I had the pleasure of interviewing Shirley Chen. Shirley is the founder and CEO of Narrativ, a media technology company building a better internet for shoppers. With more than one billion links rewired, Narrativ enables partners such as New York Magazine, Ulta, and Nordstrom to tap into $25B of annual consumer spend and is on pace to deliver $600M in partner revenue this year.
Prior to founding Narrativ, Shirley led double digit growth as Head of Marketing & Business Development at Moda Operandi and was a management consultant in media and retail at McKinsey & Co. She has a Bachelor of Arts, Magna Cum Laude, from Columbia University and loves cyberpunk.
Can you tell us a story about what brought you to this specific career path?
I’m an unlikely entrepreneur — a biochemist turned Vogue intern turned McKinsey consultant turned Head of Marketing for luxury retailer Moda Operandi turned tech Founder.
At McKinsey, I worked with top media brands and learned firsthand the challenges many faced as they tried to adapt to a brave new digital world. At M’O, our drumbeat was customer growth and loyalty. Surprisingly, our most cost-effective means of acquiring new customers came when publishers reviewed our products and included an affiliate link — commerce content like Buzzfeed Reviews.
As paid search and social became more expensive, commerce content became our biggest growth channel — with two caveats. 1) Scaling was incredibly manual and 2) Content was filled with broken links (404s), out of stock items, and out of date prices that made the experience for the reader, publisher and advertiser was fundamentally broken.
My eureka moment came in a conference room in Vogue when I started to run the numbers in my head — building a functioning market in commerce content was a multi-billion dollar opportunity. Like tumor targeting nanoparticles, machine learning technology could find and repair broken links and update prices — transforming content at scale. Thus Narrativ was born!
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
Narrativ operated in stealth mode for 2 years as we built our SmartLink AI and our publisher network — our code name was “BAM.” It was a fun, punchy name that stood for “biddable affiliate media.”
As it turns out, Major League Baseball also thought it was fun and trademarked BAM before us for their in-house advertising system. We almost got served a lawsuit by the “great American pastime!” Needless to say, we came up with our new name (Narrativ) before our public launch and locked down the IP.
The lesson: do your homework and protect your best ideas. No surprise, our Smart-Link AI is now a patent-pending technology.
What do you think makes your company stand out? Can you share a story?
Narrativ stands out on the audacity of our mission and the scale of our opportunity. In June 2018, World Economic Forum honored Narrativ as a Technology Pioneer for “building renewable link technology to democratize commerce.”
One story that stands out is when our investors at NEA asked how we planned to compete in a market dominated by Facebook and Google. They were right — our technology wasn’t an incremental improvement — Now — just one year out of stealth, we will deliver $600M in partner revenue this year for the likes of Macy’s, Ulta, Dermstore, New York Magazine and many more.
It is truly humbling to join the elite company of Google, Palantir, Airbnb, Wikipedia — and while we see our market momentum as validation of product-market fit, winning the WEF award essentially represents validation of our product-society fit.
We’re not building Narrativ to make an incremental improvement to affiliate marketing — we’re building Narrativ to create a fundamentally better ecosystem for publishers, retailers and consumers.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
After I had my eureka moment at Vogue about the opportunity in commerce content, I told friends and mentors that a major publisher or tech company had to build it. One mentor (and now Narrativ advisor) straight-up called me a “coward” for not going out and just building my vision.
If I wanted to make it a better internet for shoppers a reality, I had to build it.
Are you working on any exciting projects now?
Commerce content is a rapidly growing editorial category that drives $60B of consumer spend per year. This category includes sites like the New York Times’ Wirecutter, Conde Nast’s GQ and Allure, and Buzzfeed.
That said, publishers have never been able to tie what readers are buying to what they clicked on at the product level — they’ve been data blind anytime a reader or shopper leaves their site. For commerce editors, understanding which stories and individual products actually perform can be transformational for commerce content strategy.
This fall we’re launching a new product that makes consumer trends not only available but enlightening to publishers. By providing publishers with consumer insights and data, they can write more relevant content for their readers, ultimately fulfilling our goal of helping shoppers find what they want at the best prices online.
We believe in data democratization and in data’s power to elevating the quality of service journalism online. Making product level data available to publishers requires matching products at Google-esque scale which falls outside the purview of most incumbent technology companies. Google has matched millions of product nodes for search, Narrativ is doing this for content.
How have you used your success to bring goodness to the world?
We’ve made a vested effort to use our success to promote the advancement of women in technology. My current team is 50% women and has a combined ethnic heritage from 10 different countries. I’m also proud that many of our female engineers pay it forward by volunteering their time to organizations that teach girls to code.
In a tech climate where many of the large tech platforms claim there are talent shortages that make it impossible to maintain diverse pipelines, we are leading by example to prove otherwise.
Can you share 5 examples of how retail companies will be adjusting over the next five years to the new ways that consumers like to shop?
- Successful retailers will anchor their strategy in focusing on what WON’T change
When planning for the future, Jeff Bezos wisely advises asking what won’t change in the ten years ahead.
Searches for the best have nearly doubled in the last two years, cutting across every category. Furthermore, Narrativ data shows that 44% of consumers research every purchase they buy while more than 60% of consumers research more than they used to five years ago.
I’d bet the farm on consumers continuing to research as the constant in a sea of change. Five years from now, the growth of research will make commerce content a multi-million acquisition channel for most FORTUNE 500 retailers. Retailers who focus on content now stand to reap the lion’s share of the reward.
2. The waning performance of email, social and display ads will force retailers to focus on new acquisition channels
The perfect storm of crowded platforms, consumer fatigue and GDPR is severely limiting free distribution mediums like email, search, and social; and driving more dependence on paid advertising. But the cost of ephemeral ad units continues to rise, leaving retailers desperately looking for new evergreen growth channels.
Today, the largest opportunity to acquire new customers at scale is in commerce content. Commerce content drives $25B of retail spend every year but the majority is currently locked up in hard-coded links to Amazon. In the next five years, Narrativ will unlock billions of dollars of spend for retailers in this channel, building a perfectly competitive marketplace for content akin to the market for search advertising.
Staking a claim in content will be vital to staying competitive in new mediums that emerge. In five years, the dominant acquisition and research channel may well be voice. Imagine you ask your Google Home: “Ok Google, buy me the best headphones for running” and your Home responds with a highly curated result comprising expert recommendations, consumer reviews and the most competitive price. This is the future of commerce and we believe that Narrativ is the technology infrastructure that anchors it.
3. Retailers will finally master the business of “delivering experiences”
As digitally native companies have thrived opening physical stores, we’ve solidly disproven the myth that traditional retail is dead. What is true is that mundane retail experiences are dead.
The world’s best retailers understand this and are betting big on stores of the future. It’s early to pick winners but I really like what Macy’s is doing in this space with what appears to be the first legitimate application of virtual reality in commerce.
Walmart’s Jet Black program also has the potential to be huge. Grounded in the consumer pain point of working moms being perennially short on time, JetBlack offers a concierge shopping experience that actually makes it enjoyable to buy diapers.
Here is one thing that is clear — retailers that still assault customers with bland stores and Natalie Imbruglia’s greatest hits will likely not be long for this world.
4. Retailers will take the fight to Amazon in customer acquisition, focusing on life time value over short term gains
We’ve reached an important tipping point where Amazon accounts for 50% of all online commerce. If you are selling online, you can’t just be OK with competing for the other half of the pie.
Currently, retailers obsess over the huge ROI multiples from outlets like coupon sites and retargeting, channels that are nearly meaningless in the long term. Customers that arrive via coupon websites are fickle deal-hunters who are far less likely to be repeat purchases.
As a matter of survival, retailers need to start looking for acquisition channels where bidding directly against Amazon is ROI-positive (on a customer acquisition cost basis) with an increased emphasis on high lifetime value.
Customers doing research are highly engaged and intend to purchase but still have not committed a given retailer or brand. Yet, retailers still woefully underinvest in this stage of the purchase funnel in favor of short-sighted retargeting campaigns. Expect research to overtake even point of purchase as the ultimate customer battleground.
5. Successful retailers will build moats in Omnichannel
While vastly underappreciated at the time, one of the smartest acquisitions of the decade was Best Buy’s purchase of Geek Squad. Among other brilliant strategic plays by CEO Hubert Joly, Geek Squad gave Best Buy a (temporarily) Amazon-proof connection with customers that has boosted brand loyalty and allowed it to beat expectations in one of Amazon’s strongest categories.
Long teased, advancements in identifying customers across devices will allow retailers to seamlessly combine digital and brick and mortar experiences. Shoppers reading an article about the best grills may receive an option to buy for $400 at Amazon or $380 in-store another retailer, with companies using the offset delivery cost to win on price and convenience.
On Prime Day, Home Depot smartly built omnichannel deals with additional savings on in-store pickup, a key differentiator. After all, even one-day delivery loses out to ordering something on an app and picking it up 20 minutes later down the street.
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.
We won a World Economic Forum Technology Pioneer Award this year for our technology’s ability to #EndThe404. Expect to see more on this — on the surface, fixing broken links on the internet doesn’t seem sexy but our decaying digital infrastructure threatens the fundamental promise of the internet as a source of free and accurate information.
While technology has historically been the barrier to fixing link decay at scale, the obstacle now is incomplete knowledge — both of the economic potential of repairing broken links, and of the solutions to do it. But repairing broken links is our generation’s responsibility and advancements in machine learning are finally making it possible.
Advancements in AI, IoT and other hot areas of innovation all depend on free-flowing access to data. As the fundamental connectors of data, fixing link rot is essential to powering this innovation in other fields.
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