commercetools Elevate 2024 | Dirk Hoerig | commercetools

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Dirk Hoerig

Founder

commercetools

Three insights you might have missed from theCUBE’s coverage of commercetools Elevate

Commercetools GmbH’s inaugural conference, commercetools Elevate, was an opportunity to look at how cutting-edge technologies, specifically artificial intelligence and machine learning, are impacting commerce. The event highlighted how the company — which saw a 65% growth in the Americas region last year — and its partners remain committed to simplifying and customizing the user experience through composable commerce and careful use of AI.“That’s what every end user wants … a more seamless path to purchase. That’s what brands want, as well,” said Shelly Kramer (pictured, left), principal analyst for theCUBE Research, during an analysis of the conference’s keynote presentations

Redefining the e-commerce platform landscape with advanced tech and seamless consumer experiences

While the COVID pandemic was a time most people would rather forget, it was a boon to e-commerce platforms. Now the cloud-based, headless platform, commercetools GmbH, is looking to continue that growth.“Over the last 10 years, there ha[s] been so much innovation on the consumer side,” said Dirk Hoerig (pictured), founder and chief executive officer of commercetools. “We’re now in the times of AR, of VR, of AI. There’s constant change happening to all of us on the consumer side … if you want to build this business resiliency to be able to not only adapt, but embrace that change and make an opportunity out of that, you need to gain that flexibility to constantly evolve, to constantly iterate

play_circle_outline The Resilience of Digital Commerce: Navigating Unprecedented Growth Amidst the COVID Crisis and Beyond

play_circle_outline Importance of customer user experience and constantly evolving to meet changing demands

play_circle_outline Partnership with PayPal to optimize the checkout experience and increase conversion rates

play_circle_outline Foundry solution for simplifying enterprise commerce and leveraging AI capabilities

play_circle_outline Founder's passion for building the company and positive customer feedback.

Info

Dirk Hoerig | commercetools

Dirk Hoerig

Founder commercetools

search

Rebecca Knight

>> Hello everyone, and welcome back to The Cube's Coverage of Commerce Tools Elevate here in Miami Beach, Florida. I'm your host, Rebecca Knight, along with my co-host and analyst, Shelly Kramer. Shelly, we just came from the main stage where we heard a lot of Commerce Tools executives talking. This is... They're really revolutionizing commerce today.

Shelly Kramer

>> Absolutely. Absolutely. As it should be. I mean, we're undergoing massive transformation across all industries, B2C, and so really how we consume, how we buy, how we serve our customers, all of those things are, of course, very much top of mind.

Rebecca Knight

>> These are going to be shaping the forces of our new economy. So I'd like to welcome Dirk Hoerig. He's the CEO and founder of Commerce Tools. Thank you so much for coming on here.

Rebecca Knight

>> Well, you did a great job and the keynote. I'd love you to tell our viewers, just give us a broad brush of where we are right now in the market and what you

Dirk Hoerig

>> Yeah, we've seen significant growth over the last couple of years the digital commerce market, especially then fueled by the times of COVID when everything skyrocketed, right? So you might remember the times where nobody could leave their houses anymore, and then you figured out, okay, how to get food, how do you get new clothes? So e-commerce definitely had been thriving through that to new heights. And then we saw, over the last two years, a little bit more of a normalization in the market. And most people are asking now, okay, what is growth now looking like? What is the new kind of normal? Right? And especially in '23 with interest rates going up with inflation, macro effects happening, we saw some challenges, but what we are now realizing is growth suddenly is picking up. And what that means is that in total retail, we are expecting about 4growth. But when we look on the commerce part of it on average, region by region, category by category, a bit different. But on average over the next few years, we expect a growth of 8across the industry. And that is actually pretty exciting. And we also been talking on stage about that today,

Rebecca Knight

>> And the audience agreed that was is a good number because 8especially when we come from times of hypergrowth, might seem a little bit low. But when we look at the absolute numbers, we are talking about roughly 2.trillion on incremental increase just over the next four years. And these 2 trillion is all of e-commerce globally in the year of 2017. So none of us would've said in 2017, Hey, e-commerce doesn't matter, and that's just a niche kind of trend that will go away.It already was big by then, and that's what we now expecting to grow the market just over the next four years.

Rebecca Knight

>> So it's so clear that Commerce Tools is a company that innovates with the customer in mind. I'm curious your perspective, what is driving this reversion to this new normal? Because as you said, we had this explosion during the pandemic, then things fell off a bit, but now it's picking up. What is it? What's going on right now in the customer's mind?

Dirk Hoerig

>> So from our customer's perspective, it's all about it elevating, on the one end, their user We probably have to look back over the last 10 years, there have been so much innovation on the consumer side. We saw more and more devices coming up. This is just going to about to increase. We're now in the times of AR, of VR, of AI. So there's constant change happening to all of us on the consumer side, and that is increasing the requirements that we are putting on the brands and retailers. And what this means is 15 years ago, if you had been running an e-commerce business, you didn't have to do much changes on an ongoing basis because the environment around you has changed so much. Now, we don't know anymore what's going on or what to expect within the next six to 12 months. Everything is just spinning faster and faster and faster. But as a company, it means you need to adapt. And if you want to build this business resiliency to be able to not only adapt but embrace that change and make an opportunity out of that, you need to gain that flexibility to constantly evolve, to constantly iterate. And now coming out of the years after COVID, there's a huge backlog on innovation sitting within the brands of retailers of things that they need to get doing, not only on the e-commerce side, when we look into the stores, right? We try to see this holistically. We talk about unified commerce because we all, as consumers out there, we don't care if I'm working on it or connecting on a tablet, on a smartphone, on my computer. In the store, we are customer and expect that everything is working seamless.

Rebecca Knight

>> We just want the not only the goods, right? We want to be understood, we want to be heard, we want that they know about our preferences, we just want to get good recommendations, and much more. And this backlog of requirements is now more and more coming to market, and that's what's also helping us to build better products and supporting our customers.

Rebecca Knight

>> Yeah. So how do you manage that? Because describing that backlog of innovation, that is something that, as a customer, would be really frustrating. Why aren't they letting me do this? Why don't they understand me? Why don't they see me and know my needs?

Dirk Hoerig

>> It sometimes looks so obvious to the outside, why are Right? So I have seen this. They must have seen that. And often, they have seen this, but we are getting back here that the technologies that you often find still today within retailers had been bought about 20, years ago. And there, these use cases didn't even exist, right? So we need to look... When we look back to 2000, if you already did a hundred million online on revenue, you probably had been a category leader within your industry. Now today, you're probably more kind of in small to medium sized businesses because just the pure scale, the requirements have changed so much, and that what has holding many of them back. So they put investments into that, and then realized we are not getting enough kind of things done. And our approach here was that 10 years later, so in 2010, we came up with the vision that the market probably needs different technologies to help them empower their digital businesses, not only to deal with the requirements that are having today, but making a future proof. And therefore, we benefited from cloud already being there at the time, so we could elaborate on cloud technologies, something that came up in the years 2008, more publicly, not as a term, but when we look at our partners like GCP from Google or AWS from Amazon so we could leverage on top of these platforms, use their scalability incorporated into our products, and give that to the customers. And then secondly, we went for a product approach that works a little bit more like little Lego bricks, right? So we have a complete solution. But within that solution, it's all composable, which means if you want to make a change to the customer experience, to a functionality, if you want to launch a new business model, we have a lot of automotive manufacturers that started to inject our commerce platform into the cars automatically, so if you want to do all of these kind of things, it makes it way easier, way faster, way simpler.

Rebecca Knight

>> Well, and I think that that addresses a couple of things. I think there's a shortage of highly skilled tech talent, right? And so being able to have your tech teams use these kind of platforms and use these Lego bricks and have it all be... The key theme that came out of every bit of the keynote was simplicity at every level, really listening to and serving customers. And I think that there's such an opportunity here for a competitive advantage because from a consumer standpoint, we have very limited amount of patients. And so if in our shopping experience, what happens? We expect personalization at scale. We expect an omni-channel experience. If you are, as a retailer, not serving those things up, we're not going to wait around. And then you've got social media and you've got the fact that we're always on it. We're always shopping. You are scrolling through TikTok or Facebook or whatever. And so being able to be there and meet customers where they are in highly personalized way, in extremely efficient ways, all of that is the key to success

Dirk Hoerig

>> I fully agree, right? So we are in the times where attention span on all of us,-

Rebecca Knight

>> Goldfish....

Dirk Hoerig

>> very small. It's very fast. Yeah, and goldfish, you say. And it's just when something is not working to your level of standards and your expectations, the second the next vendor.

Rebecca Knight

>> Because you know there is another one. You know what I'm saying? At our fingertips are the options that we have, and we know how to find them. And I think part of it too is a message that you send as a vendor. When you don't serve up an amazing experience, you send a message to a customer that you're not that important to me. And I'm sure it's not the message you really intend to send, but it's like, you know what, as a customer, it's like, okay, next.

Dirk Hoerig

>> Fully agree.

Shelly Kramer

>> Yeah.

Rebecca Knight

>> So we had Frank Keller here on our show earlier today. He's the EVP at PayPal. Can you tell our viewers a little bit about this expanded partnership with PayPal and

Dirk Hoerig

>> Commerce Tools already had been partners for a couple of years, especially on the PayPal payment side and the Braintree integrations. And what we always have been looking for is, how can we optimize the checkout experience? Checkout matters. We believe that we probably the best performing card and checkout in the industry also by volume, and payment is a crucial component of it. And payment is coming from the partners. PayPal is one of many. And for us, it was specifically interesting when PayPal started to innovate more than a year ago across their checkout experience when they are integrated into our solution, and then the solutions of our customers, and then especially when they came up with a new guest checkout experience. Because not everybody wants to sign up, not everybody wants to register. If you're not... Maybe if you're experiencing a brand or a retailer for the first time but you like the product, you don't have much time, you just want to buy-

Rebecca Knight

>> I'm that person.... as quickly as possible. And probably later on, you might sign up at your second purchase, and so on. And when we heard from the PayPal team that they are making significantly investments into that, we started the conversation last year and said, okay, how can we provide that in a fast way to our customers? Because at the end, it's all about conversion rate optimization from their perspective. So we been happy when Frank was joining us today on stage, and we could take our partnership to the next level and announce that the products that PayPal is about to release or the process of releasing right now will become available to all of our customers soon.

Rebecca Knight

>> And what do you anticipate this will

Dirk Hoerig

>> I believe it will support our customers to grow their GMV by increasing the conversion rate. I believe that they will see less customers dropping out of the checkout process. It will just make a lot of things it frictionless, right? So it will more seamless checkout experience. I agree.

Rebecca Knight

>> Well, I think some of those drop-off numbers, was it 50that if you don't serve up an optimum experience, you're looking at a 50drop-off rate? That's a lot of money.Payment options, just having one more form, one more thing that you need to fill out with a checkout is significantly increasing the chance that somebody's dropping off. And same like in-store offline. If you have a long queue of people waiting just in front of the checkout, in front of the POS, you consider twice if it's not a brand you're specifically tied if you want to stand there. And it's what I personally... I'm not good in waiting, right? So you mentioned it before. So everything is now moving so fast. As consumers, we are not always having now these days the highest brand loyalty. Everybody has their one, two, three things that they like, and everything else is seen as a commodity. And if you then realize, okay, here, I have to wait a little bit longer than I would like to, something isn't working, they're not giving me the payment option, they're requesting more data from me that I'm willing to give in, and probably a second next somewhere else. And this is actually where we're helping our customers to further even increase already the well-performing checkout that they're having on Commerce Tools, getting that numbers even a market that's expected to grow. Commerce Tools, especially as you increase your brand recognition and growth, it a real opportunity here. What are some other things that are most exciting to you in terms of the product offerings that will differentiate Commerce Tools from competitors?

Dirk Hoerig

>> Yeah, what I am specifically exciting about is one component that we launched. It's our Foundry solution. We brought it to market early this year in January for B2C. We're launching this week Foundry for B2B on that end. And what Foundry does, it helps you to gain all the benefits that we and our partner ecosystem are providing around scalability and flexibility, but in a very simple and fast way. It's already pre-composed to their main needs and standards, because we see a lot of customers reaching out to us. We said, okay, we love to do the same that one of the other customers that they admire that having has done, but is there a best practice way that you can show us that we cannot go live in months, but already in weeks with that because we have a lot of pressure. So we had been thinking about how can we create a recipe which is not only about various kind of products that we are offering and that the partners are offering. It's about a pre-configured solution around it that we brought to market, and it makes enterprise commerce that had been complex for more than the last 20 years, significantly more simple. And one component that's that, that also makes me very excited, I think we cannot have a conversation without talking about AI, at least for a minute-

Rebecca Knight

>> We cannot....

Dirk Hoerig

>> is the abilities and capabilities that we are already getting today. And the pace of change on innovation, on AI, it's moving so fast that it's hard for all of us to follow. But we believe that when we look forward to the next two to three years and on, we will see things happening and being possible that we would have not thought before would've been possible today.

Rebecca Knight

>> And from a customer standpoint, from a developer standpoint, all of those things are, I think, very worth being excited about. to give you some props here that Mike Sharp, your chief product officer, shared some really interesting things. So you have 30 billion GNV order volume that was processed in 2023, 30 billion. Okay? More than 000 orders are processed every minute, 10 billion requests come in every week, and you have 99.995of time. Kudos to you. really amazing.

Dirk Hoerig

>> Thank you so much.

Rebecca Knight

>> A lot.

Dirk Hoerig

>> As always, taking a village to get there, right? So it's an amazing team that's making that possible. And of course, we started with smaller numbers at the beginning and also could not have thought about getting there. But when we look at the growth over the last years, I think we had been coming from 21, billion on GNV just a year before, so-

Rebecca Knight

>> Big increase....

Dirk Hoerig

>> had seen significant increase. And we are projecting to end somewhere north of 40 billion over this year, which is interesting because that already makes us, today, one of the fourth largest commerce platform providers in the world, but it feels as if we are just getting started, still early days for us.

Rebecca Knight

>> Yeah. Well, that was really clear too, that you only launched this technology in, It is relatively new. You are the founder, and also the CEO. When you think about what is next for both your company, as well as your career, do you want to stay in? Because a lot of times the technical founders maybe say, I don't know if... I want to be in the tech. I don't know if I want to do the business.What are you thinking?and what I especially love and at an event like this that we're having today is the connection with the customers and partners. I got often asked, Dirk, when you look back to the last 10 years, what are you specifically proud of? I think often, the question tends to business numbers and figures and employees, revenues, and so on. And yes, this is all impressive if you look back, but what really matters is when at an event like this here or at another random occasion, hear from a customer how much they love the product, or from the partner, how it help them to grow their business. Because also the partner ecosystem, there's more already like 300 million of volume on contracts that they are closing every year just around the ecosystem of commerce, which is also significantly growing over the last couple of When I hear about that, about 11 years ago when we launched the product, what I would have not thought about that, you just meet so many people and they say, Hey, this has changed, at least from a business perspective, completely, our life.

Shelly Kramer

>> Yeah, no, the enthusiasm is really evident here in this room. And by the way, every one of your senior executives that we've spoken with so far at the event has said the same thing. And I know that that's not rehearsed.

Dirk Hoerig

>> We haven't trained that.it's that passion for speaking with, interacting with, solving problems with customers. And I think that shows. That's very much steeped in the DNA of the Commerce tools brand.

Rebecca Knight

>> That's a great point, Shelley, because it clearly is part of the culture at Commerce Tools, this idea of we are thinking about the customer. Everything we're doing is building with the customer in mind. How do you make sure that that comes from the top down? That's your job.

Dirk Hoerig

>> Yeah, it's probably baked in from day one into our culture, right? So as we thought about creating this company and the product, we actually, at the beginning try to convince everybody else on building it because we knew how hard it is. But having 10 years on the customer side, so because we had been involved in agencies and integrators the decade before, helping customers to elaborate on the commerce technologies that had been out at the early 2000s on running the digital business, we saw the pain points that they all had, and we fed them with them. about, okay, there must be a solution to overcome these. And we also knew how hard it how long it takes to build a business like that. So therefore, our initial idea was, hey, why don't the vendors that are already out there try not to build a platform like that because then we don't need to do it, again, because we knew how much chart works. And as then saw this not working out, in 2010, we decided, okay, if nobody else is doing, then probably we have to do it. But always, therefore with this customer pain point and focus in mind, and everybody from the very first developers that we hired, the very first sales people that we hired, the very first customer success people that we on, knows the DNA of the company, where we are coming from. So you're then starting to hire like-minded people with a similar kind of vision. I think this is how the company culture is being built like that

Rebecca Knight

>> Virtuous circle. Excellent. Well, Dirk, thank you so much for coming on the show, a really fascinating and fun conversation.

Dirk Hoerig

>> Thanks for having me here.

Rebecca Knight

>> I'm Rebecca Knight for Shelly Kramer. Stay tuned for more of coverage of Commerce Tools Elevate. You're watching theCUBE, the leader in enterprise tech news.

Dirk Hoerig | commercetools

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Rebecca Knight

>> Hello everyone, and welcome back to The Cube's Coverage of Commerce Tools Elevate here in Miami Beach, Florida. I'm your host, Rebecca Knight, along with my co-host and analyst, Shelly Kramer. Shelly, we just came from the main stage where we heard a lot of Commerce Tools executives talking. This is... They're really revolutionizing commerce today.

Shelly Kramer

>> Absolutely. Absolutely. As it should be. I mean, we're undergoing massive transformation across all industries, B2C, and so really how we consume, how we buy, how we serve our customers, all of those things are, of course, very much top of mind.

Rebecca Knight

>> These are going to be shaping the forces of our new economy. So I'd like to welcome Dirk Hoerig. He's the CEO and founder of Commerce Tools. Thank you so much for coming on here.

Rebecca Knight

>> Well, you did a great job and the keynote. I'd love you to tell our viewers, just give us a broad brush of where we are right now in the market and what you

Dirk Hoerig

>> Yeah, we've seen significant growth over the last couple of years the digital commerce market, especially then fueled by the times of COVID when everything skyrocketed, right? So you might remember the times where nobody could leave their houses anymore, and then you figured out, okay, how to get food, how do you get new clothes? So e-commerce definitely had been thriving through that to new heights. And then we saw, over the last two years, a little bit more of a normalization in the market. And most people are asking now, okay, what is growth now looking like? What is the new kind of normal? Right? And especially in '23 with interest rates going up with inflation, macro effects happening, we saw some challenges, but what we are now realizing is growth suddenly is picking up. And what that means is that in total retail, we are expecting about 4growth. But when we look on the commerce part of it on average, region by region, category by category, a bit different. But on average over the next few years, we expect a growth of 8across the industry. And that is actually pretty exciting. And we also been talking on stage about that today,

Rebecca Knight

>> And the audience agreed that was is a good number because 8especially when we come from times of hypergrowth, might seem a little bit low. But when we look at the absolute numbers, we are talking about roughly 2.trillion on incremental increase just over the next four years. And these 2 trillion is all of e-commerce globally in the year of 2017. So none of us would've said in 2017, Hey, e-commerce doesn't matter, and that's just a niche kind of trend that will go away.It already was big by then, and that's what we now expecting to grow the market just over the next four years.

Rebecca Knight

>> So it's so clear that Commerce Tools is a company that innovates with the customer in mind. I'm curious your perspective, what is driving this reversion to this new normal? Because as you said, we had this explosion during the pandemic, then things fell off a bit, but now it's picking up. What is it? What's going on right now in the customer's mind?

Dirk Hoerig

>> So from our customer's perspective, it's all about it elevating, on the one end, their user We probably have to look back over the last 10 years, there have been so much innovation on the consumer side. We saw more and more devices coming up. This is just going to about to increase. We're now in the times of AR, of VR, of AI. So there's constant change happening to all of us on the consumer side, and that is increasing the requirements that we are putting on the brands and retailers. And what this means is 15 years ago, if you had been running an e-commerce business, you didn't have to do much changes on an ongoing basis because the environment around you has changed so much. Now, we don't know anymore what's going on or what to expect within the next six to 12 months. Everything is just spinning faster and faster and faster. But as a company, it means you need to adapt. And if you want to build this business resiliency to be able to not only adapt but embrace that change and make an opportunity out of that, you need to gain that flexibility to constantly evolve, to constantly iterate. And now coming out of the years after COVID, there's a huge backlog on innovation sitting within the brands of retailers of things that they need to get doing, not only on the e-commerce side, when we look into the stores, right? We try to see this holistically. We talk about unified commerce because we all, as consumers out there, we don't care if I'm working on it or connecting on a tablet, on a smartphone, on my computer. In the store, we are customer and expect that everything is working seamless.

Rebecca Knight

>> We just want the not only the goods, right? We want to be understood, we want to be heard, we want that they know about our preferences, we just want to get good recommendations, and much more. And this backlog of requirements is now more and more coming to market, and that's what's also helping us to build better products and supporting our customers.

Rebecca Knight

>> Yeah. So how do you manage that? Because describing that backlog of innovation, that is something that, as a customer, would be really frustrating. Why aren't they letting me do this? Why don't they understand me? Why don't they see me and know my needs?

Dirk Hoerig

>> It sometimes looks so obvious to the outside, why are Right? So I have seen this. They must have seen that. And often, they have seen this, but we are getting back here that the technologies that you often find still today within retailers had been bought about 20, years ago. And there, these use cases didn't even exist, right? So we need to look... When we look back to 2000, if you already did a hundred million online on revenue, you probably had been a category leader within your industry. Now today, you're probably more kind of in small to medium sized businesses because just the pure scale, the requirements have changed so much, and that what has holding many of them back. So they put investments into that, and then realized we are not getting enough kind of things done. And our approach here was that 10 years later, so in 2010, we came up with the vision that the market probably needs different technologies to help them empower their digital businesses, not only to deal with the requirements that are having today, but making a future proof. And therefore, we benefited from cloud already being there at the time, so we could elaborate on cloud technologies, something that came up in the years 2008, more publicly, not as a term, but when we look at our partners like GCP from Google or AWS from Amazon so we could leverage on top of these platforms, use their scalability incorporated into our products, and give that to the customers. And then secondly, we went for a product approach that works a little bit more like little Lego bricks, right? So we have a complete solution. But within that solution, it's all composable, which means if you want to make a change to the customer experience, to a functionality, if you want to launch a new business model, we have a lot of automotive manufacturers that started to inject our commerce platform into the cars automatically, so if you want to do all of these kind of things, it makes it way easier, way faster, way simpler.

Rebecca Knight

>> Well, and I think that that addresses a couple of things. I think there's a shortage of highly skilled tech talent, right? And so being able to have your tech teams use these kind of platforms and use these Lego bricks and have it all be... The key theme that came out of every bit of the keynote was simplicity at every level, really listening to and serving customers. And I think that there's such an opportunity here for a competitive advantage because from a consumer standpoint, we have very limited amount of patients. And so if in our shopping experience, what happens? We expect personalization at scale. We expect an omni-channel experience. If you are, as a retailer, not serving those things up, we're not going to wait around. And then you've got social media and you've got the fact that we're always on it. We're always shopping. You are scrolling through TikTok or Facebook or whatever. And so being able to be there and meet customers where they are in highly personalized way, in extremely efficient ways, all of that is the key to success

Dirk Hoerig

>> I fully agree, right? So we are in the times where attention span on all of us,-

Rebecca Knight

>> Goldfish....

Dirk Hoerig

>> very small. It's very fast. Yeah, and goldfish, you say. And it's just when something is not working to your level of standards and your expectations, the second the next vendor.

Rebecca Knight

>> Because you know there is another one. You know what I'm saying? At our fingertips are the options that we have, and we know how to find them. And I think part of it too is a message that you send as a vendor. When you don't serve up an amazing experience, you send a message to a customer that you're not that important to me. And I'm sure it's not the message you really intend to send, but it's like, you know what, as a customer, it's like, okay, next.

Dirk Hoerig

>> Fully agree.

Shelly Kramer

>> Yeah.

Rebecca Knight

>> So we had Frank Keller here on our show earlier today. He's the EVP at PayPal. Can you tell our viewers a little bit about this expanded partnership with PayPal and

Dirk Hoerig

>> Commerce Tools already had been partners for a couple of years, especially on the PayPal payment side and the Braintree integrations. And what we always have been looking for is, how can we optimize the checkout experience? Checkout matters. We believe that we probably the best performing card and checkout in the industry also by volume, and payment is a crucial component of it. And payment is coming from the partners. PayPal is one of many. And for us, it was specifically interesting when PayPal started to innovate more than a year ago across their checkout experience when they are integrated into our solution, and then the solutions of our customers, and then especially when they came up with a new guest checkout experience. Because not everybody wants to sign up, not everybody wants to register. If you're not... Maybe if you're experiencing a brand or a retailer for the first time but you like the product, you don't have much time, you just want to buy-

Rebecca Knight

>> I'm that person.... as quickly as possible. And probably later on, you might sign up at your second purchase, and so on. And when we heard from the PayPal team that they are making significantly investments into that, we started the conversation last year and said, okay, how can we provide that in a fast way to our customers? Because at the end, it's all about conversion rate optimization from their perspective. So we been happy when Frank was joining us today on stage, and we could take our partnership to the next level and announce that the products that PayPal is about to release or the process of releasing right now will become available to all of our customers soon.

Rebecca Knight

>> And what do you anticipate this will

Dirk Hoerig

>> I believe it will support our customers to grow their GMV by increasing the conversion rate. I believe that they will see less customers dropping out of the checkout process. It will just make a lot of things it frictionless, right? So it will more seamless checkout experience. I agree.

Rebecca Knight

>> Well, I think some of those drop-off numbers, was it 50that if you don't serve up an optimum experience, you're looking at a 50drop-off rate? That's a lot of money.Payment options, just having one more form, one more thing that you need to fill out with a checkout is significantly increasing the chance that somebody's dropping off. And same like in-store offline. If you have a long queue of people waiting just in front of the checkout, in front of the POS, you consider twice if it's not a brand you're specifically tied if you want to stand there. And it's what I personally... I'm not good in waiting, right? So you mentioned it before. So everything is now moving so fast. As consumers, we are not always having now these days the highest brand loyalty. Everybody has their one, two, three things that they like, and everything else is seen as a commodity. And if you then realize, okay, here, I have to wait a little bit longer than I would like to, something isn't working, they're not giving me the payment option, they're requesting more data from me that I'm willing to give in, and probably a second next somewhere else. And this is actually where we're helping our customers to further even increase already the well-performing checkout that they're having on Commerce Tools, getting that numbers even a market that's expected to grow. Commerce Tools, especially as you increase your brand recognition and growth, it a real opportunity here. What are some other things that are most exciting to you in terms of the product offerings that will differentiate Commerce Tools from competitors?

Dirk Hoerig

>> Yeah, what I am specifically exciting about is one component that we launched. It's our Foundry solution. We brought it to market early this year in January for B2C. We're launching this week Foundry for B2B on that end. And what Foundry does, it helps you to gain all the benefits that we and our partner ecosystem are providing around scalability and flexibility, but in a very simple and fast way. It's already pre-composed to their main needs and standards, because we see a lot of customers reaching out to us. We said, okay, we love to do the same that one of the other customers that they admire that having has done, but is there a best practice way that you can show us that we cannot go live in months, but already in weeks with that because we have a lot of pressure. So we had been thinking about how can we create a recipe which is not only about various kind of products that we are offering and that the partners are offering. It's about a pre-configured solution around it that we brought to market, and it makes enterprise commerce that had been complex for more than the last 20 years, significantly more simple. And one component that's that, that also makes me very excited, I think we cannot have a conversation without talking about AI, at least for a minute-

Rebecca Knight

>> We cannot....

Dirk Hoerig

>> is the abilities and capabilities that we are already getting today. And the pace of change on innovation, on AI, it's moving so fast that it's hard for all of us to follow. But we believe that when we look forward to the next two to three years and on, we will see things happening and being possible that we would have not thought before would've been possible today.

Rebecca Knight

>> And from a customer standpoint, from a developer standpoint, all of those things are, I think, very worth being excited about. to give you some props here that Mike Sharp, your chief product officer, shared some really interesting things. So you have 30 billion GNV order volume that was processed in 2023, 30 billion. Okay? More than 000 orders are processed every minute, 10 billion requests come in every week, and you have 99.995of time. Kudos to you. really amazing.

Dirk Hoerig

>> Thank you so much.

Rebecca Knight

>> A lot.

Dirk Hoerig

>> As always, taking a village to get there, right? So it's an amazing team that's making that possible. And of course, we started with smaller numbers at the beginning and also could not have thought about getting there. But when we look at the growth over the last years, I think we had been coming from 21, billion on GNV just a year before, so-

Rebecca Knight

>> Big increase....

Dirk Hoerig

>> had seen significant increase. And we are projecting to end somewhere north of 40 billion over this year, which is interesting because that already makes us, today, one of the fourth largest commerce platform providers in the world, but it feels as if we are just getting started, still early days for us.

Rebecca Knight

>> Yeah. Well, that was really clear too, that you only launched this technology in, It is relatively new. You are the founder, and also the CEO. When you think about what is next for both your company, as well as your career, do you want to stay in? Because a lot of times the technical founders maybe say, I don't know if... I want to be in the tech. I don't know if I want to do the business.What are you thinking?and what I especially love and at an event like this that we're having today is the connection with the customers and partners. I got often asked, Dirk, when you look back to the last 10 years, what are you specifically proud of? I think often, the question tends to business numbers and figures and employees, revenues, and so on. And yes, this is all impressive if you look back, but what really matters is when at an event like this here or at another random occasion, hear from a customer how much they love the product, or from the partner, how it help them to grow their business. Because also the partner ecosystem, there's more already like 300 million of volume on contracts that they are closing every year just around the ecosystem of commerce, which is also significantly growing over the last couple of When I hear about that, about 11 years ago when we launched the product, what I would have not thought about that, you just meet so many people and they say, Hey, this has changed, at least from a business perspective, completely, our life.

Shelly Kramer

>> Yeah, no, the enthusiasm is really evident here in this room. And by the way, every one of your senior executives that we've spoken with so far at the event has said the same thing. And I know that that's not rehearsed.

Dirk Hoerig

>> We haven't trained that.it's that passion for speaking with, interacting with, solving problems with customers. And I think that shows. That's very much steeped in the DNA of the Commerce tools brand.

Rebecca Knight

>> That's a great point, Shelley, because it clearly is part of the culture at Commerce Tools, this idea of we are thinking about the customer. Everything we're doing is building with the customer in mind. How do you make sure that that comes from the top down? That's your job.

Dirk Hoerig

>> Yeah, it's probably baked in from day one into our culture, right? So as we thought about creating this company and the product, we actually, at the beginning try to convince everybody else on building it because we knew how hard it is. But having 10 years on the customer side, so because we had been involved in agencies and integrators the decade before, helping customers to elaborate on the commerce technologies that had been out at the early 2000s on running the digital business, we saw the pain points that they all had, and we fed them with them. about, okay, there must be a solution to overcome these. And we also knew how hard it how long it takes to build a business like that. So therefore, our initial idea was, hey, why don't the vendors that are already out there try not to build a platform like that because then we don't need to do it, again, because we knew how much chart works. And as then saw this not working out, in 2010, we decided, okay, if nobody else is doing, then probably we have to do it. But always, therefore with this customer pain point and focus in mind, and everybody from the very first developers that we hired, the very first sales people that we hired, the very first customer success people that we on, knows the DNA of the company, where we are coming from. So you're then starting to hire like-minded people with a similar kind of vision. I think this is how the company culture is being built like that

Rebecca Knight

>> Virtuous circle. Excellent. Well, Dirk, thank you so much for coming on the show, a really fascinating and fun conversation.

Dirk Hoerig

>> Thanks for having me here.

Rebecca Knight

>> I'm Rebecca Knight for Shelly Kramer. Stay tuned for more of coverage of Commerce Tools Elevate. You're watching theCUBE, the leader in enterprise tech news.