The Product Podcast

The Secrets of Instacart's AI: What’s Next for Personalized Shopping? with CPO Daniel Danker | E232

• Product School • Episode 232

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In this episode of the Product Podcast, join us for a chat with Daniel Danker, CPO at Instacart. Daniel breaks down Instacart Plus and how it’s changing the game with $0 delivery fees and lower costs. Find out how teaming up with Uber Eats has supercharged the value for members by combining grocery and restaurant deliveries into one smooth service. Daniel also talks about sticking to what you’re good at and teaming up for new stuff to keep everything top-notch.

We also dive into how AI is shaking things up at Instacart. Daniel gives us the scoop on cool features like "personal planograms" that tailor the shopping experience to what you like. Plus, we chat about how AI thinking is becoming part of everything they do, driving innovation while keeping the core product strong. Tune in to catch some great insights on leading products, keeping things simple, and how AI is changing the grocery game.

Strategic Partnerships for Enhanced Customer Value:
Form strategic partnerships that complement your services. Instacart’s collaboration with Uber Eats to integrate restaurant deliveries with grocery orders is a great example. Such partnerships can significantly enhance customer convenience and increase your value proposition.

The Importance of Membership Models:
Focus on developing robust membership models that offer tangible benefits. Instacart Plus provides perks like $0 delivery fees and reduced costs, making it attractive to users. Concentrate on your core strengths and consider partnerships to expand your service offerings efficiently.

Organizational Evolution with AI:
Integrate AI thinking across your organization rather than confining it to a single team. This fosters continuous innovation and ensures that AI-driven insights are applied to improve all aspects of the customer experience.
 
Product Leadership and the Power of Simplicity:
Practice effective product leadership by setting clear strategies, speeding up product delivery, and eliminating operational blockers. Emphasize simplicity in product development, focusing on core elements that drive success and avoiding unnecessary complexity.

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Credits:

Host: Carlos Gonzalez de Villaumbrosia
Guest: Daniel Danker

00:00 - Carlos - Product School (Host)
Welcome to the show, Daniel. I recently watched a video of you in a kitchen saying that you cook crepes for your daughters in the morning, announcing the partnership that you did with the New York Times cooking recipe, so I would love to learn more about how that story came about. 

00:26 - Daniel Danker (Host)
Yeah, it's pretty fun. You know, my daughter is in a school where she gets to learn French and I thought it'd be fun the first time to make her crepes for breakfast, and little did I realize that that would become a daily habit. Every single morning when she wakes up and I ask her what she wants for breakfast, she says she wants crepes. So it's become a daily routine in my household. I can get the first crepe out in about four minutes now, so it's lightning fast crepes. If you want some, come on over. But it also became quite funny to then turn that into an experience that we got to use to show off the partnership with New York Times Cooking, and so it's a really fun partnership that I'm happy to tell you more about. 

01:08 - Carlos - Product School (Host)
Yeah. So speaking of partnerships, I'm very curious about that New York Times Cooking. What is the business angle there? 

01:18 - Daniel Danker (Host)
Well, for many purposes, people come straight to Instacart when they want to shop. They know what they want to get, or we can help inspire them in our own app. But actually, food inspiration happens all over the place. It happens on Instacart, it happens off of Instacart, and I think New York Times Cooking is a spectacular example of a place where a lot of people find really trustworthy, high-quality recipes. I've been a New York Times Cooking customer for a long time, so it felt very natural to me. But I've been a New York Times cooking customer for a long time, so it felt very natural to me. But as we talked to more and more of our customers, they told us that they love New York Times recipes as well, and so it is a real opportunity for us to say well, this is a place that people already go, but New York Times cooking has historically been a place for discovery. 

01:59
And then what do you do? You end up having to write down all the ingredients and switch over to Instacart and type them all into search and then buy them, and that can be quite cumbersome. Well, we thought we can take the cumbersome aspects of that completely away by making it so that those recipes become shoppable and so with one button press, you end up getting the entire recipe. It switches over to Instacart, lets you buy the ingredients, lets you indicate which ones you already have, so you don't need to buy them again. So really slick. All of this is actually part of what we call the Instacart developer platform, so it's not just about enabling shopping through the other places, like New York Times Cooking, where you discover recipes or discover food, but actually making it so that a whole ecosystem can be formed around turning discovery destinations into shopping destinations. 

02:47 - Carlos - Product School (Host)
Another interesting partnership that I saw is one you've done with Uber Eats right. So now people are able to get their groceries from Instacart instantly delivered to Uber. So how are you thinking about in terms of competition, but also collaboration? 

03:07 - Daniel Danker (Host)
You know, it always comes down to what is the problem that we're trying to solve for customers, and this fits like a glove. Customers come to Instacart because they want to save time, and customers come to Instacart because they love food. Those two truths have existed since the beginning of Instacart, but sometimes customers are placing a grocery order, and sometimes they're interested in getting food delivered from a restaurant, and that's something that, when we speak with our customers, they've told us for a long time, and so we thought well, we can actually make Instacart twice as valuable for them by offering not just the biggest selection in grocery, but also thousands and thousands of restaurants nationwide that they can order from, and so the partnership felt very, very natural there, and we were able to deliver an even more high quality product as a result. It also makes the Instacart Plus membership more valuable to customers, because now not only are they getting free delivery on grocery orders, but they're also able to get free delivery on restaurant orders. So ultimately, we expect that this will create a flywheel where customers get more value from Instacart and, as a result, they come back to Instacart more frequently. 

04:14
We also think that it's very symbiotic, this relationship between placing a restaurant order and a grocery order. So a really large percentage of the customers that are placing restaurant orders are doing so immediately after having placed a grocery order. It just makes a lot of sense. The way we kind of describe it is that you get your groceries for the week and your dinner for the night. Of course, the actual scenarios go well beyond that. 

04:39 - Carlos - Product School (Host)
And I'm an early customer. I remember when Instacart got started and even the founder was literally delivering groceries and I was one of those customers that received the groceries from the founder. And obviously, looking at the story from the future, it makes sense. But I'd love to hear from your own perspective, from the inside, what was that evolution of the product from being like a single product with a very specific use case to the platform that you are talking about now? 

05:09 - Daniel Danker (Host)
It's almost a story of technology more than anything else, because grocery delivery is complicated. The catalog is extremely sophisticated. Now need to know what are all the products that people might be interested in, but we need to know what the associations are between those products. That typically, when you buy salmon, you probably want lemon to squeeze on top it obviously gets more interesting than that and also where each of those products are in the physical world right now. And what's interesting is that we've come to realize that grocery stores themselves only have a limited understanding of what's available on the shelf at any given moment. Sometimes they don't know what's physically in the store. Sometimes they know what's physically in the store but they don't know what's in the back versus what's on the shelf. And so we have not only this really sophisticated understanding of grocery and what customers want, but also how to translate that to the physical world and the stores that are around you. That's really powerful, but that's really hard to build. So, having now built that, we realized that there's way more we can do by integrating that into other services all around the country, and so you see us doing that with the developer platform. 

06:21
The other thing we've realized is that by creating this product that is a go-to product for grocery delivery. We are delivering convenience in people's lives, and that convenience is centered around food and can actually expand beyond that. So our customers actually started expecting us to do more than just pure grocery delivery. The first way that that manifested was not only through the weekly shop but through convenience orders. That happened between the weekly shop, fill-in orders, and so we started focusing a lot more on convenience and that became a really big use case on Instacart but I would argue that that's a near neighbor of grocery. 

06:55
The next thing that we did beyond that was adding more verticals, so adding Best Buy Sephora. We just launched Home Depot, so you get all these various use cases available for delivery and you get that same kind of wow, this saved my life right now. I really needed this delivered immediately and I was able to get it and I never expected that I could do that. It's really cool. So, even if some of those use cases are less frequent, we've made the Instacart membership more valuable and the Instacart app more valuable by adding those, and so restaurant delivery, of course, is a really big one, but is almost a logical extension of the journey that we've been on for quite some time now to make Instacart more valuable by delivering more convenience in more ways. 

07:39 - Carlos - Product School (Host)
So you mentioned membership a few times and I'm very, very interested in that aspect. Right, you build a marketplace where traditionally there is a transaction, you go there and you pay for what you are consuming, but you now layer this membership on top of that. So how do you think about combining those type of business models in a way that encourages retention and also unlocks additional value for the user and also unlocks additional value for the user. 

08:23
You mentioned membership a few times, so I want to dig a little deeper here. As a marketplace product, I understand that the standard business model is a transaction that someone pays when they are ordering groceries or something else. But when you think about layering a subscription on top of that, how that strategy played out in a way that encourages retention for the user but also unlocks additional value for them? 

08:58 - Daniel Danker (Host)
When we know that a customer is going to keep coming back, then we're able to unlock a lot more value for them. And that's the whole purpose of the membership and it's been very successful. Most of our orders come from members. The logical way to use Instacart if you come and use this for your weekly shop is to become a member. It pays for itself very, very quickly, but it enables us that consistency, that knowledge that this customer is going to retain and come back every single week enables us to open it way out. So not only are we able to deliver value for them in their core weekly shop, but we can add more value on through more use cases and ultimately it's that back and forth and continuous repeat use that enables us to deliver more of that value. So we really believe in the membership. We really believe that the logical way to use Instacart is to be a member and we believe that through that we can deliver the most value to customers. 

09:51 - Carlos - Product School (Host)
So what's included in the membership? You mentioned the free delivery, not just for Instacart, but now in this case is for Uber Eats delivery and how are you thinking about enhancing the value for the user as you start integrating with more partners or doing other things? 

10:10 - Daniel Danker (Host)
Yeah, the core value prop of Instacart Plus is that you get $0 delivery on your orders. We also lower fees, and so those are the core. That's the reason that most people use Instacart Plus, become members of Instacart and that's their expectation is that they're going to get that free delivery. What we're trying to do now is make the membership more and more valuable as we add more and more selection onto the platform and more use cases in the process, and so up until now, that has largely been through more frequency. That comes from convenience orders and new use cases, like I mentioned. But restaurant delivery essentially doubles the value of the membership. This is for many of our customers. They've essentially had two memberships in order to get free delivery on their grocery needs and their restaurant needs, and now they're able to do all of that with one membership. So it's a really, really big change in the value prop of Instacart Plus. 

11:08
Now our focus, of course, is to bring restaurant delivery to more and more of our customers. We just launched it. It's very nascent on the platform. It's a new way to use Instacart and so small percentage of users have placed their orders so far. The really cool thing is we're seeing that that membership is valuable for them. Most of those orders are coming from members, which is not unexpected. It's exactly what we thought would happen, but the really good news is they keep coming back. So not only are they continuing to come back for their grocery orders, but they continue to come back for restaurant orders as well. So there's repeat use there, which is the sign of product market fit that we're looking for. 

11:49
The next thing we're doing is, of course, driving that adoption across way more of our users. If I'm honest, if we weren't seeing that repeat use, we would be a little apprehensive about driving the adoption. Like all the product leaders who are listening to and watching your podcast, they know that product market fit is so crucial because it's the thing you're looking for before you drive adoption. And we've hit that. We've proven that. It's very exciting. It took a lot of work to get there and now we're going to focus on adoption. 

12:11 - Carlos - Product School (Host)
Yeah, and what you're saying reminds me, I think it's a huge moat, also against competition. Right, as you go to a single place for all your needs, you stop thinking about maintaining multiple subscriptions. It also reminds me of what Apple News did, with one single place where you can consume all your news, even if it's sports or media or technology, so you don't have to maintain some of that. The challenge that I see with that, daniel, especially at a company of your size, is that you have something that is working right, so I guess you have a core team of product people maintaining that, and then how do you go about spinning out kind of a zero to one team and ensure that they are also getting the enough resources to have a shot at being successful? 

12:52 - Daniel Danker (Host)
One of the reasons that Instacart became so successful at grocery is that we are laser focused on grocery. Every single person at Instacart wakes up every single morning trying to make the grocery experience as good as it possibly can be. So I understand your question. It's a good one. You know, when we considered doing restaurant delivery, we imagined a variety of different ways that we could do it. 

13:11
One of the options was to go at it alone and build up the selection and build up that assortment of restaurants and build up the use case from scratch at Instacart. And we ended up choosing to do this in a partnership, because we don't just want to have the best grocery, we also want to leverage really high quality restaurant delivery from a team of people who also wake up every single day obsessing about making restaurant delivery as good as it can be, and we wanted to kind of have the best of both worlds. We didn't want to get distracted by taking all of the best people at Instacart who work on grocery delivery and suddenly take them away from grocery delivery and then over time you risk having the grocery experience becoming less and less competitive. So we want it to be the best grocery delivery experience and that's why the team gets to continue to focus on that and we took this approach of a partnership and an integration that enables us to overnight have nearly all of the restaurant selection and a really sophisticated, really high quality experience from day one. 

14:12 - Carlos - Product School (Host)
Yeah, and I guess this is more of a strategic decision, right, Like you can choose what you just did, which is partnering with someone and overnight getting direct access higher speed, faster way to test if this actually works. And then you have the additional, the different approach, which is building from scratch and leveraging your existing database to try to push to a new use case. I mean it will give you more control, but ultimately it's going to slow you down. 

14:39 - Daniel Danker (Host)
That's right, and I think we need to recognize that these are very mature businesses. Today the customer's expectation around grocery delivery is really high. We have to understand so much about what customers want when they're placing their grocery orders, and I would say the same is true of restaurant delivery. So jumping into restaurant delivery and starting from scratch means having a subscale and subpar product from day one, and that's just not acceptable to us. We want to have a really excellent experience and we have that with grocery delivery. And now our customers that are coming in they're getting a world-class experience in grocery delivery and a world-class restaurant delivery experience, and they're getting that in one membership. It's really unusual to be able to achieve something like that as quickly as we were able to do it here. 

15:25 - Carlos - Product School (Host)
Another challenge that I can imagine from your perspective as a marketplace product, is you have four different players at least, right so the customer, the shopper, the retailer and even the advertiser. So, as you think about your roadmap, and how do you prioritize different initiatives to ensure that there's satisfaction across the different personas? 

15:52 - Daniel Danker (Host)
We actually have to do this balancing act around making sure that the retailers on the platform are getting what they need, that customers on the platform are getting what they need, shoppers on the platform are getting what they need and advertisers and brands are getting what they need. It actually only works the system only works when all four are getting a really good balance of impact, and that's because the customer's experience is driven by the success of all of those experiences, and I'll just give you a few examples. When the shoppers on the platform feel rewarded and feel like they're doing great work that earns them a good livelihood, then they are the face of Instacart to our customers and they end up doing a great job and they end up getting repeat use. In fact, one of the things that we often hear is the delight that our customers have when they're getting a shopper that they've had before, the delight that they have when a shopper is intuitive about, when something's out of stock, what the right thing is to get. So shoppers are extremely important to the health of the experience. 

16:47
The retailer selection is also one of the biggest draws that pulls customers into Instacart. We have the best selection by far, and that means that customers can get their mainstream needs met as well as niche needs, if you're making different food from different cultures or whatnot. We want to make sure that we have all that selection, so selection really, really matters, which means that all types of retailers need to be able to be successful. And then even the advertising is crucial to the experience, not only because it enables brands to get their products discovered, but because it makes the product more affordable, because there's multiple sources of revenue that ultimately deliver an experience to customers. 

17:27 - Carlos - Product School (Host)
Well, let's talk about this from a KPI standpoint, as you try to keep everybody happy under the same platform. What are some of the KPIs that you use for each specific persona? 

17:39 - Daniel Danker (Host)
The short answer is it's complicated. It would be lovely to choose just one KPI, something like sales, and say, well, everybody wins if sales go up. And I think that might be true in its simplest form. But actually you could make a lot of mistakes if you simply focused on sales as just one KPI. At the outset you would say more sales is good for retailers, is good for Instacart. It means that customers keep coming back, because otherwise sales wouldn't go up, and it means that advertisers will also reach more customers and the shoppers will get more demand. So in its simplest form, sales is okay as a metric, but we have quite a few other metrics. So we look at how retailers are getting customers and whether customers keep coming back to the same store. So are they having a good experience with that store or are they having a bad experience that's forcing them to keep switching stores? That's a very important metric. 

18:33
We have order level metrics that are extremely important to us. So how often were we on time? What was our actual average delivery speed? What percentage of the items that the customer chose were actually found? What's really interesting is not only is it what percentage were exact matches, but what percentage were successful replacements. When a customer goes to the store, they often encounter items that are out of stock, but they don't even realize it because you, in real time, pivot to another item. In fact, you might even in real time, pivot to another dish altogether that you're going to make because something wasn't available, but you don't really realize you're doing it, it's all. It's so automatic. Now when someone else is doing your shopping for you, it's no longer automatic, but it's actually really, really important to get right, and the found rate that we find goes way up as a result of the successful replacements that we make. So it's an extremely important metric. 

19:28
And then, finally, on the user metrics. The obvious ones would be to say user growth and user retention, but actually some of the others are really important as well. We tend to isolate metrics on new users, not just average across all of our customers, because we find that their needs are different from the customers that started using Instacart four or five years ago, and we tend to isolate different regions. So someone who's inside of an urban environment versus a more rural or suburban environment. They tend to have quite different needs, their baskets tend to be quite different, and so we isolate the metrics that way as well. All of this is in service of making sure that we don't treat our customers as one big group that is all the same, but actually recognize their unique needs and make sure that our metrics will tell us if we're doing something that's good for one set of customers but might be bad for another. 

20:19 - Carlos - Product School (Host)
I love those non-obvious metrics that are leading indicators of, ultimately, revenue success. I remember a conversation with the head of Instagram and he was talking about how they're keeping track on the amount of internal sense of videos, right Like how many people are not just liking or commenting but actually sharing that via DM with someone, because that implies that you really, really care and you want to engage in a conversation with a friend about something that you saw. 

20:46 - Daniel Danker (Host)
My favorite example of an unintuitive metric at Instacart is that customers that place an order for perishable items either produce, dairy or meat and seafood are more likely to come back on a recurring basis. 

21:01
So the easier that we can make it for customers to purchase perishable items among their first few orders, the more likely we are to turn them into retained customers. Among their first few orders, the more likely we are to turn them into retained customers, and the reason for this makes so much sense once you dig into it. If you buy something that doesn't go bad, you might not need to use the product again for a while, but if you buy something that needs to be purchased over and over again, well then you're going to keep coming back. And so you'll notice in the first experience when you first open Instacart as a new user and I do this all the time I create a new account almost at least once a week just so that I can always remember what a new customer is experiencing, not just someone who's used it for a long time and what you'll notice is the storefront is full of produce, full of dairy, full of meat and seafood. 

21:45 - Carlos - Product School (Host)
I love that, since you mentioned these kind of recipes and ways of helping a user, new or existing, to complete a transaction. I remember your talk at ProductCon San Francisco last year. You were talking about some of those specific AI use cases, so now that some time has gone by, I would love to learn more about what specifically you are doing with regards to Gen AI. 

22:12 - Daniel Danker (Host)
Yeah, I think that AI is such an exciting story for storefronts, but we're on a journey here and V1 of that journey the first version for almost every product seems to have been to create a chatbot Sound familiar and you know, if I'm honest, we learned a lot. We also created a chatbot. It's called Ask Instacart. It's a very convenient name Ask Instacart. Ai, it's kind of cool. It doesn't happen every day, but it's not the most common way that people are using Instacart the by and large people. Still, people's core behavior of using Instacart is to come in and use, buy it again the storefront and search. That's where they spend the majority of their time, and so the question for me is what does V2 look like? And it's a pretty exciting story If you look at what happens when customers go to the store. 

23:00
Today, most retail, most stores, live and die by what they call the planogram. The planogram is the internal map of all the products in the store and where they are, what shelf, how high, how many, how deep, but a regular store is forced to personalize on just one dimension, which is their location. They can't even personalize by time of day. It's not like the planogram changes by morning, afternoon, evening or night. So the personalization is that you might have a very urban store that might be more focused on younger or fitness-oriented customers, versus a more suburban store, which might be more focused on families, but that's it. That's the level of personalization you get in the store, and so what we've started asking ourselves is what does it look like when we bring this online? How do we make that better? And we call this the personal planogram, because it's all of that culmination of technology and AI that powers this personalization that's going to do things that just weren't possible in the store. 

24:03
What happens today is, when you walk into a regular store, you're actually filtering out all the products that are not interesting to you in pursuit of finding the products that are interesting to you. It's a familiar experience. It's something we do all day long. Actually, we're still doing that online as well. We often will give you back hundreds of results for something when, in fact, you're only interested in one or two of those results, and so, even online today, you're filtering out all the things you're not interested in in pursuit of the things you are interested in. Well, what we're going to do with AI is create this personal planogram where the store is rebuilt around you. It's rebuilt around the size of your household, the ages of different people in your household, their food preferences, their food restrictions and allergies and, ultimately, what you're going to see is a storefront that makes it a lot easier to use. 

24:56
So while V1 of AI might have been a chatbot and we've learned a lot from it V2 is going to be this personal planogram, this storefront that reorganizes itself around you continuously, not just once, but it keeps reorganizing itself around you as you shop. V3 might then be to actually turn Instacart into truly an agent for you, one that understands you so well that you can set it off in a direction and not even be choosing products anymore, but by telling it you know. You know already already which which dishes are on rotation in my household. So just let's just go go after those three dishes this time and we'll swap in this other dish that you've seen me make before and then just go take care of the rest for me. So that's the journey. I think we're in V2 right now, and I think it's going to really change how people experience the Instacart storefronts. 

25:45 - Carlos - Product School (Host)
I'm going to need to have you back in a few months to talk about V3. Absolutely. And then how did that Gen AI impact your current org in terms of setting up the right structure to ensure that you have the right players, that you have the right level of innovation, while also taking care of your core product? The same way we were talking about before, like launching zero to one initiatives. 

26:12 - Daniel Danker (Host)
Well, it probably follows the product story as well. V1 of our org chart with AI had a carrot AI team. It was a team that was focused on nothing but AI. V2 now has a team the whole team that uses AI and is thinking in AI all day long, so it's become a native part of our team. 

26:30
Now, if I'm being completely honest, it's actually a hybrid of the two, because in order to really unlock the personal planogram, in order to really unlock the scenarios that I just talked about, we need to build data foundations and elevate the quality of our data foundations in a way that unlocks the power of AI, meaning we need really, really accurate and continuous understanding of what customers are doing on the platform, but also we need to start understanding their profiles in a more intuitive way. You won't see us asking customers how many people are in your household. We're going to infer it based on the things that they buy and we're going to use that to create a more and more robust profile of those customers and do that, but, in return, the favor to those customers by making the experience more and more intuitive and more and more automatic for them. So that requires some data foundations that really do require a unique investment, and so that's what the AI-specific team is focused on. 

27:35 - Carlos - Product School (Host)
But then, turning that into use cases and turning that into better experiences is something that happens across the whole organization. Dan, switching gears, I want to of a lot of other shareholders like how has that influenced the way you go about leading your team and deciding what's next? 

27:56 - Daniel Danker (Host)
I'll tell you what I was worried about. I was worried that becoming a public company would cause us to make really short term decisions, quarter by quarter decisions, but I don't think that that's actually what investors want, and it's certainly not what customers want. Customers want us to build something great that they fall in love with and that stands the test of time. That gets better with time, and so I actually don't think we've made a change in how we prioritize as a result of being a public company, and my life hasn't really changed all that much either. We have a quarterly rhythm now in which we tell the world what's new and how it's all going, and that quarterly rhythm in some ways parallels our own internal metronome for knowing whether we're making progress against the things that we want to do. Like always, we've had a portfolio approach where some of the projects that we're doing are things that are meant to deliver really immediate impact and some of the things that we're doing are meant to lay the groundwork for longer term outcomes. So in that sense, that hasn't really changed. I would also say that long before we became a public company, we started operating like a public company, which, when you're working in a low margin industry that's hyper competitive, you actually need that kind of rigor regardless, and so we've had that kind of rigor regardless, and so it's not a totally unfamiliar experience now to be operating as a public company, because it requires really careful understanding of our unit economics, really careful understanding of the success of each side of the four sided marketplace. So we've always operated in that way and in that sense I think it set us up well to be a good public company as well. 

29:32 - Carlos - Product School (Host)
And you sit on the board right. Plus, you are an advisor and a board member in other startups. 

29:38 - Daniel Danker (Host)
I am on a board of another company and I advise a number of other startups. I love it because it just shows me different perspectives and different products. It's a way to kind of see how completely other companies are solving problems. So yeah, it's been a fun experience. 

29:53 - Carlos - Product School (Host)
So let's talk about the role of product on the board, because this wasn't that common back in the day. Now we have CPOs sitting next to CFOs and CROs discussing business, which is awesome because we are not just tech post sales. So, specifically, when you sit on the board, what is it that you are discussing with the other shareholders and how do you ensure that that product has actual impact on the strategic decisions for the entire company? 

30:24 - Daniel Danker (Host)
Yeah, you know, being on boards has shown me the value of asking some of the questions that we tend to ask internally when we work as product leaders. But it's just as useful working at a board level. And the first of those is what does winning look like? And it's remarkable the number of companies that have a hard time answering that question. It's not an easy question to answer. It takes a lot of real thought about who is your customer? 

30:46
What does success look like your customer? What does success look like for them? What is it that you bring that other companies might not? What are unique differentiators? And so sitting on a board asking those questions is actually just as important as asking them within the team, so isolating what winning looks like and then really interrogating whether the strategy is going to achieve that and whether you're making progress against that. And a lot of those questions really work at a product and technology level and work very well sitting alongside investors that are just as curious about those things but may not have had the vocabulary or the methodologies at their fingertips in a way that a product person probably does. 

31:30 - Carlos - Product School (Host)
Well, I want to wrap up with some of your hot takes around leadership. One of the ones I'm reading here is that the efficiency is about the streamlining processes, not just cutting cost. What do you mean by that? 

31:45 - Daniel Danker (Host)
I think that it's more fun to ship products and see impact on customers. I think that's what we're all here to do, and a lot of the efficiency that AI unlocks should enable us to do that much more quickly. A lot of the efficiencies that better processes unlock should enable us to ship products more quickly and more efficiently, spend less time managing dependencies across teams and more time working with customers and delivering for customers. So I think that shipping is a drug. I think we're all addicted to it and I think that when we talk about efficiency, what you enable, what you unlock with that is just being able to do it faster and with less overhead. I think that's exciting for everyone involved. 

32:30 - Carlos - Product School (Host)
Another one is about a fast-moving team is built on clear communication and removing blockers, not working harder. That is shocking to me because especially the two of us live in San Francisco and there's such a strong culture around working hard and working smart. So how can you actually prove that it's not just about working hard? 

32:50 - Daniel Danker (Host)
We all work hard at this point. That's a given that just comes with the territory. So, when you really distinguish what are the teams that move really fast from the ones that don't, what I often find is teams are getting stuck in ambiguity or when the goal isn't actually clear, teams are getting stuck in the glue between organizations. Teams are getting stuck because they need help but there isn't anyone around to help, and so it's not actually being able to do the job faster, it's removing the roadblocks, and so, even if you just look at this latest project, when we rolled out restaurants on Instacart, we had a very small group of very capable people, all the people that needed to be involved, whether they were on the business development side, the marketing side or the R&D side. They were all right there. 

33:39
I was involved very directly, other leaders were involved very directly, and we all understood our roles. We all understood our place, and for the leaders, it wasn't to scrutinize, it was to unblock. That's it Every single day. The morning started with how's everyone doing and how can I unblock you? And are you stuck on anything? Is anything ambiguous, and that speed of decision making and that speed of working across teams against a very, very clear goal was infectious and even though we all worked really, really hard, I think it's a project that a lot of people are going to look back on as a career highlight, because it was so easy to make progress together. 

34:17 - Carlos - Product School (Host)
One thing I find hard, even in a startup, is to really remind people of the power of simplicity. So I can only imagine when you are operating at your scale and you have so many other people, so many different priorities. What are some of the specific ways where you can bring people back to the basics and ensure that they have clarity on what they have to do next and kind of help them remove all of that noise around them? 

34:45 - Daniel Danker (Host)
It's so easy to overcomplicate the things that we're doing, and I think we have an advantage as Instacart, because the whole purpose of our product is to bring simplicity and convenience to people's lives. So that has to be part of our ethos internally as well, and so I think it is important to just keep the products as simple as possible. It's very easy in the process of building a product to add to it. It's's very easy in the process of building a product to add to it. It's also very easy in the process of iterating in a product to add to it. So actually, if you know that you will have time later to add more to it if necessary, then it's quite strategic and quite effective to start by asking the question in each product review what is it that's going to make this product successful and what are we looking at here? That is a nice to have, and that isn't core to making the product successful. 

35:36
The only thing I would say is there is one word of caution here. You probably won't hear me use the word MVP very often, because it's a very reductive word minimum viable product Is that what we're here to deliver? And I think it can really strip the delight out of products. So I don't like to use that word very much. I try to use the word simplicity simple much more than I use the word MVP, because I think you can make something that is simple but still delightful, and I think that when you use the word MVP it can kind of strip the delight out of it. So we'll go with simple but also delightful and I think it's okay to keep some of those things in there that aren't the absolute core but actually are the thing that make people fall in love with the product. 

36:14 - Carlos - Product School (Host)
Well, dan, this interview was definitely delightful. Thank you for your time to share with us how you're thinking about product AI, pricing strategy and kind of everything in between. Look forward to having you back to discuss more things when you are ready.