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    Published on: October 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.

    I’m reporting this week from the GMDC Retail Tomorrow conference in New York City, where one of the features is a visit to the Time Warner Center in Columbus Circle to look at some of the retail innovations on display here. This continues to be one of the most immersive and effective conferences of its type, and I’m thrilled to be here.

    One of the newer stores in this center is an Amazon Books store up on the third floor, which is sort of interesting since Amazon-owned Whole Foods occupies the entire basement. It is worth noting that a friend of mine, a lifelong New York City resident, points out that while there’s a lot of retail here, real New Yorkers actually hate the place, thinking it seems more typical of Las Vegas or Beverly Hills than of the Big Apple. I must say, I agree with him on that.

    I was talking to my friend about Amazon Books, and he observed that he didn’t like the concept because it seems largely aimed at putting independent bookstores out of business; while he acknowledged that Amazon tends to act out of enlightened self-interest, he said he wishes Amazon would be a little more enlightened about the value of independents in this sector.

    I get his point, but I’m not sure I agree with him on this one. First, just because you are independent doesn’t mean you have a right to survive, nor that you are somehow morally superior to bigger companies. It is a jungle out here, and it is survival of the fittest.

    My friend, wanting to make his point, took me to an independent bookstore in Soho, McNally Jackson. When we got there, I found it to be cozy and crowded, both of which are good signs. However, when he started looking for a copy of Scott Galloway’s “The Four” - the book Tom Furphy and I discussed here yesterday, which I’d recommended - we couldn’t find it. My friend went to the help desk and asked about it, and the very nice young woman behind the counter said they had it, that it was in the business section, and then offered to walk us downstairs to find it.

    Those are all points for the independent.

    However, when we got downstairs, we couldn’t find it until another customer saw the title on the book spine peeking out from among a bunch of other books.

    They lose points on this one - no use having a book if it is hard to find. (Especially since the book came out on Tuesday … it was not like this was a backlist title.)

    I just went into the Amazon Books in the Time Warner Center, and they have one copy left - the rest had sold out - and it was really easy to find because all books in this store are stocked with the cover facing out. They don’t have nearly as many books as the independent, but what they have is highly accessible.

    The other interesting thing about the Amazon Books store is the degree to which it is featuring various technological devices - Kindles, Fire TV, and Alexa-powered speakers - that the company is using to create a smart home footprint, one that it hopes will give it a sustainable advantage long-term. As Amazon becomes more invested in these kinds of technologies, physical facilities become more important.

    The point is, both stores have a role. One is not necessarily better than the other - just different, with advantages worth pressing and defending. But it is is in how they offer compelling experiences - different, but definable - that they offer a compelling bricks-and-mortar alternative to the online experience.

    Which every bricks-and-mortar retailer has to do.

    Or die.

    It’s that simple.

    That’s what’s on my mind this morning, and as always, I want to know what is on your mind.

    KC's View:

    Published on: October 5, 2017

    by Kevin Coupe

    Advertising Age reports on a new ad campaign directly targeting Amazon - though not by name - “ by linking historically fierce competitors such as Walmart, Target, Costco, Walgreens and PetSmart under the banner of Google Express.

    “The ads on YouTube and other social channels, Google's display ad network and Android TV show people grasping for details about what they want to buy. The common solution in the end, driven home by a swirl of eight retailers' logos, is Google Express access to lots of online stores that aren't called Amazon.”

    Google Express serves as a platform for a number of retailers that can offer Amazon Prime-like service without a paid subscription.

    You can watch the ad above … it is probably just an opening salvo in what will be a sustained battle for the consumer.

    KC's View:

    Published on: October 5, 2017

    Bloomberg has a story about how Best Buy is testing a new in-store concept - Assured Living - which sells and installs geriatric care products designed to help folks of a certain age monitor their health and stay safe and comfortable within their homes.

    “Best Buy Co., better known for hawking TVs and computers than for selling geriatric-care products, is wiring it all together,” the story says. “ The electronics retailer, which sells an entry-level package of gear for $389.96 (installation costs an extra $199), also provides a monitoring service for $29 a month.” Currently being tested in Minneapolis and Denver, the concept could be rolled out nationally if it finds a strong reception.

    The retailer is not alone. Bloomberg writes that “Best Buy is one of a number of consumer and tech companies jockeying for position in a race for a likely $50 billion market to remotely look after grandma … Google, Microsoft, and Samsung are all going after the smart-home market with networked gear such as security cameras and thermostats that can be managed by voice controllers or smartphones. Inc. has already introduced a smart-home installation program in several West Coast cities. All of these systems could easily be tailored to keep an eye on the elderly.”

    The demographics are compelling. “Fueling the interest in monitoring aging relatives remotely are some compelling demographics,” Bloomberg writes. “By 2020 about 45 million Americans will be caring for 117 million seniors, spending on everything from food delivery to safety and health monitors. Research by the AARP and consultants Parks Associates found that caregivers will spend an average of $509 annually for each person they tend to by 2021, a 69 percent increase from 2016. That number is only likely to rise … Three out of four caregivers want to use technology to make their duties easier, but only 7 percent have actually done so, according to a 2016 study sponsored by AARP and others.”
    KC's View:
    To me, the most interesting part of this story isn’t the catering to an aging population, though that’s fascinating … more and more companies are going to find that they may be able to get traction by offering products and services to this demographic group. No, to be the really interesting part is the fact that it is services in addition to products … understanding that more and more, they have to reach out beyond the store’s walls if they want to be both relevant and resonant to their shoppers.

    Published on: October 5, 2017

    CNet reports that Walmart has gone live with its offering of more than two million SKUs via the Google Express shopping site and mobile application and through the Google Home smart speaker system and, as an incentive, “will give customers a $25 coupon off a future Walmart order if they buy a Google Home or new Google Home Mini from Walmart when they link their accounts to Google Express.”

    The story notes that “voice shopping is still a new arena in commerce, with few customers testing it out. But, Walmart and Google are hopefully they can team up to build a base in the area before Amazon takes over. Amazon essentially invented the voice shopping market and has a dominant position in the smart speaker market with its Echo family of devices.”
    KC's View:
    Again, Walmart shows itself to be more nimble and adaptable than many of us might have thought it would. This is probably going to be a very small segment for some time, but it makes sense for them to be in the game.

    Published on: October 5, 2017

    The Washington Post reports that European Union authorities have ruled that Amazon must pay $294 million (US) in back taxes to the Luxembourg-based government, following a three-year investigation.

    The Washington Post reports that the case “is the latest in a string of U.S. technology firms to face tax-related penalties in the European Union … According to the European Union, Amazon put ‘the vast majority’ of its profits in a Luxembourg-based holding company, which allowed the company to avoid paying taxes on the bulk of its European profits between 2006 and 2014. Under Luxembourg’s tax laws, Amazon’s holding company - a limited partnership without employees, offices or business activities - was not subject to corporate taxes, which ‘granted a selective economic advantage to Amazon,’ according to European authorities.”

    Amazon reportedly is considering an appeal.
    KC's View:
    Be thankful I don't take it all, ‘Cause I'm the taxman, yeah I'm the taxman… (With a nod to George Harrison…)

    Published on: October 5, 2017

    Got a press release yesterday that said the following:

    Carlisle, PA – GIANT Food Stores and MARTIN’S Food Markets today announced new service commitments to give shoppers the best grocery shopping experience each and every visit. These service promises are part of GIANT/MARTIN’S ongoing focus on helping customers save money, save time and eat well and include improved customer service at both the deli counter and checkout lines.

    “We know our customers are busy so every minute counts when shopping at our stores,” said Tom Lenkevich, GIANT/MARTIN’S president. “We consistently strive to raise the bar on our service. Our new service promises reaffirm our pledge to give our customers an easy and enjoyable shopping experience.”

    GIANT/MARTIN’S has never been more focused on enhanced customer service and satisfaction. New service promises include:

    • Speedy checkout guarantee: If there are four or more separate customers in each available checkout line at any time, the fourth in line customer will get their grocery order for free (a customer is considered fourth in line if there are three other customers in every checkout lane with a cashier).

    • Deli sliced the way you want: When shopping at the deli, customers are offered the first slice of their deli order to check and/or taste. If not, they receive that ordered item for free.

    Some exclusions apply. For more information, please stop by the service center of any store for complete details or visit GIANT or MARTIN’S.

    KC's View:
    Forgive me if I seem snippy here, but … you’ve got to be kidding me.

    If the retailer’s definition of being competitive in the current environment is to get you through the checkouts faster and slice your deli meat the way you want it (and actually give you a taste), they’ve got serious problems. That simply cannot be what passes for innovation in 2017 … the kind of stuff they’re talking about ought to be the bare minimum in terms of what they ought to be offering, not “raise the bar” attributes worthy of a press release.

    This isn’t how you innovate. This is how you write your will.

    Published on: October 5, 2017

    CNBC reports on a new survey that it conducted concluding that “small-business owners who say that Amazon helps drive customers to their business have more confidence than those who say their business competes with Amazon for customers … It's not by a wide margin — 59 percent vs. 56 percent, respectively. And it's also still a relatively small subset of business owners — almost equal proportions of entrepreneurs say their business competes with Amazon for customers (8 percent) or Amazon helps drive customers to their business (7 percent).”

    The CNBC story goes on: “Among small-business owners, there's still a general perception about Amazon that tilts to the negative, even if they say it doesn't flow through to their actual business experience. Forty-two percent of small-business owners say Amazon is bad for small businesses, according to the survey, but a large majority (83 percent) say their business is not affected by Amazon.”
    KC's View:
    Two things here.

    First, the vast majority of the 83 percent of small businesses that say they are not affected by Amazon probably are deluding themselves.

    Second, my friend Tom Furphy always says that you don’t partner with Amazon … you just do business through Amazon. And I’d add that you always have to have a broader strategy.

    Published on: October 5, 2017

    CNBC reports that Amazon is looking for as many as 15 locations in France where it can open bricks-and-mortar stores over the next two years - perhaps to open Amazon Go stores there - and also is open to establishing a partnership with an existing retailer or making an acquisition.

    “According to the report, one of those approached was major French retail chain Monoprix, whose parent company is Groupe Casino. But it indicated that Casino said it ‘does not intend to sell Monoprix’.”

    Amazon has not commented on the report, though it has consistently maintained that it followed the rules; it has, however, changed the way it operates and files tax returns in the EU.
    KC's View:

    Published on: October 5, 2017

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

    • The Arizona Republic reports that Sprouts Farmers Market plans to open “nine stores during the first three months of 2018, including three in Arizona and its first in the northeastern United States … Two of the other stores are in New Mexico, plus one each in California, Florida, Maryland and North Carolina. The Maryland store will be the company's first in the Northeast … The company is planning 30 new stores for all of 2018.”

    Sprouts, which operates more than 280 stores around the country, focuses on offering a value proposition for fresh and organic products.

    No offense, but only folks in Arizona would say that Maryland is in the northeastern US. It actually is a mid-Atlantic state. The Northeastern states generally are considered to be New York, New Jersey, Vermont, Massachusetts, Rhode Island, Maine, Connecticut, New Hampshire, and Pennsylvania, though some would argue that New York, New Jersey and Pennsylvania actually are mid-Atlantic states. But there’s no question about Maryland.

    • The Atlanta Journal-Constitution reports that “fifty-six department and grocery stores have confirmed they will be closed Thanksgiving Day, with most saying they are closing to give employees time off with their families.” The numbers were compiled by

    Among the companies listed as closing on Thanksgiving are BJ’s Wholesale Club, Costco, Publix and Sam’s Club.
    KC's View:

    Published on: October 5, 2017

    …will return.
    KC's View:

    Published on: October 5, 2017

    In the National League Wild Card game, the Arizona Diamondbacks defeated the Colorado Rockies 11-8, and now will move on to play the Los Angeles Dodgers in the NL Divisional Series.
    KC's View: