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    Published on: April 25, 2013

    This commentary is available as both text and video; enjoy both or either. To see past FaceTime commentaries, go to the MNB Channel on YouTube.

    Hi, Kevin Coupe here, and this is FaceTime with the Content Guy.

    One of the retailing geniuses that I've always admired is a fellow named Mickey Drexler, a child of the Bronx who pretty much defined the Gap clothing chain during the nineties, helping to establish the look and feel that made Gap so distinctive.

    As almost always happens to fashion-oriented chains, there was a time when things weren't clicking ... and Drexler was fired in 2002. Not really because anything he'd done; in fact, he'd built a company that had generated hundreds of millions of dollars in sales. And he was a merchant with a sixth sense about the fashion zeitgeist. Still, there was friction between him and the founder of the company, and one day, he was unceremoniously shown the door.

    But, he found another door to walk through - and today he is the CEO of J. Crew, which he has transformed into an equally powerful fashion juggernaut. And I have to say ... I have to love a fashion guy who wears as a uniform jeans, untucked shirts and a navy blazer.

    Well, this month's Fast Company has an interview with Drexler in which he offers "10 rules for creative success."

    If you want to read the whole piece, click here.

    I do want to highlight three of his rule here:

    1. "Companies are in the Stone Ages organizationally: You can tell by the offices ... The king is on the top floor and there are 17 people in front of the king's office. There are layers of bureaucracy. It shouldn't be like that."

    2. "America's companies are built to destroy creativity: If you become the head of a big company today, you're not the youngest person in the world. You have a contract. You get a jet. You have a huge overpaid salary. You get bonuses. Do you think that CEO is going to screw around with fast, creative change? No. And the board of directors, the last thing they want is someone who's going to change things. Steve Jobs--he would bet the company, he wouldn't care. But there are very few people who run companies that way."

    3. "You can drown in data: Data is very important, but you have to be good at reading the data in an emotional way. If you look at a selling report, there's an emotional trend to what's selling. What's a focus group? We ask, 'What's going on in the stores?' You learn and then edit, edit, edit, because there's a lot of junk mail in your head."

    I guess part of the reason I like this story so much is that it reflects some of what our priorities are here at MNB - that CEOs need to understand that the people on the front lines are a retailer's best ambassadors and best barometers, that the ability to be a merchant is, at the end of the day, more important than the ability to read a spread sheet and preach efficiency, and that the ability to foster revolution, disruption and change from within is critical to remaining relevant and maintaining growth.

    And guess what. You can do it all without tucking in your shirt.

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

    KC's View:

    Published on: April 25, 2013

    by Kevin Coupe

    The Washington Post reports that Google has introduced a new tool ... one that, to be honest, I never even thought that I would need.

    It is designed to allow people to control the data linked to people's accounts after they die.

    According to the story, "the Inactive Account Manager ... gives Google users the option to have information from inactive accounts wiped from the system ... Those who use the Inactive Account Manager can choose to have their data deleted three, six, nine or 12 months after it becomes inactive. Users can also select 'trusted contacts' to receive information from various Google services such as Blogger, Gmail, Picasa Web Albums, Google Voice and YouTube."

    Now, it is true that circumstances other than death could lead people not to access their accounts for a long period of time. But it never occurred to me that I ought to think about what happens to my digital info once I kick the bucket.

    I also did not know that Facebook "allows users’ family members or friends to memorialize Facebook pages of those who’ve died. Once an account is memorialized, no one can log into it and the account will not accept new friend requests. Facebook also removes the profiles of deceased people from its suggested lists of 'People You May Know'."

    As I said, I never really thought about this before. Though I must admit that I thought the other day about recording a FaceTime video commentary that would only be released upon my death. (Assuming something happens unexpectedly.)

    I'm gonna have to give this some consideration...
    KC's View:

    Published on: April 25, 2013

    The New York Times reports that the Securities and Exchange Commission (SEC) has been "flooded" with calls to propose new disclosure rules that would "require publicly traded corporations to disclose to shareholders all of their political donations, a move that could transform the growing world of secret campaign spending."

    According to the story, "S.E.C. officials have indicated that they could propose a new disclosure rule by the end of April, setting up a major battle with business groups that oppose the proposal and are preparing for a fierce counterattack if the agency’s staff moves ahead." However, the calls for just such a rule also could be described as fierce: "A petition to the S.E.C. asking it to issue the rule has already garnered close to half a million comments, far more than any petition or rule in the agency’s history, with the vast majority in favor of it. While relatively few petitions result in action by the S.E.C., the commission staff filed a notice late last year indicating that it was considering recommending a rule."

    Trade associations representing major public companies in a variety of industry have called for the SEC to avoid any such regulation, and some members of the US Congress have proposed legislation that would prevent the SEC from issuing regulations in this area.

    The Times writes that "while campaign finance regulations are usually the province of the Federal Election Commission, advocates for the new proposal have pressured the S.E.C. to issue its own disclosure rule. They argue that shareholders should be able to evaluate business executives’ oversight of company resources and that S.E.C. regulations already require disclosure of similar information, like executive compensation."
    KC's View:
    For a moment, let's forget the politics of this. And trust me, this has the potential to turn into a partisan hairball.

    I cannot help but think that the people and organizations that do not want this information divulged, and do not want regulations that require that such information be made available, are deluding themselves. These days, the internet makes pretty much everything knowable and findable. And what cannot be found on the internet inevitably gets revealed by people within organizations who have a problem with certain political positions and financial contributions.

    To try to prevent such information from being made public is to fight the last war. It doesn't make sense. People should look at this potential regulation and see it as an opportunity to be up-front and transparent with investors, rather than as an obstacle to be avoided or overcome.

    That all said, I have to admit that I think that such information should be public, regardless of whether the SEC mandates it or not. My feeling is that there are certain companies in which I will not invest, just as there are some companies that I will not patronize because of positions they have taken. It ought not be permissible to obfuscate such information from the people who are thinking about investing their money in such companies.

    Published on: April 25, 2013

    Wakefern announced that it has donated $1 million to The Academy of Food Marketing at Philadelphia's St. Joseph’s University – the largest ever gift to the food business school based in Philadelphia.

    The money was raised by Wakefern through its ShopRite stores and partner vendors. The company says it set the ambitious $1 million goal after raising $850,000 in 2008 and $750,000 in 2003 for the school. The funds will be used to help fund educational programs and scholarships and defray costs for many of the 540 undergraduates in the Academy of Food Marketing.

    “More young people are seeing the benefits of working in retail, which is changing rapidly and where the breadth of careers and experiences is growing," says Robert Higgins, executive director of The Academy of Food Marketing. "Salaries are rising and there is more prestige and more room for advancement and long-term careers. This donation from Wakefern will go a long way in helping us bring great young candidates into our program and the industry."

    “There are many great careers in the supermarket business, and those jobs are not just in the retail stores. There are opportunities in sales, law, marketing, purchasing and more,” says Wakefern chairman/CEO Joseph Colalillo. "We need leaders in the industry and we think an important way to grow the industry and develop future leaders is through programs like The Academy of Food Marketing.”
    KC's View:
    An amazing gift, and the kind of donation that will not be forgotten; it will resonate in the lives of young people for many years to come.

    Published on: April 25, 2013

    Netflix announced this week, now that it has surpassed HBO in terms of total US subscribers, that it plans to introduce an optional plan that will allow for up to four simultaneous streams on an account instead of two. The cost will be $11.99 a month, $4 more than the current $7.99 single user plan.

    The majority of Netflix subscribers are single users.
    KC's View:

    Published on: April 25, 2013

    USA Today reports that Starbucks CEO Howard Schultz "admits to having gee-whiz, future plans on the drawing board" for what the store of the future may look like.

    Not that he's willing to go into them "in any detail." The paper says that Schultz will only concede that it "is not only linked to the physical but the digital experience ... You'll know it's a Starbucks store, but you'll know that you'll be walking into a significant evolution."

    Here's the important passage:

    "The parameters are wide but the central focus is very clear, he says: 'If we were competing with Starbucks, what would we do?'

    "Success, he says, means never standing still. That's a concept that all innovators — large or small — must embrace, says Schultz. Many of the changes to come to the Starbucks brand will be related to new technologies — some of which, like mobile payment, are already in motion. Many of the changes will be related to health and wellness. And some of the changes will relate to Starbucks as a broader consumer brand."

    You can read the whole piece here.
    KC's View:

    Published on: April 25, 2013

    Advertising Age reports that Coca-Cola "is launching a new teen-focused digital campaign that will span across multiple websites, and incorporate a series of games, GIFs and videos."

    According to the story, "the new campaign spans 61 URLs. Each has a different number of "h's" appended at the end of the 'Ahh'," which leads to some sort of content payoff. "Different pieces of content are served up depending on how many 'h's' are entered. For example, one site gets you immersed in what looks to be a bubbly class of Coke. Moving your cursor moves the bubbles around, which emit satisfied 'Ah's' as they do so. Another site asks you to aim ice cubes into a glass of Coke, while a counter on the right shows what temperature the drink is at, the idea being .... to communicate that the best temperature to enjoy Coke is 37 degrees. Another site features the new chill-activated Coke cans performing an impressive dance routine."

    The story goes on to say that "the brand plans to create bi-weekly site reporting systems to understand which URLs are popular and which aren't. Those that perform poorly will be eliminated and replaced." Coke believes this will be a multi-year program.
    KC's View:

    Published on: April 25, 2013

    • Could it be?

    The Apple iTunes store will be 10 years old on Sunday.

    While the iTunes store started with just 200,000 songs, the Associated Press puts it into context:

    "The iTunes music store became much more than a solution; it changed how we consume music and access entertainment. It’s not only music’s biggest retailer, it also dominates the digital video market, capturing 67 percent of the TV show sale market and 65 percent of the movie sale market, according to information company NPD group. Its apps are the most profitable, it has expanded to books and magazines, and it is now available in 119 countries. This week, iTunes posted a record $2.4 billion in revenue in first-quarter earnings."

    Bloomberg Business Week reports that plans to release a set-top TV box that will challenge Apple TV as a method of streaming content. According to the story, while Amazon's content is available via other set-top boxes, "building its own gadget will help Amazon put the content more directly in front of consumers and give developers another reason to create apps for Amazon's digital platform."
    KC's View:
    Just a reminder of how much change and innovation has taken place, and how competition continues to drive. it forward.

    Published on: April 25, 2013

    • On National Pubic Radio (NPR), The Salt reports that "the frozen food industry just hired two big ad agencies for a $50 million campaign to convince us that frozen food is good."

    The story says that "studies comparing the nutrient content of frozen vegetables with fresh find that frozen ones are almost as good. But there are plenty of variables, including how long fresh vegetables have been stored since picking, how long their frozen counterparts have been interred in the home freezer, and how both types are cooked."

    The goal is to bring together a number of companies - including ConAgra, Heinz, and Kellogg - to speak in a unified voice to get the marketing message across.

    • Interesting piece from Bloomberg about how Chipotle is experiencing sluggish sales in the UK, apparently because it is perceived as having high prices and a too-stark decor. But that doesn't mean that the burrito craze hasn't kicked in: "Fast-casual eateries like Chilango, Tortilla, and Benito’s Hat are expanding in London and making forays outside the city, to regions where beans are served on toast and the Cornish pasty is the handheld food of choice." Londoners seem to prefer somewhat more adventurous food - such as roasted pork belly
    burritos and achiote braised chicken burritos - as well as a more upbeat atmosphere.
    KC's View:

    Published on: April 25, 2013

    On the subject of genetically modified salmon, which I said ought to be labeled as such if it is allowed to be sold for human consumption in the US, one MNB user wrote:

    We let plants & animals breed in the wild – where we have the potential for killer tomatoes – all types/forms of mutations & strains, yet let us modify one gene in a lab, where we have testing and all such checks & balances - yet you want the Industry to label genetically modified – like something is wrong – what’s wrong is this thinking?

    How about defending technology and all the goodness it has to offer  – and not just today’s consumers but our ability to supply good food products at reasonable prices to all people of the world!  This should be our worthy challenge.  Not fear mongering.

    To be honest, I'm having a little trouble following your train of thought, but I reject the notion that accuracy and transparency in labeling is the same as fear-mongering. (Salmon has to be labeled as farmed or wild. Why not genetically modified?)

    I'm a little surprised that someone who reads this site would suggest that I'm anti-technology "and all the goodness it has to offer." That is far, far from the truth.

    I actually think that if there is any fear in the marketplace, it is on the part of people and companies who do not believe in transparency, and apparently do not believe in their ability to explain why a product is genetically modified, what the benefits are, and why people should want to buy it.

    Your seeming inability to make that case is no reason to not require transparency and accuracy.

    Responding to our piece the other day about what Cub has to do to survive and regain its competitive footing, one MNB user wrote:

    I’m one of the 1,100 people in MN who were just laid off from Supervalu.  I have always shopped at Cub because it’s the most convenient & I supported my company, not because it’s the best.  I was a little surprised when a former co-worker of mine asked if I was going to continue to shop with Cub.  I hadn’t really given it any thought, but I imagine many laid off employees will go elsewhere now that they have no loyalty to the parent company…and no longer have the 10% discount.  Hmmm…maybe I’ll have to take a trip to Rainbow & check things out.

    Another MNB user had some thoughts about Brian Audette, the president of Cub:

    As someone who thankfully left the company before the ship sank, I will say this.  I used to work in a department that reported up to Brian when he was on the Independent side. He was very respected, humble, and had something that was lacking at the Director level and up recently, common sense.  He is one of the few remaining Executives that I would actually trust to make the right decisions there.

    We reported that Mike Duke is getting a 14 percent raise, which led one reader to write:

    Mike Duke gets a 14% raise! I would never deny anyone to make as much as someone is willing to pay you. However, my guess is Walmart is not giving its other hard working employees nearly that type of increase. I'm sure their 2-3% merit increase does not feel so great right about now.

    To follow up on this point, the Huffington Post had a commentary yesterday calculating that "it would take a full-time hourly Walmart employee, who earns $12.67 per hour according to the company's website, more than 785 years to earn Duke's annual salary. That's up by about 100 years from Duke's 2011 pay package of $18.1 million. This calculation is probably on the low side, as it assumes a Walmart employee works 40 hours a week, 52 weeks a year, never takes vacation and doesn't pay taxes."

    'Tis true that people have a right to make whatever they can, but it also is true that just because you can do something does not mean you should do something.

    It is at least fair to say that when it comes to calculating his own worth compared to that of his employees, Mike Duke is no Jim Sinegal.

    Yesterday, we reported that Walmart and the Walmart Foundation announced this week that "over the last fiscal year they gave more than $1 billion in cash and in-kind contributions, making it the first time Walmart or any U.S. retailer has achieved that level of giving. The growth in global giving was largely due to increased in-kind donations in the U.S. to local food banks and families impacted by disasters."

    I commented:

    I was going to make a joke here about how one of the reasons Walmart had this much money to contribute was that so much more was available once the bribery fund was shut down.

    But I decided that would be mean. And the fact is, this kind of altruism is a good thing, and people and companies that make such contributions deserve better than to have some moron like me making fun of them for doing so.

    I'll find another reason to poke a little fun at them. Tomorrow.

    MNB user Rich Goldschmidt responded:

    You are right on two fronts. 1) This level of corporate donation is a ‘first’. 2) You are also right not to make a joke of it – it would be really wrong! (Although, you did it anyway).

    Many Fortune 100 corporations have stubbed their toes. No one has donated as much as Walmart. KC, you need to provide balance in your reporting! I have the picture of Walmart Tractor Trailers lined up to support Katrina victims in New Orleans. They were there before our government responded. To provide reporting value, you need to evaluate holistically.

    I recognize that fairness often is in the eye of the beholder, but I think I do my best to be fair to Walmart. I have a lot of respect for much of what the company does, but that does not mean I cannot ask questions, suggest hypocrisies, and poke a little fun at them.

    Let's be clear about something. In my heart, I am a wisenheimer. I make fun of almost everything.

    Another MNB user wrote:

    Regarding the Wal-Mart article where over 1 billion cash and in kind contributions were provided by the retailer, I cringed and wondered if credit was being given to where it wasn’t due. I want to know how much Wal-Mart gave from its coffers and how much it collected from generous customers. I want to know which retailers are giving back to the communities and which ones are collecting money for the "goodwill credit.". There is a fine distinction between collecting money and donating resources and money. I want to see more transparency so we can give credit to where it is due. If the article read Wal-Mart collected x millions of dollars from customers for charity AND donated x hours/x dollars for charities, it would have been a totally different story. This type of transparent information should be for all companies, I’m not trying to single Wal-Mart out.  

    One a side note, here is another pet peeve…

    I work for a company that is asking employees to track their charitable hours OUTSIDE of work and report it to the company. That way, the company can say “See, our employees donated this much time to charities” which in my mind is the company trying to take credit for something it didn’t help with. It would be a different story if the company was donating our time while on the clock, but to track people’s hours while off the clock just reeks of hypocrisy.

    We had a piece the other day about how some are predicting the end of the cupcake craze. Which prompted MNB user Joye Crosby to object:

    I’ve been in the Bakery business since well...a long time.  Cupcakes aren’t going to go away.  They are going to remain as a staple in a “real bakery”.  You know the place, they make breads, cakes, pastries, donuts, wedding items, and yes cupcakes.  This is a place where there is some choice of what to buy.  We have been here since the beginning and have had to evolve and change like all businesses.  My advice to the Cupcake only stores is to look at likely partners to enhance their offerings.  Maybe a soft yogurt or ice cream shop?  Maybe add other bakery items like cakes?

    If they choose not to do this, then you can always go back to your neighborhood bakery or supermarket with a bakery and probably find cupcakes and other choices you may like even better. Enjoy....

    To be fair, I think the prediction was actually more about a possible/likely end to the cupcake craze as it relates to stores that only sell cupcakes. Stores like yours will always have a place in their communities, I hope. (Some of my fondest childhood memories have to do with Mueller's, a wonderful bakery in Bay Head, on the Jersey shore. Though it had more to do with the crumb cake than the cupcakes.)

    Regarding the promotion being run by Stew Leonard's, in which the retailer offered a $200 gift card to the customer who could write the funniest caption for an actual picture of Jerry Seinfeld leaving the store with a basketful of groceries, one MNB user wrote:

    I agree, great move by Stew’s with the Jerry Seinfeld pick and enjoyed your entry.   Being a fan of the show, I couldn’t resist entering myself and went with...

    “I can’t believe the old lady got the last marble rye!”

    Good one!

    And another reader suggested:

    “Whoops, a Porsche is the wrong car to drive to Stew’s.
    And another:

    I realize you aren’t running your own contest here…and I suspect I won’t be the only one…but couldn’t resist throwing my own caption here too.
    “Marble rye, black and white cookies, chocolate and cinnamon babkas, mulligatawny, jambalaya, Bosco, drake’s coffee cakes, beef-a-reno, Ovaltine, muffin tops and everything I need to make a big salad!  Shopping done.”

    KC's View: