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    Published on: January 6, 2015

    by Michael Sansolo

    If there’s one thing guaranteed to follow the holiday season it’s the endless tales of customer service issues. And because we are all essentially in the customer service business, these stories are important reminders of the right or wrong ways to do this.

    With that in mind, read on and remember this: this story is completely true.

    I received a call in mid-December from a woman named Lisa, who had some bad news - a shipping label had fallen off a package we'd sent to our nephew in Westport, Connecticut. All that remained on the package was the return address - the package was in Westport, but they had no idea where to deliver it.

    So Lisa looked up my number and called me. She explained the situation and said that if I gave her the address to which the package was supposed to be delivered, she'd put it on the box and send it on its way. Otherwise, they'd have to return the package to me.

    I think it is fair to say that we almost fainted. That kind of customer service seemed way beyond the call of duty, especially during the busy holiday season.

    I thanked Lisa profusely and gave her my nephew’s address. One day later, my sister told me that her son's present had arrived; she said she planned to bring Lisa a gift once the holiday rush was over.

    Now, here's the kicker. Lisa doesn't work for UPS or FedEx.

    She works for the US Postal Service (USPS).

    Now, Lisa's extraordinary act of customer service probably won't result in anything tangible. It's not like I'm going to abandon email and start mailing letters because of what she did. She's not going to get a raise, she won't be the next Postmaster General, and beyond this column, she's unlikely to receive any kudos for her deeds.

    But I am reminded of something that Herb Kelleher, the founder of Southwest Airlines, once said: “Culture is what you do when nobody is looking.”

    Sure, the US Postal Service has its problems. But it still has the power to rock our world. And Lisa, a person I am unlikely ever to meet and who had no reason to extend herself on our behalf, proved it.

    If the USPS is to have any prospects in the future, it has to hope that Lisa isn't an anomaly, and that there is a culture of customer service that is contagious and sustainable.

    Because while maybe nobody is looking, this kind of service can result in a lot of people paying attention.

    Michael Sansolo can be reached via email at . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available on Amazon by clicking here. And, his book "Business Rules!" is available from Amazon by clicking here.
    KC's View:

    Published on: January 6, 2015

    by Kevin Coupe

    Okay, this is my idea of infrastructure rejuvenation.

    Wired has a story about how, in Bruges, Belgium, the city council has approved a plan developed by the De Halve Maan brewery - which has been making beer there for almost 500 years - "to save time and money while reducing emissions and congestion" while getting beer from the brewery to a new factory where it can be filtered, bottled, and shipped.

    They're going to build a beer pipeline that will run underground from one place to the other.

    According to the story, "Instead of making the three-mile drive in one of dozens of tankers that traverse town each day, the award-winning beer will flow through a 1.8-mile polyethylene pipeline, making the trip in 15 to 20 minutes. The pipeline will move 6,000 liters of beer every hour ... De Halve Maan gets to move its beer swiftly and efficiently, without giving up the medieval site that draws more than 100,000 visitors every year. Bruges doesn’t have to spend a dime, since the brewery guarantees it will cover the installation and road repair costs."

    And as Wired points out, almost nobody will complain if a pipe bursts. They'll just grab mugs and head for the streets.

    It strikes me as a perfect - and Eye-Opening - public-private partnership. And how politics really should work.
    KC's View:

    Published on: January 6, 2015

    The Wall Street Journal reports that Amazon said this week that "third-party merchants were responsible for 2 billion items sold last year, double the total in 2013, even as the number of such businesses held about steady compared with the prior period at 'more than 2 million'."

    To put that into context, the third party sales represented more than 40 percent of the items sold on Amazon's site during 2014.

    The Journal writes that "Amazon profits from outside sellers by taking a percentage commission when their goods are sold, as well as other fees, such as for storing their items. Some analysts believe the profit margin is higher on many items sold by outside parties than those sold directly by Amazon."
    KC's View:
    It always has been explained to me that third party sales is one of Amazon's real competitive advantages in its competition with Walmart. Think of it - two million businesses are selling product through Amazon, which makes its site a lot more robust than it would be otherwise. Amazon competes with those companies on price when it wants to, and doesn't when it doesn't want to. The result is a dynamic pricing model that is, well, dynamic.

    Yet another reason that Amazon should not be underestimated.

    Published on: January 6, 2015

    Pet supply retailer Petco said yesterday that it "has removed all remaining Chinese-made dog and cat treats from its website and stores nationwide because of concerns they have sickened thousands of pets and killed 1,000 dogs in the U.S. since 2007," according to a story from the Associated Press.

    The story says that "the FDA targeted the treats after receiving more than 4,800 complaints of pet illnesses, including the deaths, after pets ate chicken, duck or sweet potato jerky treats from China. Tests have not confirmed any connection, but the agency is still investigating ... Petco is the first national pet retailer to pull the treats from its 1,300 stores. Phoenix-based PetSmart Inc. said Monday that it plans to have them off shelves at its roughly 1,300 stores by March."
    KC's View:
    Retailers are responsible for what they sell ... and so they have no choice but to dump items that are questionable. The obligation is legal, moral and fiduciary.

    And isn't this yet another argument for Country of Origin Labeling (COOL)?

    Published on: January 6, 2015

    There's an interesting piece in Inc. by Bert Jacobs, chief executive optimist and cofounder of The Life Is Good Company, in which he describes how leadership is relaunching the company. "Our mission, vision, and values will remain intact, but pretty much everything else is about to change," he writes.

    The reason? Well, it has to do with demographics. People who know and love the Life Is Good brand are aging, and they realized that they needed "to attract new, younger customers. To broaden our reach we must deliver our message in new ways while remaining authentically Life Is Good to the faithful."

    And that meant changing while going back to the beginning ... a story that you can read in its entirety here.
    KC's View:

    Published on: January 6, 2015

    • The Wall Street Journal reports that Walmart's troubled Mexican business, which has been suffering from "deteriorating" sales, has turned to a small-store format to rejuvenate its prospects.

    "Walmart’s solution for Mexico is a mini-grocer format called Bodega Aurrera Express, which the company launched in 2008," the Journal writes. "The store looks like an oversize mom-and-pop shop, with products stacked high against the walls. Bodega Aurrera’s mascot is Mama Lucha, a chubby cartoon homemaker dressed like a masked wrestler, who fights for the best prices."

    The hope is that the format will appeal to the eight out of 10 customers in Latin America who are either middle class or poor, and who "tend to shop in small grocers and family-owned shops."
    KC's View:

    Published on: January 6, 2015

    Variety reports that Netflix is looking to expand its sphere of consumer influence by creating a "'Netflix Recommended TV' certification program under which it will give the thumbs up to Internet-connected television sets that deliver the best possible video-streaming experience for its service."

    “We’ve created the ‘Netflix Recommended TV’ program to help consumers identify smart TVs that offer better performance, easier menu navigation and new features that improve the experience for Internet TV services,” Neil Hunt, Netflix’s chief product officer, tells Variety.
    KC's View:
    This is kind of brilliant, when you think about it ... a seal of approval that curates products that Netflix sees as being supportive of its ecosystem. That's what more retailers ought to do, I think ...

    Published on: January 6, 2015

    Media Post reports that Taco Bell is hoping to stimulate use of its new mobile ordering application by giving away Doritos Locos Tacos - a million of them.

    According to the story, "The offer is being highlighted on social media and as part of a new TV spot that promotes the benefits of the app, which is compatible with both iOS and Android ... The promotions seem to be working: The app has been downloaded on iTunes and Google Play more than 1.4 million times since it debuted in late October."
    KC's View:

    Published on: January 6, 2015

    • The Sacramento Bee reports that a California Superior Court judge has ordered "Safeway to pay nearly $10 million to 41 California counties and cities for illegally disposing of household chemicals and medicines from its stores and distribution centers over a seven-year span." According to the story, the settlement "stems from allegations that more than 500 California stores and distribution centers in the Pleasanton-based supermarket chain improperly handled and disposed of hazardous and pharmaceutical waste that came from spills and customer returns."

    Safeway did not admit any wrongdoing, but conceded in a statement that it was “among a number of retailers to agree to changes in how it characterizes everyday retail items no longer for sale as hazardous waste,” items such as aerosol sprays, detergents, hair dyes and antibacterial soaps, the story says.
    KC's View:

    Published on: January 6, 2015

    Got the following email from a reader reacting to our commentary yesterday about Haggen using private equity money to grow from 18 to 164 stores, acquiring units that must be divested as Albertsons acquires Safeway:

    The timing for this acquisition/expansion could not be worse, as ALDI is entering the Southern California market with 50 stores over the next 12 months now that their distribution center is complete.  This will force a price war, as all grocery retailers, regardless of format or strategic focus, will be impacted by this low cost/low retail operator.  And, this will be just their first 50 stores.  Look for at least a doubling of that amount of stores the following year.

    Like I said yesterday, everything has to go right for Haggen to make this work. And one of the things that has to go right is for the competition to be cooperative. Which is almost certainly won't be.

    MNB yesterday took note of a Wall Street Journal story about improved foodservice options at supermarkets and convenience stores, which are hoping to "woo eaters from traditional restaurants and burger joints and lead them to buy other goods the stores sell as well."

    I commented, in part:

    In many ways, this is an old story. I've been doing this a lot of years, and it is hard for me to remember a time when food stores were not trying to use foodservice offerings to compete with restaurants. Indeed, there have been consultancies that have built businesses out of helping retailers find ways to do so. (And some of them actually worked.)

    MNB reader Caroline Perkins wrote:

    I, too,have been writing about this for ages. Supermarkets are doing a better job but it's occasion based. If you are on a business lunch, a romantic date or after theater, you're not going to WaWa.

    True. But I'm told that they will, occasionally, go to Wegmans.

    However, you're right. There are some situations that supermarkets can't compete in. But I still think they have to play hardball, and compete for every bit of share of stomach that they can.
    KC's View: