerce is what retailers, brands and even customers want. But let's talk about two specific aspects and that's flexibility and findability. And could you explain the importance of both of these in this context?
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Yorit Steins
Yes. So if you look at marketplaces and e commerce in general, so the e commerce journey started when people started selling on their own e commerce site. They had to be found through Google or comparison site and that shifted slowly to Amazon. Then Amazon opened up as a marketplace as well. Then ebay opened their marketplace. And then over the years many more marketplaces popped up. A lot of retailers became a marketplace. So the market with number of channels started being fragmented and over the last few years that more retailers became marketplace, but also social media became marketplace as well, became transactional. So it's getting harder for retailers and brands to manage all these different channels. You have to go in and log in and optimize. And the most important thing is if somebody is searching on a marketplace or on a retailer site and your brand is not there at the right keywords, then you're missing out on that specific target audience. So being findable on this marketplace is extremely important because the majority of the product searches nowadays starts on marketplaces or starts on social media. So you need to be present there. And if you just rely on your own e commerce site, then you need to do a lot of above the line marketing, getting customers in. Or just rely on search engine optimization and sea and that's not going to cut it to truly become scalable.
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Greg Kilstrom (Interviewer)
Yeah, yeah. And so how has channel engine helped your customers achieve some of these benefits?
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Yorit Steins
Yeah, so channel engine is focused on connecting multiple channels. So many years ago if you just sold on Amazon, you could just log into the seller control panel, list your products, ship your products to fulfillment by Amazon and you're done. But as soon as you want to make the most out of your inventory, both for your direct to consumer shop as well as Amazon as well as other marketplaces, then you need to optimize product information. So you want to have it in a single location and then automatically syndicate it to not one marketplace or two, but some of our customers have over 60 marketplaces that they run with a small team. And then the journey starts because the marketplace needs to know how much inventory do you have in stock, in which warehouse? What is surprising, make sure you are competitive on these different platforms. And then once an order takes place, it needs to flow into your backend system, into your warehouse. Your warehouse ships it track trace information if it needs to flow back. So there's a lot of processes that need to be automated to do it at scale because otherwise customers don't receive their package in time. Or you sell something that's not in stock. And those are the things that Channel Engine fully automates.
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Greg Kilstrom (Interviewer)
Got it, got it. So let's talk a little bit more about. You certainly talked about ease of managing things, but let's talk a little bit more about this managing product information, inventory orders, pricing from that single location. Because I would imagine, you know, as you mentioned, some of these, some of the customers that you're working with have, you know, you mentioned 50 or more marketplaces. So, you know, it can be a challenge. So can you talk about the advantage to syndicate product information and all this stuff from a central point?
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Yorit Steins
Yeah, sure. So first of all, it's super important to get your the right product information on each and every marketplace in the format that they wanted to do. Every marketplace has a different interface and different requirements in terms of titles and descriptions and attributes, image sizes, etc. So in the ideal situation, you don't want to log into all these different environments and do it manually, especially if you have a couple of thousands of SKUs or hundreds of thousands of SKUs. But it's already a lot of work if you have 50 different products. So what Channel Engine does is connecting to your backend system can be a product information management system or your ERP or combination. And then from there we syndicate product information, translate it into the format that the marketplaces need, and then upload it to the marketplace automatically. But also if there's a change in your central system, we syndicate that change to all the different channels you are using. We even provide automated translations if that's needed, to sell in a different country and stuff like that. So an essential thing to do. And also our system knows exactly what the marketplaces require in terms of attributes. And attributes think of sizes, colors, materials and stuff like that are essential to be findable on a marketplace as well. So if somebody goes into certain categories, searches for a product, then there are these amazing filters on the left. And if you click on the filter and you don't have that attribute filled out, your product will not appear. So those kind of items are essential just to get started, to get your product information there, where the consumer is searching. And that's where it starts before you start syndicating and synchronizing all the other information from inventory orders, optimizing pricing, et cetera.
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Greg Kilstrom (Interviewer)
Yeah, yeah. And so, I mean, there's a lot to manage on a single marketplace. So you know, imagining doing, doing this across multiple, I mean, can you maybe give an example, you know, how, what, what does this enable a brand or a retailer to do when, you know, before they were managing, you know, 1, 2, 3, 4, however many marketplaces, you know, what, what is this? How does, how does this benefit them, you know, directly and maybe share an example of, of how, how this looks different.
- [11:39]
Yorit Steins
Yeah, sure, I'll give you two examples. So years ago, selling on a marketplace, you needed to upload an Excel sheet. When an order comes in, you download it, update your own inventory management system and stuff like that. But as soon as you have two channels or more, you need to make sure if you sell something on one channel, you need to take off the other channel immediately, otherwise you oversell. So some of our customers, I'll give you an example. There's a large retailer in Germany, they were already selling on 10 different marketplaces, but they wanted to expand and they were running into capacity challenges because there was so much manual updating. So they started using channel engine and at the moment there's a team of two people managing over 66,0 marketplaces across all of Europe. And that's a European play and that's across different languages and tax regions and logistics, all regions, et cetera, with a very small team. And they're super successful. And the other one is always a nice example is one of our customers, Philips domestic appliances. They started selling in Southeast Asia on Shopee and Lazada and zalora on the 3Pmarketplace. They ramped up in Europe, in France and the UK and launched in North America as well, both with their marketplace as well as with their direct to consumer shops, all running through one centralized platform. And they've been extremely successful so far. And we see that replicated by companies like Electrolux and even Fashion, different fashion brands and retailers as well. So makes it much easier to have full control, full visibility, but also making sure you can do it profitably as well.
- [13:32]
Greg Kilstrom (Interviewer)
And so maybe taking a step back now, let's, let's talk about marketplace strategy and as well as how choosing the right marketplaces fit into that. So what should brands and retailers consider when they're developing their marketplace strategy? And how does determining the right marketplaces to sell on fit into that?
- [13:57]
Yorit Steins
Sure, yeah. So the fun thing is nowadays retailers are also becoming brands. Many retailers have their own private label brands as well as brands that start retailing. So if you look in the physical stores, you see a lot of brands, flagship stores, selling their branded products. So all of them are now Selling on marketplaces as well. For brand, there's a different strategy. So if you are a brand, first of all you want to be in control. Is your product found on a marketplace when a person is looking for your specific product. So it can be, I don't know, running shoes and your brand needs to be there, otherwise the consumer goes to your competitor and you need to be in control. What does your product look like? Is all the product information there? Is it representing your brand story? That's the first part. Second part is you need to make sure your products are available whether it is bought by Amazon or bought by Walmart, but it needs to be available throughout the whole product range, especially when you do a promotion. If you look at retailers, retailers can really benefit from selling on marketplaces, sometimes purely to get rid of overstock. Sometimes it's a very strategic choice to sell to private label brands on the marketplace. But many retailers are becoming a marketplace as well. They and can be very simple by just opening it up to their brands to do backfilling. So if they run out of stock, they can still keep on selling while the brand drop ships it to the end consumer. Or for shoe retailers for instance, size filling for the weird sizes that they don't want to have on the balance sheet, the brand can sell them as well. If you look at the choices, what marketplace to sell on, is it really focused on which country are you selling in but also which vertical. So every region has its own local hero. So for the US audience of course it starts with Amazon, but also Walmart and Macy's and Sears etc all became marketplace as well. As well as TikTok is becoming super, super successful for some brands.
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Greg Kilstrom (Interviewer)
Yeah, yeah. And so let's talk a little bit about once the sale is made, the role of customer service. And everyone listening here probably knows and understands that it is important to have great customer service. But successful E commerce customer service has some specific requirements. What strategies do you recommend for these brands that are operating across multiple marketplaces? They're managing all of these things. How do they also maintain high standards of customer service?
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Yorit Steins
Yeah, I think if you look at the E commerce, the majority of the questions coming in for customer service is where's my package? Did it arrive in time? Can we do the return? So it's crucial to do have your delivery on point, well automated, so you don't sell something on one marketplace and the other marketplace at the same time, which means you would have to cancel one of the orders. So make sure that's all automated at a very high frequency, make sure you ship in time, truck tracing information is automatically going to that consumer. That avoids a lot of questions. And as soon as you have less questions to your customer service, your customer service rep have reps have more time to truly spend time on answering the other questions about your products. So the reason why it's so essential to do that, not only to have a good end customer experience, but also you get measured on the marketplaces. And being findable and having a high ranking on a marketplace is connected to your seller performance. So how fast do you ship, how many cancellations do you have? But also what are your review ratings, how fast you respond to customer queries? And it all ties into your overall success on the marketplace. And actually if you don't do it well, you can get penalized or even kicked off the marketplace. So it's a crucial part.
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Greg Kilstrom (Interviewer)
Yeah, yeah. And so a lot of brands might spend a lot of time on keyword research and product descriptions and photos and all that kind of stuff, and yet kind of fail on the customer service part or even lag behind. So you know what, what strategies do you recommend for brands that are wanting to maintain these high standards of customer service?
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Yorit Steins
I think high standards of customer service is making sure the insights are there so the customer gets tricktrace information in time. There's visibility for the customer service rep as well across all these different channels. So if somebody calls, they can just log into one system and immediately see what's happening with their order instead of logging into 60 different control panels and trying to find it out, which would take a lot of time. One of the strategies we see a lot as well is using AI to answer questions fast, have very polite but very informative answers. Super quick.
- [19:17]
Greg Kilstrom (Interviewer)
Yeah, and so let's, yeah, let's, let's talk a little bit more about AI and automation in general and just how brands can leverage automation for greater efficiency here. So how do you look at automation as far as enhancing the E commerce operations and what types of tasks are most effectively automated?
- [19:39]
Yorit Steins
Yeah, so I'm a big believer in automating all the stuff that's repetitive, meaning updates of stock, but also with content, for instance, we can leverage a lot of AI functionalities. So naturally we, like many companies, we built in a lot of AI functionalities to help our sellers, the brands and retailers using our platform to create new virtual bundles, to create new images, to generate product descriptions, to translate text, to connect attributes from their own system to the attributes that are needed on the marketplace. So all the stuff that typically took a long Time to do manual. We automated that with, with AI and naturally we show the recommendations and somebody needs to click on okay before it gets published on the different marketplaces. But it saves a ton of time. And saving a ton of time means you have more time to look at which channels are successful for you. Which channels can we optimize and leverage and make it even more profitable so they keep more time to do the smart stuff.
- [20:47]
Greg Kilstrom (Interviewer)
Yeah, yeah. And can you maybe, maybe just give an example? I know you've touched on a few already, but give an example of how Channel Engine facilitates this automation for its customers.
- [20:59]
Yorit Steins
Yeah. So Channel Engine is, you can see it as an operating system as well as a network. So once you connect, the backend systems can be your web shop, your ERP system, warehouse management system, multiple warehouses. To Channel Engine, you instantly have access to a network of 950 marketplaces. And as soon as you select one of the marketplaces, we start synchronizing all this information. So you make the selection what are you going to sell in this region on that marketplace, for what pricing. And the rest is fully automated by our solution, leaving you more time to strategize, create great products and then adding more regions as well. Think of product information syndication, stock level syndication, price optimization. So if you're selling a product that other sell as well, we know exactly who's selling it, how fast they can ship, whether they have availability or not. And we can reprice millions of times a day to make sure you have the right price, not always the cheapest price, but the right price to sell at a high margin, winning the buy box and have the highest volume. We automate insights, profitability, order management, cancellation, shipments, returns. So the full e commerce flow is automated through Channel Engine.
- [22:15]
Greg Kilstrom (Interviewer)
Great, great. Well, Jorah, thanks so much for joining today. As we look ahead, what trends are you seeing? I mean, certainly you've been in the e commerce space and seen a lot of trends so far, but what are you seeing shaping the future of e commerce and marketplace selling? How should companies be preparing to adapt to these trends?
- [22:37]
Yorit Steins
I think it's super important for brands and retailers to be in control and be agile. So it's great to have the name of your podcast, the Agile brand. Yeah, but it's truly the case. We don't know which platform is going to win and it doesn't really matter. So if you have the solution to connect any channel, optimize what products you're selling or not, and you can just click it on, start experimenting. It doesn't cost much and then expand from there. I do see a lot of acceleration with new channels across the globe popping up from Chinese marketplaces to retailers that are becoming marketplace to social commerce. I think social commerce is going to be way bigger than a lot of people think. We see many successes already, which means it's not just a click from TikTok or Instagram to your e commerce site, but you can actually purchase it on these platforms. So that's going to accelerate. Live shopping. You will see more live shopping on the e commerce sites as well as in social media. We see that picking up pretty quickly. And the other thing I see is that brands are taking more control over the whole retail funnel, selling directly on the different marketplaces. I see it more centralized. So the teams that typically did B2B and direct to consumer as well as their marketing teams are working more together, the ones that are truly accelerating at the moment in global teams. So they have one unified solution instead of having all these different departments across the globe figuring it out for themselves. And naturally things are going to go quicker with AI, machine learning, forecasting and stuff like that.
- [24:18]
Greg Kilstrom (Interviewer)
Yeah, yeah, Love it. Love, love to hear that. Well again I'd like to thank Yoret Steins, Founder and CEO of Channel Engine for joining us today. You can learn more about Yorit and how Channel Engine is transforming global e commerce by following the links in the show notes.
- [24:33]
Greg Kilstrom
Thanks again for listening to the Agile brand brought to you by Tech Systems. If you enjoyed the show, please take a minute to subscribe and leave us a rating so that others can find the show more easily. You can access more episodes of the show at www.gregkillstromcom. that's G R E G K I H L S t r o m.com While you're there, check out my series of best selling Agile brand guides covering a wide variety of marketing technology topics. Or you can search for Greg Kilstrom on Amazon. The Agile brand is produced by Missing Link, a Latina owned, strategy driven, creatively fueled production co op. From ideation to creation, they craft human connections through intelligent, engaging and informative content. Until next time, Stay Agile,
- [25:23]
Strayer University Announcer
The agile brand.
- [25:32]
Liberty Mutual Spokesperson
And Doug, there's nowhere I wouldn't go to help someone customize and save on car insurance with Liberty Mutual. Even if it means sitting sitting front row at a comedy show.
- [25:42]
Yorit Steins
Hey everyone, check out this guy and his bird. What is this your first date?
- [25:45]
Liberty Mutual Spokesperson
Oh no. We help people customize and save on car insurance with Liberty Mutual together. We're married. Me to a human, him to a bird.
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Yorit Steins
Yeah, the bird looks out of your league anyways.
- [25:54]
Liberty Mutual Spokesperson
Get a quote@libertymutual.com or with your local agent.
- [25:57]
Strayer University Announcer
Liberty Liberty Liberty Liberty the Jack Welch Management Institute at Strayer University helps you go from I know the way to I've arrived with our top 10 ranked online MBA. Gain skills you can learn today and apply tomorrow. Get ready to go from make it happen to made it happen and keep striving. Visit strayer.edu Jack Welchmba to learn more. Strayer University is certified to operate in Virginia by Chev and its many campuses, including at 2121 15th Street north in Arlington, Virginia.