Personalization: Retailers and brands should make serious efforts to learn more about the individuals who buy their products. Sending these customers a notification or an email based on prior purchases, for example, makes them feel that the brand has put in more effort to learn about them and will make their intent to buy higher than it would be otherwise.
As part of our series about the future of retail, I had the pleasure of interviewingSharat Potharaju, the co-founder and CEO of MobStac. MobStac is in the business of driving offline commerce and consumer engagement leveraging the mobile device. The platform helps businesses to increase footfalls, generate leads, engage with loyal customers and collect feedback.
Recognized by Forbes for helping small businesses achieve greater ROI, MobStac’s robust platform uses technologies such as WiFi, Beacons, Geofencing, near-field communication (NFC), and QR codes in conjunction with consumer mobile devices to deliver its value proposition.
With the platform’s wide adoption across various industry verticals in over 40+ countries, MobStac serves as the perfect catalyst to marry the ubiquity of the mobile device with the growing need to build online-style intelligence for the physical world.
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to learn a bit more about you. Can you tell us a story about what brought you to this specific career path?
I’ve always been excited by how entrepreneurship and technology can create impact. As the great venture capitalist Marc Andreessen says, software is eating the world.
It was during the Y2K crisis that I saw how software had penetrated every aspect of our lives. I was an undergraduate student at the time, and I realized that, if you want to nudge the world forward, technology was the best way to do that, because it’s so ubiquitous. Y2K brought home how deeply tech has penetrated every aspect of our lives. Since then, it’s only become more integral to the way we live.
This is especially true in India, where there are 500 million people under age 25. The only way to really create employment and opportunity for that many people is by finding solutions that have the potential for exponential growth. So, after working as an investment banker at Merrill Lynch, I made the leap to found my own startup, MobStac, which makes proximity marketing solutions for brands and retailers that want to connect their physical and digital worlds.
Our business has grown a huge amount since the pandemic hit, as more retailers and brands seek to create contactless experiences. Today, nearly 3,000 brands, hotels and restaurants use our technology to engage with customers and prospective customers.
Can you share the most interesting story that happened to you since you started your career?
One of the most interesting anecdotes I have is when I was invited for dinner with John Chambers, Chairman of Cisco, since they are an investor in MobStac. It was a small affair with a few select CEOs of early-stage companies around a table with him. When I walked in, John was already there waiting, and he walked up to me, said “Hey Sharat,” and knew my company, my background, about our common alma-mater in Duke, spoke about Blue Devils etc. I was simply stumped on how such a busy man had taken so much effort to understand and learn the backgrounds of each of the people he was meeting. It left an indelible impression on me: how feeling connected and finding commonalities builds respect and relationships.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson or takeaway you learned from that?
One of the funniest yet more valuable lessons from my days as a banker was when I was schooled by an associate on how I should learn to staple a bunch of papers together. He explained how the staple in the top left-hand corner needs to be at a 45 degrees angle for optimal flipping of the pages. After my initial disbelief I figured he was right and learned an important lesson on the need for attention to detail in the smallest of tasks you perform on a daily basis.
Are you working on any new exciting projects now? How do you think that might help people?
Absolutely. When Covid first hit, retailers and brands realized they needed a way to engage with consumers in a contactless way to prevent the spread of the virus. Early last year, as the pandemic spread rapidly across the world, MobStac created QR code-based menus, contact forms and other QR-centric products that enabled businesses and consumers to interact without physically touching.
For example, residential apartment complexes used our technology to create self-service visitor forms that were totally contactless. People who visited the complex would sign in digitally, using their phones, and if there was a case of Covid in the building, the business could immediately see who might have come in contact with the infected person, and send updates to all visitors who’d been in the building that day. All of this helped contain the spread of the virus.
In the early days of Covid, hundreds of businesses began using our technology for this very reason. This built an element of goodwill for our product. It allowed businesses to fully realize the potential of QR code technology — to see that it has many other applications that can create value for customers, during Covid and beyond.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
In any path you choose, to hit a certain inflection point, to achieve true escape velocity, you have to have passion and persistence.
The only way to keep seeing the light at the end of the tunnel, through the grind of your day-to-day, is to genuinely love what you do. In my experience, that’s the main driver that keeps a good business leader’s eyes on the prize when he or she isn’t seeing short-term results.
Another way to put it is: When you do what you love, you see the solution, not the problem. Otherwise, you keep hitting hurdles and you get fixated on the obstacle, not the end goal. It’s actually a great test to know whether you’re passionate about something: If you lose motivation after hitting roadblocks, then you know you don’t truly love what you do.
None of us are able to achieve success without some help along the way. Is there a particular person to whom you are grateful, who helped get you to where you are? Can you share a story?
I’m deeply grateful to my cofounder, Ravi Pratap Maddimsetty (pictured), for what he’s taught me in the 25 years I’ve known him. Ravi and I have been friends since 5th grade. We studied together in college, and lived together in New York City for many years before starting MobStac in 2010.
Ravi’s the most optimistic person I’ve ever met, and his optimism is infectious. His ability to keep looking at the path forward, rather than getting distracted by what’s immediately around him, is incredibly impressive. He’s taught me a lot from a technological perspective, too, but his capacity to prioritize his work in spite of setbacks is the most important thing I’ve learned in the two (going on three) decades I’ve known him.
How have you used your success to bring goodness to the world?
I believe you don’t need success to bring goodness to the world. Success is a moving yardstick. Goodness has to be self-evident. You have to look inward. I try to think about every single customer touchpoint, and what impact it’s creating for customers, employees and investors. It’s critical for me to make everyone feel there’s a sense of goodness that they’ve built with their relationship with the company and with me personally.
I’m tremendously proud of the team we’ve built at MobStac. I refer to former employees fondly as MobStac alumni, and they have an equal amount of pride in saying they worked for us.
In the technology world, you work with a lot of young people. For many of our employees, MobStac was the first or second job they had right out of college. That’s a great opportunity, because if you create the right mindset for these young leaders, and let them know what they’re working on goes beyond themselves, it helps them realize their true potential.
Our employees have learned so much here. Every member of our team is a smart, genuine, kind person. This is reflected in our Glassdoor reviews, which are overwhelmingly positive.
Ok super. Now let’s jump to the main questions of our interview. The Pandemic has changed many aspects of all of our lives. One of them is the fact that so many of us have gotten used to shopping almost exclusively online. Can you share a few examples of different ideas that large retail outlets are implementing to adapt to the new realities created by the Pandemic?
In the course of the past decade, many retailers haven’t done a great job integrating the offline and online worlds. Though the industry’s been harping on the importance of “omnichannel” for years, it has yet to deliver a significant omnichannel experience to consumers.
The organizations that do a good job creating one are those that can bridge the chasm separating the physical and digital worlds. It’s crucial to have multiple touchpoints for consumers, depending on what their preferences might be. One of the biggest mistakes brands and retailers make is classifying their end users in broad categories, or “buckets.” “This bucket of people typically shops in brick-and-mortar stores,” they say, “while this one shops on their mobile phone, and this one uses their desktop computers.”
In reality, the way consumers shop is much more fluid than that. People who are loyal to in-person shopping at physical stores sometimes want the ability to buy a product online. On the flip side, someone who mostly shops on mobile apps may stillwant to visit brick-and-mortar shops sometimes.
Brands and retailers have to take a more holistic view of their customers and prospects. Most companies think they have to be present in all these channels, but focus most of their attention on the one channel where they believe most of their customers are. But your app, your desktop site and your physical store all have to be seamlessly connected, or else you’re not fully capturing demand for your product.
Covid has driven this concept home for retailers, because millions of shoppers stopped going into stores in March of last year, forcing retailers to scramble to find a new way to reach people. Now, it’s crucial for retailers and brands alike to drive those customers to their online platforms, where those customers’ behaviors and preferences can be more easily understood. That helps these businesses build a direct relationship with their customers, which is key to success.
In your opinion, will retail stores or malls continue to exist? How would you articulate the role of physical retail spaces at a time when online commerce platforms like Amazon Prime or Instacart can deliver the same day or the next day?
Retail stores and malls will continue to be a part of our lives — absolutely. Technology plays a pivotal role, but there’s a reason physical stores exist that isn’t going away: Many consumers enjoy the experience of going to a store.
There’s a certain balance retailers are finding between the online and offline worlds. For example, someone shopping for a suit may visit a brick-and-mortar apparel shop to get fitted, but then go home to use the suit maker’s app to choose from a wider variety of styles, colors and patterns that weren’t stocked in-store.
That said, certain industries — like grocery, for example — may migrate almost entirely online. There’s not much difference between buying a carton of milk in a store versus buying it on your phone, especially if you already know the brand and volume of milk you want.
But for many industries, physical retail isn’t going away. It’s just changing. Businesses may not need a 20,000-square-foot space. They may only need 2,000 square feet — enough for a small physical footprint they can use to drive shoppers to their online channels.
The so-called “Retail Apocalypse” has been going on for about a decade. While many retailers are struggling, some retailers, like Lululemon, Kroger, and Costco are quite profitable. Can you share a few lessons that other retailers can learn from the success of profitable retailers?
Brands that have successfully leveraged data are the ones that will dominate the future of retail. The reason Amazon is doing so well right now is they know what consumers have been looking at, and therefore know their desires and behaviors. Companies that know those things are having an easier time adapting to change and growing profitably in spite of all the change taking place in the world.
Successful retailers know they can learn more about consumer behavior online than offline. The trick is to build an integration that nudges people from your physical space onto your digital platforms, where you can more easily understand peoples’ wants and needs. That creates a positive reinforcement loop, where retailers learn more and more about their customers and prospects, and can build increasingly sophisticated ways of targeting them.
Amazon is going to exert pressure on all of retail for the foreseeable future. New Direct-To-Consumer companies based in China are emerging that offer prices that are much cheaper than US and European brands. What would you advise to retail companies and e-commerce companies, for them to be successful in the face of such strong competition?
Every company should be building a direct relationship with their customers. Take one look at Instagram and you’ll see how ubiquitous DTC companies have become. Makers of vegan-based gourmet foods, sustainably-sourced sparkling water and other niche products are becoming more numerous by the day. That’s because the costs to advertise and easily distribute products, so they come directly to peoples’ doorsteps, have dropped dramatically.
For example, someone who bakes gluten-free cookies in Manhattan previously could only target people in New York City. The economics of that have changed so much. The combination of great delivery partners, easy-to-use social media platforms and sites like Shopify that let you create a good website relatively easily mean these kinds of companies can efficiently and affordably target people across the country. Put more concisely: The reach is so wide and the intent is so high.
So, DTC is on the rise. There’s been some backlash from people saying DTC companies can’t scale beyond a certain point, and that may be true, but many of these upstart DTC players aren’t trying to go public and make a billion dollars. So VCs may not be interested in investing in them. But they can still become thriving small- or medium-sized businesses. A vegan cookie baker could turn a 100,000 dollars business into a 1 million dollars or 10 million dollars business. The effect is that, hundreds of niche DTC cookie companies will rise where before there would have been one giant cookie company like Mondelez dominating the market.
The takeaway here is that brands can’t simply rely on retail storefronts anymore. A brick-and-mortar store won’t give you information on who bought your cookies. They’ll just say they sold a certain amount in a certain time period. A DTC model gives you much more pointed information on who your end customers are, so you can build a direct relationship with them and keep them as a customer for life.
Based on your experience and success, what are the five most important things one should know in order to create a fantastic retail experience that keeps bringing customers back for more? Please share a story or an example for each.
1. Personalization: Retailers and brands should make serious efforts to learn more about the individuals who buy their products. Sending these customers a notification or an email based on prior purchases, for example, makes them feel that the brand has put in more effort to learn about them and will make their intent to buy higher than it would be otherwise.
2. Sustainability: Consumers are increasingly concerned about the fate of the Earth. Brands and retailers that commit to sourcing their products sustainably, and can showcase that to customers, will be able to drive growth. Not using plastic, or selling products that are carbon neutral, for example, resonates with consumers and makes them more likely to buy a certain product over another that can’t make those claims.
3. Transparency: Almost every brand talks about where their product is made, since consumers have shown how much they care. If you can use technology to teach consumers more about your product, it will help them build a positive association with your brand. It makes them feel more connected to it.
You have to listen to your customers, and just as importantly, your customers have to know you’re listening. Solicit feedback from your customers, and collect it somewhere safe and easily accessible. One way to do this is to send a customer an email at the point of gratification, asking how their experience was. This makes a big difference in making customers feel you care about them.
4. Self Service: Most people want to engage with brands on their own terms and their own time. They don’t want a lot of touchpoints with a company — they want to learn about a product without having to talk to someone. They want to do it on their mobile device, for example, while sitting at home on their couch watching Netflix. Not by visiting a brick-and-mortar store or having to place a call to a customer service rep. The more retailers can allow shoppers to interact with them in a self-service manner, the better those shoppers’ experience will be.
5. Mobile-First: Mobile devices have to be integrated into your physical presence. If you want to create a powerful retail experience, you have to connect the dots between the built world and the digital one.
When someone visits a physical store to buy a product, for example, they may look at online reviews of that product on their phone while at the store. If they’re using Google to find those reviews, you don’t know where they’re going to land — on the site of a competitor, perhaps, who’s offering a lower price for a similar product.
But if you put a QR code or near-field communication tag on your in-store product, the customer can use her phone to scan the code to see reviews from your own site. So you’re choosing where they navigate. You’re controlling the experience to keep them in your ecosystem, where they’re more likely to make the decision to buy your product over a competitor’s.
Thank you for all of that. We are nearly done. Here is our final ‘meaty’ question. You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
I’m very passionate about supporting important social causes like education. But there’s not an easy way to do it, because there’s no platform that lets people efficiently and effectively find and support organizations devoted to causes they care about.
In the finance world, there’s something called a Systematic Investment Plan, or “SIP plan” for short, that lets people invest fixed, recurring amounts in mutual funds or other investment vehicles.
I would love to create an SIP plan for donating to non-profit organizations. Every month, a certain amount (that you choose) would come out of your paycheck, and go to non-profits supporting efforts that you care about.
That would be powerful because, in my experience — and in the research I’ve done — lots of people have the intent to help, and there are many experienced organizations that need the resources to do important work. But there’s no platform to match them to one another.
How can our readers further follow your work?
This was very inspiring. Thank you so much for joining us!