[Voiceover]: People don't necessarily want to hang around bottle shops. They want to get in, they want to get what they need and they want to get back to home. The event, the party, you know, the reason why they are there is to facilitate something better outside of the bottle shop. So I think keeping that in mind is key.
Damian Smith: It's very difficult to control the demand side. It's hard to influence that. Just because we could implement some different widget on one of them, it's not going to make much difference. But what we can control is our costs and that's what we have to do and it's working really well.
[Voiceover]: I do think we've got the recipe right there. It's simply exposing ourselves. I always second guess myself when I say we're just exposing ourselves.
Nathan Bush: I think we've got our opening quote for the episode.
[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.
Nathan Bush: Hello everyone and welcome to another episode of Add to Cart. My name is Nathan Bush, otherwise known as Bushy, and I'm joining you from
Nathan Bush: the land of the terrible people here in lovely Brisbane, Australia.
Nathan Bush: Is it too early to be talking
[Ad]: alcohol on a Monday morning?
Nathan Bush: Today I have the pleasure of speaking to not just one, but two of the masterminds behind what is one of the most interesting transformations in Australia today. I am lucky enough to be joined by Erin Williamson and Damian Smith, effectively Marketing Director and CTO of Paramount Retail. Now, you might not know Paramount Retail yet, but you will definitely know their brands. Booze, Bud and Barrel and Batch. They've now come together under Paramount Retail and are undergoing a massive, massive transformation. Today they are going to show you how to transform a traditional D2C E commerce model for some well known brands while doing it on a budget and staying true to customer expectations. But first, a little bit about our guests. A bit of a Swiss army knife in business and tech, Damian has over 25 years of experience. I always love catching up with Damien. From founding an IT services business in the 90s to leading a CIO at Surf Stitch and CEO at Mountain Bikes Direct. And he's now driving the future of E commerce at Paramount with his versatile skill set. Erin has over 20 years of leading brands like Betfair, Luxury Escapes and Cars. 24. From a marketing perspective, she's now on a mission to bring drinks to kitchen benches all across Australia. I love their dynamic and I think it's really interesting how they're looking to transform these brands. So in this episode we are going to look at how each of their brands, Booze, Bud and Barrel and Batch aim to differentiate themselves through convenience and availability. It's definitely not the traditional D2C go into physical market approach. We talk about how they've come off a really complex tech stack and are now leveraging Shopify to simplify not only their tech but their business model and their delivery processes. We talk about how Booze Bud's next day delivery trials with our friends over at Deliver In Person are helping them stay ahead in the increasingly competitive alcohol market. Some people with some big pockets in that world. And we talk about why brick and mortar stores play a big part of their future growth strategy. Now, if you haven't already, I would love to invite you over to sign up for my weekly newsletter. Every Tuesday morning I will send you a newsletter at 7:30am on the dot with my thoughts on a topic that's facing the e commerce industry as well as five key links or stories that I think you need to know about. As an e commerce professional in Australia, you can sign up for free at add to cart.com, as always, a big thanks to our partners, Shopify plus and deliver in Person for making this episode possible. Now let's go jump into the chat with Aaron and Damian from Paramount Retail.
Nathan Bush: Aaron and Damian, welcome to ADD to cart.
[Voiceover]: Hello, Bushy.
Damian Smith: Thanks, Bushy.
Nathan Bush: Great to have you guys here. Two for one. How special is that we travel?
[Voiceover]: We're like a pack animal. What can I say? We, we travel in a pair, Damo and I.
Nathan Bush: You friendly animals.
[Voiceover]: Oh, very friendly animals, yeah.
Damian Smith: Good day.
[Voiceover]: All right.
Nathan Bush: We are going to get straight into
Nathan Bush: it because we've got so much to cover today around Paramount Retail, but also all the brands that fall under that and what you're doing in the alcohol sector. I'm going to kick it off doing a lot of research on what's been going on the last couple of years. No denying that it's been a bit of a turbulent time for some of your brands. Tell us about those last couple of years. What has been the transformation and where have you ended up?
Damian Smith: So I was actually one of the early customers of when I was back in beer but a decade ago, which was a great time for craft beer. It was a great way to find craft beer. But I joined BoostBud a bit over two years ago in 2022. Business had been through a lot, been through Covid massive expansion and it was basically a race against time to get the business to A sort of point of sustainability. Had private equity behind the business and it was all going well, but we just ran out of time effectively. So the main sort of change from there through the administration and Paramount taking it over is a big shift into simplicity. So to. To move into a profitable position that the business had to simplify massively. So Boost Bet had big internal development team. You know, that can be quite expensive. We very quickly moved to Shopify in a bit over a year ago, and it's a much simpler business now. So we have a fantastic external development partner creator and so we can effectively now run two websites for the budget of one. So for those. But it's much simpler. It's worked well. From a customer perspective. The website works the way you expect the website to work. The old site could be a bit challenging for new customers. So the conversion rate's better. We get a lot of positive feedback through customer surveys. So it's been a lot of simplifying the last few months.
Nathan Bush: When you say you ran out of time, do you mean from a customer loyalty perspective or is it an issue with the craft beer sector or a combination of everything going on?
Damian Smith: At the time, it was mainly just a funding issue. So there was a massive boom through Covid before I joined and it was. That was tailing off so early 2022. People went back to what they were doing before. They were stuck at home. They could get out and do things. So the market shifted and so we were trying to really rebuild the company which had grown through that sort of boom and just redesign the business to work for a much smaller market segment that we found ourselves in.
Nathan Bush: Makes sense. And you said you simplified the business. Still doing the beer advent calendars?
Damian Smith: Yes.
Nathan Bush: Oh, thank goodness for that.
Damian Smith: Yeah, yeah, they are coming soon. They're coming soon.
[Voiceover]: Coming sooner than you would expect, actually, as I got an email on that today, so watch this space.
Nathan Bush: I used to help Stone and Wood with some of their marketing and we used to always keep an eye on Booze Bud to go. They've just gone with Christmas. The advent calendars are out. It's getting real.
Damian Smith: Yeah, yeah, yeah.
[Voiceover]: Cool.
Nathan Bush: What about yourself, Aaron? What about from your side? Obviously, Damo looked after COO and CTO side. You're on the marketing side. What does the transformation look like for you?
[Voiceover]: Oh, well, I started with Paramount as a consultant. So while Damo has kind of got that Booze Bud DNA and he came into the business from Booze Bud, you could say that I came into the business originally to solve what we call the Hairy Dog problem. So Hairy Dog was Paramount's competitor to Booze Bud and so it was kind of like a little brother. It was cheeky, you know, the branding was, was really cool, but probably just didn't have enough budget behind it to execute to the degree it needed to. And as DAMA referred, massive wave of E commerce probably gave us a false sense of, of success now, you know, cut to say 12, 18 months later and then we've acquired Boozebud. So we've essentially got two brands that do exactly the same thing that are really trying to be the same character in market. And so that was one of the early projects that I consulted on. It's like, how do we reposition this brand? And the key to that transformation was looking at, I think two things. Firstly, the product range was spectacular and at that stage I think we had over 7,000 products. But it was full of rare and exclusive and hard to find things that you couldn't get anywhere else. And so that naturally led to probably a more discerning customer, someone who really identified with alcohol and it was part of their Persona, I guess. So then you go back to brand and you realize that Hairy Dog was just a bit knock about, you know, it really didn't fit this customer that took alcohol quite seriously in a good way. So that's kind of, we'll say major transformation number two, but we have more transformations in store which I'm sure we'll get into in this discussion.
Nathan Bush: Surely when you had Hairy Dog and Booze Bud on the table, there was conversation around creating a brand called Booze Hound.
[Voiceover]: There was, oh, that's probably the only name that we didn't consider Bushy.
Damian Smith: So thanks very much for that consulting, mate.
[Voiceover]: There we go.
Nathan Bush: Just had another brand in there.
[Voiceover]: We're up to kind of, you know, over well over a hundred names when a certain opportunity presented itself. And a boutique whiskey business called Barrel and Batch was founded by a guy called Ray Daniel, who is one of Australia's foremost whiskey experts. And I suppose like us, he'd riven that COVID wave and was trying to figure out what to do on the other side of it. And so having that beautiful sense of craft and you know, even the term Barrel and Batch speaks beautifully to wine as well as it does whiskey. Ray came down and suddenly all our problems were solved. We had a fantastic differentiator in our premium whiskey business and we had a ready made brand and I was very pleased because, you know, put that to bed after 18 months of trying. So that was good. Okay.
Nathan Bush: So now you have Booze Bud and Barrel and Batch, two very separate brands. Do you find much crossover there in the customer?
[Voiceover]: Yeah. So how I'd answer that is that there's a distinct customer across both websites. But what we decided to do for, for Booze Bud is do some market research and figure out where the growth was. So we knew that we needed to pull the two brands apart and be very, very purposeful about who we were going after. And the Barrel and Batch customer was showing all the right behaviors. They were highly engaged. There's a high degree of repeat purchase. So we're like, cool, that's cooking. Well, let's sort of, you know, put that to the side and. But for Booze Bud it really needed like far more an acquisition focus in that repeat purchase is kind of low. So without that steady stream of, of new customers, we'd really find ourselves plateauing.
Nathan Bush: Yeah. Great. Okay. And you mentioned there before, Erin, physical retail as part of the transformation. Where does that sit?
[Voiceover]: Well, I didn't, but also I did quite a no behind the scenes. I did. So you've just outed me la launching physical stores. So I mentioned stage. We'll talk about it as stage three of our transformation. So as if we didn't have enough to do, we have decided for both brands to launch physical stores, which can seem probably a little bit backwards to the rest of our E commerce colleagues that are listening. Obviously, you know, the traditional way about it is you knock up a store, it's fantastic, you grow and then at some stage you venture into ecom. And what we found is that our wider business has got an interest in banner groups which is kind of like the franchisee model by which major bottle shop sort of offerings work. So we have an existing bottle shop there and that kind of positions us somewhere between banner groups and the chains. And we think for suppliers firstly that there's a way that we can do it better and that's to launch corporate owned stores. So you've got flexibility of a smaller player. We're very nimble, you know, very flat structures, lean team. But then we can deliver the consistency that a supplier is looking for in executing their brand well across promotions and, and marketing. And I think from a consumer perspective we've done a lot of research in this space and the biggest motivator for how you choose a bottle shop is what's close. So you'd be so surprised. Bushy like price is very. It's not a huge consideration factor. Loyalty is not a huge consideration factor. Range isn't so you know, we thought that as a new player we can be incredibly choiceful and strategic about where we put these stores. So we feel like as a late market entrance that's actually going to work in our favor. So yeah, we have a bottle shop near you launching soon.
Nathan Bush: Pretty much how good when it comes to choosing the location for stores. Obviously bottle shops aren't a new sensation and Coles and Woolies have most corners tied up. How do you come at it from a new angle to find spaces that people haven't thought about before?
[Voiceover]: Yeah, sure. So I think we're looking at a mix of 50% greenfields, 50% acquisitions. So acquisitions are great. Obviously I don't think there'll be any Coles or BWS stores being handed over to us, but there's certainly a very fragmented, a lot of smaller players of owner operators that are looking to move on. And I think also we have probably certain market advantages. That means that we are guaranteed to be successful in our relationship with our wholesale parent. But yeah, it's doing the legwork. So where is this place? Does it have great access? Is it on a thoroughfare? Is it the centre of a village? Where are the competitors? What's the demographic? And we do that by a mixture of kind of street research. We do a lot of suburban demographic research. We lean on our E commerce agencies for, for their view as well. And we do really, really strict commercial due diligence and we're lucky that the senior members of our business have, you know, are entrepreneurs and have been over multiple businesses in many years. So they definitely they know what what good looks like.
Nathan Bush: Awesome.
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Nathan Bush: You mentioned that convenience is really important when you set up a new store and then Damo you talked about coming Back to core principles and simplifying the tech stack so that I'm assuming you can be more nimble and agile with what you've got. Where do you see yourselves pop playing in terms of overall differentiator market? Because you're in a competitive category, like margins are tight, you've got big players in there, you are transforming. How do you get to be known as different in your market?
[Voiceover]: I'm going to answer the first part and then I'll kick to Damien for the second part because I do think digitization and tech stack is a key component. So for me, I am very, very clear eyed about what is a USP in this category and the maturity of our competitors and against most of my marketing instincts, which would say get that usp, you know, if you don't have one, find out what's important and then create one. We've been very, I think, kind of straight up with ourselves that this is not necessarily a category that needs usps. Even when you go to your dusty boxes everywhere, crappy products overpriced, even when you go to that little bottle shop that everyone has had to go to at some point, there's still 82% satisfaction in the category. Why? Because you left with a bottle of alcohol 99 times out of 100. So I think the first part about differentiation is to quote Mark Ritson, who I'm obsessed with, it's not necessarily differentiation for us, it will be brand distinctiveness that we're going to focus on.
Nathan Bush: What does brand distinctiveness look like for you?
[Voiceover]: I think it's brand hygiene. So for us it's again, we're up against players that do this incredibly well, but we're up against a lot of players that don't and that can't control the brand because of the nature of their fragmented business. And I'm talking specifically to banner groups there. We are going to create a streamlined brand that we can afford to execute well. And I think that's a big thing. You know, don't start something that you can't maintain over many years. We are going to sweat those brand assets really hard. It's going to be about repetition and not changing the messaging too much. And it will just be based on a simple truth, which is this is very much in the boozebud territory here. Not barrel and batch. But people don't necessarily want to hang around bottle shops. They want to get in, they want to get what they need and they want to get back to home. The event, the party, you know, the reason why they are There is to facilitate something better, you know, outside of the bottle shop. So I think keeping that in mind is key.
Nathan Bush: A few damo from an online perspective in being able to be competitive and to stand out because obviously you don't have the physical round the corner. You've got to compete on SEO, you've got to compete on being seen in performance advertising, being known as a loyalty player. However it is that you acquire your traffic. How will you approach that?
Damian Smith: A lot of it's just like full transparency to the customer. So we have two warehouses, one in Sydney, one in Melbourne. That gives us a lot of advantages and flexibility, but it also provides a certain amount of confusion at times and right now the experience is not where we need it to be as far as providing that transparency. So if you're a customer, this is not a game changing type of industry. You just want your stuff and you know when it's coming. So. And that can be related to where is it coming from. So we're looking at transparency through the whole last mile delivery, but even bringing that right back to the cart. We work on a project right now to display in the cart where the items are going to ship from. So that will give us then the ability to offer next day delivery for certain locations depending on where it's shipping from. So we don't have the same stock in both warehouses. It differs. So sometimes it's a split delivery. You've ordered five things, two of them might come from Melbourne and three might come from Sydney. So with those situations, we automatically have a card go in the box to say, hey, I'm part of your order. So when you open the box and it's not all of your stuff in there, you've got the card saying, I'm not the complete order. There's more on the way still. So the panic goes away.
Nathan Bush: And do they get email communication on the split order before that?
Damian Smith: They do. So there are two separate emails, separate tracking, separate everything? Yeah, most people don't, don't check it until there's a problem. So they order, forget about it until they expect it to turn up and then a box turns up with part of the order and then it's, it's, you know, it's happened to me, it's a mad panic. Where's the rest of my stuff? So we're looking at all the different touch points to have that transparency and that's all about building trust with the customer so they know what to expect and they're going to trust us to give them what they expect.
Nathan Bush: Yeah. Is there any reason your warehouses carry different stock? Like if you had your time again, would you just have both warehouses carrying the same stock so you didn't have to do split shipping?
Damian Smith: That would be a lovely place to be. But it's complete fantasy unfortunately.
Nathan Bush: Just from an inventory holdings perspective.
Damian Smith: Yeah. So the wholesale warehouses from the parent company, so some products are going to be in both, but then one of them will sell out and then what? So we don't want to not offer that product when it's available in the other warehouse. So that's why we do it that way.
Nathan Bush: Tell us about having both sites.
Nathan Bush: It looks like you've got both sites on a Shopify plus design, sharing a theme by look. But you really have, you know, I can see the principles at play there around keeping it simple, keeping it unified, minimizing the overheads and maximizing team efficiencies in operating them. What's been the benefits and the drawbacks of that approach? Having two brands with a similar online design.
Damian Smith: So the main benefit is that we, we get sort of bang for buck. We can develop a new feature and it's released immediately onto both sites. This is a very intentional. Going back a decade when I was at Surf Stitch, we had two websites, one for Australia, one for Europe. They started out the same but then they diverged. One was always the poor cousin, so and it was always behind. It never got what it needed, it always struggled because it was double the effort. It was a really difficult way to operate. So it was very intentional that we're always going to have the one code base, the one thing, the one everything. For both sites, as far as compromises, there haven't really been any. The differentiation comes through the brand, the product mix, the features aren't really going to be a differentiator so much. It's very difficult to control the demand side. It's hard to influence that. So you know, just because we could implement some different widget on one of them, it's not going to make much difference. But what we can control is our costs and that's what we have to do. And it's working really well.
[Voiceover]: And I do, I want to give Damien props here as well because I'm definitely someone who might go like see something online or go to an event and I come back and I'm like, right, we need all this stuff. We don't even have a this or that and oh my God. And you know, Damien is just so clear eyed about going, you know, how much does that cost? How much margin would we need to generate in order for that to firstly pay for itself or secondly generate profit. And I think one fairly radical exercise that he suggested, he and I go through just as a bit of a, you know, thought thing, was like, imagine if everything stopped and there was just the website and he and I, so what, what would we do then to sort of build up and get the revenue to where it needed to be rather than, I suppose, chasing after ourselves to maintain this runaway thing that we have to pay for. And that's been really amazing in my thinking because of course as a marketer you think, oh God, everyone is doing all this stuff and I need to keep learning layering and layering. But just a simple how long will it take to pay for itself? Is sobering, very sobering. And I don't get many things that I suggest after going through that process.
Nathan Bush: It must be, you know, Damien, obviously, because you've got that background in a lot of custom websites and big complicated sites, must be refreshing for you personally as well to have more of a simple infrastructure where you're not losing sleep
Nathan Bush: over in the middle of the night.
Damian Smith: It's amazing to be able to, first of all, not to be getting up in the middle of the night responding to site down issues, but just from a productivity point of view. If we need to get something done, we can get it done really quite quickly. You know, we don't have to go through just the effort that custom software entails. There's a lot of custom things we're doing with Shopify, but just the fact that the, the core things are there and sometimes we have to sort of work around the edges a bit because you can't quite do everything you want. But we'll get 90% of what we want to be able to get without too much effort.
Nathan Bush: And the rest of the stuff you just say no to anyway.
Damian Smith: So sometimes we just have to look at it and go, we're talking to our Shopify partner and it's like, look, we could do it, but this is what it's going to take. And then we really look at it go, how much difference is that really going to make? Okay, just park that one.
Nathan Bush: Move on.
Damian Smith: Yeah, lovely, lovely.
Nathan Bush: Quick decisions too. Aaron. I love that thought around. If it was just you two running this, you know, how do you scale it, how do you grow it? When it does come to growth, obviously huge transformations, big shift in the sales channels that you're opening up and that you're considering as well. For you right now, what's more important is it retention of existing customers that have been with the brand and shop with the brand before and maybe taking them through this journey or is it acquiring new customers and telling them the new brand story and the new direction?
[Voiceover]: So I think it differs for both brands. Barrel and batch, I would say historically from Day dot had a very high retention rate. When you look at our cost per recipient via email, it's 10x what it is for Booze Bud. So I do think we've got the recipe right there. It's simply exposing ourselves. I always second guess myself when I say we're just exposing ourselves.
Nathan Bush: I think we've got our opening quote for the episode.
[Voiceover]: We're exposing a wider audience to barrel and batch because I do think I talked before about usps. This is a brand that is truly different in that it's got specialist level expertise per category, but you've got all the categories in one place. So you do see that speciality elsewhere for competitors, but they're usually just being narrow on one category. And I think the next part of the question gets more complicated. So we have decided as we're transitioning into bottle shops that the Booze by brand is no longer the best fit. There is another brand waiting in the wings that also starts with B and that is Bottle Stop. So this was originally designed to be a banner group in its own right, but we felt that it's one thing to order from Booze bud online and it certainly has come by its personality, you know, very authentically. It's probably another thing to be caught at 10am on a Tuesday popping into your local booze bud. I've heard that that might be a thing that people do. So we thought that, you know, Bottlestop was designed to be a mainstream physical store brand. So we're going to align the boozebud website with that. So I think that's kind of the background. The next step is that, yes, that obviously proposes a challenge. So the first part of the journey is managing our existing database to safety. When you go through rebrands and we have first hand experience, it's the perfect opportunity for customers to say too hard, opt out. Particularly in this era of scams and suspect emails and that type of thing. Approaching people as a new brand that they may not have interacted before and saying, hey, click here, your account's over here is, you know, it's challenging. We need to navigate that super carefully. But we have a really exciting future ahead. And I think it's, it's because the physical stores will become acquisition engines. There's Nothing better than experiencing a brand in person and then acquiring customers, reduce our costs for online acquisition, which are quite high. And we can kind of, I think, balance that ecom performance spend, which is super important and the foundation of what we do now for marketing, with a lot more sort of tangible, experiential stuff too.
Nathan Bush: So when it comes to rebranding, do you go out and make a lot of noise or do you kind of subtly change it over time?
[Voiceover]: So I think what we're going to do for Bottle Stop is very hard to make a lot of noise about what will on day one be a single store. So then when you're rebranding, there's always this sense of like, who cares? Like who are you shouting for or at? So I have a lot of local activation plan to engage those people who are driving past. But am I going to take out billboards Melbourne wide and go. There's a bottle shop in Barodia that you must visit. No, I'm not going to be doing that. And I think we also need to. You could waste a lot of money letting the online community kind of thrashing them over the head with it. But we know that when we have something that they need, be that rare or hard to find or whatever, that they will come knocking. So we kind of let online take care of itself and we will stagger the comms until we've got a degree of volume.
Nathan Bush: Makes sense. So when it comes to loyalty online and you're expanding into a physical presence and you know, what you said around convenience and location being key decision drivers for those physical stores, how do you drive loyalty for those two brands when you've got a mixture of both physical and online?
[Voiceover]: Really simple. I think you know who the customer is and know what sort of loyalty appeals to them. And it differs a lot for the customers. For each, the bottle stock boozebud customer is all about specials, discounts. They love that sense of points and getting rewarded and being able to spend points on purchases. Whereas the barrel and batch customer is all about acknowledgement and access and, you know, maybe being the first to hear about a particular sale or have a product release that is exclusive to them. So they make our jobs very easy in that sense. But the foundation of that pushy was just good old classic surveying. We did some really widespread market research to determine these differences and make sure that it wasn't just us or kind of guessing. It was designed purposely to appeal to them.
Nathan Bush: Makes sense.
[Voiceover]: I love it.
Nathan Bush: Okay. And Damo, we've talked a little bit about this before is loyalty programs. Are you a believer in structured loyalty programs?
Damian Smith: Like Erin said, it depends on the brand and the customers. So we've definitely seen a lot of enthusiasm with the BoostBud loyalty program. So for a while we were sending out some surveys to new customers just using a klaviyo flow just to get that feedback on the initial impressions. And there was a lot of just asked positive feedback around the points program. So that definitely is working. The advantage with tiered programs is you can measure the change over time. So the one thing that's always been difficult for us is to really know how the program is changing behavior or are we just rewarding behavior they're going to do anyway. So that's the hard bit. I think with a tiered program that would probably be overkill for the boozebud sort of platform and customers. But for Balant batch, as Erin said, it fits in with that really nicely that you can set up the tiers and have different types of rewards and we can then track that behavior change over time.
Nathan Bush: Yep. Okay,
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Nathan Bush: I want to switch out to shipping because I was fascinated when we were getting into that with the conversation around split shipping and you know, that's an extra complication on top of a category that's probably not the easiest to ship. You know, margins aren't huge, plus you've got a fragile product, plus you've got heavy, heavy.
Nathan Bush: Yeah.
Nathan Bush: And then you've got the over 18s piece as well. A lot of regulation around that so that to me, you know, it all adds up to a pretty complicated offering there. How do you find the right balance between offering a really competitive shipping proposition? To your point, Aaron, people want convenience, they want timing is really important, but also maintaining profitability.
[Voiceover]: I'll talk to the customer Pace. So the lovely thing about the products that we sell and our customers is that our revenue spikes over the age of 35. So the sweet spot is 35 to 54, a bracket, which I'm sure everyone on this podcast is in. And they are mature people who are quite willing to firstly have alcohol in the house and not go crazy and drink it on the spot, but also to plan ahead. So I think, you know, the impulsivity that you see in the younger demographic and certainly with delivery on demand within the hour or the two hour bracket, our customers, they've got the wine cellar, they've got the bar fridge, they don't really need that level of need it right now. So the other thing is again, back to the humble survey. We ask them what's more important? Do you need it quickly or is it more important that you. It might come, you know, within 24 hours or 48 hours, but you've got the certainty of knowing exactly when it will arrive. And I think for a busy person like myself who online shops, everything might be a bit agoraphobic these days. Just don't want to leave the house knowing exactly when something will occur, that it's not while a video call is in play, or it's not while I'm dropping the kids at work or any of those sort of things. That is worth so much more to me than arriving randomly within a couple of hours.
Nathan Bush: So it's more about communication and. Exactly to what Damo was saying, transparency.
[Voiceover]: Yeah. And reliability.
Nathan Bush: You mentioned the delivery on demand. What are your options at the moment for delivery?
Damian Smith: So right now we're just using the Auspost network, but we are working on next day delivery with delivery in person. So if we, if we rewind a few years, Booze Bud was doing same day delivery and that was really challenging. So first of all, from a legislation point of view, there are extra hoops that jump through for same day delivery, a lot of extra record keeping, ID checks, everything like that. So that is difficult space to be in. There's a lot of competition in there, a lot of people doing it very well. We're more about the range, et cetera. Anyway, so we haven't done Same Day since Paramount took over Boozebud, but for all the reasons that Erin just said next day delivery is really interesting to our customers. So we're currently trialing next day delivery with delivery in person in Sydney. We have a small sample of customers who realize they're going to get next day delivery. But hey, surprise, here's your order the next day.
Nathan Bush: So you don't tell them no.
Damian Smith: So we just, it's just, you know, a bit of, you know, good vibes. But it's a way for us to get the processes in place with delivering person, make sure the warehouse has all their systems worked out so that when we have the website project completed and we can then offer it on the website, everything's been worked through for some weeks so that it's going to be smooth and seamless from the moment we offer it.
Nathan Bush: Yeah, really smart to be getting ahead of it now because obviously what we're seeing with Amazon in market, just even if they're not in your category, they're changing expectations around next day delivery, even same day delivery now in Melbourne and Sydney. So great to have that as an option. What has been some of the customer feedback so far that you've surprised with the next day? Have they actually got in touch or they're just happily delighted in there?
Damian Smith: I haven't had any, any feedback come back through to me. I'll have to go and ask.
[Voiceover]: I can click that and tell you a little bit about the situation that led us to, to working with deliver in person in the first place. So when we launched our Advent calendars last year, we had taken over Boozebud, I think maybe in May. So in Advent calendar land, you know, the elves start stacking boxes somewhere in sort of July and we were really up against it. And the boxes were delayed at the printer in China. Then the ship missed the shipping twice. Then it was delayed on the docks because of a, what was it, a cyber outage or cyber attack on the docks. So basically everything that could go wrong did go wrong. And then one of the manifests was be it lost, be it not connected, I don't know. I let Demo do kind of the technical things, but what I did and why I remember it so clearly is I spent the two weeks before Christmas on the phones on a daily basis sort of calling these customers. And what we uncovered was that this is a traditional for so many of our customers, they buy one for themselves and they'll buy one for the father in law or for their brother or their husband every year. And they, they sit there and they drink the craft beer and they call each other up, take Notes compare. So we didn't realize that it was such a ritual and an important Christmas ritual for so many people. But letting those customers down was really heartbreaking and we sort of all reconvened and we knew that this year, apart from the fact that the boxes are in Australia now, so you know, we can get started a lot earlier. We, we don't want to go through that again. And I think for those high value products where it has to be there on time. Obviously Advent calendars are meant to be enjoyed from the 1st of December. I had prior experience with delivering person. I said to the team like we have got to start exploring an alternative. And that's really kind of where the conversation started.
Nathan Bush: And going back to our earlier conversation of not doing things if we can't afford to do them or if the incremental value doesn't add up from a margin perspective, how you don't have to give us the exact numbers but how does it compare to standard delivery?
Damian Smith: So we've got a little bit of work to do but it'll be like a small sort of shipping upgrade for the customer to get it next day.
Nathan Bush: Yep. Okay. So not a huge shift.
[Voiceover]: I'd also put my own hourly rate on the table and say if you can avoid things down or upstream happening upstream, then you know, you've got to factor in the cost of your customer service remediation when things don't go well. And certainly we had basically all the senior heads involved trying to fix this problem. So yep, you can, you can add that to the bill.
Nathan Bush: Anything you've had to change in your processes or the way that you handle dispatch to make sure that orders are ready for next day.
Damian Smith: Yeah, definitely. There's, there's a few tweaks that we've had to do. It largely fits within the existing processes but it's mainly around those time cutoffs so that everybody knows that you know, up until whatever the cutoff is that this happens, the orders get closed and the final picking is completed. They get manifested and labeled. So it's just getting all of that really nailed down within the team at the warehouse so that when we get to game time and we're live, it's just second nature.
Nathan Bush: Yeah, love it. Any. It'd be remiss of me not to ask, but any hints on what's coming up in the Advent calendar this year
[Voiceover]: for those who are absolutely not not.
Damian Smith: Oh, close the G secret.
Nathan Bush: Here we are. You can tell us about the new store rebrand names, you can tell us
Damian Smith: about the new physical Stores.
Nathan Bush: But you can't tell us what beer is going in the Advent calendar. What kind of show is this?
[Voiceover]: Just good ones. There you go. That's all you need to know. Good ones.
Damian Smith: What a ro aon.
Nathan Bush: I must say though, I had a lot of fun researching this episode. And the most fun that I had was watching you on the Today show or the morning show trying to tell. Trying to get dogs to drink dog beer on live tv. That looked terrifying.
[Voiceover]: Yeah, look, it was, but it could have been worse. The producer actually suggested that we bring on cats as well as dogs in the same segment. So what you saw there was probably a calm and chilled version of what could have happened. But I assume you would like to know about what possessed me to go on morning television. Selling dog beer would be great. Yeah, Yeah, I asked myself that a lot too. No, it was a fantastic campaign. It was so on brand for booze Bud. I mean, not only do you have bud, you know, right there in the title, but we needed something with a bit of cut through and the right time of year. Really fun segment. Are we going to stop selling alcohol and turn our operations over to being a pet beer supplier? No. Did it get exceptional reach and picked up by multiple media outlets? Yes. So I'll let the cynical listeners figure out where we stand on that one.
Nathan Bush: So is it still in the product range?
[Voiceover]: It may be off by now. It's probably out of date. It's actually based on a bone broth product which has got a six month shelf life. So that was one of my first. I suppose I'd waited quietly in the wings for a couple of months when I joined the team. And that was my first flamboyant leap. And everyone was very, very accommodating when I told them that I needed all this pet beer shipped and stocked and ready to go.
Nathan Bush: So, yeah, you know what you could do? You could do like the revenge case of the Advent calendar for people who have enemies and you know, you send them an Advent calendar. One bottle in there is the pet beer with the broth in it. And you look like you're doing a really good thing, but one day they open it up and it's the most disgusting beer they've ever had in their life.
[Voiceover]: Well, considering that Matt Shervington nearly vomited on live television when he smelled it, yep, that's highly likely. But look, the sanctity and the purity of our Advent calendars will remain.
Nathan Bush: Okay. You know, feel like all my ideas are getting cut down here.
[Voiceover]: Sorry about that, mate. Have some good ones. And then maybe we'll chat. Wow.
Nathan Bush: All right, I'm not getting a job here. So tell me what's coming up next? What do the next 12 months look like? We've kind of got an insight on that. But for you guys, what's the priority? If I was to ask you for the priority for the next 12 months, what is it?
Damian Smith: Number one, next day delivery. So that's close. So we really keen to get that one over line as soon as possible. We've got the boost bud rebranding, the bottle stop. So the whole Shopify switch and all the marketing platforms and all the tentacles that go in all the places, that's coming in about a month to get
Nathan Bush: the domain straight up.
Damian Smith: So yeah, we've yet domain is all sorted. So yeah, happy with that. And then diving into click and collect. So that's going to be a large project. So implementing that with a completely separate POS into Shopify. So all the things that go with that, like gift cards and loyalty and all those things want to be the same experience in store and online. So got a lot of integration work coming up.
Nathan Bush: The stuff that you love, isn't it?
Damian Smith: Oh, yeah,
Nathan Bush: guys, very exciting times and so much there to play with and expand on. Thank you so much for sharing that. It's really made it clear your journey and where you're heading there as a group, which is fantastic.
Nathan Bush: Now, if people want to learn more
Nathan Bush: or get in touch with either of you, what's the best way to do
[Voiceover]: that via LinkedIn for me? Erin Williamson. So pretty, pretty straightforward, shorter hair, but yeah, you'll be able to find me.
Nathan Bush: Good stuff. Yeah.
Damian Smith: LinkedIn for me as well.
Nathan Bush: Lovely. Erin Damian, thank you so much for joining us on Add to Cart.
Damian Smith: Thanks, Bushy.
[Voiceover]: Thanks, Bushy. Have a good one, mate.
Nathan Bush: That was a really fun chat with Erin and Damien. Really impressive. I can imagine that they have seen a a lot of stuff over the last few years as they've been navigating this transformation, especially with private equity and everything that comes with that. But they do have a really clear vision and I love that they've got a clear vision of what they want to do next and how they're going to transform that business. Also really love their personal interactions to be a little fly on the wall in some of those decision making moments. That'd be a lot of fun or. All right, here are the three takeaways from our chat. Number one, simplify for excess. Complexity can be a real barrier to success, especially when you're looking to transform little things become big things in transformation. So by streamlining internal tech stacks and moving towards SaaS platforms that are supported such as Shopify and their connected apps, Paramount Retail are reducing costs, improving operational efficiency and enhancing the customer experience. As the team said, this shift has also led to higher conversion rates and a more efficient business model. So you see there, even from Damien's background as a CTO and a guy who knows his way around tech, it's a really great reminder not to overcomplicate what we have, even though we know we can. 80% of the way on a non customized version of a tech stack is sometimes better than 100% fully customized number two next day delivery Options Now I am biased because Delivery in Person are a sponsor of Add to Cart, but by working closely with the Delivery in Person team, I've been impressed with how easy and how comparable Next Day delivery is for those who have warehousing and customers in the city. If you think next Day delivery is beyond you at the moment, it is worth exploring as it may not be as cost prohibitive or intense on operations as you think. I mean, if it gets past Damien Number three Embrace physical retail in a trend that is actually very common for e commerce brands. Now we are seeing e commerce brands move into physical retail and that's coming largely from a profitability and growth perspective. What I found interesting was that Paramount Retail weren't looking at physical retail from a branding or a marketing opportunity. It was really foot traffic and visitation. Old school retail metrics. That's a very different strategy from most other D2C brands. Expanding into Physical Understanding if you want your physical stores to be a big beautiful brand exercise in the real world or is purely a volume utility game is a great starting point. Thank you for tuning in to today's episode. If you enjoyed this episode, please consider sharing it with a friend or a colleague who may get something out of what was discussed today. Also, leave us a review on Spotify or Apple podcasts if you're feeling generous. And as always, please support our sponsors Shopify and Deliver In Person who make this podcast possible.
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