Jethro Marks: People are not prepared to wait three weeks anymore. People now want stuff quickly. If what you're doing is actually working, you just keep doing it as opposed to trying to adjust to whatever people think you should be doing.
Nathan Bush: It's usually the co founder that comes on the podcast is the one that doesn't do anything.
Jethro Marks: I think there's a key there where you've got to separate between the fad or the short term thing and what is going to be a sustained change in the market.
[Voiceover]: Welcome to ADD to cart, Australia's leading e commerce podcast that express delivers all you need to know in the fast moving world of online retail. Here's your host, Bushy. Hello everyone and welcome back to ADD to cart. My name is Nathan Bush, otherwise known as Bushy, joining you from the land of the terrible people here in Brisbane, Australia. Today we are lucky enough to be chatting to a true Australian e commerce pioneer, Jess Ro Marx. He is the co founder and the
Nathan Bush: CEO of the Nile.
[Voiceover]: Jethro has spent, get this over 21 years building an empire that ships 60 million products to 120 countries. Can you imagine being in e commerce for 21 years? Well, I don't know. Do we call him the Godfather? Maybe he's the Godfather of e commerce. Today, Jethro tells us how the Nile are on a mission to becoming the leading online bookstore in Australia and New Zealand. Plus the we don't often go into
Nathan Bush: this territory, but we get a bit
[Voiceover]: of industry gossip, with Jethro sharing how the Nile actually bid for the Booktopia business when they went into administration. It's a great conversation there because we talk about the frenemy concept between Booktopia and the Nile and how they're in the same category but they actually learnt a lot from each other and I think that happens a lot in Australian e commerce. Apart from that, Jethro shares how his annual trip to Shop Talk in Las Vegas keeps him connected with the global e commerce scene.
Nathan Bush: Sounds like a good excuse, doesn't it?
[Voiceover]: He also talks about the strategy that helped the Knoll become the leader in online retail and how the business has evolved through several different waves of digital commerce. From the early days of ebay to the current era of multichannel selling through to major platforms like Catch, Kogan, ebay and Amazon. Jethro has seen it all. If you've ever wondered what it takes to build a business from scratch, but not only build one, but keep one
Nathan Bush: through many cycles of uncertainty, this episode is for you.
[Voiceover]: All right, before we get into it, firstly our e commerce Social in Melbourne is next week. We still, I think we still have
Nathan Bush: a few tickets left.
[Voiceover]: It's on Thursday, October 17th at the corner Hotel in Richmond. Come join us and meet other ADD to CART listeners. We've got an amazing panel featuring Mike from Xeroco, Emily, Elvy, Nathan from Pear, and Dom from calibre. Tickets are $20 at the Corner Hotel, Richmond on Thursday, October 17th. Head on over to add to cart.com to follow the link to buy yours. A big thanks to our longtime partners Shopify and Deliver in Person for making this podcast possible. Let's jump straight into my chat with Jethro Marx and hear how he's kept the Nile at the top of Australian e commerce for over two decades. Jethro, welcome to Add to Cart.
Jethro Marks: Thank you. Thanks for having me.
[Voiceover]: Long time coming, as we said in
Nathan Bush: our pre chat, but in our pre chat we kind of got a bit off topic and we're like, oh, we better start this interview because we were talking about Vegas and your adventures in Vegas at Shop Talk this year. That sounds pretty wild.
Jethro Marks: Yeah. So I've been going to. Let's back up a step and explain what Shop Talk is. I mean, Shop Talk is one of the. I think it's the best online retail. I mean, not to disparage all the local providers who I love and have very good relationships with and attend everything. But this thing's just on another level. It's got 10,000 plus people, it attracts all the best of the best of the best. And I use it as an acculturation once a year to get plugged into the US market and get a real sense of perspective. I think one of the problems I run into here in Australia is you spend all the time at the local events. And I think I fall into the trap of thinking this is the universe. And then you step out of it and you realize, actually, hang on, we're just a very small microcosm in a very big space. And so I kind of, I use that as an annual event to go and get perspective on the world. I mean, a big chunk of our business is in the US and it's just one of these things that even with that, one can easily lose perspective of the scale of things. So I've been going after Shop Talk probably for about six or seven years. I used to go other conferences before that. Since I've discovered this one, I've kind of just stopped going to the other ones and just focused on this one. And we've been getting a really solid cohort of Australian Retailers going up and vendors each year. And it died. Obviously. Covid brought everything to a halt for a couple of years and then it's sort of building its way back up again. But I encourage absolutely everybody to go up because it's in March, it's in Vegas, which is fun, three or four days. If you're a retailer, you can basically get it all paid for because you just have to take a bunch of meetings with vendors and the vendors all fascinating because like I said, you're getting the best of the best. So often you'll end up talking to the local salespeople here and then you go over there and you actually meet the mothership. Like you get to talk to guys who are leading the charge. And actually the insights in terms of direction can be very different and just the insights in general. So it's a fascinating experience. If you're open to learning and this is your space, then I'm like, I reckon 110% that's the place to be.
Nathan Bush: So the fact that there's a whole bunch of retailers that you're friends with, plus it being in Vegas has nothing to do with it. It's all the learning opportunities.
Jethro Marks: Well, it's a work hard, play hard situation. You do as much, you get to meet the Americans and everybody from around the world and you actually spend a lot of time with the Australians because we end up sort of as a, as a group hanging out quite a bit. So you end up connecting in a way with a lot more of the local guys than you would normally see during the course of the year anyway.
Nathan Bush: Oh, and you told me that there are media passes available as well. So that caught my attention. But let's talk about the Nile. So 21 years of the Nile, which is just incredible in the e commerce landscape and it makes a lot of sense. What you need to go to the US to constantly refresh and to think of new ideas and to be exposed to new thinking. Because 21 years in any industry is a long time, let alone the e commerce industry. Tell us when you started the nile. Back in 2003, Amazon was 10 years old. So not a baby by any means, but nowhere near the beast that it is today. What inspired you to start the Nile?
Jethro Marks: So what happened was I came back from an eight month backpacking trip. I was living in New Zealand at the time and I thought to myself, I either start a business or I get a job. You know what, I've got three computers, a few grand in the bank, let's have a crack at this Business thing. If it doesn't work out, it doesn't work out. I'll go get a job. It's not the end of the world. And so I reconnected with a couple of guys I've worked with a couple of years just after uni who we used to do something in a company vaguely similar to what we do at the moment, but not really. And we started off, three of us, three guys in the room, three computers, I think we had four computers. We had a few thousand bucks in the bank and we started and the business plan was highly sophisticated. It involved finding anything we could fit in a box and try sell to someone somewhere in the world and try and make a few bob in between. Like if you could just sell three and out would be good.
Nathan Bush: Is your background in tech or is it in retail?
Jethro Marks: Neither. I just did a commerce degree at uni, really had an interest in doing something. I kind of fallen in love with E commerce as a concept at the time. I think it was sort of the dot com crash had occurred and we were in the period where it was considered to be. How do I describe it? It was like a period where everybody thought this was a done thing. Like it was a fad that had come and gone was the general consensus at the time. And we looked and said, well maybe, but things still seem to be moving. You can access the world through ebay and Amazon and whatnot. So it wasn't that you weren't able to transact, it just wasn't attracting the level of attention it had in the late 90s. And off we went.
Nathan Bush: Kind of feels like we're coming out of one of those cycles at the moment with the COVID boom and the excitement around E commerce during COVID and now the shift back to physical retail. You must have seen plenty of these cycles in that time.
Jethro Marks: I kind of think about it in three or four different waves. I mean there's a lot of granularity in between where stuff happens. But that first period when we started up, I think it was being the kind of. I've called it the age of serendipity. It was like the period where you would serendipitously buy stuff because hey, you could go online. It was like, it was cool 2003, if you could buy something online that was a special occasion. And it may turn up, it may not turn up. It may be well priced, it may not be, but it was like a whole eclectic experience. And that kind of went for a few years. And then in the start of 0708 we had the GFC and then that was the first kind of real pivot in the whole industry where things moved from being serendipitous to one to being priced. Everything was price, price, price. And during that period there were the rise of the Groupons Ausales, those kind of businesses catch kind of came into its fore.
Nathan Bush: You're going to call it the Leibovich era.
Jethro Marks: We can call it that. Yeah, Gabby definitely built the bulk of his business at that point. But yeah, Hunt the Labovich era, let's call it that. What you had was a glut of inventory in the market and everybody was cash poor. So there was. Brands were prepared to discount advice rates in order to just drive cash and move product. And so it was a ridiculous thing. You had these businesses which said we've got like a walled community because you had to log in. But they had half the market was already in it. But the brands convinced themselves, I think that this was a safe way to move product without bastardizing the brand. Which it's one of these situations where you had no evil, see no evil. But it all happened. And that resulted in that model kind of proliferating, becoming the mainstream. And that was the thing to do. And I remember we were going along doing our thing end at the the time we looked at this, maybe we should try this. We looked at it, we couldn't. It was completely the wrong way of approaching the problem toward the way we dealt with things. And so we just couldn't get. It was like we'd have to either set up a separate organization which we didn't have the wherewithal to do, or try and under rewrite the DNA of the organization that we ran. And eventually we just couldn't make it happen. But if you could characterize it, it was go on find a deal of the day or a period of deals, heavy, heavy discounting. And you got it when you got it, maybe took three weeks to get delivered whatever it was, which all worked up until the GFC ended.
Nathan Bush: Worked for the retailers.
Jethro Marks: Worked for the retailers. Well it worked for the consumer as well. I mean because the consumers were getting great deals at the time. The other thing. So the GFC was actually an interesting period because we grew outside of COVID That was the second biggest period of growth we've ever had. Because what happened. And to this I applaud Kogan and Jerry Harvey. They managed between the. The interaction that they had to explain to the consumer that if you wanted to get stuff cheaper, you go online. So all of a sudden you had people who were like, very value conscious, very concerned about their jobs and about their. Not quite to the same level of issues we're having at the moment, but it was that mentality was driving things. And so all of a sudden people started buying online who had never been there before. That drove everything up in terms of volumes, get out of the gfc. And all of a sudden we now move into where we are at the moment, which is the age of convenience. People are not prepared to wait three weeks anymore. People now want stuff quickly. Amazon hadn't really arrived yet, so that the buyer hadn't been raised to that level. But already we could start to see that consumers were much more focused on convenience rather than on price. And I think to this day, that's kind of what's driven things. So you think about once upon a time, your selection was that drove your Model two. It became your price, became the drove you Model three, then it became the convenience factor, all the three, the holy triumvira of things. And now all that's table stacks. You kind of have to do all of it. It's not enough to do each one of those things by itself. It's got to all plug together in a perfect way to be able to make it very compelling from the consumer.
[Voiceover]: And I feel that's what's coming out
Nathan Bush: in a lot of the reports. They're talking about value, right. Customer wants value, but no one can really describe what value means to them. It means something different to everyone. And I think what you said there about those three, three eras of product price, convenience, it's like all of these have to come together now. So it's not just, you can't just be the cheapest and ignore the other two. You've got to find a way to bring all of them together to give value to your customer.
Jethro Marks: Absolutely. And I think with that as well, like, it's not. I guess one of the observations I've had is that consumers behave in multitude of ways. So our strategy for many years had been about being everywhere, being omnipresent in every channel that people wanted to buy. Wherever you want to buy, that's where we want to be. So we want all the marketplaces domestically, globally, that were significant before the whole proliferation occurred. We had our own sites. We just basically said the ethos is we will be where the customer wants to be, and we don't necessarily need to be the winner in any one particular market. If we distribute it across enough places and pick up enough business across the board, it all comes together. That was our sort of proposition to consumers versus some of our competitors who said, you know what? You've got to be got to purchase on my site in order for us to give you the experience that we want. The thing is, neither of these are wrong. There's no right and wrong here. It's such a big market, you can kind of adopt a whole bunch of different strategies and some will work, some won't work. And just because you haven't done this one doesn't mean that one's wrong or right. You follow the data and figure out what's working. I think that's been one of my key learnings throughout the entire time. It's like whatever the conventional logic says. And I remember there was a personalization craze. Everybody had to be personalizing stuff. We don't personalize that past. It's just what does your data set. When we started up, coming back to earlier point, people said Amazon is here, they own the book market. What are you doing? You're wasting time. And I said, well you say this, but my data supports a different outcome. I'm seeing sales coming in on a regular basis. I'm scaling this thing. So it might be that the conventional logic is it's a winner takes all. But our experience has been it doesn't a winner takes all. And that as long as your data supports what you're doing and if what you're doing is actually working, you just keep doing it as opposed to kind of trying to adjust to whatever people think you should be doing.
Nathan Bush: So I'm interested in your strategy at the moment because you know you talked about that be everywhere to everyone from what I saw on the outside now selling to 120 countries, 60 million plus products ranged your own website which is custom built and the look of it, plus Amazon, ebay. I'm sure there's more marketplaces that I'm missing. How do you decide where you are going to be and direct your efforts at the Nile?
Jethro Marks: So I think the way we started out, we were a marketplace only business to begin with. So ebay and Amazon to begin with. And then over time we built our own site. We rolled onto other additional marketplaces as they became viable for us to sell on. So we're on Catch and we're on Kogan. We love all these companies even though we're frenemies with half of them. And then that we're in coopetition. We, we sell, we compete in the morning, we cooperate in the afternoon. But coming back to it, like I think the Consumer is where the consumer is. Our view is that we want to be there and sometimes it'll be under our brand and sometimes it won't. But at the end of the day, if we can move a box and make some money and make someone happy, then that's a better outcome than worrying too much about whether it's now branded and arriving in a Nile box and that they. That is nice to have, but it doesn't need to be the thing that happens. It's got to be just that, you know, we. We satisfy consumer demand as and where we can. So over time, we've kind of just. We've evolved this and so we've rolled out new sites and we've added new marketplaces. As marketplaces go out of business, we've removed them or some don't work, we've removed them. It's just an ongoing sort of ebb and flow and there's no, you know, you just kind of do something, you test it. If it works, you do more of it. If it's not working, you do less of it. And that's a very pragmatic approach, I think, is what's kind of allowed us to survive this long and keep going at it, rather than trying to be too dogmatic about the way we approach it.
Nathan Bush: And in terms of your time, where do you spend most of your time? Do you spend most of your time in the product world, the marketing world, the tech world? Where do you like to play the most?
Jethro Marks: It depends. I think Paul Greenberg's analogy is the one I always come back to, which is that of spinning plates. So, you know, the. It's like a question of where. Which plate needs adjusting at that point in time and where the opportunities present themselves at that point. So at the moment, we are fixated on becoming the best online bookstore for Australia and New Zealand. That's our current ethos and that's everything we're working on at the moment. So we used to do that as part of a bunch of other things that we've just said, look, this is now currently the most important thing we can be doing. So that's what we're working on. So that's where my energies go. And then I'm sure once we get to a point where that project is, it's got to the level we need to get to, my attentions will go somewhere else. I'm very lucky to have an amazing team who've been with me for many, many years, including a business partner who I've been in business with for 21 years. So I get to chase shiny balls and sort of chase flies or whatever. You want to choose your analogy in terms of things. And they get to make sure that things actually happen rather than relying on me in which case nothing happens.
Nathan Bush: Okay, so they're much more operational and in the detail. Are they? And you're more strategic and growth.
Jethro Marks: That's probably a nice way of putting it. They'll probably just tell you that I don't do anything and that they do everything. So it's just a question of who you ask and what your perspective is.
Nathan Bush: It's usually the co founder that comes on the podcast is the one that doesn't do anything.
Jethro Marks: Sure I am. Okay. We can't.
Nathan Bush: We can't let it slide. Obviously. Huge ambition there to be the number one bookstore. Online bookstore in Australia. In New Zealand. We've obviously just had the Booktopia saga. You know, from the outside. I think we were all in awe of what was built over a number of years there. Especially with the challenges around Amazon and the threats of Amazon. Plus some big legacy book retailers in Australia. They did a really good job of infiltrating the Australian market before everything unraveled. Did you put a bid in to take over Booktopia as part of that vision?
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Jethro Marks: We absolutely did. But unfortunately we weren't successful in our endeavor. But it's just the way it goes. Everyone looks at something and attributes a certain value to it and they attributed a higher value than we did and they got the deal. But look, we got. Booktopia is one of those. We start up around the same time as they did. I think they were within six months of us. And we've known Tony and Steven Wayne and all those guys forever. And we love them to bits. They're all wonderful people. But you know, they. They went on a certain path and things ended up where they were. And it's very unfortunate. I'm very sorry that it went that way because it's not. It wasn't good for anyone. But that's how the market works. And you Know, maybe the guys have taken over, will do a great job of it and good for them. I think it's a big, you know, come back to the same thing. All these markets are big markets. None of us are dominant players in the space. So, you know, there's space for many of us to be able to do things in different ways. And it's just as true in the more developed markets like the US and the uk, where the likes of Amazon have got a much more dominant ship. Barnes and Noble is still there, they're still in existence. To take if we're going to keep running with the book example, there is plenty of space to be able to do things. You just can't necessarily sit in your laurels and assume that doing things in a specific way are always going to work indefinitely. I think that's where a lot of companies could have come unstuck. Ability to be able to be pragmatic, not hold on to sacred cows and just kind of keep moving with where the requirements are that the market is basically to check and I think is very, very important.
Nathan Bush: I'm hearing a lot of Paul Greenberg isms coming in. I feel like you've influenced each other a lot over the years. Tell me more about Booktopia in terms of what you saw. Obviously you followed that journey as a competitor and a friend over all those years. What parts of the Booktopia business or experience do you go, that was really special. That is something that we would love to see continue on.
Jethro Marks: In Australia they had a very customer focused approach to doing things. I mean, we do too. It's not to denigrate my team's efforts, we do as well, but it's just that we have a different approach to how we did it. And I think that that up until the end that was kind of what drove their success. They were very fixated on providing the book by something and I think that that was a great thing. They built a great business. The underlying business wasn't the problem. They just made a bunch of decisions that didn't work out.
Nathan Bush: Is that mainly around the warehousing and the operation side of it, do you think?
Jethro Marks: I don't have any inside information beyond what I've read and seen and spoken to the guys. My take is that it was not any one specific thing, but if you look at them, there were a series of decisions that seemed to have been made where they placed some very big bets which didn't necessarily pay off and maybe lost a bit of the focus that had got them to where they got and again, it's one of these things where sometimes the outcome isn't necessarily due to anything anybody did specifically wrong. Sometimes the market just moves against you. You make a decision, you make a bet on the assumption that certain things are going to happen and then they don't happen and then. And you lose out. So yeah, I'm very sorry it happened and I hope to leave. The legacy will continue, but in the meantime we'll just keep doing what we're doing.
Nathan Bush: No, absolutely. And I think you've summed it up really well. There is to use another Greenbergism. It's around the rising tides, helps all ships and I think they contributed to that as the Nile have over the years in making it stronger for Australian E Commerce. So there's definitely a legacy there and I've got no doubt that you picking that up and filling that space will extend that legacy even more.
Jethro Marks: Yeah, it's an interesting point just to segue slightly off that, but I think what I've noticed when I go to most conferences each year and in the beginning, going back 10, 15 years ago, it was founder operators that I would see most of the time. And today they're in the minority. What's happened is over the course of time this industry has grown so fast and it has brought so many new people into it that you've got people in all different levels of the businesses and they're bouncing around. They're all amazing, amazing at what they do. Like far better than we were while we do, we were doing then. But obviously the market is, they're more specialized and they've done. And so the talent pool is phenomenal. The people in the industry who are so inspirational, who I meet all the time for the first time ever, because I walk into the rooms, I'm like, I don't recognize anybody here. And I can start talking to them like, oh yeah, I've been around for eight years, nine years, like how is it possible? Like I didn't ever see you. But you know, it's just one of those things where it becomes so big and you know, the merging of what E Commerce used to live by itself as a silo and then retail did its own thing over here and now today it's like it's all the same thing. I mean the terminology shifted whether it's currently unified, what was Omni previously multi channel fulfillment, blah blah, blah. It's always been the same thing, but now digital.
Nathan Bush: Please don't say it.
Jethro Marks: I'll leave that to you.
Nathan Bush: I'm really interested in the product Selection, because you talked about the importance of data and using that data to make decisions in your business. And what's really surprising to me is that you're still selling books, obviously, but Also things like CDs, DVDs, what others might see as legacy or declining categories. You're obviously seeing something very different in your data. What data do you look at when it comes to merchandising and stocking the right products?
Jethro Marks: So our first approach is we don't pick winners. Our view is the consumer. Our view is we aggregate supply and allow consumers to decide what they want. And so the decision making is not so much. It's more at a category level, like, do we want to partake in a particular category? So take DVDs as a good example. Like, it appears to be a dead category. It is really in serious decline, and no one in their right mind would be investing in that space. We made those investments 15 years ago, and we haven't had to really do anything to it since other than upkeep because, you know, the relationships with the suppliers are there. It all just kind of trucks along. It's all algorithmically run. And in that particular market, it's an interesting one in that there is a. An amount of the business that is declining on an annual basis. So you wouldn't enter into a sunset industry. But if you're in it, you can still continue to profit from it for a period of time while the existing participants exit the market and the base of consumers while declining. And while the market is declining, still buy stuff. So there's like a period where JB hi Fi left the market. There's still a bunch of people who buy on a regular basis. They've got to buy from somewhere, so they might as well buy from us. And that actually is one area we probably won't be in for too much longer, just because we've now reached the point where it probably doesn't make sense. But from our view, there are certain areas where we put a lot of focus and to continue to grow. And there are somewhere we just get it in and then we just let it do its thing. And then unless all of a sudden there's a spike. Actually, I'll tell you a funny one. So DVD is kind of just ticking along, doing their thing. And then in April 2020, when Covid hit for the first time ever, we had a DVD in the top 10 of our selling items. And I was like, right, that's very unusual. So I looked into it a bit more closely and it turned out that The DVD was Contagion. So I think what had happened was people were looking for an answer as to what was going to happen next in the start of COVID And so they went and got the one movie they really shouldn't have seen because it's got a terrible ending, like it's not at all positive. So I don't know if we contributed to people's misery at that point. I would hope not.
Nathan Bush: You know what you should have done? You should have got all the contagion DVDs and just changed the ending to give people a bit of hope. It all works out fine,
Jethro Marks: made it Disney instead.
Nathan Bush: And tell us about how you manage your supply partners. Because 60 million products, but going through your website, going through the Nile, they're not junk suppliers, they are big name brands a lot of the times and with quality products and, well, you know, household names.
[Voiceover]: How do you manage that?
Nathan Bush: Because they've got options everywhere similar to what we were talking about. They could sell wherever they want. What makes them go? Actually, I think that will be treated well and represented well on the Nile.
Jethro Marks: It's a very good question. So our initial starting point is we only work with branded product and we only work with branded product that we can buy in one of the four countries that we operate warehousing. So we don't import our own product out of Asia on our own brands or anything. We are literally just buying branded items where someone has already gone to the effort of creating a quality product with a great brand story. And then over time we enter certain verticals or certain categories. And initially it's always hard, it's always difficult because to the point you made, they're like, well, who are you guys? Why would I want to potentially denigrate it? But then over time you add more and you create a house of brands. And then, you know, as they see, you know, five or six or seven of their contemporaries in there, then they feel more comfortable about it. And so, you know, as we've gone into the various verticals, whether it be toys, baby homewares, kitchenwares, it's kind of worked that way. With books, it's a little bit different books. We, we've been in there since day naught and there it's just about aggregating the large, the full supply of available product anywhere in the world. With the brands we're a little bit more considered because we're looking more for the quality end of the product set that we can get in there. And sometimes it works and sometimes it doesn't. Like I said we don't pick winners. So if the consumer responds to the offering, then great. And if they don't, then we should move on.
Nathan Bush: The not picking winners is interesting because it's falling into the department store model online a little bit. And obviously the narrative around department stores at the moment isn't fantastic. Unless you're a Kmart or a, heaven forbid, Atemu. What's the difference for you in marketing to a department store style customer? Are you meeting specific needs? So, for example, I'm typing in that I need a pillow and they're our audience, or are you trying to target a certain kind of customer or demographic to shop the range?
Jethro Marks: It's somewhere in between. So I think we often get mistaken for being a marketplace, which I think we are in some respects. Like we're, we're sort of a somewhere between a retailer and a marketplace and that we aggregate a lot of supply. We don't necessarily hold all the inventory, but we've got tight relationships with all the suppliers to make sure that we can meet customer demand, meet customer expectation. So if we say we're going to deliver by Tuesday, we need to get it to by Tuesday. And we do it in a way where like a traditional department store would be kind of aggregating six or seven categories into one store. We seek to aggregate millions of SKUs into one offering that we then allow people to buy from across a multitude of different channels, wherever they're happy to go and buy from. So the way I see the space is that each of the different platforms that we sell through our own site, whether it be ebay, Amazon, they've all kind of got their core demographic of people who are very comfortable in that space. An ebay customer will always be an ebay customer and they may occasionally look at other ones, but that's generally where they feel comfortable. Amazon's got its core base. If you kind of think of it, there's a Venn diagram where everybody's going, got their call and then there are overlaps where somebody might shop between the two. So our view is that we just want to put a lot of product up in front, a lot of good quality product at good pricing up in front of all those customers across all those different channels to be able to allow them to purchase from us in a way, shape and form that they feel comfortable with makes a lot of sense.
Nathan Bush: When it comes to your own website, I'm assuming that is generally more profitable. If customers choose to shop directly with you, how do you position your USP there to shop via the Nile because I noticed you don't have a loyalty program which seems to be the go to at the moment for a lot of brands trying to get people to shop direct. How do you position the Nile DTC experience for customers different to other experiences?
Jethro Marks: Very good question. There's what they're what we are today and hopefully in time in the near future this will be very different. So our view has really just been about having an EDLP and everyday low priced on a wide variety of products and allowing consumers to find when they go looking for their products. If they do through, you know, through Google or wherever we happen to be advertising at that point that they will then come through and find their products on site. So we've kind of behaved a little bit like our market place behaves. That's changing. So we're rapidly moving. There's a lot of development going on. You'll see a readers maybe even the time this comes out. The site will be redeveloped and redesigned
Nathan Bush: by the end of our chat.
Jethro Marks: Maybe not by the end of the chat but at least by the time. Give me a little bit more time actually. Good point. Let's get the RT guys on straight away. It's been in the works at the moment, so we're redesigning and redeveloping that and on the roadmap will be a lot more of the traditional things that one would associate with the D2C play that we typically haven't really worried about so much in the process past.
Nathan Bush: And your website custom built and you've been in the game and like you said, set up with four computers, four laptops, sitting around developing the Nile 21 years ago and you've been custom built ever since. You would have seen a lot of trends and a lot of changes in tech over that time. Back then you kind of had to be a little bit nerdy to spin up a website, even let alone an e commerce offering with payment gateways and all the rest integrated into it. Become a lot easier today in that anyone can spin up a site within an hour. Have you ever had moments of going oh I wish we weren't custom?
Jethro Marks: I remember we did this piece of development that took us close to two years like it was just an ongoing thing. I swear within two months after having rolled it out finally and got it where we wanted it to be, some guy came out with a product for 50 bucks a month which did essentially the same thing. And I was looking like why are we doing this? But you know, some of this is go back to the legacy we Started out, the options at the time, and this is really showing my age, were basically enterprise software which we couldn't afford, or it was Yahoo Stores which was a complete load of crap. Like it was the first version of what eventually Shopify became. But it was like the worst of the worst and so we had to do it ourselves. And so then progressively over time you build out a system which gets more and more complicated, which is positive and negative. And so you're always running into this trouble. So you look at re platforming two or three times. It's like each time you eventually end up in a situation where you're like, okay, this thing does 90% of what we want better than what we do. But that 10% is going to make this unworkable. Like they just can't do what we need to do. And if we don't have that extra 10% then we just, it's not going to work like at all, period. So you kind of end up where you are with what you've got. I think overall I enjoy the flexibility. I get a bit frustrated sometimes where we have to develop functionality which would be able to just plug in an Apple CESS product or whatever. Correct. You just go into the ecosystem and just push a button. So instead we've got to go and do a whole integration with the set of APIs. But we're getting better at it. We're getting better at kind of playing nicely with other systems so that we can take best of breed and go. You know what, we don't want to be developing or maintaining. This is something that needs to be done by somewhere else and we just need to kind of plug into it and use it to the extent that we can.
Nathan Bush: Yeah.
[Voiceover]: And has having that kind of control
Nathan Bush: helped you as you expand into all those markets, like 120 international markets that you ship into? That sounds like a logistical nightmare, let alone a technology nightmare. Has your custom platform given you the flexibility to be able to do that more easily or has it made it harder?
Jethro Marks: In this case it's made it much easier. There are things you just wouldn't have been able to do. So the way we work is we have sort of four core markets which are the English speaking markets. Australia, New Zealand, us, uk, Canada, so is the fifth and then we sell globally. And with the core markets we've kind of come up with very bespoke shipping solutions which we run ourselves. So if you look at our shipping solutions, they look similar. I like to think better than some of the third party providers that are out there that we would otherwise have to use. And then for the vast majority of the other countries we are using third party providers because we just haven't got the critical mass to be able to support being able to do it yet. So as a as we get better at a particular market and we get certain levels, then we can switch on some of our more bespoke solutions. And none of this would be possible if we'd just been stuck with the existing platforms that were out there at the moment. We use multiple platforms to do various things, but it's about how you string it together in order to get a cohesive, consistent outcome.
[Voiceover]: Ever been tempted to productize any of
Nathan Bush: the developments that you've done for the Nile to sell it to other E commerce friends we've looked at in the past?
Jethro Marks: We tried doing it a couple of times. I guess one of our core weaknesses here is that we just we're very fixated on doing what we do.
[Voiceover]: When you think of your last E commerce experience that went wrong, how did it go wrong? Was it because there wasn't enough product images? Was it an out of whack mobile experience? Was it that one rogue negative review?
Nathan Bush: I doubt it.
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Jethro Marks: the problem is I've tried to get stuff in projects in and various things into the existing flow, but because it's contrary to the way we do things, it ends up breaking everything. So we end up saying well look, if we're going to do anything it needs to be outside of what we're doing here and we just haven't kind of got it. So we've tried. We may in the future, I don't know, it might work. I mean it does make sense. Like I said, what we're doing is very comparable in the shipping space and some of the international markets. We do some things that are Very, very similar to what our, the third parties that supply into the market do. So I mean, it seems it might be something that's just not, it's not the current focus.
Nathan Bush: And because you're across such a wide range of categories. Right. I could imagine that the application is so broad, but I don't see it as a weakness. I know you called it out as a weakness, but I actually think it's a strength to be able to go, this is our focus, this is what we do. You know, you called it out yourself. You said, we've got the goal right now of being the number one online bookstore in Australia, New Zealand. Like for a team, that's pretty amazing to hear you go, that's our focus right now.
Jethro Marks: I have to keep saying it over and over so that I'm not tempted to try and do anything else.
Nathan Bush: So it's not for the team, it's for you.
Jethro Marks: If I can convince myself of something, then usually I can convince others. But it's coming back to the shiny ball. I do sort of see the opportunities. Sorry. More broadly speaking, that's the most amazing thing about this industry. If you look at any chart of online penetration to retail, it's upwards and to the right with the sole exclusion of maybe 20, 22 when we came out of COVID and we dropped back a bit but like our numbers were back to Covid levels again. Like we went down substantially. 22 when everything unwound and now we're back to where we were. So it's like it's non stop trajectory up into the right. So I think as that has happened, the opportunities have become much easier and to a point you made earlier, like the ease and ability to be able to do things like if you're a Shopify merchant, you want to sell into America. Two, three things, Ben, you're into it like it's. Everything's lined up. Your tax issue, go talk to Avalara, your shipping issue, go talk to the three or four providers out there that do this and you could put together an offering within the space of a few days. Took me years to do that. Years. Why? Because we had to do everything from scratch and build it all out. So now today it is truly the land of opportunity in terms of doing whatever you want to do. On the flip side, everything's more competitive, everything's a lot harder now. You've got higher cost of acquisition, you've got more players, everyone's a lot more sophisticated. So you've got to be on your game a lot more. We could get away with a lot more before that. You can't today. But I think that's always the case. Things always get more competitive as they go. But I think there's no shortage of opportunities. And you know, with if we're sending to 120 countries, everyone can send to 120 countries. Like all you have to do is just enable shipping to 120 on your eBay store, your Amazon store, whatever, and away you go. You just have to be able to support it going forward.
Nathan Bush: But to your example before, around developing for two years and then someone comes in with a plugin that's $50 a month. I could imagine that that flexes a muscle in you that you have to be very critically aware of the trends and the fads in E commerce that you choose to double down in. It's not like, oh, we can play around a little bit with this. It's like, no, we're actually all in on this or we're leaving it behind. It's either a black or white decision rather than a little dabble along the way. Do you think that's made you hyper aware of analyzing decisions and actions and not just following trends because everyone else is doing it?
Jethro Marks: Yeah, I think there's a key there where you've got to separate between the fad or the short term thing and what is going to be a sustained change in the market. There aren't that many sustained changes in the market. The market kind of operates the way it has been for long. And like I said, coming back to the personalization example, there's some great personalization businesses out there. Tiny Me guys run a brilliant business. Love it. Very, very in awe of what they do. But I mean that's the race they're running. But there was a time when everybody said this is the thing that's going to happen or the catch the day, not catch the deal of the day type site. That was the thing. And you kind of got to go, well, a, is this significantly shifting what I'm doing? Like, is this existential threat to my business? And if the answer is no, then you go, okay, well is this an opportunity I want to pursue? And if the answer is yes, then figure out a way to do it. That's probably one of the things that we haven't been good enough at. I mean you take back to the Dubovich here and those guys have been phenomenal. Just spinning up new ventures and then the one rolled into menu log and then that got sold to just eats for the most insane valuation anyone's ever seen. So there's obviously a lot to do there. But at the same time that takes away from the focus. So you kind of come back full circle and then just say, well, what does my data support? Is this, whatever this thing is, is this going to be any threat to me or an opportunity and then assess it and move accordingly. So I think again, just being kind of pragmatic, humble, be humble. I think humility goes a long way and just being persistent in what you do is sort of the main kind of underpinnings of success.
Nathan Bush: That's awesome. That's brilliant advice. I love that. I want to touch on a slightly different topic, just out of curiosity. You're the non executive director at Drone Shield and I'm like, oh, I just saw the name and I was like, we've got to hear more about this. I almost went to like look at the website. I'm like, actually no, I'm not going to look at the website because I want to hear it from you. Tell us what Drone Shield is and how your relationship there came about.
Jethro Marks: I highly recommend you go look at it because it's the most amazing set of systems and to see what it's all about. So that was. It's a listed company, it's in the defense tech space. It works in detection and defeat of drones, smaller sized drones, and primarily sells into military and there's some civil applications as well. Where it goes into places like airports and the like. I got on board with them about four and a half years ago. So it was a relatively small micro cap at the time. I knew the guys who ran it and the opportunity arose and I got on board and sometimes it's just a question of timing. These guys just persevered and kept doing the same thing. And then all of a sudden Ukraine kicked off and then that became drones became very apparent now in Israel and around the periphery there you can see what's happening with drones and all of a sudden it's gone from being a thing, which is nice to have, to all of a sudden it's becoming a thing that people have to have because drones are one of the new waves in warfare and in other applications. So this company, when I joined it was probably trading. They're putting a market cap of about 100 more. In its peak a few months ago, got as high as 2 billion. Just a phenomenal, phenomenal story. Just a company that's come of age, the right time with the right tailwinds, with the right tech. Just absolute world leader in what it's doing at the moment. It's becoming competitive. They were the only guys in the space for years but now the industry grows around them and all of a sudden you've got 100 competitors you didn't know you had the day before. But the key, it's just an amazing business in terms of very R and D focused. They're in an arms race with the drone manufacturers to make sure that whoever system can defeat all the drones that are out there. There's a proliferation, it's a fascinating space but just really an amazing ride. Completely everything about it is completely different to what it do on a day to day where I deal with consumers, where we take money up front and it's all very quick. These are long sales cycles selling it to defense which can take years at a time. But just an amazing, amazing product with an amazing team. So really very privileged to be a part of that very different version of
Nathan Bush: what product success looks like as well.
Jethro Marks: Correct. Just got to put into ASX 300 a few days ago. So yeah, really interesting.
Nathan Bush: Well done. I love that because yeah, I was on the deep dark depths of Reddit this week which you never know what will throw up. One of the trending stories was actually a Russian soldier lying in a ditch. I'm not sure if anyone else saw that who was actually surrendering to a drone like so trying to work out, you know, how do I show that I'm surrendering to a drone. So it's, you know, exactly like you said. It's just this whole new world of, you know, of combat and the way that that international relations will unfold and to be front and center of that with drone shield in Australia is just phenomenal. I just couldn't imagine going from that world into back into E Commerce. And I was, I'm going to ask it anyway. I was going, I was like this is a stupid bloody question coming off the back of that. But drones in E Commerce, will they have a role in the next five years?
Jethro Marks: That's been talked about for 20 years. Right. I think that's, that's been. I look, I don't know. I think there were definitely use cases where it makes sense, you know, if you want to get something out to a certain area regionally that you know, doesn't support someone going over there and driving you. That makes a lot of sense. I can see the use cases. I just haven't. I'm doubtful we're going to see anything in the immediate future simply because I don't a couple of reasons. I think the Technology is probably there now. I think there's a lot of regulations around the use of drones and where you can, where you can't, how you deal with it. And especially in Australia, which is the land of regulation and regulations upon regulations. Doubtful that we'll be a world leader in terms of how that gets rolled out. That said, I was talking to someone who's working on something in Europe. They seem to have. They were quite, quite adamant they were going to get something across the line. So, I don't know. Look, I think autonomous vehicles make sense. I have a high level of conviction and I hope that my kids never need to get a driver's license. I mean, that would be awesome. Autonomous vehicles are there by then. So if the next 10 years or whatever we can get to that point where Ubers are basically just autonomous vehicles around the road, then that'd be great. If we get to that point, I think maybe the application would make sense in a variety of different ways, whether it be on the middle mile, like around trucking, or whether it's light drone delivery by air, as you would imagine it, like a small drone dropping and stuff. Or maybe it's what was described to me is like light aircraft, which do just purely cargo, but are autonomous and therefore can drop their cost of doing things. I think there's a ton of application. I'm just not convinced it's going to be within the next five years.
Nathan Bush: That makes a lot of sense. I love that perspective. You know what I was just thinking as you were saying, that the inverse relationship between youth drinking at the moment, obviously drinking is going down amongst youth and autonomous vehicles. So we're going to have this generation that doesn't drink but has drivers for them everywhere.
Jethro Marks: Well, we're going to be the ones using the driverless vehicles. I don't think it's going down our generation, but yeah, you're right. No, that's very funny. I hadn't thought of that.
Nathan Bush: As Jethro, I love this chat. It just brings such great perspective to the industry that we're in. But also I think some of the wisdom that you shared around longevity in our game and how it's not flash in the pan that you've got to build something that has longevity. But have your moments of focus really stood out to me. So thank you for sharing that. Obviously you've got that big goal over the next however long to be Australia's number one online bookstore in Australia and New Zealand. What does the next 12 months look like for you?
Jethro Marks: Exactly. That just heads down focus on that, building out all the capabilities that we don't currently have, improving on what we do and just getting the entire team entirely fixated on this customer experience and how we improve it and that I think for anybody listening to this, no matter what business you're in, that should be the start and end of every day. Like it should just be, am I improving the customer experience in some way, shape or form? And if not, then I don't think I'm doing the right thing. That should be the absolute north star for every single business. And it's easy to say. It's a lot harder to do.
Nathan Bush: Yeah, absolutely. All right, apart from going and meeting
[Voiceover]: you at Shop Talk in Vegas next
Nathan Bush: March, what's the best way for people to get in touch with you or to learn more about the nine?
Jethro Marks: Well, for the Nile, check out the site thenal.com, but for me, by all means, reach out through LinkedIn. Very easy to find, always open to discussions. If anybody wants to have a chat, found out about more the business you want to find out, you've got just questions in general, you're looking for some help. I don't know if I can help, but you know, we'll try. What I'll try and do what I can and if you do want to find out, come along to the trip to Shop Talk and by all means, reach out. We'd love to hear from you as well.
Nathan Bush: Lovely, Jethro, thank you. It was great chatting and about time we got you on Add to Car. So thank you for coming on.
Jethro Marks: Thank you so much for having me. It's been great.
[Voiceover]: Super interesting chat with Jethro there. I've known Jethro for a long time, not closely, but we've run in the same circles and had a few conversations over the years. But that was the first time I've really got to sit down and understand the story in full and what a story it is. I love how ambitious he continues to be after 20 years years to put it out there that he wants to be the top bookstore in Australia and New Zealand. I love that the passion and the fire is still burning. All right, here are the three main takeaways I think we can take from that discussion. Number one, focus on your core strength. While the Nile has such a wide range of products shipping to so many countries through so many different channels, Jethro shared how they've recently narrowed their focus to becoming the leading online bookstore in Australia and New Zealand. This strategic focus shows that even though it is a massive business with so many options and so many possibilities. Being able to communicate not only to your team but as Jethro said, to keep it in his mind. One clear purpose and vision is so important to making sure that something comes to life. Life that you don't try and do everything and then become nothing. All right, number two Be everywhere your customers are. Jethro's philosophy is be everywhere that the customer wants to be and it is the cornerstone of the Nile's success. While the Nile is one of the first D2C businesses in Australia, they haven't held on to owning the customer through their channel only. Or this time they sell across multiple platforms like ebay, Amazon, Catch and Kogan, which allows them to reach a broader audience and move product as it needs to be moved. You've got to keep your mind open to new opportunities to sell your products and reach new audiences, whether that be marketplace, wholesale physical stores. Just because you are grounded in one channel such as D2C doesn't mean it's always just gotta be that. And number three, Learning from Global markets Staying connected to international trends is a high priority for Jethro. As we heard he regularly attends events like Shop Talk in the US which allows him to keep a pulse on what's happening in global e commerce rather than just being in the Australian bubble. By engaging with retailers and innovators all around the world, Jethro is able to bring back fresh ideas and insights into the Australian market and get ahead of those trickle down trends that we tend to see a little bit after those leading markets. And it's played a huge role in keeping the Nile competitive. So if you are after a little bit of secret sauce, something that others in your direct competitor set here in Australia might not have, maybe it's time to look overseas for your next piece of inspiration. Thank you so much for tuning in. If you enjoyed this episode, please share it with your colleagues or friends. And don't forget to leave a review on Spotify or Apple Podcasts. And of course a big shout out to our fantastic partners Shopify and Deliver in person as always for their continued support in bringing this podcast to life. Before you go, we'd love to invite you to join our free e commerce learning platform Add to Cart Campus. Meet other professionals and learn from e commerce experts to take your business and your e commerce career to the next level. Register to join campus at add to cart.com aucampus now. If you enjoyed today's episode, make sure you share it with a friend or a colleague. Or even better, leave us a review on Spotify or Apple, it really makes a difference.
