Astound Commerce is a company that propels revenue and relationships by developing innovative digital commerce experiences for brands. Pulse 2.0 interviewed Astound Commerce Global CEO Michael Kahn to learn more.
Michael Kahn’s Background
Kahn sees his four-decade career journey in two distinct eras: his time in advertising agency leadership when that realm existed in a traditional form and his transformation into a digital native starting in 2000. Kahn said:
“I ran startups during the birth of the web for five years before joining performance marketing agency Performics as the head of strategic account management, and I became Global CEO in 2014. During my tenure at the company, Performics grew from a team of 300 in Chicago to 3,500 in 57 countries. We also drove a six-year growth rate of more than 15 percent and operated income margins of more than 20 percent.”
“Following my time at Performics, I became Global Brand President at Digitas Worldwide, The Connected Marketing Agency. I led the expansion of the Digitas network from 27 offices in 13 countries to more than 50 offices in 30 countries, driving an international growth rate of more than 6 percent annually.”
“I found my way to Astound Commerce in 2020, and I was drawn by the quality of the work, the left-brain-leaning engineering mission of the company, and the critical digital commerce talent that it brought to its customers. I was also impressed by the fact that the work Astound does every single day drives real revenue for the clients we serve. I recognized Astound as a must-have business partner and an operation I wanted to be part of. I also saw the opportunities to build on all the company and its founders had accomplished and turn it into a global powerhouse.”
Formation Of Astound Commerce
What is Astound’s origin story? Kahn shared:
“Our founders—entrepreneurs Igor Gorin, Ilya Vinogradsky, and Roman Martynenko—were pioneers in the digital commerce space. They recognized that online shopping and experiences were going to be the future of retail, even though the age of the Internet was just beginning. Astound was founded as an e-commerce solutions provider in 2000, helping businesses navigate the dawn of the industry and thrive in a new arena.”
“As both Astound and the e-commerce industry grew, and as brands worldwide looked for digital commerce solutions, our business expanded across the globe. We understood at an early stage that the Internet would make commerce truly global, and over time, we expanded operations in North America, Europe, the Middle East, Asia, and South America.”
Favorite Memory
What has been your favorite memory working for Astound Commerce so far? Kahn reflected:
“Because we operate worldwide, I’ve had the great honor to travel and see our teams everywhere. My favorite moments are when I get to spend time with folks in town halls, have 1:1’s with key talent, and just feel the energy that exists for Astound in every market where we play.”
“One thing I’ll mention specifically is being in Kiev for a holiday party in December 2021. I got to celebrate with 600 members of our engineering and technology team—and all the people that support them—during a year-end party that was as motivating and warm as anything I have ever experienced. This was a full two months before the war in Ukraine began, and seeing the passion, energy, and commitment of our Ukrainian teammates not only left a lasting impression of their strength for Astound but for the entire country.”
Challenges Faced
What are some of the challenges Kahn has faced in growing the company? Kahn acknowledged:
“We are fortunate enough to play in a dynamic addressable market: all things digital commerce. This industry has had persistent growth since online commerce was introduced circa 2000. That said, the space is continuously evolving in terms of the technology and the solutions necessary to drive the entire range of digital commerce experiences. Our challenge is to remain at the cutting edge of solutions so that we can best help our customers – both those we have today and those we’ll work with in the future – navigate this ever-changing ecosystem.”
“What we’ve known as digital commerce in the past will dramatically change as emerging technologies like the metaverse, generative AI, AR and VR, and ChatGPT take center stage. These new tools will influence what digital experiences will look like in the near future, and what brands will need to do to prepare and meet customer expectations. We have to make sure that Astound can stay at the forefront of those areas while also supporting our talent to do really great work at scale.”
Core Products
What are Astound Commerce’s core products and features? Kahn explained:
“Astound offers solutions for just about every aspect of digital commerce. Our work consists of three core pillars: Design, Demand, and Technology. Within each of these areas, our primary focus is to spark the kind of long-term customer loyalty that drives growth for our clients.”
“Our Design services focus on creating easy-to-navigate UX and compelling content—the front-end functionalities that catch and keep a customer’s attention. Our Demand arm is centered on driving conversion by prioritizing personalization and cross-channel functionalities, making it fun and easy for customers to engage with a brand’s platform. And our Technology work is based on designing a digital ecosystem that leverages the right tools for each brand, making sure they have the correct infrastructure to support their business.”
“Everything we do is built on the foundation of strategic research and consultancy. We evaluate each company’s specific needs, along with their target customers’ preferences and behaviors, and use those insights to share recommendations for how best to enhance the customer experience and, in turn, drive revenue growth. That research then serves as the guidepost for all of the work we do with each of our clients. In summary, we offer a wide range of services that lead to sustained digital commerce growth and transformation.”
Evolution Of Astound Commerce’s Technology
How has Astound Commerce’s technology evolved since launching? Kahn noted:
“Over the years, we’ve focused on strategic acquisitions to expand our capabilities. We brought in several agencies to further specialize our offerings: Fluid, a digital customer experience agency; Groove, a digital engagement agency; and MarketForce, a leader in performance marketing services.”
“Additionally, we work closely with our technology partners, like Salesforce, to adjust our offerings as their platforms evolve. We’re keyed into their new updates and products, and we use our expertise to help our clients navigate what can be complex and ever-changing back-end technology.”
“As we continue working closely with our partners, we’ve also developed our own technologies, like our Launch360 tools that help businesses streamline and scale their digital experiences.”
Significant Milestones
What have been some of Astound Commerce’s most significant milestones? Kahn cited:
“We were founded in 2000, and we’re now 23 years old—that’s a milestone in its own right. Additionally, over our history in digital commerce, we’ve delivered over 3,000 successful projects for our customers. This incredible body of work is proof of our vast range of capabilities. We’ve also engaged with some of the biggest brands on the planet—everyone from L’Oréal to VF Corp. to PUMA, just to name a few.”
“We’ve hit many internal milestones that demonstrate the loyalty of our team. People have stayed with us through thick and thin because of the culture we’ve built and the quality of work we do. I mentioned our acquisitions, which were certainly major milestones for the business, beginning in 2017 and culminating with the MarketForce acquisition 2021. Also, in 2021, we recapitalized the company with RLH Equity Partners, a leading private equity firm that specializes in supporting founder-led professional services firms like Astound Commerce.”
“Importantly and critically, our greatest milestone is still to come as we enter our next 23 years of operation: To be the recognized global leader in digital commerce strategic services and solutions.”
Customer Success Story
Upon asking Kahn about a customer success story, he commented:
“I’m proud of all the work we do with our clients, but one, in particular, comes to mind: our long-standing partnership with Parts Town, the global leader in high-tech distribution of mission-critical equipment replacement parts and related products and services for the foodservice, residential appliance, and HVAC industries. The company has been a valued client for over 16 years, and we have been on an incredible journey together. Starting in 2007, Astound helped Parts Town launch its first website, setting a new standard in the B2B industry. Since then, we’ve worked with their team on a wide range of services, including strategy and consulting, developing new innovative features, expanding their digital presence in other countries, transitioning to a new e-commerce platform to meet their growing business needs, supporting mobile app development, entering new part categories and more. These strategic moves helped the company achieve remarkable results, with Parts Town witnessing 20 percent year-over-year organic revenue growth.”
Revenue
After asking Kahn about how the company generates revenues, he replied:
“We’re a for-profit professional services firm doing time-based commerce strategy, technology, and activation work for our customers. That could be tied to creation and delivery of a digital commerce platform, UX or UI design, or performance marketing capabilities around the experiences we bring to market. We give each customer a proposal of the solution we’re going to build, including the capabilities and teams we’ll leverage, what clouds and technologies we’ll use, and so on.”
“Ultimately, our revenue is based on the professional services we offer our customers, along with the time and costs associated with specific solutions. We drive revenue in two realms: by going out and winning new business in the marketplace and by continuing to expand relationships with our current customers. We carry forward 85-plus percent of our customers annually, which shows the strong connections we build with our clients through our work together.”
Differentiation From The Competition
What differentiates Astound Commerce from its competition? Kahn pointed out:
“First and foremost, our full-service capabilities are unparalleled—Astound is a one-stop shop for digital commerce enablement and growth. From the initial stages of strategic consulting and extensive consumer research to the implementation of cutting-edge technologies, user-friendly design, and ongoing support, our services are truly end-to-end. Our clients can trust us as a reliable partner capable of delivering integrated solutions that align with their unique business goals.”
“With over two decades of industry expertise, we’ve witnessed the evolution of online commerce and continuously adapted to stay ahead of the curve. We consider ourselves a “customer-obsessed company,” meaning we believe in taking a tailored approach for each brand based on its customers, understanding their unique needs and preferences. We have extensive expertise across industries and digital ecosystems, using our cumulative experience to bring sophisticated solutions to life.”
“Our track record speaks for itself—we’ve helped brands increase their revenue by up to 300 percent. To date, our specialists have completed more than 3,000 digital commerce projects and launched over 400 websites, building digital storefronts that generated nearly $10 billion in revenue last year alone.”
Encouraging Clients To Invest
How would you encourage clients hesitant to invest in this economy that digital commerce is an area they should be investing in right now? Kahn revealed:
“Any period of market upheaval—think the web bust in the early 2000s, the market crash in 2007, and what we’re going through right now—drives huge change and market opportunity. When you zoom out and think, “What came out of the web bust? Behemoths like Google. What came out of 2007-2008? Facebook and Apple’s introduction of the iPhone,” it throws the ebbs and flows of business into perspective.”
“Right now, we’re in another period of significant upheaval, and what’s on the cusp of taking us through? Generative AI and large language models. The truth is that in times of incredible turmoil, new opportunities in new frontiers open up. My guidance is to ask yourself: are you prepared for what will happen when the market reconstructs? Because the economy will come back, and when it does, it will usher in change. That’s transpired after every downturn in recent history. So as everyone’s pulling back on their investments and being conservative, this marketplace will turn—and if you’re not prepared for that, you’ll be left in the dust by your competitors.”
Why You Should Invest Right Now
Why should you be investing right now? Kahn responded:
“Because if you’re not, when this marketplace inevitably turns and momentum is back, then you’ll be missing out when all these new innovations scale and thrive.”
Future Company Goals
What are some of Astound Commerce’s future company goals? Kahn concluded:
“We’re living through an era of rapid technology growth, and we’re only just starting to see the full potential of emerging technologies like generative AI or AR and VR. From virtual try-on capabilities to chatbots designed to give hyper-personalized recommendations, we’re excited to explore these tools and how brands can leverage them to uplevel and scale important aspects of the digital commerce experience.”
“Additionally, we’re eager to expand our presence in new verticals. We see countless opportunities for digital transformation in industries like health and life sciences, travel and hospitality, and manufacturing. These industries have traditionally relied on outdated systems and manual processes, which can cause clunky experiences, customer frustration, and, ultimately, missed growth opportunities. Our solutions can re-imagine customer experiences in these sectors, streamlining operations and enhancing efficiency. By focusing on these up-and-coming sectors, our goal is to help companies in these spaces navigate the digital landscape, find new customers, and expand their revenue streams.”
