Where Did All Your Shopify Traffic Go??

0:00E-commerce is changing right before our eyes. It's actually being rewritten. AI is not going to take jobs away from people that use AI. It's going to take jobs away from people who don't use AI. Our philosophy at Roswell is the only limitation is your imagination. If you can think it, we're going to... And then rounding that out, we're known in the Shopify ecosystem as the agency that doesn't really shy away from a challenge.

0:20Nihar Kulkarni:Nihar Kulkarni is redefining what a modern Shopify agency looks like. As a partner at Roswell NYC, he leads a 50-person powerhouse team behind 70 of the biggest Shopify Plus brands. Roswell is a Shopify Platinum partner and the team behind award-winning builds like DVF.com, a Webby People's Choice winner. People are going to AI to ask, I need a new coffee maker. What's the best one that looks good and take a picture of my kitchen? So that's very, very pressing on a lot of merchants' minds. Amongst the AI channels, 65 % of Gen Zs are open to using AI shopping assistance, and 64 % of millennials, 40 % of Gen Actors, and only 18 % of baby boomers.

1:00It's the new internet. It's the new utility. Either you get on the train, or you're going to get run over, or you're going to get left behind. Hey, everyone. Welcome to another episode of Shopify 1%. I'm excited today because I have someone with me who is at the forefront of commerce, and he's working with some of the biggest brands on Shopify. And here's why I'm excited. We're at a really interesting time right now. E-commerce is changing right before our eyes. It's actually being rewritten, not just tariffs and duties and all of that and the volatility around logistics and margins are being compressed faster than they ever have for brands.

1:41At the same time, AI is exploding and it's changing the way commerce is done. Literally, it's changing it. I read a stat that 84 % of e-commerce brands right now are integrating AI in some capacity. So if you're not, if you don't fall on that 84%, get in there. It should be 100 % in my opinion. And AI shopping is also changing the way customers are buying everything from acquisition to retention to every stage of the customer journey. So my guest today, Nahir, he's one of the directors and partners at Roswell Studio in New York and he works with, is it, I think 70 of the largest Shopify plus brands.

2:19And I just found out, I should have known this before, but I just found out before that they were a winner of a people's choice webby, which is, I think in my opinion, one of the best ones to win. And we'll talk about that a little bit. So this guy knows his stuff. He knows what's working. He's got his finger on the pulse of trends. And so listen closely, because I know that there's going to be a lot of insight here for a lot of our listeners. So Nir, thank you so much for joining the show today. I appreciate it, Jay. Thank you very much for having me on. I've been a big fan of Bold for years.

2:50Yeah, we have 70 plus brands at Roswell and many of them have been using the Bold products over the years. You've been an inspiration to the entire industry for the last decade and beyond and the cornerstone of this, of our ecosystem. And so thanks for having me on. Well, thank you. It means a lot to me, especially coming from you. Can I give you 60 seconds, brag about yourself a little bit, what you do, your company, this is you, the way your mom would brag about you. You got it. You got it. All right. All right. My name is Nihar Kulkarni, managing director partner of Roswell NYC. We're a full service, 360 degree e-commerce agency, a Shopify platinum partner since 2016, a Klaviyo platinum partner, an attentive signature partner.

3:36The list goes on and on. And the reason I say that, Jay, is that we built Roswell on the bedrock and foundation of partnerships. Full of it. Incredible partner for us over the years. And the only way we can service the 70 plus brands that we have at Roswell is if we have those strong partnerships. We're not emailing support at xyz.com to get things done. Our brands expect us to have bat lines that go straight to the top of the food chain. We have three divisions at Roswell, creative, engineering, and growth. And when I say full service is not just a name only. We do this effectively for all of our brands.

4:08On the creative side, we're doing branding, logos, UI UX design, 3D art, photography, videography, and more. On the engineering side, it's basically systems integrations, custom Shopify development, integrations with multiple disparate platforms, basically fitting square pegs into round holes. Our philosophy at Roswell is the only limitation is your imagination. If you can think it, And then rounding that out, we're known in the Shopify ecosystem as the agency that doesn't really shy away from a challenge. We don't say why. We say why not? That's the type of user experience you're looking to create.

4:40Let's figure it out. And then finally, on the growth marketing side, it's full funnel lifecycle marketing. Performance marketing, Google Meta, Pinterest, TikTok, AppLovin, CTV and more. SEO, now AEO. I know we're going to talk a little bit about that in the near future on this podcast, as well as affiliate marketing and then retention marketing. We were one of Klaviyo's original partners back in 2016 when they were 25 people. And we built practice at Roswell because we were integrating Klaviyo. And I said, why not just integrate it? Why don't we actually execute the flows, the automation, the segmentation and whatnot?

5:13And that's how we built it. We were a team of five when I came aboard in 2014. We're a team of 50 now. And I'm proud of the work that my team has done. But as they say in our industry, we're just getting started. I believe it. That's wild. I think we were in the same cohort of Shopify Plus partners in 2016 when they launched the program. Yeah, funny fact. I was in the Partner Accelerator program in 2016 in New York. They had one in New York, Toronto, London, I think Austin. They chose four individuals from teams or agencies or firms to be a part of this. And in New York, there were hundreds of applicants and Roswell was chosen.

5:50We were chosen. And the prize, Jay, believe it or not, was that you were going to be a Shopify expert. and I was like, okay, this is going to change the game for us. We went through the whole program and everything. And it was, I think it was November or December of that year. And the team over at Shopify came up to me and said, Hey, Nihar, got some good news and some bad news for you. What do you want for us? I was like, give me the bad news. And they said, well, you're not going to be a Shopify expert. I was like, I thought I had crushed this. I thought I had, what happened? And they said, well, the good news is you're going to be a Shopify plus partner.

6:20And I was like, no, I came here to be a Shopify expert. And they're like, no, So you want to be a Shopify Plus partner. And then that's how the whole journey began with Shopify Plus, believe it or not. Wild. And at that time, I remember Shopify was really trying to get people to be Plus partners and convince them that like, trust me, this is going to be good. Now they have wait lists and applications. I don't even know what the percentage is like. So do you know, because you're a Plus Platinum partner, it's something like less than 1 % of partners become a Platinum partner. 0.7%. So there's about 4 ,200 plus partners across the world.

6:58Five of them are platinum and only about 30 are in North America and about nine of them are in New York. So that kind of gives you the stratification of where we're at. And you know what? They're not just giving platinum accreditations out. Shopify puts you through the ringer in a good way to be able to say that, OK, you're a platinum partner for a reason. And it's a sense of pride for us at Roswell. Yeah. Well, I remember we went, so we're on the app side and we went through this for years where there was one app store and you could be a hundred million dollar plus brand or someone just starting the store and you're shopping the same app store.

7:33And you don't know if an app is a guy in his basement or if an app is a couple hundred team that can support you 24 seven, that has all the security standards you need and uptime. And you just couldn't tell. And I remember for years saying Shopify needed some way for a Plus merchant to know that an app is, that a Plus merchant can trust it. Credible, right? Like, and some requirements, do some code reviews, some security, like levels have to be met, just like standard stuff. And so a few years ago, they launched the Plus app, certified Plus app program. And we were the first ones in that as well, too.

8:11So we're on the app side, you're on the agency side. This should be a good conversation. One of the things that you, from the outside, you can correct me if I'm wrong, but I feel like what you do a little bit, there's other agencies that I think do this, but you really care about the growth and the business itself, not just redo my website. Let's do a makeover. You seem to take a more of a holistic approach. What does that mean? Yeah, I appreciate that, Jay. And thank you for recognizing that. Roswell, our motto is that we're in the business of building businesses. We take that very seriously.

8:47We approach every opportunity as a land and expand scenario, not just for our own profit motives and our own growth motives, but because we know we can help a brand really drive and achieve those KPIs and the revenue levels that they're looking to accomplish. You can't look at it in a siloed sense. The full service approach really works when brands understand that they can work with us in a few capacities, one capacity or all capacities. But the reason it works is that if there is an issue with a retargeting script and we're not doing paid ads with the brand, we have that understanding on how we can go in and remediate that tracking script so you're not having double attribution on a meta ad spend or something of that nature.

9:27And brands appreciate that because we're not asking questions to their third-party agency that's handling performance marketing or SEO on how to handle certain things in terms of schema markup or other aspects that are critical for page speed and so on. we know what to do. We have a team internally that we can consult with and we can get it done. And that's really the advantage. And we're an agency that when we engage with somebody, we're not coming to the first meeting with an invoice and putting our feet up and saying, hey, what do you want us to do? We're coming there with a plan, a roadmap and saying, this is what we're going to do for the next three months.

9:58And then in Q3, we're going to do this. In Q4, Black Friday, Cyber Monday, we have brands that we encourage all of our brands, start thinking about it in April or May. I mean, it says you start thinking about Black Friday, December 15th, but that's, come on, that's a little too much. But I think April, May started planning out your strategies and whatnot. And I think that holistic approach, understanding that you can't have performance marketing without retention because then it's like pouring water into a sieve. You're never going to boil any water because it's all going to flow through, right?

10:26You plug up all those pools using retention marketing strategies, you got water to boil and you can retarget, retarget on a more cheaper level. A lot of brands don't realize that when your CAC is as high as it is right now with Duopoly of Google and Meta, and that's your only focus is just acquisition, you're never going to be profitable because you're just having to pay for the same set of eyes over and over, and that really eats into your margins. And so our approach is very holistic. You can't have one without the other. We work with brands. We let them know that if you're, you may not want to work with this as a growth marketing, you have your own agency, totally fine.

10:59But we advise them that if you're doing X and not Y, there's only so much that Z on our end can do, you know? And so we try to advise brands on a holistic level. Yeah. And it's interesting. I feel like that's evolved a little bit. And it used to be that when you would go to an agency's website and if they had everything across the top, like everything from email marketing, copy, website, dev, SEO, product photography, we do it all. The sense kind of was like, well, what do you specialize in? You can't do it all. What's your this, but there's actually data that shows that when you use an agency that has multiple components, there's actually higher return because they, there's a higher conversion.

11:43Like the optimization is better because this group knows is talking to this group and there's better communication. They work together, the dev and the creative is connected. So like, I think that viewpoint that I want an SEO specialist, I want a email marketing specialist. I want a growth marketing specialist isn't necessarily true. No, we're seeing a lot of brands now, Jay, that just don't want to be able to have to juggle between full disparate teams. You have one team for performance, one team for retention, one team for SEO, one team for affiliate, another team for design. That's insane. How many people do you have to coordinate with?

12:23Just need to have a full-time person. It's ridiculous. And I think a stat that I read that was that brands using integrative creative and engineering and media see up to a 20 % lift in conversion rate versus not teams. And that's something that's really important that we talk to our brands about is that we're coming to the table with a holistic strategy on how we're going to grow your brand. And we have about, out of the 70 brands that we're working with, we have about a dozen or so that are working with us in multiple capacities at Roswell. And they found it incredibly effective. And the brands that are going up market and into the large account enterprise realm, they're really understanding and embracing the full service approach for an e-commerce agency because we're all coming into our own.

13:02We started out purely dev, then we moved into design, then we moved into retention and more recently we'll funnel lifecycle marketing. And I think it's been very effective, Jay. So what's at the top of everyone's mind right now? What are the agencies like stressed about? What are they excited? excited? What is the main conversations you're having with brands right now? I think whether you're a design dev e-commerce Shopify agency or whether you're a retention agency, I think that in 2016, when we first became a Shopify Plus partner, now Platinum partner, it was, I wouldn't say it's the Wild West, but it was the beginnings of the modern day e-commerce agency.

13:40There were, you go and look at a number of brands and you target them and whatnot, chances are they weren't on Shopify in 2016. And there was opportunities for migration and for a number of platform expansions and whatnot. Chances are they weren't on Klaviyo. Chances are they weren't doing subscription in the right way. And so the opportunity for migration and integrations was so much more. Now, fast forward nine years later, we'll be 10 very, very shortly. The brands that we're approaching right now, nine out of 10 times are already on Shopify. Nine out of 10 times they're already on Klaviyo.

14:12Nine out of 10 times they're using Yapo, they're using Recharge, they're using Attensive, they're using all of the standard tech staff, they're using all the bulk commerce apps. And so the challenge that we're talking about with agencies is that how do you present value to a brand that isn't related to a migration or to a tech stack overhaul or things of that nature? You got to look at their business and understand where are the knobs that I can tune to really ratchet up AOV, ratchet up LTV, increase frequency of purchase, bring customers back to the site? How can I leverage AI tools to be able to squeeze every dollar possible out of a cohort and so on?

14:49And I think that's really what is on the mind of a lot of agencies is that along with AI disruption. I think the concept that we're trying to implement at Roswell is that we're billing for our brains, not for our hands anymore. And that's really important. I think there's a small window of opportunity within the next two years that agencies can do that because once the AI tools become ubiquitous and best practice and standard, it's going to drive the price down with all the freelancers all over the world. And brands are going to say, well, I'm not paying that amount for this type of service because I can get it elsewhere.

15:18And that's going to depress the price, but not the value. And so within the next two years, agencies that really embrace AI, optimize their delivery processes and sales processes and value processes are really going to be successful because you can do 3x, 4x, maybe even 10x the volume of words you can do with the same person. Lastly, I'll just leave this with you, is that AI is here. AI isn't going anywhere, and it's the new internet. It's the new utility. Either you get on the train, or you're going to get run over, or you're going to get left behind. And that's really what you do. AI is not going to take jobs away from people that use AI.

15:53It's going to take jobs away from people who don't use AI. Yeah, agreed. So what are some of the ways that you're seeing brands, I guess two questions use AI for e-commerce and also the second question I want to ask is like I think it's the number one question I get asked is like optimizing for AI like it's SEO is will always be SEO but more and more people are going to AI to ask what is I need a new coffee maker what's the best one that looks good and take a picture of my kitchen like literally so that's It's very pressing on a lot of merchants' minds. And then also, I get this question a lot.

16:32I know I should be using AI for my store. I know I should be using things like AI to turn my images into video and things like that. I just don't have time to explore it. I need to book off a week and play with AI to figure out the things. But maybe we could fast track some of that. What are some ways that you see some of the top brands using AI to run and improve their business? And then let's talk about getting found through AI. Yeah, for sure. That's great questions there, Jay. And getting started, it's just, you have to understand the market, the openness to using AI shopping assistants now.

17:06You have boomers, Gen Xers, millennials, and Gen Zs in the market and soon to be Gen Alphas, right? It's interesting. I read this the other day. Amongst the AI channels, 65 % of Gen Zs are open to using AI shopping assistants and 64 % of millennials, 40 % of Gen Xers, and only 18 % of baby boomers. In terms of AOV, plus 30 % AOV on orders attributed to AI searches versus traditional channels. And so for brands, in terms of embracing AI, what's important is not just understanding how it can be an enhancement or augmentation tool for delivering your own assets on the site. That's obvious. You can use AI for copy.

17:44You can use AI for images. You can use AI to even code if you want, if you want to do some basic things on the front end of your site. But what AI is really going to do to drive revenue is increasing that conversion rate on site. Using AI sales agents, like Gorgeous has a fantastic one, right? When you walk into a store in a brick and mortar location, someone looks at me and they'll say, oh, you're a size 32 waist, 34 long, right? I kind of tell, and here's some jeans that you might like, and here's some tops that go with it. And I'm like, I don't really like that type of color. Okay, well, what about this?

18:17And so on and so forth. But this AI sales agent is allowing you to do that at scale. It's so critical. On the growth marketing front, obviously everything with performance marketing is going to be AI driven in terms of optimization in the near future. When it comes to retention, email and SMS, if you're still doing batch and blast brands, you're not doing it right. You have the ability with AI right now to create these AI powered segments that are so precise in terms of what the interests of that group are that you can go in and say, hi, Jay, I noticed that you really like white hats and black t-shirts.

18:49Then you think about, what do you think about this brand? Or what do you think about that? And, or this styling of trousers or pants that might go with it and so on. And the important thing to note is that the subject lines, the content inside of the message that you're creating, the actual imagery and all that needs to be personalized. AI, if you're doing it right with, as a brand is for personalization. It's creating a one-to-one bond with that customer at scale. And that's really how brands are going to be able to embrace and really drive revenue amongst their competitors that aren't using AI because you're talking to a customer on a level that is meaningful to them.

19:23And AI shopping isn't going anywhere. I mean, it's a year from now, a year ago, it wasn't even a thing. Now you have integrated with perplexity, which at GPT, it's going to be everywhere. The other day also, I was having lunch with somebody from the C-suite over at Gorgeous, which is one of my favorite platforms out there. And he was, it was the first cold day in New York and he was shopping for what seemed like gloves on his phone while we were making, while we were just ordering food. And I said, are you on ChatGPT ordering gloves? He was like, yeah. And I said, that is insane. Did he complete the order in ChatGPT or he was using it for research?

20:00Yeah. And it just dawned on me that the way people go to Amazon, they just buy basics, toilet paper, gloves, just things like sunglasses, just basic things that you need, but it doesn't require a lot of thought, but you want to make sure you're getting the right product, right? Yeah. You're not going to buy a$4 ,000 iron door on ChatGPT. You're not going to buy a$15 ,000 necklace, anything over two, 300 bucks. You're probably going to want to actually go to the site. So it was important to be found in AI search results. And that's really important for brands to understand when they're embracing AI, but also understand that the opportunity for commerce within the AI chatbots is going to get larger and larger, especially as the Gen Zs and the millennials start moving more so into the positions of power with discretionary income that they can spend.

20:49When that happens, you're going to see a massive explosion of individuals really buying through that, buying through the chatbots, and then looking at products that they really want that are more high price point, more high average order values, and going to the sites to kind of do further research. But the quality of traffic that you're getting from the AI search bots is far greater than the SEO elements. Rounding that out, if you're a brand and you're seeing traffic drop in SEO, you're not alone. It's across the board. People aren't clicking on search results as much as they used to. They're actually going into the AI search results.

21:22Now, it's not to say that SEO is important. It's all a part of AI search, SEO, AEO, and GEO. But being found in those AEO results are critical. Your content being used in the GEO results, critical. And still being in the top five, top 10 on Google, also critical because they all come together to really drive your brand from an AI standpoint. Have you played around with Sienna AI? I haven't yet, but it's on my list. Okay. They're in New York as well, too. Actually, I had her on the show, Lisa. And it's, I mean, it works with Gorgias. So Sienna is not a support platform. it's just an agent. So you could use Zendesk, you could use Gorgeous, you could use Intercom, whatever tool you use.

22:05Sienna is like, it's like a person, like you create an agent and yeah, a persona. So like I could create a Nihar and that's my person and he has a personality, but I train him on all the products. And it actually, it sometimes takes weeks to train your agent. It starts with going through all your docs, but it's, it does really what you're saying. and it doesn't just support people on the website. It recommends if you have a subscription and someone's buying something, it'll say, oh, do you want me just to add that to your next month? Subscription going out. It can manage, it can track. It does everything.

22:40It's mind blowing. And then it operates within Gorgeous. So like if you have a Gorgeous account, your agent can answer tickets. It can interact through the chat, like whatever a human would use. It's literally that. And then the one, anyways, look into it. Because it's - Look in a car. It's like you bought a car and now it's providing the fuel on the driver. Yeah. And if you switch cars, you take that driver with you. So if you switch from Zendesk to Gorgias, you keep your agent. You keep all of the knowledge and everything and it goes with you. So it's like that driver knows you, knows your routes, knows your whatever.

23:15You get a new car, same driver. Yeah. That's Sienna. That's awesome. I'm going to check that out because as I mentioned earlier, AI is not going anywhere. And it's our duty to our 70 plus brands, hopefully 100 next year, to be able to advise them on the strategies that are going to make them profitable and stand out from the fray and the evolving e-commerce ecosystem as it applies to AI. Yeah, it's going to be I always find when I have these conversations, it's hard to not let your mind wander and go a little bit further. Because like as you're talking about personalizing email and how important that is, my mind goes to in a year, am I even going to be reading those emails or is my agent going to be reading them?