business news in context, analysis with attitude

Published on: January 2, 2020

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.

First of all, Happy New Year … I trust you had a happy and prosperous holiday season, and that you are embracing 2020 with vigor and ambition for change and disruption. I know I am.

I'm not someone who believes a lot in New Year's resolutions, mostly because I've always found them to be temporary at best and illusory at worst. I sort of feel like I'm kidding myself, making promises to myself that may not be kept, and that really may be an attempt to make myself feel good about the next few days.

But I was reading a couple of stories the other day that prompted me to think that maybe a little resoluting may be in order … at least for businesses trying to figure out how to compete in an increasingly cutthroat environment.

The stories referred to a recent Morning Consult poll about influencer culture:

Some stats:

• "Almost three quarters (72%) of all Gen Z and millennials follow influencers, and teenagers are more likely to follow many."

• "86% of Gen Z and millennials say they are willing to post sponsored content for money. However, money isn't a crucial motivator-61% say they are already likely to organically post about the brands they like."

• "27% claim to know an influencer personally and 12% consider themselves to be influencers."

Yikes.

Now, I have to admit that I've always been a little skeptical, to put it mildly, about influencers. I've generally thought of many, if not most, of them as being people who have figured out how to turn social media savvy into a paying gig without any particular knowledge or passion or experience about anything other than themselves.

(I've been writing MNB for more than 18 years. Does that make me an influencer? I've never thought of myself that way, but maybe I should put it on my business card. It'd make me sound hip. Or at least a little hipper. Then again, the use of a business card might work against that. But I digress…)

There actually were a couple of notes in the survey that grabbed my attention:

• "Being knowledgeable about what they're promoting makes an influencer's followers 56% more likely to buy the product or service they're advertising.

• "Being relatable makes their followers 49% more likely to buy what they're promoting."
So that's something. People are trusting influencers that they consider to be authentic. Though, to be clear, just because you appear authentic doesn't mean you are … to paraphrase George Burns, "If you can fake authenticity, you've got it made."

It seems to me, though, that it might be a worthwhile endeavor for retailers looking to carve out a definable and defensible position in the minds and hearts of their shoppers to create their own influencer initiatives … making it a priority in 2020 not just to sell stuff to people, but to work hard to influence how they think and act and … especially in the food business … eat.

Why not? You have the people, knowledge, expertise, and passion to do so … you probably just haven't thought about the world in this way. And I'm not just talking about social media, though that clearly is important … I'm talking about in the store, and in every interaction with your customers.

The question you and your people need to ask yourselves is not just "what are our shoppers buying?" It also is: "How can we influence them and make their lives better?"

And if you don't have the people, knowledge, expertise, and passion to do so?

Well, if that's the case, there's another George Burns line that might be apropos … "Say goodnight, Gracie."

That's what is on my mind as we start the new year, and as always, I want to hear what is on your mind.

Published on: January 2, 2020

by Kevin Coupe

“Loss is the price we pay for progress,” Robert B. Parker once wrote. “Only as we leave things behind do we move forward.”

I thought of that line - penned by the great Boston-based mystery novelist back in 2010 - while perusing the Boston Globe this week and finding that the No Name Restaurant, an iconic seafood joint in the city's seaport district, has closed.

Unceremoniously. After 102 years in business serving broiled and fried seafood and cold beer to wash it down. Talk about an Eye-Opener.

The story touched my soul a bit, because when I was young (younger?), I'd travel up to Boston for the weekend, visiting my friend Nancy Kelley and often in the company of an old college friend, Herb Loughery, and then later, with Mrs. Content Guy (long before she got that title). The No Name was one of the places we'd go. And I can remember it vividly - no frills, relatively inexpensive (affordable for someone not making very much money), and somehow evocative of a different place and time, and even a little bit exotic for someone like me, inexperienced but hungry to see more of the world and taste its culinary pleasures. (In my family, fried shrimp would've been considered exotic and ethnic. Don't ask.)

According to the Globe, the No Name, while it had improved the ambience over the years, suffered the fate of so many institutions that were unable or unwilling to change with the times.

"Bankruptcy documents show it owed hundreds of thousands of dollars to creditors including the Massachusetts Port Authority, the City of Boston, and several seafood companies," the Globe writes. "What’s more, the No Name stopped paying property taxes in 2013, and Boston has put a lien on the property. No Name owes the city close to $700,000 in back taxes including interest, according to city records … The establishment filed for Chapter 7 bankruptcy, which provides for the liquidation of property and the distribution of assets to creditors. Staffers learned of their looming unemployment only 24 hours prior, during a management meeting Sunday night."

While the Globe doesn't get into it, the closure strikes me as perhaps inevitable. The city's Seaport District has undergone enormous change and redevelopment since the dawning of the 21st century. Office buildings, hotels, restaurants and the city's new convention center have sprung from the earth; it is where companies such as GE and Reebok decided to relocate their corporate headquarters and where, if you can find it, it would cost you several million dollars to buy a two-bedroom apartment.

Boston.com also makes the point that, for better or worse, "the Seaport’s rapidly changing landscape in the past few years has seen the proliferation of chains (FuKu, Pink Taco, Shake Shack), as well as the recent arrival of Woods Hill Pier 4, which replaced the historic Anthony’s Pier 4; Trillium Fort Point, an expansion of the popular local brewery; and Flight Club, the second U.S. location of a whimsical, technology-driven darts bar."

In other words, a long way from the rougher, working waterfront that so many of us remember our youths, into which the No Name seemed to fit so organically.

The funny thing is, I get to Boston a couple of times a year, and it may speak volumes that I hadn't thought about the No Name in a long time. If I'm down by the waterfront, the more adventurous offerings at Legal Test Kitchen are more my taste. And there are plenty of other places in Boston and Cambridge that I'd think about for a drink or a meal.

To some degree, maybe that's what happened to the No Name. Out of sight, out of mind, out of options.

I was curious about something, and so I did a quick Google check; I wondered how close to Legal Test Kitchen the No Name happened to be.

Two-tenths of a mile. Go figure. So close, and yet…

I'll raise a glass to the No Name next time I'm in Boston. I may even stroll by to see what has taken its place. And I'll think back to when I was young, and a cold beer and some fried shrimp and some sea air with friends was exotic and pleasing and lovely.

And if the memories have been touched up by time and age, that's okay. Because as Robert B. Parker also wrote, in another place and at another time, "Illusion is nearly all we have."

Published on: January 2, 2020

CNBC has a story about how Walmart CEO Doug McMillon is taking uncharacteristically "bolder" moves than in the past, "leading the company as it takes major policy stances on issues such as e-cigarettes, wage hikes and gun sales."

In the latter case, the company's move came after a pair of deadly shootings at two of its stores, promoting it to "halt sales of ammunition for assault-style rifles and handguns and … begin asking shoppers to no longer openly carry firearms in stores in states where 'open carry' is allowed." McMillon said at the time that he was responding to the concerns of people both inside and outside the company, and that "it's clear to us that the status quo is unacceptable."

Now, McMillon has become "chairman of the Business Roundtable, months after the CEO trade group said that shareholder value should no longer be the primary goal of a corporation and that it should instead take into account all stakeholders including employees. The statement marked a major philosophical shift in how the group views corporate governance and drew criticism from some major investors."

There could be an upside to the job, CNBC suggests: "McMillon’s new gig could help boost Walmart’s reputation, especially with younger employees and shoppers looking to buy products from companies whose values are aligned with their own."

Published on: January 2, 2020

The Cincinnati Business Courier reports on how Kroger "is always working to identify the next big thing, if it’s not catching up to what others are already trying." Here's what the Courier says is on its list for 2020:

Kroger, the company says, has to continue to make progress on its Ocado initiative, which will have it opening "20 of the robotics-operated warehouse and distribution centers around the country," with the goal of making it "faster, cheaper and more efficient to delivery groceries to customers’ homes or get them ready for pickup." But there is much work to be done - only five locations have been publicly identified, and the first one doesn't open until next year. Meaning 2021.

The story also suggests that Kroger has to continue to work on all its various delivery initiatives, which is "the hot-button issue every supermarket operator is striving to improve. Customer convenience is vital, and Amazon.com has such a headstart in delivering products to customers’ homes that everyone else is playing catch-up."

In addition, the Courier writes, Kroger has to make progress in fresh food sales (where it has an advantage over Amazon that it must work to maintain) … same-store sales growth (with which many analysts seem to be satisfied at the moment) … and online sales (where it will become increasingly difficult to achieve the big growth numbers of the past).

Published on: January 2, 2020

The Wall Street Journal and the New York Times were just two of the publications this week that did stories detailing some of the technology changes that consumers and businesses are likely to encounter in the coming year … and most their predictions match up.

From the Journal, there is a prediction that we're likely to see broader adoption of 5G technology, especially as "some of the 5G kinks will get worked out, plus the marketing blitz will hit even harder." There's also the suggestion that wearable technology will continue to expand, especially "advanced wireless earbuds (that) have built-in sensors and voice-assistant capabilities: They’re becoming more like their own hardware platforms, letting you do everything from hearing your messages read aloud to ordering a car. By the end of 2020, more than one-third of the U.S. population will use a hearable, according to a recent eMarketer report."

There's also a suggestion from the Journal that we're likely to see a new iPhone that potentially could rock the marketplace … and continued growth of the streaming culture that has so many content companies competing against each other for product and eyeballs. And, there is the suspicion that 2020 could be the year that Amazon faces real legislative and regulatory resistance, especially since it has foes on both ends of the political spectrum willing to challenge its ubiquity and influence.

The Times argues that the integration and expansion of smart home technologies are likely to hit the fast track in the coming year … especially since one of the stories of late 2019 concerned how "Amazon, Apple and Google came to what appeared to be a truce: They announced that they were working together on a standard to help make smart home products compatible with one another. In other words, when you buy an internet-connected light bulb down the line that works with Alexa, it should also work with Siri and Google Assistant. This should help reduce confusion when shopping for home products and improve the ease with which connected gadgets work with one another."

But when it comes to 5G expansion … more streaming wars … and more wearables, the Times seems to be pretty much in agreement with the Journal predictions.

Published on: January 2, 2020

ABC News writes about new labeling rules from the Food and Drug Administration (FDA) that have gone into effect, requiring packages to have "two side-by-side columns: one with nutritional information for a single serving, and a second with information for eating the entire package."

The story notes that "manufacturers that yield less than $10 million in annual food sales will have until 2021 to comply with the new rules."

Other changes on the label, the story notes, include "enlarged and emboldened calorie information on the new labels" and a requirement "to disclose added sugars on labels."

Published on: January 2, 2020

The Associated Press reports that Sears is selling its DieHard car battery brand, which has been identified with the retailer since its creation in 1967, as it tries to raise cash that can be applied to its survival efforts.

Advance Auto Parts is buying the DieHard brand for $200 million.

According to the story, "Sears will still be able to sell DieHard goods in its stores. And it will still be able to create products for the brand as long as they are not auto-related, like the DieHard boots it currently sells. Advance Auto Parts said it will sell DieHard auto batteries in its more than 4,800 stores and plans to expand it into batteries for other types of vehicles."

Published on: January 2, 2020

• From Bloomberg: "Amazon.com Inc.’s stock had the biggest advance on the S&P 500 Index after the e-commerce giant said its holiday season this year was 'record breaking,' with billions of items shipped and 'tens of millions' of Amazon devices like the Echo Dot sold.

"Five million new customers started Prime free trials or paid memberships globally, while the number of items that were delivered with one-day or same-day shipping quadrupled compared to last holiday season. Independent third-party sellers, meanwhile, sold more than a billion items, Amazon said."


• From Reuters: "Britain's competition regulator is launching an in-depth investigation into Amazon.com Inc's purchase of a stake in online food delivery group Deliveroo after the companies failed to assuage its initial concerns.

"Amazon led a $575 million (439 million pounds) fundraising by Deliveroo in May and the probe could disrupt the e-commerce giant's efforts to compete with Uber Eats, Just Eat and Takeaway.com in food delivery.

"The Competition and Markets Authority (CMA), which launched an initial probe in June, said on Friday it had decided to move to a 'Phase 2' investigation as Amazon and Deliveroo had not addressed its concerns before a Dec. 18 deadline … The deal would give Amazon more say in the running of Deliveroo, which has grown rapidly in the last six years to more than 100 towns and cities across Britain."

Published on: January 2, 2020

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

• From the New York Times: "Holiday sales rose 3.4 percent this year over 2018, according to a survey by Mastercard SpendingPulse. Online sales grew much more sharply — 18.8 percent — marking the continuing change in how people shop.

"The increase this year, both over all and online, is smaller than it was in 2018, but the findings will be welcomed by retailers, which depend on year-end splurges to drive their annual sales."


• Axios reports that the US Food and Drug Administration (FDA) has "officially raised the age to buy tobacco in the U.S. from 18 to 21 … the decision comes faster than some expected as the FDA had six months to amend their policies after Trump signed the bill and another 90 days to officially adopt the change. 19 states and the District of Columbia had already put in place laws to raise the minimum buying age for tobacco products — including cigarettes, cigars and e-cigarettes — to 21."

The National Association of Convenience Stores (NACS) said this week that it has "organized a joint retail association letter to the FDA explaining the complexities of the transition for retailers who must retrain employees, update signage, reprogram POS systems and inform customers. In the letter, the organizations asked the agency to clarify that it will not enforce the new federal age until it issues implementing regulations in 2020. The FDA has indicated to NACS that the agency will issue a statement soon on the transition.

I feel bad for the retailers that find themselves staring down the barrel of a law the implementation of which seems precipitous, and I trust that regulators will have a little compassion about enforcing these mandates in the short term.


• The Wall Street Journal reports that the "Food and Drug Administration plans to ban the sale of fruity flavors in cartridge-based e-cigarettes, but the restriction won’t apply to tank vaping systems commonly found at vape shops, according to people familiar with the matter.

"The action is seen as a compromise between Trump administration officials who want to address a rise in teen vaping and those concerned about the impact on small businesses and the possible political fallout for President Trump, these people said. Polls commissioned by the vaping industry have shown an outright ban would be unpopular in key states for the 2020 election.

"Federal officials are expected to announce the new plan as soon as Friday."

No sympathy here for the manufacturers of this poison, which, to my way of thinking, cannot be pulled off the market fast enough.

Published on: January 2, 2020

• The Wall Street Journal reports that craft store chain Michael's has hired Ashley Buchanan, described as a "rising star at Walmart," to be its new president/CEO.

Buchanan most recently was Walmart's chief merchandising and chief operating officer for its U.S. e-commerce business.


• BJ's Wholesale Club announced that its president, Lee Delaney, will become the company's CEOm effective February 2. At that time, current chairman/CEO Christopher Baldwin will take on the role of executive chairman.

Published on: January 2, 2020

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

• The Associated Press reports this morning on the passing yesterday of Don Larsen, the New York Yankee pitcher who threw the only perfect game in World Series history against the Brooklyn Dodgers in 1956. Larsen was 90, and died of died of esophageal cancer.

The AP story notes that Larsen was a journeyman pitcher at best; he played for nine different teams and "was 81-91 lifetime, never won more than 11 games in a season and finished an unsightly 3-21 with Baltimore in 1954, the year before he was dealt to the Yankees as part of an 18-player trade." He was traded by the Yankees to the Kansas City Athletics after the 1959 season - a deal that brought Roger Maris to New York.

The night before bis perfect game, Larsen was out on the town, never expecting to pitch; his first start in the series, in Game 2, ended in the second inning. But "when he reached Yankee Stadium on the morning of Oct. 8, he found a baseball in his shoe, the signal from manager Casey Stengel that he would start Game 5." The rest is history, proving that even historically unremarkable performers can do amazing things if they are in the right place at the right time.


• David Stern, who became commissioner of the National Basketball Association (NBA) in 1984 and guided the league through a period of unparalleled global and economic growth, passed away yesterday at age 77. The cause was a brain hemorrhage he suffered three weeks ago.

In its obituary, Sports Illustrated wrote: "Under Stern, the NBA went from dozens of employees to thousands, from domestic to global, from secondary sport to multi-billion dollar entertainment. His tenure was marked by the rise of Larry, Magic and Michael, of Kobe and Shaq, of LeBron and Dirk, and the fact that you recognize each of these athletes by first name is partly Stern’s doing. He understood the power of brands, the value of self-expression, and the lure of personality.

"Forever ahead of the curve, Stern read Ad Age and Mediaweek back when his peers were reading the sports section. He oversaw the creation of All-Star Weekend, the inception of the draft lottery, the first Dream Team, and, later, the D League and the WNBA. He was an early champion of cable, the internet, and international expansion. His gift was to see not just around the first corner, but two or three."


• Don Imus, the "shock jock" who went from disreputability to politically influential during a 50-year storied radio career that eventually crashed and burned when he referred in 2007 to the Rutgers University women’s basketball team, which was competing in the NCAA championships, first as “rough girls” and then as “nappy-headed hoes," has passed away. He was 79, and while no cause of death was announced, he had suffered in recent years from both prostate cancer and emphysema.

Imus had retired in 2018 from radio, and at the time I wrote here I was shocked because it was the classic case of a tree falling in the forest and no one hearing or much caring.

At the time, I wrote, in part:

"Imus, who helped to invent the 'shock jock' genre, first in Cleveland and then in New York, reinvented himself in the late eighties when he moved his show to WFAN in New York, the nation’s first all-sports station. The show began being syndicated all over the country. Then, in 1996, he began simulcasting his show on MSNBC, and for a decade was a high-profile place for politicians from both sides of the aisle as well as prominent journalists and athletes, to appear to talk about issues in a more relaxed context. His interviews often created headlines, because he asked questions that few others would think to ask. Imus used his celebrity to raise millions for a variety of charities, with a special focus on children with cancer, wounded veterans, and autism research. And, he even launched, with his wife, a line of environmentally 'green' cleansers.

"It all came crashing down in April 2007 when he referred to the Rutgers University women’s basketball team, which was competing in the NCAA championships, first as 'rough girls' and then as 'nappy-headed hoes.' The comment generated outrage about what was then portrayed as a pattern of racism and sexism, but Imus was slow to apologize and realize that he’d put his career and business at risk. Most of the prominent people who appeared regularly on the show were no longer willing to do so - he was toxic.

"MSNBC dropped his show. (It was replaced by 'Morning Joe.') So did WFAN. And after a period of exile, Imus returned … with a lower profile, less prominent guest list and smaller syndication value. Later controversies garnered less attention, I think, because fewer people cared … There was a time when watching or listening to “Imus in the Morning: was a regular part of my day, usually on in the background while I wrote MNB.

"In 2007, though, I decided that there were better ways to go. Thus, in 2018, when the tree fell in the forest, I didn’t hear it, and I didn’t much care."

I concluded: "The Eye-Opening business lesson, it seems to me, is that no matter how secure your competitive position may be, one has to assume that it all is temporary and maybe even illusory. In fact, it seems to me that the right way to approach the conduct of business is to assume that it can all end tomorrow. It keep you sharp. It keeps you connected."

I'll stand by that judgement. There is way too much toxicity in the public discourse, and for my money, you can judge a civilization by its ability to tell the difference between legitimate satire and virulent attitudes that poison a culture.

Published on: January 2, 2020

…will return.