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    Published on: February 7, 2023

    Yesterday, I did not know how to respond to the MNB reader who suggested that when Sandy Koufax would not pitch in the opening game of the 1965 World Series because it was on Yom Kippur, it was "perhaps the most heinous display of narcissism in the annals of professional sports."  But a bunch of MNB readers did know how to respond … and I have some additional thoughts.

    Published on: February 7, 2023

    Albertsons yesterday announced a new initiative, dubbed Sincerely Health, that it describes as a "digital health and wellness platform … designed to help improve lives by connecting, educating, encouraging and rewarding customers on their health and wellness journey so they can make informed choices regarding food, physical activity, sleep and mindfulness."

    According to the announcement, "Sincerely Health is a platform built in collaboration with healthcare providers, insurance companies and technology organizations who share a broader purpose to improve the health and well-being of every community they serve … The platform will continually evolve based on customer feedback, which will also inform new features, collaborations and enhancements to position Sincerely Health as a trusted and reliable health resource."

    Sincerely Health now is accessible on 16 of its banners’ grocery app and websites,  including Albertsons, Safeway, Vons, Shaw’s, Jewel-Osco, Acme, and Tom Thumb.

    A further description of the service:

    "The Sincerely Health experience begins with a brief questionnaire that measures a customer’s Health Score based on seven dimensions of well-being. The scores are calculated using actuarial science, considering varying lifestyle factors such as age, gender, nutrition, lifestyle choices and mental health.

    "The platform also enables users to link activity trackers such as Apple Health, Fitbit and Google Fit, as well as log their vitals and medication regimen to have better visibility and control over their health and well-being. Customers can then set small achievable goals to improve their Health Score, track their progress and receive actionable insights and rewards for achieving those goals.

    "Sincerely Health also offers an online pharmacy experience, including tools for managing prescriptions, scheduling vaccine appointments and connecting users with general practitioners via convenient telehealth services."

    KC's View:

    In general, I applaud any initiative that tries to connect the dots between food and all the ways in which we're able to track our fitness and wellness.  Part of the problem that I think a lot of consumers have is that there is a ton of data, myriad ways to compile it, and yet some level of confusion exists about how to turn data into something actionable.

    If that's part of the goal here, that's a good thing.  The fact is that it also will give Albertsons a lot of data to use in figuring out to be both relevant and resonant to its shoppers, but as long as it isn't creepy intrusive, that's also a good thing.

    Published on: February 7, 2023

    The Information reports that the Federal Trade Commission (FTC) is bringing in outside economists to assess Amazon's proposed $3.9 billion acquisition of  OneMedical.

    The story says that the FTC has not made a decision whether to sue to stop the purchase, but that as it pulls together relevant information, staffers are making preparations "to file and litigate the case."

    Amazon's purchase of 1Life Healthcare Inc., which operates under the name One Medical, would give the company control of a company that provides membership-based primary healthcare services to employees for more than 8,000 companies in a dozen major US markets.  This is Amazon's third largest acquisition, after Whole Foods ($13.7 billion in 2017) and MGM ($8.5 billion in 2022).

    The story breaks as it also has been reported that the FTC is considering the filing of a broader antitrust suit against Amazon that would challenge a number of its business practices as being anticompetitive.

    KC's View:

    Remember how last year there were a bunch of streaming series about all the various travails at Theranos, Uber and WeWork?   Seems like a pretty good bet that somewhere a streaming service - not Amazon prime Video - is putting together a series that looks at Amazon's recent history.  They'll probably wait to go intro production until they have a sense of the denouement, but this is the stuff of great corporate drama.  (I'd love to be in that writers' room.)

    The question is what the title should be.

    Always Day One.  Or, Too Close To The Sun?

    Published on: February 7, 2023

    Foodcellar Market, a two-store independent on Long Island in New York, announced that it is the first retailer to implement Instacart’s Scan & Pay technology, allowing customers to scan items and then pay for them using their mobile phones.

    These in-store purchases then will be linked to their online Instacart accounts, which will facilitate the building of shopping lists and repurchase preferred products - the process sis all part of Instacart's Connected Stores platform.

    “At Foodcellar Market, we know that our customers’ time is precious, and we're dedicated to ensuring that every moment they spend with us is enjoyable and efficient,” Foodcellar Market co-founder Metin Mangut said in a prepared statement. “Our customers have shared their surprise at how easy it is to use Scan & Pay; there's no need to download an app or learn complicated technology. We’ve been really pleased with the early adoption and our store associates love how Scan & Pay reduces stress for them too.”

    KC's View:

    I'm happy to use this moment to mention that Chris Rogers, Chief Business Officer at Instacart, will be appearing with me, live onstage, during the technology innovation track at the National Grocers Association (NGA) Show in Las Vegas.  We'll be discussing Instacart's evolution, its Connected Stores initiative, and how it is enabling independent retailers to compete against larger, better-resourced entities.

    And yes … I know that any longtime MNB reader will read about an Instacart exec appearing with me onstage and immediately will go to a window to see if pigs are flying.  Or check a weather app to see if hell has frozen over.

    All is good … and I cannot tell you how much I'm looking forward to Sunday, February 26 … this session will be part of a packed tech/innovation track agenda that I think will be filled with energy and illumination.

    Published on: February 7, 2023

    Fascinating piece in The Street analyzing the proposed Kroger acquisition of Albertsons.

    First of all, it stipulates that "in retail, bigger almost always equals better. That might not be true in niche specialty markets, but when you move into broad commodities -- like the grocery business -- size matters."

    Then, The Street argues that "inherently, Kroger and Albertsons are small, local players in relation to Walmart, Amazon, and Costco. Merging -- as the two grocery chains are trying to do -- would give them more scale, more buying power, and a bigger network of stores to leverage delivery and loyalty programs against."

    The rationale for the "small local player" observation:  "Kroger has a $32 billion market cap while Albertsons' currently sits at $11.5 billion. Together, the two companies would have a $43.5 billion market cap, a number that's less than 10% of Walmart's $382 billion and a rounding error for Amazon's $1 trillion market cap. Costco "only" has a $228 billion market cap which still makes the potentially combined Kroger and Albertsons a small, regional player in comparison."

    Whether the Kroger-Albertsons combination will lead to lower prices remains to be seen, The Street writes:  "Grocery prices move largely based on buying power and supply chain costs because most Americans have multiple choices when they shop. Yes, there are certain areas where consumers have limited brick-and-mortar choices, but Amazon and Walmart pretty much serve the entire country.

    "Some consumers, of course, want to shop at dedicated grocery chains and a combined Kroger and Albertsons would be a stronger company with improved buying power and greater efficiencies."

    But, The Street suggests, a combined Kroger-Albertsons entity "would still be at a major disadvantage to Amazon, Walmart, and Costco."

    KC's View:

    Which, I think, is precisely the argument that Kroger and Albertsons will be making to federal regulators … that even if it lowers prices, it still will be disadvantaged.

    Published on: February 7, 2023

    The Pittsburgh Post-Gazette reports that Giant Eagle announced that "starting next month, it will stop delivering its weekly ad flyer. Instead, shoppers will have to create a digital account so they can find out what produce and deli meat is on sale. The weekly ad will be delivered to customers’ email.

    "Although customers won’t receive the ad in the mail, Giant Eagle says that printed copies of the weekly ad will be available for customers in the store."

    KC's View:

    In a larger sense, here's what I do not understand.  During the pandemic, pretty much every retailer got out of the print ad flyer business - nobody wanted to touch paper.  They switched to digital, and pretty much every customer switched, too.  Then, as the pandemic receded, many retailers went back to paper … even though they'd already done the hard thing, the thing that made sense for the future.  

    I don't get it.  As a former newspaper reporter, I hate the way in which print is becoming irrelevant, or at the very least inefficient.  But digital allows companies to be more targeted at less expensive.  And yet, so many people went backwards because they're more comfortable with the way things used to be.

    Published on: February 7, 2023

    The Street reports that as Starbucks CEO Howard Schultz prepares to step down from the role for a third time, he is promising " one last major surprise to fans of the brand."

    In an earnings call, Schultz said:  "While Starbucks has launched many successful coffee beverages over the years, my Starbucks journey will come full circle when I return to Milan later this month to introduce something much bigger than any new promotion or beverage … While I was in Italy last summer, I discovered an enduring, transformative new category and platform for the company, unlike anything I had ever experienced. The word I would use to describe it without giving too much away is alchemy.

    "We won't unveil details today, but it will be a game changer, so standby."

    Schultz, who returned to the CEO job for a third time after the retirement of Kevin Johnson, will stay on the board when he cedes the role to Laxman Narasimhan, who was named to the post last October.

    KC's View:

    Let's be clear - Howard Schultz deserves enormous credit for making Starbucks one of retail's great stories, and essentially inventing a category.

    But … since he as named incoming CEO last October, Laxman Narasimhan has been virtually invisible to the outside world.  I wonder how many CEOs would take a top job in which they'd have to hang around six months before actually being allowed to do the job.

    And now, with this "game changer," Schultz - in my mind, at least - confirms that whatever he says about his dedication to the company, it is really all about him.  This is his surprise, his transformative platform, his alchemy.  This is all about ego … and if Schultz had any class at all, he would want Narasimhan to be in a position to take the credit and to start his tenure with a transformative move.

    This is venti narcissism, with three shots of hubris.

    Published on: February 7, 2023 reports that convenience store chain Sheetz has ended a policy that employees felt was discriminatory against people with dental issues.

    According to the story, the policy said that "applicants with missing, broken, or discolored teeth were not eligible for employment" because those hires would not be able to comply with the company's "smile policy," which requires that frontline workers greet customers with a "warm and welcoming smile."

    The policy got a lot of attention in the media when one woman said she lost her job after her abusive husband knocked out her teeth.

    The story says that "Sheetz officials issued a statement saying that the company's culture is centered on respect and inclusivity, and the smile policy was found to be inconsistent with these values. The company states it is now committed to ensuring all policies are equitable and celebrate the diversity of its employees."

    KC's View:

    I'm sure the policy wasn't meant to be discriminatory, and sometimes certain results can't be foreseen.

    I just hope that abusive husband's ass is in jail, and that it stays there for a long, long time.  

    Published on: February 7, 2023

    • reports that Wegmans "is piloting a new shopping system aimed at replacing its discontinued self-checkout app, SCAN. The grocer is testing Shopic, an artificial intelligence-powered 'frictionless' shopping system in stores in the Buffalo and Rochester areas.

    "The system consists of a rectangular device that attaches to the top of a shopping cart and has a long bar equipped with cameras and sensors. As customers shop, the computer identifies and logs each product, giving a running price total and making adjustments as products are removed."

    The story notes that "Wegmans discontinued its SCAN app due to a high theft rate, and the Smart Shopping Cart system is expected to solve the issue by preventing shoplifting."

    •  From CNBC, a story about how one of Amazon's "key air cargo operators" says that "the e-commerce giant is scaling back on flights this year, citing lower demand and slower economic growth.

    "Air Transport Services Group, which runs a significant portion of Amazon’s air cargo fleet, said it expects to operate Boeing 767 freighters dedicated to servicing Amazon and DHL at reduced schedules and less flight time per aircraft."

    The story says that "air cargo rates, which surged in recent years due to port congestion and high demand for fast deliveries, have slumped. The Baltic Air Freight Index was down more than 33% on Jan. 30 from a year earlier. The International Air Transport Association said last month that air cargo demand in November was down nearly 14% from the year-ago period, while capacity fell 1.9%."

    Published on: February 7, 2023

    With brief, occasional, italicized and sometimes gratuitous commentary…

    •  Food & Wine reports that Subway is adding meat slicers to its 20,000 stores as fast as it can acquire the equipment, which the company said is harder than one would think.

    Subway apparently is one of the few sandwich shops that has not sliced meat on site; meats always have been sliced in a central location and shipped to stores.  " But as prices for almost everything have continued to increase — or as essentials have been in short supply — Subway execs say that the on-site slicers will allow them to save money on shipping costs, and because the restaurants will be using unsliced meats, they may be able to use less-expensive vendors," Food & Wine writes.

    However, the story also notes that "Subway still isn’t going full Jersey Mike’s: while that chain slices its meat to order, Subway plans on slicing in the mornings and in the afternoons. To start, the restaurants will be slicing their own ham, pepperoni, salami, and turkey."

    It is interesting to me that this decision seems to have nothing to do with freshness or quality - it all has to do with speed and cost.  While those two things are important, if you're in the freakin' food business you ought to make food quality and freshness your number one priority.

    Maybe it isn't surprising that a food business that has faced questions about whether its tuna fish actually is made from tuna isn't making freshness and quality a priority.  But this story illustrates to me why a) people shouldn't go to Subway, and b) why nobody in the food business should use it as a role model.  It may be big, but its approach is bad.

    •  From the Wall Street Journal:

    "CVS Health Corp. is close to an agreement to acquire Oak Street Health Inc. for about $10.5 billion including debt, a deal that would rapidly expand the big healthcare company’s footprint of primary-care doctors with a large network of senior-focused clinics, according to people with knowledge of the matter.

    "The companies are discussing a price of about $39 a share, the people said. The deal, if it goes through, could be announced as soon as this week, they said. CVS is scheduled to report earnings on Wednesday."

    •  From National Public Radio:

    "More than 400 food products — including ready-to-eat sandwiches, salads, yogurts and wraps — were recalled due to possible listeria contamination, the Food and Drug Administration announced … The recall by Baltimore-based Fresh Ideation Food Group affects products sold from Jan. 24 to Jan. 30 in Connecticut, Maryland, Massachusetts, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Virginia and Washington, D.C. As of Friday, no illnesses had been reported, according to the company's announcement."

    •  From the Wall Street Journal:

    "Bed Bath & Beyond Inc. has secured investor backing for a more than $1 billion capital raise to stave off bankruptcy and try to turn around its flagging business, people familiar with the matter said.

    "The offering of convertible stock and warrants, coupled with a $100 million additional credit line from one of its lenders, is expected to save the troubled retailer from the near-term chapter 11 filing it has warned about for weeks. Bed Bath & Beyond has received investor commitments to raise $225 million of equity capital initially and the rest of the more than $1 billion offering over time, according to people familiar with the matter."

    Wow.  These folks are jumping on a sinking ship.  They must see something I don't see … though I cannot imagine they see a retailer with long-term viability.