Recap of Shopify's Future of Consumer eCommerce Breakfast at Shoptalk 2023

At Shoptalk, I sat in on a panel discussion led by Ali Orr at Shopify, which included Kasey Lobaugh (Chief Futurist, Consumer, Deloitte), Bobby Morrison (CRO, Shopify), and Ranil Wiratunga (CDO, Dollar Shave Club).

Here are the big things called out during the presentation:

Preparing for the Heterogeneous Consumer

  • Casey conducted research that indicates that corporations are moving from mass marketing a product and more into customization for diverse audiences, due to consumer demographic shifts.

  • The winners will be ones that can create and forge the future, rather than trying to predict the future.

  • Not clear that the supercenter approach will win in the future. More optionality is needed. Kasey noticed that there are now 100+ brands of Mountain Dew. The winners will be ones that are hyper-relevant.

  • Digital goods and services are one of the fastest growing sections of the market and 12% of the consumer wallet growing at 24% CAGR. The size of this market is the same as consumer electronics and apparel. This is stealing from the consumer wallet that might normally go towards other purchases.

Shopify’s Role in the Future

  • Bobby Morrison said that Shopify was “de-frankensteining” tech stacks. How can we help retailers support profitable customization?

  • Brands like Suntory in Japan are winning because they have many micro-brands in the market. Relevancy to the consumer is based on identity, demographics and other factors.

  • Change management is a big challenge for companies. There are culture and operational implications to making changes. Many companies have redeployed or shrunk IT teams as they subscribed to services rather than building them in-house.

  • The ability to adapt and respond to change is critical: “an opportunity not being worked is an opportunity lost.” Shopify’s approach is to offer components and more flexibility to merchants to allow them to select best in breed offerings.

  • Companies with multiple brands are using loyalty and rewards that are enabled by having a common Customer Data Platform on the backend. Authentic Brands Group does this well.

  • Merchants need to embrace a culture of testing. Weaponizing small teams using an “AWS-like” model, and allow these teams to innovate without distraction.

Innovating in This Economic Environment

  • Ranil @ Dollar Shave Club indicated that right now the economy was very “category by category” and it’s hard to make broad generalizations. Overall, however, the consumer is downshifting their commodity purchases and trading down.

  • Audi and Ford are coming up with new subscription-based business models that were not possible for the company before.

  • Ranil mentioned that you can do low-cost tests as well as painted door tests to determine if there is sufficient consumer interest in further experimentation. This can limit your up-front investment in tests that might be more expensive to implement.

Wrapping Up

Overall, I thought this was a pretty major shift in Shopify from their previous message. Bobby Morrison spent quite a bit of time talking about corporate change management. Is this the new Shopify? How do we reconcile the Harley version of the Shopify and the Bobby Morrison version?