Jim Farley, president and CEO of the Ford Motor Company, gave a presentation to analysts this week in which he detailed the four strategies that the company is employing to differentiate itself and be more competitive. There are, I think, parallels to what retailers need to do to achieve the same ends.
Bloomberg has a story about how "the US consumer spending binge that took hold during the pandemic is breaking down.
"The discretionary spending slump that started last year is delivering a new blow to big US retailers, according to a slew of earnings reports this week. Home Depot Inc. cut its annual profit forecast, citing a customer pullback. Target Corp. and Walmart Inc. warned that recent sales were at their strongest in February but weakened in March and again in April.
"The reports signal rising anxiety about US shoppers, who are forgoing purchases of furniture, apparel and electronics in order to afford basic goods.
"That’s stoking fears of a long-term drag on the economy that some analysts see playing out for years."
Here's how the slowdown is playing out for many supermarkets:
"About 90% of consumers are skimping on grocery bills, only buying what’s absolutely needed and ditching goods such as air fresheners and lawn fertilizer, according to NIQ, formerly known as NielsenIQ. In March, 35% of shoppers were only buying essentials, up three percentage points from October, based on an NIQ survey.
"More than half of Americans are switching to cheaper brands, according to an April survey from Attest. And some 90 million US adults are now struggling to pay for their usual home expenses - higher than after the pandemic hit and millions lost their jobs.
"While some are tightening their belts, others are relying on credit cards and loans to make ends meet. Credit-card balances are growing and carry higher financing rates, adding another headwind for spending."
And yet, when the unemployment numbers come out this week, almost certainly phrases like "stronger than expected" and "indicating persistent strength" will be included in the stories.
That said, the continuing impasse over the raising of the debt ceiling has to be creating enormous anxiety among anyone paying attention and being realistic about what happens if the Republicans and Democrats don't come to an agreement. We'll go off an economic cliff if that happens, and the current conversations about unemployment and inflation and recession may seem quaint in comparison.
The Des Moines Register reports that several Hy-Vee stores in Iowa, Minnesota and South Dakota have been forced to evacuate customers and employees after bomb threats were made against them.
According to the story, law enforcement officials determined that the threats were not credible after sweeping the stores for explosive devices. The calls reportedly have been anonymous and difficult to track.
The Register quotes Nola Aigner Davis, senior communications manager at Hy-Vee, as saying that there is "a growing trend of bomb threats that have been called in to stores across the grocery store industry. Most of the time callers ask for something and 'issue the threat of a bomb if their request is not met,' she said."
This is all about fomenting chaos. I hope that when they catch these cretins, they are met with the full force of the criminal justice system.
"Amazon investors voted against 18 proposals at the company’s annual shareholder meeting Wednesday, opting out of efforts to require Amazon to provide more information on its use of plastics, possible pay disparities and working conditions in its warehouses … One proposal asked Amazon to provide more information about its lobbying efforts to ensure it would address any 'misalignments' between its stated climate goals and its lobbying. Another asked for a report on Amazon’s packaging materials, focusing on how it could reduce its use of plastics.
"Oceana, a nonprofit ocean conservation organization, said in a report Amazon generated 599 million pounds of plastic packaging waste in 2020. Up to 23.5 million pounds of that entered the world’s marine ecosystems, Oceana said.
Amazon’s board of directors argued the report’s calculations were 'seriously flawed' and overestimated the company’s use of plastic. Amazon, the board said, is already working to address plastic waste and support recycling in the industry.
"Investors also voted against proposals regarding working conditions in Amazon’s warehouses, including one that matched the demand for an independent safety audit in the petition Missouri workers delivered to management before Wednesday’s meeting."
The Times writes that "on Monday, a group of corporate employees began urging their colleagues to walk-off the job later this month to show frustration with recent layoffs, Amazon’s return to office mandate and a lack of action on climate change, organizers said. The one-day walkout, slated for May 31, hinges on at least 1,000 employees from Amazon’s Seattle headquarters agreeing to participate.
"On Tuesday, workers at an Amazon warehouse in Missouri delivered a petition to management with 400 employee signatures asking the company to slow the pace of work, increase break times and conduct an independent safety audit of its facilities.
"That same day, protesters gathered outside Amazon’s corporate offices in South Lake Union, calling on the company to decrease pollution from its network of delivery vans. The group of activist organizations asked Amazon to commit to zero-emissions deliveries by 2030."
CEO Andy Jassy reportedly was willing to address how Amazon is working to improve customer service and shipping speed, but not the labor issues that, if not quite roiling the company, certainly must be a distraction, throwing into question Amazon's stated "world's best employer" intentions.
Seems to me, though, that these things are connected, and you cannot focus on one without dealing with the other. Head-on. It sometimes feels like the two sides exist in different universes, and that's not doing anybody any good.
The Wall Street Journal this morning spotlights data from the US Census Bureau that points to the "changing composition of US families."
According to the story, "Americans in same-sex marriages and partnerships account for about 1% of households … Same-sex married couples made up 0.5% of the nation’s nearly 127 million households in 2020, five years after the Supreme Court legalized such unions nationwide. Same-sex unmarried partners made up 0.4%."
The Journal goes on: "Opposite-sex married couples made up 46% and opposite-sex unmarried partners made up 7%. About 28% of households were occupied by someone living alone, up from about 27% in 2010. Most of the remaining 19% lived with relatives in a variety of household types. The share of opposite-sex married couples dropped 2 percentage points from 2010, while other types grew slightly."
Since "US families" and "American households" sort of describes precisely the folks to whom retailers need to cater, this evolution matters.
These shifts are only going to gain momentum in coming years, I would guess. As Abraham Lincoln once said, " I am a slow walker, but I never walk backwards."
• Kroger announced that it plans to add 500 "smart screens" at some 500 of its stores, which Cara Pratt, SVP at Kroger Precision Marketing, says will further enable the company to bring "the best of digital experiences directly into our retail stores, while integrating with our 84.51° data science platform to create an engaging and valuable experience for our customers, associates and brands.”
The expansion comes after a successful three-year pilot with Cooler Screens that integrated retail media offerings with in-store activities.
• The Los Angeles Times reports that "Walmart has agreed to pay $500,000 to settle allegations that it illegally sold brass knuckles to Californians through its website, according to state Atty. Gen. Rob Bonta.
"Bonta announced in a news release Tuesday that Walmart will be required to pay the California Department of Justice and the Merced County, Ventura County and Yolo County district attorneys’ offices $125,000 each in civil penalties.
"The retailer is also prohibited from selling brass knuckles on its website and will be required to stop third-party sellers from selling illegal weapons on its platform."
With brief, occasional, italicized and sometimes gratuitous commentary…
• Advertising Age reports that "The North Face does not plan to bow to boycott pressure it is facing in the wake of an LGBTQ+ campaign. After the outdoors brand released its new Pride month collection this week, and included a video featuring drag queen Pattie Gonia, some consumers complained on social media. But The North Face responded with a message of inclusivity.
"'The North Face has always believed the outdoors should be a welcoming, equitable and safe place for all,' the brand said in a statement, noting that the Summer of Pride series is now in its second year and has helped 'individuals from all backgrounds' experience the outdoors. 'Creating community and belonging in the outdoors is a core part of our values and is needed now more than ever. We stand with those who support our vision for a more inclusive outdoor industry'."
The story notes that "many outdoors brands have been working to foster a more inclusive and accessible environment in recent years. For example, The North Face, along with competitors Patagonia and Arc’teryx, is involved with Opening Up the Outdoors, a movement to make the outdoors safer for everyone."
Tina Turner, the music legend who brought us such enduring and classic hits as "Private Dancer," What's Love Got To Do With It?" and an extraordinary cover of Creedence Clearwater Revival’s “Proud Mary," has passed away after a long illness. She was 83.
To do her justice, here's an excerpt from the Rolling Stoneappreciation, which described her as "the raspy-voiced fireball who overcame domestic abuse and industry ambivalence to emerge as one of rock and soul’s brassiest, most rousing and most inspirational performers:"
"Starting with her performances with her ex-husband Ike, Turner injected an uninhibited, volcanic stage presence into pop. Even with choreographed backup singers — both with Ike and during her own career — Turner never seemed reined in. Her influence on rock, R&B, and soul singing and performance was also immeasurable. Her delivery influenced everyone from Mick Jagger to Mary J. Blige, and her high-energy stage presence (topped with an array of gravity-defying wigs) was passed down to Janet Jackson and Beyoncé. Turner’s message — one that resounded with generations of women — was that she could hold her own onstage against any man."
Yesterday we took note of a Wall Street Journal report that Target plans to remove some of the items it brought in to help customers celebrate Pride Month, and will move remaining displays to less visible parts of its stores, as it reacts to a backlash that caused some of its employees to feel unsafe. Target has been doing Pride Month each June for more than a decade, but this is the first time that the LGBTQ+ themed promotion has prompted this kind of backlash - people confronting workers in stores, knocking down Pride merchandise displays and putting threatening posts on social media with video from inside stores.
I commented, in part:
Well, the fact that Target is getting grief for this in 2023 after having had such offerings for more than a decade proves one thing: not everybody is capable of personal growth, and that there are some folks who would like to take this country back to good old days that weren't good for a lot of people, and that didn't say much good about qualities such as tolerance, acceptance and love.
I don't blame Target for making this decision. It has to protect its employees and other customers from this crap. But the people who are confronting employees, knocking down displays and making threats online (which is what cowards do, because they find solace in anonymity and the embrace of their fellow bigots) ought to be arrested, charged and prosecuted.
As I've said here before, I believe in a "no tolerance" policy for people (organized and not) who shoplift and commit vandalism in stores - stopping small crimes is one way to prevent larger crimes. And stopping these kinds of hate-inspired crimes - which is what these are - also requires a no tolerance policy.
MNB reader David Spawn responded:
This is a very sad story to read. I worked for Target for 7 years and was always very proud of their stance in supporting Pride across the company, both in the store and in the workplace. As an out gay man, I truly felt that Target supported me and wanted to create a comfortable and inclusive environment through their broad support of Pride well before it was common among other companies.
We have really hit a low point as a society when it is acceptable to resort to such cowardly acts that make people feel concerned for their personal safety. What I fear most is that these low points will only continue to get lower until there is broader support from all facets of society that behavior that purposefully threatens others is unacceptable.
The problem is that in some circles, not only is this behavior acceptable, but actually a badge of honor. In reality, of course, honor is something with which these people have no actual familiarity.
Another MNB reader wrote:
For every action, there is an equal and opposite reaction. These people are merely reacting to unpleasant things being constantly crammed down their throats.
Maybe. But that doesn’t make their actions more legal or less reprehensible.
And what is "unpleasant?" A retailer marketing to people who aren't like you? Maybe we all ought to remember this passage from Scripture:
"Truly, I say to you, as you did it to one of the least of these my brothers, you did it to me." - Matthew 25:40
I would remind you that Target's approach has been dictated by a desire to be a smart retailer.
Fortune has an interview with CEO Brian Cornell in which he makes the point that "I think the facts are in, the results for us, and the things we’ve done from a DE&I standpoint, it’s adding value, it’s helping us drive sales, it’s building greater engagement with both our teams and our guests. And those are just the right things for our business today … I’m really proud of the work we’ve done in the DE&I space. Now, the fact that we talked about almost 2,000 stores, well, half of those stores are run by female store directors. Over 40% of our store directors are diverse. That component is so important, but it also reflects the consumer we serve. And when your team, your leadership represents the consumer you serve, I think good things happen. So I can see the benefits for our shareholders. I know that focus on diversity and inclusion and equity has fueled much of our growth over the last nine years."
One other note on this. Apparently there was a story making its way across social media accusing the person who manufactured some of the Pride products of being a Satanist, which is the primary reason that Target was being targeted.
I did a little checking online, and the person being accused says that while he does manufacture some items that reference Satan, they all are tongue-in-cheek, and, in fact, none of those items were being sold by Target. Plus, he says, he doesn't believe in Satan. Also doesn't believe in God. And thinks of the Bible as a "metaphor."
In other words, I think this is largely manufactured outrage. Which, unfortunately, can be as potent as outrage about things that a) are real, and b) really matter. The question is whether people will be quiet about it, or will they fight back against false and deliberately provocative outrage.
I'd like to think that, in the words of poet Amanda Gorman,
"We've learned that quiet isn't always peace
And the norms and notions of what 'just is'
Isn't always justice."
Michael Sansolo wrote his column this week about how, while new rules have speeded up major league baseball games, it is incumbent on ballparks to make sure they have either enough people or the right technology - or both - so that concessions can get people in and out and back to their seats efficiently enough so they don't miss much action.
MNB reader Wayne Redfearn responded:
Michael Sansolo makes a very good point. MLB has established a time limit of 2 minutes and 30 seconds between innings. This makes is difficult to use the restrooms much less order, receive and pay for food, add condiments and return to your seat between innings. I see several solutions to address this problem… allow patrons to bring their own food and snacks into the ballpark (Anaheim Stadium allows this), hire more well-trained personnel at refreshment stands, pre-order food at refreshment stands for quick pick up, offer more pre-made food for quick pickup and hire more personnel to sell food in the stands as was once done at ballparks. The new rule changes are great!
And from another reader:
Live TV monitors in concession lines and the restrooms isn’t such a bad idea either!
Got this email from MNB reader Mike Moon about the manufacturer claim that electromagnetic interference is forcing them to eliminate AM radio from their electric vehicles:
The issue with AM radio in Electric Vehicles isn't the inbound AM signals that are all around us, or the radio itself. It's the electromagnetic interference coming from the EV's electric motors that turns AM radios into a static-y, hummy mess (ever had the AM radio on and drove underneath a power line? same issue). You'd think that with all the technology advancements we enjoy, that they could figure out how to fix this, but it's not as easy as it sounds.
On another subject, from MNB reader Jerome Schindler:
Have to give Target 5 stars for this one:
I needed paper coffee filters for a 4-6 cup coffee maker. I stopped at Target near me, just going by, not a special trip.
That item was out of stock. Later in the day, on the chance that they might have been in the back room and not on the shelf, I ordered them on-line for pick-up at that store.
Sure enough, the order went through. A couple hours later I got an email saying they were out of stock at that location, but they were available at a more distant store. But then they offered the alternative of having them shipped to my home at no cost, arriving in 2 days All of that for a $4 order (free on-line order minimum is usually $35).
The New York Times reported this week that the pandemic-era practice of making menus available to restaurant patrons via the use of mobile devices to scan QR codes seems to be ending.
I never really minded the QR codes, though there is something tactile about holding an actual menu in one's hands - in some cases, it can actually be part of the experience. I do think that there remains a use for QR codes in such situations, like for offering nutrition information or details about daily specials. (Though a well-informed and opinionated member of the wait staff can be invaluable in such cases.)
I also think there is the opportunity for using QR codes for immediate feedback purposes - there is a company called RealTimeFeedback.com that is doing this in a number of restaurants and other venues, and I think the technology has a lot of potential for supermarkets.
One MNB reader responded:
As we are so "socially connected" by digital devices, I made a self-imposed rule of not being digitally connected when I go out to a restaurant with my wife, family, or friends. The reason...just look around at those other tables. Heads down, zoned in on the phones.
Like you, working from home for years (pre-pandemic) I yearn to be able to focus and pay attention to those I am physically with in the moment. You know like actually having some "Eye Contact". So leaving the cell phone in the car or at home, and even not wearing my iWatch is so refreshing even if just for an hour or so.
But...this has been an issue with my ability to get a physical menu since the pandemic. Most have either got me one or actually let me use their phone or if someone I'm dining with has one.
So let's bring back the menus, and do the phone stack at the table (the loser buys the wine), gazing thoughtfully into the eyes of your wife/date, have a meaningful conversation with your friends and families, and influence better behavior to our kids/grandkids.
By the way, did you read that the Surgeon General, Dr. Vivek H. Murthy, issued a powerful public advisory yesterday warning of the considerable risks that social media poses to young people’s mental health.
I did. And I think he makes an excellent point.
Responding to my rant against airlines that are starting to charge for paper boarding passes, one MNB reader wrote:
It is ridiculous with the airlines and their fees. Price of tickets going up with less leg room and services. Here is one that has just happened to me. My wife and her father were going to go to California to visit some family. Family emergency forced a cancellation of the trip. My wife received credit for the tickets to use on another flight, however she also paid for a bag to check and seats with additional leg room (over $350) and that is not refundable. They are making ridiculous sums of money and constantly look for government bailouts. They need to be more closely monitored for sure as tickets shouldn’t be more than double than what they were.
I could be a little more eloquent, but definitely a little emotional on this one.
We took note yesterday of this Axios story:
"José Andrés, celebrity chef and founder of World Central Kitchen, and George Washington University are launching a research institute focused on the intersection of food production and climate change … The Global Food Institute (GFI), being announced today, identifies the warming planet as one of the greatest challenges facing the global food system."
"The world we live in today is confronted by a wide range of complex crises, and the global food system sits at the heart of each of them,” Andrés tells Axios in a statement.
Anyone who doesn't think that the climate crisis won't have an enormous impact on our food supply is either blind, or just refuses to see.
Prompting one MNB reader to write:
Your statement reminded me of the saying that there are none so blind as those who will not see. Lots of that going around these days.
Yes, there is.
I actually was curious about the origin of that statement, so I went online and discovered that English playwright/poet John Heywood is credited with writing it in 1546.
Before that, there was the Bible verse, Jeremiah 5:21:
‘Hear now this, O foolish people, and without understanding; which have eyes, and see not; which have ears, and hear not’.
British satirist Jonathan Swift use dit in his "polite Conversation" in 1738.
And singer Ray Stevens used the line, "There is none so blind as he who will not see,” in his 1970 song, “Everything Is Beautiful.”
All of which probably is more than you needed or wanted to know. But they had me at Ray Stevens, who had other memorable hits such as "Along Came Jones," "Mr. Businessman," "Misty," and, of course, my personal favorite, "Would Jesus Wear A Rolex?"
EMBED VIDEO: https://youtu.be/HeakHnfjXpg
Finally, on Tuesday I did a FaceTime video following up on both a story about SNAP benefits being reduced and an MNB reader who decried the decision by quoting Hubert Humphrey. Here is what I said:
MNB reader Bob Wheatley was kind enough to write:
Congratulations to you for one of the best and most poignant and powerful posts you’ve published.
Thanks. After 21 years, it is nice to get one right every once in a while.