Former Stitch-Fix COO Julie Bornstein is creating one of the most innovative eCommerce brands on the market today. THE YES, an eCommerce retail concept only available via mobile app that has already raised over $30 million in funding and is set to revolutionize the fashion industry.
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
Former Stitch-Fix COO Julie Bornstein is creating one of the most innovative eCommerce brands on the market today. THE YES, an eCommerce retail concept only available via mobile app that has already raised over $30 million in funding and is set to revolutionize the fashion industry.
“..and so the beauty of sort of what we've built is called THE YES, the whole system is built based on the customers yeses and noes. And as a customer shopping, they can yes and no the product kind of like a thumbs up thumbs down but in our own greatest way. And you don't have to do it as your shopping but as you see stuff you like and don't like the stuff you like you Yes, we learn about your preferences and we save that for you if you want to come back to it. And then the noes are really helpful…”
Julie’s deep breadth of knowledge building successful eCommerce experiences for some of the largest retailers in America like Nordstrom, Sephora, and of course Stitch-Fix, gave her a deep understanding in what was missing in the eCommerce space. The Yes utilizes a revolutionary recommendation engine, built on a neural network, is one of the first of its kind, and is set to disrupt the entire fashion industry. In this podcast we discuss her professional journey, the lessons she learned along the way, and Julie gives us some great advice on how to navigate through another year of the COVID era
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Today’s podcast is part of an ongoing series of CommerceNext episodes that will feature some the fantastic speakers taking the virtual stage January 27th and February 3rd with snapshot insights into how they dealt with online /eCommerce in the first year of the COVID era and lessons learned for the future.
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I’m your host Michael LeBlanc, President of M.E. LeBlanc & Company, and if you’re looking for more content, or want to chat follow me on LinkedIn, or visit my website meleblanc.co!
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Michael LeBlanc
Julie, welcome to The Voice of Retail podcast. How are you doing this afternoon?.
Julie Bornstein
I'm doing great. Thanks for having me.
Michael LeBlanc
Well, thanks for coming on board. I'm very excited to chat with you. You've got such a deep, rich background in retail. And now you've got such an interesting concept. So, let's just, let's just jump right in and tell us a little bit about your personal professional journey that got you to where you are today. And then we'll get into talking about The Yes.
Julie Bornstein
Great. Yeah, well, I grew up in Syracuse, New York in the 70s and 80s, and spent every weekend in the mall. And had a lot of ideas about how things can be done better. I always loved fashion and retail. When I went, I was a government major and undergrad. But when I was graduating, I really wanted to sort of try out the business world and try out the fashion world. So, I pounded the pavement in New York and got a job at Donna Karen, working really on the whole wholesale side. In between, the merchandising function there, which was sort of in between production and sales, got a little taste of it. Thought maybe it wasn't for me actually went back, worked in nonprofit and went to business school.
But in Business School, sort of as I was trying to learn, I ended up working in investment banking, and found myself very drawn to the retailers that we were working with. I worked on a few sales and IPOs. And so, I decided to pursue a career in retail.
And I actually, it was the late 90s, and I, my husband was at Amazon. So, I was headed to Seattle, and had the chance to meet Howard Schultz and ended up going to work for Starbucks for a few years. And that was really before Amazon had just gotten started. An ecommerce was not yet much of a thing. But I was fascinated by the Amazon experience and as a consumer and kept thinking about the version of that for fashion and clothing.
And then lo and behold, Nordstrom announced they were going to be launching ecommerce. And I spent about six months trying to convince Dan Nordstrom to hire me. And finally, I was successful. And then I spent five years helping to build nordstrom.com, which was really wonderful. So much learning it was the early days technology was fairly limited, but I had lots of ideas that we couldn't do yet.
I then ended up going to Urban Outfitters to help them build out ecommerce. And dragged my husband and kids across the country to Philadelphia. We were there for two years. And then I got recruited by Sephora. And we ended up back in San Francisco. And at Sephora, the mandate was build a loyalty program and take this sort of dated fledgling ecommerce business that was the reason it was dated was because they actually started fairly early at Sephora in the late 90s. But the system was completely outsourced, and we needed to rebuild ecommerce internally. So, I spent eight years at Sephora building Beauty Insider and sephora.com. And it was really a wonderful experience, I sort of merged into a CMO role there. So, I also oversaw the marketing organization.
And then during my time there, I met Katrina Lake, the founder of Stitch Fix, and was very taken by her idea. Had spent a lot of time thinking about data personalization, fashion. And so, it was a very good meeting of the minds. And I ended up joining her board. I was on her board for two and a half years. And then the company was really starting to take off and needed a lot of, you know, hiring and organizational,
Michael LeBlanc
Sure, scaling all those
Julie Bornstein
Scaling opportunities. So, I joined full time as COO. And I was there for the next two and a half years helping build the business to a billion dollars. It was a really fascinating and fun experience.
And then decided to launch out on my own and started The Yes. And so, I spent, let's see, I left Stitch Fix in the fall of 17, and started talking with investors. And in the spring of 18, raised our first round of money. I also spent that time trying to find a technical co-founder. And the idea was really, were really a tech platform. So that was an essential role. And I knew I needed someone with the very specific set of experiences around learning, search and personalization. And was fortunate to meet Ahmet Aggarwal as he was an entrepreneur in residence at one of the venture firms at Bain Capital. And so, we met and spent many months talking as I spent time talking with investors and we decided to go for it and we raised our first round in March of 2018. And then we spent two years building a very, I would say, complicated technology infrastructure to support the business that we are now.
We have a team of 35 people, that 25 are engineers, and other five are product and designers. And then we have a very small brand partnerships team, small and mighty, and a team that does sort of social and marketing. And so, the idea behind The Yes, is really, shopping is overwhelming. Fashion is a really big and also complicated category to sell online. Something I've been doing for a very long time.
Michael LeBlanc
Yeah, yeah
Julie Bornstein
And I really felt like the sort of next frontier relied on technology that wasn't built into the current ecommerce infrastructure. And so, if you look at the tech stack of any established ecommerce company, it's set up in a fairly rigid way, one size fits all navigation very traditional. And that has not changed. I mean, if you look at the Nordstrom site today, and you look at when I was there in the early 2000s, very little has changed to that user experience.
Michael LeBlanc
The fundamentals, the fundamentals your right, haven't changed. I mean, you and I have a couple of intersection points in that I was trying to launch Hudson's Bay's ecommerce in 1999, 2000. Was it always your sense, as you kind of progress through this amazing journey, because it's brought you back to apparel, was it always your sense that it would be such that apparel was the best opportunity? I mean, even going all the way back to Syracuse. Were you seeking to solve a gap? Were you seeking to solve a problem that you experienced around shopping for a particular commodity? Or was it the customer behavior that kind of propelled you forward and, and drove you thinking
Julie Bornstein
it was the category. I've always loved fashion. I've always thought it's so nuanced and unique, and such an expression of our, each of our personalities and our moods that day. So, it's always been the category that's kind of been my first love. And then I also think it's a category that lends itself really well to innovation, because it is such a nuanced category.
You know, you look at what Spotify and other media companies are doing YouTube, and you do it with news, and there's really great ability to understand the user preferences, and create a sort of experience around each user like has been done in Spotify. And, you know, YouTube has done it really well. But no one had done it in fashion. And, you know, at Stitch Fix, we were doing some of those things, it was certainly the first to really take data science seriously and figure out how to marry it with customer preference. But the model itself is quite different, it owns the inventory. So that's it's limited by that. And it works well for a certain customer type. But the more fashion forward brand oriented customer is not particularly well served by the Stitch Fix model, because it's there's not quite enough choice in it. And there's still too much randomness in the style preferences.
And so, my goal was really to take it, yes, you and I were living totally parallel lives in 99, and 2000. But you know, to take all the complexities around the fashion category, and really marry it with a deep set of data that understands every nuance of a product. You know, there's so much around, of course, there's price and brand. And then there's obviously fit, size and fit. And then there's all the things that create a style. You take two black shirts, and they could both be black short sleeve shirts, but there could be, you know, so many differences in the cut, and the styling and the fabrication. And so, there's so much that goes into actually building a good recommendation engine in fashion. And I felt like no one was really doing it. There were a lot of technology ideas out there, but they didn't have consumer facing value. And then there are a lot of obviously fashion companies, but they're doing it in a very light way. And I knew that if we needed to do it, we had to build really deep understanding of the product category, and then a deep understanding of the user and then build an interface that allows us to learn from the user as she shops.
And I'm not a huge fan of implicit data. I really love explicit data. I feel like there's so many inferences that, you know, sort of recommendation engines across the board make that are wrong. And so, the beauty of sort of what we've built is, it's we're called The Yes, the whole system is built based on the customers yeses and noes. And as a customer shopping, they can “yes” and “no” the product kind of like a thumbs up thumbs down but in our own greatest way. And you don't have to do it as your shopping but as you see stuff you like and don't like the stuff you like you “Yes”, we learn about your preferences and we save that for you if you want to come back to it. And then the noes are really helpful because that's a very strong you know, signal and that allows the app and the shopping experience for the consumer to evolve and get better over time. But it required us to build a technology layer that is really built on sort of a one-to-one neural network. So, each user has a, you know, their own experience. And it's the app adapts to the user. And so that technology, you know, is very hard to build into a current economic infrastructure. And where I knew we needed to start over.
Michael LeBlanc
Well, you know, we intersect in even more ways, because at Hudson's Bay, I helped to start and run their CRM division, we had 8 or 9 million people, and we were big fans of the hands up strategy. That's what we called it. In other words, let's not guess let's not build fancy algorithms and try to project algorithm on top of an algorithm let's, let's just ask people what their preferences is and try to, you know, we call it a drip irrigation model. Every time we intersect with somebody, we ask them another little thing and another little thing, and another little thing.
Well, it's an amazing concept. Now, you've had a great journey. Lots of different backgrounds. We've all had a bit of a different journey over the past 10 months, I'm wondering now what is your advice to the listeners around two starts and one stop based on you know, what you've learned over your career, which is clearly reflected in your concept, but also lately around going to market and you know, two things they should start doing, based on your experience. And then one thing they should stop doing. Maybe that's something that you thought would was going to work for you or and didn't or stop working or something you observe others doing, give me give me a sense of those two starts in one stop.
Julie Bornstein
I would say on the starts topic, one thing I am definitely thinking about is planning, so, the first half of the year and the second half of the year differently. And I am an optimist, eternal optimist. And so, I am assuming by the second half of the year, the world will start to return to some level of normalcy. And I do truly, fundamentally believe that we are all going to want to throw out and burn our sweats and get dressed again. And so
Michael LeBlanc
Roaring 20s, we're back to the roaring 20s right?
Julie Bornstein
I mean, that is, you know, in a modern version of it.
Michael LeBlanc
Yeah, yeah, no zoot suits, no zoot suits.
Julie Bornstein
Exactly. So, I do think, you know, starting to really plan for sort of a shift in consumer behavior in the back half of the year, is something that I optimistically believe is a smart thing to do.
I would say the other thing on the start is, you know, it's interesting, we, sort of last year, we were focusing on just get through the year, just get through the year. And you know, it's such a complete shock to the system to go from the beginning, you know, of March, we're like, oh, this might be a few weeks to it being such a long thing. And so, I do feel like, you know, the flip side of the first start, the idea of fully embracing the way we're working. And really starting to make some changes that, you know, I would say alleviate or leverage remote working. So, for us, at The Yes, you know, I think we are all very aware of the fact that the work is from home on zoom all day long, has a real tedious nature to it that real life work didn't have. And so, to that end, we decided we do monthly sprints, and we decided to give one day off after each sprint, just an extra bonus day just for people to clear their heads, you know, hopefully get up and out. And I just think that kind of thing, as we're bracing for at least another six months of this will be really helpful.
Michael LeBlanc
Now, as an executive leader, I've talked to lots of CEOs, some of whom had a lifelong, distressed, I'd put it for home work, you know, people working at home. They like, they like to have people in the office more than then not. Where did you sit on that fence from the beginning? Did you, you know, is this been a big transition in your thinking? Or is it just evolved your thinking a little more?
Julie Bornstein
It's been a fairly big transition. Although I have to say, you know, I feel like we go to work for more than just to get the work done. And that sort of socialization and interaction is such a core sort of need for humans. Not everyone, there are some people on our team who certainly like this. I think where we will land, I was never, I would never have thought of you know, spending more time remotely. So, this certainly has shifted dramatically. I do feel we will go back to the office, at least our team. And we may do one or two days remote for people who want to because clearly that's I think especially for people with their commutes or other extenuating circumstances, this has, there has been a relief to this for in that case. And so, you know, I think it will be more of a hybrid model and my gut is that's kind of where most companies will land.
Michael LeBlanc
Yeah, I hear that word hybrid most often. Exactly. So, what are your thoughts on one thing people should stop doing?
Julie Bornstein
I think one of the things that we can all stop doing, because we now have enough time under our belt is, guessing what would have happened and not planning for the current situation. So, I think, you know, there's, depending on your business, there's been a boom, there's been a bust, there's been a shift in categories that are selling. And I think we can stop focusing on what would have been, and we have enough data to really focus on what this next six months is going to look like, given what we've learned already. And, you know, to some degree, it's exhausting to figure out the two, what it would have been and what it is. And, you know, I think this year, everybody's now in a mindset and a place where we understand what's happened and what's changed. And we can just focus on what we anticipate to be this year based on the experiences we had last year.
Michael LeBlanc
Right on leave, leave it, leave the hypothesis behind, let's move forward.
Julie Bornstein
Exactly.
Michael LeBlanc
So you're on the virtual stage at Commerce Next, what are you doing there?
Julie Bornstein
We have a great panel, we're talking about the intersection of customer experience and digital businesses. And we are talking about mobile and loyalty, and it's going to be really fun.
Michael LeBlanc
Oh, fantastic. I'm looking forward to it. Listen, it was so great to have the opportunity to chat with you such a rich background in retail. It's such an interesting concept. So, I encourage everybody to visit. Is it theyes.com? Is that, do I have the URL right?
Julie Bornstein
It is yes. And now we're Apple only. So, we’re The Yes on the app on the Apple App Store.
Michael LeBlanc
All right. Well, very good. Well, thanks again, Julie, for taking the time to join me on The Voice of Retail podcast. I wish you much continued success and look forward to see you on the virtual stage of Congress Next.
Julie Bornstein
Thank you.