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    Published on: February 6, 2020

    Digital strategies aren't just about creating alternatives to the bricks-and-mortar shopping experience.  Done effectively, they can actually bring people back to the store, while also eliminating customer anonymity, creating rich and actionable data, and deepen relationships between the store and consumer in a way that transcends the simple transaction.

    Our newest Retail Tomorrow podcast, which brings together a terrific panel of experts from a wide range of disciplines, was recorded at Google’s New York City offices during the recent National Retail Federation (NRF) Show.  Our guests:

    •  Matt Alexander, co-founder of Neighborhood Goods, an unusual and fascinating take on physical retailing with stores in Dallas and New York.

    •  Patrick Flanagan, senior vice president of digital marketing and strategy for Simon,  which has more than 200 properties in 37 states and Puerto Rico.

    •  Tom Furphy, CEO and Managing Director of Consumer Equity Partners, a member of the Retail Tomorrow podcast family and a regular contributor to "The Innovation Conversation" on MNB.

    •  And Jalna Silverstein, a leader in Ernst & Young’s Transaction Advisory Practice and its Real Estate, Consumer Experience and Retail Strategy.

    You can listen to the podcast here.

    This Retail Tomorrow podcast is sponsored by the Global Market Development Center (GMDC).

    Pictured below are our panel members, from left:  The Content Guy, Matt Alexander, Tom Furphy, Patrick Flanagan, Jalna Silverstein.

    Published on: February 6, 2020

    •  Kirk Douglas, one of the last of the great movie stars from Hollywood's post-war golden age, has passed away at age 103.

    The New York Times obit points out that during the 1950s and ’60s, Douglas was "as big a star as there was — a member of a pantheon of leading men, among them Burt Lancaster, Gregory Peck, Steve McQueen and Paul Newman, who rose to fame in the postwar years."

    Among his movies:  Lust for Life, Spartacus, Paths of Glory, The Bad and the Beautiful, Lonely Are The Brave, Champion, Young Man With A Horn, Detective Story, Ace In The Hole, Seven Days In May, In Harm's Way, and Gunfight at the O.K. Corral.

    KC's View:

    I'm guessing that most people under a certain age will have no idea who Kirk Douglas was, or will just know him as Michael Douglas's father.   (People even younger than that may have no idea who Michael Douglas is.)

    But that's a shame, because he was Hollywood's image of the muscular, virile - and sometimes tortured - American for more than two decades.

    He also demonstrated moral courage in real life.  He produced Spartacus, and hired Dalton Trumbo - who had been blacklisted during the shameful McCarthy era - to write the screenplay and insisted that Trumbo's name would be on the credits.  It can be argued that such moves helped to break the blacklist.

    Two small pieces of MNB-centric trivia…

    For Champion, Douglas was trained by a former Light Welterweight champ named Mushy Callahan, who also staged the fight scenes.  Mushy Callahan had a son named Mike Callahan, who was one of the best teachers I ever had when I studied film at Loyola Marymount University.  (Mike had great stories during class about people like Kirk Douglas and Burt Lancaster that always made the subject come alive.)

    And, in the New York Times online obit, there is a picture from Detective Story that shows Douglas with William Bendix and a great character actor named Horace McMahon … who is the father of MNB's own Kate McMahon.

    Published on: February 6, 2020

    •  Forbes reports that "Walgreens Boots Alliance promoted Richard Ashworth, a veteran of the company’s U.S. pharmacy operations, to become President of Walgreens following an operations role he had with the global pharmacy chain."  He will, the company said, be "responsible for developing the strategies and plans for all Walgreens operations and will have full responsibility for the leadership, development and management of the business."

    •  The New York Daily News reports that Bobby Chacko, CEO of Ocean Spray Cranberries, has been fired "amid allegations that he violated the Massachusetts-based company’s policy against harassment."

    James White, who joined the Ocean Spray board of directors as an adviser last June, was named the interim chief executive.

    In a statement, the company said:  "“At Ocean Spray, we have pledged to hold everyone accountable and ensure that every decision is made in the best interest of the cooperative … It should be noted that Bobby Chacko helped to right the ship at Ocean Spray and set us on a new path. However, no matter how valuable someone’s contributions may be, we simply cannot accept a violation of our company policy."

    Published on: February 6, 2020

    •  In Connecticut, the Stamford Advocate reports that "Fairway Market could close its South End grocery and wine store and lay off approximately 150 employees there and shutter other locations if buyers for those sites do not emerge, the bankrupt chain has told state officials.

    "The plan counters a statement that Fairway made when it filed for Chapter 11 protection on Jan. 23, when it said that its stores were staying open and that it did not expect any 'service interruptions' during the bankruptcy proceedings. If the Stamford closing were carried out, it would strip the South End of its only supermarket."

    The story goes on:  "Fairway has agreed to sell for about $70 million its five stores in Manhattan and its product and distribution center in Bronx, N.Y. At the same time, it is 'actively marketing' its 13 other tri-state store locations, including Stamford."

    A closure would happen by the beginning of April.

    •  The Wall Street Journal reports that "the owner of the New York Stock Exchange has made a takeover offer for eBay Inc. that could value the sprawling online marketplace at more than $30 billion … Intercontinental Exchange Inc., known as ICE, has approached eBay in the past and did so again recently … The companies aren’t currently in formal talks, and there is no guarantee eBay would agree to a deal."

    Published on: February 6, 2020

    Commercial Drone Professional reports that Unilever has been testing the delivery of its Ben & Jerry's ice cream cups via drone.

    According to the story, "During the demonstration, a multi-copter drone was fitted with a delivery box designed to carry three Ben & Jerry’s mini cups.  A flight path was set beforehand to allow the drone to carry the ice cream cups inside the Unilever’s US facility"

    While this was just a test, "with regulations around future drone flights expected to become more flexible, the consumer goods company is preparing for a drone logistics service that will deliver products to more customers faster."

    Unilever launched a delivery service called Ice Cream Now in 2017, and sees drones as being the next step in that continuum.

    KC's View:

    My first reaction to this story was, "Really?  Doesn't this seem a little self-indulgent?"

    My second reaction was that this seems totally aimed as those damned self-indulgent millennials.

    My third reaction was … if I didn't have any Graeter's Black Raspberry Chocolate Chip in the freezer (which I almost always do), or their Boldly Bearcat limited edition ice cream (which is our new family favorite), and I knew I could get use an app to get a drone to deliver it pretty quickly without my having to leave the house … well, that seems as fine a use of technology as I can imagine.

    Just sayin'.

    Published on: February 6, 2020

    Barnes & Noble is having to back down from a diversity-oriented project that it hoped would be seen as positive and would improve its tarnished reputation.

    Here's the background…

    The company partnered with Penguin Random House to publish a series of classic novels -  including Lewis Carroll's “Alice's Adventures in Wonderland,” Mary Shelley's “Frankenstein” and L. Frank Baum's “The Wizard of Oz" - for which the covers would portray characters from the books as being dark-skinned.  None of the words would be changed, but the covers were meant to pose a provocative question:  Did you ever consider the ethnicity of the characters in these classic books?

    The thought was that for the most part, ethnicity was never mentioned in the books or factored into characterizations, but the assumption always was made - regardless of the the color of the reader - that they were white.  The new series of covers - marketed as "Diverse Editions" -  were meant to suggest to people of color that these characters could look like them and help them engage with the classic titles.

    To say the least, the effort backfired.

    The criticisms of the series focused on the fact that these novels were not representative of the black experience, and therefore minimized it by trying to suggest that the white experience was universal.  One critic called it “the classics in blackface.”  Others argued that it would have been more powerful and appropriate to republish and promote classic novels by black authors.  And it didn't help that the series was released for Black History Month.

    Barnes & Noble has pulled the books from its shelves and website.

    The company released a statement, saying that the new covers were "not a substitute for black voices or writers of color, whose work and voices deserve to be heard.

    “The booksellers who championed this initiative did so convinced it would help drive engagement with these classic titles … It was a project inspired by our work with schools and was created in part to raise awareness and discussion during Black History Month, in which Barnes & Noble stores nationally will continue to highlight a wide selection of books to celebrate black history and great literature from writers of color.”

    KC's View:

    Obviously, Barnes & Noble miscalculated here.  So did Penguin Random House.

    I have no doubt that their intentions were positive, that they wanted to make classic novels more accessible to children of color.  But it assumed that people cannot relate to characters who don't look like them or live like them.  One of the things that literature - and art in general - can do is give us access to lives and experiences unlike ours.  Our lives and insights are broadened, not narrowed.

    I totally agree that the companies would have been better off making books by black authors more available and accessible, which makes me wonder how many black people were in the room when these decisions were made.  I'm not judging here, because I don't know, but is it possible that this misguided attempt to be more diverse actually reflects a lack of diversity?

    Just asking.

    Published on: February 6, 2020

    Fox Business reports that 7-Eleven has opened its first cashierless-free store, for employees at its Irving, Texas, headquarters.

    According to the story, the Scan & Pay mobile application that drives the system "uses algorithms and 'predictive technology' to separate individual customers' purchases from other customers' purchases. Employees are still necessary for customers who wish to purchase cigarettes, lottery tickets and other products with age limits, according to the release."

    In a prepared statement, 7-Eleven Senior Vice President Mani Suri said that "this in-house, custom-built technology by 7-Eleven engineers is designed for our current and future customers.  Mobile Checkout is just one more way we can make someone's day a little easier and give 7-Eleven customers a convenient checkout alternative to waiting in line during a store's busiest times of day," adding that "introducing new store technology to 7-Eleven employees first has proven to be a very productive way to test and learn before launching to a wider audience."

    KC's View:

    The story equates what 7-Eleven is doing with the Amazon Go checkout-free stores, which may be a bit of a mistake.  There is a difference between having customers scanning and paying as they walk the store, and the checkout-free experience that the Go stores offer.

    That doesn't make the Scan & Pay experience less valuable.  It may end up being the most scalable.  But it doesn't seem to be the same as the more ambitious Amazon effort.


    Published on: February 6, 2020

    Engadget reports that "Instacart employees in the Chicago suburb of Skokie have voted to unionize through their local branch of United Food and Commercial Workers … The move only covers 15 staffers who operate at the Mariano's grocery store, but it's the first time Instacart employees have unionized in the US and could affect issues like turnover rates, work pacing and mysterious employee rating algorithms."

    The move makes the Instacart employees ;part of the United Food and Commercial Workers (UFCW), and theoretically gives them greater negotiating power.  The story makes the point that "only 12,000 of Instacart's 142,000 shoppers are employees capable of unionizing," but that this move could have broader implications, spurring more gig economy employees to consider unionization, which could impact how companies like Instacart operate.

    While Instacart said it will "honor" the vote and "respect[s] our employees' rights to explore unionization," Engadget suggests that Instacart managers visited the Mariano's store to argue against unionization.

    KC's View:

    One of the things that I would be worried about if I were Mariano's - or any other retailer doing business with Instacart - is that this scenario could lead to employee discontent at the delivery company, which could then have an impact on how those employees communicate brand messages to the customers to whom they are making deliveries.

    All this does is potentially create more ways in which retail brands have less control over the way in which they connect to the people who are supposed to be <i>their</i> shoppers.  And Instacart only wants to keep costs down so that it can create a bottom line that will look better to a company looking to acquire it or in a possible IPO.

    Published on: February 6, 2020

    by Kevin Coupe

    There are generations of people who have no idea who Jim Croce was and who never have listened to his music.  Which is a shame.

    I was thinking about this the other day while I was listening to Croce on iTunes:

    You don't tug on Superman's cape

    You don't spit into the wind

    You don't pull the mask off that old Lone Ranger

    And you don't mess around with Jim

    Yahoo Finance has an interview with Scott Moses, head of the grocery & restaurants investment banking practice PJ Solomon (and an MNB fave), who talked about what retailers have to do in order to compete with Amazon.

    "You're never going to beat Walmart on price. You're never going to beat Amazon on convenience. The way that you win is on experience and on trust," he said, adding that "retail is all about customer retention, customer acquisition, and they're [Amazon] making that investment in order to get people to continue to buy."  

    While most retailers (in fact, most countries) don't have the access to investment capital that Amazon does, Moses's argument is that they certainly need to do the things that Amazon cannot or will not do, but that can help them retain and acquire customers.

    The fact is that Amazon hasn't figured everything out.  The story points out that "while online groceries sales from both Amazon Fresh and Whole Foods spiked this quarter, Amazon did not see the same increase from physical sales at Whole Foods, which it bought in 2017. Physical store sales declined slightly from the same quarter a year ago."

    In other words, Amazon does have vulnerabilities.  Or, as we like to say here on MNB, there is no such thing as an unassailable advantage.  That's the Eye-Opener.

    Remember that in the Jim Croce song (spoiler alert!), Jim ends up meeting up in a fight with Willie McCoy, who goes by the name of Slim … and the song ends:

    You don't tug on Superman's cape

    You don't spit into the wind

    You don't pull the mask off that old Lone Ranger

    And you don't mess around with Slim.