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: August 3, 2016

    by Kate McMahon

    At a recent New York Yankees home game, those of us over the age of 30 were lamenting the demise of the printed game ticket/souvenir of the day, replaced by a mobile app e-ticket.

    So when I looked up at the signage circling the outfield, I was struck by the one thing that hadn’t changed – the bright yellow logo for Nathan’s Famous, the iconic hot dog maker celebrating its 100th birthday this year.

    The secret to Nathan’s success? Its authenticity, and savvy marketing chutzpah for the past 10 decades. The product hasn’t changed since an impoverished Polish immigrant named Nathan Handwerker hawked his dogs on Coney Island and undersold his former employer, Feltman’s, by a nickel. Handwerker charged 5-cents per hot dog, even though he lost money on each sale. After only two years he boldly renamed his street-corner stand “Nathan’s Famous,” where it continues to sell franks, crinkle fries and onion rings 365 days a year. He finally raised his price to 7-cents in 1944.

    Today, Nathan’s operates 45,000 restaurants, retails its hot dogs in 50,000 stores in all 50 states, and sold 480 million franks last year. Its Fourth of July Hot Dog Eating Contest is televised live nationally.

    Two books published this centennial year by members of the family’s third generation detail Handwerker’s strategy: He and his wife Ida created the 100 percent beef hot dog using a secret spice recipe created by Ida’s grandmother. Handwerker hired college students to pose as doctors from Coney Island Hospital to prove even then that his products were “healthy,” and made his stand a must photo opportunity for political candidates. He believed in hype, and the hot dog eating contest launched in 1972 was the like perfect topping on the frank.

    There are several lessons to be gleaned from Nathan’s longevity, I think.

    Its core business remains the frankfurter – 100 percent all Angus beef, not a turkey or chicken dog to be found in its lineup. Its condiments are the originals – mustards and barbecue sauce, no ketchup – and pickles. The same holds true for its frozen fries and onion rings, and appetizer line, which essentially consists of franks in a blanket, bagel dogs and mini-franks. Rather than be distracted by the flavor-of-the-month trends, Nathan’s has made the most of its franks and the word “original” on almost every label.

    Nathan’s has always celebrated its Coney Island roots, giving it a personality that a Hebrew National or Sabretts dog can’t match. And while the logo hasn’t changed, the company’s social media presence is active and forward thinking.

    The best combination of old and new is Nathan’s multi-activation campaign Ticket to Fun, a virtual, interactive 3-D Coney Island launched this summer for the 100th celebration. With one-click, anyone can experience the Brooklyn amusement district of yesteryear, featuring the Cyclone and Wonder Wheel rides, the fortune teller Zoltar, and of course the original Nathan’s on the corner of Surf and Stillwell Avenues.

    For the folks at today’s Nathan’s, introducing and/or reinforcing the brand's traditional Coney Island street credibility has been and remains the key to success - understanding that the best and most enduring brands stand for something. It is a lesson for every brand, I think.

    "Authentic" can't just be a slogan or an adjective.

    Comments? As always, send them to me at kate@morningnewsbeat.com .
    KC's View:

    Published on: August 3, 2016

    by Kevin Coupe

    Add Target to the list of companies investing in connected household products - in this case, by opening Connected Nursery sections in some 450 of its stores, selling internet-enabled baby products that make parents’ lives easier and offer peace of mind.

    The products included in the offering are air quality monitors, ear thermometers, a patch that tracks babies' breathing rates and sleep positions, and even a rubber ducky - all connected to the internet to keep parents intimately informed about infant well-being.

    This is not Target's first foray into the connected appliance business - it has been testing a "Open House" connected home concept to varying degrees in Minneapolis and San Francisco, with plans to slowly expand the concept.

    At the same time, there are a variety of companies testing the notion of appliance connectivity - linking everything from crockpots to refrigerators and ovens - allowing consumers to monitor and control their lives remotely.

    There will be some who will hear about such products and wonder if they are a bridge too far, if they represent an effort by people to try to extend control over their environments to an almost unreasonable extent. And I must confess that I was one of those people in the beginning, but i've had people (including a couple of my students at Portland State University this summer) explain to me how such a thing as an internet-enabled slow cooker made their lives just a little easier, allowing them time to do things more important. And I think that the idea of a connected baby nursery makes an enormous amount of sense ... because when it comes to a baby's safety, I'm not sure there is such a thing as overreach.

    I think this is just the beginning of where this technology is going. And it is an Eye-Opener.
    KC's View:

    Published on: August 3, 2016

    The Richmond Times-Dispatch reports that in that Virginia city, where competition is getting tougher with the moves into the market by Wegmans and Publix, Kroger and Walmart are both using e-commerce as one of the ways to differentiate themselves.

    According to the story, "Kroger locally started offering its ClickList service on a limited basis in March, and the service is now available at seven of the 18 area Kroger stores. Plans are to expand to four more stores by the end of the year. Plans also call to add the service at selected Kroger stores in the Charlottesville, Roanoke and Hampton Roads markets."

    And, "Walmart’s online ordering service, called Walmart Grocery, rolled out locally in April and is available at four of the chain’s 20 Walmart Supercenter or Walmart Neighborhood Market locations in the area. Walmart Grocery pickup also is offered at 10 stores in Hampton Roads."

    The story goes on to say that "online grocery ordering currently accounts for a fraction — estimated to be 3 to 6 percent — of the estimated $675 billion U.S. grocery sales market.
    But the trend is up, driven in part by tech-savvy millennials who are accustomed to using technology to simplify everything from finding a date for Saturday night to looking for a job to arranging a ride to the airport.

    "A January report from Morgan Stanley Research, which looked at the global reach of online grocery shopping, estimated the percentage of online shoppers buying groceries to go from 21 percent in 2015 to 34 percent in 2016."
    KC's View:
    To me, one of the things that is changing about the e-grocery environment is that it no longer can just be a defensive play by retailers not really committed to it, but fearful that not making at least a minimal investment in it will leave them vulnerable to e-competition.

    I think retailers need to not just make a real commitment to the technology, but also view it in a progressive and aggressive way. It is about opportunity, not defense. It is about creating a robust and nuanced customer experience that is linked seamlessly to the bricks-and-mortar store.

    And I think companies that don't see it in this way are making a potentially enormous mistake.

    Published on: August 3, 2016

    bfresh, the Ahold Delhaize-owned, fresh food-oriented urban format, said that it will open its newest store in Brighton, Massachusetts, on August 19, and that the new store will feature both an expanded grocery selection and more grab and go options.

    This will turn bfresh into a two-store division, but it is, of course, not the second store opened by the company. The second store was in suburban Fairfield, Connecticut, but was closed after traffic and sales proved to be disappointing.
    KC's View:
    It may seem counter-intuitive, but I actually saw the Fairfield closing as a positive development for bfresh ... it showed that the company was willing to fail fast and fail forward ... it learned something important about the format's relevance to different markets ... and it cut its losses and moved on. Those are all important things for companies to do ... as Jimmy Buffett sings, you have to "breathe in, breathe out, move on..."

    I'm also interested to see how the bfresh experiment plays out now that the Ahold-Delhaize merger has been completed. Does management see this as an approach to be emulated - creating a series of skunkworks that can try new things, develop new concepts and offerings, and looks for new ways to be relevant to a changing consumer? Because bfresh seems to me to be about effectiveness, not just efficiency ... and that's where Ahold Delhaize has to go.

    Published on: August 3, 2016

    The New York Times reports that specialty food store Eataly will open a second New York City location shortly, in the World Trade Center complex downtown. The company believes that downtown customers will have different needs than the midtown Flatiron District customers served by the original New York location; for example, the new Eataly at 4 World Trade Center will offer breakfast, a first for the company.

    The new store will feature "a casual restaurant called Orto e Mare (Garden and Sea), with a counter where granola, smoked salmon, pancakes, frittatas and other egg dishes will be served," the Times writes. "Later in the day, it will shift to vegetable and fish dishes. Breakfast sandwiches will be available at the panini bar.

    "Other firsts at this Eataly include a salad bar, a gastronomia for prepared food, and La Piadina, where traditional flatbread sandwiches will be made to order. Most of the dining options will be in a separate area with many windows, and will include Rossopomodoro for pizza, a wine bar and a restaurant, Osteria della Pace ... As in the other Eatalys across the globe, there will be aisles stocked with Italian goods, including fresh and cured meats, seafood, cheeses, produce, grocery items, condiments, homemade mozzarella, pastas and gelato."

    Dubai, in the United Arab Emirates, is said to be the only other city that is home to two Eataly stores. The first New York store reportedly had five million visitors last year.

    There currently are 27 Eataly stores around the world, with 16 in Italy and, until now, just two in the US. The other US unit is in Chicago, and there are openings scheduled for Boston and Los Angeles.
    KC's View:

    Published on: August 3, 2016

    Dunkin' Donuts announced that it is expanding its Dunkin' Delivery service to New York City - or at least to certain neighborhoods in Manhattan and Brooklyn. To this point, Dunkin' Donuts has been available only in Atlanta, Boston, Chicago, Dallas, Los Angeles and Washington, D.C.

    According to the company, "Dunkin' Delivery will be offered through on-demand delivery service DoorDash, making it even easier and more convenient for people to run on Dunkin' from morning to night ... residents can use the DoorDash app or website to order their favorite Dunkin' Donuts products ... delivery is available from 7:00 a.m. – 11:30 p.m. Sunday through Thursday, and until 2:00 a.m. Friday and Saturday nights." Delivery is promised within 45 minutes, and DoorDash has said it charges $5.99 per delivery, with no minimum.
    KC's View:
    I assume that Dunkin' Donuts must be finding this to be a viable enterprise if it is expanding it. I'm not sure I'd ever use it ... and for the record, I'd probably not order Starbucks to be delivered, either. But I suppose that in certain markets, under specific circumstances, it makes sense ... unless, of course, this is just a defensive play against Starbucks and it doesn't really matter much whether people are using it now.

    Published on: August 3, 2016

    TechCrunch reports that San Francisco-based cooperative grocery store Rainbow Grocery is using Selfycart, described as "a self-checkout startup" that helps customers avoid waiting on line at the store.

    According to the story, customers "can use the Selfycart app to scan your items, pay for the items and then leave the store without needing to wait in a line or interact with anyone, unless you want to. Before leaving the store, an associate can check your QR code to confirm that you paid."

    The story goes on to say that "Selfycart’s business model entails an annual subscription of $19,800, paid in monthly installments, to use its platform and access its analytics dashboard. For shoppers, they pay 2 percent per transaction, but Selfycart will remove it if it turns out to deter app adoption."
    KC's View:

    Published on: August 3, 2016

    GeekWire reports that Amazon, which has been growing its private label groceries offering, "is now selling nuts and trail mix under the Happy Belly brand, its private label for perishables ... The e-commerce giant began rolling out private-label food products in June, starting with Happy Belly coffee and Mama Bear baby food."

    The story notes that it is "advantageous for Amazon to produce items in-house, as control over marketing, development, and packaging typically results in higher margins for the retailer."
    KC's View:

    Published on: August 3, 2016

    • Hy-Vee announced that Jeremy Gosch, the company's senior vice president and chief merchandising officer, has been promoted to the role of executive vice president for strategy, while remaining as chief merchandising officer. And, the company said, Donna Tweeten, senior vice president and chief marketing officer, has been named executive vice president/chief marketing officer.
    KC's View:

    Published on: August 3, 2016

    ...will return.
    KC's View: