Nathan Bush: E Suite's 10 Week E Commerce accelerator
Nathan Bush: is now open for enrollment. Our very first accelerator earlier this year
Nathan Bush: was a huge success with 54 graduates who are now putting their skills to use to further their E commerce careers. Over 10 weeks, I personally will take you through the fundamentals of E commerce from strategy to marketing, tech, finance, supply chain and more. We've made this course 100% remote and flexible to fit around your busy life with recorded live classes, an active community, over 20 cheat sheets and more than 600 pages of e commerce content. But the best part is you get to meet and connect with some of the best and brightest up and comers
Nathan Bush: in E commerce in Australia.
Nathan Bush: Enrollments are now open and class kicks off on Tuesday, August 23rd.
Nathan Bush: So whether you want to enroll as
Nathan Bush: an individual or sneaky hint, persuade your boss to enroll. The whole team head on over to esweettalent.
Nathan Bush: To enrol online today. I hope to see you in there.
Dean Salakis: But yeah, it all started 30 years ago. My mum was a clown. We're down 92% so we were just looking at ruin essentially and trying to figure out how we navigated that. Our mission is to help people have parties, not just sell party products and what that might mean for the future. And yeah, there's a lot of fun that can be had there.
[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. Every week Nathan Bush from E Suite and an e commerce industry expert will share the news, research and insights that you need to know to keep you at the top of your game and of course keep your customers Adding to Cart.
Nathan Bush: Hello and welcome to Add to Cart. My name is Nathan Bush, host of Add to Cart and Director at E Commerce talent agency E Suite. Now we don't have guests on too often that are happy to call their mum a clown, but today's guest can because their mum was a clown. Dean Salakis is the CEO and the chief party dude at the Party People Going Online way back in 1999. Dean and his brother are leaders in the party space with a physical store and over 30 team members. Dean is and has been a figurehead in the Australian e commerce industry for so many years. Dean and it was a delight to have him finally join us on Add to Cart. We actually lined up this chat while
Nathan Bush: on the dance floor at the Online
Nathan Bush: Retail Awards who said romance is dead. Now despite knowing Dean for some time, I always pick up something new every time that we talk and in this Conversation. We cover why he thinks marketplaces are the today opportunity for many retailers. We also talk about his approach to acquiring customers via search and how that's changed over the years. We've way back before he started writing a thesis on Google Ads, before Google Ads even launched in Australia. And we go behind the scenes on what really happened when he pitched the Party People on shark tank in 2015.
Nathan Bush: Very revealing.
Nathan Bush: And if you need anything else, Dean gives his tips for the hottest Halloween costumes this year. And thankfully, podcast host isn't one of those costumes. So thanks to our partners Shopify plus and and Paclio. Here's our conversation with Dean Salakis, CEO and chief party dude at the Party People.
Nathan Bush: Dean, thanks for joining us on Add to Cart. You are the chief party person at the Party People and I think we saw that in full force on the Orius dance floor a couple of weeks ago.
Dean Salakis: Yeah, you know, look, it's a hard job. Someone's got to do it. But, you know, I got out there and had a bit of fun.
Nathan Bush: How much fun was that? That was so good to have everyone together.
Dean Salakis: No, it was, it was a good night. It was a good night.
Nathan Bush: And we'll leave it there.
Dean Salakis: We won't say, yeah, leave it at that.
Nathan Bush: Yeah. Now you've been in the business, and I think you have the longest tenure of anyone that I've had on ADD to Cart. You've been in the business since you were 4 years old.
Dean Salakis: Oh, yeah, that's it. That's true. True story.
Nathan Bush: Can you give us the overview? I know it's a long story, but give us the overview of how you came into the party people and who the party people are today.
Dean Salakis: Yeah, good question. So, I mean, the party people wear a party store. We sell balloons, decorations, costumes, all that sort of stuff for a party. But yeah, it all started 30 years ago. My mum was a clown. She was, you know, catering for kids parties.
Nathan Bush: There's not many people that get away with calling their mum a clown.
Dean Salakis: Oh, no. Well, you know what, I used to get teased for it too. So that's interesting. But then she decided she wanted to open up a party shop. And at the time, I think I was three or four years old. And, you know, as a family business, you get pushed into working in the family business. So, you know, they had me there sitting on a little kid's chair, putting sand in bags, which would become the weight for balloons, essentially to hold them down on the table, you know, wrapped them in colored cellophane. It was a bit of an arts and crafts type thing and I got paid 5 cents each time I made one. So yeah, very, very much slave labor. But they, you know, but it taught me a lot and I really actually appreciate it now what was going on there. And yeah, I mean, as I got older, you know, I won't go through my whole career, but you know, certainly as I got older, you know, I got a driver's license, I was do deliveries on weekends. But while I was in high school in 99, my mum had this crazy idea of launching a website when, you know, around just after the dot com boom, you know, bust. And you know, she said, here, you figure it out. You know, I've got. I know some. We spoke to our IT guy who did our computers and all that in store and our POS system said, you know, how do we build a website? And he said, oh, I know some uni students that might be able to help you. They're studying this stuff and at the time you get someone in IT to build your website back then there was
Nathan Bush: nothing off the shelf, right?
Dean Salakis: There was nothing off the shelf. There wasn't even E commerce platforms, there wasn't an E commerce industry, there wasn't anything. It was just you get it to do stuff because it's it, you know, it's coding, it's. It's gotta be it.
Nathan Bush: What was your initial reaction when your mum said, go on, can you make it?
Dean Salakis: Yeah, I thought it'd be pretty fun. You know, I thought this is pretty fun, to be honest. A lot of it was like adding products and because, you know, it was just, it was. We built a content management system. So that was a bit of fun. You know, sitting in with these uni students, I felt pretty important that was helping my mom build this, this website thing and. Yeah, and then, you know, I just had to add products and crop them in, learn how to use CorelDRAW at the time, not Photoshop and crop the images and had this, you know, amazing tool that could make the backgrounds white, all this sort of stuff. So, you know, it was fun times and you know, adding products and you know, we got one order a month or whatever it was and just, you know, it was exciting every time we got an order and go in the store and pick it up. It was definitely a different time to what it is today. Much, much simpler world. Then we take the orders up to the local post office, we drive them up there, drop them in. There was no E parcel back there or anything like that near the local Indian postie by name and had Dinner at his house every weekend. We were supporting his business in the end because we're doing so much volume, so he was loving it, so he gave a little back and looked after us and all that sort of stuff. So, yeah, it was a interesting journey. And then I actually went and got a career at Woolworths, but I'd still work at the party people on weekends, help my parents out and. Yeah, and then, you know, about 2006, I think my parents decided they wanted to sell the business. I was pretty happy with my career at Woollis. I was doing pretty well and, you know, pretty ambitious, if you want to call it, and loving where things were going. So I was happy there. And my brother was in exercise physiology, but, you know, my mum finally got a buyer after a year and my brother just. It took me one afternoon while we were working in there on a Friday afternoon, actually. So I went from Woolies into the shop to help them pick orders at night and that. This was one Friday afternoon. And my brother's like, why don't. Why don't we buy it? Like, this online thing's got some legs and you're a business analyst, you can do that stuff and do all the spreadsheet stuff, because I can't do that. And I'll manage the people because that's what I do best. And we say, yeah, let's give it a go. I don't want to dodge, I guess, the whole thing. And, you know, Gabby talks about it in his book, but, you know, it's one of those things where you just don't want to have regrets. I had that, you know, whole mentality that, look, I just want to give this a go. I don't care if it's the wrong career decision or not. Could be a disaster, but I'd rather do that and make a bad choice than not do it and regret not giving it a go and selling the business to someone else, when I really just felt in my heart that there was a real opportunity here that we could do a lot with. So, yeah, we made that decision. Half hour, quick chat on a Friday afternoon and, yeah, away we went.
Nathan Bush: And you've set that up perfectly in that you've got this career at Woolworths and I've done a little bit of digging and, yeah, you were a superstar. You're on the trajectory of a big corporate career there.
Dean Salakis: Won a few awards there too, actually.
Nathan Bush: Exactly. So what was your biggest hesitation in going back into the family business and to a certain point, leading into the unknown, like putting all your Chips in on E Commerce.
Dean Salakis: I think part of my success at Woolies was the fact that I just love the challenge and love the impossible and love the uncertainty. I mean I got promoted there to a new role that had no team and I created a whole department around it. I love that. I mean I had two promotion options. I had, I could have gone into finance and I'd actually already been offered a role and I'd already accepted it internally. And then I got off of this new role from a new team and I was like, oh, what are we going to do here? And they're like, we don't know yet. I'm like, all right, I love it, let's do it. And you know, that just shows a lot about my personality. I love that. So the fear of going to the business probably wasn't there. I was probably more excited by the challenge where the fear probably was of was. Was failure a little bit in that we were going through gfc. So there was a lot of uncertainty around whether the business would how we deal with that environment. So I actually, I quit Woolies about five times. Actually I quit and they're like, we can keep you. This is what we can do for you. Keep on four days. I'm like all right, I'll stay four days and work in the party people afternoons and night times and make it my side hustle. And you know, then I quit again. I'm like I gotta leave. I've got to get into this business. It's just too hard doing this. And they're like, oh, we can bring you to three days, let's do that. And so I quit a few times and they held on to me and then I got to a point where I'm like no amount of money or contract or anything's going to keep me here. I want to just give this a good red hot go. And finally pulled the plug around 2009.
Nathan Bush: Ever scrolled through an E Commerce packaging website for fun? Nah, me neither. Until today. Paclio is putting the joy into the packaging game.
Nathan Bush: So let's play a game.
Nathan Bush: I'll tell you the name of the Paclio product and you have to try and guess what kind of product they are. Fairy floss Compostable mailer. Queen Bee Honeycomb Padded mailer.
Nathan Bush: Here we go.
Nathan Bush: Gummy shark water activated tape. Now if my jaded self thinks that this packaging is fun, imagine what your customers will think. Paclio is also eco friendly Australian owned and operated with same day dispatch and 14 day returns. Now that's pure joy for everyone. Check out the Paclio range of ecommerce packaging options@paclio.com. that's Paclio P A C K L E O paclio.com.
Nathan Bush: tell us where the party people is at today. For those who may not have, you know, use the party people. Come across yourself.
Dean Salakis: Yeah, so I mean today we've got Australia's largest party store in Des Moines. We've also got the online business and we're doing a bunch of stuff with marketplaces as well. We got about 30 staff depending on time of year. 25 to 35 staff. You know, we're quite big around Halloween. Halloween's pretty big for us and so it's Christmas and we've explored some things around that. You know, we did a pop up story, Melbourne for Halloween, which was just before the pandemic. So the pandemic killed that business model concept which, you know, is a bit of detail about why. But it was difficult to, you know, that kind of business. We need 12 months planning and during the pandemic we just didn't know what was going to come down the line a month ahead, let alone 12 months ahead. So that was not going to keep going. So we've shelved that for now. But again, even this year was too risky. So we'll look at it again next year. Christmas is quite big for us so we do a lot of seasonal stuff around, you know, sports, sporting events, tennis, cricket, football, nrl, all that sort of stuff. So yeah, anything that's the celebration where we love it. We want to, want to see if we can help people make it memorable.
Nathan Bush: What's your biggest seller or category?
Dean Salakis: Oh, you know, I get asked this so much. Balloons are our biggest seller. But you know, I mean it does depend on time of year. We have, you know, Halloween Spiderweb is the best seller during a straight A. The hand, the Australian hand flag waivers, they're the best sellers. It just depends on time of year and what's going on, you know. So what's best seller every day of the week is not what's best for that month.
Nathan Bush: Yeah, really fluid business throughout the year, I could imagine.
Dean Salakis: Yeah. Yeah.
Nathan Bush: And you mentioned the pandemic there. We don't like to kind of labor on it too much but for you I could imagine that would have had a really big impact with parties in lockdown and all that sort of gear. Tell us about that time for you and the big decisions you had to make over the last two or three years to pull your business out the other side in a really healthy position.
Dean Salakis: Yeah, we could talk all day about that, I think. But because, you know, there's been so many stages of pandemic now, you know, if you don't. This 12 months ago, it would have been an easy conversation, but now it's like every stage has been a different journey. But, you know, the first. The first stage was, you know, we got hit by Covid and 92% down straight away, you know, overnight. And that was crushing. You know, we didn't know what the future meant. We were locked down. And, you know, being 92% down is pretty big deal. That was, you know, and that's before the government had confirmed what they were going to do with incentives. It's even hard for us to remember back to then, you know, even though that was only two years ago, it
Nathan Bush: feels like a totally different time, doesn't it? It's not that long ago.
Dean Salakis: We had no guarantee of any kind of bailout as a business from a government, and we were down 92%. So we were just looking at ruin, essentially, and trying to figure out how we navigated that. The first. We did have an interesting ride, and we had a bit of success. We got lucky with it. First we shit ourselves. Then the next thing we did was, I mean, I asked the stupid question. I said, well, what are these 8% of people buying? If we're locked down, you can't even have a party. What are they doing? We were sitting in the room with our manager. They're like, I don't know. I don't know what they're buying, actually. I'm not sure. And so we're like, all right, we'll go find out. So the next day we went. I went into the store, helped serve customers and ask questions of the customers. I mean, there was plenty, plenty of time on our hands. We didn't have any people in the store. So I had everyone asking these questions of the customers and quizzing them on what the hell they were buying. Within a day or two, we figured out people were buying arts crafts, basically, stuff to do in lockdown puzzles, games, stuff that we already arranged, but things that they could do at home. We also, in parallel to all of that, we jump on the sanitizer trend earlier than most. So we're able to get in. We were selling sanitizer. We had stock of it when no one could get it. So we had that as well. So we created this whole coronavirus survival page on our website. So we focused. We pivoted the business into helping people with, you know, survive Covid and have fun and mental health in lockdown.
Nathan Bush: It sounds like a whole new Halloween theme. That does.
Dean Salakis: Yes, that's true. Well, maybe that's what I'll merge it into this year. Well, funny enough, I mean, the last two years we've sold some great costumes for Covid. We've got the syringe, you know, we've got the COVID vaccine costume. You know, they go unrealistic. They're good sellers and I think they'll be good sellers for a while.
Nathan Bush: Now you can have the monkeypox costume as well.
Dean Salakis: Oh, that's going to be the next one. I got to get on that trend early.
Nathan Bush: Yeah, there you go. And what was the hardest decision that you've made over the last couple of years?
Dean Salakis: Look, I guess talking to our staff in that phase, you know, we had to make a decision as a business, do we, you know, when all those retailers were closing their doors, when they maybe shouldn't have, you know, they'll basically just going, landlords, bad luck. We're closing our doors and we're not paying rent. We had to make that decision because from a business point of view, the best choice was to close and stand down all our employees. The best thing from a people point of view would have been to not do that, because they all wanted to. It seemed like they wanted to work. So we were debating whether we go and ask our employees what they want to do, you know, staying open, putting them at risk, or do they want us to close? And we went and spoke to them. In the end, we're a bit worried about that because we're worried what answer we might get. But we thought, you know, it's just the best people decision. And we did that early in the pandemic. So that was the first. The first round. And I think that set the tone for our business, which really helped us to the back end of the pandemic. When we asked our employees what they wanted to do, do you want us to close or stay open? It's your choice. That all but one employee said, we want to stay open because we want, we want to stay employed. We don't want to be stood down. And that set the tone because I think that built a lot of trust with our employees, that they were scared, they were worried, they didn't know if they were going to have a job next week. And, you know, here we have come and ask them what they want. And then we delivered on that. You know, we stood by them. We were sensitive and it just built a lot of trust because every day, as most CEOs knew during that period, you know, we were all watching the 11 o' clock Gladys update, and then we're going back to the employees, and they were saying, well, what does that mean? And we were like, I still don't know. Because nothing's set in stone. It's just guidance. It's not guarantees.
Nathan Bush: And you heard it at the same time as your team did. Like, you're all hearing the same information at the same time. Right.
Dean Salakis: So it was a really tough decision to stay open, and it was really tough to decide to consult with employees because we were fearful that that could have been the wrong economic decision for the business. But we did it anyway and it paid off.
Nathan Bush: Did you have a decision in your head that you wanted the answer to be when you asked your employees, or were you genuinely open to both?
Dean Salakis: Now we're generally open to both. Like, as a business, we decided, like the right economic decision was to, sorry, not to close, but to open sort of restricted hours and to click and collect and stuff. We were worried that they might turn around and say, we'll close the whole business. We don't want to come into work. It's too risky. And we don't want you to fire us if we don't decide not to come into work. So we want you to close it and just make our life easy. That's what we were worried about, the answer being, because, you know, we thought that would be the concern. Like, we want to make the best economic decision for the business, but they're going to want to make the best decision for their health and not take the risk. And I guess what we probably learned is that they wanted to balance it. They didn't want to just close and take no risk. They were like, well, we still want to earn money. We still need to support a family. And yeah, there's risks, but if we're all very careful, which we were, then there may be ways to mitigate most of it.
Nathan Bush: Yeah. And this isn't, how do I say, a large multinational business. Like, your family's income is also on the line here. So you're in the trenches with them, right?
Dean Salakis: Yeah, 100%. I mean, that last lockdown we had. Yeah. That cost us nearly half a million dollars. And that's my money. That's my money. You know, that hurts and it's painful. And you think of how hard you've worked for years to earn that, put that money in the bank, and for it to just be ripped out for something that's out of your control or outside Your control is heartbreaking, but it was what it was. And like, I mean, I always said to people, they're like, oh, you must be hurting. I'm like, look, it could have been worse. I could have been in international travel, could have been better. I could have been in home and home office and stuff like that. You know, you just play the cards you dealt and that's it is what it is.
Nathan Bush: So you've gone through the pandemic, and keep in mind, you've been in e Commerce since 1999. You've gone through the pandemic, come out. I won't even say come out the other side. We're still kind of facing it, still got its challenges. But combining what we saw at online retailer a couple of weeks ago is a really great way to get a pulse check of where the industry's at. What's your take on where E commerce is at and what are you excited about moving forward?
Dean Salakis: Yeah. So look, E comm. I mean, obviously getting back as an industry probably sets a little bit of idea of what's happening in party as well. I mean, we're all so excited to get back and we all had a bit of fun, we let loose. So that's what's happening in party. Generally. People are really pumped about getting back, I think, in E commerce. Look, it's certainly very interesting. I mean, I spoke to a lot of. It's interesting talking pre pandemic. You know, I talk to people and say, did you know, you know, people would say online, you should be doing more online and going harder and stuff. And I'm like, you know, online's only, you know, 11% of all E commerce sales. It's not what you think. And they're like, oh, it must be 50%. You know, the uneducated would say that and you'd be like, no, go look it up. And then they'd look up and they'd be like, really? I didn't realize that. And, you know, the interesting thing we've seen is that the pandemic, you know, people were forced to shop online and so that went through the roof. That number completely changed. I don't know what the real number is at any point in time, but the figures came out something around the high, closer to 20, I think. And we're now seeing it pare back. And you're seeing the announcement from Shopify recently saying we bet the trend would continue. Not flip back to. Basically from what I'm understanding is flipped back to pre pandemic trajectory, which was basically e Commerce growing at about 1% a year in terms of coin total volume from bricks and mortar. So I think now it's sitting around the 40%. I don't want to be quoted on it, but I think it's a few numbers. Yeah, the numbers have been floated around that number and I haven't done a whole lot of research to validate them. But yeah, I mean we're kind of seeing it bounce back to that trajectory. And I think that's interesting because there was this, I mean I wrote a few stories on it, but I think there was this misconception that oh, now there's going to be an acceleration of E commerce because we can have 5G. And I'm like, but if 4G didn't move the doll more than 1%, what's 5 gave a, a reduced impact rather than an acceleration impact. And people are like, oh, but technology will get better and delivery will get better. I'm like, these were all marginal points. And that's what I've seen over time. You know, when I first started in e commerce in 99, you'd make one little change. Like we took over the business and we changed our shipping down to made a flat rate 995 and we saw like triple digit growth and then we did a bit of Google marketing and there was triple digit growth again. And you're getting massive results from small changes now. It's the fake. Over time the changes and the benefits of decisions you made became incremental rather than massive. So now we're always chasing the 1% these days, the 1 extra percentage sales, that 1 extra percent extra in conversion rate. We're chasing small things now rather than going big. And I think that's where E commerce has become super interesting for the more experienced players, is that now we're really trying to find ways to get ahead. And it's funny because back then we thought it was hard and now it's really hard because it's so complex and trying to find what's that next avenue. I mean for us we're finding a lot of growth in marketplaces at the moment. That's a combination of the market changing in how logistics works and that's then fallen in line with our business model and we're accelerating growth there. I think marketplaces at the moment is a huge area of interest for E commerce because I would say five years ago if you asked me where's marketplace going? I would have said, oh, you know, Amazon's going to come and ebay's and then there's going to be JD and Alibaba here, and that's what a marketplace is. And we're going to have to deal with that. But what I didn't anticipate, and we don't all know, predict the future, I wouldn't have anticipated that. You're going to have the barbecues galore's doing marketplace, the you've got lions, everyone's got a marketplace. Now Surf Stitch, all these guys are marketplaces. And it's like, I didn't anticipate that personally. I mean, maybe some people did, but I just didn't think that was where the battleground was going to be today. And I thought it was going to be the Amazons and that that was the area. So, I mean, that's kind of interesting and I think it's a shift in my thinking to go, oh, crap, you know, my trajectory was wrong in terms of where I thought the market was going. It's actually going in that everyone's going to be a marketplace. And what does that mean? You know, we're going to have consolidation because, you know, it's almost like there's two different types of marketplaces. There's the Amazons, ebay's and all that, and then there's just the retailer, which, you know, some of these are going to dilute their branding because, you know, if you're, if you're selling party supplies and we decide to be a marketplace and we're selling all sorts of stuff, from heavy machinery to tractors and all that stuff, do we start diluting our brand? And then what, what does that mean for the long term? Do we end up, everyone is up like an Amazon and then is that the long term future? I don't really know, but it's certainly an area of short to medium term. We're like, how do we capitalize on this shift that maybe retailers didn't anticipate and take advantage for now and then start thinking about the long term, on how we might adapt? Because I think a lot of retailers are here for the marketplace going, oh, but then we're going to go put our products into Amazon and then they're going to figure out that they're good sellers and go direct to the supplier or they're going to go and bring their own brand in? Maybe. But our approach has been, look, why don't we make money to get to that point rather than let someone else make money to get to that point?
Nathan Bush: I love that quote and I think you're absolutely right. There's a big retail, big Box marketplace. And then there's still the specialist kind of. Not niche always, but specialist marketplaces. Do you feel the power for marketplaces is based on expanding the product and the SKU count, or do you feel the value of a marketplace is in being able to incorporate different brands and product options?
Dean Salakis: I mean, I like to think of people like Barbecues Galore and Mosaic brands and these guys doing marketplace as more like an endless aisle approach rather than a marketplace. Even though it's the same concept as a marketplace, the approach from a customer point of view is different. I think these brands definitely have value in adding, for example, Mosaic brands do fashion. But people start venturing into different types of fashion and we sell different items that could be considered fashion. So that gives them almost access to endless, the full breadth of fashion that's available. And I think there's value in that for brands.
Nathan Bush: It triggered a really great example that Angus talk. Angus, the CEO of Barbecues Galore at online retailer.
Dean Salakis: So when we're selling on there, we sold some costumes the other day on Barbecues Galore.
Nathan Bush: Did you.
Dean Salakis: What kind of costumes on Barbecues Galore people? I didn't look properly, but I saw some waters on the desk this morning from of costumes and I'm like, oh, wow, they're buying everything. You know, I can't believe they're going on a barbecue's galore and searching for costumes. But they are.
Nathan Bush: Surely it's the novelty aprons when you're cooking at the barbecue.
Dean Salakis: There's those two. But we're talking like full on costume. I think was a Dalmatian costume or something random like that.
Nathan Bush: That's hilarious because it was. It made a lot of sense when he explained it because he was saying that, you know, with their marketplace there, he's sometimes surprised himself when he logs onto the site and sees what's available. And he goes, yeah, look, if you're having a party or a big barbecue, it makes sense that, hey, you might want a speaker. And we're never going to stock speakers ourselves, but it makes sense for our marketplace for our costumes, whatever it is. But he's like, sometimes it goes way too far. And the, the fine line is how do you make sure that your marketplace is definitely honing in on your specialist area rather than being a catch all of everything and message.
Dean Salakis: Like, I think Harvard Norman is doing that quite well. We're also potentially going to do some stuff there, but they're keeping it very narrow. They're not listing everything, you know, they're not going to list night stuff. On there, you know, so that's fair enough and you know, we respect that. We'll send them what we've got and they can pick and choose. And I believe a lot of these guys are manually reviewing and picking products to go on their platform. So it's not automated and just, yeah, let's list everything. It is curated. And I think there is a lot of value in that for them. You know, Amazon and all that's different. You know, I think they're, they're all, I don't know where the value proposition is. You know, you've, you've got ebay that sells everything, secondhand goods, firsthand, whatever. There's that type of marketplace, there's Amazon, which people value the delivery. So maybe that, that's where people go when they want delivery. There's Alibaba when people want the cheapest they can get and don't care if they get it in three months. So they've all got different value propositions for the customer and I don't exactly know how that will all play out and how they'll fit into a particular niche, but there's definitely value for the customer and they're all differentiating a little bit that provides different value for different types of customers.
Nathan Bush: And do you consider Amazon a competitor or do you just let them do their own thing and stay in your, you know, do your own race?
Dean Salakis: Look, they're a competitor and a potential avenue for sales. I think long run they're a competitor but again, like I said, like I'd rather make money on the way up and then compete with them in the long term. Plus our market is, I'd like to think, and I think everyone probably thinks the same. So I'm sure some people will say you're saying the same thing as everyone, but like I think we're somewhat defendable to marketplace and the reason for that is that on a marketplace if you go and buy a packet of party hat, if you want to buy, if you're having a, a Minions party, which is all the rage at the moment, you're going to go get a Minions party hats and plates and cups and all that sort of stuff. If you're going onto a marketplace to do that, you can, but each of them are going to be shipped individually, they're going to have individual cost for freight in there and built in and you're going to get 10 different packages on 10 different days and all that sort of stuff. If you come to us, you buy it all under one roof. You get one package, one Delivery, it's actually cheaper than buying through marketplaces because even if you found the cheapest of everyone, buying it through us is one delivery cost, it's cheaper, we basket it up, all goes in one box and it gets shipped to you. There's value in that for the customer and customer wants to curate the range rather than hit and miss from a marketplace. There is definitely use cases where our the party people. I think there's always going to be room for specialists, but that's just our business and our business model because people curate like the average basket size is around 20 items, you know, with us where. So that's not something that works well on marketplaces.
Nathan Bush: No, absolutely. So if we talk about discovery of the party people, I read that you wrote a thesis at university really early on around that included how Google AdWords could impact business before Google AdWords was actually launched in Australia. Can you tell us about that and how the role of Google and search has changed for you and the party people over the recent years?
Dean Salakis: Yeah, look, that was a big stroke of luck in a way. I just happened to be doing my final year at university and I had to do a project. There was no real structure to the thing. It was called Business Reports. I had to come up with a whole thing and I thought, oh yeah, I'll do it on the business and review the business opportunity of what is E commerce for the party people. And I did a whole bunch of research and heard about Google doing advertising in the US and they were looking at coming to Australia. And I was also looking at the time there was a thing called Overture, which if people have been around enough, they might know what that is. That was essentially, you know, Yahoo's advertising platform, which was a competitor. And at the time they were saying, you know, you can advertise with us and it's minimum $2 a click and if you don't like it, bad luck. Google was like, nah, open marketplace, bid whatever you want and that's how it'll work when it launches. So we got on board and we were Google's first customer and we were paying one cent a click because there was no one there. So we could pay whatever we want and it didn't matter. And we didn't go down the Overture track. But they changed their tune after a while, realizing the failure in their strategy and trying to overcharge. And then that changed things a bit because we jumped on board with Overture, which was advertising through Yahoo. And then Bing started to become big as an option and I thought, oh, Bing, how Do we get on Bing? And without saying too much and getting anyone into too much trouble, my account manager at Overture was leaving and he was like, oh, you could potentially Geo target because we just had coffees and lunches and stuff like that. And he's like, I wonder if you could geotarget Australia and advertise out of another country for Bing. You know, I was like, oh, that's a brilliant idea, let's try that, you know. So we went and tried that, spoke to bing in the U.S. they said, oh, you know, maybe we could do that. Let's try. Talk to your Singapore office. So we spoke to Singapore and they're like, yeah, we could do that. So yeah, I mean I became, I was advertising on Bing before they even launched in Australia. And again back to arbitraging that one center click.
Nathan Bush: Don't they see my dream days?
Dean Salakis: Oh man, I still thought it was hard back then, you know. Yeah, no, that was good times. And you know, it's a shame you're not still here today but you know,
Nathan Bush: it was paid search still a dominant channel for you?
Dean Salakis: It's still a channel. I'm not sure the exact split between now. I mean at the moment with marketplaces growing for us, it's still a pretty good channel. But you know, marketplaces are a strong growth area. Our website has some good organic traffic as well. And yeah, this is the paid stuff which over time sort of fluctuates depending on what competition's doing as well.
Nathan Bush: Yeah. And if you're writing that thesis today around what kind of emerging technology might have an impact on retail, things that we're not even seeing here in Australia yet, does anything come to mind that you would be keeping an eye on apart from marketplaces?
Dean Salakis: Look, I'd say definitely, probably marketplace and how that evolves is one. But I guess the other thing is probably more around bricks and mortar and what's happening in that space because it's still. I think my view of the E commerce world is the E commerce will continue to grow as a percentage of sales. But I think we're seeing the curve go like this rather than accelerating. I think we're going to get to a point of saturation. I don't know where that is, but
Nathan Bush: I think for those listening, we've got Dean flattening off the curve with his hand.
Dean Salakis: That's not seeing the video. I think we'll see eventually E commerce hit a point of saturation and I think we're not far off that. And then I think that's when people will realize that bricks and mortar is a huge part to play. So I think we're going to see a whole bunch of tech in bricks and mortar land, which is why we see people like afterpay and zip pay and all that trying to push into the bricks and mortar spaces because they realize that's where the money is long term. And I think, you know, going to see technologies like, I mean I'm on the advisory board for disclosure of a scan and go technology, for example. Personally I believe that's the future, particularly for small to medium businesses. There'll be companies will do potentially the Amazon go where you, you walk in and cameras follow you and, and you just pick stuff off the shelf and walk out and it charges your bank account. I think scan and go personally for me is the reason I'm involved in that is because I believe that people will, or small to medium businesses won't have access to that camera technology or not in the foreseeable future will be able to afford it. So then you'll have, you know, these small to mediums jumping on a third party solution like that that provides you with an app and customers can just go onto the app, look up the store, click the store and then you scan and go to checkout and just walk out of the store without having to visit checkout.
Nathan Bush: Makes sense. And does that mean more stores on the cards for the party people?
Dean Salakis: Yeah, we're looking at that at the moment. So there is a few things in the pipeline that we're trying to do. But yeah, can't say too much about that at the moment. The deal's not done until it's done type thing.
Nathan Bush: So I can imagine you can have plenty of fun when thinking and designing what new stores might look like.
Dean Salakis: Yeah, it is fun. It is fun to think about and there's a lot of stuff we've got to think about around strategy as well, around, you know, the fact that our mission is to help people have parties, not just sell party products and, and what that might mean for the future. And yeah, there's a lot of fun that can be had there.
Nathan Bush: Now do you know the story of Mr.
Nathan Bush: Roses?
Nathan Bush: No, it's not the deleted character from Reservoir Dogs. However, they do originate from the 90s. Mr. Roses started in the early days of the Internet Internet back in 1995 and have enjoyed the journey from the early days of managed servers and custom code through to having Shopify plus today. And the change has been incredible. No more downtime on peak days like Valentine's Day. No more guessing what customers want. Technology is no longer the barrier. Good thing we got away from that. Reservoir Dog's tangent. We all know how that ends. To read more of Mr. Rose's story and see other case studies, visit the customer section on shopify.com.
Nathan Bush: I've got one more E commerce nerd question. I've got a couple of others because you've touched on a few things there. But just looking at your site, you've got a really unique menu structure and we talked about how you're very event based throughout the year but you've also got a massive range of product. How do you approach putting all that into an organized way that customers can easily find what they're looking for at the party People?
Dean Salakis: Yeah, look, I mean I came up with that menu structure five years ago. I did a fair bit of research before I came up with that. You know, there's a lot of, a lot of different things you can do with a menu structure. I just felt that trying to be more logical than data driven was a better approach, you know, because like for example, a lot of the competitors will put, especially in the US and stuff where there's a little bit more data that we can leverage. All the competitors are putting say for example balloons as the first or decorations as the first category which is not in a logical structure but it's their best selling category so they're putting it there based on that data. I just found that they could get there anyway without much risk of them dropping off while still maintaining a logical structure which I found was more important than just putting my best categories first. And the split test would show that I sold more decorations because I put it at the beginning. So yeah, I really just approached it from a logical point of view more than a data driven approach essentially.
Nathan Bush: Yeah, that's really interesting to hear that because you look at it and it does look like there's so much science behind it because if anyone hasn't seen, you've obviously got, I wouldn't even call them primary and secondary menus. It's a whole unique design around event based and then category based. But it's really great, so really interesting to hear.
Dean Salakis: It's more trying to help people with their journey ish thing which is actually, you know, these days there is some tech there that we might need to look at, you know, around helping customers say, well it's almost like you're asking the question what are you here for? I'm looking for costumes. I need to wear a costume. Okay, well then there's that menu and Then they go in, okay, well what's the theme? That's the theme. So then it's kind of trying to approach it from that point of view. I guess these days, you know, we're starting to see some good tech where that is done more like a customer service person would. So it's saying to, you know, the customer walks, comes onto the website and then it says, well, what are you here for? And then you tell it and solve
Nathan Bush: the problem first rather than sell the product.
Dean Salakis: Yeah, that's right. So look, I think maybe there is some stuff we might, we might look at with our next rebuild. But yeah, definitely. I like the logical structure.
Nathan Bush: Now you mentioned that you're on the advisory board for the scan and go technology, but you are so well known in the industry for how much you give back and how much you share. You're often speaking at conferences advocating for the industry through the, through the media and on advisories for the conferences and people like Nora, which is fantastic. And I'm assuming that you don't have a whole bunch of spare time sitting around going, what can I do with myself? What do you get out of that involvement and that giving back to the E commerce community?
Dean Salakis: Yeah, look, it's a good question. And again, I could probably talk about this all day. There is a bit of science to it. It is a deliberate thing. And look, it does. Some parts of that don't take up a whole lot of time. Like when I speak, I mean, I don't spend hours preparing. I generally talk as I go on the stage, try to read the crowd. And that's something I've built up as a skill from doing it a lot rather than. And same with writing, it's the same thing. Sometimes I just put pen to paper and write it down and create an article. So I try to hack it, if you want to call it. I try to do it efficiently without spending hours trying to create something or hours trying to prepare for something. But in terms of what I get out, look, I mean, I go to these events and I network and all that. Look, I get heaps from my network. My network adds heaps of value to me, like you said. I mean, I prefer to give more than I get, definitely, but giving is easy. It takes me five seconds to help someone out with something that may add huge value to them and then vice versa. You never know, I might ask them for help. I mean, you know, lately I've been calling on help for M and A activity and stuff like that, asking people, you know, when you did that you know, if I'm going to do a RE platform as another example, you know, speaking to existing retailers and saying, what was your RE platform doc look like? Can you send that to me so I can look at it and compare it to my one and customize it? That value is huge. You know, it takes me so much time to do that stuff. But for them it's a 5 second email as well. So, you know, having a really good network, you can leverage each other's knowledge and that's great. You know, I mean, if I need a social media question, I can call up these fashion guys who are guns at social. You know, that gives me so much value to be able to do that and I value that in my network and I love just meeting new people and you never know where a conversation is going to go. You know, you can have an hour conversation with it and you get no value and that's fine, I'm fine with that. But you could have an hour conversation and you could get a gold nugget out of it that is worth heaps to you. So you never know. Especially like I love talking to startups and sort of scale ups, if you want to call it, or medium size because now these guys are the guys that are hacking and they're finding all the little tricks of the trade and everyone's got something that they're doing really well. But usually someone's really good at a particular area. Whether it's search engine marketing or social or the web design or email marketing or whatever it is, someone's got an area which is firing for them, which is why they are where they are. And I love just discovering that stuff and exploring it with people and taking what I can out of it. That applies to my business and I love it.
Nathan Bush: That's great. And what I love about what you do is you don't just show up. It's not like I'll tick the box on this one, this one, this one, I'll speak here. It's like I'll turn up and I'll speak honestly and openly with a growth mindset to go, how do I help everyone here? And I think that helps you get so much cut through and so much trust that it really does go two way. And I thank you for that because I've got a lot out of what you've shared today, but also in the past. So it's a really great thing.
Dean Salakis: I mean, you asked me before we did this podcast, you said to me, you know, what do you want to get out of it? I know I've got my questions, but what do you want to get out of it? And you know, you heard my answer was just like, look, now this, the whole point of this is to, is for value for the person listening and that's what the focus needs to be. I don't have any personal goals from it. It's more about just giving as much knowledge out there as possible and we'll just approach it that way, you know, and that's what I do with these things. I approach it that way. Look, there's definitely stuff that comes back to me and I love that, you know, getting some value out of it. But I approach it and I take the mindset that it's about giving, not receiving.
Nathan Bush: No, that's fantastic. Now talk about receiving. One of the little tidbits I came across is that you actually received an offer to have the party people bought when you appeared on Shark tank back in 2015. What was that experience like?
Dean Salakis: Yeah, that was pretty crazy. I don't know. Again, like, we don't have all day, but I mean, I went on the show and pitched the business and we were interested in what we might get as an investment. But look, the offer wasn't what I would wanted and to be honest, it was a bit of a tough situation. The way Shark Tank worked then is different to how some of these shows work now. I didn't have. I wasn't allowed to call anyone, get any advice. I wasn't allowed to step out and make a phone call or anything like that. It was like, you need to make a decision on the spot. You also weren't allowed to have, you weren't allowed to have anything with you, like papers, calculators and anything. And they're throwing you like offers like this percentage, this, this that you're like, I don't even, I can't even compute what that really means. And so you're sitting there trying to calculate it while they're sitting there with their pen and paper working stuff out to pitch to you.
Nathan Bush: That seems really unfair.
Dean Salakis: I mean, you know, the whole thing is a pressure cooker situation and that's what it's designed for. But you know, I mean, you know, we got an offer, at least that's better than nothing. It just wasn't the offer we wanted.
Nathan Bush: And when you got home, is your brother still involved in the business?
Dean Salakis: He is, yeah, he is.
Nathan Bush: What was his reaction to you turning down the offer?
Dean Salakis: I'm glad that he agreed with me. It was like, I'm glad you did that because yeah, we didn't want that. And yeah, he agreed with me. And yeah, it was pretty full on. I mean, it was pretty interesting. I mean, that we did that months before it aired and we weren't allowed to talk about it. We saw it all NDAs and stuff. So kind of when it went to air, people, I mean, I was seeing what, what they, you know, I didn't know how they were going to portray it either because, you know, each of these episodes, I mean, I saw a lot of the pictures and stuff and then saw how they turned out. And let's just say it's. It was interesting how they decided they wanted to frame that. I mean, I was in there for two hours, you know, they showed you 15 minutes of it.
Nathan Bush: Were you happy with how you were edited?
Dean Salakis: Look, I think it was pretty much down the line. They picked a few bits out and made me look a bit bad or whatever, but they also picked a few bits out and made it a bit more dramatic and made me look good, you know, I mean, at the end there, they made it all dramatic. Like I turned her down and I shut the door and walked out and they made it all dramatic. Like the music. If you listen to the music and stuff, you're like, wow, we just shut it down and walked out. Good on you. Everyone's like, oh, good on you. You stuck the finger.
Nathan Bush: Total badass.
Dean Salakis: And it wasn't like that at all. Like the deal, you know, it's like, oh, it's not going to work. And then we went up and then said, okay, well, we're all out. And then I went up and had a chat with them and we were chatting and it was just a bit of a. Like I had a chat with all the sharks and all that sort of stuff and they gave me a bit of advice and, you know, just having all this good feel good. It was very positive finish to it. But then what you see on air is like me going, nah, see you later.
Nathan Bush: Yeah, you got to have the drama, right?
Dean Salakis: So, you know, they made me look good there. But, you know, I mean, yeah, I think they made it pretty much about right for me. But, you know, other people got a bit of a raw deal.
Nathan Bush: Yeah. And we mentioned at the start how you started in the party people back at 4 years old earning 5 cents for filling up sand. I saw on your LinkedIn recently that you've now got your kids working in the party people. It's come full circle.
Dean Salakis: It has, it has. And the first job I got her to do was the sandbags. And yeah, she was pretty good. I mean, she's, she's five. She was five when she first started, now she's six. But yeah, that's it. We had her working almost more Covid that was in the way, but we got her working with business. It was just so great. I mean, I, again, I could talk about this a fair bit. It's something I'm actually a little bit more passionate about after doing it with my kid. And then thinking about what I learned from the experience of working in the family business and what values and work ethic it gave me and then seeing what that means for, for her and thinking, well, this is actually pretty good. I want to do more of this for her because I wanted to learn these, you know, these. I wanted to gain this experience. I wanted to get this work ethic. I want this to be normal for her and I wanted to be well adjusted later in life. But then also what it brings to the workplace. I mean, you know, the workers were loving that my kid was there and it brought a bit more of a family feel to the workplace and there was a bunch of unintended consequences that were all upside. And like I kind of mentioned on my LinkedIn post, there was a fair bit of hand holding through that. She's only five years old, so there's certainly not productivity value there. I mean, I paid her 20 bucks as well, but that's pretty good. Yeah, yeah. I didn't get the value out of it that I might have in terms of time and energy from people, including myself. But I think from a day I'd rather do that than putting her up in a vacation care for a day. I think she learns a lot more from that and gets a lot more value out of that. And I think it's really good for her. So, you know, 100% must be so
Nathan Bush: rewarding to get to that point. You've done it yourself and now you're taking care your children through it as well.
Dean Salakis: Yeah, 100%. It's great.
Nathan Bush: Dean, I can't let you go without asking you a question around Halloween. It's obviously coming up and you would be well in the midst of planning for it. What do you think is going to be the hot costume this year for anyone thinking about Halloween?
Dean Salakis: Look, I think Squid Game is going to be huge this year. Again, new episode gets released just beforehand. So I was actually talking with Simon from Culture Kings a little bit about this. We've had a bit of a chat because we've had a few chats over the years. About, you know, stuff like this, that trends and yeah, you were definitely on the same page. I mean I've bagged big on it too. I think it's going to be massive Squid Game again this year. It's going to, you know, the next season is going to come out. It was so big last year and stuff was so hard to come by. So I just think like we're just going to have Squid Game parties this year. That's what I'm feeling. You know.
Nathan Bush: How do you know what's going to be in the like season two? Because you obviously want costumes based on. There'll be some same elements from season one. But how do you get ahead of the curve for what's coming in season two?
Dean Salakis: Oh, it's really hard. You like Stranger Things is another one which is similar, which we've got as a bit of a case study for this too. And again, it's really hard because all the costumes are different, all the characters are different each time and it's really hard. Look, it's hard. It's hard. I can't say there's an easy way out to it. You've got to try to do some research. Sometimes they'll provide previews, sometimes they'll provide guidance. The costume companies that are manufacturers are obviously talking. It's a very well oiled machine in terms of licensing and all that sort of stuff. So there's definitely conversations that get had before the release. Whether they provide that information varies. Sometimes they just don't even show you what's coming. They just say do you want to order the costume or not? And you don't get to see it till you get it. So there's a whole bunch of stuff around, keeping that all tight lipped and all that. But yeah, I mean we just got to guess it's very hard. It's very, very hard. Which is why I was talking to Simon about that and trying to figure out, you know, how do you guys do it? Because this is bloody hard. Like this Squid Game is going to be bigger when the season two comes out. And you know, we started referencing things like money heist and how that went for season one versus season two. Strange things, you know, trying to, trying to reference similar type scenarios and how they played out and then trying to relate that to this is. It's very much an art and less of a science. 100%. No, I love it.
Nathan Bush: That's fascinating. I love that world.
Nathan Bush: All right, so you've mentioned marketplaces, potentially
Nathan Bush: stores doing all the 1 percenters. What's next on your radar, what's front of mind for yourself and the party people?
Dean Salakis: People, yeah. So we've kind of been through Marketplace, I guess, at the moment, continuing to expand that strategy. And we're on six marketplaces at the moment. Two more should come online in the next couple of months, and we could get up to 15 or 20 at some point. And so we're just continuing to push that strategy. Bricks and mortars, another area where we want to open more stores or potentially do acquisitions. So that's kind of an area of interest in terms of trying to. Trying to flesh that out a bit more. I mean, for us, an interesting thing is that bricks and mortar stores are more profitable than online stores. And with a lot of business owners, that can be true for some and not true for others. Every industry is different. In our industry, that's how it works, because we have big baskets, like I mentioned, and they're all low value. So walking around and picking the customer order is expensive compared to the value of the woods. So actually, bricks and mortar is much more profitable.
Nathan Bush: And I can imagine people get really excited in store when they see everything that's available in person.
Dean Salakis: Yeah, it's much easier to do that. And also, you know, you. There's the experience of shopping in store. You know, you're in the party store, there's all these balloons everywhere. It's exciting. You're at the category, all the products in front of you, and you can. You start getting a visual image of how that will all form together. It's hard to get that with online because, you know, the, the picture size of the. The pen and battery is the same size as the backdrop, you know, and it's the exact same size in the. In the tile on your website, where when they're sitting there in person and they see this massive backdrop, they're like, wow, that's epic. That's cool. I need to have that. So, you know, what sells for a particular range online and offline actually does vary. So bestsellers in the category in store is completely different to what's best sellers online. And I think a lot of that's got to do with how people just perception when they see it on screen, they definitely get a better experience in store.
Nathan Bush: Yeah, that's exciting. I can't wait to see the new stores. All right, and we'll leave it here. How can people get in touch? Obviously, you give so much already to the industry, but if people are looking to get in touch, what's the best way?
Dean Salakis: Yeah, look, definitely LinkedIn is the best one. Sort of keep following my story and what's going on there and I post stuff all the time but if I think something's interesting, I'll post it. I find a little hack and all that sort of stuff, so there could be some little value there. But yeah, add me on LinkedIn. Just look up my name. Dean Salakis on LinkedIn. Yeah. The website thepartypeople.com yeah. Anywhere else, I'm all over the place.
Nathan Bush: Perfect. Get your Halloween orders in.
Dean Salakis: Get it in early.
Nathan Bush: Dean, thank you so much for joining us on Add to Card. It's been a long time coming, but so glad to hear your story and the exciting things that you're doing. Really appreciate what you've shared today.
Dean Salakis: No, thanks so much for having me, Nathan. It's been awesome.
Nathan Bush: I told you, I always get something from Dean every time I talk to him. Here are the top three takeaways I took from that conversation with Dean Salakis. Number one, Milk look, the opportunities right in front of you. Dean was really straightforward about this, especially when it came to marketplaces. And you also heard it in his approach for Covid products. You can theorize forever whether something is a threat or a real opportunity. But Dean's view is if it's a growing trend, customers are asking for it, why aren't you a part of it? Don't leave money on the table debating it. You can always, always adjust as you go. Take the opportunities right in front of you. Number two, Embrace the one percenters. We're not in the early days of E commerce anymore. Dean's view is that rather than look for the big transformative projects, online retailers need to be focusing on the 1 percenters that can drive incremental growth over time. If you don't have a plan or a method to uncover and action these 1 percenters, you'll get left behind. And number three, giving back to get ahead. As you heard, Dean is incredibly generous and open with sharing his knowledge and his connections in the industry. As he says, it takes me five seconds to help someone out with something that might add huge value to them. But not only that, it does eventually come back to him tenfold. Dean is a great example of giving with no expectation of receiving or benefiting from from it long term. So think about how you can share your knowledge. Whether that be big things like industry keynotes or smaller day to day things like mentoring up and coming talent. It all makes a difference and no doubt will come back and help you out sometime in the future to get the highlights of today's episode. Head on over to add to cart.com and sign up for our free newsletter each Tuesday. We will send Monday's episode summary links and discount codes for you to go next level on. And if you're looking to explore your next e commerce opportunity, come and Visit us at eSweet. We're a dedicated e commerce talent agency connecting the best e commerce talent with the fastest growing brands in Australia. Head on over to esweettalent.com where you can download the free e Commerce Salary Guide and sign up to our weekly e commerce job emails. Thanks for listening and until next time, keep those customers adding to cartoon.
