It's Always Day One

Stefan Haney - Part 1

December 01, 2020 It's Always Day One Season 1 Episode 25
It's Always Day One
Stefan Haney - Part 1
Chapters
It's Always Day One
Stefan Haney - Part 1
Dec 01, 2020 Season 1 Episode 25
It's Always Day One

Stefan spent 16 years at Amazon. His roles include: director of seller experience, director of seller strategy, and director of consumer shopping experience. Across this 2-part episode he discloses an array of fascinating insights on the inner workings of Amazon, how business decisions are made, and some great stories. 

 In this episode we discuss: 

  • How he fought the 1P/3P fight at Amazon
  • How Amazon categories their different customers, and how they order them in importance
  • What it means to get a ? email from Jeff Bezos, and why you'll be calling your wife about it
  • Examples of next level customer obsession internally
  • How brands can look round corners to identify breaking points
  • What he views as essential on an Amazon detail page, from his time leading that team
  • What the team leader of A9 (Amazon's algorithm) told him


 You can find Stefan on LinkedIn here. You can also check out Vantage International here

Discussion points: 

Show Notes Transcript

Stefan spent 16 years at Amazon. His roles include: director of seller experience, director of seller strategy, and director of consumer shopping experience. Across this 2-part episode he discloses an array of fascinating insights on the inner workings of Amazon, how business decisions are made, and some great stories. 

 In this episode we discuss: 

  • How he fought the 1P/3P fight at Amazon
  • How Amazon categories their different customers, and how they order them in importance
  • What it means to get a ? email from Jeff Bezos, and why you'll be calling your wife about it
  • Examples of next level customer obsession internally
  • How brands can look round corners to identify breaking points
  • What he views as essential on an Amazon detail page, from his time leading that team
  • What the team leader of A9 (Amazon's algorithm) told him


 You can find Stefan on LinkedIn here. You can also check out Vantage International here

Discussion points: 


[0:00:00] George Reid: Welcome to It's Always Day One. My name is George Reid, a former Amazonian turned Amazon consultant. Each week on the podcast, you're gonna hit industry experts, brand owners on Amazon employees share their answers to the basic yet fundamental questions. You should be asking yourself about your Amazon business. Now let's jump in. Hello Today I'm very excited to bring another brilliant X Amazonian guest. Stefan has Bean a belter, a resume with 17 years spanning across an array of roles at Amazon, including director of seller experience director off seller strategy director off Consumer Shopping Experience So fun. Welcome to the show. Do you want to give us a quick 32nd in charge of I got Anything wrong there? Is that roughly right? Jonah. Correct. May and then we could get some questions.

[0:00:50] Stefan Haney: Sure. Well, thanks for having me on the show. It's great to be here. Uh, enjoy podcast, etcetera. It's not quite 17 years, and I think, but at Amazon, you know, they, ah, year of Amazon can feel like a a number of marathon. So I think technically, the math works out to be just about 16 years at Amazon, but and while I ended a director. I got the chance to grow with the company a lot. So I started in a number of individual contributor rolls and then grew into being able to manage and direct different parts of the Amazon business privilege.

[0:01:24] George Reid: Yeah, you're absolutely right down. No, like I've obviously being at Amazon, the girlfriend still there, and she's approaching the six year mark. And, you know, sit next to each day. You can see, like, six years. Amazon feels like nine years and many other companies because you're certainly there's no easy day, particularly, you know, today we're recording day after some of the Mondays. It's obviously a a spicy period of the year where you can see Amazonian is running around. I'm quite aggressively. So when we were speaking a beer beforehand building up to this, you made a really interesting comment that I'd love to elaborate on. You said you fought the three p one p fight. Could you explain a little bit more about

[0:02:09] Stefan Haney: that? You're going right to the juicy, juicy, fun stuff. Yeah, I think there's e started Amazon and there was barely three p. I started in 2003, and so everything Amazon sold, they sold as a retailer. That was one of the early things that felt like a big decision, right? You know, Amazon's gonna open up its detail pages. The third party sellers on that that grew as much things that Amazon do is kind of in a different part that grew over in the merchant technology space. Uh, and there's so much that happens at Amazon, it's It's hard to even track internally when you're working there. What group is working on? What on DWhite are they doing? Eso, you know, kind of had grown under the covers. You know, in 2009, 3rd party seller businesses. Roughly 25% of Amazon's overall sales orders shipments. Whichever way you wanted to slice it on. And you know that starts to become a pretty substance. Part of the business on there wasn't complete understanding across the board, right? How does that decision to share the detail page, or even have three p on your site work out into all the different spaces? Right. So when you're making an O. P. One plan Hey, you're just doing business as usual. That tends to think about Amazon. The retailer Ah, full. Yeah, they're probably also a big deal, right? Wanna grow selection? You might want to do that on Ben. Sometimes you get new people. The company. I think every every year I'd see a email out toe. You know, one of the data warehouse list. How do I find all the third party sellers that I should bring on is a vendor Are some version of that. It's like, Hey, quick profit test you A third party businesses is, you know is Are you sure that's the best thing for customers? And the best thing for profit? Let's double check, right? There's always this this understanding, kind of increasing understanding of how a marketplace works. See, uh, yeah, a za much as I could probably go there. Yeah,

[0:04:08] George Reid: no, it zits difficult, I think from my from my experience. But now I was on the south side of the business, and my part is on the one piece out of the business. And a lot of friends are kind of in both camps. And what we used to often five particularly being on three p was incredibly infuriating when you were like this is the best decision for the brand to go with a three p business model. Other vendors would come over and be like No, no, no, no, no, no, no. We've decided that we want them on one peak. It should be really bad from though it doesn't matter. We're putting them in one page on. Did you know, sometimes it was certainly about a decision, but what I felt Andi speaking on as an external now perhaps the customer obsession wasn't always there for the brand itself off. Are we making a decision of what's best for Amazon? Or were you making a decision of what's best for the brand? Did you ever feel that was the case when perhaps those lines are a little bit blurred?

[0:05:10] Stefan Haney: Well, I think the, uh, we had a tenant. You know, I love tenants. It's one of things I've carried post Amazon, because I find them just helpful. Clarify IRS from my clients, the business. How do we share make our assumptions about our business explicit. So especially if you hire all these new people, How do you kind of quickly get them on board? Uh, and and tenants are Quickly get them on board how our business has been thinking about things, and tenants really help do that on in the, you know, through business or in different parts of his business. Who is the Amazon whose Amazon customer? It's like, well, cellars or a customer. Vendors are a customer content creators or a customer developers or a customer s. So if you have to make a choice where you have to trade off customers, I think that's hard on DSO. You know, you could think of a tenant where the shopping if we have to. If we're forced to make a trade off, you know who should come first. Well, we'll make them in order of, well, prefer the shopping customer than the seller. And you see, I work out things like free reps or free replacements. Um, if a cuss shopping customer thinks they didn't get something or think they didn't get something in time or didn't get exactly they ordered, Amazon may choose to apply a policy that, you know the seller will have to live up to the Amazon standard for all customers. Overall, that could be hard for sellers because that's going to hit there. Yeah, this is a big market place names on customers have a high standard. But making those trade offs you know as you decide like, yeah, should we bring the brand of general What's the best for the order of customers? You know, if Seller could be in stock a bunch, they have low prices like that's what Amazon once for all its customers, being stocked with low prices and have a great experience,

[0:06:55] George Reid: I think, yeah, you're absolutely right there, like in my mind that when it comes to customer obsession, you're right. You can see the waiting is heavily towards that of the end user of the product, more so than the than the brand itself, which is fine. But I think if you're a big if you're a brick High street brand, perhaps a lot easier to kind of get around that and go, we'll send another one. No worries. We'll take the hit. If you're a small up and coming brand. It can be a lot more difficult, I think, to kind of take and swallow that which, which is why we see so many challenges, so many challenges today.

[0:07:31] Stefan Haney: Well, I think that's a key thing being said. You know, one of the things I found. I started in the vendor side of the business, right. I had a lot of vendor software, responsibility, eyes where I started in Amazon, a lot of automated ordering and then moved to the seller side of the business, and you had to quickly get shifted. Thio, When you're dealing with the vendor, that's probably, uh, yeah, a couple dozen employees. There could be a bigger brand, right? And they're generally functional specialists. You start working with sellers, and you quickly find out that a lot of sellers are 3456 person companies, and they do everything right. And and margin and, uh, cost hits have a different impact on the seller, uh, than it does when you're doing with the vendor. And so you work that out of the corners, right? Say, hey, on one hand, you is a very small business. Get the opportunity to deliver toe hundreds of millions of customers, but you now have to step up your performance level right on will help you. But you still have to get there. And that's hard for some small sellers.

[0:08:35] George Reid: Yeah, I think in some capacity is getting easier with the tools and the data Amazon are making available to to sellers and vendors. Middle, the sellers have an easier gig with the seller Central platform in the bender. One eso it is getting easier. Yeah, well, that has incredibly dated on that vendor central platform, even today, Uh, but we think that that customer obsession question then can you give an example of customer obsession in practice? Internally, we've given one there, but are being treated kind of explore any others that you saw that kind of stand out where you're like, we nailed customer obsession here, or this is a great example of it.

[0:09:17] Stefan Haney: Yeah. Yeah. Working at Amazon was is just fantastic, I think. You know, recently, somebody else posted some content and they were asking about lessons from from Jeff Wilkie. I was working on the cold, prickly program, right? That's that feeling you get when you open up in email and say that order you you thought was going to arrive in time for Christmas. Yeah, not gonna happen right on. I was working with someone else, and they were presented Jeff, like we've really We're really set up to have an improvement of of ex bits and percentage points this year in Cold Brinkley's. Then Jeff just stopped and like look, every customer order that we make to customers every customer promise we make to customers. If we don't deliver, that's a promise broken, and I don't care about the percent. It's every individual customer promise matters, right? So really, you flush that out when your senior leaders is Hey, you're about toe. Have a bad Christmas for a town this big, right? Amazon ships a lot of stuff, you know, if you were going to disappoint the entire town of Melbourne, Australia, for Christmas, that's not great, right? Individual customers matter, you know. And so, seeing that I was always inspired by stories, you know, I worked early on again in cold. Prickly is in the very first part. Um, you know, just the links that Amazon went to Thio, you know? Well, here's another example. You have one item and you have to You accidentally took to customer orders for for a race condition. You could cancel the one item, right? And then you see the get that that you see the notes, you know, from from Grandma Sally too. Her twin granddaughters. You hope you enjoy these dolls. You cut the doll in half. Do you ship one? You cancel all the orders. Like everybody with kids going. I don't want to deal with that. Or do you take, you know, a dozen people and say, Please, everybody stopping a store on the way home and let's buy one if you find one and we'll inject it in. Right. So you have this large company, you know, helping to make sure grandma cellie. And I'm changing the names delivers for her granddaughter right on. That's an opportunity to learn. Like, how did we end up in that situation? And I have a dozen of those kind of customer obsession stories. Yeah, but then on the seller side, you know, when we built tools for sellers, you know, you talked about Seller Central. There was a time when I joined in the marketplace. Team seller central software was not great. I got a question, Mark email. Ah, lot of days in a row. My 1st 90 days question mark email from Jeff Bezos about selling pencil software. Uh, you know, in my 1st 90 days on the job being responsible for seller central, Uh, in order to do it was only 9 4010. In order to do a return to a cellar, you had to email the seller, right? Amazon one p had these lovely little just fill out the form. You get a refund in a return. But for all three piece stuff is well emailed the seller. Good luck, you know. So there's a whole that Sellers had to get to to get toe one p parody where sellers have the opportunity to thio be examples of the best experience on the platform. They could compete with one P because that was another thing you had to get to. Sellers is a you know, Seller's is not one group. There's a pretty big continuum of capabilities and and learning. So when we started building software writing and reading documents, the Amazon press release usually has quotes. Um, you know, in their their internal press release documents of how we're going to build our senior leaders expected those quotes to be from riel sellers, right? If you're gonna build something for sellers, have you talked and called any sellers and ask them what they would think if we build something like this, right? Don't make those up. Call somebody. Call five of them. Right on. That's Ah, that's a really It helps pivot everyone to build software, thinking about who they're building it for, Right? Because you get some. Really? You get some blunt answer sometime. That's not a great idea. Okay, thanks. Thanks for that. I

[0:13:20] George Reid: think. Yeah, that's that's very true. And have you beat someone who has done that? Smile and dial to Amazon sellers over and over again. Middle East Sometimes I was pitching Sometimes I was are always aiming to kind of make their experience better. I think those those quotes are still heavily use heavily used today. I would like to kind of dig in tow for those who are unaware. Exactly What does it mean to get that question mark from in your in box? Are you breaking it or you thinking it's good. I'm in this position to get a question Mark. Big Jeff or what?

[0:13:55] Stefan Haney: Um well, uh, the first time I got I didn't realize I didn't know what it involved. I've never gotten before. I've been in Amazon for five years. I don't know what a question, Mark, email waas one of my colleagues like no, you need You need to stop what you're doing. Like, let me take you through how you answer this. This is going to change your day. Um, you might want to call your wife and tell her you're gonna be home late and, uh, on and, you know, I've come to actually like the question mark process It is. I like it like a fire drill, though. So it's a lot of working. End up a little smoky and maybe blurry eyed later, but it focuses you. So you get this question mark in your email box. You know, we're usually it's gone. Jeff got Jeff for Jeff's office. Got a question from a customer, Something that doesn't make sense or seller doesn't make sense, um, or and help forward that typically. And so you gotta make go to somebody who works for Jeff. A senior vice president finally gets to you, right? And you need thio Take a step back and dio, I need to understand what is the customer impact? Is this special or normal variation like this is ah, you know, really odd event or is this an example of a process. Why did the customer find it before we did? So are we missing? Do I really understand the root cause of this? And I'll seem to understand I have been on a timer. Right? You don't get forever to answer one of these, like, Well, I'll get to this next month. You You probably I tried to answer mine. At least the first draft response in about at least the first draft in about 24 hours on the same kind of cascading chain that it went through. Sometimes those people would wanna make sure they saw your responses before it went back. Went back to Jeff. Um, I

[0:15:49] George Reid: really like the point you made there about Why did the customer find it before we did? I've certainly seen other examples of that. Amazon. What do you think? Listeners who have, perhaps brand themselves operating on the platform, which I know many listeners will be. What do you think they can learn from that thought process of? Why did the customer find it before we did?

[0:16:11] Stefan Haney: Yeah, Yeah, one is is we have this notion of looking around corners on dwhite when you have a business like Amazon that grows really fast. Um, you can just, you know, have a bunch of kids. My wife and I have seven kids and amazing how fast some of the kids growing growth spurts. My son's grown three inches in the last six months, and it's like How did the outgrow those genes so fast

[0:16:35] George Reid: you didn't look behind? E

[0:16:39] Stefan Haney: didn't expect three inches of growth. What's going on? He is 15. He's been sleeping a lot on DSO When When you every process you have you it expects a certain level of business or certain level on DSO if you can look at things and go. When's the last time I tested my process to failure? Right? Do I know when it's gonna break? If I was to triple my amount of shipments into F B A. Do I know what's going to break? Um, if I was, if my return rate was to spike, Um, and so just setting up a cadence where you can start to look a hey, I'm depending on a certain a set of assumptions for my business, for my fees and and if I was just a systematically start testing those every week. Just test one of, um, test one of my assumptions, even as a thought exercise in Excel our Google docks, Google sheets, whatever, Um, so that I can start to anticipate a little bit because Amazon is probably growing faster than I was expecting. Right? Um and so that's one of the things is you look at and go Ah, lot of times with those question mark emails. What I would find is we had outgrown a process or move past a particular system standard performance. Those question mark emails air really useful because they keep everybody. If you know, your biggest leader is focused on every customer example back to that very first thing, raw numbers matter, right? Every customer interaction matters, and then it's your job to understand. Is that a canary in the coal mine or was that you know, it really was a collection of unfortunate events. We want to try to minimize those in the future, but a lot of times they're canaries in the coal mine of Hey, the business has grown a lot the seller businesses, now more than half of of Amazon's overall business, right? That's great. Eso what breaks when that happened. Yeah, give yourself the opportunity to get ahead of that.

[0:18:45] George Reid: I think there's loads of sellers who are experienced and literally that, particularly with the last year that we've had or for March onwards, where it's kind of gone. We don't buy the shop anymore. We can't buy the shopping mall. It's all gone online. How Maney Brands and Sellers. I know many examples where they've kind of gone. Sales have spiked and we're out of stock. We're not gonna be back and stop for this period of time or our performance now a big issue because we're getting more returns because you happen to rush getting these things out quickly. All of these things would, you know, looking around the corners is difficult because sometimes when we discussed earlier on the six people in the business, they're all doing a bit of everything. They haven't necessarily got the opportunity to kind of step back for a minute and look at those little pieces which I think makes it a little bit more challenging, right, like you're you're in that fortunate position or unfortunate when you got a question mark. But you're in a fortunate position. I imagine where you could occasionally step back and go. Okay. I can see if I tweak this lever or this dial is going to break this system over here. Is there any way are there any processes or ideas you could recommend for people to go right every six months, every three months, take a moment or get someone else to look at it or ask a college or get a mentor, anything like this where you can kind of go. This is what I would do if I was in your shoes. And I perhaps didn't have loads of resource, is

[0:20:19] Stefan Haney: you? Well, I would do a couple things, actually, even in Amazon, Uh, that that was key. Uh, you know, if I did an operations review, I would try to invite two or three piers and say, You know what? I have blind spots. My team is doing this review and presenting it to me. Um, I'd like another person to be in the room, uh, to help train my team, right. They're going to see things that I don't see. And it's not like they're all of a sudden presenting to my boss right there, just bringing It's almost like a peer review, right? I might do that one out of every two or three times where I bring in a different audience. Um, because you're going to get a different set of questions, right? So, you know, you could bring in a partner you can bring in. Uh, you know, another seller from your network, you know, and go. Hey, my team is doing a review. I'd love your opinion on this. Just give it to me. I love you to see this person. So sometimes I might be setting someone up for development and trying to help them get promoted on DSO. I'd like you to see how this person presents and help me come up with any feedback I can give them right on dso there's that benefit your own idea of expanding the audience you present. The second tip, I would say is, is making sure you're you're drilling on something. So one of the things I found was a za We got our systems mawr functional. We were getting less question mark emails, uh, from Jeff, uh, and less fire drills. But when we did get one, it had been a couple months and I realized that there was only a couple people on my team who'd ever written one before on they were on vacation. So eso, uh, you know, Amazon also has, you know, specific training for for event call leaders. Right? When When a sev one event goes on, you have to have a special qualification. Special training, uh, to be, you know, the person in charge who's coordinating the response, that event. And so, uh, don't wait for something kind of bad in your business toe. Happen to make sure your team is prepared for, uh, you know, I think I wouldn't call it catastrophe, but for disruption, Right, Um, I still to stop my day. Call my wife. It's not always a pleasant thing, you know? Sorry, honey. Yeah, yeah, my wife is very understanding, and it's wonderful, but it's still disruptive on dso. Making sure you have enough people that you can kind of yeah, number stars I've worked with over time and even small businesses. There's no do with sellers, but you're right the size of the business. There's a balance of how much time you spend operating your business, and there's very little time left over for kind of building or or tuning your business. And so helping some people find a way of, like, you know, how do you at least spend 10 to 15% of your time on tuning your business or or building your business, which is a different kind of thought activity? Or maybe some activities, then just kind of operating your business.

[0:23:35] George Reid: Thio. He's got we what I said a lot inside kind of our Amazon Academy, with many kind of solo preneurs inverted commerce facing those issues. And even if it comes down to what I'm trying to build out at the moment, is people struggling with virtual assistants and even just getting something like that, which can support your business massively, is quite a hefty task in itself. Eso I'm not go through the process interviewing for them in order to provide a better service, even when interviewing it. So the partners she's done hundreds of interviews for Amazon over the last few months. I've listened to a lot of the questions are replicating it, but now, when I decided doing because I'm not an expert interviewing people, I've never really done much of it so Now what I've been doing is interviewing these people without the headphones on, so she can kind of listen to the responses and then just kind of go Well, actually, I sense this or text me a question about follow up on this just because perhaps as a business owner, you're gonna miss something. So the same point applies getting 2 to 3 piers, and that could be a partner that could be someone else in the office. That could be whatever. You can apply that to anything, right? It can be applied to hiring. Or you can apply it to looking at an operational set up, right?

[0:24:54] Stefan Haney: Absolutely one of the most valuable things that that I appreciated it Amazon. One of the more valuable things is, you know, some of the guests you've had on your show or others I could just even sometimes even have in the room because Williamson's organized a lot of smaller groups. I can learn a lot just by how other people are running their their business right. So, having that easy visibility and with the sellers like they, it's not as easy to have the visibility to how other people are doing their business on DSO It can feel isolated. Or like you have to invent it s o finding ways to get visibility. How other people are solving the same problem toe, learn some best practices and then, you know, find some good standards. Yeah, it is a Yeah. Finding ways to do those three things is is helpful.

[0:25:44] George Reid: Hmm. That's a good point. Some good points. Now I wanna pivots slightly to the days when you were the director off consumer shopping experience. This wraps up the first part of the episode with Stefan. Ensure you subscribe to the show in order to be notified about part number two. Next week, we're gonna be digging into Amazon's algorithm, improving that customer experience. And also, I introduce our new speed round in the interim. If you want a daily feed off the best content on Amazon Gov is it? Launchpad academy dot com forward slash amazon hyphen creatives. That's launchpad academy dot com forward slash amazon hyphen creatives. Think you're gonna really enjoy it? I'm stuffing all the top Amazon creative content that I'm seeing at the moment across all the different mediums into one place for you. Let's go check it out and look forward to seeing you next week. Cheers. Hey, guys, just a quick one. If you are enjoying the podcast on either have some actionable next steps or new ideas I'd really appreciate if you could one subscribe to the show and leave us a review. Thes are really, really important to us. As you probably know, being in the Amazon world, Aunt to If you're looking for additional support with your brand, head over to the website, it's always day one dot co dot UK. Where we've got links to other resource is as often our guys speak soon.