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Wednesday, February 22, 2012

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Sansolo Speaks: When Companies Live in Glass Houses

by Michael Sansolo

The best part of my job is that I get constant reminders of how little I really know and a chance to know better. It’s been said that awareness of ignorance is a step toward knowledge, so here I go stepping again.

I’ve been writing a lot about social networking lately and as a middle-aged boomer I know that I’m constantly in danger of being exposed for all I really don’t know. To quote the eminently unquotable Britney Spears, “whoops, I did it again.”

Last week I learned about GlassDoor.com, a website that every company leader needs to check out instantly. (Okay, wait to finish reading MNB and then check it.) GlassDoor is a logical step in the altered flow of information in today’s world. Now it can change recruiting beyond recognition. First some background:

At the NGA convention in Las Vegas I moderated a panel on promoting the supermarket industry to the next generation. My panel included five students, all of who are studying for careers in the industry. (Sadly, none said retail is their desired destination, but that’s not the point of this article.) As they detailed their paths so far between part-time industry jobs, internships and studies the discussion moved to how they use modern communication to learn about the companies interviewing them.

In my naiveté I assumed the answer would be a cool review of how networks form these days. My expectation was that they cleverly search sites like Facebook and LinkedIn, finding current employees and other links to learn more about a company. As always happens when I assume, I was wrong.

Instead they told me about GlassDoor.com, a site where the entire process is made far simpler. It’s a site where current employees can easily spread the word about their companies. In many ways, GlassDoor is the Trip Advisor of job hunting, allowing the recruit to learn far more about a company and its management team than ever was possible in the past.

And that alters the recruiting process. We’ve all had jobs or hired people for jobs knowing full well that the rosy picture of joining company XYZ was always less than completely honest. But once on the job, we - or our recruits - found out about some of the strange issues of company culture be it micro-managing bosses or infighting among top management. It was a reality of any job and it’s a reality that’s not going away.

The difference is with GlassDoor those issues are no longer hidden. Just as reviewers at TripAdvisor will easily dish about noisy hotel rooms, GlassDoor lays a company’s issues wide open. In it, employees can offer reviews of the company, rate their satisfaction, provide information on salaries and vote on their CEO. (Here’s a shock: Mark Zuckerberg of Facebook and Tim Cook of Apple get approval scores in the 90% range. The CEO of troubled Kodak was in the 20s.)

Let’s be fair here. The same transparency that lays companies bare to applicants works both ways. Companies can increasingly using social networking to learn about prospective employees, many of who mistakenly leave a trail of messes in their own electronic wake.

In so many ways, we may actually want to embrace this new transparency. As some of the students on the panel explained, their problem with retail jobs they held weren’t the usual suspects: hard working conditions, tough hours and some really dirty jobs. What bothered them more was the lack of honesty in the hiring process. As one young woman explained about a convenience store job she held, she would have taken the job even if she knew the truth. The difference is the surprises she found wouldn’t have been surprises and bad surprises at that.

It’s the age of transparency whether we like it or not. Whatever we do or whatever we sell, the simple reality is we now live in glass houses and offices where the worst response is to throw stones. Instead, we need to improve.


Michael Sansolo can be reached via email at msansolo@morningnewsbeat.com . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available by clicking here .

Walmart Tops List Of Nation’s Best Retail Brands

Interbrand is out with its annual “Most Valuable Retail Brands” list, saying that Walmart maintains its place atop the list.

According to the report, “Walmart is still #1 by a huge margin, with a brand value over US $139 billion, down 2% from last year. Target holds on to the #2 position with a value of US $23 billion, up 1% from 2011. The Home Depot maintains its hold on #3, while CVS/pharmacy moves up to #4, surpassing Best Buy, who experienced an 11% decline in brand value and falls to #5 on the list. Walgreens remains at #6, while Coach's 16% increase propels them to #7, now ahead of Sam's Club (#8). Top riser Amazon.com is #9 and eBay moves into the top 10 for the first time. eBay replaces Dell, which falls off the list due to the fact it no longer meets the criteria for the list with less than 50% of its revenues from sales through its branded retail locations.”

Other notables on the list include #12 Publix, #14 Dollar General, #15 Costco, #38 Whole Foods, #29 Dollar Tree, and #47 Family Dollar.

"One of the most compelling lessons from the list is that the best brands didn't stand idly by, waiting for further signs of recovery. They contributed to it by anticipating their customer's desire to return—not to shopping as usual—but to something better," said Bruce Dybvad, CEO of Interbrand Design Forum. "For the most part, companies have invested in better store experiences and put more capabilities into the hands of their shoppers."

KC's View: I’m guessing that Apple does not make the list for the same reason that Dell fell off the list. It also is instructive that Barnes & Noble is not on the list.

One of the things I agree with in the Interbrand analysis is what the company says about the importance of storytelling in creating brand equity. Two quotes along this line:

• ”While retail has historically been extremely operationally focused, more retailers are looking to brand to build value. A brand must develop a theme beyond a shopper's need for function and identity by adding even more emotion and dimension. The trick is to find the value beyond the transaction. The world's best brands know what the customer values, and work relentlessly to provide it for them.”

• “Experience is the defining element of any brand. It provides the memory that prompts repeat use, or doesn't. Shoppers expect their favorite brands to speak in a consistent voice, in-store, online and in traditional and digital channels. In retail it is extremely difficult to get all the customer-facing components to talk the same talk to convey consistency and relevancy. Design is the ticket to breaking out of an old brand identity to re-inspire your customers. It can help add excitement and drama to routine transactions and its storytelling ability can energize brand culture.”


I’m a little dubious about the Walmart ranking, which strikes me as having more to do with size and ubiquity than the creation of a dynamic shopping experience. But maybe that’s just me.

Editorial continues after a word from our sponsor...

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Now back to regularly scheduled editorial...

Wednesday Morning Eye-Opener: Little Burgers With A Little Vino

The Wall Street Journal this morning has a piece about a White Castle in Lafayette, Indiana, where in addition to the usual menu of small, square burgers there also is “a thoughtfully balanced varietal selection, from a pétillant Moscato to a quite approachable Merlot.

According to the story, the move is seen as a way of being just a little bit more competitive in the marketplace ... though at this point it is just a test limited to one store. (And to be fair, there are a number of retailers in this space - including Burger King, Sonic, and Starbucks - that are testing alcohol sales in a limited number of units.)

“White Castle hasn't sold beer - also newly on sale in Lafayette - or wine up to now, but for those who missed the movie Harold and Kumar Go to White Castle, it is famous as the place where fervid ‘cravers’ - drunk, stoned or just gluttonous - go to pig out,” the Journal writes.

In other words, while the idea of beer and wine at White Castle seems ironic, it also seems to be perfectly in synch with its image in the marketplace - “in sync with the zeitgeist,” as one restaurant expert puts it.

Virtual Supermarket Opens In Australian Railroad Station

The Sydney Morning Herald reports that Woolworths there has unveiled a virtual supermarket - akin to the one developed by Tesco in Seoul’s subway system - in the Flinders Street Station in Melbourne, which hosts more than 100,000 commuters each day.

According to the story, “The temporary billboard, which looks like a real supermarket shelf with images of 120 key grocery items, enables commuters to purchase products by scanning the barcodes on the billboard with their smartphones. The barcodes take users to Woolworths' mobile phone app where the store's full range of 40,000 products can be purchased and delivered to homes and offices within hours ... Last week Woolworths upgraded the mobile phone app it launched last August to include a checkout facility, allowing users not just to compare prices and create shopping lists, but to shop from their mobile phones.”

The Morning Herald also notes that “despite online grocery shopping being available in Australia for 14 years, online grocery sales account for just 1 per cent of total grocery sales, according to last year's productivity commission into the retail industry. This compares to up to 4 per cent in Britain and about 2 per cent in the US.”

KC's View: The virtual store could be a real game changer for the food industry, and it will be fascinating to watch how it grows in appropriate markets, and when it gets picked up by the likes of Walmart and Amazon and given real legs.

Editorial continues after a word from our sponsor...

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Now back to regularly scheduled editorial...

The Battle of the Tablet Computers Continues

The Los Angeles Times reports that Barnes & Noble plans to release a new eight-gigabyte version of its Nook Tablet that will retail for $199, a move that will match the size and cost of Amazon’s Kindle Fire. At the same time, Barnes & Noble said that its other eight-gigabyte tablet, known as the Nook Color, was cut from $199 to $169.

According to the story, “The two devices are slightly different shades of gray and the Nook Tablet runs a different version of Barnes & Noble's flavor of Google's Android operating system. Because of the software differences, the Nook Tablet can run a larger number of apps than the Nook Color.”

And all of these tablet innovations are designed to be competitive with Apple’s iPad.

KC's View: The rumors are that Apple is going to come out with the iPad 3 in a couple of months ... which means that there will be a flurry of innovations in the short term. And it all is related to the growing use of mobile devices to communicate and transact commerce, which is going to affect how marketers present themselves to consumers over the next few months and years.

Wawa Plots Florida Invasion

The Tampa Bay Times reports that Wawa is going to Florida. And not just for the winter.

The paper says that the Philadelphia-based convenience store chain “has a half-dozen stores under construction around Orlando slated for a July 18 opening and a half-dozen more locations lined up in the bay area to open by this time next year.”

As the story notes, “for the uninitiated, Wawa combines its mega-filling stations with C-stores four times the size of a 7-Eleven. Staffed by 30 people, each Wawa features made-on-site deli hoagies, gourmet coffees, fresh-baked goods and groceries 24/7.

“While many 14- to 20-pump filling stations treat food-to-go as an afterthought, Wawa, which is leapfrogging into Florida after covering the mid-Atlantic with 600 locations, gives takeout and dashboard dining top priority.”

KC's View: I love Wawa, mostly because it has consistently challenged the boundaries of what c-stores are supposed to represent. It makes up its own rules, and that is impressive.

Editorial continues after a word from our sponsor...

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E-conomy Beat

Internet Retailer reports that Nordstrom Inc. plans to “spend almost $1 billion over the next five years to continue to support its e-commerce infrastructure, chief financial officer Michael Koppel told Wall Street analysts on the company’s recent year-end earnings call.”

The investment is a direct reflection of where Nordstrom sees its growth taking place. Over the past year, what it calls “direct” sales, which is almost completely online sales, were up 30 percent, while total sales were up just under 13 percent and same-store sales were up a little more than seven percent.

The MNB Walmart Watch

Bloomberg reports that South Africa’s Massmart Holdings said yesterday that “its profitability is under pressure because of the costs of expansion and selling control” to Walmart last year.

Editorial continues after a word from our sponsor...

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Now back to regularly scheduled editorial...

FastNewsBeat

• Arden Group announced that it will close one of its Gelson’s stores, in Northridge, California, on February 25. The company said that the “decision to close the store was based on the lack of profitability of the Northridge location for the past several years. The Company is currently considering possibilities to assign or terminate its lease or sublet the property, but no agreement has been reached ... All currently active employees at the Northridge location will be offered employment at other Gelson’s locations.”

• More than 1,500 Zellers workers have ratified a new three-year collective agreement, according to the Canadian retailer, which also said that “the new three-year deal includes wage increases and enhanced severance pay in the case of store closure.

“Four of the Zellers stores covered by the collective agreement will be converting to Target. The unionized Target stores are located in Toronto, Oshawa and Brantford. A fifth unionized store in Windsor, which was also purchased by Target, will be converting to a Sobeys. UFCW Canada is challenging Target to abide by all provisions of the new collective agreement.”

• Jamba Juice announced that it has acquired Chicago-based premium tea company Talbott Teas. Terms of the deal were not disclosed.

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• Richard Dufresne, CFO at Montreal-based supermarket group Metro Inc. for the past six years, is moving over to George Weston-owned Loblaw Cos., also as CFO.

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Now back to regularly scheduled editorial...

Your Views: Much More About Supervalu, And A Little About Baseball

One MNB user wrote:

I would like to respond to your readers’ Supervalu views from yesterday.

First and foremost I applaud the first MNB user how he or she continues to have confidence and pride in the company.  I was a long term employee who left last year and continue to follow the company closely and the many friends and co-workers still there.  I agree with the assessment that the tough decisions must be and are being made in addition to the multiple other ones that accommodate them.  I am glad that you believe that there is a light at the end of the tunnel.  You are either more informed than most I know still in or formerly in the company or the Kool Aid is tasting better than I did when I and many others were there.  But I truly hope that things are turning for Supervalu, I really do.

I would like to take offense at your statement that those of us who have left ‘didn’t seem to be able to do the work to fix it (issues, sales, downward slide, etc.) either’.  And also in the statement that Supervalu has done ‘a good job of ensuring the top talent was retained'.  To the first point: have you not seen the hundreds of extremely talented, experienced and passionate people who have left over the last 3-4 years?  Did they not meet your Talent Quotient?  What about the thousands who have left due to downsizing or on their own accord that gave it their all but tired of dealing with ineffective systems, policies and ever-changing programs?  And those ‘sub-top talent’ folks you reference are now creating value for your competitors and suppliers.  And what about those still in the company who are effectively non-effective because they are over-whelmed, over-worked  and their main focus is to stay employed while they actively look for other employment?

I too believe that CEO Craig Herkert is trying to do all that he can to turn it around, trying to be the merchandiser coach (caught in the weeds) and being the visionary leader (in the air).  He may have experience and success in a very well-run and structured organization like Wal-Mart but he has not been able to turn a chaotic, ‘legacy Albertsons vs. heritage Supervalu’, ‘head office vs. banner’ mentality into a successful operation as of yet.

The third MNB user states that it is matter of Albertsons' faulty ways and people that have caused Supervalu to falter.   I also applaud your pride in Supervalu and the way they were successful prior to the acquisition of Albertsons – they were a success story just as Albertsons was prior to their American Stores acquisition and American Stores was prior to their many acquisitions.  In both of these cases (and in many other merger/acquisition cases throughout history) when one company purchases the other company the original company loses it separate identity and those companies become one regardless how successful either was before.  It is up to the purchasing /acquiring company leaders or a combined, unified leadership to provide the direction and ‘best practices’ going forward and to make the two companies one successful, cohesive new entity.  Or make changes to create new best practices to move them to a higher point than what was before.  The former companies cease to exist and it is up to the leaders (regardless of their past allegiances) to merge the teams into a stronger unit than the two companies were before.  And it is up to the leadership to create a framework and example of teamwork and common purpose and eliminate the mentality of us and them.

To blame Albertsons for all problems the company has had and is currently having is very short-sighted and more importantly incorrect.   If you haven’t noticed, there are very few old Supervalu or Albertsons upper management decision makers left but yet the results are still the same.

I too hope that what made Supervalu (and Albertsons and American Stores) great can be unearthed and change the game.  As each month and year passes more of the long term and committed employees are gone and so is the drive, commitment and passion that it takes to fuel the engine of change.   Time will tell, I would love for Supervalu to be another great American Success Story once again.  The story of Supervalu will be a case study in many business publications and university courses, either with a positive or a negative outcome; I am hoping former.





I wrote yesterday about the beginning of baseball’s spring training, and suggested that it is a time when hope springs eternal for everyone...except Mets fans.

Which led MNB user Steve Ritchey to write:

I know  you’re a Mets fan, I’m sorry for the problems the Mets have had the last several years.  Fans of the Mets deserve a competitive  team to root for and feel  proud of. 

Just remember, it can  happen, get the right ownership and management who understand  the game, and it can happen.  Look at the Texas Rangers, stuck in mediocrity for decades, (actually there was a time when mediocrity would have made us ecstatic, that’s how bad we were), now having gone to the World Series twice in a row, and coming within one strike of winning, twice coming within one strike of winning it all.  From top to bottom they have management who understands the game.  I hope the Mets get lucky and  get some owners who can finance a good team and that he puts a management team in place that can put a good team on the field, their fans deserve it.


Me, too.

Another MNB user suggested that there is another group for which hope may be lost:

People waiting for Pete to be elected to the Hall of Fame.

I would not be part of that group. As far as I am concerned, he gambled on baseball, breaking one of the sport’s sacrosanct rules, and then he lied about it. And continued to lie about it.

I know he was a great player, and his on-the-field accomplishments deserve to be recognized by the Hall.

But induction? He’d never get my vote. (Nor would Barry Bonds, BTW, or anyone else involved in the steroids scandals.)

And Finally, An Apology

...for the fact that MNB was posted late this morning. We had server issues, which now have been resolved.

Thanks, as always, for your patience and support.

Editorial continues after a word from our sponsor...

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Now back to regularly scheduled editorial...

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