Slow Dollars: Key to Local Grocery Success

Anne Kadet: “It’s a mystery. Local markets clearly are losing business to national outfits such as Whole Foods Market , Trader Joe’s and Target. So why don’t they up their game? To my surprise, Enrico Palazio, who co-owns the Montague Street Key Food with his uncle, says he doesn’t view Trader Joe’s as competition. It doesn’t have a deli, butcher or even a respectable detergent section. ‘This is one-stop shopping,’ he says of his store. The real competition, he notes, is FreshDirect.”

“Mr. Palazio “spent a lot of money on last year’s renovation, aiming to outdo FreshDirect by making his store a pleasant place to shop. His markups reflect that investment, he says, but his prices are still lower than FreshDirect. Because his 10,000 square-foot Key Food is too small to carry products at every price point, Mr. Palazio caters to neighborhood preferences. He doesn’t sell the cheapest ice cream brand, for example, but he does stock McConnell’s Fine Ice Cream.”

“To handle more customers, Mr. Palazio says, he’d have to cram the store with more cashiers, baggers and stock clerks. The busy, hectic atmosphere wouldn’t appeal to his clientele, he believes. Burt Flickinger, managing director of retail consultancy Strategic Resource Group, says this strategy is typical of many local supermarkets. ‘It’s the slow dollar versus the fast nickel,’ he says.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Technology Cannot Hug a Customer

The New York Times: “Technology, some hotels are finding, has its limits. ‘Technology cannot hug a repeat guest,’ said George Aquino, the vice president and managing director of AHC+Hospitality … That is the reason his company, which manages several hotels, has been running a training program for some of its managers and other staff members to improve their hospitality skills, connect with local business leaders and learn more about local tourist offerings.”

“Similar programs are sprouting in other cities, involving not just hotels but also restaurants and even cities themselves, which see the personal touch as giving them a competitive edge. For business travelers, in particular, talking to someone knowledgeable about a city can lead to a good restaurant. And it can also help expand business leads.”

“A consulting program based in Tucson, Certified Tourism Ambassadors, trains hospitality workers. Mickey Schaefer, the chief executive and founder, said she had developed the idea in 2006 while working for the American Academy of Family Physicians to plan its conventions. Hospitality workers sometimes did not know their own cities, leading to bad experiences, she said … The program, she said, ‘is more than just helping the customer. It is helping them find the richness of whatever they are interested in.’ She added that the program also instills civic pride.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Blind-Date Books: Novel Mysteries

The Wall Street Journal: “Booksellers across the country are enticing readers to take a chance on a surprise selected by store staff. To set up these ‘blind dates,’ the stores wrap the book to hide the cover and offer a few clues to give a sense of the hidden work’s genre and tone. ‘It’s been the most successful table we’ve ever put together,’ says Cari Quartuccio of the blind-date offerings at a location of Book Culture, where she is the store manager.”

“For customers, trusting the staff at their local store is part of the fun. The clues allow readers to select a gift for themselves. (And then, of course, immortalize unwrapping the mystery volume on Instagram.) At Book Culture, blind-date offerings are wrapped in brown paper and bear a note advising ‘Read me if you liked’ and a list of three books staff members think customers are likely to have read.”

“Book Culture’s Ms. Quartuccio says customers seldom are lukewarm about the notion of blind-date books. Fans often make repeat purchases, with some even buying stacks as gifts. Other customers are perplexed by the idea. Finally, she says, there are those ‘who get really upset when we won’t tell them the title of the book. Mystery isn’t for them, but they still want to take part in it’.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Nike Hears Adidas’ Footsteps

The Wall Street Journal: “With the retail sector in flux, Nike Inc. is looking for new ways to sell sneakers and shirts, but some industry watchers worry that the company’s efforts to broaden its reach could damage its cultural cachet … Frequent online releases of coveted Jordan shoes could make them less rare and not as much in demand anymore, some industry watchers say. By making certain shoes available only through Nike channels or big chains such as Foot Locker, the company is diminishing the mom-and-pop shops that have served as community stewards of cool.”

“Matt Halfhill, founder of sneaker-news site Nice Kicks, which chronicles new releases across major shoe brands … said he has been involved in sneaker culture since the 1990s, believes the push toward direct sales actually hurts Nike’s connection with consumers.” He comments: “It’s a great way to sell commoditized shoes, but most boutiques even discourage you from buying on the phone. They only sell shoes in stores to customers, where you see everyone in line waiting for shoes talking to each other,” he said.”

Meanwhile: “Adidas’s resurgence includes new ‘franchises’—such as the NMD and Kanye West’s Yeezy line—that have gained a youthful following and made inroads on Nike’s cultural dominance. Nick Santora, a former sneaker-store owner and editor of online sneaker magazine Classic Kicks, said Adidas is more on point with youth culture of late.” He comments: “Kanye, for some people, for certain kids, that brand is now acceptable. Nike was always ‘sports, sports, sports,’ but if you’re over 11 years old right now, musicians are where it’s at.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Hamburger Helpless: Packaged Goods Plight

The Wall Street Journal: “The plight of the packaged-goods companies is a classic business tale. An industry creates winning products, carves out strong market positions and enjoys reliable, sustained revenue—only to be too slow to adapt to changes that threaten those cash cows … Many big brands didn’t move fast enough to remove artificial ingredients and haven’t been able to shed the negative perception of processed food, said several food executives and others close to the industry.”

Meanwhile: “The web and social media gave smaller food companies a direct path to consumers’ hearts, minds and stomachs. They gained traction through blogs and Facebook with little marketing spending, selling food online via Amazon.com Inc. or their own websites long before they would have been able to get it in stores … Big brands can no longer control perceptions about food with television advertisements and shelf placement.”

“Kellogg Co., General Mills and others have directly invested in food startups through venture-capital funds that they say will give them insight as to how to respond better to evolving trends.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Instagram Oreos: The New Flavorites

The New York Times: “Oreo makes a lot of cookies — 40 billion of them in 18 countries each year — enough to make it the world’s best-selling cookie. Most of them are the familiar sandwich that’s over 100 years old: white cream nestled between two chocolate wafers. But the company has increasingly been experimenting with limited-edition flavors that seemed designed as much for an Instagram feed as they are to be eaten.”

“This year, the company released limited-edition flavors like Jelly Donut, Mississippi Mud Pie and Firework. They joined a packed shelf that has recently included flavors like Cookie Dough, Birthday Cake, Mint, S’Mores and Red Velvet, which proved so popular as a limited edition that the company upgraded it to everyday flavor status.”

“The company is using the hashtag #MyOreoCreation to collect suggested flavors. The top flavors, as determined by Oreo, will be produced and available nationwide next year for the public to vote on. And here’s where things get, comparatively, weird. Some contenders so far have included English Breakfast Tea (it tastes like tea), Peach Melba (has the flavor of a gummi peach), Mermaid (a sort of lime cream), and at least three doughnut-adjacent flavors to complement the Jelly Donut already in mass production … (The winning flavor may return for a limited-edition run or even as a permanent flavor, but that will be up to Oreo to decide.)”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

‘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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail