The Brand and Retailers Guide to Marketplaces, Ecosystems, and the Metaverse

Global eCommerce & Retail Forum: Panel 1

Jun 30, 2021 12:00 PM12:50 PM EST

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Key Discussion Takeaways

The digital commerce landscape is constantly changing. The Covid-19 pandemic accelerated trends that were already happening, and companies around the world are adapting. How do you navigate a business world that is increasingly online and expanding globally?

Michael Zakkour has helped hundreds of companies adapt their domestic and international operations for digital commerce. He founded his own company, 5 New Digital, to address the “5 New” realities of the digital revolution: New Retail, New Consumption, New Technology, New Finance, and New Supply Chain.

In this virtual event, Aaron Conant talks with Michael Zakkour, Founder and CEO of 5 New Digital, about the major concepts that affect how we brand, sell, and market today. They also discuss five new ways you need to think about digital commerce, the difference between digital commerce and eCommerce, and what to consider when looking into international expansion.

Here’s a glimpse of what you’ll learn:

 

  • Michael Zakkour explains his background, why he created 5 New Digital, and how he chose the name
  • Three major concepts that affect how we brand, sell, and market today
  • How is 5 New Digital reaching people through technology?
  • The difference between digital commerce vs. eCommerce, and omnichannel vs. unified channel
  • Five new ways you need to think about digital commerce
  • How the Covid-19 pandemic accelerated trends that were already happening and the companies that rode the wave successfully
  • Q-commerce: how to integrate your online and offline sales with QR codes
  • Why companies like Spotify, Netflix, and Twitch are moving into the retail space
  • Things to consider when looking into international expansion
  • What is social commerce?
  • The livestreaming industry’s impact on companies like Amazon, Twitter, and Google
  • What is the metaverse?
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Event Partners

5 New Digital

5 New Digital is Digital Commerce, New Retail, & Unified Commerce Consultancy focused on strategy and construction for brands, retailers & services companies. Their services are built around the "5 New" realities of digital commerce: New Retail, New Consumption, New Technology, New Finance, and New Supply Chain. ​ 5 New Digital was built to address the “5 New” realities of the digital revolution: New Retail, New Consumption, New Technology, New Finance, and New Supply Chain. ​ Our clients engage us to provide them with research, strategy, and implementation across the commercial value chain and to help them engage in the Mega-Ecosystems of commerce and to build their own.

Connect with 5 New Digital

Guest Speaker

Aaron Conant LinkedIn

Co-Founder & Managing Director at BWG Connect

Aaron Conant is Co-Founder and Chief Digital Strategist at BWG Connect, a networking and knowledge sharing group of thousands of brands who collectively grow their digital knowledge base and collaborate on partner selection. Speaking 1x1 with over 1200 brands a year and hosting over 250 in-person and virtual events, he has a real time pulse on the newest trends, strategies and partners shaping growth in the digital space.

Michael Zakkour

Michael Zakkour

Founder of 5 New Digital

Michael Zakkour is the Founder and Chief Strategist at 5 New Digital, a consultancy that advises clients on strategy, structure, implementation, and transformation in the digital realm. Michael has over 20 years of experience in eCommerce, specializing in digital transformation, the new retail, data science, the China/APAC market, digital commerce, and new retail strategy.

Event Moderator

Aaron Conant LinkedIn

Co-Founder & Managing Director at BWG Connect

Aaron Conant is Co-Founder and Chief Digital Strategist at BWG Connect, a networking and knowledge sharing group of thousands of brands who collectively grow their digital knowledge base and collaborate on partner selection. Speaking 1x1 with over 1200 brands a year and hosting over 250 in-person and virtual events, he has a real time pulse on the newest trends, strategies and partners shaping growth in the digital space.

Michael Zakkour

Michael Zakkour

Founder of 5 New Digital

Michael Zakkour is the Founder and Chief Strategist at 5 New Digital, a consultancy that advises clients on strategy, structure, implementation, and transformation in the digital realm. Michael has over 20 years of experience in eCommerce, specializing in digital transformation, the new retail, data science, the China/APAC market, digital commerce, and new retail strategy.

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Aaron Conant

Co-Founder & Managing Director at BWG Connect


BWG Connect provides executive strategy & networking sessions that help brands from any industry with their overall business planning and execution.

Co-Founder & Managing Director Aaron Conant runs the group & connects with dozens of brand executives every week, always for free.


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Discussion Transcription

Aaron Conant 0:18

Happy Wednesday everybody. My name is Aaron Conant, Co-Founder and Managing Director of BWG Connect. We're a networking and kno group with 1000s of brands, we stopped counting around 7000. And we do exactly that we network. And now we're here together to stay on top of the newest trends, strategies, pain points, whatever it is shaping digital today, I talk with 30 to 40 brands a week to stay on top of those trends, strategies. And when the same topics come up over and over again, we host a variety events in person, those are coming back, they've been away a brief hiatus for the past 15 months or so but they're coming back next quarter would love to see people in person again, rub some elbows, we do a lot of one off virtual events, close to 300 this year. And then about six to seven times a year, we do a half day event like this where we have enough content and enough questions from all these different brands, we decided to tackle it for our suite. So if you miss any of this, you want any feedback, you want to additional data, don't ever hesitate to put time on my calendar or just ping us. And we can either give you downloads to pass sessions, or loop you in with great people across the board. We do a lot with partner selection as well. If you're looking for new partners, we do a lot with talent. If you're looking to hire Well, there's a talent division here, the network's big enough is enough pool of people that we have a talent agency if you'd like if you're looking to hire. And then obviously any kind of networking and connecting that you need more than happy to help you out with that. You know, as we get started today, and so long session, we're going to wrap up, you know, four hours from now. But at any point in time, we want this to be as informational and educational as possible drop questions into the question section, we will get them answered in real time. If you can't do that, if it's easier, you can email them to me Aaron a rln e wg Connect calm and we'll get questions answered that way as well. You know, the question section is a little bit easier for us to handle, you know, live is live streaming as a whole. So these are a few of the top areas of interest that we're hearing about right now. If you want to learn more you have questions about these are you looking for any kind of service providers, but again, shoot me an email on any of these can give you a shortlist from, you know, all the brands who they're saying is working in his networking more than happy to facilitate those connections as a whole. So we're going to kick this off today, the new retail and so we've got a great friend, a great partner, supporter of the network, working with just a ton of brands, you know, startup the fortune 100, across the board with digital strategy as a whole. That's not only us base, but help the ton of companies internationally expansion expanding as well in the digital space. And so when I'm talking to these brands, and what people are trying to figure out right now is this idea of the new retail, you know how marketplaces platforms, the metaverse, which is really interesting, and we're going to dig into that a little bit a revolution. revolutionising consumer consumption as a whole. I think everybody's trying to figure this out. I think there's a lot of people that set up, you know, is a pandemic, HIPAA said, Hey, we have to change how we're doing business. We don't necessarily know how they went running off to try to figure it out. You know, a lot of brands are hearing or taking a step back saying, okay, we know enough to be dangerous. Now let's go find the right partners to help us out. And so, you know, Michael, I'll kick it over to you if you want to do a brief intro on yourself and 5 New Digital. And then we can kind of get into, you know, the, the meat of the talk as a whole.

Michael Zakkour 3:43

Sure. Thanks, Aaron. And first, I want to thank you, Aaron. Bill Williams, Nick sands, Pat Dell, I mean, Matt, Mike Savino, the whole crew over BWG. If this is your first time on a BWG call or working with them, I really hope it's not your last I've been working with BWG for five years now. And I can say unequivocably, they're the best partner I have period. And I have a lot of partners. They're the one company that they not only always deliver on what they promise, they've never failed to over deliver on any kind of interaction I've had with them. So whether it's you know, these live events, the dinners we've done with the one hour webinars, awesome company, awesome people. And you know, it's just so many partners I have and people are important to my business came from BWG and it really feels like a family when you're working with BWG companies. And just a quick note on Aaron. I don't know anybody who knows more about what's going on in the brand retail CPG retail space. I don't think he has to be a cyborg. Because, you know, it's the 4550 companies a week and he literally remembers what every single one of them they're doing what they need, who they should be talking to. So please, you know, engage BWG as much as you can and use Aaron as a resource. They've been just the best partners I've ever had. So first, I just want to welcome everybody this afternoon. My name is Michael Zakkour. I'm the founder of a company called 5 New Digital. And in a couple minutes, I'll explain to you why the company is called 5 New Digital. The Long story short, you know, I've been very lucky and fortunate in having a very unusual career path. I've been in digital commerce, eCommerce, internet technologies, and E retail since 1995. I was one of the first team members out at Microsoft's red West Campus. I was on the launch team for properties like Expedia, Hotmail, MSN cardpointe, which was actually the first online car buying service. And then over the course of the web 1.0 world, in many different capacities as company founder, advisor, consultant. And then in 2002, lightning struck again, and I had the opportunity to go to China, because somebody told me this China thing would be really big someday. Wow, that turned out to be the understatement of the century. And so I got to China. Actually, before there was even eCommerce in China I got there in 2002. Alibaba launched Taobao in 2004. And then almost impossible. Impossible odds, I was on the front lines of web 1.0 in the US and on the front lines of web 1.0 in China. And I've spent 18 years in the China Asia Pacific market. And then I also work for nine years for a company called Tompkins International. The reason that's so important is because their supply chain operations, logistics and fulfillment company, and basically got a doctorate in all things supply chain, even though I was running a global digital commerce strategy for them and Asia, digital and consumer strategy for them. Being in that environment taught me about me. Now, why is that important? Because we're going to talk about what the two main enablers in retail and consumption in eCommerce and digital commerce are. One of those, obviously, is how well you do on supply chain logistics and fulfillment. Listen, in this business, your two greatest cost centers are your your CAC, your consumer acquisition cost, and your fulfillment costs. And if you don't master those, it's really tough to make a living in this business. We'll we'll touch on that a little bit. So anyway, founded 5 New Digital to address three major, you can go next Aaron. Three major things that are reality and retail today and in consumption.

You know, for 50 years in science fiction, we've talked about cyborgs, you know, part man part machine. And we're not quite there yet, where although there are some people who are out there are implanting themselves with chips and robotics into their body. But for the most part, we're not a society of cyborgs yet. But I think over the last few years, we made that first step towards it. And the point there is, we all operate with two hard drives, we were born with a hard drive that resides in our skull. And we all walk around with a personal digital device that acts as our external hard drive. If you don't believe you have an external hard drive, put your phone in a shoe box, put it in the closet, leave it there for 30 days, and then come back and talk to me how your life, both personal and professional are going. Right. So what we like to think about today is it's incumbent upon brands, retailers, cpgs manufacturers define that space between all of our internal and external hard drives. And that's the context for us. Next, please.

Aaron Conant 9:41

Yeah, I mean, I think I want to just jump in there because speaking like that, a lot of brands that I'm talking to are also trying to teach upwards, breach upwards into the higher levels of the organization. And that it I just in your context of how you put it there is that constant reminder, you can't just be thinking Right, with that, you know, your internal hard drive, you have to realize that everybody on the planet now just about every consumer, has that external hard drive to, and how are you talking through that external hard drive? Anyways, awesome, you know to the

Michael Zakkour 10:17

so the we founded the company based on the principle that there are three major concepts that are affecting every part of how we live and shop, and make and brand and sell and market today, Aaron referred to the first one, which is the new retail model, the new retail model was born in China, it's now going global. Essentially, the new retail model is the complete integration of all things online, offline, technology supply chain and Media related to build out an ecosystem. So this is the Alibaba model. This is the 10 cent JD model. Increasingly, it's the Amazon, Walmart and Target model. How do you integrate all of that to build an ecosystem of products and services that a consumer can step into through 50 doors, find 100 places to play inside the ecosystem and find 50 ways out. The second concept is digital commerce. And it's very important. And for those of you who've been on with me before in past sessions, I can't emphasize the importance of this enough. There is a difference between digital commerce and eCommerce. eCommerce is one set of digital habitats where you can educate, entertain, and sell products to the consumer. You can take contributions of thinking about how to shape your brand and your company in that environment. That's eCommerce. And there are roughly six or seven different models of eCommerce that you can engage in. Digital commerce is the application of digital tools, technology it and data science across the entire organization. Right. So when people are talking about digital transformation, what they're really talking about, in my opinion, is creating a digital commerce environment. So how do you apply those tools, these are digital tools to solve analog problems. At the end of the day, you still have sales KPIs, you estimate, you have a p&l, you have a boss to please, you have a consumer to delight, you need to move products faster and more varied ways than ever before. I need to move containers but I also need to move each is. So digital commerce is the application of that across the enterprise, ultimately, for consumers interested. And then the final big concept is what we call unified commerce. Most of the world is still talking about and operating on the growth principle of omni channel. I've been fighting a losing battle for two years now. But I'm starting to see some daylight on what is the difference between omni channel and unified commerce. omni channel is a loose affiliation between all the channels you're selling through. unified commerce is a complete integration into all of your channels, all of your habitats, all of your marketing all of your it. It's basically needing the one demand that consumers have today, which is spoil your yells spoil Meirelles spoil me or else I will find a brand, a retailer. an eCommerce company who will spoil me. Okay, ubiquity through unified commerce is how you spoil the consumer. So as Aaron mentioned, we work with global 1000, fortune 1000, brands, retailers, cpgs. manufacturers, but we also work with startups in various seed stages on how to master the concepts of new retail unified commerce and digital commerce. Next, please. So the five mu of digital commerce is a recognition that businesses have always run on a basic set of principles from the Industrial Revolution on but with all that's happening in the digital world today, all that's happening in technology and innovation. There are five new ways you have to think about a digital commerce world. So we mentioned new retail and unified commerce. Then new consumption models, new consumer journeys, new needs new demands new spaces, we're going to talk about a lot of new spaces where The consumer can enter into. And then we also have to talk about, you know, the COVID, alterations to society.What we heard a lot about over the last year was how COVID sped up trends that were already happening. So it was the great acceleration. And to a large degree, that was true. And, but there was something else, you know, there was transformation, things that weren't there before. They're all there now. So, rather than looking at it from what was accelerated and what was transformed, we have to accept that we live in a COVID altered world, right? There's a lot of stuff that's not going back to the way it was, you know, the purpose of the physical store, the way people think about shopping, consumer psychology, trauma based shopping, social interactions, a lot of this stuff, there's no magic button that says, on December 20 2021, the world goes back to march 1 2020, right? new supply chains fulfillment in supply chain is your competitive advantage. It's not a function. If you look at the most successful brands, marketplaces and retailers today, they've mastered the art of the flexible and scalable supply chain. And so if you see those two in red new technology and new supply chain, those are the enablers that make anything possible. Right, you have to start with those enablers. New Tech new supply chain makes anything possible. The companies we're winning today have a master of the art and science of those two, and have learned how to build profitability around them. We have new finance. So everything from FinTech, crypto, NF T's, digital wallets, wallets, new payment systems, marketplaces, financial institutions, you know, look at Amazon, they're going to get into the pharmacy business, they're going to become your bank. They are now laser focus on the services industries, right? They've kind of mastered the art of losing money to sell you product, but they make their money were on logistics and supply chain. And on IoT, and cloud computing. Well, their next profit centers are going to be all about services and services industries. And that's a key hallmark of an ecosystem. How you go from a marketplace to an ecosystem is by including payments, delivery, services, entertainment, media. So those are the five new, I give you one bonus one here, which is the new organization. If anything's become clear to anybody who's paying attention these days, that that line that used to separate who's a retailer who's a wholesaler, who's an innovator, as a startup, are you a legacy company? Do you have a startup company inside your legacy? Are you a media company now, it's becoming increasingly apparent that you need to be a little bit of all of those things to succeed. So whether you're launching a new DTC, whether you're Walmart, or target, or Amazon, the new organization is a hybrid of all of these areas of excellence.

Unknown Speaker 18:42

Wow. Love it. So, um, you know, I'm in

Aaron Conant 18:50

questions along the way, just drop into the Questions tab, and we'll get them answered.

Michael Zakkour 18:54

It's awesome. Yeah, please, please do ask questions. I'd rather this be more conversational. So please, anything that is not clear. Anything you want me to expand on, please, please drop a line. So you know, I'm in the I'm in the business of being a retail consumer and digital commerce technology futurist. But I'm also in the business of working directly for my brand retail CPG DTC clients, to get them the head start on the future. So just looking back to 2018. If you see those, those four purple bars, these are all literally things that we started writing about working on and doing for our clients 543 years ago. Yet the vast majority people always gave us the same answer. That's years away. That's five years away. works in Asia, it'll never work here. Right? So we talked about the new retail model going global in 2018. And lo and behold, as QR codes will take North America and Europe by storm, I'm guessing, you know, most of you listening today, the idea of a QR code hadn't entered your thought process 678 months ago. And now the world is lousy with QR codes, right. And there is a term that I call q commerce. I don't know if I coined it. I don't know if I was the first person to use it. I've never seen anybody else use it. But my term for it is cueCommerce, because it's a whole new environment and habitat for how to sell and how to integrate your online offline sales. And we'll talk about what Q-commerce is going ahead. But basically everything from your menu to, you know, glossy fashion ads in Vogue magazine, the QR codes everywhere. Live Stream, you will start slowly then exploding North America and Europe. We're not quite a date splosion yet, but we are way beyond infancy and toddlerhood and moving into young adulthood for live streaming. For some perspective, live streaming was a $350 billion industry in China last year. And what that means is $350 billion worth of products were actually being sold, while somebody is doing what I'm doing right now looking into a camera and talking to you and showing you a product and you're able to buy it in real time from the live stream. On QR codes and live streaming and social commerce, whether you're a DTC, a startup, a major ecosystem, a marketplace, you have the opportunity today that the DTC brands had eight years ago, which is to buy really cheap media and integrate it into everything that you're doing. Right. So the DTC playbook eight years ago was bypassing the middleman, lead with content and buy up cheap social ads. Well, as everybody who's listening to this knows, I think the only thing that's outpaced the the rise in inflation of a university education is the price of social and search media. And that's true here. That's true in Europe. It's true in Asia. So I'm a firm believer that, you know, go into QR codes, live streaming and social commerce. Now, while you have the chance to test and learn and quickly experiment quickly, for basically pennies on the dollar. We also talked about a few years ago that retail will be everywhere. Retail is everywhere today. Right? Whether it's digital, whether it's physical, whether it's in a refrigerator, in the back of your car, whether it's on your phone, whether it's on your PC, retail is everywhere. And finally, we we predicted that, by 2021 22, that cross border eCommerce would be a $600 billion industry. Three years ago, it was $150 billion industry.

I hate to say it, but I was wrong. I missed the mark by $180 billion. So cross border eCommerce is now a $780 billion industry.

Aaron Conant 23:57

So so a couple questions that come in that I want to tack on some of our comments. And you know, one of these just coming if you look at streaming media, YouTube, TV and video on demand sites like Hulu, you're now starting to see QR codes embedded right on the side of the commercials. Yeah, I don't know why those aren't more places. Why are we seeing more of them? And I think well, like he said, The other question is question the things you're outlining, as relates to the number of, you know, things that successful companies will need to do is massive. doing them at scale will require substantial effort. Do you see an ecosystem evolving to service and or support mid tier players with bank finance, logistics, etc?

Michael Zakkour 24:40

Yeah, so absolutely. The the good news in all of this, and I'm gonna actually show you examples of it in a few minutes, that a lot of this stuff is either a being built as a feature in the big mega tech players ecosystems. So Google Apple, Microsoft, Facebook, YouTube, a lot of this stuff is being built for you. And it's there for you to utilize. That's number one. Number two, there's a ton of off the shelf solutions, both on the supply chain and fulfillment side on the tech side, on the software side, that that's very affordable for SMEs. So a lot of this now is off the shelf. And I'll give you some examples of that. So let's go to the next one. So, we have talked about for a couple years now that the world of retail and commerce would split into three major categories, ecosystems, platforms and habitats. There are roughly 12 global companies now who build legitimate and far reaching product service entertainment and computing ecosystems. Amazon here is is an obvious one. Walmart and Target are getting there. Obviously Alibaba JD in China perfected it, they invented it. But we also look at racket 10 in Japan, Mercado Libra in South America. These are major ecosystem players. on the platform side, you can look at Spotify for music, you can look at twitch for gaming, Netflix, for video, entertainment, Etsy for do it yourself. Those are all platforms. What's amazing is we I think in the December hour we did with you, Aaron, we talked about how we were absolutely positively sure in our shop that Twitch, Netflix, Spotify, and the others would actually become retail environments. Well, lo and behold, if you looked at the news, the last couple weeks, Netflix started selling their first products. Spotify is going to shock everybody very shortly, when they start producing retail and visible audio and visual shopping environment. And Twitch is going to move very quickly, they already have in a lot of ways. So when we talk about retail is everywhere, right? It's in the ecosystems in the platforms, but it's also in the habitats and the habitats we basically break down into physical and digital habitats, right. So the physical habitats can be everything from pop up stores, to experiential stores to small format, hybrid, experiential and transactional to transactional, pure, but it's all tech enabled. So you know, you're thinking about where am I taking my product? Where am I taking my brand? Where am I where my I want to make my money being the guy selling the shovels and the axes instead of digging for the gold walking you add if you're not a brand or retailer to enable the ecosystem platform and habitat model, but we're clearly at a spot now where this is a mature system. I think this is the one where where people, you know, have a lot of confusion about and you're saying we know we got to go go go. But if you don't understand this, this tri triad ID system, it's very difficult to know where to go.

Next. Okay, so marketplaces, big topic that was on the BWG, what we talked about slide that Aaron showed you, marketplaces, marketplaces, marketplaces. And I'm standing for a fact here. Amazon is not a marketplace. It's an ecosystem. So when you're mapping out your digital environments, and where and how and why you want to sell to lump Amazon in with the other marketplaces you're interested in, is a fool's errand. Right, for all the reasons we talked about. They're a technology company. They're a logistics company. They're a services company. They're an entertainment company. They build an ecosystem. We can look at a lot of other marketplaces that are still marketplaces. But when we talk to our clients, we say if you're looking at that landscape, you have to look at eCommerce, quote unquote, as Amazon marketplaces, your DTC site. Social Commerce, live streaming,

Unknown Speaker 30:11

third party in general, Walmart,

Michael Zakkour 30:15

third party specialty, chewy, okay, and then you take those seven you save that's my eCommerce map, but separate Amazon out from the marketplace because it's a whole different skill set now. Right. And I think we're going to talk a little bit more about that today. Okay, now everybody's asking me, are the marketplaces getting too big? Are they getting too powerful? Is the consolidation in the marketplace world going to squeeze all the life and oxygen out of the other eCommerce habitats, right. And so it is a paradox, the big ones are getting bigger. But eventually they get big enough to a maybe become an ecosystem. So they're no longer a marketplace. But at the same time, new marketplaces are threatening the already established marketplace. So what's going on with marketplaces? Is it consolidation? Is it fragmentation? Or is it both? And for me the answer right now it is both right? We're seeing a consolidation, we're also seeing fragmentation. And where you see the momentum going with governments across Europe, the US and Asia, no matter what system of politics, they run, and all of these governments are increasingly uncomfortable with the consolidated power of the ecosystem and marketplace players. So keep an eye out for that. So it's really important to start thinking about the new regulatory environment that's on its way. And to keep in mind that in some places, the consolidated bigger guys are an advantage for you. But then there's fragmentation, too. So just

Aaron Conant 32:08

a couple other clarifications when they come in, are you saying the ecosystem can have a marketplace within it? Or just the marketplace grows into an ecosystem and has additional

Michael Zakkour 32:17

items associated with it? Yeah, so I'm a bit of both. So Walmart, for example, is growing itself into an ecosystem, but it has a marketplace within its ecosystem, okay, target growing ecosystem, but they have a marketplace inside the ecosystem. Okay, marketplace participation should be a global strategy for now. And let's take a look at this list.

Unknown Speaker 32:49

Next, please.

Michael Zakkour 32:51

eBay Alibaba JD, WeChat, rapidan, Yahoo, Japan, Amazon, Europe and Japan. Mercado Libra, a coupon in Korea. lazada and shopee and tokopedia in Southeast Asia, Flipkart in India, Allegro, juvia, mercari, auto market Platts, VIP shop, Ollie Express, trendy, all wayfair and wild berries, just to name a few. Right? And so where we're leading our clients is to take a deep dive into who all of these marketplaces are, and say, What role does this play in my possible globalization strategy. But there is no doubt this proliferation of global marketplaces is going to account in the next couple of years, for roughly roughly 65% of all Global eCommerce is going to happen on these marketplaces. So if you're not thinking about them today, you should be

Unknown Speaker 33:53

sure that I mean, I'm just thinking about it as a whole then. So this is without

Aaron Conant 34:00

a doubt, everybody should be looking into this if international expansion. And if you're not your competitor is most cases, right. was the last part. And in most cases, your competitors are like, I think for the longest time, you know, conversations I've been having, getting to go international is really tough. Right? Do you have a presence there? How do you market there? What about translation? Is the product there? terrorists fees, you know, taxes, whatever it might be? Do marketplaces help you find a way around that like, you know, a team all global?

Michael Zakkour 34:37

Right. So some of them have the solutions built into the system. But increasingly, all of them are offering cross border commerce options, which is how we went from 150 to $780 billion in cross border eCommerce in the last three years. Right. The government's in each of these countries. are making it increasingly easy to do cross border. But, you know, an example could be though, if you're doing business in Southeast Asia, that's part of your strategy anyway. Are you doing business on lazada, shopee and tokopedia as part of that larger strategy? And if you're not, why not? Next, please. Okay, so I want to dig in real quickly here on the three that we've been, you know, working on with our clients globally for three years. Well, I mean, I've been doing QR codes in China for seven years. So there aren't too many people out there have been say, we've been doing QR code strategy and content for seven years. But nonetheless, here we are. So I just want to show you guys a couple of quick examples here. A number of brands 20, I believe was my last count all did Pride Month. special offers on QR codes. So Skittles, if you see that queer codes, their Skittles did a QR campaign just for Pride Month. And lots of rich content, some of it localized featuring activists and shoppers. And you know, what I thought was brilliant about it is, you know, basically Skittles are the rainbow flag in a package. And so you know, kind of connecting those two and you know, using it as a new way to, you know, recognize Pride Month and inclusivity. But this Pride Month, Macy's, Skittles and h&m were all some of the big companies who did special QR codes for for h&m. You see the other visual there? That's for PetSmart. And I gotta admit, you know, when I'm thinking about innovation, and progressive uses in store tech PetSmart isn't exactly the first name that comes to mind. But a couple months ago, I adopted an eight month old Cocker's a month, eight week old cocker spaniel. And so I went to PetSmart, you know, I had to buy, you know, $12,000 worth of gear for a six pound dog. But one of the crates I was looking at had a QR code on the tag. And so I scan the QR code. And it immediately took me to an instructional video on how to put it together. It took me to YouTube dog training videos, it gave me the catalog of the company's other products. Wow, they nailed it. They absolutely nailed it with that, right. Another example, somebody a couple weeks ago handed me a Vogue magazine. And one of the high couture fashion companies that I don't want to name ran a full page glossy ad. The only difference is they had a QR code on the ad. And when I scan that QR code, it took me to their live runway shows. It took me to their catalog, it took me to a link where I can talk to somebody live and make them my personal shopper, etc, etc, etc, etc. Okay.

Now, the important thing here is don't just stick one on everything, right? QR codes are easy to generate. And they're easy to put on a package or an app. That's the easy part. Having the strategic idea behind why you want to use them, and the rich content that you're going to connect to. Right. That's an important part. Because studies have shown auto and research has shown that when you put a QR code on your package, or whatever, and all it does is simply redirect you to a website or a 10% off coupon. People don't they don't they won't scan again. So really, really important to come up with a deep rich content strategy for how you use the QR codes and how you connect it to your new retail model. So that's the essence of Q commerce, which is you can create all sorts of new behaviors, new consumer journeys, new rich content delivery, if done right.

Unknown Speaker 39:53

NetSuite So question? No, I mean, there's some that are coming in.

Aaron Conant 40:01

5g and IoT play a role in the next round of improvements in eCommerce. There's a bunch of that come in, I can't quite get to all of them. You know, HBO, NFL. But anyways, cover the other questions that come in. But I want to tackle that one. What were all these see 5g and IoT playing? That I really want to get into live streaming? Because I think live streaming is. I agree with you. I think it's I mean, you've got the crystal ball. Right. I that's why I love these conversations, like seeing the stuff, you know, from 2018 that you predicted and now good, true. But also, I want to know what's next that I think this is one of them lives.

Michael Zakkour 40:36

So yes, so I, you know, I think we're still a lot further behind on 5g than than we think. I mean, you know, I live in the New York metropolitan area. And there's like three neighborhoods in Manhattan where you know, my 5g signal comes on. And then in a 20 mile radius around Midtown, I get no 5g. And quite frankly, the 5g I did connect to wasn't noticeably faster, more amazing than what I already had. So I think there's a long way to go on 5g, but it's coming. And when it does, it will be a game changer in what we're going to talk about before we finish, which is metaverse, 3d ar, all that stuff. That's where 5g is gonna come into play. For the current habitat system, I don't think it's terribly important. On the IoT stuff, I'm have a mixed opinion there. I think people find it incredibly useful, whether you know, it's for the home for the factory for the office. My bigger concern is all the privacy issues around IoT. You guys might have seen a story last week, that was it was a hassle is going to use your home goddamnit that the home that the virtual assistant at home basically has its own Wi Fi system, right. But they're going to withdraw 1/1000 of your signal and connected to every device in your neighborhood. Alright, yeah, I

Aaron Conant 42:28

think it was Amazon, right? Yeah.

Michael Zakkour 42:30

I'm sorry. It's Amazon and Apple, my abode is Amazon, right? So this idea that they're actually going to draw a piece of your Wi Fi for their benefit of no benefit to you, they'll tell you a couple of reasons why. So whether it's digital assistants, you know, the smart refrigerator, the smart home. Personally speaking, I made a commitment four years ago, that I would never make my house a smart house, and I would never use digital assistants. And I think there could be a lot of blowback on the IoT. So yes, it has its uses. Let's see where it goes. Awesome.

Aaron Conant 43:09

Now, I want to jump into the next few here, because I think they're kind of the futuristic looking. And I know we've probably got about eight minutes left. So let's, let's dive into these. If anybody, if you follow our conversation, Michael is one of the nicest people on the planet. And he's more than happy to set aside time to chat with you on any of the stuff, we don't get through it all. And I would encourage anybody, if you've got that 30 minutes to spare 100% do it, it's going to be well worth your time. He's all around great person as a whole and open to sharing all this stuff and more intimate setting, I guess, as a whole. But, Michael, if we jump into live streaming here and try to tackle these next,

Michael Zakkour 43:49

some key bullet points on live streaming, um, you know, again, $350 billion industry in China last year, a billion and a half dollar industry in the US. We expect that number to be somewhere around 40 to $45 billion by 2025. So what all you guys need to understand is right now there are three models you can do for live streaming. And they're the big tech platforms that are building the capability into their system. So if you've seen you know, been on Amazon lately, they're pushing Amazon live hard. And they've set up you know, influencer programs, they've set up incentive programs. So Amazon's pushing it live. Twitter's going to be coming with, you know, an extension of spaces meant for livestream. Google basically, is they're on their way to they've got the biggest and best platform that was custom made for live streaming and YouTube. So that's your choice. Number one, use the big tech platforms. The second choice is the startup companies now, who are aggregators, it's almost, if you think of them like a cable TV subscription, so that the two I like that I'm looking at right now. One at one is pop shop live. And so they're an aggregator where they can run live streams, 24 seven, and the brands run their live streams on that site. The other big one, that space right now is called talk shop live. I love their setup. I mean, it's almost like, you know, when you bring up your, your stream, your main streaming menu, whether it's Roku or Apple TV, and you can scroll through the 30 different, you know, live streaming channels, well, they set it up the same way. So they only have a rock and roll channel, they have a cooking channel, they have a makeup channel. They're very celebrity driven right now. So you're either hiring a celebrity to do your live stream, or it's a celebrity pitching their product. Okay. The third choice you have now, and this is just come on line really, in the last six months, is the ability to do the live stream on your website. And I'll show you a slide before we finish that there's a system now that literally in 24 hours, you can plug and play the capability to do live streams and replays on your website. So when you're thinking about live streaming, you have the big tech platforms, the aggregators and live on your site. And I yeah, okay, so social cobnuts. All right. Social Commerce again, you know, the big three for me QR codes, live streaming social commerce. Huge difference between social commerce in Asia and the West right now. In Asia, the emphasis is on the word commerce. Okay. $280 billion worth of merchandise was sold in the social app. So they're not redirecting you somewhere else. Right? The idea is to entertain someone, engage them, talk to them, and sell them something while they're in the app, pay $300 billion. In the US, our emphasis is still on the social aspect. Right? And listen, you need both, right? You need social media for a variety of reasons that we obviously don't have time to go through right now. But where I see things moving in the next two years, and there's still an early opportunity to get on this is to create a commerce oriented social media, social commerce. So you know, I like I said, I think that could be this particular industry, you know, $25 billion in next three or four years. A global trend that hasn't hit the shores here yet that I see coming also, is in Asia, eCommerce, and social media and social commerce are in the process of being blended into one whole now. So that there's a seamless no line between eCommerce social commerce live streaming, is basically one experience. Okay. Okay, next, please.

What do I think is coming up in the next few years? I know none of you can read that. But anybody who wants one, you know, when we get the email afterwards, I will send you this deck. But some Quick Hits here. Some of them we covered platforms that aggregate 10s of million users will go all in on retail, right, Spotify net. So the name of the game today is just aggregate enough people. And what I'm talking about with a lot of my clients and my contacts, they're basically saying the new game in town is build an audience in a community first, and then figure out what your product is that you want to sell them. Right. So first, the last five, eight years have been about, you know, building a great product and building a community around it. The smart people are building the community first, then figuring out what to sell. The metaverse will become viable. An important

Aaron Conant 49:26

fan of the metaverse really quick, too. Yeah, I

Michael Zakkour 49:28

got a slide on the metaverse that we can close out with here. Shopify will complete its evolution to a full ecosystem. This one I know if you guys have seen this cities are setting up their own marketplaces now. So they're saying one way we can blend eCommerce and shop local is New York City will have let's just say you know New York City Market calm and it's gonna be populated only by New York City. brands and retailers. You'll see this in cities across So that blend of shop local and digital is coming. Retail media groups, you're going to see it go from lot, you know half a dozen today to dozens of major retail media groups, it's going to change everything about how you think on your ad and media spend. Google opened their first physical store Facebook's integrating VR ads This is just the beginning for them. And then most importantly down at the bottom there that you've probably seen some headlines on this but the subsidize millennial lifestyle is over. Right? That was this is shot just got real for once. That was supposed to be a curse word that was supposed to be shit just got real. Normally if I wrote Shai

Aaron Conant 50:45

Michael we made it PG

Michael Zakkour 50:46

did that. Oh, okay. Did you really I don't care. You know, Ober is more expensive food delivery is more expensive. Airbnb scooters, everything. Basically, these companies now are saying, we need to make a profit. It's going to be on your dollar and not our VCs. Next, please. Okay, retail metaverse. For the most part, the biggest question about the metaverse that I get is what is the metaverse? Right. What is the metaverse? There are a number of answers out there. But the one I like is this. We've all been living in the metaverse for 20 years. Right. What we're doing right now what we're doing every time we go on a website, you are in a metaverse because it's all connected. So if you think about solar systems, galaxies, and universes, the metaverse is the connection of all those universes. The difference between what now is happening, what's coming is that everything will be in three dimensions through dimensional mirrored world. Okay. So some examples, some of these just set up their first virtual gallery, right? So you can walk into some of these you can look at the products that are going up for auction, and they have their own gallery down below the second visual you see there is that's Gucci teamed up with Roblox say that to yourself again. He teamed up with Roblox, right, we're talking about a company that didn't even think the internet existed five years ago. Right? And so now you can actually go into Roblox in a mirror and Gucci gallery. And all the merchandise is there. For now, you can buy an NF t format, but basically it's setting the template for buying physical merchandise. Now imagine also shopping a perfectly rendered Walmart, okay, 3d, you walk in, and you're walking through a Walmart store. Now, one of the things we've lost in eCommerce is serendipity and discovery. Because 90% of the world where we're told we should buy is because an algorithm is saying show this to Aaron, show this to Michaels show this to Sam, right. Now, imagine walking through a fully mirrored 3d store, where you're walking the aisles, you're looking at the end caps discoveries there. So we're going to start seeing as a mirrored High Street shop, the mirrored mall, the mirror department store. Imagine, you know, if you're inside playing League of Legends, and you can step into a 3d fully rendered Best Buy or GameStop to get some gear. So the essence I'm sorry,

Aaron Conant 53:57

no, I'm just a green. It's amazing. We have to Yeah, about 30 seconds we get to wrap up. But I think what's lost in a lot of cases is people think of like a I've seen Roblox or something like that. And it doesn't quite look real. But the new 3d ar VR, we're approaching near reality right now, if you go out to like a Crate and Barrel and you take a look at their furniture section, and you're looking at it, most of the images there are rendered images, they're not even they're not. They're not visual, they're they're generated images as a whole. There's a I actually have a slide here we see a really cool company called three kit, thr kpit. that renders near real your eyes can't tell the difference on products, direct to consumer site, but I see that we're like

Unknown Speaker 54:45

right at time. It just had one more slide and I'll close out. Okay. One more. Okay.

Michael Zakkour 54:56

So just to wrap all this up when we talk about ecosystems, and When we talk about the new retail model, this is what it looks like mapped at the center of your universe is unified commerce, which is also known as consumer centricity. And you have four power sources for new retail, unified commerce, all things commerce related, all things digital related, all things supply chain related, all things meeting entertainment related. And then you have the moons around each of those when you connect the moons, and then you connect the four power sources. Everything I just described to you becomes possible. And that's the future.

Unknown Speaker 55:37

It's awesome.

Aaron Conant 55:40

Thanks for your time today. Thanks for taking a quick break from from your vacation up there at Lake George, thanks, great friend and partner of the network. I encourage anybody you have follow up questions, you know, in connection with Michael, he's kind of the go to person across the the network here, the BWG Connect network for literally, you know, 100 brands, it's so a person that you love to have in your back pocket and he's all around great person as well. So we're the conversation encouraged anybody to do it. Michael, thanks again for your time today. Take care, enjoy your vacation, and I'm sure we'll get a nice review for listening. Bye bye. And a bunch of content we didn't get here. But if I will get to everybody the slide deck for sure. Awesome. So thanks, Michael. Here. I'm going fishing. See ya.

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BWG Connect provides executive strategy & networking sessions that help brands from any industry with their overall business planning and execution. BWG has built an exclusive network of 125,000+ senior professionals and hosts over 2,000 virtual and in-person networking events on an annual basis.
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