Convenience Matters Intro:
[Music] You’re listening to Convenience Matters brought to you by NACS. Whether it’s for food, fuel, drinks or snacks, about half of the U.S. population shops at a convenience store every day. We’ll talk about what we see at stores and what the future may hold for our industry.

Chris Blasinsky:
So in our industry, some leaders innovate and some leaders hesitate. So today we’re talking with Andy Ellwood, who is the president and co-founder of Basket. He also has a lot of experience with startups, creating them and selling them. So we’re excited to have Andy on board today. My name is Chris Blasinsky with NACS…

Britt Brewer:
and I’m Britt Brewer with NACS.

Chris Blasinsky:
And, welcome Andy, it’s nice to have you.

Andy Ellwood:
Thank you so much for having me!

Chris Blasinsky:
Yeah, absolutely. So, before we dive in, I did a little bit of research on you and I didn’t stalk you too much on social media, but maybe just a little bit and I came across your blog and since we’re bloggers here, I always go to those pages first. I think they’re the pages that show the personality of someone. So I came across this blog and I’m just gonna read it. And then I want you to take it from there after I do that, I don’t want to give away the punchline. But I will start to say that social media is testing and learning and that’s all I’m going to say. So here it goes. “This is your chance. I promise I won’t be offended. Please unsubscribe from this email list I am using to send this email. If any of the following apply to you. Number one, you have no idea who Andy Ellwood is. Number two, you know who Andy Ellwood is and you dislike him. Number three, you aren’t interested in keeping in touch with Andy Ellwood or seeing infrequent, but hopefully entertaining updates. No judgment, unsubscribe from the list. I probably won’t even look to see who unsubscribed.” Alright, Andy, what were you doing?

Andy Ellwood:
So I have over the years collected emails, added them to a newsletter that I send out at most, maybe four times a year. Sometimes it’s an announcement going on with a company that I’m involved with, some personal things are happening, I moved, updated…but it’s never meant to be anything soliciting anybody. But I also really want to make sure that when somebody sees my name pop up in their inbox it’s not, “oh God, not again.” And I was basically double opting them in and asking them for permission to show up in their inbox again. And what was really fascinated with the amount of people who unsubscribed was half of the number of people who said, “I will never unsubscribe, no matter what you do.” And the next time I sent an email, I knew that I was sending it to a very open and engaged and actually receptive audience, as opposed to saying, “oh, I don’t know if this person really wants to hear from me anymore.” And so it turned out to be an experiment that I tested and I’ve had a lot of confidence and a lot of great returns since then.

Britt Brewer:
So, as a marketer, I find that brilliant, Andy. I think it’s a really smart way of, I don’t know that it wasn’t so that you can solicit more. You made that very clear. But if I was even a little bit questionable about who Andy Ellwood was at the time when I received that email, I would have been like, “oh, okay, well, I’m just going to double-check,” and force people to probably be like, “oh, I know that guy,” or “I don’t know about him…I didn’t know about him, but I do now. And I’m not unsubscribing.” I think it’s a very smart move.

Andy Ellwood:
Thank you. Yeah, my open rates are, you know…click through rates are kind of the two things I geek out on whenever I send my newsletter. And both of those are up by probably 10 – 15% since I sent that because the people who didn’t want to be there, they exited the room because the people that were there, were really there. And so it’s been a fun experiment that has led to a couple of years of great responses.

Britt Brewer:
I mean, nothing more powerful than an engaged audience, right?

Andy Ellwood:
Nothing more powerful, indeed.

Chris Blasinsky:
Yeah. I thought that was clever. That caught my eye. I liked that one. I also noticed on your website that, of the things of your career and your work experience, you also list amateur chef. Yet, that was the one thing I couldn’t find anything on. {laughter}

Andy Ellwood:
So it all started…quick backstory…it all started…I ended up getting divorced back in 2015. And so the solo bachelor in the west village in Manhattan and my mom is a big social media person. It’s the way that she keeps in touch with all four of her kids. And we’re all at different parts of the world, but we’re all pretty active on social media. And so I kept just tagging the food that I was making in my little apartment in New York City with like hashtag Chef Andy. And I met a lot of people as one does when change of life happens. And over the course of that year, people that I met didn’t actually know that I wasn’t a chef. And so I remember getting a phone call from a new friend who said our celebrity chef for our nonprofit fundraiser, just canceled. Would you be willing to be the celebrity chef for this event? And because I like to try things and figure it out, see if I can do it, I said yes before she told me that there were 40 people of which 13 of them were vegan, 7 were vegetarian, and 2 had nut allergies. And I don’t know how to cook for that many people with that many disparate things, much less in a small two burner stove in the West Village, but was able to recruit a friend to help me. And we put together a bunch of trays then Ubered it all over to the events and I stood up and acted like I knew what I was doing and that actually spawned a separate Instagram account that’s called Chef Andy. And I call that Instagram account my visual menu for the next time we hang out and I’m cooking and actually have people go through and they’re like, ‘ah, that picture…I’ve been looking at that picture. That’s what I would like to eat next time we hang out.’ And so I use food as a way to bring people together.

Chris Blasinsky:
Fake it ’til you make it, my friend. So one of the interesting things that I…in my course of stalking you on Instagram or in LinkedIn over the past few days before we had this conversation is that I came across a couple of presentations you’ve done and one of the ideas that I thought was really interesting is you are a salesman, right? Like, that’s your background. You have a really good way of explaining how to get someone to yes. And I was wondering, could you touch on that a little bit, because I think that that’s a really interesting way to not just take that no for face value and really dig in and see how you can get someone to the yes, past the maybe.

Andy Ellwood:
Absolutely. Yeah, absolutely. I think that the one of the things I think is most important in any role that you do or play into their professional life, but also in their personal life is to understand that there’s certain things that you can control. And there’s a lot of things that you actually can’t. But if you focus on the things that you can control, that gives you a lot of confidence around what you’re putting out there and we can’t control, who says yes, and who says, no, we can only control how many times we ask. And so as a general rule, I assume that if somebody tells me no the first time that I asked the question, they just didn’t understand what I was asking them. Obviously I did a bad job explaining. That’s the only reason they could possibly say no. But what I’m hopefully doing in the way that I reframe the questions and the way that I re-ask the question is getting to a little bit closer to why they’re saying no, right? Everyone’s reaction when somebody says, “hey, do you need help find anything today?” “No.” Even though we actually have no idea where the thing is that we’re looking for in the store, right? But our first reaction is to say no as a kind of a bluff, a little bit of a pushback. So I assume that that’s going to happen. And I always try and think about what’s going to be the next thing that I say to maybe open up the engagement with the conversation. And I use that to zero in on is it is now not the right time for us to be having this conversation. Is there something else that is in the way of us making this decision? Are there other people that need to be involved in the conversation? And that’s why you’re saying no. I don’t believe in ever accepting a no from somebody who’s not in a position to say yes.

Andy Ellwood:
And I think that’s an important thing to be able to suss out as early on and into a conversation as you can, but understand that you just control how many times you ask if, on average, let’s say if you have 10 people that you talk to, three of them give you permission to ask a few more questions. Of those 3, one of them is actually going to say yes. Well, I don’t know which of the three is going to say yes, so I just have to make sure I get to talk to those three people. And of the 10 people that I reach out to, I don’t know which three are going to allow me to have a conversation. So the only thing I control in that situation is reaching out to 10 people. And if I reached out to enough 10 people, I’ll get enough ones to be able to be successful.

Chris Blasinsky:
Yeah. I’m hearing the, themes resonating. It’s quality versus quantity. Quality leads.

Andy Ellwood:
Yeah, absolutely. I think that there’s, there’s an art and a science to it. And you know, the science being the law of large numbers. You gotta get enough tens in the top of the funnel in order to have some ones pop off the bottom. But the way in which you communicate the style in which you speak, the choice to lean in or the choice to pull back, that’s really the art. And that’s going to be different based on who you’re talking to, the circumstances in which you’re speaking and what offering you have in that moment. But being able to be adaptable, a friend of mine calls it the…we have IQ and ET, she talks about AQ, the adaptability question. How adaptable are you in the moment to be able to understand what’s going on in the situation and to be able to roll into that situation where it looks like you feel really comfortable, even if you don’t. I think that that’s something that with the speed, with which things are changing right now, there’s gonna be a lot more adaptability quotient decisions on the move forward.

Britt Brewer:
So I really love that process. I think it’s brilliant, that game of numbers. It’s…you add a little sprinkle, a little charisma in there, and you’re going to get more yeses. Asking enough people in the right way and we’re going to have – I like that – the ones popping out the end of that funnel. That’s great. You started Basket. What is it and why did you create it? I’m kind of curious about like your creative process behind these brilliant ideas you’ve had.

Andy Ellwood:
Thank you. I appreciate that. When I looked back over the startup side of my career, that there’s a reoccurring pattern, which I call collective knowledge. The idea that you have a piece of information, I have a piece of information, if we put those two pieces of information, we have some information that’s better than each of us holding onto that information by ourselves. But if we can find a way to utilize technology to exponentially grow what each of our one piece of information put through an algorithm or put through a platform could lead to a much bigger conversation. That’s kind of been something that I’ve been really obsessed with for the past decade or so. And an example that a lot of people have heard of is Waze. So when Waze was an-up-and-coming location mapping service coming out of Israel, I was fortunate enough to help open the New York office. And what we were building out was this idea that I’m on the road and our phones are capturing a lot of passive data while we’re using a map. So instead of just using a map, what if we were able to capture that, that passive data that’s being collected by our phones and actually help other drivers with that information. And then there’s obviously the proactive side of it on Waze that where you’re able to report a traffic accident, you were able to say, there’s a speed trap up ahead, that this road is no longer open, or you need to make a different turn. But the passive side of it was something that I’ve been really obsessed with and Basket.com was a project that I started working on a year or two after Waze was sold to Google.

Andy Ellwood:
At Baskets.com, we built the first ever smart shopping list powered by a community of shoppers that hated overpaying for groceries. So the basic idea was if you put in all of your items onto a shopping list, and you told us what you were planning to buy, we tell you every store within 10 miles, that carried all those products. And then what the total price at each store was for your entire shopping list. And we got inspiration from that from Kayak.com. So when I travel, I go to Kayak, I say, I’m planning to go from New York City back home to Dallas and I want to see my family and these are the dates that I’m looking for and Kayak searches everywhere and pulls all that information into one place. And then I can make the decision. You know, I’m usually pretty loyal to American Airlines – I have status on that airline – but I know what that status is costing me because maybe there’s a flight on another airline that’s a little bit cheaper, but I’m like you know what? For the chance of getting the upgrade for knowing exactly where in the terminal, knowing exactly my way around the American Airlines terminal, for the comfort of being greeted by name and them knowing that I’m a gold status member, I’m going to pay a little bit extra to go fly American. Same thing now with basket and groceries is you may be used to go into a certain store, but you find out that it’s actually $20 more expensive this week, you have the choice to say, “you know what, just so I don’t have to rethink how I walk around the store, I’m willing to pay $20 bucks,” but at a certain point that convenience or that comfort that you’re used to, there is a price that you willing to put on it.

Andy Ellwood:
And that’s one of the things that we find really, really fascinating in at Basket is what we call a proximity pricing preference. How far are you willing to go to save how much money? And what we found is that it’s different based on the day of the week, the time of day and we’re guessing – there’s no way that we can track this – but we’re guessing how many kids are in the backseat of the car. That on a Thursday evening at 6:30 PM, people don’t really care how much it costs, they’re going to go to the store that’s closest to them because they gotta get food on the dinner table after soccer practice. On a Saturday afternoon, kids are at a birthday party, you got a couple hours to kill. Maybe you’re willing to drive a little bit further in order to take advantage of that really good price on this week’s stock-up trip.

Andy Ellwood:
And so that’s really been something that we thought a lot about, and it turned out in serving shoppers, we’ve actually been able to serve the industry as well by treating the data source that didn’t exist before, through understanding at a macro level, the way that different people are making those decisions that the things that are, are going to move their shopping list from one store to the next or even online versus delivery versus curbside pickup. So many options now in the grocery industry has really made Basket a go-to resource for shoppers across the country. I frequently will say when I’m thinking about investing or advising in anew company, is if this company succeeds who gets pissed off, because if nobody’s angry that your company is succeeding, are you really doing something? If everybody’s like, oh yeah, come on in, there’s plenty of room. Maybe you’re not doing something so interesting. And so building something that frustrates or makes the establishment makes the incumbent rethink things is something that I think that a lot of really innovative leaders have figured out how to have the right amount of tough skin to say, “Hey, we’re going to go do this, even if people don’t like it because it needs to happen.” This is where the industry needs to go. This is what our company needs to do for what comes next. Because if it’s just like a…it’s a nice to have the, analogy that I use a lot is, is it a vitamin or is it a pain killer. If I forgot to have my Flintstones Vitamins this morning, I’m going to be fine. But if I’ve got a headache and I can’t find Advil, I will stop what I’m doing. I will literally leave my home and go to the nearest convenience store to find, or to pick up my Advil. I won’t do that if I forgot my vitamins, if I’m out of vitamins this morning, I’m not changing too much of my day. But if I can’t find my painkiller, I’m changing my whole day to go get some new ones. And so when you think about an idea, I think that that’s a really good lens to look at it. Is this a nice to have vitamin or is this truly a pain killer?

Chris Blasinsky:
Sure, and I think a lot of folks in our industry can relate to the price sensitivity of a commodity because we sell 80% of the fuel in the country. I mean, there’s a gas price sign right outside. It’s advertised every single day, every hour, what that price is per gallon. And whether we… we studied the tipping point that we found – and this was many years ago, I honestly, I think it was over a decade ago – was at $3.71 a gallon was the tipping point to where consumers would drastically change their behavior. And in some parts of the country, it’s been that and then some, since we did that study long time ago. But there is a point where consumers will change their behavior and I imagine groceries are probably right there in the top two of commodities where price sensitivity comes in at that consumer level.

Andy Ellwood:
You know, groceries are the fourth largest use of household GDP. And the most frequent thing purchased by families. And so…and it’s funny, everybody knows someone who is the person that knows the price of everything. That if they were on The Price is Right, they definitely would win, you know? And what we’ve done is said, “hey, Basket is that in your pocket.” Being able to look up any product at any store ,anywhere nearby and see what the price is from your couch, from your kitchen before you go to the store is a pretty cool thing. But especially the big basket view, like when you’re looking at your entire shopping list for the week to know, hey, these 24 products…it’s $118 here, it’s $126 there, it’s $150 there and if it could get delivered in the next hour, it’s $186. Great. Basket, we don’t care where you actually go, or what decision you make, we just want you to originate your, your shopping experience on our platform,

Britt Brewer:
Make the best decision possible for you, your time, your family and your pocket book.

Andy Ellwood:
Absolutely. You’re in marketing, huh? {Laughter}

Britt Brewer:
Ah, you picked up on that, didn’t you. I got a question for you without divulging, maybe the secret sauce or sharing any secrets. What’s next, whether it’s for Basket or for…what can you share with us? I’m curious with the big, next thing is.

Andy Ellwood:
Yeah. I think that across the board the the idea of transparency is no longer going to be the exception, but it’s going to be the rule. With the rise of blockchain technology and the ability to have lots of distributed places for data to exist, I think that the expectation from the consumer is that they’re able to have all the information in front of them and make an informed decision and make a decision that’s independent of the platform on which they are gathering that information. You know one of the things I think we’ve seen especially over the past few years with just the amount of power that exists between four big companies out on the west coast, as far as technology is concerned, is that they had their heyday. But I think that that rein is coming to an end as far as the consolidation of power just with four big tech companies.

Andy Ellwood:
And I think that there’s a lot of early stage technology that’s coming up with decentralized finance for the banking industry as well as the different platforms that are going to be hosting, whether it’s your browser that doesn’t track you every single place you go on the internet. The ability to actually be in charge of your data and your information, I think that’s a really big deal that is going to have huge implications for the way that industries change and evolve in the future. I’m okay sharing my information, but I want to understand why my information’s being shared. I want to choose to share that information, and then when I’m done sharing that information, I don’t want it to be stored in your system. I want to be able to pull my information back and I’ll update it when I feel like updating it but the idea that I’m going to be willing to give my information away for free and not benefit from it. There’s a saying in Silicon Valley that if you didn’t pay for the product, you are the product. And in the ad-based model that the internet currently operates on, I am the product. Getting me to look at more pages is the way that those companies make money. And I think that in the future, you’re going to see more and more people willing to pay for the resources that they’re using so that they can actually be in control of how their data is used and shared. And if it is monetized, they’re going to want to take a piece of that monetization.

Chris Blasinsky:
Yeah. That’s a good point. I mean, there are certainly some innovations that can come down the pipe that startled people. you know, Bitcoin is one of them. But, Bitcoin is not new to you. I saw the story about how you early on bought it and congratulations. But there’s some things that can come fast and furious and scare people. And then there’s some stuff that can come fast and furious and actually excite people and bring everybody into the fold. For people like you with startups and stuff like that, that’s a balance you got to strike, and I don’t know how you do it. So if you have any insider baseball on that, I mean, we’re all ears.

Andy Ellwood:
I think the important thing in testing is test, but verify. Try something, but set a hypothesis for what you’re actually testing it for. Don’t just try to jump on a bandwagon, because if you’re just jumping on a bandwagon because that’s what people are telling you to do, there’s not really a way to objectively understand if it worked or not. And so if you say, hey we’re going to spend…you know, our goal is to post – just keeping it easy with social media – one new image on Instagram a day. And the way that we’re going to know if it worked or not, is if we have three people a week, when they come into our store, say, “Hey, I love that Instagram post you posted.” And if nobody mentions it and it doesn’t drive any additional foot traffic, then why on Earth are we doing this?

Andy Ellwood:
Because it’s a very noisy crowded space. But if you could find a way to say, we’re willing to make this investment, the risk of making this investment, is worth the upside of this hypothesis. And if you..and I think that that’s one of the things that as leaders, I see a lot of people swing and miss on is they say, test something new, but they don’t ever set parameters for how we’ll know if it worked. They’re expecting it to revolutionize the whole business. No, no no. It’s, you test it, see if it’s worth doing more of, and if it’s worth doing more of then you set a new set of parameters for how you’ll know if it works or not. But I think that there are a lot of things that it’s still so early on that it’s really important to maybe understand or to think about, but to actually go whole hog and jump all the way in, there’ll be time for that. Unless you’re known as the company that gets there first, it’s okay to let other people test and learn, but be aware of what they’re testing is what they’re learning so that you can decide if that’s something that’s worthwhile for you.

Chris Blasinsky:
Yeah. Makes sense.

Britt Brewer:
Something tells me that you’ve had several ideas fail because you have to fail in order to get to where you are today. Is there any funny anecdote that you could share with us or an example of something that maybe didn’t take off so well?

Andy Ellwood:
Yeah. So I think that when I looked back at the handful of companies that I’ve been associated with that are definitely not on my LinkedIn profile, the thing that I think they’ve all had in common was they didn’t have a clear why they existed. It was…they could exist and so like, “hey, this could happen so we should do it.” And that was kind of like the end of the thinking through it, enough, people were like, that’d be cool. And, it just wasn’t ever really ratcheted in an understanding of who the end user was. I think the common thread was the people building it said, “this will be awesome.” They themselves were actually the only people in the world that thought it would be as awesome as it was.

Andy Ellwood:
They didn’t go ask questions of who they thought would be the end user. They didn’t sit down with people who were using it and say, “Hey, how can we make this better?” They just said…they tried to be a little bit too much of Steve Jobs. You know, somebody once said to Steve Jobs, how how did you know to build Macintosh computers? How did you know to build Apple? And he said, well, if I’d asked the consumer what they wanted, we would still have beige computers. But Steve Jobs gets to say that. You don’t. I think Henry Ford, you know with the Ford Model-T, you could have any color you want, as long as that color is black. The days of that type of ‘from the top down dictatorship leadership’, there are very few instances where that is still going to work. You know, there’s, the dogged determination of a founder and the dogged determination of a business owner that is absolutely necessary. They’re willing to go down with the ship because they have so much invested in the upside, but it…the idea that one person is just going to like wave a magic wand and say, this is what the world needs. And they’re going to just pull it out and not have a whole lot of input from a lot of other people. I don’t think that those days are in our future. I think that community-driven ideas, ideas that are…that touch all of the shareholders around the ideas from the partners to the clients, to the investors. {beeping and dog barking} Well, there’s my dog.

Andy Ellwood:
So I think that there’s going to be the future of companies is going to be built around all of the shareholders at the table, being able to have an input and actually taking their thoughts and their consideration. More and more, we’re having such individualized experiences that you have to talk to, with, a lot of individuals to really understand how it’s showing up for them in their organization or in their lives based on the type of product or services that you’re selling.

Chris Blasinsky:
I mean, it goes straight back to what you said about transparency and you know, in our industry too, I mean, you… retailers have the opportunity and the challenge of being everything to everyone, right? I mean, there’s 165 million transactions in our industry every single day. It’s a lot of people. So, yeah. So there is with the the spirit of collaboration, like you said, one person trying to do everything. I mean, it seems impossible. Absolutely seems impossible.

Andy Ellwood:
Yeah. And I think that ultimately when you think about the things that have been replaced by technology and the things that are continued to be replaced by technology, you have the opportunity to build in a personalized experience and something that technology is never going to replace. That it may enhance the way that you do it, but the ability to, compete with human talents that makes it a different experience. You know, that makes the top 1% of those 165 million transactions, just a little bit different and creates an opportunity for loyalty, for feeling like they’re a part of the ecosystem, for feeling that it’s more than just here’s the transaction. I think that’s really what I see is going to be a big opportunity, there’s going to be a renaissance of the shop owner, a renaissance of the store manager or renaissance of the clerks that know the customers, and that’s where the loyalty is going to come from.

Andy Ellwood:
It’s not going to come from having more selection because there’s so many people that have good selections. It’s not going to come from prices, the difference in prices on one or two items ultimately, it’s maybe not going to drive that. But if you remember, “hey so-and-so, he’s a great conversationalist, I’d love, love to swing by and check in, I know he’s going to ask me how I am, too.” That’s an opportunity that I think some people are going to be able to really take advantage of. But it’s going to require people to get off their phones when they’re behind the register and actually pay attention to who’s standing in front of them. And that’s a challenge that I throw out to my millennials and everybody who comes behind us, that doing a Tik Tok video while you’re behind the counter is not going to drive more traffic for your boss. And your boss is probably going to see it.

Chris Blasinsky:
Your boss is probably not going to be that happy either. Well, Andy it has been a pleasure talking to you. I’m glad we got a chance to connect and hear from you and if our audience wants to learn more about you or hear more from you, where can they find you?

Andy Ellwood:
Yeah, AndyEllwood.com is the hub…maybe the easiest way to do it, but I am lucky to also have Andy Ellwood on every platform. So Facebook, Twitter, LinkedIn, Instagram, and just about everything else. A-N-D-Y-E-L-L-W-O-O-D.

Britt Brewer:
Fantastic. Thank you so much, Andy, for all your insights and for joining us today.

Convenience Matters Outro:
[Music] Convenience Matters is brought to you by NACS and produced in partnership with Human Factor. For more information, visit convenience.org.