business news in context, analysis with attitude

Published on: February 24, 2022

Amazon-owned Whole Foods has opened its first store using the Just-Walk-Out technology that the  company pioneered with its Amazon Go stores almost a half-dozen years ago.

The 21,500 square foot store, in the Glover Park neighborhood in Washington, DC (just north of Georgetown), is a little smaller that the 25,000 square foot Amazon Fresh unit that uses the technology that was opened last year, and much bigger than the Amazon Go stores, which tend to be smaller than 2,500 square feet in size.

Axios writes that the new Whole Foods "demonstrates how much autonomous shopping has improved."

One apparent difference between the new store and the original Amazon Go stores is that in the original iteration, one had to have the Amazon Go app to enter the store, at which point you could take any product, put it in your pocket or a bag, and then leave the store, with a receipt delivered to your smart phone shortly thereafter;  in the Whole Foods store, there are more options:  Axios writes that customers "can scan a QR code from their Amazon or Whole Foods app, their palm, or an Amazon-linked credit or debit card."

The technology is driven by "cameras, sensors and software similar to self-driving cars to track people and products throughout the store."

Shoppers also can avail themselves of more traditional "self-checkout lanes, where cash, gift cards and supplemental nutrition program benefits are accepted," Axios writes.

Business Insider notes that "Amazon has attempted to meld its own technology with the grocery industry for years … In 2021, Insider reviewed internal documents revealing that the online giant predicted expenses around 'Just Walk Out' to drop 75% between 2020 and 2023. Currently, Amazon also runs 'Just Walk Out' technology at select Hudson stores, Resorts World Las Vegas, and the TD Garden area in Boston.

"Whole Foods also has plans to open a second store with 'Just Walk Out' technology in Sherman Oaks, California. The California store is also slated to open in 2022."

Published on: February 24, 2022

Content Guys Note:  Over the years, I have expressed in this space a certain skepticism about many retailers' inclination to use customer data to create a more targeted approach to marketing, a more finely tuned retail experience, and a relationship with shoppers that goes beyond the transactional.  The actionable data is there … it is all about whether retailers actually act upon it.

I've recently had a series of conversations with a friend, Tom Fuyala, CEO of the 11Ants Analytics Group out of New Zealand, in which I've been testing out my continued cynicism and he's be reassuring me about what's possible (if not always implemented).  I persuaded Tom to spend some time via Zoom discussing the subject, which wasn't as much fun as a trip to Auckland might have been but was informative nonetheless.

I hope you find out conversation to be illuminating.

If you'd like to listen to an audio podcast version of this conversation, click below.

Published on: February 24, 2022

IRI is out with a new study, conducted with SeeHer, which describes itself as "the largest global movement for accurate representation of women and girls in advertising and media," concluding that advertising campaigns that "more accurately portray women and girls" translate into "more meaningful growth for marketers."

According to the study, "Ads with GEM (Gender Equality Measure) scores above the baseline overall delivered 60% improved sales performance on average across gender, language, race and ethnicity."

The study goes on:  "Creatives that meet or exceed GEM baseline saw sales lift increase for Black women by 80% and 41% for Hispanic women … Equality also is an important issue for men, with 73% citing it “personally important" … Results show that accurate portrayal of women leads to a 120% sales lift among Hispanic men and a 196% lift among Black men."

“The results of our 2021 study show a clear and significant sales lift for ads that accurately portray diverse women, proving that meeting consumers’ rising expectations of gender equality in advertising is critical for brands seeking growth,” said Jennifer Pelino, executive vice president of Global Media Solutions for IRI, in a prepared statement.  She added, "Equality starts with cultural perceptions and media plays a key role in ensuring appropriate character depiction, but quantitative evaluation is key to moving the industry in an upward direction.”

Published on: February 24, 2022

CNN has a story about the delivery disconnect that exists between customers who rely on it and restaurants that find themselves dependent on it to maintain viability.

Here's how CNN frames the story:

"Restaurants have a delivery problem.

"Early in the pandemic, when eateries were forced to shut their doors, delivery became a lifeline. Restaurant operators scrambled to set up delivery channels from scratch or promote ones that previously existed.

"But there was a reason that many restaurants hadn’t focused on delivery before the pandemic: Delivery is a pain. It’s expensive, since restaurants have to hire drivers or outsource to third-party providers like DoorDash or Grubhub, which charge a fee that cuts into their already razor-thin margins. It’s also stressful for employees, who must balance taking care of in-store customers while filling increasing numbers of to-go orders. And when deliveries go wrong, the restaurants take the blame, whether or not it’s their fault.

"Customers, on the other hand, don’t see it that way. Delivery is convenient. It’s usually pretty fast, and perhaps best of all, they can do it through an app - without ever having to talk to a person."

CNN points out that "delivery rates remain higher now than they were pre-Covid. In 2019, delivery accounted for about 7% of total US restaurant sales, according to Euromonitor International. After a spike in 2020, it settled at nearly 9% in 2021, according to Euromonitor."

The bottom line:  "Whether restaurant owners like it or not, delivery is here to stay."

At the same time, Fast Company reports on the systemic technology issues that plague DoorDash, writing that "system crashes can be crippling for DoorDash’s army of delivery drivers - called dashers - whose every move is dictated by algorithms. And they affect customers whose orders are either lost or delivered late and cold.

The story goes on:  "Dashers are paid by the delivery, not by the hour. So time lost to outages means money lost. And in addition to dealing with outages, dashers using the company’s Android app have long had to contend with glitches, such as missing delivery information, which further cut into their ability to make deliveries, and get paid.

"DoorDash acknowledges that there have been more issues with its Android app than the iOS version, although the company claims that performance has improved in recent months. The company did not address the issue of systemwide outages, despite multiple requests for comment."

Published on: February 24, 2022

The Dallas Morning News reports that The Container Store chose 2-22-22 - which it called "a perfectly organized date" - to launch a new marketing campaign and logo.

The new national marketing campaign has the tagline, “Welcome to the organization.”

CEO Satish Malhotra says he is restating the company’s mission to say it can “transform lives through the power of organization.”  Malhotra, who has been CEO for about a year, tells the News that "in order to truly understand, I had to experience it myself."  Organization, he says, "brought joy to our family ... I know where my tools are in the garage."

The News writes that "the campaign includes a new logo design that has three nested baskets in a smile shape, which is a nod to its most devoted customers, who say the store is their 'happy place'."

Published on: February 24, 2022

From the Wall Street Journal:

"Among discerning drinkers, craft beer’s hot new thing is a cold, crisp lager that couldn’t be further from long-popular IPAs. The beer that Budweiser and Miller made famous in the U.S. has gone artisanal.

"The bestselling beers tend to be mass-produced lagers, the kinds long associated with ballgames and barbecues. They’re also the brews that picky drinkers often regard as watery and low on flavor, beer experts say. But lagers are now important for more brewers and for a wider range of customers, says Bart Watson, chief economist at the Brewers Association, which counts more than 5,300 craft breweries as members."

Will Golden, co-founder of Austin Beerworks in Austin, Texas, tells the Journal that "craft microbreweries weren’t very interested in lagers during the last decade because they needed to turn out beers faster than a good lager takes to brew.

"But with craft beer becoming normal, beer connoisseurs now view lagers as a measure of quality, he says. Making one that is clean and refreshing is considered a mark of craftsmanship … Lagers, which range from the bright yellow pilsner to the darker, full-bodied Märzen, are produced at low temperatures. The slow fermentation and refrigeration process reduces the speed of yeast activity during conditioning, creating a crisp flavor and brilliant color. But keeping the beer in tanks for the weeks it takes to make a lager costs more time and money. Add rising costs of labor, packaging and raw ingredients like malt—for which mega-breweries negotiate lower prices—and more lager means more risk and cost for microbreweries."

Published on: February 24, 2022

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…

•  The US Covid-19 coronavirus numbers:  80,372,404 total cases … 966,530 deaths … 52,453,562 reported recoveries.

The global numbers:  430,711,641 total cases … 5,939,723 fatalities … and 359,459,342 reported recoveries.  (Source.)

•  The Centers for Disease control and Prevention (CDC) says that 76.3 percent of the US population has received at least one dose of vaccine … 64.8 percent is fully vaccinated … and 43.4 percent has received a vaccine booster dose.

The CDC also says that 49.9 percent of the eligible population has not received a vaccine booster dose.

•  From Axios this morning:

"The spread of an even more transmissible Omicron subvariant is making some experts nervous as states lift mandates … The new subvariant is a 'reminder we very well may not be done here and there may be others coming,' Matt Craven, a partner at McKinsey who specializes in public health and infectious disease, said yesterday during a U.S. Chamber of Commerce event.

"The WHO (World Health Organization) reiterated this week that the subvariant, BA.2, is a 'variant of concern' while also saying it would continue to be classified as Omicron … The subvariant is believed to be 30% more transmissible than the original strain, WHO reported — but may not cause more severe disease than the original Omicron strain."

However, Axios also notes that "COVID case rates remained in freefall over the last two weeks … The U.S. is now averaging roughly 82,000 new COVID cases per day — a 64% drop over the past two weeks.  Only one state, Washington, has reached transmission considered "low" at six cases per 100,000 people."

The story points out that "there still are roughly 2,000 deaths from COVID in the U.S. a day. But that's down 24% from two weeks ago."

Published on: February 24, 2022

•  From Bloomberg:

"Walmart Inc. is expanding its partnership with live-shopping platform Talkshoplive, adding regularly scheduled content in a bid to entice more customers to buy products through online videos.

"The programming schedule through March includes shows on makeup, dog food and toys, the companies said in a statement Tuesday. That builds on February content about baby products and Black-founded brands, as well as four live shows during the holiday season with celebrities including Drew Barrymore and Rachael Ray. The videos appear on Walmart’s website … With the expanded programming deal, Walmart is extending its foray into so-called streaming e-commerce, which intertwines video, social media and celebrities to prod consumers into making purchases. It’s a sign that live selling, already popular in Asia, is gaining ground in the U.S."

Published on: February 24, 2022

•  From the New York Times this morning:

"The National Labor Relations Board dealt a blow to Starbucks’s legal strategy in response to a growing union campaign on Wednesday, rejecting the company’s argument that workers seeking to unionize in a geographic area must vote in a single union election.

"In a ruling involving an election in Mesa, Ariz., the board noted the longstanding presumption that a single store is an appropriate unit for a vote — as union supporters have insisted.

"Starbucks workers at more than 100 stores nationwide have filed for union elections and workers at two stores in Buffalo have already unionized.

"Unions typically prefer smaller elections, which tend to increase their chances of winning, albeit on a smaller scale. Workers United, the union seeking to represent Starbucks employees, has complained that Starbucks has repeatedly resisted store-by-store elections despite gaining little traction on the issue as a way to delay votes and stop the union’s momentum.  Starbucks has argued that the elections should be marketwide because employees can work at multiple locations and because the stores in a market are managed as a relatively cohesive unit. It has made this case in its requests to appeal labor board decisions ordering elections on a store-by-store basis in Buffalo and Mesa, and in other filings related to union elections around the country."

•  From USA Today this morning:

"Target shoppers, this could be a game changer.

"In the future, you might be able to add a Starbucks drink to your Target Drive Up order and complete store returns curbside.

"The Minneapolis-based retailer announced Wednesday that it plans to start 'testing the option for guests in select markets to add a Starbucks order or make a return' with its curbside service through the Target app … The test is expected to begin in the fall."

“Our guests continue to tell us they love the ease and convenience of Drive Up, and they have been asking us to add even more of the Target experience to the service," Mark Schindele, Target’s chief stores officer, said in a statement. "Adding a Starbucks order and easy returns, while expanding our backup item options, will give guests even more of what they love about shopping at Target, quickly and easily."

Published on: February 24, 2022

…will return.