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    Published on: January 21, 2016

    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.

    A couple of weeks ago, I did my FaceTime commentary from the campus of the University of Florida in Gainesville, where I'd just finished teaching an honors class in which the book that Michael Sansolo and I wrote, "The Big Picture: Essential Business lessons from the Movies," is the semester's textbook.

    I was thrilled to be there, and totally jazzed about the class, and not just because they're using our book. I like the idea that the university is pushing the students to take classes that challenge the way they think about the world, and take them outside their comfort zones. If we get to be part of that, even better.

    What I didn't mention at the time was that I'd given the students a homework assignment to get them in the mood. I asked them to write a short essay on the following subject: Who would play you in a movie of your life, and why?

    I've done this a lot with groups over the years. It's fun, and it is designed to get people to think of themselves in terms of image vs. reality. If you think of yourself one way, want to be thought of another way (as idealized by an actor or actress), but realize that others perceive you differently, what does that tell you about your work life and management style?

    Dr. Allen Wysocki was kind of enough to share the essays with me, and I'd like to share a few of them with you.

    One young woman said Anne Hathaway, and referred to The Devil Wears Prada, in which Hathaway's character discovers by the end of the movie that a work-life balance is important. Seems to me that this is an important thing to know about yourself as you start your career; you may not want to work for Amazon, where CEO Jeff Bezos famously said that if you are worried about work-life balance, you must not like your work very much.

    One fellow said Matt Damon, because in many of his film roles he plays someone who a) likes adventure and b) likes solving new and complex problems. I totally get that ... for me, Matt Damon is one of those actors who always seems to be thinking onscreen. Again, if you like new situations and new problems, that's a good thing to know about yourself.

    Another said Amy Poehler, because her character on "Parks & Recreation" is so passionate, optimistic, lovable and even overly dramatic sometimes.

    From another - Tina Fey, who is both "chipper and sarcastic," but uses humor to deal with situations and to bring people together. Fey also is a self-proclaimed "nerd" who has embraced that image, which seems to give comfort to this particular students.

    There were lots of others, all excellent ... but you get my point. Answering the question, "who would play me in the movie of my life," allows us to think of ourselves in idealized ways, but also face the reality of who we are and how we act.

    Here's one of the lessons I learned: some of the actors written about were people I'd never heard of. Like Bethany Joy Lenz. Who knew? But the thing is, I have to understand as someone who is older and could be her manager that a young person's cultural frames of reference are going to be different from mine. If you know it, you can deal with it. if you ignore it, the result may be miscommunication.

    So thanks to the students at University of Florida for giving me an education. I hope you're enjoying the book and the class, and I'm hoping to get back down to see you again before the semester is over.

    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: January 21, 2016

    by Kevin Coupe

    There have been a couple of stories this week that grabbed my attention because they pointed to ways in which different demographics are behaving in non-traditional ways ... which in turn should suggest to marketers that they may need to adjust their assumptions about at least some of their customers.

    The Wall Street Journal reports that "a University of Michigan study of state driver’s licensing statistics shows a sharp decline over the past two decades among people under 25 years of age getting their driver’s licenses. The drop signals high-schoolers and college-age Americans are less interested in driving than previous generations. And the change is spreading to their parents and grandparents, moves that have auto makers scrambling to ramp up investments in alternative mobility services such car-hailing services."

    While these statistics would seem to be at odds with numbers pointing to 2015 as being the best year in history for the US automobile industry, the story notes that the population is growing faster than car sales, which would suggest that demand may, in fact, be waning. (Though, to be fair, it is remarkable that an industry that was hearing death knells a few years ago has rebounded as much as it has.)

    At the same time, the New York Times has a story about how some aging baby boomers, when embarking on retirement, are eschewing golf courses and resorts and instead are "traversing hiking trails, rivers and mountains," or getting in kayaks or on bicycles, choosing to spend their time on the Appalachian Trail or the Camino de Santiago rather than on the back nine.

    I love the guy in the Times story who says he's racing to "beat the aging cartilage in my knees," and squeeze in as much of this stuff as he can. And while I'm probably still 11-15 years from anything close to retirement, I have to say that all this stuff sounds a lot more attractive than a golf course or resort. (What would the MNB audience think if I decided to post each day while walking along the Camino de Santiago? I may have to find out one of these years...)

    But the larger lesson here is that today's customers do not necessarily match the expectations and categorizations of the past ... and marketers of all kinds have to be aware of these attitudinal and behavioral shifts.

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

    Published on: January 21, 2016

    The Triangle Business Journal reports that Wegmans has confirmed plans to build a story in Cary, North Carolina, and has signed a letter of intent with a real estate development company there. The store would represent a significant geographic push for Wegmans; its closest store right now is in Fredericksburg, Virginia, 230 miles north of Cary.

    The move would plunge Wegmans into a market where there already is some significant competition, with retailers that include Kroger, Kroger-owned Harris Teeter, Publix, Aldi, Food Lion, Lowes, Whole Foods, Trader Joe's and Earth Fare, many of which also have announced plans for new stores in the area. Walmart and Target also have multiple stores there.

    Wegmans, which currently has 88 stores, has a 2016 schedule includes three new Virginia stores - one in Charlottesville and two in Richmond. While Wegmans won't confirm it, there reportedly are plans for additional North Carolina stores, possibly in the Raleigh-Durham area.
    KC's View:
    It is an interesting choice by Wegmans, which continues to surprise me by not looking at Connecticut and the suburbs of New York City as a potential growth market. It would seem to fit more into its existing geographic footprint, but perhaps the lack of appropriate real estate and high taxes are keeping it away.

    The Tax Foundation says that New Jersey is the worst state in the nation in terms of pro-business climate (something that Gov. Chris Christie doesn't talk much about on the presidential campaign hustings), New York is second worst, and Connecticut is ranked # 44 (something that Gov. Dannel Malloy would prefer not to talk about). North Carolina, on the other hand, is # 15 ... and so it probably looks a lot more attractive.

    Published on: January 21, 2016

    Walmart announced yesterday that it give more than 1.2 million employees a raise on February 20.

    MarketWatch reports that "hourly workers employed in its stores as of Dec. 31 would get at least a 2% pay bump."

    According to the Washington Post, "The change includes a previously-announced increase to the retailer’s minimum wage, but also incorporates a plan to move forward in the calendar the annual raises that many workers would typically have received on the anniversary of their first day of work with the company ... Walmart had said last February that it would raise its minimum wage to $9 per hour in April 2015, with a second raise to $10 per hour planned for 2016."

    The Post goes on to say that "the policies by the world’s largest retailer represent a bid to better attract and retain talent at a moment when an improving economy has meant the labor market is more competitive.  And the plans are also part of the chain’s attempt to invigorate sales by offering better service in its fleet of more than 4,000 U.S. stores."
    KC's View:
    It is interesting that Walmart is giving raises at the same time that it is closing a bunch of stores. But McMillon has shown the willingness to move pieces around the board to serve a greater strategy ... and since he clearly feels that he has to push the envelope organizationally, this seems entirely within character.

    Published on: January 21, 2016

    The Golub Corporation announced yesterday that Scott Grimmett has been promoted from executive vice president/COO to be the company's president/CEO - the first person not named Golub in the company's history to hold the title.

    Jerry Golub, who has been CEO, now becomes vice chairman of the board, charged with leading "a new board finance committee focused on accelerating the conversion of Price Chopper stores to the new Market 32 banner." Neil Golub remains as chairman of the board.

    “This is an exciting time for our company,” Neil Golub said in a prepared statement. “While international conglomerates and Wall St. continue to consolidate our industry, we are investing in our future as a strong, American-owned, family-built regional chain. The design work that we invested in Market Bistro (circa 2010-2014), coupled with the brand-defining innovation that has given rise to our first few Market 32 concept stores has not only laid the groundwork for our continued growth, but also fueled the acceleration of our plans to modernize our stores under the Market 32 banner. ”

    Before joining Price Chopper, Grimmett spent 37 years at Safeway, starting as bagger and eventually serving as president of several of the company's divisions.
    KC's View:
    I've learned over the years that few things raise Neil Golub's ire more than being asked about rumors that the company is for sale. (I hate making those calls and sending those emails to him. But sometimes you gotta do what you gotta do.)

    So I had to chuckle when I read that he told the Albany Times Union that "companies that are going to sell themselves" don't make moves like this one.

    I absolutely take Neil at his word. And I do think that these moves are designed to help the company deal with what is a large and daunting task, converting not just the Price Chopper banner to the Market 32 banner, but converting the longtime brand equity associated with one to the other.

    As I've said here before, reinvention and revolution are critical these days to survival. This is exactly what the Golubs are aiming for, and I hope that they are successful.

    Published on: January 21, 2016

    The Wall Street Journal reports this morning that Uber "is preparing to go live with a full-scale meal delivery service across 10 cities in the U.S., an expansion that will test the company’s ability to use its drivers to move goods.

    "In the coming weeks, customers in such cities as Los Angeles, Chicago, New York and Austin, Texas, will be able to use a new, dedicated UberEats app to order from the full menus of dozens of local restaurants and have their food quickly delivered by an Uber driver."

    Uber seems to believe that despite all the competition in this space, much of it funded by venture capitalists looking for the next big thing, it can turn the segment into a new and profitable revenue stream. And there will be challenges, like "converting Uber drivers into delivery experts. Delivering food creates new challenges for drivers, who have to get out of their cars to pick up the food from a restaurant, quickly shuttle it to their destination and sometimes park illegally while they wait for customers to appear at the curb."

    The Journal reports that "Uber employs teams dedicated to UberEats in each city. They all plan to draw on what the company learned from its test in Toronto, including the discovery that typical customers prefer to rotate through about five of their favorite places. In Toronto, Thai food was the most popular order for dinner."

    According to the story, "Uber will continue to offer its lunchtime service for deliveries under 10 minutes, renaming it Instant Delivery. Some drivers who deliver for Instant Delivery are paid on an hourly rate and others are paid for every meal drop-off.

    "The company, which now offers its ride-hailing service in 375 cities world-wide, declined to comment on how soon its food delivery could expand to additional cities. On its website, Uber currently lists an opening for a general manager of UberEats in Paris."

    The Journal story makes mention of heightened competition, which is illustrated by a Boston Globe report that Peach, a text-based lunch delivery service, has expanded from Seattle and San Diego to Boston. According to the story, Peach uses text messaging rather than an app to connect consumers to a variety of restaurants in the Boston area.

    "Every morning, users will receive an automated text with three different lunch options from the day’s participating restaurant," the story says. "It includes a meat, vegetarian, and lite option, all priced between $9 and $12, that will be delivered to your office by 12:30 pm ... Tax, tip, and delivery are all included into the price, the service’s site states."
    KC's View:
    I think that one of the challenges that Uber is going to face is a kind of simmering unease with some of what we hear about its drivers, like the one in California who is accused of breaking a woman passenger's jaw after they disagreed about the music being played in the car.

    This kind of stuff is finding its way into popular culture. last night's "Criminal Minds" featured a driver for an Uber-ish service who was kidnapping patrons and then cutting their heads off in a guillotine. (You gotta love "Criminal Minds," which must have some of the more depraved - and I say this with utter admiration - writers working today.)

    Nevertheless, while there almost certainly will be companies washed out by all the competition, there certainly seems to be a lot of momentum for this general business model. Traditional food marketers ought to be thinking about how to cash in by targeting their existing customer base; after all, they won;t have to build their customer lists from scratch, and they have data about what people want and need.

    Published on: January 21, 2016

    The Indianapolis Business Journal reports that Marsh Supermarkets, which in recent years reduced its store count from 116 to 73 as it dealt with heightened competition and looked to get rid of unprofitable units, plans to remodel and update 30 of its remaining units.
    KC's View:
    This may be a case of ante up or go home ... Kroger has announced its plans to spend more than $400 million to expand and upgrade its Indianapolis fleet of stores.

    I would suggest to Marsh, with all due respect, that perhaps it needs to think beyond "remodeling" and instead focus on "reinvention."

    Because it seems to me that in order to thrive in 2016 and beyond, it isn't enough to invest in some new cases and a fresh coat of paint. If it were me, I'd be asking questions about the fundamentals of the business, and where the holes are ... I'd be looking for places to make a dramatic and unambiguous statement about how we are going to invest in a shopping revolution.

    Because I'm not sure that incremental steps are nearly enough, especially for a 73-store regional grocer. Good enough simply isn't good enough.

    It seems to me that decades ago, Marsh was a cutting edge retailer. For lots of reasons, it has lost the edge. The only way to thrive is to regain it.

    Published on: January 21, 2016

    Climate Home reports that at the World Economic Forum in Davos, Switzerland, Walmart CEO Doug McMillon derided climate change skeptics and said that addressing its challenges have been good for business.

    “At Walmart, we are very familiar with skepticism,” he said. “It’s got to a point where we just ignore it. Doing the right thing is good for business. Where the population is not like-minded it doesn’t matter. The decisions behind the scenes improve the products we’re making.”

    The story notes that Walmart "was among 114 major companies committing to science-based targets at a UN summit in Paris, where 195 countries struck a landmark climate pact.

    "Critics say it has not lived up to previous green promises, however. A 2013 report by the Institute for Local Self-Reliance found its emissions had risen over the previous decade and it was more carbon intensive than competing chains. Defending its record, the company pointed out its emission rose 10% from 2005 to 2011, slower than sales growth at 44%, showing improved efficiency."

    Fortune reports that as Walmart closes more than 250 stores around the world and starts to merge its technology and e-commerce businesses as it looks to compete more effectively online, it has become "one of the top companies posting jobs for software developers for applications ... Wal-Mart would love to chip away at Amazon’s online retail dominance, and attracting top-shelf software developer talent–especially coaxing that talent from Amazon–would be a big step toward doing that."
    KC's View:

    Published on: January 21, 2016

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

    • The Minneapolis/St. Paul Business Journal reports that Target CEO Brian Cornell, in his capacity as the company's acting chief merchant (until a replacement for Kathee Tesija, who left in June,, is named), is spending time going on home visits during which he interviews Target customers.

    It is an old-fashioned approach, Cornell says, but an effective one (that depends, to some degree, on the customers not realizing who he is).

    "“Our overall focus — on being closer to the guest, closer to the consumer, being externally focused — means you have to get out there and listen," he says. "I spend a lot of time in houses and in stores, just listening to our front-line organization and the guest."

    I've always felt that in retail companies, CEOs ought to be the de facto chief merchants ... I think it is great when they get out there and do this kind of stuff. I also love the idea that Cornell compares Target's approach these days to Bruce Springsteen: "In order to keep making good music, he had to evolve with the time,” he says. Bingo.

    • The Associated Press reports that "JCPenney will sell refrigerators, washing machines and other appliances at some of its stores for the first time in more than 30 years." The move, according to the AP, "comes as many department stores are under pressure to attract shoppers who are spending more money on their homes than on clothing."

    JC Penney says this is a response to customers who go on its website and search for refrigerators and washing machines.
    KC's View:

    Published on: January 21, 2016

    Got the following email from an MNB reader who wanted to respond to our stories about Amazon's automatic replenishment initiatives:

    I am surprised nobody has commented on Amazon's replenishment buttons and how Amazon hopes to hide the actual cost of the product within the thin guise of convenience. I compared Amazon's price for liquid Tide HE 110 load with our local Safeway and Frys stores and both grocery stores were $5 - $10 cheaper without being on sale. (Prime membership included in equation.) Once coupons and local sales are factored in, the price gap widens even further. This doesn't even include Amazon's fluctuating price/time model but I'm not sure if it relevant in this case.

    Unless there are limiting environmental factors such as lack of transportation or customer physical limitations, I don't see why people would want to use these buttons. The button seem to resemble the credit card methodology which has enslaved too many people with a  get your stuff now, worry about the cost later complacency. Convenience is nice but if people realize the full cost of the items, stopping by their preferred shopping place still wins out. I enjoy purchasing items from Amazon but I'm not falling for this trick. The other buttons may be a great deal, but I didn't check. At the end of the day, consumers must do their home work or they will be suckered into spending more of their hard earned cash than necessary.

    And responding to yesterday's story about the new Stew Leonard's on Long Island, MNB reader Bryan Silbermann wrote:

    Your story today on Stew Leonard’s featuring the upside down cow strongly evokes my response to the provocative living sculpture at the Massachusetts Museum of Contemporary Art (MASS MoCA) in North Adams, MA.

    Natalie Jeremijenko’s long-term installation called “Tree Logic” lines the path to the entrance.  And its logic is to get you to think differently about art as you enter the museum – basically, to upend your traditional way of thinking about the place you’re about to enter.  Which is exactly what Disney’s Imagineers told Stew about “gravity not mattering.”  Just as MASS MoCa teaches one not to consider trees as earthbound nor art as obvious, so too is Stew turning the shopping experience on its head. 

    I also remember Stew Sr. touring a large group of PMA members around his original store in 1990 and proudly explaining the Engraving on the Rock, the focus on fresh, and the rationale for not trying to be everything to everybody.  Seems the culture is still alive and well (and standing conventional wisdom on its head).

    Just can see the installation that Bryan refers to here. Take a look ... it is very definition of an Eye-Opener.
    KC's View: