retail news in context, analysis with attitude

MNB Archive Search

Please Note: Some MNB articles contain special formatting characters, and may cause your search to produce fewer results than expected.

    Published on: February 1, 2010

    The New York Times had an interesting piece over the weekend analyzing the innovation model used by Apple Inc., suggesting that it is at once elitist and individual, representing something called the “auteur model of innovation.”

    The story links the auteur approach favored by Apple CEO Steve Jobs to the “auteur theory” of moviemaking, in which films are seen as being “authored” by directors such as Alfred Hitchcock, John Ford, Martin Scorsese and James Cameron.

    “At Apple,” the Times writes, “there is a similar link between the ultimate design-team leader, Mr. Jobs, and the products. From computers to smartphones, Apple products are known for being stylish, powerful and pleasing to use. They are edited products that cut through complexity, by consciously leaving things out — not cramming every feature that came into an engineer’s head, an affliction known as ‘featuritis’ that burdens so many technology products.”

    Jobs’ approach “is not a product-design philosophy steered by committee or determined by market research. The Jobs formula, say colleagues, relies heavily on tenacity, patience, belief and instinct. He gets deeply involved in hardware and software design choices, which await his personal nod or veto. Mr. Jobs, of course, is one member of a large team at Apple, even if he is the leader. Indeed, he has often described his role as a team leader. In choosing key members of his team, he looks for the multiplier factor of excellence. Truly outstanding designers, engineers and managers, he says, are not just 10 percent, 20 percent or 30 percent better than merely very good ones, but 10 times better. Their contributions, he adds, are the raw material of ‘aha’ products, which make users rethink their notions of, say, a music player or cellphone.”
    KC's View:
    This seems like the perfect story with which to start a new week, since innovation should be the heart and soul of every customer-oriented enterprise.

    There are a number of points that I would like to make here, using Apple’s approach as reference point for what we all need to do in our businesses.

    One. When retailers and manufacturers hire people, to what extent are they looking for the “multiplier factor of excellence”? Are they looking for leaders and innovators, or are they looking for managers and functionaries? And, are they creating a climate that encourages and rewards unorthodox thinking?

    Two. What was the last “aha” product or service you had in your business?

    Three. To what extent are you trying to look around the corner, to see where the future is headed? In another piece about the iPad in this morning’s New York Times, the always-excellent media columnist David Carr points out that the iPad is ideally constructed as the kind of media tool that would not only make cookbooks easy to read, but also allow them to feature video demos of how to make various recipes...but at the moment, there are precious few publishers creating books that incorporate such multimedia features. The point: it is critical to be able to see where the road to the future is taking us, and not to be reliant on old business models.

    Four. Has your company fallen victim to “featuritis,” offering so many products and services that it does not reflect a specific mindset or creative vision?

    These are questions, it seems to me, that all customer-focused businesses need to ask themselves. Without doing so, innovation may be painfully hard to achieve.

    Think different.

    Published on: February 1, 2010

    Tops Friendly Markets has announced today that it has completed the court-approved acquisition of a majority of Penn Traffic’s assets, including its 79 supermarkets over a four-state area.

    The U.S. Bankruptcy Court approved the Tops’ bid for these assets last week. The stores are located in New York, Pennsylvania, Vermont and New Hampshire.

    Tops CEO Frank Curci said that a review of the acquisition by the Federal Trade Commission (FTC) will continue, and once it is completed, the company will pursue a capital improvement program.

    “We are very eager and excited to begin working with store managers and associates to best serve the grocery shopping needs of our new neighbors and customers,” said Frank Curci, Tops’ president and CEO, who added that all stores will remain open and operating through a transition services agreement with Penn Traffic while Tops evaluates each store over approximately the next 30 days.

    However, the completion of the deal apparently does not affect the lawsuit filed against Penn Traffic by Price Chopper, which is arguing that has bankrupt Penn Traffic broke its contract to sell it 22 supermarkets for $54 million when it signed the Tops deal. In the suit, Price Chopper claims ‘significant economic losses and damages’ and seeks a ‘break-up fee’ of about $1.6 million, or three percent of the $54 million purchase price.
    KC's View:

    Published on: February 1, 2010

    The Boston Globe reports that the House of Representatives of the Commonwealth of Massachusetts has voted to ban the sale of high-calorie sodas and salty and sugary snacks from the state’s public elementary and high schools, a move that supporters said would help fight the childhood obesity crisis.

    The bill now goes to the state’s Senate for a vote. If approved, the bill would go to the desk of Gov. Deval Patrick, who seems likely to sign it considering he already has proposed eliminating the sales tax exemption for candy and soda and using the extra revenue for health initiatives.
    KC's View:
    It would be nice if such a ban made kids thin and healthy, if by magic. It’d be nice if those sales taxes would go right to effective health programs, instead of into bureaucracy and redundant infrastructure.

    Isn’t it pretty to think so.

    Published on: February 1, 2010

    There was an interesting piece in the Boston Globe about the impact of posting calorie counts on restaurant menu boards.

    According to the story, “Researchers at Stanford University were able to persuade Starbucks to hand over data on every transaction at their stores in New York City, Boston, and Philadelphia around the time that New York City implemented its calorie-posting law. The researchers also obtained transaction data for a large sample of Starbucks cardholders during the same period and conducted in-store surveys in Seattle and elsewhere, around the time that Seattle implemented its own calorie-posting law.

    “In New York City - as compared to Boston and Philadelphia where no such law went into effect - food purchases, but not beverage purchases, contained significantly fewer calories after the law went into effect, and even fewer calories for people who had previously consumed the most calories ... Although one might expect the law to hurt business by reducing demand, the data showed no effect on Starbucks, and, in fact, Starbucks stores close to Dunkin’ Donuts actually gained some sales, perhaps because some customers of the latter were put off by the calorie content of doughnuts. Moreover, there was an increase in the average price per item purchased, suggesting that profitability increased, too.”
    KC's View:
    Demonstrating that transparency does not have to be a negative, especially if retailers offer a range of options. These days, these are two important components of any marketing plan that is going to be relevant to the current climate - you have to provide options up and down the nutrition scale, and you have to be transparent.

    Published on: February 1, 2010

    The Washington Post reports that there is a proposal circulating in the Maryland State Senate that would look to limit the number of new fast food restaurants in Prince George’s County, in a move that seems similar to those that have been proposed for South Central Los Angeles.

    The concern is that there are so many fast food restaurants in the area - and, in some cases, so few establishments selling healthier alternatives - that it creates a no-win scenario for residents. “According to a state assessment of children's health in Prince George's in 2002,” the Post writes, “nearly 40 percent of children ages 2 to 11 were overweight. Most were in lower income families. The study said 33 percent of adolescents had eaten three or more meals at a fast-food restaurant in the previous week.”

    Opponents of the proposal say that fast food restaurants are being unfairly targeted, and that a more holistic approach to health - including recreation centers, physical education in schools, and healthier food served in schools - would be more effective.
    KC's View:
    I tend to be skeptical about such moratoriums, but even more about the people who claim that the obesity crisis is the other guy’s fault.

    Published on: February 1, 2010

    The National Retail Federation (NRF) is out with its annual Valentine’s Day Consumer Intentions and Actions Survey, suggesting that “couples will spend an average of $63.34 on gifts for their significant other or spouse, compared to $67.22 last year. The average person will shell out $103.00 on traditional Valentine’s Day merchandise this year, similar to last year’s $102.50. Total holiday spending is expected to reach $14.1 billion.”

    The survey also says that “the average person will spend $5.37 on friends, up from $4.74 last year; $4.29 on classmates and teachers, compared to $3.59 last year; and $2.84 on co-workers, slightly up from the $1.94 they spent in 2009. Family pets will also feel the love this year with the average person spending $3.27 on their furry friends, up from $2.17 last year. Spending on family members will remain the same ($20.94 vs. $20.95 last year).”
    KC's View:
    So people are upping their spending on Valentine’s Day presents for their pets, who have no idea what the hell a Valentine’s Day is, and are lowering their spending on spouses and significant others.

    Yeah, this makes sense.

    Erich Segal must be rolling over in his grave.

    Published on: February 1, 2010

    Reuters reports that Ron Burkle’s Yucaipa Cos. is offering to invest $50 million or more in iconic clothing chain Barney’s New York, which would give him 80 percent ownership of the chain’s equity.

    However, the company’s current owner, Dubai-based Istithmar World Capital, apparently is not considering the proposal.
    KC's View:
    Forget Barney’s. I keep waiting for Burkle to get fed up with how his investment in A&P is playing out, and to make a move to take over that troubled company.

    Published on: February 1, 2010

    • Walmart announced today a new promotion that combines low prices on flat screen HDTVs perfect for watching the Super Bowl, and party packages of food that are designed for consumption during next Sunday’s NFL championship game.
    KC's View:
    I know there are all sorts of copyright and trademark issues involved, but it seems so crazy that Walmart - and pretty much anyone else marketing around Sunday’s Super Bowl - cannot use the words “Super Bowl.” I can, because this is editorial content...but advertisers and marketers have to say “big game” or some other euphemism.

    What the NFL doesn’t seem to realize is that all the hype adds to the prestige of the game, as opposed to diluting it.

    Published on: February 1, 2010

    • The New York Times reports this morning that today, PepsiCo will formally introduce “an ambitious campaign named the Pepsi Refresh Project, aimed at doing well by doing good. The brand is dedicating at least $20 million through the end of the year for donations to local organizations and causes proposed by the public in realms like health, arts and culture, the environment and education.

    “Ideas for Pepsi Refresh grants can be submitted each month to a Web site (, where computer users can subsequently vote on the ideas suggested during the previous month.” The campaign will be hyped by celebrities who will be appearing all overt the place to lobby for their pet causes.

    Pepsi has made the point that it is investing in this campaign instead of more glitzy commercials on the Super Bowl, which it is forgoing this year for the first time in almost a quarter century.
    KC's View:

    Published on: February 1, 2010

    Whole Foods announced last week that it is creating a program that will offer bigger discounts on food to its healthiest employees, which it hopes will encourage workers to adopt healthier lifestyle habits.

    One MNB user responded:

    I think it's well meaning, but the wrong direction.

    What's the definition of healthy?  So many health 'trackers' are hereditary.  Granted, the age of Whole Foods employees are on the younger side, but if they're going to measure the health of the employee, it should be a more holistic approach that takes into account several factors instead of just a few.  For example, I have diabetes.  It's not due to unhealthy habits.  Whole Foods wouldn't 'save on healthcare costs' with me, yet I eat very healthy, utilize portion control, and exercise daily.  My cholesterol (triglycerides) are not where they should be, but it's no based on my eating habits.  So, are they going to use a blood panel and body mass index to discriminate against hiring someone like me?  Or use age discrimination to keep a younger employee base which costs less to provide healthcare to?

    Again, it's well meaning, but doubtful that many would find it "empowering and fun".  If they're going to measure 'health', then they should consider program where they offer 'unhealthy' employees the higher discounts, which they get to keep if they continually show progress in becoming healthier.  Plus, if you give everyone the higher discount -- you only get to keep the higher discount if you 'maintain your health'.   If you're healthy (rewarding the ones that are already doing a good job) or if you show improvement in your health (if you have high blood pressure, cholesterol, etc), then you are asking everyone to improve and/or maintain good health.  Isn't that the overall goal?
    Point:  Bad Idea.

    But one Whole Foods team member disagreed:

    I am so excited about the new testing. I think it’s a great way to reward Team Members for the efforts they make to be healthy without penalizing others. Everyone gets the 20% discount no matter what. But if I eat well and exercise and don’t smoke I’m rewarded (it’s a voluntary screening, by the way). It in no way affects our health plan or benefits. In this country, my premiums are necessarily higher because other inconsiderate people smoke and force their health issues on the system. But here, there is an incentive to be well. I know that I won’t get the top discount tier, because my cholesterol has always been high. But, I will do well in the other categories. And the way that I shop here, any increase in my discount will probably save me $1000/year more.

    We had a brief obituary last week for J.D. Salinger, the reclusive author of “Catcher In The Rye,” who died last week of natural causes at age 91. It prompted MNB user Rosemary Fifield, of the Co-op Food Stores in New Hampshire, to write:

    J.D. Salinger, known as "Jerry" to the locals, was a regular shopper in our Hanover, NH, store. It was always fun to see him, knowing that the paparazzi searched in vain. The locals took great pride in protecting his privacy, and a favorite activity at the Cornish country store was sending the Salinger-seekers "into the weeds" with bogus directions.

    There is, by the way, a terrific story about Salinger’s habits in today’s New York Times. It makes clear that Salinger was a private man as opposed to a recluse ... which is the point that Rosemary Fifield is making.

    MNB user Michael Eardley opined:

    There are a lot of good writers  and writing out there in today’s world but the great are getting extremely rare. Does anyone have time to write the great American novel today? Will our culture of “getting it done today” allow it?


    We had a story last week about how Tesco in the UK is posting signs imposing a dress code on shoppers, and specifically banning them from wearing pajamas while shopping.

    My comment:

    This simply would not fly in the US. It is my impression that, at least in this neck of the woods, teenagers - mostly girls - love to wander around in their long pajama bottoms...usually worn with a pair of Uggs and a sweatshirt. (Trust me on this one. One of these girls lives in the same house as me.)

    It isn’t my favorite look. But it could be a lot worse.

    But MNB user May S. Carpenter disagreed:

    I, for one, would definitely prefer shopping at stores that requested/required appropriate dress, i.e. no pajamas.  Just because people like to wear their pajamas in public, doesn't mean it should be acceptable.  Put on a pair of jeans, for goodness sake!  What, your jeans aren't comfortable?  Well then learn how to buy clothes that fit!
    Applause to Tesco UK for this action.

    I repeat: It could be so much worse than pajama bottoms. (And I’ve seen some jeans, by the way, that look a lot less “appropriate” - whatever that means - than pajama bottoms.)

    In my view, you pick your battles. This is one that I would not pick, and I think Tesco is silly for doing so.
    KC's View: