Shopify hits the sweet spot
Legendary golf pro Arnold Palmer once described golf as deceptively simple but endlessly complicated and deeply engaging.
That may be true but when I had my first game in 20 years last week, it left me content to go another 20 years before I have another whack. While in golfing lingo I may be a complete ‘‘duffer’’, that doesn’t stop me appreciating good kit when I see it.
Tracey, whom I was playing with, is a bit of a gun and has a set of Mizuno JPX steel clubs. They are probably worth more than my house and are known for having a generous sweet spot.
In golf, the sweet spot refers to the point of the club face that, when the centre of gravity of the club head is moving towards the centre of the ball, allows the optimal energy transfer and, ideally, a stellar drive.
In business, the sweet spot refers to getting your business offer to the point where it provides the optimal balance of costs (lower) and benefits (higher). Typically this involves asking the question ‘‘what about your offer meets the needs of consumers in a way your competitors can’t replicate?’’
Last year at Nethui I asked this question: what is New Zealand’s sweet spot when it comes to technology businesses (our thirdlargest and fastest-growing export earner). I also penned a column giving my first-blush answer. Some of the answers I came up with were SaaS businesses for the SME sector, this country being a useful test-bed for global web players and a great spot to do overnight data processing for northern hemisphere companies.
This week the announcement by global e-commerce giant Shopify that they are to make Wellington the location of their first remote hub in the Oceania region opens the door to another possible future. New Zealand is a heck of a good place to base a global customer success team.
Our time zone, our version of the English language, our webiness and darn it, our friendliness, make us a great place to recruit and base customer support staff who can make raving fans out of stressed customers.
Shopify is a cloud-based e-commerce company based in Ottawa. It’s best known for its proprietary e-commerce platform stores and point-of-sales systems. They’ve got more than 650,000 merchants totting up annual gross merchandise volume of $55 billion.
Coincidentally they are also the ‘‘go-to’’ company that I recommend when retailers come to me asking about an e-commerce bolt-on.
It’s a win on many levels for Aotearoa. First for Wellington, it’s confirmation that the beer, wine and culture capital is also the digital capital of New Zealand.
Second, for the Wellington Regional Economic Development Agency (WREDA), which helped broker the deal, it’s a clear datapoint that the historically troubled agency is now getting traction and moving forward. That this happened on new chief executive Lance Walker’s watch, and not in the inaugural chief executive’s stint, is no accident.
Third, for Wellington tech companies it’s a win, because all of the new employees are ‘‘Shopify Gurus’’, Shopify’s term for customer support people. These are
Our time zone, our version of the English language, our webiness and darn it, our friendliness, make us a great place to recruit and base customer support staff who can make raving fans out of stressed customers.
people on the front line, helping entrepreneurs and businesses set up, run, and grow their business. And it will be done largely as workfrom-home roles.
That’s good news for local tech companies because they get the ecosystem benefits of a big e-commerce player, but without having to worry about them stealing their developers, database engineers and agile scrum masters. Nor, for that matter, having to compete with them for commercial property space.
It’s also good news for the region as Shopify will be recruiting more than 100 Wellingtonians over the next year. A handy boost to the local economy.
Lastly, it’s good news for Shopify because they know that they’ve hit the jackpot when it comes to having entrepreneurial personas that fit their business and local government that is fully committed.
It’s too early yet to measure that effect on the Shopify share price but the fact that the company’s shares gained over 90 per cent over the last year (well above the industry average of 8.3 per cent) suggests they’ve been tracking okay so far.
Standing back a bit, it also begs the question as to whether this could be the first of many global tech companies wanting to set up customer support shops in our benign, if a little pricey, digital banana republic.
We’ve got the ecosystem, we’ve got pretty good manners and we’re quick adopters of new technology. Also thanks to dear old Stephen Joyce’s UFB palaver, we’ve got a pretty good fibre network (so long as Chorus don’t stuff it up).
They say the secret to maximising your sweet spot in golf is limiting your playing to just a couple of courses. By contrast, if regional support offices are our digital sweet spot, there’s no reason we couldn’t see them in Timaru, Taumarunui and Tauranga.