Open & Closed: The Key to Apple’s Success

The Wall Street Journal: “There are intriguing parallels with the development of the iPod music player in 2001 and the Macintosh personal computer in the early 1980s. None of Apple’s three signature products (Mac, iPod, iPhone) was exactly original, but each represented a quantum jump over existing products. And each flirted with failure at first, mainly thanks to (Steve) Jobs’s penchant for closed systems.”

“When Jobs introduced the Mac in 1984, it was incompatible with other computers and ran hardly any software; after his dismissal in 1985, Apple veered in the other direction, licensing it to clone-makers in a move that proved disastrous. The iPod struggled for years before Jobs’s executives persuaded him to make it compatible with Windows computers. The iPhone didn’t take off until he finally agreed to open its app store to outside developers—to people like Dong Nguyen, whose Flappy Bird game proved so addictive that he succumbed to guilt pangs and pulled it.”

“Each of Apple’s three inventions became successful only after the company struck a balance between open and closed—between accommodating a wide range of people and keeping them in a carefully controlled environment.”

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Distal or Proximal? How Senses Affect Purchases

Fast Company: A Brigham Young University study “found that ads highlighting more distal sensory experiences like sight and sound lead people to delay purchasing, while those that emphasize more proximal sensory experiences like touch or taste lead to earlier purchases.”

“In one experiment, study subjects read ad copy for a summer festival taking place either this weekend or next year. One version of the ad copy emphasized taste (‘You will taste the amazing flavors . . .’), and another focused on sound (‘You will listen to the amazing sounds . . .’). Those who read the ad copy about taste had a higher interest in attending a festival this weekend, while those who read ads emphasizing sounds were more likely to have interest in attending the festival next year.”

Ryan Elder, lead author of the study, comments: “Vision and sound, which are more distal sensory experiences, will help sell products and experiences far from where the consumer currently is, or purchases made in the future. They also help in advertising products consumers may buy for a more distant other, like a colleague. In contrast, taste and touch, which are more proximal (closer) sensory experiences, will help sell products or experiences physically close to the consumer, or for purchases made right now. In addition, when advertising products consumers may buy for a close friend, touch and taste will help sell the product better.”

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Kyoto Style: A Starbucks Like No Other

Boing Boing: “Unlike the other nearly 24,000 Starbucks cafes in the world, this one requires customers to take off their shoes before entering. It has tatami rooms with low tables and cushions on the floor for seating … most fascinating of all, no lines are allowed. In other words, they will only allow a certain amount of customers in at a time … The house was used until 2005 and previously hosted traditional entertainers such as geisha.”

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CVS vs. Walgreens: Health vs. Choice

The Wall Street Journal: “Meet the new CVS … Three years after eliminating tobacco products from its shelves and adding ‘health’ to its name, the company is taking more steps and moving most junk food away from the storefront, banning sales of low-protection sunscreens and eliminating foods containing artificial trans-fats. The changes are part of CVS’s effort to stand apart from rivals by focusing on health-care goods and services … It puts the company on a different path than its main competitor.”

“Walgreens Boots Alliance Inc. says it isn’t a retailer’s job to keep shoppers from their vices … But like CVS, it is trying to boost sales by appealing to a more health-conscious shopper. Walgreens sells cigarettes but offers smoking-cessation help in the form of specially trained pharmacists and quitting aids. It is keeping candy up front but has added fresh fruit and vegetables in other parts of the store. It also has a loyalty program that rewards shoppers with points for exercise and health monitoring that can be used on purchases.”

“CVS says it thinks consumers largely are seeking healthier options and won’t be deterred by the changes. It is gradually rolling out its new format; just four U.S. stores, including the one in North Arlington, have received the makeover so far. CVS plans to put the new format in several hundred of its 9,700 stores by 2018.”

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Quote of the Day: Kasper Rorsted

“Amazon is the best, without any comparison, transaction platform in the world. It might not be the best brand-building platform in the world, but that’s why we…separate crudely between transaction and brand-building.” – Kasper Rorsted, CEO Adidas, quoted in The Wall Street Journal.

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Amazon Reinvents the Wheel (of Retailing)

Quartz: “The wheel of retailing, first proposed in 1958 by Harvard business professor Malcolm McNair, describes a cycle in which retailers start out by offering low-cost products to attract customers, often through an innovation that allows them to undercut more established competitors. As they grow and attract more customers, these retailers raise prices, allowing them to widen their margins and expand. As they raise prices, they become vulnerable to lower-cost competitors, starting the cycle anew.”

“Thus far, Amazon has avoided getting caught in the wheel by constantly expanding into new sectors. By moving beyond books and into general merchandise, then onto fields as diverse as web services and entertainment, Amazon remains a perennial upstart, never taking on the characteristics of incumbents. The company has also never enjoyed the fat margins described by the wheel, instead sacrificing profit for continual growth.”

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Algorithmania: Nutella Prints 7 Million Unique Labels

Hyperallergic: “Nutella’s manufacturer, Ferrero, recently partnered with advertising agency Ogilvy & Mather Italia to make Nutella even more endearing and its consumption more exciting by presenting Nutella Unica, an algorithm designed to create a series of unique labels for (almost) every Nutella jar in Italy. The algorithm pulls from a database of dozens of patterns and colors to create seven million different versions of the Nutella label — pink and green, striped and polka-dotted, Pop Art-inspired and minimal.”

“Advertising for Nutella Unica compares the individuality of each jar to the people of Italy themselves (there are about 60 million people in Italy, so about 11% of them can get a jar all their own — actually quite a feat). When these exceptionally delicious artworks hit shelves in Italy in February 2017, they sold out in barely a month. Can you imagine the shopping possibilities — buying multiples, or maybe trying to find an attractive pair?”

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Uniform Identity: Airline Apparel & Brand Experience

The New York Times: “Long ago, airline uniforms reflected the glamour of flight. Now, they have to serve more utilitarian needs. Do they reflect the airline’s image? Will they look good on most everyone? And, perhaps most important, are they comfortable? … For American Airlines, which introduced new uniforms in September, the different look was an important step in conveying a unified brand image since its merger with US Airways in 2013.” Brady Barnes of American comments: “There was a visual difference in what people were wearing, and I think, inherently, that kind of creates a barrier.”

“Most of the uniform overhauls include clothes not only for flight attendants and gate agents — ‘above the wing’ jobs — but for the luggage handlers, mechanics and other workers who make up an airline’s ‘below the wing’ work force … Shashank Nigam, chief executive of the consulting firm SimpliFlying, said uniforms were a crucial part of an airline’s brand, especially with the decline in the number of in-person encounters a traveler experiences.” He comments: “Today more than ever, the uniform is the most important symbol of an airline that a passenger interacts with and sees.”

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French Twist: How Yoplait Manufactures Authenticity

The New York Times: “Thick, sour Greek yogurts with names like Chobani, Fage and Oikos were surging in popularity. Sales of runny, sugary Yoplait were oozing off a cliff. So Yoplait executives ran to their test kitchens and developed a Greek yogurt of their own … They called it Yoplait Greek. It tanked almost immediately. And so has almost every other Greek yogurt product that Yoplait has put on shelves.”

“So now, Yoplait is opening a new front in the cultured-milk battles … They’re calling it Oui by Yoplait, in homage to the company’s French roots … if, as you are shopping, you happen to pick up a small glass pot of Oui and are momentarily transported to the French countryside, you’ll know that the company has finally figured out how to look beyond the data and embrace the narrative. Yoplait may have figured out how to fake authenticity as craftily as everyone else.”

“Yoplait began scouring its own history and ultimately found a tale that seemed to resonate: For centuries (or so the story goes), French farmers have made yogurt by putting milk, fruit and cultures into glass jars and then setting them aside. So Yoplait tweaked its recipe and began buying glass jars … It has a creamy texture and sweet flavor. And if this product is a success — if years from now someone tells the heartwarming story of how the Greek hordes were defeated by simple French pots — then we’ll know that Yoplait’s number crunchers finally figured out the formula for authenticity, and have reclaimed their crown.”

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Miller Time: Walmart Bends to Jet’s Culture

The Wall Street Journal: Soon after Wal-Mart Stores Inc. bought Jet.com Inc., employees at the e-commerce startup learned how dry life under the retail behemoth could be. That’s because Wal-Mart took away all the office booze … The startup’s regular Thursday evening happy hour would have to be moved out of the office to the Wicked Wolf Tavern and other local bars. Casual deskside drinking had to go.”

However: “Wal-Mart reversed course. In recent weeks Jet brought back Thursday night happy hour in the office—generally beer, wine and food … The change is permeating the empire. Wal-Mart had wine and beer at a tailgate for its e-commerce team in San Bruno, Calif., when it hosted its annual day at a San Francisco Giants game in May. It is ​also​ allowing other startups it has acquired to host a weekly office happy hour—pending approval from a Wal-Mart executive vice president.”

“There are other aspects of Wal-Mart’s traditional habits that still raise eyebrows among Jet staffers. For example, Wal-Mart asked Jet employees to be mindful of swearing in the office.” Jeannie Slivensky, a marketing manager at Jet, comments: “That did not last. This is New York.”

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