retail news in context, analysis with attitude

Published on: January 5, 2017

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.

One of the nicest things that happened over the holidays in my town was the opening, over New Year's weekend, of a new Shake Shack. Now I love it for lots of reasons - I'm a big fan of Danny Meyer, the restaurateur whose company launched this still relatively small chain of burger joints; I love the burgers and especially the new chicken sandwich; they serve craft beer; and now they have an app that allows me to order in advance, choose a pickup time, pay for the order and just show up and skip all the lines. And, I can walk to Shake Shack from my house and my office.

But the business lesson has to be more than it is important to keep the Content Guy happy.

The fact is that this space was occupied until recently by a Chuck's Steakhouse, which had a vibe that seemed like it was right out of the fifties. And not in a retro way. Just in an old way. In fact, the salad bar often looked like it was offering vegetables that were harvested in the fifties. Which is pretty amazing, since it actually was opened in 1968.

in other words, Chuck's was a steakhouse that was way, way past its prime. (Pun intended.)

Now, there are some here in town who argued against the opening of Shake Shack, saying that Chuck's was a kind of landmark that deserved to stay in business. And even when Shake Shack opened, people could be heard saying that they missed Chuck's. I suspect that many of the folks who said that actually liked the idea of Chuck's more than the restaurant itself, and that they probably didn't go there very much. And their comments ignored the fact that Chuck's didn't sell the real estate because business was cooking.

(To be fair, this is not a town that would ever be described as progressive. It is the town that was featured in the film Gentleman's Agreement, and while things have moved forward a little bit, there still are a lot of people here who think the town should look just like it did when Eisenhower was president.)

To me, the change from Chuck's to Shake Shack is a business lesson. Because when a business - any business - is past it its prime, it is because that business has made a choice.

When companies drift into irrelevance and mediocrity, the word "drift" only describes the pace of change...or rather, lack of pace of change. It is because the people in charge have made a choice not to wake up each morning like their hair is on fire, not to face each day by saying, "what are we going to do today to make sure we are as relevant and vibrant as we possibly can be."

Chuck's is gone now, and from my perspective, good riddance. But the folks at Shake Shack have to understand that if their restaurant is the same ten years from now as it is today, they will probably be going down the same road as Chuck's. They can't make that mistake. They can't breathe their own exhaust or rest on their laurels. They have to compete every day, and compete is a verb.

My daughter, by the way, had a really smart observation about this Shake Shack - that its proximity to I-95 should not allow management to believe they don't have to worry as much about return customers because so many people are in transit. They have to be vigilant about maintaining community support and repeat business - because that becomes the foundation upon which a sustainable business is built.

My sense is that they'll probably be really smart about this. When I went in the other day, I was greeted by a fellow named Jerry - who not only managed a local Baskin-Robbins for years, but also was a popular umpire of local Little League games. It seemed like most of the people who walked through the front door knew Jerry, and were excited to see him. That's a good move on Shake Shack's part.

It is like a line from the great Vin Scully that I am adopting as my personal mantra for 2017. I am going to keep it in mind every morning as I write MNB, and so much so that I've constructed a new presentation around it:

Good is not good when better is expected.

The opening of Shake Shack is a great for our town. Whether it continues to be a great - serving great food, and offering terrific service - is entirely up to them.

As it is up to each of us in our own businesses.

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

Published on: January 5, 2017

by Kevin Coupe

Fascinating story from Marketplace on National Public Radio (NPR) about a Philadelphia automobile repair shop with a twist - it has been designed to appeal to women, and offers salon services as well as oil changes. Now, one can get a mani/pedi while getting a brake job.

Girls Auto Clinic was started by Patrice Banks, who is described as "wearing a backwards red ball cap, skinny jeans and high-heel boots." She said that she was inspired by auto repair shops where guys condescended to her ... she got tired of it, and decided there was a niche that needed to be filled.

The story quotes Denny Bowen, president of the National Automotive Maintenance & Repair Association, as saying that "women represent about 65 percent of auto repair customers. He knows of other female-owned shops, but hasn’t heard of any that focus on one demographic."

It all starts with one ... and it is an Eye-Opener.

Published on: January 5, 2017

The Wall Street Journal reports this morning that Amazon plans to open its first Amazon Books store in New York City, in Manhattan's Time Warner Center at Columbus Circle.

The 4,000 square foot store is slated to open this spring. The shopping complex also is home to a flagship Whole Foods store.

The story notes that there currently are three Amazon Books locations - in Seattle, Portland, Oregon, and San Diego. Additional units reportedly are on the drawing board for Brooklyn, Chicago, and Dedham, Massachusetts.

Published on: January 5, 2017

The Wall Street Journal reports that Macy's said yesterday that sagging holiday sales - down more than two percent compared to a year earlier - have forced it to eliminate "more than 10,000 jobs as part of a continuing plan to cut costs and close 100 stores."

According to the story, "The announcement on Wednesday continued a trend for Macy’s, which announced last January that it was eliminating about 4,500 jobs in a major restructuring. Then, too, it said slumping holiday season sales had hurt its bottom line. The company, which now has 730 stores, announced in August that it would close 100 of them. On Wednesday, it identified 68 stores to be closed."

Published on: January 5, 2017

AdWeek reports that L'Oreal-owned Kérastase has "announced a new brush dubbed Hair Coach that collects and analyzes grooming patterns to recommend the right products and techniques."

That's right. It is a smart, connected hairbrush.

Here's how AdWeek describes it:

"Each brush contains a tiny microphone that records the sound of brushing to detect if hair is dry, frizzy or prone to breaking. Built-in sensors then determine if someone is brushing hair when it's dry or wet while a gyroscope and accelerometer count the average number of brush strokes and measure the force used to brush hair.

"The styling tool uses Wi-Fi and Bluetooth technology to deliver all of that data to the app. The app then breaks down beauty habits using algorithms developed by L'Oreal to show consumers a chart of their routines and give tips on improving the health of their hair. For example, someone brushing too hard might get a message recommending softer strokes. Or the app may suggest that consumers brush more if the amount of strokes is too low.

"Each user is also given a score between one and 100 that assesses the quality of their hair. In addition to the data collected from the brush, the app also pulls in local weather information to recommend Kérastase products. Consumers can then click the product recommendation links and shop from Kérastase's website.
No specific price has been set for the brush, but it is expected to be under $200.

Published on: January 5, 2017

Forbes reports that Amazon is scheduled to lose its patent protection on its 1-Click ordering system later this year, which could open the door for other online stores to adapt the technology.

According to the story, "Amazon first applied for a patent on 1-Click in 1997, and it was granted in 1999. The core of the proposition is that by storing your payment and address details you only need to click a single button to order something. This means that there are fewer steps to ordering, which is less time-consuming and what is termed 'frictionless'."

Published on: January 5, 2017

• ABC News reports that Kroger has expanded its ClickList click-and-collect service, now making it available from five stores in the Toledo, Ohio, market.

“The evolution of ClickList has been fast paced,” says Bill Green, VP of Operations for Kroger’s Columbus Division. “Kroger launched the service just six months ago here in central Ohio, and since then, we have continued to expand its functionality. The addition of same day service is in direct response to customer demand, and we are confident it will live up to their expectations.”

Published on: January 5, 2017

Amazon announced this morning that "Prime members can voice-order their next meal through Amazon Restaurants on their Alexa-enabled devices including the Amazon Echo and Echo Dot. The new Alexa skill allows customers to reorder from any restaurant available on the service in more than 20 cities by saying, 'Alexa, order from Amazon Restaurants," and have any meal they've ordered before delivered to their door for free in an hour or less.

The announcement says that "Amazon Restaurants is available in Atlanta, Austin, Baltimore, Brooklyn, Chicago, Columbus, Dallas, Houston, Los Angeles, Phoenix, Portland, Manhattan, Miami, Minneapolis, Northern Virginia, Orlando, San Diego, San Francisco Bay area, Seattle, and Tampa."

And, it goes on: "Once an order is placed, Amazon delivery partners deliver the food in one hour or less. Amazon Restaurants offers customers transparent pricing--there are no menu markups or hidden service fees--and delivery on all orders is free for Prime members. If a customer finds a restaurant item on Amazon Restaurants that is priced higher than the regularly priced item on the restaurant's current online menu within 24 hours of placing the order, Amazon will refund that customer the price of the item."

Published on: January 5, 2017

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

• In Memphis, the Commercial Appeal reports that Kroger has begun offering "crowlers" - 23 ounce fillable cans that essentially are the aluminum version of beer growlers - at a new midtown store. The crowlers, which are filled from 12 different taps, are part of a test from Kroger to determine consumer appeal.

Big fan of crowlers ... and, in fact, I did a piece last year about the first supermarket in the country to offer them - the excellent Green Zebra store in Portland, Oregon. You can see that piece here.


• The Orlando Sentinel reports that Winn-Dixie, which has been losing sales and market share in recent years, "won't give up on its 16-month-old low-price strategy, even with heat from cost-cutting competitors."

CEO Ian McLeod says that the company believes that by stressing low prices, Winn-Dixie will be able to generate more sales, which will compensate for the lower margins.

The story notes that "the Central Florida grocery market has grown increasingly crowded in the last year from growth by discount brand Aldi and niche stores such as Lucky's Market. Lucky's focuses on low-priced organic and fresh produce, meats and bulk foods. Other competitors are adding convenience, such as drive-through pickup lanes at some Wal-Mart and doorstep delivery from Amazon Prime Now."


• Whole Foods said this week that it plans to begin exclusively selling DVD copies of At The Fork, an animal welfare documentary that "examines the complex world of animal agriculture, including many of the challenges and opportunities that exist within the current system."

The Los Angeles Times review of At The Fork said that it "serves up an even-handed perspective on the subject of eating ethically," while the Hollywood Reporter said that it "turns out to be significantly more than a polemic against carnivorism."

The movie also is available for streaming via iTunes and Amazon.


• Business Insider reports that Amazon and Forever 21 are said to be "among the companies weighing offers to acquire bankrupt American Apparel, people familiar with the talks said on Wednesday. The bankruptcy auction of Los Angeles-based American Apparel, which made its branding theme 'Made in the U.S.A,' will determine the future of a major clothing manufacturing plant in California, one of the most expensive U.S. states in terms of labor costs.

The story notes that "Forever 21, founded by Korean-American Do Won Chang, is known for its low retail prices, helped by lower labor costs abroad;" investing in a California factory could help the company in a political climate where keeping jobs in the US is a high priority of the incoming administration.

As for Amazon, "acquisition of American Apparel would be a major push for the e-commerce company into branded fashion and apparel. The Seattle-based company began to launch private label brands last year."

Buying a clothing brand/factory would strike me as a push for Amazon. But nothing would surprise me, and it is possible that such an investment could serve a broader strategic vision.

Published on: January 5, 2017

• Ahold Delhaize announced yesterday that it has named Roger Wheeler to be the president of Retail Business Services, described as "an independent Ahold Delhaize company that provides support services to Ahold USA and Delhaize America local brands."

Wheeler previously was the US lead for the company's Integration Management Office, where he helped to coordinate the merger between Ahold USA and Delhaize America in the US.

Published on: January 5, 2017

Got the following email from MNB reader Mari Johnson about our story regarding the growth of email-driven sales during the holidays:

Email marketing was noticeably excessive and extremely annoying! Caused me to unsubscribe from many retail emails...overwhelming! Many of the unsubscribe links aren't working or they have an extremely long delay before you are removed....very frustrating!



MNB reader Tony Bartys had some thoughts about our story looking at Starbucks' plans for AI baristas:

As a regular Starbuck’s customer, who still likes to go into the store to order, I am noticing that between the three different ways to place an order, i.e., drive-through, walk-in, and mobile, it is getting difficult for many stores to handle the volume of orders and customers are giving up and walking out or not getting into the drive-through lane because of increasingly long waits.

Additionally, those people that placed the order through their phone and thought that there would be little to no wait are expressing frustration and pressing the baristas for their orders. The box, and in most cases, the parking lots are too small for the volume of business that is occurring, especially during peak times. You might say it’s a nice problem to have, but there are alternatives.

I would suspect that Starbucks is aware of this, since it is a smart retailer, but it is expensive and difficult to carve out more space from the small foot print that most Starbucks occupy. It will be interesting to see how it handles the situation going forward.




We had a story yesterday about the 37-year-old Spokane man who was banned from a local Starbucks after he hit on a 16-year-old female barista. The man has gone on Facebook to complain of ageism in his treatment, saying, "I know the female Starbucks barista was of legal age to date. I broke no laws. I merely took a chance with my heart. I’m tired of hearing the word ‘creep’ as any black person or gay person is tired of hearing certain words. I have a whole webpage dedicated to age gap love."

I commented, in part:

Sixteen may be "legal," but it also means she could've been a high school sophomore - and she ought to be able to work a part-time job without some creep who is more than two decades older hitting on her.

He's lucky it wasn't my daughter. Because my inclination would've been to deal with him myself the next day. (I have a baseball bat that I keep around the house for just such purposes.)

He doesn't want to be called a creep? Then he should stop acting like one.

MNB user Christ Utz wrote:

As the father of a lovely young daughter; I was upset when I read about this self-absorbed jerk, complaining about his rights.  Your view reinforced my gut reaction of how to deal with that clown; best to let the police handle it though…

From another reader:

We’ve had to ban customers from our stores over the years for exactly this behavior. Luckily, for them, no police were involved. Our 300 lb., 6 ft. plus operations manager simply talks to them. He has daughters - he knows what to say. A creep is a creep.

And from another:

Being the father of 2 daughters (and a son who was brought up knowing how to treat women), I can identify with the baseball bat.  I used that as well as my nail gun as emphasis a couple of times while my daughters were growing up.

An engaged Father is sometimes all you need to get things straightened out.

MNB reader Rob Howard:

You crack me up Kevin...I needed a good chuckle this morning.  I have a daughter as well, and those are my exact sentiments- although I don't think I would have the kahunas to write it out such as you did.  Nicely said!

But MNB reader Ben Kuzma thought I was being hyperbolic:

Unless you’re using inflammatory language to intentionally get “fan mail” you’re starting to sound like Trump.

First of all, I don't have to use inflammatory language to generate email. I get hundreds of emails from readers every week. (Though, to be fair, I wouldn't characterize all of it as "fan" mail. A percentage of it could be described as "you're an idiot" mail.)

Second, I reject the comparison. I was talking about using the threat of a baseball bat to defend my daughter's honor from a creep ... which I think most fathers would do. 

In the end, by the way, I think that Starbucks and the barista probably handled this appropriately - swiftly and legally. I also think that anyone with a teenaged daughter living anywhere near this creep in Spokane ought to be on high alert.