If you are a retail marketer in Canada chances are pretty good you know Eric Morris - I’ve known Eric for well over a decade, and I learn something new every time we catch up. Google Canada’s Managing Director of Retail has been at this dent the universe company for nearly twenty years - he’s one of the original 500. Over the course of his career, he has witnessed vast growth within Google and across the industry, and their evolving relationship with retailers in Canada.
Welcome to the The Voice of Retail , I’m your host Michael LeBlanc, and this podcast is brought to you in conjunction with Retail Council of Canada.
If you are a retail marketer in Canada chances are pretty good you know Eric Morris - I’ve known Eric for well over a decade, and I learn something new every time we catch up. Google Canada’s Managing Director of Retail has been at this dent the universe company for nearly twenty years - he’s one of the original 500. Over the course of his career, he has witnessed vast growth within Google and across the industry, and their evolving relationship with retailers in Canada.
In this episode of The Voice of Retail podcast, Eric and I unpack the latest topics at the intersection of technology and retail. Together, we break down key forecasts and trends, and address some surprising misconceptions about the tech giant.
In an increasingly competitive retail environment, Eric underlines Google’s commitment to Canadian retailers - both big and small - and tackles the tough issues that come from the platforms growth and sophistication for advertisers of all sizes.
Eric Morris
Eric Morris is the Managing Director of Google's Retail practice in Canada, where since 2002, he has worked alongside the country's top marketers and executives.
Eric has held several leadership roles at Google Canada, leading sales, operations, research, strategy and analytics for Google's advertising business. Most recently, he led Google Canada's search and performance advertising business. Previously, Eric launched and led Google’s mobile advertising business in Canada.
In 2016 Eric was named inventor and issued a patent in the United States for identifying rising search queries and trends at scale for advertisers worldwide.
Eric was elected to the Interactive Advertising Bureau of Canada’s board of directors in 2009, and served as Chair of the board in 2015-2017.
Born in Montreal and raised in Toronto, Eric is a graduate of Queen's University in Kingston, Ontario.
Michael LeBlanc is the Founder & President of M.E. LeBlanc & Company Inc and a Senior Advisor to Retail Council of Canada as part of his advisory and consulting practice. He brings 25+ years of brand/retail/marketing & eCommerce leadership experience, and has been on the front lines of retail industry change for his entire career. Michael is the producer and host of a network of leading podcasts including Canada’s top retail industry podcast, The Voice of Retail, plus Global E-Commerce Tech Talks and The Food Professor with Dr. Sylvain Charlebois and the all new Conversations with CommerceNext podcast. You can learn more about Michael here or on LinkedIn.
Michael LeBlanc 00:04
Welcome to the Voice of Retail, I'm your host Michael Leblanc and this podcast is brought to you in conjunction with Retail Council of Canada.
Michael LeBlanc 00:10
If you are a retail marketer in Canada chances are pretty good you know Eric Morris - I’ve known Eric for well over a decade, and I learn something new every time we catch up. Google Canada’s Managing Director of Retail has been at this dent-the-universe company for nearly twenty years - he’s one of the original 500. Over the course of his career, he has witnessed vast growth within Google and across the industry, and their evolving relationship with retailers in Canada.
Michael LeBlanc 00:32
In this episode of The Voice of Retail podcast, Eric and I unpack the latest topics at the intersection of technology and retail. Together, we break down key forecasts and trends, and address some surprising misconceptions about the tech giant.
Michael LeBlanc 00:44
In an increasingly competitive retail environment, Eric underlines Google’s commitment to Canadian retailers - both big and small - and tackles the tough issues that come from the platform's growth and sophistication for advertisers of all sizes.
Eric Morris 00:58
Well, all of those principles hold true today, but I think you're right in that the more experienced retailers maybe who have the best data or have been at this the longest and have been able to optimize it or have hired the best or the smartest people may have a leg up.
Michael LeBlanc 01:13
Let's listen in now. Eric, welcome back to the Voice of Retail podcast. How are you my friend?
Eric Morris 01:17
I am wonderful. Thanks for having me. It's nice to hear you again.
Michael LeBlanc 01:21
Yeah, yeah, listen, I was thinking back to the last time you and I were physically in person, I think it was at the old spoke club and we had a big chunky mic sitting between us, we had a great conversation, which I'll remind the listeners to, to page back to that because we really got into your background and your origin story, which is a great interview, but for those maybe who didn't hear it, or you know, for those maybe who want to hear it all over again, give us a little bit about your background and what you do at Google.
Eric Morris 01:48
Yeah, well, I'll be, I'll be brief. I'm actually coming up on 20 years, Google, which is a frightening thought. I joined when there was one other employee in Canada and maybe 500 globally, and now we have over 2000 in Canada and well over 100,000 globally. Over the last five years, I've been running our retail practice here at Google Canada. So, we work with the top 30 or 40 largest retailers in, in Canada. They include the, you know, the large, big box, omni channel retailers like a Walmart or Home Depot or Canadian Tire.
Eric Morris 02:21
Ecommerce only brands think Article or Real Concepts have in Vancouver, Essence, the luxury retailer in Montreal, the direct-to-consumer retailer. So, think like Lululemon and Canada Goose are two good examples there and a couple of the large players who are you know, for lack of better terms, providing the infrastructure for retail today, namely Shopify and lightspeed. So, it's a really interesting cross section of retail all of these companies are in Canada, many have Canadian customers. Some, like in the case of a Canada Goose, or Lululemon, or Shopify, have customers all over the world and that's what we do we help them use Google products to drive sales, whether it's online or in store and build a brand, where YouTube obviously is a great platform for that.
Michael LeBlanc 03:04
Yeah, right on. Now, there's a lot of people in my perception who work in retail, because I come across all kinds of different people. In fact, I was interviewing someone from Google who was in the retail space at a recent RCC conference, tell me a little bit of the structure there, like, how many of you focus on retail and how does that work, like, are you, do you dedicate by, kind of, channel or you dedicate by vertical or by size, just give me a, so the listeners have a sense of when you say, retail practice, what does the retail practice look like at Google?
Eric Morris 03:37
So, I think probably similar to, you know, a consulting organization or others, we have a industry focused team. So, we believe that the insights and the expertise and the offering to, you know, retailer may be different than a bank or a CPG. So, we have a large number of people, it's actually the largest industry of focus for us devoted to retail specifically and so within that we do have areas of focus even within retail because I think working with a retailer who has stores is very different than working with a retailer who, say, only sells online, right, working with a retailer who focuses on the Canadian market is different than a Canadian retailer who has a global footprint. So, we focus on retail and then even within that we have focus depending on the type of retailer and their specific needs.
Michael LeBlanc 04:25
Our last, we, Reset Retail, I interviewed Jamie Gargatsougias she was wonderful and, and she, I guess, oversees the direct-to-consumer. Tell me how that fits in, just, sort of, kind of, orient people who kind of listen to the same thing.
Eric Morris 04:38
That's right. So, Jamie works with Lululemon and Canada Goose, so the direct-to-consumer retail, some of which have stores.
Michael LeBlanc 04:47
Yeah.
Eric Morris 04:47
Others don't, like an Essence is, you know, essentially all online. Clearly, Clearly Contacts out West. There's a large appliance parts retailer in Nova Scotia that we've worked with since our beginning here in Canada called PartSelect, a deceptively large.
Michael LeBlanc 05:03
Yeah.
Eric Morris 05:03
Very, very successful Canadian business, and works with them as well. So, it's the, the brands that are selling their own products direct, some have stores like a Canada Goose and Lululemon. Others don't, but that's Jamie's area of focus.
Michael LeBlanc 05:16
Probably, one of the most read about, written about, studied organizations in the world, this Google thing of yours. Tell me something that would surprise us about you?
Eric Morris 05:26
It's a good question. I think the bar is high because, I think, Google is a well-known brand, and to your point, is written about and discussed a lot, I think, and maybe different things will surprise people differently. I believe and of course, I'm biased, I've been here for 20 years, and I've loved every minute of it. I mean, I think for a large company in one that went from an underdog to, you know, not an underdog today, I think we've done a remarkable job as we've grown holding true to our values and those values have changed, and we're not perfect, no company is perfect and I think, you know, quote, unquote, big tech is under fire, but I think, you know, not all tech companies, not all companies are equal.
Eric Morris 06:14
And I think one of the ways that we've differentiated ourselves versus some, some peers in the industry that your audience will also have read about is I think our values have held, you know, Google started as a company, around this really, really important idea of organizing the world's information, and making it useful and accessible and it was a really big ambitious mission that I really do think has changed the world, and was designed to change the world and I even think, in our own little world of marketing and advertising and that's where, where I've spent the last 20 years at Google. I mean, there's that old adage, you know, 50% of my advertising works, I just don't know which 50% I mean, it's a really big, ambitious idea to make advertising and marketing more effective, more measurable and we've remained true to that as well, on the business side, but I think our values have held true, we're focused on the long term and Google will forego short term revenue to do what's best for the users of our products and for our retailers, and for our customers and I think that too, is, is very unusual in the business world.
Michael LeBlanc 07:22
I was gonna say, I mean, I think back to my history of Google, and I'm as OG in some ways, as you are remembered,
Eric Morris 07:30
Yeah,
Michael LeBlanc 07:31
A guy who was working with me, as we were launching HBC saying, ‘Hey, you know’, his name is Darren Keen, and he works for Apple now. He said, ‘You know, there's this, we got to figure this search thing out. And there's this new thing paid search and a couple of guys’, and I'm like, ‘I don't know, I mean, they're, kind of, just a little startup, should we pay attention to them?’ and, you know, I remember going to a conference and in the US, and some people were going, hey, and it was like this evangelist saying, you got to, hey, do you guys know about this Google thing where you can have pay per performance and measurability, does everybody know about that? And you look around the audience and everybody's looking each other going, ‘Who?’, boy, so far, so fast, in 20 years, it's pretty incredible, really.
Eric Morris 08:09
It is.
Michael LeBlanc 08:10
All right, well, that brings us right up to current events. Let's talk about trends for the holidays. We're talking here. In October, we've got the holidays, staring us down so to speak, or we're great anticipation for Holiday 2021. Anything you've, you've seen about consumer behaviors, you would comment on, your, you guys are always out there, checking in on habits and behaviors and stuff like that. Anything, anything you think might be different then, then we might expect, how are you seeing the holiday?
Eric Morris 08:38
Well, it's a great question, of course. You know, really timely, as we're taping this and taping a recording in early October, I mean, I think, I think every year Holiday is different. So, I mean, I've personally been working exclusively with retailers for the last five years and I think back even just five years ago, I think Holiday shopping online, was typified then as, sort of, a cyber weekend event. So, it was Black Friday, Cyber weekend, and then Cyber Monday and then I think what's happened over the last few years is every year it seemed to get started earlier and I think also has gone on later. So, I think the, you know, the sort of, last day before, you know, you could, your gift would certainly arrive before Christmas. That has, I think, as the infrastructure has been built out in Canada, and shopping behavior has changed, I think that has gone on deeper into the holiday than every year.
Eric Morris 09:38
So, we used to have these really, really big peak moments that were call it four or five days. And I think now that curve has been stretched out, we're, hol-, holiday shopping starting a lot earlier than ever before and also continuing later than expected, right through Boxing Day and even into January. So, I think that always happened. I think last year, which was really the first under COVID, I think there were a few things that everyone was watching very carefully. The first was, you know, would Canada Post and the couriers be able to get all of these boxes that now everyone's, you know, trying to get their gifts delivered online with stores closed, would everything arrive on time, or would we have to order really, really early and so last year, we saw shopping start even earlier than ever really, you know, beginning of October.
Eric Morris 10:24
I think that was juiced a little bit by a Amazon Prime Day that occurred last year in October.
Michael LeBlanc 10:30
That’s Right.
Eric Morris 10:31
Whereas previously, it had been a summer event. So, between like the, the COVID issues, and then Prime Day, specifically, last year, in particular, shopping started much, much earlier than ever. The deals came out earlier, the advertising to try and prompt that shopping behavior was earlier than ever and so that's where we were last year and so I think, this year, like, what are we watching for this year and I think there's sort of a few key things, it's a long way of getting to your question.
Eric Morris 11:00
I think the first is that those trends holiday shopping starting earlier than ever have continued and even without a Prime Day in the market. You know, what we're seeing here is that almost a third of Canadians, we've been surveying Canadians, every two weeks since COVID began. So, we have this amazing piece of research. We've been doing it every two weeks in this country. It's unique from that standpoint, roughly a third of Canadians, as of early October have already started their holiday shopping.
Michael LeBlanc 11:28
Do you, do you think, do you think Canadians are hearing this supply chain chaos message because there's certainly retailers, in fact, last week, Robin Lee from Lee Valley Tools put out a note to his customers saying, listen, you better shop early because I'm not sure I can replenish again. So, do you think that's resonating or do you think it's more organic than that?
Eric Morris 11:47
Well, first of all, I think it depends. So, I think the largest retailers with the most clout in the market are more, more likely to be able to weather the supply chain hits, and have been able to make the investment in inventory are the ones who can pay more for shipping containers and other things. So, I think whatever the supply chain issue is, it's not going to affect all retailers equally. There are examples, Altitude sports in Montreal is an example of a retailer that emailed their customers, I think a couple of weeks ago, encouraging them to shop early because it's possible the gift you want may not be available later in the holiday shopping season.
Eric Morris 12:27
I was on the Toronto Sun's website yesterday. I like reading Steve Simmons, weekly Sunday column, the front page of the Toronto Sun was the supply chain issue.
Michael LeBlanc 12:38
Crazy.
Eric Morris 12:38
And what it meant for shoppers this holiday season and to me that really represented this issue has gone mainstream. It's not just like a Wall Street Journal, or a Globe & Mail industry article. This is something now consumers are starting to think about and on Google because, you know, we historically have used searches as a proxy for demand or interest in topics or even products and that's, of course, the interest of retailers, but searches in Canada for supply chain have reached, like, an all-time high as of last week and you can see that on Google Trends. It's a publicly available tool. So, I actually noticed that this morning.
Eric Morris 13:15
So, I think it's very, very much top of mind you have retailers, like, I think it's Best Buy, in the US, that have come out and said hey, shop early, and if the item you buy is discounted later on, in the holiday season, we will issue you a refund.
Michael LeBlanc 13:29
Yeah.
Eric Morris 13:30
You have all sorts of other retailers starting to front load, their promotions and their advertising as a result. So, I think similar to last year, like that drumbeat is getting a little bit louder, all of which is to say holiday shopping is going to start earlier than ever again.
Michael LeBlanc 13:47
It's interesting, you know, as you say about supply chain, I mean, I kind of think supply chain is more a little bit sand in the gears than it is a broomstick and the bicycle spoke. In other words, you know, what the, the interesting part of it and maybe we'll see it in your data is the ability for consumers to substitute. In other words, I can't get in red, I'll get, I'll take it blue, like, it's not, necessarily, a zero-sum game, right, consumer behavior. I think it will be really interesting to watch this holiday, so.
Eric Morris 14:13
And, you certainly hope as a retailer, they substitute with you, and you don't somewhere else, but I think you're right. People are still going to get gifts. They're going to find something to buy, and I heard one large retailer saying, like, you know, if we've got it in stock, like, you know, people are going to buy it.
Michael LeBlanc 14:30
Yeah, yeah.
Eric Morris 14:31
You know, so. So I think like, certainly Canadians shopping earlier than ever is the biggest trend and we saw this, you know, even recently with back-to-school, Mother's Day, Father's Day to, sort of, a lesser extent because it's less, slightly less of a shopping moment, which much agree, but, you know, these holidays continue to see people searching for products and shopping online earlier every year. So, if you look at sort of queries on, on Google in Canada for Mother's Day, and Mother's Day gifts, like, it started a few days and even a week before last year, which was earlier than the year before. So, it's just, sort of, this, this trend, all shopping not just Black Friday and holiday specific that people are starting their shopping earlier.
Eric Morris 15:16
We're going to need a lot of interest in gifts, specifically people coming online, Google or otherwise looking for just ideas. So, gifts for, you know, call it boyfriend, girlfriend, husband, wife, 12-year-old daughter have doubled versus a year ago and so people are coming on then looking for ideas. It's not just sort of sniping where they know exactly what they want, and you can get it to me the fastest or the cheapest people are coming online looking for inspiration. I mean, that's probably not a new thing, but I think being able to quantify it and say it's doubled versus a year ago.
Michael LeBlanc 15:48
Do you think do you think that's because and we certainly saw this was the case in the in the peaks of the COVID era, that consumers are very mission oriented in the stores, they didn't want to hang out, they didn't want to, you know, browse, they didn't really want to talk to anybody, they just wanted to get the heck out and get the heck out and have they substituted, you know, the whether it's, it's on your platform or other platforms, kind of, I'm looking for inspiration, I don't want to spend too much time in the stores, but maybe I can find it here, do you think, do you think that's what, what's happening behind the scenes?
Eric Morris 16:16
I think it's possible. I mean, I, you know, I would probably build on that a little bit and say, it's not that people aren't going to your store, but they are visiting your digital store first and I think that's, that's the nuance and you know, we've seen this across like many industries, it's a little bit different than the traditional retail that you and I would focus on, but if you think of like the automotive experience, how that's evolved, really, the first visit to the dealership, is the one you do from your home, it's that virtual or digital dealership and when you actually arrive in the store, you're far more informed, and you know exactly what it is that you're looking to do. So, our message to retailers would be, hey, when people are looking for inspiration, let them find you, let them find, let them watch your videos, let them be inspired, right. Let them engage with, like, your virtual store, see what inventory is available. So, they're more likely to choose you if they, if they decide to actually go into a store.
Michael LeBlanc 17:14
You know, as we think about the post COVID era, it's nice to be able to say they're, you know, within, within, you know, shotput range, we go to post COVID era, anything that your data tells you that might be permanently different about how consumers behave, you know, when you talk to all those great retailers, and between their conversations and your observations and this wealth of data and the global footprint that you've got. So, you can observe things around the world any, any themes coming out, you know, again, I always ask people, you know, structural changes versus temporary adjustments, kind of, thing. Any, any thoughts on that?
Eric Morris 17:49
Well, I've got a couple, a couple thoughts. I think one is, look, Canada had historically been behind in eCcommerce across like all categories, I mean grocery is the most obvious one where we were basically nonexistent, but even in general merchandise, it was probably at half the rate of the US and I think COVID Was this forcing function in Canada where I mean, e-commerce probably tripled, quadrupled, quintupled for many retailers during peak COVID, when their stores were closed, and is now settled in at a level that is, you know, double the historical level here in Canada.
Eric Morris 18:25
So, as store, and what's been really interesting is as stores have reopened, yes, for some retailer’s eCommerce, as a percentage of sales may have gone down, but it's still trending well above historicals. So I think that's the most, you know, obvious thing that's changed is that there's this new water level, you know, for eCommerce and digitally influenced sales, even people seeking out inspiration and making that first visit to the store, it's, sort of, online from there, so far better wherever they may be, but e-commerce doubling, I think is the most obvious thing and I think for many retailers, it's now of a material a number that it really can't be ignored.
Eric Morris 19:04
So, you have some large brands like a like a, again, like a Canada Goose or a Lululemon where, you know, eCommerce is a very material percentage of their sales, but I think even for, you know, call it a Canadian Tire or Walmart or Home Depot, or Lowe's or Best Buy when it's doubled. Even for those large retailers, it's now at a level where it matters, right, it's now called, you know, call it, you know, 20% of sales. It's now like, Tuesday sales, right, or like Tuesday and half of Wednesday, so.
Michael LeBlanc 19:32
Which, in some cases, is a good thing because, as you know, given all the time you've worked with retailers, sometimes volume solves some sins. In other words, you know, a few orders a day is not, it's hard to be efficient, but when you get, you know, 500 orders a day, you can become very efficient and it actually starts to drive a little bit of ROI back into the process, right. It's kind of, we don't always think of it that way, but it is sometimes the case.
Eric Morris 19:55
Yeah, look, I think it certainly gives them scale where, hopefully they can operate more efficiently I think it gives them executive level attention, where now you're getting more mindshare, from the executives in the company where it's incumbent on them to really figure this out to figure out the cost structure to figure out the behavior of the people who are shopping online and getting them in store, the people who are in store hoping they'll shop online. I mean, every retailer knows, people who shop in both channels are the most valuable.
Michael LeBlanc 20:24
Yeah, right.
Eric Morris 20:25
So, look, you'd ask me that, you know, what's changed eCommerce I think is the most is the most obvious one. I think other things that are, have changed is, you know, I do think that we have seen a shift in Canadian values that are permanent here and I'll give you a couple examples. I mean, if you think of a, you know, a global pandemic, labeled on top of all sorts of social justice issues, race, and otherwise, I think we're seeing Canadians increasingly making decisions on what they buy, and where they buy from based on their values. And so, whether it's local businesses, I mean, this was really interesting for us, there was that surge, and people shopping locally, during peak COV-, COVID, there is still, I think searches for local businesses are still up 80% over the last year, and people still want to shop locally, even as we come out. The other end of this, people are looking for secondhand stores, not necessarily because it's cheaper, but because they may believe it's more aligned with their values in terms of reducing waste and doing good for the environment.
Michael LeBlanc 21:32
Well, it's interesting, that first point, because as you and I were talking about Off mic, you know, it's all impacted some of that where you shop, of course, is impacted by where you go to work and if you're not working in the downtown cores anymore, I mean, it does feel like you might see a renaissance for local stores, just because that's where the people, or more of the people are, right, and, and your searches would, kind of, reveal that, maybe, I didn't shop locally, maybe I just, you know, shop near work, but now I need to find or want to find and want to help those stores in my community, it feels like it's a, you know, the, the intersection of two very, one neutral and one very good trend, I would say.
Eric Morris 22:11
Well, this is where I have a lot of sympathy and empathy for any retailer business that needs to make a decision on real estate because this is very, very tricky. So, I'll give you the Google example, our office, which probably had, you know, 5 or 600 people in downtown Toronto, we were all in the office. You know, call it every day before COVID. None of us are in the office, right now other than a few on a voluntary basis and will eventually move to three days in the office a week, I used to buy lots of stuff in the path because it was convenient.
Eric Morris 22:44
So, when I go back to the office three days a week, right, will my behavior around
Michael LeBlanc 22:48
Yeah.
Eric Morris 22:48
Shopping closer to where I live, or shopping online. Is that more likely to win out or will I use these like days in the office, these are like my excursion days, these are the days where it's most convenient for me to shop outside of my neighborhood to stores I wouldn't normally have exposure to, so maybe I will continue to shop in the path even as I spend now only 60% of my working time downtown.
Michael LeBlanc 23:15
Or maybe, or, maybe that's your time in the office to be most productive and you never leave because you've got other days. I mean, Google is so interesting, as you know, because you just, you know, as an organization, just to be one of the biggest real estate transactions in New York history, right, 2.1 billion for offices, like you're going on the opp-, you going in both directions at the same time, like we all try to figure out where the smart money is going. It's hard to imagine smarter money some days than Google. So, it's interesting to watch 2.1 billion, you know, that's, that's not checking out of the couch. That's a big decision at the same time, you know, trying to offer all of us to understand what the future looks like. So interesting, right?
Eric Morris 23:53
I think so. And look, we're opening a new office in Toronto in about a year's time as well. So, we've made you know, that bet continued to make that bet even here, you know, in Canada, but I think how much of that COVID behavior sticks, I think is, is really is the big question like I'll, I'll give you an example. You and I spoke about this, like a week or two ago. It's an example from my daughter, who's a swimmer and she was interested in, in a new pair of goggles and we were showing her some pictures of goggles online and she said to us, did you order them, and she didn't say like, can we go to a store and buy them? Can we go to a store and buy them or even did you buy them, it's did you order them, or could you order them because for her, as a six-year-old, those are the types of things that might just magically arrive at your door in a box.
Eric Morris 24:49
And so, I think one of, one of the far-out trends, you know, I'm, sort of, watching and this is informed by another industry expert that I've spoken with is are, we going to see a rise in, you know, for lack of a better term, something called contactless shopping, where you'll have a swath of the population habits formed, you know, during COVID, or otherwise, who never go into a store for the majority of their purchases. They either get everything delivered to their home, or they take advantage of curbside pickup, which is really that third way to shop.
Michael LeBlanc 25:24
Yeah.
Eric Morris 25:25
But, short of, like, really exceptional in person, customer service experiences, or where you need customer service, for most of those things that are just, sort of, a ritual to buy, or you know exactly what you want. Maybe you just buy everything or most of those things contactlessly, which I think is a really big idea, like at YouTube, we've seen over time here, right, the percentage of Canadians who are cord cutters, or cord nevers go up, right, there's a whole generation now that would never think the first thing they do when they move into a new apartment is to make sure they have cable service.
Michael LeBlanc 26:02
That's right.
Eric Morris 26:03
That's what I used to do, but that's not what a lot of people do today and similarly, are there going to be people who, again, cut out stores and shop mostly online, wherever possible, as a new habit that's formed during COVID. I think it's a really interesting idea, and one that will obviously take many, many years to play out, but I think it's worth watching.
Michael LeBlanc 26:22
Yeah, it just highlights this chasm between experience and efficiency, right, like, it's a very, very efficient way to shop, but from an experience perspective, you know, it's there's some experiential components to it's a nice product, delivered at your door, but it's a very different experience. Which is a nice segue into a conversation you, you and I had a couple of months ago. So, I'm, kind of, curious what happened. We were talking, you asked me, what do you think the big trends are three years oout, what are those big trends and I joked this, I don't know what they're going to be three months out, let alone three years, but okay, I'll take a shot at it. So, I imagine you talked to a few people any, any, any early conclusions, conclusion, but any early thoughts around what these big, mega-trends are from, from your research and from your resources?
Eric Morris 27:06
Well, I think this idea of like, a swath of the population that mostly if not entirely, shops online is really interesting. Another that I've heard that I think is quite interesting is an increased focus by Canadians on their health. So, that, that, that would be another example of maybe behavior that's changed during COVID. Again, a forcing function of a pandemic, which would have all sorts of implications from whether it's the Apple Watch, you buy where they keep, you know, they keep adding in all sorts of new health features and maybe that really is the killer app of smartwatches, you know, to working out in your home to, you know, supplements, like there's all sorts of health-, healthy food, and groceries, and living. There's, when you think about a broader focus on health, it has the potential to, sort of, rewire lots of different things that we eat or that we wear or that we buy. So, I think health is a really, really interesting one to watch and I think it's related to values, but I think it's slightly different.
Michael LeBlanc 28:14
Yeah.
Eric Morris 28:14
What do you think?
Michael LeBlanc 28:16
Well, I think over the long run, you will see this recalibration of, of retail from a bunch of things and I think of, I interviewed this MIT professor last week, and we were talking about AI being over, overhyped in the short term and under, under expected in the long run. And, I think this, this idea of anticipatory retail is really interesting to me. In other words, you know, and I spoke to Robby Kalman Baxter, who's this membership guru work with Netflix, and you put those two things together. And I think we'll get to a day, and maybe it gets at that never go into store, but I don't I don't see it. So black and white, but I'm looking for things in there just show up. Like right now you've got to go ask for something or it gets, you know, that's sufficient. But with all the data that many retailers have, maybe they'll just send it to you. And then you, you know, of course you can return it, but they'll get so good at predicting, and I think that's been a clarion call.
Eric Morris 29:00
It's so interesting, didn't I think Frank & Oak tried this in Montreal a couple of years ago.
Michael LeBlanc 29:18
Yeah.
Eric Morris 29:19
I think they called it the Hunt Club and they were sort of banking on men who didn't like to shop. So, we'll just keep sending us shirts and things that fit you and hope that you like them. You know, it's a really interesting idea and I think, Michael, one of the things that has surprised me that it hasn't happened faster. There is one very, very large retailer in Canada that has created that Netflix-like experience for shopping, where you go to their homepage, and everything on the homepage is curated to you based on what you've looked at around your cart or bought before and I think they've said that up to 40% of their total sales come through product recommendations and you compare that to virtually every other retailer in the space where if I shop at a store all the time, and you've never shopped at them like you and I somehow both get the same homepage.
Michael LeBlanc 30:15
I thought we'd be farther ahead in that, I was, we were talking about this in 2000. Like,
Eric Morris 30:19
Yeah.
Michael LeBlanc 30:19
Everybody gets a different homepage. But it, I don't know, I thought we'd be way further ahead in 2021 with that, I mean, even the best now, kind of, do an okay job of it. It's hard. I mean, A, it's hard and B, I think there's the, the concern that if I just show you what you want, and this was actually this professor from MIT's think.
Eric Morris 30:39
Yeah.
Michael LeBlanc 30:40
All you're going to do is make, you, it's like an echo chamber, right, well, I think you wanted more tuna. So, here's more tuna, when really, you might be open to buying three other things, like it's a really tricky one, right?
Eric Morris 30:50
Oh, well, I think that's true and I think certainly, that sort of product dimension, that it that is a risk there. But I think even at the customer level, like, you know, a large retailer knows who their best customers are.
Michael LeBlanc 31:04
Yeah.
Eric Morris 31:05
And they know who their worst customers are, or they know who, who's never shopped with them before, into they create a differentiated experience with the website with the email with the customer service for their best customers and I think the truth is, most don't and I think that that really is a very, very big opportunity. If you're worried about that echo chamber, and people only buying what they've shopped with you for before, that's okay, but at least know who your best customers are and many of them do and do something different to make sure you retain them and also try and find more of them.
Michael LeBlanc 31:41
Well, it works until you realize as we did, and in some of the companies I work with, that even your best customers are only spending X percent of their wallet with you. Like in other words, we did the research, 30% of their share of wallet, they were the best customers we had. So, you're like, wow, we're not getting 70% of that share of wallet. So, you know, it started to frame our thinking.
Michael LeBlanc 32:03
Last kind of couple of questions for you been very generous with your time I want to talk about Google, I want to talk about what you guys do and you know, in the early days, and I referred to it back then, you know, it was it was anybody who had a sense for performance marketing, could go into Google put down a credit card and achieve amazing things, right, it was like it was like wizardry, it was like science fiction, wait a minute, you search, that's nothing, you're like, I remember I showed it to somebody, they said oh, my God, you're like a wizard.
Eric Morris 32:31
Yeah.
Michael LeBlanc 32:31
You know, like anybody could do it. I wasn't particularly steeped in the math, but I figured out how to do it. It feels like 20 years later, it's hard to get an advantage, but, you know, it's hard for businesses that don't have the resources to hire people that are really, really, really steeped and specialized in, in your product to win, do you think about that, like the platform becomes a bit more, more efficient or works better for those with the resources to use it and it's, it's kind of, lost a bit of, it's zip for the small business, how do you guys think about that?
Eric Morris 33:05
I think that criticism is fair, and I think, I think back to like 2002, those very early days, Introducing Google to the market and I think it was, it was revolutionary at the time to have this auction and there was you didn't get a better price. If you spent more or you spent less, you could start and stop whenever you like, there was no discount, if you were using an ad agency. There were all sorts of things that leveled the playing field and so when you searched for contact lenses, or winter coat, you may get a large retailer, you may get a startup and it was the decision which ads to appear were based on not just how much people were willing to pay in this auction, but also whether people were clicking on the ads, and it was seen as relevant, again, a way to level the playing field.
Michael LeBlanc 33:58
Yeah.
Eric Morris 33:58
And, I think a lot of those principles, well, all of those principles hold true today, but I think you're right in that the more experienced retailers, maybe who have the best data or have been at this the longest and have been able to optimize it, or have hired the best or the smartest people, may have a leg up and so what that means is it's harder for a smaller business to get started or a newer advertiser on Google to get started if you don't have that history, or that expertise, and you may not have the time, or the patience to figure it all out.
Eric Morris 34:33
So, we think about this stuff all the time and I think one of one, so I think we're trying to solve it in two ways. I think that initial experience, what's it like to get started for the first time is something that we can get better at. I think the second thing is we are trying to introduce a lot more automation into it, in some ways to take the decisions out of the people and have data inform the decisions where you should be able to say, hey, this is my business, here's my website, here are my goals, I'm looking for website visitors, I'm looking for people to fill in a lead form, I'm looking for return on ad spend of $5. Meaning when I spend $1, I need to make at least $5 in sales for that to be profitable, and then to take care of the rest automatically generate ads, automatically target keywords, automatically decide like, which customer sees which ad on which device and do it all automatically and I think ultimately, that is the, the ideal state, but it's taken a while to get there.
Michael LeBlanc 35:35
Yeah.
Eric Morris 35:36
Yeah.
Michael LeBlanc 35:36
Well, well,
Eric Morris 35:37
I think the criticisms fair.
Michael LeBlanc 35:38
Yeah. Well, I'm glad you're thinking about it. Let's put it that way. You know, that's, that's a very, very honest and straightforward response. So, I'm glad, a company the size of yours, is, you know, being very thoughtful about that. So, thanks for that.
Michael LeBlanc 35:50
Last question. What's next, there's always something next to Google, what's in the tickle trunk that you can talk about, usually, you're under, you know, some, kind of, you know, you can't talk or else you're thrown out in under the subway, kind of, rules, but is there anything you could share with us from, from Google, and that's in the tickle trunk or what you're working on for what's next?
Eric Morris 36:09
Well, I think there's something to be said, again, for making online marketing, you know, even easier and more measurable. So, you know, I think, again, it you know, Google was this revolutionary idea to make advertising targeted and measurable and effective and I still think there's a lot more we can do. As an example, I think it's much easier for retailer to understand and quantify their Google Investment if they sell only online versus if you have store.
Michael LeBlanc 36:37
Right.
Eric Morris 36:38
And if you have stores, it's a lot more complicated to understand, well, who's going to my store, did they visit my store, did they buy something, if they bought something, how much, do they shop between the two channels. So, I think there's a lot of work that we're investing very specific to retail, to help make our results even more obvious and easier to understand where you don't need like a PhD in math, to understand if this, like, highly automated and effective investments working.
Eric Morris 37:03
I think YouTube is probably another area that I would I would draw attention to where, you know, as you can imagine, we've seen a lot more watch time on YouTube during the pandemic and I think the, the shifts in consumer video from like cable or traditional television, to streaming, whether it's YouTube, or Netflix or other things, has been a tailwind for YouTube and others in the online video space. I think historically, marketers and retailers included have seen YouTube as a place to build brands, as maybe a replacement or complement to a TV buy, but, you know, there's so much commercial intent on YouTube unboxing videos, product reviews, that, I think personally, we haven't done a good enough job making that, you know, the best marketing opportunity that it can be for brands and for retail.
Eric Morris 37:50
So, finding a way for retailers and brands to harness that commercial intent on YouTube, and make it a really, really effective marketing and sales channel, not just a brand channel is something where we've invested a ton of time in, Is there a way to make a video ad on YouTube as effective as that little search text ad, I think there is, and we're on our way, but that's been like a big, big area of focus here as well.
Michael LeBlanc 38:14
Well,
Eric Morris 38:14
Those have got to be the two that I focus on.
Michael LeBlanc 38:16
Yeah, it's great. I mean, yeah, as you know, I'm a, I've got a bunch of YouTube channels myself and it's interesting as I think through the organic versus paid, and even down to the categories, you know, I have many business podcasts, but there's not a business category, right, it's news and politics. I always thought, huh, that's interesting. So, maybe take that back to your development team, maybe that categorization of the organic videos can help amplify. There you go.
Eric Morris 38:42
I will, I will.
Michael LeBlanc 38:44
There's my consulting to, to go to Google. Listen, Eric, always a treat to talk with you. We've known each other a long time and it's been very fruitful, and I always learned something when I talk to you. So, thanks for joining me on the Voice of Retail, it was a real treat and I look forward to catching up with you again soon.
Eric Morris 39:00
Thanks again for having me and I really do hope this time is the next time I see you in person, so.
Michael LeBlanc 39:05
Right on.
Michael LeBlanc 39:06
Thanks for tuning in to today's episode of The Voice of Retail. Be sure to follow the podcast on Apple, Spotify, or wherever you enjoy podcasts, so you don't miss out on the latest episodes, industry news, and insights. If you enjoyed this episode, please consider leaving a rating and review as it really helps us grow so that we continue to get amazing guests onto the show.
Michael LeBlanc 39:25
I'm your host Michael LeBlanc, President of M.E. LeBlanc & Company Inc. and if you're looking for more content or want to chat, follow me on LinkedIn or visit my website at meleblanc.co
Michael LeBlanc 39:34
Until next time, stay safe and have a great week!
SUMMARY KEYWORDS
retailers, people, Google, retail, Canada, large retailer, store, shop, buy, canadians, big, shopping, customers, holiday, Youtube, working, trends, week, year, online