Interview with Uberall VP Greg Sterling on Local Acquisition and Marketing for Retail Stores
In this Interview Darius spoke with Uberall VP of market insights Greg Sterling on Local Acquisition and Marketing for Retail Stores
Welcome to the retail tech podcast. My name is Darius Vasefi. The host and producer of the show and this interview is on clubhouse being recorded and will be published on retail tech podcast.com. Today, I am speaking with Greg Sterling from a company called Uber all overall, I think, hope I said that correctly. And we are going to talk about local. I think that's a very interesting topic, especially for retail. So we're welcome, Greg. Great to be here. Thanks for having me. Nice to meet you. So yeah, let's let's start with just a brief maybe a brief personal intro of on what you do and how you got to work with overall and then we can start to talk about the business.
Greg Sterling 0:58
Sure. So my official title is VP of market insights for overall, but I do a lot of things. I speak externally, I advise groups internally, I coordinate research, I manage the content team. So I do I do a bunch of things for them. I joined in September of 2019. And that was a few months after I had left the local search Association, which is where I've been for four years as the VP of strategy. But overall, just real quickly, we can get into this in more detail, if you want is a it's kind of hard this is it's funny, we have a lot of conversations internally about how to characterize what we do. And the local space has been for the last 20 years or so, which is how long I've been involved in it kind of difficult to define segment because it involves both enterprises and small businesses and involves, you know, near me now, and sort of future business engagement, which may not be anywhere near where you are like a travel or something. So it's this very expansive and elusive segment, but overall, is what you might call it, we're sort of in the local marketing solutions space, that's a space. And we're talking about ourselves as a local customers experience platform. near me, customer experience platform is kind of our proprietary messaging around that right now, which may change. But let me stop there and let you kind of direct anywhere you want me to go.
Alright, so I guess to understand local retail, one has to go back and take a look at probably the history of what how it's evolved over the last maybe 10 years. With you know, Google really becoming a lot stronger and other types of like search capabilities and discovery capabilities. How do you how do you see that evolution? Especially like, from when you were at local search search Association, to today? How have things changed?
Greg Sterling 3:19
Well, I was at the local search Association from 2014 to 2019. So not not, not that long, about five years, things have obviously dramatically changed. And obviously, the pandemic has changed consumer behavior quite a bit. In the beginning, retail was only a physical operation, local stores, you know, physical stores that you had to go to, and you buy things and you return things to them. There was no ecommerce, but e commerce has dramatically grown. And now it's, you know, branched off into social commerce and live commerce. And there's a lot of things really interesting things going on around around retail, you know, in stores have have kind of hit a bit of a crisis moment for themselves, which we can talk about in a little bit. But, you know, I don't have a timeline in front of me, but but let's just say, you know, in the last decade, ecommerce has really taken off. And it has grown steadily and incrementally until really, the last couple of years, and especially in the over the last, you know, 16 months during the pandemic, where people were buying virtually everything online because they had to, and they were buying new categories of things online, and there were new shoppers online that never believe it or not bought things you know, on the internet before so we've had have a massive expansion of the e commerce population and the kinds of things that people are buying online, things that they would never would have considered buying online before now they're buying online furniture, all kinds of big ticket items. So you know that The user experience if I can use that term broadly kind of defined cheaply by Amazon. But certainly a lot of the marketplaces and many vertical sites, there's a lot of different contributors here, with the user experience has gotten better and better. Just the combination of products, product images, and reviews and product descriptions. And sort of removing checkout friction, there's been a lot of growth and change over the past decade that has made the online shopping experience much better than it was. Certainly mobile has factored into that, you know, now I think about well, the majority of retail traffic is now on smartphones. But but I think it's something like 40%, or 40, plus percent of the United States of actual purchases are happening on smartphones. And it's different in different countries, it was always the case that you would have a lot more traffic on mobile, and then the purchases would happen on the PC, but that it's catching up. Because these user experience improvements have happened. And it's easier to check out and payment, you know, payment products have improved, and so on and so forth. So we're at a point now where ecommerce has been, you know, is now I forget what the latest numbers are, you know, seven 750 plus billion in the US, it's, it's a, it's a massive, you know, it's massive, but it's still small, smaller than physical retail. And that's true globally. So what we've what we've got, you know, in the past, what we had was a bifurcation or, or separation of physical retail, and online retail, and they had separate pnls. And they were treated almost as completely separate entities within a lot of these large retailers, different divisions. They were siloed, people didn't talk to each other. Now, you're seeing more integration out of necessity, because the consumer doesn't distinguish between online shopping and offline shopping in the same way that they used to, you know, it's people do both. And very often, they'll start in one place, and then the transaction happens someplace else. I can keep talking, but I don't want to do a soliloquy.
No, no, that's fine. So the I guess one question I have is that do you? Do you foresee? Or I guess, maybe more like, if the question is When do you think that local commerce is going to be more than 50%? online?
Greg Sterling 7:47
Well, when we say local, I mean, I'm lumping I'm lumping all of physical retail into that into that category. There's really three categories. There's pure e commerce, where something is shipped to you. There's, there's, you know, in store transactions, and then there's the the hybrid, which is buy online, pick up in store or click and collect. And that has elements of both in it. I don't think we're going to ever see more than 50% of retail transactions happen online. I don't think we're going to see that unless we have some, you know,
another pandemic that
Greg Sterling 8:23
requires people to stay in their caves all day. But I think it could get it could get, it could get very close. I mean, in the UK, it's like, above 30%. But I think it's still it's still in the US, you know, depends on how you calculate it. But it's still hovering around 20% here, which was a massive jump from where it was two years ago.
So what why I'm interested to I guess, maybe think about the why, why do you think that it'll never go over 50%?
Greg Sterling 8:54
Well, because, you know, many of the people who listen to podcasts like this may be sort of different than, quote unquote, ordinary people, you know, people that are very technology oriented, very, very sort of early adopters. There are things about shopping that people fundamentally, like the physical shopping, seeing clothing, trying things on sitting in the chair, looking at the product, getting questions answered that maybe they couldn't get answered online. So there's some some they'll that are important. Now, that's not to say that people don't go into stores as they do with major appliances, and then why to buy something online after they've identified it. We're going to see a lot of that kind of, you know, cross channel behavior, but I don't think we're going to see I mean, certainly in some categories, certain commodity categories, it could well be that we get, you know, well about 50%. Ultimately, where you you, you know the product, there's no question about countering it physically, you or you bought it before. So I think I think the the different categories within retail will, will reflect different consumer behavior patterns. But, but there is a fundamental. I think people just like being in stores, I mean, what you what you saw during the pandemic, in the sort of july of 2020 is when there were some initial loosening, lessening of the restrictions, people were coming out, you know, the their homes in many places in the United States, at least, you saw ecommerce decline, that's according to Adobe analytics. So it's not that there's a zero sum relationship between e commerce and offline shopping. But people like shopping in stores, and in fact, Gen Z, is is more oriented towards stores, then millennials. So rather than continuing to see more and more online affinity, and people moving more and more away from physical shopping, that's not true with Gen Z. So the survey data reflect that they like shopping, there's a social experience there. But But, but we shouldn't see these things as zero sum or in opposition to one another. Which is, which is the popular narrative, these are really two sides of a consumer experience that most people, most people don't make these distinctions that we know analyst types are in the industry do. You know, people want to want to talk about the decline of traditional retail and the ascent of e commerce. But it's been really seen from the consumer perspective, these are two, two parallel experiences. If you have a relationship, for example, with Whole Foods, the grocery store that's owned by Amazon, sometimes you're going to buy, you're gonna buy groceries in the store, and sometimes you're going to have them delivered when it's convenient. Sometimes you're going to go out to a restaurant, sometimes you'll have food delivered, because the situation makes that much more convenient. It's really much more situational now than it was in the past where you had kind of dedicated in store shoppers and dedicated online shoppers.
Yeah, I think that's a good, that's a good way of looking at it. So I'm personally not of the opinion that ecommerce is going to be everything in the future. Now, it's my personal experience, you know, opinion, because I enjoy going to stores sometimes. Exactly. Exactly. The experience is interesting for me. Yeah. And I don't want to lose that.
Greg Sterling 12:41
I don't I don't think anybody does. I mean, I think what you want to lose is you want to lose the kind of horrific crowd experiences during the holidays, or, you know, people, the sort of, if there's one kind of concept, I think that now kind of animates a lot of the thinking about shopping, it's it's convenience, price is always in there, price is always a factor. But But convenience is now a big, much bigger deal than it was. And I think that you know, you're seeing one of the things that's most interesting to me. I don't know how international your audiences, let's assume that it's pretty International, but I'm going to use the US example. So, so target, which is a big US department store, well, I don't know their official classification, but let's call them a department store. Target has been very, very successful. During during COVID. They really ramped up e commerce. But the thing that's quite interesting is how they provided all these different options to their customers, you know, they had one day shipping one day delivery to your house, they had curbside pickup. They also had, of course, e commerce and they saw that grow dramatically. But one of the things they did with their e commerce orders is that they fulfilled the vast majority of them. I think the q4 number was something like 95%, or something above 90% of the e commerce orders were fulfilled by the stores, which which cuts down on their costs, and also cuts down on delivery time, you know, time to receive the product. So they and a number of other retailers are really using stores very strategically not simply as places where people can go and buy things, but also in support of their e commerce operation. And this is this is kind of the part of the integration that I was talking about when one quick point and then once you get in another question, so at obrah we did some research in August of last year and we among other things we asked people would you be more inclined to buy a product sight unseen online, if you if you had the option to return it to a local store. In other words, you didn't have to ship it back. You could take it back to office. Apple Store and 71% of people and this was I think 600 us respondents 71% said, Yes. So the presence of the store takes the risk out of the e commerce transaction and enables e commerce. And well, I was gonna give you another example. But I don't want to keep talking.
No, that's good. I think. So what you're talking about, I think, just just to get probably a little more technical on the terms is what we call like, Boris right by online return in store.
Greg Sterling 15:33
Yes, yes. Okay. I don't like this term focus. And Boris, Boris is a little better than Bose. I prefer the UK term click and collect because it's a little less awkward. But yes, exactly.
Okay. Yeah. Boris. Sounds Russian. No. Yeah, but
Unknown Speaker 15:48
that sounds like a real thing.
Greg Sterling 15:49
It's just, you know, it's it sounds like a, you know, some something you have removed from your forehead or something.
So, so yeah, I mean, but it is it is. So I can tell you that I actually experienced the concept at Whole Foods for the first time where I returned something that I purchase on Amazon at the whole foods, and it was awesome, because I like to go to Whole Foods to shop. And this just made it so much more convenient. It cut down one stop at, you know, UPS or, you know, FedEx store to take care of that. So. So I think there's definitely, so that dynamic is very interesting. That's probably like one of the, one of the interesting parts of retail, if we talk about the future of retail stores, is that fulfillment, and even the reverse fulfillment like returns aspect of the local store.
Greg Sterling 16:54
Yeah, exactly. And I have a, I have a similar anecdote. So the US store, Kohl's will accept Amazon returns, you don't have to package anything up, you just bring the bring the product, and you have a little QR code based on the return process online that they scan, and then you just drop it off. And that was a great experience, too. Right. So So Amazon, Amazon, interestingly, the quintessential ecommerce company, you know, the that somebody just, I don't know who it was JP Morgan, or somebody just said, Amazon is going to be bigger than Walmart by 2022, or 23. Right, just sort of moving toward becoming the biggest, you know, retailer in, in, in, in the West, certainly, they have been moving offline, in many, many ways for the last eight or nine years. I mean, they bought Whole Foods, they've got a number of stores, Amazon go Amazon, four star, they were thinking about opening a discount series of stores before the pandemic. You know, they've set up all these partners ups and coals and you know, where you can do these returns. So they they have fully embraced this omni channel concept. And, you know, they recognize that that was a fundamental vulnerability that they had this sort of delay, you know, that they've been working to, to accelerate, obviously, shipping for a long time, you know, next with one day shipping two day shipping. But But this other piece, which is the sort of convenience of of local returns, it's been something that they've been trying to solve for a long time. And they substantially have done that, which sort of narrows the gap between them traditional retailers, and traditional retailers are becoming more like them, in some respects.
So, now, we're talking about a lot of like, really large players doing being able to deliver these really interesting technologies and services to customers. What about smaller retailers on the local level? What's their future like?
Greg Sterling 19:01
So I think that that's a bit cloudier and tougher. Because, you know, consumer expectations have been set by these big players that have enormous amounts of resources and technology and infrastructure. And there was recently an article in the Wall Street Journal about the challenge that small retailers face in fulfilling their orders online, as quickly and efficiently as Amazon has, I mean, small retailers could always rely on neighborhood business or local business. And they didn't really have to have an online presence as much. I mean, some of them, some of the more progressive ones, were making sales online, but by and large, smaller retailers, you know, relied on traditional in store sales, and that all had to change in 2020. And so you saw pivots to all kinds of pivots going on and so some some companies you know, adopted social selling and all kinds of you know, use Google in in more expansive ways, certainly food ordering. And and that has to continue in most most small retailers are going to invest more in, in e commerce and digital capabilities. But they very much face logistical. I mean, put aside the supply chain issues that everybody has, they very much faced logistical challenges. And they face challenges in meeting consumer expectations. Because if you if you have these great experiences with these big box retailers and Amazon, you know it, you may rationally understand that a small retailer can't deliver the same kind of experienced, but you you, you still are not going to tolerate a lot of friction, bad customer experience. You know, it's they are they are compelled to sort of up their game. And I think, you know, Shopify is the obvious answer to your question. They have been an enormous beneficiary of COVID-19. And they are one of the primary enablers of commerce for online commerce for small businesses. So third parties like Shopify, and others are out there trying to help small businesses sort of, you know, address these problems. And there's a lot of sass companies out there. And certainly, Facebook and Google are very focused on the small business segment. Because both Facebook and Google have, you know, enormous volumes of small business customers, advertisers, I mean, most of Facebook's advertisers technically qualify small businesses. And, and so there's, there's there's many different kind of, you know, companies and developments that are sort of playing out to help small businesses enabling enabling platforms and tools. But it's, it's still very challenging, because they don't have the resources. Some of them do, but most of them don't have the time, or resources to invest that a larger company would. But at the same time, people, you know, one of the things one of the paradoxes of COVID-19, was this, this enormous triple digit growth in e commerce, and for all kinds of categories. But at the same time, you had this consumer sentiment being expressed, I want to shop locally, I want to support local businesses, you know, I'm willing to spend more to support local businesses. And it's kind of a disconnect, or it's kind of a paradox, because how can all this e commerce be happening, and at the same time, people are more focused on local and Google Search data reflect that, that focus on local to, you know, near me, search queries were constant and up. And Google has all kinds of data on, you know, the growth year over year of instock? near me, and, you know, support local businesses, there's just a ton of these queries that are all about about local that that Google says, went up by double or triple digits, you know, the the query have support local businesses and variations on that grew by 20 20,000%, according to Google, so there is this sort of schizophrenic thing going on in the market. And I think the way that local businesses, small businesses, small retailers survive and thrive is by implementing these digital tools that can, you know, narrow the gap between what they what consumers experience on the big sites and what they can what the smaller retailers can deliver. Okay, it's, it's tough. I don't want to minimize the the challenges the execution challenges.
Yeah, yeah, I mean, definitely, for smaller retailers, the challenge is much harder. So I mean, they don't have a lot of room for mistakes, either. So one wrong investment or going in the wrong direction can actually get them out of, you know, take them out of business. So
Greg Sterling 23:57
Exactly. One sort of quick final comment on that. So there's a there's a startup called nearby that's being run by a woman named April Underwood, who was at slack and Twitter and has had a lot of success in some of these big internet companies. And what they're doing is they are kind of soup to nuts, infrastructure, ecommerce infrastructure. For me, they're handling everything from kind of online promotion to fulfillment, they're actually getting products from small business customers, and shipping them on their behalf. And they're, they're just one example of a startup trying to solve some of these logistical problems for small business customers, it remains to be seen whether they succeed, but but there are a lot of people out there who emotionally would like to see small retailers and small businesses, you know, remain vital and succeed.
Okay, so that's, that's interesting is that like, nearby BY or bu y?
Greg Sterling 24:58
Well be y would be a kind of a Clever pun, but it's it's I think it's I think it's nearby with a BI.
Okay. All right. Yeah. So. So the question is, you know, you've, you've talked about the, you know, the big, huge paradigm shift in the, the article that you released. What is a paradigm shift? Is that this interaction of like really ecommerce moving more towards local or?
Greg Sterling 25:37
What Well, I mean, I think it's a version of what I said before, which is, which is this, you know, omni channel phenomenon, which is sort of an awkward term that the retail industry was talking about omni channel for, for more than 10 years. And it sort of meant different things to different people. But we're really now in this world where consumers are driving everything. And it's really about the consumer, consumer convenience, consumer. willingness to shop online or offline equally, I mean, now, before what you had is somebody who is very intentionally going to buy something online, and or very intentionally going to buy something in the store, now you have a much, much more intensive research and activity on the front end, online. So people are doing a lot more looking and price comparisons and research. And then and then some of them are going into a store and buying some buying things. But it's, it's it's the, you know, it's look at Google. So Google, Google is trying to differentiate from Amazon by including real time local inventory information, local product inventory, that's mostly from big boxes, places like big sporting goods, and and, you know, Best Buy and big retailers. And they'll they have, they have little badges that say in stock or pickup today to signal to you that it's that it's real time inventory. But they're also trying to get inventory from small retailers as well through a variety of mechanisms. And you you go online as a consumer and look at you know, you're looking for a new bike or you're looking for earbuds, or you're looking for a particular running shoe or a camp tent to go camping in or whatever it is, and you may be completely agnostic, I'm willing to buy this online, I may go to a local store and buy this and you're presented with information about who's got who's got a ecommerce, you know, who's got it available in their in their e commerce store, or where you can buy it locally. And you're you're gonna make up a you make up your mind, based on a number of variables, convenience, price, the relationship to the store, whatever is going on. And we haven't been in the situation before, before it was all online, pure play. You know, you had local store information, but you didn't have inventory information. Now, you know, you can buy online and pick up in store, you may go into the store and buy it and all of this is coming through the internet is sort of Mish Mish mosh mix, integration of this kind of content. And that's kind of metaphor for the agnostic attitude of consumers, who will buy offline will buy online. But the but the challenge for the retailer, as I mentioned, is to really is really to bring to make those experiences less dissimilar than they've been and to make it equally convenient for the consumer to shop online or offline. And vice versa. I mean, I don't know if that captures what you were intending but it's really this. We're truly in an omni channel world now in a way that we were never before. You know, it was there was a lot of rhetoric and lip service. But now we're here in and retailers have to sort of embrace that and its implications.
Right. Yeah. I mean, I think that that really covers it. Well, you also said that you think openings will outpace closures.
Greg Sterling 29:00
Well, that's not my that's not that's data from I think that's data from the US government that I was quoting. I mean, I don't have the article in front of me. Yes, there's for a long time stores have been going out of business. There are many retailers that are in financial distress. People are reevaluating the store footprints, we need fewer stores. But But there are a lot of new businesses opening up. And, and healthy retailers are opening more stores. I mean, it's very interesting because the you know, Disney, for example, decided that they were going to close 20% of their stores worldwide and focus on shop Disney, but there are other retailers like Dick's Sporting Goods and target and so forth. And others that are opening more stores, which is sort of, you know, counterintuitive in this environment where there's more ecommerce and people are trying to reduce costs. direct consumer brands, you know, are opening stores because they recognize the importance for their brand And, and for others sort of intangible things, of having a physical presence of presence in the physical world now, they're not going to open hundreds and hundreds or 1000s of stores, but they're going to strategically open stores in major markets so that people can come in and have a have an in person or physical experience of their, their brand. I mean, Warby Parker is a great example of that, right? pure, pure, pure play digitally native brand. Now, I don't know how many stores they have several 100, I believe, and, and those stores are really important to their brand, and really important to the customer experience. So, you know, retailers, or close, traditional retailers are closing stores, in many cases, direct to consumer brands or opening stores. And then some retailers that have been really successful are, quote, unquote, doubling down on their physical presence. But it all has to be done more thoughtfully. Now. And, and in that smart way, as you were saying, for small retailers, there's there's little room for error. But that's also true for some of the bigger brands, you can't, you know, you have to be really thoughtful about your your strategy now, because you can screw up pretty easily. You know, if you open if you put a lot of money into a huge concept scope store and roll those out, and nobody comes, then you, you know, you've lost time and money.
Right? Yeah, I think that something else that retailers need to get a lot better at is efficient experimentation. So that they have to learn how to test ideas, with as little capital and effort investment as possible, and then double down on things that actually are showing better signal. Almost a kind of a b testing for the physical world, you know, yeah. Yes.
Greg Sterling 31:54
I mean, one way to do that, potentially, is to do kind of pop up stores, or concept stores in certain cities that are not fully developed. But I mean, I'm not a I'm not a retail. You know, I'm not I haven't worked in the retail industry. And, you know, I've been an analyst, and I've observed, but but I'm not somebody, I appreciate the just the enormous logistical complexity and execution challenges of all of this stuff. But I think, I think you're exactly right, that they have to, they have to try things. And you can use digital to test ideas out. I think, also, you know, the, one of the interesting things is that, you know, the people are trying to bring the store experience online, more 3d imagery, you know, augmented reality is, is being used both in stores and in apps that give people a sense of what the product is, you know, look at the couch in your living room or the rug, look at how these shoes look on your feet or virtual makeup, that people are trying to this is sort of a cross pollination of digital into stores, and, and some effort to bring a physical dimension to the purely digital realm to give people a more tangible sense of the of the thing that they might be buying.
Yeah, I think one of the one of the, I guess, roles that I'm looking forward to actually seeing more in the industry is maybe an experimentation consultant, or like a VP of experimentation or something that just like really optimize on, you know, learning how to do smart, you know, experiments.
Greg Sterling 33:40
I think you should you should pioneer that role and go do that for some major retailer.
Yeah, one of these days. So, just a reset on the room. I'm speaking with Greg Sterling, VP of market insights for overall. And we're talking about local retail. So if anybody has a question for Greg, and would like to come up, please raise your hand. You're welcome to come up and ask questions. So Greg, yes, go? Yes.
Greg Sterling 34:13
Well, I was I was gonna say, I haven't really talked that much about what what Uber all does. I'll just give you two seconds on that. This is not a pitch or anything.
I was gonna ask you about that actually, for explanatory reasons.
Greg Sterling 34:24
Yeah. So Uber all helps businesses manage their their location data across Google's social sites and other directories. It also helps companies manage their reputation, so local reviews that stores restaurants will get and then there's analytics products and the store locator and a landing page solution and some ads products. But we're really about trying to help these physical brands manage their digital presence and to some degree their cut their online customer experience. So that's, that's what overall does, but it doesn't it's not a real retail vendor per se, even though we do have a lot of retailers that work with us.
Okay, so so what's it? What's a typical customer? for overall? Is it like you work with like small retailers or only large companies?
Greg Sterling 35:20
Well, we have two ways that we work. One. One is with partners. So we have a bunch of partners that have small business customers, and we supply our tools to them, and they resell the tools and manage those accounts. We don't work with small businesses directly. And then we work with with large enterprises, Marks and Spencer and KFC and McDonald's and IKEA and others. I don't know who I'm supposed to mention who I'm not some BP that gesslin. So I, you know, there are some authorized customers that I can mention in some that I can't, I don't know. But we work we work with, we work with large brands that have many, many locations. And, you know, they use these tools to manage to ensure that there's consistency and to create efficiency around the management of this local information. So for example, with COVID, when you had all these different rules all over the place, if you're a global brand, and you're having to comply with lockdown rules, reopening closing back down, you have to change your hours. You know, you have to include other information, Google posts, and all kinds of stuff, social posts, we help companies do that kind of thing.
So what's what's better for local retailers? As far as investment? Is it paid or organic? And also like early customer acquisition? Or, like engagement and lifetime value? optimization?
Greg Sterling 36:54
So the answer is all of the above. I mean, you obviously want new customers, but, you know, I mean, there's the old sort of adage or whatever, saying that, you know, costs, fill in the blank more to acquire new customer versus to retain a customer. So So obviously, lifetime value and retention are very, very important. And that's a function of many different inputs. In terms of organic versus paid, you know, this is this is the perennial debate and, and discussion among digital marketers, I mean, you know, it's very, it's, it's hard to rank on Google. People, people obviously do it. And they're there, there's a discipline built around that, you know, you can, you can buy position through ads, and Google has made ads more and more and more prominent over the years, to the point where you see almost nothing on your smartphone, but ads for certain categories. I think ads can can be used effectively and judiciously. And if you have the budget, you may want to run ads on a regular basis. But for smaller companies, the better investment over time is is organic, you know, to to build up, you know, a compelling online presence, and continue to invest in it, and to engage and respond to your customers. I mean, that's, you know, that's, that's how you build word of mouth, and you build, you know, sort of a loyal customer base. But But I think for for, for bigger brands, you know, it's very, retail is very competitive, and certain product categories are enormously competitive. And there's billions of dollars being spent on them, you know, you just have to do Google searches and see all the advertisers for specific kinds of products. And Amazon to now is is an advertising platform and that and their, their ad revenue is growing faster than their, their their rivals, partly because it's new, and it's growing from a smaller base, but they've got Billy, I don't know what their latest number was billions of dollars.
In ad revenue, they're really growing. Yes. So which one is so let's say if I have a limited budget, and I'm a local retailer, is it better for me to invest my my money in Google ads or Instagram?
Greg Sterling 39:30
I think I think, you know, I don't want to cop out and say it depends. There there probably some considerations depending on the type of retail, you are, you know, where's your audience who's your target customer, you know, there's different different profiles, obviously, for different sides. You know, I my inclination would be to say Instagram, but that's just in a vacuum. I mean, certain certain brands and certain small retailers, I think and small Product companies have had great success with social media. Although, you know, Facebook basically makes you advertise to get any kind of reach. I think I think you could blow through your budget pretty quickly. Google, if you don't know what you're doing. I mean, you really have to know what you're doing to to have success with paid paid search? Yeah, I agree. My gut was say Instagram,
okay. I think I mean, I'm also like, starting to lean that way myself, I used to think that like, really Google, or even paid on Facebook, is where you should start. But I'm actually changing my mind on that.
Greg Sterling 40:45
I mean, the thing about Instagram is that it's, you know, it's visual, there's a massive audience there, you can build a following. So you can use ads to, to help build your following and then sustain the sustain your audience with content. And, you know, I think for some retailers, that's really smart. And it's, you know, can be very, and now, especially with social commerce, and you can buy directly from those pages, I mean, it really can compress, you know, the buying cycle, or funnel or whatever we want to call it in ways that would be harder, potentially, in a kind of a straight up search context, even though you can search, click through to a landing page and then buy a similar, similar funnel, I just, I feel like social is a better bet for a lot of retailers. But that's not to say that you shouldn't have an organic presence on Google, because people are going to search for you know, people are searching huge volumes of product queries on Google. And so you know, it makes sense to to really populate your local retailer, whether your best buy or, you know, independent electronic store, which probably don't, don't exist anymore. Having an organic presence on Google is really important, because people will look you up to call you look you up to get directions for your website, and messaging. And increasingly, a message messaging is a really important kind of aspect of all this, that we're small retailers potentially have an edge over big ones in the service, smaller retailers can deliver is often better than what you get from a large traditional retailer.
Right, right. Yeah, I mean, just just to be fair, engagement on Instagram is pretty drastically different than just setting up ads on Google or Facebook. It's like continuous nonstop content creation, engagement. So it's different. But if you have to invest in something, yeah.
Greg Sterling 42:53
I mean, if you're, if you're a small retailer, what you you know, a lot of a lot of small, smaller merchants Don't think about building a brand. But I mean, social media offers up to that opportunity, you can still do that on Google on Google, my business profile, but social media offer that, especially Instagram, that opportunity to practice and degree, to build a brand. And, and to really, and to really establish, you know, your brand's personality, and to convey that in a way that creates a kind of, you know, connection between the customer and your product or your, your company. And, you know, it's it's much it's much warmer than just a straight up ad, you know, text that even even product, you know, even the shopping ads, which have images in them. So,
yeah, I think this is a very, very interesting conversation and topic. Very important topic. Well, I think, future is there for us to make it right.
Greg Sterling 43:56
Yeah, and I think I think we're entering into a period where there's going to be lots of really into this is this is a great time in retail. I mean, it may be precarious for many companies, but for consumers and for many retailers, I mean, there's just a lot of possibility now. And, you know, walls have been broken down and definitions have been shifted. And as you point out, it's a great time for experimentation. And so lots of interesting things are going to happen as the digital and physical worlds continue to kind of interpenetrate and cross pollinate. And so I think it's very exciting. You know, assume we're assuming we survive as a planet. It's a very exciting time to be to be in retail, just because there's so many possibilities now, even though there's risk for everybody.
Yes, I'm glad you put in that qualifier there because that is a plus. We don't sell we. Yeah, so one more question before we end. What are your thoughts about Live commerce.
Greg Sterling 45:05
So So live commerce thumbs up. I mean, I, you know, it's been proven in China. It's big, very big in China, you know, in, I'm less familiar with what what's exists in Europe, but in the United States, cable TV QVC has been around for years and years, it's very effective. And live commerce is sort of a version of that brought, you know, sort of the, the, the, over the top version in certain way of traditional TV selling on TV. And I think, you know, there's some interesting things starting to happen with, with, you know, Walmart's doing something interesting with a cooking cooking show and, and tick tock and so it's, I think it's, it's unproven in the United States. But I think there's, there's certainly a precedent for it. And I think there'll be some interesting, there'll be some interesting, successful models that emerge that will compliment other things that people are doing. You know, it's kind of, if you have the right mix of personalities and content, you know, people will watch it as entertainment and then buy buy things. And I think that it remains to be figured out. But I think there's an interesting opportunity.
Do you think that live video consumption on the consumer side is, is going to continue to be, I guess, at the scale as it is right now, or even grow?
talked about in the live commerce context? No, just in just in terms of just using live video, live stream video in different parts of their life? Because the reason I asked that is that if if people are consumers are consuming live video, then they're more adapt to use it, you know, using it for retail?
Greg Sterling 47:07
Right. You know, I don't I don't have a strong opinion on that. I mean, I think that I think that live streaming has sort of, you know, was was hyped and is now sort of growing incrementally. It's hard to get people to show up, I mean, clubhouse is a version of this, right, it's a lot of live audio, it's hard to get people to show up real time to pay attention to things, you know, if you're a massive celebrity, or there's some, you know, tremendous event, a concert, whatever, it's different. But if you're just, you know, even if you're somebody like Walmart or Amazon, it may be challenging for you to get people to show up in real time to participate in your thing, absent some really, you know, like Prime Day, some really aggressive discounting or something like that. So, I don't really have a strong opinion about the connection between the two. I mean, I think that live video is sort of progressing. I don't see it as as, I mean, in my particular case, I'm, I'm not going to show up for a lot of things in real time. Just because I'm, I'm, I'm really busy. But I do think that light commerce, in the right context is, is really has a lot of a lot of potential.
Yeah, I think it's a it's, it is an interesting use case, if it's done, right. And I mean, just like, like, you know, webinars, and a lot of these conferences that are online, there's a large percentage of people who subscribe or sign up that don't make it. So then they send them the recorded version.
Greg Sterling 48:47
Right. And people people want the content, they want to hear the programming, but they don't, they don't want to show up at the particular time or it's inconvenient for them. So there may be some hybrid kind of live slash recorded model where you can still get the benefit of the train, you know, you can still do the purchase. So, you know, with the upcoming Prime Day, I don't know if they're, if Amazon has live commerce scheduled, I assume they do. They've done that in the past. So for some very concentrated period of time, where there's a lot of discounting going on, people will show up for that. And then, you know, potentially could get the benefit of the same pricing. I don't know if Amazon's doing this in some future point up to a deadline. But I don't I just I don't I don't foresee dozens and dozens of companies doing live commerce. And having success, it's going to be like a like a programming model like a reality TV model where there will be breakouts, and there will be some successes, but everything doesn't succeed because people are interested in the in the in the form of the medium. It's you're going to have to have celebrities, you're going to have to have, you know, some incentive for people to show up. And, and that that will that will work. Or you're going to have to I mean, QVC work because people were at home. And, you know, there was a certain kind of novelty and entertainment value to seeing products and, and getting exclusive discounts. And they have some core audience that's very loyal to them. I don't watch it. But I don't think it's a mass audience phenomenon as a daily experience. I sound like I'm sort of contradicting myself, but
well, it is it is kind of, there's no simple answer to it. So I think it is like an experiment, right? It's an experiment that we are trying right now, we don't know what the outcome is going to be. But we have to try to know.
Greg Sterling 50:50
Exactly. And, and, and that's, that's an important point. I mean, that's this, if anything, COVID-19 should have taught retailers that they need to examine their assumptions, be more responsive to their audiences, and experiment and try things. And that's one of the great, I mean, you know, as horrible as it was, it was horrible and continues to be for all the people that have lost their lives and been ill. The benefit, if I can even use that terminology is that it freed people to try things, and to and to break out of traditional ways of thinking about their products and services. Now, when we go back to normal air quotes, whatever that is, now, or six months from now, there will be some backsliding and people will will will return some regression to old ways of doing things. But those that continue to be experimental and responsive to their customers and audiences, I think will be the ones that are most successful. And I think there's a need, because the world is so accelerated to be willing to change and adapt on a regular basis. I mean, it's sort of an evolutionary model.
Yeah, yeah, definitely. I think that's what experimentation is really important. And you know, every product category is going to be different. Some people are going to do a lot better, because they're better marketers, they might have better people on the video, I mean, they might have so it's not going to be like one answer for everybody. But if you don't try it, you're never gonna know and you might actually end up losing a significant potentially, portion of, you know, some some revenues. So Exactly, exactly. Yeah. Well, thank you so much, Greg. It was fascinating talking with you and learning about your experience. So look forward to maybe continue our, our engagement somehow and learning more on this local is, is that part of my daily life in my own business, which is not this podcast, this podcast is for a hobby and learning very interesting people from you and meeting and learning from them. Yeah.
Greg Sterling 53:07
Yeah. It's great to talk to you. Thanks for having me. I there's tons more to talk about. So be happy to talk in the future, if you like and enjoyed it very much.
Sure. Awesome. Thank you so much. Have a great day. You too. Bye. Bye.