The FODcast

Why E-Commerce Won’t Win on Best Practices Alone with Rob Hoekman

• Tim Roedel and James Hodges • Season 7

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0:00 | 54:45

“We’re kind of drowning in a sea of sameness.”

That’s how Rob Hoekman, Senior Director of Experience Consulting at Empathy Lab by EPAM describes the state of ecommerce today.

On this week’s episode of The FODcast, our CEO Tim and Rob unpack how decades of optimisation and best practice have led to convergence - in platforms, patterns and experiences - and why differentiation is getting harder, not easier.

They explore:

  • How ecommerce capability has become commoditised
  • Why replatforming now delivers smaller gains than it once did
  • The risk created by years of customisation and legacy
  • Why brands are being pushed to rethink their entire commerce fabric

Rob’s view is measured but direct: the next phase of growth won’t come from chasing new stacks, but from rethinking how commerce ecosystems are designed and operated.

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Find our more about our approach and our services within digital commerce recruitment here: https://simply-commerce.co.uk/




Speaker 1:

Hello and welcome to season seven of the podcast. The podcast focused on the future of digital commerce hosted by Simply Commerce. Season seven promises to continue to bring you some of the industry's brightest minds across the globe as we unpick the sector and where it's heading. From war stories to strategy and technology deep dives to future trends. We cover it all as we continue our journey to have one of the most popular podcasts in commerce. Before we start, if you enjoy our content, please do hit the subscribe button on whatever platform you're listening on. Like and share on socials.

Speaker 2:

Welcome to another edition of the FODCAST. And I am very grateful and excited to have with me today Rob Hopeman. Rob is currently Senior Director, Experienced Consulting at Empathy Lab, which is a part of the EPAM brand. Rob, welcome to the show.

Speaker:

Thanks, Tim. Thanks for having me today. Looking forward to um to our talk.

Speaker 2:

Yeah, me too. Plenty to talk about. It would be really good if you could give the audience just a bit of an overview of who you are and your background. A bit of bit of context would be great.

Speaker:

Sure, yeah, my pleasure. So my name's Rob. I'm Dutch, as you might hear from my exit, that I try to hide as much as possible. I uh I work at uh at EPAM Systems, which is one of the larger consulting and engineering firms. Um, and I am based in Amsterdam, the Netherlands, uh, as mentioned, where I am responsible for our uh global go-to-market on our commerce proposition, uh, which is part of our agency label called Empathy Lab.

Speaker 2:

Thank you for that. Welcome. Um, it's really good to have you on the show. There's plenty for us to talk about. There's stuff that obviously you and I have have spoken about previously, and I'm quite interested to get into some of the detail on this. It'd be good to kick off with in your view, kind of one sentence. What's exciting you right now about the future of digital commerce? That's what the the show is all about. So it'd be good to get your take on that.

Speaker:

Okay, I I hope you allow me to have it uh be a uh a long sentence because I think there's a lot to be excited about. But if I were to drill it down, I think what excites me most is that um shopping is starting to become a let's say seamlessly woven into everyday life. Now, since since the dawn of e-comm, which is about 30 years ago, roughly, I think, uh, it has mostly been about data-driven optimization, uh removing friction for customers, yet still very much focused uh around the destination or a task uh or linear process. And today I think we see the early signs of e-comm uh turning into an ambient context-aware experience rather than a separate task. Uh, and for me, that is uh more of an emotional and structural evolution of commerce rather than uh optimizing it to death.

Speaker 2:

Okay, so there's a lot there to unpick. Um there's there's a lot of buzzwords kicking about within the industry at the moment, and I would suggest we avoid AI is the obvious one. Yep. But from your perspective, what's the most overused buzzword at the moment that you'd happily get rid of?

Speaker:

Yeah, I think I think there's a lot actually. Um, because many of those uh I believe were born in the in the paradigm of of building a destination uh and then spinning up tactics to bring people there, keep them there, and and get access to the wallets. So but if I have to pick one, uh I'd start with omnichannel. Uh I think that's an that's an overused word rooted uh in a world where channels uh were still the primary organizing principle. Um and I think without using the word AI, uh in an agentic distributed future, um, omni-channel as a as a concept quietly holds industry back by implying that channels and not context or intent uh or interaction uh are still the center of gravity.

Speaker 2:

And how long have you thought about it from that perspective? Because omnichannel was uh I don't know, maybe five, six, seven years ago, the uh a massive buzzword, and it everyone was focusing on their omni-channel offering. How are they gonna have these multiple channels to drive customer engagement? So, how long do you have that view?

Speaker:

Well, before I answer that, I think a second candidate for me would be uh customer journeys, and that's very much attached to the to the concept of of omni-channel. Uh, because much like thinking in channels, which I think is very much an inside-out view, customer journeys also uh assume a linear orchestrated path that is designed uh by the brand. Uh and what we see happening is that reality uh is is nonlinear, is fluid, is intent-driven, uh, and shaped by context uh and not funnels. So, to come back to your question, um, we have launched uh MPT Lab as a label early uh 2025 uh and has been in the making for for about a year. So I think let's say for the last one and a half, two years, uh, we've been busy crafting what we think is the frontline or the frontier of the future of commerce.

Speaker 2:

Okay. And Empty Lab is very, very interesting. And I said this to you when we met. It feels like a really, really intelligent play by EPAM to have that separate brand out there focused purely on that AI piece. But from your perspective, can you tell us a bit more about your path into Empathy Lab and what was the opportunity that you saw personally?

Speaker:

Yeah, um, so as I mentioned, Empathy Lab is uh is a new label from EPOM Systems. Um, and EPOM Systems, I think you could qualify as one of the largest consulting and engineering firms nobody has ever heard of, heard of. Uh, and that is uh that's down to the fact that um it is its heritage is is strongly rooted in high-quality software engineering, and that historically means that we've also heavily focused on uh the CTOs, CIOs, and maybe even the CEOs uh of this world, but that leaves out quite a cordon of um uh of potential customer engagements that are owned by uh CDOs uh or CMOs. So for myself, I've been working in digital, I think, for the last 20 years or so, um mostly on the agency side, uh, and I was working at an agency group that got acquired by ePOM uh about four years ago. Um I was part of the competency center for e-com, uh which then got merged into the wider uh ePOM ecosystem uh of e-com um capabilities and competencies, um where I got the opportunity to uh from my agency heritage uh contribute in the thinking about the propositions for Empathy Lab. Um and uh I think that is where a agency heritage uh comes into play in a sense that um used to be a closed-knit quite heavily vertical um vertically integrated uh agency that blends um technology with uh CEX uh as well as data. And the opportunity for Empathy Lab is to bring this uh to a global scale.

Speaker 2:

And you come from an architect background, right?

Speaker:

Yes, I have um indeed uh a master in um in architecture building and planning.

Speaker 2:

And does that impact or shape how you think about commerce at all?

Speaker:

Yes, it does. It does. Um on a on a number of levels, uh it helps me to think uh in terms of life cycles, uh whether those are technical, functional, or economical, uh, but also the rifts uh between them uh as well as uh the public space. Uh and what we often overlook, I think, is that the internet is actually uh a public space. Um so we design for people uh and communities uh their needs, intents, uh, and their complex contexts. And I think over the past decade, what we've seen is that digital technology uh has been able to unlock unfathomable business value, uh powering billions and billions of transactions every day. Uh, but it has also allowed us to drown in a flood of soulless content uh in which we suffer from algorithms that uh encourage our worst selves. So in that sense, um my architectural and structural engineering background uh allows me to think in terms of systems and and how they interact with uh the people that uh that use them day to day.

Speaker 2:

Okay, it makes sense. So you've applied a lot of that learning into the way you think about the structure and roadmap for the uh the e-com uh integrations and work you do with the clients. Yes, yeah. Makes sense. And one of the things you said to me when we had our first conversation, I think from memory, was that commerce has been commoditized to death. And I I found that quite interesting. Um, but I'd be it'd be good to understand what you really what you really mean by that.

Speaker:

Okay, yep. Yeah, I think as I said in my introduction, we commerce has been around now, e-com for for roughly 30 years. Um, and I think what has surfaced as a primary paradigm in operating e-com is uh is a hunger to optimize for yield. Uh and that means that almost all e-com outlets starting to follow the same best practices, uh, the same interaction patterns and paradigms, uh, which means that we are uh at a stage um where we're kind of drowning in a in a sea of sameness. Uh and perhaps it's it's interesting to attach it to uh to other industries. Uh take take Formula One, for instance. Uh, now that we're near the end of a regulatory era with a big shift happening for 2026, we see now that almost all cars uh follow the same best practices in terms of aerodynamics, uh suspension and brake design, etc. etc. Meaning that the whole field is very close uh to one another. Uh and I think that's also true for e-com from a platform perspective, uh, but also from a uh CX perspective.

Speaker 2:

Okay. Uh that almost leads us into the conversation around digital um and that offline space. But we'll we'll we'll get there in a sec because I've still got another question I want to ask you on just around the kind of replacement cycles or upgrade cycles or whatever you want to call it. Yeah. I said on a post uh on LinkedIn a couple of weeks ago that I think we're entering into the next cycle phase next year. I think you said that these phases are stretching. Um be good to know first of all, do you think I'm right with that? And also, what's driving this? Why have we had that elongated period where no one is doing any or much in the way of upgrading or replatforming?

Speaker:

Yeah. I I I think you're right, uh uh, but probably for different reasons than uh than you think. Uh so let me try and unpack it. Indeed, I do think that the uh, and this is actually uh I think part of that larger thinking about commoditization of e-com. We've seen in the past 20 years uh a few major jumps in capabilities that uh urged uh brands and retailers to step up their game in terms of their digital technology powering their e-com. Uh, I think the first wave of platforms, early 2000s, like AH eCommerce, IBM WebSphere, etc., were very much product-led, so inside out, um, building upon the capabilities of servicing uh products. The next wave, roughly 10 years later, uh actually flipped that idea uh and and focused on uh experience-led e commerce. Uh and it also kind of coincided with um with the emergence of uh mature cloud technology. So here you see providers like Salesforce Commerce Cloud, for instance, or Adobe Commerce uh stepping up the game. Um that actually came with uh with a caveat in a sense that um yes, the operational burden of running these platforms uh lowered, but at the same time it did mean uh that brands and retailers had to basically hand over the keys of their roadmaps to the innovation roadmaps, these providers uh who are pushing on their products. Um, and that rift, I think, um galvanized the emergence of composable where uh the brands and retailers operating their platforms uh were able to let's say take back some of that agency and ownership of uh the experiences that they wanted to push to their customers. Now, at the same time, um under the earlier influences mentioned in terms of uh uh the public availability of these best practices and data-driven optimization has led to um uh a convergence of capabilities of all these platforms, which meant that replatforming or moving to a new stack um yields a smaller gain than it used to in the past. And at the same time, uh, as customers run longer on their platforms, um they they've built up a larger uh body of legacy and customizations, I think, that increases the risk of replatforming, hence the decision to uh to upgrade um is is under scrutiny for for a number of reasons. Now, to come back to your question 2026, uh we'll see a shift. I think you're right in the sense that a lot of customers uh or brands or retailers, I should say, realize that um in order to be ready for an agentic commerce era, they need to rethink uh their digital fabric uh and move more towards the state of running an e-commerce ecosystem rather than a uh technology platform.

Speaker 2:

Okay. So that is a that that is a I would say a much better thought out understanding of why that's going to occur. But we've both landed on the same position, which is going to happen next year. So we've got legacy issues, we've got complicated integrations, we've got marginal gains. Have I missed anything? No, I think that's it. Yeah. Okay. Um, so if we know or we expect retail brands, B2B, B2C, to go through this process next year. How how in your view can brands differentiate themselves in the because you that's what we talked about with such a commoditized, standardized environment. So what what would you advise clients?

Speaker:

Yep, yeah, that's a that's an excellent question. Um, and I think it it it ties into the to the core of of that notion of uh commoditization of the transactional capabilities of these platforms. I think we've we've optimized on-site flow, uh, we've we've removed the hassle of uh online payments, and that that's all taken care of. So, what we at Empathy Lab now try to focus on is uh what happens before uh and what happens after. So pre-purchase uh and post-purchase. Uh and pre-purchase in that sense means uh rethinking how to service uh our products and services uh and how to connect it to a customer's intent in a specific context. Uh and at the same time, post-purchase, how can we make sure that the delivery experience uh is is enjoyable? And uh how can we place hooks that help us uh retain this customer in our brand's ecosystem?

Speaker 2:

Okay. Um I think we can probably from this position start to talk about uh what what I what I coined, I thought I'd coined as digital. I thought I had uh been very smart and I coined a phrase, but it turns out there's lots of people talking about it already.

Speaker:

That's usually the case with good ideas, right?

Speaker 2:

Exactly that. So I know how I how I define it, how how I see it. How are you currently defining that fidgetal beyond the the buzzword element?

Speaker:

Yeah, okay. Um let me start by explaining what I think uh it's not. Um and what I think it's not is is slapping digital technology into physical stores. So for me, it's not about endless aisle, uh, it's not about kiosks, it's not about smart mirrors.

Speaker 2:

Exactly. Sorry to stop you just so I can I I'm trying to learn a bit here. But is that um what you would broadly refer to as retail media?

Speaker:

Uh no, I wouldn't. Oh okay no, I think retail media is is emerging um as a as a very viable revenue stream for retailers to uh to monetize uh safely and securely, of course, the the deep knowledge that they've built up of their customers.

Speaker 2:

Right. Okay. So slightly um different, I had a slightly different understanding of it. But sorry, I'll let you carry on with uh what you think digital is not.

Speaker:

Yeah, so uh what it what it's not is um is is lacing physical stores with with digital touch points to um um service the perception that uh that customers uh are in, let's say, an omni-channel context. For me, uh physical would be about blending physical and digital with with data as as connector into unified experiences that are not about what you sell uh but more about how you can make people feel. So instead of endless aisles of products, you could start to think about how technology can help you to provide endless ways on how to make your customers feel recognized, understood, at home, uh, or even elevated. Um, and then the other way around, uh leverage best practices from in-store experiences into your digital uh engagement layers. So that means how can we mimic uh mimic might not be the best word, but uh elevate uh the product discovery uh part of a customer's journey by using proven tactics that we know work in store. And you can think about uh AR experiences, uh 3D explosions, uh elaborate uh computed product attributes that help make customers' informed decisions whether a specific product or service has a utility uh in the need state that they aim to cover.

Speaker 2:

Okay. Uh okay, I've got two questions. The the the first one is is this what you would refer to as ubiquitous commerce? Okay, and what's the difference then between ubiquitous commerce and old fashioned omni channel?

Speaker:

Yeah, I think I think it's in the in in the words, uh omnichannel. Still, uh, things in terms of these channels that you need to align with one another, perhaps even shape according to what you think a particular customer is in in terms of their journey. Uh, whereas ubiquitous commerce, or as we call it, total commerce, um, is more about how to organize uh your technology, your data, and your experiences in such a way that you're able to bring those to your customer rather than uh tempt your customer to come to you and make them relevant in the moment uh that they engage with your brand.

Speaker 2:

Okay. So here's something that's a little bit um it's not off topic, but it's kind of off script, I guess. Is the way you've described ubiquitous commerce is about the feeling, the elevation, the experience. And the other thing that we're simultaneously trying to do is create a genetic bots that can do everything for you. So, how do you how do you marry off those two things? Because one is removing the experience and automating it, and one is trying to create an elevate it.

Speaker:

Yeah, yeah, I think that's uh that's an excellent question because that that dives into the heart of all that tension that we see as empathy lab uh as well, and that is at the one hand, how can we move beyond um let's say that algorithm-driven sea of sameness that we push towards our customers and think more about terms of empathy and elevated experiences, whilst at the same time try trying to um almost anthropomorphize uh these experiences. So, what you see happening a lot is that agents are given a name, uh, are given a personality as if they are the brand themselves. Um, and I'd rather think of them as intermediates that uh apply um vicious transparency in their reasoning uh and suggesting uh towards customers. So think more in terms of uh probabilities rather than determinism and uh take over the feel that as these agents act as if they're human, they're not uh and they shouldn't be. Uh so the experiences themselves um should not be shaped around that uh I think false premonition.

Speaker 2:

Okay. So this kind of plays into the next question I was going to ask about um products uh must be legible for both humans and AI, and it's something we spoke about previously. So maybe you could uh dig into that a little bit more. Tell me what does that mean for you?

Speaker:

Yeah, yeah, I think what what we see happening right now is um is an exploding demand of of brands and retailers that that display some some FOMO in in terms of wait a minute, if if commerce is moving upstream to to agentic layers that are owned by by the large aggregators like Google, OpenAI, Perplexity, etc. Um, they also start to own the conversation with these customers. So, how do we make sure that these agents talk about our brand uh in a way that we would like them to? Uh, and that means that we need to service uh to the best of our abilities what we have to offer. Uh, so we see a lot of uh clients asking for um services in the field of uh geo generative experience optimization or a CEO agente commerce optimization that deals with making sure that our products uh and our services are uh enriched in such a way uh that agents can have a holistic view of their utility regardless of the context uh a particular customer uh is acquiring uh them for. Okay. Does that make sense?

Speaker 2:

It does. I think if I if I try and look at it from a very basic level, when you see uh uh agent, gentic AI engaging with a brand or the with the consumer, do you do you perceive there to be uh like an agentic AI on the consumer side and one on the brand side, or just on the brand side being pushed out to the consumer? How does that play?

Speaker:

Yeah, I th I think there are a couple of interaction patterns to um uh to unpack there. Um and the most I wouldn't say the most simple one, but the the most early ones right now are are agent to site, where where these agents are offered uh by aggregators. Uh take um take perplexity, for instance. Um is building capabilities in space as well, where these agents uh um communicate with consumers uh based on uh data that they have uh from these brands. Uh, another interaction pattern could be where a consumer interacts with a brand-owned agent. Um, and there's there's a lot of benefit to unpack there in the sense that these brand agents, of course, should have a much richer context of a particular customer in terms of uh previous purchases, uh, of any historical cases, um, any profile that you've built up of these customers, also in terms of loyalty or membership, that you could enrich that conversation with. Um, a third pattern could be uh agent-to-agent, uh, where there's a consumer agent talking to an agent uh of your brand, um, which is a bit of an intermediate pattern because there you you would have some increased uh span of control or agency as a brand over that conversation, but you still do not uh fully own it.

Speaker 2:

And the the agent to agent conversation seems that's that seems to me like the furthest uh away from uh us getting to that there's so many variables around that. Um no, so obviously understanding that helps. Uh so whether you see AI already making the biggest impact on on the the CX piece right now, not what's coming right now.

Speaker:

Yeah, yeah. Um well I I think this this there's two two sides of this coin. Um this is a personal opinion. I do think that truly agent commerce where agents where where consumers trust agents with a certain mandate to to execute a full transaction is still quite far away from us. Um I've I've seen some exploratory data that um that tries to model the probability of such a transaction happening, uh, and I think that is less than uh 0.02 percent, something like that. If you stack all the elements that need to be in place uh for a customer to fully trust an agent and be fully capable of executing that transaction within a given uh context. Now, on the other side, uh we do see that uh consumer behavior is shifting quite rapidly, uh, and particularly on the discovery side uh of things, uh people uh start more and more uh their purchase journeys in um in a gentic environments.

Speaker 2:

Okay, okay, so uh would you be inclined to give me your view on time scales? I think we've kind of used the phrase some way off.

Speaker:

Yeah, um sure. Uh I think it has also uh a dependency on the maturity of uh the protocols that are currently in development. Uh and there we see some some competing uh uh protocols emerge. Uh ACP on the one hand, which I think is um uh is pushed forward by by OpenAI, uh very much designed to have early capabilities in place to technically execute that transaction. Uh on the other side of the spectrum, we have Google's uh APP2 that uh is more of a holistic view of how an agency future could look like. Uh and that is thinking about the entire infrastructure of um provisioning mandates with certain budgets attached, uh, the reach that these agents are allowed uh to operate within. And I think that is a more solid foundation for agentic commerce that can act uh within uh the guardrails that we all need to set up. Um timelines. Um we do see some early experimentation with with ACP, so I do expect 2026 uh we'll have some some major uh lighthouse cases uh around early stage agent e-commerce. Uh at the same time, I also think that 2026 we'll see some say one or two scandals from major brands in which uh agents went haywire, um customer satisfaction dropped, and uh the thinking about the entire life cycle of these transactions or purchases falls short when um the wrong projects have products have been bought or a mandate has been uh overwritten in a sense that or overspent, I should say. So 2026, I think experimentation with ACP uh 2027 and onwards, I think we'll see some mature AP2 cases in in specific industries.

Speaker 2:

Okay, well perhaps we reconvene at the end of next year and and see how you're getting on with that prediction. Sure, I'd love to.

Speaker 3:

Yeah.

Speaker 2:

Okay, my last question on um AI and customer enablement. Do you think the AI-powered data products will drive the next wave of personalization?

Speaker:

Okay, help help me understand what you exactly mean by by data products. Is this um the data you service within your own ecosystem to, for instance, personal personalize, or are we thinking about uh more or less digital twins of the products and services that you sell? I'm thinking about the former.

unknown:

Okay.

Speaker 2:

Um the the the things that I've seen from clients is is products that sit over their data to help them rationalize, uh understand, provide clarity to the data. Because what we seem to see is uh clients have either huge swathes of data that's not particularly well organized or understood, or they have no data and now they're really trying hard to work out how to get it quickly. Yeah, so that's kind of where I was coming from with that.

Speaker:

Okay, yeah. Yeah, so coming coming back to your earlier question or um or prediction, maybe even on how 2026 probably will be a year where we'll see quite some substantial um re-architecting of commerce fabrics. I think that has a lot to do with the convergence of three major uh developments. Um, one is on data, one is on experience, and one is on uh utility. I'll start with the with the letter. Uh with utility, I mean the maturity of uh composable platforms in a sense that has become a lot less cost intensive uh to build composable API-first uh platforms. The second experience, um I think we're seeing all across the board a dramatic drop in the costs associated with uh generating high-quality, consistent personalized content. Uh, of course, much through generative AI uh capabilities. Uh, and the last uh data, I think there we see something similar in the sense that um the availability of um atomic real-time granular data products has become an economic feasibility. So if we marry these three, we can surface real-time data uh in context chunks specific for a particular uh customer's intent or context. We're able to are moving towards uh cost-effectively generate generating personalized context content, sorry, uh, and attach those to the APIs and services that a brand is able to provide uh to bring uh a utility uh through a product or service to life for the particular customer.

Speaker 2:

Okay. And how much further has the cost element got to go on that? You've seen a big drop-off in the cost. Um is that kind of plateauing now? We've kind of seen that increase.

Speaker:

I think that I think I think there's still room uh to optimize, and uh there's a couple of elements uh attached. One is that we slowly see uh specialized models surface. So rather than having foundational large language models uh churn out uh this content, whether it's text, video, uh, images, audio, uh, or a mixture of those, uh specialized cost-effective models can be deployed, lowering um uh the marginal cost of uh content generation. Secondly, um I think it's important to note that personalization for the sake of personalization uh never is a good idea. Um, so uh specifically targeting on what part of an engagement with a customer you feel personalizing that interaction makes sense uh and and uh should channel your investment in personalization towards uh is a second lever in in lowering that overall cost, I think.

Speaker 2:

Okay. Okay. That that does make a lot of sense. Um in terms of going back to the experience as a differentiator, we've talked about the commoditization of e-commerce. Uh, from your perspective, what what would define a great digital experience in 2025?

Speaker:

We're almost at the end of 2025, right? Um I think um let let's attach it to the earlier notion I I I surfaced on the commoditization of of the transaction. Uh so I think great experiences um should be relevant, real time, in the moment, uh, and contextual. Um very much focusing on either pre-purchase uh or post-purchase, uh, but at the same time also be able, regardless of where a customer uh is servicing, uh, to transact um on the terms uh that customer is ready for at that particular moment. Uh it doesn't it doesn't mean for me that you'd overly try to convey uh um uh brand narrative. Uh I think it should be very much focused um on the products and services that you sell. Uh and in that sense, another interesting trend, I think, to keep track of in 2026 and onwards is particularly for Europe at least, is early experimentation with uh digital product passports that are leveraged as a personalization and communication channel. Interesting. So you uh uh almost like a single sign-on type approach. Um I think single sign-on uh is somewhat of a hygiene factor uh in that sense. Uh I think when I when I talk about digital product passports, um there's there's both a push and a pull. Uh and the push I think comes from from legislative or regulatory uh bodies that that demand um transparency and provenance of the products and services that you sell. There's also a push from a consumer perspective where customers want to be informed on the origins uh of their products. Uh they want to better understand if uh this particular, let's let's say a running shoe um fits uh my need to get back in shape or fits my need to want to run the half marathon uh of Amsterdam next year. At the same time, it doesn't stop uh at the transaction. I think these uh DPPs can continue to uh collect data uh on on their usage to become somewhat of a um of a journal of the journey that particular product has traveled before you bought it, when you used it, and perhaps even when you decided uh to resell it uh or discard it or or repurpose it.

Speaker 2:

Okay, so personalization at scale is quite expensive, expensive, and we know that margins are tight, we know that uh the cost of money is high. So how are you advising and and how do brands currently balance the cost with the potential ROI?

Speaker:

Yeah, I think this um uh this flows back to my earlier remarks on on dropping the cost of generative personalization in in terms of um building trust to rely on on smaller specialized uh models, uh, but also on um on very specifically trained um uh ML algorithms that you want to deploy. Uh and on top of that, uh as I've said before as well, um we Razor Sharp in where a brand thinks personalization makes sense. Um and that has, I think, less to do with um uh telling a particular brand story, but more to do about placing a product in a customer's context, making sure that you understand what their preferences are in terms of payment, uh delivery, uh, and um after sales.

Speaker 2:

Okay. I just had a thought on the product passport, so I'm gonna take you back there quickly. Sure. You're you're talking about provenance of products. Um we're talking about considerably then things like sustainability, carbon footprint, um, and uh consumers understanding where their products are coming from, what kind of damage they might be doing to the environment, for example. Yep. So having a product passport, is that is that something that's now more feasible because it's going to yeah, it's going to leverage leverage blockchain to provide that passport and that unique um assignment to an individual or product. Is that what you're you're thinking about in that?

Speaker:

Yeah, there are there are there are some some providers indeed that that um uh that have blockchain technology at the foundation of their of their DPP offerings. Uh and it it makes sense in a lot of ways. Uh, one, of course, it helps to build trust on the quality of the data as it's immutable and you could also verify uh its origins. But secondly, and that's maybe you more important from a post-purchase perspective, uh it be it can become a shared ledger uh in a sense that a product can travel from owner to owner um as well as the uh the data um whether it's transactional um or on origin uh or on usage uh can travel along with that ownership uh a bit like how we currently track the service history of a car for instance yes yeah okay and is is is the product passport feasible without blockchain uh yes it is yeah sure yeah but but but not fallible or more more more fallible um i well it it it's more of an implementation pattern i'd say uh uh than uh than a particular preference uh i do personally believe that uh blockchain technology will make it a lot easier to make uh the data passport uh transferable uh as well as um let's say become part of a bigger community maybe even uh of users uh and usage uh of of the products that they represent okay um if we if we go and look at the composable stacks for a sec the i mean it from my perspective they they seem to be maturing um and that's happened quite quickly yeah what's been driving the adoption in your view um i think mostly um what i've what i've mentioned before i'd say if if we go back 10 12 years in the area in the era of experience led platforms that were um trying to to to deliver uh turnkey solutions um connecting the econ platform with the experience layer in in one package meant that as a brand or retailer you were also handing the keys uh of your own roadmap to the innovation roadmap uh of these providers um and that that led to uh that digital sea of sameness uh mentioned earlier as well so there there's a big drive to differentiate uh also because these platforms turned out to have rather high uh TCOs and shaping your commerce fabric exactly around the needs you think you need to surface um made a lot of sense. Now for 2026 and onwards I truly believe that a Gentec uh will be an accelerator for composable adoption uh as you're handing over an important layer of your stack uh to these aggregators.

Speaker 2:

Um and that means that you effectively need to turn your own organization inside out to make sure that uh agents are able to grasp uh not only your brand uh but your products uh your services your service levels in such a way uh that they can act as intermediates between you uh and your end consumers okay and in in your experience are businesses actually ready to go through that um restructure their teams uh in order to be able to fully fully unlock the the benefits of the uh the work they're going to undertake yeah yeah I think I think uh from from from my experience that is um is the biggest blogger blocker uh moving forward um and I guess it it ties a bit into into Conway's law uh in a sense that any organization that is designing a system will produce a design whose structure uh is a copy of the organization's communication structure and and these structures uh I think are still very much grounded in in linear thinking uh and composable or or rather building the digital commerce ecosystem requires you to think about what capabilities do you need to surface where uh how to capture that intent and provide the ability to transact so the operating model uh needs a uh thorough overhaul as well um blending both from a horizontal and a vertical uh perspective these capabilities uh for instance fulfillment options uh can become a crucial factor in determining during discovery for a customer whether or not they would even consider their product um so I guess these operating models would need to organize more around intent uh rather than uh journey phase uh so think for instance in terms of we'd have a search team we'd have a checkout team regardless of the channel uh instead of a web store team uh we have an in-store team uh etc okay and and on on the note of uh for channels um um um kind of kind of finish off with this question because it's something that i'm really interested to get your view on we we've seen social and live commerce um to varying degrees depending on which country that there's still people that are talking about it as the future uh and we've had plenty of different channels come to market that have been the future that have not worked out as anticipation what's your view on on social and live commerce yeah um I think at least for uh for Europe um it's at the moment pretty close to to a graveyard of other great initiatives of commerce innovations that didn't make it um think about meta metaverse commerce uh think about IoT commerce or uh TV commerce um however if we look more towards the east um in in China or Southeast Asia uh social commerce and live commerce has become mainstream so I think it's very much um a concern of of cultural adoption uh rather than technical feasibility uh and I think what is a red threat across all these innovations uh I mentioned is that yes the technology was there uh but the the human need uh was overlooked uh so um adoption I think still has a long way to go for for Europe um and a and a large enabler for that I think would be to think more in terms of product market fit so some categories obviously fit social life commerce much better uh than others um and that means also that uh brands and influencers um need to think about how to build trust on these platforms um and I think there we all could benefit from from standards and regulations that might help uh establish that base level of trust um sorry go sorry go ahead um but but ultimately I think um in the end uh when it becomes just as reliable uh as shopping uh through an app or a mobile site um uh traction will uh will pick up and um uh ideally it will become a more entertaining version of shopping. So in your view to for this to become mainstream is product market fit um and then the whole product passports piece play into that that could be that could be an important enabler yeah um and it but but also uh the audiences that you want to target so i think there's there's quite a difference to be seen between the success of of tick tock uh versus instagram for instance whereas instagram effectively um uh departed again from from social commerce a bit whereas tick tock uh I think is seeing revenue in the billions at the moment yeah and and I I I don't use TikTok so I wouldn't be able to tell you what um the consumer view is on why that is the case what's your view on why TikTok has had the success that Instagram has failed to have yeah I'm I'm not a TikTok user myself either I guess we're um a bit too old for that uh Tim uh but perhaps that that's that's part of the the answer I think there's there's different audiences uh that are uh using these channels with with different expectations as well the second thing when when when thinking about social commerce uh and its its success on TikTok is that the the products being sold there are very much uh impulse driven uh trend sensitive and fast shipping uh SQUs that um gravitate around certain price points that are easy to consume as a as an impulse by okay makes sense and it would explain why I'm not on TikTok uh or I'm not understanding why TikTok is successful because it's definitely not aimed at me. I I'm certainly not going to jump on any time soon I I don't need another reason to be on my phone to be perfectly honest. Yeah yeah we're gonna finish on that um it's been a really really interesting conversation and actually I've come away learning a few things so uh it's really appreciated thank you for your time and uh hopefully we can do it again and we can we can review the predictions that we made in 2025 sometime back end of next year.

Speaker:

Yes that sounds like an excellent plan that's it my pleasure and thanks for having me you are welcome thanks uh thanks for coming on the show cheers Rob cool thanks bye bye

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Tim Roedel

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