Philz Coffee: All You Need Is The Secret Ingredient

Business Insider: San Francisco-base Philz Coffee “has the cash to fuel an expansion and a key ingredient to become the next Blue Bottle: individuality. It looks nothing like a cookie-cutter coffee chain. At Philz, a diverse set of customers sit around mismatched pieces of furniture and drink coffee brewed one cup at time. Employees are encouraged to express their personality through interactions with customers … The venture-backed coffee chain started from humble beginnings. Phil, who was born in Palestine and grew up in the Bay Area, ran a corner bodega in a gritty neighborhood.”

“Today, the original Philz location on 24th Street still looks like someone’s grandma’s house. Couches sink like they’ve been lived in, and floor-to-ceiling murals spark creativity … Unlike coffee chains that offer only light, medium, and dark roasts, Philz boasts more than 20 vibrant blends with names like Canopy of Heaven, Philharmonic, and Sooo Good. You won’t find any lattes or over-the-top blended drinks — like you might find at Starbucks — on the menu. But flavor descriptions like “cardamom, maple, earth” or “toast, berry, vanilla” have customers drooling.”

“Baristas brew one cup at a time using a pour-over method, which allows them to make each drink exactly how the customer likes it … Two to three minutes later, a barista calls the customer by name and invites them to take a sip. Baristas say they’re happy to remake the drink until the guest is 100% satisfied … According to a Philz employee, the secret ingredient in every cup is ‘love’ … The company aims to have more than 50 locations across four major metropolitan markets by early next year. There are shops in Colorado and Boston in the pipeline.”

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KitKat: Just Plain Weird in Japan

Los Angeles Times: “Two years ago, KitKat’s marketing manager in Japan won an internal corporate award. His prize: a golden trophy shaped like one of the iconic chocolate bars. Today, the manager, Ryoji Maki, doesn’t remember why he won the award. But he’s immensely proud of what it inspired. ‘That’s how I came up with creating a gold leaf-covered KitKat,’ he said. Before long, the chocolate wafer bars were on sale in Tokyo for about $18. ‘They were like an edible golden trophy’.”

“Maki’s creation joined a long, and ever growing, list of distinctive, fun or just plain weird KitKats found only in Japan. The country is a KitKat-lover’s paradise, with so many unique varieties — an estimated 300 — that some travelers visit Japan just to try them. Many flavors are alien to the American palate, and they go far beyond Japanese staples — such as sake, wasabi and green tea — and into uncharted territory: ‘French salt,’ ‘college tater’ and ‘Muscat of Alexandria’.”

“The candy with the European pedigree went on to conquer Japan thanks to constant invention — blueberry cheesecake, cherry blossom and melon — and a linguistic coincidence that makes KitKats here a harbinger of good luck … the chocolate bar’s English name is a cognate — it sounds like kitto kattsu, which means ‘you will surely win,’ a sort of good luck blessing. Nestle leveraged the association into huge sales.”

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Some Retailers Try Simplified Pricing

The Wall Street Journal: “Retailers have a gift for discount-obsessed holiday shoppers: simpler pricing … Kohl’s has been testing a ‘Your Price’ feature that shows the final price after all discounts … For example, a Disney Princess Palace, regularly priced at $79.99, was on sale on Kohl’s website earlier this month for $54.99 and eligible for an extra 25% off. The “Your Price” was $41.24.”

“Like Kohl’s, Penney this year started showing online shoppers the sale price net of all discounts on the product page and increasingly has been advertising sales with final dollar amounts, rather than percentage discounts … The retailer also has been posting ‘sale conversion charts,’ intended to help shoppers figure out prices … Christine Dunne, of the Bronx, N.Y., said she noticed the changes at the Penney store near her home.” She comments: “It makes shopping so much easier. In the past, I’d get to the register and realize the price I’d calculated in my head was wrong.”

“Not all retailers have simplified their pricing, and marketing experts say that is by design. ‘Multiple mental deductions based on promotions can result in consumers perceiving that their costs are lower than they actually are, which can increase spending,’ said Cynthia Cryder, an associate professor of marketing at Washington University in St. Louis.”

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Fingerlings: Too Much Monkey Business?

The New York Times: The Fingerling is “a five-inch monkey that grips your finger with its legs and arms, as it babbles, blows kisses and blinks its eyes. Cradle a Fingerling in your hand and it drifts off to sleep. Press the Fingerling’s head and it passes gas. Created by the Canadian company WowWee, the Fingerling has been anointed one of this year’s hot toys for the holidays, a designation that most toymakers only dream of achieving.”

“How the Fingerling reached this tipping point — when suddenly millions of children cannot do without a $15 farting monkey — is the story of a promising idea’s going viral on social media, a large retailer’s savvy pricing strategy and the science of managing scarcity … This past week, Fingerlings were out of stock on Walmart’s website, while parents complained that they had been snookered into buying counterfeits … WowWee says it did not intentionally create the shortage. But whether by design or happenstance, there is no question that scarcity fuels a toy’s mystique.”

“WowWee had originally planned on selling the Fingerling for $20, but the giant retailer was insistent: About $15 was the magic number … When Fingerlings hit stores across the United States in August, Maya Vallee-Wagner, 7, was overcome with emotion … Her father … shot a video of his daughter’s reaction in the toy aisle of a local Target and sent it to WowWee … (which) posted it on the company’s Facebook page, and it went viral … The video was a marketing coup, just as WowWee was launching its social media push — an effort that in many ways resembled the rollout of a Hollywood movie. Gone are the days when a toy company could simply blitz Saturday morning cartoons with ads.”

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Dyson Goes to School on Innovation & Shopping

The Wall Street Journal: “This fall, James Dyson launched the Dyson Institute of Engineering and Technology in Malmesbury, England, where his company is based. Students—there are currently 33, with plans to grow to around 200—are paid to work for the company three days a week. Two days a week they go to classes on Dyson’s corporate campus, in subjects such as electronics and mechanical engineering. (The company covers tuition.) Students work toward a bachelor of engineering degree from the University of Warwick, whose professors teach the classes.”

About innovation, Dyson comments: “You can’t ask your customers to tell you what to do next. They don’t know. That’s our job.”

Dyson also “is opening his company’s first stores in the U.S. One opened Nov. 30 in San Francisco and the second, on Manhattan’s Fifth Avenue, will open Dec. 14 … It’s ‘an odd thing to do when so many people are buying things online,’ Mr. Dyson says. ‘You might say it’s counterculture to go rent a very expensive premises on Fifth Avenue, but we’re doing it almost precisely because of that.’ Mr. Dyson says that he wants to use the space to demonstrate how his products work and to learn how consumers interact with them. ‘It’s very difficult online and certainly in a normal store to explain what we’re doing’.”

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What Does Luxury E-Tail Look Like?

The New York Times: “High-end e-commerce remains a bright spot in the shopping landscape: flooded with more cash than ever before and with bubblelike sky-high valuations to boot. It’s a world dominated by two behemoth competitors … Yoox Net-a-Porter, the largest luxury e-tailer by sales, is one of them. It owns the e-tailers Net-a-Porter, the Outnet, Mr Porter and Yoox; it also operates the e-commerce sites for over 30 luxury brands including Stella McCartney, Dolce & Gabbana and Chloé.”

“Farfetch, the other big name, is an online marketplace for 500 independent luxury boutiques and 200 brands as well as the owner of the bricks-and-mortar store Browns in London … Little wonder that during the past year barely a month went by without Yoox Net-a-Porter or Farfetch unveiling a snazzy new strategy or service in a thinly veiled bid to outmaneuver the other. In April, for example, Yoox Net-a-Porter introduced ‘You Try, We Wait’: a same-day try-on-and-wait premium delivery service with at-home shopping consultations. Six days later, Farfetch started a ‘store-to-door service’ in 90 minutes with Gucci in 10 cities worldwide.”

“Then Farfetch revealed a suite of technologies based on responding to consumers in the ‘Store of the Future.’ Yoox Net-a-Porter promptly responded with ‘Next Era’: a partnership with brands that debuted with Valentino giving customers access to Valentino products wherever they are, and however they want them.”

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Shanghai Surprise: World’s Biggest Starbucks

The Washington Post: Starbucks has “opened its largest store in the world: a nearly 30,000-square-foot compound that does much more than simply serve coffee. The new Starbucks Reserve Roastery … in Shanghai, is the first non-U.S. location of a new series of shops designed to offer a more ‘immersive’ experience for coffee lovers, according to Starbucks.”

“It includes three coffee bars, one of which clocks in at 88 feet long — the chain’s longest to date. The coffee bars will serve brews made from beans grown in China’s Pu’er in Yunnan Province … A two-story, 40-ton copper cask towers over the store, refilling the coffee bars’ various silos … As a nod to the local beverage of choice, it also includes a tea bar made from 3-D printed materials, and an in-house bakery employing more than 30 Chinese bakers and chefs.”

“The experience seems curated to keep people milling about the store. It is the first Starbucks location to integrate augmented reality, which refers to technology that combines real-world surroundings with tech, in this case the customers’ smartphones. They can point their phones at various spots around the cavernous room to learn about the coffee-brewing process … The store’s boasting rights as the world’s largest won’t last long, though. The company plans to open a 43,000-square-foot location on Chicago’s Michigan Avenue in 2019.”

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Toblerone & Trademark Triangulation

The New York Times: “When the makers of the distinctive Swiss confection Toblerone reconfigured their triangular treat last year to slim down its hallmark summits and widen the valleys between them, a potential rival — Britain’s Poundland discount chain — saw a niche in the market … while the classic Toblerone bars had become lighter in weight in the reconfiguring — though their price remained the same — Poundland’s bar would be chunkier and cheaper, at one pound, or about $1.35, each.”

“Not, of course, that this was some crude copycat. If, as some contend, Toblerone was modeled on the soaring pyramid of a mountain — the Matterhorn on the Italian-Swiss border, which is about 14,690 feet high — Poundland’s bar was said to have been inspired by two less vertiginous hills in the English county of Shropshire near the border with Wales — the Ercall, at 460 feet, and the Wrekin, at 1,335 feet. Hence the shape of the Poundland bar, with a double set of summits between each valley. And hence its name: Twin Peaks, with what Poundland called ‘a distinctive British flavor compared to Toblerone’s Swiss chocolate nougat’.”

After some legal wrangling, Poundland “was permitted to begin selling in its nearly 900 stores the 500,000 bars already in production — provided it changed the background color of their wrappers from gold to blue. And the lettering was changed: to gold, from the original red. Once the initial 500,000 bars have been sold, Poundland said in a news release, it will ‘revise the shape’ so that the bar ‘better represents the outline of the Wrekin and Ercall hills’.”

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AC Store: The World’s Priciest Grocery?

Boing-Boing: “Barrow, Alaska (pop. 4,335) sits on the northernmost tip of the state. Because of its remote location, groceries are expensive — really expensive … A bag of Tostitos tortilla chips here are ‘on sale’ for $10.74. A single roll of toilet paper is $2.60. A box of Froot Loops is $9.73 …”

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Dollar General & Rural Retail: Ka-Ching!

The Wall Street Journal: “Dollar General is expanding because rural America is struggling. With its convenient locations for frugal shoppers, it has become one of the most profitable retailers in the U.S. and a lifeline for lower-income customers bypassed by other major chains.Dollar General Corp.’s 14,000 stores yielded more than double the profit of Macy’s Inc. on less revenue during its most recent fiscal year. And its $22 billion market value eclipses the largest U.S. grocery chain, Kroger Co., which has five times the revenue.”

“While many large retailers are closing locations, Dollar General executives said they planned to build thousands more stores, mostly in small communities that have otherwise shown few signs of the U.S. economic recovery … This lower-end market is better protected from Amazon and competitors that target wealthier shoppers.”

“For decades, Dollar General prices have been marked in 5-cent increments, making it easier for shoppers to estimate the total price of their purchases … Many popular brands are packaged in small quantities to keep prices under $10—generally yielding higher profits per item than bulk goods at such warehouse chains as Costco … The founders of Dollar General lived in small-town Kentucky and started the company there in 1955, making the store’s rural locations a natural fit. When Wal-Mart Stores Inc. grew past 3,000 stores in the early 2000s, a strategy surfaced: ‘We went where they ain’t,’ said David Perdue, Dollar General’s chief executive from 2003 to 2007.”

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