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Unprepared Ep 8 - Let's Look At The Data with Jake Cohen from Klaviyo

Timestamps

  • [00:00] - Intro
  • [00:28] - Surveys and data
  • [01:53] - Trends from Klaviyo's data
  • [07:16] - Prediction of future spending 
  • [08:48] - More of Klaviyo’s fresh data

Resources:

Key Points:

  • Klaviyo has surveys going on to figure out what's going on with Ecommerce and customer behavior. There were 5,000 responses so far since COVID hit mid-March. 
  • Data scientists internally look at the Klaviyo's data around the world, which is across 32,000 brands, and tens of millions of buyers.
  • Sales since early March on Ecommerce, at least across the 32,000 customers that Klaviyo sees, has reached up about 30%.
  • Klaviyo is pairing the data with the right strategies to help people make the right choices.
  • Starting March 15, there's a new slope to growth and this is across 19,000 companies around the world. 
  • People have more cash to spend, not because there's more money, but because it can't be spent where it is normally spent. 
  • What's happening with the increase in spending is somewhat similar to Maslow's hierarchy of needs.
  • Klaviyo also has an article about the new essentials amid the pandemic which shows how the change in consumer behavior. 
  • Accessories and apparel have great growth at the start of the year especially in fitness and comfort apparel, not luxury items. 
  • Electronics also has grown because people are buying game consoles, drones, iPads, new monitors, and computers. 
  • According to Klaviyo's survey, people who were recently unemployed increased their spending on electronics since their work things are not available anymore. 
  • Food and beverages and home and garden also have some growth since the pandemic started. 
  • People are also replenishing their health and beauty items or are trying out new items
  • Toys and hobby spending is also up since people are bored at home. In NYC, the spending for this category is up to 130% since before the outbreak. 

Transcript

Chase Clymer  

Welcome to another episode of Unprepared. Today, I got a bunch of information coming straight from the source straight from Klaviyo. Jake, welcome to the show you guys are doing an amazing job. 

I'm not looking at the right camera. It's funny I have a two camera setup. You guys are doing a great job of collecting all this data from not only the people using your platform, but you're actually doing surveys. I'll let you talk about it because you definitely are way more familiar with what's going on over there than I am.

Jake Cohen  

Yeah, thanks, Chase. I wanted to share, so we've...it's been kind of crazy over the past month when this all kind of hit. We tried to figure out what we could do to be valuable for people on our side. I work in the marketing team at Klaviyo and our little mantra internally is value every day. What can we do that's valuable every day? So we're trying to figure out what would be helpful and what we heard from merchants is when everything kind of hit middle March people are like, "What the hell is going on and what is gonna happen?". 

And so we put a ton of energy into trying to figure that out. So as you mentioned, yeah, we have surveys going that over, I think the last count I saw was 5000 responses all in. And then we redeployed some of our data science, data scientists internally to look at all of our data around the world, which is across 32,000 brands, and tens of millions of buyers. And we're publishing that every day so that people can see what the heck's going on.  And then we're, of course, pairing that with strategies so they can figure out what they should do to make the right choices to succeed.

Chase Clymer  

I love that what I can do to add value. That's where this whole little, you know, Unprepared series came from. I was like, Well, I'm stuck at home. Everyone's stuck at home. I'm sure we can just figure out a way to do these webcam calls quickly. 

Jake Cohen  

Totally. 

Chase Clymer  

So enough about me. Let's get into some numbers. 

Jake Cohen  

Yeah. 

Chase Clymer  

Everything hit the fan about mid-March. 

Jake Cohen  

Yeah. 

Chase Clymer  

I'm sure the numbers kind of say that as well. What has kind of happened since then what are the trends that are most surprising?

Jake Cohen  

Yeah. Great question. So overall sales since early March on Ecommerce, at least across the 32,000 customers that we see, are up about 30%. I think we would all kill for 30% growth month over month. So that's crazy. 

And what's been really interesting is this is in the context of the retail report. I don't know if you guys saw it from the census yesterday, they reported that overall consumer spending in the United States was down 8, 9%. 

So you've got normal retail spending down, and then consumers spending on Ecommerce brands way up. Now, obviously, not every ecommerce store is doing great. We're seeing in all categories, some good, some bad. But there are certain categories that are doing way better than others. So actually, can I share my screen? Am I able to do this?

Chase Clymer  

Yeah, let's see if that works.

Jake Cohen  

Let's try. Share screen. Desktop. Can you see this? 

Chase Clymer  

I can see it. 

Jake Cohen  

Alright, sweet. So this is our website. If you want to see this on your own, just click on this green header bar. And it takes us to...this is the page or publishing everything. But one of the things that we added is all this aggregate information. 

So this is what I was talking about where sales are up 30%. We're about to publish the April 15, which just goes like that. But basically, you can see that starting March 15, like wham, there's a new slope to growth and this is across 19,000 companies around the world. 

We also are polishing...this stuff I want to show you. By industry day over day, what are sales happening as compared to last year. And this one's the most startling to me. So this is all apparel and accessories. And what you can see is things are trending pretty sweet and started the year. Right? Things are looking good?

Chase Clymer  

It was starting to get warmer people. Will start thinking about their new wardrobe for the summer. 

Jake Cohen  

Hundred percent.

Chase Clymer  

March 15 is the day.

Jake Cohen  

And, oh, it was scary. You know, we heard reports of brands that are like really good saying our sales just dropped 85% overnight. And you can see it in the data, this year sales were lower than sales last year for these brands. It's the same set of brands. This is the same businesses. But look what's happened since it's been crazy. 

And so yeah, I'm happy to see this. We think that actually most of this growth appears to be in apparel brands that are in fitness or in comfort. Not luxury, not shoes as much. But anyway, it's happening. 

Chase Clymer  

That makes sense. I mean, if you just take an outside perspective on it, people aren't spending money at bars and restaurants as much. They have a lot more income that they can invest in essential products online. 

So, it's not like there's more money out there. It's just it can't be spent where people are normally spending it. Ecommerce is actually kind of winning. 

Jake Cohen  

Exactly. 

Chase Clymer  

What are some of the other ones that are...Well, these are crazy numbers.

Jake Cohen  

Yeah, I mean, look at electronics. (Laughs) We're just talking about buying that stuff.

Chase Clymer  

Yeah, except we can't get the cool cam links or the webcams that we want. That's why we're using our iPhones on tripods above our computers and getting confused on which one to look at.

Jake Cohen  

But this is, people are buying like game consoles, they're buying drones, they're buying iPads, they're buying new monitors, [and] computers. 

We did a survey from our consumer site. It seems that people who are recently unemployed are actually increasing their spending on electronics mostly because their work stuff isn't available anymore. If they're in a white-collar position or service worker and they are now buying stuff to go look for jobs and start side projects and all that kind of stuff. So it's crazy. Food and beverage is no surprise. Home and garden are up because people who are at home and have houses want to get [it] nicer. 

Chase Clymer  

Yeah. I mean, I redid my flower bed probably within the first week that we had the stay at home order here in Ohio.

Jake Cohen  

Right? Yeah, that's right here, like boom! Then my favorite one. So health and beauty. We've heard a ton of people who have like routines. They're replenishing their products, but they're also buying new stuff to try. 

Chase Clymer  

Yeah.

Jake Cohen  

Because they want to feel normal.

Chase Clymer  

Yep, we've got a client in that space, and she's having some record sales.

Jake Cohen  

Yep, sporting goods is up.

Chase Clymer  

That makes sense. You're bored, got to go to the park.

Jake Cohen  

This is my favorite one. So this is toys and hobbies spending is up. And so...which is maybe a little counterintuitive, but people basically are bored at home. And they want to do stuff that's fun. And so they're spending here. 

And in particular, we did this deep dive on New York City. We like to adjust sales in New York City and toys and hobby spending is up 130% since before the outbreak (laughs).

Chase Clymer  

That's insane. I want these people to tell me what their hobbies are because magic cards are expensive.

Jake Cohen  

(Laughs) Right? So it's been wild, you know, office supplies are up. It's been wild to look at this and see everything that's going on. And what we've started to do is we start to predict the future a little bit. I'll show you this cool article I wrote because it's a helpful visual.

Oh, actually, yeah, it's fine. I can show it this way. It's down here. Yeah. You know, the hierarchy of needs. 

Chase Clymer  

I've heard of it. And I would be lying if I said I remembered how it worked. 

Jake Cohen  

All right, sweet. So Abe Maslow is this sociologist and psychologist in the 1950s or somewhere in there, like the mid-1900s. And he had this, that he built this hierarchy of needs. And he was trying to understand, you know what I'm talking about. So what we've sort of predicted two weeks ago, which is kind of coming true, is that Ecommerce spending or consumer spending, I should say it's following this.

Chase Clymer  

Yeah, Jimmy Kimmel made a joke about this in a video I watched this morning. 

Jake Cohen  

Do you really? 

Chase Clymer  

Yeah. They were like week one was food and hand sanitizer. 

Jake Cohen  

Yes.

Chase Clymer  

Even safety and stuff. Yeah, it was hilariously as a joke, it was almost structured around this.

Jake Cohen  

Okay. Can you send that to me? That's awesome. 

Chase Clymer  

I will find it. Yeah.

Jake Cohen  

So yeah, so we published this on April 3 (laughs). All [of] this is coming true.

Chase Clymer  

Here's the thing, once you know that you're safe and this is just the new norm. It's like, alright, how do I get back into just living my life? I'm bored. You know what I mean?

Jake Cohen  

Right, yes. 

Chase Clymer  

So we got about a minute left here before you go. Is there anything else that I haven't asked you that you think is worthwhile and sharing?

Jake Cohen  

I think....for anyone who watches this, we're on updating that page every single day. We're publishing, I think we're at 20 pieces of content a week around fresh data that's coming out predictions of what's coming and then deep dives. 

So if you, if anyone wants, it's literally free. We're trying to get it out so people can make better decisions and understand what's happening. If anybody wants access to it: number one, go to klaviyo.com and click on that green header bar that I showed. Number two, if you have questions or you want us to get into anything, send me an email. I'm jake.cohen@klaviyo.com would love to help and share.

Chase Clymer  

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

Jake Cohen  

Thanks for having me.

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A few weeks ago the world changed forever. Every business, every entrepreneur, every single person was unprepared for the sudden change we'd all experience. I'm going to use this time to create content focused on what you can do right now to help your business grow. We're all in this together, we're all unprepared.