E-Commerce Speaks - Episode 7: Present and Future Retail Strategy - with Hitesh Malhotra

The Importance of Collaboration - Short Summary

In this episode of E-Commerce Speaks, we speak with Hitesh Malhotra, Head of Marketing for the brand 6thStreet, which is part of Apparel Group. The episode covers his day to day work for the retailer, the importance of identifying what matters to different generations of customers, and why collaboration between departments is a must.

We also discuss:

• How affiliate and partner marketing are a massive part of retail marketing strategy in the Gulf Cooperation Council (GCC) region.
• The growth vs sustainability mindset, and how it applies to different 10-15 year tech cycles (dot com era, e-commerce, AI)
• “Getting your hands dirty” when in a senior role to ensure you understand how your team operates
  
  

…and more!

Transcript of the episode

SAM
Hello, everybody, and welcome to another episode of E-Commerce Speaks - with ROI Hunter. Today I have the pleasure of hosting Hitesh Malhotra, Head of Marketing at 6thStreet, which is part of Apparel Group. 

Hitesh, thank you so much for being here with us today.

HITESH
Thank you. Pleasure's all mine. I hope you're having a good weekend.

SAM
I'm having a good start of the week. And yeah, we're about to get into that.
Yeah. Nice. You know, I just to get started. Could you tell me a little bit more about yourself, your company, and what you do there?

HITESH
Yeah. I've been a marketer for now nearly 18 years of my life, largely in fast-moving omnichannel retail ranging from MakeMyTrip, which was into travel, then to Nykaa, which was into beauty, which is- which had a splendid IPO. Lenskart which was more into opticals, then I had-

I had links with a company called Oasis, which is into Web3 crypto trading, and now I am with 6thStreet, which is basically an omnichannel retail, primarily online under Apparel Group where we sell fashion everything from bags to shoes to sneakers to clothes.

One of the dominant players in the region. And we have footprint across UAE, Saudi, GCC, and and it's great to be under the Apparel umbrella.

SAM
And in your in your role there as Head of Marketing, what are some of the things that you're responsible for? Like if you could just walk us through a day in the office.

HITESH
So, you know, I wear multiple hats. Usually I like to control both the left and right brain functions of the marketing. So I take care of performance, I take care of brand. I take care of creative, which is now integrated into marketing; it used to be a separate team. I take care of CRM, which is responsible for customer retention and loyalty. And last but not the least, I take care of affiliates and influencers, which is the heart and soul of GCC.

SAM
Oh, yeah. 

HITESH
So that's multiple hats within marketing, primarily led by performance in digital, and influencers and affiliates. But yes, multiple roles.

SAM
Yeah, that is a lot of different hats. That's a bunch of different areas to take care of. So yeah, so you said performance and then influencer marketing are the big ones for you guys over there right now.

HITESH
They are the biggest for the region, right? So how the region operates is that typically most of the retailers that I do fashion, beauty or any any form of fast-moving goods would usually have anything between 25 to 40%. 

Business coming in from affiliate and influencers plays a massive, massive part in this part of the world and then followed by the traditional performance marketing channels. So, you know, Meta, Google, TikTok, Snap, and then followed by the CRM, which is the inbound marketing retention that is largely driven by data science and customer lifetime value and passing different promotions based on the lifetime value to retain them.

SAM
Sure. I you know, I know one of my biggest challenges with marketing is attributing success for all the different things we do. I'm curious with with influencer marketing, how are you guys measuring the success of those kinds of programs?

HITESH
Fortunately, in this part of the world, the influencer marketing has a slightly similar affiliate kind of model where you allocate certain coupon codes and basically the coupon code redemption. You, you, you know, you generate invoices and you pay them on net that is net of returns.

It doesn't work across northern regions because a lot of influencers don't want to get into cross-promoter marketing. They prefer that you partner for content and there's not too much of an accountability in terms of order. But the way to set up all year is that it works like an affiliate stream where we kind of do both. 

The heart and soul obviously is the cross-promoter marketing, which is in line with affiliate. But on top of that, we do work with influencers on the content partnerships with the collaboration on reels, with the collaboration TikTok, where we post together, we give it a boost through different kind of ad formats and we also partner with giveaways and unboxing videos.

So it's a mixed bag, but essentially the relationship is based more like an affiliate stream and then there is plus plus on top of it. So I think we we're lucky a lot of people are not able to establish those kind of ground rules with majority of the influencers.

So I think that baseline kind of really helps us to develop relationships further. As our business grows, the influencers obviously want to make more money. They can pass on more orders. So we've kind of grown together in this ecosystem and by the virtue of that,  we do get access to some outstanding content and video creation by some of these very big influencers in the region. 

SAM
That's really interesting to learn. Yeah, that there's so much cohesion there between joining the influencers and the affiliate marketing, sounds like a lot of crossover.

HITESH
Yeah.

SAM
Speaking of crossover, one thing I was  wondering is, as Head of Marketing is how much collaboration you tend to have with other departments in the company- like merchandizing, or other commercial departments?

HITESH
You know, merchandizing team and data team, product marketing team. We are literally like brothers in arms because it's impossible to operate solo without, you know, not being on the net for like maybe 6 hours, 8 hours a day out of the entire 19 hours you have at work, because any one wheel of the car drops off, the whole car will kind of come into full stoppage, right?

So these wheels of merchandizing, commercials, which kind of goes along with merchandizing, data and technology and marketing, they have to work like a four wheel drive car. 

Just to give you an example, if the products are not there, the merchandizing team has not got the right brands in. No matter whatever traffic you get, you're not getting conversion. If the commercials are doing the pricing is not right or the sizes are not available, you don't get conversion. If they have all the right prices, if they have all the right brands, if the traffic is not there. Again, you know, you don't get the business.

And the fourth and last part is that if the pages are not loading well, if the codes are not working, fine, if there is any drop off in terms of even an in-app event, then obviously the technology team is not able to help. And again, the car comes to a full stoppage.

So I think on a daily basis, the amount of collaboration needed between these departments to make the car run is like extremely important. I think nine out of ten organizations in omnichannel retail who do not survive is because maybe the Heads don't get along. Or the Heads get along but the Middle Management doesn't get along. 

In our case, you know, as we joke amongst ourselves that we'd be happy if the Middle Management gets along and they bash us in the conversation and gossips, because that means that they're getting together and they're kind of working together, right?

So we need to encourage that. Yeah. Yeah. I mean, it’s fine: if they come together and they’re against us, that's fine. We need to get stuff done. But I think this collaboration is extremely important. Like four wheels of a car. 

SAM
Yeah, honestly, I think that's a correct and refreshing attitude toward collaboration because I think so many companies suffer when they when they operate in these different silos where the teams kind of do their own thing and kind of a little bit, communication. 

HITESH
Yeah.

SAM
How were you able to to foster that sort of collaboration so closely? Is it like a regular daily meeting or what sort of strategies do you use?

HITESH
So the best thing is we have not formalized a meeting system. We kind of keep, I would say, walking around and catching each other up at every nook and corner of the office to ensure that our work is done so that we don't really have to formalize meetings together with each other. 

That's a good part. You know, it's like a small family. It's not a very big workplace.

The size is nominal. So we can catch hold of each other either at the pantry or in one of the meeting rooms and just get the stuff done. 

I think that's one part. And the other part is we don't let the ego come into picture, right? So, so many times you would see, you know, that there are, you know, a lot of conflicts there, there are differences of ideas there. You know, there are a lot of different tantrums and different temperaments. 

In the end, everybody wants to achieve, you know, good revenue. Everybody wants to achieve great customer experience. So as long as we understand that all of us are working towards one goal, no matter the path to that goal could be different. It helps us cut down the ego.

Otherwise, in earlier part of my career, maybe when I was in late twenties, early thirties, I would usually get a little stuck up with, you know, things not going by me in a large, you know, management meeting. But right now I'm used to this fact that you win some, you lose some. In the end, the organization should do well. Right?

A lot of decisions that can go your way or maybe they won't go your way. But if something is being taken in unison, it needs to be supported, whether I like it or not. If there is, you know, a thumbs up from my side, irrespective personally if I like the decision or not, I will go full swing supporting it.

And I think it's a similar setup. It's a similar attitude from the other leaders as well. That really matters. Fortunately, we are in a set up where we are all similar age group, similar life stage, and we don't let this ego part come into picture. That's I think, most important.

SAM
So putting the putting the decisions, putting the company first, letting personal egos take a backseat.

HITESH
Yeah, yeah.

SAM
You know Hitesh, one thing that I've really been interested in talking with all of our guests about is how they like to stay informed on the industry. Because I know in the past it was a lot of articles, ebooks. Now people are gravitating more toward LinkedIn, podcasts.... How do you like to stay up to date on everything that's happening?

HITESH
You know, if you really want to be successful, you've got to become a little bit nerd and work like Elon Musk, right? That is, in today's world, the best way to be successful and stay successful. That means you need to get your hands dirty and and don't let that... that nerd in you die, who started career figuring out things when things were not going their way. Right?

So if I see articles 15, 20 years back, things were not easy because there was a transition that was happening from traditional businesses to more, I would say, digital-led businesses or technology-led businesses. And those are the years when we struggled our way out to understand and learn the new sciences and get used to it and then maybe mentor and train others.

The role pretty much remains the same to me, right? So the passion that I had maybe 18 or 20 years back to learn the new modules that have come, say in Google marketing or Facebook marketing, having to set it up myself and check it out, talk about it, excitedly to my friends and to my family and you know what, today this feature is launched, and I opened the dashboard.

I tried running one of the campaigns on my own. I did the set up. It was very exciting. I think that kind of keeps the fire burning. No amount of podcasts or books or any, you know, subscriptions can actually get you closer to that experience. You have to do it yourself. 

Same with generative AI, right? If I am not excited about putting the prompts in on GPT stores to get different experiments done, then there's no way I can talk about it. I shouldn't be talking about it. 

And this is my personal inspiration from, I would say, somebody like an Elon Musk that, you know, he's sitting on top of the world, but the passion that he carries towards it, rocket engine or towards that, you know, the Tesla autonomous drive, is so personal that you almost feel that you are talking to an employee first rather than, you know, the promoter or the founder of the company.

And I think that's the spirit we all need to keep. Right? We should not take our positions, our salaries, designations seriously. I don't think so. 

SAM
Sure. So so you really you're saying just when you're trying to learn about something else, you'll go in, get your hands dirty. If you're trying to figure out what the newest thing is with Google Performance Max or ASC+. 

SABIR
Yeah.

SAM
You're going to go in, set the campaigns up yourself, figure out the nitty gritty, rather than just reading about it or hearing about it from somebody else.

HITESH
Otherwise you kind of become the joke of the town because your team members would know that you're not hands-on.

SAM
Yeah.

HITESH
So either either they would be able to get away with something, which is not 100% optimum, or they would probably have the inside jokes that, you know, this guy doesn't understand- he has just been reading stuff and talking about it.

The beauty is to know everything that you do, plus also know what your team members need to do. And as I said, that the only way to figure that out is do not take your salary or designation seriously.

SAM
Yeah.

HITESH
That's the only way to do it. Right. And these are these are just supplementary add ons that you got in life and you got lucky. Destiny was on your side. Karma was on your side. But don't forget who you really are as a person inside. So stay that boxer, stay that fighter that you’re born with, right, to reach  where you’ve reached today, don’t let that go. 

SAM
I fully agree. I think that's a great a great philosophy on it. One topic I wanted to get into with you is yeah is another thing that I've talked with a lot of our well, our clients and other guests on the podcast about.

With the state of the economy as it is right now, there's been a renewed focus on profitability, whereas before it was more of a growth mindset. I just wanted to get what your thoughts were on this and what you've experienced with with your company and other companies you've worked at in terms of focusing on growth or on profit.

HITESH
Every industry gets a leeway of a decade or more to get growth at any cost, right? And then I would not use the word sunset, but towards a mature stage in that graph, in that cycle, they are expected to be profitable or at least operate at optimal costs.

The same cycle we have been seeing. With my previous generation, when the dotcom bubble happened and everybody almost had a website and they wanted to kind of make it big either on the coding part or they wanted to make it big on the analytics part. 

Data science is actually a concept that came late now, but I would say data mining part. I remember when I was young, I had cousins who were getting like seven figure salaries for just doing basic SQL queries, right? So in those days, you know, getting a job in an IT company and working as an SQL analyst was like a seven figure salary, right?

And then there was a little bit of a standardization in that industry where the salaries became more, I would say standardized the profitability or the  aim to optimization increase. Right?

And then came our time, which was the e-commerce engine where the commandment was growth at any cost, acquire users, get people used to buying online, the ones who  have been buying offline. And this- I was lucky to see a very good 15 years run where, you know, you could get away with kind of murder in the name of acquisition and acquire users.

It may not look very beautiful on the balance sheet statement, but it would look great on the top line. I feel the world, post-2020, is not looking at this industry as a sunshine industry of the next decade. So we have come into this kind of where we need to now operate like how the IT companies have started operating in the early 2000’s, right? And become more cost efficient and focused on profitability.

And now this lever has gone to the AI industries, right? So all these generative AI companies, or the AI-led businesses, they can get away with murder for the next ten years, they can do whatever they want, right? There was three years in the middle, which I also wanted to be a part of, which is the Web3 crypto conundrum, where there was this big promise coming from that part of the world as well.

I still feel that blockchain is here to stay, but something else came into the picture, which is, you know, the AI boat, the data is in a generative… I feel that that that the AI folks will get a free pass for about ten years more. 

And in those ten years, I think our industry will have to optimize itself and get lean and lean more towards, you know, you know, a cost efficient structure. While the new wave can afford to be a little more expensive.

So it's a cycle, right? And so every ten, 15 years, something new will come and they will get the free pass, right? The pass will be for 15 years. Go expand, change the world figure out how the pattern changes, the consumer usage changes, and then when you have enough consumers in the bucket, then try to optimize, right? So it keeps going like that. 

SAM
That's…I mean, that's such a great way to look at it. It makes me think of the quote. That history doesn't repeat itself, but it rhymes, which sounds like the same kind of cycle. You're right. Generative A.I. is in that stage right now where they're just going to keep growing. They can do whatever, and e-commerce is starting-

HITESH
And VCs are kind of sitting with their bank balance and the checkbook open that come and say, take my money or do something in generative AI or deep data science. So it happens, right? The same cycle, e-commerce has gone through that in the last 15 years I would say.

SAM
Well the last thing that I wanted to ask you is just if there was any generalized advice that you would like to give to any of the retailers that are listening right now. The thing is that the retailers are smarter than what I would assume to get more generalized advice.

HITESH
So I would rather give a specific advice- Sure, any specific advice is appreciated too. Yeah, I think the specific advice is that there is is there's a fundamental shift of all consumer generation, right? So when we were growing up, baby boomers, largely our parents, were the decision maker when it comes to spending. Right? 

Which is very, very frugal spending, and spending on luxury or non-essential items were looked at as, as, you know, something which is do only when you know, you’re- you have enough on your plate and enough on your wallet to spend, right? 

Then growing up we learned those, you know, those important values, and then came our generation, which is millennials. And we said, okay, I don't mind taking that business class ticket, but I still want to invest in stock market. I still want to plan for my retirement, right?

So there's a bit of both, right? Going ahead, now the highest spenders will be Generation Z. The Gen Z is not a generation that is planning, planning for the future or thinking about what they're going to do in retirement, right? 

For them the reality is now. So they're not bothered by, you know, cost saving, cost cuttings, or putting some money aside so that they can use it later on, or go to an office every day from 9 to 6, operate from one workplace. So they don't conform to these identities, right?

They conform to effectiveness of work, working from anywhere, and spending anything that they want at that moment, no matter how expensive, no matter how cheap it is. At the same time with a lot of focus on sustainability. 

So I think these three factors: the disposable income of the largest spenders going ahead, the flexibility or the freedom of choice, and the sustainability factor will be very important. That will decide the success and failure of new retailers. The faster we realize which audience segment is going to become biggest, the better we will be positioned to do our businesses.

SAM
Well Hitesh, thank you so much for your insights on this. I yeah, you've actually you've given me a lot to think about this episode. And again, thank you so much for joining us today on the podcast.

HITESH
Thank you so much. It was wonderful chatting with you. Thank you.

SAM
Thank you.

HITESH
Have a good weekend. 

SAM
You as well.