Published on: July 15, 2021
We often talk on MNB about a) the importance of story, and b) the importance of creating community. When a retailer can use a sense of community as a way of telling a true story about a unique connection that actually saved someone's life … well, that's the most powerful kind of narrative. KC explains.
Published on: July 15, 2021
Facebook has followed Amazon's lead in seeking the recusal of Federal Trade Commission (FTC) Lina Khan from any deliberations that could result in the agency filing antitrust cases against the company.
In the recusal petition filed with the FTC yesterday, Facebook argued that "Chair Khan has consistently made public statements not only accusing Facebook of conduct that merits disapproval but specifically expressing her belief that the conduct meets the elements of an antitrust offense … When a new commissioner has already drawn factual and legal conclusions and deemed the target a lawbreaker, due process requires that individual to recuse herself."
The FTC has not commented on the facebook petition, nor the similar one filed two weeks ago by Amazon.
The Journal points out that there is a sense of urgency in the Facebook petition: "The FTC soon must decide whether to file a new antitrust lawsuit against Facebook after a judge threw out the FTC’s previous complaint as legally insufficient. Because of the approaching deadlines in the case—the judge’s June 28 ruling gave the FTC 30 days to file an amended lawsuit—it could force Ms. Khan to confront the recusal issue on an accelerated timeline."
What a bunch of whiney babies.
Here's the deal. When someone is appointed to the FTC, especially as chair, the odds are pretty good that a) they're going to know something about antitrust law and precedent, b) they're going to have an informed opinion about it, and c) they will have expressed themselves on the issues.
So here's what Amazon and Facebook need to do. Knock off the recusal petitions (which, when you think about it, probably only are being filed so they can be made reference to in the inevitable appeals of any decision that goes against them), and start spending some time trying to convince Khan and the FTC that they are wrong in their previously held positions. Make your case. Be persuasive. And stop the freakin' whining.
Their problem isn't that Khan has a previously held and stated position. It's that her previously held and stated position is unfriendly to their prospects. If she'd been supportive of Facebook and Amazon, they'd have no problem with her, and would argue against her recusal.
I think that Khan has a very interesting position on how antitrust needs to be rethought for 21st century realities, and I'm curious to see how the arguments will play out on both sides. Trying to get rid of her (which, by the way, won't work) would deprive the public of what hopefully will be a spirited and nuanced policy discussion.
Maybe I'm just getting cranky, but man, these high tech business people (and their lawyers) are beginning to annoy me.
Published on: July 15, 2021
The Boston Globe this morning reports that Walmart "has struck a deal with warehouse automation company Symbotic that will put the … company’s robots and software inside 25 of Walmart’s regional distribution centers."
According to the story, "Symbotic chief executive Rick Cohen declined to reveal the dollar value of the deal. But he said the Walmart warehouses are massive, with 1.5 million square feet of storage space each, and up to 300,000 unique merchandise items.
"Cohen is also owner of New Hampshire’s C&S Wholesale Grocers, one of the nation’s largest privately held businesses. He founded Symbotic in 2005 to develop better ways to pack and ship merchandise to retail stores.
"'We’ve been in stealth mode for a long time,' said Cohen, 'trying to get this product to be as good as I wanted it to be.' (Walmart has been testing a Symbotic system at one of its Florida warehouses since 2017.)"
The Globe story notes that this is not Walmart's only effort at reducing human labor and improving efficiency via technology at various points in its distribution system, reporting that "John Lert, who co-founded Symbotic and left the company in 2011, is also putting robots to work for Walmart.
"Lert’s current company, Alert Innovation of North Billerica, makes robotic mini-warehouses that are connected on-site to Walmart stores. The facilities use robots to assemble individual customer orders for pickup and delivery. The first of these automated systems was launched in Salem, New Hampshire, in 2019, and in January, Walmart announced plans to add them to dozens more of its stores."
This is all reflective of how big companies with big money are revolutionizing logistics, creating systems that, if they work, potentially will be much better at serving customers at retail. It is all fascinating, but also, I think, a kind of major challenge to companies with fewer resources that may eventually find themselves at a severe disadvantage unless they find ways to define and expand on their own unique advantages.
Published on: July 15, 2021
Bloomberg has an interview with Farhan Siddiqi, interim CEO at FreshDirect and Chief Digital Office at Ahold Delhaize (which acquired FreshDirect earlier this year), in which he talks about how the company plans to compete more effectively with the likes of Amazon and Instacart.
According to the story, "Siddiqi’s growth strategy includes lowering some prices, despite creeping food inflation. He’s doubling down on New York by opening small, automated warehouses in the region to speed deliveries of wine and other popular items. And the retailer is also boosting its product assortment by 25%."
"Fresh Direct is a strong brand," he says, "but people have forgotten about it because of new entrants—these new shiny objects. Fresh Direct was in survival mode for a time. We need to switch it into growth mode, so we created a three-year plan."
You can read the entire interview here.
Published on: July 15, 2021
Bloomberg has a story about how Amazon has considered making an Alexa-powered device that would be wearable and geared to children.
"Codenamed Seeker, the GPS-equipped device would be geared toward kids aged 4 to 12 and could take the form of a wristband, keychain or clip, according to documents reviewed by Bloomberg. The voice-activated wearable would provide access to Amazon’s children-focused content and let parents communicate with and monitor their kids."
The story notes that a similar device from Disney - based on wearables bands it uses at its theme parks - is scheduled to be marketed later this year. There is a possibility that the two companies have been working together, but Bloomberg says that whether there has been a collaboration is "unclear."
The story also points out that while some parents may be concerned about whether such a device would violate their kids' right to privacy, the existence of such a device is likely to raise eyebrows at a time when Amazon's "home and surveillance devices have drawn criticism from privacy advocates."
But I have to be honest … when I read this story, I see all sorts of other applications for an Alexa-powered wearable device. It could resemble a "Star Trek: The Next Generation"-style communicator that would, in a retail setting, could allow for easy communication among employees. In the real world, if the technology is good enough, it could replace the mobile phone.
Once again, Amazon may actually thinking five steps ahead in this game.
Published on: July 15, 2021
With brief, occasional, italicized and sometimes gratuitous commentary…
• Amazon yesterday asked a New York judge "to dismiss a lawsuit by state Attorney General Letitia James claiming the online retailer failed to ensure worker safety at two New York City warehouses as COVID-19 infections surged," Reuters reports.
"James sued Amazon in February over its safety protocols for thousands of workers at a Staten Island fulfillment center and a Queens distribution center, and for allegedly retaliating against two employees who protested against the conditions.
"But at a hearing, a lawyer for Seattle-based Amazon said the federal Occupational Safety and Health Administration had the expertise and authority to oversee workplace safety at private employers, preempting James’ state law claims."
The Attorney General's office replied that "Amazon 'put profits as their primary goal,' and needed a court-appointed safety monitor."
• Bloomberg reports that Amazon is being sued " by the U.S. Consumer Product Safety Commission, which is seeking an order determining that the largest online retailer is legally responsible for defective products sold in its sprawling third-party marketplace.
"The complaint filed on Wednesday says Amazon sold children’s sleepwear that failed to meet federal standards for flammability; some 24,000 carbon monoxide detectors that failed to activate when the harmful gas was present; and 400,000 hair dryers that risked shock and electrocution. Each of the products was sold by one of Amazon’s millions of third-party sellers, and all used a service called Fulfillment By Amazon, in which the company stores and distributes the products on behalf of its sellers."
The story says that "after the CPSC notified Amazon of the defects, the Seattle-based company removed some of the product listings, notified customers that their goods presented a hazard, and offered a refund, but the actions were insufficient, the agency said in its complaint."
In a response, Amazon spokesperson Mary Kate McCarthy said that "customer safety is a top priority and we take prompt action to protect customers when we are aware of a safety concern,” adding, “We are unclear as to why the CPSC … (has) filed a complaint seeking to force us to take actions almost entirely duplicative of those we’ve already taken."
• Reuters reports that Amazon founder-chairman Jeff Bezos, who shortly is scheduled to go to the edge of space on his Blue Origin spacecraft, announced a $200 million donation "to the Smithsonian Institution to boost its Air and Space museum and fund a new education center, the largest gift since the museum's founding in 1846.
"The Smithsonian Institution, which bills itself the world's largest museum and includes 19 U.S. museums and the National Zoo, said $70 million of Bezos' donation will support the renovation of the National Air and Space Museum in Washington and $130 million will help fund the new Bezos Learning Center at the museum."
I am not reflexively against billionaires using their money to further the cause of space exploration - it appeals to the romantic in me, and I think that innovative entrepreneurs are captivated by bringing those impulses to the final frontier. And I'm certainly glad that money is being donated to the Smithsonian, an entity with a deep respect for and fealty to history, science, and American values.
But I cannot help but think of about Bezos' donation in the context of the philanthropy being practiced by his ex-wife Mackenzie Scott, who over the past year has donated more than $8 billion to hundreds of organizations, focusing on nonprofits in the worlds of academia, the arts, racial injustice and domestic violence, especially those that traditionally have been underfunded. One rule of her donations - no strings attached. She doesn't want her name on anything. Which is one of the reasons that some say that she is redefining philanthropy for the 21st century.
Published on: July 15, 2021
With brief, occasional, italicized and sometimes gratuitous commentary…
• Coca-Cola has announced that it is reformulating Coca-Cola Zero Sugar, better known as Coke Zero, to “deliver an even more iconic Coke taste.”
Coke Zero originally was introduced as a diet drink that would closely resemble traditional Coke. Though apparently, in retrospect, not enough.
The announcement is raising concern amount Coke Zero enthusiasts, who remember how in 1985 Coke decided to change the formula of its flagship soda, called it New Coke, and promptly found itself in the middle of one of history's greatest marketing debacles.
• From the Washington Post:
"Hundreds of striking Frito-Lay workers in Kansas are calling on one of the nation’s biggest snack makers to put an end to forced overtime and 84-hour workweeks brought on by a pandemic-era surge in demand.
"Workers at the Topeka plant have been pushed to the brink as the factory revved up operations during the pandemic according to the Bakery, Confectionery, Tobacco Workers and Grain Millers Local 218.
"Many of the factory’s more than 800 workers are working seven days a week and up to 12 hours per shift, with just eight hours between clocking in and clocking out."
The Post reports that "Frito-Lay said it is 'committed to providing a safe and fair workplace' and that the offer it made Local 218 on July 1 'addresses the concerns' that have been raised about the Topeka facility. Under the proposed contract, workers would receive a 4 percent wage increase over the next two years and the workweek would be capped at 60 hours."
• It is a symbol of how the world is changing, and how some retailers are responding to a changed reality.
CNN reports that 16 Nordstrom stores around the country are the first national fashion retailers to sell hijabs, traditional head scarfs commonly worn by Muslim women. The hijabs, which are made from sustainable materials, start at $45; they also are available on Nordstrom's website.
"We look forward to continuing to evolve our assortment, while listening to our employees, customers, brand partners and neighbors along the way," Jen Jackson Brown, EVP and President of Nordstrom Product Group, Nordstrom, Inc., said in a prepared statement. "We hope this collection provides a sense of pride, excitement and confidence for an otherwise underrepresented community of women."
Hilal Ibrahim, the 26-year-old founder of Henna and Hijabs, which manufactures the hijabs, tells CNN that "hijabs in retail are a new concept, and without them women and young girls had to rely on buying scarves that may be too sheer or too small for their intended purpose. She wanted to change that and allow all women looking to use a hijab to walk into a mall and buy one off the shelf."
"I want young women and women of color, and not just Muslim women ... to know that this hijab symbolizes that they can do everything that they want to do," Ibrahim says.
There is a lot to be said for identifying an under-represented community and finding ways to appeal to them - you don't just cater to the community, but also create one that may be tremendously loyal to your brand.
Published on: July 15, 2021
• Replenium announced the hiring of Kate Walker, formerly a Senior Director at Kantar, to be its new Director of Strategic Insights, charged with delivering "strategic ecommerce consultation, as well as data-backed market intelligence on auto-replenishment, to the retail and CPG industries."
Full disclosure: Tom Furphy, who does The Innovation Conversation on MNB, is the CEO of Replenium.
Published on: July 15, 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…
• Here are the US Covid-19 coronavirus numbers: 34,848,068 total cases … 623,838 deaths … and 29,324,300 reported recoveries.
They global numbers: 189,319,604 total cases … 4,076,942 fatalities … and 172,882,565 reported recoveries. (Source.)
• The Centers for Disease Control and Prevention (CDC) says that 67.8 percent of the US population 18 and older has received at least one dose of vaccine, with 59.1 percent bering fully vaccinated.
Published on: July 15, 2021
Content Guy’s Note: Stories in this section are, in my estimation, important and relevant to business. However, they are relegated to this slot because some MNB readers have made clear that they prefer a politics-free MNB; I can't do that because sometimes the news calls out for coverage and commentary, but at least I can make it easy for folks to skip it if they so desire.
• MarketWatch has a story about how "Walmart, Target, Amazon, Wingstop and Nike are some of the names that will benefit when consumers start receiving Child Tax Credit funds this Thursday, according to Cowen.
"The Child Tax Credit, which will be paid in monthly installments of up to $300 for children under age 6 and up to $250 for children between 6 and 17 through the end of the year, will benefit about 39 million Americans.
"Cowen’s Washington Research Group calls the program an 'underappreciated stimulus' that will boost spending across a variety of sectors and consumer companies … The launch of the program coincides with the start of back-to-school shopping and the end of other COVID-related programs."
• The New York Times reports that "Democrats have agreed to include a tax on imports from nations that lack aggressive climate change policies as part of a sweeping $3.5 trillion budget plan stocked with other provisions aimed at ratcheting down fossil fuel pollution in the United States.
"The move to tax imports was made public Wednesday, the same day that the European Union outlined its own proposal for a similar carbon border tax, a novel tool that is designed to protect domestic manufacturing while simultaneously pressuring other countries to reduce the emissions that are warming the planet.
"The two actions in concert suggest that government leaders are turning toward trade policy as a way to attack climate change."
Which suggests that imported food products from some nations will end up being more expensive for consumers. The question that shoppers will have to answer is whether they think this is a policy that is a) worthwhile, and b) effective.
Published on: July 15, 2021
On the subject of people leaving their jobs for a variety of reasons, one MNB reader offered this anecdote:
I'm seeing quite a few department and store managers leaving Shaw's as of late.
Micromanaging from Albertsons seems to be a major issue, but the real issue is lack of any real training program for department heads and assistant department managers. People getting promoted who are nowhere near ready, many departments running without assistant managers, and the good managers, many are burnt out from the stress of the last year and a half. Changes must be made.
On another subject, MNB reader Kim Marsh wrote:
I had to respond to your idea about health insurance companies developing a policy not to cover costs related to Covid for those who chose not to be vaccinated.
That sounds like a great idea until you apply it to other health related issues, such as obesity or smoking which result in all kinds of health related issues. You could make the argument that smoking, for instance, is a choice, and the major health issues that can result from smoking should not be covered by insurance. Obviously, people afflicted with cancer due to smoking are not expected to bare the cost of treatment without insurance, and in fact, with many cancer treatments running into the hundreds of thousands, the burden would be untenable.
The thing that is hard to accept with the anti-vaxxers is the heath risk they pose to others and society in general with their disregard for the severity and possible long term effects of Covid. Other than being harmed by second hand smoke, the risk of which has been largely eliminated by the laws against public smoking, a smoker isn’t going to spread their cancer to the rest of society.
Fair points. But speaking as someone whose mother died in her mid-sixties of lung cancer after 40 years of smoking, I'm actually sympathetic to the argument that maybe people who smoke today ought to be faced with a quit-or-pay-your-own-medical-costs option. When my mom started smoking, people thought it was cool and not much was known about health effects. But anybody who smokes now cannot make that claim - the health impact of smoking has been well-established.
MNB reader Christian Busse wrote:
I’m curious. If it’s true that over 99% of Covid admissions are for individuals who are not vaccinated, is vaccination then a part of their in-hospital treatment prior to discharge? Should it be? Would any patient choose not to be vaccinated?
If it makes medical sense to give those folks a vaccination, I'd be perfectly happy to make ti a condition of treatment.
I'll admit it. I'm a total hard-ass on the subject of vaccinations - and not just for Covid-19.
The other day we took note of a Wall Street Journal report that McDonald's franchisees "are adding emergency child care and other benefits, as many U.S. restaurants are struggling to hire enough workers to run their businesses."
The plan is to "boost hourly pay, give workers paid time off and help cover tuition costs to draw enough workers and improve the Golden Arches’ image as an employer. McDonald’s corporate parent said it is making a multimillion-dollar investment to back the franchisee efforts." A new employee program "aims to “fundamentally change what it means to work at a McDonald’s restaurant."
I commented:
It isn't just restaurants and fast food joints, of course - there are all sort of businesses competing for workers. As I pointed out in my FaceTime this morning, retailers have a choice - they can create worker-centric businesses, knowing that prioritized workers then will make customers their priority. Or, they can do things the old way, which I'm not sure is up to the task of being relevant in 2021 and beyond.
One MNB reader responded:
I guess we must pay everyone a “living wage” just so they can afford a hamburger. But you could get loyalty rewards so maybe after your 10th one you will get one free. No thank you. I think I’ll make my own.
No, people need to be paid a decent wage so they can pay their rent, feed their families, put clothes on their backs, put gas in their cars, and maybe even buy school books for their kids.
We reported the other day that Hy-Vee has hired Dr. Daniel Fick to be its new Chief Medical Officer, who "comes to Hy-Vee from the University of Iowa Carver College of Medicine, where he is a clinical professor of family medicine and part of the provider group for the Executive Health Program at the University of Iowa Hospitals and Clinics, positions he will continue to hold alongside his new role at Hy-Vee."
One MNB reader responded:
This sounds like a medical students nightmare from 20 years ago – flunking out and finding yourself working for a grocer… These times they are a changing.
Sounds ripe for a remake of the old "Northern Exposure" TV series…
On a couple of subjects, MNB reader Steven Ritchey wrote:
I'm turning into an old guy, old school to a degree. I know autonomous vehicles are on the way. There's nothing I could do to stop it, even if I was of a mind to. But, imagine the havoc some hacker could cause should they hack into the computers operating these delivery vehicles. They could cause accidents on purpose, make deliveries to the wrong addresses, which happens now as it is with humans, I don't need a machine I can't talk to delivering me things I didn't order. I know the change is coming, and someday the technology will be seamless and a part of dally life, but the interim could well be pretty ugly.
Just some thoughts from an old guy who still, by choice drives a 30 year old truck with a manual transmission. It's not my daily driver, but I want to know what my daily driver is doing for me, and hang onto some of my youth.
I enjoyed the All Star game as well. I felt like I was seeing some of tomorrows superstars now. I liked miking up players as they were on the field, and kudos to the players who agreed to do that, I know it was a distraction, and I'm sure some of them had to watch their language just a bit. Yes, the uniform jerseys were a bit off putting and I'm glad to see that the 7inning double header rule and the extra inning rule may go away. But, the game is trying to evolved and remain relevant, yet still remain "America's Pastime." Some changes will work, some won't, and there's always going to be people who complain no matter what.
Now if we can decide what to do with the designated hitter rule. I personally like to see the pitchers bat, it adds to the managers decision making and strategy for the game.
For the record, I drive a Mustang convertible with a manual transmission, which, I've joked, I will give up when they pry it from my cold dead fingers.
I may not be able to stop the advance of autonomous cars, but I'm going to avoid using them until I don't have a choice.
As for the All-Star game, here's an email from MNB reader Monte Stowell:
I agree with all 3 of your comments about the BB All Star game, especially the uniforms.
Baseball has some real pressing problems to address: the average game is too long 3 1/2 hours, get rid of of the shift. Second, too many relief pitchers 4-5 per game, lastly, keep the damn batters in the box, etc. Today’s younger sports fans are finding BB too boring. For the record, I am mid 70’s and a lifelong Dodger fan, going back to the Brooklyn Dodgers.
I'm a Mets fan, but if, when I started becoming aware of the world the Dodgers had still been in Brooklyn, I would've been a Dodgers fan, too. (And they are a team for which I continue to have a soft spot in my heart. Except when they're playing the Mets. Which they weren't when the pic below was taken.)
