Amazongeddon: The New Supermarket Battleground

Quartz: “In southwest Ohio, the prices of staple foods are hitting the floor. A carton of eggs in Cincinnati supermarkets are going for as little as 39 cents. And gallon-sized jugs of milk are selling for less than a dollar. The American grocery store is about to become a battleground—and consumers will love it.”

“Shoppers in the UK certainly did. Established companies such as Tesco forfeited millions in sales to compete on price with German discount grocers Aldi and Lidl, who began opening more and more stores. Now, those discount brands have made it to the US, and have opened hundreds of stores across the country … These telltale signs of a brewing US grocery-store war are happening just as online retailer Amazon has decided it wants to shoehorn itself into the grocery business by acquiring health food grocery chain Whole Foods for $13.7 billion.”

“But disrupting groceries will be a lot different than shaking up publishing, which is how Amazon got its start. Unlike bookstores of the late 1990s, clawing away at market share by driving prices down is a game supermarket companies are already good at playing.”

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Ruimilk: Cotton Candy Soft Serve

The New York Times: Marie Sullivan and Burton Eggertsen were walking off a dim sum lunch when they stopped to study the colorful menu in the window of Ruimilk Soft Icecream — a shop in Flushing, Queens, that combines soft-serve ice cream with cotton candy art … Ms. Sullivan, 32, ordered the Miss Kitty — a cup of soft serve enshrouded in a white cotton candy cloud with edible ears, eyes, whiskers and pink bow.”

“At 136-49 Roosevelt Avenue, sandwiched between a video-game store and a bubble tea counter, Ruimilk appears no more than six feet wide. Most customers linger for only a moment by the three small tables, which serve as set furniture for customers as they photograph their confections. Proud parents photograph their children holding the desserts as if they were trophies or straight-A report cards.”

“The engineer behind Ruimilk is Nian Geng Lin, 27, of Fuzhou, China. Inspired by a South Korean trend he noticed — there, street vendors treat cotton-candy-spinning as an art form — Mr. Lin opened the shop about a year ago. His goal was, and still is, to bring ‘happy smiles’ to customers’ faces … Other cotton-candy-and-soft-serve options include the Baymax, a white creature that resembles the Abominable Snowman, and the Air Balloon, a hot-air balloon fashioned with the help of Pocky biscuit sticks.”

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Quantumobiles: VW Catches D-Wave

The New York Times: “Efforts by Volkswagen, trying to remake itself as a technology leader as it recovers from an emissions scandal, show how far into exotic realms of technology carmakers are willing to go. Volkswagen, a German company, recently joined the handful of large corporations worldwide that are customers of D-Wave Systems, a Canadian maker of computers that apply the mind-bending principles of quantum physics.”

“While some experts question their usefulness, D-Wave computers — housed in tall, matte black cases that recall the obelisks in the science fiction classic 2001: A Space Odyssey — can in theory process massive amounts of information at unheard-of speeds … While classical computers are based on bits with a value of either 1 or 0, the qubits in a quantum computer can exist in multiple states at the same time. That allows them, in theory, to perform calculations that would be beyond the powers of a typical computer.”

“This year Volkswagen used a D-Wave computer to demonstrate how it could steer the movements of 10,000 taxis in Beijing at once, optimizing their routes and thereby reducing congestion … Such claims are met with skepticism by some experts, who say there is no convincing proof that D-Wave computers are faster than a well-programmed conventional supercomputer … Volkswagen executives say they will publish the results of their work with D-Wave computers, allowing outsiders to try to debunk them.”

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Kronkiwongi: How Lego Fans Fandom

Fast Company: “In a presentation at the Cannes Lions Festival of Creativity on Sunday, Lego’s senior global director of social media and video Lars Silberbauer, broke down how the brand built and approaches that strategy … The two pillars of the brand’s social strategy are based on two core human social needs: the need to play and build together, and the pride of creation … By facilitating, supporting, and promoting the efforts of its fans, Lego amplifies their passion to a global audience, further fanning the flames of fandom everywhere it goes.”

“Silberbauer outlined three examples of how they do this. The first is through a competition called First Lego League, a Lego robotics competition that’s not run by the brand at all, in which up to 70,000 kids worldwide against each other in building Lego robots that can solve challenges. Second was the crowdsourcing platform Lego Ideas, where the brand invites people to propose and build new Lego sets. Like a branded version of Kickstarter, aspiring Lego designers have to get 10,000 supporters for their projects in order to be considered.”

“The third example was the Kronkiwongi Project.” Silberbauer explains: “The insight behind it is that 98% of us were creative geniuses at age three, but the challenge is that only 2% of us retain that level of creativity. With this project, we wanted to reveal and celebrate, not that we get less creative, but the amazing openness and creativity that kids have. So we asked kids from all over the world to tell us what a Kronkiwongi is and to build one for us.”

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Game On: The Future of Sports Arenas

The Guardian: “With its own dedicated fromagerie, microbrewery and Michelin-calibre restaurant, it might be easy to forget you have come to watch the football when you are reclining in one of the premium lounges of Tottenham Hotspur’s new £750m stadium. The 61,000-seat behemoth will feature the longest bar in the country, heated seats with built-in USB ports, a glass-walled tunnel so you can see the players before the game and even a ‘sky walk’ allowing fans to clamber over the roof of the arena.”

“Besides the fancy catering, the football pitch itself has to work a lot harder, too. This is the first field of its kind designed to split into three parts and slide seamlessly under the seating stands, revealing an astroturf field beneath for American football, positioned at a lower level to ensure perfect sight lines for both modes of play. Acoustic consultants were brought on board in order to guarantee maximum amplification of crowd noise, ensuring a “wall of sound” will resonate from the 17,000-seat south stand.”

Christopher Lee, an architect, “says the next big frontier is holographic representation, describing a world where players might be beamed on to the field from thousands of miles away.” However, architect Jacques Herzog “says his focus is always on capturing the local specificity of the place, designing a venue that somehow responds to the fan culture of the team in question, whether that’s a glowing lantern for Munich, a sharp white temple for Bordeaux, or an archaic masonry complex of vaults and buttresses for Stamford Bridge.”

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How TJ Maxx Defies Digital Gravity

The Wall Street Journal: “Traditional retailers are in crisis, damaged by rapidly shifting consumer tastes, technological change and cut-throat price competition. And then there’s TJX Co., which is defying gravity with the simple idea that under the right circumstances people still like to shop in stores … Central to TJX’s success are its merchants. The company employs more than 1,000 buyers who buy apparel and other goods from more than 18,000 suppliers around the world. Each buyer controls millions of dollars and has authority to cut deals on the spot, unlike most department stores, which can take weeks to review and approve orders.”

“Stores typically get deliveries several times a week. The schedule ensures a continuous stream of products to lure shoppers. And because TJX doesn’t purchase the full range of colors and styles, stores have one or two items in a particular color or size, giving customers an urgency to buy … Its stores have no walls between departments, so it can quickly reconfigure floor plans. Similar clothes from different labels can be found on the same rack.”

“One area where TJX trails other retailers is on the Internet … Some brands won’t let TJX sell their products online because they don’t want the items to be easily searchable at lower prices. For certain brands that allow online sales, shoppers have to click on items before they can see brand names. The restraints are similar to those in the physical world, where some companies do not allow TJX to advertise their brands. Advertising individual labels is not part of TJX’s marketing strategy.”

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Moby Mart: The Supermarket That Comes To You

Fast Company: Moby Mart “is an autonomous, 24-hour convenience store that drives the streets of a city. Stocked with perishables like milk and impulse buys like new shoes, you can spot the nearest one on your mobile app, then grab whatever you need off its shelves. To pay, you scan your purchase with the mobile app. The project is beta testing in Shanghai now, though it’s missing the most aggressive bits of futurism in the first video–the autonomous driving and a fleet of delivery drones designed to launch from the vehicle’s roof … Indeed, the Moby Mart barely feels like sci-fi in the age of Amazon.”

“The Moby Mart is a bridge between the two extremes: lazy and experiential shopping in one. And it also solves what’s often billed “the last mile problem” of delivery: when a customer orders a $5 jar of macadamia nuts, delivering it to their door in just a few hours requires relatively costly, yet oft exploited labor because the margins stink for everyone.”

“So don’t be surprised when you see something like the Moby Mart on streets some day. And don’t be surprised when you see a big Amazon Prime logo on the side. Or Whole Foods. Or Uber Eats. Or . . . well, you get the idea.”

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Zero-Margins & The Future of Retail

Vox: “Competing with Amazon is terrifying for any incumbent business because the company’s executive team operates on a radical model whereby the company’s overall net income is nearly zero quarter after quarter … That’s an enormous problem for every grocery chain in America, which already operate on razor-thin margins … A Whole Foods under Amazon’s stewardship will almost certainly accept lower profit margins than it does as an independent chain — and that spells trouble for everyone else in the grocery business.”

“Whole Foods could deliver value to Amazon without necessarily delivering profits. The stores would create a useful additional channel for selling Kindles, Echoes, Fire TV boxes and other Amazon hardware. And by linking discounts to Amazon Prime membership, it could drive sales of those. More subtly but perhaps more importantly, encouraging Whole Foods shoppers to in some sense ‘log in’ with their Prime accounts would generate tons of new user data that could feed the larger Amazon beast.”

“The bottom line is there are lots of ways that a cheaper, but fundamentally similar, version of Whole Foods could contribute to the Amazon gestalt even while run as a zero-margin business.”

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Amazon Patents Shopper-Control Technology

The Washington Post: “Amazon was awarded a patent May 30 that could help it choke off a common issue faced by many physical stores: Customers’ use of smartphones to compare prices even as they walk around a shop. The phenomenon, often known as mobile ‘window shopping,’ has contributed to a worrisome decline for traditional retailers.”

“But Amazon now has the technology to prevent that type of behavior when customers enter any of its physical stores and log onto the WiFi networks there. Titled ‘Physical Store Online Shopping Control,’ Amazon’s patent describes a system that can identify a customer’s Internet traffic and sense when the smartphone user is trying to access a competitor’s website.”

“When that happens, Amazon may take one of several actions. It may block access to the competitor’s site, preventing customers from viewing comparable products from rivals. It might redirect the customer to Amazon’s own site or to other, Amazon-approved sites. It might notify an Amazon salesperson to approach the customer. Or it might send the customer’s smartphone a text message, coupon or other information designed to lure the person back into Amazon’s orbit.”

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