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    Published on: March 27, 2014



    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, reporting this week from downtown Boston … and this is FaceTime with the Content Guy.

    Being in Boston this week has gotten me thinking about a kerfuffle that happened a few weeks ago, when down in Florida, the Boston Red Sox were scheduled to play the Miami Marlins. The Red Sox did not bring enough first string players to the away game, which broke a Major League Baseball rule and irritated the Marlins, who had sold a lot of high-priced tickets to people hoping to see David Ortiz and other members of the World Championship Sox. There was some bickering back and forth, and the Red Sox eventually apologized.

    Now, I have to admit that I'm not crazy about the rule. The primary goal of spring training is to get players ready for the regular season (this year, this may include teaching them run the bases while wearing snow shoes), and I'd be more concerned about Ortiz not hurting his back on a bus ride than making Marlins fans happy.

    So I was sympathetic to the Red Sox until their owner, John Henry, tweeted that he believed that the Marlins ought to apologize for their entire lineup. And I thought that was just unnecessary … sort of lowest common denominator repartee … especially considering that, let's face it, the Marlins stink and the Sox are the defending champs. It just wasn't very classy.

    I think that there's too much of that these days. We'd all be better off, I think, if we focused on the good things that we do and less time being critical of other people's negatives. It'd be better for the national discourse, better for our hearts and even better for our souls. (And I say this, of course, mindful of the fact part of what I do for a living is take shots at people and companies that I deem deserving.)

    By the way, speaking of a coarsening national discourse … I noticed recently while hiking through Runyan Canyon in Los Angeles that it seemed like one out of every t-shirts worn by other hikers featured the f-bomb writ large on either the front or the back. And all I could think was, is this really necessary? Or is it yet another example of what some people think is witty but actually is totally witless?

    I know how I'd vote.

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

    KC's View:

    Published on: March 27, 2014

    by Kevin Coupe

    Yesterday this this space, MNB took note of a Variety story saying that "the number of frequent moviegoers in the all-important 18-24 age group plunged an unprecedented 21% in 2013, according to MPAA annual statistics released Tuesday … while attendance in the 12-17 age bracket also saw a precipitous drop off, falling almost 15%." The story concludes that formerly frequent moviegoers "from 12-24 are likely spending much of their previous moviegoing time watching a variety of other screens."

    I commented that "this is the kind of story to which every business needs to pay attention, since it reflects a broader demographic trend - young people who used to be committed to a certain kind of behavior, on which an entire industry depended, changing that behavior in ways that cannot help but change that industry.

    "In this case, we're talking about the movie business. But there's no reason to think that pretty much any other industry would not be vulnerable to the same kinds of seismic shifts."

    Well, now Time has a story about a report issued by the Motion Picture Association of America saying that "domestic movie box-office sales rose to $10.9 billion last year, from $10.8 billion in 2012, but that the increase was due to higher ticket prices, not increased attendance. In fact, the number of tickets sold slipped 1.5% to 1.34 billion from 1.36 billion in the past year. The average ticket price nationwide was $8.13 last year, up from $7.96 in 2012 (the average includes lower-priced matinee tickets)."

    And the suggestion is that this is untenable … a conclusion with which at least some MNB readers would agree.

    After yesterday's Eye-Opener, I got a number of emails from readers along the same lines…here are some examples…

    • I am 23 will be 24 in April. I can tell you without a doubt this has NOTHING to do with screens and quality of film content. The price to see a movie goes up every time, it is ridiculous.

    • Funny, price is never mentioned. Perhaps theaters are overpriced, especially for a demographic with high unemployment and low earning potential.


    Now, I thought all of this was interesting.

    Living where I live, I pay a lot more to go to the movies than these "average ticket prices." I'll plop down $12.50 (or more if I'm seeking a movie in IMAX or 3-D) to go to the terrific AMC theaters about ten miles away, or $10 to go to the local art house cinema where they show foreign and independent movies.

    This is, however, a lesson in value.

    I rarely think that $12.50 for a movie is too expensive if I like the movie. After all, that works out to about six bucks an hour or less to be entertained. Compare that, for example, to the cost of a Broadway show. Or going out to dinner at a decent restaurant. Or going to a ballgame. By those standards, going to a movie is a bargain.

    I also never buy food and drink from the concessions, which are pricey. I try not to eat candy and popcorn, so it works out both from an economic and nutritional perspective.

    While a lot of theaters aren't doing enough to create a compelling experience that compares positively to all the other options that young audiences have, I continue to believe that the biggest problem with the movie business is the fact that studios spend way too much time producing $250 million extravaganzas without coherent plots or decent acting performances … an approach that can alienate older audiences that actually have an allegiance to the traditional moviegoing experience.

    But as the emails yesterday clearly pointed out, value is a matter of perception.

    That's a lesson with which the movie business obviously is struggling. They're not alone.

    I meet with retailers all the time where, when discussing the battle between bricks-and-mortar businesses and e-commerce entities, say how much they depend on people "who will continue to want to come to the store." But that dependence only will go so far as those stores are able to differentiate themselves and define their value and values in the minds of their shoppers.

    It is an Eye-Opener.
    KC's View:

    Published on: March 27, 2014

    The Associated Press has a story about US Labor Department survey showing that "young adults born in the early 1980s held an average of just over six jobs each from ages 18 through 26 … 6.0 jobs for men and 6.3 for women."

    According to the story, "The number of jobs held varied by educational levels more for women than for men. For men it ranged from 5.9 jobs for those with less than a high-school diploma to 6.0 jobs for those with a college bachelor’s degree or higher. For women, those with less than a high-school diploma held 4.9 jobs over the period while women with a bachelor’s degree or higher held 6.9 jobs.

    "The study included the period of the recession that ended in 2009. During that period, jobs across all age groups were lost and overall unemployment soared to 10 percent. It was 6.7 percent in February."
    KC's View:
    here are two things going on here, it seems to me.

    No question that in a tough economy, people with less education are going to have a difficult time obtaining and holding onto jobs.

    But there's also the clear indication that people in general are willing to change jobs and feel little or no loyalty to employers … there is a great sense of mobility and flexibility, with a desire to seek greater challenges and/or compensations. That's a challenge to employers - to attract and then keep employees who will then define and sustain those businesses.

    Published on: March 27, 2014

    The New York Times has an interesting story about how economics have turned Manhattan into unfriendly turf for both independent and chain bookstores, a shift that reflects a broader cultural change that may not be entirely positive.

    "Rising rents in Manhattan have forced out many retailers, from pizza joints to flower shops," the Times writes. "But the rapidly escalating cost of doing business there is also driving out bookstores, threatening the city’s sense of self as the center of the literary universe, the home of the publishing industry and a place that lures and nurtures authors and avid readers."

    For example, the Times writes, "The Rizzoli Bookstore was recently told that it would be forced to leave its grand space on 57th Street because the owners decided that the building would be demolished … The Bank Street Bookstore in Morningside Heights announced in December that it would not renew its lease when it expires in February 2015, saying that it had lost money for the last decade. Both stores are scrambling to find new locations … Independents like Coliseum Books, Shakespeare and Company on the Upper West Side, Endicott Booksellers and Murder Ink have all closed their doors."

    It isn't just the little guys: "Since 2007, five Barnes & Noble stores throughout Manhattan have closed, including its former flagship store on Fifth Avenue and 18th Street, which was shuttered in January. Five Borders stores in Manhattan were closed in 2011 when the chain went bankrupt, vacating huge spaces on Park Avenue, near Penn Station and in the Shops at Columbus Circle.

    "State data reveals that from 2000 to 2012, the number of bookstores in Manhattan fell almost 30 percent, to 106 stores from 150. Jobs, naturally, have suffered as well: Annual employment in bookstores has decreased 46 percent during that period, according to the state’s Department of Labor."
    KC's View:
    This shouldn't be an enormous surprise to anyone. After all, Nora Ephron focused on the trend back in 1998 when she wrote and directed You've Got Mail. I'm not sanguine about these changes … I'm not sure how public policy can keep untenable businesses alive, and I'm certainly not happy when neighborhoods of New York start to resemble Florida strip malls.

    Published on: March 27, 2014

    VentureBeat reports that Instacart, the personal grocery shopping service, has come to New York, expanding yet again after having begun serving markets such as San Francisco, Boston, Chicago, Washington, DC, and Philadelphia.

    For the time being in New York, Instacart seems to just be serving downtown Manhattan and is sending its personal shoppers only to Whole Foods, though the company says that it plans to add to its New York geography and store availability in coming weeks.
    KC's View:
    Instacart remains a service that adds cost to purchases. The question is whether it adds enough value to purchases to make the business sustainable.

    Published on: March 27, 2014

    GeekWire has a story about a new startup, Gatheredtable, which is designed so that it "automatically generates a menu of weekly meals, tailored for your families’ preferences … The service will cost $10 to $12.50 per month, allowing families to clip online recipes and set preferences. From there, families get a weekly individualized menu with certain meals slated for specific days of the week. Customers indicate how many days per week they’d prefer to cook, and how much time they can commit, and then the Gatheredtable algorithm gets to work spitting out recipes based on food preferences."

    In addition, the story says, "For a one-time fee of $125, families also can have a Gatheredtable 'concierge' come to their home to inventory food in the pantry and help enter recipes into the online system. Concierges will log everything from oils to spices, helping to make it easier for busy families to figure out what’s best to cook each week."

    The startup currently is in beta testing in just six cities, with a rollout scheduled for later this year. It has raised $1.8 million to fund the startup - with Starbucks CEO Howard Schultz among the investors.

    "Gatheredtable certainly faces plenty of competition, with no shortage of online recipe and family scheduling applications," the story notes. "Just in Seattle alone, there are services such as AllRecipes.com, BigOven and Cozi to help families better plan meals."
    KC's View:

    Published on: March 27, 2014

    CityWire reports that Walmart has filed suit against Visa, "claiming the defendant conspired with large banks to fix interchange fees charged to merchants between Jan 1, 2004 and Nov. 27, 2012 … The suit claims that Visa raised interchange fees by 234% between 1998 to 2006. The complaint also alleges Visa’s anticompetitive conduct generated more than $350 billion in interchange fees for the colluding issuers during the damages period — fees that Wal-Mart and other retailers paid and continue to pay."

    The story notes that Walmart was among the retailers that rejected a $7.25 billion settlement that was reached between some retailers and both Visa and MasterCard, saying that it did nothing to reduce fees and make them transparent. Visa subsequently sued Walmart, seeking "to block Wal-Mart from pursuing more damages with an injunction," the story says.

    “Wal-Mart and all other merchants were subjected to rules and practices that harmed competition, suppressed fraud preventing technology in the U.S., and inflated interchange fees charged to merchants when customers used their credit and debit cards. As a result, many merchants were forced to pass on some of these artificially high fees to consumers,” says Walmart corporate spokesman Randy Hargrove.
    KC's View:

    Published on: March 27, 2014

    Consumer Reports is out with its annual rankings of the nation's supermarkets, based on how its readers gauge their service levels, prices, cleanliness and perishables quality.

    Wegmans tops the list, followed by Trader Joe's, Publix, Costco, Sprouts Farmers Market, Market Basket, Raley's, Fareway, Stater Bros. and Winco.

    At the bottom of the list: Walmart.

    You can read the entire list by cutting and pasting the following URL into your browser (the hot link does not seem to work, for reasons that escape me):

    http://www.consumerreports.org/cro/money/shopping/supermarkets/supermarkets-ratings/ratings-overview.htm
    KC's View:
    I've always been a little skeptical about this list, because so many of the companies on it are regional in nature. Most people in the east for example, have no idea what a WinCo is, just as people in the west aren't familiar with Wegmans. I'm sure that all the rankings are weighted to account for regional differences, but I think rating supermarkets is a lot harder than rating cars, airlines or refrigerators.

    Published on: March 27, 2014

    NY1 reports that the New York City Council will consider a new bill that would mandate the charging of a 10 cent fee for every single use paper or plastic bag used in the city.

    According to the story, New Yorkers use more than five billion bags a year, and "it costs the city about $10 million each year to transport 100,000 tons of bags to landfills."

    The story notes that a similar bill failed to get through the City Council last year, but there seems to be more support for it in 2014.
    KC's View:

    Published on: March 27, 2014

    • Rite Aid Corp. announced that it has hired Dedra N. Castle, formerly the vice president and Chief Inclusion & Diversity Officer at Walmart-owned Sam's Club, to be its new Executive Vice President and Chief Human Resources Officer.


    • The Business Journal reports that Brett Berry, former president/CEO of The Fresh Market, has announced his retirement as vice chairman of the board. Before becoming president/CEO of the company, he served there in roles that included COO, executive vice president of operations and vice president of marketing.
    KC's View:

    Published on: March 27, 2014

    …will return.
    KC's View: