While on a "side quest," Shopify president Harley Finkelstein told CNBC that the business, which accounts for 10% of all U.S. e-commerce transactions, needs to return to its core competency: "which is building incredible software for e-commerce."
Chief Executive Officer of Shopify Tobi Lütke had explained the choices in a note to staff, writing, "Side quests are always distracting because the company has to split focus." There are situations when this is worthwhile, such as completing the side mission improves the chances of completing the main objective.
In a pre-recorded interview for CNBC's Small Firm Playbook event last week, Finkelstein discussed his major firm and his venture, the loose-leaf tea company Firebelly Tea, which he co-founded.
He advised other retail businesses to refrain from making it their mission to emulate the success of famous personalities on platforms like YouTube (owned by Alphabet), Instagram (owned by Meta Platform), and TikTok (owned by Musical.ly) as a side income.
Invest some time into researching the subReddits and Pinterest boards where micro-influencers are active, as they may be the key to unlocking new audiences for your brand. Finkelstein claims that expanding a startup will be more cost- and time-efficient.
Finkelstein said that the traditional "Field of Dreams" approach of "If you build, it, they will come" is no longer sufficient in today's creative economy.
It is possible to have a fantastic product and yet fail. But it doesn't imply every startup should try to get MrBeast or Emma Chamberlain to endorse their product. Even though the number of people who follow a social media micro-influencer may be in the "few thousand," according to Finkelstein, the quality of their relationship with those people is high, leading to high levels of engagement. He recommends that small business owners consider all available internet personalities.
"If you're selling kitchenware or cutlery and want to find a great influencer, rather than looking for the most subscribers on YouTube, look for small channels with great engagement," said Finkelstein. "Those are the people to go after; it takes more time, but they're cheaper, and you might get a better return on investment."
When asked what he would do differently if he launched Firebelly today, Finkelstein said he would focus on finding the "small but engaged" micro-influencers responsible for constructing online communities rather than the most extensive tea and coffee influencers who were active during the pandemic when Firebelly was launched.
One technique to keep tabs on this is to monitor the micro-influencers frequency of postings across social media platforms and responses to tweets and comments.