Thanks to our sponsors
The year of 2020 has been challenging and at the same time, provided a chance for some opportunities for growth in the eCommerce space. We asked Chris Lema to come back to the show and reflect on the year so far, with both perspective and insights. Together we take a look at the bigger eCommerce space and then narrow it down to the Woo builder community. You’ll find a lot of gems in this one.
A Chat with Chris
In episode 76, Jonathan and I chat with Chris about:
- 2020 and thoughts on the eCommerce space
- Opportunities in the space— despite of the challenges
- Some of the challenges that presented themselves
- How builders are handling the growth in the interest in online selling
- The twists and turns that come with streamlining the opportunities
- What Chris expects we will see this Black Friday
- How builders can help Merchants navigate the myriad of hosting options
- What he has seen happening in the subscription space over the last several months
- Advice from Chris for devs entering the WooCommerce space to build sites or products
Connect with Chris
Jonathan: Welcome to Do the Woo Episode 76. I'm your co-host Jonathan Wold, and I'm here with the fantastic BobWP. Bob, how are you today?
Bob: Hey, I'm good. We got a little bit of a wind storm here, so I always cross my fingers. Of course, we have wind storms all the time on the coast. Is the electricity going to go out, Bob disappear suddenly? That only lasts three or four months, so it's no big deal, ha.
Jonathan: I think we may have the same thing happening over here, because I'm only a few hours away from you and it's pretty gnarly outside right now as well.
But the Internet's working? That's what I tend to care about the most.
Bob, how's the launch been going?
Bob: Good. A lot of good feedback. Yeah, actually pretty amazing feedback. I mean, a lot of people are really excited about it. A lot of people want to get involved. I had a few new Do the Woo friends.
Jonathan: I think it's worth saying as well that you did a lot of it yourself, which I was pretty impressed by. Did you get your fill of working on websites?
Bob: Yep, I don't want to build another website for approximately seven years. I've set a new goal, so I'm not going to touch that again.
Well, before we have you introduce our guest, I'd just like to thank our sponsors, WooCommerce.com 4.6 came out. Just a lot of good stuff going on over at WooCommerce. If you missed all the good stuff on WooSesh earlier this week or just the last couple of days, you can go over there and get the recordings. Join Brian Richards and WPSessions and he'll get you lined up. So visit WooCommerce.com.
We're excited to have a new sponsor, PayPal. Yay, PayPal. Anyway, what can you say about PayPal? PayPal is PayPal. I mean, we're all using it. One of the things I'll be talking about and we will be talking more about during their sponsorship is their Pay in 4, that lets customers pay for their purchases over time and for interest free payments. They introduced that a little while back, kind of a cool thing. I'll actually be telling you more about that a little bit later in the show.
Jonathan: What I love about PayPal is they have been here a really long time in the space. Many of us have done eCommerce installations on PayPal and they're continuing to do new things. So there's a good continuity that's there. So that's been great. I'm happy to see them involved in this community space. And they're a big part of the eCommerce ecosystem.
Bob: I totally agree with you. I'm looking forward to having PayPal as a partner and learning about a lot of their cool stuff going on.
So let's go ahead and get started with this show. We have someone that I could say, well, maybe many people don't know our guest, but that would be very untrue. So Jonathan, why don't you introduce our guest?
Jonathan: We've got Chris Lema, who needs little introduction in this space. Chris has been contributing valuably to the WordPress ecosystem since... Was it 2005, Chris? It's been a long time huh?
Chris: Yep, long time.
Jonathan: You know the space well. You've been involved in a lot of things. Today, amongst the many things that you're doing, you're serving as the VP of products over at Nexcess/Liquid Web.
Jonathan: Yeah, so thank you for all that you're doing there and thanks for joining us today. It's great to have you.
Chris: It is great to be here.
Jonathan: We started out with the weather. How is the weather in your neck of the woods currently?
Chris: I think in Houston, which is where my house is now, it is warm. I am currently in Atlanta for a couple of business meetings and it is not what you would call cold. Either way in both these parts, we're not seeing the storms that you guys are seeing up in the areas that you're in. I think we're good. But the truth is, I spend most of my days indoors, right? So I actually have to venture all the way to a window and look outside to know what's going on.
Jonathan: Both the downside and the upside of being able to have a flexibility to work where you want to work, right?
Jonathan: Excellent. Well, Chris, it's always great to have you.
Chris: It is great to be here. I'm wearing purple, but not because of WooCommerce and not because I just did a session on WooSesh, but because the Lakers won their championship and I've waited 10 years. So all week is a purple week. Every shirt I'm wearing this week is all purple.
Jonathan: It's a good week.
A first look at the ecosystem in 2020
You've been in this ecosystem for a long time. You've seen a lot sort of come and go. This particular year seems especially loaded. There's been a lot happening.
Chris: Yeah. Basically, if you're an analyst for eCommerce, every one of your projections was wrong, right? Because you know how people do their projections, right? They're linear progression, line just keeps creeping. Whoever said, "Oh, well, I think that in 2020, we're going to see eCommerce grow by whatever the percent you were thinking." I think we were seeing eCommerce in the US moving a couple percentage points every year. Whoever predicted 2020 was way off, right? They were just like, "Oh my God! What's happening?"
McKinsey was like, "Oh, we've seen 10 years worth of growth in three months." So nobody was ready for this. There's been a lot of downside in a COVID related space; businesses closing, families hurt by unemployment, people not able to pay rent. I mean, the list goes on and on of all the negative things. The one, maybe silver lining in all that has been massive growth in eCommerce. Adoption in every form and every trend. And so if you're in that space, that's been the good news.
Opportunities seen in this space
Jonathan: So Chris, you've been in this eCommerce industry for a bit. And for those of us just kind of looking broadly, it's easy to see the growth, and it's easy to see that there's a lot happening. From your vantage point though, being at a company that does manage WooCommerce and having good connections in the product space, has there been anything that stands out to you, particularly in terms of maybe some of the opportunities that you're seeing in this space or some of the challenges? I'm just curious what you've been seeing over the past six months or so.
Chris: What I've seen mirrors what we're reading about in the industry trade mags and everything else. I think we've noticed that there is very little brand or store loyalty out there, right? When you get caught and you don't know where to buy toilet paper, you stop worrying about brands, right? Or if you always buy at Amazon and all of a sudden Amazon delays its shipping timelines, you start buying at other places, right? Walmart was like, "Thank you for being you, Amazon. We're happy to drive this."
But it wasn't just the big box retailers, right? It was everyone under the sun. So we've seen stores, we've seen retail, we've seen folks who have just pushed into a space that was previously owned and dominated by one 800-pound gorilla. And it's dispersed, it's distributed.
People are making money online even if they're not the biggest name, because brand loyalty is not what we expect it to be. So we've definitely seen that. We've seen a lot of requests come into us as a host and who does manage WooCommerce hosting. Requests that we can't perfectly solve for groceries. "Hey, can we host a grocery store online?" You're like, "You can, but there's a lot more to it than the website. You got to worry about inventory. You got to worry about shipping." I mean, it gets complicated pretty fast when you go all the way out to groceries. But online groceries is one of the biggest growth components that we've seen, right? Both grocery and what we've seen out in the rest of the data points.
The US and Portugal had super high growth in that, right? And I'm like, "I don't know what US and Portugal have in common, other than they both enjoy wine." But you're like, "Wow! Okay." We're seeing massive growth in that space. We're also seeing that for every store that closed down... And again, as a hosting company, we get those phone calls where people say, "I can't run it anymore. I got to close down."
For every store that was closing down, every website that was closing down, we saw one or two stores that popped up, right? People were attaching eCommerce to a previous non eCommerce store. You might've had a blog, now you want to merchandise it with a T-shirt. You had a physical store, now you want an online store. We've seen quarters of this now; of definitely more closing than we've seen on a normal basis, but massively more growth and openings than before.
The challenges and risks 2020 has brought to the ecosystem
Jonathan: One more question I'm curious about in this vein of thinking, so we see a lot of opportunity in the eCommerce space which is generally sort of a positive thing, but what are some of the challenges or risks that you're seeing to folks in this space?
Chris: Oh, yeah. I mentioned Amazon a little bit ago, but I'll tell you, we started working with ShipBob, one of our partners, because people who had previously counted on Amazon for their fulfillment services, were suddenly told, with almost no notice, "We are not going to accept your shipments anymore."
What Amazon did to mitigate the fact that so many people were buying household items that were cleaners and those supplies, they couldn't maintain that while accepting all the rest of the inbound stuff that was going to be for Amazon stores. So you can imagine, right? We've had five years of people telling anyone who will listen, "You should spin up an Amazon store. You should use Amazon buy fulfillment. You should do." On and on and on.
So let's say that you finally bought into that. Okay, great. You send a whole pallet of your products to Amazon and Amazon says, "We're not accepting it. And by the way, for whatever you have in stock, we're putting a delay on it because we're shipping these other things." We redirected a whole bunch of people to ShipBob and ShipBob opened up thousands of square foot of new warehouse space and just started processing stuff, right? And it's hard when you count on the main player, and that main player is external to you, right? You count on someone else, and then they change rules on you, which they were doing for their own good reasons and I get it, but it can affect your business dramatically.
The tidal wave of people who want to sell online and how if affects the builder
Bob: One of the things I was wondering, Chris, has this added this layer of stress on agencies? For example, all these businesses that are hurting right now and they want to go online. And some of them, it's a natural segue, "Yeah. Hey, we'll do it." But then I imagine a lot of these agencies are getting people coming out of desperation. "I have this physical brick and mortar store. I need to get online." The agency's looking at their business and thinking, well, that's going to take some creativity because obviously not everybody you have can adapt to online. Have you heard that from the agencies that they're getting more inundated?
Chris: Yeah, we're seeing pressure in a lot of different ways, right? One pressure is, we need this up fast. We need it faster than we've ever asked before. I don't have nine months to get something up and online, right? If you're talking about a really big and complicated WooCommerce or a really big Magento store, and the agencies are like, "This is our normal process. We'll do it in six months." And so there's pressure on an agency that says, "Tell me what you can get done in one month or two months. I need this up fast." So there's that pressure.
Second pressure is, some of the folks that are asking for this stuff have fixed budgets, right? You're asking for some of the most complicated stuff at some of the most inexpensive price points. And that applies pressure to agencies as well, right? And some of the best agencies will regularly go into, "Well, let's do a phased approach. Let's get you up and do phase one, and then we'll use the revenue from phase one to put into phase two." And so there's definitely ways to manage it, but they're seeing the second pressure, which is price points, right? The first is timelines, the second is price points.
The third pressure is that... And it's not different than we've ever had. It just becomes more pronounced when those first two pressures exist. And that's when agencies are asked to do things that, frankly, they're not even sure they know how to do, because Amazon's doing it or Walmart's doing it, right? Imagine you're like, "Hey, I want to spin up an online store." "Okay, no problem. We can do that." "Well, and I want it to have inventory and track it based on both what's being sold online, but also what's being sold offline in the physical premise." You go, "Okay, that's a little hard, but we can do that." "And I also want to know what parking spot you just pulled into so that I can make sure to deliver your order to the right parking spot." And you're like, "Wait, wait, wait, wait. How do we get the parking spots?" You're like, "What? Okay, hold on." "And then I want a mobile app that will let me check in to the parking spot and give you the spot when I get there." And agencies are like, "Okay, we're going to have to think through this. This is not something we do every day."
I think agencies are feeling three different kinds of pressures. We're hearing it, we're seeing it. And of course, that doesn't stop the normal pressures like, "I want it fast. How do I make it faster?" That's an everyday dynamic.
Thanks to our sponsor PayPal. In time for the holiday season PayPal has launched a new pay later option called Pay in 4. This mean that your clients can offer their customers the option to purchase over time in 4 interest-free payment. This feature is one of two option from PayPal for pay later with the other being PayPal Credit which gives store customers more purchasing power through flexible and transparent choices in how and when they pay. This second option is subject to consumer credit approval.
So offering those payment options is good business. Did you know that 64% of consumers surveyed say they are more likely to make a purchase at a retailer that offers interest-free payment options. And 56% of consumers that responded agree that they prefer to pay a purchase back in installments rather than use a credit card.
Well, this seems like a no-brainer to me. Clients can grow their sales and get paid up front with no additional risk or cost.
All you need to do is download the PayPal Checkout extension on the Marketplace at WooCommerce.com. Just head on over, click marketplace and search for the PayPal Checkout. Suggesting that to your clients will certainly open up sales opportunities for them.
Thanks for PayPal for being a community sponsor at Do the Woo. And now back the conversation.
Jonathan: What's interesting about that challenge too is that, because of the distributed nature of this ecosystem, that question is being asked of different agencies at the same time, right? The grocery store has been a great example of that. I want to be able to park in this spot. And if you zoom out, you say, 'Okay, it makes sense and it's also plausible." But then because it's not centralized, you end up having this frank reality that multiple people are working on the same thing, and there's some diffused effort there which has advantages but it also has disadvantages when it comes to speed. You guys are in a position where you get to see more of these types of things coming together.
Streamlining the opportunities
So I'm curious about how you as a host, think about the opportunities here because you want to continue to play to the strength of WooCommerce on WordPress as this distributed ecosystem where people have choice yet at the same time, there's opportunities to help streamline things. So I'm curious, how do you think about that when you see all these?
Chris: It's a tight rope we walk every day, right? Let's say you come and bring a website onto my platform and you are like, "Hey, this is our WooCommerce store and it's on our platform." And then you say, "Huh, it's not as fast as you promise it would be. You said it would be fast and you gave me the whole pitch on why I should host it over here." And I go, "Yeah, it should be really fast." So I'm like, "Let me go look at your site." And you're talking to the agency that built the site, right? And the agency has built code that is not sound. What do you do, right? Do you say, "Hey, your chief technology officer or your chief architect or your senior engineer didn't do this right"? That seems like a hard message to pass.
On the flip side, let's say they just spent money buying a plugin and you go, "That's maybe the 30th version of that feature that I would choose. I have three others I'd choose first." So we are in this constant, how do you define managed in managerial commerce hosting. And we believe that the answer includes some really honest and frank feedback, but in the context where you've asked for it, right, or in the context where we might give you a light note like, "Hey, we noticed site is performing slower than we would expect. We dug in a little, we noticed that you're having some issues with this thing." And then you leave it there and wait and see if someone says, "Well, do you have a recommendation?" "Oh, glad you asked. Here, we do." So you're doing this tight rope balance because we see code that isn't performed well, we see plugins that we would recommend others instead of them. So you do this dance of navigating that.
But every single day, we see strange things. Especially when you're talking about stores that are really over-performing, right? You don't normally see that with a store that's struggling to do three orders a day. But if you're doing hundreds of orders a day and maybe for tens of thousands of dollars a day, and all of a sudden you're getting massive traffic and things are going sideways, that's where we'll dig in. But you don't want to dig in and go, "Well, the problem is you wrote the wrong code here." So you do a dance, right, and you say, "Well, would you like us to take a look at this code?" And then they're like, "Yeah, please. I want another pair of eyes." And other people are like, "Nope, I don't need you worrying about that at all." Okay, right. You take your guidance from the folks that are hiring you.
Jonathan: There's an interesting tension that's there, right? Because part of the value proposition, when we see folks move over from say, Shopify to Woo, there's this, "We want the autonomy. We want the flexibility." With that, comes the freedom to do things that can mess your stores up.
Jonathan: You want to maintain that because if you just take a lockdown approach, you're doing the same thing and playing a loop game. But I like that. It's a tight rope, right? You can sort of nudge and gently point like, "Hey, you want to do this?" Some people want it, others don't.
Chris: Yeah, we're working on a feature that will roll out next year, where we can tell you what the potential cost of each plugin that you activate has on your site. Let's say you wanted to add a pop-up and you thought that pop-up would generate 10% more add-on revenue. And so you're like, "Okay." Well, your average order value is $150, and you think with this pop-up you can get 10% more. So it's 15 bucks and you do 10 orders a week, so 150 bucks a week. That's money, right? But if I show you that it adds three second delay and that will take 50% of your sales away, we should be able to do the math for you and do that calculus and say, "Do you really want this pop-up or not?"
Chris: So it gets a little complicated, but we're working on that to really help redefine what manage means and to help our merchants.
Jonathan: It sounds like you're going for an approach that's really about helping them make better choices.
Jonathan: So you can show them those costs. If you can show them where like, "Hey, this is what we think. This gives you some perspective. You're making the choice. We're not doing it for you, but we're helping you make better choices." I love that.
Chris: It helps you run down that tight wire that's right in between being too restrictive and too free, right, that you were just talking about. You're like, "How do I educate?" Even if the education isn't the merchant or the the store owner, it might be the developer. But we interact with developers who didn't know there were three versions of this plugin or three versions of this feature, didn't know that one of them was way better than the rest, right? And so you want to be able to go, "Okay, let me give you the data and then if you still want to run with it, that's okay. It's your car."
Jonathan: That's great.
Black Friday, what is to be expected
Bob: I'm going to flip over to another subject. I had this question I thought of before we got on here. Black Friday's coming up. We're not going to talk about prepping for that because hopefully everybody's been working on that for a while. You see the predictions just generally out there, "Oh, it's going to be explosive. It's going to be amazing."
Let's go to the WooCommerce builder that builds products and does extensions. Things like that, SAS, whatever. When Black Friday rolls around, what do you think that it's going to be for those particular products in this very niche? Is it going to be a big boost? Because what we have is, we have two audiences for them. One is the store builder, and one is the regular consumer, DIYer. That might be new to the space. They just build a site they don't really understand. Okay, I can get this deal where somebody else is a little bit more attuned to looking for them. I say, "Oh, I'm going to wait and get this." Do you think for those businesses, Black Friday is going to be business as usual? Do you think it's going to be a bit more because people are jumping on the eCommerce bandwagon or is it going to be huge... What do you think is going to happen? Or is there even any way to give any prediction?
Chris: I think the only prediction I can tell you really seriously about Black Friday and Cyber Monday, is it's going to be up, way up, super up, and most sites will fail, right? Honestly, if I were owning a store today, right, I would tell you that last month was the time when I should have bought more infrastructure, where I should have been only focused on scale. We launched some new auto-scale features last month, specifically for this, right? Because we're like, "Hey, if you're not thinking about the massive traffic load and scale in September and October, it's too late when you get to November." It's going to be silly when you call on Friday and go, "There's a problem with my server." I mean, every host will help you, they'll try and do what they can, but that's the wrong moment to do it, right?
So it will be up, way up. We know that eCommerce in general is up. We know that transaction dynamics are up. We know that we've seen between the folks that bought significantly more, and the people who bought slightly more, we're talking about more than 60%, right? 50 to 60% of the people fell in that category of, "In this time we're buying more online than anywhere else." And we know that when it comes to that particular weekend, stores will have the broadest, most significant discounts that they've had all year. You don't have to be a genius to be like, "We're going to see unprecedented numbers." But it won't matter if your website's down, right? It won't matter if just congestion has killed you.
Jonathan: It's worth pointing out here too this is one of the softer spots within WordPress and Woo because if you go with a SAS platform that is typically, due to various degrees of success, abstracted out, they're handling the infrastructure. Whereas with WordPress and Woo, you do have to think about that or be working with a host who's thinking about it for you or like, "We've anticipated this, we're on top of this."
Chris: It's no good. I mean, if you're with a inexpensive host, right? And by inexpensive I mean, less than $10 a month. And I know we have a promo right now that one of our 19 dollar plans is at nine. Generically, I'm not picking on a host, but if you're spending three, four, $5 a month in hosting, you are in a environment that is likely highly loaded onto a single server, right? It's high density shared hosting. And if you're in high density shared hosting, one of the sites out, of a thousand on that server, could have a really big run and every other site on that server is going to feel that pain. Even if you didn't do anything, right? And so when you're in that environment and you call up and say, "Hey, I'm not doing good. I want to move or whatever," you're talking about a migration. Even the best companies, it'll take you a day, two, three to migrate an eCommerce based store, right? It's not the same as running HTML from one directory to another.
Jonathan: There's a lot of complexities to it. Are you going to take your door offline during that? You kind of have to.
Chris: It gets really complicated, really fast. Our auto-scale gives people 24 hours and they don't have to be continuous. 24 hours of high traffic events, where the PHP workers, the maximum concurrent threads, you get the next plan up. You get it in your plan for 24 hours for free, right?
Thanks to our sponsor WooCommerce You may be just starting your journey as a Woo Builder or well into your journey. Or perhaps you have WooCommerce talents that you want to bring to a team as you look to make a switch in your career.
WooCommerce has several roles open that will likely fit your own goals of growth. You will be joining the larger Automattic team, a diverse and distributed group of individuals with a passion for WordPress, and yes, WooCommerce.
If you want are looking for make that career pivot and love working from home, check out all their open positions over on our Job Listing at DotheWoo.io.
Trust me. I know the company and a lot of the people. It's a smart move.
Thanks to WooCommerce.com and their support as a community sponsor. Now let's head back to the show.
Builders, hosts, merchants and navigating the waters
Jonathan: Chris, the thing I'm curious about, the most of the people listening are builders themselves, right? I love what you guys do. There are a lot of hosts out there, a lot of options. How would you advise builders and developers, design folks working with merchants to help them navigate?
Chris: The first phone call I'd tell you is call the host and ask, what kind of scaling solutions, what kind of growth can you handle if my site gets this traffic, right? Tell me blatantly. Now, some of those hosts will tell you, "I have this in place, or I have that in place." Others would say, "Well, we would recommend that you upgrade to another plan." And you may legitimately want to move to another plan.
But then the next question is, "Great, let's say I move to that plan. What are the capacity challenge?" One of the things that we flipped on when we started working on this a year ago was, we had to stop talking about PHP workers, concurrent threads, et cetera. And we talked about maximum concurrent traffic, right? We started changing the language that people could understand, right? If your store has never had a hundred people on it at the same time, that may be your max and someone else maybe have a thousand at the same time.
We just talked to a customer a day ago. Talked to a customer who every single time they send out an email with Klaviyo, every single time to 10,000 email subscribers. Not 50,000, not two million, but 10,000. They see thousands of clicks back to a single page within a three-minute span of the email going out, meaning everybody immediately opens the email and clicks the link. Thousands of people hitting the same exact page at the same exact time. And of course, if that's a product page and you have 30 dynamic queries running, you're going to slow that thing to a crawl. And that's on a regular day. That's not on the Cyber Monday weekend, right? So that's where you say, hey, if you're a developer, get on the phone with the host. They should be your partner, not just a vendor, right? Talk to them, ask them about capacity planning, ask them about growth and scalability. They may tell you right off the bat, "You need to be on a different plan if you're in growth."
Jonathan: And if you don't do this stuff now, you're going to have a pretty unpleasant holiday because your customers are going to be calling you. They're going to be like, "Hey, what's going on?" Even if it's the host's problem, as a developer, you're in the position to be able to be advising folks and anticipate and it's like, you know it, you can see it coming. Cool.
Chris: If the host offers you an ability to review the code base, review the products on your site or whatever, if you're a developer and the host offers a second pair of eyes, I would take it, right? We have some partners who are really serious hardcore eCommerce store builders and even with all their expertise, they're like, "Oh, yeah. Hey, take a second look." Because we see it so often, because we touch. And we see the tickets very often, right? And this is every host, right? Every host sees this; tickets, tickets, tickets, and eventually you start seeing patterns. And when you see that pattern, invariably, if you're a developer and you're like, "Hey, can you take a second and look at this?" If your host provides it, I'd take it. Because if you're using something that they know is going to give you a hiccup under heavy load, find out about it now, not later.
Jonathan: It's great to think of them as a partner.
I'm curious to switch topics to subscriptions.
Chris: Oh, yeah.
What about that subscription thing?
Jonathan: There's a lot that could be said about this, but I'm curious for your thoughts and just the broad opportunities that you see in the subscription space. What are you seeing right now?
Chris: Man, subscriptions, it's huge right now. When we talk about subscriptions, often in the WordPress space, we're talking about regular payment for content protection. Content protection, like a membership site, is only one kind of subscription, right? We just have to be like, "Okay, hold on a second." When everyday people talk about subscriptions, they're not often talking about access, right? They're often talking about curation or replenishment, right? They're talking about the Dollar Shave Club. I think it's called Dollar Shave. And then curation might be Blue Apron or Stitch Fix, whether you're talking about clothing or you're talking about food; where different people are getting different products delivered to them on a regular basis based on some level of decision-making and recommendation, right? And all of that is up into the right.
Women have more subscriptions than men, broadly on the gender base, but men have more number of active subscriptions than women on average, right? 28% of women have three or more subscriptions. 42% of men have three or more subscriptions, right? And so that's always interesting, even though you're like, "Well, but women have more." And your like, "Backup, hold on a second." It depends on what we're talking about and it depends on how they're using it.
One of my favorites as a shift in dynamics with subscriptions, is a company called Thread. If you haven't looked at Thread, it's really interesting because while it's not a subscription exact player, it's fighting the subscription players. We all know those companies that have clothing in a box, right? And especially for men, it turns out. I don't know why it took this long, but eventually we realized that men don't know how to dress, right? And so finally someone was like, "Well, what if we just hire one stylist who creates different styles, puts the clothing in a box, ships it to you, and we just tell the men to wear?"
And boom, right? We went from one clothing subscription box company to 17 in less than 18 months. Men are thrilled, right? I'm a guy who's in a lot of airports and it's crazy when as people are walking by, I can go, that's this company, that's this company, right? Because they're all wearing the same outfits, right? But Thread did something a little different. Thread was like, "Okay, I want you to come over here and fill out your profile." And now I'm going to have a person who is a personalized shopper, who's going to read your profile and then make recommendations to you. And then I'm going to see the recommendations and choose which things I want or don't want. And I can buy them in a box, I can buy them in a kit or I can buy each one individually. Or I can just rate them. I like this, I don't like this.
This is the notion of personalization in these subscription models. And it's huge, right? This ability for deep curation in a replenishment or product delivery on a regular basis. It's massive and it's interesting. I think it's the way of... We're seeing people adopt subscriptions more than not. And that's always interesting too. When you see subscription numbers go up, you got to understand it's counterintuitive because most of us hate the idea of recurring charges, right?. We hate that I have to buy something on a recurring basis.
So the product I have to buy has to be super amazing for me to get over the hump. But when they deliver real value, right, and to see the numbers growing, then you got to be like, "Okay, well, what do I got to know about this?" And it turns out, whether it's media, buying access to downloads and stuff, or whether it's product replacement, or whether it's curated products, it's growing and it's worth people thinking about. For the longest time in the WordPress ecosystem and even in the WooCommerce ecosystem, it was mostly just access.
Jonathan: Yeah, access.
Chris: I think the model is starting to shift towards replenishment. And then when you start adding personalization, man, that's an incredible play.
Jonathan: On the Woo side of things, subscriptions is right up there in terms of, what's most popular and what people are doing. And what I've loved personally to see is just the variety of builders who are coming in and building new plugins, new extensions, new themes to offer that. There's so much flexibility there, which has its downsides as well in terms of so many options to parse through. But I love seeing that. I'm looking forward to seeing more sort of streamlined.
All right, if you're going to do this type of business, you do that, but here's the plugins that you're going to want to use. Here's the piece that you're going to want to use. I just see a lot of opportunity where some of these SaaS platforms are a bit limited. They have to pick the most popular one and sort of go that path whereas with Woo, you can have a lot more. This niche is focused on this type of business and this is the pack of plugins that you use in this over here.
Chris: Yeah, you could not build what Thread has built. You cannot build it on one of the standard hosted platforms, just not going to happen. The level of engagement, interactivity, the flexibility you need in the business model, is not going to happen on SquareSpace. Even if they're now getting ready to start implementing... Oh, sorry. On Shopify. Even though they're now getting ready to start their subscription piece, they've always been hammered by the fact that they can't do it. They're going to roll out their first one. It's interesting, but it's going to be plain Jane, right?
And most of the hosted platforms deliver a very plain simple version of this. And that's where you're going to go, "Nope, it's a different model." You need flexibility. The only place where you could do that today with hosted would be BigCommerce, where BigCommerce has enough of an API that if you pay for the enterprise side, you can basically run headless on BigCommerce and build anything you want. But WooCommerce and Magento are both places where, because of the open source nature, because of the community around it, you can build with flexibility, the kind of experience you want to have.
Building entering the WooCommerce space, first step
Bob: All right. Well, I have one last question. I don't know if you have anything else you want to touch on, but let me just swing this your way, Chris. A little bit of a Chris' advice here. So everybody I'm talking to, and probably everybody both of you talk to that are in the Wordpress space, building both products and agencies doing websites are saying... I see everybody when I say something about eCommerce, "Oh, I'm just starting to get into that. I'm starting to do more WooCommerce sites." Everybody wants to get in on it. I mean, it's obvious why they want to do it. I imagine for both of them there, it's a little bit different. But what's your initial? If somebody is saying, "Hey, I've been doing WordPress stuff for a while. I've been building WordPress sites. Now I'm ready to jump into WooCommerce and I'm going to start doing that for clients." What's your very first piece of advice you give them?
Chris: So first of all, let me just say that it's wonderful that we're seeing WordPress folks who are getting into eCommerce. For many years, They didn't. They didn't touch it. They were like, "No, no, it's complicated. I don't know that I have the technical chops to do it or it's complicated. I don't know if I have the insurance premiums to handle what happens if a customer sues me. I don't want to be in a mission-critical business." And no matter what I would tell them, right? "You can do this. You have the skills, the tools are there. This is great. You're going to have a great time." People were like, "No, no, thank you." And I think we're finally at a place where people are going, "Hey, I think I can do this."
You interviewed one of my good friends who, without calling her out, she was like, "I can't. I can't build a WooCommerce store." And then all of a sudden she did and then she's like, "Oh my God! Now all we do is WooCommerce store." And you're like, "That's great. I'm glad for you." So very happy that people are starting to embrace it and get into it. The first piece of advice I would say is, make sure that you have a really deep and robust conversation with the customer, right? That more often than not... And I gave a presentation at some point with 40 questions to ask for an eCommerce project before you scope it or price it. I'll find the slides, I'll send it to you somewhere.
But what I know is that it's different. If you are just getting started with eCommerce, there's a lot of stuff you forget to ask about. And so you ask two or three questions, you get super excited, you know you're going to use WooCommerce and you put out a quote and you're like, "Okay, that will be $6,000." And then in the middle of it, the customer says, "Well, how do I interact with Salesforce?" And you're like, "What?" Or, "How's this going to work on my TradeGecko inventory?" And you're like, "Huh, that wasn't in the quote." You don't want to find those things out by accident. So the most important thing I'd say is, step one, get your list of questions ready, right?
I had a friend who wanted to build a membership site the other day. And I said, "Hey, can we have a call?" They were going to talk to an agency. And I said, "I love that you're going to talk to an agency. Can you and I have a call first, before you have a call with the agency?" They go, "Sure, what are we going to talking about?" I said, "I'm going to give you all the questions you have to ask yourself.
Here's all the questions you have to ask yourself. Do you want this? Do you need this? Do you want this? Do you need this?" And we just went through 40 questions or maybe 20 questions before she went, "Wow! I hadn't thought about any of that." I'm like, "Right, and the problem is, your agency may not ask the question, and then you're going to ask it 13 weeks into the project." And then they're going to say, "Well, we have to redo everything we did because we didn't know you're going to ask that." It's what I call marinading in the problem space. And most of us want to jump to the solution way too quickly. You got to marinate in the problem space.
I'm from California. We don't really know barbecue. We grill. That means we put food on a grill and wait a certain amount of time then we take it off. The barbecue people know this. If you're going to marinate, you can't just take meat, throw it in a Ziploc bag, throw some liquid in it, zip it up, put it in the fridge, wait an hour and take it out. That's not marinated. And yet, unfortunately, that's what people do when they start doing a discovery process on a eCommerce project. If they're new, they just ask a couple questions. Great, they've isolated which extensions they want to use, and they're off and running, and they haven't marinated in the problem space.
Time to sell products in the Woo space
Bob: So how about somebody that wants to start selling products in the WooCommerce space? Any little bit of variation. I'm sure it's knowing your customers, but-
Chris: I would tell you, do not make your target audience a developer. If you're trying to build a product in the space and you want to sell that, do not make it so that you're selling to developers. Because every developer who looks at your product, is going to say the same thing in their head. They're going to say, "I could probably do that in two hours." Which means, even though they couldn't, it means that they're not going to have the value on the price point, which means it's going to depress your price point, which means it's going to depress your revenue.
And developers are going to immediately go, "Well, it's just this. Or you just have to do that." And I'm not saying developers are bad. I'm just saying, if I go to a contractor friend of mine and I start talking about building something, they're definitely going to be like, "I don't need you to do that. I can do that." The fundamental dynamic is, it's not magic to them, right? So if you want to solve a problem, solve a problem for a customer who doesn't know how you do it, and who says, "I need that, and I'm willing to pay for it." If you sell a tool to a developer and the developer goes, "I could build that myself," you're going to struggle to sell. You're going to struggle the close. You're going to struggle to get the premium price point.
Bob: Well, as always, fantastic show, Chris. I know whenever I get you on a podcast and I've had on a few different ones, we could just talk and talk and talk. So that's why we keep having you come back.
Chris: A lot of fun.
Connect with Chris
Bob: All right. Let's see. First of all, before I thank the sponsors, where can people connect with you, Chris?
Chris: I am @ChrisLemma, C-H-R-I-S-L-E-M-, as in Mary, A. @ChrisLema on Twitter. And I think I'm Mr. Chris Lema on Instagram, YouTube and LinkedIn. You can find me in any of those places. Also, you can read riding my blog posts @chrislema.com and I also have several blog posts email@example.com. You can find me online just about anywhere.
Bob: Cool. Well, I'd like to thank our sponsors again. WooCommerce.com of course, that's what we're here for. We're here for WooCommerce and that's what we've been talking about for 45 minutes almost. So WooCommerce, you got to love them.
PayPal, remember their pay later offers your clients a chance to get paid up front with no additional risk or costs. So that might be a good recommendation for that next project.
Visit dothewoo.io, that is our new site. Been up for about not quite a little bit over a week or two. Is it just one week? I think. Oh my God. It is just one week. Anyway, it seems a lot longer than that. But do check it out and do subscribe to the podcasts in your favorite pod app. Again, thank you so much, Chris, for joining us.
Chris: My pleasure.
Sign up to receive email updates
Enter your name and email address below and I'll send you periodic updates about the podcast.