Former GoDaddy CEO Says Retailing Can Surf Rising D2C Wave

The intersection of creativity and brands used to be populated by the “Mad Men” types of the 60s and 70s. It was all about the campaign, the image and the three-martini lunch. Now, a brand’s creativity is expressed digitally in media and through websites, but it’s also expressed through its business model and, to a lesser extent, its technology. It’s a whole new package for a new business landscape.

Creativity in the post-internet world is something Scott Wagner has had a front seat in witnessing for most of his career. For 13 years, he worked on the private-equity side of the business at KKR, where he helped brands operationalize their creativity. And as the former CEO of GoDaddy, where he held various executive roles starting in 2013, he was part of a company that provided the very foundation on which thousands of companies built their digital presence. In a recent conversation with PYMNTS’ Karen Webster, Wagner observed that creativity expressed in the uniqueness of an idea is the lifeblood of a brand – and no amount of technology can give that to a brand (or replace it if it’s lacking).

What technology can do, said Wagner, is give the brand the ability to actually operationalize those ideas and get them out there. The brand can ask themselves the right questions about how to perfect and optimize their offerings, instead of falling down the complicated rabbit hole of trying to figure out how they can get it done on the backend.

“The data and technology let you find the right audience and channel in a super-easy way,” he explained. “In some ways, it  takes the friction out of brands thinking creatively and testing out their offerings.”

Wagner recently took that approach to the cloud-based eCommerce solution Scalefast, where he is now a board member. As he told Webster, the data and technology that reaches the right audience has manifested itself in the brands (big and small) that have modified their products and business models. He pointed to the continuing emergence of brands offering things like exclusive product drops for customers, and even exclusive product lines for direct-to-consumer (D2C) channels. It creates a sense of exclusivity, which has myriad advantages: It creates buzz, has a cool factor that is hard to quantify and provides a new way for branded firms to create deeper relationships with their consumers. On some level, said Wagner, it’s hard to understand why every brand hasn’t moved in the direction of the exclusive offering – until one realizes that creating such exclusives hasn’t been all that easy, until recently.

“The act of setting up a separate online experience to invite selected customers and then shutting it down? The technology wasn’t flexible enough that a firm could come up with a new idea and make it happen in the next three weeks,” Wagner said. “Now, the technology just works. And I think that’s the promise these brand companies have been missing.”

Moving The Magic Into The Physical World

The explosion of online possibilities in D2C-branded offerings raises the bar for physical retail – but the ways in which that happens are more experiential than technical, Wagner explained. Physical retail should present an environment the consumer wants to spend time in, he added.

And that’s not a small challenge, because consumers have become so habituated to an enhanced online and omnicommerce experience that they’d rather have it delivered to their door than spend a night sleeping on a sidewalk for the thrill of being among the first ones into a store on iPhone release day. A wide variety of goods was once a real competitive factor for places like department stores, but not so much anymore. No physical store will have a wider variety of goods on offer than the entire internet. That means the really hard question retailers have to answer is: “What beyond the product is pulling people in?”

“There’s needs to be a higher bar than just having the goods,” Wagner said. “There has to be some service, some real experience around it that makes someone want to get there. Otherwise, most consumers are firing up their devices and going online. The big macro point is that branded goods sit in the nexus of online and physical, and to the extent that you can marry both, that’s great. But online still has all the tailwind.”

In the end, Wagner said, beyond specific channels and the tools and tactics of each, it all comes down to the quality of an idea and its execution. D2C models, in their various forms, allow brands to control their inventory, manage their supply chains and shorten their product cycles on the back end – all while delighting their customers with a better experience on the front end.

“In some ways, it’s an incredibly valuable commodity on the back end,” Wagner said. “If I can help somebody sell something or get them more revenue, all sorts of opportunities pop up for expansion and improvement.”

The GoDaddy Experience

Scalefast currently navigates a world where almost every company has a sophisticated website. It can be hard to remember that in the early days of the internet, pulling together even a basic site was a massive technological challenge requiring the aid of a small army of HTML coders to get it up and functioning.

When GoDaddy came along in the early 2000s, Wagner said, it cut out all of that complexity and made it easy for anyone with an idea to get a website with ease, “consumerizing the act of getting online.”

In a similar fashion, Scalefast brings simplicity to cloud-based eCommerce infrastructure. Wagner liked the similar focus on simplicity when it comes to firms managing their digital commercial presence. Because as he noted, being an online retailer doesn’t just mean selling on one’s own website or Instagram – it means being able to sell anywhere one’s customers are liable to be.

“It means controlling and selling everywhere and being in the environments where you want to match your product to your customers,” Wagner said. “And that’s expanding, not contracting. The trouble is that the technology that enables this is based on 25-year-old custom code that is a snarled mess. It’s slow. Brands need a whole corps of engineers on the back end to manage it. Scalefast is letting brands create their environments worldwide, easily and seamlessly.”

In many ways, Wagner said, Scalefast allows brands to get “back to the art” of looking for great ideas that will catch fire and delight their customers. Technology and data are making it easier than ever to then match those ideas to their audiences in a variety of ways.