Interview with Mike Gammarino - eCommerce for Brands Today
Elliot Begoun, brand champion and founder of TIG Brands, interviewed me recently to discuss how CPG (consumer packaged goods) companies who are retail/wholesale only can dip their toes in the DTC (direct-to-consumer) eCommerce channel. We run through a broad range of topics from the key items to look for in a 3PL (third-party logistics) partner to the most common mistakes brands make when starting out in DTC.
Our conversation lasts about 45 minutes. Below is a link to the video and a list of questions that Elliot poses along with timestamps if you’d like to jump right into the action.
Enjoy!
Mike G
General eCommerce & 3PLs
[5:15] If a brand is on this call right now listening in, thinking about, “How do I make this transition?”, “How do I begin to really lean into eCommerce?” What steps do you outline as a starting point?
[10:05] What are some common mistakes that you see in companies, CPG companies, in particular, making as they roll out into eCommerce or trying to expand their eCommerce footprint?
[12:40] As you assess a 3PL, what are the must-haves? What are the things that you would see as either a red flag saying this is not one to pursue or signals that this is one worthy of exploration?
[15:20] Do you see the pricing on the refrigerated and frozen [channels] becoming reasonable as more brands utilize and optimize eCommerce as a channel?
[16:48] What should a brand be considering as they look for packaging [and] shipping? Do they [use] a hub and spoke model, so they’re always within 2-days ground shipping from their core market? What are the best practices for that?
[19:21] If a brand [wants] to serve their consumer nationally, is it better to look for a 3PL that has multiple sites? Or does that not really matter, just look for the best provider in the given markets that you’re trying to penetrate?
[25:20] Given all the assessments that you’ve done, how many cold chain 3PLs have made your shortlist for recommending the clients?
Fulfillment by Amazon (FBA)
Fulfillment by Merchant (FBM)
Seller Fulfilled Prime (SFP)
[27:22] What are the risks of changing from FBA to FBM and offering Seller Fulfilled Prime?
[30:27] How does a brand assess whether they’re better off or better served by doing Amazon FBA or trying to go through a 3PL and do FBM?
[31:20] If choosing between FBA and FBM, how do you make that assessment? Does it have to do with bandwidth? Does it have to do with velocity? Do you recommend that brands start FBA that are smaller or newer to eCommerce?
[33:07] In your experience, do you think consumers prefer free shipping at a slightly higher price or cheaper price but expect to pay $5-$10+ for shipping?
[34:27] This is specifically for younger, earlier-stage brands: Do you start a DIY mentality, out of the garage pack and fulfill? When is the right time in your mind to move to a 3PL? And then also, when is the right time to make that delineation between do I go Amazon, do I go straight on my website, etc?
[36:25] Bringing traction to a 3PL not only helps them get interested but also helps you get a better price?
[38:54] 3PL integration with software in particular, what do you see as kind of best practices? Shopify, Woocommerce, etc?
[39:57] About negotiating the actual shipping, is that something that brands should be doing directly with UPS or FedEx or USPS or do you lean on your fulfillment provider to collaborate their negotiation rates?
[41:03] What have you seen in the last four weeks that has surprised you in terms of change and what do you think is here to stay and that brands need to be considering?