Airport Malls: The Call of Duty-Free

The Wall Street Journal: “In the age of online shopping, retailers are finding that airports can take some of the sting out of declining mall traffic. Travelers have time to kill and money to spend when they’re captive inside airport security. Major airports around the world, from Singapore to Dubai, London to Beijing, have essentially become shopping malls with gates.”

“And the U.S. is finally starting to catch up. Just as they have upgraded restaurants and basic amenities like power outlets, U.S. airports are finding they need to improve duty-free stores, which have become a necessity for many world travelers who routinely stock up on perfume, cosmetics, alcohol and chocolate coming home from trips … Airports like duty-free shops because they get a cut of the revenue; luxury-goods makers like the chance to interact in person with shoppers; and customers like the convenience, savings and opportunity for capricious purchases.”

“Moët Hennessy, the Paris-based maker of Champagne and cognac, has a boutique in the Dallas duty-free store where it does tastings of rare editions—a spot of cognac before boarding. The unit of luxury-goods conglomerate LVMH sees airport retail as a chance to educate consumers about its brand … The store has no doors; travelers just wander through. Brands have their own areas, creating a boutique feel. There is some seating upstairs on an open, second level designed for events such as tastings, entertainment and parties that will lure curious passengers.”


Kochhaus: Grocery Store as Cookbook

Kochhaus: “Kochhaus is the first grocery store that is not sorted by product groups, but by creative recipes … As a walk-in recipe book, the Kochhaus offers a constantly changing range of 18 different recipes worldwide. At free-standing tables full of fresh ingredients you will find everything you need for a particular dish – for two, four or more people. At any time there is a selection of appetizers, salads and soups. With creative pasta, fish and meat dishes. And of course some tempting desserts.”

“The recipe tables with large colored plates show at a glance which ingredients are needed for a dish. With the step-by-step cooking instructions in pictures, the perfect dinner is guaranteed to succeed. Delicious delicacies and clever kitchen helpers complete the concept.”


Apple Stores: The DMV of Retail?

Business Insider: “Apple Stores have become an almost mythical part of the tech giant’s brand. Now, they could be killing it … if you’ve visited an Apple Store recently, you may have found that you weren’t visiting a magical tech utopia after all. Many customers are now comparing their Apple Store experiences to those they’ve had at a different place: the dreaded DMV.”

“Customers’ top complaints are focused on crowds and wait times, which can last for hours. Simply put, too many people need assistance at Apple Stores — and employees don’t have the time to help everyone immediately … Irritated customers tired of waiting for simple assistance tend to be less than impressed by Apple Stores’ unique design. Some say they feel Apple has prioritized artistry over customers’ needs.”

“In 2016, Apple retail boss Angela Ahrendts told Business Insider that the company needed ‘to open incredible places that almost behave like a town square, like a gathering place’ … For some, Apple Stores have become a site of frustration, not community mingling. However, the company is renovating dozens of stores across the US in an effort to better achieve its ‘town square’ goals. These revamped stores are larger, which could help with concerns of overcrowding. They also feature a new approach to the Genius Bar with the ‘Genius Grove,’ which allows a section of the store to be focused on repairs and assistance without involving lines.”


Fake Discounts: The Price You Pay

The Washington Post: “Washington Consumers’ Checkbook’s researchers tracked prices of big-ticket items sold at major retailers for 10 months and found disturbing pricing practices at 17 of the 19 studied. At these stores, many sale prices — even those that advertise big savings — are in place more than half the time. And at some stores, the ‘sales’ never end: For several chains, Checkbook found that most items it tracked were offered at a discount every week or almost every week.”

“Although Checkbook found that almost all the stores it checked often advertise misleading sales, some have more egregious pricing practices than others. For J.C. Penney, Kmart, Kohl’s, Macy’s and Sears, the items tracked were offered at sale prices more than 75 percent of the time. For example, at Neiman Marcus and Sears, 10 of the items tracked at both retailers were on sale every week for 10 months.”

“But nearly all the stores at which Checkbook shopped are guilty of some sales-price chicanery — among them, only Costco and Bed Bath & Beyond consistently conducted legitimate sales, meaning any discounts were in place less than half the time. The other 17 retailers as a group marked their items ‘on sale’ 57 percent of the time.”


Retail Equation: Returns from Hell

The Wall Street Journal: “Every time shoppers return purchases to Best Buy Co. they are tracked by a company that has the power to override the store’s touted policy and refuse to refund their money. That is because the electronics giant is one of several chains that have hired a service called Retail Equation to score customers’ shopping behavior and impose limits on the amount of merchandise they can return.”

“When a consumer makes a return, details about his or her identity and shopping visit are transmitted to Retail Equation, which then generates a ‘risk score.’ If the score exceeds the threshold specific to the retailer, a salesperson informs the consumer that future returns will be denied and then directs them to Retail Equation to request a return activity report or file a dispute.”

“It isn’t easy for shoppers to learn their standing before receiving a warning. Retailers typically don’t publicize their relationship with Retail Equation. And even if a customer tracks down his or her return report, it doesn’t include purchase history or other information used to generate a score. The report also doesn’t disclose the actual score or the thresholds for getting barred.”


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.”


Late & Great: Russ Solomon

The New York Times: “Russ Solomon, who died on Sunday at 92, created what for many music fans was the ultimate music emporium: Tower Records, whose yellow-and-red color scheme, ‘No Music, No Life’ slogan, and wide aisles stocked with LPs and CDs defined the retail music business in the pre-digital era. At its peak, the chain had nearly 200 stores in 15 countries and more than $1 billion in annual sales, before debt and shifting consumer habits forced it to close in 2006.”

“Starting at his father’s drugstore in Sacramento, where he sold used jukebox records as a teenager, Mr. Solomon built a retail empire that became known as much for its selection — vast by brick-and-mortar standards — as for the culture that surrounded it. Employees were opinionated aficionados, and Tower stores, open till midnight, were gathering places for fans. The locations on Sunset Boulevard in Hollywood and on Broadway in Greenwich Village became tourist meccas.”

“The shops even made devotees of the stars. Bruce Springsteen and Bette Midler were regular visitors, but Tower’s most famous patron was Elton John, for whom the Hollywood store would open early … Despite Tower’s disappearance from most of the world, it still has a major presence in Japan; the company sold its Japanese locations in 1999 to raise cash. The flagship store in central Tokyo is like a time warp for travelers, with nine floors of music, in-store performances and, out front, a comforting sign in yellow and red with a familiar message: No music, no life.”


Supermarket Future? Not Plastics!

The New York Times: “A supermarket in the Netherlands wants to make it easier on the planet and easier for its customers to avoid adding to the mountains of plastic waste generated every day … the supermarket, Ekoplaza, an upmarket chain, introduced what it billed as the world’s first plastic-free aisle in a store in Amsterdam. There, shoppers found groceries, snacks and other sundries — but not an ounce of plastic. The items are packaged in compostable materials or in glass, metal or cardboard.”

“Sian Sutherland, co-founder of A Plastic Planet, an advocacy group that has pushed the concept, said the initiative was ‘a landmark moment for the global fight against plastic pollution.’ The plastic-free aisle contains about 700 items, including meats, sauces, cereals, yogurt and chocolate. The opening of the supermarket aisle comes as the idea of banning plastic, or at least making more of it recyclable, gains supporters around the world.”

“In the Netherlands, free plastic bags were banned two years ago, after a European Union directive was passed in 2015 to phase them out. At the time, the country of about 17 million used around three billion bags each year, most of which ended up in the trash. Ekoplaza has promised to expand the plastic-free idea to all of its 74 stores by the end of the year.” Ms. Sutherland comments: “There is absolutely no logic in wrapping something as fleeting as food in something as indestructible as plastic.”


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.”