retail news in context, analysis with attitude

MNB Archive Search

Please Note: Some MNB articles contain special formatting characters, and may cause your search to produce fewer results than expected.

    Published on: June 6, 2016

    by Kevin Coupe

    Last week, sportswriter-turned-broadcaster Tony Kornheiser announced that he would end his daily radio program broadcasted in Washington, DC, later this month and launch a new podcast in the fall.

    This is intriguing beyond the obvious point that someone of note is moving from traditional media to new media.

    It is important to understand the context. Kornheiser began his career as a sportswriter, first for Newsday, then for the New York Times and then for the Washington Post, where he forged a long career as an outspoken and sometimes provocative columnist. He's pretty much given up writing, turning his attention to broadcasting - as co-host, with Michael Wilbon, of "Pardon the Interruption" on ESPN, and as host of his eponymous radio program, which has run on several stations in DC.

    A major part of Kornheiser's schtick is his image as a grumpy old guy who doesn't "get" modern technology; he has long referred to the personal computer as "the Google machine," and iPods seem to be beyond his comprehension. But even in doing so, he has marveled on the air about the popularity of the podcast version of his radio show, which has earned him listeners around the world who send him tribute, compose theme songs and generally worship him as "the littles." (Count both Michael Sansolo and me as big, big fans.)

    But the idea that he would abandon his traditional radio program and his declared love of "local radio" for a podcast? Fascinating ... and an indicator of where the world is going, away from traditional institutions and embracing new constructs. Which is what we all have to do in our businesses (and out lives, for that matter).

    I'll be interested to see how the economics of it all work, where the sponsorship money comes from and how the content changes, if at all, to reflect the broadened audience and new venue. In part, my interest is related to the fact that I am occasionally urged by MNB readers to turn the site into a podcast. I'm not sure that the time is right for that - yet - but I am intrigued by the possibility.

    FYI ... Sansolo and I generally spend about 30 minutes on the phone each day expounding on business, culture, politics, and assorted other topics ... we've often wondered if there would be an audience for those conversations, and the Kornheiser show has been a reference point. I should point out that our families will ask why we're talking when we should be working ... but our argument is that this, in part, is how we work out ideas for stories and columns and speeches and maybe even future books.

    Count me in when the new Kornheiser show comes to the internet in September. it won't just be music for the ears ... it'll be an Eye-Opener.

    And one final note ... if you're out on your bike tonight, do wear white.
    KC's View:

    Published on: June 6, 2016

    Lots of coverage of Walmart's annual meeting in Arkansas on Friday, and here are a couple of the highlights ...

    • The Associated Press reports that Walmart CEO Doug McMillon "urged employees ... to reimagine its future in a fast-shifting retail landscape ... We want to make every day easier for busy families. We're connecting all the parts of Wal-Mart into one seamless shopping experience with great stores, easy pickup, fast delivery and apps and websites that are simple to use."

    The story notes that "Wal-Mart emphasized ways in which it's working to be more nimble.
    The company is spending money on its stores and its staff. It's in the second year of a $2.7 billion investment in training and higher wages, with the goal of making Wal-Mart a place people want to be."

    However, while Walmart's financial performance has improved and stands out in comparison to that of other retailers, the AP writes that "red flags have appeared have as Wal-Mart digs in to fend off Amazon.com. Overall revenue in the fiscal year ended in January declined slightly to $478.6 billion, excluding revenue from membership fees and other income. That's the first annual drop since the company went public 45 years ago." And, "Wal-Mart's e-commerce growth has slowed dramatically even as it escalates investment there. Global e-commerce sales growth slowed to 7 percent during the first quarter, a notable downturn from nearly 30 percent two years ago."

    Walmart is responding to these challenges, the AP, by putting more of an emphasis on price, "sprucing up stores," and dramatically expanding online options, including more grocery availability, a greater number of pickup sites, and a test of delivery via Deliv, Uber and Lyft.


    • The New York Times has a story about how while Walmart workers "have something to cheer about" since average hourly pay has gone up since "Walmart announced early last year that it would increase wages to at least $10 an hour for its army of part-time and full-time workers."

    But ... "employees more critical of the company say Walmart — the biggest private employer in the United States — has found more subtle ways to keep the reins on its workers’ paychecks. The retailer has cut merit raises, for example, and has introduced a new training program that can keep employees at $9 an hour for as long as 18 months.

    "The moves have concerned worker advocates, who say the changes have chipped away at the earnings gains employees appeared to make last year."

    Meanwhile, the Times quotes Kathleen McLaughlin, Walmart's chief sustainability officer, as saying that the company wants “as many people as possible” to advance to $10 through the program: "Opportunities for personal growth, good communication with a supervisor and a chance to advance in one’s career were among the most important reasons for training, she said. 'The research actually shows that wage is not a big driver of motivation,' she said."


    The Street reports that Walmart's Sam's Club division plans to test an office supplies delivery business, though it did not say when or where. However, the company did make clear that federal regulators' successful blocking of an acquisition of Office Depot by Staples - which would have consolidated their B2B efforts, something that antitrust officials found unacceptable - has given it a potential opening.
    KC's View:
    In the broadest sense, the stories about Walmart's annual meeting suggest to me two things - the extent to which Walmart executives are trying to change the culture to make the company more appropriate to 21st century realities, and the degree to which they have a long way to go in dealing with existing conceptions/preconceptions/misconceptions about the company.

    The thing is, Walmart is fighting battles on a number of fronts ... because as it tries to upgrade its various operations to compete with Amazon and Trader Joe's and Whole Foods' new 365 format on one side, it also has to fight a rearguard action against Aldi while preparing for Lidl and hoping that Save-A-Lot isn't successful at rebuilding its business. And that doesn't even take into account Kroger's continuing success.

    Published on: June 6, 2016

    The Los Angeles Times has a piece by self-described "Middle-Class White Millennial" Devon Maloney, who says that he was drawn to shop at Whole Foods new "365" format store there because "our food needs are as unique as we are, and it’s pretty absurd that, until now, we’ve been forced to stock our refrigerators in stores designed for old people." (I think it is fair to say that Maloney writes with tongue firmly in cheek.)

    "365 is not just about appealing to millennials through our wallets," Maloney writes. "It’s about capturing our hearts, too, by revolutionizing the food-buying experience...somehow? Anyway, this flashy gimmick certainly isn’t here to profit from an already-gentrified, upwardly mobile yuppie community and help drive up rent prices for low-income immigrant families who have been here for decades!"

    Good piece ....and you can read it here.
    KC's View:

    Published on: June 6, 2016

    Re/code reports that Amazon founder/CEO Jef Bezos said at a technology conference last week that "Amazon was committing to 'intelligent' voice assistant devices in a big way," and has more than 1,000 people working on what he called the "Alexa and Echo ecosystem."

    What exists today, Bezos said, is "just the tip of the iceberg."

    "By flicking at the broader 'ecosystem' of apps and services that Amazon wants to support through its Echo, Bezos is making explicit what the next stage of the competition for Echo will look like," Re/code writes. "The race is on for these companies to not only build functional devices, but to add the cross-device apps and services that will differentiate them to customers."

    The story goes on to note that "Google introduced its own Amazon Echo competitor, Google Home, at I/O last month, in addition to its own voice-powered software ecosystem. And in a week and a half, Apple is reportedly going to announce that it's opening up Siri to outside developers (the company is also said to be working on its own Echo-like device)."
    KC's View:
    And so, a new battle is joined, on a new battlefield. I'm fascinated ... and so is Kate McMahon, who will be reporting on her own Echo experiences in her column on Wednesday.

    Published on: June 6, 2016

    Business Insider reports that "as noted by a Cantor Fitzgerald note on Thursday, Amazon blows away all of its competitors in time spent on their mobile websites by a long shot. Mobile visitors spent an average of 103 minutes on Amazon compared to Target's 20 minutes and Walmart's 14 minutes.

    "On top of that, Amazon's mobile service is proving to be sticky, causing customers to return six times a month, compared to 2.5 times for Walmart and two times for Target, according to the note. Other retailers, like Macy's, Nordstrom, and even smaller e-commerce sites like Etsy, hovered around two-time to three-time repeat customers, it said."
    KC's View:

    Published on: June 6, 2016

    Fast Company has a story about a new study by marketing agency Enso, looking into brands ranked by "perceived purpose," or "the extent to which they stand for something other than making money."

    Those "best brands" are, in order: Goodwill, Amazon, Google, Kellogg's, Paypal, Disney, Girl Scouts of America, Kraft, Johnson & Johnson, and Dove.

    The "worst brands" are Marlboro, Monsanto, Red Bull, Goldman Sachs, Lululemon, Miller Lite, Salesforce, Airbnb, Audi, and Heineken.

    One interesting note: "The survey shows that millennials and generation Z have significantly different impressions of companies than older groups. For example, they rank Twitter and Uber respectively 58 and 42 places above their main ranking. At the same time, they rank old-line giants like IBM, Procter & Gamble and Hewlett-Packard substantially lower than do older people.
    KC's View:

    Published on: June 6, 2016

    • Andy Clarke, CEO of Walmart-owned Asda Group in the UK, said over the weekend that he will eventually be replaced by Roger Burnley - who hasn't even joined Asda yet as COO. Burnley was rival J. Sainsbury's director of retail and operations when he was named COO of Asda last October, but he won't begin at Asda for another four months.

    Bloomberg quotes current Asda CEP Clarke as saying that he "wanted to find somebody who had the ability to be my successor. It took us some time to find the right person, the right cultural fit, the right sort of character and leader that can run the business." The story also notes that Asda's poor recent performance has been criticized by David Cheesewright, CEO of Walmart’s international unit, as being "very disappointing."
    KC's View:

    Published on: June 6, 2016

    Muhammad Ali, born Cassius Clay, who was perhaps the greatest boxer in history, not to mention being one of the most controversial and most-loved athletes of his time, passed away Friday at age 74.

    Ali had battled Parkinson's disease since 1984, and he died from septic shock after being diagnosed with a respiratory illness.

    Two suggestions.

    First, check out David Remnick's piece about Ali in The New Yorker, in which he writes that Ali "became arguably the most famous person on the planet, known as a supreme athlete, an uncanny blend of power, improvisation, and velocity; a master of rhyming prediction and derision; an exemplar and symbol of racial pride; a fighter, a draft resister, an acolyte, a preacher, a separatist, an integrationist, a comedian, an actor, a dancer, a butterfly, a bee, a figure of immense courage." You can read it here.

    Then, buy or download a copy of Remnick's excellent biography of Ali, "King of the World: Muhammad Ali and the Rise of an American Hero," which is one of the best books of its kind that I've ever read. You can find it here, as well, I'm sure, in many local independent bookstores.
    KC's View:

    Published on: June 6, 2016

    ...will return.
    KC's View:

    Published on: June 6, 2016

    Novak Djokovic defeated Andy Murray 3-6, 6-1, 6-2, 6-4 in finals on Sunday to win the French Open men's singles championship, becoming the first male player in almost 50 years to win four consecutive major championships. Djokovic now has just two championships to go - Wimbledon and the US Open - to win a calendar-year Grand Slam.

    Meanwhile, on Saturday, Garbine Muguruza upset Serena Williams 7-5 6-4 in the women's singles finals of the French Open to earn the first major championship of her career.
    KC's View: