We are live at NetSuite SuiteWorld 2018 Conference.
I'm Michael Krigsman.
I'm an industry analyst and the host of CxOTalk.
We're speaking right now with Erich Gazaui,
who is the CIO of Loot Crate.
Hey, Erich.
How are you?
Good, Michael.
Thanks for having me.
Tell us about Loot Crate.
Loot Crate: a fun company, a membership company.
We connect fans with their favorite fandoms
through collectibles, community, and a really
great experience.
What do you sell?
What are you actually selling?
Every month or, in some cases, every other
month, customers get a crate from us that
have curated items that are unique or exclusive
to the various different IPs that we have.
In these boxes are a range of things such
as T-shirts, figures, or other little collectibles,
as well as the corrugate itself is an element
of the piece as well.
You're connecting fans to the stars on the
shows that they love.
Exactly, as well as comics, video games, and
other specific areas, for example, wizarding
world, anime, and things of that nature.
You're growing really rapidly.
Quite.
How fast are you growing?
Can you give us a hint?
[Laughter]
Thousands of percent since we started the
company.
It's been very exciting.
Erich, as a company grows thousands of percent,
which is almost hard to imagine--I'm just
thinking of how do you hire people, how do
you build new products, how do you retain
the quality--what kind of systems have you
had to put into place in order to manage this
growth?
A variety of them.
When I got to the company, they were still
doing a very manual process when it came to
fulfillment and warehouse management.
That was one of the first systems that we
did, integrating that with our GL, with our
ERP, as well as our data platform and other
things that gives the various teams involved
visibility into the products, both from a
receiving point of view as well as how those
things are going to get out to the customers
and the timeliness of those crates, which
is a big element to Loot Crate, in general.
The mystery and the timing of the delivery
is critical.
All of that depends on the right systems being
in place.
That's correct, including not just the ERP,
but we're talking all the way into the website,
to recurring billing, to our data, to our
shipping and tracking systems.
All those pieces play a role in how we can
deliver the experience to the customer.
In effect, correct me if I'm wrong, you're
a logistics company on the backend with a
fan frontend.
That's right and, on the front end as well,
it's a technology firm.
We've built our own websites to host the order
management and the general funnel of how we
do purchases, all the way into the data platform.
That then becomes a fulfillment and logistics
aspect.
So, the teams involved there are using warehouse
management and using other tools that allow
them to have that granular control of how
the business would operate.
How do you drive efficiency and, yet, at the
same time, keep the pulse on what the fans
care about because, at the end of the day,
growing a business is not about efficiency;
it's about innovation and that connection
with the customer?
It is.
It's about prioritization as well.
I think we have a great design team and a
curation and procurement team that really
get connected with the fans, understanding
how to build the themes within these crates,
and how that connects with things in the fan's
life that may be external to the company,
such as movies, theme parks, and things like
that.
Do you have a fan quality assurance approach?
Thanks for the question, actually.
How do you innovate during this efficiency?
We have a great deal of feedback that comes
from the fans, and sometimes immediate feedback.
That gives us the ability to treat our fans
with the nature that you're speaking of.
In other words, an advisory board or a quality
type control board that would give us insight
into the customers' expectations, as well
as their satisfaction with the products.
You get immediate response back from customers,
and that helps then guide you.
We do.
We get that even during the purpose process
while they're waiting for the crate.
There is a process we use to do what's called
a theme reveal.
We'll let them know what's coming, what the
crate is about, what are the items they might
expect, not necessarily a specific item, but
what that theme belongs to, and that gives
them the ability to decide to purchase the
crate or maybe they're going to wait for something
later, and that gives us that feedback to
say, "Okay, now we see what this customer
is about, and we can start taking numbers
in the aggregate," and say, "Is that going
to change how we do our product or how we're
going to do our curation?"
You're looking at the data and then making
decisions based on the data that's coming
in.
Mm-hmm.
That's correct.
It sounds like that must be a core part of
your business.
It is.
We have dedicated teams for this: the community
team.
Obviously, we have customer support as well
that plays a big role in our communication
with our customers.
But, we have a data team, and we have the
product and the brand.
These all work together with the curation
within the design team to build these themes
and to look at what the ideation would be,
which is a fairly lengthy process at times.
You have systematized all of this.
Yes, very recently, actually.
Using the NetSuite product, we systematized
what we call the assortment planner, our ability
to understand not just the items that go in
the crates, but the various contracts that
we have in place with the IP holders, the
themes that these would be belonging to, whether
there's going to be crossover or an intersection
with other crates that we have, as well as
what's going on out in the world, whether
it's movies, comics, or other events that
might play a role in how we would capitalize
on those events.
Erich, we're here at a NetSuite event, and
so I think we need to talk about NetSuite
a little bit.
Sure.
Tell us about your relationship with NetSuite.
Our relationship is very good.
When I came to the company, NetSuite was already
in place, but it was really being underutilized.
It was a very traditional general ledger approach
and some PO routing.
When we did our STLC process and looked at
build versus buy, it became clear that buying
was the right solution.
Even though NetSuite was in place, we still
did an evaluation of various different platforms
for all the different types of modules that
we wanted to have.
In doing so, we came back to NetSuite and
said, "This is a relationship we want to invest
in," and that ultimately was the decision
for us to continue with the platform.
Building the relationship with our teams at
NetSuite was the deciding factor.
At what point did you conduct that evaluation?
You said you were a NetSuite customer already.
That's right.
Then you decided to reevaluate.
Yes.
At what point?
It was about the end of 2016, a few months
after I joined.
We were up for renewal, and we just went down
to the process, understanding the modules
that we knew were coming, so accounts payable
module, PO routing royalties, incentives,
just looking at all the different things that
NetSuite has to offer, understanding whether
or not we would look for disparate systems
and then have to do the work to integrate
those or just using a platform that had those
things in place.
That process was extensive, and it led to,
now, a very successful implementation of the
assortment planner than I mentioned.
That gives our buying team the heads-up display
they need to understand all the elements of
the items that are going to end up in the
various crates, all the way from the royalty
incumbent to the margin to how we're going
to market these items to what we would do
from a photography and design.
It's comprehensive.
Now, with that, that will actually build the
records in the NetSuite system, which synchs
into our WMS, which gives an automated process
from end-to-end for that team.
All of this, ultimately, is responsive to
that fan experience that the company is ultimately
selling.
It is.
That is right.
Fans play a big role in how we determine what
comes next for our products.
Let's end with my asking you about the CIO
role.
What is the role of the CIO at Loot Crate?
At Loot Crate, it's the head of technology,
so engineering is there, as well as data,
the product management for the technology
stack, and business systems, of course.
But, I think that what's important to look
at from a role like mine at the company is
to build the relationships with the stakeholders,
to really understand their requirements and
their goals, and to support them in that.
It isn't just about, in this case, our fans
or our sites.
It needs to be about the entire business because,
as you said, the business is about the fans.
Empowering our business users, empowering
our stakeholders, our executives is a way
to ultimately empower the fan and to make
the fan feel like they are part of the engagement
that they have with the company.
Okay.
Erich Gazaui, thank you so much.
Thanks for your time.
