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If you are seeking new ways to increase your ROI on marketing with your commerce platform, or you may be an entrepreneur who wants to grow your team and be more efficient with your online business.
Talk Commerce with Brent W. Peterson draws stories from merchants, marketers, and entrepreneurs who share their experiences in the trenches to help you learn what works and what may not in your business.
Keep up with the current news on commerce platforms, marketing trends, and what is new in the entrepreneurial world. Episodes drop every Tuesday with the occasional bonus episodes.
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Brent Peterson (00:02.606)
Welcome to this episode of Talk Commerce. Today I have Jordy Vermeer from Channel Engine. He is the Vice President of Revenue for North America. Jordy, go ahead, introduce yourself. Tell us your day -to -day role. Maybe one of your passions in life.
Jordi Vermeer (00:19.166)
Hi, Brant. Thanks for having me. Yeah, I'm responsible for the commercials at Channel Engine here in North America. Yeah, I've basically three years ago started Channel Engine from scratch in this region, whereas we were already very established in Europe. And now we're seeing our largest growth is coming from and in this region, both with the customers that we get in North America, as well as with the European.
customer base that are migrating over and expanding into this region. One of my passions is obviously surfing. Did a trip to Puerto Rico the other week and it's really something I would love to do in my spare time.
Brent Peterson (01:04.814)
That's awesome. Where, in which part of Puerto Rico are you surfing in? Okay.
Jordi Vermeer (01:10.334)
in the recon west coast, but also here in Brooklyn, I regularly surf, so cold water.
Brent Peterson (01:15.278)
Nice, good, all right. Okay, so before we get started on content, you did volunteer to be part of the free joke project, or maybe it was voluntold, one of the two. All I'm gonna do is tell you a joke and you just have to say, should this joke be free or do you think someday somebody should pay for it? And as a caveat, today I'm using an API to get my dad jokes. So I'm gonna hit go, got a Python script that I wrote and I'm gonna go out and get a joke and bring it back. So here we go.
It's gonna be a great one. What you would call a pencil with two erasers? pointless
Jordi Vermeer (01:54.494)
I'm curious if this should be a free joke or if it should be paid for. I'm curious how you automate this though.
Brent Peterson (01:58.22)
No, it's...
Yeah, I don't know, but it's automated. But let's try one more because that wasn't super funny. Actually, none of them are going to be funny. Here we go. I just paid $100 for a belt that doesn't fit. What a huge waste.
We better stop now. Yeah, exactly. Yeah, yeah. We'll go Dutch on this one. How's that? We'll each pay for a little bit of it. All right. So, Jordy, why don't you tell us a little bit about Channel Engine? Tell us a little bit about what it does and how it benefits merchants.
Jordi Vermeer (02:17.79)
Should this be free or should it be paid for? I don't know.
Jordi Vermeer (02:26.334)
That's a good one for me.
Jordi Vermeer (02:44.402)
So channel engine is a technology developed around 10 years. We're in the market right now. We, we focus predominantly on third party marketplaces to help brands and resellers to list, optimize, and manage their marketplace sales. So you could think about product listings, managing your pricing, making sure that your inventory is allocated and distributed correctly orders.
shipments, returns, the full end -to -end automation to make sure you can sell in these third party marketplaces. And one of the things that we've seen, especially during COVID, is that there was a big trend going on that these platforms kind of blew up. And that has been part of our foundational success because we've been facilitating these platforms also to grow.
Now we have 700 global marketplaces integrated. It's quite challenging to manage and maintain it. Luckily, we do it for about 800 customers today. And that helps us to aggregate all the effort into doing this and keep optimizing and giving more tools for our customers to keep optimizing their marketplace sales.
Brent Peterson (04:06.51)
So just so we can maybe help a merchant understand the importance of this, if I'm selling something in Brooklyn and I want to try to get into a bigger area or even go across the world and I have a website, tell us about how Channel Engine would help that merchant to grow their business.
Jordi Vermeer (04:31.934)
Yeah, so we work with different type of customers, larger or smaller, a brand that is, you're saying is, let's say growing or in its growth phase. We typically connect through their backend system, which often is an e -commerce platform where we have a plugin with, so let's say Shopify. We take all the product data and in channels you can select which channels you would like to sell it towards. Some of these platforms are pretty known, so like a Walmart or Amazon.
eBay and there's a little bit more niche marketplaces as well that sometimes have a better fit. It's pretty straightforward to do this on a local basis. So in the US you can expand and make sure you can do your sales on Amazon Walmart, etc. If you want to go to other regions, there are some product compliances and other regulations fulfillment you have to go through. But then also you can make use of the local network of those marketplaces.
and the local traffic that they have and like that you can expand your brand into also other regions.
Brent Peterson (05:37.134)
So one of the biggest ones out there or the biggest one is Amazon, right? So how does Channel Engine interact with Amazon?
Jordi Vermeer (05:46.43)
So we have an API -based integration where we can basically plug into the backend of Amazon. It's very important to understand we know the product hierarchies and structures and also requirements for the content. So we load all those requirements into Channel Engine when someone tries to publish their products.
Channel engine knows those restrictions and make sure that you have tools to manipulate your data in order to make sure it fits that marketplace and also the categories and the country that you're selling it into. That makes it very easy to not have to recreate content, upload a feed and do a lot of manual work with trying to maintain your content and uploading new products. It is a semi -automated process as well as making sure that then all your orders come in and we can directly push them.
back to that Shopify platform, for example, to make sure that the fulfillment is done by our existing warehouse or 3PL solution.
Brent Peterson (06:49.966)
So like if I'm a hybrid seller, how does that help me as a merchant by selling on Amazon and using your system?
Jordi Vermeer (07:00.99)
Yeah. So what's good to understand is you have Amazon one P or the vendor model and you have Amazon seller, the three P model. Uh, so what I've said so far is mostly the three P model where you sell on Amazon or the seller record and you determine everything, how it's sold, for what price you get the, uh, the order and you fulfill it. Now there's also something which is a little bit more, uh, that was there before. Uh, so how, how a regular retailer works.
is the vendor model where you sell it to Amazon and Amazon is going to sell it for you. Now in that model, Amazon has also launched the similar API features that they saw to be very successful in the marketplace model. They expanded that to the vendor model. So that's also something we launched in the past months. So we have a way to also optimize, manage and very easily distribute your product content.
onto Amazon vendor, which is usually a very big challenge. Again, a lot of manual work. You don't know the restrictions. You get the error codes in a file that you don't understand. And that process is also partially automated by channel engines capabilities and APIs. Hybrid selling is then the combination. And this is one of the biggest trends that we're currently seeing in the market. Actually, in the past two years, it grew to
70 % of the brands actually selling hybrid. So both 1P and 3P. The advantage to this is that it gives brands more control of selling certain products to Amazon because the vendor manager and the deals that went well, for the P &L, it makes sense to have it sold by Amazon. Some products, it doesn't fit that bucket.
It doesn't fit the pricing. It doesn't fit the negotiations. It's, you know, or, or it's simply like overstock that you have and you want to sell it somehow. Anyway, you can sell it 3P as well as new products. You could test a 3P or when Amazon didn't want to buy or, you know, stock up enough, you could be the, uh, the fallback, right? If Amazon gets out of stock, you could still ship it from your own warehouse. Um, so that's a little bit of.
Jordi Vermeer (09:24.222)
and around hybrid setting.
Brent Peterson (09:26.958)
I think the market is becoming or is very competitive and there's been other systems that help clients get their products into channels. What distinguishes Channel Engine from some of the competitors?
Jordi Vermeer (09:45.566)
Most of our competitors, I don't always see them as competitors because they usually do it as a service. So it is people that are manipulating feeds or recreating templates, usually in PIMS, which still costs a lot of manual labor. What we aim to do is automate it. So we set up rules in our backend that if something
from the brand is a certain way, then you confirm it or manipulate it to make it fit to Amazon's way. That automation is usually perceived as one of the biggest benefits together with the UI UX, where we try to create a platform that can be used and should be used by the brand itself and giving control in their hands as opposed to a more complicated or not even able to use platform.
And typically, the last thing we distinguish ourselves in is our support. We're still a mid -sized company that we know our customers. And for the ones that have issues, we very quickly can escalate and can jump in and make sure that they are supported really well.
Brent Peterson (10:57.678)
I know that we were talking about Amazon earlier. Do you plan or does Channel Engine plan on having retail as part of that, as part of the mix?
Jordi Vermeer (11:13.63)
That's a good question. More and more. Yes. So our core has always been marketplaces. So the third party sales channels, the further we see those retailers develop their technology, the more we also see that we should be close to it. Also the further we develop our technology, it gets closer to that space. So for instance, we're launching a feed manager.
where you can manipulate your feeds in any way you would like. So even if it's a very traditional platform or place you would like to sell, you can still confirm your feed with those tools we use for those other channels. You can also confirm it in a way to make sure it fits whatever location you would like to sell that and send that feed to. So long story short, yes, we're getting towards that space.
Brent Peterson (12:06.574)
Is there a downside? No. Is there a downside for a merchant to want to get as many channels as possible for their products?
Jordi Vermeer (12:19.806)
Yeah, that has a lot to do with strategy. So what is the reason why you're doing marketplaces? That could be as simple as I want to grow my revenue, but it could also be I'm trying to expand my brand presence or improve my profits. Those are three different ways to tackle the market. So and each reason has a.
you know, also different approach. And that is something that you have to take into account with your marketplace strategy. And, and often it might sound weird from, from a company that wants to do as many channels as possible. Also, we do recommend to not publish all your products on all marketplaces you can get your hands on, uh, because that could also, uh, it could be hurtful for your profit or it could cannibalize your .com sales.
So it's all about like, what would you like to do? Would you like to start expanding to Europe? Then yeah, there's a good way to do that. Whereas if you want to optimize your profits, then maybe switching from one P to three P on Amazon could be beneficial because you have higher or lower costs or you pay to Amazon. So it's all about the strategy.
Brent Peterson (13:37.774)
You had mentioned workflows and automations. Is there efficiencies that customers see? Like they're just going to Amazon in terms of how they get their product out, their logistics, things like that, that Channel Legion offers?
Jordi Vermeer (13:56.318)
Yeah, it's, it's, it's a lot around that in basically managing your product catalog in bulk. Usually you go in a product one by one. Think about you want to do a price change to all your products in a certain category because your margins aren't where they are, where they need to be. That could be a lot of work where you either manually upload a feed or you go into Amazon and change all of it.
You can set promotions from or to a certain time that is also very cumbersome to do it in the backend of Amazon. So this is just pricing, right? Think about also optimizing your content, adding more to it. And then also the whole part about reporting and analytics and knowing what's happening. We also have buy books data where you can see other companies are trying to sell your products or trying to sell the same products that you are selling. All this data.
and all these automations are going to optimize it in the long run. One of the biggest things we launched is to create virtual bundles. And now you can create it with AI, where you can recreate two products to become one. And this has been a tremendous positive impact for our customers to increase their average order value. And yeah, that's, of course, really important for a lot of customers because it also improves profit.
Brent Peterson (15:24.942)
Is there an ideal client that works well with you? Is there a threshold in terms of sales or volume that seems to make sense?
Jordi Vermeer (15:35.378)
Often we do see like we're working with companies that are that are somewhat established. So usually it's companies that do a total revenue of more than 10 million or at least the marketplace revenue that do at least one million or companies that are trending towards that. Right. But it's companies that have either already established somewhat or are growing really fast and are
are willing to invest. Mostly this because our platform is more advanced than others. So you do, there is a lot of tools and you can optimize your sales a lot and you can go to a lot of channels. But it is an investment to make sure you do that, right? So that's why there's usually a minimum threshold. We have not seen a maximum threshold. We work with the largest companies in the world. We have multiple Fortune 500 companies that we currently work with.
to do this.
Brent Peterson (16:36.974)
Um, we, we, we, we haven't talked much about social commerce. I know that, uh, Shopify lets you check out on Facebook or whatever. Like there's so much, so much happening in the, in the, in the, in the social media world where the, in the brands, the Tik TOK and these, the platforms are becoming sort of pseudo commerce engines. How is, um, channel agent tackling that?
Jordi Vermeer (17:06.014)
Yeah, we actually see these platforms also becoming marketplaces. So one of the trends we saw in the past years is these retailers like Macy's, Belk, Best Buy, the Bay. They all became marketplaces because they saw like, hey, we can, we can very simply get a cut of stuff that we're selling without having to actually do the work that much, right? Cause it's people that buy stuff on our platform and we get a
15, 20 % of it. Social commerce platforms are seeing the same thing and they are jumping on the same train. So TikTok last year or 2022, I believe they launched their social commerce, which means or TikTok shop it's called, where you can purchase the products that are promoted on TikTok. You can now directly purchase it on TikTok. They doubled down on it where they actually deprecated some integrations.
that you are not able to get that purchase towards your Shopify or towards Amazon. Like they deprecated those integrations to stimulate purchases on their platform. And now Meta, they're slightly after the fact, but they also launched their Meta shopping late last year. And this year they're also going to double down on it. I don't know if they also will are looking to deprecate those kinds of integrations with Shopify, but.
It is of course a trend that they're all trying to maximize the revenue or the purchases that go through that platform. Think even about the payments, right? Everyone gets a cut of every payment and those cuts are pretty severe. So I think everyone wants to have their transactions on their platform.
Brent Peterson (18:52.174)
How about if we look at just, if I'm a merchant, I'm selling in Midwest or the middle of the US and I want to get into Mexico, how does it look now for people that want to grow outside their country they're in? Not just outside their local region, but outside of the country.
Jordi Vermeer (19:15.134)
Yeah, so in the country, it's pretty straightforward. It's just fulfillment that you need to do well or set up the shipping templates correctly. Then if you look at, let's say, we call it, there's something called cross border. It happens in Europe a lot and here a little bit. So think about, you know, Canada is usually a good first market to go to because it's very similar target audience for the products that are sold in the US.
Those marketplaces that you can go on, Best Buy, Walmart, eBay, Amazon, of course, the Bay, Reitman, there's a decent amount of channels in Canada. You can actually sell on those platforms with your US entity, ship it to Canada, as long as you have some form of return address or location or partner in Canada.
So we also work with some of those partners to make sure our US customers can ship it to Canada, whilst the return location is also in Canada because that's one of the requirements of those marketplaces.
Brent Peterson (20:22.638)
Are you seeing opportunities for vendors in Mexico to sell directly to the US and Canada?
Jordi Vermeer (20:30.366)
So with Mexico, we are seeing some larger brands, especially in consumer electronics that are evaluating the Mexican market because the quality of the products is sometimes a problem with local products there. You have the largest platform is actually Mercado Libre in Mexico. So people can sell to there and they have a cross border program as well. So similar to Canada, actually Mercado Libre, they have a
whole program for it that they handle everything that we do also work with. And Walmart is there also. And Amazon, of course, is there also. So those are the top three, I would say, in Mexico. From Mexico to the US, honestly, I haven't seen that too much yet. Yeah, I'm not sure the reason. I'm sure there are companies that do that or want that. But usually, when it happens,
When that happens, they use a local distributor. That's also historically, like people sell in Mexico through local distributors and that local distributor has a contract. They can, or a license and they can sell everything, right? So that's a traditional model that now some larger companies are trying to go around or work with to not have to give both the distributor, the wholesaler, the retailer, the marketplace, everyone gets a cut. And then at the end of the line, the brand doesn't get it.
or doesn't get enough profits, right?
Brent Peterson (22:00.238)
Do you think that this is going to accelerate now as we go into the rest of 2024 and 2025? What are your predictions coming up now for e -commerce and multi -channel selling?
Jordi Vermeer (22:18.302)
We see the economy very related to e -commerce, obviously. And it has a lot to do with purchase power. People buy a lot, or they're more consuming if it goes well with the economy or with their finances. And that has been a bit of a challenge in the past year. So the
You know, the brand stopped. A lot of people were continuing to buy a lot. There was a supply chain issue in I think 2022. So we call it that was under stock. And then last year, 2023, there was a lot of overstock. So people had too many products or brands had them, right? That's why you'll see a lot of discounted things right now. Personally, I see that later in 2024, early 2025, the economy will make some positive strides.
And I do think that that is going to work in the favor of these online retailers or online platforms or online sales.
Brent Peterson (23:25.454)
I see Channel Engine at all the conferences and you guys always have the great tins of Stroop Waffles. Is there a good vendor for Stroop Waffles in the US that we can, we don't have to go to a conference to go to your table or your booth and get a tin of Stroop Waffles?
Jordi Vermeer (23:44.446)
Honestly, I did my research. We tried to buy them in the US and it did not work out. We did not get the quality that we wanted. So we import them from the Netherlands. I believe there are importers. There's websites you can buy Dutch products in the US. You'd have to buy them in bulk, but probably the easiest is to come to our booth at one of the conferences.
Brent Peterson (24:07.822)
Why do you think that there's so many, there's more than one competitor coming out of the Netherlands for this type of business? Is it just because the Netherlands is kind of central to Europe and you're a hub for commerce and Channel Engine is just a natural outlet of what the Dutch are already doing in terms of commerce?
Jordi Vermeer (24:34.942)
So I think it's a few things. One is the Dutch historically have always been pioneers. It's also in the, if you look at tech innovation, the Netherlands is basically set as the most advantageous place for startups to develop. So there's a lot of government stimulation or a lot of environment. There's a really good technical university where also our founder and CO is from.
So it's, it's, it's a really a startup scale up tech culture that hasn't happens a lot in the Netherlands. So that's one. Secondly, e -commerce in the Netherlands is very, very far developed. And that, yeah, that's, that's just, it's also a smaller country, right? So it's easier to just purchase products. You can ship it everywhere. It's also a hub for like for logistics very often. So the Netherlands is.
often used as a logistical hub for the rest of Europe because of the big port in Rotterdam. And lastly, we have, you can also see that in, we actually have a Dutch type of Amazon, which is called bull .com. And bull .com is a platform that currently is still larger than Amazon in the Netherlands specifically. So you see that that diversity that also was needed, it was needed that platforms like us started because otherwise you
you couldn't sell on these kind of platforms or multiple platforms at the same time. I hope that makes sense.
Brent Peterson (26:07.628)
That's great. Thank you. So Jordy, as we close out the podcast, I give our guests a chance to do a shameless plug about anything you want. You can promote anything you'd like. What would you like to plug today?
Jordi Vermeer (26:19.518)
Oh, that was unexpected. I think, yeah, in general, I like working with some of the Marketplace teams. So I would almost give a shout out to the Macy's team. Some Marketplaces are tougher to work with, and some are very fun and good to work with. And teams like the Macy's team are really good. But of course, there's a lot more of these teams that
that support us really well and in return we can help our customers to go live quickly on these marketplaces. So these are some exciting things.
Brent Peterson (26:59.128)
That's awesome. Thank you so much. Jody Vermeer, no relation to the painter or there may be a relation to the painter. That'll be in the next episode. It's been great to have you on the show today. You're the vice president of revenue for North America for Channel Engine. Thank you so much.
Jordi Vermeer (27:17.542)
Thank you, Brent.