Sign up for the MNB Wake Up Call!

Friday, July 22, 2016

  • Change Font Sizes:
  • A
  • A
  • A
  • A

FaceTime with the Content Guy: 365 by Whole Foods


This commentary is available as both text and video; enjoy both or either ... they are similar, but not exactly the same. To see past FaceTime commentaries, go to the MNB Channel on YouTube.

Hi, Kevin Coupe here, and this is FaceTime with the Content Guy. I'm reporting to you this morning from the new 365 by Whole Foods store in Lake Oswego, Oregon, the second store under this banner that has been opened by the company.

In promoting the 365 concept, Whole Foods has talked about it being lower priced than its traditional stores ... with a greater use of technology ... a tighter focus on private label ... and more limited SKU count ... all of which it hoped would add up to stronger appeal to millennials and other folks put off by its "whole paycheck" image.

After having spent some time in the store, I can tell you that I'd probably give it a C+ ... or, as Mrs. Content Guy, a third grade teacher, would put it, "definitely needs improvement."

One of my concerns about the format, at least from how it has been described, was that it would derivative rather than differentiated, and I'm sorry to say that this version, at least, bears out those fears. While it is an attractive store, with high ceilings and warm colors, it also sort of feels like Costco and Trader Joe's got together and had a baby. The shelving feels like it was stolen from Trader Joe's warehouse, and the frozen food coffin cases are right out of the Trader Joe's playbook, except that they sort of obscure the product rather than highlighting it.

There are some nice touches, like a cold room in the produce section - again, right out of the Costco playbook - and a good use of electronic signage. Except that the electronic signage works against the low-price image, and there is a startling lack of price-oriented signs throughout the store. The prices may be good, but also may not be - the limited assortment makes it hard to determine. But bananas selling for 19 cents apiece - and organic bananas selling for 29 cents apiece - certainly doesn't strike me as cheap.

There's also a ton of labor, despite the fact that service departments are at a minimum ... and you'd think that labor is one place where they could save money. But maybe that's because the store is new, or because John Mackey and Walter Robb happen to be here this morning.

While I like some of the technology, some of it seems awkward. There is a tablet computer in the wine department that allows you to scan s wine label so you can get more information - but the information largely consists of short reviews mostly by people who are largely unidentified. I don;t know who they are, or what their taste in wine is. And the technology doesn't even answer what often is the most important question when it comes to wine - what food does it go with? Another cardinal sin in the wine department - they appear to have more California pinots than Oregon pinots. That's just not cool.

Listen, this is early in the 365 development process, so it is impossible to accurately judge where this format will take the company. That's especially true because - and I've talked to some vendors about this, and they agree - this particular 365 seems like a work in process.

And to be fair, I did talk to some customers who think this is a refreshing addition to the community's shopping options. Some say the salad bar is great, and the burger bar seemed to be getting some action... My summer class at Portland State University has as an assignment visiting this store and writing about it. They're all millennials, so I'll let you know down the road what they think.

365 by Whole Foods ... derivative rather than differentiated, and needing improvement.

That's what is on my mind this morning, and as always, I want to hear what is on your mind.

Friday Morning Eye-Opener: Tape Measure

by Kevin Coupe

In the movie "Other People's Money," the central argument is whether it makes sense to be the world's best buggy whip manufacturer in a world that no longer needs buddy whips. Or, for that matter, the world's only buggy whip manufacturer?

(The secondary question, one never answered to my satisfaction, is what kind of world do we live in where Danny DeVito gets billing over Gregory Peck? But I digress...)

The buggy whip discussion clearly has been going on at the headquarters of the Funai Corporation of Japan, and they've reached the only conclusion possible.

The Funai Corporation, you see, is the world's last manufacturer of video cassette recorders (VCRs), a device that revolutionized the home entertainment business. Supplanted by DVD players, and more recently by streaming technology, VCRs would appear to longer have a place at the technology table ... and so, according to the New York Times, Funai Corp. will stop manufacturing them at the end of the month.

It seems that while Funai actually sold 750,000 units "worldwide in 2015, down from millions decades earlier," it no longer can get the parts to keep making them.

And so, the VCR is going the way of the buggy whip. And now, it seems to me, we can start taking bets on how long it will be before the DVD player will go the way of the VCR.

Because it is going to happen. It always happens. And while we shouldn't be surprised, it'll be an Eye-Opener.

Editorial continues after a word from our sponsor...

Corporate Drumbeat

From ReposiTrak ... A New CEO Spotlight Series...

Now back to regularly scheduled editorial...

Studies: Brand Resonance Among The Millennial Generation

New reports from Watershed Communications says that "84 percent of millennials feel they can easily describe, in one sentence, a food or beverage brand or product they just discovered," while "100 percent of the millennials surveyed said they frequently purchase food and beverage brands they list as authentic."

Lisa Donoughe, Watershed’s principal and founder, says in a prepared statement that the takeways are a) how fast millennials make up their minds about products, and b) how millennials equate simplicity and consistency with authenticity.

KC's View: The lesson, I think, is that is is critically important for brands to communicate their narratives clearly and unambiguously. No room to be vague, not with this generation.

Editorial continues after a word from our sponsor...

Corporate Drumbeat

From MyWebGrocer...

Now back to regularly scheduled editorial...

Amazon Gets Into Financial Services Business

The Wall Street Journal reports that Amazon is getting into the banking business, after a fashion, by entering "into a partnership with San Francisco lender Wells Fargo & Co. in which the bank’s student-lending arm will offer interest-rate discounts to select Amazon shoppers."

According to the story, "Members of the company’s 'Prime Student' service are receiving a student-loan offer by a lender through its site ... The discount will be offered both to students who want loans to attend college and those who want to refinance existing loans. The offer also represents the latest effort among private student lenders to stand out by discounting in an increasingly competitive market. Many offer discounts to customers who set up recurring payments to pay back their loans automatically or for loan refinancings by graduates who are members of professional associations."

KC's View: This is the second time that Amazon has gotten into college financing - the other being its Career Choice program, which offers tuition reimbursement for hourly employees throughout the company - regardless of whether the courses or degree have anything to do with the person's Amazon employment. This program reimburses up to 95 percent, or $12,000 - and a recent Business Insider story said that "more than 7,000 hourly employees in 10 countries have taken part in the program, with more than 1,300 employees taking a college-level or vocational course at classrooms that Amazon has located in its warehouses."

The programs aren't the same, but I do they think they tap into a core consumer concern about the cost of education. All of which only means that Amazon is good at recognizing the zeitgeist.

Editorial continues after a word from our sponsor...

Corporate Drumbeat

From ProLogic Retail Services...



Now back to regularly scheduled editorial...

Lots Of Upside Left For Meal Kit Businesses

The NPD Group is out with a study about the meal kit business, saying that "trial of meal kits is still relatively low with 3 percent of the U.S. adult population (18 and older) trying a meal kit delivery service within the last year."

What this suggests is that the buzz is greater than the penetration, which means there is a lot of room to grow. "Those using meal kits are generally satisfied and two out of three kit users are extremely or very satisfied, but price may be a barrier for continued use and adoption by others," NPD says in its report.

“The outlook for meal kits is uncertain since they’re still in their infancy stages and gaining trial among consumers," says Darren Seifer, NPD Group’s food and beverage industry analyst. "One of the main concerns about these services is the cost."

Editorial continues after a word from our sponsor...

Industry Drumbeat

Register Now for the Path to Purchase Expo



Visit www.Path2PurchaseExpo.com for a complete list of speakers, exhibitors and the full conference agenda. Register today to reserve your spot!

The Path to Purchase Expo, the world’s largest gathering of shopper and retail marketing professionals, delivers solutions and strategies for engaging shoppers and driving retail sales.

Now back to regularly scheduled editorial...

Counterfeiters Cause Problems For Amazon

CNBC reports that Birkenstock has decided to stop selling its products on Amazon and won't authorize third-party sellers to do so. The reason: counterfeiters and unauthorized sellers who have been peddling products under the Birkenstock label on the site.

"The Amazon marketplace, which operates as an 'open market,' creates an environment where we experience unacceptable business practices which we believe jeopardize our brand," Birkenstock USA CEO David Kahan wrote to company partners. "Policing this activity internally and in partnership with Amazon.com has proven impossible."

According to the story, "Earlier this month, CNBC.com reported on the scores of legitimate sellers that are hurting because fraudsters are knocking off their products and utilizing tactics such as paying for reviews, jumping into their listings and taking advantage of loopholes in Amazon's logistics system. For example, Amazon commingles inventory from distributors at its fulfillment centers, so authentic products and fakes can get mixed together. The story included reference to Birkenstock, which has seen legions of Chinese sellers promoting its flagship Arizona sandal for $79.99, or $20 below the retail price."

Amazon has not commented on the move.

The story goes on: "The dependence that so many businesses have on Amazon is a major reason why the company hasn't suffered financially from the counterfeit surge. Amazon's global network of warehouses and data centers, coupled with a highly sophisticated and efficient delivery system, have produced consistent sales growth and drawn the love of Wall Street. The stock is up 52 percent in the past year and is trading near $743.

"Perhaps Birkenstock will present a case study in how to succeed without the world's largest online marketplace. Then again, even Kahan knows that just because he's leaving Amazon doesn't mean his shoes, or something resembling them, won't be readily available."

KC's View: It seems to me that companies like Amazon have a core responsibility to do everything possible and necessary to insure that counterfeit and illicit products are not being sold on their sites. No excuses. It may require new investments and policies, but in doing so, they protect not just their sellers, but their customers.

And that's a bottom line responsibility.

Editorial continues after a word from our sponsor...

Corporate Drumbeat

From Samuel J. Associates...Why Career Success Is Not A Shiny Car

Now back to regularly scheduled editorial...

The MNB Walmart Watch

• The St. Louis Post Dispatch reports that "Walmart shoppers in the St. Louis region will soon be able to order groceries and other merchandise online, get same-day pickup and free loading. The retail giant, which already offers the service in more than 50 markets nationwide, plans to begin offering it at its Supercenter stores in Festus, Collinsville and Arnold on Monday and Lake Saint Louis and Washington on Tuesday."

Editorial continues after a word from our sponsor...

Industry Drumbeat

From the National Grocers Association...


Now back to regularly scheduled editorial...

FastNewsBeat

• The Wall Street Journal reports that Chipotle "is recovering far more slowly than expected from a series of food-safety problems last year, despite promotions and other efforts to lure back consumers." Same-store sales were down 24 percent for the second quarter - "less than the 29.7% retreat posted in the first quarter but worse than the 20.4% decline analysts predicted" - and CFO Jack Hartung says that the problem is that while loyal customers have returned, is has not been at the same frequency.


Bloomberg reports that "cattle and hog futures have been sinking amid record American production of beef and pork that doesn’t look to be slowing down any time soon. As the meat piles up, retail prices have already been falling and more supplies means that grilling staples including burgers, ribs and pork chops could get even cheaper."

Editorial continues after a word from our sponsor...

Industry Drumbeat

Energize your Digital Circular

Now back to regularly scheduled editorial...

RIP

Don Soderquist, the former Walmart executive who spent 22 years with the company, eventually becoming COO and vice chairman, passed away yesterday. He was 82, and passed way due complications from heart surgery earlier in the week.

Your Views

...will return.

Editorial continues after a word from our sponsor...

Industry Drumbeat

Topical, relevant, engaging, thought-provoking...Who could ask for anything more?

When Kevin Coupe gets on stage in front of your company meeting, association conference, or any other event, the pace is fast ... the thoughts are provocative ... the focus is innovation ...the style is entertaining and interactive ... and the reviews are glowing...

"Kevin inspired our Stew Leonard's management team with his insights about the food industry and his enthusiasm. We've had the best come in to address our group, and Kevin Coupe was rated right up there.  He had our team on the edge of their chairs!"
- Stew Leonard, Jr., CEO, Stew Leonard's

"Our sales organization is a very skeptical bunch, and your presentation was both topical and relevant. The content was right on to address the meeting theme, and was presented in way that kept the audience enthralled. I had quite a few positive comments at the break, something that does not happen frequently. We appreciate the time and effort to help make this sales meeting one of the best we have had in several years."
- Jon Kramer, Chief Marketing Officer, WestRock Merchandising Displays

“Kevin’s presentation to our Phoenix group was very well received! The topic was very relevant to all the retailers in the room, with just the right amount of humor. The icebreaker at the beginning, and the personal interaction at the end was truly engaging!”
- Cathy Kloos, Director of Human Resources, Albertsons Safeway

“Kevin was an engaging speaker whose stories really brought the concepts to life. Although his lessons were focused on retail rules to achieve business success I found the lessons could be directly linked to enhancing my leadership style. “
- Jessie Thomas, Director Merchandising Solutions, MDM and PMO, Petsmart

And there's more...

"Your presentation was well-received, very thought-provoking and was a great lead-in to the overall theme of our show."
- Tim Myers, CMO, Affiliated Foods Midwest

"Your presentation was unbelievable – everything we hoped for and much, much more!  Thanks for making our customers (and us) better!"
- Joe Himmelheber, Director of Marketing and Merchandising, Caito Foods

"Both of your presentations kept the audience engaged ... This was a difficult subject, but you made it easy to understand - and learn from. Everyone who has not yet seen one of your presentations, should know how informative and to the point your program is and how it will definitely enhance their event. "
- John M. Dumais, president/CEO, New Hampshire Grocers Association

"Kevin is an engaging speaker who really brought the content to life.  He customized his program to meet our needs to ensure our event was a success!
-Kim Richardson-Roach, Network of Executive Women (NEW), New England Region


"The response to this session was overwhelmingly positive. The audience appreciated the lively and enlightening exchange between the moderator and panelists ... the spark you added to the panel as moderator contributed to the flame of excitement this event engendered ... Thank you for helping ground the material in a reality readily recognized ..."
-Leslie G. Sarasin, President/CEO, Food Marketing Institute (FMI)

Kevin Coupe uses his unique perspective as MorningNewsBeat "Content Guy" and more than 30 years writing about business, marketing and innovation to identify the ways in which consumers are changing, the reasons behind these changes (technology, the economy, culture, demographics), how new and unorthodox competitors are altering the marketing landscape, and what companies need to do to find and exploit differential advantages.

Want to make your next event unique, engaging, illuminating and entertaining?Start here: KevinCoupe.com. Or call Kevin at 203-662-0100.

Now back to regularly scheduled editorial...

Save The Date - A Note From The Content Guy

Once again, I've been getting emails from MNB readers living in the Portland, Oregon, area, asking for one of those casual get-togethers that we've done here the past few years. I'm game if you are ... so let's do one next week...

Let's meet at 5 pm on Thursday, July 28 at Nel Centro, located at 1408 SW 6th Ave, in Portland. I'll plan on being there for a couple of hours - if the weather holds, on the outside patio - and I hope that any MNB readers who'd like to stop by will do so.

OffBeat: Who Ya Gonna Call?

Let me start by saying that I have absolutely no sympathy for the misogynists who have been suggesting - almost from the moment the project was announced - that the new Ghostbusters reboot should not exist because it was replacing Bill Murray, Dan Ackroyd, Harold Ramis and Ernie Hudson with Kristin Wiig, Melissa McCarthy, Kate McKinnon and Leslie Jones.

The argument by some of the trolls who used social media to advance their obnoxious and prehistoric opinions seemed to be that women comics had no right to replace male comics, and that somehow this was symbolic of the end of the world. (You know. Forty years of darkness! Earthquakes, volcanoes! The dead rising from the grave! Human sacrifice! Dogs and cats living together! Mass hysteria!) There is this feeling in some quarters that women can't be funny, or at least not as funny as men, which I think is completely absurd. Bridesmaids and Trainwreck were two of the funniest movies I've seen in years, giving actresses like Amy Schumer, Wiig and McCarthy the opportunity to sink their teeth into very funny roles in very funny movies. With abandon.

Sadly, very little of this abandon can be seen in the new Ghostbusters. In fact, the word I would use to describe the movie is "careful" - the film seems to have almost no spontaneity to it. Unlike the original, which had a slapdash quality to it that made it seem almost improvised, this one seems so carefully scripted and performed that it verges on being boring. I can understand wanting to be careful not to violate the spirit of the original - still one of the funniest movies of that era - but in so many ways the Ghostbusters spirit could've been best served by just letting loose.

The movie does have moments. Most of them belong to the wonderful Kate McKinnon, who has a cool subversive quality just dying to be let out; Leslie Jones also has some good moments, though it might've been nice to have her cast as one of the doctors instead of as a transit authority employee. But Wiig and McCarthy are pretty much wasted; they're so much better than this movie allows them to be.

Now, compare the new Ghostbusters, if you will, to another new movie - Mike & Dave Need Wedding Dates, which is a hard-R-rated comedy that ratchets up and doubles down on the raunchy comedy approach served up a few years ago by the very funny The Wedding Crashers.

Mike & Dave is the story of two adult brothers who seem to bring a kind of infantile humor to every situation they're in, resulting in chaos and disaster. This especially happens at family events, and so when their little sister announces she is getting married and having a destination wedding in Hawaii, Mike and Dave's parents instruct them to find two nice girls to bring to the wedding, or don't bother coming.

This sets off an internet search for two nice girls - but it also creates an opportunity for two "bad" girls to pass themselves off as nice in order to get a free Hawaii vacation. As you might expect, more chaos and some measure of hilarity ensue.

Now, I'm not going to argue that Mike & Dave is a better movie than the new Ghostbusters, but I will suggest that it has a kind of loose, improvisational quality - especially in the performances by female leads Anna Kendrick and Aubrey Plaza, who totally outshine Zac Efron and Adam Devine as their male counterparts.

Kendrick (who I've had a crush on since Up In The Air) and Plaza deliver antic, up-for-anything performances that are even braver because they're so much more depraved than the guys. They may be bad girls, but they're nobody's victims ... and there is nothing careful or measured about their performances.

Ghostbusters could've used a little more of that. Hell, Ghostbusters could've used a lot more of that.

There's a business lesson here, I think. Sometimes, it is possible to be too careful, to be too respectful of what has come before. I've always believed that innovation often starts when people say, "What the hell..." Caution rarely is fertilizer for genius, and I think that the new Ghostbusters is a prime example.




I've spent a lot of time in the car over the past few weeks, which means I've had time to listen to a lot of podcasts. Which means that for the second year in a row, I've been binge-listening to "Serial," the NPR podcast that does a weekly deep dive on a single criminal case.

Last year, "Serial" investigated the murder conviction of Adnan Masud Syed, who, the show revealed, may have had an inadequate defense. (It looks like the "Serial" reports may have resulted in Syed getting a new trial.)

This year, the podcast looked at the case of Bowe Bergdahl, the American soldier who appeared to have deserted and then was held for five years by the Taliban before being released. He now is facing as court martial, and "Serial" looked not just into the circumstances of his case, but also provided deep - and implicitly critical - insights into US mideast policy decisions. It was absolutely riveting, and while I don't think that Bergdahl is an innocent, I do think that an understanding of his case requires context and nuance.

"Serial" is great storytelling, with compelling characters and a terrific host in Sarah Koenig. I cannot wait until Season Three comes out ... though I'll have to wait for a long drive to listen to it.




My wine of the week - the 2013 Sea Smoke Pinot Noir, which was delicious ... and a total treat, since it is near impossible for mere mortals like me to obtain.




That's it for this week. Have a great weekend, and I'll see you Monday.

Fins Up!

PWS 22