Ep 2: Why brands who are creating communities are leading the way: John Surdakowski

 Callum: Today, I am super excited to have John Surdakowski on the show. John has a seriously impressive CV. John is currently the CEO and founder of Avex. Avex is in my opinion, one of the world's best digital agencies. They've worked on some of the biggest direct to consumer brands, including Kith, and Balance Athletic, 

Katy Perry's recent brand De Soi, as well as working with leading D to C brands. John is also invested of some of the most well-known Shopify apps, including Shogun and Grin without further ado. Let's jump in to today's podcast. John, thank you so much for being on the podcast today. It's a real honour to have you on. Can you tell us a little bit about yourself and how you got started in tech?

 John: Sure. First of all, thanks for having me. You know, I've been following you for quite a while, excited to have this discussion. So how I got started in this industry and kind of how this came to be was kind of an accident. So how I got started in the industry was basically I got kicked out of college for basically not going. And and I got a letter in the mail about like web design school. It was super new back then.

It was probably around 2000, 2001. So like there weren't a ton of agencies. There weren't even a ton of like web designers. It was still really new. I was like yeah, I'll go to try this so that my mom wouldn't kick me out of the house. So I started to go to web design school and then got a couple of gigs doing flash, I was really big into flash animation and websites around that. And then just started to work at some digital agencies before I worked at some larger agencies like Havas and BVDO and MCAT and Erickson did some time at Nickelodeon and Estee Lauder. But I really just wanted to write blog posts and code websites.

 That was like what I was. I just really wanted to work from home. I didn't want to go into the office anymore. So I started doing that. I quit my job. I was writing blog posts. I was writing for some magazines and I love doing it. And then I started to get a ton of work where I needed to hire somebody. So I hired a designer. And then I coded a website for Liberty fashion fairs, which is a fashion trade show and they were actually associated with Kith. So then I started working with Kith and then Pony sneakers, and then some other fashion brands. And before you know it, I had a few people around me. And then in about 2018 shifted over to Shopify plus exclusively and just started to kill it with really great work. 

We're fortunate. There has always been strong, real creative, so we've had some really great case studies. And then having two or three logos on our websites turned into five or seven and then ten. And then we had some really a great case studies and just snowballed from there.

 Callum: You are the go to direct to consumer and it's amazing some of the logos you've got and I feel like I can spot one of your sites just from being on there, is this an Avex and I'll go and look in it is. One thing about all of your sites is the copy is super tight and the color palette, the UI and the UX is amazing. We spoke on LinkedIn about one of the sites that you've recently done, which was Cay Skin And I love that design. I loved the colour palette that was used and I'm not really one for buying a Sunscreen, but even I was like, I need this.

John: Yeah, that was a really cool project. Winnie Harlow is a supermodel here and she came up with this idea and we focused on just the UX/UI design and in some of the branding work for the website. A little bit of a departure and different from some of the more like fashion and luxury work that we've done, but it was really fun.

Callum: If you've not seen it, go off and look at it. It's a Cay Skin, C A Y S K I N. Really good on the colour palette. Did you choose that colour palette?

 John: I believe they had some branding and colours as part of their brand guidelines to start.

And our job was basically how do we incorporate that brand name? That they have in to digital. How do we make that come across well on an e-commerce store, right? So in some cases, We were given the colour palette and some cases were just given a general brand direction. And then we have to like define the colour palette. 

Callum: You guys did a great job on that one. I love that design. So Avex are you guys fully remote?

John: So we were like 90% remote. We have office space in New York city. Last week we met for a team meeting at our New York city office. And then we went out for a happy hour and for some drinks afterwards, which was great.

Callum: Going out for drinks with the a team after a busy week. I kind of struggle with that bit when we was in lockdown in the UK. 

John: Not something that's easy to do over zoom. Like I even spoke to our sales rep today and I said, Hey if there's a good deal that we could win and if the differentiator is that we're willing to have face time with a client in person I'm willing to fly out or drive somewhere. 

Callum: I feel the same.

You're the CEO and founder of Avex. Your investment profile on LinkedIn and on Crunchbase is super, super interesting. You've invested in some of the best Saas products out there. You've got Shogun, Grin, Govalo. And the new loyalty solution, which is coming out, I keep seeing teaser posts all the time and it looks great. I mean, he's creating some great content prelaunch on that. So what's your thought process behind making those investments? 

 John: Yeah, that's a great question. And that's something that's fairly new to me. And these opportunities just kind of started to present themselves as two things:

One, the agency grew, so we started to get more recognised in the space being a notable name in e-commerce and also just personally being able to post more on LinkedIn and provide some value to the community. Shogun had came to me because we build one of the first Shogun, front end, headless websites for a one blade shave. And it was literally, maybe one of like three that came out that year or one of five that came out that year. And I'm very close with with Nick and Finbarr. We've known each other for a few years now and just been a big supporter of Shogun and from the beginning and then same for the other ones like GRIN, GRIN and Inveterate that are both kind of through Dylan and his team, he has some really good opportunities and Inveterate is just a super interesting idea. So like when I try to vet some of these, it's when the ones that are doing something really different or they have those ideas of like, it should have been so simple that someone else should have started it and like, wow, why hasn't anyone done this yet? And that's especially for like, Govalo and Inveterate like those two really stood out, like, why isn't anyone doing this yet?

Callum: I know some people I follow actually just joined the company. So they seem to be doing great things. I think now the next big, big sense products on the Shopify app store. And they're doing great now, but I think that they've got so much space to grow Inveterate, I love it. I just want to see more. It's one of those things. Obviously you've seen it in Europe , played around with it. I think that one's got a great product there. I think the loyalty space needs disrupting, massively. And I think there's so much scope. I think that loyalty space can be looked at from so many different ways. And it's such a big space that there can be several successful apps in that space, looking at it from different point of view. So how are they, most of these deals coming to you?

 John: Yeah. It's more so to be honest, all of those were through just knowing people in the industry and speaking to them, I would say like everyone that I've gotten involved in so far out of those four have been through engaging with them. Prior to like, for example, like I said, the Shogun we worked with them for, for some time became close as far as like utilizing the product and just speaking to headless a lot and things like that.

 And same thing with like a better rate. I think because We invested in GRIN through like Dylan's group. And then he, you know, I became close with him and getting involved Inveterate and also all of them. The strategic investors, too. They want investors who are going to bring value and to talk about the product.

And you could see all of these, all of these products really align well with e-commerce. Shoguns raised a ton of money. And I'm a very tiny piece of that. So it's more so will these products bring value to our customers and to e-commerce community in general. And I bring any value to those companies as well, by talking about it or partnering with them. And I'm definitely not going to invest in anything that I wouldn't advise our clients on.

 Right? I'm going to be able to really believe in the product and really believe that it is a good solution. And then it's going to bring value to their business. 

 Callum: Yeah, no, that definitely makes sense. Great process to take when you're investing in those companies. There's a lot of talk on Shopify apps, right at the minute from Shopify app developers about recent changes.

And obviously there's a lot of chatter on Twitter about cloning, popular apps within the Shopify store. How do you feel about that? How do you think about it? Do not worry about it with those investments? 

John: Where I think Shopify can get really defensive is going to be on the payment side of things. In that specific situation, if you're going to create a product that, literally bypasses Shopify to check out and starts to take away from their revenue.You're going to run into some issues. That would be the same way. If that an app developer created a app for iOS that stopped Apple for making money they're going to do the same thing. In my opinion though, like Shopify already has reviews, but there's reviews companies that are doing well, clearly. Shopify also has some sort of email marketing tool, but Klaviyo is killing it. Shopify, although has You know, sections, but Shogun page builder is still doing well. Shopify has gift cards go Govalo co come out and is doing gift cards better. So like, same thing with iOS though. 

 Callum: I think it's the support as well. I see that a lot that they want to merchants want to be able to go online, chat and speak to, or pick up a phone and speak to someone. What trends are you seeing in e-commerce at the moment in direct consumer brands that you think will only get bigger and bigger? 

 John: A few things. One is going to be community which relates to loyalty. A lot of brands are talking more about developing more of a community around their brand and that sort of even relates to like what's going on with web three, which I don't know where that's going to fall in to e-commerce. I think it's so super new that, that it's definitely going to continue to grow. Not it's not going to look the way it does now. It's going to take some time for brands and marketers to really figure out where web three fits into e-commerce. The whole idea about community and giving customers more of a say in what's going on in the brand. I see that being something that more D to C brands embracing. 

 On the e-commerce or like technology side. I definitely see Headless, which was far more of a buzz term last year or the year before. I still see that as being something more and more popular that brands are approaching or adopting in some way, shape or form, and I think Shopify is going to play a huge role in that. I think Shogun. Some other products that are coming out are really going to help try to solve that. And I think it's a question of who makes it more easier to do because right now it's very complex. But I do think that speed is going to continue to be super important. And headless clearly plays a role in that due to how fast you can build progressive web apps. 

But back to the community thing. I see a lot of brands embracing community, more, a lot of brands like rethinking loyalty rethinking, and especially with like the iOS updates that have come out for like that are impacting Facebook ads. Because if your entire business was run around running Facebook ads and having a funnel, you're going to take a huge hit.

But if you had a really strong loyal community and one brand that does this really well. Mid-Day squares. If you're familiar, they make like a functional chocolate bar. Really cool brand. They're starting to get really big and they not only do they have a really great product, but they really focused on community and They are like telling their story as they're building their brand.

 So like you know, they're like doing like music videos and they're dropping an NFT and they're like talking about like their law suit with like Hershey's or some cease and desist and they turn everything that's going on in the business into content. So it gets customers excited about the brand. You know, it keeps them engaged.

They're really building a community, right. I don't even think they run Facebook ads, you know, I'm sure they do, but like, they're probably not as reliant on it as some brand that's just pumping out ads, you know, still really think that that's one of the big trends is like focusing on that community. 

Callum: I definitely see community as being a big trend. think that plays a part in what we do at reviews and loyalty. Because it's the brand that is closest to the customer will always win and community does that. It brings your customers closer to you. But that brand I'm sure I saw them on Tik ToK. 

 John: Sure. They're all over the place. They're always doing crazy videos. It's great. 

Callum: I've definitely seen one of their videos. What I'll do, I'll post the link for that at the end of the in the notes of the podcast, what's the best e-commerce brand launch that you've seen recently?

John: Ooh. I don't know if I could choose just one. I mean, I would definitely say Mid-Day Squares again as a really big one, but one really great brand that I see that came out. They've been around for a couple of years now, but Liquid Death, the water company, I think they came out swinging and they've just blew up because it's such a different brand. Like they took a death metal, heavy metal logo and turned it into a brand for water and there's people getting it tattooed on themselves. That's another brand that like really focused on community because what they did was like I don't know if you're familiar with the heavy metal scene, but like when I was younger, I used to go to all these festivals, like Oz Fest and like all these big shows and there was never any water brands.

 It was always Red Bull and energy drinks and beer and booze and Jägermeister. and all that stuff. They came out and was like, Hey, there's no water brand for this community that already exists. So they've tapped into a hard rock, heavy metal community and said, Hey, look, let's put something in there.

That's not alcoholic that doesn't taste like crap. And that it's like, you know, just really good. And there are so many angles there cause there's the sustainability angle from not using plastics. There's the non-alcoholic angle. There's the cool vibe and like branding angle. 

Callum: The branding is so strong. It is an awesome launch. Yeah. 

John: Yeah. And it was a built in community. So that's another thing about building communities is that you don't necessarily have to build one just around your brand and start from scratch. What they did was there was already a community there. It was just an untapped community that no one was speaking to.

So brands that come out that could kind of identify that community, same thing with like some of the other launches that we've done, like Katy Perry's brand, De Soi. That we just recently launched. That's making a pretty big splash. That's an untapped like it's non-alcoholic and it's a different type of apertif.

 Same thing with Cay Skin, a very untapped community, because it's specifically for people with certain skin conditions to all different types of skins. So finding those little community and becoming very niche, and figure out a way, how to scale that and go to a larger audience. But starting with that pre-built community, those are the ones that are really interesting to me. 

 Callum: The liquid death thing. I love the branding that they've done. It's monster for water. It's exactly. It's like niche beer company, but without doing the day, without going through the hassle of creating the bag that you just worked so hard on the brand. I was reading some of that copy the other day and I'm fascinated by copy at the minute. And there's no wasted copy in there in what they do every word had a punch to it. So what advice would you give to a DC brand that was just starting out?

John: Well, definitely built community, but that's easier said than done. It really depends on where you're starting. Because like you could be bootstrapping it, or you could be funded if you have the funds and the backing you could really play the long game or try to scale a lot quicker by engaging with content creators, engaging with influencers. The creator community is really huge. So like, if you have the funds to be able to do that, to work with a lot of different influencers, I think that's a quick way to kind of leverage someone else's platform and someone else's community. And that's kind of like a no brainer. I'd rather put funds into influencer marketing then into Facebook ads, right? I think you're going to have a bigger bang. As long as you find the right influencer, who's going to really care about the brand and that you are targeting audience. I think that's a good way, but a lot of D to C brands, if they're bootstrapping it, that could be a really expensive way.

 So one big mistake, a lot of D to C brands make or brands in general, they invest way too much money into like their branding design and their website. Like we've had brand new brands come to us and want a completely custom e-commerce experience and spending six figures on doing that.

You're eating up a lot of your capital when you know, you need that. So my advice would be just use a pre-made Shopify theme and make it look really cool. Invest in content. Investing copy, invest in partnerships and focus on those things in the early stages to really build your community.

 You don't need to spend $200,000 on a headless website build that's completely custom and unique. Like I've seen brands scale and do tens of millions of dollars on using like a pre-made theme. And we build custom websites from scratch. And I'm still telling you that. Where you should reinvest that is prove that your product works.

It could sell, that you built a community, that your customers really care more about your product than they do what your website looks like. Once you get to that point, then you can reinvest in things like conversion rate optimization and a unique customer experience, unique user experience and start to like slowly add it from there. I guarantee you all those successful brands didn't throw all their money into a website design when they first launched.

Callum: It depends whether this is your first rodeo or your second or third rodeo as well. Doesn't it? Because you see that. Some founders, second time founders and third time founders almost instinctively know that their product is going to be huge. They have a knack of taking the winners and they know to invest in the right places at the right times.

 So on Shopify, do you think anybody can challenge them? Can any brand come through? Shopify is the biggest player. 

John: Yeah. 

Callum: Do you see anybody coming through to challenge them? 

 John: There are other platforms that are challenging them, but they're very distant seconds.

But it depends on what you compare it to. So if you're, if you're going to compare it to another monolith platform, Big commerce. Right? Shopify is light years ahead of big commerce when it comes to the size of brands that are using it, and even in the amount of merchants and the usability.

 So I don't think anyone's going to come close to Shopify as an all-inclusive model. Easy to set up platform. You could literally spin up a store tomorrow and start selling products on Shopify plus or Shopify. And no one's going to do that as well as them, at least not coming out of the blue. They would have to really drop the ball and someone's going to have to come in with something that is better than Shopify which is kind of hard to do. But if you compare it to something else, I do think there's some challenges there that have some interesting products that do something really different.

Like you have headless solutions that are targeting brands that are much larger, that are taking more of a mock approach like that are aligned with a mock Alliance like microservices, API, cloud and headless what Shopify can do in a way. If you're a larger enterprise brand, you could definitely grow your brand on Shopify.

 It's been done. You could use it and you could go headless with Shopify if you really need to push the boundaries of it. But when it comes to an easy to use out of the box monolith platform that has everything you need for e-commerce no one's going to really compete with them there as, but I do see some of the bigger players competing with them on say like 

I see there being. You know comparisons with something like commerce tools or Salesforce commerce cloud, or Vitex, those are some of the players that I see being larger competing with them, but no one's going to play. No, one's going to even come close when it comes to like an all-inclusive platform, especially for like smaller mid market brands. Shopify would have to basically foul or do something really stupid for Big Commerce to catch up.

 And Magento just doesn't seem like they're paying attention to image or people anymore, but 

Callum: Brendan's do you know, platforms do make mistakes? Look at my gen. So I'm against to Magento. It was theirs to lose at one point in the game. They were that in fact, E-commerce platform before they work.

 John: Yeah. They dropped the ball, but the agenda is always been complex. Right. It's always been, yeah. Intellects. And I think that they could have did what Magento did, but they were also acquired by Adobe, which I don't think they knew exactly what to do with it. Like Adobe seems to be more focused on like commerce cloud and like more enterprise. They were around before Shopify, they could have definitely been like, okay, well we need to do more of an easier solution. So I definitely think that they dropped the ball a little bit on that. But you know, I think it would take a long time and a lot of mistakes for Shopify to mess this up. 

 Callum: Shopify makes great hires, they've got great people working there. They've got talent. they're not sitting on any of their laurels. They're they're stilling innovating and producing great tech day in, day out. So I don't see anybody coming for them any time soon, as much as I think it's always good for a platform to have competition because it keeps everybody on their toes. So what developments are you most excited about in e-commerce over the next 12 months? What are you seeing?

 John: So I think over the last couple of years, some brands went headless that shouldn't have. I think we're starting to really see brands, understand it a bit more and know when it's right to go headless. I still think it's going to be very popular. It's not as much of a buzzword as it was before. And now we're starting to see things like the mock Alliance. We're starting to see things like like the talk about composable commerce. I do think that in Shopify releasing hydrogen and oxygen and things like that.

So I do think that that's going to become more of the go-to way to be able to build high performance and really fast e-commerce storefronts. That's absolutely going to get more and more popular. But I do think people are getting smarter about it. Because we don't get as many requests for it from the smaller brands, because over the last couple of years, it's like, oh, we want to go headless.

 Callum: They're just ticking a box, aren't they? 

 John: They have no idea of the complexities behind it, or the investment involved or how much it's going to take their team time to update content and all those other things. So I think there's more education around headless.

That's something I'm super excited and that we're starting to talk a lot more about when it comes to who's right for headless. And what are the different ways to be able to do it, especially on Shopify plus - super excited about hydrogen. And I think that's going to be a game changer for Shopify when it comes to creating really unique storefronts. It's just gonna make building regardless if you call it headless or not, it's going to make building really fast storefronts, a lot easier. And there's a lot of interesting products coming around headlesss, you know, when, whether it's Shogun or what Shopify plus is doing, or like there's a few other products out there that are pretty interesting. And then there's like more micro service solutions like commerce tools and things like that.

So just really exciting time for e-commerce in general. 

 Callum: I think it's so exciting. I think we're, you know, we're really seeing. E-commerce throughout the pandemic, obviously had a massive boom and we've seen all these brands, some brands that maybe were struggling become really successful overnight.

And then post pandemic I'm seeing quality the sites that are coming through now, a really good quality to sites that are relaunching or really gaining footprint really, are really good quality now. And it's exciting. It really is an exciting space. But I think e-commerce is definitely going to be a, good space to be in. 

Thank you, John, for being on the podcast today. It's so, so interesting speaking to you. You're clearly very intelligent guy and I hope to meet you up for a beer very, very soon. 

John: That'd be great.

 Callum: Thank you for listening today. In reviews we trust is a bi-weekly podcast where I hope to be bringing you advice and insights from brands that are taking the e-commerce world by storm.