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    Published on: September 17, 2015

    This commentary is available as both text and video; enjoy both or either ... they are similar, but not exactly the same. To see past FaceTime commentaries, go to the MNB Channel on YouTube.

    Hi, Kevin Coupe here, and this is FaceTime with the Content Guy.

    Pretty much all of my weeks are pretty good, but some are better than others. You can tell by looking around that this is one of the better ones ... I'm in Chatham, Massachusetts, to talk to the New England Produce Council and moderate a panel discussion with various retailers about how an evolving and competitive marketplace is affecting the produce business. After all, fresh fruits and vegetables represent a category where food stores - and that's what supermarkets are supposed to be - can really differentiate themselves.

    It seems to me that, based on my conversations with the folks on my panel, that perhaps the most important item that retailers and suppliers have to offer is information.

    That's not to say that the quality of the fresh fruits and vegetables being sold is secondary. Far from it. In fact, quality ought to be a sort of a given when we're talking about this category.

    But information, in many ways, is the glue that holds everything together. It is the information that you give consumers about the items you're selling, and how to eat and/or prepare them. It is the information that you give to the store employees on the front lines, so they know something about what they're selling other than this is how it is stacked and this is what it costs. It is about using both traditional and non-traditional venues to reach out to consumers, to tickle their fancies, provoke their interest, stimulate their imaginations.

    There's a lot of competition in this segment ... mostly because everybody knows that fruits and vegetables done well can be an enormous differential advantage. There's everything from Whole Foods to Sprouts, Community Supported Agriculture to Amazon Fresh. There are traditional food chains and coops and all manner of retailers who have decided that they want to serve as the consumers's source of great fruits and vegetables.

    That the products have to be of high quality goes without saying ... except that I'm saying it. But that they have to be explained and sampled and described and defined and put into the larger context of how the consumer lives ... well, that ought to go without saying, too...except that I'm saying it.

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

    KC's View:

    Published on: September 17, 2015

    by Kevin Coupe

    Columbus Business First reports that the Columbus Clippers, the Triple-A affiliate of the Cleveland Indians, found a unique way to simultaneously fill the ballpark and reward loyal fans who wanted to attend playoff games.

    Free tickets. In fact, this week, all tickets to all of its home playoff games were free.

    “It’s a tough time of year," says General Manager Ken Schnacke, noting that college and professional football tend to take over the public consciousness. "When the calendar flips over to September baseball becomes secondary. We’re always a little frustrated, and we want to help the (team) so I decided, let’s see what happens. I’m just trying to create some excitement ... Sometimes, you just have to do something completely outlandish, and this is very outlandish. It’s the first time in 39 years.”

    Well, that's one way to put fannies in the seats.

    The thing is, tickets to minor league games don't cost that much anyway, and I'd be willing to bet that the Clippers could make up for some of the ticket revenue through vendor sales.

    But to me, this story reflects the fact that minor league baseball has always been a great metaphor for how retailers should approach a competitive marketplace. If you're running a minor league baseball team, you can't really market the stars of the team ... because if they're any good, they're not going to be around long. So you have to market the experience ... and to do that, you actually have to create a better experience. When football threatens to attract everybody's attention, you have to find new and innovative ways to grab people's attention.

    In this case, the innovation was an Eye-Opener.
    KC's View:

    Published on: September 17, 2015

    Amazon yesterday announced an expansion of its Prime Now one-hour delivery service in Southern California, saying that it now will service both Los Angeles and Orange County locations, including Santa Monica, Redondo Beach, Silver Lake and Irvine out of four hubs located in the area. In Los Angeles, Prime Now is available from 8 a.m. to midnight, seven days a week. Two-hour delivery is free and one-hour delivery is available for $7.99.

    The announcement notes that "in the next few days, Prime Now will also add deliveries from some of LA’s favorite local stores, such as Sprouts Farmers Market, Bristol Farms, Sprinkles Cupcakes, Fresh & Easy, Erewhon Organic Grocer and 99 Ranch Market."

    The expansion brings to 13 the number of cities served by Amazon Prime Now.

    In other Amazon-related news...

    • Amazon announced that members of its Prime program will now get six months of free access to the online version of the Washington Post, which happens to be owned by its CEO, Jeff Bezos. According to the announcement, "After the first six months of access to world-class national and international news, Prime members can continue to enjoy unlimited digital access with a discounted monthly subscription rate of only $3.99, a savings of 60% per month."

    Prime members can access the Post read news on iOS, Android and Amazon Fire devices or via its website.

    • A space exploration company called Blue Origin that was started by Jeff Bezos announced this week that it will begin building and launching rockets from Launch Complex 36 at the Cape Canaveral Air Force Station, which the New York Times writes is "the historic site of 145 launches, including those of Pioneer 10 from NASA, the first spacecraft to visit Jupiter, and Surveyor 1, the first craft to make a soft landing on the moon."

    Blue Origin "will invest $200 million and create 330 jobs." the Times writes, adding, "It is the latest effort to revive Florida’s Space Coast, which was economically battered after NASA stopped flying the space shuttles in 2011. Space Exploration Technologies Corporation, or SpaceX, the rocket company started by Elon Musk, and the United Launch Alliance, a joint venture between Boeing and Lockheed Martin, already use nearby launching pads at Cape Canaveral."
    KC's View:
    Not surprised by the expansion of Amazon's physical and virtual service. But I'm more intrigued by Bezos' captivation with rockets and space exploration.

    First of all, I'm glad that people like Bezos and Musk are investing in something that the government has decided no longer is in its best interests. Foolishly, I think, but that's another story.

    But I'd like to suggest that there's something else at work here. Think, for a moment, about all the technological innovations that grew out of the Gemini and Apollo missions ... it's possible that Bezos is trying to recreate the innovation laboratory that NASA so successfully developed in the sixties and seventies, believing that there could be game-changing opportunities revealed somewhere along the line.

    I wouldn't bet against it.

    Published on: September 17, 2015

    Bloomberg reports that Target is offering free Fitbit activity trackers to all of its 335,000 employees in the US, "becoming the latest firm looking to the inexpensive wearable devices as a way to improve its workers' fitness and reduce health-care costs."

    According to the story, "Target employees will be able to get Fitbit's most basic device, a clip-on tracker called a Zip that retails for $59.95, for free. Or they can buy a more-expensive wristband with Target subsidizing the cost ... Workers who opt in will be organized into teams for a monthlong competition, and the winning team will get to pick a charity to receive a $1 million donation. Fitbit will work with Target to design further programs around the devices."

    While Target's motivation is related to having a healthier workforce, Fitbit's motivation is to grow its corporate services business, which currently accounts for less than 10 percent of its total revenue. The story notes that "one of Fitbit's customers, Appirio Inc., shaved 6 percent off its health bill after the first year using the device ... Other corporate customers include Bank of America Corp., Time Warner Inc. and BP Plc."

    Jodee Kozlak, head of human resources at Target, says that the move "is part of the retailer's effort to improve its image as a wellness company ... Next year, it plans to start promoting more healthy foods and products to its customers from the moment they enter the store to when the leave at the checkout aisle. It will also give employees a discount on healthy foods, with the hope that the effects will trickle down to consumers."
    KC's View:
    This probably won;t have an enormous impact ... but even if it doesn't, I think it helps Target address health costs within the organization. A smart move ... I've learned that people who use the Fitbits often get addicted to them. (Mrs. Content Guy hardly goes anywhere without hers.)

    Published on: September 17, 2015

    The US Department of Agriculture (USDA) and a coalition of food retailers and manufacturers yesterday announced what they called "the United States' first-ever national food waste reduction goal, calling for a 50-percent reduction by 2030. As part of the effort, the federal government will lead a new partnership with charitable organizations, faith-based organizations, the private sector and local, state and tribal governments to reduce food loss and waste in order to improve overall food security and conserve our nation's natural resources."

    Leslie Sarasin, president/CEO of the Food Marketing Institute (FMI), said, "Food retailers are community minded, neighborhood focused and intimately connected to the lives of their shoppers; as such they work closely with their customers on those issues touching both the heart strings and the purse strings. Reducing food waste at all levels in the food chain - farm, factory, store and home - is certainly one of those issues with economic and emotional appeal."

    And Jonathan Mayes, senior vice president os Albertsons, said, "Reducing food waste is an important priority for Albertsons Companies. As part of the U.S. Food Waste Challenge, we are focused on source reduction as well as providing food to other good causes such as hunger relief organizations and animal feed."

    The announcement noted that the national commitment "occurs just one week before world leaders gather at the United Nations General Assembly in New York to address sustainable development practices, including sustainable production and consumption."
    KC's View:

    Published on: September 17, 2015

    Taco Bell next week is scheduled to open a new format restaurant, called Taco Bell Cantina, that, according to the Orange County Register, features "alcohol, a tapas-style menu and mobile ordering technologies. In addition to the regular Taco Bell menu, new appetizer-inspired menu items – available during the evenings – include a variety of nacho platters and rolled tacos."

    And no drive-through.

    The story notes that the first Taco Bell Cantina will open in San Francisco, with a second one to open shortly thereafter in Chicago. If the tests work, Taco Bell says it could open as many as 10 additional Cantina units next year.

    Yum Brands-owned Taco Bell tells the Register that the format "represents an attempt by the fast-food chain to create a new concept that caters to experience-driven millennials who seek 'urban environments to live, work and play'."

    “These new urban restaurants are a critical part of our growth strategy in markets where people experience our brand differently,” says CEO Brian Niccol. “Today’s consumers are living in more urban settings, and our new restaurants cater to their lifestyle in adapting our traditional restaurant concept to fit their modern needs.”

    The Register notes that "Taco Bell Cantina is the second new concept for the Mexican fast-food chain. Last year, the company unveiled U.S. Taco Co., a fast-casual eatery with a menu of American-inspired tacos. The Huntington Beach restaurant began selling craft beer in July after it originally failed to secure an alcohol license when it debuted."
    KC's View:
    I tend to lump Taco Bell into the same fast food category as McDonald's, so my first instinct is to be a little skeptical about Taco Bell's efforts. That said, this would seem to be a move that is in the right direction ... and Taco bell's sales have been pretty healthy of late. So who am I to judge?

    Published on: September 17, 2015

    Bloomberg reports this morning that Ocado Group CFO Duncan Tatton-Brown says that he won't be surprised if Amazon decides to bring its Amazon Fresh service to the UK.

    Tatton-Brown says that in the long run, an Amazon Fresh entry in the UK could be good for Ocado because it would enlarge the slice of the retail pie owned by e-grocers.

    The story notes that "Amazon, which has more than 7,000 non-food workers in the U.K, said last month that it took a lease on a warehouse just outside London, fueling speculation that it is seeking to start a British grocery service."
    KC's View:
    Suggesting that Amazon Fresh could be good for everyone in the e-grocery trade strikes me as wishful thinking. In this case, be careful what you wish for.

    Published on: September 17, 2015

    Reuters reports that there has been a fracture in a pro-worker, union-supported organization called OUR Walmart that has lobbied the company to raise pay and improve working conditions at the retailer.

    According to the story, the organization "has splintered over a disagreement about funding and strategic direction, according to people on both sides of the split.

    "Both wings are claiming the name OUR Walmart and vow to continue their work, moves that could sow confusion among supporters. The United Food & Commercial Workers International Union (UFCW), which for years has provided important funding and resources to the OUR Walmart worker group, will only financially support the wing that it believes represents the broader set of workers." The other group says it will re-launch with new funding partners.

    The story quotes Wal-Mart spokesman Brian Nick as saying that none of this stuff influences the company, saying that while "'unions and allies they fund spend time and membership dues attacking' the company, it had spent $1 billion this year to raise wages and was working to provide training and other opportunities to its 1.4 million U.S. employees."
    KC's View:

    Published on: September 17, 2015

    • Toys R Us this week said that "it plans to hire fewer holiday employees than it did last year but will give them significantly more hours in hopes of boosting sales as customers have a better experience," the Chicago Tribune writes.

    In addition, "UPS said Tuesday that it plans to hire 90,000 to 95,000 holiday workers nationwide to handle shipping and deliveries, about the same as last year ... UPS, which came under fire for late deliveries during a last-minute rush of online shopping spurred by retailers' promises of free shipping, told the Associated Press that it is better prepared this year because it is getting more updates from customers on how many orders they expect."

    And, "Target announced Monday that it plans to hire 70,000 holiday workers at its stores nationwide for the third year in a row."
    KC's View:

    Published on: September 17, 2015

    ...will return.
    KC's View: