On today’s episode, Kunle is joined by Mark Hook, Vice President & Global Brand PR of Communications at Brightpearl, a Retail Operating System that’s geared towards retailers and wholesalers looking to reach hyper scalability.
Nothing is more exciting than seeing your brand receive twice the amount of orders. All those late nights have finally paid off. But as your brand continues to grow, so does the amount of workload. Things get more and more complex as you get more customers. Your old operation model can’t keep up with the massive orders you’re getting.
If you’re looking to solve these complexities, Brightpearl is your partner in hyper scaling your business. With Brightpearl, you can focus more on working on the business rather than in the business. Brightpearl automates everything after the customer clicks the buy button. With the worries and heavy workload off your shoulders, you can fully focus on growing fearlessly.
In this episode, Kunle and Mark talk about the event horizon. You will get to hear about how Brightpearl skillfully builds a brand’s fame. This is a great episode for business owners looking to automate their operations model to focus on their brand’s growth.
Here is a summary of some of the most important points made:
On today’s interview, Kunle and Mark discuss:
The eCommerce GrowthAccelerator Mastermind Facebook Group has just launched.
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This episode is brought to you by:
The 2X eCommerce Podcast Show is brought to you by Brightpearl, the number one Retail Operating System for e-commerce, multichannel retail brands and wholesalers who want to Grow Fearlessly.
Lightning 50: Does your fast-growing online retail business stand out from the pack?
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In this episode, you’re going to find out how to enter Lightning 50, which is an exclusive league table of the fastest-growing eCommerce brands. It’s a great episode you do not want to miss.
Welcome to the 2X eCommerce Podcast. The 2X eCommerce Podcast is dedicated to digital commerce insights for retail and eCommerce teams. Each week on this podcast, we interview either a commerce expert, a founder of a digitally native consumer brand, or a representative of a best-in-class commerce SaaS product. They all have a tight remit to give you ideas that you can test right away on your brand so you can improve commerce growth metrics such as conversion, average order value, repeat customers, your audience size, and ultimately, your Gross Merchant Value, or sales. We’re here to help you sell more sustainably.
This episode is a bonus episode. This is an interview I had with Mark Hook, the Vice President of PR at Brightpearl. If you don’t know Brightpearl, it’s an ERP or operational technology solution for your back end. It’s everything back-end-related. Whether it’s warehousing, order processing, or demand forecasting, Brightpearl is that backbone, it’s that ERP system, which is built for eCommerce and retail.
This episode will give you a backstory of what they’re doing. Lightning 50 is a ranking of the top commerce companies in the UK and the US by revenue growth. It is a fantastic way for you to get exposure. What they do is they also get PR for the top 5 or 10 top charters. I’m going to interview the top five companies on this list at some point when the results are out.
They started in 2021. It was their first edition and it was exclusively in the UK. It was phenomenal. They got lots of insights off the back of it. The new vodka brand won in terms of growth. It’s an interesting way to dissect what growth means and how brands are going about growth. We discuss that particular brand in this interview. It’s fairly easy for you to enter this competition. It’s open to all commerce brands. Go to Brightpearl.com/lightning-50. It’s fairly simple.
If you know that you have seen exceptional growth over the last twelve months, it’s worth an entry for the exposure. They would put you into loads of podcast interviews or get you to press because you’re part of the exclusive list. They’re going to have two lists, one exclusively for the US and another for the UK.
It’s a great interview. We talk about their perspective on all that has transpired, supply chain issues, the war in Ukraine, rising demand, and how all of that is bubbling up for his projections for 2022. I’ve been listening to some other podcasts and reading some reports which say that inflation has died down a little bit. It’s an interesting conversation I had with Mark. Mark has some unique insights from that perspective.
Before I let you go, do us a small favor. Wherever you follow this podcast, whether it’s YouTube, Spotify, Apple, or whatever, hit that subscribe button. That will help the show reach a lot more people. If this show has added value to you at some point, maybe this episode or prior episode, hit that subscribe button and support us with a click or a tap. I will let you go and enjoy this episode. Mark is knowledgeable and an expert in commerce. He’s privy to a lot of data from companies that Brightpearl serves. Enjoy this episode. I’ll catch you on the other side. Cheers.
Mark, welcome to the 2X eCommerce Podcast. It’s a pleasure to have you on.
Hi, Kunle. I’m excited to be here. Thank you for having me.
You’re Vice President, Global Brand, PR and Communications at Brightpearl. Do you want to give a brief introduction about what you do at Brightpearl and Brightpearl?
Yes, I can. It might take all day if I try to cover all the bases. In a nutshell, I help make brands famous. My role at Brightpearl is essentially the management of all the external comms, the PR, and brand positioning, identity, look and feel for the product. Enough about me, Brightpearl itself is an innovative product. We call it a retail operating system for retailers and wholesalers. What does that mean? Let me break it down for your audience.
This is the 2X eCommerce Podcast. Most of the audience is focused on growth as they should be. The problem with growth is that it introduces massive amounts of complexity to your business. As you grow, as you get more orders, as you’re adding more GEOS, as you’re adding more channels, what you’re going to find is that it becomes increasingly hard to manage. You may start to see mistakes entering the business, late deliveries, missed picks, doc outs, and data not being accurate across the business. That’s a massive problem and it’s one that continues to slow businesses down. It’s been proven that it can stall businesses out.
You get to a point in your growth as an eCommerce business where you can’t step any further without doing 1 or 2 things, either investing in people to manage the orders, put things into spreadsheets, or invest in systems. I’m on the tech side so I’m going to say invest in systems. For us, that is the way that eCommerce merchants can get back to focus on growth. Once you get to a point, a lot of our customers find that they are working in the business rather than on the business. They want to be focused on growth.
In the nutshell, Brightpearl automates all the workflows, whether that’s orders, inventory, sales order management, purchasing, supplier management, CRM, logistics, warehouse, and the whole shebang. We automate almost everything after the buy button. What that allows brands to do is to return to growth and grow fearlessly. A bit of a long-winded way but I felt the added explanation might be helpful.
I was going to pigeonhole you into operations, an operational platform. You guys refer to yourselves as a retail operating system. When you mentioned CRM, retail, accounting, and flexible infrastructure, it’s a lot more than operations. It’s a lot more than what happens in the warehouse, order management, or inventory management. You extend beyond that. How do you sit with ESPs or CDPs from a CRM standpoint? I’m curious to know what your CRM looks like.
We like to think that we do everything after the buy button. Our key strengths or focus is more in line with automation and as an order management system as well. Our automation is our bread and butter, our demand forecasting tool. These are the things that we do exceptionally well. We do everything else. You can use Brightpearl as a way to manage your financials. We have Brightpearl Accounting. The thing about Brightpearl and where the space is going is that retailers want the option to use a composable tech stack, systems working well together.
For us, Brightpearl works exceptionally well. It plugs and plays into almost all the key tech partners in that retail space that we’re talking about, CRM. Klaviyo, who sponsors this podcast, a lot of customers will use that to take their CRM or email marketing to the next level. When it comes to financials, a lot of customers use Brightpearl. They also have the ability to use any other financial partner they want to use. We don’t limit growth. If they want to use Xero, QuickBooks, or Sage Intacct, they can do that. Hopefully, that answers your question.
It brings me to my other question that has to do with the retailers. When do you think a retailer would be primed to say, “We’re fed up with delivering this terrible customer experience due to human error. We want to deploy the machine. We want to automate by ourselves.” Would they be running a 3PL? Would they have their own warehouse? What retailers or eCommerce brands lend themselves well to using or needing Brightpearl?
Our Senior Vice President of Product, Scott, always summarizes it well. He says that, often, there’s an event horizon. There are lots of challenges and issues along the way. I’m sure a lot of your audience will resonate with this but many brands will continue to use spreadsheets and continue to try to manage the business without technology for as long as they can. I don’t know why but they do.
A lot of our customer base, a lot of retailers, in general, are not just using Brightpearl but any type of back-end software. To an event horizon where something’s happened, they say, “This is it.” It’s either they find that they are spending so much time, so many hours reporting, doing the orders at the end of the day and it gets too much, or there’s a mistake, something’s happened.
The customers are complaining. They’re putting bad reviews on Trustpilot. They’ve had a bad season or it’s something to do with reporting. Whatever it is, it’s often a mixture of things. It’s the point where the pain of operational complexity has got to the point where it’s not only slowed growth but is actively making your business worse at this point. There is too much pain now. We all get to that point. Change is hard sometimes.
I like that term, event horizon. It’s a nice way to look at things. At the end of the day, for customer-centric eCommerce brands or retailers, we’re doing this for customers to deliver a better customer experience with incremental improvements over and over again. How do you view customer experience and its impact on growth, especially from the point of you serving many merchants? Is there a direct correlation with the ability to deliver superior customer experience and then hypergrowth?
There is. There was a study we did with Trustpilot. You can find it on Brightpearl.com. We did 50,000 one-star reviews for eCommerce brands. 75% to 80% of one-star reviews were related to operational problems. It’s something that happened after the buy button. That was delivery returns related mostly. All of that was operations at the end of the day. Something had gone wrong with the operations of the business where they weren’t able to serve the value to customers that they would like to. That’s where technology comes back.
We have a customer called Goose & Gander. For them, their event horizon was they had a Black Friday, Cyber Monday, and the Christmas season. Their order spiked so much that everything broke. There were 6 to 8 weeks delays for customers to get their items. For them, that was their event horizon. They got tons of negative reviews. Those customers aren’t coming back.
For them, that was like, “We need to fix our operations now. We can’t just focus on customer acquisition but we need to fix our operations because that is the way we serve value to customers and also retain customers to get them to repeat buying.” That’s what value is. What you need to do as an eCommerce brand is to not just sell a product to one person once, but you need to make sure that you’re getting those repeat buyers. The only way you get repeat buyers is by stellar service. The only way you get stellar service is by making sure your operations are tip-top.
This is a left-field question. In terms of fulfillment like 3PLs, what’s your take on 3PLs versus handling your deliveries in your own warehouse?
Honestly, it depends on the business and where they get to in terms of the number of orders you’re experiencing each day. For me, I come from that tech background of automating everything you can as an eCommerce business. 3PLs take a lot of strain away. That hassle of pick packing and getting the item out the door is done for you. Like everything, that type of technology needs to be factored into your business at the right time.
A lot of Brightpearl customers use 3PLs to effectively manage a business but they have incorporated it into their tech stack at the right time. It’s understanding what order level is the right technology to introduce. Much like a back-office solution, you wouldn’t necessarily introduce a back-office solution into your business if you’re doing 50 orders a day. Once you start going above that, let’s say 100 orders a day, managing that manually becomes impossible. Once you start spiking and you’re doing 5,000, 10,000, 20,000, forget about it.
What’s your take on consumer behavior and mapping it out to changing channels? You can now shop on TikTok. If you’re in the US, you can shop on Instagram directly from several merchants. There are pop-up shops coming all around. The retail distribution is still strong. There is increased complexity for brands that want to break that $50 million or $100 million in GMV. There is increased complexity and more channels at play. What is your take on how consumers are shopping, particularly post the top of the pandemic?
There are more channels than ever before. The term multi-channel is more prevalent than it has ever been, it’s probably more current than it’s ever been. We did a study that looked into channel adoption by age cohort. What we found is interesting. More than ever, the way that consumers want to buy is massively changing by age.
We’re looking at the youngest cohort. We found that Gen Z wants to shop by TikTok, Instagram, to an extent, voice commerce, and live stream. The Millennials want to use more established social media platforms like Facebook and Instagram. They’re keen on Etsy, marketplaces, and some of the new pop marketplaces that are coming up. Boomers are completely different. It’s more retail. It’s more website-focused than it is a marketplace.
Coming back to your point, as a brand, it’s essential nowadays that you have a handle on your customer data. You’re doing your analytics. You’re understanding not only where your shoppers are buying today, what channels they’re using, what channels they want to use, but where they’re going in the future. Also, being able to stay abreast of all of those trends.
Interestingly, what we found with that Millennial and Gen Z example is that a lot of retailers were not set up on those channels. You mentioned Instagram. 30% of online retailers have the ability or are currently selling for Instagram according to our data. That’s wild. The same with TikTok, 11% we’re interested in even adopting that as a channel. If your primary audience is young consumers and you’re not selling on those channels, something’s not quite right.
The other issue with channel adoption is how you manage it and that was where the rubber hit the road. In many cases, brands are scared. I’m talking for everyone here. The research says that 70% to 75% of brands don’t adopt new channels because of the hassle and stress that can bring. Technology means that it shouldn’t be the case.
We’re in an era of hyper scalability where you need to be able as a brand to set up a TikTok channel, an Instagram channel, an Etsy channel, and Shopify storefronts if you want to do so and swap those out when you need to. What is hot for one season, let’s say TikTok was hot in 2021, might not be a hot buying channel in a year or two. It needs to be able to flex and change with that. Technology is there to do it but you have to use the right agile, flexible systems that allow and support you to go, “We need a Shopify store. Let’s get that done in twenty minutes.”
SaaS eCommerce platforms such as Shopify have changed the game, particularly going to market. It’s phenomenal what you could do with Shopify and how quickly you can market. They even have a POS. This brings me to some of your work. In 2021, you had a top 50 fastest growing retail list called Lightning 50, which is why we’re speaking now.
This is the pandemic mania at that point. We’re all shopping online. Do you want to give us how you guys came up with the idea of this list and what your findings were from a retail standpoint, from a top-performing retailer standpoint? What did you see and why did you do it? Let’s start with the why first.
The why is important. During the pandemic, shopping online was our only escape in many respects as sad as it was. We felt that other online retailers probably didn’t get the respect and credit they deserve to. It’s allowing us a form of escape but also holding up the economy at the time. We looked around and there was nothing out there that celebrated those online estimates.
We wanted to bring about a ranking, Lightning 50, that was purely based on growth, purely based on who was the fastest growing online retailer out there in Britain. It was Britain. In 2022, we’re doing the UK and the US. It’s open for 2022. We wanted to do it as a way to recognize and celebrate online brands who have been through it themselves. On the Lightning 50 list alone, the average growth rate was 500%. You can see how many late nights some of these brands probably had.
Were these brands startup brands? Were these established brands accelerating due to the environmental changes that happened? We couldn’t shop in retail. How did you pre-select the brands that entered the competition? What were the criteria?
The criteria is two full years of revenue growth. It was open to brands anywhere from $1 million to $250 million in terms of revenue. You had to have two years of full revenue growth. You could be a startup-ish brand but you could also be an established brand. We have plenty of established companies that put themselves in and plenty of luxury heritage brands like Holland Cooper and Fairfax & Favor. We had some hot D2C brands like Candy Kittens and Biscuiteers, lots of companies that your audience has heard of.
I love Candy Kittens.
I love Biscuiteers. That’s the why.
What patterns did you pick from the top 90th percentile of this cohort? What made a brand tick? Did you spot any patterns?
We did. We saw that a lot of the brands were based on fashion. The other thing that was interesting was almost 18% were based in the southwest, which you wouldn’t necessarily think of as a hotbed for eCommerce. Almost 20% came from the southwest. In terms of some of the environmental factors, a lot of it was based on the pandemic. That type of thing was huge for them. We found the top tech that was powering the fastest-growing brands, Shopify, and Shopify Plus. Many of the big growers had re-platformed.
Facebook and Instagram, those paid advertising companies had invested in those areas. They invested in analytics and workspaces. The demand forecasting is huge. Inventory Planner came out as a demand forecasting tool that almost 25% of the brands on that list used to support growth. This is circling back to some of the discussion points we had earlier but a big factor of growth was the adoption of marketplaces, Etsy, eBay, and Amazon being those key areas. Also, the free tools that were mentioned as well were Trustpilot, Pimberly, Klaviyo, and Brightpearl are in the top ten by the way.
I picked up on two things, demand forecasting is essential with the supply chain constraints in 2021. It’s still wreaking havoc this 2022. The second thing I picked up there was the multi-channel. They were not like, “We’re only D2C. We’re a maximalist. We’re a marketplace brand.” They want to be where their customers are. Who topped the rankings in 2021?
It was this premium vodka brand called Au Vodka. There’s an incredible story behind those guys. They came from nowhere to be an absolute smash hit online. They work with some big stars like Floyd Mayweather and Stormzy. They’ve invested in influencer marketing. We had them on the Brightpearl podcast and they said that influencer marketing was key for them to get them to that growth rate that they had.
How long have they been operating for this company?
I don’t know off the top of my head. They’ve been around since 2017. They saw exceptional growth over the past couple of years.
I’m on their Instagram. They’re gold. It’s bling. You can’t get any more bling than this. It works because they then insulate it with grind culture, with subcultures that celebrate bling. There’s this affinity there with the product and influencers. It’s super interesting.
They work with a grime artist. The name escapes me now. They have gone down a route of being in your face, garish, bling. They know their audience incredibly well. They know what their audience wants. If you look at their vodka bottle, their packaging, and their visual identity in a shop, it stands out against some of the well-known vodka brands on the market. They know that their audience wants that. Their audience wants to stand out. They want to be seen. They’ve done incredibly well based on that.
They’re an omnichannel brand in the sense that they not only sell online but they have to be in clubs and establishments. They have to be offline, maybe in supermarkets. At the time, were they selling multi-channel, or were they selling exclusively D2C online?
They weren’t exclusively D2C. They had limited retail stockists. Since the 2021’s list, that has also exploded.
They’re setting a lifestyle from what this looks like. Do any other brands pop up to your attention as a marketer, PR, and the like?
For me, Biscuiteers was another interesting brand and what they were doing, luxury biscuits selling online. That space and how they’ve made that work is incredibly interesting to me. Candy Kittens, we’ve touched upon. Holland Cooper is a Brightpearl customer. They sell luxury heritage tweeds. It’s a heritage lifestyle in respect. They are interesting in terms of how they use social media and Instagram. They’re selling a lifestyle as well, much like Au Vodka.
The point of this is all these brands know their customers. They’ve done the hard work. They’ve done the research to know what their customers are thinking and what they want. They listen to reviews. They flex their business accordingly. Almost exclusively every brand in that 10, 20, or 30 of the Lightning 50 had a firm understanding of their customers and how to reach them.
They’re worthy of study, for sure. If you guys can introduce us to a few of their founders or their marketing teams, we would love to have them on the podcast.
I can introduce you to them, for sure.
It’s on BrightPearl.com/lightning-50. How do you enter? What are the criteria? When do entries close?
Entries close on August 12th, 2022. In terms of the criteria, it’s free to enter. It takes a couple of minutes to do via Brightpearl.com. You need two full years of revenue. Everything else is relatively self-explanatory there. It’s a list that is based on growth. The thing we’ll ask you is, “Give us your revenue growth over the last two years. What are the factors that have powered your growth?” That’s pretty much about it. It’s simple to enter.
It’s not necessarily your total GMV or sales. It’s more your growth rates in the last two years.
You’re also open to the USA. It’s going to be the UK and the US merchants essentially.
We’ll have two separate lists. It won’t be a combined total. We’ll have a UK list. We’ll also have a US list as well.
I’m keen to see the results this time. When will the results be out if the entries close by August 12th of 2022?
We expect to reveal the list in September 2022 time. It’ll probably be at the end of September, maybe at the start of October. We’re aiming for the end of September.
We should have a chat in September when it’s out, for sure.
I’ll send you a preview of the list so you can pick some brands if you want to speak to them.
I’m looking forward to it. For those of you reading, if you want to showcase your growth, Brightpearl has it. It’s Lightning 50. You could google it or go to BrightPearl.com/lightning-50. It’s easy to apply. There are about fourteen fields on here, straightforward questions. Enter. Before I let you go, Mark, Q1 is behind us. Q1 has passed like that. We’re recording this on the 25th of March 2022. With many things happening, we’re still talking about supply chain issues, although they’re starting to ease off. Shipping costs are still high. There is inflation. How do you see this affecting consumer behavior? How do you think best-in-class eCommerce brands can swim against this current?
It’s an interesting and a huge topic that could probably be another twenty-minute conversation itself. The supply chain issues will continue to have a major impact. The consumers don’t care. They’re going to be annoyed. They want to make sure that they can order online. What is increasingly happening and what retailers need to be careful about is we’re seeing a big increase in the number of stockouts after purchase.
Hopefully, we’re going to be doing a study soon into this. When you order a product and then get that dreaded email that says, “Sorry, it’s out of stock.” It’s frustrating. That’s increasing. That is what consumers care about. If the product is on the website, they put it in their cart, and they bought it, the worst thing you could do is tell them that it’s out of stock. The supply chain issues will almost certainly frame the remainder of 2022 and into 2023 as being one of the primary concerns of multichannel retailers.
We touched upon it earlier but one of the solutions to that problem is demand forecasting and being able to get a handle on your inventory management and your cashflow and understanding the relationship between those two things. I’m advocating for tech but use any tactic that can help you take the cost, the complexity out of your supply chain. Understand the forecast ahead of buying what you need when you need it. You don’t want to be in a position where you’re buying too much stuff or not enough stuff and you’re having problems with stockouts. That is the one key area retailers need to focus on for 2023.
Mark, it’s been an absolute pleasure having you on the 2X eCommerce Podcast show. Thank you.
It’s been a great chat. Thank you so much.