retail news in context, analysis with attitude

Published on: January 14, 2021

KC has some thoughts about two different approaches to doing business.  There's gnashing your teeth because of uncertainty, and there's getting aggressive to create and fill a need.  And, he has examples….in this case, from the film industry.  Earlier this week, Variety had a story about how movie studios were wringing their hands and gnashing their teeth, trying to figure out how and where to release their movies, amid persistent concerns about when people will be confident about going to the theater.

Netflix, on the other hand, had a different approach … release at least one new movie every week.  Here's a preview:

Published on: January 14, 2021

Costco announced that it is closing all its in-store photo centers as of February 14, and recommends that customers pick up all their orders by March 28.

In an email to customers, Costco said, ""Since the introduction of camera phones and social media, the need for printing photos has steeply declined, even though the number of pictures taken continues to grow.  After careful consideration, we have determined the continued decline of prints no longer requires on-site photo printing."

USA Today reports that "some services will be available on the website for delivery, including prints, enlargements and posters; stationary and photo greeting cards; photo books and calendars; photo blankets and other photo gifts; and business printing products.

"After the centers close, a few other services won't be available such as ink refill, passport photos, photo restoration and YesVideo Home Movie Transfer Service."

Published on: January 14, 2021

Forbes reports that airport retailer Hudson has struck a deal with Amazon to use its Amazon Go checkout-free technology in some of its stores, starting with one at Dallas Love Field Airport.

According to the story, the test store will be called Hudson Nonstop.  "If the Nonstop trial goes well, Hudson - which has gradually been reopening shuttered units across North America - plans a wider rollout at U.S. airports under the new fascia."

That could be a big deal, since Hudson has "more than 1,000 stores in airports, commuter hubs and tourist destinations across North America. Eliminating checkout lines and waiting times at more of them could be appealing to consumers worried about Covid-19 in enclosed spots like shops."

Published on: January 14, 2021

Glassdoor, the website that allows employees to evaluate the companies for which they work, is out with its 13th annual Top 100 Places to Work list, drawn from anonymous feedback generated by people who actually work there.

The top 10:  Bain & Company … NVIDIA … In-N-Out Burger … HubSpot … McKinsey & Company … Google … Delta Air Lines … Lululemon … Microsoft … and H-E-B.

Some of the other retailers included on the list:  Trader Joe's (#35), Wegmans (#36), REI (#48), Costco (#56), and QuikTrip (#100).

Published on: January 14, 2021

From CNBC:

"Walgreens said Wednesday it will offer a growing list of financial products for customers - including a co-branded credit card and a prepaid debit card - as it tries to win more of their wallets and help them manage pricey medical expenses.

The credit cards will launch in the second half of this year. They will be part of the Mastercard network and issued by Synchrony. They will be linked to Walgreens’ new loyalty program, which the company relaunched in November with a new name, perks and Covid pandemic-inspired features, such as curbside pickup and delivery through DoorDash and Postmates."

Published on: January 14, 2021

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've now had 23,616,345 total confirmed cases of the Covid-19 coronavirus, resulting in 393,928 deaths and 13,975,036 reported recoveries.

Globally, there have been 92,872,157 confirmed coronavirus cases, with 1,989,020 resultant fatalities and 66,417,567 reported recoveries.  (Source.)

•  From the Wall Street Journal:

"Newly reported coronavirus cases in the U.S. remained above 200,000 for the ninth day in a row, while hospitals continued to see large numbers of Covid-19 patients.

"The U.S. reported more than 224,000 new coronavirus cases for Wednesday, according to data compiled by Johns Hopkins University. The nation’s death toll grew by more than 3,800 Wednesday, lower than the record of more than 4,000 fatalities the previous day, but still higher than daily levels recorded last year … Hospitalizations due to the disease topped 130,000 Wednesday for the second consecutive day, while 23,877 patients required treatment in intensive-care units, according to the Covid Tracking Project."

•  From the Washington Post:

"Scientists at Ohio State University’s Wexner Medical Center and College of Medicine have discovered a new variant of the virus that is similar to the mutation found in the United Kingdom but probably originated in the United States, researchers announced Wednesday. The new mutations challenge scientists to determine whether they will cause vaccines and therapeutic approaches to be less effective, according to one of the lead researchers.

"Texas became the second state to record 2 million coronavirus infections since the start of the pandemic, the Houston Chronicle reported. California reached that figure in December."

•  The Wall Street Journal reports that "Dollar General Corp. is offering employees a deal: Go get a Covid-19 vaccine and receive four hours of pay.

"The retailer, which has 157,000 employees, is among the first large U.S. employers to incentivize staff to be vaccinated, a sign that companies with essential workers see mass inoculation as critical in overcoming the pandemic."

The story notes that "some big employers have said they want as many workers as possible to be vaccinated but will stop short of requiring staff to get shots. Verizon Communications Inc. told staff this week it won’t require them to get vaccinated, and CVS Health Corp. , whose pharmacists are distributing vaccines and are themselves eligible for doses, said it encourages but doesn’t mandate shots.

"Many hourly workers face challenges in getting to vaccine appointments, from child-care needs and transportation limitations to scheduling constraints from holding multiple jobs. Some retail workers are wary of seeking medical services because they receive the minimum wage and often lack access to work-sponsored health insurance coverage or paid time off."

•  From WKRC-TV News:

"Kroger will not require employees to get the COVID-19 vaccination. That announcement comes as the grocery chain gears up to administer the vaccine at its clinics."

The story notes that "as the rollout continues in the Tri-State, it's not exactly being widely accepted. In Kentucky, more than 30% of people eligible are declining the vaccine. In Ohio, 60% of nursing home staff are passing."

•  The Wall Street Journal reports on how tourists traveling to Florida now want more than just warm weather.

They want vaccines.

"Some of the arrivals are Americans or foreigners who own second homes in the state and reside here part-time. Others are making short-term visits, seizing the opportunity provided by Florida’s decision to make the vaccine available to people age 65 and older, including nonresidents. The practice, which some are calling vaccine tourism, has drawn fire from some officials and residents.

"Interest is up sharply from Canadians who are looking to travel to the U.S. for vaccinations, according to Momentum Jets, a private jet service provider in Toronto."

•  CBS News has done a count among all the airlines that have compiled no-fly lists  comprised of passengers who have "refused to wear masks and harassed crew members," and the total apparently now comes to "more than 2,700 people."

The list has no legal standing - it is just people that the airlines have decided can no longer board their planes because they don't comply with the rules.  It is different from the federal no-fly list.

However, the Federal Aviation Administration (FAA) "has announced it will start taking legal action over such behavior going forward," CBS News reports.  "The order signed Wednesday by FAA Administrator Steve Dickson means unruly passengers will no longer get a warning or counseling, which the agency said had been common practice in such incidents."

One interesting note from the story:  "Many of the bans have occurred in the last week, after the violent riot at the U.S. Capitol. "

From my perspective, it is about time federal regulators start taking action against these people.  Ban 'em, fine 'em, make their lives miserable.  They clearly don't give a damn about their fellow citizens, so let's not spend a lot of time worrying about whether they can enjoy the privileges of riding on airplanes.

There has been a lot of discussion of the no-fly list in the wake of the ransacking of Capitol Hill last week - one argument is that if you accept the notion that these essentially were acts of domestic terrorism, then a federal no-fly list designed to screen out suspected terrorists ought to include every person involved in last week's attack on the Capitol.

•  The Los Angeles Times has what can only be described as a kind of morbid story, about a company in Laguna Hills, California, called Salam International that has had its best year ever - its California and New Jersey warehouses can't keep up with demand created by the pandemic.

Salam International is in the body bag business.

"In operation since 1992, Salam International’s business is death. Its 337-page catalog lists everything from autopsy tables to cadaver lifts to three-body refrigerators to an economy embalming station that’s on sale for $3,500.

"For the past 12 months, body bags have made life hectic for Salam. Clients can buy them in 16 colors, from black to baby blue to emerald green. With zippers down the middle, around the top or on the edges. Adult- and child-sized. In orders of one or by the tens of thousands."

Published on: January 14, 2021

The Los Angeles Times reports that "a handful of app-based drivers in California and one of the nation’s largest labor unions are taking to the courts to dispute Proposition 22, posing the first legal challenge to the state’s voter-approved law allowing gig companies to keep treating their workers as independent contractors."

According to the story, "The Service Employees International Union filed the lawsuit Tuesday with the state Supreme Court alongside drivers Hector Castellanos, Saori Okawa and Michael Robinson, as well as ride-hail-app user Joseph Delgado, the labor group said. The lawsuit argues that Proposition 22 unconstitutionally limits the power of California’s Legislature to govern, removing its abilities to grant workers the right to organize and give access to the state workers’ compensation program."

The Times offers some context:

"The lawsuit, Proposition 22’s first legal challenge, comes just weeks after the new law went into effect.

"Proposition 22 was bankrolled by Uber, Lyft and other gig economy companies seeking a carve-out from a sweeping state labor law that required the companies to classify their large numbers of workers as employees instead of independent contractors. It became the most expensive ballot measure in U.S. history, and cruised to a victory with 58% of the vote."

Published on: January 14, 2021

•  During a virtual keynote at CES 2021, Walmart CEO Doug McMillon said that he believed many of the changes instituted during the pandemic "won't go back" to how they used to be, citing adaptations the retailer had to make "to how customers wanted to live and shop, which taught the company lessons on the importance of using new technology, such as robotics and artificial intelligence, to better interact with them."

“We’ve got to get better at forecasting demand, so artificial intelligence and the way we use data is really important,” he said, adding that "we’ve got to build capacity for delivery."

•  CNet reports that Walmart CEO Doug McMillon said yesterday at CES 2021 that "companies can use the same data analytics tools that help grow productivity, profits and customer loyalty to improve diversity within the company … For Walmart, that includes examining pay and promotion policies, and giving employees more information about how much diversity is represented in new hires and different levels of management."

"Put the business to work," he said.

According to the story, "McMillon made the remarks as he talked about Walmart's response to calls for an end to systemic racism this summer in the aftermath of the murders of George Floyd, Breonna Taylor and Ahmaud Arbery. Other executives, including the heads of Best Buy, Mastercard and Accenture, have discussed how large businesses can create financial opportunities for Black people.

"In addition to internal diversity efforts, the companies have made financial commitments. Mastercard plans to invest in $500 million Black communities, and Walmart set aside $100 million for philanthropic efforts that address inequality in the 'healthcare, education, and criminal justice systems'."

•  From CNBC:

"Walmart Chief Customer Officer Janey Whiteside said Tuesday that many of its shoppers don’t expect the economy to quickly bounce back from the coronavirus pandemic.

"Almost half of customers surveyed in November told Walmart that they were worried about the current health of the economy, she said when speaking at the virtual National Retail Federation conference. She said 40% said they didn’t expect 'any kind of speedy recovery'.

"'Our core Walmart customer is absolutely not immune to the economic slowdown, in fact may even be disproportionately impacted,' she said, noting that the pandemic has bifurcated society as it’s hit some industries like hospitality and not others."

According to the story, "Whiteside said the company realizes customers feel financially strapped as they try to put food on the table and juggle other expenses, such as school supplies for their children. She said 'galvanizing around that group of customers who needs us more than ever really is the fuel that keeps Walmart going.

"'We know they’re continuing to look for ways to save money on basic items, so whether that is looking to switch from national brand to private brand, look for small pack sizes, cherry-picking deals when they’re available,' she said. 'We also know that they are continuing to make sure they don’t have to sacrifice on experiences for their families, so they’re looking at where they can balance the wallet'."

Published on: January 14, 2021

•  From the Puget Sound Business Journal:

"Amazon is opening two new Amazon Fresh grocery stores - one in Seattle and another in Bellevue, the company announced Monday morning.

"The Bellevue store will be located in Factoria and the Seattle store will be located in the city’s Central District. Both sites are under construction, an Amazon spokeswoman said. 

"The company hasn't disclosed the addresses for each location, nor did it say when the stores would open. Amazon said in a statement that hiring has begun for both stores, which are expected to bring 'hundreds of full- and part-time jobs, including managerial roles' to the Puget Sound region."

•  Reuters reports that the state of Connecticut "is investigating whether Amazon.com Inc is engaged in anti-competitive behavior in the e-book business through its distribution agreements with certain publishers, the state’s Attorney General William Tong said on Wednesday.

"The probe comes as technology companies face a backlash in the United States and across the world, fueled by concerns among competitors, lawmakers and consumer groups that firms have too much power and are harming users and business rivals."

•  CNBC reports that "Amazon will be the leading share gainer among the major digital ads businesses in 2021 and 2022, according to a new ad buyer survey from Cowen released Tuesday.

"Amazon’s ad business will continue to grow as more spend comes from TV, search and other digital platforms and as buyers see strong return on investment on the platform. Amazon’s ad business also appears, at least in buyers’ eyes, to be less exposed to the ongoing privacy debate and upcoming Apple privacy changes for ad tracking on the iPhone."

Published on: January 14, 2021

With brief, occasional, italicized and sometimes gratuitous commentary…

•  From the Wall Street Journal this morning:

"Worker filings for jobless claims jumped to nearly one million last week, indicating rising layoffs amid a surge in Covid-19 cases.

"Economists surveyed by the Wall Street Journal expected new unemployment claims, a proxy for layoffs, to come in at a seasonally adjusted 800,000 last week.

"The report added to the evidence that the rapid rise in Covid-19 cases and fresh business restrictions in some places are weighing on the labor market. Employers cut 140,000 jobs in December, marking the first decline since the pandemic hit the country last spring. Leisure and hospitality workers bore the brunt of the decline, as a nationwide surge in coronavirus infections forced many restaurants and bars to close or scale back operations."

•  The Associated Press reports that Target "reported Wednesday that online sales surged 102% between November and December. Sales at its stores opened for a least a year rose 4.2%. Customer traffic rose 4.3%, and the average amount of sales per customer rose 12.3% as they consolidated trips to different stores during the pandemic."

The performance, according to the story, reflected the fact that "changes made during the pandemic once unthinkable have worked so well that they may become the new norm.

"For example, Target closed all of its stores on Thanksgiving, traditionally the starting gun for the holiday season, rolling out discounts and specials early and over a broader period to control traffic in stores.  It said Wednesday that it will close its stores again on Thanksgiving this year."

•  Bloomberg reports that "Nordstrom reported a sharp drop in holiday sales, but the worst could be behind it as it says demand has continued to strengthen in the new year.  Net sales tumbled about 22% during the nine-week holiday period ended Jan. 2 compared to last year."

However, while the department sector was slammed during 2020 - largely because of the pandemic, but also because of broader consumer behavior shifts - "Nordstrom was able to pick up more digital shoppers this holiday … accounting for 54% of total sales compared with 34% from the same period in 2019."

This has come up here before, and it is what gives me confidence in how Nordstrom is approaching the future - it is embracing the fact that it does most of its business online, not resisting the shift.  Many of the investments it has made over the past few years have been geared to laying the infrastructure to support this shift, and I still think it seems likely that we'll see it do more with Nordstrom Local-style formats.

Published on: January 14, 2021

•  Krasdale Foods announced the promotion of Cynthia Ramos, the company's VP-Sales, to the role of  Chief Sales Officer.

Krasdale also said that Howie Kent, Sales Manager of Voluntaries, has been promoted to be Director of Category Management and Sales Analytics.

Published on: January 14, 2021

I really enjoyed this email from Thomas Parkinson, reacting to yesterday's piece about how Walmart is teaming with a company called Home Valet to pilot a temperature-controlled smart box designed to facilitate home deliveries of groceries.  Parkinson, for those of you who may not know this, is the co-founder and longtime CTO at Peapod.

I saw the Walmart unattended delivery box in MNB.  Thought I would attach the PodBag which Peapod launched 3 years ago for unattended delivery.  It is a low cost, temperature controlled box/bag that can be easily stored at home after delivery.  It can store a $200+ order no problem.  We rolled it out in Chicago (RIP) and Giant/MD.  I think it is now available in CT.  We were always thinking outside the box :).

Another MNB reader wrote:

Wow, what a step back to the past to get to the future…sort of.  When I was a kid we had a metal insulated box that sat on our front porch.  The Prairie Farms Milk Delivery man would put in that box our milk and our cottage cheese.  My mom had ordered it by phone.  The box would keep the items cool until someone got home or went out and got them out of the box.  This was back in the 1970’s in small towns in Missouri.

MNB reader Tim Callahan had a thought about Michael Sansolo's column about Tommy Lasorda:

When to talk.... when to listen... when to say nothing. Vin Scully introduced the situation...framed each pitch as the count evolved and then said NOTHING after the home run.

I will try to remember Vin Scully as the best teacher when I approach impossible situations.

Thanks for sharing history!

MNB reader Lisa Malmarowski wrote in about our piece about how growing trust in the business community means that business leaders have the opportunity to actually lead:

Consumers expect this because we’re a capitalistic society and corporation funding keeps the greasy wheels of our political system rolling. To say this is okay, is frankly horrifying. Look, I work in marketing for the grocery industry and I can see both sides of this tarnished coin. Businesses absolutely have to step in and be the “government” that we’ve paid for collectively. Just because this is the way things are doesn’t necessarily means it’s right, just or human-needs focused.

I don’t think we can trust corporations to do the right thing for most people when their existence is based on sales. The folly that is the Covid-19 vaccine is a prime example. Multi-national pharmaceutical companies own the patents for decades on these vaccines so you can bet that the wealthy nations will get their populations vaccinated while the less wealthy continue to wait and hope for several years. This isn’t okay.

We’ve lost our humanity. (And in case you wonder how I, someone in marketing, make peace with this - I work for a cooperative where the owners in our business share in the risk and profit and one of our international principles is concern for community). 

We had a story the other day about how dunnhumby's fourth annual Retailer Preference Index (RPI) concluded that Amazon is most preferred by US consumers - a leap seen as driven by safety concerns created by the pandemic.  I suggested that retailers should not think that this necessarily will change when the pandemic subsides.

MNB reader Glenn Cantor then sent us an email that I posted yesterday about how, during the pandemic, "the traditional grocery chains in my area have not appreciably changed their retail shopping experiences as a result of the Covid-19 pandemic … In fact, other than the increase in store-employed shoppers, the wearing of masks, and offering one or two hours a week for seniors, I cannot think of any notable changes or improvements made to improve the shopping experience."

I commented:

I respect the fact that your shopping experience isn't much changed.  I'm not sure that invalidates the dunnhumby findings … and I think that retailers ignoring the shift could find themselves disadvantaged in the long term.

Prompting another MNB reader to write:

The fact that Glenn cannot think of notable changes or improvements validates the dunnhumby findings. He does seem to be trying to invalidate the findings.

I don’t understand your comment on respecting an unchanged shopping that Glenn is not praising but just reporting.. Perhaps there was a part of the letter that you did not print or perhaps you wrote before your morning coffee. In any case keep on as a champion of change and keister kicker. 

Actually, what I meant to write was:

I respect the fact that you like the idea that your shopping experience isn't much changed ….

The point that I wanted to make, and apparently garbled, was that not changing because of evolving circumstances and shifting consumer demands is a recipe for disaster.

Thanks for helping me to clarify.

The note that CNN is closing down its travel channel that serves dozens of airports prompted the following response:

It’s about time someone pulled the plug on Wolf Blitzer at airports.   Maybe the departure “lounges” will be quiet again when we all return to traveling?  Here’s hoping.

Finally … yesterday we posted an email from MNB reader Charles Bartell in which he wrote:

Amazon is going to pay a price for removing Parler from the AWS platform.  Jeff Bezos will be seen as having too much power.  Freedom of speech is sacred in the United States.  This move was a step too far.

I disagreed:

I'm not sure about that.  I wonder how many people will give up their Prime memberships and "free" two-day delivery because Parler is harder to access.

And, for the record, Amazon argues that by refusing to police violent content on its site, Parler was in violation of its rules of service.

“This case is not about suppressing speech or stifling viewpoints,” Amazon’s attorneys write. “Instead, this case is about Parler’s demonstrated unwillingness and inability to remove from the servers of Amazon Web Services ('AWS') content that threatens the public safety, such as by inciting and planning the rape, torture, and assassination of named public officials and private citizens.”

And you think it was Amazon that went too far?

Charles Bartell got back to me with another email:

Jeff Bezos now has the power to decide what is free speech and from which Amazon shall protect us?  We should not entrust big tech to protect us from awful words.   It is only education that allows a free people to determine speech that is worthy of action. Too many lives have been sacrificed to allow us to decide which speech is worthy of action.  Allowing oligarchs to determine that which is palatable speech is no different than Xi and Putin suppressing freedom of speech (and in more advanced states thought) in their nations.

Sorry, but I will never be convinced that I need Bezos to determine what I should be able to hear.  I for one, will no longer use Amazon.  I doubt, that I will be the only person to do so.

For the record I do not condone the awful things hosted on Parler - but I will determine what is actionable speech and not actionable.  Where was Amazon in determining what horrible lyrics we should hear in music that they offer in their stores?  Oh, they didn’t.  The consumer decided. 

I'm not nuts about anyone deciding what I can see and hear … but I think there is a vast difference between records with vulgar lyrics and a website that incites "the rape, torture, and assassination of named public officials and private citizens."

I think that any person who incites or advocates for such things ought to be tossed in the hoosegow.  And if Amazon chooses not to be part of such incitement, that's okay with me.  I don't think it should be forced to be an accomplice in what could be a criminal act.

From another reader on the same subject:

I agree with Parler's removal, but can see both sides on this.  One side people are calling for corporate responsibility, which I believe this is.  On the other, people scream if we stifle free speech.  I want free speech, but not the junk that Parlor puts out.  So there is the dilemma, who is the gatekeeper on this information?  Give the control to the corps, then you set up a system where you have many different opinions governing the information you receive.  If you fall back to the common thought of free speech, then you open the door for deviant practices.  Can’t have it both ways as it stands today.

I guess I look at it this way, if it goes against the moral compass of society, then it should be censored.  It if promotes good, healthy principles and practices, then let it through.   I vote for both ways.

Moral compasses ain't what they used to be.

I think censorship is when a government says what you can and cannot say, though, to be clear, there are times when it can and should.  (You can't yell "fire" in a crowded theater.)

I'm not sure it is censorship when a private company decides what it is going to post or publish.

If so, then put me down as guilty, because I decide which emails to run and which ones not to.