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    Published on: September 7, 2012

    by Kevin Coupe

    As Amazon introduced both updates to its Kindle line of tablet computers and a new version called the Kindle Paperwhite (details of which you can read here), it also released a new commercial, first seen during Wednesday night's NFL season opener.

    The commercial can be seen as Amazon's version of Apple's iconic "Think Different" ad, and is worth seeing - not just because it effectively positions the company for consumers, but also lays out for both its online and bricks-and-mortar competitors exactly how it will challenge them, today and in the future.

    You can watch it here, and pay close attention to some of the lines that are used.

    "We're the re-inventors of normal."

    "We dream of making things that change your life, and then disappear into your everyday."

    "When we build you something new, you can expect everything to change a little more."

    "What once was wildly impractical is now completely normal. And normal just begs to messed with."


    Look at the wording. "We dream of making things ... when we build you something new."

    It strikes me as Eye-Opening that Amazon is no longer positioning itself as a seller of things, but as a builder of things that challenge conventional wisdom.

    In other words, a force to be reckoned with.

    Pay attention.
    KC's View:

    Published on: September 7, 2012

    The Associated Press reports this morning that food cooperatives all over the country are making changes in how they operate - eliminating slow-moving SKUs, and expanding and renovating their stores - because of existing or expected competition from Whole Foods and Trader Joe's.

    "With demand for organic, natural and specialty food continuing to outpace other segments in the grocery industry, co-ops say they must improve their stores, identify trends and appeal to a changing audience as the competition moves in," the story says.
    KC's View:
    Co-op food stores have enjoyed a unique niche for some four decades, as they've parlayed customer ownership and a focus on local, natural and organic foods into a neighborhood orientation that has been a differential advantage.

    That said, these stores need to take the competition seriously ... and I'm glad that they are not taking their market positions for granted. I've always said that if I had a co-op near me, I'd certainly shop there; maybe even sharper competition will create an environment that will allow one to open somewhere close by.

    Published on: September 7, 2012

    USA Today this morning reports that Sears Holdings has announced that its two retail banners - Kmart and Sears - "will drop all layaway fees year-round and allow shoppers to put any item on layaway at nearly all of their stores."

    The decision comes after the announcement earlier this week that Toys R Us was eliminating its layaway fees through the end of October, and that Walmart was lowering its layaway fee from $15 to $5.
    KC's View:
    D'ya get the feeling that things are going to get ugly as the holidays grow closer?

    Published on: September 7, 2012

    The Sacramento Bee reports that in Northern California, unionized employees of save Mart Supermarkets are returning to the polls this week to re-vote on a contract that the United Food and Commercial Workers (UFCW) says is "distasteful," but necessary if the retailer is to survive.

    The employees rejected the contract offer earlier this summer, even though their counterparts in the Central Valley approved it. The UFCW has said that if the union does not make certain concessions, Save Mart will be in the position that it will have to close stores, which will result in the loss of jobs.

    The Central Valley employees do not have to vote because of their prior approval. The ballots are scheduled to be counted tomorrow.
    KC's View:

    Published on: September 7, 2012

    Home Media Magazine reports on a new study from the NPD Group suggesting that the bloom may be off the video game rose, and that "while more than 210 million people in the United States play video games, that figure is down 12 million (or 5%) from 2011," a trend that seems consistent with "monthly declines in sales of new and used games and hardware."

    However, the story notes that "only mobile gamers and digital gamers saw increases in the number of users when compared with 2011.

    "The mobile gamers segment reached 22%, up from 13% last year, while digital gaming is up 4 percentage points to 16%. All other segments, which include core gamers, family and kid gamers, light PC gamers and avid PC gamers, experienced declines, with the family-and-kid segment experiencing the most significant decline of about 17.4 million players."
    KC's View:
    Not hugely surprising, when you consider how mobile technologies are affecting so many industries. But worth noting, because it suggests how marketers have to position themselves to appeal to the next generation of shoppers.

    Another reflection of how things are changing - the IBM Enterprise Marketing Management Fifth Annual Online Retail Holiday Readiness Report, which says that "mobile sales as a percentage of total Web site sales hit 16 percent a month ago," compared to six percent a year ago. That number could hit as high as 20 percent within the next four years, studies suggest...

    Published on: September 7, 2012

    Bloomberg reports that BJ's Wholesale Club "is seeking $1.625 billion in loans to refinance debt and pay a dividend." BJ's was acquired last year by Leonard Green & Partners LP and CVC Capital Partners.

    • The Florida Times-Union reports that "Winn-Dixie has donated a 50-foot refrigerated semi-trailer containing about 13,000 pounds of food to Second Harvest North Florida ... The semi-trailer will replace an existing one that is no longer road-worthy and is being used as an auxiliary refrigeration unit to store perishable food items. The food will help restock the Second Harvest's Jessie Street warehouse, which has been nearly emptied of nonperishable food inventory by increased demand and a decreased food and monetary donations."

    • The Jacksonville Business Journal reports that six months after getting into the foodservice business, Acosta Sales & Marketing is acquiring four companies in the segment - United Foodservice Sales, Innovative Foodservice Marketing, Premier Sales Associates and Joyner Brokerage Company.

    • The Milwaukee Journal-Sentinel reports that "in 2011, total U.S. beverage milk sales were 53 billion pounds - about 6 billion gallons - the lowest level since 1984, according to U.S. Department of Agriculture figures released in August. Whole milk beverage sales in 2011 were less than half their level from the early 1980s, according to the Agriculture Department."

    The reason: "Shifting consumer habits and a flood of new beverages in the marketplace, including sports drinks and bottled teas, have taken a toll on beverage milk sales..."
    KC's View:

    Published on: September 7, 2012

    • Save Mart Supermarkets announced that it has hired Eric Nadworny, a former Ross Stores, BJ's Wholesale Club and Shaw's Supermarkets executive, to be its new chief human resources officer and chief legal officer.

    At the same time, it has hired Greg Hill, formerly of Price Waterhouse, to be its new CFO.
    KC's View:
    A few thoughts on a tangential executive issue, if I may...

    There was a lot of coverage last month of the decision by NBC to cut the budget for "The Tonight Show," which resulted in some layoffs, and the move to by host Jay Leno to reduce his own considerable salary as a way of preventing even further layoffs.

    Well, the Wall Street Journal reports this morning that Leno actually took a 50 percent pay cut, while simultaneously extending his contract by another two years.

    That's right - 50 percent.

    Now, it is important to put this is some sort of context.

    The cut means that Leno will make $15 million a year, not $30 million. The costs of producing "Tonight" apparently had gotten bloated - in part going back to NBC's failed attempt to move Leno into a prime time gig while giving 'Tonight" to Conan O'Brien - while simultaneously profits had fallen from the Johnny Carson days when the show was a cash cow. (Part of this is because more competition has siphoned off viewers, and ad rates aren't what they used to be.)

    But while the business may be show business, the story seems familiar. Costs rise, competition grows, and suddenly an enormously profitable business becomes less so, and the folks at the top start looking for ways to cut their way to prosperity - and the first people to go are the support staff who nobody sees, but who help make the product function.

    What is important, I think, is the highly symbolic move made by Leno. Unlike some other organizations, where executives don't take cuts and even look for retention bonuses that will reward them for sticking around to finish the job they were paid for in the first place, Leno's move is noteworthy.

    Sure, the context is different. The numbers are inflated, even by big business standards.

    But there's leadership. And then there's covering your own rear end.

    I'm not a Jay Leno fan. I don't think he's that funny, and I'm old enough to fondly remember the Carson tenure on "Tonight.". Give me Jon Stewart and Stephen Colbert any day.

    But today, I like Leno a lot more. I think he showed us something.

    Published on: September 7, 2012

    • Art Modell, who gained fame and respect in profession football for helping to engineer the merger of the National Football League and the American Football League, not to mention helping to negotiate TV contracts that have changed the face and economics of the sport, but who also was excoriated for moving the Cleveland Browns that he owned to Baltimore after he couldn't get a stadium deal in Cleveland, has passed away at age 87.
    KC's View:

    Published on: September 7, 2012

    Yesterday, I did a FaceTime commentary about why accuracy and transparency are important in business - and used the recent exaggeration by GOP vice presidential candidate Paul Ryan of his marathon finish time as an example of how easily things can be checked and challenged.

    Which led MNB user Jim Martin to write:

    Good point about transparency, accuracy and trust.  However your comments are blatantly partisan... by singling out just one politician, you've exposed yourself as covert, inaccurate and untrustworthy.

    First of all, even though the contest is officially closed, I'm thinking that "Covert, Inaccurate & Untrustworthy" ought to make it into the finals in the MNB Mantra competition.

    Second ... Really?

    I'm curious what you thought was covert about it. Anyone who reads MNB knows that I would have done that same commentary about any politician who misstated his or her marathon times. Regardless of party. And I also emphasized that I did not think that the misstatement would affect anyone's vote, but served mostly as a cautionary tale.

    As for being inaccurate ... I think I stated my marathon times accurately. I think I stated Paul Ryan's marathon time accurately. And I don't think he did.

    And untrustworthy? Well, that's ultimately up to you folks ... though the one thing I hope you do know is that you can trust me to stir the pot each morning and occasionally letting it boil over.




    The other day, I wrote the following headline:

    Study: Organic Food No Better For Consumers Than Conventional Food

    But one MNB user thought I underachieved:

    Wow - can't believe the easy way out headline you used, KC. 

    Here are some other headlines you might have considered. 

    NYTimes:
    Study Questions Advantages of Organic Meat and Produce ...

    Examiner:
    Stanford study finds organic food is safer to eat

    Chronicle of Higher Education:
    Emphasizing the Negative, Stanford Draws Wide Audience for ...

    LATimes:
    Organic Food - better for you or not? A study takes a look




    MNB user Carter Calico wrote:

    I enjoyed the article about Walmart’s iPhone application and had a few thoughts about the comments from ‘Your Views’:

    • Theft: Why not put a weight in the cart similar to that at the self checkout? Not infallible, but a step in the right direction

    • ‘Big Data’: Isn’t this the first step for brick and mortar? The ability to see the shopper’s path, other items in their basket, etc. Why not offer the shopper the most efficient route or the route with like items also purchased with their basket? Why not give digital coupons that can be applied when additional items are purchased?

    • Jobs: This idea can work if the jobs lost at registers are reallocated. Inevitably, some jobs will be lost, but others could be transferred to hot spots throughout the store offering advice/demos/coupons to get customers more involved.
     
    The fact is, this technology is here. The ability to capitalize on the opportunities it brings is the only question that remains. Use the data that is gathered and sell the shopper what they want to buy!





    On the subject of Safeway's decision to do an IPO for its Blackhawk gift card subsidiary. MNB user John Gillis wrote:

    I foresee a shift in this category, It's just a matter of time retailers will figure out that one way to fight against the show rooming and the monster that is Amazon, is and will be Social Gifting. Being able to give someone a gift card on their phone through the huge Social Networking sites I.e.Facebook, Twitter, Linked In… 

    Wouldn't It be nice to be able to go on Facebook and check your birthdays and in one fell swoop wish your niece across the country a Happy Birthday along with giving her a Gift Card to Best Buy, Target, Gap etc…Think about it, they will never lose it and will be on their phone when they do want to redeem it. The show rooming Caveat could be that they need to go to the retailers brick & mortar to redeem, which could mean incremental sales and more transactions.

    With that being said, I think it will only be a matter of time before physical gift cards and payment services will be handled through the retailers electronically?





    Yesterday, a story about Food Lion contained the following passage:

    "The new strategy encompasses lower prices, more convenience, improved service, greater value in private brands and better produce, and the company has been adding jobs at the retail level. Phillips-Brown put the number of new retail jobs at 2,100 this year."

    Which led MNB user Bryan Nichols to write:

    Any organization that considers this a new strategy is in serious trouble.  It sounds more like a minimum expectation and something that all retailers should be doing everyday just to stay relevant.
     



    From MNB reader Jarrett Paschel, the following email:

    It seems like almost every day in the trade press and analyst community that there is a news story about Tesco, Walmart or SuperValue, and the stories are almost always negative.

    Meanwhile we really do hear very little about Kroger, Sainsbury's, Publix, HEB/Central Market, etc. Of course one could argue that this observation is merely a reflection of size--the bigger they are, the more coverage they receive.

    Another explanation might be something like the following: In a land populated by clumsy dinosaurs with tiny brains stomping around looking for food to stave off extinction, there are plenty of other creature going about their business who have quietly adapted to their environment and will likely outlast the dinosaurs for many years to come.


    Point taken. Though I'm not much interested in size. I'm more interested in stuff that strikes me as thought-provoking.




    Got the following email from MNB user Jeff Folloder:

    The foundations of excellent customer service are ubiquitous and easily translate into other industries and verticals.  Case in point: a few weeks ago I had the need to secure a quantity of a very specific type of firearm ammunition for a demonstration that I had scheduled.  This is not run of the mill stuff and availability is scattered.  Additionally, it is worth noting that the price for identical product is quite varied with no apparent reason for high versus low pricing.  I wielded my "Google-fu" search skills and came up with a low cost option.  I inquired directly, had an email and voice conversation with a sales rep, decided on a quantity and placed my order.

    As expected, the order arrived without ceremony or fuss and I did the demonstration without incident.  Last week I received an email from the sales rep.  "I just wanted to follow up with you on your recent purchase to be sure the order was processed properly and the product you received was acceptable. Have you had the opportunity to use the ammo you ordered and did it meet your expectations? Your input is greatly appreciated in order to better serve our customers. "  I was floored!  Let me count the number of times this has happened to me before in the firearms business... NEVER!  I absolutely responded to him in the positive.  I can assure you that he has a customer for life.  And I can also assure you that *I* now have learned from the experience and will be sending out such requests for feedback on the stuff that I make.  When folks are grading you on price alone, a great customer experience can make you stand out.





    On the subject of healthier food at McDonald's, one MNB user wrote:

    After we tried to get my son, a huge Subway fan, to order a salad from McDonalds, on a recent road trip, he sent us a quote he found somewhere online. This article reminded me of it. “Going to McDonalds for a salad is like going to a prostitute for a hug.”

    Kids say the darndest things, don't they?




    I love emails like this one, from MNB user Sue Seisler:

    By the way….loved “Longmire”, adored “Newsroom,” and can’t wait till “Homeland” and “Sons of Anarchy” (my dark side guilty pleasure) start up.  Love your column and actually missed you last week!  Hope your time off was relaxing and memorable!

    Mostly it was doing things like cleaning the garage and reading. But sometimes that can be the perfect vacation.

    I'm with you on "Longmire" and "The Newsroom," and I am a recent convert to "Homeland." (We just added Showtime to our package, and are totally addicted to it ... we're nine episodes into the 12-segment first season, and it is fabulous.) One of my sons is a big 'Sons of Anarchy" fan, and the other loves "Breaking Bad."

    Thank goodness for DVDs and On-Demand...
    KC's View:

    Published on: September 7, 2012

    Two of my favorite fictional characters return in new novels being published next Tuesday, and the books show very different stages of development for the two novelists.

    • In "Fool Me Twice" (Putnam, $25.95), Michael Brandman takes his second shot at following in the estimable steps of the late Robert B. Parker, writing about Jesse Stone, the alcohol-challenged Los Angeles detective transplanted to Paradise, Massachusetts, as the local police chief. Brandman is the longtime collaborator with Tom Selleck on the Jesse Stone movie series, and so he is familiar with the territory.

    As I noted with Brandman's first effort - "Killing The Blues" - he does not seem to be a natural novelist (not like Ace Atkins, who is writing the new Spenser books and is a terrific novelist in his own right), but the second book strikes me as much better. He's finding his stride, and he was smart in this one to write about a Hollywood film company shooting in Paradise - it is a scene he knows well, and it plays effectively against a murder plot. He also delves into an interesting subplot about a collision of cultures - there's a rich girl who accidentally kills someone while driving and texting at the same time, and her parents' first instinct is to blame everyone but her. Needless to say, Jesse takes exception to this approach, and takes an unorthodox approach to dealing with it. I cannot help but feel that Parker would have dealt with both plots with sharper prose and perspective, but Brandman delivers a serviceable novel that keeps a favorite character alive and growing. That's good enough for me.

    • "A Wanted Man" (Delacorte, $28) is the latest Jack Reacher novel by Lee Child, and this 17th book shows that Child is comfortable enough in his own skin to have a little fun and try something different. I suspect he's being a little puckish when he talks about Reacher, a former Army MP wandering the back roads of America, as being a huge man who at the moment has a face that is battered and bruised and anything but handsome; he goes out of his way to write about how Reacher is a lousy driver and not a fast runner; he's strong, big and immovable. In short, he's everything that Tom Cruise is not, which is funny since Cruise is playing Reacher is a much-anticipated movie coming out this Christmas.

    There has been a lot of skepticism about this casting, especially among hardcore Reacher fans - the character's physicality and immensity are critical to the character, and it is hard to imagine Cruise even approximating them on screen. And so, it is sort of funny to read "A Wanted Man" and see Child emphasize so many of the elements that Cruise won't be able to capture. He's also challenged himself as a writer - much of the first two-thirds of the book take place with Reacher riding in a car, but those chapters are never less than compelling and tension filled. I liked it a lot, and I already can't wait for the next tone. (And yes, I'm even looking forward to the movie...)

    Both books are available in bookstores and as e-books on Tuesday. Enjoy.




    While you are reading, I have a couple of wonderful wines for you to sip ... the 2010 Francis Coppola Black Label Pavilion Chardonnay, which is always a good bet ... and the 2009 Willamette Valley Vineyards Estate Chardonnay, which is from one of Oregon's best wineries and not only thrilled my tastebuds but made me homesick for Portland.




    That's it for this week. I'm really looking forward to this weekend ... a longtime MNB reader named Henry Stein - who I never have met - sent me an email a couple of months ago inviting Mrs. Content Guy and me to attend with him this evening's Bruce Springsteen concert in Chicago's Wrigley Field. So, we're catching a plane to Chicago in a couple of hours and will be rocking on the infield tonight.

    Thanks, Henry. Your generosity is touching, and I'm looking forward to meeting you, just as I always enjoy meeting MNB readers wherever I go.

    I hope you have a great weekend, too...and I'll see you Monday.

    Sláinte!
    KC's View: