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    Published on: February 26, 2021

    KC reflects on the fact that it was one year ago today that he took his last airline flight.  When he went to the Dallas airport, he noticed that one of the TSA agents was wearing a facemask.  "Hmmm…," he said to himself.  "I wonder if that means something."

    Published on: February 26, 2021

    For this first Retail Tomorrow on MNB interview, KC is joined by Sterling Hawkins, co-founder and co-CEO of CART, the Center for Advancing Retail & Technology, and their guest Brian Moran, co-founder and CEO of Citrus Ad, a digital platform that has unleashed the potential of online shelf space for retailers that include Wakefern, Hy-Vee and Sainsbury and Ocado.

    The discussion focuses on the potential power of retail media networks, how retailers can use them to generate revenue that can be used to fund new initiatives and needed infrastructure, and how the pandemic has created greater focus on a strategy that, with the use of technology and data, is truly coming into its own.

    If you want to listen to this "Retail Tomorrow on MNB" segment as audio, you can do so here, or can download the file.

    For more information about CitrusAd, click here.

    Published on: February 26, 2021

    Costco announced yesterday that it will raise its wage floor nationwide to $16 an hour.

    According to the Seattle Times, "The update directly applies to about a fifth of the more than 160,000 Costco employees who work hourly, accounting for 90% of Costco’s U.S. workforce, CEO Craig Jelinek said at a U.S. Senate committee hearing on how large companies pay their workers.

    "The pay bump, which takes effect next week, pegs baseline wages at the Issaquah-based wholesale club above those at competitors Amazon and Target, which have instituted $15 wage floors in recent years. The minimum wage at Walmart, the largest employer in America, is $11, although the company said last week that it was raising the wages of 425,000 workers and that about half of its U.S. workforce would earn at least $15 an hour."

    The Times goes on:  "'This isn’t altruism. At Costco, we know that paying employees good wages and providing affordable benefits makes sense for our business and constitutes a significant competitive advantage for us,' Jelinek said. The company’s relatively high wages minimize turnover and maximize productivity, he said."

    KC's View:

    The difference between Costco and a lot of retail entities is that Costco seems to understand that its growth is dependent on satisfied customers who continue to pay their membership fees and shop at its stores - and that is dependent on a strong employee base that makes customers happy.  That's a priority and a core value.

    At a lot of retailers, the priority and core value is keeping labor costs as low as possible - even if, in some cases, part of the value equation is customer service.

    You'd think more businesses would understand the wisdom of Jelinek's words.  If they did, there might not even be a debate over a national minimum wage.

    Published on: February 26, 2021

    The Los Angeles Times reports that the LA City Council  "voted 14 to 1 to require larger grocery stores and drugstores to boost the pay of their workers by $5 an hour for the next 120 days.

    Similar mandates have passed in Seattle, Oakland, San Jose and Long Beach and for unincorporated Los Angeles County, with legislators saying that grocery store workers are risking their health to stock the shelves during the pandemic and deserve compensation."

    KC's View:
      I repeat, it is bad public policy to focus on just one category of workers.  I'd be a lot more impressed if these lawmakers would send medical vans to every grocery store in their communities to make sure that workers can get vaccinated.  

    Published on: February 26, 2021

    Catalina is out with new data analysis based on customer behavior during the past year of the pandemic, concluding that "several categories have experienced strong sales spikes, while others continue to struggle."

    According to the study, "The Top 5 categories seeing the greatest sales growth over the past year literally help keep the coronavirus at bay:  Home Health Testing Kits (includes Face Masks) - up 314% … Liquid Hand Soaps - up 246% … Disinfectant Cleaners - up 235% … Personal Moist Towelettes – up 155% … and Household Cleaner Pre-moist Wipes – up 129%."

    Catalina says that "eight of the next 10 top-selling categories are either food or beverages that show an increased appetite for convenience and/or comfort … Refrigerated Snacks/Cakes – Up 87% … Juice – Frozen Drink Smoothies – Up 85% … Frozen Vegetables Breaded – Up 83% … Powdered Milk – Up 82% … Frozen Seafood – Up 71% … Bacon: Light/Turkey/Chicken – Up 65% … Baking/Biscuit Mixes – Up 64% … Breakfast Drink Mixes – Up 61%."

    And, the data says that "with so many Americans encouraged to work and attend school from home, there has been a noticeable decline in sales of personal care products over the past 12 months:  Wrinkle Reducers – down 27% … Breath Fresheners – down 26% … Face Cosmetics – down 20% … Cosmetics Remover – down 19% … Eye Cosmetics – down 11% … Hair Care/Styling – down 9%."

    Catalina also says that "in looking back at the past 52 weeks of data beginning with the week ending Feb. 15, 2020, shoppers made more trips than average in March as the pandemic set in, but drastically reduced trips in April as they began sheltering at home. The lingering impact of lockdowns paved the way for a nine percent average decline in weekly, in-person shopping trips starting in May 2020, compared to the prior year. While people by and large have been shopping less, they’ve been buying more. Spending per trip has increased by 23 percent on average, compared to 2019. Overall, average weekly spending on groceries has increased by 12%."

    Published on: February 26, 2021

    The New York Times has a story about so-called "ghost franchises," which takes the "ghost kitchen" concept to the next level:  "In the delivery app era, the ghost franchise can be a lifeline for the independent restaurateur, a way to make thousands of dollars a month in a devastating time. It can also be a liability, exploding the marketplace in ways that serve big brands more than small businesses."

    An example is Mr. Beast Burger, which builds on a brand established on YouTube:  "But MrBeast Burger is not quite what most of us think of as a chain, or even a restaurant. In exchange for a cut of sales revenue, the brand supplies the name, logo, menu, recipes and publicity images to any restaurant owner with the space and staff to make burgers as a side hustle. When a customer orders from the MrBeast Burger in Midvale, Utah, the food is prepared at a location of the red-sauce chain Buca di Beppo, following a standardized MrBeast recipe. In Manhattan, a MrBeast Burger is prepared at the neighborhood bar Handcraft Kitchen & Cocktails."

    According to the Times, "The business model hinges on deals the ghost-franchise parent companies strike with third-party delivery apps (which are notorious for taking advantage of workers and restaurants), using the leverage of having hundreds of listable 'restaurants' to broker top spots for them in search results … even an independent restaurant can get a virtual brand up and running in less than 30 days, with few limits to the number of brands one owner can take on. And that potential speed of proliferation could result in a delivery-app ecosystem where the ghost-franchise parent companies duke it out at the top, while the truly independent restaurants are pushed farther down the list."

    KC's View:

    Hard to be critical of anything that keeps restaurants in business and people employed.  In fact, I have to wonder if it only has to be restaurants that adopt these ghost franchises.  Why not supermarkets?  Or even hotel kitchens?

    The trend illustrates the degree to which virtual businesses can, through sheer marketing power, create actual businesses.  It isn't all smoke and mirrors - there's actual business going on here.

    The biggest problem I see is potential inconsistency, but that could be less of an issue than I think - people may want something different from their burgers in Texas than they do in Manhattan, and so a little local flavor could be a good thing.

    Published on: February 26, 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, there now have been 29,054,163 confirmed Covid-19 coronavirus cases, resulting in 520,852 deaths, and 19,436,463 reported recoveries.

    Globally, there have been 113,630,072 confirmed coronavirus cases … 2,521,025 resultant fatalities … and 89,205,504 reported recoveries.   (Source.)

    •  The Washington Post reports that "at least 46.1 million people have received one or both doses of the vaccine in the U.S.  This includes more than 21.6 million people who have been fully vaccinated … 91.7 million doses have been distributed."

    •  From the Wall Street Journal this morning:

    "Newly reported coronavirus cases in the U.S. topped 70,000 for the third consecutive day, but hospitalizations continued to decline as vaccination campaigns across the country ramped up."

    There were, the story says, "52,669 Covid-19 patients requiring treatment in hospitals as of Thursday, the lowest level since Nov. 4, according to the Covid Tracking Project. The number of Covid-19 patients in intensive care units declined to 10,846, 48% lower than levels a month earlier."

    •  Fox News reports that "the Food and Drug Administration (FDA) said Thursday it is allowing more flexible shipping and storage temperatures for the Pfizer-BioNTech coronavirus vaccine. The change permits transportation and two-week storage at -25 degrees Celsius to -15 degrees Celsius, which is often found in pharmaceutical freezers and refrigerators. 

    "Pfizer previously said the vaccine has demonstrated stability when stored at these temperatures and the approval would allow greater flexibility for shipping, distribution and pharmacies' and vaccination centers' management of the shot.

    "The vaccine was first authorized to be stored in an ultra-cold freezer at temperatures between -80 degrees Celsius and -60 degrees Celsius, and can remain stored at these temperatures for up to 6 months. They are shipped in specially-designed thermal containers that can be used as temporary storage for a total of up to 30 days by refilling with dry ice every five days. "

    •  The Washington Post reports that "a Food and Drug Administration advisory committee will meet Friday to review the safety and efficacy of Johnson & Johnson’s coronavirus vaccine, setting the stage for FDA authorization as early as this weekend.

    "If cleared, the shot would be the United States’ third vaccine against the pathogen, but the only one that provides protection with a single dose. Experts say it could expedite efforts to inoculate the population as virus variants spread."

    •  Giant Eagle said yesterday that it will partner with the Pittsburgh Steelers to host a four-day vaccination clinic n the PNC Champions Club at Heinz Field.

    According to Channel 4 News, "eligible patients can visit Giant Eagle's website "to search for availability and schedule appointments. If additional vaccine supply is made available, the clinic will be extended with additional appointments.

    "For eligible patients who do not have access to the internet, Giant Eagle Pharmacy is reserving a limited number of clinic appointments to be booked by phone at 1-877-288-2070 beginning Monday, March 1 at noon."

    I like it when retailers create partnerships like this that are designed to generate enthusiasm for getting vaccinated, because in the long run the only way we really beat the pandemic is by getting shots in people's arms.

    •  The Columbus Dispatch reports that "Ohio State President Kristina M. Johnson announced at Thursday's board of trustees meeting that the university's intention is to reopen campuses for 'safe and robust in-person experiences' this fall.

    "Johnson said the university is planning to expand in-person teaching, learning and student activities this fall with the approval of local, state and federal health authorities."

    I hope this is a harbinger of good things to come at every college campus.

    •  And, from the New York Times, a good think piece:

    "Across the United States, and the world, the coronavirus seems to be loosening its stranglehold. The deadly curve of cases, hospitalizations and deaths has yo-yoed before, but never has it plunged so steeply and so fast.

    "Is this it, then? Is this the beginning of the end? After a year of being pummeled by grim statistics and scolded for wanting human contact, many Americans feel a long-promised deliverance is at hand.

    Americans will win against the virus and regain many aspects of their pre-pandemic lives, most scientists now believe. Of the 21 interviewed for this article, all were optimistic that the worst of the pandemic is past. This summer, they said, life may begin to seem normal again.

    But — of course, there’s always a but — researchers are also worried that Americans, so close to the finish line, may once again underestimate the virus.

    Across the United States, and the world, the coronavirus seems to be loosening its stranglehold. The deadly curve of cases, hospitalizations and deaths has yo-yoed before, but never has it plunged so steeply and so fast.

    Is this it, then? Is this the beginning of the end? After a year of being pummeled by grim statistics and scolded for wanting human contact, many Americans feel a long-promised deliverance is at hand.

    Americans will win against the virus and regain many aspects of their pre-pandemic lives, most scientists now believe. Of the 21 interviewed for this article, all were optimistic that the worst of the pandemic is past. This summer, they said, life may begin to seem normal again.

    But — of course, there’s always a but — researchers are also worried that Americans, so close to the finish line, may once again underestimate the virus.

    You can read the entire piece here.

    Published on: February 26, 2021

    With brief, occasional, italicized and sometimes gratuitous commentary…

    •  USA Today reports on how, "as a mature company, Walmart's results are scrutinized for things like minor improvements in profitability, but there's something more important happening. The retail giant is rapidly evolving from a brick-and-mortar retailer to a diversified omnichannel business that can be both the world's biggest retailer as well as a provider of high-margin services."

    The analysis goes on:  "For years, it's been clear that Walmart is evolving beyond its historical business model as a physical retailer. Its acquisition of nearly five years ago helped accelerate its growth in e-commerce, and now the company is the second-largest online retailer in the U.S. with a robust grocery pickup business.

    "Building on that momentum, the company laid out its 'integrated omnichannel strategy' in the latest earnings report, saying that one of its goals is 'innovating to enhance a seamless, digital customer experience designed to deepen customer relationships and increase share of wallet, enabling the company to diversify the business model by growing related businesses with accretive margins such as marketplace, advertising, financial services, and data monetization'."

    I've long said that the difference between Walmart and Amazon is that Walmart's ultimate goal is to sell more stuff, and that Amazon has a more ambitious, we-want-to-be-integrated-into-every-part-of-your-life strategy in mind.  I'm not saying that one is right and one is wrong - just that they're different.

    While Walmart is getting more ambitious in its approach to businesses with accretive margins, I'm not sure I'm ready to change my mind - because those accretive margins are going to be used to help Walmart keep its prices low, its physical and digital stores more competitive, and its brand more relevant.  It is, I think, a powerful strategy.

    Published on: February 26, 2021

    •  The Wall Street Journal reports that "the jobs market appears to be returning to growth, with new applications for unemployment benefits falling to the lowest level since November amid other signs hiring is picking up.

    "Initial weekly unemployment claims decreased by 111,000 to a seasonally adjusted 730,000 last week, the Labor Department said Thursday. It was also the biggest drop in new applications for regular state programs since last summer.

    "The latest figures came as storms disrupted business in parts of the country and at least one state is adjusting for attempted fraud filings, factors that could have affected the totals. Still, weekly claims have dropped significantly since an early January peak above 900,000 and the four-week moving average, which smooths out volatility in the weekly figures, dropped to 807,750."

    •  USA Today reports that "Best Buy could close more stores than usual in 2021 as the shift to online shopping accelerates with people more reluctant to venture indoors during COVID-19, CEO Corie Barry said Thursday during the Minneapolis-based electronics retailer's quarterly earnings. The company has approximately 450 leases coming up for renewal in the next three years or an average of 150 each year."

    In addition to reconsidering its physical footprint, Best Buy also is taking a hard look at its staffing - earlier this month, it laid off some 5,000 full-time employees " because more shoppers are choosing to buy online instead of coming inside its stores. It will replace the 5,000 full-time employees with 2,000 part-time workers."

    “In addition to our physical stores, our operating model needs to evolve to meet our customers' changing shopping behaviors that have been accelerated by the pandemic,” Barry said. “The sudden and lasting shift customers have made to shopping more regularly and seamlessly across all of our channels has forced us to look at how we get our work done.”

    •  Marketing Daily reports that "Trader Joe’s and Walmart’s Great Value are the 'most loved brands,' offline and online respectively, based on positive conversations and referrals, according to Engagement Labs. "

    According to the story, "Other top brands on the offline list include Nintendo Switch (which last year led offline), Oreo, Dove, Minecraft, Lego, Lipton, Dove Men+Care and Nivea … Online, American Family insurance, which topped last year’s list held the number two spot this year. Others in the top 10 are Kirkland, Dove, Garnier Fructis, KitchenAid, Clean & Clear, Frigidaire, Clinique and Fabuloso."

    Published on: February 26, 2021

    Yesterday we took note of a Star Tribune story about how Best Buy is working with the Wunderman Thompson marketing agency and UnitedHealth Group's Optum unit (which is a pharmacy benefit manager and care services business) to "launch a paid fellowship program with the BrandLab that will train college graduates and help diversify the marketing and advertising industries."

    At the core of the program is a desire on the part of all three businesses "to boost equity, inclusion and diversity within their organizations," and comes at a time "when corporate marketing departments and advertising agencies nationwide have acknowledged that people of color are severely underrepresented in their ranks."  The program, seeded with $1 million from the three companies, will start by rotating 16 people through the three companies, working in internships designed to give them a broad level of exposure to different disciplines, such as "brand and digital marketing, art direction, design, copywriting and media practices …The end goal is to place all LabFellows graduates in full-time positions."

    One MNB reader responded:

    I love the fact that companies want to highlight and offer up opportunities for those that have interest and otherwise may not have received them.  As we get older (and hopefully wiser!) we owe that to those that are following us.  As far the definition of diversity, I have always encouraged my kids, my friends and my co-workers that it’s better measured by “how one thinks” as opposed to gender or the color of your skin.  I’m not naïve to think that there are still people who discriminate based on race or gender.  I get it; however, I’m going to continue to be “diverse” by purposefully including others in my life (both work and personal) that do not necessarily think like I do… regardless of their race, gender, age etc….

    Reacting to yesterday's MNB/In Conversation piece with Mike Sarrielle:

    Great interview.  The message conveyed, to be honest, made me think of past comments made on certain issues and how they have become more frequently negative, as this past year continued.  No excuses, the increased negativity is not to be blamed on Covid.  The blame is placed on how I handle it.

    This interview reminded me of my somewhat lost philosophy from when I was young, “It’s not about how many times you get knocked down, but more about how you get up again.”  So today, it’s time to get up again. Look more towards finding the positive views which hopefully will nudge others to do the same. Negativity is easy and infectious.  Positivity is much harder, but even more infectious.  Thanks for this eye-opening reminder.

    Got the following note responding to my enthusiastic callout of the new CNN series, "Stanley Tucci: Searching For Italy":

    I share your enthusiasm for the Stanley Tucci “Searching for Italy” show you FaceTime’d about.  My wife and I have loved it.  In fact, we honeymooned on the Amalfi Coast and in Rome (the locations of the first two episodes) almost nineteen years ago, and this brought back great memories for us.

    In addition to the wonderful experience with the food, as well as how the show explains the ties to the local history and culture, what struck me was how the show emphasizes the importance of the relationships that food creates: with the person cooking the food, serving the food, growing the food, the location it’s grown and made, etc.  I know for myself, and I suspect this is true for many others, one of the lessons of COVID has been the how important relationships are to life, and I think this extends to food, as beautifully demonstrated in this show.

    As you suggest, taking the lessons from this, and showcasing food as a vital experience is a great opportunity for retailers, and one that can’t be duplicated online very well, in my opinion. 

    Sunday at 9 pm EST on CNN.  I know what I'll be watching.

    Published on: February 26, 2021

    There's a new sport out there that is taking America by storm - pickleball.

    Axios has a story about how, "at a time when safe, outdoor recreation options are a premium, pickleball - which has become a craze among seniors in particular - is going increasingly mainstream … A cross between tennis, badminton and Ping-Pong, pickleball is played with a paddle and a plastic ball with holes on what looks like a miniature tennis court.

    "USA Pickleball, the sport's national governing body, says it has 40,000 members who play in all 50 states."

    The story goes on:  "While the Sunbelt states are the biggest pickleball hotbeds, demand for public courts is exploding everywhere … every park update and new 55+ community has a pickleball team/designated space.

    "In San Luis Obispo, California — where there's typically a 20-minute wait for a court — the city is spending $120,000 to build its first permanent pickleball courts … New England's first dedicated indoor pickleball complex is about to open in Hanover, Mass. (just south of Boston) with six tournament-sized courts."

    The only downside of pickleball seems to be that it can be noisy:  "The thwack of a wiffleball against a paddle is resonant, and condo and homeowner associations are being flooded with pickleball-related noise complaints."

    Stu Upson, CEO of USA Pickleball, tells Axios that the group is "doing some research on sound barriers, and looking at equipment" that's less loud."

    KC's View:

    I thought this was worth noting because how often does a sport come out of nowhere to capture the public's imagination?  I have to admit that I'd never heard of pickleball until a friend told me about it - Stu Upson, who I've known for almost 40 years, told me that he's just become the CEO of USA Pickleball.  "What the hell is that?" I said.

    Now I know.  This week, Axios.  Last week, The Economist.

    Guess I'm going to have to learn to play this game.

    Published on: February 26, 2021

    I have four movies to bring to your attention this week, two of them brand spanking new and two of them oldies but goodies.

    Nomadland is an extraordinary piece of serious moviemaking directed and written by Chloé Zhao, and starring Frances McDormand is a performance that is extraordinarily stripped down.  She plays Fern, a woman in her sixties who has lost her job at the US Gypsum in Empire, Nevada.  It is 2011, and her entire life is informed by loss;  not only has she lost her job, but she's also recently been widowed, and the entire town of Empire has virtually gone away - the film points out that its zip code has been cancelled.

    Fern takes to road, driving her van and wandering the American west, taking odd jobs where she can - packing orders in an Amazon warehouse, cleaning toilets in the campground, working in a restaurant at Wall Drug.  The movie finds her in the company of other nomads - not so much homeless, but houseless, she says - who are part of a kind of underground society, living and working on the fringes, all but invisible and barely getting by.  And yet, they're hanging in, living, in the words of Henry David Thoreau, live of quiet desperation.

    The movie is episodic=, not plot driven, designed to let these people be seen, as if for the first time.  The vast majority of the cast are actual nomads - they integrate seamlessly into the picture, and Zhao has coaxed gentle non-performances from them.  McDormand, as I said, vanishes into he role, as does David Strathairn in a small supporting turn.  Nomadland can be seen on Hulu, and I strongly recommend it.

    I Care A Lot  is as different a movie from Nomadland as I can imagine, but it is a hoot - a deliciously sardonic black comedy with terrific performances by Rosamund Pike and Peter Dinklage.

    Here's the setup:  Pike plays Marla Grayson, a con artist who persuades the courts to declare a number of older people to be incompetent and commit them to live in nursing homes, where she can control their lives and loot their estates.   Then, she targets a woman named Jennifer (Dianne Wiest) - who, it ends up, is somehow connected to a man (Dinklage) who is someone Marla shouldn't have crossed.

    I Care A Lot plays out like a gleeful game of Can You Top This?, with the actors sinking their teeth into their roles with just-over-the-top-enough relish.  I'm not going to tell you anymore than that - just go watch I Care A Lot, now available on Netflix.  Thank me later.  (Note:  the trailer below is NSFW.)

    The two oldies - which I watched on the Criterion streaming channel, which has an enormous collection of old and classic movies - were Klute and the original version of The Manchurian Candidate.

    Klute is the terrific 1971 noir thriller directed by Alan J. Pakula (All The President's Men, The Parallax View), starring Jane Fonda as a Manhattan call girl who a small town Pennsylvania detective, played by Donald Sutherland, believes holds the key to a missing person case he is investigating.  The tension is palpable, the repartee between the leads is undeniable, and there's even Roy Scheider in a small role (shot around the same time as he did his breakout role in The French Connection.)  Klute is terrific seventies-style paranoid filmmaking.  I love it.

    The Manchurian Candidate is just a great film - John Frankenheimer's direction, based on the Richard Condon novel, adapted by George Axelrod, is the very model of a conspiracy thriller.  The story involves the Cold War, sleeper agents, brainwashing, McCarthyism, and political corruption - and yet, in 2021 this 1962 movie seems simultaneously current and prescient.  Frank Sinatra, Laurence Harvey, and especially Angela Lansbury have never been better.  If you've never seen it, go find it … and if you have seen it, watch it again.  (Avoid the 2004 remake.  It is execrable.)

    That's it for this week … Have a good weekend … and I'll see you Monday.

    Stay safe.  Be healthy.