Published on: July 16, 2015
Yesterday, we featured a "Millennial Mind" piece by Portland State University student Chelsea Ware, in which she argued that retailer loyalty programs would have to be adjusted as millennials become the center of the shopping target, since they have different priorities than "older generations" (a phrase that makes me wince).
MNB reader John Zogby wrote:Chelsea is brilliant and captures an essential ingredient of what makes Millennials tick. Like Wayne Gretsky who famously said that he always skated to where the puck was going to be not where it is, she identifies that some things are not as important to Millennials . But some things are – notably the need to be the first on the block to possess something cool and to be able to brag about it. Concert tickets, Uber gift certificates, special invitations to taste new wines and beers. These can go a long way. Retailers, pay attention.
Thanks for sharing this.
MNB user Todd Ruberg agreed:I really enjoy Chelsea’s perspective…….but yes, the “older generation” comment smarts
What is really amazing to me is how slow our industry is on taking action for the millennial demographic. We are working with companies who have been continuing to “study” it and “consider alternatives”…..instead of realizing its a significant change in the market, with more spending power than any other generation now.
Bloomberg had a great article on Subway this week…..a company in real trouble. A franchisee said “We are not cool with the millennials. We seem tired and old and its hard to break out of that”.
This generation is not that hard to understand and market to, but it will require change and ACTION. Reminds me a bit of how our industry kept “studying” the growth of the Hispanic market years ago…again, treating it like an interesting development instead of a signifiant market change requiring action. As always, there will be winners and losers here. Winners will act, losers will study, pontificate, delay…….
From another reader:I enjoyed reading Chelsea Ware’s ideas about our younger generation uses loyalty cards. This outdated utility is not limited to millennials, however. For me, using a specific retailer’s loyalty card is always an after though, made at the checkout…”Oh, yea, wait a second, I have a card.” I have about 8 on my key ring, just in case. Most don’t need to be there, because they offer phone apps or checkout entry with a phone number.
Loyalty programs should be about earning loyalty from both sides of the relationship. The retailer (or business) should be loyal to me as a regular customer, just as I am supposedly loyal to them.
Here’s a great example. The most used loyalty card on my key ring is my membership tag to Retro Fitness, my gym. Whenever I go to the gym to workout, Phil, the Manager, says to me, “Hello, Glenn. Good to see you.” Simple yes, but that is loyalty. There is no reason why grocery store managers cannot get to know the names of their best, regular customers. And, those customers should never wait in lines, either at the deli, meat counter, or especially checkout.
And another:Much like Chelsea Ware, I obtained a degree in business marketing and wound up in the CPG industry (I graduated in 2014 and joined Advantage Sales & Marketing’s “ACE Program” a month later). Additionally, I minored in music and completely agree with her idea of rewards in the form of experiences. Experiences will always be supreme to tangible things, and I think the Millennials recognize and embrace that idea.
One statement she made could not be more true about my generation; “Millennials are getting married and having children later… We have time to cultivate our interests and we take pride in doing so”. I believe that expressing how individually unique we are is the new “fitting in”. I think our generation has done a great of embracing differences, and I hope this positive trend continues in future generations.
MNB took note yesterday of a USA Today
reports that "Texas billionaire and philanthropist Sid Bass has become an investor and partner in Blue Bell Creameries, which had to shut down its factories and recall all of its products after listeria contamination of its ice cream was linked to 10 illnesses ... No details about the size of the investment were disclosed, but the story notes that "Blue Bell is extremely popular in its home state, and Bass and his family have deep ties to Fort Worth."
I commented:The key word in the description of Bass in this case is "philanthropist," because I'm simply not convinced that this brand can be saved. The name Blue Bell is forever linked with listeria, the company's feeble efforts to deal with the crisis in its early stages were noteworthy, and those empty spaces have been sitting there for a long time, reminding people of the company's issues.
MNB reader Monte Stowell wrote:Put your article about Blue Bell ice cream in your “Review File” in one year after Blue Bell ice cream comes back onto the market. I have to believe that the fine people in Texas will welcome this iconic brand back into their freezers as soon as it comes back into the marketplace. It is a Texas powerhouse brand and I think once they again put it back onto the shelves, the Texas consumer will be waiting to buy this Texas brand.
I would bet you a nice bottle of Oregon Pinot Noir that Blue Bell ice cream will be back on the shelf to stay. Are you on with this bet?
Depends on how you define "to stay." Based on recent history, that's a hard thing to quantify.
MNB reader Renee White wrote:I’m writing in response to your comments that you aren’t convinced that the Blue Bell brand can be saved, despite the investment from Sid Bass. I live in Oklahoma, less than a mile from one of Blue Bell’s plants. I am a huge fan (at the expense of my waistline) and cannot wait to get my hands on some Blue Bell Chocolate Chip Cookie Dough ice cream. You talk frequently about retailers needing to find ways to increase brand loyalty. Do you realize the significant loyalty folks in this region have to Blue Bell? There are Facebook groups (for instance, We Stand with Blue Bell) of people vowing not to eat any ice cream until Blue Bell returns. I’ve seen memes half-heartedly joking that “No Blue Bell = No Ice Cream”. People around here love Blue Bell so much, we are willing to forgive the unfortunate decisions of management during the listeria crisis, so long as we get our Blue Bell ice cream back as soon as possible. So while I understand the reason for your comments, I think it might be a more worthwhile venture to figure out HOW Blue Bell got the brand loyalty it has. Sure, maybe Blue Bell didn’t handle the listeria problem efficiently and appropriately. But before all that happened, they were doing something very well. And understanding how they became such a valuable brand to so many people would be a lesson I expect all retailers could learn from.
MNB user Mike Springer wrote:I believe overall we as a nation are a forgiving people. Your comment that “The name Blue bell is forever linked with listeria” will soon fade over time…as does many other situations when it’s convenient to do so.
This comment is not meant to take away from the seriousness of the deaths linked or the accountability that lies with the people involved; however, the people that have grown up with the brand and have enjoyed the product will soon be willing to forgive and will embrace the product they miss.
Blue had a cult following and I believe there is still a huge demand for getting this product back on the shelves.
From another reader:In my supermarket in Linden, Texas, folks will kick the door in to get Blue Bell. But those states that had just started selling it will probably not stock it. So it will never be what it was.
From MNB reader Joe Barsa:As a "yankee" who lived in Fort Worth for a year, I'd have to disagree with your opinion on the imminent demise of Blue Bell. Texans are the most prideful and fiercely loyal people I've ever come across, often times to a fault. There were stories in the news down there about people who were filling their entire freezers with potentially tainted product after the recall, because they were terrified that they might not be able to buy it again. Blue Bell is an iconic Texas brand through and through and I'd imagine that consumers in Texas will come back with open arms once things get straightened out. Also, the whole listeria thing aside, it really was the best store-bought ice cream I've ever had.
MNB reader Rich Heiland wrote:In the wake of the Bass investment I thought I'd drop you a note. I live about 40 minutes from Brenham. It has surprised me how Blue Bell has dropped off the radar. You just don't hear people talking that much about it. I don't know if that is just a case of every news story running its course, acceptance or just waiting it out on the assumption it will come back. And, I think it will come back in Texas, and even come back strong. Beyond that I am not sure if the brand can be resurrected or how soon.
In terms of Bass, I am not surprised to see someone step in, though I was surprised it was him as opposed to another food company bottom fishing. I am not surprised Blue Bell needs money. As a private company we can't know how much debt they are carrying, what the terms of insurance might have been for bringing plants back on line, if there is insurance given claims of negligence in terms of who knew what and when. But, it would not surprise me if the company has taken on significant new debt to clean up and retool, or had to re-negotiate current debt because of loss of cash flow.
But, I would never sell Bass short. I would not be shocked, depending on how much he put in and how much control it gives him, that one day we are saying "Boy, that damn Bass sure can pick 'em."
I will concede that my lack of Texas roots and the fact that I've never eaten Blue Bell ice cream colors my perceptions.
If it comes back, it'll be a major branding story. I'm not persuaded, but we'll see.
Regarding the cutbacks at Haggen, MNB reader Ken Fobes wrote:I couldn’t agree more with your comments. The company is an unknown entity in the Pacific Southwest market and faces an uphill battle to grow its business. Their task will be even more daunting by cutting staff and labor hours in their stores.
The good news is that by re-branding the stores they acquired, they have a perfect opportunity to leap-frog their more established competitors, without any existing carryover “baggage. They must now deliver on their Fresh and Local go-to-market strategy. If they do, they will build a strong foundation upon which they can grow market share and secure a loyal customer base.
We believe fresh department operations (Meat, Seafood, Produce, Deli and Food Service) are the ultimate private label and competitive differentiator.
If Haggen wishes to grow sales and margin, reduce operating costs, improve associate productivity and provide superior customer service, they should focus their attention on improving their fresh operations. Without this focus, they risk leaving significant incremental sales and savings dollars on the table.
The other day, we had a story about how Whole Foods is teaming up with PBS Kids for a back-to-school promotion designed to get into the hands of young students "a variety of eco-friendly school supplies, from notebooks made from recycled paper to organic cotton backpacks and reusable lunch totes. Many of the proceeds from the sales will be used to support PBS Kids’ educational programming and the Whole Kids Foundation, which is dedicated to improving children’s nutrition and wellness."
I commented:I think this is a very good idea ... but I can't help but think that maybe while those kids are in Whole Foods picking up their school suppliers, maybe they could give some basic addition and subtraction lessons to all those clerks who the retailer "admits" have been overcharging shoppers.
Which led one MNB reader - and Whole Foods executive - to write:You take something positive and then just couldn’t resist throwing in a cheap shot at Whole Foods. Nice! Everyone is always looking for their chance to take their pot shots. Welcome to the club.
I was just being a wisenheimer. I do that with just about everybody.
And finally, from MNB reader Terry Pyles:I have been a loyal and avid MNB subscriber for many years. I look forward to it every day. I so appreciate the hard work and dedication that you, Michael, and Kate contribute in order to keep your readers informed of the issues of the day, be they business or social. I want to thank you for all that work.
IMHO today's MNB was one for the ages. Great analysis, excellent commentary, a terrific guest column, and as always, fantastic feedback from your readers.
I was particularly impressed with the letter from Leslie Sarasin, president/CEO of the Food Marketing Institute (FMI). I usually find it somewhat tedious to get through a multi paragraph "Your View", but not this time. Ms. Sarasin's letter was thought provoking and extremely well presented. While she was critical of some of your previous analysis, she was neither rude nor insulting. A most excellent read.
If today was somebody's first time reading MNB they surely got a taste of excellence. Where else are you going to find Vulcans, pinko commies, dead chains walking, and unabashed Mets fandom all in one place?
As far as I'm concerned, you can put that last sentence on my tombstone.