Deepfake the World

Phillip: [00:00:28] Hello and welcome to Future Commerce. I'm getting it in before Brian. The podcast about the next generation of commerce. I'm Phillip.

Brian: [00:01:30] I'm Brian. And today, Phillip, I want to ask you, how has it been being a one-car family these days?

Phillip: [00:01:39] Oh wow, we're jumping right in. 

Brian: [00:01:39] I did this early on in my life. I did this early on in my life, and I had a lot of waiting for buses.

Phillip: [00:01:47] Oh, my gosh. Oh, that's a story. I could give you a story. We're going to cover making weird economic decisions in the time of economic uncertainty. I'm sitting in the middle of a hurricane right now in Florida because that is very 2022. We're also going to cover maybe my snack drawer, some VR stuff, and then I really want to get into prompt engineering and how it's going to change and how AI image engines are going to change how we do eCommerce. But yes, let's talk about...

Brian: [00:02:22] In which we deepfake the world.

Phillip: [00:02:26] Oh, wow. Wow. Deepfake the world. That's a show title. That's a great show title. Okay. All right. What's it like being a one-car family? I committed, for those who aren't familiar, I committed about... I'll tell you exactly how many days ago because I've been tracking. {laughter} I committed 190 days ago to be carless for one year. We were a two-car family. We're now a one-car family. And I figured I'll just ride my bike everywhere. And it's been going pretty well, Brian.

Brian: [00:02:54] And you went out and you got an e-bike because riding a mechanical bicycle everywhere, you needed to give yourself at least a little bit of a boost as you transition.

Phillip: [00:03:06] Well, also I knew I was training for a number of ultramarathons. I counted it up. I've done eight marathons or greater distances in the past ten weeks. And so...

Brian: [00:03:22] You're crazy, man.

Phillip: [00:03:23] In my scaling up to run 100 K, I've run, I think, close to 2000 miles this year already, and we're in November.

Brian: [00:03:33] Sheesh. 

Phillip: [00:03:33] So I needed the help. Let's just say that. I needed the help. I bike commute to downtown West Palm Beach, which is about 10 or 11 miles depending on how I go. So yeah, I did get an e-bike. I bought an REI e-bike back in March, I think, or so when I sold my car and it's been going great. The biggest thing that I figured out is Florida is terrible with public transportation. Absolutely terrible. Most American cities are terrible with public transportation. Florida is especially horrendous. We are getting better. So we have this high-speed rail system that connects. 

Brian: [00:04:16] Which is amazing.

Phillip: [00:04:16] It's incredible. It's called Brightline and it connects... Which, by the way, Brightline is a whole commerce story unto itself and something that we should cover at some point. I'd love to get someone from Brightline on the show.

Brian: [00:04:28] That would be fun.

Phillip: [00:04:28] That would be amazing. We should. Actually, I could make that happen. I should make that happen. But  [00:04:36]Brightline connects Miami, Fort Lauderdale, Palm Beach, and soon Orlando at the end of the year. And these major metro centers have never been connected in Florida. They take hours to drive between. It takes two and some hours to drive to Miami and traffic. It's much closer than that, but now with a high-speed rail, it's less it could be an hour or less away. And that means I can ride my bike to the train and take my bike all the way to Miami. The one problem is getting around town on a bus is so unbelievably inconvenient. [00:05:09]

Brian: [00:05:09] Yeah. 

Phillip: [00:05:10] The buses are infrequent. I would love to sit around and wait for a bus, but the buses are infrequent, especially where I live out west and they go on very, very large loops, so they don't have small little lines that connect things in logical ways because nobody uses public transportation in Florida. It's very car-centric. So you're sort of in this catch-22 of you're walking five miles or riding your bike a few miles to a bus stop, only to wait for over an hour for a bus to go in a big circle for an hour and a half to try to get to where you're going. It's miserable.

Brian: [00:05:44] Might as well just bike directly there.

Phillip: [00:05:46] Might as well just bike directly there. That's what I've taken to doing and I've put... I've got to go add it back up. I think it was 1200 miles on my bike a couple of months ago when I last looked because the e-bikes keep track. They have an odometer.

Brian: [00:06:00] Wait, hold on. You've biked or run 3200 miles.

Phillip: [00:06:05] Yeah, over 3000 miles this year.

Brian: [00:06:07] That's a full-time job, man. {laughter} That's more than a full-time job.

Phillip: [00:06:14] I might have some news around full-time employment at some time real soon. But yeah, so running and biking is definitely a full-time job. {laughter} How has it been? It's been amazing. I've had one flat tire on my bike, which is a miracle and for the most part, the biggest unlock, I'd love your perspective on this, by the way. The biggest thing for me is it requires me to be intentional. I have to think ahead. If I don't think ahead, everything falls apart. So I have to plan where I'm going to be. I plan events to be where I'm going to be at a bikeable distance. If that's not the case, then I have to really think ahead and plan an Uber early in the day. And I've only taken six or seven Ubers in the last few months. Really, I'm just being incredibly intentional with the way that I plan my time and/or making space in my day to be able to use the family car, which is very infrequent. For the most part, you'll catch me zipping around on my bike. So I love that sort of limiting factor of having to think about things.

Brian: [00:07:24] It's a boundary.

Phillip: [00:07:25] It's a boundary. That was a big thing for us in 2019, 2020 was talking about those artificial limitations that require you to have to be creative.

Brian: [00:07:35] Yeah, I love that. Do you feel like you have been limited at all or do you feel like you've found a way to make it happen?

Phillip: [00:07:44] Oh yeah. I put this tweet out yesterday. We have our Archetypes event coming up in Miami, and the delivery happened over the weekend for this one particular very exciting piece of merch that we ordered. It's incredible. I'm not going to reveal it here yet, but the boxes didn't get delivered to the office, so I had to go pick them up at the post office and I go to the post office to pick them up and these boxes are comically large. So getting them on my bike rack, it's like it was taller than me on my bike. {laughter} It's really, really funny, actually.

Brian: [00:08:21] I love it. I feel like that's the epitome of you don't care how people view you anymore. You're riding down the sidewalk and you've got two giant boxes strapped to the back of your bike and you're like, "Yeah, whatever."

Phillip: [00:08:37] A founder friend of mine and a brilliant person innovating in sort of the note-taking, second brain, AI space is a guy named Nick Mohnacky, a serial startup founder here in South Florida.

Brian: [00:08:51] That's cool. I love that.

Phillip: [00:08:52] Nick is amazing actually, and their product bundleIQ is kind of magic. I've been using it for a bunch of things, especially on the podcast front lately, something we could get into at a later stage. But he happened to see me out there with the boxes on the back of my bike and he's like, "What are you doing? Do you need help?" I was like, "I need help, but not right now. I think I need some sort of mental health check."

Brian: [00:09:20] I'm just glad you didn't die.

Phillip: [00:09:23] Really funny. I did almost run into an iguana that was eating a piece of pizza.

Brian: [00:09:28] Oh, that's the iguana pizza post. That's where that came from.

Phillip: [00:09:32] Everything's interrelated. I stopped the bike because the boxes were falling, and I almost killed this iguana that was eating a piece of pizza. It was awesome.

Brian: [00:09:41] Phewf. 

Phillip: [00:09:41] But all in all, it has been a great experience. Right now, I'm sort of halfway through the journey and being carless for a year, and on the whole, it's been great, but there are definite limitations.

Brian: [00:09:59] Speaking of everything being interconnected, let's get back to your tweets for a second here. There are two tweets that I've come back to. One was one that blew up. Like it blew up. But before we get to that one, one that got a lot of engagement didn't necessarily blow up like the other one did was your snack drawer post on Twitter and you admitted it was a 100% engagement bait because your snacks seemed to be lacking. Definitely did not feel like the kind of snacks that well, that Twitter would approve of.

Phillip: [00:10:41] What was the name of our last episode, Brian?

Brian: [00:10:44] Dirtbag Phillip.

Phillip: [00:10:46] Dirtbag mode.

Brian: [00:10:47] Rice Krispie Treats.

Phillip: [00:10:50] Cinnamon Toast Crunch Rice Krispie treat cereal bars. That's what I've become. I'm leaning into it. That's okay. Clif Bars, Fig Newtons. Smartfood.

Brian: [00:11:04] I feel like after this phase of Phillip ends, you're going to graduate to Costco, and I'm going to be super happy about it.

Phillip: [00:11:12] I'm really looking forward, actually, to graduating to Costco. I don't know that I could. I went to Costco. You would speak about bikes and snacks. I went to Costco to pick stuff up on the way home because it's three miles from my house. So I was hanging out at Starbucks.

Brian: [00:11:28] Wait, you have a Costco three miles from your house?

Phillip: [00:11:30] Yeah, I have a Costco three miles from my house.

Brian: [00:11:32] Oh, geez.

Phillip: [00:11:34] Yeah. It's an easy 5K to run to go eat that chicken bake. {laughter} You can burn 200 calories right before you go and eat 1200. Yeah. So I go to Costco on the way back to the house and I have Pannier saddlebags on my bike. And I get a bag of popcorn from Costco. BOOMCHICKAPOP. I get this bag of popcorn.

Brian: [00:12:07] Please tell me you opened it and held it on your handlebar and ate it as you were riding along.

Phillip: [00:12:12] That is dirtbag, Phillip.

Brian: [00:12:14] That's dirtbag, man.

Phillip: [00:12:16] No. It couldn't fit anywhere. It couldn't fit into the saddle bags. It was too big.

Brian: [00:12:20] So you held this in your hands?

Phillip: [00:12:21] I had to hold it on my handlebar while I'm riding. It's flapping in the wind. It was fantastic.

Brian: [00:12:28] I just wish it was open. That would have completed it.

Phillip: [00:12:31] That would have been hilarious. No, I don't have great snacks at the office and you know what we need is Kendall Dickieson and maybe Nate Rosen and some people to give us some good ideas for snacks. But I need good...

Brian: [00:12:50] All I'm saying is the Pepper Jack cheese crisps at Costco are delicious.

Phillip: [00:12:55] Yeah? What's the brand on those? Is that a Kirkland thing?

Brian: [00:12:58] I forget. No, it's not Kirkland. I have a bag in the house, but I'm not going to get up and go get it.

Phillip: [00:13:04] No, I don't get them now. A Sonoma Creamery is what comes up first. I don't know if that's true or not.

Brian: [00:13:12] That's probably right. That sounds right.

Phillip: [00:13:15] Pepper Jack crisps. Those sound awesome. You can buy with Shop Pay on their website direct to consumer. Oh, here. This is everything that is wrong with eCommerce right now, by the way, is that I can make four interest-free payments with shop pay. It's $50. It's 47.99 for I don't know how many bags. It doesn't give me any idea. It shows a bag next to a bell pepper So the bag doesn't look all that large. A one time purchase is $47 or I can subscribe and save $38.39. It's not winning me over.

Brian: [00:13:51] I think I paid like $8 for a bag at Costco.

Phillip: [00:13:52] Probably eight bucks. Eight bucks at Costco.

Brian: [00:13:54] Yeah. I mean, it's a real bargain.

Phillip: [00:13:55] This is the thing that doesn't make any sense. And this is where if we're making predictions, we're coming up on prediction season pretty soon, but if we're looking forward to next year, The market, I feel like, is not going to be able to withstand some of the pricing disparity that we have from channel to channel. So if you go to... I was at Dick's Sporting Goods, and I'm standing in line at checkout at Dick's Sporting Goods, and they have, like anything, they have the impulse purchase section. You've got snacks right there at Dick's. So you can grab a snack at your Dick's and you have a...

Brian: [00:14:34] I just had an idea. Keep going.

Phillip: [00:14:35] You have a small bag of popcorn and it might have been BOOMCHICKAPOP. It's a small snack-size bag of popcorn. That bag is $3.50, a small-size single-serving bag of popcorn. Now wait, you go to Publix, which is right across the street from Dick's, and you get a normal-sized bag of popcorn that's in the snack and the chips aisle. And it is six servings maybe, seven or eight servings at most. That is $6.50. So now you're definitely a better value than your single-serving BOOMCHICKAPOP, but you go to Costco, Brian...

Brian: [00:15:14] {laughter} Yep.

Phillip: [00:15:17] And you buy a bag of popcorn at Costco, BOOMCHICKAPOP, and it is $6 and that sucker is 36 servings.

Speaker2: [00:15:23] It is. That's right.

Phillip: [00:15:24] It is the biggest bag of popcorn you have ever seen in your life.

Brian: [00:15:27] And trust me, we eat every kernel. This is why I have to shop at Costco.

Phillip: [00:15:36] This is also why America runs not on Duncan on statins. {laughter}

Brian: [00:15:49] {laughter} You know how in wine you've got like your standard wine bottle and then you have like the Magnum and then you have the Jeroboam. I feel like we need awesome titles like that for these different sizes in...

Phillip: [00:16:01] Jeroboam-size BOOMCHICKAPOP.

Brian: [00:16:03] Exactly. It's Jeroboam-size BOOMCHICKAPOP. I love it.

Phillip: [00:16:06] The deep cut is that's not even Jeroboam. That's Rehoboam.

Brian: [00:16:10] That might be a show title.

Phillip: [00:16:13] That's it. That would be a really deep cut. All right. I really think that there's something to be said about...

Brian: [00:16:18] I think you're right. I think you're right, man. I think that not only that, then you start to get into talking about stuff that's similarly branded.

Phillip: [00:16:28] Not even similar. It's identical.

Brian: [00:16:30] It's identical.

Phillip: [00:16:30] It's BOOMCHICKAPOP kettle corn.

Brian: [00:16:31] Yeah. Well, sometimes you're at the Home Depot checkout and they have like the Home Depot brand snack too or whatever special brand.

Speaker2: [00:16:44] Home Depot brand. {laughter} Get your craftsman jerky.

Brian: [00:16:48] {laughter} Actually, that sounds pretty awesome.

Phillip: [00:16:50] But there's an interesting case study that has been proliferated on Twitter. I don't know that it's... I haven't actually...

Brian: [00:16:57] Can you trust any case study posted on Twitter?

Phillip: [00:16:59] No, I don't trust it. No. But there were... I think Perky Jerky was the one that sort of proliferated this idea that they found their channel fit by going to Lowe's and Home Depot.

Brian: [00:17:14] Yes.

Phillip: [00:17:15] We found the perfect customer. Our ideal customer is a Home Depot and Lowe's shopper and their jerky and caffeinated. Perky. Both jerky and perky are things that resonated.

Brian: [00:17:31] I feel like it's Mike Lackman that told us that story. 

Phillip: [00:17:35] Maybe. 

Brian: [00:17:35] Before we leave snacks, really quickly...

Speaker2: [00:17:37] Maybe. But I've seen this now. This is almost as popular on Twitter as the Costco Hot dog is popular on Twitter.

Brian: [00:17:46] Before we move on from snacks real quick, I did have a brain child that that I feel like, why haven't we thought of this before? Why is not every single eCommerce checkout lined with snacks that you can add to your cart on the way out that just get thrown into the box?

Phillip: [00:18:03] The impulse. Yeah. We need to.

Brian: [00:18:05] We've done cross-sell within brands, but we've never done cross-sell with just straight snacks.

Phillip: [00:18:11] Somebody is going to say, "Well, didn't you guys have like Connor MacDonald? Formerly known as Co-op Commerce. They had a rebrand earlier this year, but Co-op Commerce.

Brian: [00:18:24] Right.

Phillip: [00:18:25] Their whole play was that post-purchase upsell, and post purchase upsell being a marketplace.

Brian: [00:18:29] But that was like complimentary brands. That wasn't straight snacks.

Phillip: [00:18:34] Well, you just broke my brain. Complimentary doesn't... Yes, but the ones that were the most frequent opted in are those that have this broad sort of mass appeal.

Brian: [00:18:52] Sure.

Phillip: [00:18:53] To a certain kind of psychographic or maybe even firmographic of some sort where it's like, "Yeah, I'll buy some Omsom. I've heard of that." "Oh, I'll buy Fly by Jing. I've heard of that." Those are snackies.

Brian: [00:19:08] But let me get more specific. I'm saying why is there no Shopify app just for BOOMCHICKAPOP.

Phillip: [00:19:15] Just for upselling BOOMCHICKAPOP. Yeah, this is the direct to consumerification of everything. Every brand eventually will have a Shopify app for upsells at the checkout.

Brian: [00:19:27] Exactly. Yes.

Phillip: [00:19:28] You heard it here first folks. Well if you have suggestions, if you are Kendall or Nate or someone who aspires to be a Kendall or a Nate who has snack drawer suggestions, I'm taking them.

Brian: [00:19:40] Man. I'm telling you, you don't even need Kendall or Nate. You just need to go to my Costco and I'm going to...

Phillip: [00:19:46] No, no, no, no, no. It's need to fit on my bike, Brian. I need to be able to take it to the office.

Brian: [00:19:52] I mean, you just need to get better, bigger saddle bags for the back of your bike.

Phillip: [00:19:57] What really needs to happen actually... 

Brian: [00:19:59] Strap a box and go full dirtbag.

Phillip: [00:20:00] This would be the end of this conversation.  [00:20:03]The end of the conversation is most of these snacks were purchased at the CVS across the street in downtown West Palm Beach. And what we really need is distributors and the buyers at CVS and the distributors that work with them to do a little bit of a better job of merchandizing and having a greater range of selection. That's what would actually change this is you need distribution. I can't be expected to spend $39 on Brian's cheese snack so that I can impress Twitter with my snack drawer. [00:20:43] You know what I'm going to do, actually? We haven't ever done and we should have this because we have enough of a listener base. We need a Photoshop battle. Someone needs to Photoshop in bougie snacks into my picture of my snack drawer. Someone just do that for me.

Brian: [00:20:59] Wait, hold on. Or they could just use CLAID.ai.

Phillip: [00:21:03] Oh, that's a wow, Brian, you're on point today. What an incredible segue.

Brian: [00:21:12] I mean, I feel like you set it up and I just knocked it down.

Phillip: [00:21:16] Explain this to the people.

Brian: [00:21:18] So CLAID.ai is effectively a tool for creating content, using AI to massage and create content that you can use to go as a brand, go to market with.

Phillip: [00:21:35] Massage that message. 

Brian: [00:21:35] So let's say your department, your eCom department, is not getting the love from the brand department or the marketing department. And you need some assets, stat, to go sell and you need to get to different segments of the marketing and you're really having trouble creating content to do that that's bespoke and specific. Well, CLAID.ai can help you. And no, that is not an ad for CLAID.ai.

Phillip: [00:22:08] No, it's not.

Brian: [00:22:10] Not sponsored.

Phillip: [00:23:28] We are connected to Sofiia Shvets, who's the Founder of Let's Enhance, which I think might have rebranded or they have a separate offering called Claid. They are experimenting. So with Let's Enhance, they had this really incredible AI tool that would basically enhance images so up-res them, format them for Google shopping, adhere to certain whatever the extraneous sort of guidelines might be for posting in certain marketplaces like on Amazon, maybe potentially swap backgrounds or recolor images. If you've ever paid in the past... Brian, do you remember Adobe acquired this tool that created dynamic images years and years and years ago?

Brian: [00:24:43] Yes, I do. I think. Did we see it at Adobe Max?

Phillip: [00:24:47] We might have, but it was a tool that was a standalone tool, and I cannot remember the name of it for the life of me. But it did something to the effect of years ago I did work for a footwear brand called Jack Rogers, and Jack Rogers had a shoe customizer where three parts of the shoe, four parts of the shoe could be customized with different colored leathers. If you were to produce an image in this customizer for every algorithmic outcome of the 20 leathers and four different regions for customization, plus a monogram... There was something to the tune of like 2 billion potential permutations of options and it doesn't make sense to pre generate 2 billion images. You'll probably never, you'd never get through it. So you kind of generate these images on the fly. There are tools that do that now. Back then there was one SaaS product that did that, and that product was acquired by Adobe and then taken away from the market. You could only get it if you bought into the whole experience platform as they are wont to do. But imagine if you could tell an AI, "Hey, make the shoe red."

Brian: [00:25:58] Right.

Phillip: [00:25:59] And then the AI is like, "You got it." Bada bing, bada boom.

Brian: [00:26:05] {laughter} That's how AI sounds, by the way.

Phillip: [00:26:07] It's "Bada bing, bada boom. You get your red leather." That was terrible. What's amazing is they've taken the next step. And Sofiia was showing me their new product, which they're working on right now, getting ready to go into actual customer beta. But they are using open AI, and I believe I'm not sure which, I should ask. I don't know which particular language model or the image model they're using. And I'm going to speak with a little bit of ignorance here, because while I've been playing with a lot of AI, I'm not deep into all of the nuances of all the different ones, but this is a photorealistic implementation, so it must be in the form of like mid journey. I believe that this could be based on mid journey. I'm not quite sure, but I know that they are working with the OpenAI team and Sofiia, yes, can clarify. What they have done is they can ingest and teach the AI through 3D models. So if you can import a 3D model of your product, you can then compose images with the AI through prompts alone. What are some of the things that you anticipate, Brian, that this is useful for? Because you said eCommerce and channel teams being able to be independent from having to wait for creative from the brand teams.

Brian: [00:27:44] Yeah, I think that there's a lot of really bad UGC out there and I think there's opportunity to get people to opt in to having things enhanced or if they post, they're giving you the opportunity to use their images. There's different ways you could go about doing that. So you could take stuff from your community and actually make it something that's really, really appealing and more professional. And you also, as a non technical photographer could go take photos. If you have a camera or an iPhone, you can go and take photos and then give them the treatment that you want to give them and show off your products. And also, I think you can pull in and leverage assets that are probably in whatever library you have access to, whether it's a free library or a paid library of images and use stuff out of that and combine it with product.

Phillip: [00:28:57] I think it's even like it could be even more powerful in that [00:29:00] the whole of the engine has contextual understanding of certain things in the world like the Eiffel Tower. So if you didn't want to have to Photoshop your image into a picture of the Eiffel Tower, but you wanted to say pre compose something like, "Oh, give me, I don't know, a Sour Patch Kid gummy taking a selfie in front of the Eiffel Tower." Like you would have had to 3D model that, write a brief for it, get your team to actually give you a bunch of options. That is the kind of thing that would have taken weeks. [00:29:36]

Brian: [00:29:36] This is the kind of thing I feel like where...

Phillip: [00:29:38]  [00:29:38]You can just write it out now. And the same brief that would go to the creative team now goes to the engine. [00:29:43]

Brian: [00:29:43] Yeah, exactly. A lot of brands won't even attempt stuff like this because they don't have the budget. So it doesn't look like a cost savings necessarily. But this just allows you to do so much more. I think that that's oftentimes a lot of companies won't buy into stuff like this unless they can say, "Oh, these are the cost savings that will get." And yeah, you probably will be able to make a case on that alone.

Phillip: [00:30:10] Well, yes, it's a productivity enhancement for sure. It is also a creativity enhancement and maybe a little bit to a degree that would scare some people. Like, "I don't want to give my eCom team unlimited creativity over things." We still need checks and balances for brands.

Brian: [00:30:25] Let's de-stylo though. 

Phillip: [00:30:26] Right. 

Brian: [00:30:26] I think that  [00:30:28]these kinds of tools are going to continue to point us towards better collaboration between departments and probably tighter teams and running diverse teams against different segments as opposed to having disparate business units, [00:30:46] marketing, creative, whatever...

Phillip: [00:30:49] Oh yeah. Well, there's so the Old World... I really love this kind of a conversation because it gets us to have to touch on a bunch of different things. The Old World was you had a social team, you had an e commerce team.

Brian: [00:31:04] Right.

Phillip: [00:31:04] And I think the New World is you have a retention team and they think about retention in every channel. You have a a loyalty team, and they think about loyalty in every channel. And that changes the way that teams require access to tools and creative assets, and not just creative assets but brand assets altogether. And so maybe the evolution in the future is less about your brand guidelines being a stringent with visual examples of like "This is how our logo is used," or "This is how our product is used," or "This is how product is is displayed." And then you have sort of a dam that has blessed images in it. But rather starting points for prompt engineering that allows and provides some guidelines within the brand. You can tell the AI what the brand book is. [00:32:09] Why do we need humans to sit in and give perspective on what is on brand and what is not when you could tell the AI, "This is our brand book. Follow the brand book," and then give the unlimited power of creativity to other people who are going to use it in whatever channel that you can't potentially even begin to imagine yet? [00:32:28]

Brian: [00:32:28] Right. In fact, so brand guides become algorithms...

Phillip: [00:32:32] They're already algorithms.

Brian: [00:32:34] Yes. 

Phillip: [00:32:34] They're just humans who make decisions and they're singular points of failure. And that's the thing that most people haven't figured out yet is that it's all editorialization. And this is by the way, this has come up in the last two episodes of the All In podcast. I don't want to be seen as like ripping them off or taking credit for the ideas, but the Anna Winters of the world, the tastemakers of the world, they editorialize and create and curate the Old World of the monoculture. They are making decisions based on things that seem good to them, based on prior experience, based on their positions of power, based on external influence, and who's influencing them and who's in their social circles. But they're basically yes/no decisions. They are algorithms. They just happen to be human algorithms.

Brian: [00:33:21] Yeah.

Phillip: [00:33:21] And that editorialization is something that every one of us should be able to have control over. You do it all the time already. We talked about this in Visions this year, about the way that we train algorithms and how training and algorithm is not necessarily a thing that you are prompted or forced to do, but you learn to do over time based on the kind of content that you like or engage with. And those can be micro intentions. Like I watched this video or I back scrolled to it or I liked it or I sent it to a friend or I went and looked at that person's profile, but they can also be extremely explicit. So those are implicit signals. They can be explicit like, "Don't show me more like this. I never want to see this person again," or you're searching, "I want to watch videos about home improvement." These kinds of things are explicit training of the algorithm. You are now an editor, you are Editor in Chief of your TikTok feed.

Brian: [00:34:18] It'd be really interesting for an algorithm to prompt you when you kind of go outside the way that it sees you. It's like, "Hey, this is well outside of what we normally see."

Phillip: [00:34:27] Like, "Are you sure?"

Brian: [00:34:27] Yeah, "This is outside of what we see you typically engage with. Are you actually Brian?"

Phillip: [00:34:39] {laughter} "Is this Brian? You're not acting like Brian."

Brian: [00:34:40] Yeah. "You're not acting like Brian. Is this Brian?" I feel like actually there might be some prompts that we see at some point where like it's like, "Hey, you're exploring new things you've never gone to before. Tell us more. Why are you doing this? What do you think about this? How do you feel about this?"

Phillip: [00:34:57] Let's go back to the Let's Enhance or the CLAID.ai conversation. Because Sofiia had a really deep insight about this as she took part in the OpenAI hackathon that just happened. And by her own account... We should probably just have her on the show.

Brian: [00:35:16] Yes. Agreed.

Phillip: [00:35:18] By her own account, she was one of very few people that weren't engineers like actual data hands in the AI, fingers on keyboard kind of engineers that were in the competition. But she was part of the team that got to the final round. And one of the what she called or what she described as a superpower is that these people are extremely logical and methodical and very powerful developer types that are extremely reasoned in the way that they make decisions and approach things in an analytical way. She saw this opportunity to, they do this thing called a prompt battle, like a rap battle, but for generating images through prompts alone. And she kept winning because she was able to tap into an area of imagination and creativity. And not just that she could see it or think of it, because I think everybody is capable of that, but being able to creatively find ways to describe that to the algorithm, to the AI, to manipulate the image outcome, not just for serendipity and like, "Let's see what happens when I put X in," but knowing the AI so well that she can manipulate the outcome to be what she sees in her head. That's an unbelievable skill. And if you imagine what companies like, say, Mondelez might be able to get out of the kind of creativity that would be required, there're five people right now that have to be part of a decision to make a Sour Patch Kid stand in front of the Eiffel Tower. You have to have people that are like consummating the idea, someone that writes a brief, someone that's helping sort of previs or mock it up and send it over to someone to actually model it in AI. And that has to come back and get approved. And then someone has to make sure that it goes to the right image sizes so that can become the hero banner on the website. Someone has to write the copy that goes over top of it. That path just got four people shorter.

Brian: [00:37:31] So two things. One, it sounds like Sofiia knows how to tap into her quantum brain. Two, this gets back to how we are able or how businesses need to be able to restructure. And that's not going to happen very easily. That's going to take some of these big businesses a long time. The question is, how quickly are they going to get supplanted by startups that do make these changes or can make these changes more quickly?

Phillip: [00:38:02] The supplanting is the thing that we've talked about a couple of times this year, which is is it the innovator's dilemma or the imitators dilemma? I see more and more where large companies are letting smaller upstarts and disruptors prove a market and create consumer demand. And then all they have to do is be there waiting for those companies to not to be acquired, but for them to imitate the behaviors.

Brian: [00:38:34] Speaking of imitating behaviors and a behavior that I'm not going to imitate is the VR usage in a Starbucks.

Phillip: [00:38:46] Do you guys have a VR?

Brian: [00:38:48] No. 

Phillip: [00:38:48] Do you have an Oculus?

Brian: [00:38:49] No.

Phillip: [00:38:50] Would you let your kid, at what age would you let your kids use Oculus?

Brian: [00:38:56] Now. I would let them use one now.

Phillip: [00:38:57] How old's your youngest?

Brian: [00:38:59] Youngest? He's eight.

Phillip: [00:39:01] You let your eight year old use VR?

Brian: [00:39:05] I don't think it would stay on his head very well.

Phillip: [00:39:12] {laughter} Because when I was eight years old, my mom was constantly yelling at me to move back from the TV. Now it's like, let's duct tape this thing to your frickin eyeballs. Let's get this as humanly close as you can possibly get it to your eyes.

Brian: [00:39:26] Yeah, he has a couple of eye problems, so I probably wouldn't let him use it. It's true. I'm curious to see what kind of studies we we get out of putting a screen that close to your eyes.

Phillip: [00:39:40] I hate for this whole show to be about my tweets, but I've been tweeting a lot. I was in a aStarbucks last week and I couldn't help but take a picture of a gentleman who was sitting at a table in broad daylight, in public, in full view of everyone, and with not like a single F to give in the whole world wearing an Oculus Quest 2 or Meta Quest 2, a $300 VR headset. He's literally wearing this in the middle of Starbucks with both of the paddles on a travel desk. Have you ever seen these like, you know, the desk that you get with like the beanbag on the bottom of it that you can sit in bed.

Brian: [00:40:23] Yeah of course.

Phillip: [00:40:23] And work on your desk in bed? He's got a keyboard on this lap desk and the paddles, the VR paddles on the lap desk, but he's not using the paddles at that moment. He's like pinching in midair, moving stuff around. And I just thought to myself, I'm like, "Is this really our future? This guy looks like such a nerd."

Brian: [00:40:46] I mean, I feel like that's next level passed having two giant boxes on the back of your bike for not caring what people think.

Phillip: [00:40:55] {laughter} It's true. It's true.

Brian: [00:41:02] You're in a Starbucks in VR. That's the ultimate like just not caring how people feel about you and just doing what you want.

Phillip: [00:41:13] There was an entire like generation of popular culture media that made fun of people with Bluetooth headsets.

Brian: [00:42:18] To be fair, the people who used them early were the worst. And I remember them. They were the worst.

Phillip: [00:42:25] Well, that's where we are with VR, maybe.

Brian: [00:42:27] I know.

Phillip: [00:42:27] I don't know. It's very rare to see someone with a VR headset in public. But when you do...

Brian: [00:42:34] I don't know if I ever have.

Phillip: [00:42:37] This is my third or fourth time. I saw someone watching on a plane, a JetBlue flight to New York a few weeks ago.

Brian: [00:42:45] That makes more sense to me.

Phillip: [00:42:45] I saw someone watching a movie, what I presume is a movie, with a VR headset, with a Meta Quest 2.

Brian: [00:42:54] That makes the most sense because planes are a place where you want to go into an isolated place. You want to isolate yourself as much as possible. Maybe this actually is more commentary on Starbucks than it is on VR. Starbucks is a place that people go to isolate themselves. It's no longer a third place.

Phillip: [00:43:17] It's like not even the third place. This guy made it his fifth place.

Brian: [00:43:21] His fifth place. Yeah.

Phillip: [00:43:22] Homeboy was in another world. He was. He was somewhere else. I have to believe, though, that he was performing some kind of work. I want to believe that he was working. I don't think that he came to Starbucks with a headset...

Brian: [00:43:36] Didn't he have a tie on? He had a tie on right?

Phillip: [00:43:39] He did. Let me pull back up. That's how I remember him.

Brian: [00:43:42] This is either straight marketing plant from Meta.

Phillip: [00:43:49] I would not put it past them at this point.

Brian: [00:43:52] Yeah, or this guy is a unique character.

Phillip: [00:43:57] I mean, it could be both.

Brian: [00:44:00] If you're wearing a tie and you're in your VR workspace, there's not even a camera on you.

Phillip: [00:44:05] I don't care what people think of me, but I care enough to not do this in public.

Brian: [00:44:12] {laughter} Everyone that says that, anyone that says they don't care what people things about them...

Phillip: [00:44:15] They super care. He does have a tie on.

Brian: [00:44:17] They super care. Yes.

Phillip: [00:44:18] Super care. In this picture he is holding the paddles, but there is a mouse in a keyboard on his lap desk. Let me explain some of the issues with this very specific. This is the problem with the VR headset. So he has headphones on over the VR headset. So it's creating this crisscross on his hair, which is extremely disheveled. You cannot look cool, your hair cannot look cool with a VR strap that goes straight down the middle of your head.

Brian: [00:44:50] Also if you're leaning back when you sit and you have a tie on...

Phillip: [00:44:53] He's chilling. Yeah, he's leaning back with the tie on.

Brian: [00:44:55] You look disheveled. The tie is supposed to make you...

Phillip: [00:45:00] Yeah. He does not look comfortable. He looks the opposite of comfortable. So we have a long way to go. You don't have a VR headset. Have you used VR Very much?

Brian: [00:45:12] Yeah, yeah, yeah, I've used VR. It's fun. It's really fun. I enjoy it.

Phillip: [00:45:16] It's fun for a minute. My kids are really into it. My ten year old in particular, she's like, "I'm going on vacation." And she pulls up this game vacation simulator and she'll say, "I'm sitting on the beach."

Brian: [00:45:30] They've come a long way.

Phillip: [00:45:32] The beach us ten miles away from us.

Brian: [00:45:33] The SIMS that we had when I was a child were like, "Here's how you build a city. Here's how you build a theme park. Here's how you become a railroad tycoon." All the games we had were very top down, like you're looking down upon the world and you're building it.

Phillip: [00:45:52] Now you're just a pleb in some other reality that needs a vacation because you work too hard.

Brian: [00:45:56] Right. I felt like a king, a god, when I was building my world online.

Phillip: [00:46:02] Oh, wow. We've come so far now. We're building the future and it's very sad at that. This has been a wild ride. I want to touch on one thing at the end, which we didn't get to. We always leave the good stuff to the very end. We're not going to get into it very much. We sometimes touch on hot button topics. And there has been a little bit of a dustup recently around Route, which is a former partner of ours here on Future Commerce. I think they sponsored the podcast, might have done a season of Step by Step.

Brian: [00:46:39] Could be a future sponsor as well.

Phillip: [00:46:41] Could be a future sponsor. So shipping insurance has become sort of a really popular thing to hate on in eCommerce Twitter, mostly led by Moiz Ali, who might be a very nice guy, but his Twitter persona is a little bit punchier than I think most people would like. Theoretically, he says things that everyone's thinking, but what I think is actually happening is there's a lot of reply guys who just bandwagon onto whatever he says.

Brian: [00:47:07] He swings hard.

Phillip: [00:47:08] He swings really hard.

Brian: [00:47:10] He used to be after Yotpo. I mean, when I say used to, I think he still is.

Phillip: [00:47:16] He might still hate on Yotpo though, also a former partner and maybe current and future partner of Future Commerce.

Brian: [00:47:23] Go back and listen to the episode we did with Yotpo. I feel like they did a really nice job of talking about their situation.

Phillip: [00:47:31] Do they charge too much for their product? I think is usually the refrain is like, oh, they're greedy. It's funny because the people who are always banging on about how much people are charging for things are the same people who drive $150,000 supercars and wear $70,000 watches.

Brian: [00:47:51] And sell $15 deodorant that I replaced with $6 store brand deodorant.

Phillip: [00:47:56] Native doesn't cost $15 a stick.

Brian: [00:47:59] It is now.

Phillip: [00:48:00] No way.

Brian: [00:48:01] Have you seen inflation? You can get it on sale for $13 or $12. But the list price I think is $15 now.

Phillip: [00:48:09] Native deodorant costs $13 for a stick of deodorant?

Brian: [00:48:11] Oh, man. My Kroeger's...

Phillip: [00:48:14] That's insanity. Okay. All right. So let's get back to why I brought this up. 

Brian: [00:48:20] Back to the topic on hand.

Phillip: [00:48:20] They're hating on shipping insurance in general. And I think that there is a conversation. These things are kind of cyclical. People like to bandwagon on things. They like to hate things. I want to believe that these are not things that people a) have direct experience with for the most part, and b) like to call things out that are predatory, that they don't even understand. Generally people that are being preyed upon in our world are not eCommerce buyers. So I don't know. I have a couple of thoughts here, but I want to give you an opportunity to...

Brian: [00:49:06] I think it's stupid to hate on this. I get why the hate is happening and maybe Route, whether or not they're the ones that deserve this right now is a totally different story. But the idea of shipping insurance in my mind, yeah, it doesn't make sense for deodorant, really. But when you're talking about a different tier of purchases, I think right now we're in a situation where I was talking to a brand recently, and if they were shipping to a certain market, they knew for a fact that 10% of their stuff was going to be damaged or have issues along the way because they didn't have good shipping partners. The last mile is tough and we're talking about breakable items or or bulky items or things that need white glove service. And those last mile partners are almost certainly throwing those types of items on top of dog food in the shipping container. And so if you want your items, if you're not worried about your items getting treated like dog food, a.k.a. deodorant, fine. But if you need to make sure your items are not treated like dog food, then you should probably.

Phillip: [00:50:20] The question, I think, you could argue the reason why a service like Route should exist. I think that that makes perfect sense. Package theft is a thing. You don't need to say anything more than that. I think the question really is, is this really just a clever way of extracting a few dollars from your customer in a way that if they ever were to act on, if you've ever dealt with an insurance company, ever, you'll know that it becomes a painful and laborious process. It's incumbent on you to prove to the insurance company that something happened the way that you believe that it did. And getting your money back is usually a part time job, if not a full time job. So I think the question for me just becomes isn't Route proving that there is a need in the marketplace for solutions and probably plural solutions that give customers more reassurance that the money that they're spending with you is not in vain. It will not go to waste and that they can have trust in your brand.

Brian: [00:51:24] One hundred percent.

Phillip: [00:51:24] And if Route is the thing that closes the deal with that trust in your brand, you might need to look at yourself in the mirror and say... If removing it from your checkout does absolutely nothing, doesn't change your conversion rate, it doesn't alter the way that your customers think about you, it doesn't improve your customers experience. Then I would ask, "Why did you add it in the first place?"

Brian: [00:51:57] Right. Totally.

Phillip: [00:51:58] And then the next question is, if it just becomes value extraction for your customer, why would you give that money to someone else? Why wouldn't you want to do further business with your customer if they're already willing to spend a few extra dollars with you? So the next question then, this is the five whys, the next question is, "Is your pricing strategy appropriate and correct? Is your brand strong enough that they're going to buy from you and no matter what that price is?" Or is your brand so weak that they need additional outside validation that they're not going to get screwed over by you? These are all questions that come back to the heart and soul of the why you exist in eCommerce. This is not a Route problem. This is an eCommerce and brand issue and the trust that you have with the consumer.

Brian: [00:52:50] Agreed. 

Phillip: [00:52:50] So [00:52:50] all Route does or what any shipping insurance company is doing is creating a value extractive solution for the shortfalls or the shortcomings of your own product or brand or service or storytelling or experience. That's really what it is. It's a matter of trust. [00:53:08]

Brian: [00:53:08] Exactly. Exactly. Yes.

Phillip: [00:53:14] Well I wish you would have disagreed a little bit. {laughter}

Brian: [00:53:15] I feel this is a good place to leave it today. It is a matter of trust. Trust is paramount. In fact, we wrote a piece recently about trust in eCom with another reviews provider recently called Okendo. And I felt like that was just another proof point that trust is paramount.

Phillip: [00:53:42] I mean, trust is everything. But I don't think that trust is the thing that we believe it to be. There isn't implicit trust and there isn't even necessarily earned trust, certainly not in the first purchase. So how do you ensure trust? And that's sometimes someone willing to spend a couple extra bucks. It's a a question.

Brian: [00:54:03] Did you say ensure or insure?

Phillip: [00:54:08] {laughter} I'll leave it up to the people to decide. This has been a great episode. Thanks. Thank you all for listening. We're going to leave it there. You can find more episodes of this podcast in all Future Commerce properties, there are five of them now, and you can check them out at FutureCommerce.fm and get on our newsletter. It's all going down in the DMs. People are loving our weekly newsletter. What is the phrase, not biweekly? What is it when it's twice a week?

Brian: [00:54:37] It can be biweekly actually, but also semi weekly. But also both of those things both mean every other week.

Phillip: [00:54:45] {laughter} So every Wednesday and every Friday we catch you up on the news that you need to know. And we editorialize that to some degree and draw it back to larger happenings in the world, why people behave the way they do, how they think, why they think that way, and how those are coalescing into trends. That sort of consumer insights behavior is something that we put into a newsletter called The Senses. You can get that twice a week, Wednesday and Friday, in your inbox. For futurists only, people who are risk takers who are building the future of commerce. You can do that with us by going to FutureCommerce.fm/Subscribe.

Brian: [00:55:19] I could be wrong about semi weekly. That might actually mean twice a week all the time, but bi weekly can mean either.

Phillip: [00:55:25] Thank you. Brian's Grammar Corner is at Brian.Grammar/Corner. Go subscribe to Brian. {laughter} Thank you for listening and we'll catch you in the next episode of Future Commerce.

Brian: [00:55:40] Later.