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    Published on: October 6, 2020

    This weekly series of Retail Tomorrow podcasts features Sterling Hawkins, co-CEO and co-founder of CART-The Center for Advancing Retail & Technology, and MNB "Content Guy" Kevin Coupe teaming up to speculate, prognosticate, and formulate visions of what tomorrow's retail landscape will look like post-coronavirus.

    There is another pandemic affecting many retailers - a competitive pandemic that for years left many complacent or paralyzed, unable or unwilling to innovate to the degree necessary to survive.  But then, when the coronavirus pandemic arrived, the acceleration of certain kinds of consumer behavior forced retailers to innovate on the run … though they didn't necessary think of it as innovating.  They just thought of it as the bare necessity for subsistence.

    Today, in the second part of a two-part conversation, Gary Hawkins - who with his son Sterling Hawkins founded and runs CART - talks about how to implement the building blocks necessary to achieve Retail 4.0 relevance - connected to consumers, contextual to their behavior, and reflecting imbedded cultural values of organizations and their leadership.  The inevitable reality is that retailing is be dramatically remade.  What remains to be seen is how many businesses will adapt and thrive.

    You can listen to the podcast here…

    …or on The Retail Tomorrow website, iTunes or Google Play.

    Note:  You can listen to part one here or here.

    Published on: October 6, 2020

    by Kevin Coupe

    There was a story this morning in the Financial Times that struck me as offering a good metaphor for retailers.

    The piece was about how music streaming services like Spotify are getting into the podcasting business. 

    "Staking its flag in the ground," FT writes, Spotify "committed to spending $500m to make itself the biggest in the podcasting business, a title long held by Apple.  Once a nerdy niche industry populated by talk radio hosts, podcasting has become something everyone wants to get into, with big tech companies and record labels pouring hundreds of millions into landing the next big audio show."

    The story goes on:  "Apple and Amazon have also taken notice. Apple bought ScoutFM, a podcast 'curation' app, and is reportedly looking to produce its own original podcasts. Amazon in September added podcasts to its music services, promoting popular shows such as Planet Money and Radiolab."

    While it remains early days, FT suggests that the reason for this shift in strategy is easy to understand.  When streaming music, Spotify and its brethren essentially are selling product that everybody has access to via a multitude of services.  But in developing podcasting platforms and signing talent, they can develop proprietary, exclusive content that will differentiate them.

    Like I said, a great metaphor for retailers.

    At most food retailers, the vast majority of items sold also are available at the bricks-and-mortar and online competition - sometimes at the same or a similar price.

    It is critical for retailers to identify, implement, and promote proprietary and exclusive products and services that are not being offered by the competition.

    Do so, and you have an Eye-Opener.

    Ignore the challenge, and you're moving forward with your eyes closed, if indeed you are moving forward at all.

    Published on: October 6, 2020

    Ocado Group, the British online grocer that has been licensing out its robotic warehouse technology and partnering with other retailers - notably, in the US, Kroger - is being sued for patent infringement.

    Norway-based AutoStore Technology, according to Bloomberg, is saying that "its warehouse system is at the base of the British online grocer’s technology, and is seeking to block its expansion in the U.S. and U.K."  Redress is being sought in both UK and US courts, the story says, adding, "The dispute between the two parties isn’t new, and Ocado has previously denied AutoStore’s accusations of patent infringement. The British company says that its automated warehousing system has unique hardware and software. It has filed more than 40 patents for its system."

    According to the story, "The complaint comes as Ocado pushes to expand its model into new markets. The company earlier this week briefly overtook Tesco Plc as the U.K.’s most valuable retailer when its market capitalization reached 21.6 billion pounds ($28 billion). Much of that value comes from its place as a technology company and its potential to roll out automated warehousing systems and software to retailers globally."

    Ocado says it has not yet received official notification of the suit, and said it has not infringed on anyone's patents.

    “We have multiple patents protecting the use of our systems in grocery and we are investigating whether Autostore has, or intends to, infringe those patents,” Ocado said in an emailed statement. “We will always vigorously protect our intellectual property.”

    KC's View:

    One surefire prediction:  The lawyers are going to get rich on this one.

    Published on: October 6, 2020

    The Wall Street Journal reports this morning that "food makers including Campbell Soup Co. and Kellogg Co. said huge demand during the coronavirus pandemic has taught them to focus on bolstering supplies of their most popular products.

    "Big food companies are working to increase their output and protect workers as the virus continues to spread, representing an opportunity for elevated sales to persist but also a risk to operations if the public-health crisis hurts their own productivity … Heading into the winter, retailers are stockpiling staple foods to prepare for potential jumps in demand. Grocery demand has moderated since the spring, allowing manufacturers to catch up with production. They are also investing in automation to reduce exposure to workers that can lead to plant closures."

    One of the things that manufacturers have to be careful about, the story says, is making sure that their employees stay healthy, lest they have a problem keeping their factories staffed and production lines moving.

    In the case of Campbell, the company is hiring "even more workers than it might need at one time, in an effort to compensate for employees who need to rest given heavy workloads or are out sick or quarantining."  Kellogg is "sending home information to workers to encourage them to stay safe when they leave their facilities, including as the winter approaches and holiday travel is expected to begin."

    KC's View:

    Beyond the heightened sales and the opportunity for more as the weather gets colder and the infection numbers potentially get higher, it is interesting that Kellogg sees the moment as a time to bring some consumers home to products with which they have lost touch over the years.  We all know the cold cereal has been a cold category for a number of years, but at moments like these, it also can be a kind of comfort food.

    That's happening on a broader level with so-called "big food" products, as companies viewed with suspicion in some quarters because of their size now are seen as dependable and reassuring precisely because of their size.

    Published on: October 6, 2020

    Bloomberg has a story about how RobinFood, a tech startup in Bogota, Colombia, has developed what it views as a restaurant chain suitable for the post-pandemic era, "with diners having almost no contact with staff as digital orders for meals costing a few dollars are delivered or picked up from a modern automat."

    The story goes on:  "RobinFood plans to expand from 50 stores to 1,000 (that’s 1,900% growth) over the next five years, which would make it one of the largest chains in the region. A key to the model is that each location will make food for as many as four of the firm’s seven brands - spanning rice bowls, burgers and pizza slices - in what’s often called a 'cloud kitchen' concept, according to Jose Guillermo Calderon, chief executive officer and co-founder."

    KC's View:

    The key words there are "modern automat," in the sense that this does seem to be an updated, technologically powered version of the Horn & Hardart version on East 42nd Street and Third Avenue that my Aunt Mae and Uncle Bill took me to back in the late fifties.

    It is intriguing to think about how an old concept like an automat could be combined with new technology - like touchscreen and mobile ordering - and a fresh approach to restaurants like ghost kitchens to create a new format that will serve consumers.

    Published on: October 6, 2020

    Washington Post columnist Steven Pearlstein has an excellent piece today with the following starting point - how last summer, "the nation’s most respected business organization, the Business Roundtable, issued a statement repudiating shareholder primacy and declaring that companies needed to balance their obligation to serve shareholders with obligations to other stakeholders, including customers, employees, suppliers and the communities in which they operate."

    Pear stein notes that member companies have been criticized for giving the new priorities mere lip service, but he argues persuasively that it was a statement of intent, not achievement, and that shifting from a shareholder model to a stakeholder model is a time-intensive proposition.

    He also makes the point, equally persuasively, that the most important part of the statement was how it looked to free companies from the straitjacket of shareholder capitalism, but that it would be foolish to exchange one straitjacket for another.

    Excellent, nuanced piece … and you can read it here.

    Published on: October 6, 2020

    Random and illustrative stories about the global pandemic and how businesses and various business sectors are trying to recover from it, with brief, occasional, italicized and sometimes gratuitous commentary…

    •  In the United States, we now have had 7,679,908 confirmed cases of the Covid-19 coronavirus, resulting in 215,039 deaths and 4,895,291 reported recoveries.

    Globally, there have been 35,736,102 confirmed coronavirus cases, 1,046,546 fatalities and 26,894,740 reported recoveries.

    •  The Wall Street Journal reports that "the  U.S. reported fewer than 40,000 new coronavirus cases for the first time in a week, as President Trump returned to the White House from the hospital and another member of his staff tested positive for the virus.

    "The 35,504 cases reported Sunday - lower than the initially reported figure of 38,630 - constitute the lowest daily increase since last Monday, when the U.S. reported 33,312 new cases, according to data compiled by Johns Hopkins University. Case counts often dip after the weekend before rising midweek."

    However, the Journal writes, "California reported more than 3,000 new cases Sunday, and Texas reported more than 2,700, according to data compiled by Johns Hopkins. Eleven other states, including Illinois, Indiana, Wisconsin and Minnesota recorded more than 1,000 new infections apiece … In 31 states, the seven-day average of new cases was higher than the 14-day average, an indication cases in those states are rising, according to a Wall Street Journal analysis of Johns Hopkins data. A week earlier, that figure was 34 states."

    •  From the Washington Post:

    "The Centers for Disease Control and Prevention acknowledged Monday that people can sometimes be infected with the coronavirus through airborne transmission, especially in enclosed spaces with inadequate ventilation.

    "The long-awaited update to the agency web page explaining how the virus spreads represents an official acknowledgment of growing evidence that under certain conditions, people farther than six feet apart can become infected by tiny droplets and particles that float in the air for minutes and hours, and that they play a role in the pandemic."

    •  From the New York Times this morning:

    "Nearly a third of hospitalized Covid-19 patients experienced some type of altered mental function — ranging from confusion to delirium to unresponsiveness — in the largest study to date of neurological symptoms among coronavirus patients in an American hospital system.

    "And patients with altered mental function had significantly worse medical outcomes, according to the study, published on Monday in Annals of Clinical and Translational Neurology.

    The story goes on:  "These patients stayed three times as long in the hospital as patients without altered mental function.

    "After they were discharged, only 32 percent of the patients with altered mental function were able to handle routine daily activities like cooking and paying bills, said Dr. Igor Koralnik, the senior author of the study and chief of neuro-infectious disease and global neurology at Northwestern Medicine. In contrast, 89 percent of patients without altered mental function were able to manage such activities without assistance.

    "Patients with altered mental function — the medical term is encephalopathy — were also nearly seven times as likely to die as those who did not have that type of problem."

    •  CNN reports that White House press secretary Kayleigh McEnany, as well as two of her deputies, have tested positive for the Covid-19 coronavirus, joining a list of White House aides and elected officials who have tested positive over the past week.

    •  From the Wall Street Journal, this assessment of how the pandemic has affected the retail sector:

    "The coronavirus pandemic accelerated a major shift in the retail industry. Traffic to stores evaporated. Online credit-card transactions soared. E-commerce sales in the second quarter rose by 44.5% compared with the same period in 2019 and they now make up 16% of all U.S. retail sales, according to the Commerce Department."

    Even as lockdown restrictions were lifted during the summer, certain sectors did better than others: "Sales, profits and hiring at many grocers and home-improvement retailers are up. Many apparel sellers have slashed staff and closed stores for good."

    The story goes on:  "The pandemic pushed many of the last online-shopping holdouts over the e-commerce hump. Online transactions with credit and debit cards have increased an average of 88% each month since the beginning of April, according to weekly transactions collected by financial-data firm Facteus."

    •  The Wall Street Journal reports that in New York City, the annual Greenwich Village Halloween Parade, "an affair that draws thousands of costumed participants and a far greater number of spectators," has been cancelled because of the coronavirus.

    However, the governors of New York, New Jersey and Connecticut - early hot spots that of late have had low infection numbers - have not banned Halloween trick-or-treating.  Events in all three states are being allowed to go forward, albeit with "capacity restrictions and other pandemic-related requirements."

    Meanwhile, the Washington Post reports that "costume shops, party stores and seasonal pop-ups that rely on Halloween for the bulk of their profits say they’re bracing for a steep drop-off in sales that could tip them into insolvency. Halloween spending is expected to fall 8 percent, to $8.05 billion, with costume sales accounting for much of the decline, according to the National Retail Federation."

    •  The Wall Street Journal reports on a new restaurant trend - time limits.

    "To survive the pandemic, some restaurants are taking an unusual approach to hospitality: showing diners the door," the story says.  "They are limiting meals to 90 minutes or two hours to stay afloat amid capacity limits due to the virus."

    The story goes on:

    "Reseating parties more quickly throughout the evening allows restaurants to benefit from higher food sales rather than letting the same guests linger at the table.

    "Turnover is especially important when Covid regulations call for serving fewer guests in the dining room at one time and keeping diners farther apart.

    "The strategy often clashes with customers’ wishes. Many who are just resuming dining out want to do so at a leisurely pace. Among people planning to return to restaurants, 29% said that they would stay longer than before to enjoy their time out, according to Datassential, a food-industry market-research firm in Chicago. Feeling rushed, especially after months of not dining out, can have a negative impact on experience, says Datassential’s Mike Kostyo."

    •  The Daily Beast reports that "Ireland could face harsh new coronavirus restrictions within days after the country’s public-health advisory team recommended the country go back into an almost total lockdown. Pubs and restaurants would only be allowed to offer takeout and nonessential retail outlets would close if the country, which is split between Level Two and Level Three of a five-level restriction system, moves to Level Five. All sports would be canceled, social visits would be banned, and people would be legally obliged to remain within 5 kilometers of their homes. Only six people would be permitted to attend a funeral and only 10 people allowed at a wedding."

    •  The fallout from the pandemic continues to affect the movie business, which is reacting to the unwillingness of patrons to go back to theaters and the decision by Regal to close its cinemas indefinitely because of lack of business.

    Variety reports that "Warner Bros. and Legendary Pictures have delayed the release of Dune, the big-budget sci-fi epic from director Denis Villeneuve. It will no longer premiere on Dec. 18 and is now slated to debut in theaters on Oct. 1, 2021."

    And the Hoillywood Reporter writes this morning that "The Batman, which stars Robert Pattinson as the caped crusader, is on the move again. After a series of production delays, the superhero pic’s release date in theaters is being pushed from Oct. 1, 2021 to March 4, 2022, Warner Bros. announced Monday evening."

    Look for a lot more delays going forward, or shifts to streaming platforms.

    Published on: October 6, 2020

    •  Fox Business reports that "protesters again gathered outside one of Amazon CEO Jeff Bezos' multimillion-dollar homes on Sunday to demand better conditions for warehouse workers.

    "The Congress of Essential Workers, a group founded by fired Amazon employee Christian Smalls, gathered about 100 people outside of Bezos' Beverly Hills mansion … The group has previously held rallies outside of Bezos' homes in New York City and Washington, D.C."

    Among the group's demands:  "The right to unionize … Free child care and health care … Employees being tested for COVID-19 be placed on full paid leave until they test negative and can return … $30/hour minimum wage … (and) reinstatement of all employees fired during the pandemic for 'refusing to work, protesting or related reasons'."

    According to Fox Business, "The group also advocates for a federal wealth tax of up to 3% ='not only to fund Amazon workers but also to help deal with global crises like climate control, homelessness and pandemics'."

    Published on: October 6, 2020

    •  Fresh Thyme Market announced that Liz Zolcak - formerly the vice president of operations at Kroger, president of Kroger's Ruler Foods division, and director of corporate buying at Aldi - has been named VP of operations.

    Published on: October 6, 2020

    •  The New York Times reports that iconic Schaefer Beer - longtime sponsor of the Brooklyn Dodgers and "the one beer to have when you're having more than one" - is being brought back by Pabst - reformulated, with a refreshed label, but the same slogan and jingle.

    •  Store Brands Magazine reports that Texas-based c-store chain Kwik Chek is rebranding its 47 units as TXB - or "Texas Born" - and is changing its private label products to match.

    Published on: October 6, 2020

    I did a FaceTime video yesterday about how I ordered some face masks and vinyl gloves from Amazon on Sunday afternoon, and they showed up - via the increasingly familiar gray Amazon truck - by 7:30 am Monday morning.

    One MNB reader was less impressed:

    Yes, Amazon delivery time is impressive – gee, only 15 hours from time of ordering to your front door. Of course, you could have taken a 10 minute drive to a local market or drug store and purchased the same items. Granted Amazon is pushing to shorten delivery times and Walmart is doing the same. Everyone wants rapid delivery. I would rather put on my mask (and gloves, if warranted) and drive a few minutes from my home and purchase whatever it is I need. Don’t forget if you live in a rural area you wouldn’t be getting such quick delivery from Amazon. You might have to drive further but it will still be a lot faster!

    And another MNB reader was even less impressed:

    How nice you get first-rate treatment from Amazon... my thought is someone there knows you will write a glowing review of them as you are wont to do several times a week.

    My experience has been a bit different.  Now... I too am a Prime member and have been ordering things from Amazon long enough so that I also had received one of those travel coffee mugs years ago.

    Back in March, an elderly family member need his telephone replaced (yes he still has a landline) and we were not about to travel the four hours to either shop there for him or shop here and ship it... so I thought Amazon would be the best bet.  WRONG!  Even though the Panasonic phones were in stock and "Prime eligible" the delivery time frame was ONE MONTH which I, unfortunately, did not notice until after I clicked the purchase button.  I contacted Customer Service and was told "It's because of the pandemic".

    Since then I have not received ANY of my frequent orders in the "promised" 2 days.  I only continue to use Amazon as I am in the age demographic that should stay away from stores as much as possible.  So last Thursday when my husband's laptop died we shopped again online.  The ETA for his replacement with "Prime" was a full week - for an IN STOCK item.  This is better for us than having to physically go inside a Best Buy for safety reasons... but still annoying!

    I do not expect you to print this, but I want you to be aware that not everyone gets the same A+ treatment that you do from Amazon. 

    First of all, of course I would print this.

    I wish I had an answer for you.  But I am pretty sure that the filks at the distribution center have no idea who I am or are in any way giving me special treatment.  Though I'm flattered you think I am important enough to merit such attention.

    Besides, it isn't just me, as another MNB reader wrote:

    I had the same experience yesterday!  Went to 3 stores to find a colored ink cartridge…all stores were out.

    Come home – check Amazon – submit order at 3:30 pm yesterday and it arrived at 11:30 this morning.

    Ugh…why didn’t I check Amazon originally! 

    The thing is, Amazon won't always be the best or fastest option.  But they do this stuff often enough, to enough people, that they establish the baseline for customer experience.  Others will have to live up to the standard, or be found wanting.

    I observed yesterday that Walmart seems more focused on investing in "new" economies, while pulling out of "old" economies.

    Prompting MNB reader Greg Seminara to write:

    International represents more than 20 % of Walmart’s business and a key growth engine.

    The USA represents only 4.3 percent of the worlds mouths, so lots of opportunity overseas.

    However, Walmart does not have the golden touch everywhere, with departures from UK, Germany, Brazil etc.

    Look for Walmart to exit Japan next and Argentina if they can ever find a buyer.

    Walmart’s international learning curve has been to shift resources to countries where they have a dominant market share like Mexico,Chile,Central America or strong e-commerce platform (India). 

    Responding to my obit for Bob Gibson yesterday, MNB reader Deborah Faragher wrote:

    I always thought his first name was “Great” because my husband has never referred to him as anything other than “The Great Bob Gibson”.


    And finally, reacting to last Friday's OffBeat column, MNB reader Monte Stowell wrote:

    Just a thought for every Friday. How about recommending one or two of movies every Friday. I just added The Parallax View and Three Days of the Condor to my watch list. Thanks.

    I think I've done a lot of that over the years - both old and new movies - but I'll admit that I've been a little lax lately.  I'll try to be better.

    Published on: October 6, 2020

    •  In Major League Baseball, the American League Divisional Series started last night, as the Houston Astros defeated the Oakland Athletics 10-5 to take game one of their best-of-five series.  A few hours later, the New York Yankees beat the Tampa Bay Rays 9-3, going up 1-0 in their best-of-five series.

    •  In Monday Night Football action, the Kansas City Chiefs defeated the New England Patriots 26-10 in a game postponed because Pats QB Cam Newton tested positive for Covid-19, while the Green Bay Packers beat the Atlanta Falcons 30-16.