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Monday, November 18, 2019

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Monday Eye-Opener: Dragons & Delight


by Kevin Coupe

We're coming up on the end-of-year holiday shopping season, which means lots of themed advertising designed to get people to spend money.

In the UK, that long has meant an ad from retailer John Lewis, and this year it means a combined ad from John Lewis and Waitrose - the company made the decision to combine the two brands in the advertising. Advertising Age writes that the idea was "to combine the themes combine the idea of 'thoughtful gifting' (John Lewis) and 'thoughtful hosting' (Waitrose)."

As usual, it is delightful … with elements of "Game of Thrones," with a bit of How To Train Your Dragon and maybe even a little Frozen thrown in … as it talks about friendship and compassion and "being accepting of each other's differences." Above left is the 2:30 version, which will be mined for shorter, more specific ads throughout the holidays.

All of which seems appropriate for the holidays, if more of an Eye-Opener than it should be.

Enjoy.


Amazon Extends Its Brand To PillPack Program

CNN reports that Amazon is rebranding its PillPack offering - which presorts prescriptions for patients by day and time, making it easier for people to take multiple medicines appropriately - by adding "Amazon Pharmacy" to its name.

The story notes that "the pharmaceutical industry is worth hundreds of billions of dollars and Amazon competitors Walmart, Costco and Target all have in-store pharmacies. Amazon, which has physical stores in select cities and also owns Whole Foods, doesn’t currently have in-store pharmacies." But, PillPack "has pharmacy licenses in all 50 US states" and "has been exploring other avenues for expansion into healthcare beyond the reported $753 million it paid for PillPack."

KC's View: A savvy move, I think. One of the criticisms of Amazon's private label efforts is that there are so many of them that it is hard to know which ones qualify and which ones don't. If it is going to make a major healthcare play - and the betting is that Amazon wants to be a major disruptor in that arena - then rebranding PillPack this way makes a lot of sense.

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From Zucchi...

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Starbucks' Open Restroom Policy May Hurt Store Traffic

Yahoo Finance reports on a new study from the University of Texas at Dallas and Boston College, saying that the retailer's decision to make its restrooms available to everyone - even non-customers - may be hurting foot traffic in its stores.

According to the story, "Since opening its bathroom doors to the public in the wake of a controversial incident in Philadelphia, the coffee giant has seen a 6.8% drop in store attendance per month relative to other coffee shops nearby."

The story quotes David Solomon, Assistant Professor at Boston College Carroll School of Management, as saying, “When you throw open the policy to let people come in and just use the bathrooms and the tables, maybe people come in and find the bathrooms are dirty, and the tables are crowded. And so they don't buy the coffee as well.”

Starbucks disputes the findings, saying that its numbers show that store traffic is up.

KC's View: Starbucks didn't have a lot of options, from a public relations perspective, but to open its bathrooms even to non-customers. As I recall, the decision was prompted by a store manager calling the cops on an actual customer who wanted to use the bathroom … because race was an issue in tat call, Starbucks had to defuse the situation.

I have no idea whose numbers are right. I will say this, as someone who goes to a lot of Starbucks around the country on a relatively frequent basis - even since the open door policy was announced, I generally find the Starbucks rest rooms to be clean and available - certainly a lot more pleasant than McDonald's bathrooms.

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The Market For Niche

Interesting piece in the New York Times about a small but different retailing world that "still exists on certain blocks in the East Village and on the Lower East Side, where merchants of various generations are still making, fixing or otherwise championing nostalgically tactile niche objects."

One sells pencils and erasers, and seems to thrive at least partially because people (including high school students!) are curious about such things. Another sells rubber stamps, and is just one of "three East Coast companies left who make stamps the old-fashioned way (with rubber)." And another one sells - go figure - old fashioned cash registers, for which there seems to be an appetite in some quarters.

KC's View: The point is that there seems to be room for independent, highly niche players … maybe not a lot of room, but enough for some to survive … if they are differentiated enough, and if the niche is interesting enough.

"Nostalgically tactile niche objects" is one way. Really good, highest common denominator food seems like another.

Pretty good lesson, I think.

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From WAFC...






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Campbell's CEO On Priorities, Strategy

The Philadelphia Inquirer has an interview with Campbell Soup CEO Mark Clouse in which he prognosticates about how he plans to revitalize the company.

Some excerpts:

On ingredient transparency: "I call it kitchen logic. If I see ingredients in a product that exist in my kitchen or my pantry, then I feel pretty good about it. I can pronounce them. I recognize them. I understand what they are. The pivot on health and wellness is all about unwinding processing, simplifying ingredient lines. It’s not about adding 12 things to the product. It’s really about making sure consumers know what’s in it."

On strategy: "If I didn’t say the word soup to you, if I said vegetables, if I said protein, if I said convenience, if I said value, if I told you those four attributes without saying the word soup, you’d say those are very relevant attributes for consumers today, and not just boomers or older consumers, but also for millennials and younger ones. Now, how do we take the platform of soup and make it relevant? That’s what the turnaround strategy is built upon, which is: One, let’s take the base form, which is center of the bowl, and let’s improve the relevance."

An example of what shape this might take: "“Imagine that format of a handheld cup, where the base is a bone broth that can deliver 6 to 8 grams of protein. Now imagine it flavored and infused with tea extract, so it also delivers caffeine, as an afternoon snack … This is where we are the best. There is no one that makes soup better than us.”

KC's View: Campbell has a lot of legacy on its site, but I fear we live in a world where hat matter less than ever before. The question is whether it cab be relevant and resonant to a population of young people for whom soup doesn't ideally come in a can.

The MNB Walmart Watch

• The Associated Press reports that "Walmart has agreed to change its national policy for reassigning disabled workers to settle a lawsuit brought by the U.S. Equal Employment Opportunity Commission in Maine."

Walmart has agreed "to offer disabled workers a vacant position in up to five nearby stores instead of just an employee’s current location," the story says. "Walmart also agreed to pay $80,000 to a worker who was not offered the opportunity to transfer to another store."

The lawsuit was brought on behalf of a "longtime worker who developed a disability that prevented her from continuing her job as a sales associate."

In settling the suit, Walmart did not have to admit that it did anything wrong. And, the company said that a change in its disability policies already was in the works before the lawsuit was filed.

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FastNewsBeat

Yahoo Finance reports that Kroger and Ocado have identified the location for their sixth robotics warehouse - Pleasant Prairie, Wisconsin.

Other locations have included Ohio, Florida, Georgia and Texas. The companies have said that they plan to open as many as 20 of them across the United States.


• Bimbo Bakeries USA announced on Friday "that it is committing to 100% sustainable packaging for its entire product portfolio by 2025. Through this commitment, the plastic bags, individual wrappers and cardboard boxes for more than 21 brands of bread, buns, bagels, English muffins, sweet baked goods and snacks will be recyclable, reusable or compostable by 2025."

The company said it is "the first commercial baking company in the U.S. to make this commitment."

From The MNB Politics Desk

Content Guy’s Note: Stories in this section are, in my estimation, important and relevant to business. However, they are relegated to this slot because some MNB readers have made clear that they prefer a politics-free MNB; I can't do that because sometimes the news calls out for coverage and commentary, but at least I can make it easy for folks to skip it if they so desire. And, as always, brief, occasional and sometimes gratuitous commentary is italicized…

• The New York Times over the weekend reported that in 2018, FedEx paid no federal taxes, despite the fact that a year earlier it paid $1.5 billion in taxes.

The reason: "The Trump administration’s tax cut - for which the company had lobbied hard." FedEx founder/CEO Fred Smith had championed the tax cuts, the story says, saying that they would "make the United States a better place to invest," which would lead to "a renaissance of capital investment."

However, it hasn't quite worked out that way.

From the Times story: "A New York Times analysis of data compiled by Capital IQ shows no statistically meaningful relationship between the size of the tax cut that companies and industries received and the investments they made. If anything, the companies that received the biggest tax cuts increased their capital investment by less, on average, than companies that got smaller cuts."

FedEx, the Times reports, "spent less in the 2018 fiscal year than it had projected in December 2017, before the tax law passed. It spent even less in 2019. Much of its savings have gone to reward shareholders: FedEx spent more than $2 billion on stock buybacks and dividend increases in the 2019 fiscal year, up from $1.6 billion in 2018, and more than double the amount the company spent on buybacks and dividends in fiscal year 2017."

FedEx argues that "it was unfair to judge the effect of the tax cuts on investment by looking at year-to-year changes in the company’s capital spending plans … 'FedEx invested billions in capital items eligible for accelerated depreciation and made large contributions to our employee pension plans,' the company said in a statement. 'These factors have temporarily lowered our federal income tax, which was the law’s intention to help grow G.D.P., create jobs and increase wages'."

I bring this up because it sounds a lot like a political football in the making, especially in a presidential election year. Businesses - including retailers - need to know that there may be a lot of attention paid to how much they are paying in taxes, and whether tax savings are being spent in capital investments and hiring, or on stock buybacks and investor dividends.

I'm just saying that you may need to be ready to answer the question if you are used as an example in a public policy debate. You can read the entire Times story here.

Executive Suite

• Walmart announced that Kathryn McLay, the company's Executive Vice President of Neighborhood Markets, has been named president/CEO of its Sam's Club division. McLay joined Walmart in 2015 as the Vice President of U.S. Finance and Strategy, and later was promoted to be senior vice president of supply chain.


• Ahold Delhaize-owned Stop & Shop announced that it has hired Mary Lynn Phillips as its new Senior Vice President of Finance.

The announcement says that Phillips "brings to Stop & Shop more than 30 years of experience in developing strong financial disciplines for national retailers. She most recently served as Chief Financial Officer for Stuart Weitzman in New York, New York. Phillips has also served as the Senior Vice President, Chief Financial Officer for Talbots, Inc., in Hingham, Mass., and as VP Finance and Operations of Coach’s North America Division."

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RIP

Irv Noren passed away on Friday at his California home. He was 94.

KC's View: Not sure who Irv Noren was? Me neither … which is why I found his obit in the New York Times both surprising and revealing.

Irv Noren played center field for the New York Yankees in 1952 - he was obtained by the Yankees in a trade with the Washington Senators to fill that slot in between - wait for it - Joe DiMaggio and Mickey Mantle.

DiMaggio had retired. Mantle was injured. And so the Yankees got Noren, who actually was a pretty good player - he drove in 184 runs in his first two seasons with the Senators. He also had a pretty good career - he played in 1,093 games over 11 MLB season, and had career numbers that included had 857 hits, including 157 doubles, 35 triples and 65 home runs, with 453 RBI, and a lifetime batting average of .275.

Yet, until the Times obit, I'd never heard of him. And I grew up in New York, and was an enormous Mantle fan as a kid.

I just wanted to mention Irv Noren here, because I'll bet you've never heard of him, either.

Your Views

…will return.

From The MNB Sports Desk

In National Football League play, week eleven:

NY Jets 34
Washington 17

Jacksonville 13
Indianapolis 33

Buffalo 37
Miami 20

Dallas 35
Detroit 27

Houston 7
Baltimore 41

Atlanta 29
Carolina 3

New Orleans 34
Tampa Bay 17

Denver 23
Minnesota 27

Arizona 26
San Francisco 36

New England 17
Philadelphia 10

Cincinnati 10
Oakland 17

Chicago 7
LA Rams 17

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HOW TO BE A RETAIL PIRATE: Authentic, Relevant, Resonant, Rapid, Revolutionary (ARRRR!)

A NEW PRESENTATION BY KEVIN COUPE

Steve Jobs once said, “Better to be a pirate than join the navy.” In today’s cutthroat retail environment, that attitude needs to be at the core of every business’s strategic, tactical and operational approach - challenging the status quo, doing the unexpected, creating customer-centric business initiatives and then disrupting them internally … appealing to people’s hearts and heads and aspirations … acting with piratical verve and always moving forward. In this brand new, lighthearted, illuminating and uniquely pertinent presentation, filled with examples and anecdotes and lessons, MorningNewsBeat’s Kevin Coupe brings a passion for storytelling and a unique perspective on business that will entertain and energize audiences.’’

Here’s what Lori Stillman, Executive Vice President - Analytics, Insights and Intelligence, Advantage Solutions, has to say about a recent appearance:

"Kevin joined us as a moderator and facilitator for a two-day client executive event we hosted. His role in the success of the event went far beyond his time presenting and sharing his great wisdom and content. From the moment our planning process began and we selected Kevin as a key part of our program, he dove in and worked with our team to review session topics, ideate on programming and help ensure our overall event delivered on the goals we had established. His quick wit, deep industry knowledge and ability to synthesize conversations into key take-aways enabled us to hit a home run!”

And, from Joe Jurich, CTO of DUMAC Business Systems:

”Kevin recently participated in and spoke at our Annual User Conference.  Our group consisted of independent retailers, wholesalers, and software vendors – a pretty broad group to challenge in a single talk.  While his energy, humor, and movie analogies kept the audience engaged, his ability to challenge them to think differently about how they go to market is what really captured them!  Based on dinner conversations afterward, he appeared to have left everyone thinking of at least one new approach to their strategy!”

To book Kevin for your upcoming event, click here , or call him at 203-253-0291.


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How Technology Empowers Healthcare & Selfcare: A Retail Tomorrow Podcast

Past Retail Tomorrow podcasts have focused on how technology can have an impact on business models and people's lives. In this edition, however, we drill down to talk about how technology affected one life … and, in fact, makes living a best life possible.

Our guest: Heidi Dohse, senior program manager in Google's Cloud - Health and Life Sciences division. Dohse's personal and professional story makes for a compelling narrative that is at once provocative and inspiring.

Hosted by Kevin Coupe, MorningNewsBeat’s “Content Guy."

You can listen to the podcast here, or on iTunes and GooglePlay.

This edition of the Retail Tomorrow podcast is brought to you by GMDC, the Global Market Development Center.








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