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    Published on: September 12, 2014

    by Kevin Coupe

    Forget about HDTV. That's so early 21st century.

    Home Media Magazine has a story suggesting that "widespread consumer adoption of 4K Ultra-HD Television will be a reality within 10 years … 80 marketing media executives in an Intelsat S.A. survey said the HD successor to Blu-ray could provide the competitive differentiation necessary to attract new subscribers to linear broadcast and cable television channels.

    "In fact, 42% of respondents said their companies have made a firm decision to launch a 4K UHD service, and have a specific timeframe for its roll out (23% within the next four years)."

    That's not to say that there won't be challenges. Ultra-HD televisions have to be sold at affordable prices. Companies have to begin providing Ultra-HD content. And companies have to provide the set-top boxes and bandwidth to make it possible to transmit Ultra-HD signals.

    But it is extraordinary how quickly traditional HD television is becoming yesterday's innovation, and how quickly technology evolves.

    I would have two tangential observations about this.

    One is that the development of Ultra-HD will only put more pressure on the movie theater business to provide a better customer experience, because the act of watching content at home will only be more pleasant. The movies also are going to have to be better and more suited to the big screen (which may mean, unfortunately, that we're only going to see more movies with explosions and fewer movies with real people).

    The other is that we're going to know that Ultra-HD has gained real traction and has reached critical mass when the porn industry starts advertising its content as being in Ultra-HD. Because when it comes to technology, the folks in the porn business almost always are on the cutting edge.

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

    Published on: September 12, 2014

    The Cincinnati Business Courier has a piece about Kroger CEO Rodney McMullen, who told analysts after his company reported second quarter growth of 17 percent that e-commerce is the company's next big challenge.

    “I would say we feel very good, but we’re not satisfied, and with the changes that we’ve made over the last couple of years we feel increasingly happy about what we’re seeing,” McMullen told analysts on a conference call. “As you know, it’s one of the things when we merged with Harris Teeter that we were really excited about. They have an incredibly strong click-and-collect operation that we’re spending a lot of time on. And as you know, when we announced merging Vitacost, they have a great group of people from a talent perspective and a great infrastructure that we think we can grow off and expand. So I feel very comfortable with where we are positioned from a food standpoint relative to our competition. I feel even more excited about some of the things that we’ve put in place to take advantage of the future.”
    KC's View:
    I suspect that while McMullen may say that he feels "comfortable," the one thing he doesn't want the folks in his company to feel is any sort of comfort or complacency. Kroger has a lot of data about its shoppers, and I think that they're looking into ways to use that data to serve its existing customers better and blunt any inroads that might be made by Amazon, Walmart or any of its other online competitors.

    I've always felt that the folks with the most usable data, and the willingness to actually use it, wins. That puts Kroger in a very good position.

    Published on: September 12, 2014

    The Boston Globe has an interview with Arthur T. Demoulas, the once and future CEO of Market Basket there, who now has the responsibility of leading the retailer in the wake of employee slowdowns and customer boycotts that roiled the chain for six weeks in late summer.

    The controversies that engulfed Market Basket took place after Arthur T. Demoulas was fired as CEO by a board that was controlled by his cousin, Arthur S. Demoulas. The firing was a culmination of a family feud that went back years, but in the short term, it seemed to be about the board being upset by Arthur T. Demoulas's approach to investment and employee renumeration; it was charged that Arthur S. Demoulas and the board were more interested in taking money out of the company than investing in it. The situation was resolved when Arthur T Demoulas acquired the 50.5 percent of the chain that his side of the family did not own for $1.3 billion.

    In the interview, Demoulas says that “Sales are already at 100 percent of where they were last year,” that "bakery, produce, and meat are mostly in. Everyone just got to it and worked as hard as they could.”

    The Globe reports:

    "Even as the business turned a corner, Demoulas said his work was only beginning. Over the next few months, he must stabilize the company’s finances and complete a $1.6 billion purchase of shares owned by family members who have fought with him over Market Basket for 25 years. Then he must figure a way to manage the roughly $1.3 billion in debt that will be created by the transaction.

    "Demoulas acknowledged the new debt might slow expansion of the 71-store chain in coming years. But he insisted it will not change the discount pricing that has won the loyalty of customers across the region. 'Every retailer has to stand for something,' Demoulas said. 'We’re very much grounded in the basic philosophy of driving the ‘more for your dollar’ business model. That’s really something we live by every day'."

    And, the Globe goes on:

    "In the wake of his agreement to buy Market Basket, many specialists have questioned whether the company will be able to maintain an employee profit sharing plan that costs tens of millions of dollars a year.

    "But Demoulas described his commitment to the plan as 'unwavering.' He recounted a recent retirement party at which all four departing employees left the company with large nest eggs. Two store directors had more than $1 million; a produce supervisor had $800,000; and a truck driver was leaving with more than $700,000.

    “'We don’t anticipate that any of that will change,' he said. 'We’re committed to the profit sharing plan that’s been in place now since 1963'."
    KC's View:
    It seems pretty clear that if the company's new debt load requires Demoulas to make a choice between opening a new store and keeping the profit sharing program, he's going to keep the profit sharing program. If he doesn't, he's going to sacrifice all the good will he's generated in recent months.

    Published on: September 12, 2014

    Whole Foods announced this week that it is teaming with to create a new, national initiative, Wine Club by Whole Foods Market, that will launch October 1.

    The goal, the company said, will be "to bring extraordinary, one-of-a-kind wines from around the world directly to wine lovers’ homes" and will "offer Wine Club members four shipments of six bottles each a year at the price of $125 per shipment, including shipping costs … The exquisite wines, which epitomize variety and regional nuance, are hand-selected by Whole Foods Market’s wine experts, Doug Bell, global beverage buyer, and Devon Broglie, associate global beverage buyer and Master Sommelier, who have over 50 years of experience between them in the wine industry."

    Bell says that one of the goals of the program is "turning on potential new shoppers or enthusiasts who might not live near a Whole Foods Market to some delicious wines" - which translates into using e-commerce to expand the company's footprint.
    KC's View:
    Smart move. It may even allow Whole Foods to sell wine to customers living in places where it cannot sell wine in its stores.

    Published on: September 12, 2014

    Interesting piece in Fast Company about an Oregon company called Dave's Killer Bread, founded by a former felon, Dave Dahl, that has some 100 ex-cons working for it, or about one-third of its total staff.

    An excerpt:

    "Talk to (CEO John) Tucker about his bread company, and he’s happy to discuss growth, expansion, recipe, and so on. But you get the sense that he’s much more excited to talk about the way DKB can make a difference in its community, by giving a second chance to ex-convicts. Not only is DKB one of few companies that hire ex-felons at all, the company also runs what it calls 'partner enrichment programs' that educate these employees about how to manage a budget, resolve conflict, find housing, and so on. 'A lot of these individuals face lifelong challenges that stem from incarceration and the reasons for their incarceration,' says Tucker. 'We bring that support in-house. We don’t rely on them to go out and find it through public services'."

    And, the story goes on:

    "When Tucker tells people about the composition of his workforce, he’s often given the same barrage of questions, and he delights in answering. After doing some analysis with his HR group, Tucker compared the performance of the felons and non-felons among his staff. 'Overall the ex-felons’ performance rating is slightly higher than non-felons,' says Tucker. 'Most people think it’s the opposite: that the ex-felons are a challenge, are difficult. That is simply not the case.' Tucker says that more businesses--many more--should hire felons."

    You can read the entire story here.
    KC's View:
    Two things.

    One, just to keep things in perspective, it is important to know that founder Dahl once again found himself facing criminal charges this summer related to an unfortunate encounter he had with police. Dahl has said that he has been struggling with alcoholism, bipolar disorder and depression, and has gone to rehab.

    The other thing to tell you is that I've completely fallen for Dave's Blue Bread, which is whole wheat bread rolled in organic blue corn meal, which gives it this great crunchy crust. The only problem is that you can't get it on the east coast, so I have to order it online.

    The social message is instructive. The bread is delicious. That's enough for me.

    Published on: September 12, 2014

    • The Nielsen Co. is out with a new study saying that in the US, 171.5 million people (71%) own smartphones, and that "in the second-quarter 2014, 85% of Millennials aged 18-24 own devices and 86% aged 25-34 own them, an increase from 77% and 80%, respectively, in second-quarter 2013.
    KC's View:

    Published on: September 12, 2014

    • The Puget Sound Business Journal reports that Kroger-owned Fred Meyer there "could be hit by a strike by Teamsters. According to the union, contract talks between its 400 warehouse workers and Fred Meyer broke off last night, with no more talks scheduled."

    The contract expired on July 12.

    USA Today reported that McDonald's has filed a federal trademark registration for the name "McBrunch," leading to speculation that the company may try to develop a new meal segment to bolster its troubled business.

    However, McDonald's management says that any such speculation is "highly premature."

    • California Gov. Jerry Brown has signed a bill that "aims to crack down on retailers seeking to stop negative online reviews by requiring consumers not to make negative public comments about the business," the Los Angeles Times reports.

    The new law makes it illegal for companies to include "disparagement clauses" in the terms and conditions that often accompany online purchase agreements.
    KC's View:

    Published on: September 12, 2014

    Glenn Snyder, one of the most influential writers and editors in the supermarket industry, has passed away, due to complications related to Parkinson's disease. We asked Michael Sansolo, who worked with Glenn for many years, to offer some remembrances…

    For nearly 50 years, Glenn Snyder was a tireless advocate of the changing face of the supermarket industry, particularly the inclusion of general merchandise and health and beauty care. He wrote countless articles in Progressive Grocer about the benefits to sales, profits and customer satisfaction that robust non-foods could create.

    Honestly, he was relentless about it and thankfully I got to experience it during my 13 years as his colleague. One of my favorite magazine covers was a parody of the famous New Yorker view of the world, done through the eyes of our non-foods’ maven. In that world, produce and meat were small, distant departments, while non-foods categories dominated the landscape.

    Glenn’s tireless efforts were well known throughout the industry to the point that a rival magazine once honored him as one of the key difference makers in advancing the cause of what were then new categories.

    More than that, he was a friend and mentor who helped me immensely when it came to both public speaking and the value of well-timed irony. Everyone who knew him well understood that Glenn possessed remarkable timing when it came to exasperated sighs.

    Glenn had been battling Parkinson’s disease for many years before passing away this Sunday. His voice, presence and sighs will all be missed.
    KC's View:

    Published on: September 12, 2014

    Yesterday, MNB took note of a Neil Irwin column in the New York Times about Apple's new mobile payment system, called Apple Pay, that is designed to replace credit cards. The question he asked is whether the problem Apple is trying to solve - having to pull out a credit or debit card to make a purchase - is nearly as onerous as it suggests it is. And Irwin suggested that banks and retailers, which have to bear the costs of data breaches, may end up being a lot more enthusiastic about Apple Pay than consumers.

    (You can read the column here.)

    One MNB user responded:

    I followed your link to the NY Times to read Neil Irwin's story about Apple Pay.  I will agree with Neil that the "fumbling, bumbling, tic-tac laden" video that Apple played wasn't a particularly valid indication of the challenge related to the credit card payment process.  Using a credit card to purchase goods is pretty seamless, but I think Mr. Irwin misses the larger point.  He suggests that the security benefits are largely enjoyed by retailers and banks, but ask someone who's credit card information was stolen during the recent Target/Home Depot/Nordstrom/Supervalu (I can go on and on here) if they feel like it was just an annoyance for the retailer and their bank.  That same credit card number is probably used to automatically pay 3-4 bills per month for household services. Additionally, the payment information is probably stored on 10+ online retailer sites, requiring the user to change as many as 15-25 saved credit card.  These same consumers are signing up for free credit monitoring services provided by the retailers to have some peace of mind that they don't become the subject of the identify theft.  The security issue is not a made up event and it certainly has an impact on the consumer.

    Lastly, I'll point out that my wallet continues to get thinner thanks to my phone.  Instead of carrying cards for health and dental insurance, I now have two apps on my iPhone that display the card information when I see those providers.  My Kroger app pops up a copy of my loyalty ID when I walk into the store that I can scan on the register.  More and more services are moving to your smartphone, so I think it's inevitable that payment cards go there as well.  The phone has one risk that your wallet doesn't, dead battery, but I think the upsides far outweigh that downside and mobile payments will continue to get traction.

    MNB user Herb Sorenson wrote:

    Kevin, on the Apple Pay, Irwin is too cute by half.  Buying one cup of coffee is not what this was created for, but to eliminate a whole pocketful of cards, and ultimately allow checkout to be eliminated altogether.  Take an item off the shelf and out of the store and it is automatically paid for.  We're not there, but credit cards are SO transactional, rather than simply getting the job done.  Credit cards deserve to go the way of the buggy whip, and the sooner the better!

    And from another:

    I think the author is dinosaur.  Finding your phone would be as tough as finding a credit card?!  Really?  Go ask some twenty year olds to pull each out.  Time which is faster?  Their phones are super accessible!  I am 44 and I always have my phone with me.  Not true of my wallet.  My phone locks.  My wallet does not.  Apple will prevail on this.  The banks will want it and the customers will want it.

    I agree. Sometimes it is fun to throw these columns up like a jump ball and see what happens. I'm one of those people who has transitioned many of his cards to the iPhone, and I see no reason that won't continue.

    Differing opinions on whether Starbucks should do away with its ban on visible tattoos.

    MNB user Stephanie Steiner wrote:

    Tattoos are just as accepted in the northwest as salmon and rain – so I find it difficult to believe that Starbucks even had this policy, let alone kept it this long.   The organization has done amazing things to improve their customer service over the past few years, and today I consider them one of the best at it.  I’d take a great experience from a tattooed staff member over a lousy experience from a “button down,” any day.  Our retailing world has changed – we don’t get to dictate what is relevant.  We can only make sure that relevance is our highest priority.  I’m happy to see their decision-makers get it, and proud of the 21,000 people who signed that petition.  Maybe someday I’ll even get a tattoo of my own, but for now I’m headed over to get an iced coffee.

    But MNB user Bob Vereen wrote:

    What young people who get tattoos don't realize is how bad those will look as they get old.  If you see guys who were in service years ago with tattoos, you realize how they will look later.

    I think I'm with Stephanie on this one. As I said yesterday, I'm not big on tattoos … but I'm way past the point of making value judgements about the people who have them.
    KC's View:

    Published on: September 12, 2014

    In Thursday Night Football action, the Baltimore Ravens defeated the Pittsburgh Steelers 26-6.
    KC's View:

    Published on: September 12, 2014

    First of all, let me get the heresy out of the way.

    "Blind Spot," by Reed Farrel Coleman, may be the best Jesse Stone novel yet. And that includes the nine books in the series written by its creator, Robert B. Parker.

    Regular MNB readers may be surprised by by assessment. After all, as I've written here in various contexts over the years, I'm an enormous fan of Parker's, had opportunity to meet him a couple of times over the years and interview him once, and became friends with his widow, Joan Parker, after he passed away.

    My judgement of Coleman's "Blind Spot" does not diminish my respect for Parker's considerable accomplishments. But Coleman is an extraordinary writer and he brings his considerable talents to a series that was, to be honest, ill-served by the writer who took over the Jesse Stone series after Parker's death. Michael Brandman, who was involved with the successful TV movies about Stone featuring Tom Selleck, wrote three Stone novels, but while I respect anyone who even attempts to write a novel, his attempts were more well-intentioned than accomplished. (I've always suspected that because of his involvement with the movies, Brandman was a sentimental choice for the Parker estate. They did much better with their choice of the great Ace Atkins to continue the Spenser series … Atkins and Coleman are a one-two punch to be reckoned with, and I'm looking forward to following them for years to come.)

    But I can tell you this. I was just one chapter into "Blind Spot" when I realized that the series is now in the hands of a great writer. I did not know Coleman's work until now, but this is actually his 20th book. (He is perhaps best known for the remarkable Moe Prager series, which I've been devouring since finishing "Blind Spot.")

    I had the opportunity to sit down with Coleman for a few minutes this week to chat about what drew him to Jesse Stone, a former LAPD detective kicked off the force for excessive drinking, now seeking redemption and solace as a small town police chief in Paradise, Massachusetts. Coleman told me that when he started, he knew he needed to find a door that would both admit him to the house that Parker built, and allow him to find some rooms that Parker hadn't had the time or inclination to explore. That door, as it ended up, was Stone's background as a professional baseball player who was close to making it to the major leagues as a shortstop when he got hurt; "Blind Spot" starts with a reunion of his former minor league teammates, which opens old wounds and even creates a few new ones.

    "What I'm good at is understanding regret and the past," he said. "I can't say it any better than William Faulkner….'the past isn't dead, it isn't even past.' So that was the approach I took with Jesse - what was his big regret? I'm a baseball nut, I'm a huge Mets fan, I grew up with Lee Mazilli, so I know what it was like to be around somebody like that. I know what the difference is between being a good street player and being the guy. Just imagine what it's like to be one phone call away … I understood Jesse immediately."

    Coleman is a fascinating guy. He held down numerous jobs while writing poetry in his spare time, and was working as freight forwarder at Kennedy Airport in New York when he decided to take a writing class. As it happened, the only class that fit his schedule was American Detective Fiction, and the three major works that he read were Dashiell Hammett's "The Continental Op" and "The Maltese Falcon," and Raymond Chandler's "Farewell, My Lovely." He came away from that class in love with the genre, and convinced he could do it … mostly because when he read the words of Hammett and Chandler, he could hear the poetry in their language, something that distinguishes the best detective fiction.

    "When I finished 'The Maltese Falcon,' I went to my wife and said I wanted to finish up the year at work and then quit and try to be a writer," Coleman said. "Now I'd never written prose, ever….I just knew I could do it … What I saw in Chandler and Hammett was that they were poets. Chandler actually was a failed poet. I just saw that he understood the same things that I understood about poetry. I thought, I can do this. Listen to the poetry of their writing. There are very distinct rhythms."

    Years ago, as it happens, when I talked to Parker, he told me much the same thing. He was convinced that the reason people liked his novels was that they could hear the music in the language. One man's music is another man's poetry, but either way, you can hear it in the dialogue, the descriptions, the metaphors, even the odd combination of cynicism and idealism that characterizes so many many protagonists in the genre.

    Coleman says that in his opinion, some of the best-selling writers out there are neither musical nor poetic. "There's no music in John Grisham's writing," he says. "It's perfectly good writing, but there's no music in it … I was listening to Beethoven on the way into the city and I was thinking that there's nothing I can teach a writing class that Beethoven's Ninth can't teach a writing class - the drama, the conflict, the crescendos, the build up, the delivery … that's the way I feel about poetry and writing."

    I can tell you that in "Blind Spot," Coleman delivers. He observes the conventions of Parker's approach to writing - short chapters, snappy dialogue - without trying to imitate him. And Jesse's professional regrets, which Coleman described to me in our conversation, seem to have seeped into each and every page of the book - they infuse Jesse's every action, every statement, every drink. It is palpable, and that's remarkable.

    Even if you've never read another Jesse Stone novel, I'd encourage you to read "Blind Spot." I'd then suggest you do what I'm doing, and work your way through the rest of the Reed Farrel Coleman oeuvre. And then, I suspect, you'll do what I'll almost certainly be doing - waiting with great expectation for the next one. He is a terrific writer.
    KC's View: