7-Eleven: When Convenience Is Not Enough

The Wall Street Journal: “For 7-Eleven, Big Gulps and Slurpees are no longer enough. The convenience-store pioneer is falling behind rivals that are gleaning more sales from healthier snacks and freshly cooked meals … The company’s executives said they are working to come up with better foods to sell in their 9,700 North American stores. ‘Simply being open longer than the competitor … is not enough,’ said Raj Kapoor, referring to the stores’ extended hours. Mr. Kapoor, a 23-year veteran of 7-Eleven, is head of fresh food and proprietary beverages.”

“The effort to freshen up 7-Eleven’s business has run into resistance from the chain’s franchisees. Eight out of 10 7-Eleven stores are owned by franchisees, most of whom own fewer than five stores. Many say it is too expensive to maintain new equipment like ovens, and that 7-Eleven needs to pay to remodel their stores if they want them to sell more fresh and hot food. ‘Our stores don’t look like we are in the food business,’ said Hashim Sayed, who sold his store in Chicago back to 7-Eleven this week after 25 years as a franchisee.”

“7-Eleven says it has been addressing the shift in tastes for several years. But competitors have done more to sell fresh—and more profitable—foods, analysts said. Regional convenience chains Wawa Inc. and Sheetz Inc. make custom salads and hot meals at on-site kitchens. Iowa-based Casey’s General Stores Inc. is now one of the largest sellers of pizza in the U.S. CVS Health Corp. has reorganized its drugstores to display healthy food more prominently.”

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Waiting in Line: There’s No App For That

The Wall Street Journal: “Every day, Mitchell Burton orders and pays for an Italian B.M.T. sandwich on his Subway mobile app, so the sandwich is waiting at the counter. When he arrives, the 32-year-old Baton Rouge, La., parks and recreation worker frequently heads to the back of the line, to avoid seeming rude to less tech-savvy fellow customers. Line skippers sometimes ‘get the stink eye,’ he says, because fellow patrons don’t understand that there’s an app to order ahead.”

“Various ways to skip lines have gained momentum in recent years, as businesses ranging from retailers to movie theaters have come up with ways for customers to avoid a wait, often with mobile apps and ordering kiosks … In theory, order-ahead technology should appeal to everyone.” But: “Some line lovers say technology gets in the way of the personal touch. That’s why Al DiSalvatore sometimes puts his phone down and lines up the old fashioned way at coffee shops in Philadelphia. He likes when the baristas remember his name and order—something that reminds him of his time living in smaller cities.”

“Lining up is part of a gauzy nostalgia for the days before smartphones, which also includes professors banning laptops in class, people stopping at the register to write checks and shoppers skipping shopping online … Erik Fairleigh, 38, who works in communications at Amazon, also has a simple reason for sometimes joining the line. ‘I like to pay in cash,’ he says … Ashleigh Azzaria, a 34-year-old Palo Alto, Calif., event designer, typically chooses to wait in line for coffee at Starbucks, even though she has the mobile app installed and skips the line for bigger orders. ‘It’s my break,’ she says. ‘It’s my time to just kind of decompress, to not be on the phone’.”

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E-urope: Amazon Struggles With Apparel

The Wall Street Journal: “Amazon.com Inc. might look like it’s taking over the world. But it hasn’t conquered Europe. Two decades after the internet behemoth’s first international foray into the region, it’s still working to gain traction selling apparel and footwear. That weakness in a major, growing market illustrates Amazon’s challenge as it expands abroad and tries to replicate its U.S. dominance of e-commerce.”

“To explain Amazon’s struggles in conquering apparel in Europe, retail executives and analysts point to an absence of top fashion brands, a website they say isn’t conducive to browsing for clothes and a fragmented market full of plucky competitors.”

“They say Amazon is like a chaotic, online department store where there is little control over brand presentation. By contrast, Zalando, ASOS and other specialty apparel sites are like an upscale online mall where brands are given more control and presentation is sleek, retail executives say … Amazon’s philosophy is that a large customer base attracts brands, while executives at Zalando and other competitors try to attract brands that will bring customers, said Barbara E. Kahn, professor at the University of Pennsylvania’s Wharton School of Business.”

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Short Staff + Long Lines = Retail Meltdown

The Wall Street Journal: “Over the past 12 months, 86% of U.S. consumers say they have left a store due to long lines, according to a survey conducted by Adyen, a credit-card processor and payment system. That has resulted in $37.7 billion in lost sales for retailers, Adyen estimates.”

“Retailers typically set staffing as a percent of sales, but a growing body of research suggests it should be based on foot traffic. The problem is twofold: Many retailers don’t track traffic and even if they do, they are reluctant to add labor, which is already among their biggest costs.”

“After installing cameras last year, Cycle Gear Inc., a 130-store chain that sells motorcycle apparel and accessories, noticed sales dipped during the afternoon at its Orlando, Fla., store even though it was packed with shoppers. ‘That told us the salespeople were overwhelmed,’ said Rodger O’Keefe, a vice president. ‘We added two more salespeople during those hours, and sales have been up since then’.”

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The Costco Pizza Sauce Robot

Reader’s Digest: “Costco works hard to make sure their pizza is practically perfect every time, and it’s all thanks to a secret pizza robot. This magical machine evenly distributes their sauce on the pizza dough… The gourmet gadget is actually pretty mesmerizing to watch in action.”

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The New ‘Choice’ in Convenience Stores

The Wall Street Journal: “In 2,700 square feet, about the size of a Chipotle, Choice is open 24 hours a day and sells staples like pasta, milk and yogurt, specialty items like quinoa, and an array of fruits and vegetables. You’ll also find beer and kombucha on tap, and snacks that skew toward multigrain chips and seaweed but also include Doritos. The interior sports white subway tile, reclaimed wood and other design codes that telegraph hip sustainability. What is Choice? A restaurant? A grocery store? Neither, said founder Mike Fogarty. It’s a convenience store.”

“Choice Market, Green Zebra Grocery in Portland, Ore., Foxtrot in Chicago, the Goods Mart in Los Angeles and Amazon Go in Seattle are open long hours (if not 24) and use the same small spaces to offer a wider range of options. You could meet a friend for coffee, pick up a few reasonably wholesome items for dinner or even fill up a growler of beer … Traditional players, too, are adding hardwood floors and more attractive lighting. Wawa, the mid-Atlantic chain famous for its hoagies, is rolling out customizable salads across their 790 stores and testing delivery.”

Lisa Sedlar, the founder of Green Zebra Grocery, comments: “People will come in and say this isn’t a convenience store, And I say, ‘Of course it is.’ We are redefining what it means to be a convenience store in America.”

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The Color of Money: Bias & The Brand Experience

Alexandra C. Feldberg and Tami Kim: “Over the past two years, we have investigated discrimination in customer service by conducting large-scale field experiments in the hospitality industry. We have repeatedly found that front-line workers exhibit racial bias in the quality of customer service they provide. In one experiment, we emailed approximately 6,000 hotels across the United States from 12 fictitious email accounts. We varied the names of the senders to signal different attributes, such as race and gender, to the recipients.”

“Overall, hotel employees were significantly more likely to respond to inquiries from people who had typically white names than from those who had typically black and Asian names … Hotel employees provided 20 percent more restaurant recommendations to white than to black or Asian people. Employees’ politeness also varied by race. When responding to white people, employees were more likely to address them by name and to end their emails with a complimentary close (e.g., “Best,” “Sincerely”) than they were when responding to black or Asian people.”

“Instead of relying primarily on trainings to remedy bias, if they truly want to transform the way they serve customers, companies need to make structural changes. For instance, they should standardize scripts and provide employees with specific protocols for managing these situations. Such efforts can institutionalize norms of behavior for employees when they interact with customers … To detect bias in these behaviors requires quantifying different aspects of customer service and comparing treatment quality across a range of customers … It is only after identifying these disparities that companies can develop targeted interventions to combat biases.”

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Micromerch: Statements for Daily Life

The New York Times: Here comes micromerch:”personal merchandise for niche public figures and celebrities (or even not-yet celebrities) made possible by innovations in manufacturing and distribution, and with mechanisms greased by the ease of the internet. Consider it the modern-day equivalent of the private-press LP or the small-batch zine, amplified for social media and very late capitalism … small-batch merch — a couple dozen to a couple thousand items — can be made available for almost anyone, from emergent social media or reality TV demicelebrities to casual dadaists who toy with the dissemination of ideas in the modern marketplace. In an era when personal branding is presumed, no following is too small to monetize.”

“Want to show support for Sean Bryan, a.k.a. the Papal Ninja, an American Ninja Warrior contestant and lay minister? There’s a shirt (and laptop case) for that. Enthralled by the 1980s sunglasses worn by the rubber-legged teen social media star Roy Purdy in his absurdist dance videos? For a while, he sold them, too. Obsessed with Gordie, the French bulldog owned by Alex Tumay, who engineers Young Thug’s records? Buy a shirt.”

“Peloton, the home indoor cycling business, has a stable of a dozen instructors, and sells merch inspired by each. Jill Foley, Peloton’s director of boutique apparel, said the company has sold hundreds of T-shirts and tank tops with instructor catchphrases like ‘It’s Not That Deep’ (Cody Rigsby) and ‘Sweat Sing Repeat’ (Jenn Sherman).” She comments: “We’re getting messages to people in this micro way. We’re in people’s homes in their daily life.”

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Branding The Brandless Brand

Business Insider: Brandless, “which sells food and consumable essentials all for $3 and pitched itself as the “Procter & Gamble for millennials,” first launched in July … The brand is now moving into the physical world with a pop-launching in May, called ‘Popup with a Purpose.’ It will be a ‘three-dimensional experience of the values of what Brandless is really about,’ according to CEO and co-founder Tina Sharkey. The Brandless brand will be on display, but no products will be for sale. Instead, the 3,500 square foot location on Melrose Avenue in Los Angeles will be offering samples, and opportunities to “live, learn, and love with intention,” according to a press release.”

“The pop-up will be interactive and there will be panels, workshops, and talks by experts in the fields associated with the areas of food and wellness that Brandless has staked out. Along with the pop-up, Brandless is also launching a lifestyle blog that will be focused on educating consumers of the claimed benefits of, for example, ‘tree-free toilet paper’.”

“Sharkey sees Brandless as filling gaps where the ease of shipping and low point of entry can allow people to try new things — like gluten-free baking mix — that would otherwise be either too expensive or just hard to find locally in some areas … The B.more membership program, which previously only lowered the free shipping order threshold to $48 dollars, now makes all orders ship free. The company has since started focusing on offering B.more to repeat Brandless customers.”

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Short Edition: The Literary Vending Macine

The New York Times: “Short Edition, a French community publisher of short-form literature, has installed more than 30 story dispensers in the United States in the past year to deliver fiction at the push of a button at restaurants and universities, government offices and transportation hubs. Francis Ford Coppola, the film director and winemaker, liked the idea so much that he invested in the company and placed a dispenser at his Cafe Zoetrope in the North Beach neighborhood of San Francisco. Last month public libraries in four cities — Philadelphia; Akron, Ohio; Wichita, Kan.; and Columbia, S.C. — announced they would be installing them too. There is one on the campus at Penn State. A few can be found in downtown West Palm Beach, Fla. And Short Edition plans to announce more, including at Los Angeles International Airport.”

“Here’s how a dispenser works: It is shaped like a cylinder with three buttons on top indicating a “one minute,” “three minute” or “five minute” story. (That’s how long it takes to read.) When a button is pushed, a short story is printed, unfurled on a long strip of paper. The stories are free. They are retrieved from a computer catalog of more than 100,000 original submissions by writers whose work has been evaluated by Short Edition’s judges, and transmitted over a mobile network. Offerings can be tailored to specific interests: children’s fiction, romance, even holiday-themed tales.”

“Short Edition, which is based in Grenoble and was founded by publishing executives, set up its first kiosk in 2016 and has 150 machines worldwide … The dispensers cost $9,200 plus an additional $190 per month for content and software. The only thing that needs to be replaced is paper. The printed stories have a double life, shared an average of 2.1 times.” Kristan Leroy of Short Edition comments: “The idea is to make people happy. There is too much doom and gloom today.”

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