Main Takeaways:

  • Phillip and Brian are joined today by research guru, Rachel Swanson, founder of Method + Mode which gives bespoke insights for brand growth.
  • First, Brain and Phillip give a COVID-19 update.
  • The trio review Rachel’s work on Future Commerce’s Vision 2020 Report and reflect on the process of the research and give their own insights to the findings.
  • Rachel makes data come alive and creates a story from the data she gathers.
  • The three discuss the cyclical nature of retail and how DTC brands are evolving and how they think brands will continue to evolve in the future.
  • And they throw in a few hot takes, just for the fun of it.

COVID-19 Update from Future Commerce

  • We were off message with our episode last week when we published our episode talking about Ingrid speaking at Shoptalk 2020 which then got canceled.
  • Brian lives in the Seattle area. There are no gatherings of more than 250 people allowed, even with religious gatherings.
  • Businesses in the Seattle areas are struggling with the lack of interaction.
  • An interesting statistic, a lot of DTC toilet paper companies are having a very high amount of traffic on their sites. Who Gives a Crap, Bippy, and No. 2 are all out of stock.
  • There’s an interesting development in how technology can aid in this environment.
  • We’ve seen a big step up in corporate responsibility in response to the virus.
  • We’re no longer a manufacturing-driven economy, we’re a services-driven economy and the service industry’s suffering will impact the entire global economy.
  • Storefronts selling services JUST overtook storefronts selling goods, which makes the impact of COVID-19 even more unfortunate.

What is Method + Mode?

  • Rachel is a market researcher & brand strategist, focusing on leveraging custom research to inform business executives and decisions.
  • Rachel has a heavy background in media, fashion, and beauty.
  • Method + Mode creates a custom research plan to help their clients get the research they need.
  • Bespoke insights for brand growth.

Making the Data Come Alive

  • Originally, Future Commerce worked with Method + Mode to do some audience research
  • Most recently, Rachel worked with Future Commerce on our Vision 2020 Report.
  • Rachel doesn’t do academic research.
  • She works with existing hypotheses, business objectives, and consumer reality. The key is to triangulate the three into succinct research that services the objectives of the business.
  • Rachel’s approach is to lay a foundation towards the hypotheses and then to validate or disprove those hypotheses.
  • Asking non-binary questions in a way that requires a response is a great way to get a sense of broader themes.
  • More people have a better understanding of why they won’t do something, rather than why the will do something, so Rachel often asks why people won’t do something in creating her surveys.
  • Writing a good survey is a skill that requires a lot of practice.

Gaining Insights from your Data

  • In your surveys, you always want to throw in some issues that will help disprove some of your biases.
  • Rachel includes multiple ways of exploring important objectives to create consistency in answers.
  • When understanding benchmarks, the Vision 2020 report wanted to go as broad as possible.

Hot Takes on Amazon

  • Amazon is not a retailer anymore, it’s a utility.
  • We’ve crossed into a threshold where the consumer isn’t fully cognizant of where they’re receiving their content from.
  • Phillip calls this “Primenesia”
  • This Amazon utility is enabling a lifestyle that is impossible to match by other retailers and content providers at the same level.
  • Apple is attempting to step into the content space now.
  • Rachel compares Amazon’s structure and function to almost being like a Verizon now.
  • Brian’s gut instinct was to check a knife set he found at Macy’s on Amazon. He bought the set from Amazon, even though it was the same price. Why? He knew what to expect, and could easily purchase it from Amazon.
  • Back to content, Amazon makes it so simple to stream content through the prime video app. At this point, they’re controlling the content.
  • On the Vision 2020 report, the number 3 cited reason for having Amazon Prime was for video content.
  • In 20 months, Prime added 35% to Prime Membership by going global with Prime.
  • Sustainability is coming to the forefront of consumer consciousness, and there might be a growing distaste for how Amazon operates.
  • Brian thinks that although Amazon is the Verizon of the world, there’s going to be a T-Mobile.
  • Brian would rather pick Amazon than Target, but someday, he might pick say, a Walmart.

Enough About Amazon… The Broader eCommerce Landscape

  • Retail is cyclical. We’re starting to see a swing back to brick & mortar shops.
  • Rachel thinks DTC as a mechanism is great branding, but there’s always been DTC.
  • Example, the Sears catalog.
  • Social media has helped DTC brands tremendously.
  • Globalization has helped the ability for DTC, fueled by social to grow
  • Showfields is basically a department store.
  • Could Barney’s have saved themselves if they had been more futuristic and partnered with emerging brands on social?
  • DTC is giving female founders a good opportunity. If you equate DTC with a local shop, a lot of them are actually owned by women. For example, florists, beauty shops, gift shops, boutiques, etc. Women do the majority of purchasing, therefore have more of the purchasing power.
  • There’s a connection and tactile component of retail that people said would go away but it never has, it’s just morphed.
  • Is DTC a misnomer? DTC is a way of starting but it’s doubtful the successful brands will stay purely digital forever.

How Accurate Was Our Survey?

  • Phillip asks Rachel if we were off the mark compared to Retail Dive’s research that says 40% of consumers have shopped DTC, whereas ours only said 30%.
  • Rachel responds that she was encouraged by their reportings. She doesn’t know their methodology, but their methods and definitions and sampling could be different than ours.
  • Ultimately, we were on target with another national poll that Rachel compared our insights to.
  • Phillip reiterates that we’re #MoreThanAPodcast.
  • We want to be more open and transparent about how we make predictions and give insights.

Hot Takes Lightning Round

  • Rachel: Sustainability is such a “catch-all” phrase. It sounds great in theory but there’s too many forms of sustainability. We need a clarification of what that actually means for the brand.
  • There’s still a big chasm between those who are thrifting for need and those who are thrifting for presentation.
  • Brian: Sustainability is not convenient.
  • Nordstrom is creating credibility by creating a resale market, called See You Tomorrow.

Find Rachel at Methodandmode.co

Brands Mentioned in this Episode:

As always: We want to hear what our listeners think! What are your thoughts on the shift towards profitability for direct to consumer brands?

Let us know in the content section on Futurecommerce.fm, or reach out to us on Twitter, Facebook, Instagram, or Linkedin.

Have any questions or comments about the show? You can reach out to us at hello@futurecommerce.fm or any of our social channels; we love hearing from our listeners!

Brian: [00:00:00] Hello and welcome to Future Commerce, the podcast about cutting edge and next generation commerce. I'm Brian.

Phillip: [00:00:05] And I'm Phillip. And we have back with us Rachel Swanson from Method + Mode to talk about all kinds of fun things today, but in particular, we're going to dive into research methodology and maybe how it ties into our Vision 2020 report that came out earlier this month at NRF. Welcome back to the show, Rachel.

Rachel: [00:00:24] Thanks, guys. I'm glad to be here.

Brian: [00:00:26] We're glad to have you.

Phillip: [00:00:28] As of right now, I can't give exact numbers because I'm not that prepared, but you had one of the top five episodes of 2019. It still gets lots of play.

Rachel: [00:00:39] Stop it.

Phillip: [00:00:40] I'm serious. It's the truth.

Rachel: [00:00:44] That's great.

Phillip: [00:00:45] It's the truth.

Rachel: [00:00:45] I love it.

Phillip: [00:00:45] Maybe a good prep to this would be to remind people who you are and what you do and maybe touch a little bit on what Method + Mode is.

Brian: [00:00:55] Yes, please.

Phillip: [00:00:55] But I do encourage anybody, if you have a little time after this, go check out that prior episode because it's a good one.

Rachel: [00:01:03] Sure, well, thanks, Phillip. Thanks, Brian. I'm a researcher. I am a career market researcher and brand strategist. I really focus on leveraging custom research of all types to inform business owners and executives on next steps and really on business decision making. So while I have tons of consumer research and product strategy, you know, new product development in my background, really my focus as an independent sole practitioner has been and really just helping businesses shift the needle. So guys like yourself. My background is heavily media/fashion/beauty. So I still work with the media space a fair amount, which is an industry that's, of course, changing tremendously every day. And I do survey research, focus groups, usability testing, et cetera, really creating a custom plan to help people get the data they need, so they can tell the story they want to tell. I like to call it bespoke insights for brand growth.

Phillip: [00:02:13] Wow. That's great. And somehow we've somehow slipped you some sort of drug to make you do that with us from time to time. Are you OK? This feels like it's against your will. I'm just saying. {laughter} We are honored to work with you because you have some pedigree in this area, and you've done this on such a huge scale in the world for great brands.

Brian: [00:02:41] And you're super good at it.

Phillip: [00:02:43] And you're really good at it.

Rachel: [00:02:46] Thank you.

Phillip: [00:02:46] If we were to talk about the story we were trying to tell with the Vision report, which is like our first public market research report... We certainly have done some research in the past together. And I think that we started out trying to figure out what our audience is looking for. And we use the outcome of our own internal research that we partnered with Method + Mode on. Again, that was I think the topic of our last podcast was specifically who are our listeners, what are they looking for, and what drives value for them? And we were able to double our audience size and engagement last year using the insights from that. And so like pushing that out to a broader world of research and consumer sentiment and specifically how we might use consumer sentiment to guide business decisions in retail. That was the point of the Vision report, and it was our first one that we made broadly available. And so I thought maybe we could spend today talking about the methodology and how you do what you do to make it useful.

Rachel: [00:03:49] Sure.

Brian: [00:03:49] Make the data come alive. Become the voice of the people who were surveyed and tell their stories and provide the insight. Then we take and then turn around and turn it to something else. How do you make sure that this is both usable, consistent, and accurately reflects what you've discovered?

Rachel: [00:04:10] Yeah. So I'll kind of go backwards from that. So the accuracy is just in the sheer fact that I hold the work I do to a high standard from a rigor perspective in terms of how we sample, how I craft a survey, the methodologies that I use, when I use advanced data processing statistics, et cetera. So making sure that that's as rigorous and up to code, for lack of a better word, as it should be. That said, I don't do academic research. This is what I specialize in, whether it's for consumers, whether it's for a large established media, whether it's for audience development, is that there are existing hypotheses at play and there are business objectives that need to be met. And there's consumer reality. So how can we triangulate to get accurate truth or near truth from the people we need to speak to that also services the objectives. You know, no one wants to invest in research for the sake of research. And while it's lovely when you've done that, and you can find nuggets, and you have an end user who is excited that they gave you carte blanche, and you have great data, and you found a story... I have found in nearly two decades of doing this that that is a very tough sell. And that is a very hard thing to rely on. So my approach is really about laying that solid foundation towards the hypotheses that are in play, but also almost kind of doing, you know, validating and disproving, putting opposites into the survey instrument or into the discussion guide or on the one on one interview. That's kind of my approach in general to what I bring to the table from a customer research perspective. And there're a couple ways that I practically do that to make sure that it not only feels right for my client, like you guys, but also so it feels right for the survey taker or for the participant in the study. And so one of the things I try to do is make sure I'm as colloquial as possible and limiting jargon. I make up my own scales sometimes. You know, it's not just like "agree strongly" or "disagree strongly." You know, I try to make up my own scales that make sense for the question we're trying to ask. And we can dive into these more. But I'll just kind of give the high level. I like to be provocative. I think asking non-binary questions in a way that makes people have to respond is not only a way to get a data point that you might need, but to kind of illuminate a broader theme. So something we did that kind of speaks to this is in this study that we did that fed into the Vision 2020 was these kind of tradeoff questions.

Brian: [00:07:15] Yeah.

Rachel: [00:07:15] And one very simple one was, you know, would you rather work out or take a nap? Obviously, those are not the scope of possible things one could do with free time. But forcing someone to choose one gives you a sense as to their overall mindset and what their kind of predispositions are, which can help feed into how you're looking at the data on the back end. So it's making a little bit of an inference on top of getting the data. So that's what I mean when I say be provocative. And the third really more tactical thing, I make sure I do, again I'm working primarily in this capacity with small businesses, with startups or with executives who kind of need that third party to fly in and help, is limit open ends because there are so many ways to get unstructured data nowadays. But open ends in a survey form, at least in surveys, not in when you're doing one on one qualitative, but in survey form, it's like getting a Yelp review. You either get good stuff from a positive experience that happened, or if you ask something explicit, you should ask why they won't do something. Because consumers are really bad at telling you what they will do, but if someone knows they're not going to do something, they usually have a more concrete handle on why. So those are kind of like three things I make sure to bring to the table. And in just how I structure when I do survey research and three things I wanted to make sure to hit on in this report, knowing that the end result was thought leadership and that Future Commerce and Gladly we're partnering on this with some hypotheses in mind. And we were able to prove or validate or disprove some, but really wanting to have the data drive the ultimate predictions. And I think when you treat the users in a way that makes sense to them, and when you ask things in a way that engenders them to want to respond, you get better data. You know, it is also pretty short. We kept it pretty short.

Phillip: [00:09:25] Yeah.

Brian: [00:09:25] Totally.

Rachel: [00:09:26] I know those seem very basic, but it takes... You know, survey writing is like making a really great deck. Sometimes a 10 page deck is the one that takes you three months to do because you have to get every slide right. So I think like writing questions that hit on those points and with an eye towards how you're going to use the data is just where my mind runs.

Brian: [00:09:55] Nice. I think that you nailed something there. This is not easy. This is a skill.

Phillip: [00:09:59] It is a skill.

Brian: [00:09:59] This is something that you have to work at. It's a discipline. And it takes practice. Hence why we're so happy to know you, Rachel, because this is something that Phillip and I, you know, we're developing as a skill as well with you. And I think the survey that you wrote... I think another thing that's really amazing that as a result of writing a really good survey, is it makes it a lot easier to clean insights afterwards. Right? And so talk to us a little bit about that process and how you were able to come up with some of the insights that you gave us as a result of the survey.

Rachel: [00:10:44] Yeah, I mean, it's a little bit of reverse engineering, but like I said, you almost want to throw some pills in there to kind of disprove your biases that you're bringing to the table. So I always make sure to do that because you never want to just like be in your own bubble completely. And that's obviously would not be something that people found authentic or reliable. So it's a fine line. But I think in terms of making it easy to find the insights, it's thinking ahead to even small things like if you want to be able to look at the data in a certain way, if you have an idea that geography matters, let's just pick something out of a hat, that geography matters in what you're looking to do. Make sure you're asking that. But even from a more granular perspective, the psychographics. If there is a mindset that you really feel strongly about, functions in a different way from others, including a little battery of psychographics or some combined behavioral segmentation as the survey questions to make a survey driven segmentation. I mean, that's really where I keep my eye. Because you're never going to find a ton of nuance in straight demographics slicing and dicing. I also like to make sure that I link survey questions together throughout the instrument and come back to things. So it's easier when you're in a qualitative focus group or one on one interview to jot a note and come back and say, "Well, tell me more about that." But I like to often include, you know, two or three different ways on really important objectives of asking the same thing so that you can figure out if there's consistency or find where you have the needle in the haystack of something that resonated a little more or made a little bit of a difference in your phrasing. And I think we did that here. I know there were there were a number of topics we wanted to include. But from a methodology perspective, it didn't make sense to to ask necessarily all of them. And obviously, I know a lot of your listeners have already read the Vision 2020 report. If they haven't, they can go to the site and get it.

Phillip: [00:13:06] You're good at this. You're hired. {laughter}

Rachel: [00:13:10] {laughter} But yeah, I mean, there's a lot of stuff. But also, the Future Commerce position as experts in the industry speaking to everyone in the industry all the time from all different angles, some things did not require consumer validation. So we wanted to make sure to just focus on that. And a lot of what we focused on was the Amazon behavior, the sustainability, you know, things that are about the behaviors and attitudes that people are doing right now. Awareness of direct to consumer, things like that. So that's where we really focused in order to be able to craft the ultimate predictions and trends that we're seeing.

Phillip: [00:13:52] Let me ask this, because I think you said it in a way there that I hadn't really thought about before. Is it a very common practice to take ten different, very disparate ideas and survey them all in one go to a broad audience? Because I think that's a little interesting in that we were trying to find ways to suss out ten distinct things, I think eleven, depending on how you count it. Ten distinct trends that we were trying to follow. And they're very broad. Some of them relate together, which is, you know, some sustainability topic vs... Some of them you can clump together. But how do you link monoculture and grand millennials and crafting and then people who make content on YouTube and TikTok? Was that a particular challenge or do you think that I'm sort of overthinking it? I'm asking, are we special snowflakes? I'm trying to figure...

Rachel: [00:14:57] You know, I think when you're in a thought leadership and content creation space, that would be more of my recommendation is to go broader with who you're speaking to, so that you can see if there is a smaller target where things really pop. And also when you're looking to kind of set benchmarks and understand penetration, you want to go as broad as you can. So I think for what we've partnered on together, that makes a lot of sense. If we had gone directly to... Let's say if we had only gone to 18-35 year olds, and we're just looking at kind of the Gen Z, young Millennial segment, you know, you would still have great insight, but you wouldn't know if that differs from any other kind of demographic or psychographic. So it would be harder to say that it was a more universal trend. And I think we were going for the universality of some of these ideas that had been purposed.

Brian: [00:16:04] Right. Speaking of these trends, I would love to hear some of your hot takes on some of these trends. We've had some interesting little back and forth about this. And so I think our listeners would be interested in some of your hot takes. Maybe talk to us about Amazon for a second and some of the data you saw there.

Rachel: [00:16:24] Sure. Right. Well, I mean, you guys speak to Amazon a lot in your episodes. And I would never want to say I am an expert by any means. So take all my hot takes as the outsider at the table. But what was really interesting to me to see when you have the data in black and white is just the idea that Amazon is not a retailer, it's a utility. And I think we've crossed that threshold where people don't even think about the behavior that they're, you know, how they're interacting with Amazon that much anymore. And you don't think you're... You're not buying from Amazon. You're not even watching Amazon shows. I mean, I'm sure we've all had the experience where we're streaming something, we've no idea where we were streaming it from. We had to go back and think or like look at our log of what we were watching where.

Phillip: [00:17:10] Yeah. Different kind of Primenesia. Right?

Rachel: [00:17:13] Yeah. Primenesia. I love that.

Brian: [00:17:14] {laughter}

Phillip: [00:17:14] Yeah.

Rachel: [00:17:15] So, yeah, it's a utility. It's totally a utility. And it's enabling a lifestyle for people, whether that's stuff service, content, all three, only one of the above. So it's interesting to see this continue to evolve and think about how brands continue, obviously, to want to compete with Amazon or kind of achieve similar success when it's really not as possible. I mean, you can almost go the reverse and say, you know, Apple's trying to do more content now. They sell a few things. But, you know, it's not in the same space. I mean, to me, I feel like a more... In the coming months and years, what I think are more adept analogy to what Amazon is doing now, at least under the current structure of how it functions, is like a Verizon.

Phillip: [00:18:24] Wow.

Brian: [00:18:24] Yeah, I think you're right about that. I wonder how this is going to play out, like how we're gonna get there. Because I was recently shopping online, as I'm prone to do at times, and I was looking for a new knife set for our kitchen. And I saw a great price on some knives at Macy's. And I was like, "That's a really good deal. I wonder how much they cost on Amazon." That was my gut instinct.

Rachel: [00:18:51] Right.

Brian: [00:18:51] My gut instinct was I'm going to check this on Amazon. It turns out it was the same cost. And guess where I bought those knives? Amazon.

Phillip: [00:19:00] Right. Because you know exactly what to expect.

Brian: [00:19:04] Because I don't want to deal with Macy's. I know exactly what to expect. I already have the app on my phone. I know how it's going to feel when I get the product. Two day shipping.

Phillip: [00:19:10] It's the default.

Brian: [00:19:10] It's default. It is. Exactly what we've talked about. It's closer to a Verizon.

Rachel: [00:19:14] Right. Which is also a default. It's like how often do you change your cell phone provider?

Phillip: [00:19:20] Yeah.

Rachel: [00:19:21] You don't unless you have to. Like it's almost like that's where it's at. I'll give you another example, too, from the content perspective. I have a young daughter. We watch a lot of PBS shows, and Amazon Prime has a lot of interesting shows that they have developed on their own for kids. They have some of the other, like, books that have turned into shows. But you can access the majority of PBS content through Amazon, through Prime. So even though I have a connected TV, and I can pull up the PBS app and watch stream through there, I don't even have to. So I don't.

Brian: [00:19:59] Yes. Totally.

Rachel: [00:20:00] Unless I'm being demanded a specific episode that they don't have.

Brian: [00:20:04] Right. Right.

Rachel: [00:20:07] And I'm sure there're more adult examples of that as well. But it's become you don't even think about it, and because you don't have to think about it, that's why the brand equity continues to grow.

Phillip: [00:20:21] It's an interesting thing. I think you had mentioned at one point, like Pete the Cat.

Rachel: [00:20:25] Yeah.

Phillip: [00:20:26] And this kind of ties into, not to take too much of a segue, but this sort of ties into like there are certainly... It seems like an interesting challenge that they're going to have to face in that being a marketplace that is guided by market forces where you have, you know, retailers who are providing products that are in vogue or in fashion is out of your control, you just create the best platform you can, and the two sides of the market place will find each other and those trends can change and grow over time. It's very different when you are owning the culture, and you're creating the trends and deciding as a content provider who wins and loses in creating those cultural moments. And so then you have to worry about lock in, like how do we tie people to this platform? How do we keep it sticky? And as your data found, it seems to be working because the number three most cited reason to have Amazon Prime was original content and programing and not products and other acquisition of goods.

Rachel: [00:21:40] Right. And how much is that going to grow? I would love to know more. And we didn't get this granular in how we asked the questions in this study. But like how many people literally only have Prime for the content and don't even really opt into getting seven boxes a day at their house?

Phillip: [00:22:00] As an aside, too, we had a hypothesis that didn't prove out, which we sort of... I don't believe that it's true now, but I believe it could be true in the future, that there might be a growing distaste for Prime or for Amazon. It may not be here now, but over a longer horizon maybe it's true.

Rachel: [00:22:21] I agree.

Phillip: [00:22:21] And in asking that question, it's a very small percentage of people who would say something like, I can wait extra day for shipping. But globally, Amazon has a lot of customers they can still reach. The earnings call that just happened, I think this week, was in 20 months, they added 35% to Prime membership by going global with Prime.

Brian: [00:22:47] Right.

Phillip: [00:22:47] And so they went from a hundred million Prime subscribers to a hundred and fifty in twenty months. That's insane. Actually, that's 50% growth. So when you're looking at that, you know, the hypothesis doesn't really bear itself out {laughter} because the numbers are proving otherwise. People are buying into Prime and big time. So I think that's where it's sort of like maybe the data doesn't show it. But from like a futurist point of view, maybe the sentiment points away from what the data saying.

Rachel: [00:23:15] I agree. I agree with that because I think as you have sustainability in all its forms becoming more central to consumer consciousness, I think it's unnatural the level of convenience that we have with Amazon. And I think people are having second thoughts sometimes, or starting to just be like, you know, "Wait a minute. Do I really need this now or am I going to stop somewhere on my way home?" or "Should I not be doing this and should all my time not be going to Amazon?"

Brian: [00:23:52] Well, and even more than that, like I think that... You brought up the utility example. We're gonna have other utilities out there. And other utilities are gonna be cheaper. Amazon might be the Verizon of the world, but we're gonna have a T-Mobile. T-Mobile has done really well recently. Like there's going to be ebbs and flows to this because when you start to talk about utilities, you're talking about something that's, I mean, I guess cell services and such are not a good example necessarily of a utility. Like it's a very unique market. But my point in saying this is right now, I would rather pick Amazon than Target because I trust my experience, and I pay for Prime. But someday I might pick Walmart or Target over Amazon and maybe Walmart someday is going to come out with their $35 prime service. And I'll just say, "You know what? The only reason I'm subscribed to Amazon right now is because of their original content, and I can actually live without it. I've got Netflix and Hulu, as well." I've felt that way at times. I have come very close to being like, "The only reason I do this is for original content. I can get the same stuff on at Walmart and Target, and I don't have to continue to do this." Then I'm like, "Well, I really like that original content." {laughter}.

Phillip: [00:25:27] You know what's really awesome is how much I'm going to cut down on this discussion. So we don't talk so much about Amazon.

Brian: [00:25:32] Yes. {laughter}

Phillip: [00:25:33] So do you think... Just kind of getting into other areas that we surveyed. Rachel, what's your sense of the broader eCommerce landscape being able to compete and sort of the direct to consumer segment of that having a formidable offering that poses some sort of alternative?

Rachel: [00:25:56] Yeah, I think, you know, I mean, this is just my gut combined with the data. I think direct to consumer as an experience, as a mechanism, is great branding. I think the idea... I mean, there's always been direct to consumer. There's Sears catalog. That's what we grew up with. So I think it's been enabled tremendously, the cool factor of being a direct to consumer brand has been enabled by social media. And I think that's a great thing. And I think the competition is amazing, the number of brands you get exposed to. I think it's all great. Part of me, the researcher in me and the skeptic in me just wonders if now with all the bricks and mortar you see popping up from successful DTC if we're just going back to what it is now or what it was before DTC became a thing. It's just that we have ways to do it now, right? You know, 20, 30 years ago, there wasn't a way to get new products that you didn't know about that were only existing in certain locations. There wasn't a way to get them unless you went there. Globalization has created the ability, or helped the ability, for direct to consumer fueled by social to grow. And I think about places like Showfields in New York where it's basically a department store.

Phillip: [00:27:36] Well it is a department store.

Rachel: [00:27:39] Right. It makes you wonder, like if Barney's had kind of been a little bit more futuristic and thought about how they could partner with more emerging brands on social three years ago, could they have saved themselves?

Phillip: [00:27:49] They certainly tried.

Rachel: [00:27:51] And I'm sure they tried. But, you know, just if that had been a more concerted pivot. Especially now, there's so many luxury brands. DTC luxury brands. So it's interesting.

Phillip: [00:28:07] And the founder seems to be skewing, I want to say, more female. It seems like at least if you were to pay attention to social, that direct to consumer is giving female founders a fair shake. And that seems like a bit of a change from what we might have seen in the history of tech founders or venture backed tech and fintech startups.

Rachel: [00:28:29] I think that's fair. I also think, you know, when you look at how categories have shifted... If you equate DTC to like opening up a shop, I think when you look at local shops, a lot of them are actually founded by by women. You know, not to overly stereotype, but if you have a small boutique, if you have a gift shop, if you have a card shop, if you have, I'm just trying to think...beauty supply. If you have a florist, there're a lot of traditionally female oriented professions that have always been bricks and mortar female founded. And I think now you have that indirect to consumer, which again, like I said, I think it's great. You know, the other thing is we've known this for decades, women do the majority of purchasing. So women have the purchasing power. Women are able to create businesses more easily, get their audience, get their brands spread more easily, beautifully with the slew of tools that are now available to people. I mean, it's an amazing time to be a founder, whatever your orientation, gender, what not. It's an amazing time to be a founder. I think, though, there's a lot of talk about experience and so much being made about, you know, connection and the tactile component of consumerism that hasn't gone away despite probably a solid decade of people saying that it would. It's just kind of morphed. And I think we'll keep seeing more of it. I mean, I've got to imagine, in three years, or five years, you know, I don't know what their expansion plan is, but will a 20 year old in five years from now, so someone who is fifteen now, think Warby Parker is just a glasses store that they walk by?

Phillip: [00:30:34] Yeah.

Brian: [00:30:34] {laughter}

Rachel: [00:30:34] That's an interesting circle when you think about it that way.

Brian: [00:30:39] It's the LensCrafters of tomorrow.

Rachel: [00:30:40] Right. I don't mean that negatively at all. It's just it's cyclical.

Brian: [00:30:46] Right.

Phillip: [00:30:46] I think it is. I think you're right. If you were to think where Glossier might be in 20 years, you know, there is a series of decisions that's laying in front of them in a brick and mortar strategy that might turn them into a Sephora or Ulta 20 years from now. And then they're just not doing the same thing that everybody else is doing. So, yeah, there's been a lot of think pieces in the last year about is DTC a misnomer? It's a way of starting or it's a means of... It is probably the more modern way of starting a business today. But it's probably, you know, the all paths lead to Oz or whatever. There's a yellow brick road. We're all going to find it eventually, and we'll all be heading toward the same eventuality.

Rachel: [00:31:35] You also think about I just also was making this connection, too. You think about the success of some organizations like Rodan and Fields or some of the essential oils, some of the MLMs that have become really, I think, much more popular because of social, much more visible because of social.

Phillip: [00:32:02] Yup.

Rachel: [00:32:02] You know, those are essentially, those were the precursor to DTC in some ways, too. And they've always been DTC. When are we going to see the big in real life Rodan and Fields in Times Square? I don't know. You know what I mean? It just seems like there's a lot of overlap now.

Phillip: [00:32:20] I feel like we could talk about this for hours. If you were to say, like looking at our data compared to something like Retail Dive, who I have to assume as a real journalistic outlet, they have more money to put into research. Do you feel like we were really far off the mark in their sort of 40% of respondents or 40% of consumers have shopped DTC in the last year, and we said it was somewhere in the realm of 30%?

Rachel: [00:32:48] Yeah, that was encouraging to me. I always look for a few stats here and there to see how our dataset stacks up. And that was encouraging. I think when you know, first of all, I don't have the details on their methodology or how they asked about DTC. And we kept it very succinct and made the assumption that if you are an online survey taker in this era, you probably either know what DTC is or you don't. So I think if you take pains to define that, we could have written a lengthy definition. We didn't. I don't know if Retail Dive did. And then also I don't know if they included people who are offline as well in the study, but that can account for some of the discrepancy. You know, I think the words, I forget which stat it is now, but I looked at another point, and we were pretty much on target with what I compared to that was from a big national regular poll. And you have to, in any kind of online research, you have to just kind of set the floor that you're dealing with an online population. So even though it's a national sample, and it even if it's representative, it's still national and representative of people who are online, which is basically everyone. But you still have to...

Phillip: [00:34:06] But not quite everybody.

Rachel: [00:34:07] ...have that caveat in your head that there are still some people who are not.

Brian: [00:34:11] Right.

Rachel: [00:34:11] They do still consume.

Brian: [00:34:12] Right.

Rachel: [00:34:12] They do still do, you know, do everything. They still vote and any kind of research you're doing, which is why I said in the beginning, you know, I'm not an academic researcher. This was not meant to fully canvass the entire every profile of consumer in the nation. This is really just about national and amongst online.

Phillip: [00:34:32] But let's be honest, even Nate Silver doesn't do that. So, I mean, like we're not...

Rachel: [00:34:36] It's very rare. It's very rare to do that. It's very expensive to do that.

Phillip: [00:34:41] Yeah, I look at other surveys in particular... He gets mentioned on the show way too much. But we love him. The 2pm Henry survey that had, you know, 1800 some respondents surveying what they would say are "HENRY"s or a high earner, not rich yet. That has to be an ordinarily expensive thing to conduct, because it doesn't seem to me like those are the types of people sitting around trying to take a survey for whatever good reason.

Rachel: [00:35:09] Right.

Brian: [00:35:09] Right.

Phillip: [00:35:10] So you kind of have to go get them.

Rachel: [00:35:11] Well, and that's back to my point about, you know, reverse engineering. If you're not doing it in how you ask the questions, you're doing it in your sample design. You know, you have to make a concerted effort if you want to prove out HENRYs do XYZ, you've got to go get HENRYs, and they're going to cost what they're going to cost.

Phillip: [00:35:28] Yeah. Wow. This is fascinating. Just maybe a couple like a lightning round of hot takes. But I do think that the importance here is when we think about where we're going as a startup or, you know, it's more than a podcast. You know, hashtag more than a podcast. Think about that. We can spend probably the rest of our lives podcasting and being locked to the news cycle and talking about things that everybody else is talking about. And people think that we're interesting personalities, and they want to hear our take on it. We can also, and I think this hints at what we're trying to do, have original ideas that we perform original research on and try to bear out like the process by which we are learning to do that as a company or as an organization that cares about trying to predict the future. And then trying to find ways to bear out whether that's true or not. And then telling the story around how we're doing that. I think that's really compelling.

Brian: [00:36:29] And mold how we do things.

Phillip: [00:36:32] It does.

Brian: [00:36:32] Yeah.

Phillip: [00:36:32] It brings people in, rather than people just taking our word for it. We're having a more open and transparent conversation in the methodology and how we're arriving at these decisions. And like even if what we think is not true, the conversation around us being disproven is itself interesting, and I think has more staying power. So for me, this has been such a fascinating thing, and I love having you on the show.

Rachel: [00:36:59] Thank you.

Brian: [00:36:59] So let's do the lightning round. Give us a few more hot takes fast here. And let our listeners hear your take on some of the things we discovered.

Rachel: [00:37:10] I mean, my only other one that kind of is like a little craw in my side is the idea that sustainability is just such a catch all phrase. It's such a catch all phrase.

Brian: [00:37:22] Yes. {laughter}

Rachel: [00:37:22] You know, and I'm guilty of it and everyone is guilty of it. But, you know, it sounds great in theory. And no one is going to be like, "Oh, you know, you're a sustainable effort? That's horrible." Everyone's going to be like,  "That's great. I wanna get behind it." There's so many different forms of sustainability. And I just think, like, you know, I'm just eager to see... Consumers, they think it's all good, too. But I'm just eager to see brands start really defining what they're doing, whether that's upcycling, whether that's starting a program to recycle old goods, whether that's about their carbon footprint, whether that's about how they're sourcing material, you know, whatever it is. And there's some of that. I just feel like I would love in the next few years for the concept of sustainability to have more than just an asterisk of what that means and for the actual actions being taken to get more of the light.

Brian: [00:38:17] It's a good take. I agree with you.

Phillip: [00:38:18] Yeah.

Rachel: [00:38:18] Because consumers are thinking about it, but at this point, they're trying to reconcile this total convenience lifestyle with this quest for uniqueness, which is where I think the second hand kind of comes in. And we've seen this really with the first round of millennials, you know, being in the workforce. We saw this about a decade ago, in terms of how they create their appearance and their personal look or their personal brand and the emergence of social media, you know, dovetailing in with their presentation as professionals in whatever their chosen workplace is.

Brian: [00:38:59] Yeah.

Rachel: [00:38:59] And you saw that that kind of was a little bit of an inflection point of where it second hand... Now, where Rent the Runway started coming into play, just this idea that you could actually create your persona without it having to be new, new, new, high end, high end, high end. And so but it still has to be convenient. It still has to be coveted.

Phillip: [00:39:24] Yeah.

Rachel: [00:39:24] They're not willing to just go with out things as much.

Brian: [00:39:28] Right.

Rachel: [00:39:28] And if they do, it's a signifier. If you're going without, it's because you want to be able to announce that you're going without, in many cases. So there's a difference between... There's still a very big chasm between those who are thrifting for need and thrifting for presentation.

Brian: [00:39:48] Hot take. That is a hot take. I like that. Well, I think you're onto something with the idea that sustainability is confusing. And for those to have a genuine interest in it and don't just do it for the show, it's really hard. It's really like you said, it's not convenient to try and figure out what sustainability actually means, from whatever you're buying, like they might say the word sustainable, and they might have some stats about some things that they're doing, but it's really hard to figure it out. And so I think this is going to be on trend with some stuff we've been talking about on the show already. Figuring this out and making things like this clear is going to be really, really, really, really important for brands in 2020 and in the next 10 years.

Rachel: [00:40:46] Mm Hmm.

Phillip: [00:40:46] Time for one more?

Rachel: [00:40:47] Sure. Do you have one?

Phillip: [00:40:52] {laughter} Well, I was going to say on the on the element of sustainability, I think that there's a lot of credibility coming, when you see a brand like Nordstrom who just announced yesterday at the time of this recording that they're creating a resale channel at Nordstrom called See You Tomorrow.

Brian: [00:41:10] So cool.

Phillip: [00:41:10] And when you see Nordstrom doing that, that's a lot of validation. It's a lot of validation that an upmarket consumer, a higher end consumer, is looking at resale as well. Or this is a way to reach in to mid-market with, you know, still premium brands without having to resort to being off price because Lord knows they already have Nordstrom Rack. They've already done the off price thing.

Brian: [00:41:39] Yeah.

Phillip: [00:41:39] This is a way of getting people into stores proper and have a human relationship. I think it's a very interesting validation of a trend, but a trend can mean a lot of things to a lot of people. And it certainly is a catch all phrase. I'm really interested to see how it sort of bears out. Maybe resale is the way it's kind of segmenting that, you know, either fewer/better becomes a thing or longer life and repurposing becomes a thing. But we start to develop more granularity around what sustainability means.

Brian: [00:42:10] Certainly, I think this is a play at Gen Z because it's clear Gen Z, I think, is more inclined to buy second hand versus like fast fashion.

Phillip: [00:42:23] They're becoming more. Becoming more.

Brian: [00:42:25] Yeah.

Phillip: [00:42:28] That's a topic of a study that we should do with Method + Mode later.

Brian: [00:42:33] Exactly. {laughter} That's exactly what I was thinking.

Phillip: [00:42:33] I want to be sensitive to the time because I think we're a little pressed for time today. This has been just amazing. I love our partnership, and I love that we continue to build on this. Can't wait to have you back on the show to talk about CARLY and other things that I think we're going to be poking into in 2020.

Brian: [00:42:51] Oh, yeah.

Rachel: [00:42:52] Feeling is mutual. Thank you, guys.

Phillip: [00:42:54] Awesome. Thank you. Rachel Swanson from Method + Mode. And where can people find you on on the Interwebs?

Rachel: [00:43:02] They can find me at MethodandMode.co. And that's the best place. On my website. I have a little bit of a blog, and I have a newsletter, and I do cross-post onto Instagram. Still working on the best... Doing my own research on the best channels for getting my thoughts out.

Phillip: [00:43:25] Awesome. Well, thank you so much.

Brian: [00:43:27] Love it.

Phillip: [00:43:27] And thank you for listening. And remember, the future is what you make of it. So let's build a future we can all be proud of.

Brian: [00:43:33] Bye, everybody.