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 4, 2014

    by Michael Sansolo

    Life is full of small details that we don’t often think about. Little things like the competence of the mechanic who worked on an airplane part that is so critical to your flight.

    Or the attention span of the driver next to you on the interstate or the ability of a football player to snap a football to his quarterback when and where he actually is looking for it. Small things always matter.

    Sgt. Virginia Musall takes care of one of those small details for the US Army. Her story, written up for some reason in the New York Times business section this weekend, gives a lesson to us all in the power of small details and how to reinforce their importance in the work place. It’s a lesson for anyone and everyone.

    Sgt. Musall is a parachute rigger: she makes certain that parachutes are packed correctly. It’s her job to ensure that when some soldier jumps out of a plane and down into everything from an exercise to a battlefield, the chute opens exactly as it should.

    Sgt. Musall checks on four other riggers, making certain they packed the 36-pound parachutes correctly. There are 12 safety checks in the job because, let’s face it, a mistake at her workplace cannot possibly end well. There is no room for error for her crew.

    Here’s where the army provides a lesson that businesses might want to steal in a heartbeat.

    Four times each year, Sgt. Musall and all her fellow riggers are required to make a jump. That is, four times a year, they have to put themselves in the place of their main “customers.” They strap on a chute, jump out of an airplane, and expect everything to work perfectly.

    Now granted, no job any of us have really compares. As Musall said, things can happen on any jump, including one she made that landed her 50 feet up in a tree. (Other soldiers quickly came to her aid.)

    But think about the powerful reminder those four required jumps give the riggers. Four times a year they literally stand in the shoes of their “customers” and understand the trust the jumper has to have in the rigger. The jumper can’t check on every detail of the rigging; they simply have to have faith the job has been done correctly.

    I imagine that the four annual jumps help reinforce that trust in countless ways.

    No matter what your company does, it has riggers - or something similar. You have people in jobs whose work can be a cause of life and death—or certainly illness or failure—somewhere down the line. They probably never meet the people who depend on their work. And while failure might not be as dramatic as anything a parachute rigger faces, it could be extremely important.

    So think for a second of the lesson provided by those four annual jumps made by Sgt. Musall and consider how you could do the same. It could be as simple as requiring food service employees to eat regular meals from the products they produce.

    It could include requiring technology people to take over a checkout lane and see if the scanners are functioning as smoothly as they should. It could impact anyone, from a store designer to someone in supply chain management to pretty much anyone to stand in the shoes of the end user.

    It might not be as dramatic as jumping out of an airplane, but it’s hard to imagine the lesson would ever feel more real.

    Or make their job feel more important.

    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:

    Published on: February 4, 2014

    by Kevin Coupe

    Go figure.

    You'd think that a Super Bowl commercial featuring a patriotic song and lots of people of all shapes, sizes, ages, colors and genders bonding over a soft drink would be enough to get people to get all gauzy and sentimental. Or at least thirsty.

    But not always. (Unless, of course, you count thirsty for blood.)

    For some reason, a Coca-Cola commercial that featured a rendition of "America the Beautiful" sung in seven different languages irritated a lot of people, who thought that it was Coke's way of promoting dreaded multiculturalism, not to mention legitimizing illegal aliens at a time when immigration reform is a hot-button political issue in the US.

    Which was weird, because - I swear - when I saw the commercial, the first thing I thought of was that it was enormously aspirational … that even people who don't speak English and who are outside what some folks would think of as the mainstream believe in the beauty of America's vision and ideals. I never felt for a moment like it was anything other than that.

    But as I read about the controversy, I discovered that it wasn't just the seven languages that upset people. For some, it was the fact that in one of the clips used in the commercial, there was a gay couple.

    Which was weird because when I saw the commercial, I didn't even notice the gay couple. Since then, I've gone back to watch it online, and yep, they're there. But I swear I didn't even notice them until some folks got in high dudgeon about it.

    I didn't know this until I saw "The Colbert Report" last night, but apparently the writer of "America the Beautiful," Katherine Lee Bates, lived with another woman, Katharine Coman, for two decades. (Some say it was a lesbian relationship, and others say it was a "Boston marriage," which was a term used for two women living together and not being dependent on men.) Regardless, it seems likely that the writer of "America the Beautiful" might've been tolerant of a gay couple appearing in a Coke TV commercial. (That is, if she even knew what Coke was, since she was born in 1859, Coke wasn't invented until 1886, and she died in 1929. It is, however, a good bet that she had no idea what a "TV commercial" was. Or what a Super Bowl was, for that matter.)

    I have no idea if today, a couple of days after the Super Bowl, Coke regrets its advertising decision. I hope not. It seems to me that it was advertising to a multicultural audience that speaks a variety of languages, includes gay people - all of whom it hopes will drink a Coke product.

    In the end, that's the bottom line. Marketing to the world the way it is, as opposed to the way some people would like it to be.

    Still, it is an Eye-Opener.
    KC's View:

    Published on: February 4, 2014

    Reuters reports that Target CFO John Mulligan, in an op-ed written for The Hill newspaper before his appearance before the US Senate Judiciary Committee, said that the company is speeding up the development of chip-enabled credit and debit cards that will provide greater security against cyber theft such as the data breaches that affected tens of millions of its customers.

    Mulligan said that the goal is to have the technology in about a year. Chip-enabled cards, the story says "contain tiny microprocessor chips that encrypt personal data shared with sales terminals used by merchants. Stolen smart card numbers would be useless without the chip."

    Noting that such cards are used elsewhere in the world, Mulligan wrote that the chip-enabled cards would be "one step American businesses could now take that would dramatically improve the security of all credit and debit cards."

    He went on: "The data breach that struck our company spotlighted the sophistication of criminal hacker networks operating across the globe. We know the attack created significant concerns for millions of customers. We will learn from this incident and we will work to make Target, and the wider business community, more secure in the future."
    KC's View:
    Better late than never, I suppose. Though perhaps the people affected by the data breach would disagree with that assessment.

    We've all seen the stories about how this technology has been available for awhile, but was not implemented in the US because of concerns about cost. It strikes me that in the future, business needs to work on the premise that the bad guys are always going to be working hard to be a step or two or three ahead of where technology is. Good enough probably isn't good enough, secure enough probably isn't secure enough, and the status quo is almost certainly going to put you in a defensive position. Start with that as your premise, and you take a different approach when it comes to things like smart cards.

    Published on: February 4, 2014

    The New York Times reports that "a poll released last week by The Associated Press and GfK Public Affairs & Corporate Communications found that 37 percent of Americans had made an effort to use cash instead of credit or debit cards to pay for purchases as a result of the recent data thefts - almost as many as those who checked personal credit reports because of the thefts. (Just 29 percent said they had changed passwords or requested new cards.)"

    Spokespeople for Visa, MasterCard and American Express won't or can't confirm that any sort of discernible shift is taking place, and, as the story notes, there are drawbacks to trying to live an all-cash existence - such as not being able to shop online. And, the population is almost programmed to just swipe their cards rather than count out bills and change; virtually every retail environment takes cards, and in some places - like airplanes, for example, when selling drinks and meals - they only take cards.
    KC's View:
    I'm a little dubious about the idea that cash will make a comeback, unless retailers start doing things like offering discounts to cash customers. There may be some ripples in the cash/credit/debit continuum, but I don't think it'll amount to much. Unless, of course, there is some sort of enormous, all-encompassing data breach that speaks to bigger security issues. In which case, all bets are off.

    Published on: February 4, 2014

    In the UK, the Telegraph reports that "Twitter is planning to allow its 232 million users to buy products directly from the site, as part of a new online retail venture called Twitter Commerce … the transactional service is a partnership with a US e-commerce site called Fancy, which counts Twitter founder Jack Dorsey as an investor and board member."

    The story notes that "Twitter’s push into e-commerce … builds on last year’s 'pay by tweet' experiments in partnership with American Express."

    At the same time, Bloomberg reports that Twitter Inc. has hired Nathan Hubbard, formerly the president of Ticketmaster, as the company's head of commerce, a new position. The goal of the hiring, the story says, is to enable Twitter "to enable shopping via short postings on its social website … Hubbard said he will look to team up with merchants and providers of payment services rather than compete with those companies, and may take a percentage of any transactions on its site."
    KC's View:
    In just the past few weeks, we've had stories about how companies like Google and eBay are ramping up their retailing operations, and how Amazon is looking to develop systems that will help bricks-and-mortar retailers process payments. So it should not come as any surprise that any internet or social media site is looking to get into the business of selling, since such efforts - when successful - will both generate revenue and even increase their market price.

    Published on: February 4, 2014

    There is an excellent piece in the New York Times about the vanishing middle class. Here's the premise, as explained by the Times:

    "As politicians and pundits in Washington continue to spar over whether economic inequality is in fact deepening, in corporate America there really is no debate at all. The post-recession reality is that the customer base for businesses that appeal to the middle class is shrinking as the top tier pulls even further away … If there is any doubt, the speed at which companies are adapting to the new consumer landscape serves as very convincing evidence. Within top consulting firms and among Wall Street analysts, the shift is being described with a frankness more often associated with left-wing academics than business experts."

    And some statistics worth noting:

    "In 2012, the top 5 percent of earners were responsible for 38 percent of domestic consumption, up from 28 percent in 1995, the researchers found. Even more striking, the current recovery has been driven almost entirely by the upper crust … Since 2009, the year the recession ended, inflation-adjusted spending by this top echelon has risen 17 percent, compared with just 1 percent among the bottom 95 percent."

    It is a sobering piece, and worth reading here.
    KC's View:

    Published on: February 4, 2014

    The Associated Press reports that the new farm bill passed by the US Congress, requiring that "labels for steaks, ribs and other cuts of meat include clear information about where the animals were born, raised and slaughtered," is creating concern that it could create a trade war with both Canada and Mexico.

    The story explains that "country of original labeling supporters, including consumer groups, environmental groups and some independent farmers, say the requirements give consumers valuable information. But livestock groups and meatpackers say it's costly to have to segregate and track animals along the entire supply chain," which creates problems especially for states along the nation's northern and southern borders.
    KC's View:
    People and organizations have to stop thinking of labeling as a threat or as condemnation, but simply as information. Sure, it will take some adjustments in certain cases … but in the long run, more and better information, including country of origin labeling, is going to be good for consumers, which means it will be good for business.

    Published on: February 4, 2014

    Bloomberg reports that a new study from the US Centers for Disease Control and Prevention (CDC) suggests that "high sugar consumption may double the chance of dying from heart disease, according to a study that adds to evidence that high levels of the sweetener in processed foods and drink is bad for a person’s health."

    The story goes on to say that "people whose sugar intake is about a quarter or more of their total daily calories had twice the risk of dying from heart disease than those who whose intake was 7 percent … For those whose intake of added sugar was about 19 percent, their risk of dying from heart disease was about 38 percent higher."

    According to the story, this is the first major study to link sugar consumption to heart disease. Past research has linked sugar to diabetes, weight gain and obesity. "About 37 percent of added sugar in U.S. diets comes from sugar-sweetened beverages, while the rest comes from grain-based desserts, fruit drinks, dairy desserts and candy, the authors said. Sugar from fresh fruits and vegetables isn’t considered added sugar."
    KC's View:

    Published on: February 4, 2014

    • The Associated Press reports that Trader Joe's has decided not to open a store in northeast Portland, Oregon, an historically African-American neighborhood, after activists complained that "the development would price black residents out of the area … The Portland Development Commission had offered a steep discount to the grocer on a parcel of nearly two acres that was appraised at up to $2.9 million: a purchase price of slightly more than $500,000."

    According to the story, "Critics said the development would displace residents and perpetuate income inequality in one of the most rapidly gentrifying ZIP codes in the nation."

    Trader Joe's released a statement saying, essentially, that if a community doesn't want it, then it won't build a store there.


    Businessweek reports that Walgreen has filed a lawsuit accusing Rite Aid, CVS and ShopKo of "misappropriating its technology for refilling prescriptions with mobile-phone scanners."

    According to the story, Walgreen "got a patent last month for a system to 'express refill' prescriptions and is entitled to exclusive use of the invention, the Deerfield, Illinois-based company said in complaints filed Jan. 31 in federal court in Wilmington, Delaware."


    • The Milwaukee Business Journal reports that Roundy's plans to sell an additional 8.8 million shares of stock that will be used for "general corporate purposes," including the acquisition of 11 former Dominick's stores in the Chicago area that are being converted to its Mariano's format.

    According to the story, "The stock closed Friday at $8.48 per share, just two cents off from the initial public offering. If the sale were to happen at that price, Roundy’s estimates it would receive $23.1 million in net proceeds after expenses.
    KC's View:

    Published on: February 4, 2014

    • The Boston Globe reports that Staples has named Joe Doody, president of its North American commercial unit, to be the company's vice chairman, "with a mandate to lead Staples’ strategic reinvention.”

    The reinvention is keyed to the recognition that the modern consumer needs fewer pens, paper and, well, staples, but instead might need a different level of digital services. Plus, competition from the likes of Amazon and Walmart has driven Staples to re-engineer itself.


    • The Second Cup, a Canadian coffee shop chain with more than 350 units, has hired Alix Box, onetime vice-president of operations for Starbucks in Canada, to be its new president/CEO. Most recently, she was senior vice-president for retail at Holt Renfrew, a luxury retailer.
    KC's View:

    Published on: February 4, 2014

    …will return.
    KC's View: