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: November 29, 2011

    by Michael Sansolo


    There are countless reasons why history might remember 2011 as a momentous year. Technological advances, the economy, the Arab Spring and the on-going European financial meltdown are likely to influence events for years or decades to come. So here’s hoping history quickly forgets “The Friday Song.”

    If somehow you managed to miss “The Friday Song” phenomenon, I apologize in advance for bringing it to you. Go to YouTube, look up the original song and hit play. Then prepare to spend endless time trying to get the awful song out of your head. There’s a simple reason why I can be so certain you’ll hate it. Since the song, performed by California teenager Rebecca Black, appeared on line in March it has been played nearly 180 million times and is one of the most disliked videos in the history of YouTube. It is simply that bad.

    So imagine my surprise when Kohl’s unleashed a version of the song as its Black Friday ad. Although it’s a clever play on words how could Kohl’s pick such a horrible song to pump such an important day of shopping? Apparently, because Kohl’s is far smarter than I am.

    The ad was one more way for Kohl’s to stand out from the crowd. Whatever you feel about Kohl’s, this much is beyond argument: the chain knows how to sell stuff. Everything there seems to be on a 45% off sale every day of the year (or 60% off with coupons) and that plays perfectly with Kohl’s shoppers. Sales are up solidly this year and the buzz from Black Friday was excellent. Yet the ad did even more.

    As Sarah, my daughter and cultural advisor on Gen Y issues, explained to me, the ad shows how Kohl’s gets it. It showed a sense of humor and a connection to current popular culture. Yahoo’s Shine magazine and countless other media observers agreed with Sarah saying the Kohl’s ad was irritating, yet it remained the only truly memorable ad from the entire pre-Thanksgiving blitz.

    The discussion with Sarah reminded me of a challenge I give audiences frequently in speeches: the need to listen to those different than us. Because of her age (24), Sarah’s perspective on so many things in life is very different than mine. Sometimes we differ significantly, sometimes slightly, but because I respect my daughter’s intelligence, I try to listen. And because of that, my perspective on Kohl’s Black Friday song changed.

    Yet what makes Thanksgiving great (beyond stuffing, gravy and pecan pie) is family time. After Sarah educated us on Kohl’s, my wife and I were able to provide our own pop culture lesson. Sarah joined us for a Beatles’ tribute concert, performed in a creative way by a group that literally recreates cherished old record albums. Luckily Sarah actually knows what an album is and who The Beatles were.

    What she didn’t know was the breadth of their work and it shocked her to learn that specific songs she knew were written and performed by the Fab Four. For instance, Sarah knew the beautiful song “Blackbird” from two sources: it was once performed on “Glee” and was featured in a computer game called “Kingdom of Loathing.” Now she knows it was originally a Beatles song.

    With that the lesson came full circle. No matter who we are, we have so much to learn from other generations and other ethnic and racial groups. All of that learning will help us understand so much about the modern world and help be current and relevant. Yet there is also so much we have to teach them and when we do that we make our families, our teams and our companies stronger. It all starts with listening and sharing, which is something we need to do more both at work and at home.

    One last thing: when you go to YouTube, search for “Blackbird” instead of “The Friday Song.” You’ll thank me.


    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 .
    KC's View:
    It was interesting to read Michael’s column when he emailed it to me yesterday, because at about the same time I received an email from an MNB user who had a different reaction to the same Kohl’s commercial...

    My wife and I were not happy with the Kohl's ad (and I like Kohl's, having lived in Wisconsin) that showed the woman stealing a garment from another woman's basket and cutting in front of an older woman at the checkout line (I think) while singing a stupid song.  The ad was unethical in my/our view.

    They were talking about the same ads - but while Michael picked up on the music, this user found the implicit approval of obnoxious behavior to be disconcerting. (When Michael and I chatted about this, he agreed that that the visuals were disturbing.)

    I know I’ve been harping on this for the past few weeks, but for some reason I find the whole lowest common denominator approach to holiday marketing to be unsettling. Not sure it is much worse than in past years - though maybe the stakes are higher because the economic situation seems more desperate - but it just seems more exploitive. And I’m not sure that marketers, by appealing to desperation and adopting lowest common denominator approaches, are doing themselves any favors in the long run.

    Published on: November 29, 2011

    by Kevin Coupe

    The Los Angeles Times reports this morning that if you want to give all the 78 presents mentioned in “The 12 Days of Christmas” for the holidays this year, it will cost you $24,263.18 - up 3.5 percent from a year ago.

    Shopping online for all these items actually would be more expensive, says the report from PNC Wealth Management - it would cost $39,860 this year -– a 16.1% increase from last year due to high shipping costs.

    According to the Times, the report says that it is birds that are really getting pricey - apparently swans-a-swimming, partridges, and turtle doves cost a lot more than they used to. Inflation does not seem to have affected maids-a-milking, ladies dancing and lords-a-leaping. And, oddly enough, five gold rings are cheaper - while the cost of the metal is high, prices are down because of competitive retail pricing.

    Just in case you were putting together your holiday shopping list...
    KC's View:

    Published on: November 29, 2011

    USA Today reports this morning that yesterday’s Cyber Monday promotions - the online response to the post-Thanksgiving Black Friday weekend sales - appears to have generated 43 percent more online traffic than a year ago, and sales that were up 18 percent compared to the same day in 2010.

    The story quotes Matt Shay, CEO of the National Retail Federation, who said that sales on Cyber Monday and over the long weekend show retail is "providing a needed shot in the arm to our nascent recovery."

    The Dow Jones story on the same subject says that “retailers are expected to post a record $1.2 billion in online sales this Cyber Monday, only the second time a billion dollars in online commerce has occurred in one day. The estimate, by online tracker comScore, compares with last year's $1.03 billion and shows the power that Cyber Monday carries with holiday shoppers.”
    KC's View:
    I think Stephen Colbert got it absolutely right last night on “The Colbert Report.” These numbers show that America is back - that Americans once again “are spending money they don’t have on presents that nobody needs to give to people that they don’t like.”

    Published on: November 29, 2011

    The Seattle Times reports this morning that when Craig Jellinek becomes CEO of Costco on January 1, he will receive an annual salary of $650,000 plus a performance bonus of up to $200,000.

    According to the story, “That compares to current CEO Jim Sinegal's salary of $350,000 and bonus of $190,400 in fiscal 2010. Including stock awards and other pay, he received $3.5 million. As president and chief operating officer, Jelinek earned a salary of $635,000 plus a $95,200 bonus that year. With stock awards and other pay, he received $2.3 million.”
    KC's View:
    Sinegal’s salary always has been a matter of pride for both him and the company he co-founded, because he felt it made a statement about the importance of the front lines. Jellinek’s salary only seems high because it is double Sinegal’s base pay ... though it hardly seems fair to ask him to take a salary cut at the same time as he gets a promotion. This is, however, something that Costco needs to be sensitive to - cultural imperatives can be fragile, and it has to be careful not to change a long-established storyline.

    Published on: November 29, 2011

    Bloomberg reports that “Amazon.com Inc. and Wal-Mart Stores Inc. are prodding more manufacturers to change their packaging to cut waste and alleviate ‘wrap rage,’ the frustration felt when a product is difficult to open. The nation’s largest online store and the world’s biggest retailer have been pushing vendors, including Procter & Gamble Co. and Bluetooth headset maker Plantronics Inc., to eliminate excessive and cumbersome packing materials, such as hard plastic clamshell casings that enclose electronics and wire ties used to secure toys to cardboard backings.”

    The story notes that “as much as a third of all consumer trash sent to landfills is estimated to be packaging, according to the Environmental Protection Agency. That translates to more than 800 pounds of packaging waste each year per U.S. consumer.”
    KC's View:
    They help rid the world of hard plastic clamshell casings, and I think they ought to get nominated for a Nobel prize, Oscar, and maybe the Congressional Medal of Honor. I’ve ordered stuff from Amazon and chosen frustration-free packaging, and it is just great. Hell, I’ve already bought to item - who cares if it comes in a plain brown wrapper?

    Published on: November 29, 2011

    Attorneys with Pacific Legal Foundation have petitioned the U.S. Supreme Court on behalf of the California Grocers Association to review a City of Los Angeles ordinance that denies new grocery store owners the right to hire their own employees, unless they agree to maintain a unionized workforce.

    According to CGA, “The petition asks the Court to review the city’s Grocery Worker Retention Ordinance, which requires companies that purchase grocery stores of 15,000-square feet or larger to hire employees only from existing staff and retain them for at least 90 days. This restriction does not apply if the new owner consents to a collective bargaining agreement with a union.” CGA described the law as “a major step backwards in a national effort to bring affordable and healthy food to some of the most underserved areas in Los Angeles.”

    “While we’re extremely disappointed with the California Supreme Court’s decision, we are encouraged that the Pacific Legal Foundation finds merit in petitioning the highest court in the land,” said Ron Fong, CGA President and CEO. “The challenge is important enough to grocers that CGA believes it needs to exhaust every legal remedy.”
    KC's View:
    I suspect that the Supremes will rule in favor of CGA in this case (though I have absolutely no legal basis for that opinion). But it is hard to imagine why a new owner of a business has to adhere to labor agreements made by an old business that may have actually put the old entity out of business.

    Published on: November 29, 2011

    Advertising Age reports that while “Walmart isn't owning up to any blanket campaign to better leverage employees as brand ambassadors,” the retailer seems to be moving in that direction by “revamping its internal employee social network and switching publishers as a prelude to beefing up its in-house magazine, Walmart World, with both more content and outside advertising. The latter could prove an even greater magnet for brand marketers trying to sway Walmart's in-house influencers, particularly now that the chain is allowing local managers more ability to green-light items and is encouraging employees to promote specific items in their stores.”
    KC's View:

    Published on: November 29, 2011

    • In the UK, JohnLewis.com has installed a virtual shopping experience in the front display window of a Waitrose supermarket, allowing shoppers to use their smartphones to scan QR codes on 30 popular products, buy them with one click, and then have then delivered to their homes or offices the next day.

    The virtual store will be up and running through the end of December.
    KC's View:

    Published on: November 29, 2011

    with occasional brief commentary in italics...

    • The Economic Times reports that opponents of changes in Indian law that would make it possible for foreign retailers to own 51 percent of chains operating there - a shift from previous rules that mandated joint ventures with local businesses having the controlling interest - are issuing threats against global chains looking to operate ion India.

    According to the story, “SP leader Mulayam Singh Yadav repeated the threat of BJP leader Uma Bharati to set Walmart stores on fire” if they open there. "Our stand is that we will burn any such shop in the state and we will not allow it," he said.

    Apparently, Gandhi was not required reading in certain Indian schools.

    Reuters reports that the US Department of Justice’s antitrust division is investigating KKR & Co.’s recent $4 billion takeover of Del Monte Corp. The takeover was opposed by some shareholder groups and currently is the focus of a lawsuit that is seeking class action status.

    The Louisiana-based Robért Fresh Market chain, with three stores in New Orleans and Metairie, said yesterday that it is adopting the NuVal nutritional scoring system, which assigns scores of 1-100 to virtually every product in the supermarket - the higher the number, the more nutritious the item.

    Crain’s Chicago Business reports that “Sara Lee Corp. plans a major image upgrade of its meat brands when the company splits its North American retail unit from its international coffee business next year, according to a report.” The company apparently “intends to remake its Hillshire Farm lunchmeats and launch two premium deli brands around the notion of handcrafted farming, curing and butchering practices.”
    KC's View:

    Published on: November 29, 2011

    From MNB user Kat Shumway:

    I just read your article on the new UP by Jawbone.  I, too, was very excited for this product launch.  The first big miss was the product availability upon launch which I didn’t see mentioned in the article.  To this day you still can’t order a colored band from Jawbone and even finding a black one in a retail store is tough.  Having said that, I did finally find one (a black one) and have used it for a couple of weeks.  Yes, communicating to the app would be cool but I wonder about the impact on the battery life which is pretty good right now.  While it doesn’t seem very cool, syncing twice a day is easy, works well and still allows me meet my daily step goals.  What is missing is any way to add my food intake from a calorie perspective.  I don’t take pictures of my food and adding how I feel might be “nice” to have, but what I really want is a way to track calories in and calories out.  There are many apps that do this today…..Jawbone needs to add this functionality to the very next release of the app!  I suspect it is on the list but hope to see it very soon.  This will take this device/app a long way to help with my “fitness” goals.




    From another MNB user, regarding Black Friday sales:

    What I hope all taken into consideration is the following:

    First comp sales are all messed up as some retailers opened on Thursday, some open earlier on Thursday then last year. Some started their Black Friday sales Thursday vs. Friday last year. Some on Friday started their sooner than they did last year….

    While sales were up, this year so were the price points. TV’s, washer and dryers, I Pads, Tablets, Laptops….

    Some retailers open both black Friday and cyber Monday online sales early

    Kohl’s, gave an extra $5.00 cash bonus.

    And we have yet found out what Profits are after the free shipping, labor, security, etc is factored in…


    Another MNB user, describing himself as a Kmart manager, wrote:

    Kmart was a huge exception to the rule- company was down in the neighborhood of 30% vs LY on Thanksgiving- Black Friday sales were down between 10-30% across the US. Not "executing the plan" is what emails from regional managers blamed the slump on- in the stores we knew it was due to a lackluster ad, run down stores, and not enough of an emphasis on real customer service. How many years can you go on with no product to support ads and no personnel to serve the customers who might be willing to give you one shot to take care of them? I think we just found out. 

    They/we either have to figure it out quick, or just stop playing. Leadership touts online growth, but overall sales continue to fall. We are not attracting new customers; it looks like we're just cannibalizing from our B&M locations and giving our loyal core of customers another reason not to set foot in our outdated, archaic stores.

    It may be time to freshen up my resume....





    Responding to yesterday’s piece about youth hostels as a business opportunity, one MNB user wrote:

    I am glad that someone is finally picking up on this idea!  I started traveling around Europe in college and normally had great experiences.  So great, in fact, that I continue to stay in youth hostels today when I travel to Europe.  Many of them offer private rooms and private baths, just at cheaper costs than a regular hotel.  Most recently, I traveled around Italy earlier this year with my mom and we chose to stay in hostels based upon high reviews on hostelworld.com.  In each location, we had a great experience, only choosing to stay in a hotel in Rome due to the lack of private rooms available.

    The primary reason that I’ve stayed in hostels is due to the fact that I like meeting fellow tourists.  I have consistently found that hostels are environments where people want to meet and sightsee with one another.  I have made some great friends in hostels that I continue to stay in contact with. I will usually choose to stay in a hotel when I am looking for a more private travel experience.


    And, from another MNB user:

    As a parent who hopes my children want to take some time to see the world one day (and the person who will likely fund at least some of that exploration), I LOVE this idea. Give me some peace of mind to cling to, perhaps illogically. Of course, Miami isn’t my idea of seeing the world so I hope they extend to Europe and other locales.



    MNB had a piece yesterday about Staples licensing the Dunder-Mifflin name from “The Office” for a new line of copy paper that it hopes will reverse sales decline in that category, and I said that they were missing the bigger picture - that paper and ink are dying, and all the licensing deals in the world may not matter.

    One MNB user replied:

    I was at an International Paper plant for meetings recently and the first portion was all about sustainability given IP is in the forest products business and a couple of things struck me.  One,  there is more land under forest in the US now that there was in 1940, and two, the use of copier paper actually encourages the planting of new trees.  So print that page and cause a tree to be planted !!!  An interesting concept that is counter intuitive.




    And MNB user Bob Savage followed up on one of yesterday’s RIP notes:

    Our industry certainly lost one of its larger than life characters last week with the passing of Jeno Paulucci. I had the privilege of working for him for almost five years and like anyone that has been around him for much time, have a lifetime of stories about the experience. While at times, he could be harsh and impatient, deep down he cared for those in need and did many things about it. What I will always remember about my time with him was his passion and determination to achieve his goals. He never quit. He had no use for technology but preferred working solutions out in his mind or on a simple sheet of paper. He would often have the answer before I could input all the information into my spreadsheet!  This straight-forward business process was used over and over again to achieve much success. For many of us that got to work with him closely, we were made better for just the experience of watching him work.

    Here is to the legacy of a great food industry entrepreneur that positively impacted my life and many others.
    KC's View:

    Published on: November 29, 2011

    In Monday Night Football action, the New Orleans Saints defeated the NY Giants 49-24.
    KC's View: