"Kapies was in charge of the ALDO Crew Loyalty platform.It's the global loyalty platform integrating the offline and online customer's experience. What was the biggest challenge? How the COVID19 impacted ALDO's business and how the CREW loyalty platform, implemented just in the eve of the pandemic helped to onboard way more customers to the online shop. Why Open Loyalty? How you can mix the Cloud Agnostic and Cloud Native approach, getting the best results and short time to market while avoiding the cloud's vendor lock-in." Piotr Karwatka, Host.
Tell us about yourself and career prior to ALDO.
How did you join ALDO?
Please tell us about the company itself?
What’s your role in the ALDO organization and how the IT department is organized?
How covid19 pandemic influenced the ALDO business and the Digital Transformation? In which regards it speeded things up in which it slowed it down?
Let’s talk about the challenge. What were the key goals launching this program?
How does the ALDO Crew work?
I guess it’s pretty broad - with many touch points offline/online. Who was engaged into this project or program?
ALDO’s business is super-global. Dozens of markets, apps, websites and channels. I’m wondering how you integrate all the markets, POS systems - online and offline?
What was the key challenge for you as Director of Software Development launching the program?
How does the architecture look like?
Why API-first / headless?
Cloud Native or rather cloud-agnostic?
Which elements of the architecture you decided to own vs. buy and why?
Why Open Loyalty?
How much time did it take to launch the MVP?
What did the process look like?
What’s the scale of the program?
What was the biggest challenge?
What surprised you?
Episode 28- Challenge_Kapies Vallipuram
[00:00:44] Piotr Karwatka: [00:00:44] Hello today my guest is Kapies Vallipuram Director of Software Development at Aldo Group. I'm super excited to talk with him about the Aldo Crew Loyalty program, which apparently was just a small chunk of the digital transformation challenge that Kapies was implementing. Let's get into it. Hi Kapies! Thank you for accepting my invitation.
[00:01:05] Kapies Vallipuram: [00:01:05] Thank you very much. Thanks for having me today.
[00:01:09] Piotr Karwatka: [00:01:09] That's awesome. Maybe we're gonna start with some kind of intro, if you can introduce yourself and what have you done before joining Aldo?
[00:01:21] Kapies Vallipuram: [00:01:21] So I'm looking at them going at three and a half years at Aldo. Now prior to that I worked for a Web Agency called Seedbox.
So we primarily focused on high traffic websites for our consumers. So there is where I got most of my exposure to big data prior to the data being a term. So I was working with huge databases, millions of impressions daily towards my, my last two years at the Seedbox, I started my first venture into the advertisement platform.
[00:01:53] So we had to scale in order to scale, we moved to AWS. We started building microservices and that's where my venture started.
[00:02:02] Piotr Karwatka: [00:02:02] Gotcha. So you, you dealt a lot with high scalability and big data before.
[00:02:08] Kapies Vallipuram: [00:02:08] Exactly. So coming to Aldo was in terms of data. It was a much smaller, smaller challenge.
[00:02:15] Piotr Karwatka: [00:02:15] Gotcha. So how did you join Aldo?
[00:02:18] Kapies Vallipuram: So I had a friend who worked at Aldo. His name was Jack. He was been working there for about two and a half years and he was in the midst of a SAP transformation. He told me that it was also going through a digital transformation at the same time. And they were looking to build leaders in order to build the internal team. So he reached out to me and after being CIO and few leader, key leaders in the omni-channel team, Yeah, three and a half liters years later, I'm here still here.
[00:02:46] Piotr Karwatka: [00:02:46] Gotcha. The digital transformation, was it the Crew Loyalty program we were gonna talk about in a second or was it something different?
[00:02:56] Kapies Vallipuram: [00:02:56] So the digital transformation was really moving away from monolithic e-commerce solutions, decoupling it into fashion. So that was kind of their first attempt. And based on the app, after that success, we started scaling out to different services.
[00:03:13] Piotr Karwatka: [00:03:13] Gotcha. So what was it before you started? It was a monolithic platform.
[00:03:17] Kapies Vallipuram: [00:03:17] We had a event vendor who offered all kind of the company. So it's funny e-commerce platform basically mystically the CMS, the front end portion, the backend and the, and the e-commerce engine. We found this was a bit too heavy. In terms of creating changes, the go to market was much slower. We said, okay. Yeah. What does that stop? They're good at it's good at comprehension. What do we want to focus on? We focus on a lot of clients and features allowing our business as users to enter content much more, faster, much more. This is where we focused on saying, okay, let's rebuild these components. And that's what we can do.
[00:03:55] Piotr Karwatka: [00:03:55] Gotcha. So you used to work with Composable Commerce the term becoming more and more popular. Currently, you used to work with this before it got this popularity,
[00:04:08] Kapies Vallipuram: [00:04:08] probably one of the first companies who took on this challenge town's three and a half years ago.IIt wasn't, I wouldn't say it was really recommended in the industry. Well, we knew based on our, our kind of roadblocks that this is the risk that we had to take. And now I see the last year and a half more and more companies have shifted towards this mindset.
[00:04:30] Piotr Karwatka: [00:04:30] Absolutely. I get that we should get started with maybe you going to share with us some basic info about the Aldo brand itself.
[00:04:40] I'm not sure if it's well well-known for all of them, our listeners.
[00:04:44] Kapies Vallipuram: [00:04:44] Sure. I don't think I can do justice within a few minutes, but. Albert "Aldo" Bensadoun created this company 40 years ago. It's a global, I'm sure a lot of people here with Aldo to global fashion footwear brand. We also sell handbags, jewelry.
[00:05:02] So we have three core banners under the other group. We have Global, Aldo and Call it Spring. So we are across a few countries. So North America and Europe, Asia, South America, all the contents that you can think of. Mr Bensadoun operates on three core values, which is love, respect, and integrity. And this is the core values that he's used for the last 40 years. And it's still present. And that's what I love about Aldo. I think all the people I work with, my colleagues, my peers, They all follow the same core values. And this is why we take this seriously.
[00:05:39] Piotr Karwatka: [00:05:39] Gotcha. So the culture is very, very strong.
[00:05:42] Kapies Vallipuram: [00:05:42] I think it's important for companies to grow it needs to have a strong culture.
[00:05:46] Piotr Karwatka: [00:05:46] Absolutely. If we are about we are talking about the culture, what's what's your role in the other organization and how the company is organized?
[00:05:57] Kapies Vallipuram: [00:05:57] So we went through a few shifts, I would say like any company would, our current structure is really, we have digital IT. We have platform IT, we have security for enterprise applications. So I house mainly the Digital IT portion. Along with my peers, we overseee mainly the consumer facing applications. In terms of technologies, we talking about do react to React Native. We used to have iOS applications. Currently we started our ventures into AWS serverless Java squad, two 18. So basically any application that's either our employees are using to interacti with our customers or our customers using it to interact with us.
[00:06:41] Piotr Karwatka: Gotcha. Yeah. ] So seems like many different products or projects integrated all together into this user experience. Awesome. You first said that after, after Seedbox, when you joined Aldo dev data sets you were working with were significantly smaller.I'm wondering, what does it mean? Like, what is the average number of transactions maybe, you know, not sure is the right measure, maybe traffic I mean, for the e-commerce websites per day or weekly, whatever measure you can share with us.
[00:07:19] Kapies Vallipuram: [00:07:19] I would say it's still pretty busy. I'd say our e-commerce is honestly, it's very small. I came from an ad platform where I was dealing with 400 million impressions on a daily basis. To Aldo where we're talking about maybe a hundred thousand, 200,000 visitors per day. So the data set is still big. It's just not at that scale. So we didn't really have to worry about that type of micro performance rate.
[00:07:44] Piotr Karwatka: [00:07:44] Gotcha. Absolutely. So it's, it's still a huge as for e-commerce, but comparing to the advertising, other businesses it’s just different scales. Awesome. And how about the percentage of e-commerce in the overall business? Do we have any guesses, like my, my numbers? How does number look like when you joined and right now, because I guess it's growing a lot. I mean, the e-commerce is becoming more and more significant.
[00:08:11] Kapies Vallipuram: [00:08:11] Yeah. I would say Aldo definitely was heavy or had a heavy presence in the brick and mortar. In the last few years it’s definitely seen an increase in the more and more customers. Actually, the shift started when more and more customers started going on to mobile.
So that's the phase that we noticed. We noticed most customers move away from desktop. I would say we actually, in my, in my last three years where I saw the. The curve, actually to mobile curve take over the desktop and that gap was much, much bigger. In terms of traffic, I would say e-commerce across all retail has been, always held back kind of, cause it was a big mortar experience, but with the last. Six months to nine months because the COVID we saw that it actually, people had no choice. We kind of forced them to go online. So that shift automatically happened. So we did see a huge increase. I don't have the exact percent on by hand, but we did notice it. And I think if you compare it to all the other retailers online, they've seen the same shift.
[00:09:15] Piotr Karwatka: [00:09:15] Absolutely. You said COVID-19 and I think that this is topic we, we should also discuss a little bit more, I mean it's surely dodgy business. I mean, Alto has a lot of offline shoe stores how, how it was and how how we change the way the digital transformation projects are going on at Aldo.
[00:09:37] Kapies Vallipuram: [00:09:37] Aldo was already a bit ahead of the game in terms of digital transformation, we didn't start because of COVID were we already started few years back? Definitely, it was much slower. You know, there's a lot of changes that we had to adapt to. A lot of different teams had to adjust to working from home.
[00:09:55] I would say the Digital IT team had a practice already in place. So during COVID, we did contribute to sharing this practice with our peers from across the company. And we were able to adapt really quickly, you know, using tools such as Slack, JIRA hangout, Zoom.
[00:10:11] Piotr Karwatka: [00:10:11] Gotcha. So we know it's pretty natural for you guys to do a switch to remote.
[00:10:17] Kapies Vallipuram: [00:10:17] I would say as soon as we went to COVID, the team kept delivering. So I don't think it felt different.
[00:10:22] Piotr Karwatka: [00:10:22] Yeah. Yeah. So can I say it's sped the whole process up?
[00:10:26] Kapies Vallipuram: [00:10:26] Yeah. I would say I noticed across many companies actually. The digital transformation happened over a month versus over a year?
[00:10:36] Piotr Karwatka: [00:10:36] Yeah. That's 10 times faster.
[00:10:38] Okay. So let's talk. The Aldo Crew program it’s a very interesting topic for me. I'm wondering if you can share some basics for a starter how this program actually works.
[00:10:54] Kapies Vallipuram: [00:10:54] So we launched Aldo Crew last September. [00:11:00] It’s a fully digital loyalty program it's based on it's spending based levels. So basically we have three tiers based on your spend you land on those three tiers. Why we have those tiers, because that way based on our consumer span, we can offer a different types of benefits. Franchise free shipping exclusive bundles that they only have access to a variety of things. One of the key takeaways from the other crew is it's super easy to opt in. So either within the store, they got that the POS or they comped in via the go bottle or the desktop onto a web application. So we needed to make sure that was a seamless process.
[00:11:41]The whole loyalty cycle is about a 12 month period. So that way we can actually see the customer shopping behavior over a bigger period versus like the typical loyalty programs are usually about six months and it's not often people buy shoes, right. They usually buy one or two pairs a year. So we do have a bigger range.
[00:12:03] Piotr Karwatka: [00:12:03] Gotcha. And you launch it September last year. And I think it was really, really a big lack. I can say you launched it just before COVID like nobody I was expecting, but it was apparently agreed tool to onboard those offline customers to your online shop wasn’t it?
[00:12:24] Kapies Vallipuram: [00:12:24] Right. Exactly. Exactly. So that was, we already had an omni-channel experience ongoing. This was just another tool for us to be able to connect the consumers' experience altogether. So definitely our consumers who shop online in store can go online and see their transactions. What were they, how much do they qualify for and see their benefits. So that kind of prompted users to actually engage with via the web application and in store.
[00:12:53] Piotr Karwatka: So what is the identity merging or those channels? Is it mobile phone number, or because you said they, they can join the program whatever way they like, like from offline, from online from mobile it's it's based on mobile phones and loyalty cards.
[00:13:10] Kapies Vallipuram: [00:13:10] Now their unique identifier we use, we had a few say points of entry. I think we had four numbers, but right now the popular, most popular one is email. So gotcha. So you need that in fire and that kind of trickled around all their
[00:13:26] Piotr Karwatka: [00:13:26] systems. Okay. Okay. But, but by the way, you know I'll scale so many different Catchpoint's channels implementing such a program that integrates it all together. As for me, it sounds like a huge challenge. I mean, who was engaged into this project or was it maybe a bigger than project? Maybe it was a program integrating many different projects altogether who has engaged into this implementation at Aldo. What other departments?
[00:13:56] Kapies Vallipuram: [00:13:56] That's a good, that's a good question.
[00:13:58] I'll say my two and a half years at Aldo. Besides our SAP project, I would say this is the next project that took a lot of, a lot of different teams to, to achieve this. Definitely it wasn't possible if we didn't collaborate as a company we’re talking about Store Operations, Customer Service, E-commerce, all the different technical teams in our different squads. So we had to, we're kind of had to make sure that we're able to deliver this in six months, six months
[00:14:26] Piotr Karwatka: [00:14:26].Six months? That sounds like another challenge.
[00:14:31] Kapies Vallipuram: [00:14:31] It was very aggressive, but I said, we learned a lot. The fun thing is we did deliver, would we do this again?I think we'll think about it.
[00:14:42] Piotr Karwatka: [00:14:42] that, that was good one. So the timeline the time to market was the biggest challenge you faced as a director of software development, or maybe something different?
[00:14:51] Kapies Vallipuram: [00:14:51] Definitely the, I would say the time to market was tough, especially when there's a lot of initial groundwork that needs to be done to align everyone on the program.
[00:15:01] Right. So that was happening anytime as we pulled the technical teams, Hey, start the implementation or start looking at the future. Cause we all are our needs, right. So it was a little too many moving pieces at the same time. So I would say. No, it definitely is agile, but when you have a hard date, it's kind of hard to go into agile fashion. Right? So that's kind of one of the issues we run into. Another thing is resources, you know, key players leaving myths of the project. So I stepped in for the Solution’s Architect had done, just understand what they had planned to do for the entire project. Along with my colleagues from the program manager side to the project manager side, to the POS, we worked along side by side with the technical teams to make sure they received all the support, all the guidance that they needed.
[00:15:51] Piotr Karwatka: [00:15:51] So when you have such an aggressive deadline what you just said is something like if you have such an aggressive deadline, you do whatever it takes to make it happen. You step into any role, which is which is no empty for formal and fill every gap needed.
[00:16:10] Kapies Vallipuram: [00:16:10] I think when you come together as a whole and we all play different roles, we all have put on multiple hats and we all have an end goal. So, you know, it's, it's doable. It's just that. What do you mean to make sure that we take a nice break right after that.
[00:16:24] Piotr Karwatka: [00:16:24] So. And how does the architecture look like? You're already said about the headless and API first, can we get a little bit more?
[00:16:46] Kapies Vallipuram: [00:16:46] So if I started with the loyalty engine, so the loyalty engine where it's open loyalty, it's running on EKS and AWS. So they open loyalty, provided us kind of all the images and files that we needed to deploy.
So the primary role of open loyalty in our ecosystem is actually to crunch our transactions for our customers and spit out the levels that they fall into. So we said, okay, it's an event driven ecosystem. So how can we do it? We using our existing solutions. So we have we had a DLA already in place, so okay.
[00:17:27] We said, okay, are all the transactions landing into DLA? We need to house this somewhere where open loyalty can consume them. So we created this three bucket. We pushed their open loyalty has a job that runs every few days, two times a day, once a week, crunches the data for our consumers. It's it's not the advance.
[00:17:48] To our enterprise service bus layer, where these events are propagated to different systems, which aren't listening to this when you've changed it a bit this year, huh? We, we had an MDM last year and this year we have a smaller subset MDM that we built in a serverless architecture, but either way the events are that are emitted by open loyalty.
[00:18:11] Right now are propagated to our e-commerce backend and our mini MDM. Gotcha. So I think we, we did tweak a few things along the way we noticed, like, you know, we need to make sure that to salt tolerance. So we included ASQ S between well and R and layer to make sure that we don't lose these events.
[00:18:32]Because before it was really like a synchronous. What else do we have? So, yeah, I think that was the main highlights that we, in terms of communication into open loyalty, everything goes through our enterprise service bus. When a new customer is created or do a customer in, they get registered into the commerce database.