1. Technology & Innovation

Jason & Scot Show Episode 260 – March Retail Sales and Amazon Shareholder Letter

A weekly podcast with the latest e-commerce news and events. In episode 260 we cover March retail sales data from the US Dept of Commerce, and Jeff Bezos final annual shareholder letter as CEO of Amazon.

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March Retail Sales

March retail sales data from the US Department of Commerce is out.

March retail sales were $556,935B, up 26.9% from March of 2020. Year to date retail sales are $1,589,538B up 16.4% from Jan-Mar of 2020. Non-store sales were $93,111B, up 16.7% from March of 2020.

Bezos Shareholder Letter

Jeff Bezos published his final annual shareholder letter as CEO of Amazon. As always it’s a must read. Don’t forget to re-read the original 1997 one as well.

  • 200 million Prime members globally
  • 1.9 million 3P sellers
  • 100M smart devices connected to Alexa

Episode 260 of the Jason & Scot show was recorded live on Thursday April 15, 2021.

Transcript

Jason:
[0:24] Welcome to the Jason and Scott show this is episode 260 being recorded on Thursday April 15th 2021
used to be tax day I’m your host Jason retailgeek Goldberg and as usual I’m here with your co-host Scot Wingo.

Scot:
[0:42] Hey Jason and welcome back Jason Scott show listeners Jason I was having a good day until you mentioned the tax man.

Jason:
[0:50] Yeah but I don’t think it I don’t think it was going to be taxed day anyway today and then it got extended so you’ve got all kinds of time.

Scot:
[0:57] Yeah there’s some complications there but all I’ll save that for another shift.

Jason:
[1:02] All right I look forward to hearing that podcast.

Scot:
[1:04] So there are some new Echo earbuds are you going to try this.

Jason:
[1:12] I don’t know I was actually on the fence I was not a I was excited about the first ones and then I was not that impressed and so I’m debating.
I’m assuming apples going to announce some new ones next week or at least there’s some some potential that they will and I kind of live in those Apple earpods so I don’t know if I’m gonna bother giving the new Echoes that try it kind of depends on if you get them.
If you try and for me I don’t need to try it.

Scot:
[1:37] Yeah I’m in the sink I tried the first generation it was like putting a pineapple in your ear so I’m not I’m not going to take that risk again I’m a I’m very happy with my earpod so I’m not going to risk it.

Jason:
[1:51] Yeah I guess we have the same opinion we’ll wait for someone else to fall in love with them first.

Scot:
[1:56] Yeah read some reviews see how they go
cool today is a big day for you Jason because earlier this morning the Department of Commerce came out with their big data drop and I know that’s always a big day for you so you’ve probably been tabulating collating
API in data sciencing AI in machine learning
and doing all that retailgeek stuff so tonight we’re going to keep it pretty short because we really want to focus in on that data
and then it was a pretty active Newsweek so we’re just a couple highlights we want to hit there so why don’t you kick us into the data conversation Jason.

Jason:
[2:35] Yeah yeah and to be clear I don’t care about the data at all I’m just super excited for an excuse to use my python script and the play in tableau.
Yeah.
Exactly so super quick refresher US Department of Commerce publish retail data every month they have two data sets the retail data set which is,
kind of two months in the arrear so today they published their official retail data from February and then the advanced retail data which is only 1 month old so they published,
the March Advanced retail data in the difference is.
The advanced retail data is based on about 5,000 surveys that different retailers filled out in the full month is based on,
something like 10 to 15,000 surveys and there’s a lot more math and are correction in it so it’s it’s slightly more reliable.

[3:33] To be honest for the most part we use the advanced retail data because it’s fresher.
So so in that data is there their view on how much played out and March is kind of an interesting month this year because.
March last year was the first covid affected month in in the United States and I would call it a partial month like mostly covid sort of.
You know started playing out in March so April would be the first full month and then this year.
You know the the current March numbers are likely heavily impacted by all the economic stimulus that went out in January and February.

[4:20] Um so so a lot going on to look at and the the top line is March this year was way up over Marge last year so,
we sold,
in this is retail only so I’m taking restaurants out of out of the US Department of Commerce data this is all categories of retail just not restaurants,
it’s we sold 500 56 billion dollars last month which is up almost 27 percent from March of last year and so you know that’s a that’s a huge.
Year-over-year growth,
partly explained by the fact that you know March was when retail started to have this huge dip last year and then we’ve got this extra bump from stimulus checks this year.

Scot:
[5:07] So I saw a headline that said 9.8 I guess that includes restaurants is that why that was different than what you.

Jason:
[5:13] That is month over month.

Scot:
[5:15] Excuse me.

Jason:
[5:17] Yeah every there’s yeah again I like encourage people not to pay attention to month-over-month for most for most retail purposes.
But that by tends to be the Top Line in the news so yeah we were up like 9 point something percent over last month,
um the even with restaurants the it was still a huge month of growth when you look at it you’re over year,
so if you want to kind of flatten out some of the special things that happen in March you we could then look at year-to-date this year versus last year so January through March this year versus January through March last year,
and that is also up healthy 16.4% so.
In general retail was you know growing less than 16 percent.

[6:07] Before this pandemic started so the fact that these these you know first three months of this year are up 16% over you know mostly in unaffected by the pandemic last year,
you know this this is setting us up for a pretty white if these kind of numbers continue which they likely won’t like this this is extraordinary growth.
And so then some specific things we like to pull out of those numbers.
One of the bombers about the advanced monthly data is there is not a true e-commerce number in there I wish there were but there is this thing called non store sales which is kind of a.

[6:47] A big lumpy superset of e-commerce and some catalog sales and some other things it’s the closest thing in this data to e-commerce,
and so that was up 16% over last year so also Healthy Growth that’s I would call that more typical growth,
and I try not to get too focused on that because it’s not a perfect match with e-commerce,
um so then in the categories this is the fun thing all these discrete categories that they break out we’re all,
over last year which has not been the case,
any any month for the last for the last twelve months of the pandemic right so apparel which has been absolutely blitzed by the pandemic.
Was up the most it’s up a hundred and one percent so that’s a combination of pent-up demand people starting to get shots and go out more and think about buying clothes and having you know some stimulus money burning a hole in their pockets but this.
Is a in encouraging sign because there were people in the apparel industry that we’re worried that like.
You know new habits that didn’t involve clothes stylish clothing had been formed during the pandemic.

[8:04] So everyone went on at least bought one fancy outfit apparently Sporting Goods were up 75 our percent Auto was up 71 percent and that’s interesting because Auto really wasn’t heavily impacted by the pandemic.
Behaved like we were worried it would but it ended up behaving about how we would have expected anyway so the fact that it’s up 71 percent is likely almost all stimulus money.
Furniture was up 47% restaurants which we’ll talk about in a minute first recovery they’ve had in a year we’re up 36% gas was up 35% which.
Arguably gasoline was the worst business to be in during the pandemic do-it-yourself was up 29% that’s was in Home Depot Electronics were up 28%,
and then you get into the stuff that was only mildly up which is general merchandise and health and those were the categories that most.
Benefited from the from covid last March right so so so even they were up but not wildly up and then only one category in the whole report was down,
um versus last March which was Grocery and that’s because of course we all rushed out and bought toilet paper at the grocery store in March of last year and.

[9:25] So
So that’s kind of the breakdown the one of the most important themes in these covid categories is the competition between restaurants and grocery stores and so,
if you kind of think pre covid restaurants and grocery stores had almost 50/50 split of dollars for four calories so we bought half of our calories from grocery stores have from restaurants.

[9:51] At the peak of covid in April grocery stores were getting seventy percent of the dollars restaurants were only getting 30%,
and then for most of covid it’s kind of been a 60-40 split so so that’s a you know that that’s a big enough shift that that’s a huge Boon for grocery stores and a disaster for restaurants,
so for the first time we started to see that Gap close a little bit as restaurants went down our grocery stores went down for the first time in a year and restaurants went up for the first time in a year so for the month we have this kind of,
fifty-four percent of calories going to grocery stores and 46 percent of calories going to restaurants oh that’s,
starting to show a little restaurant recovery which isn’t remotely surprising because I think you know everyone understands there’s a lot of pent-up demand to.
To get back to restaurants and so both you know whether and vaccines and fatigue all sort of.
Making it a little easier to get the few more meals from restaurants so those were my big takeaways any.
Anything surprise you out of any of that Scott.

Scot:
[11:10] For an online perspective the cops are gonna get harder for the next 9 plus months right like we should go negative almost you would think.
Relatively flat I don’t know.

Jason:
[11:21] In a lot of categories that they for sure have this first world problem of comping against there there pandemic out escalated numbers.
And so I’ve been joking around but you’re starting to see it in kind of,
the the analyst reports and what not it’s you know a lot of CEOs are trying to make this year over two years ago comparison so I’m calling it yeah.

Scot:
[11:48] I like to I may start to use that.

Jason:
[11:49] Yeah yeah and sometimes it’s valid sometimes it’s not but but yeah like you know the interesting phenomena about this whole thing now is going to be,
you know the people that got a temporary benefit from covid what can they do to hang on to some of that benefit right or lock in some of those new behaviors can you know if you.
Made more meals at home
like obviously restaurants are going to come back but is there some way in which you you keep people cooking at home one more night a week than they did before or you know working from home one more day a week than they did before all of those kinds of,
things.

Scot:
[12:30] Yeah I guess the one that surprises me is clothing I wonder if Within.
It just feels like athleisure is just going to it’s just massive share and people that I’m seeing in closed doors they’re not.
They’re not in the Macy’s they’re at the limit so I wonder if I wonder if that’s going to be more of a permanent thing inside of that clothing I don’t think anyone’s going out and buying a suit yet or anything like that.

Jason:
[12:52] Not a lot I’m with you I am relatively bearish on the apparel industry like I mean I think it was really.
Starting to struggle before the pandemic and then the the pandemic just obliterated it the it’s been so down that it’s not surprising that there’s pent-up demand and that you know.
They’re starting to have a rebound some level of rebounds inevitable but per your point how much of that rebound was.
You know fresh sweats for working at home as opposed to an outfit to wear to the bar right.
Why you know there is some evidence that you know there were more shoe sales and things like that,
so so you know there was so much repressed demand that that some kind of rebound is inevitable but I still think a you know it’s still down for the year and you have a long way to go.

Scot:
[13:59] How about the non-store do you think that if you ever looked at how close that comes up being to the e-commerce number or they publish it is it like plus or minus a couple of points or is it.

Jason:
[14:07] No it’s bigger it’s like it’s about 75 about 75% of non-store is e-commerce.
But the deviation is there’s enough standard deviation that it just not perfectly consistent which is why I don’t get too excited about the non-store number.

Scot:
[14:24] Yeah because it feels like so the non-store number was 16.7 right.
Feels light to me with the stimulus dollars because everyone on Twitter at least and obviously it’s a bias audience but you know the
the things I have visibility into and then what I can see on Twitter it does seem like there was a stimulus surge there in March that was printed material now maybe it was small in it that words end right.

Jason:
[14:52] Yeah and so I like there is the Brandon on store not being a perfect surrogate for e-commerce but then also just e-commerce data just stinks as we’ve talked about a bunch of times right and the.
Um maybe we’ll break it out for the next one but I keep this running list of reported e-commerce growth right so.
E-commerce is not a gap number right so nobody’s obligated to report their e-commerce growth but since it’s the best number in your financial performance almost every retailer they can’t help themselves when they do their quarterly earnings that are like,
comps were down two percent but e-commerce grew by triple digits and it’s often growing from a you know a small base and all these other things,
but so I’ve been tracking every public company that reveals it and I have a pretty good list of public companies that have revealed their e-commerce growth for the last,
three quarters and the common denominator of all of them is not one of them is at or below the industry average.
So like that that just doesn’t pencil out right.
There aren’t enough other retailers with enough volume to make that work.

Scot:
[16:07] Yeah that’s never made sense the what are any other takeaways from the data.

Jason:
[16:15] No I just so a like stimulus works it goes,
it goes right in the people’s banks and right into the retail store so that’s a super benefit like,
I don’t think you’re going to see any more stimulus right I think there’s there’s politically I think there’s a lot of fatigue around stimulus and went as the health stuff becomes less dire which happily it’s going.
The there’s not going to be the political will for more stimulus and so you know I think that the.
This is going to be another part of the comps problem going forward.

Scot:
[16:54] Cool nothing else on the data.

Jason:
[16:57] Nope nope that seems like plenty.

Scot:
[16:59] All right well let’s pivot to news it wouldn’t be a Jason’s got show without some.

Jason:
[17:11] News your margin is their opportunity.

Scot:
[17:19] Jason I hope you’re sitting down and you have a hanky there you know I know you keep a locking key in your in your pocket there.
Jeff Bezos put out the last his last shareholder letter today and it was actually Bittersweet for me I’m a,
you’re a retailgeek I’m an Amazon geek I guess and I hope you know a lot of people wait for the,
Buffett letter that come out and all that I wait for the Bezos letter so I really love his annual shareholder letter comes out when they do the annual report so that actually came out today,
and it’s really good so in there but it’s sad because it’s bittersweet because it’s his last one.
And you know as an entrepreneur and founder this one really was is kind of hit me in the feels I could talk about it for the whole hour but I won’t subject you to that,
so I split kind of my highlights into buckets one would be kind of takeaways for other people starting companies and then the other one would be,
just generally any one industry he released a couple of little news tidbits and in the letter and someone’s actually pretty,
a new disclosure that people have literally been waiting over 15 years for.

[18:30] So I’m the founder entrepreneur side you know he has created one point six trillion dollars of value for shareholders so that’s that’s pretty amazing,
um
Not many people can say that I do question the validity of saying you’re a day one when you’ve created one of the world’s largest companies feels like maybe it’s day one and a half I don’t know I know that Amazon onions get offended by saying they do so I won’t go there.

Jason:
[18:56] I think it’s especially hard to say it’s day one when you’re founder retires after 26 years.

[19:06] Yeah that’s Alaska territory right there.

Scot:
[19:09] Yeah I know encourage listeners to read this one it’s really good and one of the most fun things to do since we’re on this topic is go back and read the original you know what people call the 97 letter his first one it’s just amazing,
how he talked about.
So relevant today that it’s pretty amazing you know imagine trying to write something in 1997 and so much has been invented since then.
Let’s say that the smartphone social media and you know all these things.
It’s pretty amazing that he nailed then the trends that they would focus on for the next year’s.

[19:50] That being said I want to pull a couple of highlights he has a lot of the letter was really interesting because it did have this for the first time kind of like.
Coaching lessons for entrepreneurs and I picked out to the like there were many more in there so I’ll defer people can read that if they’re interesting.
But but the two lessons I thought were most interesting number one was create more than you consume and I’ll just read this little excerpt,
if you want to be successful in business and life actually you have to create more than you consume your goal should be to create value for everyone you interact with any business that doesn’t create value for those it touches even if appear successful on the surface isn’t long for this world it’s on the way out.
And you know I thought that was just a really nice way to summarize a philosophy of doing things he’s in the crosshairs a lot because he’s one of the world’s richest men not the ending on how you’re calculating.
Elon Musk and Bill Gates knowledge as and.
You know but he has given back a ton he speaks a lot at on true events and all his kind of thing so and he’s invested in a ton of startups as well which is which is interesting so.

Jason:
[20:58] Including like Google by the way.

Scot:
[21:01] Yeah a little a couple Stanford guys had the certain invested in.
But then what’s interesting he’s kind of goes and tries to make a does the math on the the annual impact and uses the last year 2020 as the.
The time frame and it goes through and I won’t bore you with this but it’s really interesting kind of talks about.
Yeah you know shareholders made effectively 21 billion employees 91 third-party sellers profited to the tune of 25 billion by calculation,
and then one thing he does that’s near and dear to my heart is he does this customer calculation and it’s really interesting uses kind of the the proxy for how much time they saved in aggregate shopping on Amazon.

[21:48] I spend almost all day talking about you know our.
Ja bitte my company does is saving people time on car care so it’s kind of interesting to see him walk that Math and how he approached it and he sums all that up and he comes to kind of 300 billion dollars was kind of the.
D some tangible some intangible value that that Amazon created in aggregate which is pretty interesting.
Then we live in such a skeptical time.
At the first pass I read that I was kind of like reading it and as like this kind of lesson foreigners and the second time I was like how much is he defending himself from Monopoly and that kind of stuff and there’s definitely Parts the letter that are a hundred percent offense against that but this one,
it felt like it came more from the heart I kind of landed on.

[22:34] The second lesson he talked about and I feel comfortable with a podcast host who calls himself retailgeek that you’re going to be squarely and on this one,
he talks about differentiation as survival and the universe wants you to be typical so you know this was a really interesting lesson of,
being different is okay and it’s good and it actually is is a way to survive and do better than the average by definition,
and then a little quote here we all know that distinctiveness originality is valuable we are all taught to quote unquote be yourself.
I’m really asking you to do is Embrace and be realistic about how much energy it takes to maintain that distinctiveness the world wants you to be typical in a thousand ways it pulls you at you to be typical don’t let that happen.
So I thought that was kind of interesting of you know the things he picks a talked about and you tell he puts a lot of thought into these topics I just thought those were two interesting ones.

[23:33] And then on the new side so that was some option or founder stuff I found kind of interesting and helpful.
And then the other bucket was some new stood that’s and I talked about the 25 billion dollars from third-party sellers that was kind of a new disclosure if you will,
but for the first time he effectively says that there’s over 200 million Prime members globally so that was interesting because there’s been some wide-ranging I think I’ve seen the range I would put on this.
A lot of Wall Street guys were kind of like in the 180-190 range so they’re kind of close to 200 but then there’s always that one that’s like wildly high and I think it’s it’s kind of up into the high 200s like 280 290.

[24:17] But in classic basil system he says over 200 million so.
We definitely know the 180-190 is wrong but 280 probably is Wrong Feels like the way it was as close as almost as if they had just crossed over but he doesn’t explicitly say that so you can’t count on.
That was a big disclosure that had a lot of people on the interwebs talking today they also disclosed when he was going through that math of the impact,
he had to have a number two x he kind of does the / seller impact and they had to have a number to multiply and he said greater than one point nine million
I kind of thought I remember this being disclosed as one and happens I wasn’t so surprised by that one and then another little tidbit is that they have over a hundred million smart devices that are connected to Alexa,
so that was a new disclosure as well so so those were my takeaways Jason what what did you enjoy from the letter.

Jason:
[25:12] Yeah I would Echo all everything you you pointed out he like one of the things that hit home for me he talked about like,
you know everyone will give you advice to be yourself and the fairytale version of that is that just you know when you act like yourself everything will be great and easy and he’s like the reality is,
I like being different than the norm takes a huge amount of effort to end you know challenge to maintain and that that you know that,
you know part of the deals you have to keep putting that effort in it’s not easy and that’s that’s why you know people tend to regress to normalness.

[25:47] Which I like it’s obvious when he says it but I thought you know it was it was an interesting point and he whether it’s him or the massive team that writes this letter for him he’s super articulate I tend to believe it’s mostly him.
You know there’s some great metaphors and points in their the I took away the the same three big bullets you did 200 Prime member 200 million Prime members 1.9 million sellers,
and the hundred million devices and I would say a to me it is interesting it means that the the,
the estimators are really good right like a lot of people had them at 190 to 200 million Prime members so that was great,
Marketplace pulse adamant 1.5 million sellers so you know 1.9 was great and I kind of think the hundred million is a little bit of a throwaway number because,
you know we’re all curious how many Alexa’s are out there which he did not disclose and he said a hundred million smart devices are attached to Alexa but the.
The ratio is highly variable I have 82 smart devices in my house connected to Alexa.

[26:51] So like I know I know that I’m an outlier but I’m just saying like you start throwing a bunch of light bulbs and switches and stuff on there and it’s you know.

[27:02] Kind of a meaningless number but I thought all those things were good takeaways the the math on the,
Time Savings was awesome to me a fact he disclosed that was not public was that almost 30% of all Amazon transactions happen in under three minutes,
so total shopping time for twenty-eight percent of transactions is under 3 minutes and you know by comparison and average brick-and-mortar trip is 60 minutes so.
Huge huge Time Savings I you know he kind of did a more sophisticated model and came up with like the average customer Amazon Customer saves,
75 hours a year of shopping by shopping online and it’s a great argument for Amazon but it’s also just.
I got involved in a dispute online on LinkedIn recently about like what the definition of.
Customer services and customer satisfaction and everyone’s like well you know people in a retail store can always give better customer service than a robot online,
and I kind of took the argument well no that’s not true if customers decide that good customer service is fast easy shopping.

[28:15] Then Amazon gives better customer service then then Amazon then Nordstrom’s and like the customer SATs show stores kind of show that,
and it makes perfect sense when you think about three minutes versus 60 minutes for a shopping trip so I just thought all that stuff is super interesting,
and then the other thing is you know he’s not going away he’s still chairman,
you know curious what his Focus was going to be on and kind of the two things he talked about we’re number one that he thinks of himself first and foremost is an inventor he thinks that’s where he adds the most value at Amazon so that like on a go-forward basis he wants to invent stuff.
And the stuff he claims he’s going to focus on which is probably true but also has a kind of,
you know good good PR element to it is is he made a specific emphasis on adding a new goal for Amazon Amazon’s goal has always been to be the most the world’s most customer-centricity company,
and he’s added this new goal to be the world’s best in and safest employer and so his.
His promise in the shareholders letter is to you know help invent new,
products and processes to make Amazon the best employer in the in the world and the in the safest and so super.

Scot:
[29:33] Yeah I’m eating I’m skeptical but it made its just right after the heels of that whole being and Jardin trucks thing and it just felt too.

Jason:
[29:41] No party like clearly it.

Scot:
[29:41] Last minute addition to talk about that.

Jason:
[29:43] It’s in response to that and he vote overtly took on the you know they they massively won the super controversial union vote,
um
and and he kind of took that on he’s like in case you’re curious I’m not happy about the white Amazon one like they you know a bunch of people word really hard to Amazon to make sure that a union didn’t get formed and and the voters you know the employees,
why overwhelmingly voted against forming a union and you know Jeff which is the right spin regardless of how you feel Jeff you know in the shareholder meeting he’s like hey.
Nobody celebrating nobody’s happy that a union didn’t form like we clearly need to be do a better job with our employee like you know our employees and so here’s my go forward Focus so I think it’s a it’s a smart Spin and,
I do think you know just not going to write something in the shareholder letter that he doesn’t plan on delivering on so whether it’s it’s coming from.
A kick a place of convenience or altruism kind of doesn’t matter I’ll bet you I’ll bet you they spend some real Cycles,
figuring things out to improve the the allegedly already hide custom employee satisfaction and and for sure to overtly improve safety.

Scot:
[31:00] Yet the one last thing on that math that was interesting is he does all that math of how much an average trip to a store cost everything,
and effectively and then he nuts out Prime cost and basically the calculus is by being a Prime member you save $630 just of your time,
and he builds everyone’s time at ten dollars an hour so that was I thought that was really you know.
There’s all these stories about when Prime was being invented that he is driving,
measure of it was it should be fiscally irresponsible not to be in Prime,
and this makes now and a lot of that was just the the savings of products and those kind of the convenience just overall convenience and this is kind of interesting that he’s put some hard dollar against out.
You’re effectively throwing away six hundred dollars if you don’t join Prime now there’s obviously a counter,
argument to that and everything but I thought it was really interesting how he framed that.

Jason:
[31:58] Yeah no I agree so a ton of good stuff in the shareholder letter I saw people on the internet like alleging it was his best one ever and I still think the first one is the best but.

Scot:
[32:08] It’s good looking so there’s a good good beginning and ending okay well you can put your hanky away hopefully if you’re okay over there.
Um
One news that caught my item in this is kind of related to this we’ve been talking this year a lot about watching Shopify versus Amazon,
and then we did that very popular show about the changing privacy things coming out,
and one of the possible conclusions of that is Shopify could be under some some pressure from that.
And it was through interesting an article came out that about half the senior Executives at Shopify are leaving it’s hard to tell what’s going on here Toby had a really weird statement let me read it didn’t make sense to me did you read it.

Jason:
[32:54] I’m not sure which I didn’t catch one that sounded.

Scot:
[33:05] So he did the normal they’ve been spectacular and deserve the cabal then he this is the part that kind of had me a little befuddled each of them has their individual reasons but was unanimous with all three,
was it this was the best for them and the best for Shopify and then he says we have a deep bench and they will be they will step in to quickly fill these roles so I don’t know.
The weird thing,
I don’t know that it was unanimous that it was best for Shopify and it’s kind of it’s almost like there was some kind of a power player something or I don’t know I got like a weird vibe off of it.

Jason:
[33:42] Yeah you almost would,
the conspiracy theorist in me like so this is three sea level people leaving a public company at the same time and by the way a fourth one left three months ago right so
it’s four of the eight,
and a couple of these the the chief product officer that left last November Craig Miller and then the the chief Talent officer that left this week like those were,
like amongst the 21st employees and I kind of think Anna,
a giant fast running public company you tell me but
in normal succession planning like even if a bunch of people want to go you know cash in their chips and live on a beach you would stagger out the departures more right if in a.
In a kind of if you were working things out synergistically so for all these people to leave at once,
it feels like there had to be some impetus that that were not fully cognizant of.

Scot:
[34:50] Yeah one of the thing I’ve externally observed is,
they have a guy Harley is it Finkelstein and Finkel something like that we’ll call him Harley up,
and he was kind of you know a partnership guy and then he seems to becoming the face of the company and maybe I kind of wonder if there was you know some secession thing in there and he’s been some kind of he’s kind of been
he kind of won that battle there feels like something went on there the other thing I’ve noticed is there their social accounts they’ve gotten really super snarky so shop if I used to kind of I think,
be in this kind of what I would call this Canadian like you know we just want to help arm the rebels and grow customers and like most their social stuff was about
just kind of pounding that drama of you know look we took this,
this entrepreneur and we help them do this and they have a lot of good content around that but increasingly they’re Throwing Shade at Amazon which you know,
that’s punching up but then I’ve noticed they’ve actually been kind of I would say punch down there was a retailer who site was down and it was and they were on Commerce and you know the Shopify socials kind of
added them added that retailer and said hey sorry to hear you’re having so much trouble with your current provider we’re here to help and that that one kind of felt like.
Punching down and little little on the edge for what they’re doing so something something interesting is going on inside of there.

Jason:
[36:17] Yeah it is a Jeff would be very happy because it’s a not normal culture.

Scot:
[36:24] Yes.

Jason:
[36:25] The yeah I will say for better worse like,
these three three folks announce that they’re leaving add in the fourth one last quarter and the stock still went up so,
so for whatever that’s worth like the market isn’t panicking the the one I hear the most about is the chief technology like if people are freaking out that someone’s leaving it’s this guy,
Jean Michael Lemieux who is the chief technology officer and he’d been in like six years and was credited for you know,
a lot of progress in the platform so people are somewhat concerned about his departure,
so we’ll see how that plays out like I think shopify’s an amazing company they do a bunch of stuff for right but I have to say a common problem for someone in shopify’s position and I think Shopify suffers from this in spades.
Because of their success and their rapid growth they have a ton of Technology debt.

[37:23] And you know there are a lot of chinks in their armor from a product standpoint like it’s not the the,
the fastest best performing most mobile friendly platform on the planet at this point and so I like I don’t know maybe the.
The change in leadership will make it easier like I know Toby is a developer and he has a personal affinity for their original stack that they’re still on which is,
Ruby on Rails but like maybe maybe a new technology officer will help them work down some of that technology debt.

Scot:
[37:57] Or made an old guy said leave her behind leaving in that was like.

Jason:
[38:00] Yeah yeah maybe that was it.

Scot:
[38:02] Peace
peace bro and one calendar thing just to throw out there is Shopify announces their q1 results on April 28 and then the next day is Amazon so we will be having a show we’ll do it after the end of the longest one I’ve definitely,
that people enjoy our Recaps there we will wrap in some of the Shopify stuff and have our ears peeled for anything around this and obviously how Shopify did versus Amazon I think it’s gonna be interesting because I think
they may throw shade at each other in their calls Amazon won’t but Shopify May so I’ll be listening for that as well did you see any news that caught your eye this.

Jason:
[38:39] Yeah there’s one more I want to bring up because I feel like it’s thematic with the other news Katrina the founder of Stitch fix has announced that she is stepping down as CEO,
moving into executive chairman role and that is interesting to me there have been a bunch of Articles you know kind of bemoaning that she’s one of the,
the the best female entrepreneurs out there and you know one of the few female CEOs of a successful public company,
and I have to be honest like all of those articles are slightly rubbing me the wrong way because whether it’s lost some people are not,
she’s one of the most successful entrepreneurs of Our Generation. Like it like there’s no gender qualifiers,
um she started a company that you know invented a new business model that’s been heavily knocked off,
she took them public but what’s unique and continue to operate them,
what’s unique about her versus almost any other CEO in this rat race is she retained the overwhelming majority of ownership of the company all the way through the IPO.
Which almost never happens.

Scot:
[39:55] Yeah her um her episode on how I built this is really good I think she ended up retain law because they had a hard time raising Capital there was so many people that doubted the model whatever work.
Um

Jason:
[40:05] And ironic in the long.

Scot:
[40:06] Part of it was wasn’t by design it was by necessity yeah yeah yeah I agree she’s awesome and did she I didn’t see that did she announce what she’s going to do I think she has young kids so it’s probably.

Jason:
[40:17] She did she did not specifically announce it she she did tease at.
Kind of what the next chapter is at Stitch fix which people are kind of excited about because Stitch fix was already a pretty heavily data-centric company and both,
but I think this is partly true but I think they also leaned into this from a PR standpoint that they collect all this,
this unique attribute data about all the items that get sold then all the items that don’t get sold and you know that they have like very data-driven personalization and the implication.
Interweaving was that like the next phase and evolution from Stitch fix is to really weaponize that data at the next level and kind of there were a few things in there that a lot of us interpreted as,
they’re going to be pivoting and making a lot more of their own stuff they already do make some there a wholesaler but they do make some of their own stuff,
um and that the stuff they make is going to be heavily data-driven merchandising design and so that’s going to be interesting to watch,
there’s this woman Elizabeth Spalding who’s currently the president I think she’s been there like 6 years and so she’s going to be the new CEO,
and like most of these Founders she’s not she’s not going away she’s she’s stepping up to a chairman role which I assume will give her more bandwidth.
Other aspirations in her life and spend some of that good Equity money she earned.

[41:47] So Scott I think we miraculously did it we are we are well under the hour so we can we can give our listeners a little time back this week
and finish with a shorter show but if we got something wrong or spurred some,
some following conversation we’d love it if you’d hit us up on Twitter or Facebook.
And as always if this was helpful now you got 20 extra minutes that’s plenty of time to jump on iTunes and click that five star review for us.

Scot:
[42:16] Thanks everyone we appreciate it and we got a lot coming up next week so hopefully some of you are going back to work and commuting or still have time because we’re going to be cranking out some content here as things heat up.

Jason:
[42:30] Absolutely and some exact guess I’m excited for her as well so until next time happy Commercing.

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