business news in context, analysis with attitude

Published on: May 2, 2014

by Kevin Coupe

A new Wall Street Journal/NBC News poll offers some reassurance to folks who may worry that social media and online networking are replacing face-to-face social experiences.

According to the Journal, "More than two-thirds of Americans have a social media profile and shop online, and more than 60% pay bills online, the survey found. But people are still nearly as likely to have frequent family dinners as they were 15 years ago."

Some specifics from the poll report:

• "68% said they had a personal profile on social media sites such as Facebook, LinkedIn, Pinterest or Twitter. That is up from 51% in January 2011 - and up from 21% as recently as April, 2008, when the Pew Research Center asked a similar question."

• "58% said they had a family dinner at least five times a week - about the same as the 60% who said so in June, 1999 …. 69% of Americans said they knew their neighbors well, compared with 73% who said so in 1999 … Among adults between 18 and 49 years old, 68% of people with a social media profile said they knew their neighbors well, compared with 57% of people without a social media profile."

• "Social-media activity remains heavily skewed by generation in the current poll: 90% of people age 18 to 34 had a social media profile compared with 37% of people over 65."

In other words, folks who worry that all this social networking was going to lead to the end of western civilization as we know it can relax a little bit. Texting with neighbors or communicating with them via social media doesn't mean you won't talk to them while hanging out in the driveway.

It's an Eye-Opener.

Published on: May 2, 2014

The San Antonio Business Journal reports that H-E-B plans to launch an e-commerce service laster this year, which the story says "would seem to put it in competition with delivery services such as Amazon.com’s Prime Pantry and Google Shopping Express, which couriers products from Target and Costco."

Bob McCullough, H-E-B's senior vice president of manufacturing, tells the paper that "it will be a world-class offering you’ll be very excited about," though he declined to offer any further details.

The Journal also reports that H-E-B plans to open three new manufacturing plants over the next few years, including a milk processing plant in Mexico and a snack production plant in the US.

Published on: May 2, 2014

The Washington Post reports that Amazon has expanded the number of cities where it is offering same-day delivery, adding Dallas, Los Angeles and San Francisco to the list, which also includes Baltimore, Boston, Chicago, Indianapolis, New York, Philadelphia, Phoenix, Seattle and Washington, DC.

This brings the total list to 12; Las Vegas, which used to have the service, inexplicably has been dropped from the list.

The times by which customers have to order to get same-day delivery varies by city. In Baltimore, Boston and Washington, for example, 11 am is the deadline. Chicago has a 7 am deadline, and New York City has an 8 am cutoff. Los Angeles, Phoenix, San Francisco and Seattle all have 12:15 pm cutoffs.

In all cases, the products are promised to be delivered by 9 pm.

Published on: May 2, 2014

The Cincinnati Business Journal reports on comments made by Kroger CEO Rodney McMullen on a recent Network of Executive Women Cincinnati chapter’s executive officer panel, in which he described the integration of Harris Teeter into Kroger's infrastructure.

According to the story, "Kroger is integrating Harris Teeter’s 227 stores with its own roster of 2,600 locations. Kroger employees have already taken Harris Teeter’s ideas about how to prepare each store for the upcoming week with ads and promotions and spread those across the chain, McMullen said. It doesn’t matter to him or the rest of Kroger’s associates where the ideas come from."

In addition, McMullen said, “The biggest surprise is probably the opportunity for Harris Teeter to grow the business where they are." Harris Teeter is well positioned to "add stores in its current markets, such as Charleston, S.C., and build market share."

Published on: May 2, 2014

Balance Innovations is out with a study suggesting that 42 percent of college students would "probably not" or "definitely not" make more payments using mobile technology, even if that technology were more widely available. And, the survey said, "another 42 percent reported they would use their mobile phone 'somewhat more, depending on the retailer or purchase.' 16 percent of those surveyed said they absolutely would use mobile payments 'all the time'."

Other notes from the study:

• "Students in career-oriented majors, such as accounting or business administration, are more likely to embrace mobile payments than those in academically oriented tracks, such as history or English."

• "At 18 percent, students in graduate programs are the most likely college students to say they would use their smartphones for in-store payments all the time, if available."

• "Students living on either coast are more likely to gravitate toward mobile payments at 18 percent (West Coast) and 17 percent (East Coast). Only 13 percent of students in colleges located in the Midwest said they would use their mobile phone to pay for purchases."

Published on: May 2, 2014

Forbes.com has a piece that looks at how Whole Foods "is looking for its next wave of growth by opening up over 1,000 'smaller and urban' stores in markets it would have never considered 10 years ago."

The piece suggests that this shift reflects several of Whole Foods' priorities, including the defining of a narrative that Whole Foods aspires to communicate to employees, investors, customers and communities, as well as the leveraging of the brand's equity to "succeed in new segments and geographies that don’t fit the typical template."

Not always easy, of course, because essentially Whole Foods is trying to stay true to its core mission and values while moving outside its sweet spot.

You can read the entire piece here.

Published on: May 2, 2014

...with brief, occasional, italicized and sometimes gratuitous commentary...

• The Wall Street Journal reports this morning that J. Crew "is developing a new store format aimed at budget-conscious shoppers." Called J. Crew Mercantile, the store "will feature merchandise and prices closer to what shoppers would find at J. Crew Factory, the retailer's outlet stores, than what is available in its full-line stores," the story says, adding that the new format is designed to "help the company broaden its reach to discount-seeking shoppers while in theory not hurting the pricing power of its mainline brand."

Mickey Drexler, the J. Crew CEO, did much the same thing when he was at Gap and he launched the Old Navy brand. He's one of the smartest retailers out there, and so it'll be very interesting to see what he comes up with in designing this new brand.


• CNN reports that the Department of Labor's Wage and Hour Division has determined that Subway franchisees were found to have violated wage and hour rules more than 1,100 times between 2000 and 2013, earning the dubious distinction of being the fast food brand with the most infractions.

McDonald's and Dunkin' Donuts came in second and third, respectively.

They'll just have to try harder, I guess.

Published on: May 2, 2014

• Reuters reports that UK supermarket chain J Sainsbury made a series of management moves as Justin King prepares to step down from the CEO role, to be replaced by Mike Coupe.

According to the story, "It said on Wednesday that … Roger Burnley, currently managing director of general merchandise, clothing and logistics, would become retail and operations director leading a newly combined team overseeing supermarkets, convenience stores and logistics. Helen Buck, currently retail director, will oversee business development to focus on areas beyond the core operations."

Published on: May 2, 2014

Regarding Amazon's enduring relationships with shoppers, one MNB user wrote:

It IS about the enduring relationship with Amazon and most retailers don’t see how this is working because they are dealing face to face with their customers and argue that this creates a more personal relationship.

I learned a lesson about this enduring relationship from my son while he was attending boarding school.  I noticed he ordered a lot from Amazon, which was fine—he’s always been a reader, but what he told me (after he was already in college) was that he and all of his friends ordered their condoms from Amazon - they didn’t suffer the embarrassment of the face to face meeting in the local pharmacy and they could get exactly what they wanted from Amazon.  I asked if they ordered anything else in addition to books and condoms.  “Sure, it’s a lot easier to order what you need and Amazon is always adding new things.”

He’s 26 now and remains a dedicated Amazon customer.  Our kids get it.  And the world changes a bit more each year for bricks and mortar retailers.




Got the following email from MNB reader Cater Calico:

I wanted to pass along my most recent experience with targeted marketing. I’m an AT&T customer and my home town is Conway, Arkansas … meaning the cell number I have still traces back to that city. The recent storms did severe damage to the central Arkansas area, namely the cities of Vilonia and Mayflower, both just outside of Conway.

Today I received a text message from AT&T stating that their ‘thoughts were with us and our friends and neighbors during this difficult time’ and any overages incurred during the May billing cycle would be credited back to the account. Now, I can’t remember the last time I got anywhere near my minutes limit, but I think the idea of reaching out is a good one. Personally, I know many families that were impacted by the storm and to see a major company respond in that way got my attention. I don’t plan to take advantage of the overage waiver time, but the fact that I’m writing an email to tell others about it should say something.

Well done AT&T.

Not words you hear a lot … but I'm glad we're giving credit where credit is due.

Published on: May 2, 2014

Draft Day is the new Kevin Costner sports movie, which is all by itself a pretty good pedigree, considering that the star already has Bull Durham, Field of Dreams and Tin Cup under his belt. (He also has For Love Of The Game, which doesn't measure up to the other three, though he is entirely credible in it.) Draft Day is directed by Ivan Reitman, who also has a pretty good track record. (Heard of Ghostbusters and Groundhog Day?) And, it has a terrific supporting cast, featuring Jennifer Garner, Ellen Burstyn, Frank Langella, Denis Leary, Sam Elliot, Tom Welling, and the extraordinary Chadwick Boseman … so one can walk into the theater with a certain amount of confidence.

The events of Draft Day take place in the hours leading up to the NFL draft, as Sonny Weaver Jr. (Costner), general manager of the Cleveland Browns, has to decide who to take in the first round as he negotiates with other general managers, the Browns owner (Langella), his mother, an uncooperative new coach (Leary), and a girlfriend/cap expert (Garner) who has just revealed that she is pregnant. In other words, he has a full plate … including grappling with the shadow of his late father, the former coach of the Browns.

Here's the thing about Draft Day - it is perfect for someone like me, who likes football, but is not obsessed with it … and who knows very little about how the draft works. It was enjoyable though a lot less credible for someone like my son Brian, who knows a lot more about this stuff, and knew what could happen and, more importantly, what couldn't.

With that caveat, I have to say that I really enjoyed Draft Day, though to be honest, Costner's character in some ways is the perfect picture of how not to run a business - for too much of the movie, he seems buffeted by events and personalities, and one of the reasons many people seem willing and able to give him a hard time is because he doesn't present the image of someone in control. That said, Costner - as always - makes the movie work … he hasn't always made great choices as an actor, but he is always interesting, always invested and engaged in the material, and utterly watchable.

One other note. Watch Chadwick Boseman, who plays a defensive back, Vontae Mack, who is one of the players being considered by Costner as a potential first round pick. Boseman, who was wonderful as Jackie Robinson in 42, plays an entirely different kind of athlete here, but he fills what essentially is a small role with layers of unexpected complexity … he owns every scene he is in. He is a major star in the making … and I think he'll explode onscreen when he plays singer James Brown in Get On Up, a biopic due to be released in August.




Spent some time in Orlando last week, which is why I found myself at Cask & Larder, in Winter Park,which is quickly moving into Bin 36 and Etta's "home away from home" territory. It always helps when I get to know the bartender (Larry, always great) and the managers (Kelly and Trilce) … I like feeling like a regular, even if I only show up a couple of times a year to enjoy the catfish sandwich, the crab toast (served with smoked artichokes, heirloom tomatoes, and pretzel bread) and the lobster corn dogs.

In this case, I also got a chance to meet the brewmaster. My friend Bob Morris (a terrific mystery novelist, travel writer and publisher) introduced me to Ron Raike, who has just developed a new Mezcal Margarita Ale, which was an unlikely but utterly delicious combination of beer and margarita … and I can only imagine how addicted I'd be to this ale if I spent much time in Florida during the hot summer months. It is an awesome beer that is the equal of all of Ron's other beers … and I recommend the entire experience to you.

Great stuff. Go when you can. Thank me later.




That's it for this week. Have a great weekend, and I'll see you Monday.

Slàinte!