Leader Spotlight: Evaluating build, buy, or ally decisions, with Brad Power

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Brad Power is Senior Director Digital Product & User Experience at Kendra Scott, a woman-founded, Austin-based jewelry company with 150 retail stores across North America. He kickstarted his ecommerce career when he joined Whole Foods Market working in supply chain systems. From there, Brad served as Director of Web & Ecommerce and, later, Senior Director of Technology. Prior to joining Kendra Scott, he held leadership positions at Orvis and McLane Company.

In our conversation, Brad talks about key factors when pursuing a build, buy, or ally strategy, such as evaluating the product roadmap, tech heaviness, and financial stability. He also discusses the process of turning an aha moment that surfaces from a customer interaction into a substantial product change.

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The importance of regular customer signals

You have quite an extensive history in retail and also B2C. What is your overall approach to aligning strategic initiatives with evolving customer needs in the retail or B2C space?

It’s important to have multiple and regular customer signals. This could be as simple as going into the store and talking to customers, or as in-depth as post-purchase or post-store visit email surveys. It’s crucial to mine the data in your social and customer care channels, as well as look at NPS or CSAT data whenever you can.

The second component is having a regular benchmarking exercise. This is when you compare yourself to your competitors and understand where you differentiate now, as well as how you want to differentiate in the future. You should also look at the share of wallet among your competitors for additional context. The goal is to take advantage of as many of those signals as you can.

You mentioned getting customer signals by speaking with them or visiting stores. Do you find there’s a specific cadence that’s best, or does it depend?

It depends on your maturity, the size of your team, and your bandwidth to do analysis regularly. Some groups can get into it more frequently, but the channel itself may vary a lot, too. You could pull data out of Meta or TikTok on an hourly basis, but that may not be as realistic as visiting a store, for example, to run a CSAT survey. It may be a little bit of what you can do from the labor and capacity standpoint of your team, as well as the channel and signals you’re going to get out of doing it more often.

Choosing to either partner or build from scratch

While you were at Whole Foods Market, you leveraged customer insights and data analysis to launch Prime Now delivery. What was that process like, and what factors contributed to the success of that program?

We noticed a rise in delivery overall. Uber and DoorDash had entered the market, and it wasn’t a big jump for us, considering we already had prepared food items in the grocery store. We saw it as an opportunity to sell more prepared food because consumers were showing demand but wanted it to be more convenient.

We also got that feedback in our store exit polls and other interactions we had with customers — they were interested in the time savings associated with having their items be ready for pickup or delivered to their home. We also got a sense for the price point that they were willing to pay.

The other aspect was thinking about how to engage with an initiative like this. We had to evaluate our technical maturity and the maturity of this feature. When we got into it, it was important to see all the players out there. Something we did successfully was look at three or four different providers based on their ability to deliver in the markets where we competed. Not every delivery company started out serving the entire United States, but smaller geographic segments. That helped us leverage multiple partners to give our customers coverage but also to diversify our risk.

We also thought about the build, buy, or ally strategy. We asked, “Are we really technical-heavy, and is technology a key differentiator for us?” While we thought we had great technology, building a routing, mapping, and order-taking service was a lot, so we decided to partner so we could enter the market faster. We did this with three or four different companies and underwent a selection process to narrow it down.

Overall, like most experiments, we had to represent the different interested functional areas, such as marketing, technology, and operations. We wanted them all to weigh in. Those are some of the factors that went into our decision and are likely common for other businesses when they want to make a big decision in a new technical area like this.

When you were talking about build, buy, or ally decisions, you mentioned how and why you decided to partner. What other considerations do you think about?

It’s good to consider aspects of the partner, such as their financial status. Is their product roadmap closely aligned with your strategy? If you’re in a good financial situation, are they willing to let you put some money on the table so that you’re co-invested together? That can help with your ability to influence the roadmap, and if they’re successful, you can get some sort of return on investment.

One thing that’s not as easy to put a metric on is how well you work with their team. Like any relationship or partnership, no matter how cool the technology is, there are people behind it — you have to be able to work with those people through good times and bad.

What about when you’re working with your team internally? Does that build, buy, or ally decision impact your team’s ability to innovate?

It certainly can, and this probably has to do a bit with the scale of the company, its size, and the business or vertical. At Kendra Scott, we’re in the jewelry business, so we want our jewelry and customer interactions to be key differentiators. However, if I worked in B2B, my technology would be the differentiator, so I’d likely be more willing to invest in new tech instead of a store experience. What is your company doing that aligns with its strategy, that in turn relates to your budget for investing? I wouldn’t say that it limits imagination or creativity, but it determines how you’re going to realize that.

Whatever the idea is, you’re going to need to realize it with a partner who already has strength in that space and would ideally be one of your existing partners. We all want to decrease technical complexity. How do you look at your current partners and their roadmaps and bring customer problems to them that you both want to solve? It comes back to something mutually beneficial, which is a great thing. These parameters don’t necessarily limit where you can go but will just determine how you need to accomplish it and who you need to work with.

Turning aha moments into scalable products

Everyone right now, regardless of vertical, is figuring out how to take advantage of AI. What are some criteria you’ve used to evaluate AI tools?

Some of the considerations we’ve already talked about are if you know this potential partner is strong. What is their track record? Do they have customer references? Is AI in their DNA, or are they just offering it because it’s the current buzzword? Understand their roadmap and their commitment to invest and grow it.

In the AI space specifically, it’s good to think about the models they get their learnings from. Are they building on top of OpenAI, or is it their own custom AI system? If they’re building it on top of somebody else’s product, they’re not in complete control over product direction. That makes one more partner for you to consider. If the underlying service goes out of business, they need to have a plan.

The third thing that’s unique to AI is how the model learns. I’ve read recent use cases where people have implemented chatbots, only to realize that, in addition to the brand talking points, they were feeding the agent, the agent was also learning from another platform and exposing things to their customers that did not align with their brand.

You’ve given a couple of examples of the build, buy, or ally decision where you were buying. Do you have an example where you went with the build option?

Sometimes, it’s part of the relationship. At Whole Foods, to make some of the parts of the delivery service work, we had to build capabilities that gave the partner all the product data — they couldn’t just make up the products that we have in our stores and their prices. Creating some integrations are a common example of build decisions that I’ve led..

At Kendra Scott, we built a patented product called the Color Bar. Guests can use this product online or in-store to customize their jewelry. They can choose the stone color and the settings based on the piece of jewelry they select. This was an idea that came from customer interactions. We were physically bending the prongs back of some jewels to replace stones, and we were like, “This is something that’s going to catch on. We should figure out a way to build on this relationship that we already have with the client and be able to scale it.”

This was specifically an aha moment that turned into a great personalized experience. We were able to figure out how to build and scale it in our store and online.

How do you surface those aha moments that become legitimate product ideas?

I find that the only way to really do this is to build relationships with customers and be in the store. This specifically applies to omnichannel roles where you’re not heads-down in one particular channel. You can’t rely on the fact that a retail store team member, whose primary job is to service customers in the stores, is going to remember to send you an email every time there’s a good idea. It is going to happen, but I think that you have to be able to find time, go to store openings, and visit stores, even if it’s just dropping in to say hi.

When you build the network up, you may have an opportunity to email leaders or schedule some one-off time with them for an ideation session. But, if you’re in a digital space and you don’t already have some way of thinking about omnichannel, that’s an opportunity you‘re missing — that cross-pollination of ideas to share as much as you’re receiving. It’s great to have a retail person sit down and help you think through how new features may impact their store in a way that you might not have thought. I’d recommend doing that quarterly to start.

Beyond that, ideally, you’ll arrive at a shared goal with the leaders or employees you’re talking to. Easy ones that come to mind are customer lifetime value or repeat customers. You and the person you’re talking with will both understand how you’re contributing to something that’s powerfully driving the company. And each channel has a part in that.

One of the truisms we always try to talk about at Kendra Scott is that customers want when they want, how they want it, and where they want it. That’s what you need to be thinking about. Sometimes, it may not even be your own channel. When we think about Amazon, roughly 85 percent of Americans are Amazon customers. Clearly, that’s a place where people want to do business, so how do your ideas then fit in your overall customer journey?

Build, buy, or ally initiatives or decisions often result in change. How do you work to overcome any resistance to that with internal teams?

I believe in transparency. If you’re a heavy tech company and you want to place a bet with partner A or partner B, you need to sit down with your team and explain, “It’s not that we don’t trust you. And it’s not because we don’t think you’re fantastic technologists. We want to make a bet, and we want speed to market, and the right way to do that for our company is to partner with this other company. You’ll have the opportunity to be part of it. You’re going to build the integrations. There’ll be cross-company networking opportunities where you can learn from each other.”

If you’re part of a culture that’s used to moving slowly and where dealing with ambiguity isn’t easy, then you probably need to give yourself more time to effectively communicate changes like that. You need to think through how working with a partner will impact the team’s morale. How does the partner mesh with or potentially conflict with your current culture?

Every company goes through pivots or evolutions in their life cycles, but it’s important to make things as transparent as possible. This can come down to the individual team member, where you say, “This is a change we’re making. We want you to be a part of that, so we’re going to give you six months to learn the new technology. We want to invest in you. If you’re not invested because you really want to keep doing the thing you were doing before, we’re also going to give you six months to figure out what’s next for you.”

Talking through that strategy helps people understand how your company’s future fits into their life and their role. We all process information differently — some people will sit in the meeting and nod for you, but then they need a week to digest it afterward. The magnitude of the change should determine how long you give people to think things through and decide what’s best for them.