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    Published on: July 25, 2018

    by Kevin Coupe

    I got an email yesterday from an MNB reader, John Baragar, who wanted to bring my attention to a particular story because of the seemingly “daily barrage in the media of bad behavior.”

    The piece ran in the Washington Post, and was about a 20-year-old man named Walter Carr, who lives near Birmingham, Alabama. Carr recently got a job as a mover, and on his first day he was scheduled to report for work at a home 20 miles away from his apartment.

    But Carr’s car broke down. He couldn’t get a ride from friends or borrow a car, nor was there any access to mass transit. So he decided to walk.

    According to the story, “He searched the route from his apartment in Homewood to the house in Pelham, and according to Google Maps, it would take eight hours on foot. As a former high school cross-country runner, he knew he could do it in less.

    “Carr ate a meal of bologna and eggs at 8 p.m. and took a nap. At midnight, he woke up, grabbed his wallet, phone, a baseball and a kitchen knife to protect him from stray dogs. He headed out into the dark … On the trek, Carr had the route mapped out in his mind. He jogged some. He walked a lot. When his legs began to burn, he stayed focused on his goal.”

    He made good time, and by four in the morning he was in Pelham, Alabama, though still hours away from where he was supposed to start work. His legs burning, he decided to sit down in a bank parking lot to rest for a few minutes.

    That’s when a police car pulled up. Carr told the officer what he was doing, the policeman asked when he’d last eaten, and then took Carr out for breakfast, and then drove him as far as he could. Carr got out and started to walk again, but soon was picked up by another cop, who’d been alerted to what Carr was doing. That officer drove Carr to the home where he’d be working, and dropped him off at 6:30 am.

    That policeman told the homeowner, Jenny Lamey, what Carr had done. Lamey offered to feed him and let him take a nap, but Carr demurred ; he just wanted to get to work. Which he did, working with two other movers.

    The next day, the Post writes, “The following day, Lamey called Carr’s supervisor, and the two cried together on the phone about what Carr had done. Lamey posted the story on Facebook, and it took off. She started a GoFundMe with a goal of $2,000 to help him with his car troubles. As of Wednesday morning, it had raised more than $44,000, and a financial adviser had volunteered to help Carr manage the funds.

    “On Sunday, Carr’s boss, Bellhops chief executive Luke Marklin, called to thank him. Marklin said he wanted to meet him in person to show his appreciation. They agreed to meet Monday at a coffee shop near Carr’s apartment. Carr walked the 20 minutes there.

    “When they met, Marklin gave him his own car, a 2014 Ford Escape. He said it would be in better hands with Carr than with him.”

    The moral of the story? According to Carr, “Don’t let nobody tell you you can’t do something. It’s up to us whether we can.”

    Wow. Thanks to John Baragar for sending me this story. He says that he thinks that this happens more often than we know, but just doesn’t get any press coverage. I don’t know about that, but I am thrilled to share it because at the very least, it is an Eye-Opener.
    KC's View:

    Published on: July 25, 2018

    The Idaho Statesman has a story about the newest Albertsons in that company’s fleet, opening this Friday in Boise, with a totally different emphasis than most of the retailer’s units.

    “Instead of an emphasis on canned and boxed goods — although they’re there in abundance — this store focuses on fresh meats and produce; breads, cakes and other bakery items made from scratch; exotic Asian fruits such as dragon fruit and jackfruit; and even hand-crafted chocolates,” the story says.

    John Colgrove, president of Albertsons’ Intermountain Division, says that the store “is everything we talked about and more,” though it may not be for everybody all the time: “If you’re looking for basic items, this might not be the store for you. But if you get excited about food preparation and want to find things that aren’t in every other store, this is the place for you.”

    Other excerpts from the Statesman story:

    • “The $7.2 million building features an upstairs bar, Broadway on the Rocks, the Boise-based grocery chain’s first in Idaho. There are 36 beer taps, half dispensing Idaho-produced beer. Wine is available by the glass, along with mixed alcoholic drinks.”

    • “With seating for 200, customers can also order food tableside. The space includes several TV monitors and roll-up doors that let the air in when it’s nice outside, along with an outside deck that looks north toward Albertsons Stadium on the Boise State University campus.”

    • “The new Albertsons … includes an expansive selection of gourmet cheeses. The store has traditional grocery jobs and others handling nontraditional tasks, such as serving pizzas from a wood-burning oven and catering … The store plans to have local bands entertain customers upstairs, especially on weekends.”

    • “Downstairs includes the pizza oven, a sandwich bar, a stir-fry station, a burger grill and Joe’s fried chicken. A carving station delivers meat cooked and smoked in the store. Another station offers store-made mozzarella cheese.”
    KC's View:
    The Statesman notes that the store originally was supposed to be a Market Street format to differentiate it from Albertsons’ traditional approach, but the decision clearly has been made that it is better to give other Albertsons a goal to aim for.

    Can’t argue with that. The question that folks keep raising with me is the degree to which Albertsons will be able to innovate as its attention increasingly is trained on its acquisition of Rite Aid and the going-public requirements that will follow.

    I don’t have an answer to that, though I certainly concede the point. And it certainly is fair to wonder the degree to which these kinds of innovations will be rolled out, and how they will typify the company’s image and culture in the future. Albertsons is doing a lot right now, like its establishment of an online platform dedicated to O Organics. (I get the feeling that at the moment, COO Jim Donald must feel like this guy.)

    Published on: July 25, 2018

    The Grocery Manufacturers Association (GMA) is out with a new study saying that “out-of-stock rates for online purchases of consumer products in the U.S. are nearly twice as high as in-store availability,” creating lost sales opportunities that may run as high as $17 billion globally.

    However, the study also suggests that online out of stocks do not have the same impact on shoppers as they do in bricks-and-mortar stores.

    According to the study, “The number of items that are available online (OLA) is 80 percent worldwide and 85 percent in the U.S. The 15 percent out-of-stock rate online in the U.S. is nearly double the out-of-stock rate of 8.3 percent for physical stores.

    “Consumer reaction to out-of-stocks are quite different in the online sales compared to stores. U.S. consumers are more likely to remain on the E-commerce site and switch a brand or substitute an item within the brand, which the researchers dubbed ‘the Amazon effect..’ However, if a physical store is out of a product, the consumers are more likely to switch to another store to find the product.
    KC's View:
    When you think about it, this shouldn’t be too much of as surprise, because online retailers have a much greater ability to provide options and alternatives when a specific item isn’t available. It is one of the ways in which online retailers actually are able to provide more personalized service than their bricks-and-mortar brethren … and points to the challenge facing traditional retailers.

    Published on: July 25, 2018

    CNet has a story about how, in the wake of Amazon offering six-quart Instant Pots during its Prime Day promotion for $58, down from the usual $99, Walmart now is offering a different version in the same size for $49.

    And Amazon now is matching the price.

    Eater writes that “Walmart and Amazon have been competing relentlessly, and the retail giants’ battle in the food and grocery space in particular heated up last year when Amazon acquired Whole Foods. Since then, Walmart started a partnership with Miami-based organic restaurant Grown; both companies now sell Blue Apron-style meal kits; and Prime Day saw the two mega-retailers face off with deep grocery discounts.

    “A post-Prime Instant Pot deal is just one more byproduct of Amazon-Walmart’s endless showdown. The deal ends tomorrow, July 25.”
    KC's View:
    The point we’ve been making for what seems like years now is that these two behemoths are going to be engaged in an ongoing and enormous battle, and there’s likely to be a lot of collateral damage. (Like, in this case, anyone else selling the Instant Pot.)

    Published on: July 25, 2018

    The Chicago Sun Times reports that the city’s mayor, Rahm Emanuel, is implementing what is described as “an innovative plan to allow aspiring chefs and new retailers to test their concepts in vacant restaurants and storefronts.”

    The concept is called Pop-Up Permitting, and it hinges on “an ordinance that will allow restaurants and retailers now required to purchase a two-year license to, instead, choose a license as short as five days. City Hall will also offer pop-up licenses for 30, 90, 180 or 365 days.

    “The price will be a bargain, compared to the cost of a two-year license. No on-site inspection will be required. The user license won’t even be tied to a location. That means the license holder can ‘roam’ during the length of the license and operate all around the city.”

    In supporting the concept, Illinois Restaurant Association President Sam Toia says that “young chefs are coming to Chicago because it’s still more cost-effective than to go to San Francisco, New York or even New Orleans. They want to see will their cuisine take off here … Say I’m a young chef who doesn’t really have the capital. If I do a pop-up, then I might get investors because they’ll say, `Wow, this is gonna work’.”
    KC's View:
    I have to say that I love this notion … and it seems to me that it could end up being a way to fertilize a lot of retail and food-oriented innovation. Good for Chicago. Other cities should take note, and do their best to provide a n nurturing environment for small and innovative entrepreneurs.

    Published on: July 25, 2018

    Minerva Insights & Solutions is out with a new study concluding that “the top three keys to survival for retailers are: price, fresh perishables and product availability. According to shoppers, store formats such as Aldi, Trader Joe's and Costco address key US grocery shopper needs the best.”

    The study says that “while there are several other elements impacting store choice and loyalty like fresh perishables and organic options there is no question that Everyday Low Prices model is still the most important factor impacting US shopper store choice decisions … Shoppers rated their five most important factors in shopping as Fresh Perishables, Everyday Low Prices, Convenient Location, In-Stock Products and Wide Assortment. When analyzing impact on overall store satisfaction, other factors came up such as Quick Check-Out, Staff Friendliness & Service, Right Company Values, Store Brands, Promotions, Healthy/Organic Options and High Quality & Gourmet Foods.”
    The Minerva study goes on to say that “in the last 30 days, 50 percent of US shoppers have visited Walmart, however the retailer fails to make it on the top ten list when it comes to overall satisfaction. Another notable absentee in the top ten list was Whole Foods with non-competitive prices the clear culprit.

    “Across all retailers, shoppers say the biggest areas of improvement include price (20 percent), product selection (16 percent), check-outs (7 percent) and product availability (7 percent).”
    KC's View:
    I’m having a little trouble with the conclusion that Aldi and Trader Joe’s are two of the three retailers seen by consumers as best positioned to satisfy their need for price, fresh food and extensive product availability. They are good and distinctive retailers, but those don’t really strike me as their strong suits.

    Published on: July 25, 2018

    The New York Times reports on how “more than 7,000 Nike employees will be getting raises after an internal pay review, undertaken after claims of workplace misconduct and discrimination against women, shook the company and forced out several of its top executives … The company, which is based in Beaverton, Ore., said the changes would affect about 10 percent of its 74,000 employees worldwide.”

    According to the story, “In an internal revolt this year, women at Nike said they were fed up with a company that they accused of tolerating bad behavior and excluding women from its top jobs. At least 11 senior managers have left in the aftermath of an investigation into widespread allegations of harassment and discrimination.

    “Such an overhaul is rare in the corporate world, but the shake-up at Nike has been seen as an illustration of how pressure from employees is forcing even huge companies to quickly address workplace problems.”
    KC's View:
    I bring this up because I wonder how many companies would find themselves with similar results if they did an internal, across the board pay review.

    Published on: July 25, 2018

    Bloomberg reports that Amazon is “well positioned” to disrupt the financial services/asset management industry.

    According to a new analysis from Sanford C. Bernstein & Co., Amazon’s “broad customer base and online platform would give it an edge among big tech companies in asset management, most likely as ‘an arms-length distributor of funds’ rather than as a ‘super-active manager’.”

    The analysis concedes that this is only speculation, and that there is no evidence that Amazon will see this business as ripe for its own disruptive culture. It also notes that such a move would entail risks, especially what could happen “to Amazon’s reputation if investors lost money would be a bigger challenge to overcome.”
    KC's View:

    Published on: July 25, 2018

    Bloomberg reports that Safeway bond investors are claiming “they were robbed of their rights by a 2015 Albertsons Cos. debt deal. Albertsons calls the claim a stale hold-up attempt of the supermarket chain as it seeks to finish taking over Rite Aid Corp.

    “That’s the essence of the dispute between Albertsons and a group of noteholders who claim the company defaulted three years ago, when it overhauled its debt after purchasing Safeway. Both sides fired new broadsides over the past week, with noteholders who own Safeway’s 2031 unsecured debt outlining their position in a July 19 letter asking for a default declaration, and Albertsons giving a detailed rejection today.

    “The arguments are heating up as the $3.1 billion purchase of Rite Aid heads for completion, with a stockholder vote on the merger scheduled by the drugstore chain for Aug. 9. The deal depends in part on Albertsons issuing even more debt to pay for Rite Aid. Albertsons said in a statement to Bloomberg it doesn’t expect any delay, but the timing of the dispute does give pause to some analysts.”

    • The Chicago Tribune reports on how Target is investing “in revamping more than 1,000 of its 1,835 stores by 2020. The Minneapolis-based retailer’s new look caters to customers who are shopping more online but still come to stores for quick-hit trips or to browse and be inspired, said Justin Burns, senior group vice president of Target stores.

    “Burns estimated Target is spending $4 million to $10 million on each remodeled store, a sizable sum when sales are growing faster online than in stores. But the stores aren’t going away: Nearly 95 percent of Target’s sales came from its stores in the most recent quarter. Those stores also filled more than two-thirds of digital orders during those three months, either shipping them to customers or pulling items for pickup … Target is betting that investing in a better store experience — whether that means making it easier for time-crunched online shoppers to grab their items and go or for bricks-and-mortar loyalists to linger and browse — will pay off.”
    KC's View:

    Published on: July 25, 2018

    • Kroger announced that Keith Dailey, who joined the company in 2011 after serving as communications director for Ohio Gov. Ted Strickland, and most recently was Kroger’s senior director of corporate affairs, has been promoted to the role of VP of corporate affairs.
    KC's View:

    Published on: July 25, 2018

    I got the following email from an MNB reader about yesterday’s Eye Opener:

    I find the stories of employees losing their jobs at retail a bit disturbing.

    Why is it when a person makes a mistake, the first response is to fire the individual? To me that can almost be a cop out of sorts.  Sure there are always instance where instant termination is warranted but these 3 instances don’t even come close in my opinion.

    While I agree that what the pharmacist did at the CVS is repulsive, I wonder if it would have served everyone better to educate and yes, discipline the employee to understand that their job is to serve the public, not judge them.  And if the Pharmacist still has a problem with that then they should seek other employment.  Does what the pharmacist do justify ruining their life? 

    Firing makes a statement that CVS does not tolerate the bad behavior but does it do anything to really solve the problem?  How do we get better if we just get rid of the problem instead of solving the core issue?

    How do we make all our employees better instead of afraid?  I’d be more impressed if they had the employee do something to change their attitude or at the very least, make them understand that as a representative of the company, that is not how they should conduct business.

    As far as Burger King goes, while I understand that there were some concerns about food safety, how can a company fire someone plus the manager, for trying to improve customer service?  Maybe she wasn’t dressed in uniform but if she washed her hands, put on gloves and used proper sanitation practices, I don’t think a tank top hurts anyone.  People who have never been on that side of the counter don’t understand the pressure that can be felt when business gets overwhelming.    A bad choice, maybe?  Again, educate them, don’t fire them.  If I were waiting in that line, I would appreciate anyone pitching in to help.

    As a former manager, give me more employees who care like the one who was fired. I’d hire her in a minute.  And really, fire a manager for trying to help customers?  Educate, don’t terminate.

    And Home Depot, really?  Firing a 10 year employee for simply asking a customer to put his dog on a leash?    All dogs should be on a leash in public, you never know what can happen with an animal in a crowd.  It doesn’t sound like he had an opportunity to alert management.  Again, a business firing someone for making what the company feels is a mistake seems like the easy way out.  Plus in this case, I don’t think he did anything wrong.  On top of that if the customer made a racist remark, he was the one who should have been made to leave. I would like to know my managers and company support me in that instance.

    Since when is making a mistake a fireable offense?  How do we get better when we just get rid of the problem instead of addressing why it happened in the first place.    Why isn’t a sincere apology sufficient.   People who work in fear of making mistakes ultimately make mistakes that get themselves fired.
    Businesses that create a culture that does not allow for an occasional mistake run the risk of people not taking any chances to improve.  When did we become a country of no second chances?

    I take your point, and, in fact, I agree with you on two out of three and said so yesterday. I had no problem with the CVS pharmacist being fired, but I’ll accept your suggestion that there may have been a better way to handle it.

    I think your broader point is a good one. Not only do we as a society not give people second chances these days, but we don’t even allow for personal growth … someone does or says something stupid when 18 or 20 or 22, and now they’re losing jobs and becoming pariahs 10 or 20 or 30 years later. This troubles me … and I think it is worth considering in a nuanced fashion.

    Regarding Amazon and Walmart and their ongoing battles, one MNB reader wrote:

    One of the biggest “pain points” for a seller on Amazon is the ratings and reviews.  New companies are sometimes targeted through malicious reviews,  written by alliances / friends of competitors. Despite proving this to AMZ, it is difficult to get these less than honest reviews removed.

    Walmart could help the industry with this enhancement.

    And from MNB reader Tom Carroll:

    I ordered an inside -outside temperature gauge for the house. In my haste I ordered the wrong product. I went online to send it back and there was a notation- not eligible for return. Damn.

    So I called Amazon and asked why I could not return this item. The rep explained why- really not a very good response. Then he said "I see you are a very good Amazon customer and one of our Prime folks so we will issue you a credit to your credit card and thanks for all your business."

    Amazon- what a no brainer.

    Regarding software that keeps popping up ads for products you’ve viewed online, MNB reader Andy Casey wrote:

    The thing that drives me crazy is that once you search for something the ads never stop.  I recently needed a new office chair and like most of the rest of the world started my search at Amazon.  Not finding what I wanted, I moved to Google and finally made the purchase at Staples.  But for the next month, everything (and I mean everything) I did online was accompanied by one or more ads for office chairs.  We need to put a button on those ads, “already bought, leave me alone”.

    MNB reader Jeff Gartner wrote:

    Hey Kevin, you commented with the question "Could we somehow at least have an opt in/opt out feature?" about Amazon extending its Sponsored Products into its advertising marketplace. Perhaps someday that opt in/opt out feature will be connected to a more expensive Prime membership, with Prime enabling you to see fewer or none of these ads.

    PS: I appreciated your comments about the CVS, Burger King and Home Depot employee situations. You were right on with all three.

    From another reader:

    Saw your article about Amazon ads that will retarget based on items you’ve viewed or searched for earlier. I already get these from Google and other online merchants all the time. They appear in my weather app, on FB/IG, in banner ads (the rare times I’m on my laptop), etc. I can’t tell you how many times I’ve completed the purchase on said item but continue to get retargeted on that exact item for weeks afterward. I wish there was a way to opt out and say “I already purchased this” or “even though I looked, I’m not actually interested”. I’d be curious to see how effective this type of customer marketing is. To me, it’s just another advertising medium to ignore.

    And from yet another reader:

    I love Amazon KC, but when I'm scrolling through the app and it has pics of 3 or 4 items I just purchased a day ago but have not received yet, asking if I would like to purchase them again - annoying!

    And about companies that now are including ads for other companies who pay for the privilege when they send boxes to customers, MNB reader Gail Nickel-Kailing wrote:

    What’s old is new again.

    I spent years in the “name and address data hygiene” software industry - those are the people who make software that does things like clean up your mailing address so something you order can accurately be delivered to the right address (in theory). As a result, I worked with lots of catalog companies and public utilities and both had the means to put printed ads and promotions in the boxes or envelopes you received. And some inserted material from other companies. Even utilities experimented with inserting coupons or promos both as separate printed pieces or printed at the end of the bill.

    Certainly helped offset the cost of printing or packaging and mailing/shipping.

    MNB reader Lisa Pawlik wrote:

    I’m a little surprised you’ve never seen ads in the boxes of products you purchase. This isn’t anything new. Even before the internet if you ordered mail order certain retailers would include samples or ads in the boxes you would receive. When I worked in magazine publishing I’d get companies calling all the time offering to co-pack with their packages. Response rates were very low as the problem is these things probably only get seen if the consumer needs to return a product and needs to find the receipt to do so.

    Commenting on Michael Sansolo’s Disneyland-themed column this week, MNB reader Kellee Harris wrote:

    Each year the FPFC hosts a show at Disneyland, and service from booth delivery to room check-in is always first rate. Did you know Disney keeps your name on file and if you let them know in advance you loved the room you stayed in the previous visit (yes, they keep a record!), they will try and get you the same room, even if it was a free upgrade? Amazing! I mentioned this to the check-in clerk and they tried to get me the same room as last year, but when they didn’t have that available, they asked me what I liked about my previous room and booked me into one that had similar features.
    Surprise and delight delivered!

    We reported on Chick-fil-A testing meal kits, prompting one MNB reader to wrote:

    Now die hards can pick up a meal kit on Saturday night and enjoy Chick-fil-A on Sunday! Another problem solved.

    And regarding Tesco’s reported decision to launch a new bargain chain in the UK, one MNB reader wrote:

    Hopefully better than Fresh & Easy!

    KC's View:

    Published on: July 25, 2018

    As often happens at this time of year, I’ve been getting emails from Portland, Oregon-area MNB readers wondering if I am going to have one of those casual get-togethers that we've done here the past few years.

    The answer is yes … and this year, I’m thrilled that it will be sponsored by Portland State University’s Center for Retail Leadership.

    So, let's get together Thursday night, August 2, at 5 pm, at Nel Centro, located at 1408 SW 6th Ave, in Portland. I'll plan on being there for a couple of hours, hopefully on the outside patio - and I hope that any MNB readers who'd like to stop by will do so. Put it on your calendar.
    KC's View: