THE IMPORTANCE OF OFFERING MULTIPLE SHIPPING OPTIONS FOR YOUR E-COMMERCE BUSINESS
The importance of offering multiple shipping options for your eCommerce business: Why giving customers a choice of shipping options can increase...
17 min read
BUKU Marketing : Aug 4, 2022 1:31:59 PM
Narrator: Welcome to eCommerce innovators. A podcast that brings together the brightest minds in the industry to explore innovating strategies and trends in global eCommerce. Our host is John Labaron, Chief Revenue Officer at Pattern, the premier partner for global eCommerce acceleration.
[Music fades out]
John: Alright everyone, this is eCommerce innovators. My name is John Labaron and I’m the Chief Revenue Officer at Pattern. This podcast is all about exploring the latest technology, the latest trends and certainly meeting the brightest people in eCommerce. So, we’re thrilled to join the podcast today and have a guest in the CEO of BUKU, his name is Ken Muir and welcome to the show today.
Ken: Oh, thanks for having me, John. I’m excited to be here. These are fun to do, I appreciate it.
John: Yeah, you bet. So, tell us a little bit for those that do not know anything about BUKU, tell us about it.
Ken: BUKU is a relatively young company. We’ve been around since 2019. We focus on the experience that brands have between them and their customers for all things that are related to shipping. From in the cart when they go to check out all the way through the journey as that package lands at their doorstep. And heaven forbid, they have to return it, we help with that as well.
John: Yeah, such an interesting service. And definitely accelerated by Covid and the number of both D2C and the marketplace and everywhere in between. That is such an area of disruption. I look at, honestly even before Covid, you look at some of the fastest growing companies in this country, many of them have to do with fulfillment and logistics. It’s so complex, it’s so opaque. And I think that companies like you guys that are democratizing those rates and that information and that customer experience are definitely at the forefront of some of the growth that’s happening in the economy right now.
John: So, tell us a little about how you got there. The company started pre-Covid, but as you said it’s a pretty new company. Were you brought in as an accelerator, a little bit of adult supervision –
John: What did it look like? Why did the founders decide to bring you in at this time and how does your background tie into that need?
Ken: Yeah, sure. I am a 25-year software veteran, I’ve been doing this for quite a long time. I’m a software engineer in my heart. My passion is building great software that solves real customer pains.
Ken: This is my second time being a CEO. I led my previous company, GWAVA, to a very successful exit in 2016. You brought up Covid, but during the Covid time and really since the time that we sold my former company, I kept my eye out for a great opportunity.
Ken: And I was approached in August by the founders of BUKU. And [chuckles] it’s been a steep learning curve, but it’s been incredibly rewarding.
Because there are so many eCommerce brands that are experiencing a lot of pain in their shipping, and I love being able to help and solve those pains. And really enable them to do what they want to do. They don’t want to think about shipping, they want to build their brand and they want to drive their own businesses. That’s actually the mission statement of BUKU, is to enable our customers to focus on their business and not on their shipping.
John: Yeah, absolutely. And it can be such a drag, such a friction point. And you don’t always know what you don’t know as brand, in terms of the efficiency gains you could have, the savings, but I would say that is certainly true in our business. The biggest chunk of “our margin” gets eaten up by fulfillment and logistics, it’s just massive.
Tell us a little about, you and I chatted before the show a little bit about what it is like being a CEO this time around versus last time and I thought there were some interesting learnings there and I think our audience would benefit from hearing more around your take on that.
Ken: It is very different being a second or third time CEO. You know, people always joke about, it’s usually done in the context of a marriage, the second marriage is [laughs] to fix their mistakes and those type of things. But for me, the first time you’re a CEO, and I don’t want for this to come across wrong, but in some ways, you’re figuring out yourself. You’re figuring out, you’ve never been that. You’ve had other positions that have helped prepare you [to be a CEO], but it’s got a little element of your success in it. And when you have done that and you have a chance – done it, and done it successfully, not saying it was done perfect by any means, but you had some good success - and you get another opportunity, it’s just different.
And I don’t want it to come across as cliché, but my driver is no longer me. I am way down at the bottom. And maybe that was something wrong with me before, that I’ve had to mature or whatnot, but I truly go to work every single day for our customers and for our team. It makes it more fun, when you’re not in it really for yourself, but for others, work becomes much more enjoyable and that’s what I’ve been experiencing with BUKU. I’ve loved it.
John: Absolutely. When you think about your focus today on customers versus maybe at a previous company, and their success, which is kind of a function honestly of the business model, can you speak a little more to that?
Ken: Uh, yeah! So, in the past, in fact this goes all the way back to my previous days even at Novelle, we absolutely cared about our customers. I’m going specifically to Guava now, but we cared deeply about our customers.
We sold a lot into banks and finance, and if we did a 5-million-dollar deal with a certain bank, we always got our 5 million. We had to provide the service but whether their business went up or their business went down, it didn’t really matter.
What’s different with Pattern and BUKU is it’s different level of engagement with customers. Because their business success is directly proportional your business success. If our customers are thriving, if they are driving revenue, if they are driving the number of sales they are making online, that in turn is driving the number of shipments they are doing and thus we all rise together. It just creates this deeper bond and this deeper level of truly caring about your customer’s success.
John: Yeah, absolutely. It is a very different dynamic to move from the expense side of the ledger more to truly the revenue side of the ledger and helping those brands grow and sharing in the upside of those joint efficiencies or those joint successes and celebrations. I think that is super powerful for sure.
Tell us a little about innovation. You’re an interesting executive because you have so much domain expertise. I think you graduated with a degree in electrical engineering, you sit on multiple boards, et cetera. So that gives you this kind of insight, you have this massive track record in helping build and scale technology companies. What was your background in fulfillment and logistics and how much does that actually matter when you’re building a platform of this magnitude?
Ken: Yes, so my background in fulfillment and logistics goes all the way back to August of last year. [laughs]
Ken: But the thing that’s very important to me, and this happens a lot; often throughout my career you would find the pain point and build some great software. As a young engineer I used to think “Well what’s the problem? That should just sell itself, that’s the greatest software in the world.” And I’ve since had to learn that the most important part of that is having that deep expertise in ecosystem partners, such as Pattern, such as our warehouses, our 3PL’s and warehouse management software providers. And that’s really the important part and that’s really how I’ve shifted in innovating.
Innovation isn’t just innovating the technology, it’s innovating how you relate and how you build those partnerships and how you together drive growth in businesses. And that’s really been my excitement in joining BUKU is that I knew I had those industry expertise.
Yeah, we got former online sellers, people who have been a part of MLM’s and have had to deal with shipping, we have DHL, FedEx, UPS, former VP’s and executives, they are all there. They just needed some help with the software, and I’ve been able to bring in a fantastic team and leverage my expertise and that’s really what has transformed us and turned us into a major SaaS provider within the eCommerce shipping space.
John: Yeah. I love it. Well, I’ve got to imagine you have a bunch of different types of customers. You mentioned your "go-to" market, there has been a bunch of innovation there in terms of how do you scale the business while leverage these partnerships or routes to market. Maybe that’s an area we can ultimately explore as well. What does that look like? You are this engineer, but you’ve had this long career as an executive as well as running sale teams, et cetera. Were those routes to market already in place when you got there or is it something you’ve been pushing to get the company to grow faster? Tell us more about that.
Ken: Well, it’s a natural piece. So, our technology has something that’s very important. We’ve got our end cart which we call our “Checkout CX”, and “Customer Checkout Experience” and we make the shopping cart the source of all truth and that is a unique differentiator. And what that means is that we better be – I’m waving my hands and realizing that this is an audio podcast…[laughs]
Ken: It’s probably not an effective thing to do with my hands [laughs]. We drive down ensuring that all the way through fulfillment whether it’s the warehouse rates, or our rates, customer rates, all the way down to what’s actually being charged by the carrier. We have to build those partnership and make sure that what shows in the brand’s cart is accurate all the way through. We can’t just go put stuff in there with the brand and it not be aligned.
Ken: So, we have to talk to the 3PL’s, the warehouses, we have to know what the carrier rates and what the rate cards are. And by virtue of doing that and being every considerate of the interaction layers and the tagging and all the things that fulfillment needs. And having those conversations, they then in turn say, “Hey I love what this brand is saying they want to do and I like working with you. Let me introduce you to our other 30 brands.” That’s been a key piece of our customer acquisition strategy.
And frankly, it just evolved naturally. And it evolved by being a team player with them and partnering with them and not being threatening and making sure they understand that we are here to help them provide more value to their customers. Be more sticky, which all the 3PL and warehouse are looking for ways to be more than just – pick it up off the shelf, shove it in a box and hope we provide a good rate. It’s more than that.
John: Yeah, that experience is definitely paramount. When you think about the footprint of the business I don’t know how many countries you operate in or facilitate, maybe it’s honestly endless because you’re just that thin layer between the carrier and the customer in terms of that cart. How much of your business, if you can even say, is kind of on the domestic side versus international, is international a big growth area in terms of innovation and planning for the future? Tell us about what that landscape looks like today.
Ken: Yeah. Domestic is definitely still dominate, and our business and how many countries we are in is only limited by our customers, our brands, and how many countries they are shipping to. We open up a door that before a lot of brands found too confusing to go through. There are a lot of pain points in expanding internationally.
Right now in the U.S. everyone is talking doom and gloom, recession. That is a way for them to diversify, and sell, maybe shift some of their marketing into the EU, the UK, Australia. Asia, whichever. They say, “hey, if I can diversify, I can spread some of this risk should a recession hits the U.S.” but they just don’t know how. It’s complicated, there is a lot of regulation.
To start, you have to be able to calculate in the cart, what we refer to as fully landed costs. Which means you’re shipping with a label that’s had all taxes and duties paid all the way to the endpoint. If you don’t have that ability to, again, get that source of truth in the cart, the brand may send the package, then your customer will get a notification from their local post that says, “we have a package for you here, come in and pay 10 more Euro and the package is yours.” Then the customer is like, “No way man.” They then contact the brand for a refund.
Then what happens? The brand has to give a refund, if they care about their customers. That package is stuck somewhere. They are not going to have it shipped back and the brand just loses the order. That’s a big pain point that we help them solve.
Then there is also, in the EU and other areas, a lot of compliance things. Such as you have to file your own taxes, and people don’t want to get into that. “If I start selling there, I got to expense on the account side” or whatever. We actually have a subsidiary in the Netherlands that files what we refer to as an IOSS number. Which enables us to handle all of that for them, and we just open up that door for them to expand internationally and that’s been a big key to our growth.
John: Yeah, I can only imagine.
Well, tell us a little bit about the innovation you’re seeing or facilitating on the customer side because being so close to truly the customer success, you’ve probably, even in the short time you’ve been there, been able to see some of the growth and innovation that you’ve enabled on the customer side.
To your earliest point, your mission is kind of to allow the brands focus on what they do well and then pick up the stuff that isn’t as germane to what they’re really good at. So, tell us a bit about the acceleration you’re pushing on that customer side and some of the successes you’ve seen within that customer base?
Ken: Yeah, we have a lot of analytics, and you know we have all the information across many customers and millions of packages. So, we are able to look inside that data lake that we have and do a lot of things dynamically at the checkout time which I’ve already referred to with our shipping customer experience platform.
But we have the ability to say, “You want A/B testing. Set up different lanes within your cart and we can go back and tell you which one got picked the most and were you able to monetize that particular lane and how you word things in the cart, whatnot.”
We also know the volume that’s being sold. So, we can go back to the customer and tell them that we saw an uptick in volume, downtick in your volume and our customers, we have one in particular, I won’t name them, but they sell hats. They sell very expensive and awesome hats. Well because their hats have what is referred to as a dim factor…I can say some of these terms wrong, I’m still a little bit of a rookie -
Ken: - and learning all the acronyms here. But their package exceeds certain dimensions, and if you’re not careful you can lose tens of thousands of dollars in shipping if you’re not cognizant of what is going on and charging the right price. That is one customer where we drastically reduced their expenses but in the context of it, we were actually able to lower the shipping cost through the rates that we were also able to provide underneath that software. So that’s a case of when they experienced a big reduction in expense and an uptick in their online sales.
But the more tangible, to your question, the more tangible element of that is really with our partners, with our warehouses. Our warehouses are seeing 10, 20, 30 percent increases in their volume and in their profits when partnering with us. We have a lot of case studies that we put together and we take to the warehouses and references which are critical. Our brands, Pattern’s customers, our customers, us, we want our customers to become our biggest marketing tool and we want them to fans of BUKU. And we’ve been able to do that by not only helping them, but we come back and tell them exactly what happened and how we helped them, which is absolutely critical.
Those are the two points I’ve seen where we’ve actually helped them drive more business, drive more revenue, and more importantly, reduce expenses helping their bottom line.
John: Yeah, I love that. And it’s probably only going to continue because the crazier the economy gets and the more expensive, inflation going up. Supply chain snarls. It’s just more important and critical for brands to figure out how to solve for the fulfillment and logistics and that is just the most expensive part of that equation. Kudos to you and the team.
I guess as you take a step back a little bit and think through, “how am I creating a culture of innovation at the company and facilitating that?” I hate to use, well I love to use dad jokes, but how do you promote out-of-the-box, or in-the-box [laughs], thinking that takes your organization to the next level?
Ken: You know, when it comes to innovation it’s really hard to specifically answer a one single thing. I answered that in multiple cases. So first, if you understand what your customer pain points are, you can either to do that by having experience yourself or by listening to your customers or your potential customers. In BUKU’s case, it’s really both.
Kudos to the Pattern team, I loved being at Accelerate and frankly, I don’t like conferences. My team knows that! I don’t know why, but there was something about your conference in June that – first off, the people that were there…you guys set the tone in your keynote. Dave set the tone in his keynote. We are here to learn from each other, rising tides lift all boats. And so, you had a bunch of people there who truly wanted to talk to everyone, it was eye-opening and invigorating for me. And I just had incredible discussions with attendees at the conference. That’s already influenced our feature set, influenced our roadmap.
John: Love it.
Ken: I think as a CEO though, you’ve got to provide just enough guidance to your team. Sometimes we as leaders, we provide too much. We go too far. We don’t want to be vague. We are so afraid of being vague that we are almost in our explanation, solving it, and we can pin them into a box. Yeah, they got to have direction, but you got to let them utilize their talents and their skills to implement the resolution to the problem without having already directed them. And that, really for me is really where innovation comes from.
You truly have to understand the pain, you have to allow amazing team members in both product management and engineering teams to be creative and innovative, and you have to trust and empower them to do so. That’s what I’m trying my best to do at BUKU and I think we’re succeeding. We always have a lot of work to do, and we are succeeding and innovating and thinking out-of-the-box if you will.
I joked with you earlier that the “out-of-the-box” metaphor, I’m a big believer and there is a book behind me that agrees, that the solutions to the problem are in the box. And I think sometimes we spend so much time looking for the silver bullets where it’s just "Business 101", "People 101". The way to solve a problem is right in front of your face. Quit looking over the top of it trying to find something else.
John: 100 percent. But I think in a way, even if the answer is in-the-box, creating a culture of innovation, ability to fail, and to your point, not a super prescriptive culture, allowing people to figure it out, even if the answer is starting them in the face, provides more autonomy, creates more resilience within that employee base. So, I think it’s really fantastic. A lot of good principles we can learn from there.
The only other thing I wanted to cover before we get into some of your top leadership principles, and I know you haven’t been at the company a super long time, but you’ve probably spent enough time observing, listening, meeting with prospective customers and current customers to see who’s going to win. Right? And what it ultimately takes.
What do brands really need to deliver on to become a leader in their respective segment or category? What are some of the observations you’ve had in terms of looking forward and determining which brands will pull ahead and which brands will suffer?
Ken: It’s a great question. It absolutely does have to start with having a great product and I think everyone knows that you do need to start with a great product that solves real customer pain.
Ken: But the challenge is unless you’ve created something that is so out there that no one has thought of - I always describe that there are no original ideas, but there is original implementation.
So, you know the most important thing is to differentiate your brand. And the way you do that is through superior brand marketing, touch points, the experience that you provide for your customers. The ones who are going to win are the ones who do this. And for eCommerce business, a big part of that brand experience and that brand interaction is how your website functions. That becomes for a lot of people, your face. It’s the entity they see and connect with. And for me, the way that I tried to help get into that, me being BUKU, is the final portion of that interaction is that checkout page.
It’s small little things, but that experience, after they’ve already had a great experience, great search capabilities and there is all the follow-up, there a lot of things beyond this that I can’t touch on in this short of discussion but that experience that they have at the end of that checkout shouldn’t be a question of whether or not they are going to buy it. It should simply be a question of: when do I want it? How quick do I want this thing? And what are my options for getting it quicker? Do I need the package fast, because I forgot my anniversary, which I’m famous for doing, or my wife’s birthday or whatever, or can I wait two weeks and pay the lowest amount? And if you provide that experience, that last little final touch, it increases your loyalty, they have a better experience, and you cart abandonments disappear at that point.
John: Yeah, 100 percent. Well, this has been so fascinating to catch up. Learn more about your background, learn more about the organization, and certainly learn about what’s happening in the industry, what you’re seeing, and how we can all improve.
With that in mind, I always ask my guests to share with me the number one leadership principle they try to espouse or imbue to their organizations. Having been a CEO before and an executive for so long, I’m sure you’ve rubbed shoulders and seen every kind of leadership value in the book. But what one sticks out to you, and do you cherish the most from your perspective?
Ken: Boy, it’s hard to just have one! But I can pick a section or call it a category. But I believe strongly in being real and being myself. Sometimes I do brilliant things, sometimes I do stupid things. It means being transparent, being vulnerable, but yet at the same time you’re still being confident. It’s okay for my team to know that I made a mistake or that I doubt things. I have doubt. Self-doubt, doubt in decisions. I think it’s important to just, be real. Let them know, “Hey team. I have doubts.” Somedays I think I have this all figured out and other days, I look at myself in the mirror and say, “you’re a dope.” “What are you doing? Why do you think you’ll be able to do this?” And by sharing that it shows, A - that you’re real. And B - it creates this bond of trust.
I’ve had people come up and say “You shared that and I look at you and you’re so confident, I didn’t really think you had the same things that I had. I just really appreciated you sharing that.” That builds that trust you need, that ability to say, “Hey if I fail, it’s okay.” We win together, we fail together. I really believe that is what builds great teams.
And building a great team that is a “we.” Nobody works for someone else; we work as a team. In my case, right now for BUKU. We are loyal to BUKU. We report to BUKU. We are an entire team acting as one trying our best to deliver the best eCommerce shipping customer experience to our brands. And frankly we are having a blast doing it. It’s been absolutely refreshing. And I’m very thankful that I have a team that enables me to be myself and to be real to create that environment and build up a great company.
John: That’s fantastic and I agree with you. Authenticity and the ability to show up as you are and not to have to put on false bravado or false pretenses. Being able to make mistakes while at the same time being able to acknowledge strengths. It’s a really good recipe for as I always say, producing the best work of your career.
I wish you guys the very best, you are just down the street. Certainly, any of the listeners here, if you have a challenge which I would venture to guess everyone listening does. Head on over to BUKU, take a look, see if there are some opportunities to create efficiencies or scale or partner with good people. Any parting thoughts that you wanted to share that haven’t gotten to, Ken, on the podcast today?
Ken: No, just appreciation. Appreciation for allowing me to spend a little time with you. I love what Pattern doing and more, I love the people within Pattern. I expressed that at the event. You guys are doing things right. Together we all work together, and we have the same ultimate desire: to truly have our customers succeed. It’s just a great circle of great people to be involved with and I appreciate that.
John: I appreciate it too. We are all standing on the shoulder of giants, aren’t we? It’s fantastic to be surrounded and feel the strength and momentum of the community. And truly, we are all learning on the journey together as well. We really wish you guys the very best and hope to have you on the show again sometime soon.
Ken: Alright, thanks so much John. Wish you the best as well.
John: Thank you so much Ken. Again, parting thoughts. This is eCommerce Innovators, and we are thrilled to have you listening to this show. Feel free to like and subscribe and share this podcast with others you think might find value from it. Catch you on the next one, thanks.
Ken: Thank you.
The importance of offering multiple shipping options for your eCommerce business: Why giving customers a choice of shipping options can increase...
Ecommerce represents one of the fastest-growing retail market segments. In 2022, Statista estimated eCommerce sales to top $5.7 trillion, and the...
Logistics is a critical component of any retail business and even more important for eCommerce companies. As the popularity of eCommerce has risen,...