How Big is the ‘Store Brand’ Threat?

The Wall Street Journal: “Supermarkets’ ‘private label’ goods have historically been less important in the U.S. than in other mature markets … But now the big European discounters are expanding in the U.S.Lidl launched on June 15 with six stores in North Carolina, just a few days after its key rival, Aldi, unveiled a five-year, $5 billion U.S. expansion plan. These expansion efforts themselves don’t need to succeed. The threat alone will hasten the shift of U.S. grocery toward private label.”

“The more upscale team of Amazon and Whole Foods will speed the push into private label. The tech giant has been plowing resources into its AmazonBasics range; the Whole Foods equivalent, 365 Everyday Value, anchors the grocer’s new, compact store format, 365. Ever attuned to millennial trends, Silicon Valley has even thrown up an online retailer called Brandless that sells $3 health-conscious, private-label goods.”

“Some companies look less exposed than others. Those with big overseas operations, such as Nestlé, Unilever UL or Mondelez, or must-have brands, like Kraft Heinz, stand a better chance of seeing off the new competition than those with U.S.-centric portfolios or lots of third or fourth-placed brands. Bernstein thinks Campbell’s, Conagra, General Mills, Kellogg and Smucker’s are all at risk.”

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The Four Faces of Facebook

Quartz: “Anyone who uses Facebook can safely assume that to the company we are all one type of one thing: bundles of sellable data … Now a new study, published in the International Journal of Virtual Communities and Social Networking, confirms that Facebook has a Rashomon effect: various user groups interpret the experience of using it very differently. Surprisingly, however, the researchers also found they could easily categorize users into four broad types: ‘relationship builders,’ ‘window shoppers,’ ‘town criers,’ and ‘selfies’.”

Relationship builders: “A sample statement that relationship builders identified with was ‘Facebook helps me to express love to my family and lets my family express love to me.’ As the researchers explain in the study, this gang does not consider Facebook an ‘open virtual social society but rather a mini-hub site for personal storytelling, where information freely flows between friends and family’.” Window Shoppers: “Driven by ‘a sense of social obligation’ to be on Facebook, window shoppers see Facebook as an inescapable part of modern life, but they very rarely divulge personal information, share photos, or write updates. Nor do they do much liking or commenting.”

Town Criers: “Unlike relationship builders, their virtual world does not resemble their real life. They might broadcast information they feel compelled to share to a wide range of close and distant connections, but they’re not looking for a follow-up—or not online anyway … Most town criers would rather pick up the phone, text, or direct message someone for an actual conversation.” Selfies: “Selfies routinely use the same Facebook features as relationship builders … but they do it primarily to call attention to themselves, say the researchers behind this study … One seductive quality of online interaction generally, Boyle notes, is that people are able to create a better—or different—versions of themselves.”

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‘Experiences’ May Not Buy ‘Happiness’

Slate: “There’s a whole slew of social science research that suggests that to maximize happiness, it’s best to spend your money on activities, not material goods … But new research from the Hungarian Academy of Sciences, or HAS, adds a wrinkle to the discussion—its new paper suggests that perhaps in embracing this idea, we have been slightly unfair to our stuff.”

“The research, published by Tamás Hajdu of the Institute of Economics at HAS and Gabor Hajdu of the Institute of Sociology at HAS … found that the difference in satisfaction conferred between the different purchase types was both incredibly small and not statistically significant.” They report: “Although both experiential and material expenditures were positively associated with life satisfaction, we found no significant evidence supporting the greater return from experiential purchases.”

“Most research still suggests that money makes people happier when it’s spent on activities. In fact, even this research found that to maximize happiness, you should spend a little more on experiences—it just also found that this “gain” in happiness was incredibly, perhaps unnoticeably, small.”

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Patel Brothers & The Soul of a Supermarket

Quartz: “Patel Brothers is a store that exists at the juncture of pragmatism and fantasy; the store has realized a possibility for pluralist cultural exchange without sacrificing its Indian DNA. Patel Brothers has spawned a subgenre of Indian grocery stores … yet it towers over this ecosystem like a citadel of the Indian-American grocery chain … A visit to Patel Brothers can feel like emerging from a plane: Your sense of the world becomes radically slower, the activity of grocery shopping gaining a more leisurely glean than the frantic stress that can ordinarily accompany a trip to the supermarket.”

“We go to the supermarket to get what we need. But our needs are determined by who we are and how we feed our obsessions. At the grocery store, everything we’d ever want is presented to us matter-of-factly, and we are forced to confront the extent of our desires. Our needs are not simply material. These are selfish, soulful wants, and they come from pits deeper than our stomachs.”

“It’s terrifying to imagine a world where this store does not exist. Here is a business venture born out of one man’s hankering for home and his family’s willingness to ease it. How comforting that they were brave enough to wield these desires openly, so that the rest of us could satisfy the hungers we don’t always realize we have.”

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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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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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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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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.”

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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.”

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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.”

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