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Customers Crave for Value Through Memberships with Jay Myers - Honest Ecommerce Ep. 144

Jay Myers is the co-founder of Bold Commerce, one of the fastest growing tech companies in Canada. 

Powering over 100,000 brands, Bold has become a leading e-commerce technology provider to many of the largest brands in the world. 

Bold has grown from a basement to over 400 employees, inspired by an unwavering commitment to customer care and energized by a culture of continuous innovation. 

Bold has been ranked one of Canada's Top Medium Sized Employers, ranked in the top 50 fastest growing companies in Canada by Deloitte multiple years, a 2019 Top Growing Company in Canada by the Globe and Mail, and an Ernst and Young Entrepreneur of the Year winner.

In This Conversation We Discuss: 

  • [00:00] Intro
  • [00:57] History of Bold Commerce 
  • [04:37] From D2C to making apps
  • [07:30] The growing Shopify app market
  • [09:20] Shopify apps and Online Store 2.0
  • [10:17] The zero-sum mentality fallacy
  • [11:45] The Shopify community is unique
  • [13:28] Bold’s evolution as a company
  • [15:33] Saying yes to too many things
  • [16:38] Bold’s previous partner misalignment
  • [18:58] Making money vs growing company value
  • [21:37] How to monetize your novel idea
  • [23:31] Sponsor: Electric Eye electriceye.io
  • [23:51] Sponsor: Mesa apps.shopify.com/mesa
  • [24:36] Sponsor: Rewind rewind.io/honest
  • [26:03] Sponsor: Gorgias gorgias.grsm.io/honest
  • [26:35] Sponsor: Klaviyo klaviyo.com/honest
  • [27:22] Subscription app and working with Shopify
  • [29:17] Drilling down to what the clients really want
  • [30:20] The Bold Subscriptions Pro
  • [32:53] Order value vs churn
  • [34:39] Do you have to upgrade?
  • [37:15] The consolidated checkout advantage
  • [38:05] Shop Pay vs Shopify Payments
  • [39:41] The problems with Shopify Checkout
  • [41:32] Shopping outside the front-end
  • [42:10] The great thing about Amazon Prime
  • [42:53] Where the loading times matter
  • [44:15] The value of Shopify and it’s long-term goal
  • [45:23] Making it easy for merchants
  • [46:22] The value in memberships
  • [49:12] Where to find Jay and Bold

Resources:

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 Transcript:

Jay Myers  

If anyone is thinking like and wants to get ahead of the game for the next two to three years, think about how membership can play into your strategy.

Chase Clymer  

Welcome to Honest Ecommerce, a podcast dedicated to cutting through the BS and finding actionable advice for online store owners. I'm your host, Chase Clymer. And I believe running a direct-to-consumer brand does not have to be complicated or a guessing game. 

On this podcast, we interview founders and experts who are putting in the work and creating real results. 

I also share my own insights from running our top Shopify consultancy, Electric Eye. We cut the fluff in favor of facts to help you grow your Ecommerce business.

Let's get on with the show.

Hey everybody, welcome back to another episode of Honest Ecommerce. Today, I'm welcoming to the show a guest I've been trying to get a hold of for a while. We finally got him on. 

Jay, from Bold Commerce. How are you doing today?

Jay Myers  

I'm doing awesome, man. Thanks so much for having me. I didn't realize I was hard to track down. Sorry about that. (laughs)

Chase Clymer  

You just been a busy guy. Let's talk about how busy you are. You have probably one of the larger companies outside of Shopify in this Ecommerce direct-to-consumer atmosphere. 

So just give us a big, quick snapshot of what Bold Commerce does and what they're bringing to the market.

Jay Myers  

Sure. Yeah. Yeah. It's crazy. We're getting close... I think we're at 450 people now. So we're getting close to the 500 mark. It's been a crazy journey. So it started... And we launched as well... I'll go back to a real short bit of history. 

But I'm an Ecommerce store owner and I have been since 1998. I grew up in a family business. I sold bows and arrows, actually. 

I was really big into archery. I was the Canadian champion for a couple years. And so then in 1998, me and my dad, we had a little pro shop and we started selling them online. And then I sold on various platforms.

I did the eBay thing for years. They did every Ecommerce platform at the time. 2010, [we] heard about Shopify, moved one of the stores on as a test. It went really well. 

And Shopify at the time was ahead of the game when it came to themes and out-of-the-box stores looking really good. And they had this concept of an app store, which today, everyone, that's a normal thing. 

But back then it wasn't. No, they were the first Ecommerce platform that had an app store. It was still [very early at the time]. It was very much integrations into things. 

So for example, an app that would integrate into UPS or into accounting software there. It was all back-end API’s

But we came at it wet with thinking like a merchant like "How can we use this app store?" The apps... 

The first app we launched was an upsell app, which of course lives on the front-end of a store, you click add to cart and a pop-up comes up and says "You're buying a leather jacket. Do you want the leather treatment kit?" 

And it actually wasn't the way that Shopify originally intended the API's to be used. They were more for integrations. 

We were doing functionality on the front of the store. So in the early days, Shopify wasn't completely happy with the reason we were doing that. And it actually took down the entire platform. We would have stores run a sale. 

And I remember in the early days, it was The Chive, they would run a promotion and hundreds of 1000s of people would hit their site. 

Everyone's clicking and the pop-ups are coming up. And every time that happens, there's an API call that hits Shopify and says, "Hey, what product... Give me back a product and I put that in the offer." But there was no API throttling or limiting so it actually took down the ecosystem. 

So at the time it was 20,000 stores not 1.7 million that is today. So Shopify wasn't crazy about it at first, but then of course merchants loved it. 

So Shopify figured out "Okay, we've got to solve for this." And they put in API limits and ways that it could be used. And then today when you go through the app store, it's all front-end apps. 

All the apps add... Well not all of them but a lot of them add some front-end functionality. Yeah, so we kept growing. We just kept building more apps.

I think we actually got to a point where we had 36 and the app store but we've we've pruned quite a bit. I think today we're at 17 or 18. We just sunset 3 of them. 

We've gone through an evolution over the years of trying to do a lot to become a lot more focused at what we really want, what we care about solving, and being really good at it. 

So today we're... Yeah we're around 450 people spread out across North America. We started... I'm in Canada. We're about 250 up here and then the rest are all around the US and Canada.

Chase Clymer  

Absolutely. I have a bunch of questions for you. Going back to starting in... Launching an app into the App Store. 

Were you passionate about the tech side, the nerdy side of Ecommerce? How did you have this idea to build a business in Ecommerce outside of doing the direct-to- consumer selling stuff online?

Jay Myers  

It's funny you asked that. I was not passionate about the tech or nerdy side at all. And I was very.... So I just saw.... Still to this day, I consider myself... I have a [mercantile] mind. 

In my free time, I have family members that have Shopify stores and I help all of them with it. I just helped one of them run an email promotion last night and get their Black Friday stuff ready. 

And like I love that like that's like, at the core of... I could just... Because I've done it all my life, I just love commerce. 

And so I actually... That's the mind.... I am. But there's 3 other partners. 2 of them are developers and one of them was a designer. And we all just happen to be really good friends. 

So I had like zero passion about technology or anything, I just wanted solutions that made more money because we were still running the stores. 

We actually... we ended up selling them in like 2016 but we kept them for years and eventually got to a point where "Okay, we just need to focus just on Bold." We had these stores and the stores were profitable. 

They were doing great but you don't die from a lack of good ideas. There's always too many things you can do. It's the indigestion of good ideas. And so anyways, we got rid of the stores in 2016 and just focused on building the apps. 

But it's funny because I remember so many developers and communities, "People saying anybody has a good idea for an app? Or does anybody have a good idea?" 

And I remember having this list of probably 100 ideas of things I wanted to do, but it was just not enough time and not enough people. 

And so yeah, I think it's important that the technology is amazing on Shopify. But sometimes you gotta take a step back. That's the nuts and bolts to an end. 

And you want to build something that adds value for merchants. And of course, the tech is very important because that affects the speed and affects how it integrates with things and affects its robustness and scalability and everything else. 

But that should always be secondary to the value that it's adding. And so anyways, I was able to just not think about that at all. 

Our 2 partners who are developers focused on that. And I was able to just have my mind on what's the best. How is this going to make a store more money? So I really like the 4-week partnership. It was actually amazing to get that in the early days.

Chase Clymer   

Yeah. You still see Reddit threads and people asking in Facebook groups. They're like, "Oh what's a problem that needs to be solved? Give me an app idea." 

Everybody still wants to get in it because honestly, there's still money to be made in the app ecosystem within Shopify. 

There are still awesome ideas out there to be conceptualized and built out and sold on the App Store.

Obviously, you guys have been an app store that kind of since the beginning. But there's so many things that you can still do. 

Jay Myers  

When we launched our first app, I think there were around 40 apps. 40 or 50 in the App Store. Today, there's over 7000 something. I don't know exactly. It's definitely changed. 

Every day, we have a few areas that we focus on and it just seems like every week, there's another one in there and a lot of them are free or it's hard to tell what is supported and what's not. 

And it's definitely become a crowded space. But I will say that the cream always rises to the top. 

If you're building a product that adds value for merchants, you care about it, you care about supporting it, you're passionate about the space or the problem you're trying to solve. 

And even if it's something that someone suggests to you and maybe you don't have a lot of history, you research it and you become... You'll do well. I agree. There's a lot of... 

Ecommerce in general is still only... I don't know what it is. 19% roughly of total retail. So it's not just the potential in Shopify. It's the potential [of] the entire market. More and more people.... 

And the pandemic, of course, accelerated that. But I'm very bullish on Ecommerce enablers. So an app company would be an Ecommerce enabler.

Chase Clymer  

Oh absolutely. And what I've noticed recently is the new... I don't want to say flavor of the week cuz that sounds like they're bad or anything like that. 

But like the new hotness or whatever, it usually comes out within weeks of a new API release. Now I have 2 examples off the top of my head. 

When they first released the Checkout API a year and a half ago or something, I watched this guy Gil Greenberg, he worked in public and launched that Checkout Promotions app.

And it was for the Shopify App Challenge. And then he quit his job and now that's all he's doing. And it was a really awesome journey to watch on Twitter

So that came out right on the tail end of that Checkout API thing. And now Anne Thomas just launched Design Packs on the... What was that? 

The Online Store 2.0 and Sections Everywhere launch. So if there's developers out there that are thinking and looking for ideas. There's something that you should do.

Jay Myers  

100%. And even within a certain space, whatever it is, there's different ways to solve it. And I can tell you, subscriptions are very big for us. 

We have Upsell, we have different tools, there's always going to be multiple versions of it. It's like apps on the iPhone. 

Apple makes a very good calendar, they make a very good To-Do app, they make a very good Maps app, but you probably don't use all of the Apple products. And then if you use a different one, other people might... 

Depending how you use it, and what you're using it for, there's gonna be room for solving it in a different way of finding a niche within it. And especially when we're approaching 2 million people on the platform, the pie is getting bigger. 

And the mindset of there's only so much pie and if I take a bigger piece, someone else gets less... That's the zero-sum mentality. And it really isn't that because the whole space is growing. 

So me and you can have an app that essentially does the same thing and both thrive and be essentially friends. It doesn't have to be like that. Now that could all change when markets mature. lt definitely is.But right now, it's not like that.

Chase Clymer

Well, you touched on 2 things there that I really want to highlight. The first one being is I don't think I've ever been in a community that's like the Shopify partner app ecosystem. 

There is such camaraderie and you want everyone to win. It's everyone has this "Rising tide raises all ships mentality." Referrals galore. 

And it's such a fun place to be in. I know that through experience on the agency side. and I've kind of heard similar things on the app side. Yeah.

Jay Myers  

It's true. Shopify is always... I have to give credit to them. They've always done a great job of positioning themself against the incumbent. In the early days, it was... I remember when it was Bigcommerce... 

Now Bigcommerce probably isn't much like crosshair anymore but it's still something. It's still, I'm sure, a consideration. But then it was Magento. And then it was... Now it's Amazon arming the rebels. 

And they've always been able to really build a rally cry. And the Partner Community is on board and we're empowering the small merchants and... That's kudos to Shopify for... They say the best brands tell great stories. 

And I'm not saying it's a story. I'm saying they're doing a good job of actually relaying what they're doing. Whether they're doing it or not, if you don't tell that story, it's hard to get behind. 

And I think that's been a big part. But you're right though, we're in various other communities and Shopify is unique for sure in that sense.

Chase Clymer

Yeah. I think that's what drew us as an agency to this ecosystem. And we just stopped working with anything else. And also just a tidbit there. 

Just focus on one technology and you just become so much better at it and your prospects become so much better because you're a specialist as opposed to a generalist. 

You're gonna... You got a... You got a leaky roof, you're gonna hire a roofer, not a general contractor. Same concept applies to a service business.

Speaking of that, we touched on this in the pre-show. So Bold wasn't always just an app company. And I think that's an interesting little tidbit. 

We can touch on there to talk about how the brand evolved over time. 

Jay Myers  

In the very beginning, we were just an app company. We launched... Our first one was Upsell, then it was the Discount Engine. Then it was an app for creating sophisticated options on products

Then it was customer pricing, which does wholesale VIP pricing/member pricing. Then it was like a store locator app

Anyways, every time someone would use one, they often wanted customization and the Partner Community now is great. 

And even no matter how much you want to pay or how little if you want a task with a Storetasker or HeyCarson and you need a small thing versus if you want to hire an agency in New York for a year long project. 

You can find agencies. That wasn't always the case. And so we went down... We formed this department that was basically.... We called it our Professional Services Department. 

It was helping brands, customize and build out. And of course I expanded into... We did full builds. We did everything. That team got up to about 50 or 60 people. What ended up happening in the end... I think [there are] 2 reasons.

So that team doesn't... All this stuff is still at Bold but the service doesn't really exist anymore. And I think for 2 main reasons, one is focus. You nailed it. 

Very few companies die --I just touched on this earlier-- from lack of opportunities and lack of... They try to... It's not because they say... It's because they say yes to too many things, not because they have to say no. 

And so we were getting a little bit unfocused. And it was affecting our product roadmap and what we wanted to build. Because it's easy when someone comes and says, "Hey, I want to pay you $100,000 to build this thing." 

And then maybe we didn't have the resources. So we would pull a couple developers off of some product, put it on, and then that would make that money, which helps short term but it doesn't [help the] future builds or [the] products that was  the long term goal of our company. 

And we kept finding ourselves in this dilemma.  [We're like] "Okay, what should we do? Money now? Or build [an] IP, (Intellectual Property) that's ours that we can grow?" 

And then the other big thing is it became a bit of a misalignment between us and partners. And we were always... And to this day we are very, very clear. 

And never once did this ever happen that if a partner would recommend someone to us for one of our apps --For example, a our subscription app-- if a partner would recommend, "Hey, you should use Bold for subscriptions." 

Never would we try to do professional services work for that partner. That was a line in the sand we just did not cross. But it's hard. 

I can understand and we have a number of partners that we're like, really good friends with and they said like, "Hey, I got to tell you. It's like, we compete with you on the professional services side.” 

“We want to recommend our brands to you to use your apps, but we're a little worried. Are you going to try to like, take them on the professional services site?" 

And of course, we said "No, we absolutely would not." But I could 100% understand the dilemma there. And so basically at right at that point, we said "Nope, We're shutting down our professional services part we want." Our goal is to enable partners. 

We want to be the most partner-first app company there is. That is one of our OKRs for the year and so. And that's why we've been so focused on building our apps all API first and headless

And we have a team focused on developer docs. And so the partners can take it and build anything they want on top of it. But we definitely didn't want that concern that if there might ever be something that like a client might move to Bold. That would never happen. 

And so anyways, that department, we shut down. We only do products now. The only services we do is just on a product. So if you are using one of our apps and there's some custom functionality, it wouldn't really make sense for a third party agency to build it. 

If it's something in the app, we do have a strong team that can do that but nothing like... We would never do a site build or something like that. But yeah, that was a hard journey. And I know a lot of people probably go through that. 

And when someone's willing to pay and give you money, it's very hard to say no. I'll tell you what works for us as we got to a point where... I actually remember the conversation. 

We were sitting together one day, the 4 of us, and I said like, "Hey, why don't we? Why don't we mow people's grass for money?" And the others said like, "Jay, that's like a stupid thing to say what do you mean? Of course. We're not a lawn mowing company." 

And I said, "Well, but yeah... But what if they were willing to pay us $300 an hour and we only have to pay developers like $50 an hour and we're making money. What if it made ridiculous money? Why don't we mow grass?" 

And the answer is, well, like when we thought about it. We were like, "Yeah, why don't we mow grass if it's super profitable? Why don't we?" But the reason we decided in the end was that it doesn't build the value of our company. 

So there's things you can do that make money that don't grow the value of the company and there's things you can do that maybe don't make money but they grow the value of your company. 

So we started to shift to decisions that if it was... Does this grow the value of our company? Making money was secondary. Because we knew if we grew... 

And the only way that we would grow value in the company is by building products that made more value for merchants. And so that was the line for us. 

Agency work is great and we work with tons of amazing agency partners. It was just [not] for us, it wasn't our long term goal. So we had to trim it. 

So we, as of today, yeah, we don't do any agency work anymore. And so we send a ton of work to partners.

Chase Clymer

Absolutely. And I think we've got some referrals over the years. So thanks for that. 

Jay Myers  

I'll try to send more. 

Chase Clymer  

Thanks! (laughs) So there's one thing I just remembered from what you're talking about.  The app ecosystem. And you touched on it. 

But I really want to highlight it here, which was the concept that there are many apps that do the same thing. And I think that's something that someone may turn off younger entrepreneurs. 

"Oh, there's already someone doing that. There's no way I can do that." That's a bad mindset. 

And what I want to tell you right now is, if there's someone already doing it, all that tells you is that there is a market for that solution. And you should double down on that idea.

Jay Myers  

Yeah. Totally. I think someone else in the space is a reason that you might be successful at it. I couldn't agree more. I would actually be concerned if you were doing something that nobody else is doing. 

Chase Clymer  

Mm-hmm.

Jay Myers  

If that was the case...

Chase Clymer  

Maybe it's a red herring or something. You might be wasting your time. 

Jay Myers  

Yeah. And if that is the case, if you do have an idea that no one's really doing yet. Reach out to merchants and get 10 on board to be your first 10 customers and ask them to pay. 

Don't just say, "Hey, I'm gonna give you this for free, because I want you to help test it." Pitch them the idea. And if they're not willing to pay, they probably don't actually value the idea. They're just doing you a favor.

 The hardest thing in the early days of any entrepreneur is lip service from friends and family. And they're doing it out of a good place. They have good hearts. 

But they'll say things like, "Oh, that's great. Yeah. Oh yeah. Everyone will buy that." But until someone actually takes out their credit card and is willing to pay for it, that's the only vote that matters. 

So try to... And if you don't have the ability to... You can go in communities and forums or you can reach out to partners. 

If someone reached out to me and said, "Hey Jay, I'm thinking about building SAP. I'm looking for like 5 or 10 people. Can you think of anyone?" 

I could probably think of like a 100. And if I reached out to some merchants, they would probably be happy. 

And if it was a product that solves for inventory, or solves for tracking, affiliate marketing, or something else, I might know. And people are always willing to help. 

If it helps a merchant and there's no conflict of interest, then it's a Win-Win. But yeah, that's definitely... We've launched products, for sure, that there were no competitors. 

And we didn't really do a lot of market research. We just thought, "Oh, this is probably a cool idea." We think 1 or 2 merchants asked for it. 

So we thought, "Oh, that's a signal that everyone should want this." And that's why we at one point had 36 apps and today we have 18. We've cut a lot.

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Chase Clymer  

Let's pivot a bit now. And we were talking about how we've seen some success with new apps coming into the space on the tail end of new API releases. 

And you guys just completely redid one of your apps on the tailend or actually probably during the API release. I know you guys got an inside scoop in Shopify. So let's talk about the new Bold Subscription app.

Jay Myers  

Yeah. Well, we were... Yeah, we were involved in the build process. So we worked with them actually helping out like testing the API's before they were released. 

That was the second or third attempt. Shopify tried a few different ways [and] revamped the whole thing. So long story short last November, Shopify introduced API's that allow essentially subscriptions to flow through their checkout. 

So it was good timing for us. Because we, for the past two years, had been working on another version of our app that we were calling... 

We were, at the time, calling it Bold Subscriptions Pro. We had our normal Bold Subscriptions app. If you went to the store, we used to be called "Recurring Orders, Bold Subscriptions." 

But essentially, it was an app that we tried to build every feature into our version one. We thought it had every feature you could imagine. You want to do convertible subscriptions or subscriptions automatically swap products or try before you buy or buy something large... 

Dynamic discounts you could program in, build a box functionality, buy buttons, email upsells... 

We built everything in and it was very powerful. But what it wasn't was it wasn't super flexible. It was pretty rigid. 

We didn't think of how we... We went up... When there was a problem or a feature, we tried to solve it in the app. 

And that's very common. When merchants are saying things like, "Hey, this is missing this feature. It's missing this feature." 

And as a product developer, your mindset is if someone says... You know there's a saying and I love it. It's like there's a screw... If you're selling a screw... A screwdriver, let's just say. 

You might think it's all about the screwdriver. But what the customer actually wants is they want a screw in the wall. They don't actually care if it's a screwdriver or what gets it in. 

We just think it's a screwdriver, but what they really want is a screw on a wall. And then actually is it even about the screw in the wall or is it about the shelf they want to put there? 

And then if you go one step further, is it the shelf that even matters [or] is it they want a place to hang their books or to set their books? 

So when you take a step back and what we've tried to do over the years is get really to the problem. Not just the lipstick in the front to solve it. But what's really the problem, they want to... 

We understand, "Okay, they really just want a place to hang their books. We can forget about everything else and look at that." And it makes you think differently about how you solve it. 

And so with version 2 --Well, it was Bold Subscriptions Pro. It's not called version 2-- we wanted brands to be able to do anything with their subscriptions. We wanted to build all the core functionality in.

So you can have a subscription program up and running in 60 seconds. Literally that fast. Probably even faster. 

Pick a couple products, click "I want to add a 10% discount apply, and you have subscriptions on your store. That's like the basics out of the box. Everything works. 

But if you wanted to build out like a very sophisticated subscription flow, where it's part of a wizard --like a signup wizard-- or maybe you want to extend it somewhere. 

Maybe you want to have subscription functionality like in SMS or in Alexa, or by voice or by email. We have a lot of brands that do this. 

And it works really well instead of... I don't know. If you subscribe to something, do you ever forget your login, or you probably have got something for a couple more months because you're like, "I keep forgetting to log in to change it." 

But if an email came to you every month and said, "Hey, your subscriptions are going out in 3 days. if everything's good, no action needed. Or here's 3 buttons, Snooze for a week, Skip this month, or Pause." 

And then you could just do it right from the email. 

And there's an API call that updates a subscription or that can be by SMS or that can be "Hey Alexa, when's my next coffee subscription coming." 

"One week." 

"Okay, snooze in a week." 

We thought this subscription experience doesn't have to live just on the front end of your store. But also if you do want it on the front-end of your store, you want to customize it any way you want. We also saw the customer portal as a huge opportunity. 

And we're seeing a couple brands now really take advantage of this. And so our customer portal... By customer portal, I mean, where you can manage subscriptions, pause that, skip, cancel.... All that. 

But an interesting stat is over 90% of people who make a subscription log into their customer portal at least once. 

So you've got this piece of real estate on your website and you're growth marketing... If you want a tip for growth marketing and if your subscription brand is merchandise, that page, put in exclusive offers in there or upsells, or cross sells, only for subscribers that they can go in there and with one click add to their next upcoming subscription. 

You don't... They don't have to re-enter their credit card or anything like that again. So I won't go down a rabbit trail on that. But that's a huge opportunity. 

We saw Brian just a week ago, redid their customer portal, put in some offers in there --that were member only offers-- They sent they have tens of thousands of subscribers. But they did a test. 

They sent an email to just over 3000 and just under 1500 accepted the offer. So their exact conversion was 44%. So 44% of existing subscribers accepted the offer to add it to next month's subscription. 

And when they say like, it's 25 times cheaper to market to an existing customer than to acquire a new one, it's true. It really is true. 

And I bet you 90% of brands that have a subscription, once they get that customer subscribed, that's all they care about. 

And then they just care about churn. They're like “How do I reduce churn?” But you really should be thinking “How do I increase the value of that customer?” Sell more to them, make them more satisfied... 

Anyways, but Version 2, yeah, we launched that. So it goes through Shopify Checkout and currently works with Shopify Payments, Authorize.net, and Paypal Express

We just launched that as well too. And it's going really well. It's made a lot of things more seamless. So like if you use upsell after checkout apps, for example --like Zipify and Carthook and those things-- they just work out of the box.

Chase Clymer  

Mm-hmm. 

Jay Myers  

A lot of the analytics things, Klaviyo, different tools... Because it's going through Shopify, it just works a lot more seamlessly. And so it's been great.

Chase Clymer  

Yeah. You're touching on something I wanted to bring up. What is the difference? 

What was happening before that made the original way that subscriptions work in anything that was manipulated the checkout work versus now? 

What is the advantage to me as a merchant? Why should I upgrade if I've already done this before? 

Jay Myers  

Okay, that's a really good question. And our  message that we're telling all of our brands is you don't necessarily need to upgrade and Shopify isn't forcing anyone to upgrade. 

Currently, it doesn't actually... It's a very good solution going through Shopify Checkout, it actually doesn't work for everyone yet. 

So there's a lot of payment gateways that still aren't supported; Different currencies, different parts of the world, and certain functionality too. But I'll say Shopify is very transparent.

There's a page on their developer docs where they've actually... They don't do this for a lot of areas. 

But they've posted the roadmap for what's coming for functionality, what payment gateways are being added. 

Shopify doesn't typically post a roadmap ahead of time because things change, but they've done that for this one small area. 

So we actually have a... If someone's using version one, we have this questionnaire they go through where they check a bunch of boxes like "Are you using this feature? Are you doing this? Are you doing this?" 

And if you're just using it basic and you haven't done a ton of customization to version one, you can just upgrade. It's seamless. We actually have a tool that auto upgrades you. 

You don't lose any subscriber data. Subscribers don't need to re-enter credit cards. Their subscription will ship 1 month with the previous version. 

And then the next month with the new version, a customer would actually wouldn't even know that you upgraded in the backend. But I definitely wouldn't say you should be... 

If a brand right now listening is using the previous version --and there's a lot of people that are-- I wouldn't run around and be like "Oh, I need to upgrade. I need to upgrade." Talk to... 

You can talk to us. You can reach out to support and say you're thinking about it. And we can send you this questionnaire that helps. Think "Does it make sense?" "Does it not make sense?” And maybe it does or maybe it doesn't. 

But as great as it is, Shopify is still very actively working on a lot of functionality. So you might be doing something that isn't supported yet. 

But it might be in a month or might be in 2 months. And we can help tell brands "Okay, this is a month away." "This is 6 months away or not." "You're good to go today." But I wouldn't do it without checking first. 

Chase Clymer

Yeah. 

Jay Myers  

And that's happened and it's not easy to go back. So.. 

Chase Clymer  

Absolutely.

Jay Myers  

Just reach out. And we can help. Yeah. 

Chase Clymer  

All right. So I've done this questionnaire, I'm good to go. But what is the advantage to me as a merchant? It's not broken, I don't need to fix it. 

That's what I've already heard here. What's the advantage to moving to the consolidated checkout?

Jay Myers  

The main thing is it's 1 checkout to manage. So you're going through Shopify Checkout, there are a number of other apps that just work out of the box. 

So if there's other functionality that... If you're doing things with thank you emails, maybe you've customized, maybe you're using something like a Spently or Receiptful or like you're using an upsell after checkout app, or you're using some analytics... 

Actually, the analytics ones, there's still not quite fully... There's still some work to be done there. But a lot of the apps do work a lot more seamlessly. 

Chase Clymer  

Yeah. 

Jay Myers  

There's still some work to be done. But generally, there actually isn't a choice... If you go to the app store right now and install any subscription app, it's gonna go through Shopify Checkout. 

They've said that no more apps can have their own checkout for subscriptions. And then Shopify Checkout for one-time orders. 

So eventually, everyone will be on Shopify Checkout. Yeah, you leverage all the advantages that Shopify Checkout has. They don't support Shop Pay, though. I think that was one big misconception. 

So it supports Shopify Payments. And what that means is Shopify Payments is a gateway. Shop Pay is a payment method. 

So Shop Pay it's merchant... It's customer facing. Shopify Payments is merchant facing. 

So if I use Shopify payments, I create my Shopify store, I use Shopify payments. 

And that means I can accept Visa, MasterCard, American Express, whatever. 

Now if a customer checks out of my store, they don't see Shopify payments anywhere they just see my credit card so the customer still has to enter their credit card. 

They don't get that one-click Shop Pay experience. That's not available yet for subscriptions. 

And that's been a bit of a... I think a lot of people get confused in general about the difference between Shopify payments and Shop Pay. 

So they think it's one and the same and they want to switch... 

Chase Clymer  

Yeah, they did a really good job at naming those. (laughs)

Jay Myers  

Yeah. (laughs) Well, now it's... I think we've done a pretty good job getting people clear on it. But that was one thing that caused a lot of confusion.

Chase Clymer  

Yeah. I think we danced around it. I just want to really call it out here right now. So historically with apps in the app store for Shopify that was manipulating the checkout via either subscriptions or post-purchase upsells... 

The old method, it would clone the checkout experience. Some people wouldn't even notice that they had a different checkout, unless it was really caught up by the brand or they're actually reading what's going on with installing the app. 

So basically, it'd be the whole front-end experience of Shopify all the way to the cart. Once you hit checkout, instead of going to the Shopify Checkout, it would now go to a cloned checkout that was powered by Bold or whatever app. 

So that creates some oddities that we saw from an agency side. Holy crap. 

That was always like a really interesting endeavor. Also, mixed carts would sometimes just cause a giant pain... And it was just annoying. So that was always something that we saw. 

Gift cards were another thing that were confusing at times. So there's just a lot of extra stuff that you wouldn't consider causing an issue by using a secondary checkout. But now that's not an option anymore. 

And everything's going into the one checkout and because Shopify realized that like, "Hey, these are the issues. And the easiest solution is just let us plug our stuff in here."

Jay Myers  

Yeah. And you're right on all of those points. Discounts were challenged. We had a solution for it. It was actually another app you installed called the Discount Connector and it would sync discounts so you could create discounts in Shopify. 

And then it would work in the subscription checkout. But you could also... There was discount management in the subscription checkout so you could create coupon codes that only worked for subscriptions. But it created more work to set it all up and sync everything. 

Chase Clymer  

Yeah.

Jay Myers  

Yeah. No, you're... Absolutely. And Shopify... I mean, a trend that's happening right now in commerce is... 

Of course, where the shopping experience happens probably won't always be the storefront. And it already isn't. 

We're shopping on social media. We're shopping on video, we're shopping in apps, we're shopping on voice... We're shopping all over. 

I think we'll probably be shopping on Netflix or in... I think Amazon Prime said they're testing, making shows shoppable so you can shop what people are wearing and what products are in a scene. 

Chase Clymer  

There's... You know what I really like about Amazon Prime... This is... Well, first of all, the app itself is garbage. But when you're actually watching the show and you pause the show, it tells you what you see. 

Jay Myers  

Yeah. 

Chase Clymer  

That is amazing.

Jay Myers  

Yeah. I have an 8-year old daughter and it's like my favorite thing because like if we pause Harry Potter or something, and you're like, "Whoa. That's what that guy actually looks like?.." 

Chase Clymer  

Yeah.

Jay Myers  

"...It's like nothing like the guy in the show." But yeah, so with... Shopify used to be that their value was they were an Ecommerce platform that you could easily build a store. 

But less and less people are caring about the store. 

And even a lot of large, large brands on Shopify, don't actually use Shopify as CMS. They're using some type of other front end. 

They're using Contentful. They're using like... Shogun’s got a great front-end. We've seen a lot of brands going to their... I know if you've played around with that, but it's... They've got Shogun Page Builder but it's also Shogun Frontend

Chase Clymer  

Mm-hmm.

Jay Myers  

It's a Progressive Web App. It's lightning fast. And when you're... And the reason why that matters is just a small tangent.

But if you're coming... If you're on Instagram and when someone says like "Oh, how does 3 seconds make a big difference?" Like if I want a product, I'm gonna wait 3 seconds. And that's true if you're searching for it on Google. 

If I'm searching for, I don't know, snowboard boots or something and I searched for it on Google... I'm going out. I'm spearfishing. I'm looking for that product. I'm hunting. I'm gonna find... I'm gonna wait for a page to load. 

But if I'm scrolling on Instagram, and my thumb is moving a mile a minute, and I see an ad for something. And if I click that ad, and if the page doesn't come up as fast as the next post, I'm X. I'm on. Because it's like this mindless thing. 

And so that's where these lightning fast front-ends help out. We're seeing social brands come from social, their conversion [would] be like over 30% by moving to like a lightning fast front-end. 

And so long story short, the value... When you think... When you're a company, you have to think "What is our value to the customer?" 

And Shopify's value used to be that it was the store. But as less and less transactions initiate there, they've started to place more value on their checkout and see that as a key piece of their long-term strategy. 

And so their goal, of course... Or their hope is that you can kind of shop anywhere, but you're still having to use their checkout because let's face it. 

Shopify is... They're almost as much a payments company as they are an Ecommerce company. 

I think actually, when you listen to their earnings calls, their payments revenue is equal or --Don't quote me on this-- But it's equal or more. It's a lot. It's substantial. So that has to be core to their strategy. 

And so all aside --like what you said earlier--is probably true. You can make arguments that it may or may not be true. 

But for Shopify strategy, they need people going through their checkout. It isn't like the world was complaining about these other checkouts. There were some issues. There were some rough things, but it's core to where Shopify needs to be in 5 years. 

Chase Clymer  

Mm-hmm.

Jay Myers  

Which I think... I'll say, I think it's a good thing. And I'm not saying that this with any type of like, "Oh, they did this because its launch strategy." 

I think it generally makes things better for merchants. It's a great experience.

Chase Clymer   

It makes things way more seamless. And it's like, merchants want to sell their product. They're products to people. They have their creative. 

They don't want the technical stuff that comes along with computers just being computers, which, to anyone that doesn't work with them all day long, they are so dumb. They only do exactly what you tell them.

And me as a merchant, that should just work. Logically, in my mind, "That should [just] work. Why do I need this integrator to make this thing?" You know what I mean? All of that extra work is frustrating. 

So just trying to make things seamless and easy, it makes sense. Jay, I've had a fantastic conversation. Is there anything that I forgot to ask you about that you want to share with our listeners?

Jay Myers  

No, I'll just have this. On the topic of subscriptions, this version 2 right now, we're giving away free for 60 days. So like if anyone is thinking about starting subscriptions. Gartner Research put out a study --I think it was about a year ago-- that by 2023, 75% of DTC brands will have a subscription membership offering

We're seeing brands in every vertical have some type of it. It's not just that like okay I sell coffee or I sell deodorant. It really [could] mean that you can sell clothing, you can sell anything and have a layer in membership.

And you know, I always tell people subscription is a transaction decision. Membership is really what your customers crave. And a subscription app is a way to monetize membership. And membership can be access to exclusive content, access to you. You're the founder. 

If you have... I'm a member of. One of our clients is Foreign Affair Winery... They use our app but I'm also a member. And I get an email once a month with my new wine that comes... I can do a virtual wine tasting with the Head Sommelier. 

He opens it, shows it what it pairs with, how it was made. That's the value that members crave. Things like that. 

So I would just say if anyone is thinking like and wants to get ahead of the game for the next 2 to 3 years, think about how membership can play into your strategy. Customers want to be a member. 

And if you can package that up and monetize it, your chances of success are way better. And not just that. Your value as a company. 

We're seeing some of our brands get investment at 8x to 10x their annual recurring revenue that they do through our app. So if you sell... 

Jonathan Kennedy is, he's a good friend. And he's got... He has a marketplace for selling websites. 

And if you look at what a typical value valuation of a store selling one-time products, it's like 30% to 40% EBITDA

So like its earnings after interest, dividends, taxes, appreciation, all the expenses, what's left, and it's a percentage of that. 

But brands that are doing recurring revenue, they're getting like 8x to 10x top line. 

So a brand doing a million dollars in subscription is potentially worth $8 million to $10 million brand, doing a million dollars in one time is potentially worth $300,000 to $400,000. 

So it can drastically change the long term value of the company. So we're big proponents of it. And that's why we've really doubled down. 

So I would just say, if anyone wants to get started, we'd love to help. And we have it free for 60 days for anyone to try. 

And [it would] be awesome to work with some of the people listening.

Chase Clymer  

Yeah. What's the URL that I go to if I'm interested in this?

Jay Myers  

Yeah. Just Boldcommerce.com. And it's right up at the top. Just click on subscriptions. That's the easiest way.

Chase Clymer  

Awesome. Jay, thank you so much for coming on today.

Jay Myers  

My pleasure, man. Thanks for having me.

Chase Clymer  

Alright. I can't thank our guests enough for coming on the show and sharing their knowledge and journey with us. 

We've got a lot to think about and potentially add into our own business. You can find all the links in the show notes. 

Make sure you head over to honestecommerce.co to check out all the other amazing content that we have. 

Make sure you subscribe, leave a review. And obviously if you're thinking about growing your business, check out our agency at electriceye.io. Until next time.