Last week I did a FaceTime about how Best Buy's CEO Corie Barry recently complained about how people spending money on Taylor Swift concert tickets and merchandise were hurting the retailer's bottom line. Not only do I think this is nonsense, but I also believe that this is a strong indication that Barry may not understand consumer priorities and what retailers need to do to appeal to them. (I also visited a nearby Best Buy. I wasn't encouraged about Best Buy's strategy.)
MNB reader Craig Espelien wrote:
Retail is simple - and endlessly complex. Best Buy seems to have forgotten both…
The simple: there are only four levers to pull for any retail business to improve performance:
• Do things that drive top line sales (Hint: there are only two ways this happens)
Increase traffic (new and more people).
• Increase basket (people who shop buy more on each trip).
• Do things that drive bottom line profitability.
• Do things that aggressively manage the expense line
The complexity comes in when you dig into them.
Clearly Best Buy has fumbled the first lever of The Simple (and both drivers of it) based on your images, your lack of desire to go there (which matches mine - I think I have been in a Best Buy once about three years ago as we needed an new Internet switch - and I needed it now) and the apparent mis-understanding they have that a customer has a problem they need to solve - which Best Buy could/should be able to do better than their competition.
And, they appear to desire to make the shopping experience more complex rather than dig into the complexity of turning shoppers into buyers.
Clearly, they have become too heavily invested in the way things used to be.
Another MNB reader wrote:
How is someone this ignorant able to become a CEO? What’s the annual salary and bonus amount for this brilliant mind?
MNB reader Mark Brown wrote:
Great analysis! I wonder if she’s heard of CompUsa, Digital City, Radio Shack, etc.
I commented last week about the FTC's accusations that Amazon deleted some emails that were requested by the federal government in its antitrust probe of the company, and pointed out the irony that the Jeff Bezos-owned Washington Post has as its slogan "Democracy Dies In Darkness."
One MNB reader responded:
Perhaps Bezos should engineer a new slogan for Amazon, which should be:
"Truth Hides in Redaction."
Reacting to our piece about PCC closing down a two-year-old store in downtown Seattle, MNB reader CT Rickard wrote:
I think the people at PCC are being too polite as they did not mention the theft involved in Seattle. Nike is closing their downtown store, Macy’s and others. The crime and theft are out of hand (as well as Portland). I don’t doubt the validity of their profits being down, but I don't think that's the complete story, in my opinion.
Last week we referenced a CNBC story about how "it is a particularly prudent time for unionized workers to organize as they enter new contracting periods," though "cumulative wage growth is still faster for nonunionized workers than for unionized workers."
While the chain drug store workers who are staging walkouts all over the country are not unionized, the weakness and impotency of their employers' responses strikes me as setting the table for possible union organizers. And it seems clear to me that a sense of militancy is growing in a number of sectors, and it is going to be important for retailers to get in front of issues that may concern their front line workers.
You can't make the same mistake as CVS, Walgreens and even Starbucks - losing focus on what is happening in stores to the degree that the people enable your success feel that you are completely disconnected from reality and start considering their options.
One MNB reader responded:
While there are many factors that influence the gap between wage growth of union vs. non-union workers, this observation may actually suggest that the free market actually works! The higher wage growth of non-union workers is likely driven in part to the fact that they are not working with a contract that did not anticipate the runaway inflation that followed the pandemic and as such, the wage growth hit as the necessity became real while the union workers may have delayed due to the timing of contract negotiations as suggested in the final paragraph about the UAW.
The Wall Street Journal reported last week that DoorDash "is warning users that not tipping a delivery driver could mean waiting longer for their meal."
What a crock.
I generally hate the idea of tipping before service is provided - it is simply counterintuitive. And DoorDash essentially is institutionalizing its workers ability to disenfranchise customers who have every right to expect reasonably efficient service.
If I were a business working with DoorDash, I'd reconsider the relationship. And if I were a business competing with DoorDash - or working with a business competing with DoorDash-enabled business - I'd use this as a marketing cudgel.
Because it seems like in some cases, DoorDash is best at delivering threats.
MNB reader Stacy McCoy responded:
I might be in the minority here, but when I use the DoorDash app at higher volume hours (i.e. dinner when I’m traveling), I know that I am competing with other DoorDash customers to get my meal picked up and delivered before any of their meals. I am already paying more for the meal as a convenience. I have no problem tipping more than suggested to get priority over other customers that are sending in orders at the same time. I have found that tipping generously in advance works to my advantage; my meals are delivered quickly and correctly.
And if there is an issue, I can always complain to DoorDash and use another meal delivery service, although that has yet to happen.
On the subject of branding, MNB reader Jerome Schindler wrote:
It was cold in central Ohio today - so I put on my heavier waist length jacket. This jacket was my father's and he passed away over 22 years ago. It was his only such jacket and he probably wore it for at least ten years. There is very minimal wear and tear notwithstanding a lot of use. The brand , "Lands End". I will be 81 next month and probably will pass it on to my son. Worth a mention I thought.
The lesson is that it is as important to walk the walk as well as talk the talk.
Regarding Publix's positive financial numbers, one MNB reader wrote:
Pretty sure that Publix shoppers dealing with inflation, stagflation, grocery bills that have soared, etc. will be happy to learn that "Publix sees net earnings soar over 100% in Q3."
Last week, CNBC reported that Walmart "is rewriting job descriptions for potentially hundreds of positions at its headquarters to stress that a college degree is not necessarily a requirement. According to the story, it is "working to identify in-demand corporate jobs where skills can be acquired by other means."
I totally agree with the notion that not every executive job requires a college degree, and that there are a lot of different ways to be educated.
Whether it is degree-focused or not, a continuing education is critical in any career. (Or life, for that matter.) It is in learning new things, in having one's preconceptions challenged, in being prompted to move beyond epistemic closure, that people are able to be more valuable in their careers. (And in their lives, for that matter.)
MNB reader Kendra Enget wrote:
This is such an important shift in mindset! One demographic not mentioned in your editorial or the full CNBC article are veterans. Corporations who are not tapping into this skill-rich demographic are overlooking a gold mine. Here at Wesco – the world’s largest electrical distributor – we are continuously educating our hiring teams about military skills and accomplishments, because they are full of foreign-to-civilians acronyms and awards, and quite simply don’t “look like” corporate accomplishments.
Meanwhile, we have 20-year old servicemen and women who are responsible for hundreds if not thousands of headcount and multi-million dollar budgets, yet because they don’t have a college degree, they are often overlooked. At Wesco, we are looking to bridge that gap through our Skillbridge veteran mentorship program and targeted, meaningful internal education, while actively recruiting veterans to our ranks. There are other great programs out there like Vet Ready that can help corporations utilize this incredible resource. As Veterans Day approaches, let’s be mindful of those who protect our freedoms and give them the opportunities they deserve as they transition back into civilian life. What a great way for us to thank veterans for their service!
And finally, this note from MNB reader Henry Stein:
Thank you, Kevin, for posting the touching speech by John Podhoretz at the celebration of his son Isaac’s Bar Mitzvah. That was emotional to listen to.
This ceremony, so important and relevant in the Jewish religion will survive regardless of being overshadowed by the seemingly endless threats to people, to land and to possessions. Young Isaac Podhoretz deserves it.
My pleasure. For MNB readers who may have missed it, here it is: