Supermarkets: A New Social Network?

The Wall Street Journal: “Supermarkets—those havens of the not-so-scintillating chore of scouring numbered aisles, pushing carts and perusing produce—are finding a new identity as a social hub in communities. Parents now bring their children here to play, retirees gather for Bingo, and singles find romance. Grocery stores are fulfilling the new role as traditional gathering spots, from shopping malls to social clubs like Lions Clubs and Rotary International, continue to shrink from decades-earlier peaks.”

“Market of Choice, an Oregon chain of 11 supermarkets, has reduced space for center-store aisles by 22% in recent years and devoted more room to couches, fireplaces with seating areas and restaurant-like services, says owner Rick Wright. Whole Foods says social space is the first thing to get worked into floor plans … Lowes Foods, a Winston-Salem, N.C.-based supermarket chain, has recently redesigned its stores into an animated ‘village concept’ of shops around the perimeter with giant birthday-candle lights, moving signs and employees who perform a chicken dance … At the heart of each store is a large rectangular communal table that can seat 10 to 15 people.”

“Bo Sharon, owner of Boulder, Colo.-based Lucky’s Markets, says about 25% of his stores are devoted to nonretail space, whether that’s tables in a cafe, performance areas for local musicians, or a designated community room where neighborhood groups meet. Fostering a sense of community, he says, ultimately helps drive traffic.”

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1916: When Department Stores Featured Hospitals

The New York Times: “Lord & Taylor, New York’s oldest luxury department store, founded in 1826, boasted ‘one of the most attractive and completely equipped of the small hospitals in New York City,’ according to an article in The Modern Hospital magazine in 1916. The store operated the hospital when it was located on Broadway and East 20th Street before moving to its new building on Fifth Avenue between 38th and 39th Streets in 1914. On Fifth Avenue, the entire 11th floor was devoted to employee health and welfare, from the hospital to various medical and dental clinics, a roof garden, gymnasium, a schoolroom for boys and girls and an employee restaurant.”

“B. Altman, between Fifth and Madison Avenues and 34th and 35th Streets, operated a 12th-floor emergency hospital that by 1916 was handling as many as 18,000 cases a year, according to Hospital Management magazine. A 1914 brochure celebrating the store’s expansion said, ‘The 12th floor of the new addition has been given over in its entirety to the use of the employees.’ Separate dining rooms served men and women, and a physician and two nurses oversaw a large medical suite and surgery. Also, in a sign of those times, there was a men’s smoking room.”

“Welfare services for department store workers began with John Wanamaker … He wanted to keep his workers healthy and happy, and so in an era of rapacious capitalism, child labor and male privilege he introduced half-day-Saturdays off, medical benefits and a retirement system … His competitors soon followed with medical facilities, employee exercise and lunchrooms, educational training, vacation programs and medical clinics. When Macy’s on West 34th Street expanded in 1924, the new 16th floor included an employee dental clinic with chairs for six dentists.”

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How The Cubs Recruit Free Agents

The Wall Street Journal: “Tyler Chatwood thought he knew what to expect when he met with the Chicago Cubs … He assumed he would hear plenty about the Cubs’ recent on-field success, their plan for him in the starting rotation and, of course, the boatload of money they could offer to lure him. Instead, president of baseball operations Theo Epstein and general manager Jed Hoyer took the conversation in a direction that surprised and disarmed him: They recommended the best physicians and hospitals in the area for his pregnant wife … He signed a three-year, $38 million contract with the Cubs shortly thereafter.”

“Granted, the Cubs routinely have one of the largest payrolls in baseball, giving them an undeniable financial advantage over a large portion of the league. They can simply outbid the competition much of the time … ‘If the Yankees offer $130 [million] and the Red Sox offer $130 and the Cubs offer $125, most guys would pick the Cubs’,” one agent said.

“This is the secret weapon that enables the Cubs to practically hand-select talent: a compelling personal touch that goes beyond players’ value on the field. In many cases, that means appealing to the people most important in their lives—their families … This approach has helped transform the Cubs into the most attractive free-agent destination in the sport, an organization that players in its sights rarely turn down … More often than not, players buy it, rushing to join an organization where they believe they’ll be happy.”

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Alexa Challenges Brand Loyalty

The Wall Street Journal: “For decades, the makers of packaged-food, personal and home-care brands have bought shelf space at retailers like Walmart Inc. and Costco Wholesale Corp. that guarantee them nationwide exposure. They have poured billions into branding to make their products instantly recognizable. Selling on websites offers some of those same advantages: Brands can pay for placement on a webpage and display their packaging and logos. Voice shopping, which currently offers customers just one or two product options, could chip away at that tried-and-tested model.”

“In a test conducted in October, Bain & Co. found that for customers making a first-time purchase without specifying a brand, over half of the time Alexa’s first recommendation was a product from the ‘Amazon’s Choice’ algorithm, which implies a well-rated, well-priced item that ships with Prime. Bain also found that in categories in which Amazon has a private brand, 17% of the time Alexa recommends the private-label product first even though such products make up just 2% of volume sold.”

“For now, brands can’t pay Amazon to offer their products to customers in response to a generic request for a product, like detergent or paper towels …Without that paid-search option, P&G has been tinkering with ways to get noticed by shoppers using voice assistants, such as a Tide-branded Alexa app that doles out advice on how to clean over 200 stains but doesn’t suggest Tide products … Unilever, owner of Hellmann’s mayonnaise and Domestos toilet cleaner, has developed Alexa apps that give free recipes and cleaning tips that may or may not incorporate Unilever brands. Unilever sees the apps as a way to market its products by offering customers useful information when they need it most.”

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Building Belonging: Community & Customers

Fast Company: “The Rapha Cycle Club (RCC), a membership organization grown around Rapha’s cycle apparel business. The RCC has all the hallmarks of traditional community groups: rituals, local organizers, chapters and clubhouses around the world, symbols, shared identity, and social activities. There’s also a code of conduct that creates the conditions for respect and decency between diverse members … This is not the light ‘community’ that brands often speak of when referring to their customers or social media following–this is real, in-person commitment and engagement. And this is not a sideshow to Rapha’s business. It’s core to its business strategy–its spaces are clubhouses not stores, and people are members not customers.”

“Thinking beyond ‘customers,’ ‘fans,’ or ‘followers,’ the next frontier for great brands is stepping into the cultural need and market opportunity for deeper, real-world person-to-person connection … Those companies that help us forge meaningful connections will win deep loyalty. And this needs to go beyond premium brands. If belonging can be built around apparel and technology companies, surely it can also be built around learning, parenthood, food, and health.”

“Although there are some examples of highly engaged communities being developed via technology (e.g., Peloton riders), when it comes to belonging, real connection will most likely come from in-person interaction in real life. But having physical space is not enough: Brands should create spaces, experiences, products, and services that deliberately foster the conditions for diverse people coming together in respectful environments for shared experiences.”

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Purchase Brands vs. Usage Brands

Harvard Business Review: “Where traditional brands focus on positioning their brands in the minds of their customers, digital brands focus on positioning their brands in the lives of their customers. Furthermore, they engage customers more as users than as buyers, shifting their investments from pre-purchase promotion and sales to post-purchase renewal and advocacy.”

“Purchase brands focus on creating demand to buy the product, while usage brands focus on creating demand for the use of the product … Purchase brands emphasize promotion; usage brands emphasize advocacy … Purchase brands worry about what they say to customers; usage brands worry about what customers say to each other … Purchase brands try to shape what people think about the brand along the path to purchase; usage brands influence how people experience the brand at every touchpoint.”

“The simple view would be that traditional brands are purchase brands and digital brands are usage brands. But there are exceptions, including brands like Visa, FedEx, Lego, and Costco, which exhibit many of the characteristics of usage brands … They think of customers less as one-time buyers and more as users or members with an ongoing relationship … Purchase brands focus on the ‘moments of truth’ that happen before the transaction, such as researching, shopping, and buying the product. By contrast, usage brands focus on the moments of truth that happen after the transaction, whether in delivery, service, education, or sharing.”

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Why Do Pizza Chains Attract Republicans?

Morning Consult: “Large pizza chains accounted for 36.5% of sales in states that President Donald Trump won in 2016, compared to 23% of sales in states that voted for Hillary Clinton … Pizza industry experts suggest the popularity of major chains in traditionally conservative states — and to some extent, price and the level of more premium toppings — could be reasons for the political divide.”

A theory: “While pizza was plentiful in Italian immigrants’ urban communities along the East Coast around the turn of the 20th century, it was sparse elsewhere in the United States. It wasn’t until the late 1950s and early 1960s, when companies like Pizza Hut, Domino’s and Little Caesars cropped up in the Midwest, that pizza was brought to the wider American public. During the industry’s early years, when chains were starting, companies focused their marketing on lower-income neighborhoods and presented pizza as an inexpensive dinner option in those Midwestern hubs.”

Carol Helstosky, author of Pizza: A Global History, comments: “If we think about this in culinary terms, the emphasis is on cost, reliability, standardization and efficiency … Food historians might label these culinary values conservative, in the sense that the consumer wants the same product, and qualities like fast delivery matter more than particular ingredients or the overall taste.”

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Should iPhone ‘Addiction’ Be ‘Cured’?

Farhad Manjoo: “Tech ‘addiction’ is a topic of rising national concern. I put the A-word in quotes because the precise pull that our phones exert over us isn’t the same as that of drugs or alcohol. The issue isn’t really new, either; researchers who study how we use digital technology have for years been warning of its potential negative effects on our cognition, psyche and well-being.”

“With a single update to its operating system and its app store, Apple could curb some of the worst excesses in how apps monitor and notify you to keep you hooked (as it has done, for instance, by allowing ad blockers in its mobile devices). And because other smartphone makers tend to copy Apple’s best inventions, whatever it did to curb our dependence on our phones would be widely emulated … For starters, Apple could give people a lot more feedback about how they’re using their devices. Imagine if, once a week, your phone gave you a report on how you spent your time, similar to how your activity tracker tells you how sedentary you were last week.”

“Another idea is to let you impose more fine-grained controls over notifications. Today, when you let an app send you mobile alerts, it’s usually an all-or-nothing proposition — you say yes to letting it buzz you, and suddenly it’s buzzing you all the time … Done right, a full-fledged campaign pushing the benefits of a more deliberative approach to tech wouldn’t come off as self-interest, but in keeping with Apple’s best vision of itself — as a company that looks out for the interests of humanity in an otherwise cold and sometimes inhumane industry.”

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Sam’s Club: Ardent Shoppers Feel Jilted

The New York Times: “Walmart’s quiet shuttering of 63 Sam’s Club stores on Thursday — hours after trumpeting its plans to raise wages — sent shock waves through the ardent customer base of the membership-only chain. Patrons protested with unusual passion not granted to the thousands of closings recently announced by other retailers.”

“On social media, some shoppers reminisced about sharing frozen yogurt with their great-grandmother at the local Sam’s Club, while others fretted about remote areas losing a primary source of supplies or a reliable place to pick up prescriptions.”

Bethany Pope Hopp, a mother of five, comments: “Having a store like Sam’s Club is absolutely a necessity for some of us rural, smaller communities. That and Walmart are all we have — we don’t live in an area where there’s a Costco or a Target on every corner.” Dharmendra Singh, whose Sam’s Club was among those closed, laments: “It’s like a long-term girlfriend leaving you and not even giving you a call.”

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Retailers Miss Mark With ‘Targeted’ Emails

The Wall Street Journal: “Traditional retailers were once pioneers of using data to zero in on what customers want. But as the importance of their catalogs and mailings have been overtaken by email and other online media, they have struggled—sometimes to the frustration of their customers.”

Brendan Witcher of Forrester comments: “Nearly 90% of organizations say they are focused on personalizing customer experiences, yet only 40% of shoppers say that information they get from retailers is relevant to their tastes and interests. The ugly truth is that most retailers haven’t done the (hard) work of understanding how to use the data.”

“At no time is that more evident than during the year-end shopping bonanza, when retailers deluge customers with messages. During last year’s holiday season, retail emails increased 15% compared with the rest of the year, but shoppers opened 15% fewer of them, according to a study of eight billion messages by marketing-services firm Yes Lifecycle Marketing.”

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