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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Jig-Sawge: Hacking Saws for Massage

The Wall Street Journal: “The popularity of massage is rising along with the price of electric gadgets for it. So some do-it-yourself-ers are raiding garages and Home Depot and turning power tools into turbocharged robo-masseurs. Bill De Longis, head strength coach at Trinity College in Hartford, Conn., uses a jigsaw—with a lacrosse ball pierced and epoxied to its business end—for limbering the limbs of the school’s varsity athletes. He calls it his ‘jig-sawge.’ He opted to hack the $60 saw after seeing a similar massage tool priced at $600.”

“The coach also has appropriated an orbital sander (with sandpaper removed) and a battery-powered car buffer, which Trinity’s baseball pitchers and women’s lacrosse team use to warm up. Using power tools for massage seems to have originated among weightlifters and other serious athletes. The idea spread on social media, and now power tools can be found everywhere from chiropractors’ offices to tie-dyed campouts.”

“Nova Han, artistic director for the Electric Forest music festival in Rothbury, Mich., equipped a 1940s Quonset hut-style space on the event’s grounds with massage tables. Last summer, staff members dressed like Rosie the Riveter and worked rotating shifts for 12 hours a day, giving short car-buffer massages to concertgoers.” Tim Perra of Stanley Black & Decker comments: “We do not condone, approve or recommend that our tools be used for any application beyond those for which the tool was designed and intended.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Tote Bags Carry The Brand Message

The Wall Street Journal: “Sturdy, canvas, waterproof or made of recycled material, tote bags take up an expanding part of our lives (and car trunks) as cities, counties and states continue to impose fees or bans on plastic bags. Stores either give them away free with purchase or sell them for a couple bucks in the hopes that consumers will like them and carry them—and that others will notice.”

“When totes are durable and reusable they become longer-lived ad campaigns. Swimwear label 6 Shore Road’s founder, Pooja Kharbanda, says that she made 1,000 tote bags to distribute at pop-up stores in Montauk, N.Y., and Newport, R.I., this summer. She estimates the cost is 2.5 times what it would be if she had just chosen paper bags. But she hopes the bags will turn up on the beach, carrying flip flops and towels … Some retailers sell the bags to help cover the cost. H&M ’s tote bags cost $2 to $4 and help spread the word about its garment recycling program. Customers who trade in old clothing or textiles can get 15% off their purchase.”

Marybeth Schmitt of H&M North America comments: “We know that word-of-mouth is the strongest kind of advertising. And, this is like a form of word-of-mouth. They are recommending it by wearing it.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Ikea Frakta Bag: Dark-Horse Design Icon

Fast Company: “Ikea’s bright-blue Frakta bag has become something of a dark-horse design icon. Who would’ve guessed a 99-cent crinkly plastic tote would be as beloved and as indispensable, to some, as an iPhone? … Ikea casts the bag in a democratic light, showing how it’s a does-it-all-design–grocery bag, makeshift umbrella, beach tote–in virtually every scenario: vacation, biking, at home, at work, even when kicking out your ex and all his junk. In Ikea’s eyes, the bag is common ground for everyone.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

$13 Burgers Slows Demand for Fast Food

The Wall Street Journal “As the number of outlets serving ‘better’ burgers—featuring nontraditional toppings and artisan buns—has skyrocketed over the past decade, so has the average burger tab, turning some customers off … Lunch traffic to quick-serve hamburger restaurants fell 5% last year—the biggest year-over-year decline that market-research firm NPD Group Inc. has recorded … The average lunch burger check—including fries and a beverage—has risen 22% since the financial crisis to $5.83, with a 4% increase last year alone, according to NPD.”

“With so much competition and only so many ways to differentiate a burger, upstarts have been coming out with evermore gourmet ingredients, such as Wagyu beef, roasted garlic aioli and truffled arugula, which have raised the bar for burgers overall—and their price tag …they can beef up profits by charging extra for additional toppings … A basic hamburger at (Fatburger) starts at $5.94, but after adding bacon and chili, it is $8.14. With fries and a drink, the combo totals $13.37.”

McDonald’s recently adopted a back-to-basics approach after years of chasing health-minded customers with products such as salads, sandwich wraps and fruit smoothies. It had neglected its burgers and recently found that only one in five millennials had ever tried its signature Big Mac … The burger giant has been trying to improve the quality of its burgers by adjusting temperatures and cook times to deliver hotter, fresher burgers. Next year, it plans to make its Quarter Pounders with fresh, instead of frozen, beef. It is also in the process of rolling out higher-end, customizable burgers from a ‘Signature Crafted’ menu to compete with the ‘better’ burger places, but at a much lower price.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Google Eyes: Watch While You Shop

The Washington Post: “Google executives say they are using complex, patent-pending mathematical formulas to protect the privacy of consumers when they match a Google user with a shopper who makes a purchase in a brick-and-mortar store. The mathematical formulas convert people’s names and other personal information into anonymous strings of numbers.”

“The formulas make it impossible for Google to know the identity of the real-world shoppers, and for the retailers to know the identities of Google’s users, Google executives said. The companies know only that a match has been made. In addition, Google does not get a detailed description of the individual transactions, just the amount spent.”

“Google would not say how merchants had obtained consent from consumers to pass along their credit card information. In the past, both Google and Facebook have obtained purchase data for a more limited set of consumers who participate in loyalty programs. Consumers that participate in loyalty programs are more heavily tracked by retailers, and often give consent to share their data with third parties as a condition of signing up. (Not all consumers may realize they have given such consent, according to the digital privacy advocacy group Electronic Frontier Foundation).”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Michael Ruhlman & The American Grocery

The Wall Street Journal: “Is there any place more American than the supermarket? Forget the airport and the voting booth; for nearly a century, the one-stop shop has remained a temple of consumerism, not to mention our particular form of consumerist anxiety … In Grocery: The Buying and Selling of Food in America” Michael Ruhlman focuses on “his beloved hometown supermarket, Heinen’s Grocery Store, a Cleveland-based chain with 23 locations in Ohio and Illinois. Joe Heinen opened the first one in 1933, three years after Michael Cullen launched ‘the first true supermarket,’ in Mr. Ruhlman’s designation: King Kullen in Queens, N.Y. Heinen, like Cullen, stockpiled meat, seafood, dairy, produce and groceries, often at a discount, under a single roof. (King Kullen’s slogan was ‘Pile it high. Sell it low.’)”

“There are now 38,000 grocery stores in America, some as large as 90,000 square feet. Heinen’s has annual sales of some $600 million—on a margin of only 1.25% to 1.5%, typical of the industry. ‘You do sales of half a billion dollars,’ a Heinen’s executive notes to Mr. Ruhlman, “and you only have profit of $5 million—what kind of a business is that?'”

Now the best grocery stores compete in a crowded marketplace by combining all of the above while becoming obligatory shopping, and even tourist, destinations. Wegmans, an East Coast chain frequently named America’s top grocery, and Central Market, an upscale offshoot of Texas’ H-E-B … have generated the kind of fervent fan bases once limited to sports franchises.” However: “Jeff Heinen fears that the supermarket will eventually go the way of the suburban shopping mall. ‘We’ll be prepared food and specialty products,’ he tells Mr. Ruhlman. Everything else, all those center-aisle products, in his estimation, will be delivered via Amazon.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Intuition, Math & The Supermarket Checkout

The Wall Street Journal: “We are used to the standard system of one line for each cashier. But what if there is just one big lane feeding multiple cashiers? … The single queue often snakes around, as lines do at airport security checkpoints. Mathematical queuing theory says that the serpentine system should be faster than separate lines leading to separate cash registers, but only with a condition called ‘no jockeying’—the assumption that people in multiple lines won’t hop over to a different line that has become free.”

“But that isn’t realistic, as we can all attest. If you allow jockeying in multiple lines, the serpentine system is no faster on average. It might intuitively seem faster because you won’t get stuck behind a single person taking a long time, but that same delay is just portioned out among more people, leaving the average wait time the same … In a curious twist, one recent study showed that cashiers work faster when they are serving a dedicated line. Perhaps it instills a sense of pride or connection with the customers waiting for one hardworking cashier.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Of Puppuccinos & Peanut Butter Bacon Burgers

The Wall Street Journal: “For some restaurant customers, the hottest items to order aren’t on the menu. In recent years, so-called secret menus have cropped up on social media and attracted a cult following. Devotees proudly photograph their McDonald’s Chicken Cordon Bleu McMuffins, Chipotle Quesaritos (a quesadilla-wrapped burrito) and Shake Shack Peanut Butter Bacon Burgers. Fans debate recipes and discuss how to order tricky items without provoking the ire of harried restaurant staff.”

“Some restaurants, like McDonald’s, deny the existence of such menus, although others say their staff will customize orders. Some establishments actually embrace the concept. Many creations are suggested and named by consumers, who detail online what ingredients to request. Sometimes, people put them together on their own.”

“Occasionally, secret menus aren’t limited to restaurants’ human clientele. Last year, Ricky Wolfe and his then-girlfriend, with dog Wally in tow, drove through a Starbucks in College Park, Md. She ordered a coffee and a Puppuccino. The barista, no questions asked, handed over a tiny cup filled with whipped cream. Mr. Wolfe, 28, was incredulous. Wally, a shepherd-hound mix, was apprehensive until her tongue met the whipped cream.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail